Document:

EXHIBIT
10.64

 

THIRD
AMENDMENT TO CREDIT AGREEMENT

 

This THIRD AMENDMENT TO
CREDIT AGREEMENT (this “Third Amendment”), dated as of July 12, 2004, is
by and among Spherion Corporation, as borrower (the “Borrower”), each
subsidiary of the Borrower party to the Guaranty Agreement (as defined below),
each of the Lenders (as defined below) signatory hereto and Bank of America,
N.A., as agent for the Lenders (in such capacity, the “Agent”).  Capitalized terms used herein and not
otherwise defined shall have the meaning assigned such term in the Credit
Agreement (as defined below).

RECITALS:

 

A.            The Borrower, the lenders from time to time
party thereto (the “Lenders”) and the Agent are parties to that certain Credit
Agreement, dated as of July 24, 2003, as amended pursuant to that certain First
Amendment to Credit Agreement, Security Agreement, Pledge Agreement and
Guaranty Agreement dated August 27, 2003 and that certain Second Amendment to
Credit Agreement dated March 30, 2004, as further amended by and together with
this Third Amendment and as hereinafter amended, modified, supplemented,
extended or restated from time to time (the “Credit Agreement”).

 

B.            The Guarantors and the Agent are parties to
that certain Guaranty Agreement, dated as of July 24, 2003 (as amended to the
date hereof, the “Guaranty Agreement”).

 

C.            The parties hereto have agreed to amend the
Credit Agreement as set forth below.

 

NOW, THEREFORE, in consideration of the premises and the
mutual covenants hereinafter contained, the parties hereto agree as follows:

 

SECTION 1.01     Amendments
to Credit Agreement.  

 

(a)           Amendment
to Cover Page.  The cover page of the
Credit Agreement is hereby amended by inserting the words “and as Co-Arranger”
after the words “JPMORGAN CHASE BANK, as Syndication Agent”.

 

(b)           Amendment
to First Recital.  The first recital
in the premises of the Credit Agreement is hereby amended by deleting the
amount “$200,000,000” in the second line thereof and inserting the amount “$250,000,000”
in replacement thereof.

 

(c)           Amendment
to Section 1.1.  Section 1.1 of the
Credit Agreement is hereby amended by deleting the words “$200,000,000, or such
greater amount as may be established pursuant to Section 1.6” in the
second line thereof and inserting the amount “$250,000,000” in replacement
thereof.

 

(d)           Amendments
to Section 1.6.  Section 1.6 of the
Credit Agreement is hereby deleted in its entirety.

 

(e)           Amendment
to Section 7.23.  Section 7.23 of the
Credit Agreement is hereby deleted in its entirety and the following new
Section 7.23 is inserted in replacement thereof:

 

 

7.23         Minimum
Availability.  The Borrower will at all times maintain
Availability in an amount that equals or exceeds Current Weekly Payroll;
provided, however, if as of the last day of any fiscal month (each a “Calculation
Month”) the Borrower shall not have a Fixed Charge Coverage Ratio for the
Twelve Month Period then ended of at least 1.25 to 1.00 (the “Fixed Charge
Threshold”), the Borrower will maintain Availability in an amount that equals
or exceeds two times Current Weekly Payroll until the end of a Calculation
Month for which the Fixed Charge Threshold for the Twelve Month Period then
ended is met.  In addition, upon delivery
of the annual financial statements required under Section 5.2(a) and the
quarterly financial statements required under 5.2 (b), the Borrower
shall recalculate the Fixed Charge Coverage Ratio for the Twelve Month Period
most recently ended incorporating any adjustments applicable for the Fiscal
Year or fiscal quarter then ended and the Availability requirements set forth
in the immediately preceding sentence shall apply; provided, however,
if the Borrower fails to deliver such financial statements on the date due
(without giving effect to any cure periods set forth in Section 9.1(c)),
the Borrower shall be deemed not to have met the Fixed Charge Threshold until
such time as such financial statements are delivered.

 

(f)            Amendment
to Section 7.25.  Section 7.25 of the
Credit Agreement is hereby deleted in its entirety and the words “[Intentionally
omitted.]” are hereby inserted in replacement thereof.

 

(g)           Amendment
to Section 8.2.  Section 8.2(a)(iv) of the Credit Agreement is hereby amended by deleting
the words “two (2) weeks payroll expense and payroll taxes” in the second line
thereof and inserting the words “Current Weekly Payroll” in replacement
thereof.

 

(h)           Amendments
to Annex A to the Credit Agreement.

 

(i)          The
definition of “EBITDA” is hereby amended by inserting at the end thereof the
words “, plus one-time cash restructuring charges in an aggregate amount
of up to $9,000,000 incurred during March 2004, to the extent applicable to
such fiscal period”.

 

(ii)         The
definition of “Fixed Charges” set forth in Annex A to the Credit Agreement is
hereby deleted and the following new definition of “Fixed Charges” is inserted
in replacement thereof:

 

“Fixed Charges”
means, with respect to any fiscal period of the Borrower and its Subsidiaries
on a consolidated basis, without duplication, Interest Expense, all scheduled
principal payments and all prepayments (whether optional, by acceleration or
otherwise) of Debt (other than any prepayments of the Obligations or the
Subordinated Notes), all Distributions, Excess Pension Contributions during
such period, and Federal, state, local and foreign income taxes, excluding
deferred taxes.

 

2

 

(iii)        The
definition of “Maximum Revolver Amount” set forth in Annex A to the Credit
Agreement is hereby amended by deleting the dollar amount “$200,000,000”
therein and inserting in replacement thereof the dollar amount “$250,000,000.”

 

(iv)        The
definition of “Stated Termination Date” set forth in Annex A to the Credit
Agreement is hereby amended by deleting the date “July 23, 2007” and inserting
in replacement thereof the date “July 24, 2009.”

 

(v)         The
new defined term “Current Weekly Payroll” set forth below is hereby added to Annex A in alphabetical position:

 

“Current Weekly
Payroll” means the weekly amount of payroll expenses (including salary,
hourly wages, payroll taxes, bonuses and commissions) of the Borrower and its
Subsidiaries other than Foreign Subsidiaries payable during the payroll week
most recently ended prior to the date of determination thereof; provided,
however, that with respect to any such payroll expenses that are paid on a
two-week cycle there shall be included one-half of those payroll expenses for
the two-week cycle most recently ended prior to such date of determination.

 

(i)            Amendment
to Schedule 1.1.  Schedule 1.1 to the
Credit Agreement is hereby deleted in its entirety and replaced with Schedule
1.1 attached hereto as Exhibit A.

 

SECTION 1.02     Representations
and Warranties.  The Borrower hereby
represents and warrants to each Lender and the Agent, on the Third Amendment
Effective Date (as hereinafter defined), as follows:

 

(a)           After giving effect to
this Third Amendment, the representations and warranties set forth in Article 6
of the Credit Agreement, in each other Loan Document and in the Canadian
Facility Guaranty, are true and correct in all material respects on and as of
the date hereof and on and as of the Third Amendment Effective Date with the
same effect as if made on and as of the date hereof or the Third Amendment
Effective Date, as the case may be, except to the extent such representations
and warranties expressly relate solely to an early date.

 

(b)           Each of the Borrower
and the other Credit Parties is in compliance with all terms and conditions of
the Credit Agreement the other Loan Documents and the Canadian Facility
Guaranty on its part to be observed and performed and no Default or Event of
Default has occurred and is continuing.

 

(c)           The execution, delivery
and performance by the Borrower and each other Credit Party of this Third
Amendment has been duly authorized by the Borrower and each other Credit Party,
as applicable and there is no action pending or any judgment, order or decree
in effect which is likely to restrain, prevent or impose materially adverse
conditions upon the performance by the Borrower or any other Credit Party of
its obligations under the Credit Agreement, the other Loan Documents or the
Canadian Facility Guaranty.

 

3

 

(d)           This Third Amendment
constitutes the legal, valid and binding obligation of each Credit Party,
enforceable against each such Credit Party in accordance with its terms, except
to the extent that enforceability may be limited by applicable bankruptcy,
insolvency, moratorium, reorganization or other similar laws affecting the
enforcement of creditors’ rights or by the effect of general equitable
principles.

 

(e)           The execution, delivery
and performance by the Borrower and each other Credit Party of this Third
Amendment do not and will not conflict with, or constitute a violation or
breach of, or result in the imposition of any Lien upon the property of each
Credit Party or any of its Subsidiaries, by reason of the terms of (i) any
contract, mortgage, lease, agreement, indenture, or instrument to which the
Borrower is a party or which is binding upon it, (ii) any Requirement of Law
applicable to any Credit Party or any of its Subsidiaries, or (iii) the
certificate or articles of incorporation or by-laws or the limited liability
company or limited partnership agreement of any Credit Party or any of its Subsidiaries.

 

SECTION 1.03     Effectiveness.  This Third Amendment shall become effective
only upon satisfaction of the following conditions precedent (the first date
upon which each such condition has been satisfied being herein called the “Third
Amendment Effective Date”):

 

(a)           The Agent shall have
received duly executed counterparts of this Third Amendment which, when taken
together, bear the authorized signatures of the Borrower, the Guarantors, the
Agent and each of the Lenders.

 

(b)           The Agent and the Lenders
shall be satisfied that the representations and warranties set forth in Section
1.02 of this Third Amendment are true and correct on and as of the Third
Amendment Effective Date and that no Default or Event of Default has occurred
and is continuing on and as of the Third Amendment Effective Date.

 

(c)           The Agent shall have
received all fees and expenses to be paid by the Borrower pursuant to Section
1.04 of this Third Amendment.

 

(d)           The Agent shall have
received such other documents, legal opinions, instruments and certificates
relating to this Third Amendment as it shall reasonably request and such other
documents, legal opinions, instruments and certificates that shall be
reasonably satisfactory in form and substance to the Agent and the Lenders.  All corporate proceedings taken or to be
taken in connection with this Third Amendment and documents incidental thereto
whether or not referred to herein shall be reasonably satisfactory in form and
substance to the Agent and the Lenders.

 

SECTION 1.04     Fees
and Expenses.

 

(a)         The
Borrower shall pay to the Agent for the ratable benefit of the Lenders a fee in
connection with this Third Amendment in the aggregate amount of $500,000.

 

(b)         The
Borrower shall pay all reasonable out-of-pocket expenses incurred by Agent in
connection with the preparation, negotiation, execution and delivery of this
Third 

 

4

 

Amendment, including, but not limited to, the
reasonable fees and disbursements of counsel to the Agent.

 

SECTION 1.05     Cross-References.  References in this Third Amendment to any
Section are, unless otherwise specified, to such Section of this Third
Amendment.

 

SECTION 1.06     Instrument Pursuant to Credit Agreement.  This Third Amendment is a Loan Document
executed pursuant to the Credit Agreement and shall (unless otherwise expressly
indicated herein) be construed, administered and applied in accordance with the
terms and provisions of the Credit Agreement.

 

SECTION 1.07     Further
Acts.  Each of the parties to this
Third Amendment agrees that at any time and from time to time upon the written
request of any other party, it will execute and deliver such further documents
and do such further acts and things as such other party may reasonably request
in order to effect the purposes of this Third
Amendment.

 

SECTION 1.08     Governing
Law; Submission to Jurisdiction; Waiver of Jury Trial.

 

(a)           THIS THIRD AMENDMENT
SHALL BE INTERPRETED AND THE RIGHTS AND LIABILITIES OF THE PARTIES HERETO
DETERMINED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK;
PROVIDED THAT THE AGENT AND THE LENDERS SHALL RETAIN ALL RIGHTS ARISING UNDER
FEDERAL LAW.

 

(b)           ANY LEGAL ACTION OR
PROCEEDING WITH RESPECT TO THIS THIRD AMENDMENT OR ANY OTHER LOAN DOCUMENT MAY
BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR OF THE UNITED STATES FOR
THE SOUTHERN DISTRICT OF NEW YORK, AND BY EXECUTION AND DELIVERY OF THIS THIRD
AMENDMENT, EACH OF THE BORROWER, EACH OTHER CREDIT PARTY, THE AGENT AND THE
LENDERS CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE
NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. 
EACH OF THE BORROWER, EACH OTHER CREDIT PARTY, THE AGENT AND THE LENDERS
IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF
VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW
OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH
JURISDICTION IN RESPECT OF THIS THIRD AMENDMENT OR ANY DOCUMENT RELATED
HERETO.  NOTWITHSTANDING THE FOREGOING:  (1) THE AGENT AND THE LENDERS SHALL HAVE THE
RIGHT TO BRING ANY ACTION OR PROCEEDING AGAINST THE BORROWER OR ANY OTHER
CREDIT PARTY OR THEIR RESPECTIVE PROPERTY IN THE COURTS OF ANY OTHER
JURISDICTION THE AGENT OR THE LENDERS DEEM NECESSARY OR APPROPRIATE IN ORDER TO
REALIZE ON THE COLLATERAL OR OTHER SECURITY FOR THE OBLIGATIONS AND (2) EACH OF
THE PARTIES HERETO ACKNOWLEDGES THAT ANY APPEALS FROM THE COURTS DESCRIBED IN
THE IMMEDIATELY PRECEDING SENTENCE MAY HAVE TO BE HEARD BY A COURT LOCATED
OUTSIDE THOSE JURISDICTIONS.

 

5

 

(c)           THE BORROWER AND EACH
OTHER CREDIT PARTY HEREBY WAIVES PERSONAL SERVICE OF ANY AND ALL PROCESS UPON
IT AND CONSENTS THAT ALL SUCH SERVICE OF PROCESS MAY BE MADE BY REGISTERED MAIL
(RETURN RECEIPT REQUESTED) DIRECTED TO THE BORROWER AT ITS ADDRESS SET FORTH IN
SECTION 13.8 OF THE CREDIT AGREEMENT AND SERVICE SO MADE SHALL BE DEEMED
TO BE COMPLETED FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN SO DEPOSITED IN
THE U.S. MAILS POSTAGE PREPAID.  NOTHING
CONTAINED HEREIN SHALL AFFECT THE RIGHT OF AGENT OR THE LENDERS TO SERVE LEGAL
PROCESS BY ANY OTHER MANNER PERMITTED BY LAW.

 

(d)           THE BORROWER, EACH
OTHER CREDIT PARTY, THE LENDERS AND THE AGENT EACH IRREVOCABLY WAIVE THEIR
RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION BASED UPON
OR ARISING OUT OF OR RELATED TO THIS THIRD AMENDMENT, THE OTHER LOAN DOCUMENTS,
OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, IN ANY ACTION, PROCEEDING
OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES AGAINST ANY OTHER
PARTY OR ANY AGENT-RELATED PERSON, PARTICIPANT OR ASSIGNEE, WHETHER WITH
RESPECT TO CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE.  THE BORROWER, EACH OTHER CREDIT PARTY, THE
LENDERS AND THE AGENT EACH AGREE THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL
BE TRIED BY A COURT TRIAL WITHOUT A JURY. 
WITHOUT LIMITING THE FOREGOING, THE PARTIES FURTHER AGREE THAT THEIR
RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION AS
TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN WHOLE OR IN PART,
TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS THIRD AMENDMENT OR THE
OTHER LOAN DOCUMENTS OR ANY PROVISION HEREOF OR THEREOF.  THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT
AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT AND THE OTHER
LOAN DOCUMENTS.

 

SECTION 1.09     Counterparts.  This Third Amendment may be executed in any
number of counterparts and by the different parties hereto in separate
counterparts, each of which when so executed and delivered shall be an
original, but all of which shall together constitute one and the same
instrument.  

 

SECTION 1.10     Severability.  In case any provision in or obligation under
this Third Amendment or the other Loan Documents shall be invalid, illegal or
unenforceable in any jurisdiction, the validity, legality and enforceability of
the remaining provisions or obligations, or of such provision or obligation in
any other jurisdiction, shall not in any way be affected or impaired thereby.

 

SECTION 1.11     Benefit of Agreement.  This Third Amendment shall be binding upon
and inure to the benefit of and be enforceable by the respective successors and
assigns of the parties hereto; provided that the Borrower may not assign or
transfer any of its interest hereunder without the prior written consent of the
Lenders.

 

6

 

SECTION 1.12     Integration.  This Third Amendment represents the agreement
of the Borrower, the Guarantors, the Agent and each of the Lenders signatory
hereto with respect to the subject matter hereof, and there are no promises,
undertakings, representations or warranties relative to the subject matter
hereof not expressly set forth or referred to herein or in the other Loan
Documents.

 

SECTION 1.13     Confirmation. 
Except as expressly amended by the terms hereof, all of the terms of the
Credit Agreement and the other Loan Documents shall continue in full force and
effect and are hereby ratified and confirmed in all respects.  Each Guarantor ratifies and confirms the
Facility Guaranty as in full force and effect after giving effect to this Third
Amendment.

 

SECTION 1.14     Loan
Documents.  Except as expressly set
forth herein, the amendments provided herein shall not by implication or
otherwise limit, constitute a waiver of, or otherwise affect the rights and
remedies of the Lenders or the Agent under the Credit Agreement or any other
Loan Document, nor shall they constitute a waiver of any Event of Default, nor
shall they alter, modify, amend or in any way affect any of the terms,
conditions, obligations, covenants or agreements contained in the Credit
Agreement or any other Loan Document. 
Each of the amendments provided herein shall apply and be effective only
with respect to the provisions of the Credit Agreement specifically referred to
by such amendments.  Except as expressly
amended herein, the Credit Agreement and the other Loan Documents shall
continue in full force and effect in accordance with the provisions
thereof.  As used in the Credit
Agreement, the terms “Agreement”, “herein”, “hereinafter”, “hereunder”, “hereto”
and words of similar import shall mean, from and after the date hereof, the
Credit Agreement.

 

(Signature Pages Follow)

 

7

 

IN WITNESS WHEREOF, each
of the parties hereto has caused a counterpart of this Third Amendment to be
duly executed and delivered as of the date first above written.

 

	
   

  	
  BORROWER AND GUARANTORS:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  SPHERION CORPORATION

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Mark W. Smith

  	
   

  
	
   

  	
  Name: Mark W. Smith

  
	
   

  	
  Title: Senior Vice
  President and CFO

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  SPHERION ASSESSMENT INC.

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Mark W. Smith

  	
   

  
	
   

  	
  Name: Mark W. Smith

  
	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  SPHERION ATLANTIC ENTERPRISES
  LLC

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Mark W. Smith

  	
   

  
	
   

  	
  Name: Mark W. Smith

  
	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  SPHERION ATLANTIC RESOURCES LLC

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Mark W. Smith

  	
   

  
	
   

  	
  Name: Mark W. Smith

  
	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  SPHERION ATLANTIC WORKFORCE 

  LLC

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Mark W. Smith

  	
   

  
	
   

  	
  Name: Mark W. Smith

  
	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  SPHERION (EUROPE) INC.

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Mark W. Smith

  	
   

  
	
   

  	
  Name: Mark W. Smith

  
	
   

  	
  Title: Vice President

  

 

8

 

	
   

  	
  SPHERION FINANCIAL 

  CORPORATION

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Mark W. Smith

  	
   

  
	
   

  	
  Name: Mark W. Smith

  
	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  SPHERION PACIFIC ENTERPRISES 

  LLC

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Mark W. Smith

  	
   

  
	
   

  	
  Name: Mark W. Smith

  
	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  SPHERION PACIFIC RESOURCES 

  LLC

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Mark W. Smith

  	
   

  
	
   

  	
  Name: Mark W. Smith

  
	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  SPHERION PACIFIC WORKFORCE 

  LLC

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Mark W. Smith

  	
   

  
	
   

  	
  Name: Mark W. Smith

  
	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  SPHERION U.S. INC.

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Mark W. Smith

  	
   

  
	
   

  	
  Name: Mark W. Smith

  
	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  NORCROSS TELESERVICES L.P.

  
	
   

  	
  By: Norcross Holdings,
  LLC, its general partner

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Mark W. Smith

  	
   

  
	
   

  	
  Name: Mark W. Smith

  
	
   

  	
  Title: Vice President

  

 

9

 

	
   

  	
  NORRELL CORPORATION

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Mark W. Smith

  	
   

  
	
   

  	
  Name: Mark W. Smith

  
	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  NORRELL TEMPORARY SERVICES, 

  INC.

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Mark W. Smith

  	
   

  
	
   

  	
  Name: Mark W. Smith

  
	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  NORRELL RESOURCES 

  CORPORATION

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Mark W. Smith

  	
   

  
	
   

  	
  Name: Mark W. Smith

  
	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  ADMINISTRATIVE AGENT AND 

  COLLATERAL AGENT:

  
	
   

  	
   

  
	
   

  	
  BANK OF AMERICA, N.A.,
  as the Agent

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Mark Herdman

  	
   

  
	
   

  	
  Name: Mark Herdman

  
	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  LENDERS:

  
	
   

  	
   

  
	
   

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

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Mark Herdman

  	
   

  
	
   

  	
  Name: Mark Herdman

  
	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  JP MORGAN CHASE BANK

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Dale A. Pensgen

  	
   

  
	
   

  	
  Name: Dale A. Pensgen

  
	
   

  	
  Title: Vice President

  

 

10

 

	
   

  	
  THE CIT GROUP/ BUSINESS CREDIT,
  

  INC.

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Arthur R. Cordwell
  Jr.

  	
   

  
	
   

  	
  Name: Arthur R.
  Cordwell Jr.

  
	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  HSBC BUSINESS CREDIT (USA) INC.

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Jimmy Schwartz

  	
   

  
	
   

  	
  Name: Jimmy Schwartz

  
	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  WELLS FARGO FOOTHILL, LLC

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Lan Wong

  	
   

  
	
   

  	
  Name: Lan Wong

  
	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  LASALLE BUSINESS CREDIT, LLC, as
  

  Agent on behalf of Standard Federal Bank 

  National Association

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Steve Janson

  	
   

  
	
   

  	
  Name: Steve Janson

  
	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  PNC BANK, N.A.

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ William P. Dyer IV

  	
   

  
	
   

  	
  Name: William P. Dyer
  IV

  
	
   

  	
  Title: Vice President

  
								

 

11

 

EXHIBIT A TO THIRD AMENDMENT

 

 

SCHEDULE 1.1

 

COMMITMENTS

 

	
  Lender

  	
   

  	
  Revolving Loan 

  Commitment

  	
   

  	
  Pro Rata Share

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  (3 decimals)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bank of America,
  N.A.

  	
   

  	
  $

  	
  56,250,000

  	
   

  	
  22.500

  	
  %

  
	
  JP Morgan Chase
  Bank

  	
   

  	
  $

  	
  45,000,000

  	
   

  	
  18.000

  	
  %

  
	
  The CIT
  Group/Business Credit, Inc.

  	
   

  	
  $

  	
  42,500,000

  	
   

  	
  17.000

  	
  %

  
	
  Wells Fargo
  Foothill, LLC

  	
   

  	
  $

  	
  30,000,000

  	
   

  	
  12.000

  	
  %

  
	
  HSBC Business
  Credit (USA) Inc.

  	
   

  	
  $

  	
  30,000,000

  	
   

  	
  12.000

  	
  %

  
	
  LaSalle Business
  Credit, LLC

  	
   

  	
  $

  	
  26,250,000

  	
   

  	
  10.500

  	
  %

  
	
  PNC Bank, N.A.

  	
   

  	
  $

  	
  20,000,000

  	
   

  	
  8.000

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
  100

  	
  %

  

 

12Exhibit 10.1

 

EXECUTION COPY

 

 

CREDIT AGREEMENT

 

dated as of

 

November 1, 2004

 

among

 

SMURFIT-STONE CONTAINER CORPORATION,

as a Guarantor,

 

SMURFIT-STONE CONTAINER ENTERPRISES, INC.

and

SMURFIT-STONE CONTAINER CANADA INC.,

as Borrowers,

 

The Lenders Party Hereto,

 

JPMORGAN CHASE BANK,

as Senior Agent,

 

DEUTSCHE BANK TRUST COMPANY AMERICAS,

as Senior Agent and Administrative Agent,

 

and

 

DEUTSCHE BANK AG,

as Canadian Administrative Agent,

 

 

J.P. MORGAN SECURITIES INC.

and

DEUTSCHE BANK SECURITIES INC.,

as Joint Bookrunners and Co-Lead Arrangers

 

J.P. MORGAN CHASE BANK,

as Syndication Agent

 

BANK OF AMERICA, N.A., SCOTIA BANK and 

SOCIETE GENERALE,

as Co-Documentation Agents

 

 

 

TABLE OF CONTENTS

 

	
  ARTICLE I

  	
   

  
	
   

  	
   

  
	
  Definitions

  	
   

  
	
   

  	
   

  
	
  SECTION 1.01.  Defined Terms

  	
   

  
	
  SECTION
  1.02.  Terms Generally

  	
   

  
	
  SECTION
  1.03.  Classification of Loans and
  Borrowings

  	
   

  
	
  SECTION
  1.04.  Exchange Rate Calculations

  	
   

  
	
  SECTION
  1.05.  Pro Forma Calculations

  	
   

  
	
  SECTION
  1.06.  Accounting Terms; U.S. GAAP

  	
   

  
	
   

  	
   

  
	
  ARTICLE II

  	
   

  
	
   

  	
   

  
	
  The Credits

  	
   

  
	
   

  	
   

  
	
  SECTION
  2.01.  Commitments; Deposit Account

  	
   

  
	
  SECTION
  2.02.  Loans

  	
   

  
	
  SECTION
  2.03.  Notice of Borrowings

  	
   

  
	
  SECTION
  2.04.  Repayment of Loans; Evidence of
  Debt

  	
   

  
	
  SECTION
  2.05.  Fees; Deposit Return

  	
   

  
	
  SECTION
  2.06.  Interest on Loans

  	
   

  
	
  SECTION
  2.07.  Default Interest

  	
   

  
	
  SECTION
  2.08.  Alternate Rate of Interest

  	
   

  
	
  SECTION
  2.09.  Termination and Reduction of
  Commitments; Return of Deposits

  	
   

  
	
  SECTION
  2.10.  Conversion and Continuation of
  Borrowings

  	
   

  
	
  SECTION
  2.11.  Repayment of Term Borrowings

  	
   

  
	
  SECTION
  2.12.  Optional Prepayments

  	
   

  
	
  SECTION
  2.13.  Mandatory Prepayments

  	
   

  
	
  SECTION
  2.14.  Reserve Requirements; Change in
  Circumstances; Increased Costs

  	
   

  
	
  SECTION
  2.15.  Indemnity

  	
   

  
	
  SECTION
  2.16.  Pro Rata Treatment

  	
   

  
	
  SECTION
  2.17.  Sharing of Setoffs and
  Realization of Security

  	
   

  
	
  SECTION
  2.18.  Payments

  	
   

  
	
  SECTION
  2.19.  Taxes

  	
   

  
	
  SECTION
  2.20.  Duty to Mitigate; Replacement of
  Lenders

  	
   

  
	
  SECTION
  2.21.  Swingline Loans

  	
   

  
	
  SECTION
  2.22.  Bankers’ Acceptances

  	
   

  
	
  SECTION
  2.23.  Incremental Commitments

  	
   

  

 

 

	
  ARTICLE III

  	
   

  
	
   

  	
   

  
	
  Letters of Credit

  	
   

  
	
   

  	
   

  
	
  SECTION
  3.01.  General

  	
   

  
	
  SECTION
  3.02.  Notice of Issuance, Amendment,
  Renewal, Extension; Certain Conditions

  	
   

  
	
  SECTION
  3.03.  Expiration Date

  	
   

  
	
  SECTION
  3.04.  Participations

  	
   

  
	
  SECTION
  3.05.  Reimbursement

  	
   

  
	
  SECTION
  3.06.  Obligations Absolute

  	
   

  
	
  SECTION
  3.07.  Disbursement Procedures

  	
   

  
	
  SECTION
  3.08.  Interim Interest

  	
   

  
	
  SECTION
  3.09.  Cash Collateralization

  	
   

  
	
  SECTION
  3.10.  Replacement of a Facing Agent

  	
   

  
	
  SECTION
  3.11.  Additional Facing Agents

  	
   

  
	
  SECTION
  3.12.  Existing Letters of Credit

  	
   

  
	
   

  	
   

  
	
  ARTICLE IV

  	
   

  
	
   

  	
   

  
	
  Representations and Warranties

  	
   

  
	
   

  	
   

  
	
  SECTION
  4.01.  Organization; Powers

  	
   

  
	
  SECTION
  4.02.  Authorization

  	
   

  
	
  SECTION
  4.03.  Enforceability

  	
   

  
	
  SECTION
  4.04.  Governmental Approvals

  	
   

  
	
  SECTION
  4.05.  Financial Statements

  	
   

  
	
  SECTION
  4.06.  No Material Adverse Effect

  	
   

  
	
  SECTION
  4.07.  Title to Properties; Possession
  Under Leases

  	
   

  
	
  SECTION
  4.08.  Subsidiaries

  	
   

  
	
  SECTION
  4.09.  Litigation; Compliance with Laws

  	
   

  
	
  SECTION
  4.10.  Federal Reserve Regulations

  	
   

  
	
  SECTION
  4.11.  Investment Company Act; Public
  Utility Holding Company Act

  	
   

  
	
  SECTION
  4.12.  Tax Returns

  	
   

  
	
  SECTION
  4.13.  No Material Misstatements

  	
   

  
	
  SECTION
  4.14.  Employee Benefit Plans

  	
   

  
	
  SECTION
  4.15.  Environmental and Safety Matters

  	
   

  
	
  SECTION
  4.16.  Solvency

  	
   

  
	
  SECTION
  4.17.  Security Documents

  	
   

  
	
  SECTION
  4.18.  Labor Matters

  	
   

  
	
  SECTION
  4.19.  Location of Real Property

  	
   

  
	
  SECTION
  4.20.  Patents, Trademarks, etc

  	
   

  

 

ii

 

	
  ARTICLE V

  	
   

  
	
   

  	
   

  
	
  Conditions

  	
   

  
	
   

  	
   

  
	
  SECTION
  5.01.  All Credit Events

  	
   

  
	
  SECTION
  5.02.  Conditions Precedent to the
  Closing Date

  	
   

  
	
   

  	
   

  
	
  ARTICLE VI

  	
   

  
	
   

  	
   

  
	
  Affirmative Covenants

  	
   

  
	
   

  	
   

  
	
  SECTION
  6.01.  Existence; Businesses and Properties

  	
   

  
	
  SECTION
  6.02.  Insurance

  	
   

  
	
  SECTION
  6.03.  Payment of Taxes

  	
   

  
	
  SECTION
  6.04.  Financial Statements, Reports,
  etc

  	
   

  
	
  SECTION
  6.05.  Litigation and Other Notices

  	
   

  
	
  SECTION
  6.06.  Maintaining Records; Access to
  Properties and Inspections

  	
   

  
	
  SECTION
  6.07.  Use of Proceeds

  	
   

  
	
  SECTION
  6.08.  Compliance with Law

  	
   

  
	
  SECTION
  6.09.  Further Assurances

  	
   

  
	
  SECTION
  6.10.  Material Contracts

  	
   

  
	
  SECTION
  6.11.  Environmental Matters

  	
   

  
	
   

  	
   

  
	
  ARTICLE VII

  	
   

  
	
   

  	
   

  
	
  Negative Covenants

  	
   

  
	
   

  	
   

  
	
  SECTION
  7.01.  Indebtedness

  	
   

  
	
  SECTION
  7.02.  Liens

  	
   

  
	
  SECTION
  7.03.  Sale/Leaseback Transactions

  	
   

  
	
  SECTION
  7.04.  Investments, Loans and Advances

  	
   

  
	
  SECTION
  7.05.  Mergers, Consolidations, Sales
  of Assets and Acquisitions

  	
   

  
	
  SECTION
  7.06.  Restricted Payments

  	
   

  
	
  SECTION
  7.07.  Transactions with Stockholders
  and Affiliates

  	
   

  
	
  SECTION
  7.08.  Business

  	
   

  
	
  SECTION
  7.09.  Limitations on Debt Prepayments

  	
   

  
	
  SECTION
  7.10.  Amendment of Certain Documents

  	
   

  
	
  SECTION 7.11.  Limitation on
  Dispositions of Stock of Subsidiaries

  	
   

  
	
  SECTION 7.12.  Restrictions on
  Ability of Subsidiaries to Pay Dividends

  	
   

  
	
  SECTION 7.13.  Capital
  Expenditures

  	
   

  
	
  SECTION 7.14.  Consolidated
  Senior Secured Leverage Ratio

  	
   

  
	
  SECTION 7.15.  Interest
  Coverage Ratio

  	
   

  
	
  SECTION 7.16.  Disposition of
  Collateral and Other Assets

  	
   

  
	
  SECTION 7.17.  Fiscal Year

  	
   

  

 

iii

 

	
  ARTICLE
  VIII

  	
   

  
	
   

  	
   

  
	
  Events
  of Default

  	
   

  
	
   

  	
   

  
	
  ARTICLE IX

  	
   

  
	
   

  	
   

  
	
  The Agents

  	
   

  
	
   

  	
   

  
	
  ARTICLE X

  	
   

  
	
   

  	
   

  
	
  Collection Allocation Mechanism

  	
   

  
	
   

  	
   

  
	
  SECTION 10.01.  Implementation
  of CAM

  	
   

  
	
  SECTION 10.02.  Letters of
  Credit

  	
   

  
	
  SECTION 10.03.  Conversion

  	
   

  
	
   

  	
   

  
	
  ARTICLE XI

  	
   

  
	
   

  	
   

  
	
  Miscellaneous

  	
   

  
	
   

  	
   

  
	
  SECTION 11.01.  Notices

  	
   

  
	
  SECTION 11.02.  Survival of
  Agreement

  	
   

  
	
  SECTION 11.03.  Counterparts;
  Binding Effect

  	
   

  
	
  SECTION 11.04.  Successors and
  Assigns

  	
   

  
	
  SECTION 11.05.  Expenses;
  Indemnity

  	
   

  
	
  SECTION 11.06.  Right of Setoff

  	
   

  
	
  SECTION 11.07.  Applicable Law

  	
   

  
	
  SECTION 11.08.  Waivers;
  Amendment

  	
   

  
	
  SECTION 11.09.  Release of
  Collateral and Guarantors

  	
   

  
	
  SECTION 11.10.  Interest Rate
  Limitation

  	
   

  
	
  SECTION 11.11.  Entire
  Agreement

  	
   

  
	
  SECTION 11.12.  Waiver of Jury
  Trial

  	
   

  
	
  SECTION 11.13.  Severability

  	
   

  
	
  SECTION 11.14.  Headings

  	
   

  
	
  SECTION 11.15.  Confidentiality

  	
   

  
	
  SECTION 11.16.  Jurisdiction;
  Consent to Service of Process

  	
   

  
	
  SECTION 11.17.  Florida Real
  Property

  	
   

  
	
  SECTION 11.18.  Judgment
  Currency

  	
   

  
	
  SECTION 11.19.  Certain
  Relationships

  	
   

  
	
  SECTION 11.20.  USA Patriot Act

  	
   

  

 

iv

 

SCHEDULES:

 

	
  Schedule 1.01(a)

  	
  —

  	
  Existing Letters of Credit

  
	
  Schedule 1.01(b)

  	
  —

  	
  Material Subsidiaries

  
	
  Schedule 1.01(c)

  	
  —

  	
  Mortgaged Properties

  
	
  Schedule 1.01(d)

  	
  —

  	
  Mortgages

  
	
  Schedule 1.01(e)

  	
  —

  	
  Receivables Program
  Documents

  
	
  Schedule 2.01

  	
  —

  	
  Commitments

  
	
  Schedule 4.07

  	
  —

  	
  Certain Title Matters

  
	
  Schedule 4.08

  	
  —

  	
  Subsidiaries

  
	
  Schedule 4.09

  	
  —

  	
  Litigation and
  Compliance with Laws

  
	
  Schedule 4.15

  	
  —

  	
  Environmental Matters

  
	
  Schedule 4.17(a)

  	
  —

  	
  UCC Lien Filing Offices

  
	
  Schedule 4.17(b)

  	
  —

  	
  Canadian Lien Filing
  Offices

  
	
  Schedule 4.17(e)

  	
  —

  	
  Mortgage Filing Offices

  
	
  Schedule 4.18

  	
  —

  	
  Labor Matters

  
	
  Schedule 4.19

  	
  —

  	
  Real Properties

  
	
  Schedule 5.02(a)

  	
  —

  	
  Local Counsel

  
	
  Schedule 6.09(c)

  	
  —

  	
  Certain Non-Collateral
  Properties

  
	
  Schedule 7.01

  	
  —

  	
  Indebtedness

  
	
  Schedule 7.02(a)(iv)

  	
  —

  	
  Existing Liens

  
	
  Schedule 7.04

  	
  —

  	
  Certain Permitted
  Investments

  
	
  Schedule 7.12

  	
  —

  	
  Subsidiary Dividend
  Exceptions

  
	
   

  	
   

  	
   

  
	
  EXHIBITS:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Exhibit A

  	
  —

  	
  Form of Administrative
  Questionnaire

  
	
  Exhibit B

  	
  —

  	
  Form of Assignment and
  Acceptance

  
	
  Exhibit C

  	
  —

  	
  Form of Guarantee
  Agreement (Canadian)

  
	
  Exhibit D

  	
  —

  	
  Form of Guarantee and
  Collateral Agreement (U.S.)

  
	
  Exhibit E

  	
  —

  	
  Form of Revolving
  Facility Letter of Credit Request

  
	
  Exhibit F

  	
  —

  	
  Form of Revolving (Canadian) Facility Letter of
  Credit Request

  
	
  Exhibit G

  	
  —

  	
  Form of Deposit Funded Facility Letter of Credit
  Request

  
	
  Exhibit H

  	
  —

  	
  Form of Mortgage

  
	
  Exhibit I

  	
  —

  	
  Form of Pledge
  Agreement (Canadian)

  
	
  Exhibit J

  	
  —

  	
  Form of Security
  Agreement (Canadian)

  
	
  Exhibit K

  	
  —

  	
  Form of Notice of
  Borrowing

  
	
  Exhibit L

  	
  —

  	
  Form of Note

  
	
  Exhibit M

  	
  —

  	
  Form of Notice of
  Conversion or Continuation

  
	
  Exhibit N-1

  	
  —

  	
  Form of Opinion of U.S.
  Counsel

  
	
  Exhibit N-2

  	
  —

  	
  Form of Opinion of
  Craig A. Hunt

  
	
  Exhibit N-3

  	
  —

  	
  Form of Opinion of
  Ontario Counsel

  
	
  Exhibit N-4

  	
  —

  	
  Form of Opinion of
  Quebec Counsel

  
	
  Exhibit N-5

  	
  —

  	
  Form of Opinion of
  Canadian Tax Counsel

  
	
  Exhibit N-6

  	
  —

  	
  Form of Opinion of Nova
  Scotia Counsel

  

 

v

 

CREDIT AGREEMENT dated as of November 1, 2004, among SMURFIT-STONE
CONTAINER CORPORATION, a Delaware corporation (“SSCC”); SMURFIT-STONE
CONTAINER ENTERPRISES, INC., a Delaware corporation (“SSCE”);
SMURFIT-STONE CONTAINER CANADA INC., a corporation continued under the
Companies Act (Nova Scotia) (“SSC Canada” and, together with SSCE, the “Borrowers”);
the Lenders party hereto; JPMORGAN CHASE BANK, a New York banking corporation
(“JPMCB”), as Senior Agent, Deposit Account Agent and Deposit Funded
Facility Facing Agent; DEUTSCHE BANK TRUST COMPANY AMERICAS, a New York
banking corporation (“DB”), as Senior Agent, Administrative Agent,
Collateral Agent, Swingline Lender and Revolving Facility Facing Agent; and
DEUTSCHE BANK AG, an authorized foreign bank permitted to carry on business in
Canada and listed on Schedule III of the Bank Act (Canada) (“DB Canada”),
as Canadian Administrative Agent and Revolving (Canadian) Facility Facing
Agent.

 

SSCC and the
Borrowers have requested (a) the Tranche B Lenders (such term and each other
capitalized term used but not otherwise defined in the preamble or in this
introductory statement having the meaning specified in Article I) to
make to SSCE Tranche B Loans in U.S. Dollars in an aggregate principal amount
not in excess of U.S.$975,000,000, (b) the Tranche C Lenders to make to SSC
Canada Tranche C Loans in U.S. Dollars in an aggregate principal amount not in
excess of U.S.$300,000,000, (c) the Revolving Lenders to make to SSCE from
time to time Revolving Loans in U.S. Dollars in an aggregate principal amount
at any time outstanding not in excess of U.S.$600,000,000, (d) the Swingline
Lender to make to SSCE from time to time Swingline Loans in U.S. Dollars in an
aggregate principal amount at any time outstanding not in excess of U.S.$50,000,000,
(e) the Revolving (Canadian) Lenders to make from time to time Revolving
(Canadian) Loans (i) to SSC Canada in U.S. Dollars or in Canadian Dollars and
(ii) to SSCE in U.S. Dollars, in an aggregate principal amount at any time
outstanding not in excess of U.S.$200,000,000, and (f) the Deposit Funded
Lenders to provide and fund Deposit Funded Commitments in an aggregate amount
of U.S.$121,930,726.03.

 

SSCC and the
Borrowers also have requested (a) the Revolving Facility Facing Agent to issue
Revolving Facility Letters of Credit in an aggregate face amount at any time
outstanding not in excess of U.S.$200,000,000, (b) the Revolving (Canadian)
Facility Facing Agent to issue Revolving (Canadian) Facility Letters of Credit
in an aggregate face amount at any time outstanding not in excess of
U.S.$50,000,000 (or the Canadian Dollar Equivalent thereof) and (c) the Deposit
Funded Facility Facing Agent to issue Deposit Funded Letters of Credit in an
aggregate face amount at any time outstanding not in excess of
U.S.$121,930,726.03.

 

The proceeds
of the Tranche B Loans and Tranche C Loans to be made on the Closing Date,
together with the proceeds of the Revolving Loans and Revolving

 

 

(Canadian) Loans to be made on the Closing Date, will be used by the
Borrowers on the Closing Date to pay in full all amounts due or outstanding
under the Existing Credit Agreements and to pay related fees and expenses.  The proceeds of the Revolving Loans and
Revolving (Canadian) Loans made after the Closing Date will be used by the
Borrowers solely for general corporate purposes, including the financing of
Permitted Acquisitions and capital expenditures.  Subject to the immediately succeeding
sentence, Revolving Facility Letters of Credit and Revolving (Canadian)
Facility Letters of Credit will be used by the Borrowers and their subsidiaries
solely for general corporate purposes, and Deposit Funded Letters of Credit
will be used by SSCE solely to support its obligations in respect of the
Stevenson IRBs.  The proceeds of
Incremental Loans and other extensions of credit under the Incremental
Commitments will be used by the Borrowers for the purposes specified in the
applicable Incremental Credit Assumption Agreement.

 

The Lenders
are willing to extend such credit to the Borrowers, and the Facing Agents are
willing to issue Letters of Credit for the account of the Borrowers, on the
terms and subject to the conditions set forth herein.  Accordingly, the parties hereto agree as
follows:

 

ARTICLE I

 

Definitions

 

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

 

“ABR”,
when used in reference to any Loan or Borrowing, refers to whether such Loan,
or the Loans comprising such Borrowing, are bearing interest at a rate determined
by reference to the Alternate Base Rate.

 

“Acceptance
Fee” shall mean a fee payable in Canadian Dollars by SSC Canada to the
Canadian Administrative Agent for the account of a Revolving (Canadian) Lender
with respect to the acceptance of a B/A or the making of a B/A Equivalent Loan
on the date of such acceptance or loan, calculated on the face amount of the
B/A or the B/A Equivalent Loan at the rate per annum applicable on such date as
set forth in the row labeled “Eurodollar Revolving/ B/A Spread” in the
definition of the term “Applicable Rate” set forth herein on the basis of the
number of days in the applicable Contract Period (including the date of
acceptance and excluding the date of maturity) and a year of 365 days (it
being agreed that the rate per annum applicable to the B/A Equivalent Loan is
equivalent to the rate per annum otherwise applicable to the Bankers’
Acceptance which has been replaced by the making of such B/A Equivalent Loan
pursuant to Section 2.22).

 

“Acquisition
Indebtedness” is defined in Section 7.01(q).

 

2

 

“Adjusted
LIBO Rate” shall mean, with respect to any Eurodollar Borrowing for any
Interest Period, an interest rate per annum (rounded upwards, if necessary, to
the next 1/16 of 1%) equal to the product of (a) the LIBO Rate in effect
for such Interest Period and (b) Statutory Reserves.

 

“Administrative
Agent” shall mean DB, in its capacity as administrative agent for the
Lenders and the Facing Agents.  Unless
the context shall otherwise require, the term “Administrative Agent”, when used
in respect of payments and notices pertaining to Revolving (Canadian) Loans
made to SSC Canada or Revolving (Canadian) Facility Letters of Credit, shall
mean the Canadian Administrative Agent.

 

“Administrative
Questionnaire” shall mean an Administrative Questionnaire in the form of Exhibit A,
or any other form supplied from time to time by the Administrative Agent.

 

“Affiliate”
shall mean, when used with respect to a specified Person, another Person that
directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the Person specified.  For purposes of this definition, neither any
Lender nor any Affiliate of a Lender shall be deemed to be an Affiliate of SSCC
or any of the Subsidiaries solely by reason of its ownership of or right to
vote any Indebtedness or equity securities of SSCC or any of the Subsidiaries.

 

“After-Acquired
Mortgage Property” shall mean a parcel (or adjoining parcels) of real
property (including any improvements thereon) acquired in fee ownership by any
Loan Party after the Closing Date.

 

“Agents”
shall mean, collectively, the Senior Agents, the Administrative Agent, the
Canadian Administrative Agent, the Collateral Agent and the Deposit Account
Agent.

 

“Agreement”
shall mean this credit agreement.

 

“Alternate
Base Rate” shall mean, for any day, a rate equal to the greater of
(a) the Prime Rate (or, with respect to any ABR Revolving (Canadian) Loan,
the U.S. Base Rate) in effect on such day and (b) the Federal Funds
Effective Rate in effect on such day plus 0.50%.  Any change in the Alternate Base Rate due to
a change in the Prime Rate, the U.S. Base Rate or the Federal Funds Effective
Rate shall be effective on the effective date of such change in the Prime Rate,
the U.S. Base Rate or the Federal Funds Effective Rate, respectively.

 

“Applicable
Obligations” shall mean (a) with respect to SSCC, SSCE and any other
Domestic Subsidiary (other than any Domestic Subsidiary that is a subsidiary of
a Canadian Subsidiary), the Obligations and (b) with respect to any Canadian
Subsidiary or a subsidiary of a Canadian Subsidiary, the Canadian Obligations.

 

“Applicable
Percentage” of any (a) Revolving Lender shall mean the percentage of
the aggregate Revolving Credit Commitments represented by such Lender’s
Revolving Credit Commitment, (b) Revolving (Canadian) Lender shall mean

 

3

 

the percentage of the aggregate Revolving (Canadian) Credit Commitments
represented by such Lender’s Revolving (Canadian) Credit Commitment or
(c) Deposit Funded Lender shall mean the percentage of the aggregate
Deposit Funded Commitments represented by such Lender’s Deposit Funded
Commitment.  If the Revolving Credit
Commitments, Revolving (Canadian) Credit Commitments or Deposit Funded
Commitments, as applicable, shall have terminated or expired, the Applicable
Percentages shall be determined based upon the Revolving Credit Commitments,
Revolving (Canadian) Credit Commitments or Deposit Funded Commitments, as
applicable, most recently in effect, giving effect to any assignments.

 

“Applicable
Rate” shall mean (except as otherwise provided in the Incremental Term Loan
Assumption Agreement with respect to any Incremental Term Loan), for any day,
(a) with respect to any ABR Term Loan, 1.00% per annum, (b) with
respect to any Eurodollar Term Loan, 2.00% per annum, and (c) with respect
to (i) any ABR Revolving Loan, ABR Revolving (Canadian) Loan or Canadian
Prime Rate Loan, (ii) any Eurodollar Revolving Loan, Eurodollar Revolving
(Canadian) Loan or B/A Loan or (iii) the Commitment Fees in respect of
unused Revolving Credit Commitments and unused Revolving (Canadian) Credit
Commitments, as the case may be, the applicable percentage set forth below
under the caption (x) ”ABR Revolving/Canadian Prime Rate Spreads”,
(y) ”Eurodollar Revolving/ B/A Spreads” and (z) ”Commitment Fees”, as
the case may be, based upon the Consolidated Leverage Ratio as of the relevant
date of determination:

 

	
  Consolidated

  Leverage Ratio

  	
   

  	
  ABR Revolving/

  Canadian Prime Rate

  Spreads

  	
   

  	
  Eurodollar

  Revolving/

  B/A Spreads

  	
   

  	
  Commitment Fees

  	
   

  
	
  Greater than
  4.0x

  	
   

  	
  1.25%

  	
   

  	
  2.25%

  	
   

  	
  0.500%

  	
   

  
	
  Greater than
  3.0x but less than or equal to 4.0x

  	
   

  	
  1.00%

  	
   

  	
  2.00%

  	
   

  	
  0.500%

  	
   

  
	
  Greater than
  2.0x but less than or equal to 3.0x

  	
   

  	
  0.75%

  	
   

  	
  1.75%

  	
   

  	
  0.500%

  	
   

  
	
  Less than or
  equal to 2.0x

  	
   

  	
  0.50%

  	
   

  	
  1.50%

  	
   

  	
  0.375%

  	
   

  

 

Each change in the Applicable Rate resulting from a change in the
Consolidated Leverage Ratio shall be effective with respect to all Loans,
Commitments and Letters of Credit on the date of delivery to the Administrative
Agent of the financial statements and certificates required by Section 6.04(a)
or (b) and (c), respectively, based upon the Consolidated
Leverage Ratio as of the end of the most recent fiscal quarter included in such
financial statements so delivered, and shall remain in effect until the date
immediately preceding the next date of delivery of such financial statements
and certificates indicating another such change.  Notwithstanding the foregoing, (a) (i)
until the delivery of the financial statements and certificates required by Section
6.04(b) and (c), respectively, for the fiscal quarter ending
June 30, 2005, and (ii) at any time after the occurrence and during the
continuance of an Event of Default, the Consolidated Leverage Ratio shall be
deemed greater than 4.0 to 1.0 for purposes of determining the Applicable Rate
and (b) the 

Applicable Rate with respect to any Eurodollar Term Loan or

 

4

 

ABR Term Loan shall automatically be increased by the Yield
Differential, if any, upon the making of any Other Term Loans, as provided in Section 2.23(d).

 

“Approved
Fund” shall mean any Person (other than a natural person) that is engaged
in making, purchasing, holding or investing in bank loans and similar
extensions of credit in the ordinary course of its business and that is
administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an
entity or an Affiliate of an entity that administers or manages a Lender.

 

“Arrangers”
shall mean J.P. Morgan Securities Inc. and Deutsche Bank Securities Inc.

 

“Asset
Exchange” shall mean any transfer of operating properties or assets by SSCC
or any of the Subsidiaries to any Person in which at least 75% of the
consideration received by the transferor consists of operating properties or
assets of comparable use.

 

“Asset Sale”
shall mean the sale, transfer or other disposition (including any casualty or
condemnation) by SSCC or any Subsidiary to any Person other than a Loan Party
or a wholly owned Subsidiary of (a) any capital stock in any Person,
(b) substantially all the assets of any geographic or other division or
line of business of SSCC or any of the Subsidiaries or (c) any Real Property
or a portion of any Real Property or any other asset or assets (excluding any
assets manufactured, constructed or otherwise produced or purchased for sale to
others in the ordinary course of business, any Permitted Investments and any
Program Receivables) of SSCC or any Subsidiary; provided that none of
the following shall constitute an “Asset Sale” for purposes of this Agreement:
 (i) any sale, transfer or other disposition having a value not in
excess of U.S.$5,000,000, (ii) any sale of assets in connection with any
Permitted Equipment Financing or any Permitted Timber Financing, (iii) the
sale of assets (other than Collateral) securing any Indebtedness permitted
hereunder (other than the Loans), unless such Indebtedness shall be repaid,
redeemed or repurchased in full with the proceeds of such asset sale (or any
other payment made contemporaneously therewith) and (iv) any issuance of
capital stock by SSCC.

 

“Assignment
and Acceptance” shall mean an assignment and acceptance entered into by a
Lender and an assignee (with the consent of any Person whose consent is
required by Section 11.04(b)), in the form of Exhibit B or
such other form as shall be approved by the Administrative Agent.

 

“Attributable
Indebtedness” shall mean, with respect to any Sale/Leaseback Transaction
that does not result in a Capital Lease, at any date of determination, the
product of (a) the net proceeds from such Sale/Leaseback Transaction and
(b) a fraction, the numerator of which is the number of full years of the term
of the lease relating to the property involved in such Sale/Leaseback
Transaction (without regard to any options to renew or extend such term)
remaining at the date of the making of such computation and the denominator of
which is the number of full years of the term

 

5

 

of such lease (without regard to any options to renew or extend such
term) measured from the first day of such term.

 

“B/A
Equivalent Loan” is defined in Section 2.22(h).

 

“B/A Loan”
shall mean a Borrowing comprised of one or more Bankers’ Acceptances or, as
applicable, B/A Equivalent Loans.  For
greater certainty, all provisions of this Agreement which are applicable to
Bankers’ Acceptances are also applicable, mutatis mutandis, to B/A Equivalent
Loans.

 

“Bank Act
Security” shall mean security delivered by SSC Canada to each SSC Canada
Lender that is a bank listed under Schedule I, II or III of the Bank Act
(Canada).

 

“Bankers’
Acceptance” and “B/A” shall mean a non-interest bearing instrument
denominated in Canadian Dollars, drawn by SSC Canada and accepted by a
Revolving (Canadian) Lender in accordance with this Agreement, and shall
include a depository note within the meaning of the Depository Bills and Notes
Act (Canada) and a bill of exchange within the meaning of the Bills of Exchange
Act (Canada); and when used in conjunction with a “Loan” or a “Borrowing”,
shall include a B/A Equivalent Loan.

 

“Board”
shall mean the Board of Governors of the Federal Reserve System of the
United States.

 

“Bondholders”
shall mean any or all holders of the Bonds.

 

“Bond
Pledge Agreements” shall mean, collectively, the SSC Canada Bond Pledge
Agreement, the Francobec Company Bond Pledge Agreement, the MBI Bond Pledge
Agreement and the SMBI Bond Pledge Agreement.

 

“Bonds”
shall mean any or all of the SSC Canada Bonds, the Francobec Company Bonds, the
MBI Bonds and the SMBI Bonds.

 

“Borrowers”
is defined in the preamble to this Agreement.

 

“Borrowers’
Portion of Excess Cash Flow” shall mean, at any date of determination, the
amount of Excess Cash Flow for the preceding full fiscal year of SSCC,
commencing on or after January 1, 2005 and ending prior to the date of
determination, that (a) was not or is not required to be applied to the
prepayment of Term Loans as described in Section 2.13(c) and
(b) has not been utilized on or prior to the date of determination (i) to
make Consolidated Capital Expenditures pursuant to the first proviso in the
first sentence of Section 7.13 or (ii) to make Restricted
Payments pursuant to Section 7.06(b)(i).

 

“Borrowing”
shall mean (a) a group of Loans of the same Class and Type, and denominated in
the same currency, made, converted or continued by the Lenders on a single date
and as to which a single Interest Period is in effect or (b) a Swingline Loan.

 

6

 

“Business
Day” shall mean any day (other than a Saturday, Sunday or legal holiday in
the State of New York) on which banks are open for business in New York City
and Chicago; provided, however, that (a) when used in
connection with a Eurodollar Loan or Eurodollar Borrowing, the term “Business
Day” shall also exclude any day on which banks are not open for dealings in
dollar deposits in the London interbank market, (b) when used in connection
with a Borrowing by SSC Canada, a Borrowing denominated in Canadian Dollars or
a Revolving (Canadian) Facility Letter of Credit, the term “Business Day” shall
also exclude any day on which banks are not open for business in Toronto and
Montreal, and (c) when used in connection with a Letter of Credit, the
term “Business Day” shall also exclude any day on which banks are not open for
business in the jurisdiction in which the applicable lending office of the
applicable Facing Agent is located.

 

“Calculation
Date” shall mean (a) the last Business Day of each month, (b) the
date of each notice of borrowing of Revolving (Canadian) Loans and (c) the
Business Day preceding the issuance, amendment, extension or renewal of each
Revolving (Canadian) Facility Letter of Credit.

 

“Callable
Senior Notes” shall mean, at any time, the Senior Notes that at such time
may be redeemed by SSCE at the option of SSCE pursuant to the terms thereof.

 

“CAM”
shall mean the mechanism for the allocation and exchange of interests in the
Credit Facilities and collections thereunder established under Article X.

 

“CAM
Exchange” shall mean the exchange of the Lenders’ interests provided for in
Section 10.01.

 

“CAM
Exchange Date” shall mean the first date after the Closing Date on which
there shall occur (a) any event described in paragraph (g) or (h)
of Article VIII with respect to either Borrower or (b) an
acceleration of the maturity of Loans pursuant to Article VIII.

 

“CAM
Percentage” shall mean, as to each Lender, a fraction, expressed as a decimal,
of which (a) the numerator shall be the sum of (i) the aggregate
Designated Obligations owed to such Lender and (ii) the LC Exposure and
Swingline Exposure, if any, of such Lender, in each case immediately prior to
the CAM Exchange Date, and (b) the denominator shall be the sum of
(i) the aggregate Designated Obligations owed to all the Lenders and
(ii) the aggregate LC Exposure and Swingline Exposure of all the Lenders,
in each case immediately prior to such CAM Exchange Date.  For purposes of computing each Lender’s CAM
Percentage, all Designated Obligations which shall be denominated in Canadian
Dollars shall be translated into U.S. Dollars at the Exchange Rate in effect on
the CAM Exchange Date.

 

“Canadian
Administrative Agent” shall mean DB Canada, in its capacity as Canadian
administrative agent for the Lenders and the Revolving (Canadian) Facility
Facing Agent.

 

7

 

“Canadian
Benefit Plans” shall mean all employee benefit plans of any nature or kind
whatsoever (other than the Canadian Pension Plans) that are maintained or
contributed to by SSC Canada or any other Canadian Subsidiary.

 

“Canadian
Dollar Equivalent” shall mean, on any date of determination, with respect
to any amount in U.S. Dollars, the equivalent in Canadian Dollars of such
amount determined by the Administrative Agent using the Exchange Rate then in
effect.

 

“Canadian
Dollars” and “Cdn.$” shall mean lawful currency of Canada.

 

“Canadian
GAAP” shall mean generally accepted accounting principles in Canada, as
recommended from time to time by the Canadian Institute of Chartered
Accountants, applied on a consistent basis.

 

“Canadian
Guarantee Agreements” shall mean the Guarantee Agreement (Canadian) and
each of the other guarantee agreements executed and delivered by a Canadian
Subsidiary pursuant to Section 6.09.

 

“Canadian
Obligations” shall mean all Obligations of SSC Canada and the Canadian
Subsidiaries that are Guarantors.

 

“Canadian
Pension Plans” shall mean each plan that is considered to be a pension plan
for the purposes of the ITA or any applicable pension benefits standards
statute and/or regulation in Canada and that is established, maintained or
contributed to by SSC Canada or any other Canadian Subsidiary for its current
or former employees.

 

“Canadian
Prime Rate” shall mean, for each day in any period, a fluctuating interest
rate per annum as shall be in effect from time to time, which rate per annum
shall at all times for such day be equal to the higher of (a) the annual
rate of interest announced publicly by the Canadian Administrative Agent and in
effect as its prime rate at its principal office in Toronto, Ontario on such
day for determining interest rates on Canadian Dollar-denominated commercial
loans made in Canada and (b) 0.75% per annum above the CDOR Rate in effect
on such date.  Each change to the
Canadian Prime Rate shall be effective on the date such change is publicly
announced as being effective.

 

“Canadian
Security Agreements” shall mean the Security Agreement (Canadian) and the
Pledge Agreement (Canadian).

 

“Canadian
Subsidiaries” shall mean the Subsidiaries organized under the laws of
Canada or any province or other political subdivision thereof.

 

“Capital
Lease” is defined in the definition of the term “Capital Lease
Obligations”.

 

“Capital
Lease Obligations” of any Person shall mean the obligations of such Person
to pay rent or other amounts under any lease of (or other arrangement conveying
the right to use) real or personal property, or a combination thereof (each, a

 

8

 

“Capital Lease”), which obligations are required to be
classified and accounted for as capital leases on a balance sheet of such
Person under U.S. GAAP.  For the purposes
of this Agreement, the amount of such obligations at any time shall be the
capitalized amount thereof at such time, determined in accordance with U.S.
GAAP.

 

“Cash
Proceeds” shall mean, with respect to any Asset Sale, cash, cash
equivalents or marketable securities received from such Asset Sale, including
any insurance or condemnation proceeds and proceeds received by way of deferred
payment pursuant to a note receivable or otherwise (other than the portion of
such deferred payment constituting interest, which shall be deemed not to
constitute Cash Proceeds).

 

“CDOR Rate”
shall mean, for each day in any period, the annual rate of interest that is the
rate based on an average rate applicable to Canadian Dollar bankers’
acceptances for a term equal to the term of the relevant Contract Period (or
for a term of one month for purposes of determining the Canadian Prime Rate)
appearing on the Reuters Screen CDOR Page at approximately 10:00 a.m.,
Standard Time, on such date, or if such date is not a Business Day, on the
immediately preceding Business Day, provided that if such rate does not
appear on the Reuters Screen CDOR Page on such date as contemplated, then the
CDOR Rate on such date shall be the arithmetic average of the Discount Rate
quoted by each Schedule I Reference Bank (determined by the Canadian
Administrative Agent as of 10:00 a.m., Standard Time, on such date) which
would be applicable to Canadian Dollar bankers’ acceptances quoted by the banks
listed in Schedule I of the Bank Act (Canada) as of 10:00 a.m., Standard
Time, on such date or, if such date is not a Business Day, on the immediately
preceding Business Day.

 

“CERCLA”
is defined in Section 4.15(d).

 

A “Change
in Control” shall be deemed to have occurred if (a) a majority of the
seats (other than vacant seats) on the board of directors of SSCC shall at any
time be occupied by persons who were neither (i) nominated by the board of
directors of SSCC nor (ii) appointed by directors so nominated;
(b) any person or group (within the meaning of Rule 13d-5 of the
Securities and Exchange Act of 1934, as in effect on the date hereof) shall
own, directly or indirectly, beneficially or of record, shares representing
more than 35% of the aggregate ordinary voting power represented by the issued
and outstanding capital stock of SSCC; (c) SSCC shall cease to own,
directly or indirectly, beneficially and of record, 100% of the issued and
outstanding capital stock of SSCE; or (d) SSCE shall cease to own or
control, directly or indirectly, beneficially and of record, shares representing
100% of the aggregate ordinary voting power represented by the issued and
outstanding capital stock of SSC Canada.

 

“Change of
Law” is defined in Section 2.19(f).

 

“Class”,
when used in reference to any Loan or Borrowing, refers to whether such Loan,
or the Loans comprising such Borrowing, are Revolving Loans, Revolving
(Canadian) Loans, Tranche B Loans, Tranche C Loans, Deposit Funded
Loans, Other Term Loans or Swingline Loans and, when used in reference to any
Commitment, refers to whether such Commitment is a Revolving Credit Commitment,

 

9

 

Revolving (Canadian) Credit Commitment, Tranche B Commitment,
Tranche C Commitment, Deposit Funded Commitment, Incremental Term Loan
Commitment or the commitment of the Swingline Lender hereunder.

 

“Closing
Date” shall mean November 1, 2004.

 

“Cluster
Expenditures” shall mean capital expenditures that are mandated pursuant
to, or made to comply with,  any of 40 C.F.R. 63, Subpart MM, 40
C.F.R. 63, Subpart S, 40 C.F.R. Part 430 or 40 C.F.R. 63, Subpart DDDDD,
including any subsequent modifications or amendments thereto, and any further
rules promulgated from time to time by the U.S. Environmental Protection Agency
(or any successor governmental agency) with respect to “Effluent Limitations
Guidelines, Pretreatment Standards, and New Source Performance Standards: Pulp,
Paper, and Paperboard Category” and/or “National Emission Standards for
Hazardous Air Pollutants for Source Category: Pulp and Paper Production”.

 

“Code”
shall mean the Internal Revenue Code of 1986, or any successor statute thereto,
as the same may be amended from time to time.

 

“Collateral”
shall mean all the “Collateral” as defined in any Security Document and shall
also include the Mortgaged Properties.

 

“Collateral
Agent” shall mean DB, in its capacity as collateral agent for the Lenders
and the Facing Agents.

 

“Commitment”
shall mean, with respect to each Lender, such Lender’s Revolving Credit
Commitment, Revolving (Canadian) Credit Commitment, Tranche B Commitment,
Tranche C Commitment, Deposit Funded Commitment or Incremental Term Loan
Commitment.

 

“Commitment
Fees” is defined in Section 2.05(a).

 

“Confidential
Information Memorandum” shall mean the Confidential Information
Memorandum of SSCC dated September 2004.

 

“Consolidated
Capital Expenditures” shall mean, for any period, all amounts that
would be included as additions to property, plant and equipment and other
capital expenditures on a consolidated statement of cash flows for SSCC and its
Subsidiaries during such period in accordance with U.S. GAAP (excluding
capitalized interest but including the amount of assets leased under any
Capital Lease); provided, however, that in no event shall
Consolidated Capital Expenditures include (a) amounts expended (in compliance
with the provisions of any Mortgage, if applicable) in the replacement, repair
or reconstruction of any fixed or capital asset which was destroyed, damaged or
condemned, in whole or in part, to the extent insurance or condemnation
proceeds are receivable or have been received by SSCC or any such Subsidiary in
respect of such destruction, damage or condemnation, (b) any capital
expenditures substantially concurrently made or committed to be made with the
Net Cash Proceeds from any equity issuance by SSCC, (c) any capital
expenditures made with the Net Cash Proceeds of the

 

10

 

Pontiac Sale, (d) any Investments made pursuant to Section 7.04(l)
or (e) any Permitted Acquisitions.

 

“Consolidated
Current Assets” shall mean, as at any date of determination, the total
assets (other than cash and cash equivalents) of SSCC and its Subsidiaries on a
consolidated basis that may properly be classified as current assets in
conformity with U.S. GAAP.

 

“Consolidated
Current Liabilities” shall mean, as at any date of determination, the total
liabilities of SSCC and its Subsidiaries on a consolidated basis that may
properly be classified as current liabilities in conformity with U.S. GAAP, provided
that the current maturities of long-term Indebtedness for money borrowed of
SSCC and its Subsidiaries, any Indebtedness permitted under Section 7.01
that is classified as a current liability in conformity with U.S. GAAP and any
taxes payable solely as a result of Asset Sales shall be excluded from the
definition of Consolidated Current Liabilities.

 

“Consolidated
EBITDA” for any period shall mean Consolidated Net Income for such period, plus,
without duplication and to the extent deducted in determining such Consolidated
Net Income, (a) all Federal, state, local and foreign taxes,
(b) Consolidated Interest Expense, (c) depreciation, depletion,
amortization of intangibles and other non-cash charges or non-cash losses
deducted in determining such Consolidated Net Income, (d)  cash restructuring
and similar charges incurred during any of the fiscal years ended December 31,
2004, 2005 and 2006 in an aggregate amount of up to U.S.$10,000,000 for any
such fiscal year, and (e) any fees and expenses related to  Permitted Acquisitions, minus, to the
extent included in determining such Consolidated Net Income, any non-cash
income or non-cash gains.

 

“Consolidated
Interest Expense” shall mean, for any period, the interest expense (net of
interest income on Permitted Investments) of SSCC and its Subsidiaries for such
period determined on a consolidated basis in accordance with U.S. GAAP,
excluding any fees and expenses payable or amortized during such period by SSCC
and its consolidated Subsidiaries in connection with the amortization of deferred
debt issuance costs.  For purposes of the
foregoing, interest expense shall be determined after giving effect to any net
payments made or received by SSCC and its consolidated Subsidiaries with
respect to Swap Agreements, but excluding any gain or loss recognized under
U.S. GAAP that results from the mark-to-market valuation of any Swap Agreement.

 

“Consolidated
Leverage Ratio” shall mean, on any date of determination, the ratio
obtained by dividing (a) Indebtedness of SSCC and its consolidated
Subsidiaries on such date by (b) Consolidated EBITDA for the period of
four consecutive fiscal quarters ending on or most recently prior to such
date.  In any period of four consecutive
fiscal quarters in which a Permitted Acquisition occurs, the Consolidated Leverage
Ratio shall be determined on a pro forma basis in accordance with Section 1.05.

 

11

 

“Consolidated
Net Income” shall mean, for any period, the net income (or loss) of SSCC
and its Subsidiaries on a consolidated basis for such period taken as a single
accounting period determined in conformity with U.S. GAAP, provided that
there shall be excluded from such calculation the net gains (or losses)
associated with the sale of any asset not in the ordinary course of business.

 

“Consolidated
Senior Secured Leverage Ratio” shall mean, on any date of determination,
the ratio obtained by dividing (a) Senior Secured Indebtedness of SSCC and its
consolidated Subsidiaries on such date by (b) Consolidated EBITDA for the period
of four consecutive fiscal quarters ending on or most recently prior to such
date.  In any period of four consecutive
fiscal quarters in which a Permitted Acquisition occurs, the Consolidated
Senior Secured Leverage Ratio shall be determined on a pro forma basis in
accordance with Section 1.05.

 

“Contract
Period” shall mean the term of a B/A Loan selected by SSC Canada in
accordance with Section 2.22, commencing on the date of such B/A
Loan and expiring on a Business Day which shall be either one, two, three or
six months thereafter, provided that (a) subject to clause (b) below,
each such period shall be subject to such extensions or reductions as may be
determined by the Canadian Administrative Agent to ensure that each Contract
Period shall expire on a Business Day, and (b) no Contract Period shall
extend beyond the Revolving Credit Maturity Date.

 

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

 

“Credit
Event” is defined in Article V.

 

“Credit
Facility” shall mean a Class of Commitments and extensions of credit
thereunder.  For purposes of this
Agreement, each of the following comprises a separate Credit Facility:  (a) the Tranche B Loans,
(b) the Tranche C Loans, (c) the Revolving Commitments, the
Revolving Loans, the Swingline Loans and the Revolving Facility Letters of
Credit, (d) the Revolving (Canadian) Commitments, the Revolving (Canadian)
Loans and the Revolving (Canadian) Facility Letters of Credit, (e) the Deposit
Funded Commitments, the Deposit Funded Loans and the Deposit Funded Letters of
Credit and (f) the Incremental Term Loan Commitments and the Other Term
Loans.

 

“Credit
Transactions” is defined in Section 4.02.

 

“DB” is
defined in the preamble to this Agreement.

 

“DB Canada”
is defined in the preamble to this Agreement.

 

“Default”
shall mean any event or condition that upon notice, lapse of time or both would
constitute an Event of Default.

 

12

 

“Default
Rate” is defined in Section 2.07.

 

“Delivery
Agreements” shall mean each of the delivery agreements issued by SSC Canada
or such other applicable Canadian Subsidiary to the Collateral Agent pursuant
to which a Canadian Subsidiary delivers the Demand Debentures to the Collateral
Agent.

 

“Demand
Debentures” shall mean the demand debentures with respect to each Mortgaged
Property located in the Provinces of Ontario, Manitoba, Sasketchewan and
Alberta, or such other applicable Canadian Province (other than the Province of
Quebec) with respect to any After-Acquired Mortgage Property located in a
Canadian Province (other than the Province of Quebec) and required to be
granted as Collateral pursuant to Section 6.09, in the principal amount
of Cdn.$1,500,000,000, issued by SSC Canada or such other applicable Canadian
Subsidiary, and delivered to the Collateral Agent pursuant to the Delivery
Agreements.

 

“Deposit”
shall mean, with respect to each Deposit Funded Lender at any time, the amount
actually on deposit in the Deposit Account to the credit of such Lender’s
Sub-Account at such time.

 

“Deposit
Account” shall mean the account of the Deposit Account Agent established by
the Deposit Account Agent on or prior to the Closing Date under its sole and
exclusive control solely for the purpose of being used as the “Deposit Account”
hereunder.

 

“Deposit
Account Agent” shall mean JPMCB, in its capacity as the holder of the
Deposit Account.

 

“Deposit
Funded Commitment” shall mean, with respect to each Lender, the commitment
of such Lender to acquire participations in Deposit Funded Letters of Credit
and to make Deposit Funded Loans as set forth on Schedule 2.01 or in the
Assignment and Acceptance pursuant to which such Lender assumed its Deposit
Funded Commitment, as applicable, as the same may be (a) reduced from time to
time pursuant to Section 2.09, (b) increased from time to time pursuant
to an Incremental Deposit Funded Credit Assumption Agreement entered into by
such Lender and (c) reduced or increased from time to time pursuant to
assignments by or to such Lender pursuant to Section 11.04.  As of the Closing Date, the aggregate amount
of the Deposit Funded Commitments of the Deposit Funded Lenders is
U.S.$121,930,726.03.

 

“Deposit
Funded Commitment Fee” is defined in Section 2.05(c).

 

“Deposit
Funded Facility Facing Agent” shall mean JPMCB and each Lender that
replaces JPMCB as Deposit Funded Facility Agent pursuant to Section 3.10.

 

“Deposit
Funded LC Exposure” shall mean, at any time of determination, the sum of
(a) the aggregate undrawn amount of all outstanding Deposit Funded Letters of
Credit and (b) the aggregate amount that has been drawn under any Deposit
Funded Facility Letter of Credit and has not been reimbursed by SSCE or another
Loan Party at

 

13

 

such time.  The Deposit Funded LC
Exposure of any Deposit Funded Lender at any time shall equal its Applicable
Percentage of the aggregate Deposit Funded LC Exposure at such time.

 

“Deposit
Funded Lenders” shall mean the Lenders having (a) Deposit Funded
Commitments, (b) participations in outstanding Deposit Funded Letters of Credit
or LC Disbursements in respect thereof or (c) Deposit Funded Loans.

 

“Deposit
Funded Letters of Credit” shall mean (a) the letters of credit issued for
the account of SSCE by the Deposit Funded Facility Facing Agent pursuant to the
terms and conditions of Article III and (b) the Existing IRB Letters of
Credit.  Deposit Funded Letters of Credit
shall be denominated in U.S. Dollars.

 

“Deposit
Funded Loans” shall mean the loans deemed made by the Deposit Funded
Lenders to SSCE pursuant to Section 3.05(c) in respect of their
participations in LC Disbursements in respect of the Deposit Funded Letters of
Credit.

 

“Deposit
Funded Maturity Date” shall mean the sixth anniversary of the Closing Date.

 

“Deposit
Funded Utilization” shall mean, at any time of determination, the sum of
(a) the aggregate principal amount of Deposit Funded Loans outstanding at such
time and (b) the Deposit Funded LC Exposure at such time.

 

“Deposit
Return” is defined in Section 2.05(g).

 

“Designated
Obligations” shall mean all Obligations of the Loan Parties in respect of
(a) principal of and interest on the Loans (excluding Swingline Loans, but
including B/As, B/A Equivalent Loans and Acceptance Fees with respect thereto)
and (b) Fees for the account of the Lenders, whether or not the same shall
at the time of any determination be due and payable under the terms of the Loan
Documents.

 

“Discount
Proceeds” shall mean, for any B/A (or, as applicable, any B/A Equivalent
Loan), an amount (rounded to the nearest whole cent, and with one-half of one
cent being rounded upwards) calculated on the applicable date of the Revolving
(Canadian) Credit Borrowing of which such B/A or B/A Equivalent Loan is a part
or any rollover date for such Revolving (Canadian) Credit Borrowing by
multiplying:

 

(a) the face
amount of the B/A (or, as applicable, the B/A Equivalent Loan); by

 

(b) the
quotient of one divided by the sum of one plus the product of:

 

(i) the
Discount Rate (expressed as a decimal) applicable to such B/A (or as
applicable, such B/A Equivalent Loan), and

 

14

 

(ii) a
fraction, the numerator of which is the Contract Period of the B/A (or, as
applicable, the B/A Equivalent Loan) and the denominator of which is
365 days,

 

with such
quotient being rounded up or down to the fifth decimal place, and .000005 being
rounded up.

 

“Discount Rate” shall mean:

 

(a) with respect to any Revolving (Canadian) Lender that is a
Schedule I Bank, as applicable to a B/A being purchased by such Lender on
any day, the CDOR Rate; and

 

(b) with respect to any Revolving (Canadian) Lender that is not a
Schedule I Bank, as applicable to a B/A being purchased or a B/A
Equivalent Loan being made by such Lender on any day, the lesser of
(A) the CDOR Rate plus 10 basis points (0.10%), and
(B) the average (as determined by the Canadian Administrative Agent in
good faith) of the respective percentage discount rates (expressed to two
decimal places and rounded upward, if not in an increment of 1/100th of 1%, to
the nearest 0.01%) quoted by the Schedule II Reference Banks as the
percentage discount rates at which the Schedule II Reference Banks would,
in accordance with their normal market practices, at or about 10:00 a.m.,
Standard Time, on such date, be prepared to purchase bankers’ acceptances
accepted by the Schedule II Reference Banks having a face amount and term
comparable to the face amount and term of such B/A or B/A Equivalent Loan.

 

“Domestic
Subsidiary” shall mean any Subsidiary organized under the laws of the
United States or any political subdivision thereof.

 

“Environmental
Laws” shall mean all current and future federal, state, provincial, local
and foreign laws, rules or regulations, codes, ordinances, orders, decrees,
judgments or injunctions issued, promulgated, approved or entered thereunder or
other requirements of Governmental Authorities or the common law, relating to
health, safety, or pollution or protection of the environment, including laws
relating to emissions, discharges, releases or threatened releases of, or
exposure to, pollutants, contaminants, chemicals or industrial, toxic or
hazardous substances, or wastes into the environment (including ambient air,
surface water, groundwater, land surface or subsurface strata) or otherwise
relating to the manufacture, processing, distribution, use, generation,
treatment, storage, disposal, transport or handling of pollutants,
contaminants, chemicals, or industrial, toxic or hazardous substances, or
wastes, or underground storage tanks and emissions or releases therefrom.

 

“ERISA”
shall mean the Employee Retirement Income Security Act of 1974, or any
successor statute, as the same may be amended from time to time.

 

“ERISA
Affiliate” shall mean any trade or business (whether or not incorporated)
that (a) is a member of a group of which SSCC or either Borrower is a
member and (b) is treated as a single employer under Section 414 of
the Code.

 

15

 

“ERISA
Event” shall mean (a) any “reportable event”, as defined in
Section 4043 of ERISA or the regulations issued thereunder with respect to
a Plan (other than an event for which the 30-day notice period is
waived); (b) the existence with respect to any Plan of an “accumulated
funding deficiency” (as defined in Section 412 of the Code or
Section 302 of ERISA), whether or not waived; (c) the filing pursuant
to Section 412(d) of the Code or Section 303(d) of ERISA of an
application for a waiver of the minimum funding standard with respect to any
Plan; (d) the incurrence by SSCC or any of its ERISA Affiliates of any
liability under Title IV of ERISA with respect to the termination of any
Plan; (e) the receipt by SSCC or any ERISA Affiliate from the PBGC or a
plan administrator of any notice relating to an intention to terminate any Plan
or Plans or to appoint a trustee to administer any Plan; (f) the incurrence by
SSCC or any of its ERISA Affiliates of any liability with respect to the
withdrawal or partial withdrawal from any Plan or Multiemployer Plan; (g) the
receipt by SSCC or any ERISA Affiliate of any notice, or the receipt by any
Multiemployer Plan from SSCC or any ERISA Affiliate of any notice, concerning
the imposition of Withdrawal Liability or a determination that a Multiemployer
Plan is, or is expected to be, insolvent or in reorganization, within the
meaning of Title IV of ERISA; or (h) a Governmental Authority gives
notice of its intention to terminate, in whole or in part, a Canadian Pension
Plan, or to appoint an administrator of a Canadian Pension Plan, or SSC Canada
or any of its Subsidiaries declares or gives notice of intention to declare a
wind up of a Canadian Pension Plan, in whole or in part, or any of the Canadian
Pension Plans individually or in the aggregate have an unfunded actuarial liability
or solvency deficiency (within the meaning of the Quebec Supplemental Pension
Plans Act and other applicable laws) that could reasonably be expected to have
a Material Adverse Effect.

 

“Eurodollar”,
when used in reference to any Loan or Borrowing, refers to whether such Loan,
or the Loans comprising such Borrowing, are bearing interest at a rate
determined by reference to the Adjusted LIBO Rate.

 

“Event of
Default” is defined in Article VIII.

 

“Excess
Cash Flow” shall mean, for any period, (a) the sum, without
duplication, of (i) Consolidated Net Income during such period,
(ii) the amount of depreciation, depletion, amortization of intangibles,
deferred taxes, accreted and zero coupon bond interest and other non-cash
expenses, losses or other charges that, pursuant to U.S. GAAP, were deducted in
determining such Consolidated Net Income, (iii) the proceeds of any
Capital Leases of SSCC and its Subsidiaries on a consolidated basis,
(iv) reductions, other than reductions attributable solely to Asset Sales,
to working capital for such period (i.e., the decrease in Consolidated
Current Assets minus Consolidated Current Liabilities from the beginning
to the end of such period) and (v) Indebtedness of SSCC and its
consolidated Subsidiaries created, incurred or assumed in respect of the
purchase or construction of property minus (b) the sum, without
duplication, of (i) the amount of all non-cash gains, income or other
credits included in determining Consolidated Net Income, (ii) additions to
working capital for such period (i.e., the increase in Consolidated
Current Assets minus Consolidated Current Liabilities from the beginning
to the end of such period), (iii) the Term Loan Repayment Amounts paid
during such period, (iv) optional prepayments of Term Loans described in

 

16

 

Section 2.12(b) made during such period,
(v) scheduled and optional payments or prepayments of the principal amount
of permitted Indebtedness other than the Loans, but only to the extent
that such payments or prepayments cannot by their terms be reborrowed or
redrawn and do not occur in connection with a refinancing of all or any portion
of such permitted Indebtedness and are otherwise permitted hereby,
(vi) Consolidated Capital Expenditures for such period and the aggregate
cash consideration paid by SSCC and the Subsidiaries during such period on
account of Permitted Acquisitions (except to the extent such Consolidated
Capital Expenditures or Permitted Acquisitions are financed with the Net Cash
Proceeds from an Asset Sale or an issuance of Indebtedness or equity
securities) and (vii) Restricted Payments not prohibited hereunder made
during such period; provided, however, that none of the following
shall be included in a determination of Excess Cash Flow: (x) amounts
expended for any Investment permitted under Section 7.04 and any
proceeds from the subsequent sale or other disposition of any such Investment,
(y) the proceeds of any issuance of debt or equity securities not
otherwise prohibited hereunder and (z) the proceeds from the sale of
assets of SSCC or any Subsidiary to the extent such proceeds would be required
(before giving effect to any waiver) to mandatorily prepay any permitted
Indebtedness (including the Loans).

 

“Exchange
Rate” shall mean, on any day, (a) for purposes of determining the U.S.
Dollar Equivalent, the rate at which Canadian Dollars may be exchanged into
U.S. Dollars and (b) for purposes of determining the Canadian Dollar
Equivalent, the rate at which U.S. Dollars may be exchanged into Canadian
Dollars, in each case as set forth on the Reuters World Currency Page for
Canadian Dollars (or, if not so quoted, the spot rate of exchange quoted for
wholesale transactions made by the Canadian Administrative Agent in Toronto,
Ontario) at 12:00 noon, Standard Time, on such day; provided, that
if at the time of any such determination, for any reason, no such spot rate is
being quoted, the Canadian Administrative Agent may use any reasonable method
it deems applicable to determine such rate, and such determination shall be
conclusive absent manifest error.

 

“Excluded
Subsidiaries” shall mean, collectively, JSC Timber Finance Inc., a Delaware
corporation, Timber Capital Holdings LLC, a Delaware limited liability company,
and Timber Note Holdings LLC, a Delaware limited liability company.

 

“Existing
Credit Agreements” shall mean the Existing Stone Credit Agreement and the
Existing JSCUS Credit Agreement.

 

“Existing
IRB Letters of Credit” shall mean the letters of credit issued for the account
of JSCUS under the Existing JSCUS Credit Agreement in support of JSCUS’s
obligations in respect of the Stevenson IRBs and that are outstanding on the
Closing Date and identified as “Existing IRB Letters of Credit” on Schedule 1.01(a).

 

“Existing
JSCUS Credit Agreement” shall mean the Third Amended and Restated Credit
Agreement dated as of September 26, 2002, among JSCUS, SSCC, JSCE, Inc., the
lenders party thereto, JPMCB and DB.

 

17

 

“Existing
Letters of Credit” shall mean the Existing SSC Canada Letters of Credit and
the Existing SSCE Letters of Credit.

 

“Existing
SMBI Receivables Purchase Agreement” shall mean the Receivables Purchase
Agreement dated as of March 30, 2004, between MBI, in its capacity as general
partner of SMBI and as initial servicer, Computershare Trust Company of Canada,
in its capacity as trustee of King Street Funding Trust, and Scotia Capital
Inc.

 

“Existing
SMBI Receivables Program” shall mean the trade receivables securitization
program conducted by SMBI pursuant to the Existing SMBI Receivables Purchase
Agreement and the related Receivables Program Documents.

 

“Existing
SSC Canada Letters of Credit” shall mean the letters of credit issued for
the account of SSC Canada under the Existing Stone Credit Agreement that are
outstanding on the Closing Date and identified as “Existing SSC Canada Letters
of Credit” on Schedule 1.01(a).

 

“Existing
SSCE Letters of Credit” shall mean the letters of credit issued for the
account of Stone under the Existing Credit Agreements that are outstanding on
the Closing Date and identified as “Existing SSCE Letters of Credit” on Schedule 1.01(a),
including the Existing IRB Letters of Credit.

 

“Existing
Stone Credit Agreement” shall mean the Amended and Restated Credit
Agreement dated as of July 25, 2002, as amended, among Stone, SSC Canada, the
lenders party thereto, JPMCB, DB and DB Canada.

 

“Facing
Agents” shall mean the Revolving Facility Facing Agent, the Revolving
(Canadian) Facility Facing Agent and the Deposit Funded Facility Facing Agent.

 

“Federal
Funds Effective Rate” shall mean, for any day, the weighted average of the
rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers, as published on the next
succeeding Business Day by the Federal Reserve Bank of New York or, if such
rate is not so published for any day that is a Business Day, the average of the
quotations for the day of such transactions received by the Administrative
Agent from three Federal funds brokers of recognized standing selected by it.

 

“Fees”
shall mean the fees described in Section 2.05.

 

“Financial
Officer” of any Person shall mean the chief financial officer, principal
accounting officer, treasurer, controller or assistant treasurer of such
Person.

 

“FinSub”
shall mean any special purpose bankruptcy-remote entity that is a wholly owned
Subsidiary formed solely for the purpose of purchasing receivables pursuant to
the Receivables Program, including Jefferson Smurfit Finance Corporation, a

 

18

 

Delaware corporation, Stone Receivables Corporation, a Delaware
corporation, and SSCE Funding, LLC, a Delaware limited liability company.

 

“Foreign
Subsidiary” shall mean PUI and any Subsidiary that is not a Domestic
Subsidiary.

 

“Francobec
Company Bond Pledge Agreement” shall mean the bond pledge agreement dated
as of the Closing Date, entered into between Francobec Company and the
Collateral Agent, providing the terms pursuant to which the Francobec Company
Bonds are to be held by the Collateral Agent, in its capacity as collateral
agent and depositary of the Francobec Company Bonds for the benefit of the
beneficiaries named therein.

 

“Francobec
Company Bonds” shall mean any or all of the bonds issued from time to time
by Francobec Company pursuant to the Francobec Company Hypothec.

 

“Francobec
Company Hypothec” shall mean the Indenture and Deed of Hypothec and Issue
of Bonds executed on October 24, 2004, and entered into between Francobec
Company and the Trustee, pursuant to the terms of which Francobec Company has
created, issued and secured Francobec Company Bonds in the maximum aggregate
amount of Cdn.$1,500,000,000.

 

“Governmental
Authority” shall mean any Federal, state, provincial, regional, local or
foreign court or governmental agency, authority, instrumentality or regulatory
body.

 

“Guarantee”
of or by any Person shall mean any obligation, contingent or otherwise (whether
or not denominated as a guarantee), of such Person guaranteeing any
Indebtedness of any other Person (the “primary obligor”) in any manner,
whether directly or indirectly, and including any obligation of such Person,
direct or indirect, (a) to purchase or pay (or advance or supply funds for
the purchase or payment of) such Indebtedness or to purchase (or to advance or
supply funds for the purchase of) any security for the payment of such
Indebtedness, (b) to purchase property, securities or services for the
purpose of assuring the owner of such Indebtedness of the payment of such
Indebtedness or (c) to maintain working capital, equity capital or other
financial statement condition or liquidity of the primary obligor so as to
enable the primary obligor to pay such Indebtedness; provided, however,
that the term “Guarantee” shall not include endorsements for collection or
deposit in the ordinary course of business. 
The amount of any Guarantee at any time shall be deemed to be an amount
equal to the lesser at such time of (x) the stated or determinable amount
of the primary obligation in respect of which such Guarantee is made or
(y) the maximum amount for which such Person may be liable pursuant to the
terms of the instrument embodying such Guarantee (or, if not stated or
determinable, the maximum reasonably anticipated liability in respect thereof).

 

“Guarantee
Agreement (Canadian)” shall mean the Guarantee Agreement (Canadian),
substantially in the form of Exhibit C, among the Canadian Subsidiaries

 

19

 

party thereto and the Collateral Agent, for the benefit of the secured
parties named therein.

 

“Guarantee
Agreement (Maryland)” shall mean the Guarantee Agreement (Maryland), in
form and substance reasonably satisfactory to the Collateral Agent, among the
Loan Parties party thereto and the Collateral Agent, for the benefit of the
secured parties named therein.

 

“Guarantee
Agreements” shall mean the Guarantee and Collateral Agreement (U.S.), the
Guarantee Agreement (Maryland) and the Canadian Guarantee Agreements.

 

“Guarantee
and Collateral Agreement (U.S.)” shall mean the Guarantee and Collateral
Agreement (U.S.), substantially in the form of Exhibit D, among SSCC,
the Domestic Subsidiaries party thereto and the Collateral Agent, for the
benefit of the secured parties named therein.

 

“Guarantors”
shall mean (a) SSCC and (b) each Subsidiary that guarantees the Applicable
Obligations pursuant to a Guarantee Agreement.

 

“Hazardous
Materials” is defined in Section 4.15(d).

 

“Hypothecs”
shall mean (a) each of the SSC Canada Hypothec, the Francobec Company
Hypothec, the MBI Hypothec and the SMBI Hypothec and (b) any other such
agreement entered into thereafter by a Canadian Subsidiary and the Trustee.

 

“Inactive
Subsidiary” shall mean, at any time, any Subsidiary that (a) has
assets at such time with a total market value not in excess of U.S.$100,000 and
(b) has not conducted any business or other operations during the prior 12-month
period.

 

“Incremental
Commitment” shall mean an Incremental Term Loan Commitment, Incremental
Revolving Credit Commitment, Incremental Revolving (Canadian) Credit Commitment
or Incremental Deposit Funded Commitment.

 

“Incremental
Commitment Amount” shall mean, at any time, the excess, if any, of (a)
U.S.$400,000,000 over (b) the sum of (i) the aggregate amount of all
Incremental Term Loan Commitments established prior to such time, (ii) the
aggregate amount of all Incremental Revolving Credit Commitments established
prior to such time, (iii) the aggregate amount of all Incremental Revolving
(Canadian) Credit Commitments established prior to such time and (iv) the
aggregate amount of all Incremental Deposit Funded Commitments established
prior to such time.

 

“Incremental
Credit Assumption Agreement” shall mean an Incremental Term Loan Assumption
Agreement, Incremental Revolving Credit Assumption Agreement or Incremental
Deposit Funded Credit Assumption Agreement.

 

“Incremental Deposit Funded Commitment”
shall mean the commitment of any Lender, established pursuant to Section
2.23, to acquire participations in Deposit

 

20

 

Funded Letters of Credit and to make Deposit Funded Loans as set forth
in the Incremental Deposit Funded Credit Assumption Agreement pursuant to which
such Lender acquired its Incremental Deposit Funded Commitment.

 

“Incremental Deposit Funded Credit Assumption
Agreement” shall mean an Incremental Deposit Funded Credit
Assumption Agreement, in form and substance reasonably satisfactory to the
Senior Agents, among SSCE, the Administrative Agent, the Deposit Account Agent
and one or more Incremental Deposit Funded Lenders.

 

“Incremental
Deposit Funded Lender” shall mean a Lender with an Incremental Deposit
Funded Commitment.

 

“Incremental
Lender” shall mean a Lender with an Incremental Commitment.

 

“Incremental
Loans” shall mean loans made by one or more Lenders to either Borrower
pursuant to Section 2.01(a)(iii).

 

“Incremental Revolving (Canadian) Credit
Commitment” shall mean the commitment of any Lender, established
pursuant to Section 2.23, to make Revolving (Canadian) Loans to the
Borrowers and to acquire participations in Revolving (Canadian) Facility
Letters of Credit.

 

“Incremental Revolving (Canadian) Lender”
shall mean a Lender with an Incremental Revolving (Canadian) Credit Commitment
and which, prior to any CAM Exchange and except as otherwise provided in this
Agreement, shall not be a non-resident of Canada or shall be deemed to be a
resident in Canada for purposes of Part XIII of the ITA in respect of such
Commitment.

 

“Incremental Revolving Credit Assumption
Agreement” shall mean an Incremental Revolving Credit Assumption
Agreement, in form and substance reasonably satisfactory to the Senior Agents,
among the relevant Borrower, the Administrative Agent, the Canadian Administrative
Agent (if applicable) and one or more Incremental Revolving Lenders or
Incremental Revolving (Canadian) Lenders, as applicable.

 

“Incremental Revolving Credit Commitment”
shall mean the commitment of any Lender, established pursuant to Section
2.23, to make Revolving Loans to SSCE and to acquire participations in
Revolving Facility Letters of Credit and in Swingline Loans.

 

“Incremental Revolving Lender”
shall mean a Lender with an Incremental Revolving Credit Commitment.

 

“Incremental
Term Lender” shall mean a Lender with an Incremental Term Loan Commitment
or an outstanding Incremental Term Loan.

 

“Incremental
Term Loan Assumption Agreement” shall mean an Incremental Term Loan
Assumption Agreement, in form and substance reasonably

 

21

 

satisfactory to the Senior Agents, among the relevant Borrower, the
Administrative Agent, the Canadian Administrative Agent (if applicable) and one
or more Incremental Term Lenders.

 

“Incremental
Term Loan Commitment” shall mean the commitment of any Lender, established
pursuant to Section 2.23, to make Incremental Term Loans to either
Borrower.

 

“Incremental
Term Loan Maturity Date” shall mean the final maturity date of any
Incremental Term Loan, as set forth in the applicable Incremental Term Loan
Assumption Agreement.

 

“Incremental
Term Loan Repayment Amount” is defined in Section 2.11(c).

 

“Incremental
Term Loan Repayment Dates” shall mean the dates scheduled for the repayment
of principal of any Incremental Term Loan, as set forth in the applicable
Incremental Term Loan Assumption Agreement.

 

“Incremental
Term Loans” shall mean term loans made by one or more Lenders to either
Borrower pursuant to Section 2.01(a)(iii).  Incremental Term Loans may be made in the form
of additional Tranche B Loans, additional Tranche C Loans or, to the
extent permitted by Section 2.23 and provided for in the relevant
Incremental Term Loan Assumption Agreement, Other Term Loans.

 

“Indebtedness”
of any Person shall mean, without duplication, (a) all obligations of such
Person for borrowed money, (b) all obligations of such Person evidenced by
bonds, debentures, notes or similar instruments, (c) all obligations of
such Person under conditional sale or other title retention agreements relating
to assets purchased by such Person, (d) all obligations of such Person
issued or assumed as the deferred purchase price of property or services
(excluding (i) trade accounts payable and accrued expenses arising in the
ordinary course of business and (ii) any contingent earnout or other
contingent payment obligation incurred in connection with an acquisition
permitted hereunder (but only to the extent that such obligation has not become
fixed)), (e) all Indebtedness of others secured by (or for which the
holder of such Indebtedness has an existing right, contingent or otherwise, to
be secured by) any Lien on property owned or acquired by such Person, whether
or not the obligations secured thereby have been assumed by such Person (and in
the event such Person has not assumed or otherwise become liable for payment of
such obligation, the amount of Indebtedness under this clause (e) shall
be the lesser of the amount of such obligation and the fair market value of
such property), (f) all Guarantees by such Person, (g) all Capital
Lease Obligations of such Person, (h) all net obligations of such Person
in respect of Swap Agreements (such net obligations to be equal at any time to
the termination value of such Agreements or other arrangements that would be
payable by or to such Person at such time) and (i) all obligations of such
Person as an account party to reimburse any bank or any other Person in respect
of letters of credit.  The Indebtedness
of any Person shall include the Indebtedness of any partnership in which such
Person is a general partner, except to the

 

22

 

extent such Indebtedness is expressly non-recourse to such Person.  For purposes of this Agreement,
(x) Indebtedness of a FinSub or otherwise incurred to finance the purchase
of Program Receivables pursuant to the Receivables Program and
(y) Securitization Trust Investment shall constitute secured Indebtedness
of SSCC and its Subsidiaries regardless of whether such Indebtedness or the
Securitization Trust Investment is required to be reflected as Indebtedness on
a consolidated balance sheet of SSCC and its Subsidiaries in accordance with
U.S. GAAP.

 

“Indemnitee”
is defined in Section 11.05(b).

 

“Information”
is defined in Section 11.15(a).

 

“Insolvency
Law” shall mean, to the extent applicable, (a) Title 11 of the
United States Code, (b) the Bankruptcy and Insolvency Act (Canada),
(c) the Companies’ Creditors Arrangement Act (Canada) and (d) any
similar Federal, provincial, state, local or foreign bankruptcy or insolvency
law, in each case as now constituted or hereafter amended or enacted.

 

“Interest
Coverage Ratio” shall mean, for any period, the ratio of
(a) Consolidated EBITDA for such period to (b) Consolidated Interest
Expense for such period.

 

“Interest
Payment Date” shall mean (a) with respect to any Loan, the last day of
the Interest Period applicable to the Borrowing of which such Loan is a part
and (b) with respect to any Eurodollar Borrowing with an Interest Period
of more than three months’ duration, each day that would have been an Interest
Payment Date had successive Interest Periods of three months’ duration been
applicable to such Borrowing.

 

“Interest
Period” shall mean (a) as to any Eurodollar Borrowing, the period
commencing on the date of such Borrowing or on the last day of the immediately
preceding Interest Period applicable to such Borrowing, as the case may be, and
ending on the numerically corresponding day (or, if there is no numerically
corresponding day, on the last day) in the calendar month that is 1, 2, 3 or 6
months thereafter (or, if consented to by all affected Lenders, 9 or 12 months
thereafter), or such period of time shorter than 1 month as may be agreed to by
the Administrative Agent, in each case, as the Borrower thereof may elect and
(b) as to any ABR Borrowing (including a Swingline Loan) or Canadian Prime
Rate Borrowing, the period commencing on the date of such Borrowing or on the
last day of the immediately preceding Interest Period applicable to such Borrowing,
as the case may be, and ending on the earlier of (i) the next succeeding
April 1, July 1, October 1 or January 2 and (ii) the Term Loan Maturity
Date, the Revolving Credit Maturity Date, the Deposit Funded Maturity Date or
an Incremental Term Loan Maturity Date, as applicable; provided, however,
that, if any Interest Period would end on a day other than a Business Day, such
Interest Period shall be extended to the next succeeding Business Day unless,
in the case of a Eurodollar Borrowing only, such next succeeding Business Day
would fall in the next calendar month, in which case such Interest Period shall
end on the next preceding Business Day. 
Interest shall accrue

 

23

 

from and including the first day of an Interest Period to but excluding
the last day of such Interest Period.

 

“Investment”
shall mean, as applied to any Person (the “investor”), any direct or
indirect purchase or other acquisition by the investor of, or a beneficial
interest in, stock or other securities of any other Person, including any
exchange of equity securities for Indebtedness, or any direct or indirect loan,
advance (other than advances to employees for moving and travel expenses,
drawing accounts and similar expenditures in the ordinary course of business)
or capital contribution by the investor to any other Person, including all
Indebtedness and accounts receivable owing to the investor from such other
Person that did not arise from sales or services rendered to such other Person
in the ordinary course of the investor’s business.  Except for any Investment described in the
immediately succeeding sentence, the amount of any Investment shall be the
original cost of such Investment plus the cost of all additions thereto,
without any adjustments for increases or decreases in value, or write-ups,
write-downs or write-offs with respect to such Investment minus any
amounts (a) realized upon the disposition of assets comprising an
Investment (including the value of any liabilities assumed by any Person other
than SSCC or any Subsidiary in connection with such disposition),
(b) constituting repayments of Investments that are loans or advances or
(c) constituting cash returns of principal or capital thereon (including
any dividend, redemption or repurchase of equity that is accounted for, in
accordance with U.S. GAAP, as a return of principal or capital).  For purposes of this Agreement, the
redemption, purchase or other acquisition for value by any Subsidiary of any
shares of its capital stock from a Person other than SSCC or any other
Subsidiary shall be deemed to be an “Investment” by such Subsidiary in its
shares of capital stock.

 

“IP
Security Agreements” is defined in the Guarantee and Collateral Agreement
(U.S.).

 

“ITA”
shall mean the Income Tax Act (Canada), as amended, and any successor thereto,
and any regulations promulgated thereunder.

 

“JPMCB”
is defined in the preamble to this Agreement.

 

“JSCUS”
shall mean Jefferson Smurfit Corporation (U.S.), a Delaware corporation that
was merged with and into Stone pursuant to the Merger Agreement.

 

“LC
Disbursement” shall mean any payment or disbursement made by the applicable
Facing Agent under or pursuant to a Letter of Credit.

 

“LC
Exposure” shall mean, at any time of determination, the sum of (a) the
Revolving Facility LC Exposure, (b) the Revolving (Canadian) Facility LC
Exposure and (c) the Deposit Funded Facility LC Exposure at such time.

 

“LC Reserve
Account” is defined in Section 10.02(a).

 

“Lenders”
shall mean the Persons listed on Schedule 2.01 (and their
respective successors, which shall include any entity resulting from a merger
or

 

24

 

consolidation) and any other Person that shall have become a party
hereto pursuant to an Assignment and Acceptance or an Incremental Credit
Assumption Agreement, other than any such Person that ceases to be a party
hereto pursuant to an Assignment and Acceptance.  Unless the context clearly indicates
otherwise, the term “Lenders” shall include the Swingline Lender.

 

“Letters of
Credit” shall mean the Revolving Facility Letters of Credit, the Revolving
(Canadian) Facility Letters of Credit and the Deposit Funded Letters of Credit.

 

“Letter of
Credit Request” shall mean (a) in the case of a request for issuance of a
Revolving Facility Letter of Credit, a properly completed notice in the form of
Exhibit E, (b) in the case of a request for issuance of a Revolving
(Canadian) Facility Letter of Credit, a properly completed notice in the form
of Exhibit F, and (c) in the case of a request for issuance of a Deposit
Funded Facility Letter of Credit, a properly completed notice in the form of Exhibit
G.

 

“LIBO Rate”
shall mean, with respect to any Eurodollar Borrowing for any Interest Period,
the rate appearing on Page 3750 of the Dow Jones Service (or on any successor
or substitute page of such service, or any successor to or substitute for such
service, providing rate quotations comparable to those currently provided on
such page of such service, as determined by the Administrative Agent from time
to time for purposes of providing quotations of interest rates applicable to
U.S. Dollar deposits in the London interbank market) at approximately 10:00
a.m., New York time, two Business Days prior to the commencement of such Interest
Period, as the rate for U.S. Dollar deposits with a maturity comparable to such
Interest Period.  In the event that such
rate is not available at such time for any reason, then the “LIBO Rate”
with respect to such Eurodollar Borrowing for such Interest Period shall be the
rate per annum at which U.S. Dollar deposits of U.S.$5,000,000 and for a
maturity comparable to such Interest Period are offered by the principal London
office of the Administrative Agent in immediately available funds in the London
interbank market at approximately 3:00 p.m., London time, two Business
Days prior to the commencement of such Interest Period.

 

“Lien”
shall mean, with respect to any asset, (a) any mortgage, deed of trust,
lien, pledge, assignment for security, hypothecation, prior claim (within the
meaning of the Civil Code of Quebec), encumbrance, charge or security interest
in or on such asset, and (b) the interest of a vendor or a lessor under
any conditional sale agreement, Capital Lease or title retention agreement relating
to such asset.

 

“Loan
Documents” shall mean this Agreement, the Letters of Credit, the Security
Documents, the Guarantee Agreements, the Bankers’ Acceptances and the
Incremental Credit Assumption Agreements.

 

“Loan
Documents Obligations” shall mean Obligations of the type described in
clauses (a) and (b) of the term “Obligations”.

 

“Loan
Parties” shall mean the Borrowers and the Guarantors.

 

25

 

“Loans”
shall mean the Revolving Loans, the Revolving (Canadian) Loans, the Term Loans,
the Swingline Loans and the Deposit Funded Loans.

 

“Margin
Stock” shall have the meaning given such term under Regulation U.

 

“Material
Adverse Effect” shall mean (a) a materially adverse effect on the
business, operations, properties or financial condition of SSCC and its
Subsidiaries, taken as a whole, or (b) material impairment of the rights
of or benefits available to the Agents, the Facing Agents or the Lenders under
any Loan Document.

 

“Material
Contract” shall mean any contract to which SSCC or any of the Subsidiaries
is or becomes a party that provides for payments by or to SSCC or any of the
Subsidiaries in excess of U.S.$50,000,000 per year and that has a term in
excess of twelve months.

 

“Material
Subsidiary” shall mean each Subsidiary now existing or hereafter acquired
or formed and each successor thereto that (a) for the most recent fiscal
year of SSCC accounted for more than 5% of the consolidated revenues of SSCC,
(b) as at the end of such fiscal year, was the owner of more than 5% of
the consolidated assets of SSCC as shown on the consolidated financial
statements of SSCC for such fiscal year or (c) is irrevocably designated
as a Material Subsidiary in a writing by a Loan Party to the Administrative
Agent.  Schedule 1.01(b) sets
forth each Subsidiary that is a Material Subsidiary on and as of the Closing
Date.

 

“MBI”
shall mean MBI Limited/Limitée, a corporation continued under the laws of the
Province of New Brunswick, Canada.

 

“MBI Bond
Pledge Agreement” shall mean the bond pledge agreement dated as of the
Closing Date, entered into between MBI and the Collateral Agent, providing the
terms pursuant to which the MBI Bonds are to be held by the Collateral Agent,
in its capacity as collateral agent and depositary of the MBI Bonds for the
benefit of the beneficiaries named therein.

 

“MBI Bonds”
shall mean any or all of the bonds issued from time to time by MBI pursuant to
the MBI Hypothec.

 

“MBI
Hypothec” shall mean the Indenture and Deed of Hypothec and Issue of Bonds
executed on October 24, 2004, and entered into between MBI and the
Trustee, pursuant to the terms of which MBI has created, issued and secured
MBI  Bonds in the maximum aggregate
amount of Cdn.$1,500,000,000.

 

“Merger
Agreement” shall mean the Agreement of Merger dated November 1, 2004,
between JSCUS and Stone.

 

“Merger”
shall mean the merger of JSCUS with and into Stone pursuant to the terms of the
Merger Agreement.

 

26

 

“Merger
Transactions” is defined in Section 4.02.

 

“Mortgaged
Properties” shall mean, as of the Closing Date, each parcel (or adjoining
parcels) of real property (including any real property fixtures thereon) owned
by a Loan Party and specified on Schedule 1.01(c), and shall include
each After-Acquired Mortgage Property with respect to which a Mortgage is
granted pursuant to Section 6.09.

 

“Mortgages”
shall mean (a) the mortgages, deeds of trust, Hypothecs, assignments of
leases and rents, modifications and other security documents that are listed on
Schedule 1.01(d) or delivered pursuant to Section 6.09,
(b) the Demand Debentures and (c) the Delivery Agreements.  Each Mortgage shall be substantially in the
form of Exhibit H, or otherwise in form and substance reasonably
satisfactory to the Senior Agents.

 

“Multiemployer
Plan” shall mean a multiemployer plan as defined in Section 4001(a)(3)
of ERISA to which SSCC or any ERISA Affiliate (other than one considered an
ERISA Affiliate only pursuant to subsection (m) or (o) of Section 414
of the Code) is making or accruing an obligation to make contributions, or has
within any of the preceding five plan years made or accrued an obligation to
make contributions.

 

“Net Cash
Proceeds” shall mean (a) with respect to any Asset Sale, the Cash
Proceeds therefrom, net of (i) costs of sale (including payment of the
outstanding principal amount of, premium or penalty, if any, and interest on
any Indebtedness (other than Loans) required to be repaid under the terms
thereof as a result of such Asset Sale), (ii) taxes paid or reasonably
estimated to be payable in the year such Asset Sale occurs or in the following
year as a result thereof and (iii) amounts provided as a reserve, in
accordance with U.S. GAAP, against any liabilities under any indemnification obligations
and any purchase price adjustments associated with such Asset Sale (provided
that, to the extent and at the time any such amounts are released from such
reserve, such amounts shall constitute Net Cash Proceeds); and (b) with
respect to any issuance of debt or equity securities, the cash proceeds
thereof, net of underwriting commissions or placement fees and expenses
directly incurred in connection therewith.

 

“Non-U.S.
Person” is defined in Section 2.19(f).

 

“Obligations”
shall mean (a) the due and punctual payment by each Borrower of (i) the
principal of and interest (including interest accruing during the pendency of
any bankruptcy, insolvency, receivership or other similar proceeding,
regardless of whether allowed or allowable in such proceeding) on the Loans
made to such Borrower, when and as due, whether at maturity, by acceleration,
upon one or more dates set for prepayment or otherwise, (ii) each payment
required to be made by such Borrower in respect of any Letter of Credit, when
and as due, including payments in respect of reimbursement of LC Disbursements,
interest thereon (including interest accruing during the pendency of any
bankruptcy, insolvency, receivership or other similar proceeding, regardless of
whether allowed or allowable in such proceeding) and obligations to provide
cash collateral, and (iii) all other monetary obligations of such Borrower
to any of the Agents, the Facing Agents and the Lenders under this Agreement

 

27

 

and each of the other Loan Documents, including obligations to pay
Fees, expense reimbursement obligations and indemnification obligations,
whether primary, secondary, direct, contingent, fixed or otherwise, arising
under the Loan Documents (including monetary obligations incurred during the
pendency of any bankruptcy, insolvency, receivership or other similar
proceeding, regardless of whether allowed or allowable in such proceeding),
(b) the due and punctual payment of all the monetary obligations of each
other Loan Party under or pursuant to this Agreement and each of the other Loan
Documents, (c) the due and punctual payment of all monetary obligations of
each Loan Party under each Swap Agreement that (i) is in effect on the
Closing Date with a counterparty that is a Lender or an Affiliate of a Lender
as of the Closing Date or (ii) is entered into after the Closing Date with
any counterparty that is a Lender or an Affiliate of a Lender at the time such
agreement is entered into and (d) the due and punctual payment and performance
of all obligations of each Loan Party to a Lender or an Affiliate of a Lender
in respect of cash management services (other than cash management services
provided after (i) the principal of and interest on each Loan and all Fees
payable hereunder have been paid in full, (ii) the Lenders have no further
commitment to lend hereunder, (iii) the LC Exposure has been reduced to
zero and (iv) no Facing Agent has any further obligation to issue Letters
of Credit), including obligations in respect of overdrafts, temporary advances,
interest and fees.

 

“Operations
Support Agreement” shall mean the Support Agreement, dated as of
March 30, 2004, between Stone and Computershare Trust Company of Canada,
as trustee of King Street Funding Trust.

 

“Other
Taxes” is defined in Section 2.19(b).

 

“Other Term
Loans” is defined in Section 2.23(a).

 

“Participating
Subsidiary” shall mean any Subsidiary that participates or is permitted to
participate in the Receivables Program pursuant to the Receivable Program
Documents, including SMBI.

 

“PBGC”
shall mean the Pension Benefit Guaranty Corporation referred to and defined in
ERISA or any successor thereto.

 

“Permitted
Acquisition” is defined in Section 7.05(f).

 

“Permitted
Equipment Financing” shall mean any financing transaction by SSCC or any
Subsidiary secured by equipment, or a Sale/Leaseback Transaction in which the
subject property consists of equipment, in each case owned by such Person for
more than 90 days immediately prior to such financing transaction or Sale/Leaseback
Transaction, so long as such financing transaction or Sale/Leaseback
Transaction (a) does not have a final maturity or final payment date in
respect thereof on or prior to the later of the Term Loan Maturity Date or the
Incremental Term Loan Maturity Date (if any), or a weighted average life to
maturity shorter than the weighted average life to maturity of the Term Loans,
(b) results in Net Cash Proceeds to any Loan Party in excess of 60% of the
fair market value (determined, as of the date of such financing transaction or

 

28

 

Sale/Leaseback Transaction, on the basis of an assumed arms-length
sale of such property, by a nationally recognized appraisal or valuation firm
experienced in valuing equipment) of the equipment that is the subject property
of such financing transaction or Sale/Leaseback Transaction, and
(c) contains covenants no more restrictive than those contained in this
Agreement (except that covenants that relate solely to the subject property may
be more restrictive).

 

“Permitted
Investments” shall mean any of the following:

 

(a) any evidence of Indebtedness, maturing
not more than one year after the acquisition thereof, issued by the United
States of America or Canada, or any instrumentality or agency thereof and
guaranteed fully as to principal, interest and premium, if any, by the
United States of America or Canada;

 

(b) any certificate of deposit, maturing not
more than one year after the date of purchase, issued by a commercial banking
institution that has long-term debt rated “A” or higher by Moody’s Investors
Service, Inc. (“Moody’s”) or Standard & Poor’s Ratings Services (“S&P”)
and which has a combined capital and surplus and undivided profits of not less
than U.S.$500,000,000;

 

(c) commercial paper (i) maturing not
more than 270 days after the date of purchase and (ii) issued by a
corporation (other than a Loan Party or any Affiliate of a Loan Party) with a
rating, at the time as of which any determination thereof is to be made, of “P-1”
or higher by Moody’s or “A-1” or higher by S&P (or equivalent rating
in the case of a Permitted Investment made by a Foreign Subsidiary);

 

(d) demand deposits with any bank or trust
company;

 

(e) repurchase agreements with a term of not
more than seven days with respect to Indebtedness issued by the United States
of America, or any instrumentality or agency thereof and guaranteed fully as to
principal, interest and premium, if any, by the United States of America; and

 

(f) in the case of the Foreign Subsidiaries,
short-term investments comparable to the foregoing.

 

“Permitted
Liens” shall mean, with respect to any Person, any of the following:

 

(a) Liens for taxes, assessments or other
governmental charges or levies not yet due and payable or which are being
contested in good faith by appropriate proceedings diligently pursued, provided
that (i) any proceedings commenced for the enforcement of such Liens shall
have been duly suspended and (ii) full provision for the payment of all
such taxes known to such Person has been made on the books of such Person if
and to the extent required by U.S. GAAP;

 

(b) mechanics’, materialmen’s, carriers’,
warehousemen’s, landlord’s and similar Liens arising by operation of law and in
the ordinary course of business and

 

29

 

securing obligations of such Person that are
not overdue for a period of more than 60 days or are being contested in
good faith by appropriate proceedings diligently pursued, provided that
in the case of any such contest (i) any proceedings commenced for the
enforcement of such Liens shall have been duly suspended and (ii) full
provision for the payment of such Liens has been made on the books of such
Person if and to the extent required by U.S. GAAP;

 

(c) Liens arising in connection with worker’s
compensation, unemployment insurance, old age pensions and social security
benefits that are not overdue or are being contested in good faith by
appropriate proceedings diligently pursued, provided that in the case of
any such contest (i) any proceedings commenced for the enforcement of such
Liens shall have been duly suspended and (ii) full provision for the
payment of such Liens has been made on the books of such Person if and to the
extent required by U.S. GAAP;

 

(d) (i) Liens incurred or deposits
made in the ordinary course of business to secure the performance of bids,
tenders, statutory obligations, fee and expense arrangements with trustees and
fiscal agents (exclusive of obligations incurred in connection with the
borrowing of money or the payment of the deferred purchase price of property)
and (ii) Liens securing surety, indemnity, performance, appeal and release
bonds, in the case of either clause (i) or (ii), securing
such obligations in an amount outstanding at any time not to exceed
individually or in the aggregate U.S.$100,000,000, provided that full
provision for the payment of all such obligations has been made on the books of
such Person if and to the extent required by U.S. GAAP;

 

(e) imperfections of title, covenants,
restrictions, rights of way, easements, servitudes, mineral interest
reservations, reservations made in the grant from the Crown, municipal and
zoning ordinances, general real estate taxes and assessments not yet delinquent
and other encumbrances on real property that (i) do not arise out of the
incurrence of any Indebtedness for money borrowed and (ii) do not
interfere with or impair in any material respect the utility, operation, value
or marketability of the real property on which such Lien is imposed;

 

(f) the rights of collecting banks or
other financial institutions having a right of setoff, revocation, refund or
chargeback with respect to money or instruments on deposit with or in the
possession of such financial institution;

 

(g) leases or subleases granted to
others not interfering in any material respect with the business of SSCC or any
Subsidiary and any interest or title of a lessor under any lease (whether a
Capital Lease or an operating lease) permitted by this Agreement or the Security
Documents;

 

(h) Liens on accounts receivable for
which attempts at collection have been undertaken by a third party authorized
by the Person owning such accounts receivable;

 

30

 

(i) Liens arising from the granting of a
license to enter into or use any asset of SSCC or any Subsidiary to any Person
in the ordinary course of business of SSCC or any Subsidiary that does not
interfere in any material respect with the use or application by SSCC or any
Subsidiary of the asset subject to such license;

 

(j) Liens attaching solely to cash
earnest money deposits made by SSCC or any Subsidiary in connection with any
letter of intent or purchase agreement entered into it in connection with an
acquisition permitted hereunder;

 

(k) Liens arising from precautionary UCC
financing statements (or analogous personal property security filings or
registrations in other jurisdictions) regarding operating leases;

 

(l) Liens arising by operation of law on
insurance policies and proceeds thereof to secure premiums thereunder; and

 

(m) Liens arising out of judgments or
awards in respect of which an appeal or proceeding for review is being
diligently prosecuted, provided that (i) a stay of execution pending
such appeal or proceeding for review has been obtained and (ii) full provision
for the payment of such Liens has been made on the books of such Person if and
to the extent required by U.S. GAAP.

 

For the
purposes of the Security Documents and Section 4.17, “Permitted
Liens” shall also be deemed to include the Liens permitted by Sections 7.02(a)(ii),
(iv), (v), (vi), (vii), (ix), (x), (xi),
(xiii), (xiv), (xv) and (xvi).  Any reference in any of the Loan Documents to
a Permitted Lien is not intended to and shall not be interpreted as
subordinating or postponing, or as any agreement to subordinate or postpone,
any Lien created by any of the Loan Documents to any Permitted Lien.

 

“Permitted
Timber Financing” shall mean any financing transaction by SSCC or any
Subsidiary secured by timber or timberland, or a Sale/Leaseback Transaction in
which the subject property consists of timber or timberland, in each case owned
by such Person for more than 90 days immediately prior to such financing
transaction or Sale/Leaseback Transaction, so long as such financing
transaction or Sale/Leaseback Transaction (a) does not have a final maturity or
final payment date in respect thereof on or prior to the later of the Term Loan
Maturity Date or the Incremental Term Loan Maturity Date (if any), or a weighted
average life to maturity shorter than the weighted average life to maturity of
the Term Loans, (b) results in the Net Cash Proceeds to any Loan Party in
excess of 60% of the fair market value (determined, as of the date of such
financing transaction or Sale/Leaseback Transaction, on the basis of an assumed
arms-length sale of such property, by a nationally recognized appraisal
or valuation firm experienced in valuing timber or timberland) of the timber or
timberland that is the subject property of such financing transaction or
Sale/Leaseback Transaction and (c) contains covenants no more restrictive than
those contained in this Agreement (except that covenants that relate solely to
the subject property may be more restrictive).

 

31

 

“Person”
shall mean any natural person, corporation, legal person, business trust, joint
venture, association, company, limited liability company, partnership or
government, or any agency or political subdivision thereof.

 

“Plan”
shall mean any pension plan (other than a Multiemployer Plan) subject to the
provisions of Title IV of ERISA or Section 412 of the Code that is
maintained for employees of SSCC or any ERISA Affiliate.

 

“Pledge
Agreement (Canadian)” shall mean the Pledge Agreement (Canadian),
substantially in the form of Exhibit I, among SSCE, the Canadian
Subsidiaries party thereto and the Collateral Agent, for the benefit of the
secured parties named therein.

 

“Pontiac
Sale” shall mean the sale by SSC Canada of the Pontiac, Quebec pulp mill.

 

“Prime Rate”
shall mean the rate of interest per annum publicly announced from time to time
by the Administrative Agent as its prime rate in effect at its principal office
in New York City.  Each change in the
Prime Rate shall be effective on the date such change is publicly announced as
being effective.

 

“Program
Receivables” shall mean all trade receivables and related contract and
other related rights and property (including all general intangibles,
collections and other proceeds relating thereto, all security therefor and any
goods that have been repossessed in connection with any thereof) sold or
contributed by SSCC or any Subsidiary to any FinSub or any Securitization
Entity pursuant to the Receivables Program Documents.

 

“PUI” shall
mean Packaging Unlimited, Inc., a Delaware corporation that is qualified to do
business in the Commonwealth of Puerto Rico. 
For purposes of this Agreement, PUI shall be deemed to be a Foreign
Subsidiary.

 

“Real
Properties” shall mean each parcel of real property identified on Schedule 4.19,
together with all fixtures thereon.

 

“Receivables
Programs” shall mean the trade receivables securitization programs
conducted pursuant to the Receivables Program Documents.

 

“Receivables
Program Documents” shall mean the documents identified on Schedule 1.01(e),
together with all other non-material documentation entered into pursuant to
such documentation, and any other documents and agreements that may be entered
into by SSCC or any Subsidiary pursuant to Section 7.10(c).

 

“Register”
is defined in Section 11.04(e).

 

“Regulation
T” shall mean Regulation T of the Board as from time to time in effect and
all official rulings and interpretations thereunder or thereof.

 

32

 

“Regulation
U” shall mean Regulation U of the Board as from time to time in effect and
all official rulings and interpretations thereunder or thereof.

 

“Regulation
X” shall mean Regulation X of the Board as from time to time in effect and
all official rulings and interpretations thereunder or thereof.

 

“Required
Lenders” shall mean, as of the date of determination thereof, the Lenders
having greater than 50% of the sum of the aggregate principal amount of Loans
(other than Swingline Loans), LC Exposures, Swingline Exposure and unused
Commitments.

 

“Reset Date”
is defined in Section 1.04.

 

“Responsible
Officer” of any Person shall mean the chief executive officer, president,
any Financial Officer or any vice president of such Person and any other
officer or similar official thereof responsible for the administration of the
obligations of such Person in respect of this Agreement.

 

“Restricted
Payment” shall mean (a) any dividend or other distribution, direct or
indirect, on account of any shares of any class of stock of SSCC or any of the
Subsidiaries, now or hereafter outstanding, except (i) any dividend
payable solely in shares of such class of stock to the holders of such class
and (ii) any dividend or distribution made by any Subsidiary ratably to
the holders of the capital stock of such Subsidiary, and (b) any
redemption, retirement, sinking fund or similar payment, purchase, exchange or
other acquisition for value, direct or indirect, of any shares of any class of
stock of SSCC or any of the Subsidiaries, now or hereafter outstanding, except
for any such redemption, retirement, sinking fund or similar payment payable
only to a Loan Party or payable from a Foreign Subsidiary (other than a
Canadian Subsidiary) to another Foreign Subsidiary.

 

“Revolving
(Canadian) Credit Borrowing” shall mean a Borrowing comprised of Revolving
(Canadian) Loans.

 

“Revolving
(Canadian) Credit Commitment” shall mean, with respect to each Revolving
(Canadian) Lender, the commitment of such Lender to make Revolving (Canadian)
Loans and to acquire participations in Revolving (Canadian) Facility Letters of
Credit hereunder as set forth on Schedule 2.01 or in the Assignment
and Acceptance pursuant to which such Lender assumed its Revolving (Canadian)
Credit Commitment, as applicable, as the same may be (a) reduced from time
to time pursuant to Section 2.09, (b) increased from time to
time pursuant to an Incremental Revolving Credit Assumption Agreement entered
into by such Lender and (c) reduced or increased from time to time
pursuant to assignments by or to such Lender pursuant to Section 11.04.  As of the Closing Date, the aggregate amount
of the Lenders’ Revolving (Canadian) Credit Commitments is U.S.$200,000,000.

 

“Revolving
(Canadian) Credit Utilization” shall mean, at any time of determination,
the sum of (a) the aggregate principal amount of Revolving (Canadian)
Loans outstanding at such time and denominated in U.S. Dollars, plus the
U.S. Dollar 

 

33

 

Equivalent of the aggregate principal amount of Revolving (Canadian)
Loans outstanding at such time and denominated in Canadian Dollars, and
(b) the Revolving (Canadian) Facility LC Exposure at such time.

 

“Revolving
(Canadian) Facility Facing Agent” shall mean DB Canada, each other
Revolving (Canadian) Lender that has issued an Existing SSC Canada Letter of
Credit and each Revolving (Canadian) Lender that becomes a Revolving (Canadian)
Facility Facing Agent pursuant to Section 3.10 or 3.11; provided
that DB Canada shall have no obligation to issue commercial Letters of
Credit.

 

“Revolving
(Canadian) Facility LC Exposure” shall mean, at any time of determination,
the sum of (a) the aggregate undrawn amount of all outstanding Revolving
(Canadian) Facility Letters of Credit that are denominated in U.S. Dollars, plus
the U.S. Dollar Equivalent at such time of the aggregate undrawn amount of all
Revolving (Canadian) Facility Letters of Credit that are denominated in
Canadian Dollars, and (b) the aggregate amount of all LC Disbursements in
respect of Revolving (Canadian) Facility Letters of Credit denominated in U.S.
Dollars that have not been reimbursed by SSC Canada or another Loan Party at
such time, plus the U.S. Dollar Equivalent at such time of the aggregate
amount of all LC Disbursements in respect of Revolving (Canadian) Facility
Letters of Credit denominated in Canadian Dollars that have not been reimbursed
by SSC Canada or another Loan Party at such time.  The Revolving (Canadian) Facility LC Exposure
of any Revolving (Canadian) Lender at any time shall equal its Applicable
Percentage of the aggregate Revolving (Canadian) Facility LC Exposure at such
time.

 

“Revolving
(Canadian) Facility LC Participation Fee” is defined in Section 2.05(d).

 

“Revolving
(Canadian) Facility Letters of Credit” shall mean (a) the letters of
credit issued for the account of SSC Canada by the Revolving (Canadian)
Facility Facing Agent pursuant to the terms and conditions of Article III
and (b) the Existing SSC Canada Letters of Credit.  Revolving (Canadian) Facility Letters of
Credit may be denominated in U.S. Dollars or Canadian Dollars.

 

“Revolving
(Canadian) Lenders” shall mean the Lenders having Revolving (Canadian)
Credit Commitments or holding Revolving (Canadian) Loans and which, prior to
any CAM Exchange and except as otherwise provided in this Agreement, shall not
be non-residents of Canada or shall be deemed to be residents in Canada for
purposes of Part XIII of the ITA in respect of such Commitments and Loans.

 

“Revolving
(Canadian) Loans” shall mean the revolving loans made by the Revolving
(Canadian) Lenders to SSC Canada or SSCE pursuant to Section 2.01(b)(ii).

 

“Revolving
Credit Availability Period” shall mean the period commencing with the
Closing Date and ending on the Revolving Credit Maturity Date.

 

34

 

“Revolving
Credit Borrowing” shall mean a Borrowing comprised of Revolving Loans.

 

“Revolving
Credit Commitment” shall mean, with respect to each Revolving Lender, the
commitment of such Lender to make Revolving Loans hereunder and to acquire
participations in Revolving Facility Letters of Credit and in Swingline Loans
as set forth on Schedule 2.01 or in the Assignment and Acceptance
pursuant to which such Lender assumed its Revolving Credit Commitment, as
applicable, as the same may be (a) reduced from time to time pursuant to Section 2.09,
(b) increased from time to time pursuant to an Incremental Revolving Credit
Assumption Agreement entered into by such Lender and (c) reduced or
increased from time to time pursuant to assignments by or to such Lender
pursuant to Section 11.04. 
As of the Closing Date, the aggregate amount of the Revolving Credit
Commitments of the Revolving Lenders is U.S.$600,000,000.

 

“Revolving
Credit Maturity Date” shall mean the fifth anniversary of the Closing Date.

 

“Revolving
Credit Utilization” shall mean, at any time of determination, the sum of
(a) the aggregate principal amount of Revolving Loans outstanding at such
time, (b) the Swingline Exposure at such time and (c) the Revolving
Facility LC Exposure at such time.

 

“Revolving
Facility Facing Agent” shall mean DB (or an Affiliate thereof), each other
Lender that has issued an Existing SSCE Letter of Credit and each Lender that
becomes a Revolving Facility Facing Agent pursuant to Section 3.10 or 3.11;
provided that DB shall have no obligation to issue commercial Letters of
Credit.

 

“Revolving
Facility LC Exposure” shall mean, at any time of determination, the sum of
(a) the aggregate undrawn amount of all outstanding Revolving Facility
Letters of Credit and (b) the aggregate amount that has been drawn under
any Revolving Facility Letter of Credit and has not been reimbursed by SSCE or
another Loan Party at such time.  The
Revolving Facility LC Exposure of any Revolving Lender at any time shall equal
its Applicable Percentage of the aggregate Revolving Facility LC Exposure at
such time.

 

“Revolving
Facility LC Participation Fee” is defined in Section 2.05(b).

 

“Revolving
Facility Letters of Credit” shall mean (a) the letters of credit
issued for the account of SSCE by the Revolving Facility Facing Agent pursuant
to the terms and conditions of Article III and (b) the
Existing SSCE Letters of Credit. 
Revolving Facility Letters of Credit shall be denominated in U.S.
Dollars.

 

“Revolving
Lenders” shall mean the Lenders having Revolving Credit Commitments or
holding Revolving Loans.

 

“Revolving
Loans” shall mean the revolving loans made by the Lenders to SSCE pursuant
to Section 2.01(b)(i).

 

35

 

“Sale/Leaseback
Transaction” shall mean an arrangement, direct or indirect, whereby SSCC or
any of its Subsidiaries shall sell or transfer any property, real or personal,
used or useful in its business, whether now owned or hereafter acquired, and
thereafter rent or lease such property or other property that it intends to use
for substantially the same purpose or purposes as the property sold or
transferred.

 

“Schedule I
Bank” shall mean a bank that is a Canadian chartered bank listed on
Schedule I under the Bank Act (Canada).

 

“Schedule I
Reference Banks” shall mean The Bank of Nova Scotia and such other Schedule
I Banks as are agreed from time to time by SSC Canada and the Canadian
Administrative Agent; provided  that
there shall be no more than three Schedule I Reference Banks at any one time.

 

“Schedule
II Bank” shall mean a bank that is a bank listed on Schedule II or Schedule
III under the Bank Act (Canada).

 

“Schedule II
Reference Banks” shall mean each of DB Canada and J.P. Morgan Bank Canada
and such other Schedule II Banks as are agreed to from time to time by SSC
Canada and the Canadian Administrative Agent; provided that there shall
be no more than three Schedule II Reference Banks at any one time.

 

“Securitization
Entity” shall mean any special purpose bankruptcy-remote entity that is not
a subsidiary or an Affiliate of SSCC and which is formed for the purpose of
purchasing receivables in arms’ length transactions, including Computershare
Trust Company of Canada, in its capacity as trustee of King Street Funding
Trust.

 

“Securitization
Trust Investment” shall mean (a) with respect to the Existing SMBI
Receivables Program, the Capital, as such term is defined in the Existing SMBI
Receivables Purchase Agreement, and (b) with respect to any Receivables Program
that refinances or replaces the Existing SMBI Receivables Program pursuant to Section
7.10(c), the excess of the cash purchase price paid to the seller of the
Program Receivables thereunder by the Securitization Entity over the collections
thereon, such amount to be determined in the manner reasonably satisfactory to
the Senior Agents.

 

“Security
Agreement (Canadian)” shall mean the Security Agreement (Canadian),
substantially in the form of Exhibit J hereto, among SSC Canada, the
other Canadian Subsidiaries party thereto and the Collateral Agent, for the
benefit of the secured parties named therein.

 

“Security
Documents” shall mean the Mortgages, the Guarantee and Collateral Agreement
(U.S.), the IP Security Agreements, the Canadian Security Agreements, the
Hypothecs, the Bond Pledge Agreements, the Bonds, the Bank Act Security and
each of the security agreements and other instruments and documents executed
and delivered pursuant to Section 6.09.

 

“Senior
Agents” shall mean JPMCB and DB, in their capacities as senior agents for
the Lenders and the Facing Agents.

 

36

 

“Senior
Notes” shall mean the Senior Notes due 2008, the Senior Notes due 2011, the
Senior Notes due 2012, the Senior Notes (JSCUS) due 2012, the Senior Notes due
2013, the Senior Notes (JSCUS) due 2013 and Senior Notes due 2014.

 

“Senior
Notes due 2008” shall mean SSCE’s 9-1/4% Senior Notes due 2008.

 

“Senior
Notes due 2011” shall mean SSCE’s 9-3/4% Senior Notes due 2011.

 

“Senior Notes
due 2012” shall mean SSCE’s 8-3/8% Senior Notes due 2012.

 

“Senior
Notes due 2013” shall mean SSCE’s 7-1/2% Senior Notes due 2013.

 

“Senior
Notes due 2014” shall mean the 7-3/8% Senior Notes due 2014, issued by
Stone Container Finance Company of Canada II and guaranteed by SSCE.

 

“Senior
Notes (JSCUS) due 2012” shall mean SSCE’s 8-1/4% Senior Notes due 2012.

 

“Senior
Notes (JSCUS) due 2013” shall mean SSCE’s 7-1/2% Senior Notes due 2013.

 

“Senior
Secured Indebtedness” shall mean, with respect to any Person, Indebtedness
(including in connection with the Receivables Program) of such Person that is
secured by any Lien (other than a Permitted Lien).

 

“SMBI”
shall mean Smurfit-MBI, a limited partnership organized under the laws of the
Province of Ontario, Canada.

 

“SMBI Bond
Pledge Agreement” shall mean the bond pledge agreement dated as of the
Closing Date, entered into between SMBI and the Collateral Agent, providing the
terms pursuant to which the SMBI Bonds are to be held by the Collateral Agent,
in its capacity as collateral agent and depositary of the SMBI Bonds for the
benefit of the beneficiaries named therein.

 

“SMBI Bonds”
shall mean any or all of the bonds issued from time to time by SMBI pursuant to
the SMBI Hypothec.

 

“SMBI
Hypothec” shall mean the Indenture and Deed of Hypothec and Issue of Bonds
executed on October 24, 2004, and entered into between SMBI and the
Trustee, pursuant to the terms of which MBI has created, issued and secured
SMBI  Bonds in the maximum aggregate
amount of Cdn.$1,500,000,000.

 

37

 

“Special
Purpose Finance Subsidiary” shall mean a Subsidiary organized
exclusively to be the issuer or co-issuer of Indebtedness that engages in no
other business activity and owns no assets.

 

“Specified
Long-Term Indebtedness” shall mean any Indebtedness incurred or permitted
to be incurred under Section 7.01(b), (e), (m), (o)
(to the extent such Indebtedness is subordinated Indebtedness), (p), (q),
(s), or (t).

 

“SSCC”
is defined in the preamble to this Agreement.

 

“SSC Canada”
is defined in the preamble to this Agreement.

 

“SSC Canada
Bond Pledge Agreement” shall mean the bond pledge agreement dated as of the
Closing Date, entered into between SSC Canada and the Collateral Agent,
providing the terms pursuant to which the SSC Canada Bonds are to be held by
the Collateral Agent, in its capacity as collateral agent and depositary of the
SSC Canada Bonds for the benefit of the beneficiaries named therein.

 

“SSC Canada
Bonds” shall mean any or all of the bonds issued from time to time by SSC
Canada pursuant to the SSC Canada Hypothec.

 

“SSC Canada
Hypothec” shall mean the Indenture and Deed of Hypothec and Issue of Bonds
executed on October 24, 2004, and entered into between SSC Canada and the
Trustee, pursuant to the terms of which SSC Canada has created, issued and
secured SSC Canada Bonds in the maximum aggregate amount of Cdn.$1,500,000,000.

 

“SSC Canada
Lender” shall mean any Lender that shall have made, or shall have a
Commitment to make, a Loan to SSC Canada.

 

“SSC Canada
Loan” shall mean any Loan made to SSC Canada.

 

“SSCC
Common Stock” shall mean the Common Stock, par value $0.01 per share, of
SSCC.

 

“SSCC
Convertible Subordinated Exchange Debentures” shall mean the 7% Convertible
Subordinated Exchange Debentures due 2012 issuable by SSCC pursuant to the
terms of the SSCC Series A Preferred Stock in exchange therefor.

 

“SSCC
Series A Preferred Stock” shall mean the Series A Cumulative Convertible
Exchangeable Preferred Stock, par value $0.01 per share, of SSCC.

 

“SSCE”
is defined in the preamble to this Agreement.

 

“SSCE
Lender” shall mean any Lender that shall have made, or shall have a
Commitment to make, a Loan to SSCE.

 

“SSCE Loan”
shall mean any Loan made to SSCE.

 

38

 

“Standard
Time” shall mean eastern standard time or eastern daylight savings time, as
applicable on the relevant date.

 

“Statutory
Reserves” shall mean a fraction (expressed as a decimal), the numerator of
which is the number one and the denominator of which is the number one minus
the aggregate of the maximum applicable reserve percentages, including any
marginal, special, emergency or supplemental reserves (expressed as a decimal)
established by the Board and any other banking authority to which the
Administrative Agent is subject for Eurocurrency Liabilities (as defined in
Regulation D of the Board).  Eurodollar
Loans shall be deemed to constitute Eurocurrency Liabilities and to be subject to
such reserve requirements without benefit of or credit for proration,
exemptions or offsets that may be available from time to time to any Lender
under such Regulation D.  Statutory
Reserves shall be adjusted automatically on and as of the effective date of any
change in any reserve percentage.

 

“Stevenson
IRBs” shall mean the Environmental Improvement Revenue Bonds and
Environmental Improvement Revenue Refunding Bonds issued by The Industrial
Development Board of the City of Stevenson, Alabama, and Guaranteed by Stone.

 

“Stone”
shall mean Stone Container Corporation, a Delaware corporation into which JSCUS
merged pursuant to the Merger Agreement and which, following the Merger, has
changed its name to Smurfit-Stone Container Enterprises, Inc.

 

“Sub-Account”
is defined in Section 2.04(c).

 

“subsidiary”
shall mean, with respect to any Person (herein referred to as the “parent”),
any corporation, partnership, association or other business entity of which
securities or other ownership interests representing more than 50% of the
equity or more than 50% of the ordinary voting power or more than 50% of the
general partnership or membership interests are, at the time any determination
is being made, owned, controlled or held by, or otherwise Controlled by, the
parent or one or more subsidiaries of the parent or by the parent and one or
more subsidiaries of the parent.

 

“Subsidiary”
shall mean any direct or indirect subsidiary of SSCC; provided, however,
that the term “Subsidiary” shall not include (a) any Inactive Subsidiary
and (b) any Excluded Subsidiary.

 

“Swap
Agreement” shall mean any agreement with respect to any swap, forward,
future or derivative transaction or option or similar agreement involving, or
settled by reference to, one or more rates, currencies, commodities, equity or
debt instruments or securities, or economic, financial or pricing indices or
measures of economic, financial or pricing risk or value or any similar
transaction or any combination of these transactions; provided that no
phantom stock or similar plan providing for payments only on account of
services provided by current or former directors, officers, employees or
consultants of SSCC or the Subsidiaries shall be a Swap Agreement.

 

39

 

“Swingline
Exposure” shall mean, at any time, the aggregate principal amount of the
Swingline Loans outstanding at such time. 
The Swingline Exposure of any Revolving Lender at any time shall equal
its Applicable Percentage of the aggregate Swingline Exposures at such time.

 

“Swingline
Lender” shall mean DB, in its capacity as the maker of Swingline Loans
hereunder.

 

“Swingline
Loans” shall mean the swingline loans made by the Swingline Lender pursuant
to Section 2.21.

 

“Taxes”
is defined in Section 2.19(a).

 

“Term
Borrowing” shall mean a Borrowing comprised of Tranche B Loans,
Tranche C Loans or Other Term Loans.

 

“Term
Lenders” shall mean, collectively, the Tranche B Lenders, the
Tranche C Lenders and any Incremental Term Lenders.

 

“Term Loan
Commitments” shall mean, collectively, the Tranche B Commitments and
the Tranche C Commitments.  Unless
the context shall otherwise require, after the effectiveness of any Incremental
Term Loan Commitment, the term “Term Loan Commitments” shall also include such
Incremental Term Loan Commitment.

 

“Term Loan
Maturity Date” shall mean the seventh anniversary of the Closing Date.

 

“Term Loan
Repayment Amounts” shall mean, collectively, the Tranche B Repayment
Amounts, Tranche C Repayment Amounts and Incremental Term Loan Repayment
Amounts.

 

“Term Loan
Repayment Dates” shall mean the Tranche B Repayment Dates, the
Tranche C Repayment Dates and the Incremental Term Loan Repayment Dates.

 

“Term Loans”
shall mean, collectively, the Tranche B Loans and the Tranche C
Loans.  Unless the context shall
otherwise require, the term “Term Loans” shall also include any Incremental
Term Loans.

 

“Tranche B
Borrowing” shall mean a Borrowing comprised of Tranche B Loans.

 

“Tranche B
Commitment” shall mean, with respect to each Lender, the commitment of such
Lender to make Tranche B Loans hereunder as set forth on Schedule 2.01
or in the Assignment and Acceptance pursuant to which such Lender assumed its
Tranche B Commitment, as applicable, as the same may be (a) reduced
from time to time pursuant to Section 2.09, (b) increased from time
to time pursuant to an

 

40

 

Incremental Term Loan Assumption Agreement entered into by such Lender
and (c) reduced or increased from time to time pursuant to assignments by
or to such Lender pursuant to Section 11.04.  As of the Closing Date, the aggregate amount
of the Lenders’ Tranche B Commitments is U.S.$975,000,000.

 

“Tranche B
Lenders” shall mean the Lenders having Tranche B Commitments or
holding Tranche B Loans.

 

“Tranche B
Loans” shall mean the term loans made by the Lenders to SSCE pursuant to Section 2.01(a)(i)
or, if the terms thereof are identical thereto, Section 2.01(a)(iii).

 

“Tranche B
Repayment Amount” is defined in Section 2.11(a).

 

“Tranche B
Repayment Date” is defined in Section 2.11(a).

 

“Tranche C
Borrowing” shall mean a Borrowing comprised of Tranche C Loans.

 

“Tranche C
Commitment” shall mean, with respect to each Lender, the commitment of such
Lender to make Tranche C Loans hereunder as set forth on Schedule 2.01
or in the Assignment and Acceptance pursuant to which such Lender assumed its
Tranche C Commitment, as applicable, as the same may be (a) reduced
from time to time pursuant to Section 2.09, (b) increased from
time to time pursuant to an Incremental Term Loan Assumption Agreement entered
into by such Lender and (c) reduced or increased from time to time
pursuant to assignments by or to such Lender pursuant to Section 11.04.  As of the Closing Date, the aggregate amount
of the Lenders’ Tranche C Commitments is U.S.$300,000,000.

 

“Tranche C
Lenders” shall mean the Lenders having Tranche C Commitments or
holding Tranche C Loans.

 

“Tranche C
Loans” shall mean the term loans made by the Lenders to SSC Canada pursuant
to Section 2.01(a)(ii) or, if the terms thereof are identical
thereto, Section 2.01(a)(iii).

 

“Tranche C
Repayment Amount” is defined in Section 2.11(b).

 

“Tranche C
Repayment Date” is defined in Section 2.11(b).

 

“Transactions”
is defined in Section 4.02.

 

“Transferee”
is defined in Section 2.19(a).

 

“Trustee”
shall mean National Bank Trust Inc., a trust company constituted under An Act Respecting Trust Companies and
Savings Companies (Quebec) and Part 1 of the Companies Act (Quebec), in its
capacity as “fondé de pouvoir” (person holding the power of attorney) for the
holders of the Bonds.

 

41

 

“Type”,
when used in respect of any Loan or Borrowing, shall refer to the Rate by
reference to which interest on such Loan or on the Loans comprising such
Borrowing is determined.  For purposes
hereof, the term “Rate” shall include the Adjusted LIBO Rate, the
Alternate Base Rate, the Canadian Prime Rate and the Discount Rate applicable
to B/A and B/A Equivalent Loans.

 

“Undrawn/Unreimbursed
Deposit Funded LC Exposure” shall mean, at any time of determination, the
sum of (a) the aggregate undrawn amount of all outstanding Deposit Funded
Letters of Credit at such time and (b) the aggregate amount of all LC
Disbursements in respect of Deposit Funded Letters of Credit that have not yet
been (i) reimbursed by SSCE or another Loan Party or (ii) otherwise repaid to
the Deposit Funded Facility Facing Agent by the application of the Deposits
pursuant to Section 3.05(c).

 

“U.S. Base
Rate” shall mean the rate of interest per annum publicly announced from
time to time by the Canadian Administrative Agent as its base rate in effect at
its principal office in Toronto, Ontario for determining interest rates on U.S.
Dollar-denominated commercial loans made in Canada.  Each change in the U.S. Base Rate shall be
effective on the date such change is publicly announced as being effective.

 

“U.S.
Dollars” or “U.S. $” shall mean lawful currency of the United
States.

 

“U.S.
Dollar Equivalent” shall mean, on any date of determination, with respect
to any amount in Canadian Dollars, the equivalent in U.S. Dollars of such
amount determined by the Administrative Agent using the Exchange Rate then in
effect.

 

“U.S. GAAP”
shall mean generally accepted accounting principles in the United States,
applied on a consistent basis.

 

“U.S.
Obligations” shall mean Obligations of SSCC, SSCE and the Domestic
Subsidiaries that are Guarantors.

 

“wholly
owned”, when used in reference to any subsidiary of a Person, shall mean
any subsidiary of such Person of which securities (except for directors’
qualifying shares) or other ownership interests representing 100% of the equity
or 100% of the ordinary voting power or 100% of the general partnership or
membership interests are, at the time any determination is being made, owned,
controlled or held by such Person or one or more wholly owned subsidiaries of
such Person or by such Person and one or more wholly owned subsidiaries of such
Person.

 

“Withdrawal
Liability” shall mean liability to a Multiemployer Plan as a result of a
complete or partial withdrawal from such Multiemployer Plan, as such terms are
defined in Part I of Subtitle E of Title IV of ERISA.

 

“Yield
Differential” is defined in Section 2.23(d).

 

42

 

SECTION 1.02.  Terms Generally.  The definitions in Section 1.01
shall apply equally to both 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 shall otherwise require,
all references herein to Articles, Sections, Exhibits and Schedules shall be
deemed to be references to Articles and Sections of, and Exhibits and Schedules
to, this Agreement , and the words “herein”, “hereof” and “hereunder”, and
words of similar import, shall be construed to refer to this Agreement in its
entirety and not to any particular provision hereof.  Each reference to any Loan Document or any
other document or agreement shall be deemed to be a reference to such Loan
Document, document or agreement as amended, restated, waived, supplemented or
otherwise modified from time to time in accordance with the provisions hereof
and thereof.

 

SECTION 1.03.  Classification of Loans and Borrowings.  For the purposes of this Agreement, Loans may
be classified and referred to by Class (e.g., a “Revolving Loan”) or by
Type (e.g., a “Eurodollar Loan”) or by Class and Type (e.g., a
“Eurodollar Revolving Loan”).  Borrowings
may also be classified and referred to by Class 
(e.g., a “Revolving Borrowing”) or by Type (e.g., a
“Eurodollar Borrowing”) or by Class and Type (e.g., a “Eurodollar
Revolving Borrowing”).

 

SECTION 1.04.  Exchange Rate Calculations.  On each Calculation Date, the Canadian
Administrative Agent shall (a) determine the Exchange Rate as of such
Calculation Date and (b) give notice thereof to the Borrowers and to each
Lender that shall have requested such information.  The Exchange Rates so determined shall become
effective on the first Business Day immediately following the relevant Calculation
Date (each, a “Reset Date”) and shall remain effective until the next
succeeding Reset Date, and shall for all purposes of this Agreement (other than
Sections 2.13(e), 10.03, 11.18 and any other
provision expressly requiring the use of a current Exchange Rate) be the
Exchange Rate employed in converting amounts between U.S. Dollars and Canadian
Dollars.

 

SECTION 1.05.  Pro Forma Calculations.  With respect to any period during which any
Permitted Acquisition occurs, the Consolidated Leverage Ratio and the
Consolidated Senior Secured Leverage Ratio shall be calculated with respect to
such period (and, to the extent applicable, subsequent periods) on a pro forma
basis after giving effect to such Permitted Acquisition (including, without
duplication, (a) all pro forma adjustments permitted or required by
Article 11 of Regulation S-X under the Securities Act of 1933, as
amended, and (b) pro forma adjustments for cost savings (net of continuing
associated expenses) to the extent such cost savings are factually supportable
and have been realized or are reasonably expected to be realized within
12 months following such Permitted Acquisition, provided that such
cost savings shall be set forth in a reasonably detailed certificate of a
Financial Officer of SSCE), using, for purposes of making such calculations,
the historical financial statements of all entities or assets so acquired or to
be acquired and the consolidated financial statements of SSCC and the
Subsidiaries which shall be reformulated as if such Permitted Acquisition, and

 

43

 

any other Permitted Acquisitions that have been consummated during the
period.  In addition, solely for purposes
of determining pro forma compliance with the Interest Coverage Ratio for
purposes of Section 7.05(f), any Indebtedness incurred in
connection with such Permitted Acquisition and any other Permitted Acquisitions
that have been consummated during the period shall be assumed to have been
incurred at the beginning of such period.

 

SECTION 1.06.  Accounting
Terms; U.S. GAAP.  Except as otherwise expressly provided herein, all terms of an
accounting or financial nature shall be construed in accordance with U.S. GAAP,
as in effect from time to time; provided that, if SSCC or any Borrower
notifies the Senior Agents that it requests an amendment to any provision
hereof to eliminate the effect of any change occurring after the date hereof in
U.S. GAAP or in the application thereof on the operation of such provision (or
if a Senior Agent notifies SSCC and the Borrowers that the Required Lenders
request an amendment to any provision hereof for such purpose), regardless of
whether any such notice is given before or after such change in U.S. GAAP or in
the application thereof, then such provision shall be interpreted on the basis
of U.S. GAAP as in effect and applied immediately before such change shall have
become effective until such notice shall have been withdrawn or such
provision  amended in accordance
herewith.

 

ARTICLE II

 

The Credits

 

SECTION 2.01.  Commitments; Deposit Account.  (a) 
Subject to the terms and conditions and relying on the representations
and warranties set forth herein, (i) each Tranche B Lender agrees,
severally and not jointly, to make to SSCE on the Closing Date a Tranche B
Loan in U.S. Dollars in a principal amount equal to its Tranche B
Commitment, (ii) each Tranche C Lender agrees, severally and not
jointly, to make to SSC Canada on the Closing Date a Tranche C Loan in
U.S. Dollars in a principal amount equal to its Tranche C Commitment, and
(iii) each Incremental Term Lender agrees, severally and not jointly, to
make to either SSCE or SSC Canada an Incremental Term Loan in a principal
amount equal to its Incremental Term Loan Commitment.  Amounts paid or repaid in respect of Term
Loans may not be reborrowed.

 

(b) 
Subject to the terms and conditions and relying on the representations
and warranties set forth herein, (i) each Revolving Lender agrees,
severally and not jointly, to make to SSCE from time to time during the
Revolving Credit Availability Period Revolving Loans in U.S. Dollars in an
aggregate principal amount that will not result in such Lender’s Applicable
Percentage of the Revolving Credit Utilization exceeding such Lender’s
Revolving Credit Commitment and (ii) each Revolving (Canadian) Lender
agrees, severally and not jointly, to make from time to time during the
Revolving Credit Availability Period (A) Revolving (Canadian) Loans to SSC
Canada in U.S. Dollars or Canadian Dollars (as requested by SSC Canada as
permitted hereunder), including, in the case of Revolving (Canadian) Loans
denominated in Canadian Dollars,

 

44

 

by means of a B/A or B/A
Equivalent Loan, and (B) Revolving (Canadian) Loans to SSCE in U.S.
Dollars, in an aggregate principal amount that will not result in such Lender’s
Applicable Percentage of the Revolving (Canadian) Credit Utilization exceeding
such Lender’s Revolving (Canadian) Credit Commitment.  Within the limits set forth in the preceding
sentence, the Borrowers may borrow, pay or prepay and reborrow Revolving Loans
and Revolving (Canadian) Loans.

 

(c)  Subject
to the terms and conditions and relying on the representations and warranties
set forth herein, each Deposit Funded Lender agrees, severally and not jointly,
to remit to the Administrative Agent on the Closing Date (or, in the case of
any Incremental Deposit Funded Lender, on the date of effectiveness of the
Incremental Deposit Funded Credit Assumption Agreement pursuant to which such
Lender acquired its Incremental Deposit Funded Commitment) an amount in U.S.
Dollars equal to such Lender’s Deposit Funded Commitment (or, in the case of
such Incremental Deposit Funded Lender, such Lender’s Incremental Deposit
Funded Commitment).  The Administrative
Agent shall promptly remit all amounts received by it pursuant to the
immediately preceding sentence to the Deposit Account Agent, and the Deposit
Account Agent shall deposit all such amounts received by it into the Deposit
Account promptly upon receipt thereof. 
Each Deposit Funded Lender irrevocably and unconditionally agrees that
its Deposit shall be available (i) to pay to the Deposit Funded Facility Facing
Agent such Lender’s Applicable Percentage of LC Disbursements in respect of
Deposit Funded Letters of Credit that are not reimbursed by SSCE and (ii) to
fund such Lender’s Deposit Funded Loans, in each case, pursuant to Section
3.05(c).  Deposit Funded Loans may be
prepaid without reducing the Deposit Funded Commitments; provided, however,
that Deposit Funded Loans may not be reborrowed as such.

 

(d)  No
Person (other than the Deposit Account Agent) shall have the right to make any
withdrawal from the Deposit Account or to exercise any other right or power
with respect thereto.  Each Deposit
Funded Lender agrees that its right, title and interest in and to the Deposit
Account shall be limited to the right to require its Deposit to be applied as provided
in Section 3.05(c) and that it will have no right to require the return
of its Deposit other than as expressly provided in Section 2.09.  Each Deposit Funded Lender hereby
acknowledges that (i) its Deposit constitutes payment for its participations in
Deposit Funded Letters of Credit issued, deemed issued or to be issued
hereunder, (ii) its Deposit and any investments made therewith shall
secure its obligations to the Deposit Funded Facility Facing Agent hereunder
(each Deposit Funded Lender hereby granting to the Deposit Account Agent, for
the benefit of the Deposit Funded Facility Facing Agent, a security interest in
its Deposit and agreeing that the Deposit Account Agent, as holder of the
Deposits and any investments made therewith, will be acting as collateral agent
for the Deposit Funded Facility Facing Agent) and (iii) the Deposit Funded
Facility Facing Agent will be issuing, amending, renewing and extending Deposit
Funded Letters of Credit in reliance on the availability of such Lender’s Deposit
to discharge such Lender’s obligations in connection with any LC Disbursement
in respect thereof in accordance with Section 3.05(c).  The funding of the Deposits and the
agreements with respect thereto set forth in this Agreement constitute
arrangements among the Administrative Agent, the Deposit Account Agent, the
Deposit Funded Facility Facing Agent and the Deposit Funded Lenders with
respect to the funding

 

45

 

obligations of such Lenders
under this Agreement, and the Deposits do not constitute loans or extensions of
credit to any Loan Party.  Without
limiting the generality of the foregoing, each party hereto acknowledges and
agrees that the Deposits are and at all times will continue to be property of
the Deposit Funded Lenders, and that no amount on deposit at any time in the
Deposit Account shall be the property of any Loan Party, constitute “Collateral”
under the Loan Documents or otherwise be available in any manner to satisfy any
Obligations of any Loan Party under the Loan Documents.

 

SECTION 2.02.  Loans. 
(a)  Each Loan (other than a
Swingline Loan) shall be made as part of a Borrowing consisting of Loans made
by the Lenders ratably in accordance with their respective applicable
Commitments; provided, however, that the failure of any Lender to
make any Loan shall not in itself relieve any other Lender of its obligation to
lend hereunder (it being understood, however, that no Lender shall be
responsible for the failure of any other Lender to make any Loan required to be
made by such other Lender).  Except for
Loans deemed made pursuant to Section 3.05 and subject to Section 2.22(e)
in the case of B/A Loans, Loans comprising any Borrowing shall be (i) in
an aggregate principal amount that is not less than U.S.$1,000,000 (or the
Canadian Dollar Equivalent thereof) and an integral multiple of U.S.$1,000,000,
in the case of a Eurodollar Borrowing, or U.S.$500,000 (or the Canadian Dollar
Equivalent thereof) in the case of any other Type of Borrowing or (ii) in
the case of an ABR Borrowing, in an aggregate principal amount equal to the
remaining available balance of the applicable Commitments.

 

(b)  Subject
to Section 2.08, (i) each Borrowing denominated in U.S.
Dollars shall be comprised entirely of ABR Loans or Eurodollar Loans and
(ii) each Revolving (Canadian) Credit Borrowing denominated in Canadian
Dollars shall be comprised entirely of B/A Loans or Canadian Prime Rate Loans,
in each case as the applicable Borrower may request pursuant to Section 2.03
or as otherwise may be provided in this Agreement; provided, however,
that the Loans to be made on the Closing Date shall be made as ABR Loans or
Canadian Prime Rate Loans.  Each Lender
(other than any Deposit Funded Lender) may at its option fulfill its Commitment
with respect to any Eurodollar Loan or any Loan denominated in Canadian Dollars
by causing any domestic or foreign branch or Affiliate of such Lender to make
such Loan, and each Deposit Funded Lender may at its option, by notice to the
Administrative Agent, designate any domestic or foreign branch or Affiliate of
such Lender as the holder of any Eurodollar Deposit Funded Loan; provided,
however, that any exercise of any such option shall not (A) affect
the obligation of the applicable Borrower to repay such Loan in accordance with
the terms of this Agreement or (B) require any reimbursement or other
payment to be made to such Lender or its Affiliates pursuant to Section 2.19
in an amount in excess of the amounts that would have been payable thereunder
to such Lender had such Lender not exercised such option.  Borrowings of more than one Type may be
outstanding at the same time; provided, however, that the
Borrowers shall not be entitled to request any Borrowing that, if made, would
result in an aggregate of more than fifteen separate Eurodollar Loans and five
B/A Borrowings of any Lender being outstanding hereunder at any one time.  For purposes of the foregoing, Loans having
different Interest Periods or Contract Periods or denominated in different
currencies, regardless of whether they commence on the same date, shall be
considered separate Loans.

 

46

 

(c)  Except
with respect to Deposit Funded Loans (which shall be made as provided in Section
3.05) and Swingline Loans (which shall be made as provided in Section
2.21), each Lender shall make a Loan in the amount of its pro rata portion,
as determined under Section 2.16, of each Borrowing hereunder on
the proposed date thereof by wire transfer of immediately available funds not
later than 2:00 p.m., Standard Time, to the account of the Administrative Agent
(or, in the case of any Loan made to SSC Canada, to the account of the Canadian
Administrative Agent) most recently designated by such agent for such purpose,
and the Administrative Agent shall promptly credit the amounts so received to
the general deposit account of the applicable Borrower or, if a Borrowing shall
not occur on such date because any condition precedent specified herein shall
not have been met, return the amounts so received to the respective
Lenders.  Unless the Administrative Agent
shall have received notice from a Lender prior to the date of any Borrowing
(or, in the case of an ABR Borrowing or a Canadian Prime Rate Borrowing, prior to
2:00 p.m., Standard Time, on the date of such Borrowing) that such Lender
will not make available to the Administrative Agent such Lender’s portion of
such Borrowing, the Administrative Agent may assume that such Lender has made
such portion available to the Administrative Agent on the date of such
Borrowing in accordance with this paragraph (c), and the
Administrative Agent may, in reliance upon such assumption, make available to
the applicable Borrower on such date a corresponding amount.  If and to the extent that such Lender shall
not have made such portion available to the Administrative Agent, such Lender
and such Borrower severally agree to repay to the Administrative Agent
forthwith on demand such corresponding amount, together with interest thereon
for each day from the date such amount is made available to the applicable
Borrower until the date such amount is repaid to the Administrative Agent at
(i) in the case of such Borrower, the interest rate applicable at the time
to the Loans comprising such Borrowing and (ii) in the case of such
Lender, the Federal Funds Effective Rate or, in the case of a Revolving
(Canadian) Credit Borrowing denominated in Canadian Dollars, the rate
determined by the Canadian Administrative Agent to represent its cost of
obtaining overnight Canadian Dollars.  If
such Lender shall repay to the Administrative Agent such corresponding amount,
such amount shall be deemed to constitute such Lender’s Loan as part of such
Borrowing for purposes of this Agreement.

 

(d)  Notwithstanding
any other provision of this Agreement, the Borrowers shall not be entitled to
request any Interest Period (or Contract Period in the case of a B/A Borrowing)
with respect to any Borrowing that would end after the Revolving Credit
Maturity Date, the Term Loan Maturity Date, the Incremental Term Loan Maturity
Date or the Deposit Funded Maturity Date, as applicable.

 

SECTION 2.03.  Notice of Borrowings.  To request a Borrowing (other than a
Swingline Loan or a Borrowing deemed made pursuant to Section 3.05, as
to which this Section 2.03 shall not apply), the applicable Borrower
shall give the Administrative Agent written or fax notice substantially in the
form of Exhibit K (or telephone notice promptly confirmed in
writing or by fax) (a) in the case of a Eurodollar Borrowing, not later
than 11:00 a.m., Standard Time, three Business Days before a proposed
borrowing, (b) in the case of an ABR Term Borrowing or a B/A Borrowing,
not later than 11:00 a.m., Standard Time, one Business Day before a
proposed borrowing and

 

47

 

(c) in the case of an ABR
Revolving Credit Borrowing, ABR Revolving (Canadian) Credit Borrowing or
Canadian Prime Rate Borrowing, not later than 11:00 a.m., Standard Time,
on the day of a proposed borrowing.  Such
notice shall be irrevocable and shall in each case refer to this Agreement and
specify the following information:

 

(i) the
Borrower requesting such Borrowing;

 

(ii) the Type
(e.g., Eurodollar, ABR, B/A or Canadian Prime Rate) of such Borrowing;

 

(iii) whether
the Borrowing is to be a Revolving Credit Borrowing, Revolving (Canadian)
Credit Borrowing, Tranche B Borrowing, Tranche C Borrowing or
Incremental Term Loan Borrowing;

 

(iv) the
aggregate amount and currency of such Borrowing;

 

(v) the date
of such Borrowing (which shall be a Business Day);

 

(vi) in the
case of a Eurodollar Borrowing, the Interest Period with respect thereto;

 

(vii) in the
case of a B/A Borrowing, the Contract Period and maturity date with respect
thereto; and

 

(viii) the
number and location of the account to which funds are to be disbursed;

 

provided, however,
that, notwithstanding any contrary specification in any such notice, each
requested Borrowing shall comply with the requirements set forth in Section 2.02.  If no election as to the Type of Borrowing is
specified in any such notice, then the requested Borrowing shall be an ABR
Borrowing if denominated in U.S. Dollars and a Canadian Prime Rate Borrowing if
denominated in Canadian Dollars.  If no
Interest Period with respect to any Eurodollar Borrowing (or Contract Period
with respect to a B/A Borrowing) is specified in any such notice, then the
Borrower shall be deemed to have selected an Interest Period (or Contract
Period, in the case of a B/A Borrowing) of one month’s duration.  The Administrative Agent shall promptly
advise the applicable Lenders of any notice given pursuant to this Section 2.03,
and of each such Lender’s portion of the requested Borrowing.

 

SECTION 2.04.  Repayment of Loans; Evidence of Debt.  (a)  SSCE
hereby unconditionally promises to pay (i) to the Administrative Agent,
for the account of each Revolving Lender, the then unpaid principal amount of
each Revolving Loan of such Lender on the Revolving Credit Maturity Date,
(ii) to the Administrative Agent, for the account of (x) each
Tranche B Lender and (y) each Incremental Term Lender that shall have
made Other Term Loans to SSCE, the then unpaid principal amount of each
Tranche B Loan and each such Other Term Loan of such Lender in such amounts
and on such dates as provided in Section 2.11, (iii) to the
Administrative Agent, for the account of each Revolving (Canadian) Lender that
shall have made Revolving (Canadian) Loans

 

48

 

to SSCE, the then unpaid
principal amount of each such Revolving (Canadian) Loan of such Lender on the
Revolving Credit Maturity Date, (iv) to the Administrative Agent, for the
account of each Deposit Funded Lender, the then unpaid principal amount of each
Deposit Funded Loan of such Lender on the Deposit Funded Maturity Date and
(v) to the Swingline Lender the then unpaid principal amount of each
Swingline Loan on the Revolving Credit Maturity Date.  SSC Canada hereby unconditionally promises to
pay (i) to the Canadian Administrative Agent, for the account of each
Revolving (Canadian) Lender that shall have made Revolving (Canadian) Loans to
SSC Canada, the then unpaid principal amount of each such Revolving (Canadian)
Loan of such Lender on the Revolving Credit Maturity Date and (ii) to the
Administrative Agent, for the account of (x) each Tranche C Lender
and (y) each Incremental Term Lender that shall have made Other Term Loans
to SSC Canada, the then unpaid principal amount of each Tranche C Loan and
each such Other Term Loan of such Lender in such amounts and on such dates as
provided in Section 2.11. 
Except for any B/A Loan (the compensation for which is set forth in Section 2.22),
each Loan shall bear interest from and including the date made on the
outstanding principal balance thereof as set forth in Section 2.06.

 

(b)  Each
Lender shall maintain in accordance with its usual practice an account or
accounts evidencing the Indebtedness to such Lender resulting from each Loan
made by such Lender from time to time, including the amounts of principal and
interest payable and paid to such Lender from time to time under this
Agreement.

 

(c)  The
Administrative Agent shall maintain accounts in which it will record
(i) the amount of each Loan made hereunder, the Type of each Loan and the
Interest Period or Contract Period, if any, applicable thereto, (ii) the
amount of any principal or interest due and payable or to become due and
payable from each Borrower to each Lender hereunder, (iii) the amount of
the interest of each Deposit Funded Lender in the Deposit Account (the interest
of each such Lender in the Deposit Account, as evidenced by such records, being
referred to as such Lender’s “Sub-Account”) and (iv) the amount of
any sum received by the Administrative Agent hereunder from any Borrower or any
Guarantor, or from the Deposit Account Agent, and each Lender’s share
thereof.  The Administrative Agent shall
promptly provide to the Deposit Account Agent such information regarding the
Deposit Funded Lenders, the Deposit Funded Loans and the Deposit Funded Letters
of Credit, including the identity of the Deposit Funded Lenders, the amount
credited to each such Lender’s Sub-Account and the outstanding amount of each
such Lender’s Deposit Funded Loan, as the Deposit Account Agent may from time
to time request.  The Deposit Account
Agent shall provide to the Administrative Agent prompt notice of any withdrawal
from (or, in the case of any deposit of amounts received other than from the
Administrative Agent, any deposit into) the Deposit Account, in each case
stating the amount thereof, and the Administrative Agent shall credit or debit,
as applicable, the Sub-Account of each Deposit Funded Lender in the amount of
such Lender’s Applicable Percentage of the amount so withdrawn or deposited.  The Deposit Account Agent shall also provide
to the Administrative Agent such other information with respect to the Deposit
Account as the Administrative Agent may from time to time request.

 

49

 

(d)  The
entries made in the accounts maintained by the Lenders and the Administrative
Agent pursuant to paragraphs (b) and (c) above shall, to the
extent permitted by applicable laws, be prima facie evidence of the existence
and amounts of the obligations therein recorded; provided, however,
that the failure of any Lender or the Administrative Agent to maintain such
accounts or any error therein shall not in any manner affect the obligation of
either Borrower to repay the Loans in accordance with their terms.

 

(e)  Any
Lender may request that Loans made by it hereunder be evidenced by a promissory
note.  In response to any such request,
the applicable Borrower shall prepare, execute and deliver to such Lender a
promissory note payable to such Lender and its registered assigns substantially
in the form of Exhibit L, with the blanks appropriately filled in.  Notwithstanding any other provision of this
Agreement, in the event that any Lender shall request and receive such a
promissory note, the Loans evidenced by such promissory note and interest
payable on such Loans shall at all times (including after assignment pursuant
to Section 11.04) be represented by one or more promissory notes,
if any, payable to the order of the payee named therein (or, if such promissory
note is a registered note, to such payee and its registered assigns).

 

SECTION 2.05.  Fees; Deposit Return.  (a)  SSCE
agrees to pay to each Revolving Lender, in respect of the Revolving Credit
Commitment of such Lender, through the Administrative Agent, on each April 1,
July 1, October 1 and January 2 and on each date on which the Revolving Credit
Commitment of such Lender shall expire or be terminated as provided herein, a
commitment fee (a “SSCE Commitment Fee”) equal to the Applicable Rate
per annum in effect from time to time on the daily unused amount of the
Revolving Credit Commitment of such Lender during the preceding quarter (or
shorter period commencing with the Closing Date or ending with the Revolving
Credit Maturity Date or the date on which such Commitment of such Lender shall
be terminated).  The Borrowers agree to
pay to each Revolving (Canadian) Lender, in respect of the Revolving (Canadian)
Credit Commitment of such Lender, through the Canadian Administrative Agent, on
each April 1, July 1, October 1 and January 2 and on each date on which the
Revolving (Canadian) Credit Commitment of such Lender shall expire or be
terminated as provided herein, a commitment fee (a “Canadian Commitment Fee”
and, together with the SSCE Commitment Fee, the “Commitment Fees”) equal
to the Applicable Rate per annum in effect from time to time on the daily
unused amount of the Revolving (Canadian) Credit Commitment of such Lender
during the preceding quarter (or shorter period commencing with the Closing
Date or ending with the Revolving Credit Maturity Date or the date on which
such Commitment of such Lender shall be terminated).  The SSCE Commitment Fees and the Canadian
Commitment Fees shall commence to accrue on and including the Closing Date and,
with respect to any Lender, shall cease to accrue on, but excluding, the date
on which the Revolving Credit Commitment or the Revolving (Canadian) Facility
Commitment, as the case may be, of such Lender shall expire or be terminated as
provided herein.  For purposes of
calculating the SSCE Commitment Fees only, any portion of the Revolving Credit
Commitments unavailable due to outstanding Swingline Loans shall be deemed to
be unused amounts of the Revolving Credit Commitments.

 

50

 

(b)  SSCE
agrees to pay (i) to each Revolving Lender, through the Administrative
Agent, on each April 1, July 1, October 1 and January 2 and on each date on
which the Revolving Credit Commitment of such Lender shall expire or be
terminated as provided herein, a participation fee (a “Revolving Facility LC
Participation Fee”) calculated on such Lender’s Applicable Percentage of
the daily aggregate Revolving Facility LC Exposure (excluding the portion
thereof attributable to unreimbursed LC Disbursements in respect of Revolving
Facility Letters of Credit) during the preceding quarter (or shorter period
commencing with the Closing Date or ending with the Revolving Credit Maturity
Date or the date on which all Revolving Facility Letters of Credit have been
canceled or have expired and the Revolving Credit Commitments of all Lenders
shall have been terminated) at a rate equal to the Applicable Rate per annum in
effect from time to time with respect to Eurodollar Revolving Loans,
(ii) to each Revolving Facility Facing Agent on each April 1, July 1,
October 1 and January 2 and on the date on which all of the Revolving Facility
Letters of Credit issued by such Facing Agent shall have been terminated or
expired, a fronting fee with respect to each Revolving Facility Letter of
Credit issued by it as separately agreed to between SSCE and such Facing Agent
and (iii) to each Revolving Facility Facing Agent, with respect to the
issuance, amendment or transfer of any Revolving Facility Letter of Credit
issued by such Facing Agent and each drawing made thereunder, customary
documentary and processing charges in accordance with such Facing Agent’s
standard schedule for such charges in effect at the time of such issuance,
amendment, transfer or drawing, as the case may be.

 

(c)  SSCE agrees to pay to each Deposit Funded
Lender, through the Administrative Agent, on each April 1, July 1, October 1
and January 2 and on each date on which the Deposit Funded Commitment of such
Lender shall expire or be terminated as provided herein, a fee (the “Deposit
Funded Commitment Fee”) equal to the sum of (i) the Applicable Rate per
annum in effect from time to time with respect to Eurodollar Tranche B Loans plus
(ii) 0.10% per annum, in each case, on the daily amount of the Deposit of such
Lender during the preceding quarter (or shorter period commencing with the
Closing Date or ending with the Deposit Funded Maturity Date or the date on
which the Deposit Funded Commitment of such Lender shall be terminated).  The Deposit Funded Commitment Fee due to each
Deposit Funded Lender shall commence to accrue on and including the Closing
Date and shall cease to accrue on, but excluding, the date on which such
Commitment of such Lender shall expire or be terminated as provided herein.  SSCE agrees to pay to the Deposit Funded
Facility Facing Agent on each April 1, July 1, October 1 and January 2 and on
the date on which all of the Deposit Funded Facility Letters of Credit issued
by such Facing Agent shall have been terminated or expired, a fronting fee with
respect to each Deposit Funded Facility Letter of Credit issued by it as
separately agreed to between SSCE and such Facing Agent, as well as documentary
and processing charges with respect to the issuance, amendment or transfer of
any Deposit Funded Facility Letter of Credit and each drawing made thereunder
in accordance with such Facing Agent’s standard schedule for such charges in
effect at the time of such issuance, amendment, transfer or drawing, as the
case may be.

 

(d)  SSC
Canada agrees to pay (i) to each Revolving (Canadian) Lender, through the
Canadian Administrative Agent, on each April 1, July 1, October 1 and

 

51

 

January 2 and on each date on
which the Revolving (Canadian) Credit Commitment of such Lender shall expire or
be terminated as provided herein, a participation fee (a “Revolving
(Canadian) Facility LC Participation Fee”) calculated on such Lender’s
Applicable Percentage of the daily aggregate Revolving (Canadian) Facility LC
Exposure (excluding the portion thereof attributable to unreimbursed LC
Disbursements in respect of Revolving (Canadian) Facility Letters of Credit)
during the preceding quarter (or shorter period commencing with the Closing
Date or ending with the Revolving Credit Maturity Date or the date on which all
Revolving (Canadian) Facility Letters of Credit have been canceled or have
expired and the Revolving (Canadian) Credit Commitments of all Lenders shall
have been terminated) at a rate equal to the Applicable Rate per annum in
effect from time to time with respect to Eurodollar Revolving (Canadian) Loans,
(ii) to each Revolving (Canadian) Facility Facing Agent on each April 1,
July 1, October 1 and January 2 and on the date on which all of the Revolving
(Canadian) Facility Letters of Credit issued by such Facing Agent shall have
been terminated or expired, a fronting fee with respect to each Revolving
(Canadian) Facility Letter of Credit issued by it as separately agreed to
between SSC Canada and such Facing Agent and (iii) to each Revolving
(Canadian) Facility Facing Agent, with respect to the issuance, amendment or
transfer of any Revolving (Canadian) Facility Letter of Credit issued by such
Facing Agent and each drawing made thereunder, customary documentary and processing
charges in accordance with such Facing Agent’s standard schedule for such
charges in effect at the time of such issuance, amendment, transfer or drawing,
as the case may be.

 

(e)  The
Borrowers agree to pay to the Administrative Agent, for its own account, the
administration fees at the times and in the amounts agreed upon by the
Borrowers and the Administrative Agent.

 

(f)  All
Fees shall be paid on the dates due, in U.S. Dollars in immediately available
funds, to the Administrative Agent or the Canadian Administrative Agent, as
applicable, for distribution as appropriate among the Lenders, except that Fees
payable to any Facing Agent or to the Administrative Agent shall be paid
directly to such Person.  Once paid, none
of the Fees shall be refundable under any circumstances (other than corrections
of errors in payment).  The Commitment
Fees, the Revolving Facility LC Participation Fees and the Revolving (Canadian)
Facility LC Participation Fees shall be computed on the basis of the actual
number of days elapsed in a year of 360 days.

 

(g)  The Deposit Account Agent shall invest, or cause to be
invested, amounts on deposit in the Deposit Account so as to earn a return
thereon (the “Deposit Return”)
for each day at a rate per annum equal to (i) the one month LIBO rate (as such
rate is determined by the Deposit Account Agent on such day (or if such day was
not a Business Day, on the first preceding Business Day) based on rates for
deposits in U.S. Dollars (as set forth by Bloomberg L.P.-page BTMM or any other
comparable publicly available service as may be selected by the Deposit Account
Agent) (the “Benchmark LIBO Rate”)
minus (ii) 0.10% per annum (based on a 365/366 day year).  The Benchmark LIBO Rate will be reset on each
Business Day.  The Deposit Return
accrued through and including each March 31, June 30, September 30 and December
31 shall be paid by the Deposit Account Agent to the Administrative Agent, for
distribution among

 

52

 

the Deposit Funded Lenders, on
the third Business Day following such day, commencing on the first such date to
occur after the Closing Date, and on the date on which all of the Deposit
Funded Commitments shall have been terminated or expired and the Deposit Funded
LC Exposure shall have been reduced to zero. 
No Loan Party shall have any obligation under or in respect of the
provisions of this paragraph (g).

 

SECTION 2.06.  Interest on Loans.  (a)  Subject
to the provisions of Section 2.07, the Loans comprising each ABR
Borrowing shall bear interest (computed on the basis of the actual number of
days elapsed over a year of 365 or 366 days, as the case may be, when the
Alternate Base Rate is determined by reference to the Prime Rate or the U.S.
Base Rate and over a year of 360 days at all other times) at a rate per
annum equal to the Alternate Base Rate plus the Applicable Rate in
effect at such time with respect to such Loans. 
Swingline Loans shall bear interest at the rate applicable to ABR
Revolving Loans.

 

(b)  Subject
to the provisions of Section 2.07, the Loans comprising each
Eurodollar Borrowing shall bear interest (computed on the basis of the actual
number of days elapsed over a year of 360 days) at a rate per annum equal
to the Adjusted LIBO Rate for the Interest Period in effect for such Borrowing plus
the Applicable Rate in effect at such time with respect to such Loans.

 

(c)  Subject
to the provisions of Section 2.07, the Loans comprising each
Canadian Prime Rate Borrowing shall bear interest (computed on the basis of the
actual number of days elapsed over a year of 365 or 366 days, as the case
may be) at a rate per annum equal to the Canadian Prime Rate plus the
Applicable Rate in effect at such time with respect to such Loans.

 

(d)  Subject
to the provisions of Section 2.07, the Loans comprising each B/A
Borrowing shall be subject to an Acceptance Fee, payable by SSC Canada on the
date of acceptance of the relevant B/A and calculated as set forth in the
definition of the term “Acceptance Fee” in Section 1.01.

 

(e)  Each
Deposit Funded Borrowing shall, initially, be comprised of ABR Loans bearing
interest at a rate applicable to ABR Tranche B Loans and, thereafter, may be
comprised of either ABR Loans or Eurodollar Loans, as SSCE may elect in
accordance with Section 2.10, bearing interest at a rate applicable
to ABR Tranche B Loans or Eurodollar Tranche B Loans, as applicable.

 

(f)  Interest
on each Loan (other than pursuant to a B/A Borrowing) shall be payable on the
Interest Payment Dates applicable to such Loan and at such other times as are
specified in this Agreement.  The
Applicable Rate for each Interest Period or day within an Interest Period, as
the case may be, shall be determined by the Administrative Agent or the Canadian
Administrative Agent, as applicable, and such determination shall be
presumptively correct absent manifest error.

 

(g)  For
the purposes of the Interest Act (Canada) and disclosure thereunder, whenever
any interest or fee to be paid hereunder or in connection herewith is

 

53

 

to be calculated on the basis
of any period of time that is less than a calendar year, the yearly rate of
interest to which the rate used in such calculation is equivalent is the rate
so used multiplied by the actual number of days in the calendar year in which
the same is to be ascertained and divided by 360, 365 or 366, as
applicable.  The rates of interest under
this Agreement are nominal rates, and not effective rates or yields.  The principle of deemed reinvestment of interest
does not apply to any interest calculation under this Agreement.

 

SECTION 2.07.  Default Interest.  If either Borrower shall default in the
payment of the principal of or interest on any Loan or any other amount
becoming due hereunder or under any Loan Document, by acceleration or
otherwise, the applicable Borrower shall on demand from time to time pay
interest, to the extent permitted by law, on such defaulted amount to but
excluding the date of actual payment (after as well as before judgment or bankruptcy)
at a rate per annum (the “Default Rate”) equal to (a) in the case
of any Loan, the rate that would be applicable under Section 2.06
to such Loan plus 2.00% per annum and (b) in the case of any other
amount, the rate that would be applicable under Section 2.06 to an
ABR Term Loan plus 2.00% per annum.

 

SECTION 2.08.  Alternate Rate of Interest.  In the event, and on each occasion, that on
the day two Business Days prior to the commencement of any Interest Period for
a Eurodollar Borrowing the Administrative Agent shall have determined that U.S.
Dollar deposits in the principal amounts of the Loans comprising such Borrowing
are not generally available in the London interbank market, or that the rates
at which such U.S. Dollar deposits are being offered will not adequately and
fairly reflect the cost to a majority in interest of Lenders under the relevant
Credit Facility of making or maintaining their Eurodollar Loans during such
Interest Period, or that reasonable means do not exist for ascertaining the
Adjusted LIBO Rate, the Administrative Agent shall, as soon as practicable
thereafter, give written or fax notice of such determination to each Borrower
and the Lenders.  In the event of any
such determination, any request by either Borrower for such a Eurodollar
Borrowing pursuant to Section 2.03 or 2.10 shall, until the
Administrative Agent shall have advised the Borrowers and the Lenders that the
circumstances giving rise to such notice no longer exist, be deemed to be a
request for an ABR Borrowing.  Each
determination by the Administrative Agent hereunder shall be conclusive absent
manifest error.

 

SECTION 2.09.  Termination and Reduction of Commitments;
Return of Deposits.  (a)  The Term Loan Commitments (other than any
Incremental Term Loan Commitments, which shall terminate in accordance with the
applicable Incremental Term Loan Assumption Agreement) shall terminate at
5:00 p.m., Standard Time, on the Closing Date.  The Revolving Credit Commitments and the
Revolving (Canadian) Credit Commitments shall terminate at 5:00 p.m.,
Standard Time, on the Revolving Credit Maturity Date.  The Deposit Funded Commitments shall
terminate at 5:00 p.m., Standard Time, on the Deposit Funded Maturity
Date.

 

(b)  Upon
at least three Business Days’ prior irrevocable written or fax notice to the
Administrative Agent (and, in the case of termination or reduction of the
Deposit Funded Commitments, the Deposit Account Agent), (i) SSCE may at
any time in

 

54

 

whole permanently terminate, or
from time to time in part permanently reduce, the Tranche B Commitments,
the Revolving Credit Commitments and/or the Deposit Funded Commitments and
(ii) SSC Canada may at any time in whole permanently terminate, or from
time to time in part permanently reduce, the Tranche C Commitments and/or
the Revolving (Canadian) Credit Commitments; provided, however,
that (A) each partial reduction of such Commitments shall be in an
integral multiple of U.S.$1,000,000 and in a minimum principal amount of
U.S.$5,000,000, (B) SSCE shall not be permitted to terminate or reduce the
Revolving Credit Commitments if, as the result of such termination or
reduction, the Revolving Credit Utilization would exceed the aggregate
remaining Revolving Credit Commitments, (C) SSCE shall not be permitted to
terminate or reduce the Deposit Funded Commitments if, as the result of such
termination or reduction, the Deposit Funded Utilization would exceed the
aggregate remaining Deposit Funded Commitments and (D) SSC Canada shall
not be permitted to terminate or reduce the Revolving (Canadian) Credit
Commitments if, as the result of such termination or reduction, the Revolving
(Canadian) Credit Utilization would exceed the aggregate remaining Revolving
(Canadian) Credit Commitments.

 

(c)  The
applicable Borrower shall pay to the Administrative Agent for the account of
the applicable Lenders, on the date of each termination or reduction, the
Commitment Fees and the Deposit Funded Commitment Fees on the amount of the
Commitments so terminated or reduced accrued to, but excluding, the date of
such termination or reduction.

 

(d)  Concurrently
with the effectiveness of each voluntary reduction of the Deposit Funded
Commitments pursuant to and in accordance with paragraph (b) above, (i)
the Administrative Agent shall give notice to the Deposit Account Agent of the
aggregate amount of the Deposit Funded Commitments remaining after giving
effect to such reduction and the aggregate principal amount of the Deposit
Funded Loans outstanding at such time and (b) the Deposit Account Agent shall
withdraw from the Deposit Account and transfer to the Administrative Agent (and
the Administrative Agent shall pay to each Deposit Funded Lender such Lender’s
Applicable Percentage of) any amount by which the aggregate funds on deposit in
the Deposit Account exceed at such time the difference between (A) the
aggregate amount of such Deposit Funded Commitments minus (B) the
aggregate principal amount of such Deposit Funded Loans.

 

(e)  Concurrently
with the effectiveness of the termination in whole of the aggregate Deposit
Funded Commitments pursuant to and in accordance with paragraph (a)
or (b) above or Article VIII, (i) the Administrative Agent
shall give notice to the Deposit Account Agent of the amount of the
Undrawn/Unreimbursed Deposit Funded LC Exposure at such time and (ii) the
Deposit Account Agent shall withdraw from the Deposit Account and transfer to
the Administrative Agent (and the Administrative Agent shall pay to each
Deposit Funded Lender such Lender’s Applicable Percentage (determined
immediately prior to giving effect to the CAM Exchange, if applicable) of) any
amount by which the aggregate funds on deposit in the Deposit Account exceed at
such time the Undrawn/Unreimbursed Deposit Funded LC Exposure.  Thereafter, the Administrative Agent shall
give notice to the Deposit Account Agent of the reduction of the
Undrawn/Unreimbursed Deposit Funded LC Exposure to zero, and,

 

55

 

upon receipt of such notice,
the Deposit Account Agent shall withdraw from the Deposit Account and transfer
to the Administrative Agent (and the Administrative Agent shall pay to each
Deposit Funded Lender such Lender’s Applicable Percentage (determined as
aforesaid) of) all the funds remaining on deposit in the Deposit Account, and
shall close the Deposit Account.

 

(f)  Nothing
in this Section 2.09 shall prejudice any rights that either
Borrower may have against any Lender that fails to lend as required hereunder
prior to the date of termination of any Commitment.

 

SECTION 2.10.  Conversion and Continuation of Borrowings.  Each Borrower shall have the right at any
time upon prior irrevocable notice substantially in the form of Exhibit M
to the Administrative Agent (a) not later than 11:00 a.m., Standard
Time, on the day of the proposed conversion, to convert any Eurodollar
Borrowing into an ABR Borrowing or to convert any B/A Borrowing into a Canadian
Prime Rate Borrowing, (b) not later than 11:00 a.m., Standard Time,
three Business Days prior to conversion or continuation, to convert any ABR
Borrowing into a Eurodollar Borrowing or to continue any Eurodollar Borrowing
as a Eurodollar Borrowing for an additional Interest Period, (c) not later
than 11:00 a.m., Standard Time, three Business Days prior to conversion,
to convert the Interest Period with respect to any Eurodollar Borrowing to
another permissible Interest Period and (d) not later than
11:00 a.m., Standard Time, one Business Day prior to conversion or continuation,
to convert any Canadian Prime Rate Borrowing to a B/A Borrowing or to continue
any B/A Borrowing as a B/A Borrowing for an additional Contract Period, subject
in each case to the following:

 

(i) each
conversion or continuation shall be made pro rata among the Lenders in
accordance with the respective principal amounts of the Loans comprising the
converted or continued Borrowing;

 

(ii) if less
than all the outstanding principal amount of any Borrowing shall be converted
or continued, the aggregate principal amount of such Borrowing converted or
continued shall be in an integral multiple of U.S.$1,000,000 or Cdn.$1,000,000,
as the case may be, and not less than U.S.$10,000,000 or Cdn.$10,000,000;

 

(iii) each
conversion shall be effected by each Lender and the Administrative Agent by
recording the particulars thereof in their respective accounts maintained
pursuant to Section 2.04, and no new Loan shall be considered to have
been made as a result thereof; accrued interest on any Eurodollar Loan (or
portion thereof) being converted shall be paid by the applicable Borrower at
the time of the conversion;

 

(iv) if any
Eurodollar Borrowing is converted at a time other than the end of the Interest
Period applicable thereto, the applicable Borrower shall pay, upon demand, any
amounts due to the Lenders pursuant to Section 2.15;

 

56

 

(v) any
portion of a Borrowing maturing or required to be repaid in less than one month
may not be converted into or continued as a Eurodollar Borrowing or a B/A
Borrowing;

 

(vi) any
portion of a Eurodollar Borrowing or a B/A Borrowing that cannot be converted
into or continued as a Eurodollar Borrowing or a B/A Borrowing by reason of clause
(v) above shall be automatically converted at the end of the Interest
Period or Contract Period in effect for such Borrowing into an ABR Borrowing or
a Canadian Prime Rate Borrowing, as the case may be;

 

(vii) no
Interest Period may be selected for any Eurodollar Term Borrowing that would
end later than any applicable Term Loan Repayment Date occurring on or after
the first day of such Interest Period if, after giving effect to such
selection, the aggregate outstanding amount of (A) the Eurodollar Term
Borrowings with Interest Periods ending on or prior to such Term Loan Repayment
Date and (B) the ABR Term Borrowings would not be at least equal to the
principal amount of Term Borrowings to be paid on such Term Loan Repayment
Date;

 

(viii) no B/A
Borrowing may be converted or continued other than at the end of the Contract
Period applicable thereto; and

 

(ix) upon
notice to the Borrowers from the Administrative Agent given at the request of
the Required Lenders, after the occurrence and during the continuance of a
Default or Event of Default, no outstanding Loan may be converted into, or
continued as, a Eurodollar Loan or a B/A Loan.

 

Each notice pursuant to this Section 2.10
shall be irrevocable and shall refer to this Agreement and specify (A) the
identity, amount and Class of the Borrowing that the Borrower requests be
converted or continued, (B) whether such Borrowing is to be converted to
or continued as a Eurodollar Borrowing, an ABR Borrowing, a B/A Borrowing or a
Canadian Prime Rate Borrowing, (C) if such notice requests a conversion,
the date of such conversion (which shall be a Business Day) and (D) if
such Borrowing is to be converted to or continued as a Eurodollar Borrowing or
a B/A Borrowing, the Interest Period or Contract Period, respectively, with
respect thereto.  If no Interest Period
or Contract Period is specified in any such notice with respect to any
conversion to or continuation as a Eurodollar Borrowing or a B/A Borrowing,
respectively, the applicable Borrower shall be deemed to have selected an
Interest Period or Contract Period of one month’s duration.  The Administrative Agent shall advise the
applicable Lenders of any notice given pursuant to this Section 2.10
and of each Lender’s portion of any converted or continued Borrowing.  If the applicable Borrower shall not have
given notice in accordance with this Section 2.10 to continue any
Borrowing into a subsequent Interest Period or Contract Period (and shall not
otherwise have given notice in accordance with this Section 2.10 to
convert such Borrowing), such Borrowing shall, at the end of the Interest
Period applicable thereto (unless repaid pursuant to the terms

 

57

 

hereof), automatically be
continued into a new Interest Period as an ABR Borrowing or a Canadian Prime
Rate Borrowing, as applicable.

 

SECTION 2.11.  Repayment of Term Borrowings.  (a)  SSCE
shall pay to the Administrative Agent, for the account of the Tranche B
Lenders, on the dates set forth below, or if any such date is not a Business
Day, on the next succeeding Business Day (each such date being a “Tranche B
Repayment Date”), a principal amount of Tranche B Loans (such amount,
as adjusted from time to time pursuant to Sections 2.12, 2.13(f),
2.13(j) and 2.23(f), being called the “Tranche B Repayment
Amount”) equal to the amount set forth below for such date:

 

	
  Date

  	
   

  	
  Amount

  	
   

  
	
  April 1, 2005

  	
   

  	
  U.S.$

  	
  2,437,500

  	
   

  
	
  July 1, 2005

  	
   

  	
  U.S.$

  	
  2,437,500

  	
   

  
	
  October 1, 2005

  	
   

  	
  U.S.$

  	
  2,437,500

  	
   

  
	
  January 2, 2006

  	
   

  	
  U.S.$

  	
  2,437,500

  	
   

  
	
  April 1, 2006

  	
   

  	
  U.S.$

  	
  2,437,500

  	
   

  
	
  July 1, 2006

  	
   

  	
  U.S.$

  	
  2,437,500

  	
   

  
	
  October 1, 2006

  	
   

  	
  U.S.$

  	
  2,437,500

  	
   

  
	
  January 2, 2007

  	
   

  	
  U.S.$

  	
  2,437,500

  	
   

  
	
  April 1, 2007

  	
   

  	
  U.S.$

  	
  2,437,500

  	
   

  
	
  July 1, 2007

  	
   

  	
  U.S.$

  	
  2,437,500

  	
   

  
	
  October 1, 2007

  	
   

  	
  U.S.$

  	
  2,437,500

  	
   

  
	
  January 2, 2008

  	
   

  	
  U.S.$

  	
  2,437,500

  	
   

  
	
  April 1, 2008

  	
   

  	
  U.S.$

  	
  2,437,500

  	
   

  
	
  July 1, 2008

  	
   

  	
  U.S.$

  	
  2,437,500

  	
   

  
	
  October 1, 2008

  	
   

  	
  U.S.$

  	
  2,437,500

  	
   

  
	
  January 2, 2009

  	
   

  	
  U.S.$

  	
  2,437,500

  	
   

  
	
  April 1, 2009

  	
   

  	
  U.S.$

  	
  2,437,500

  	
   

  
	
  July 1, 2009

  	
   

  	
  U.S.$

  	
  2,437,500

  	
   

  
	
  October 1, 2009

  	
   

  	
  U.S.$

  	
  2,437,500

  	
   

  
	
  January 2, 2010

  	
   

  	
  U.S.$

  	
  2,437,500

  	
   

  
	
  April 1, 2010

  	
   

  	
  U.S.$

  	
  2,437,500

  	
   

  
	
  July 1, 2010

  	
   

  	
  U.S.$

  	
  2,437,500

  	
   

  
	
  October 1, 2010

  	
   

  	
  U.S.$

  	
  2,437,500

  	
   

  
	
  January 2, 2011

  	
   

  	
  U.S.$

  	
  2,437,500

  	
   

  
	
  April 1, 2011

  	
   

  	
  U.S.$

  	
  229,125,000

  	
   

  
	
  July 1, 2011

  	
   

  	
  U.S.$

  	
  229,125,000

  	
   

  
	
  October 1, 2011

  	
   

  	
  U.S.$

  	
  229,125,000

  	
   

  
	
  Term Loan Maturity Date

  	
   

  	
  U.S.$

  	
  229,125,000

  	
   

  

 

(b)  Subject
to Section 2.13(j), SSC Canada shall pay to the Administrative
Agent, for the account of the Tranche C Lenders, on the dates set forth
below, or if any such date is not a Business Day, on the next succeeding
Business Day (each such date being a “Tranche C Repayment Date”), a
principal amount of Tranche C Loans (such amount, as adjusted from time to
time pursuant to Sections 2.12, 2.13(f) and 2.23(f),

 

58

 

being called the “Tranche C
Repayment Amount”) equal to the amount set forth below for such date:

 

	
  Date

  	
   

  	
  Amount

  	
   

  
	
  April 1, 2005

  	
   

  	
  U.S.$

  	
  750,000

  	
   

  
	
  July 1, 2005

  	
   

  	
  U.S.$

  	
  750,000

  	
   

  
	
  October 1, 2005

  	
   

  	
  U.S.$

  	
  750,000

  	
   

  
	
  January 2, 2006

  	
   

  	
  U.S.$

  	
  750,000

  	
   

  
	
  April 1, 2006

  	
   

  	
  U.S.$

  	
  750,000

  	
   

  
	
  July 1, 2006

  	
   

  	
  U.S.$

  	
  750,000

  	
   

  
	
  October 1, 2006

  	
   

  	
  U.S.$

  	
  750,000

  	
   

  
	
  January 2, 2007

  	
   

  	
  U.S.$

  	
  750,000

  	
   

  
	
  April 1, 2007

  	
   

  	
  U.S.$

  	
  750,000

  	
   

  
	
  July 1, 2007

  	
   

  	
  U.S.$

  	
  750,000

  	
   

  
	
  October 1, 2007

  	
   

  	
  U.S.$

  	
  750,000

  	
   

  
	
  January 2, 2008

  	
   

  	
  U.S.$

  	
  750,000

  	
   

  
	
  April 1, 2008

  	
   

  	
  U.S.$

  	
  750,000

  	
   

  
	
  July 1, 2008

  	
   

  	
  U.S.$

  	
  750,000

  	
   

  
	
  October 1, 2008

  	
   

  	
  U.S.$

  	
  750,000

  	
   

  
	
  January 2, 2009

  	
   

  	
  U.S.$

  	
  750,000

  	
   

  
	
  April 1, 2009

  	
   

  	
  U.S.$

  	
  750,000

  	
   

  
	
  July 1, 2009

  	
   

  	
  U.S.$

  	
  750,000

  	
   

  
	
  October 1, 2009

  	
   

  	
  U.S.$

  	
  750,000

  	
   

  
	
  January 2, 2010

  	
   

  	
  U.S.$

  	
  750,000

  	
   

  
	
  April 1, 2010

  	
   

  	
  U.S.$

  	
  750,000

  	
   

  
	
  July 1, 2010

  	
   

  	
  U.S.$

  	
  750,000

  	
   

  
	
  October 1, 2010

  	
   

  	
  U.S.$

  	
  750,000

  	
   

  
	
  January 2, 2011

  	
   

  	
  U.S.$

  	
  750,000

  	
   

  
	
  April 1, 2011

  	
   

  	
  U.S.$

  	
  70,500,000

  	
   

  
	
  July 1, 2011

  	
   

  	
  U.S.$

  	
  70,500,000

  	
   

  
	
  October 1, 2011

  	
   

  	
  U.S.$

  	
  70,500,000

  	
   

  
	
  Term Loan Maturity Date

  	
   

  	
  U.S.$

  	
  70,500,000

  	
   

  

 

(c)  Subject
to Section 2.13(j) in the case of Other Term Loans made to SSC Canada,
the applicable Borrower shall pay to the Administrative Agent, for the account
of the applicable Incremental Term Lenders, on each Incremental Term Loan
Repayment Date, a principal amount of the Other Term Loans (such amount, as
adjusted from time to time pursuant to Sections 2.12, 2.13(f)
and 2.13(j), being called the “Incremental Term Loan Repayment Amount”)
equal to the amount set forth for such date in the applicable Incremental Term
Loan Assumption Agreement.

 

(d)  To
the extent not previously paid, all Term Loans and Other Term Loans shall be
due and payable on the Term Loan Maturity Date and Incremental Term Loan
Maturity Date, respectively.

 

(e)  All
repayments pursuant to this Section 2.11 shall be subject to Section 2.15
and shall be accompanied by accrued and unpaid interest on the principal

 

59

 

amount paid to but excluding
the date of payment, but shall otherwise be without premium or penalty.

 

SECTION 2.12.  Optional Prepayments.  (a)  Each
Borrower shall have the right at any time and from time to time to prepay any
Borrowing (other than Bankers’ Acceptances or B/A Equivalent Loans, which may,
however, be defeased as provided below), in whole or in part, upon written or
fax notice (or telephone notice promptly confirmed by written or fax notice)
delivered to the Administrative Agent (and, in the case of prepayment of a
Swingline Loan, the Swingline Lender) (i) by 11:00 a.m., Standard
Time, at least three Business Days prior to the date designated for such
prepayment, in the case of any prepayment of a Eurodollar Borrowing, or
(ii) by 11:00 a.m., Standard Time, on the date designated for such
prepayment in the case of any prepayment of an ABR Borrowing or a Canadian
Prime Rate Borrowing; provided,  however,
that each partial payment shall be in an amount that is an integral multiple of
U.S.$1,000,000 (or Cdn.$1,000,000 in the case of Borrowings denominated in
Canadian Dollars) and, in the case of a Eurodollar Borrowing, not less than
U.S.$5,000,000 (or, in each case, the entire amount of the Borrowing being
prepaid); and provided  further that SSC Canada may defease any
B/A or B/A Equivalent Loan by depositing with the Canadian Administrative Agent
an amount that, together with interest accruing on such amount to the end of
the Contract Period for such B/A or B/A Equivalent Loan at such rate as the
Canadian Administrative Agent shall specify upon receipt of such amount, is sufficient
to pay such maturing B/A or B/A Equivalent Loan when due.

 

(b)  Optional
prepayments of Term Loans made by the Borrowers pursuant to paragraph (a) above
shall be allocated among the Term Loans (and to the remaining scheduled
installments of principal with respect to any such Term Loans) in a manner
determined at the discretion of the Borrowers.

 

(c)  Each
notice of optional prepayment shall specify (i) the amount to be prepaid,
(ii) the prepayment date, (iii) the Class of Loans to be prepaid and
(iv) the allocation of the amount specified pursuant to clause (i) among
the Loans specified pursuant to clause (iii).  Each notice of optional prepayment shall be
irrevocable and shall commit the applicable Borrower to prepay such obligations
by the amount specified therein on the date specified therein.  All prepayments pursuant to this Section 2.12
shall be subject to Section 2.15 and shall be accompanied by
accrued and unpaid interest on the principal amount paid to but excluding the
date of payment, but shall otherwise be without premium or penalty.

 

(d)  No
optional prepayment of Term Loans made by either Borrower pursuant to this Section 2.12
shall reduce the applicable Borrower’s obligation to make mandatory prepayments
pursuant to Section 2.13(b), (c) or (d).

 

SECTION 2.13.  Mandatory Prepayments.  (a)  On
the date of any termination or reduction of the Revolving Credit Commitments
pursuant to Section 2.09, SSCE shall pay or prepay so much of the
then outstanding Swingline Loans and the then outstanding Revolving Credit
Borrowings (and/or cash collateralize outstanding Revolving Facility Letters of
Credit) as shall be necessary in order that the aggregate

 

60

 

Revolving Credit Utilization at
such time shall not exceed the aggregate Revolving Credit Commitments (after
giving effect to such termination or reduction).  On the date of any termination or reduction
of the Revolving (Canadian) Credit Commitments pursuant to Section 2.09,
the Borrowers shall pay or prepay so much of the then outstanding Revolving
(Canadian) Credit Borrowings (and/or SSC Canada shall cash collateralize
outstanding Revolving (Canadian) Facility Letters of Credit and defease B/As
and B/A Equivalent Loans) as shall be necessary in order that the aggregate
Revolving (Canadian) Credit Utilization at such time shall not exceed the
aggregate Revolving (Canadian) Credit Commitments (after giving effect to such
termination or reduction).  On the date
of any termination or reduction of the Deposit Funded Commitments pursuant to Section 2.09,
SSCE shall pay or prepay so much of the then outstanding Deposit Funded Loans
(and/or cash collateralize outstanding Deposit Funded Facility Letters of
Credit) as shall be necessary in order that the Deposit Funded Utilization at
such time shall not exceed the aggregate Deposit Funded Commitments (after
giving effect to such termination and reduction).

 

(b)  Subject
to Section 2.13(j), no later than the third Business Day following the
determination of the amount of Net Cash Proceeds received in respect of any
Asset Sale occurring on or after the Closing Date, the Borrowers shall apply an
amount equal to 100% of such Net Cash Proceeds to prepay outstanding Term Loans
in accordance with Section 2.13(f); provided, however,
that if (i) at any time prior to the due date of such prepayment, SSCE delivers
a certificate of its Financial Officer to the Administrative Agent setting
forth its intent (A) in the case of the Pontiac Sale, to use the Net Cash
Proceeds received in respect thereof (x) to redeem, repurchase or otherwise
extinguish, or to cause the Subsidiaries to redeem, repurchase or otherwise
extinguish, their outstanding Indebtedness in accordance with Section 7.09(a),
(y) to reinvest, or to cause the Subsidiaries to reinvest, such Net Cash
Proceeds in assets that are used or useful in the business of SSCC and the
Subsidiaries or (z) to use, or to cause its Subsidiaries to use, such Net
Cash Proceeds for acquisitions or purchases permitted by Section 7.05,
or (B) in the case of any other Asset Sale, to reinvest, or to cause the
Subsidiaries to reinvest, the Net Cash Proceeds received in respect thereof,
not in excess of U.S.$250,000,000 in the aggregate for all Asset Sales, within
360 days after the receipt thereof, in assets that are used or useful in the
business of SSCC and the Subsidiaries and (ii) no Default or Event of Default
shall have occurred and be continuing at the time such certificate is
delivered, then no prepayment of Term Loans shall be required pursuant to this paragraph
(b), except to the extent such Net Cash Proceeds are not so applied.

 

(c)  Subject
to Section 2.13(j), no later than the earlier of (i) 90 days
after the end of each fiscal year of SSCC, commencing with the fiscal year
ending on December 31, 2005, and (ii) the date on which the financial
statements with respect to such period are delivered pursuant to Section 6.04(a),
the Borrowers shall prepay outstanding Term Loans in accordance with Section 2.13(f)
in an aggregate principal amount equal to 50% of the amount of Excess Cash Flow
that is in excess of U.S.$100,000,000 for the fiscal year then ended.

 

(d)  Subject
to Section 2.13(j), in the event that SSCC or any Subsidiary shall
receive Net Cash Proceeds from the issuance or other disposition of
Indebtedness

 

61

 

for money borrowed of SSCC or
such Subsidiary (other than Indebtedness for money borrowed permitted pursuant
to Section 7.01 (other than clause (s) thereof), the
Borrowers shall reasonably promptly therewith (and in any event not later than
the third Business Day next following) the receipt of such Net Cash Proceeds by
SSCC or any Subsidiary, apply an amount equal to 100% of such Net Cash Proceeds
to prepay outstanding Term Loans in accordance with Section 2.13(f).

 

(e)  If
on any date, as a result of fluctuations in the Exchange Rate, the
Administrative Agent determines that the aggregate Revolving (Canadian) Credit
Utilization shall have exceeded for more than three consecutive Business Days
an amount equal to 105% of the total Revolving (Canadian) Credit Commitments,
the Administrative Agent shall notify the Borrowers of such occurrence and the
Borrowers shall on the next succeeding Business Day prepay Revolving (Canadian)
Loans in an amount sufficient to eliminate such excess.

 

(f)  Subject
to Section 2.13(j), mandatory prepayments of Term Loans pursuant to
paragraphs (b), (c) and (d) above shall be allocated
pro rata among the Classes of Term Loans and, within each Class and subject to paragraph (i)
below, shall be applied to reduce ratably the remaining Term Loan Repayment
Amounts for such Class; provided, however, that, subject to Section
2.16 (i) the Borrowers may allocate and apply up to U.S.$100,000,000
of Excess Cash Flow required to be used to prepay Term Loans hereunder in any
year to any Class or Classes of Term Loans and the remaining Term Loan
Repayment Amounts for each such Class at their discretion and (ii) mandatory
prepayments of the Term Loans from Asset Sales shall be applied as follows:
(A) in the case of assets owned by SSCC, SSCE or any Domestic Subsidiary
(other than any Domestic Subsidiary that is a subsidiary of a Canadian
Subsidiary), to Tranche B Loans and Other Term Loans made to SSCE until
and unless such Term Loans have been paid in full and, thereafter, to the other
Term Loans in accordance with this paragraph (f), and (B) in the
case of assets owned by any Canadian Subsidiary or any subsidiaries of a
Canadian Subsidiary, to the Tranche C Loans and Other Term Loans made to
SSC Canada until and unless such Term Loans have been paid in full and,
thereafter, to the other Term Loans in accordance with this paragraph (f).

 

(g)  The
applicable Borrower shall deliver to the Administrative Agent, (i) at the
time of each prepayment by such Borrower required under paragraph (b),
(c) or (d) above, a certificate signed by a Financial Officer of
such Borrower setting forth in reasonable detail the calculation of the amount
of such prepayment and (ii) at least three Business Days prior to the time
of each prepayment required under this Section 2.13, a notice of
such prepayment.  Each notice of
prepayment shall specify the prepayment date, the Class and Type of each Loan
being prepaid (which specification shall comply with this Section 2.13)
and the principal amount of each Term Loan (or portion thereof) to be
prepaid.  All prepayments of Borrowings
under this Section 2.13 shall be subject to Section 2.15
and shall be accompanied by accrued but unpaid interest on the principal amount
paid to but excluding the date of payment, but shall otherwise be without
premium or penalty.

 

62

 

(h)  To
the extent consistent with paragraph (f) above, amounts to be
applied pursuant to this Section 2.13 to the prepayment of Loans
shall be applied to reduce outstanding ABR Loans and, if applicable, Canadian
Prime Rate Loans prior to being applied to reduce Loans of any other Type.  In the case of any mandatory prepayment of
Eurodollar Loans pursuant to this Section 2.13 (other than any
mandatory prepayment of Loans of any Class required in connection with the
expiration or termination in whole of Commitments of such Class), the
applicable Borrower may, at its option, deposit into the Prepayment Account (as
defined below) an amount in cash equal to such mandatory prepayment rather than
prepaying such Loan on the date otherwise due pursuant to this Section 2.13.  The Administrative Agent shall apply any cash
deposited into the Prepayment Account solely to prepay Eurodollar Loans with
respect to which such deposit has been made on the last day of the applicable
Interest Periods (or on an earlier date if (i) directed to do so by the
applicable Borrower or (ii) an Event of Default shall have occurred and is
continuing).  For purposes of this
Agreement, the term “Prepayment Account” shall mean an account
established by the applicable Borrower with the Administrative Agent and over
which the Administrative Agent shall have exclusive dominion and control, including
the exclusive right of withdrawal for application in accordance with this paragraph (h).  Each Borrower hereby grants to the
Administrative Agent, for the benefit of the Administrative Agent and the
Lenders, a security interest in the Prepayment Account to secure the
Obligations owed to such Persons.  The
Administrative Agent will, at the request of the applicable Borrower, invest
amounts on deposit in the Prepayment Account in Permitted Investments that mature
prior to the last day of the applicable Interest Periods of the Eurodollar
Borrowings to be prepaid; provided, however, that (A) the
Administrative Agent shall not be required to make any investment that, in its
sole judgment, would result in any violation of any law, statute, rule or
regulation and (B) the Administrative Agent shall have no obligation to
invest amounts on deposit in the Prepayment Account if a Default or an Event of
Default shall have occurred and be continuing. 
The Borrowers shall indemnify the Administrative Agent for any losses
relating to the investments so that the amount available to prepay Eurodollar
Borrowings on the day due pursuant to the third preceding sentence is not less
than the amount that would have been available had no investments been made
pursuant thereto.  So long as no Default
or Event of Default shall have occurred and be continuing, interest or profits,
if any, resulting from investment of amounts on deposit in the Prepayment
Account shall be distributed by the Administrative Agent to the applicable Borrower
upon the payment of the Eurodollar Borrowing with respect to which such deposit
has been made.  Other than any interest
or profits resulting from such investments, the Prepayment Account shall not
bear interest.

 

(i)  Notwithstanding
the requirements of paragraph (f) above and provided that no
Default or Event of Default shall have occurred and be continuing, with respect
to any mandatory prepayment of Term Loans required pursuant to this Section
2.13, the Borrowers may, not less than 10 nor more than 20 Business
Days prior to the date specified for such prepayment (the “Mandatory
Prepayment Date”), provide to each Term Lender a written notice that shall
refer to this paragraph (i) and shall (i) set forth the amount of
such prepayment (the “Prepayment Amount”) and the portion thereof that
the applicable Term Lender (each, a “Prepayment Lender”) would be
entitled to receive if it accepts such mandatory prepayment in accordance with
this paragraph (i), (ii) request

 

63

 

such Prepayment Lender to
notify the Borrowers and the Administrative Agent in writing no later than the
Business Day prior to the Mandatory Prepayment Date of such Prepayment Lender’s
acceptance or rejection (in each case, in whole and not in part) of its share
of the Prepayment Amount and (iii) inform such Prepayment Lender that
failure by such Prepayment Lender to reject in writing its share of the
Prepayment Amount on or before the Business Day prior to the Mandatory
Prepayment Date shall be deemed to be an acceptance of such amount.  On the Mandatory Prepayment Date, the
Borrowers shall prepay that portion of the Prepayment Amount in respect of
which such Prepayment Lenders have accepted prepayment as described above (such
Prepayment Lenders, the “Accepting Lenders”), such prepayment to be
applied pro rata to the remaining Term Loan Repayment Amounts for the
applicable Class of Term Loans.  So long
as no Default or Event of Default shall have occurred and be continuing, SSCC
and the Subsidiaries shall apply any portion of the Prepayment Amount not
applied as provided in the immediately preceding sentence to the repayment of
Indebtedness of SSCC and the Subsidiaries maturing on or prior to the Term Loan
Maturity Date.  In the event that any provision
of this Section 2.13 requires prepayment of the Term Loans prior to
the selected Mandatory Prepayment Date, the Borrowers shall deposit the entire
amount of the Prepayment Amount into an account under the exclusive control and
dominion of the Administrative Agent.

 

(j)  Notwithstanding
anything to the contrary contained in this Agreement, no prepayment of the
Tranche C Loans or Other Term Loans made to SSC Canada shall be required
to be made under Section 2.11 or this Section 2.13 to
the extent that such prepayment or the obligation to make such prepayment would
result in SSC Canada being obligated under any circumstances to pay more than
25% of the original principal amount of the Tranche C Loans or such Other
Term Loans (the “Threshold Amount”) prior to the fifth anniversary of
the respective dates on which such Loans were made.  The amount of such prepayments in excess of
the Threshold Amount (the “Excess Amount”) will be allocated pro rata to
the further prepayment of the Tranche B Loans and Other Term Loans made to
SSCE and applied pro rata to the remaining Term Loan Repayment Amounts for
Loans of such Classes until such Loans have been paid in full.  On the Business Day immediately after the
fifth anniversary of the date on which such Loans were respectively made, the
Excess Amount not previously applied to the further prepayment of the
Tranche B Loans and Other Term Loans made to SSCE shall be paid pro rata
to the Tranche C Lenders and Incremental Term Lenders that shall have made
Other Term Loans to SSC Canada and shall be applied pro rata to the remaining
Term Loan Repayment Amounts for Loans of such Classes.

 

SECTION 2.14.  Reserve Requirements; Change in
Circumstances; Increased Costs.  (a)  Notwithstanding any other provision herein,
if after the Closing Date any change in applicable law or regulation or in the
interpretation or administration thereof by any Governmental Authority charged
with the interpretation or administration thereof (whether or not having the
force of law) shall impose, modify or deem applicable any reserve, special
deposit or similar requirement against assets of, deposits with or for the
account of or credit extended by any Lender or any Facing Agent (except any
such reserve requirement that is reflected in the Adjusted LIBO Rate, the
Alternate Base Rate or the Canadian Prime Rate) or shall impose on any Lender
or any Facing Agent or the

 

64

 

London or Canadian interbank
market any other condition affecting this Agreement or Loans made by such
Lender or any Letter of Credit obligations, and the result of any of the
foregoing shall be to increase the cost to such Lender of making or maintaining
any Loan or of issuing or maintaining any Letter of Credit or purchasing or
maintaining a participation therein or to reduce the amount of any sum received
or receivable by any Lender or any Facing Agent hereunder (whether of
principal, interest or otherwise) by an amount deemed by such Lender or such
Facing Agent to be material, then the applicable Borrower will pay to such
Lender or such Facing Agent, following receipt by such Borrower of a
certificate of such Lender or such Facing Agent to such effect in accordance
with Section 2.14(c), such additional amount or amounts as will
compensate such Lender or such Facing Agent on an after-tax basis for such
additional costs incurred or reduction suffered; provided, however,
that none the Lenders or the Facing Agents shall be entitled to demand
compensation pursuant to this paragraph (a) if it shall not be
the general practice of such Lender or such Facing Agent, as applicable, to
demand such compensation in similar circumstances under comparable provisions
of other comparable credit agreements.

 

(b)  If
any Lender or any Facing Agent shall have determined that the adoption after
the Closing Date of any law, rule, regulation, agreement or guideline regarding
capital adequacy, or any change in any of the foregoing or in the
interpretation or administration of any of the foregoing by any Governmental
Authority, central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by any Lender (or any lending office of
such Lender) or Facing Agent or any Lender’s or any Facing Agent’s holding
company, if any, with any request or directive regarding capital adequacy
issued under any law, rule, regulation or guideline (whether or not having the
force of law) of any such Governmental Authority, central bank or comparable
agency, has or would have the effect of reducing the rate of return on such
Lender’s or such Facing Agent’s capital or on the capital of such Lender’s or
such Facing Agent’s holding company, if any, as a consequence of this Agreement
or the Loans made by, or participations in Letters of Credit held by, such
Lender, or the Letters of Credit issued by such Facing Agent pursuant hereto,
to a level below that which such Lender or such Facing Agent or such Lender’s
or such Facing Agent’s holding company, if any, could have achieved but for
such applicability, adoption, change or compliance (taking into consideration
such Lender’s or such Facing Agent’s policies and the policies of such Lender’s
or such Facing Agent’s holding company, if any, with respect to capital
adequacy) by an amount deemed by such Lender or such Facing Agent to be
material, then from time to time the applicable Borrower shall pay to such
Lender or such Facing Agent, following receipt by such Borrower of a
certificate of such Lender or such Facing Agent to such effect in accordance with
Section 2.14(c), such additional amount or amounts as will
compensate such Lender or such Facing Agent or such Lender’s or such Facing
Agent’s holding company, if any, on an after-tax basis for any such reduction
suffered; provided, however, that none of the Lenders or Facing
Agents shall be entitled to demand compensation pursuant to this paragraph (b) if
it shall not be the general practice of such Lender or such Facing Agent, as
applicable, to demand such compensation in similar circumstances under comparable
provisions of other comparable credit agreements.

 

65

 

(c)  A
certificate of a Lender or a Facing Agent setting forth such amount or amounts
as shall be necessary to compensate such Lender or such Facing Agent or its
holding company, if any, as specified in paragraph (a) or (b)
above, as the case may be, and setting forth in reasonable detail an
explanation of the basis of requesting such compensation in accordance with paragraph (a)
or (b) above, including calculations in reasonable detail, shall be
delivered to the applicable Borrower and shall be conclusive absent manifest
error.  The applicable Borrower shall pay
such Lender or such Facing Agent the amount shown as due on any such
certificate delivered by it within 10 days after such Borrower’s receipt
of the same.

 

(d)  Failure
on the part of any Lender or any Facing Agent to demand compensation for any
increased costs or reduction in amounts received or receivable or reduction in
return on capital with respect to any period shall not constitute a waiver of
such Lender’s or such Facing Agent’s right to demand compensation with respect
to such period or any other period, except that none of the Lenders or Facing
Agents shall be entitled to compensation under this Section 2.14
for any costs incurred or reduction suffered with respect to any date unless
such Lender or such Facing Agent, as applicable, shall have notified the
applicable Borrower that it will demand compensation for such costs or
reductions under paragraph (c) above not more than six months after
the later of (i) such date and (ii) the date on which such Lender or
such Facing Agent, as applicable, shall have become aware of such costs or
reductions.  The benefits of this Section 2.14
shall be available to each Lender and each Facing Agent regardless of any
possible contention of the invalidity or inapplicability of the law, rule,
regulation, guideline or other change or condition that shall have occurred or
been imposed.

 

SECTION 2.15.  Indemnity.  Each Borrower shall indemnify each Lender
against any loss or expense that such Lender may sustain or incur with respect
to Eurodollar Loans or B/A Loans as a consequence of (a) any failure by
such Borrower to fulfill on the date of any Borrowing hereunder the applicable
conditions set forth in Article V, (b) any failure by such
Borrower to borrow or to convert or continue any Loan hereunder after
irrevocable notice of such borrowing, conversion or continuation has been given
pursuant to Section 2.03 or 2.10, (c) any payment,
prepayment or conversion of a Eurodollar Loan or B/A Loan required or permitted
by any other provision of this Agreement or otherwise, or any assignment of a
Eurodollar Loan or B/A Loan required by Section 2.20(b), in each
case made or deemed made on a date other than the last day of the Interest
Period or Contract Period, as the case may be, applicable thereto, (d) any
purchase of a participation pursuant to Article X of a Eurodollar
Loan or a B/A Loan of such Borrower otherwise made or deemed made on a date
other than the last day of the Interest Period or Contract Period, as the case
may be, applicable thereto, or (e) any default in payment or prepayment of
the principal amount of any Loan or any part thereof or interest accrued
thereon, as and when due and payable (at the due date thereof, whether at
scheduled maturity, by acceleration, irrevocable notice of prepayment or
otherwise), including, in each such case, any loss or reasonable expense
sustained or incurred or to be sustained or incurred in liquidating or
employing deposits from third parties acquired to effect or maintain such Loan
or any part thereof as a Eurodollar Loan or B/A Loan, as the case may be.  Such loss or reasonable expense shall be
equal to the sum of (i) such Lender’s actual costs and expenses incurred
(other than any lost profits)

 

66

 

in connection with, or by
reason of, any of the foregoing events and (ii) an amount equal to the
excess, if any, as reasonably determined by such Lender, of (A) its cost
of obtaining the funds for the Loan being paid, prepaid, converted or not
borrowed, converted or continued (assumed to be the Adjusted LIBO Rate or the
Discount Rate, as applicable, applicable thereto) for the period from and
including the date of such payment, prepayment, conversion or failure to
borrow, convert or continue to but excluding the last day of the Interest
Period or Contract Period, as the case may be, for such Loan (or, in the case
of a failure to borrow, convert or continue, the Interest Period or Contract
Period for such Loan that would have commenced on the date of such failure)
over (B) the amount of interest (as reasonably determined by such Lender)
that would be realized by such Lender in reemploying the funds so paid,
prepaid, converted or not borrowed, converted or continued for such period,
Interest Period or Contract Period, as the case may be.  A certificate of any Lender setting forth any
amount or amounts, including calculations in reasonable detail, that such
Lender is entitled to receive pursuant to this Section 2.15 shall
be delivered to the applicable Borrower and shall be conclusive absent manifest
error.

 

SECTION 2.16.  Pro Rata Treatment.  Except as permitted under Section 2.13(i)
and other than in connection with Swingline Loans, each Borrowing, each payment
or prepayment of principal of any Borrowing, each payment of interest on the
Loans, each payment of the Deposit Return and the Fees due to the Lenders, each
reduction of the Commitments of a Class and each conversion of any Borrowing to
or continuation of any Borrowing as a Borrowing of any Type shall be allocated
pro rata among the Lenders in accordance with their respective applicable
Commitments (provided that (x) in the case of Term Loans or
(y) in the event that such Commitments shall have expired or been
terminated, such pro rata allocation shall be based on the respective principal
amounts of the outstanding Loans (other than Swingline Loans) and/or
participations in LC Disbursements and Swingline Loans, as applicable).  Each Lender agrees that in computing such
Lender’s portion of any Borrowing to be made hereunder, the Administrative
Agent may, in its discretion, round each Lender’s percentage of such Borrowing,
computed in accordance with Section 2.01, to the next higher or
lower whole U.S. Dollar or Canadian Dollar amount, as applicable.  In addition, each Lender agrees that the
Administrative Agent may, in its sole discretion, increase or reduce any
Revolving (Canadian) Lender’s portion of a B/A Loan to the extent provided in Section 2.22(e).

 

SECTION 2.17.  Sharing of Setoffs and Realization of
Security.  Each Lender agrees that if
it shall through the exercise of a right of banker’s lien, combination of
accounts, setoff or counterclaim against any Loan Party, or pursuant to a
secured claim under any applicable Insolvency Law or other security or interest
arising from, or in lieu of, such secured claim, received by such Lender under
any applicable Insolvency Law or otherwise, or pursuant to any Bank Act
Security held by such Lender, or by any other means, obtain payment (voluntary
or involuntary) in respect of any Loans or participations in LC Disbursements
and accrued interest thereon as a result of which the unpaid principal portion
of its Loans and participations in LC Disbursements and accrued interest
thereon shall be proportionately less than the unpaid principal portion of the
Loans and participations in LC Disbursements and accrued interest thereon of
any other

 

67

 

Lender, such Lender shall be
deemed simultaneously to have purchased from such other Lender at face value,
and shall promptly pay to such other Lender the purchase price for, a
participation in the Loans and participations in LC Disbursements and accrued
interest thereon of such other Lender, so that the benefit of all such payments
shall be shared by the Lenders ratably in accordance with the aggregate amount
of the principal of and accrued interest on their respective Loans and
participations in LC Disbursements; provided, however, that if
any such purchase or purchases or adjustments shall be made pursuant to this Section 2.17
and the payment giving rise thereto shall thereafter be recovered, such
purchase or purchases or adjustments shall be rescinded to the extent of such
recovery and the purchase price or prices or adjustment restored without
interest.  Each Borrower expressly
consents to the foregoing arrangements and agrees that any Lender holding a participation
pursuant to the foregoing arrangements may, subject to the terms of Section
11.06, exercise any and all rights of banker’s lien, combination of
accounts or setoff with respect to any and all moneys owing by the Loan Parties
to such Lender by reason thereof as fully as if such Lender were a direct
creditor of such Borrower in the amount of such participation.

 

SECTION 2.18.  Payments.  (a)  Each
Borrower shall make each payment (including payment of principal of or interest
on any Loan or any Fees) hereunder and under any other Loan Document not later
than 12:00 noon, Standard Time, on the date when due in immediately available
funds, without defense, setoff or counterclaim. 
All payments hereunder of principal or interest in respect of any Loan (or
of any breakage indemnity in respect of any Loan) shall be made in the currency
of such Loan; all other payments hereunder and under each other Loan Document
shall be made in U.S. Dollars, except as otherwise expressly provided.  Each such payment (other than (i) the
payments specified in Sections 2.05 and 3.05 to be made to
the Facing Agents, which shall be paid directly to the applicable Facing Agent,
(ii) payments of principal of and interest on Swingline Loans, which shall
be paid directly to the Swingline Lender, except as set forth in Section
2.21(c), and (iii) payments pursuant to Sections 2.14, 2.15, 2.19
and 11.05, which shall be made to the Persons entitled thereto) shall be
made to such account of the Administrative Agent or the Canadian Administrative
Agent, as applicable, as such agent shall specify by notice to the applicable
Borrower.  Payments made directly to a
Facing Agent shall be made to such account of the Facing Agent as such Facing
Agent shall specify by notice to the applicable Borrower.  Payments made directly to the Swingline
Lender shall be made to such account of the Swingline Lender as the Swingline
Lender shall specify by notice to SSCE. 
Any payments received by the Administrative Agent, the Canadian
Administrative Agent, any Facing Agent or the Swingline Lender after the
specified time for receipt of such payment on any day shall be deemed to have
been received on the next Business Day. 
The Administrative Agent or the Canadian Administrative Agent, as
applicable, shall distribute to the applicable Lenders all payments received by
it for their respective accounts, promptly following receipt thereof; provided,
however, that in case of any prepayment of the Deposit Funded Loans
pursuant to Section 2.12 or 2.13, the Administrative Agent
shall not so distribute any payments received by it, but shall instead remit
all such payments promptly following receipt thereof to the Deposit Account
Agent, and the Deposit Account Agent shall deposit all such payments received
by it into the Deposit Account promptly following receipt thereof.

 

68

 

(b)  Whenever
any payment (including any payment of principal of or interest on any Borrowing
or any Fees) hereunder or under any other Loan Document shall become due, or
otherwise would occur, on a day that is not a Business Day, such payment may be
made on the next succeeding Business Day, and such extension of time shall in
such case be included in the computation of interest or Fees, if applicable.

 

SECTION 2.19.  Taxes. 
(a)  Any and all payments by the
Loan Parties hereunder and under the other Loan Documents shall be made free
and clear of and without deduction for any and all current or future taxes,
levies, imposts, deductions, charges or withholdings, and all liabilities with
respect thereto, excluding, with respect to the Administrative Agent,
any Facing Agent or any Lender (or any transferee or assignee of any of the
foregoing, including a participation holder (any such entity being called a “Transferee”))
branch profits taxes and taxes imposed on the net income of the Administrative
Agent, such Facing Agent or such Lender (or Transferee), as the case may be,
and franchise taxes imposed on the Administrative Agent, such Facing Agent or
such Lender (or Transferee), as the case may be, by the United States, Canada
or any jurisdiction under the laws of which the Administrative Agent, such
Facing Agent or such Lender (or Transferee) is organized or in which the
Administrative Agent, such Facing Agent or such Lender (or Transferee) has its
principal office or lending office or any political subdivision or taxing
authority thereof or therein or in any other jurisdiction in which the
Administrative Agent, such Facing Agent or such Lender (or Transferee) is otherwise
doing business (or, if a treaty applies, a jurisdiction in which the
Administrative Agent, such Facing Agent or such Lender (or Transferee) has a
permanent establishment) other than any jurisdiction in which the
Administrative Agent, such Facing Agent or such Lender (or Transferee) is
treated as doing business (or, if a treaty applies, is treated as having a
permanent establishment) solely by reason of having executed, delivered or
performed its obligations or received a payment under this Agreement or any
other Loan Document (all such nonexcluded taxes, levies, imposts, deductions,
charges, withholdings and liabilities being hereinafter referred to as “Taxes”).  If any Taxes are required to be deducted from
or in respect of any sum payable hereunder by any Loan Party to any Lender (or
any Transferee), the Administrative Agent or any Facing Agent, (i) the sum
payable shall be increased by the amount necessary so that after making all
required deductions (including deductions applicable to additional sums payable
under this Section 2.19) such Lender (or Transferee), the
Administrative Agent or such Facing Agent, as the case may be, shall receive an
amount equal to the sum it would have received had no such deductions been
made, (ii) the Borrowers shall make such deductions and (iii) the
Borrowers shall pay the full amount deducted to the relevant taxing authority
or other Governmental Authority in accordance with applicable law; provided,
however, that, if a Lender assigns, participates or otherwise transfers
all or any portion of its rights under this Agreement or any other Loan
Document or changes its lending office for the purposes of this Agreement and
as a result of circumstances existing at the date of the assignment,
participation, other transfer or change in lending office, a Borrower would be
obligated to pay any amount under this paragraph (a), then the
Transferee or Lender acting through its new lending office shall only be
entitled to receive payment under this paragraph (a) to the same
extent that the previous Lender or the Lender acting through its previous
lending office would have been entitled if no such assignment, participation,
other transfer or change in lending office had taken place

 

69

 

unless (x) such
assignment, participation or transfer shall have been at the request of SSCC or
a Borrower, (y) such assignment, participation or transfer shall have been
made pursuant to Section 2.17 or Article X or (z) such
assignment, participation or transfer is of a Revolving (Canadian) Credit
Commitment or a Revolving (Canadian) Loan and is made at a time when an Event
of Default has occurred and is continuing.

 

(b)  Each
Borrower agrees to pay any current or future stamp, intangible or documentary taxes
or any other excise or property taxes, charges or similar levies (including
mortgage recording taxes and similar fees) that arise from any payment made
hereunder or from the execution, delivery or registration of, or otherwise with
respect to, this Agreement, any Assignment and Acceptance entered into at the
request of either Borrower or any other Loan Document (hereinafter referred to
as “Other Taxes”).

 

(c)  Each
Borrower will indemnify each Lender (or Transferee), the Administrative Agent
and each Facing Agent for the full amount of Taxes and Other Taxes (including
any Taxes or Other Taxes on amounts payable under this Section 2.19)
paid by such Lender (or Transferee), the Administrative Agent, or such Facing
Agent, as the case may be, and any liability (including penalties, interest and
reasonable expenses) arising therefrom or with respect thereto, whether or not
such Taxes or Other Taxes were correctly or legally asserted by the relevant
taxing authority or other Governmental Authority.  Such indemnification shall be made within
30 days after the date any Lender (or Transferee), the Administrative
Agent or any Facing Agent, as the case may be, makes written demand therefor
(which demand shall identify the nature and amount of Taxes and Other Taxes for
which indemnification is being sought and shall include a copy of the relevant
portion of any written assessment from the relevant taxing authority demanding
payment of such Taxes or Other Taxes, unless the Lender (or Transferee), the
Administrative Agent or such Facing Agent, as the case may be, determines, in
its sole discretion, that such portion of any such assessment is
confidential).  If a Lender (or
Transferee), the Administrative Agent or any Facing Agent shall become aware
that it is entitled to receive a refund in respect of Taxes or Other Taxes as
to which it has been indemnified by the applicable Borrower pursuant to this Section 2.19,
it shall promptly notify such Borrower of the availability of such refund and
shall, within 30 days after receipt of a request by the applicable
Borrower, apply for such refund at such Borrower’s expense.  If any Lender (or Transferee), the
Administrative Agent or any Facing Agent receives a refund in respect of any
Taxes or Other Taxes as to which it has been indemnified by either Borrower
pursuant to this Section 2.19, it shall promptly notify such
Borrower of such refund and shall, within 30 days of receipt, repay such
refund (to the extent of amounts that have been paid by such Borrower under
this Section 2.19 with respect to such refund and not previously
reimbursed) to the Borrower, net of all reasonable out-of-pocket expenses of
such Lender, the Administrative Agent or such Facing Agent and without interest
(other than the interest, if any, included in such refund net of any Taxes
payable with respect to receipt of such refund), provided that such
Borrower, upon the request of such Lender (or Transferee), the Administrative
Agent or such Facing Agent, agrees to return such refund (plus
penalties, interest or other charges) to such Lender (or Transferee), the
Administrative Agent or such Facing Agent in the event such Lender (or
Transferee), the Administrative Agent or such Facing Agent, as the case may be,
is required to repay such refund.

 

70

 

(d)  Within
30 days after the date of any payment of Taxes or Other Taxes withheld by
either Borrower in respect of any payment to any Lender (or Transferee), the
Administrative Agent or any Facing Agent, such Borrower will furnish to the
Administrative Agent, at the addresses referred to in Section 11.01,
the original or a certified copy of a receipt evidencing payment thereof or
other evidence reasonably satisfactory to such Lender (or Transferee), the
Administrative Agent or such Facing Agent, as the case may be.

 

(e)  Without
prejudice to the survival of any other agreement contained herein, the
agreements and obligations contained in this Section 2.19 shall
survive the payment in full of the principal of and interest on all Loans made
hereunder.

 

(f)  (i) Each of the Administrative Agent, the
Senior Agents, the Deposit Funded Facility Agent, the Revolving Facility Facing
Agent and any SSCE Lender (or Transferee) that is not a U.S. person (within the
meaning of Section 7701(a)(30) of the Code) (a “Non-U.S. Person”)
agrees that it shall on the date it becomes the Administrative Agent, the
Senior Agent, the Deposit Funded Facility Facing Agent, the Revolving Facility
Facing Agent or a SSCE Lender (or Transferee) hereunder, deliver to SSCE and
the Administrative Agent (A) one duly completed copy of United States
Internal Revenue Service Form W-8BEN or W-8ECI (or replacement or
successor forms thereto), or (B) in the case of SSCE Lenders (or
Transferees thereof) exempt from United States Federal withholding tax pursuant
to Sections 871(h) or 881(c) of the Code, one duly completed copy of a
United States Internal Revenue Service Form W-8BEN (Certificate of
Foreign Status of Beneficial Owner for United States Tax Withholding) and a
certificate representing that such Non-U.S. Person is not a bank for
purposes of Section 881(c) of the Code, or any successor applicable
form of any thereof, certifying in each case that the Administrative Agent,
such Senior Agent, the Deposit Funded Facility Facing Agent, the Revolving
Facility Facing Agent or such SSCE Lender (or Transferee), as the case may be,
is entitled to receive payments hereunder payable to it without deduction or
withholding of any United States Federal income taxes.  Each of the Administrative Agent, the
Revolving Facility Facing Agent, the Senior Agents, the Deposit Funded Facility
Facing Agent and the SSCE Lenders (or Transferee) that, pursuant to the
immediately preceding sentence is required to deliver to SSCE and the Administrative
Agent any such form or certification, further undertakes to deliver to SSCE and
the Administrative Agent further copies of any such form or certification or
other manner of certification reasonably satisfactory to SSCE on or before the
date that any such form or certification expires or becomes obsolete or of the
occurrence of any event requiring a change in the most recent form or
certification previously delivered by it to SSCE or the Administrative Agent,
and such extensions or renewals thereof as may reasonably be requested by SSCE
or the Administrative Agent, certifying that the Administrative Agent, the
Revolving Facility Facing Agent, such Senior Agent, the Deposit Funded Facility
Facing Agent, or such SSCE Lender (or Transferee), as the case may be, is
entitled to receive payments hereunder without deduction or withholding of any
United States Federal income taxes, unless there has occurred, on or prior to
the date on which any delivery of

 

71

 

any such form
or certification would otherwise be required, any change in law, rule,
regulation, treaty, convention or directive, or any change in the
interpretation or application of any thereof (“Change of Law”) that
renders all such forms or certification inapplicable or which would prevent the
Administrative Agent, the Revolving Facility Facing Agent, such Senior Agent,
the Deposit Funded Facility Facing Agent or such SSCE Lender (or Transferee),
as the case may be, from duly completing and delivering any such form or
certification with respect to it.  In the
event of such Change of Law, the Administrative Agent, such Senior Agent, the
Deposit Funded Facility Facing Agent, the Revolving Facility Facing Agent or such
SSCE Lender (or Transferee), as the case may be, shall advise SSCE that under
applicable law it shall be subject to withholding of United States Federal
income tax at the full statutory rate, a reduced rate of withholding or without
deduction or withholding. 
Notwithstanding the foregoing provisions of this paragraph (f),
a Revolving (Canadian) Lender that is a Non-U.S. Person shall be required
to furnish any such form or certification only if it is entitled to claim an
exemption from, or a reduced rate, of withholding.  Each of the Administrative Agent, the Senior
Agents, the Deposit Funded Facility Facing Agent, the Revolving Facility Facing
Agent and the SSCE Lenders (other than any Revolving (Canadian) Lender) that is
a Non-U.S. Person and that is a party hereto as of the date hereof hereby
represents and warrants that, as of the date hereof, all payments made to it
hereunder are exempt from withholding of United States Federal income taxes
(i) because such payments are effectively connected with a United States
trade or business conducted by such Non-U.S. Person; (ii) pursuant
to the terms of an income tax treaty between the United States and such Non-U.S.
Person’s country of residence; or (iii) because such payments are
portfolio interest exempt pursuant to Section 871(h) or 881(c) of the
Code.

 

(ii) Notwithstanding
anything contained in clause (i) above, in the case of an assignment,
participation or transfer made at the request of a Borrower or an assignment,
participation or transfer made pursuant to Section 2.17 or Article X,
if a Transferee, in its good faith judgment, is eligible for an exemption from,
or reduced rate of, U.S. Federal withholding tax on payments by the Loan
Parties hereunder, such Transferee shall use its reasonable best efforts to
provide SSCE and the Administrative Agent with the appropriate forms and
certifications that will permit such payments to be made without withholding or
at a reduced rate.

 

(iii) The
Administrative Agent, any Senior Agent, any Facing Agent and each Lender (or
Transferee) that is a U.S. person within the meaning of
Section 7701(a)(30) of the Code (other than any such person that is
treated as a corporation for United States federal income tax purposes) shall
deliver to the Administrative Agent on or before the date such Person becomes a
party to this Agreement a duly completed United States Internal Revenue Service
Form W-9 (or successor form) establishing that such Person is not subject to
U.S. federal backup withholding.

 

(iv) Notwithstanding
any provision of this Section 2.19 above to the contrary, SSCE shall not
have any obligation to pay any Taxes or Other Taxes or to

 

72

 

indemnify any
SSCE Lender (or Transferee), the Administrative Agent, any Senior Agent, the
Deposit Funded Facility Facing Agent or the Revolving Facility Facing Agent for
such Taxes or Other Taxes pursuant to this Section 2.19 to the
extent that such Taxes or Other Taxes result from (i) the failure of such
SSCE Lender (or Transferee), the Administrative Agent, such Senior Agent, or
such Facing Agent to comply with its obligations pursuant to this paragraph (f)
or (ii) any representation made hereunder or on any such form or
certification (or successor applicable form or certification) by the SSCE
Lender (or Transferee), the Administrative Agent, such Senior Agent, or such
Facing Agent incurring such Taxes or Other Taxes proving to have been
incorrect, false or misleading in any material respect when so made or deemed
to be made.  Nothing contained herein
shall require the Administrative Agent, any Senior Agent, the Deposit Funded
Facility Facing Agent, the Revolving Facility Facing Agent or any SSCE Lender
(or Transferee) to make its tax returns (or any other information relating to
its taxes which it deems confidential) available to SSCE or any other person.

 

(g)  Each
of the Canadian Administrative Agent, the Revolving (Canadian) Facility Facing
Agent and any SSC Canada Lender (or Transferee) that is entitled to an
exemption from or reduction of withholding tax under the laws of Canada, or any
treaty to which Canada is a party, with respect to payment in connection with
the SSC Canada Loans under this Agreement shall, upon request by the
Administrative Agent, deliver to SSC Canada (with a copy to the Administrative
Agent), such properly completed and executed documentation prescribed by
applicable law or reasonably requested by SSC Canada as will permit such
payments to be made without withholding or at a reduced rate.  Notwithstanding any provision of paragraph (a)
above to the contrary, SSC Canada shall have no obligation to pay any Taxes or
Other Taxes or to indemnify any SSC Canada Lender (or Transferee), the Canadian
Administrative Agent or the Revolving (Canadian) Facility Facing Agent for such
Taxes or Other Taxes pursuant to this Section 2.19 to the extent
that such Taxes or Other Taxes result from (x) the failure of any SSC
Canada Lender, the Canadian Administrative Agent or such Facing Agent to comply
with its obligations pursuant to this paragraph (g) (provided,
however, that no SSC Canada Lender shall be required to provide any
documentation that it is not legally able to provide) or (y) any
representation made in any such documentation by the SSC Canada Lender, the
Canadian Administrative Agent or such Facing Agent incurring such Taxes or
Other Taxes proving to have been incorrect, false or misleading in any material
respect when so made or deemed to be made. 
Nothing contained herein shall require the Administrative Agent, the Revolving
(Canadian) Facility Facing Agent or any SSC Canada Lender (or Transferee) to
make its tax returns (or any other information relating to its taxes which it
deems confidential) available to SSC Canada or any other Person.

 

SECTION 2.20.  Duty to Mitigate; Replacement of Lenders.  (a)  Any
of the Administrative Agent, the Facing Agents or the Lenders (or Transferees)
claiming any additional amounts payable pursuant to Section 2.14 or
2.19 shall use reasonable efforts (consistent with legal and regulatory
restrictions) to file any certificate or document requested by either Borrower
or to change the jurisdiction of its applicable lending office if the making of
such filing or change would avoid the need for or reduce

 

73

 

the amount of any such additional
amounts that may thereafter accrue or avoid the circumstances giving rise to
such exercise and would not, in the sole determination of such Lender (or
Transferee), the Administrative Agent or such Facing Agent, as the case may be,
require it to incur additional costs or be otherwise disadvantageous to such
Lender (or Transferee), the Administrative Agent or such Facing Agent.

 

(b)  In
the event that any Lender shall have delivered a notice or certificate pursuant
to Section 2.14 or defaults in its obligations to make Loans
hereunder, or either Borrower shall be required to make additional payments to
any Lender under Section 2.19, the applicable Borrower shall have
the right, but not the obligation, at its own expense (including with respect
to the processing and recordation fee referred to in Section 11.04(b)),
upon notice to such Lender and the Administrative Agent (and, in the case of
any replacement of a Deposit Funded Lender, the Deposit Account Agent), to
replace such Lender with an assignee (in accordance with and subject to the
restrictions contained in Section 11.04(b)) approved by the
Administrative Agent (and, in the case of a Deposit Funded Lender, the Deposit
Account Agent), which approval shall not be unreasonably withheld, and such
Lender hereby agrees to transfer and assign without recourse (in accordance
with and subject to the restrictions contained in Section 11.04(b))
all its interests, rights and obligations under this Agreement to such
assignee; provided, however, that no Lender shall be obligated to
make any such assignment unless (i) such assignment shall not conflict
with any law or any rule, regulation or order of any Governmental Authority,
(ii) such assignee shall pay to the affected Lender in immediately
available funds on the date of such assignment the principal of the Loans made
by such Lender hereunder and (iii) the applicable Borrower shall pay to
the affected Lender in immediately available funds on the date of such
assignment the interest accrued to the date of payment on the Loans made by
such Lender hereunder and all other amounts accrued for such Lender’s account
or owed to it hereunder.

 

(c)  If,
in connection with any proposed amendment, modification, change, waiver,
discharge or termination to any of the provisions of this Agreement as
contemplated by Section 11.08(b), the consent of the Required
Lenders is obtained but the consent of one or more of such other Lenders whose
consent is required is not obtained, then the applicable Borrower shall have
the right, but not the obligation, at its own expense (including with respect
to the processing and recordation fee referred to in Section 11.04(b))
upon notice to such Lender and the Administrative Agent (and, in the case of
any replacement of a Deposit Funded Lender, the Deposit Account Agent), to
replace each such non-consenting Lender or Lenders (or, at the option of the
applicable Borrower, if such Lender’s consent is required with respect to less
than all Loans, to replace only the respective Loans of the respective
non-consenting Lender which gave rise to the need to obtain such Lender’s
individual consent) with an assignee (in accordance with and subject to the
restrictions contained in Section 11.04(b)) approved by the
Administrative Agent (and, in the case of a Deposit Funded Lender, the Deposit
Account Agent), which approval shall not be unreasonably withheld, so long as
at the time of such replacement, each such assignee consents to the proposed
amendment, modification, change, waiver, discharge or termination; provided,
however, that no Lender shall be obligated to make any such assignment
unless (i) such assignment shall not conflict with any law or any rule,
regulation or order of any Governmental Authority,

 

74

 

(ii) such assignee shall
pay to the non-consenting Lender in immediately available funds on the date of
such assignment the principal of the Loans made by such Lender hereunder and
subject to such assignment and (iii) the applicable Borrower shall pay to the
non-consenting Lender in immediately available funds on the date of such
assignment the interest accrued to the date of payment on the Loans made by
such Lender hereunder and subject to such assignment and all other amounts
accrued for such Lender’s account or owed to it hereunder with respect to such
Loans.

 

SECTION 2.21.  Swingline Loans.  (a)  Subject
to the terms and conditions set forth herein, the Swingline Lender agrees from
time to time during the Revolving Credit Availability Period to make Swingline
Loans to SSCE in an aggregate principal amount at any time outstanding not to
exceed the lesser of (i) U.S.$50,000,000 and (ii) the difference
between (A) the aggregate Revolving Credit Commitments in effect at such
time and (B) the sum of (x) the aggregate principal amount of
Revolving Loans outstanding at such time and (y) the Revolving Facility LC
Exposure at such time.  Each Swingline
Loan shall be in a principal amount that is an integral multiple of U.S.$250,000.  The Swingline Lender shall make each
Swingline Loan available to SSCE by means of a credit to the general deposit
account of SSCE with the Swingline Lender by 3:00 p.m., Standard Time, on
the date such Swingline Loan is requested to be made pursuant to paragraph (b) below.  Within the limits set forth in the first
sentence of this paragraph (a), SSCE may borrow, pay, prepay and
reborrow Swingline Loans.

 

(b)  SSCE
shall give the Administrative Agent telephonic, written or fax notice (in the
case of telephonic notice, such notice to be promptly confirmed by fax) not
later than 11:00 a.m., Standard Time, on the day of a proposed
borrowing.  Such notice shall be
delivered on a Business Day, shall be irrevocable and shall refer to this
Agreement and shall specify the requested date (which shall be a Business Day)
and amount of such Swingline Loan.  The
Administrative Agent shall promptly advise the Swingline Lender of any notice
received from SSCE pursuant to this paragraph (b).

 

(c)  The
Swingline Lender may, by written or fax notice given to the Administrative
Agent not later than 10:00 a.m., Standard Time, on any Business Day,
require the Revolving Lenders to purchase all or any portion of the Swingline
Loans outstanding.  Such notice shall
specify the aggregate amount of Swingline Loan or Swingline Loans to be
purchased, and the Administrative Agent shall promptly upon receipt of such
notice give notice thereof to each Revolving Lender, specifying in such notice
such Revolving Lender’s Applicable Percentage of such Swingline Loan or Swingline
Loans.  Each Revolving Lender shall pay
to the Administrative Agent, in the same manner as provided in Section 2.02(c)
with respect to Loans made by such Lender (and Section 2.02(c)
shall apply, mutatis mutandis, to the payment obligations of the Revolving
Lenders under this paragraph (c)), such Lender’s Applicable Percentage
of the principal amount of such Swingline Loan or Swingline Loans, and the
Administrative Agent shall promptly pay to the Swingline Lender the amounts so
received by it from the Revolving Lenders. 
Each Revolving Lender acknowledges and agrees that its obligations to
make such payment is absolute and unconditional and shall not be affected by
any event or circumstance whatsoever, including the occurrence of any Default
or Event of Default hereunder or the failure of any condition precedent set
forth in Article V to be

 

75

 

satisfied, and that each such
payment shall be made without any offset, abatement, withholding or reduction
whatsoever.  The Administrative Agent
shall promptly advise SSCE of any participations in any Swingline Loan acquired
pursuant to this paragraph (c), and thereafter payments in respect
to such Swingline Loan shall be made to the Administrative Agent and not to the
Swingline Lender.  Any amounts received
by the Swingline Lender from SSCE (or any other party on behalf of SSCE) in
respect of a Swingline Loan after receipt by the Swingline Lender of the
proceeds of a sale of participations therein shall be promptly remitted to the
Administrative Agent; any such amounts received by the Administrative Agent
shall be promptly remitted by the Administrative Agent to the Revolving Lenders
that shall have made their payments pursuant to this paragraph (c) and
to the Swingline Lender, as their interests may appear.  The purchase of participations in a Swingline
Loan pursuant to this paragraph (c) shall not constitute a Loan and
shall not relieve SSCE of its obligation with respect to the payment thereof.

 

SECTION 2.22.  Bankers’ Acceptances.  (a)  Subject
to the terms and conditions of this Agreement, SSC Canada may request a
Revolving (Canadian) Credit Borrowing denominated in Canadian Dollars by
presenting drafts for acceptance and purchase as B/As by the Revolving
(Canadian) Lenders.

 

(b)  No
Contract Period with respect to a B/A to be accepted and, if applicable,
purchased as a Revolving (Canadian) Loan shall extend beyond the Revolving
Credit Maturity Date.  All B/As and B/A
Loans shall be denominated in Canadian Dollars.

 

(c)  To
facilitate availment of B/A Loans, SSC Canada hereby appoints each Revolving
(Canadian) Lender as its attorney to sign and endorse on its behalf (in
accordance with a notice of Borrowing relating to a B/A Loan pursuant to Section 2.03
or 2.10), in handwriting or by facsimile or mechanical signature as and
when deemed necessary by such Revolving (Canadian) Lender, blank forms of B/As
in the form requested by such Revolving (Canadian) Lender.  SSC Canada recognizes and agrees that all
B/As signed and/or endorsed by a Revolving (Canadian) Lender on behalf of SSC
Canada shall bind SSC Canada as fully and effectually as if signed in the
handwriting of and duly issued by the proper signing officers of SSC
Canada.  Each Revolving (Canadian) Lender
is hereby authorized (in accordance with a notice of Borrowing relating to a
B/A Loan) to issue such B/As endorsed in blank in such face amounts as may be
determined by such Revolving (Canadian) Lender; provided that the
aggregate amount thereof is equal to the aggregate amount of B/As required to
be accepted and purchased by such Revolving (Canadian) Lender.  No Revolving (Canadian) Lender shall be
liable for any damage, loss or other claim arising by reason of any loss or improper
use of any such instrument except for the gross negligence or willful
misconduct of such Revolving (Canadian) Lender or its officers, employees,
agents or representatives.  Each
Revolving (Canadian) Lender shall maintain a record, which shall be made
available to SSC Canada upon its request, with respect to B/As
(i) received by it in blank hereunder, (ii) voided by it for any
reason, (iii) accepted and purchased by it hereunder, and
(iv) canceled at their respective maturities.  On request by or on behalf of SSC Canada, a
Revolving (Canadian) Lender shall cancel all forms of B/As which have been
pre-signed

 

76

 

or pre-endorsed on behalf of
SSC Canada and that are held by such Revolving (Canadian) Lender and are not
required to be issued in accordance with SSC Canada’s irrevocable notice.  Alternatively, SSC Canada agrees that, at the
request of the Canadian Administrative Agent, SSC Canada shall deliver to the
Canadian Administrative Agent a “depository note” which complies with the
requirements of the Depository Bills and Notes Act (Canada), and consents to
the deposit of any such depository note in the book-based debt clearance system
maintained by the Canadian Depository for Securities.

 

(d)  Drafts
of SSC Canada to be accepted as B/As hereunder shall be signed as set forth in
this Section 2.22. 
Notwithstanding that any Person whose signature appears on any B/A may
no longer be an authorized signatory for any Revolving (Canadian) Lender or SSC
Canada at the date of issuance of a B/A, such signature shall nevertheless be
valid and sufficient for all purposes as if such authority had remained in
force at the time of such issuance and any such B/A so signed shall be binding
on SSC Canada.

 

(e)  Promptly
following the receipt of a notice of borrowing specifying a Revolving
(Canadian) Credit Borrowing by way of B/A, the Canadian Administrative Agent
shall so advise the Revolving (Canadian) Lenders and shall advise each
Revolving (Canadian) Lender of the aggregate face amount of the B/A to be
accepted by it and the applicable Contract Period (which shall be identical for
all Revolving (Canadian) Lenders).  In
the case of Revolving (Canadian) Loans comprised of B/A Loans, the aggregate
face amount of the B/A to be accepted by a Revolving  (Canadian) Lender shall be in a minimum
aggregate amount of Cdn.$100,000 and shall be a whole multiple of Cdn.$100,000,
and such face amount shall be in the Revolving (Canadian) Lenders’ pro rata portions of such Revolving
(Canadian) Borrowing, provided that the Administrative Agent may in its
sole discretion increase or reduce any Revolving (Canadian) Lender’s portion of
such B/A Loan to the nearest Cdn.$100,000 without reducing the aggregate
Revolving (Canadian) Credit Commitments.

 

(f)  SSC
Canada may specify in a notice of borrowing pursuant to Section 2.03
or 2.10 that it desires that any B/A requested by such notice of
borrowing be purchased by the Revolving (Canadian) Lenders, in which case the
Revolving (Canadian) Lenders shall, upon acceptance of a B/A by a Revolving
(Canadian) Lender, purchase each B/A from SSC Canada at the Discount Rate for
such Revolving (Canadian) Lender applicable to such B/A accepted by it and
provide to the Canadian Administrative Agent the Discount Proceeds for the
account of SSC Canada.  The Acceptance
Fee payable by SSC Canada to a Revolving (Canadian) Lender under Section 2.06(d)
in respect of each B/A accepted by such Revolving (Canadian) Lender shall be
set off against and deducted from the Discount Proceeds payable by such
Revolving (Canadian) Lender under this Section 2.22.

 

(g)  Each
Revolving (Canadian) Lender may at any time and from time to time hold, sell,
rediscount or otherwise dispose of any or all B/As accepted and purchased by
it.

 

77

 

(h)  If
a Revolving (Canadian) Lender is not a chartered bank under the Bank Act
(Canada) or if a Revolving (Canadian) Lender notifies the Canadian
Administrative Agent in writing that it is otherwise unable to accept Bankers’
Acceptances, such Revolving (Canadian) Lender will, instead of accepting and
purchasing Bankers’ Acceptances, make an advance (a “B/A Equivalent Loan”)
to SSC Canada in the amount and for the same term as the draft that such
Revolving (Canadian) Lender would otherwise have been required to accept and
purchase hereunder.  Each such Revolving
(Canadian) Lender will provide to the Canadian Administrative Agent the
Discount Proceeds of such B/A Equivalent Loan for the account of SSC Canada.  Each such B/A Equivalent Loan will bear
interest at the same rate that would result if such Revolving (Canadian) Lender
had accepted (and been paid an Acceptance Fee) and purchased (on a discounted
basis at the Discount Rate) a Bankers’ Acceptance for the relevant Contract
Period (it being the intention of the parties that each such B/A Equivalent
Loan shall have the same economic consequences for the Revolving (Canadian)
Lenders and SSC Canada as the Bankers’ Acceptance which such B/A Equivalent
Loan replaces).  All such interest shall
be paid in advance on the date such B/A Equivalent Loan is made, and will be
deducted from the principal amount of such B/A Equivalent Loan in the same
manner in which the Discount Proceeds of a Bankers’ Acceptance would be
deducted from the face amount of the Bankers’ Acceptance.

 

(i)  SSC
Canada waives presentment for payment and any other defense to payment of any
amounts due to a Revolving (Canadian) Lender in respect of a B/A accepted and
purchased by it pursuant to this Agreement which might exist solely by reason
of such B/A being held, at the maturity thereof, by such Revolving (Canadian)
Lender in its own right, and SSC Canada agrees not to claim any days of grace
if such Revolving (Canadian) Lender, as holder, claims payment from or sues SSC
Canada on the B/A for payment of the amount payable by SSC Canada
thereunder.  On the last day of the
Contract Period of a B/A, or such earlier date as may be required or permitted
pursuant to the provisions of this Agreement, SSC Canada shall pay the
Revolving (Canadian) Lender that has accepted and purchased a B/A or advanced a
B/A Equivalent Loan  the full face amount
of such B/A or B/A Equivalent Loan, as the case may be, and, after such
payment, SSC Canada shall have no further liability in respect of such B/A and such
Revolving (Canadian) Lender shall be entitled to all benefits of, and be
responsible for all payments due to third parties under, such B/A.

 

(j)  Except
as required by any Revolving (Canadian) Lender upon the occurrence of an Event
of Default, no B/A Loan may be repaid by SSC Canada prior to the expiry date of
the Contract Period applicable to such B/A Loan; provided, however,
that any B/A Loan may be defeased as provided in the proviso to Section 2.12(a).

 

SECTION 2.23.  Incremental Commitments.  (a)  Either
Borrower may on one or more occasions, by written notice to the Senior Agents,
request Incremental Term Loan Commitments in an aggregate amount not to exceed
the Incremental Commitment Amount from one or more Incremental Term Lenders,
which may include any existing Lender; provided that each Incremental
Term Lender, if not already a Lender hereunder, shall be subject to the
approval of the Senior Agents (which approval shall not be unreasonably
withheld or delayed).  Such notice shall
set forth (i) the amount of the

 

78

 

Incremental Term Loan
Commitments being requested (which shall be in minimum increments of
U.S.$5,000,000 and a minimum amount of U.S.$20,000,000 or equal to the
remaining Incremental Commitment Amount), (ii) the date on which such
Incremental Term Loan Commitments are requested to become effective (which
shall not be less than 10 Business Days nor more than 60 days after
the date of such notice (which time periods for notice may be modified or
waived at the discretion of the Senior Agents)) and (iii) whether such
Incremental Term Loan Commitments are to be Tranche B Commitments or, in the
case of SSC Canada, Tranche C Commitments, or commitments to make term loans
with pricing terms different from the Tranche B Loans or the Tranche C Loans (“Other
Term Loans”).

 

(b)  SSCE
may on one or more occasions, by written notice to the Senior Agents, request
Incremental Revolving Credit Commitments in an aggregate amount not to exceed
the Incremental Commitment Amount from one or more Incremental Revolving
Lenders, and SSC Canada may, by written notice to the Senior Agents from time
to time, request Incremental Revolving (Canadian) Credit Commitments in an
aggregate amount not to exceed the Incremental Commitment Amount from one or
more Incremental Revolving (Canadian) Lenders, which may, in any case, include
any existing Lender; provided that (i) each Incremental Revolving
Lender shall be subject to the approval of the Senior Agents, the Revolving Facility
Facing Agent and the Swingline Lender, and (ii) each Incremental Revolving
(Canadian) Lender shall be subject to the approval of the Senior Agents and the
Revolving (Canadian) Facility Facing Agent (which approvals shall not be
unreasonably withheld or delayed).  Such
notice shall set forth (x) the amount of the Incremental Revolving Credit
Commitments or Incremental Revolving (Canadian) Credit Commitments being
requested (which shall be in minimum increments of U.S.$5,000,000 and a minimum
amount of U.S.$20,000,000 or equal to the remaining Incremental Commitment
Amount) and (y) the date on which such Incremental Revolving Credit Commitments
or Incremental Revolving (Canadian) Credit Commitments are requested to become
effective (which shall not be less than 10 Business Days nor more than 60
days after the date of such notice (which time periods for notice may be
modified or waived at the discretion of the Senior Agents)).

 

(c)  SSCE
may on one or more occasions, by written notice to the Senior Agents, request
Incremental Deposit Funded Commitments in an aggregate amount not to exceed the
Incremental Commitment Amount from one or more Incremental Deposit Funded
Lenders, which may include any existing Lender; provided that each
Incremental Deposit Funded Lender shall be subject to the approval of the
Senior Agents and the Deposit Funded Facility Facing Agent (which approvals
shall not be unreasonably withheld or delayed). 
Such notice shall set forth (i) the amount of the Incremental Deposit
Funded Commitments being requested (which shall be in minimum increments of
U.S.$5,000,000 and a minimum amount of U.S.$20,000,000 or equal to the
remaining Incremental Commitment Amount) and (ii) the date on which such
Incremental Deposit Funded Commitments are requested to become effective (which
shall not be less than 10 Business Days nor more than 60 days after the
date of such notice (which time periods for notice may be modified or waived at
the discretion of the Senior Agents)).

 

79

 

(d)  The
applicable Borrower and each Incremental Lender shall execute and deliver to
the Administrative Agent an Incremental Term Loan Assumption Agreement,
Incremental Revolving Credit Assumption Agreement or Incremental Deposit Funded
Credit Assumption Agreement, as applicable, and such other documentation as the
Senior Agents shall reasonably specify to evidence the Incremental Commitment
of such Incremental Lender.  Each
Incremental Term Loan Assumption Agreement shall specify the terms of the
Incremental Term Loans to be made thereunder; provided that, without the
prior written consent of Term Lenders holding a majority of the principal
amount of the outstanding Term Loans, (i) the final maturity date of any Other
Term Loans shall be no earlier than the Term Loan Maturity Date, (ii) the
average life to maturity of any Other Term Loans shall be no shorter than the
average life to maturity of the Term Loans and (iii) if the initial yield on
any Other Term Loans (as determined by the Senior Agents to be equal to the sum
of (x) the Adjusted LIBOR margin on the Other Term Loans and (y) if the Other
Term Loans are initially made at a discount or the Lenders making the same
receive a fee directly or indirectly from SSCC or any Subsidiary for doing so
(the amount of such fee, expressed as a percentage of the Other Term Loans,
being referred to herein as “OID”), the amount of such OID divided by
the lesser of (A) the average life to maturity of such Other Term Loans and (B)
four) exceeds by more than 25 basis points (the amount of such excess above 25
basis points being referred to herein as the “Yield Differential”) the
Applicable Rate then in effect for Eurodollar Term Loans, then the Applicable
Rate then in effect for Term Loans shall automatically be increased by the
Yield Differential, effective upon the making of the Other Term Loans; and provided
further that, without the prior written consent of the majority in
interest of the Revolving Lenders and Revolving (Canadian) Lenders, voting as a
single class, the final maturity date of any Other Term Loans shall be no
earlier than the Revolving Credit Maturity Date, and without the prior written
consent of the majority in interest of the Deposit Funded Lenders, the final
maturity date of any Other Term Loans shall be no earlier than the Deposit
Funded Maturity Date.  The Administrative
Agent shall promptly notify each Lender as to the effectiveness of each
Incremental Credit Assumption Agreement. 
Each of the parties hereto hereby agrees that, upon the effectiveness of
any Incremental Credit Assumption Agreement, this Agreement shall be deemed
amended to the extent (but only to the extent) necessary to reflect the
existence and terms of the Incremental Commitment evidenced thereby.  Any such deemed amendment may be memorialized
in writing by the Senior Agents with the Borrowers’ consent (not to be
unreasonably withheld or delayed) and furnished to the other parties hereto.

 

(e)  Notwithstanding
the foregoing, no Incremental Commitment shall become effective under this Section 2.23
unless (i) on the date of such effectiveness, the conditions set forth in paragraphs (b)
and (c) of Section 5.01 shall be satisfied and the
Administrative Agent shall have received a certificate to that effect dated
such date and executed by a Financial Officer of the applicable Borrower and
(ii) the Administrative Agent shall have received legal opinions, board
resolutions and other closing certificates and documentation reasonably
requested by the Senior Agents consistent with those delivered on the Closing
Date pursuant to Section 5.02.

 

80

 

(f)  Each
of the parties hereto hereby agrees that the Administrative Agent may take any
and all action as may be reasonably necessary to ensure that all Incremental
Term Loans (other than Other Term Loans), when originally made, are included in
each Borrowing of outstanding Tranche B Loans or Tranche C Loans, as
the case may be, on a pro rata basis. 
This may be accomplished at the discretion of the Administrative Agent
by requiring each outstanding Eurodollar Tranche B Borrowing or Eurodollar
Tranche C Borrowing, as applicable, to be converted into an ABR Term
Borrowing on the date of each Incremental Term Loan, or by allocating a portion
of each Incremental Term Loan to each outstanding Eurodollar Tranche B
Borrowing or Eurodollar Tranche C Borrowing, as applicable, on a pro rata
basis, even though as a result thereof such Incremental Term Loan may
effectively have a shorter Interest Period than the Term Loans included in the
Borrowing of which they are a part (and notwithstanding any other provision of
this Agreement that would prohibit such an initial Interest Period).  Any conversion of Eurodollar Term Loans to
ABR Term Loans required by the preceding sentence shall be subject to Section 2.15.  If any Incremental Term Loan is to be
allocated to an existing Interest Period for a Eurodollar Term Borrowing then,
subject to Section 2.07, the interest rate applicable to such
Incremental Term Loan for the remainder of such Interest Period shall equal the
Adjusted LIBO Rate for a period approximately equal to the remainder of such
Interest Period (as determined by the Administrative Agent two Business Days
before the date such Incremental Term Loan is made) plus the Applicable
Rate.  In addition, to the extent any
Incremental Term Loans are Tranche B Loans or Tranche C Loans, the
scheduled amortization payments under Section 2.11 required to be
made after the making of such Incremental Term Loans shall be ratably increased
to reflect the aggregate principal amount of such Incremental Term Loans.  In such event, the Administrative Agent shall
prepare and distribute to the Borrowers and the Lenders an updated amortization
schedule, which shall be conclusive absent manifest error.

 

(g)  Each
of the parties hereto hereby agrees that the Administrative Agent may take any
and all actions as may be reasonably necessary to ensure that, after giving
effect to any Incremental Revolving Credit Commitment or Incremental Revolving
(Canadian) Credit Commitment pursuant to this Section 2.23, the
outstanding Revolving Loans and Revolving (Canadian) Loans are held by the
Revolving Lenders and Revolving (Canadian) Lenders, respectively, in accordance
with their new Applicable Percentages. 
This may be accomplished at the discretion of the Administrative Agent
(i) by requiring the outstanding Revolving Loans or Revolving (Canadian)
Loans to be prepaid with the proceeds of a new Revolving Credit Borrowing or
Revolving (Canadian) Credit Borrowing, as the case may be, (ii) by permitting
the Revolving Credit Borrowings and Revolving (Canadian) Credit Borrowings
outstanding at the time of any increase in the aggregate Revolving Credit
Commitments or the aggregate Revolving (Canadian) Credit Commitments pursuant
to this Section 2.23 to remain outstanding until the last days of the
respective Interest Periods therefor, even though the Revolving Lenders or
Revolving (Canadian) Lenders, as the case may be, would hold such Revolving
Credit Borrowings or Revolving (Canadian) Credit Borrowings, as applicable,
other than in accordance with their new Applicable Percentages, or (iii) by any
combination of the foregoing.  Any
prepayment described in this paragraph (g) shall be subject to Section
2.15, but otherwise without premium or penalty.

 

81

 

(h)  Each
of the parties hereto hereby agrees that the Administrative Agent may take any
and all actions as may be reasonably necessary to ensure that, after giving
effect to any Incremental Deposit Funded Commitment pursuant to this Section
2.23, the outstanding Deposit Funded Loans (if any) are held by the Deposit
Funded Lenders in accordance with their new Applicable Percentages.  This may be accomplished at the discretion of
the Administrative Agent by taking any action comparable to the actions
described in paragraph (f) above.

 

ARTICLE III

 

Letters of
Credit

 

SECTION 3.01.  General.  Subject to the terms and conditions set forth
herein, (a) SSCE may request the issuance of Revolving Facility Letters of
Credit, for its own account, by the Revolving Facility Facing Agent, in a form
reasonably acceptable to the Revolving Facility Facing Agent and the
Administrative Agent (it being agreed that the Administrative Agent shall not
unreasonably delay its response as to acceptability of such form (and, in any
event, shall provide such response within two Business Days of receiving the
proposed form) and shall not unreasonably withhold its confirmation as to
acceptability of such form), at any time and from time to time during the
period from the Closing Date to the date that is 30 days prior to the Revolving
Credit Maturity Date, (b) SSC Canada may request the issuance of Revolving
(Canadian) Facility Letters of Credit, for its own account, by the Revolving
(Canadian) Facility Facing Agent, in a form reasonably acceptable to the
Revolving (Canadian) Facility Facing Agent and the Canadian Administrative
Agent (it being agreed that the Canadian Administrative Agent shall not
unreasonably delay its response as to acceptability of such form (and, in any
event, shall provide such response within two Business Days of receiving the
proposed form) and shall not unreasonably withhold its confirmation as to
acceptability of such form), at any time and from time to time during the
period from the Closing Date to the date that is 30 days prior to the Revolving
Credit Maturity Date and (c) SSCE may request the issuance of Deposit Funded
Letters of Credit, for its own account, by the Deposit Funded Facility Facing
Agent, in a form reasonably acceptable to the Deposit Funded Facility Facing
Agent, at any time and from time to time during the period from the Closing
Date to the date that is 30 days prior to the Deposit Funded Maturity
Date.  In the event of any inconsistency
between the terms and conditions of this Agreement and the terms and conditions
of any form of letter of credit application or other agreement submitted by a
Borrower to, or entered into by a Borrower with, the applicable Facing Agent
relating to any Letter of Credit, the terms and conditions of this Agreement
shall control.

 

SECTION 3.02.  Notice of Issuance, Amendment, Renewal,
Extension; Certain Conditions.  To
request the issuance of a Letter of Credit, the applicable Borrower shall hand
deliver or fax (or transmit by electronic communication, if arrangements for
doing so have been approved by the applicable Facing Agent) to the applicable
Facing Agent and the Administrative Agent, reasonably in advance of the

 

82

 

requested date of issuance, a
Letter of Credit Request.  To request any
amendment, renewal or extension of any outstanding Letter of Credit, the
applicable Borrower shall hand deliver or fax (or transmit by electronic
communication, if arrangements for doing so have been approved by the
applicable Facing Agent) to the applicable Facing Agent and the Administrative
Agent, reasonably in advance of the requested date of amendment, renewal or
extension, a notice on the applicable Borrower’s letterhead identifying the
Letter of Credit and the date of the requested amendment, renewal or extension
(which must be a Business Day) and indicating the specifics of such amendment,
renewal or extension.  A Revolving
Facility Letter of Credit shall be issued, amended, renewed or extended only if
(and upon issuance, amendment, renewal or extension of each Revolving Facility
Letter of Credit, SSCE shall be deemed to represent and warrant that) after
giving effect to such issuance, amendment, renewal or extension (a) the
Revolving Facility LC Exposure shall not exceed U.S.$200,000,000 and
(b) the Revolving Credit Utilization shall not exceed the aggregate
Revolving Credit Commitments.  A
Revolving (Canadian) Facility Letter of Credit shall be issued, amended,
renewed or extended only if (and upon issuance, amendment, renewal or extension
of each Revolving (Canadian) Facility Letter of Credit, SSC Canada shall be
deemed to represent and warrant that) after giving effect to such issuance,
amendment, renewal or extension (i) the Revolving (Canadian) Facility LC
Exposure shall not exceed U.S.$50,000,000 and (ii) the Revolving
(Canadian) Credit Utilization shall not exceed the aggregate Revolving
(Canadian) Credit Commitments.  A Deposit
Funded Facility Letter of Credit shall be issued, amended, renewed or extended
only if (and upon issuance, amendment, renewal or extension of each Deposit
Funded Facility Letter of Credit, SSCE shall be deemed to represent and warrant
that), after giving effect to such issuance, amendment, renewal or extension
(A) the Deposit Funded LC Exposure shall not exceed the aggregate Deposits and
(B) the Deposit Funded Utilization shall not exceed the aggregate Deposit
Funded Commitments.  Promptly after the
issuance or amendment of any Letter of Credit, the applicable Facing Agent
shall notify the Administrative Agent 
(and, in the case of any Deposit Funded Facility Letter of Credit, the
Deposit Account Agent) and SSCE or SSC Canada, as the case may be, in writing
of such issuance or amendment and such notice shall be accompanied by a copy of
such issued or amended Letter of Credit. 
Upon receipt of such notice, the Administrative Agent shall promptly
notify each Revolving Lender, Revolving (Canadian) Lender or Deposit Funded
Lender, as applicable, in writing of such issuance or amendment, and if any
Revolving Lender, Revolving (Canadian) Lender or Deposit Funded Lender shall so
request, the Administrative Agent shall provide such Lender with a copy of such
issued or amended Letter of Credit.

 

SECTION 3.03.  Expiration Date.  Each Letter of Credit shall expire at or
prior to the close of business on the earliest of (a) the date one year
after the date of the issuance of such Letter of Credit (or, in the case of any
renewal or extension thereof, one year after such renewal or extension) and
(b) the date that is five Business Days prior to the Revolving Credit
Maturity Date or, in the case of any Deposit Funded Facility Letter of Credit,
five Business Days prior to the Deposit Funded Maturity Date.

 

SECTION 3.04.  Participations.  By the issuance of a Letter of Credit (or an
amendment to a Letter of Credit increasing the amount thereof) and without any

 

83

 

further action on the part of
the applicable Facing Agent or the Lenders, the applicable Facing Agent hereby
grants to each Revolving Lender, Revolving (Canadian) Lender or Deposit Funded
Lender, as the case may be, and each such Lender hereby acquires from the
applicable Facing Agent, a participation in such Letter of Credit equal to such
Lender’s Applicable Percentage of the aggregate amount available to be drawn
under such Letter of Credit, effective upon the issuance of such Letter of
Credit.  In addition, (a) the
Revolving Facility Facing Agent hereby grants to each Revolving Lender, and
each Revolving Lender hereby acquires, a participation in each Existing SSCE
Letter of Credit (other than the Existing IRB Letters of Credit), (b) the
Revolving (Canadian) Facility Facing Agent hereby grants to each Revolving
(Canadian) Lender, and each Revolving (Canadian) Lender hereby acquires, a
participation in each Existing SSC Canada Letter of Credit, and (c) the Deposit
Funded Facility Facing Agent hereby grants to each Deposit Funded Lender, and
each Deposit Funded Lender hereby acquires, a participation in each Existing
IRB Letter of Credit, in each case, equal to such Lender’s Applicable
Percentage of the aggregate amount available to be drawn under such Existing
Letter of Credit, effective as of the Closing Date.  In consideration and in furtherance of the
foregoing, (i) each Revolving Lender and Revolving (Canadian) Lender hereby
absolutely and unconditionally agrees to pay to the Administrative Agent or the
Canadian Administrative Agent, respectively, for the account of the applicable
Facing Agent, such Lender’s Applicable Percentage of each LC Disbursement in
respect of a Revolving Facility Letter of Credit or a Revolving (Canadian)
Facility Letter of Credit, respectively, made by the applicable Facing Agent
and not reimbursed by the applicable Borrower on the date due, or of any
reimbursement payment required to be refunded to the applicable Borrower for
any reason and (ii) each Deposit Funded Lender hereby absolutely and
unconditionally authorizes the Deposit Account Agent to pay to the Deposit
Funded Facility Facing Agent such Lender’s Applicable Percentage of each LC
Disbursement in respect of a Deposit Funded Facility Letter of Credit made by
such Facing Agent and not reimbursed by SSCE on the date due, or of any
reimbursement payment required to be refunded to SSCE for any reason, from the
amounts on deposit in the Deposit Account, in each case, as provided in Section 3.05.  Each Revolving Lender, Revolving (Canadian)
Lender and Deposit Funded Lender acknowledges and agrees that its obligation to
acquire participations pursuant to this Section 3.04 in respect of
Letters of Credit is absolute and unconditional and shall not be affected by
any circumstance whatsoever, including any amendment, renewal or extension of
any Letter of Credit or the occurrence and continuance of a Default or an Event
of Default or reduction or termination of the Revolving Credit Commitments,
Revolving (Canadian) Credit Commitments or Deposit Funded Commitments, as
applicable, and that each such payment shall be made without any offset,
abatement, withholding or reduction whatsoever.

 

SECTION 3.05.  Reimbursement.  (a)  If
the Revolving Facility Facing Agent shall pay any draft or other form of demand
presented under a Revolving Facility Letter of Credit, SSCE shall pay to the
Revolving Facility Facing Agent an amount equal to the amount of such draft or
other form of demand not later than two hours after SSCE shall have received
notice from the Revolving Facility Facing Agent that payment of such draft or
other form of demand will be made or, if SSCE shall have received such notice
later than 10:00 a.m., Standard Time, on any Business Day, not later than
10:00 a.m., Standard Time, on the immediately following Business Day, provided
that

 

84

 

SSCE may, subject to the
conditions to borrowing set forth herein, request in accordance with Section 2.03
or 2.21, as applicable, that such reimbursement payment be financed with
an ABR Revolving Credit Borrowing or a Swingline Loan in an equivalent amount
and, to the extent so financed, the obligations of SSCE in respect of such LC
Disbursement shall be discharged and replaced by the resulting ABR Revolving
Credit Borrowing or Swingline Loan.  If
SSCE fails to make such reimbursement payment when due and such reimbursement
payment is not financed with an ABR Revolving Credit Borrowing or a Swingline
Loan as contemplated by the immediately preceding sentence, the Revolving
Facility Facing Agent shall promptly notify the Administrative Agent, which
shall in turn notify each Revolving Lender of such LC Disbursement, the
reimbursement payment then due from SSCE in respect thereof and such Lender’s
Applicable Percentage thereof.  Promptly
following receipt of such notice, each Revolving Lender shall pay to the
Administrative Agent an amount equal to such Lender’s Applicable Percentage of
the reimbursement payment then due from SSCE, in the same manner as provided in
Section 2.02(c) with respect to Loans made by such Lender (and Section
2.02(c) shall apply, mutatis mutandis, to the payment obligations of the
Revolving Lenders under this paragraph (a)), and the Administrative
Agent shall promptly pay to the Revolving Facility Facing Agent the amounts so
received by it from the Revolving Lenders (it being understood and agreed that
(i) if the conditions precedent to borrowing set forth herein have been met,
then any such amount paid by any Revolving Lender shall be deemed to constitute
an ABR Revolving Loan of such Lender and, to the extent of such payment, the
obligations of SSCE in respect of such LC Disbursement shall be discharged and
replaced by the resulting ABR Revolving Credit Borrowing and (ii) if such conditions
precedent to borrowing have not been met, then any such amount paid by any
Revolving Lender shall not constitute a Loan and shall not relieve SSCE of its
obligation to reimburse such LC Disbursement). 
The Revolving Facility Facing Agent will promptly notify the
Administrative Agent of any amount subsequently received by it from SSCE or
another Loan Party in respect of such LC Disbursement and, in the event that
Revolving Lenders have made payments pursuant to this paragraph (a),
shall promptly remit to the Administrative Agent any such amount, and the
Administrative Agent shall distribute such amount to the Revolving Lenders and
the Revolving Facility Facing Agent as their interests may appear.

 

(b)  If
the Revolving (Canadian) Facility Facing Agent shall pay any draft or other
form of demand presented under a Revolving (Canadian) Facility Letter of
Credit, SSC Canada shall pay to the Revolving (Canadian) Facility Facing Agent
an amount equal to the amount of such draft or other form of demand not later
than two hours after SSC Canada shall have received notice from the Revolving
(Canadian) Facility Facing Agent that payment of such draft or other form of
demand will be made or, if SSC Canada shall have received such notice later
than 10:00 a.m., Standard Time, on any Business Day, not later than
10:00 a.m., Standard Time, on the immediately following Business Day, provided
that SSC Canada may, subject to the conditions to borrowing set forth herein,
request in accordance with Section 2.03 that such reimbursement
payment be financed with an ABR Revolving (Canadian) Credit Borrowing or, if
such LC Disbursement is denominated in Canadian Dollars, a Canadian Prime Rate
Borrowing in an equivalent amount and, to the extent so financed, the
obligations of SSC Canada in respect of such LC Disbursement shall be
discharged and

 

85

 

replaced by the resulting ABR
Revolving (Canadian) Credit Borrowing or Canadian Prime Rate Borrowing, as the
case may be.  If SSC Canada fails to make
such reimbursement payment when due and such reimbursement payment is not
financed with a Borrowing as contemplated by the immediately preceding
sentence, the Revolving (Canadian) Facility Facing Agent shall notify the
Canadian Administrative Agent, which shall in turn notify each Revolving
(Canadian) Lender of such LC Disbursement, the reimbursement payment then due
from SSC Canada in respect thereof and such Lender’s Applicable Percentage
thereof.  Promptly following receipt of
such notice, each Revolving (Canadian) Lender shall pay to the Canadian
Administrative Agent an amount equal to such Lender’s Applicable Percentage of
the reimbursement payment then due from SSC Canada, in the same manner as
provided in Section 2.02(c) with respect to Loans made by such
Lender (and Section 2.02(c) shall apply, mutatis mutandis, to the
payment obligations of the Revolving (Canadian) Lenders under this paragraph
(b)), and the Canadian Administrative Agent shall promptly pay to the
Revolving (Canadian) Facility Facing Agent the amounts so received by it from
the Revolving (Canadian) Lenders (it being understood and agreed that (i) if
the conditions precedent to borrowing set forth herein have been met, then any
such amount paid by any Revolving (Canadian) Lender shall be deemed to
constitute an ABR Revolving (Canadian) Loan or, if such LC Disbursement is
denominated in Canadian Dollars, a Canadian Prime Rate Loan of such Lender and,
to the extent of such payment, the obligations of SSC Canada in respect of such
LC Disbursement shall be discharged and replaced by the resulting ABR Revolving
(Canadian) Credit Borrowing or Canadian Prime Rate Borrowing, as the case may
be, and (ii) if such conditions precedent to borrowing have not been met, then
any such amount paid by any Revolving (Canadian) Lender shall not constitute a
Loan and shall not relieve SSC Canada of its obligation to reimburse such LC
Disbursement).  The Revolving (Canadian)
Facility Facing Agent will promptly notify the Canadian Administrative Agent of
any amount subsequently received by it from SSC Canada or another Loan Party in
respect of such LC Disbursement and, in the event that Revolving (Canadian)
Lenders have made payments pursuant to this paragraph (b), shall
promptly remit to the Canadian Administrative Agent any such amount, and the
Canadian Administrative Agent shall distribute such amount to the Revolving
(Canadian) Lenders and the Revolving (Canadian) Facility Facing Agent as their
interests may appear.

 

(c)  If
the Deposit Funded Facility Facing Agent shall pay any draft or other form of
demand presented under a Deposit Funded Facility Letter of Credit, SSCE shall
pay to the Deposit Funded Facility Facing Agent an amount equal to the amount
of such draft or other form of demand not later than two hours after SSCE shall
have received notice from the Deposit Funded Facility Facing Agent that payment
of such draft or other form of demand will be made or, if SSCE shall have
received such notice later than 10:00 a.m., Standard Time, on any Business
Day, not later than 10:00 a.m., Standard Time, on the immediately
following Business Day.  If the Deposit
Funded Facility Facing Agent has not received from SSCE such reimbursement
payment when due, the Deposit Funded Facility Facing Agent will promptly notify
the Administrative Agent and the Deposit Account Agent of such LC Disbursement,
and the Administrative Agent shall in turn notify each Deposit Funded Lender of
such LC Disbursement, the reimbursement payment then due from SSCE in respect
thereof and such Lender’s Applicable Percentage thereof.  Each Deposit Funded Lender hereby authorizes
the

 

86

 

Deposit Account Agent, and the
Deposit Account Agent hereby agrees, to withdraw from the Deposit Account the
amount of such reimbursement payment and to make such amount available to the
Deposit Funded Facility Facing Agent (it being understood and agreed that (i)
if the conditions precedent to borrowing set forth herein have been met, then
such Lender’s Applicable Percentage of such amount shall be deemed to
constitute its Deposit Funded Loan and the obligations of SSCE with respect to
such LC Disbursement shall be discharged and replaced by the resulting Deposit
Funded Borrowing and (ii) if such conditions precedent have not been met, then
such amount shall not constitute a Loan and shall not relieve SSCE of its
obligation to reimburse such LC Disbursement). 
The Deposit Funded Facility Facing Agent will promptly notify the
Administrative Agent and the Deposit Account Agent of any amount subsequently
received by it from SSCE in respect of such LC Disbursement and shall promptly
remit to the Deposit Account Agent any such amount, which shall in turn deposit
such amount into the Deposit Account. 
Thereafter, any such amounts deposited to the Deposit Account shall be
available to reimburse the Deposit Funded Facility Facing Agent in accordance
with the second preceding sentence of this paragraph (c).   Notwithstanding anything herein to the
contrary, the funding obligation of each Deposit Funded Lender in respect of
its participations of Deposit Funded Facility Letters of Credit shall be
satisfied in full upon the funding of an amount equal to its Deposit Funded
Commitment into the Deposit Account.

 

SECTION 3.06.  Obligations Absolute.  Each Borrower’s obligation to repay the
applicable Facing Agent for LC Disbursements made by the applicable Facing
Agent under the outstanding Letters of Credit for the account of the applicable
Borrower shall be absolute, unconditional and irrevocable under any and all
circumstances and irrespective of:

 

(a)  any lack of validity or enforceability of any
Letter of Credit;

 

(b)  the existence of any claim, setoff, defense
or other right that the applicable Borrower or any other Person may at any time
have against the beneficiary or transferee under any Letter of Credit, any
Facing Agent, the Administrative Agent, any Lender or any other Person (other
than the defense of payment in accordance with the terms of this Agreement or a
defense based on the gross negligence or willful misconduct of the applicable
Facing Agent) in connection with this Agreement or any other agreement or
transaction;

 

(c)  any draft or other document presented under a
Letter of Credit proving to be forged, fraudulent, invalid or insufficient in
any respect or any statement therein being untrue or inaccurate in any respect,
provided that payment by the applicable Facing Agent under such Letter
of Credit against presentation of such draft or document shall not have
constituted gross negligence or willful misconduct of the applicable Facing
Agent;

 

(d)  payment by the applicable Facing Agent under
a Letter of Credit against presentation of a draft or other document that does
not comply with the terms of such Letter of Credit, provided that such
payment shall not have

 

87

 

constituted
gross negligence or willful misconduct of the applicable Facing Agent; and

 

(e)  any other circumstance or event whatsoever,
whether or not similar to any of the foregoing, provided that such
circumstance or event shall not have been the result of gross negligence or
willful misconduct of the applicable Facing Agent.

 

It is understood that in making any payment
under a Letter of Credit (i) the applicable Facing Agent’s exclusive
reliance on the documents presented to it under such Letter of Credit as to any
and all matters set forth therein, including reliance on the amount of any
draft presented under such Letter of Credit, whether or not the amount due to
the beneficiary equals the amount of such draft and whether or not any document
presented pursuant to such Letter of Credit proves to be insufficient in any
respect, if such document on its face appears to be in order, and whether or not
any other statement or any other document presented pursuant to such Letter of
Credit proves to be forged or invalid or any statement therein proves to be
inaccurate or untrue in any respect whatsoever, and (ii) any noncompliance
in any immaterial respect of the documents presented under a Letter of Credit
with the terms thereof shall not, in each case, be deemed willful misconduct or
gross negligence of the applicable Facing Agent.

 

SECTION 3.07.  Disbursement Procedures.  The applicable Facing Agent shall, promptly
following its receipt thereof, examine all documents purporting to represent a
demand for payment under a Letter of Credit. 
The applicable Facing Agent shall promptly notify (a) the Administrative
Agent in the case of Revolving Facility Letters of Credit, (b) the Canadian
Administrative Agent in the case of Revolving (Canadian) Facility Letters of
Credit and (c) the Administrative Agent and the Deposit Account Agent in the
case of Deposit Funded Facility Letters of Credit and, in each case, the applicable
Borrower by telephone (confirmed by fax) of such demand for payment and whether
such Facing Agent has made or will make a LC Disbursement thereunder, provided
that any failure to give or delay in giving such notice shall not relieve the
applicable Borrower of its obligation to reimburse the applicable Facing Agent
and the Revolving Lenders, Revolving (Canadian) Lenders or Deposit Funded
Lenders, as the case may be, with respect to any such LC Disbursement.

 

SECTION 3.08.  Interim Interest.  If a Facing Agent shall make any LC
Disbursement, then, unless the applicable Borrower shall reimburse such LC
Disbursement in full on the date such LC Disbursement is made, the unpaid
amount thereof shall bear interest, for each day from and including the date
such LC Disbursement is made to but excluding the date that the applicable
Borrower reimburses such LC Disbursement, at (a) in the case of LC
Disbursements (other than LC Disbursements in respect of any Deposit Funded
Facility Letter of Credit) denominated in U.S. Dollars, the rate per annum then
applicable to ABR Revolving Loans, (b) in the case of LC Disbursements
denominated in Canadian Dollars, the rate per annum then applicable to Canadian
Prime Rate Loans, and (c) in the case of LC Disbursements in respect of any
Deposit Funded Facility Letter of Credit, the rate per annum then applicable to
ABR Tranche B Loans; provided that, if the applicable Borrower fails to

 

88

 

reimburse such LC Disbursement
when due pursuant to Section 3.05, then Section 2.07 shall
apply.  Interest accrued pursuant to this
Section 3.08 shall be for the account of the applicable Facing Agent,
except that interest accrued on and after the date of payment by any Revolving
Lender, Revolving (Canadian) Lender or Deposit Funded Lender, as the case may
be, pursuant to Section 3.05 to reimburse the applicable Facing
Agent shall be for the account of such Lender to the extent of such payment.

 

SECTION 3.09.  Cash Collateralization.  If any Event of Default shall occur and be
continuing, on the Business Day that the Borrowers receive notice from the
Administrative Agent or the Required Lenders (or, if the maturity of the Loans
has been accelerated, Lenders with LC Exposure representing greater than 50% of
the total LC Exposure) demanding the deposit of cash collateral pursuant to
this Section 3.09, (a) SSCE shall deposit (i) in an account with
the Administrative Agent, in the name of the Administrative Agent and for the
benefit of the Revolving Lenders, an amount in cash equal to the Revolving
Facility LC Exposure as of such date plus any accrued and unpaid fees
and interest thereon and (ii) in an account with the Deposit Account Agent, in
the name of the Deposit Account Agent and for the benefit of the Deposit Funded
Lenders, an amount in cash equal to the Deposit Funded Facility LC Exposure as
of such date plus any accrued and unpaid fees and interest thereon, and
(b) SSC Canada shall deposit in an account with the Canadian
Administrative Agent, in the name of the Canadian Administrative Agent and for
the benefit of the Revolving (Canadian) Lenders, an amount in cash equal to the
Revolving (Canadian) Facility LC Exposure as of such date plus any
accrued and unpaid fees and interest thereon; provided that the
obligation to deposit such cash collateral shall become effective immediately,
and such deposit shall become immediately due and payable, without demand or
other notice of any kind, upon the occurrence of any Event of Default with
respect to SSCC or either Borrower described in paragraph (g) or (h)
of Article VIII.  Each such
deposit shall be held by the Administrative Agent, the Canadian Administrative
Agent or the Deposit Account Agent, as applicable, as collateral for the
payment and performance of the obligations of the Borrowers under this
Agreement.  The Administrative Agent,
Canadian Administrative Agent and the Deposit Account Agent, as applicable,
shall have exclusive dominion and control, including the exclusive right of
withdrawal, over such accounts.  Other
than any interest earned on the investment of such deposits, which investments
shall be made at the option and sole discretion of the Administrative Agent,
the Canadian Administrative Agent or the Deposit Account Agent, as applicable,
and at the Borrowers’ risk and expense, such deposits shall not bear
interest.  Interest or profits, if any,
on such investments shall accumulate in such account.  Moneys in such account shall be applied by
the Administrative Agent, the Canadian Administrative Agent or the Deposit
Account Agent, as applicable, to reimburse the applicable Facing Agent for LC
Disbursements for which it has not been reimbursed and, to the extent not so
applied, shall be held for the satisfaction of the reimbursement obligations of
SSCE for the Revolving Facility LC Exposure or for the Deposit Funded LC
Exposure, as applicable, and the reimbursement obligations of SSC Canada for
the Revolving (Canadian) Facility LC Exposures at such time or, if the maturity
of the Loans has been accelerated (but subject to the consent of Lenders with
LC Exposure representing greater than 50% of the total LC Exposure), be applied
to satisfy other obligations of the Borrowers under this Agreement.  If the Borrowers are required to provide an amount
of cash collateral hereunder as a result of

 

89

 

the occurrence of an Event of
Default, such amount (to the extent not applied as aforesaid) shall be returned
to the applicable Borrower within three Business Days after all Events of
Default have been cured or waived.

 

SECTION 3.10.  Replacement of a Facing Agent.  A Facing Agent may be replaced at any time by
written agreement among the Borrowers, the Senior Agents, the Administrative
Agent, the replaced Facing Agent and the successor Facing Agent.  Any such successor Revolving (Canadian)
Facility Facing Agent shall not be a non-resident of Canada or shall be deemed
to be resident in Canada for purposes of Part XIII of the ITA in respect of the
Revolving (Canadian) Facility Letters of Credit to be issued by it.  The Administrative Agent shall notify the
Lenders of any such replacement of a Facing Agent.  At the time any such replacement shall become
effective, the Borrowers shall pay all unpaid fees accrued for the account of
the replaced Facing Agent pursuant to Sections 2.05(b), (c)
and (d).  From and after the
effective date of any such replacement, (a) the successor Facing Agent
shall have all the rights and obligations of a Facing Agent under this Agreement
with respect to Letters of Credit to be issued thereafter and
(b) references herein to the term “Facing Agent” and to the term “Revolving
Facility Facing Agent”, “Revolving (Canadian) Facility Facing Agent” or “Deposit
Funded Facility Facing Agent,” as applicable, shall be deemed to refer to such
successor or to any previous Facing Agent, or to such successor and all
previous Facing Agents, as the context shall require.  After the replacement of a Facing Agent hereunder,
the replaced Facing Agent shall remain a party hereto and shall continue to
have all the rights and obligations of a Facing Agent under this Agreement with
respect to Letters of Credit issued by it prior to such replacement, but shall
not be required to issue additional Letters of Credit.

 

SECTION 3.11.  Additional Facing Agents.  The Borrowers may, at any time and from time
to time with the consent of the Senior Agents (which consent shall not be
unreasonably withheld) and such Lender, designate one or more additional
Lenders to act as a Revolving Facility Facing Agent or a Revolving (Canadian)
Facility Facing Agent under the terms of this Agreement.  Any Lender designated as a Revolving Facility
Facing Agent or a Revolving (Canadian) Facility Facing Agent pursuant to this Section 3.11
shall, in addition to being a Lender, be deemed to be the “Revolving Facility
Facing Agent” or “Revolving (Canadian) Facility Facing Agent”, as the case may
be, in respect of Letters of Credit issued or to be issued by such Lender, and,
with respect to such Letters of Credit, such term shall thereafter apply to any
other Revolving Facility Facing Agent or Revolving (Canadian) Facility Facing
Agent, as applicable, and such Lender.

 

SECTION 3.12.  Existing Letters of Credit.  The Borrowers, the Facing Agents and the
Lenders acknowledge the issuance of the Existing Letters of Credit and agree
that such Existing Letters of Credit shall constitute Letters of Credit
pursuant to the terms and conditions of this Agreement and the other Loan
Documents.

 

90

 

ARTICLE IV

 

Representations
and Warranties

 

Each of SSCC and the Borrowers represents and
warrants to each of the Lenders, the Agents and the Facing Agents that:

 

SECTION 4.01.  Organization; Powers.  Each of the Loan Parties (a) is duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its organization, (b) has all requisite power and
authority to own its property and assets and to carry on its business as now
conducted, (c) is qualified to do business in every jurisdiction where
such qualification is required by the nature of its business, the character and
location of its property, business or customers, or the ownership or leasing of
its properties, except for such jurisdictions in which the failure so to
qualify, in the aggregate, could not reasonably be expected to result in a
Material Adverse Effect, and (d) has the requisite power and authority to
execute, deliver and perform its obligations under each of the Loan Documents
and each other agreement or instrument contemplated thereby to which it is or
will be a party and, in the case of the Borrowers, to borrow hereunder.

 

SECTION 4.02.  Authorization.  The execution, delivery and performance by
the parties party thereto of the Merger Agreement and the transactions
contemplated thereby (collectively, the “Merger Transactions”) and by
each of the Loan Parties of each of the Loan Documents to which it is a party,
the Borrowings hereunder, the issuance of the Letters of Credit, the use of the
proceeds of the Loans and the Letters of Credit, the creation of the security
interests contemplated by the Security Documents and the other transactions
contemplated by the Loan Documents (other than the Merger Transactions)
(collectively, the “Credit Transactions” and, together with the Merger
Transactions, the “Transactions”) (a) have been duly authorized by
all requisite corporate and, if required, stockholder action and (b) will
not (i) violate (A) any provision of law, statute, rule or regulation,
other than any law, statute, rule or regulation the violation of which could
not reasonably be expected to result in a Material Adverse Effect, or of the
certificate of incorporation or other constitutive documents or by-laws
of any Loan Party or any of its subsidiaries, (B) any order of any
Governmental Authority or (C) any provision of any indenture or other
material agreement or other material instrument to which any Loan Party or any
of its subsidiaries is a party or by which any of them or any of their property
is or may be bound, except, with respect to the Merger Transactions, where such
violations could not reasonably be expected to have a Material Adverse Effect,
(ii) constitute (alone or with notice or lapse of time or both) a default
under any such indenture, agreement or other instrument, except, with respect
to the Merger Transactions, where such defaults could not reasonably be
expected to have a Material Adverse Effect, or (iii) result in the
creation or imposition of any Lien (other than any Lien created hereunder or
under the Security Documents) upon or with respect to any property or assets
now owned or hereafter acquired by any Loan Party or any of its subsidiaries.

 

91

 

SECTION 4.03.  Enforceability.  This Agreement has been duly executed and
delivered by SSCC and each Borrower and constitutes, and each other Loan
Document when executed and delivered by each Loan Party that is party thereto
will constitute, a legal, valid and binding obligation of SSCC, each Borrower
and the other Loan Parties, as applicable, enforceable against each of them in
accordance with its terms (except as the enforceability thereof may be limited
by bankruptcy, insolvency reorganization, moratorium or similar laws affecting
the enforcement of creditors’ rights generally and subject to general
principles of equity (whether enforcement is sought by proceeding in equity or
at law)).

 

SECTION 4.04.  Governmental Approvals.  No action, consent or approval of, registration
or filing with or any other action by any Governmental Authority is or will be
required in connection with the Transactions, except for (a) the filing of
Uniform Commercial Code financing statements and similar security or collateral
filings and registrations under applicable laws in other jurisdictions,
(b) recordation of the Mortgages, (c) filings with the United States
Patent and Trademark Office, the United States Copyright Office and the
Canadian Intellectual Property Office, and registrations with the Registers of
Personal and Movable Real Rights of the Province of Quebec and with Land
Registers for various Land Registration Divisions of the Province of Quebec,
(d) such actions, consents, approvals, registrations and filings as have
been made or obtained and are in full force and effect, and (e) with
respect to the Merger Transactions, actions, consents, approvals,
registrations, filings or other actions the failure to obtain which could not
reasonably be expected to have a Material Adverse Effect.

 

SECTION 4.05.  Financial Statements.  Each of SSCC, SSCE and SSC Canada has
delivered to the Lenders (a) its audited financial statements for the
fiscal year ended December 31, 2003, together with its annual report on
Form 10-K, if any, filed with the Securities and Exchange Commission with
respect to such fiscal year, and (b) its unaudited financial statements
for the fiscal quarter ended June 30, 2004, together with its quarterly report
on Form 10-Q, if any, filed with the Securities and Exchange Commission
with respect to such fiscal quarter.  All
financial statements set forth or referred to in the materials specified in the
preceding sentence were prepared in conformity with U.S. GAAP or Canadian GAAP,
as applicable, except, in the case of unaudited financial statements, for the
absence of footnote disclosure and for year-end audit adjustments.  All such financial statements fairly present
in all material respects the consolidated financial position of such Persons
and their respective subsidiaries as at the date thereof and the consolidated
results of operations and cash flows of such Persons and their respective
subsidiaries for each of the periods covered thereby.  Except as disclosed in such financial
statements, neither SSCC nor any of the Subsidiaries had at the date of such
financial statements any material contingent obligation, material contingent
liability or material liability for taxes, long-term lease or unusual forward
or long-term commitment or obligations to retired employees for medical or
other employee benefits that is not reflected in the foregoing financial
statements or the notes thereto.

 

SECTION 4.06.  No Material Adverse Effect.  Since December 31, 2003, there has been no
event or condition that has had, or could reasonably be expected to have, a
Material Adverse Effect.

 

92

 

SECTION 4.07.  Title to Properties; Possession Under
Leases.  (a)  Except as set forth on Schedule 4.07,
each of SSCC and the Subsidiaries has good and marketable title to, or valid
leasehold interests in, all its material properties and assets, except for
minor defects in title that do not interfere in any material respect with its
ability to conduct its business as currently conducted.  All such title to, or leasehold interest in,
material properties and assets are free and clear of Liens, other than Liens
expressly permitted by Section 7.02 and Liens with respect to which
the Collateral Agent has received on or prior to the Closing Date duly executed
releases and termination statements in connection therewith.

 

(b)  Each
of SSCC and the Subsidiaries has complied with all obligations under all leases
to which it is a party and enjoys peaceful and undisturbed possession under all
such leases, except where the failure thereof could not reasonably be expected
to have a Material Adverse Effect.

 

SECTION 4.08.  Subsidiaries.  Schedule 4.08 sets forth as of
the Closing Date a list of all the Subsidiaries of SSCC, their jurisdiction of
organization and the percentage ownership interest in each Subsidiary held by
SSCC or any other Subsidiary.

 

SECTION 4.09.  Litigation; Compliance with Laws.  (a)  Except
as set forth in Schedule 4.09, there are no actions, suits or
proceedings at law or in equity or by or before any Governmental Authority now
pending or, to the knowledge of SSCC or either Borrower, threatened against or
affecting SSCC or any of the Subsidiaries or any business or property of any
such Person that (i) purports to affect the legality, validity or enforceability
of any Loan Document or the Transactions or (ii) could reasonably be
expected, individually or in the aggregate, to result in a Material Adverse
Effect.

 

(b)  Neither
SSCC nor any of the Subsidiaries nor any of their respective properties or
assets is (i) in violation of, nor will the continued operation of their
properties and assets as currently conducted violate, any law, rule,
regulation, statute (including any zoning, building, Environmental Laws,
ordinance, code or approval or any building permits) or any restrictions of
record or agreements affecting the Mortgaged Properties, where such violations
could reasonably be expected to have a Material Adverse Effect or (ii) in
default with respect to any judgment, writ, injunction, decree or order of any
Governmental Authority, where such defaults, individually or in the aggregate,
could reasonably be expected to result in a Material Adverse Effect.

 

SECTION 4.10.  Federal Reserve Regulations.  (a)  Neither
SSCC nor any of the Subsidiaries is engaged principally, or as one of its
important activities, in the business of extending credit for the purpose of
purchasing or carrying Margin Stock.

 

(b)  No
part of the proceeds of any Letter of Credit Loan has been used, whether
directly or indirectly, and whether immediately, incidentally or ultimately,
(i) to purchase or carry Margin Stock or to extend credit to others for
the purpose of purchasing or carrying Margin Stock or to refund indebtedness
originally incurred for such purpose or (ii) for any purpose that entails
a violation of, or is inconsistent with, the provisions of the Regulations of
the Board, including Regulation T, U or X.

 

93

 

SECTION 4.11.  Investment Company Act; Public Utility
Holding Company Act.  Neither SSCC
nor any of the Subsidiaries (a) is an “investment company” as defined in,
or is subject to regulation under, the Investment Company Act of 1940 or
(b) is a “holding company” as defined in, or is subject to regulation
under, the Public Utility Holding Company Act of 1935.

 

SECTION 4.12.  Tax Returns.  Each of SSCC and the Subsidiaries has filed
or caused to be filed all Federal, foreign, state, provincial, regional and
local income and other material tax returns required to have been filed by it
or with respect to it and has paid or caused to be paid all taxes shown to be
due and payable on such returns or on any assessments received by it or with
respect to it, except taxes that are being contested in good faith by
appropriate proceedings and for which it has set aside on its books adequate
reserves in accordance with U.S. GAAP or Canadian GAAP, as applicable.

 

SECTION 4.13.  No Material Misstatements.  The information provided by or on behalf of
SSCC and the Borrowers and contained in the Confidential Information Memorandum
(including all attachments and exhibits thereto), as supplemented, and other
information furnished in writing by or on behalf of SSCC or the Borrowers to
any Agent or any Lenders in connection with the transactions contemplated by
this Agreement and the other Loan Documents, when taken as a whole, as of the
date such information was so furnished, does not contain any untrue statement
of a material fact or omit to state any material fact necessary to make the
statements therein, in light of the circumstances under which they were made,
when taken as a whole, not materially misleading, provided that to the
extent any such information therein was based upon or constitutes a forecast or
projection or pro forma financial information, each of SSCC and the Borrowers
represents only that it acted in good faith and utilized reasonable
assumptions, due and careful consideration and the information actually known
to Responsible Officers of such Person at the time in the preparation of such
information.

 

SECTION 4.14.  Employee Benefit Plans.  (a)  Each
of SSCC and its ERISA Affiliates is in compliance in all material respects with
the applicable provisions of ERISA and the Code and the regulations and
published interpretations thereunder.  No
ERISA Event has occurred or could reasonably be expected to occur that, when
taken together with all other ERISA Events that have occurred or could
reasonably be expected to occur, could reasonably be expected to have a
Material Adverse Effect.  The present
value of all benefit liabilities of all underfunded Plans (based on those
assumptions used to fund each such Plan) did not, as of the last annual
valuation dates applicable thereto, exceed the value of the assets of the Plans
by an amount that could reasonably be expected to result in a Material Adverse
Effect.

 

(b)  The
Canadian Pension Plans are duly registered under the ITA and any other
applicable laws which require registration, have been administered in all
material respects in accordance with the ITA and such other applicable laws,
and no event has occurred which could reasonably be expected to cause the loss
of such registered status.  All material
obligations of SSC Canada and the other Canadian Subsidiaries required to be
performed by SSC Canada or the other Canadian Subsidiaries in connection with
the Canadian Pension Plans and the funding agreements therefor have

 

94

 

been performed on a timely basis.  As of the Closing Date, there are no
outstanding disputes concerning the assets of the Canadian Pension Plans or the
Canadian Benefit Plans.  No promises of
benefit improvements under the Canadian Pension Plans or the Canadian Benefit
Plans have been made, except where such improvement could not reasonably be
expected to have a Material Adverse Effect. 
All contributions or premiums required to be made or paid by SSC Canada
and each of its Subsidiaries to the Canadian Pension Plans or the Canadian
Benefit Plans have been made on a timely basis in accordance with the terms of
such plans and all applicable laws. 
There have been no improper withdrawals or applications of the assets of
the Canadian Pension Plans or the Canadian Benefit Plans.  None of the Canadian Pension Plans or the
Canadian Benefit Plans has any unfunded actuarial liabilities or solvency
deficiencies (within the meaning of the Quebec Supplemental Pension Plans Act
and other applicable laws) in an aggregate amount that could reasonably be
expected to result in a Material Adverse Effect.

 

SECTION 4.15.  Environmental and Safety Matters.  Except as set forth on Schedule 4.15:

 

(a)  Each of SSCC and the Subsidiaries has
obtained all permits, licenses and other authorizations that are required and
material with respect to the operation of the business of SSCC and the
Subsidiaries, taken as a whole, under any Environmental Law, and each such
permit, license and authorization is in full force and effect, except where the
failure thereof could not reasonably be expected to have a Material Adverse
Effect.

 

(b)  Each of SSCC and the Subsidiaries is in
compliance with all material terms and conditions of the permits, licenses and
authorizations specified in paragraph (a) above, and is also in
compliance with all other limitations, restrictions, conditions, standards,
prohibitions, requirements, obligations, schedules and timetables contained in
any Environmental Law applicable to it and its business, assets, operations and
properties, except for any noncompliance that could not reasonably be expected
to have a Material Adverse Effect.

 

(c)  There is no civil, criminal or administrative
action, suit, demand, claim, hearing, notice of violation, investigation,
proceeding, notice or demand letter or request for information pending or, to
the knowledge of SSCC or either Borrower, after inquiry, threatened against
either Borrower or any of the Subsidiaries under any Environmental Law that
could reasonably be expected to result have a Material Adverse Effect.

 

(d)  Neither SSCC nor any of the Subsidiaries has
received notice that it has been identified as a potentially responsible party
under the Comprehensive Environmental Response, Compensation and Liability Act
of 1980, as amended (“CERCLA”) or any comparable state law or Canadian
federal or provincial law or that any hazardous substances or any pollutant or
contaminant, as defined in CERCLA and its implementing regulations, or any
toxic substance, hazardous waste, hazardous constituents, hazardous materials,
asbestos or asbestos containing material, polychlorinated biphenyls, petroleum,
including crude oil and any fractions thereof, or

 

95

 

other wastes, chemicals, substances or
materials regulated by any Environmental Laws (collectively, “Hazardous
Materials”) that it or any of their respective predecessors in interest has
used, generated, stored, tested, handled, transported or disposed of, has been
found at any site at which any Governmental Authority or private party is
conducting a remedial investigation or other action pursuant to any
Environmental Law, except for any such notices that could not reasonably be
expected to have a Material Adverse Effect.

 

(e)  There have been no releases or threatened
releases of Hazardous Materials by SSCC or any of the Subsidiaries on, upon,
into or from any of the Real Properties, which releases or threatened releases
could reasonably be expected to have a Material Adverse Effect.  To the best knowledge of SSCC and each
Borrower, there have been no such releases or threatened releases on, upon,
under or into any real property in the vicinity of any of the Real Properties
that, through soil, surface water or groundwater migration or contamination,
may be located on, in or under such Real Properties and which could reasonably
be expected to have a Material Adverse Effect.

 

(f)  To the best knowledge of SSCC and each
Borrower, there is no asbestos in, on, or at any Real Properties or any facility
or equipment of SSCC or any of the Subsidiaries, except to the extent that the
presence of, or exposure to, such material could not reasonably be expected to
have a Material Adverse Effect.

 

(g)  As of the Closing Date, to the knowledge of
SSCC and each Borrower, none of the Real Properties are (i) listed or
proposed for listing on the National Priorities List under CERCLA or
(ii) listed in the Comprehensive Environmental Response, Compensation,
Liability Information System List promulgated pursuant to CERCLA.

 

(h)  To the knowledge of SSCC and each Borrower,
there are no events, conditions, circumstances, activities, practices,
incidents, actions or plans that could reasonably be anticipated to interfere
with or prevent compliance with any Environmental Law, or which may give rise
to liability under any Environmental Law, or otherwise form the basis of any
claim, action, demand, suit, proceeding, hearing or notice of violation, study
or investigation, based on or related to the manufacture, processing, distribution,
use, generation, treatment, storage, disposal, transport, shipping or handling,
the emission, discharge, release or threatened release into the environment of,
or exposure to, any Hazardous Material that could reasonably be expected to
have a Material Adverse Effect.

 

SECTION 4.16.  Solvency.  Immediately after giving effect to the
Transactions to occur on the Closing Date, (a) the present fair saleable
value of the assets of SSCC and the Subsidiaries, on a consolidated basis, will
exceed the amount that will be required to be paid on or in respect of the
existing debts and other liabilities (including contingent liabilities) of
SSCC  and the Subsidiaries, on a
consolidated basis, as they become absolute and mature, (b) SSCC and the
Subsidiaries, on a consolidated basis, will not have unreasonably small capital
to carry out their businesses as conducted or as proposed to be conducted, and
(c) neither SSCC nor any Borrower intends to, nor does it intend to permit
any of its subsidiaries to, and does not believe that it or any such

 

96

 

subsidiary will, incur debts beyond its
ability to pay such debts as they become absolute and mature (taking into
account the timing and amounts of cash to be received by each of them or any
such subsidiary and the amounts to be payable on or in respect of its
obligations).

 

SECTION 4.17.  Security Documents.  (a)  The
Guarantee and Collateral Agreement (U.S.), upon execution and delivery thereof
by the parties thereto, will create in favor of the Collateral Agent, for the
ratable benefit of the beneficiaries named therein, a legal, valid and
enforceable security interest in the Collateral (as defined therein) (other
than vessels) and proceeds thereof and (i) when the Pledged Collateral (as
defined therein) is delivered to the Collateral Agent, the Guarantee and
Collateral Agreement (U.S.) shall constitute a fully perfected first priority
Lien on, and security interest in, all right, title and interest of the Loan
Parties in such Pledged Collateral, in each case prior and superior in right to
any other Person, and (ii) when financing statements in appropriate form have
been duly filed in the offices specified on Schedule 4.17(a), the Lien
created under the Guarantee and Collateral Agreement (U.S.) (other than with
respect to the aforesaid Pledged Collateral) will constitute a fully perfected
Lien on, and security interest in, all right, title and interest of the Loan
Parties in such Collateral, and the proceeds thereof, to the extent perfection
can be obtained by filing Uniform Commercial Code financing statements, in each
case prior and superior in right to any other Person, other than with respect
to Permitted Liens.

 

(b)  The
Canadian Security Agreements and Hypothecs, upon execution and delivery thereof
by the parties thereto, will create in favor of the Collateral Agent, for the
ratable benefit of the beneficiaries named therein, a legal, valid and
enforceable security interest or hypothec in the Collateral (as defined in the
Canadian Security Agreements) (other than federally documented vessels,
registered vehicles, aircraft, railcars and other similar rolling stock and
other federally documented property) and proceeds thereof and (i) when the
Pledged Collateral (as defined in the Pledge Agreement (Canadian)) is delivered
to the Collateral Agent, the Pledge Agreement (Canadian) shall constitute a
fully perfected or published first priority or first-ranking Lien on, and
security interest in, all right, title and interest of the Loan Parties in such
Pledged Collateral, in each case prior and superior in right to any other
Person and (ii) when financing statements or applications for registration in
appropriate form have been duly filed or registered in the offices specified on
Schedule 4.17(b), each Lien created under the Canadian Security
Agreements and the Hypothecs will constitute a fully perfected or published
Lien on, and security interest or hypothecs in, all right, title and interest
of the Loan Parties in such Collateral, and the proceeds thereof, to the extent
perfection or publication can be obtained by filing Personal Property Security
Act financing statements or similar filings or registrations under the
applicable laws of any other Canadian jurisdiction, in each case prior and
superior in right to any other Person, other than with respect to Permitted
Liens.

 

(c)  When
the IP Security Agreements are duly filed with the United States Patent and
Trademark Office and the United States Copyright Office, as applicable, and
when financing statements in appropriate form have been duly filed

 

97

 

in the offices specified on Schedule 4.17(a), the security
interest created thereunder shall constitute a fully perfected Lien on, and security
interest in, all right, title and interest of the Loan Parties in the
registered intellectual property described therein and owned by the applicable
Loan Parties and in which a security interest may be perfected by filing a
security agreement in the United States, in each case prior and superior in
right to any other Person, other than with respect to Permitted Liens (it being
understood that subsequent recordings in the United States Patent and Trademark
Office and the United States Copyright Office may be necessary to perfect a
Lien on registered trademarks, trademark applications, designs, patents, patent
applications and copyrights acquired by a Loan Party after the Closing Date).

 

(d)  When
the Security Agreement (Canadian) and each Hypothec is duly filed with the
Canadian Intellectual Property Office, the security interest or hypothec
created thereunder shall constitute a fully perfected or published Lien on, and
security interest or hypothec in, all right, title and interest of the Loan
Parties in the registered intellectual property described therein and owned by
the applicable Loan Parties and in which a security interest or hypothec may be
perfected or published by filing, recording or registering a security
agreement, financing statement or analogous document in the Canadian
Intellectual Property Office, in each case prior and superior in right to any
other Person, other than with respect to Permitted Liens (it being understood
that subsequent recordings in the Canadian Intellectual Property Office may be
necessary to perfect or publish a Lien on such registered trademarks, trademark
applications, designs, patents, patent applications and copyrights acquired by
a Loan Party after the Closing Date).

 

(e)  The Mortgages create in favor of the Collateral
Agent, for the ratable benefit of the beneficiaries named therein, a legal,
valid and enforceable Lien on all of the Loan Parties’ right, title and
interest in and to the Mortgaged Properties thereunder and the proceeds
thereof, and when the Mortgages are duly filed or registered in the offices
specified on Schedule 4.17(e), the Mortgages will constitute a
fully perfected or published Lien on, and security interest or hypothec in, all
right, title and interest of the Loan Parties in such Mortgaged Properties and
the proceeds thereof, in each case prior and superior in right to any other
Person, other than with respect to Permitted Liens or other encumbrances
permitted by the relevant Mortgage.

 

SECTION 4.18.  Labor Matters.  As of the Closing Date, there are no strikes
or other labor disputes against SSCC or any of the Subsidiaries pending or, to
the knowledge of SSCC or either Borrower, threatened, except as set forth on Schedule 4.18.  The hours worked by and payment made to
employees of any Loan Party have not been in violation of the Fair Labor
Standards Act or any other applicable Federal, state, local or foreign law
dealing with such matters, where such violations could reasonably be expected,
individually or in the aggregate, to have a Material Adverse Effect.  The consummation of the Transactions will not
give rise to a right of termination or right of renegotiation on the part of
any union under any collective bargaining agreement to which SSCC or any of the
Subsidiaries is a party or by which SSCC or any of the Subsidiaries is bound on
the Closing Date.

 

98

 

SECTION 4.19.  Location of Real Property.  Schedule 4.19 sets forth as of
the Closing Date all material real property owned by SSCC or any of the
Subsidiaries in the United States and Canada. 
All the real property set forth on Schedule 4.19 is, as of
the Closing Date, owned in fee by SSCC or a Subsidiary or, in the case of any
real property located in the Province of Quebec, such real property is owned
under the tenure of free and common soccage
or under the tenure of franc alleu roturier
by SSCC or a Subsidiary.

 

SECTION 4.20.  Patents, Trademarks, etc.  Each of SSCC and the Subsidiaries owns, or is
licensed or otherwise authorized to use, all patents, designs, trademarks,
trade names, copyrights, technology, know-how and processes, service marks and
rights with respect to the foregoing that are used in or necessary for the
conduct of its business as currently conducted, except where the lack thereof
could not reasonably be expected to have a Material Adverse Effect.  The use of such patents, designs, trademarks,
trade names, copyrights, technology, know-how, processes and rights with
respect to the foregoing by SSCC and the Subsidiaries does not infringe on the
rights of any Person, subject to such claims and infringements as do not, in
the aggregate, give rise to any liability on the part of SSCC and the
Subsidiaries that is material to SSCC and the Subsidiaries, taken as a whole.

 

ARTICLE V

 

Conditions

 

The obligation
of each Lender to make Loans hereunder and the obligation of each Facing Agent
to issue, amend, extend or renew any Letter of Credit hereunder (each, a “Credit
Event”) is subject to the satisfaction of the following conditions:

 

SECTION 5.01.  All Credit Events.  On the date of each Credit Event:

 

(a)  The Administrative Agent and, where
applicable, the applicable Facing Agent or the Swingline Lender, shall have
received a notice of such Credit Event as required by Section 2.03,
3.02 or 2.21(b), respectively.

 

(b)  The representations and warranties set forth
in Article IV hereof and in the other Loan Documents shall be true
and correct in all material respects on and as of the date of such Credit Event
with the same effect as though made on and as of such date, except to the
extent that such representations and warranties expressly relate to an earlier
date.

 

(c)  At the time of and immediately after such
Credit Event, no Default or Event of Default shall have occurred and be continuing.

 

Each Credit
Event shall be deemed to constitute a representation and warranty by SSCC and
each Borrower on the date of such Credit Event as to the matters specified in paragraphs (b)
and (c) of this Section 5.01.

 

99

 

SECTION 5.02.  Conditions Precedent to the Closing Date.  On the Closing Date:

 

(a)  The Administrative Agent shall have received
a favorable written opinion of (i) Winston & Strawn LLP, U.S. counsel
for the Loan Parties, substantially to the effect set forth in Exhibit N-1,
and Craig A. Hunt, Vice President and General Counsel for SSCC and SSCE,
substantially to the effect set forth in Exhibit N-2, (ii) Stikeman
Elliott LLP, Ontario counsel for the Loan Parties, substantially to the effect
set forth in Exhibit N-3, (iii) Stikeman Elliott LLP, Quebec
counsel for the Loan Parties, substantially to the effect set forth in Exhibit N-4,
(iv) Stikeman Elliott LLP, Canadian tax counsel for SSC Canada, substantially
to the effect set forth in Exhibit N-5, (v) Stewart McKelvey
Stirling Scales, Nova Scotia counsel for the Loan Parties, substantially to the
effect set forth in Exhibit N-6 and (vi) each local counsel set forth on
Schedule 5.02(a), in each case (A) dated the Closing Date,
(B) addressed to the Agents, the Lenders and the Facing Agents, and
(C) covering such other matters relating to the Loan Documents as the
Senior Agents shall reasonably request and with such other changes as are
reasonably acceptable to the Senior Agents. 
SSCC and the Borrowers hereby instruct their counsel to deliver such
opinions.

 

(b)  All legal matters incident to this Agreement,
the Borrowings and other extensions of credit hereunder and the other Loan
Documents shall be reasonably satisfactory to the Senior Agents, the Lenders
and the Facing Agents.

 

(c)  The Administrative Agent shall have received
(i) a copy of the certificate or articles of incorporation, including all
amendments thereto, of each Loan Party, certified as of a recent date by the
Secretary of State or other relevant Governmental Authority of the jurisdiction
of its organization, and a certificate as to the good standing (or the
equivalent thereof) of each Loan Party as of a recent date from such Secretary
of State or other Governmental Authority; (ii) a certificate of the
Secretary or Assistant Secretary of each Loan Party dated the Closing Date and
certifying (A) that attached thereto is a true and complete copy of the by-laws
of such Loan Party as in effect on the Closing Date, (B) that attached thereto
is a true and complete copy of resolutions duly adopted by the Board of
Directors of such Loan Party authorizing the Credit Transactions, and that such
resolutions have not been modified, rescinded or amended and are in full force
and effect, (C) that the certificate or articles of incorporation of such
Loan Party have not been amended since the date of the last amendment thereto
shown on the certificate of good standing furnished pursuant to clause (i)
above, and (D) as to the incumbency and specimen signature of each officer
executing any Loan Document on behalf of such Loan Party; (iii) a
certificate of another officer as to the incumbency and specimen signature of
the Secretary or Assistant Secretary executing the certificate pursuant to clause
(ii) above; and such other documents as the Senior Agents may reasonably
request.

 

(d)  The Administrative Agent shall have received
a certificate, dated the Closing Date and signed by a Financial Officer of and
on behalf of each Borrower, confirming compliance with the conditions precedent
set forth in Section 5.01(b) and (c).

 

100

 

(e)  The Administrative Agent shall have received
all Fees and other amounts due and payable on or prior to the Closing Date, including,
to the extent invoiced, reimbursement or payment of all out-of-pocket expenses
required to be reimbursed or paid by either Borrower hereunder or under any
other Loan Document.

 

(f)  Each of the Guarantee and Collateral
Agreement (U.S.), the other Guarantee Agreements and the other Security
Documents (other than the Bank Act Security) shall have been duly executed by
the parties thereto and delivered to the Collateral Agent, and shall be in full
force and effect.  The Bank Act Security
shall have been duly executed by the parties thereto and delivered to each
Revolving (Canadian) Lender and each Tranche C Lender that is a Canadian
Chartered Bank listed in Schedule I, II or III of the Bank Act (Canada)
and all appropriate filings and registrations shall have been made in order to
provide to each such Lender enforceable Bank Act Security.  The Collateral Agent, on behalf of the
secured parties, shall have a security interest or hypothec in the Collateral
of the type and priority or rank described in each Security Document.

 

(g)  The Collateral Agent shall have received
(i) the results of a search of the Uniform Commercial Code filings made
with respect to the Loan Parties in the states of formation of such Persons and
in which the chief executive office of each such Person is located, together
with copies of the financing statements disclosed by such search and
(ii) the results of equivalent searches made in each other jurisdiction
reasonably requested by the Senior Agents, in each case accompanied by evidence
reasonably satisfactory to the Senior Agents that the Liens indicated in any
such financing statement (or similar document) or otherwise disclosed in such
searches would be permitted under Section 7.02 or have been
released.

 

(h)  None of the Mortgaged Properties shall be
subject to any Lien other than those expressly permitted under Section 7.02
and other encumbrances permitted by the relevant Mortgage.  The Senior Agents shall have received a
lender’s title insurance policy or, in the case of Mortgaged Property located
in Canada, except as otherwise agreed to by the Senior Agents, a written legal
opinion, paid for by the Borrowers, in form and substance reasonably acceptable
to the Senior Agents, insuring or opining, as the case may be, that each Mortgage
relating to any Mortgaged Property constitutes a first lien on such Mortgaged
Property (subject to any Lien expressly permitted by Section 7.02
or otherwise agreed to by the Senior Agents), and the Collateral Agent shall
have received such other documents relating to Mortgaged Properties as
reasonably requested in writing by the Senior Agents.

 

(i)  The Administrative Agent shall have received
copies of, or an insurance broker’s or agent’s certificate as to coverage
under, the insurance policies required by Section 6.02 and the
applicable provisions of the Security Documents, each of which policies shall
be endorsed or otherwise amended to include a loss payable endorsement with
respect to the Collateral and to name the Collateral Agent as additional insured,
in form and substance reasonably satisfactory to the Administrative Agent.

 

101

 

(j)  The Collateral Agent shall have received a
reasonably satisfactory perfection certificate with respect to the Loan Parties
dated the Closing Date and duly executed by a Responsible Officer of SSCC.

 

(k)  The Merger shall have been, or substantially
simultaneously with the initial funding of Loans on the Closing Date shall be,
consummated in accordance with the Merger Agreement and applicable law.  The Administrative Agent shall have received
copies of the Merger Agreement and all certificates and other documents
delivered thereunder.  The Senior Agents
shall be reasonably satisfied with the material terms and conditions of the
Merger.

 

(l)  All principal, interest, fees and other
amounts due and owing under the Existing Credit Agreements shall have been
repaid in full, the commitments thereunder shall have been terminated and all
guarantees thereof and liens in connection therewith released and discharged
(or arrangements reasonably satisfactory to the Senior Agents shall be in place
for such release and discharge), and the Administrative Agent shall have
received reasonably satisfactory evidence thereof.

 

(m)  The Lenders shall have received (i)
management’s financial projections for SSCE and the Subsidiaries for a period
of six years following the Closing Date, reflecting the Transactions and
including the material assumptions on which such projections were based, in each
case in form and substance reasonably satisfactory to the Senior Agents, and
(ii) a pro forma consolidated balance sheet of SSCE as of a recent date
prior to the Closing Date, after giving effect to the Transactions, which, in
each case, shall be prepared in good faith and based upon reasonable
assumptions.

 

(n)  The Senior Agents shall be reasonably
satisfied as to the amount and nature of any environmental and employee health
and safety exposures to which SSCC and the Subsidiaries, taken as a whole, may
be subject, and the plans of SSCC and the Subsidiaries with respect thereto,
after giving effect to the Transactions.

 

(o)  All material consents of Governmental
Authorities and third parties to the Transactions to occur on the Closing Date
shall have been obtained, and there shall not be any pending or threatened
litigation or governmental, administrative or judicial action that could
reasonably be expected to restrain, prevent or impose burdensome conditions on
the Transactions.

 

ARTICLE VI

 

Affirmative Covenants

 

Each of SSCC
and the Borrowers covenants and agrees with each Lender, each Agent and each
Facing Agent that, so long as this Agreement shall remain in effect, the LC
Exposure shall not equal zero or the principal of or interest on any Loan or any
LC Disbursement, Fees or any other expenses or amounts payable under any Loan

 

102

 

Document shall
remain unpaid, unless the Required Lenders shall otherwise consent in writing,
it will, and will cause each of the Subsidiaries to:

 

SECTION 6.01.  Existence; Businesses and Properties.  (a)  Do
or cause to be done all things necessary to preserve, renew and keep in full
force and effect its legal existence, except as otherwise permitted under Section 7.05;
provided, however, that any FinSub that no longer purchases, or
is required to purchase, receivables pursuant to any Receivables Program and
otherwise no longer participates in any Receivables Program may be wound up,
liquidated or dissolved.

 

(b)  Except where the failure to do so could not
be reasonably expected to have a Material Adverse Effect, (i) do or cause to be
done all things necessary to preserve, renew and keep in full force and effect
the rights, licenses, permits, trademarks, tradenames, privileges and
franchises necessary or desirable in the normal conduct of its business, and
(ii) at all times keep all property useful and necessary in its business in
good working order and condition.

 

SECTION 6.02.  Insurance.  Keep its insurable properties adequately
insured at all times by financially sound and reputable insurers; maintain such
other insurance, to such extent and against such risks, including fire and
other risks insured against by extended coverage, as is usually maintained in
the same general area by companies engaged in the same or similar businesses,
including public liability insurance against claims for personal injury or
death or property damage occurring upon, in, about or in connection with the
use of any properties owned, occupied or controlled by it or the use of any
products sold by it; and maintain such other insurance as may be required by
law and, with respect to the Mortgaged Properties, as is required by the
Mortgages.

 

SECTION 6.03.  Payment of Taxes.  Pay and discharge promptly prior to becoming
delinquent all material taxes, assessments and governmental charges or levies
imposed upon it or upon or in respect of its property or assets; provided,
however, that such payment and discharge shall not be required with
respect to any such tax, assessment, charge or levy so long as the validity or
amount thereof shall be contested in good faith by appropriate proceedings and
it shall have set aside on its books, in accordance with U.S. GAAP, adequate
reserves with respect thereto and such contest operates to suspend enforcement
of a Lien and, in the case of a Mortgaged Property or other material property
or asset, there is no material risk of forfeiture of such property.

 

SECTION 6.04.  Financial Statements, Reports, etc.  Furnish to the Administrative Agent, each
Senior Agent and each Lender:

 

(a)  in
the case of SSCC, within 90 days after the end of each fiscal year, its
consolidated balance sheet and related statements of operations, stockholders’
equity and cash flows, showing the financial condition of SSCC and its
consolidated Subsidiaries as of the close of such fiscal year and the results
of its operations and the operations of such Subsidiaries during such fiscal
year, all audited by Ernst & Young LLP or other independent auditors of
recognized national standing and accompanied by an opinion of such accountants
(which

 

103

 

shall not be qualified in any material respect) to the effect that such
consolidated financial statements fairly present in all material respects the
financial condition and results of operations of SSCC and the Subsidiaries on a
consolidated basis in accordance with U.S. GAAP;

 

(b)  in
the case of SSCC, within 45 days after the end of each of the first three
fiscal quarters of each fiscal year, its unaudited consolidated balance sheet
and related statements of operations, stockholders’ equity and cash flows,
showing the financial condition of SSCC and its consolidated Subsidiaries as of
the close of such fiscal quarter and the results of its operations and the
operations of such Subsidiaries during such fiscal quarter and the then-elapsed
portion of the fiscal year (it being understood that such information shall be
in reasonable detail and certified by a Financial Officer of SSCC, as fairly
presenting in all material respects the financial condition and results of
operations of SSCC and the Subsidiaries on a consolidated basis in accordance
with U.S. GAAP, subject to normal year-end audit adjustments and the absence of
notes);

 

(c)  concurrently
with any delivery of financial statements of SSCC under paragraph (a)
or (b) above, a certificate of a Financial Officer of SSCC
(i) certifying that, after reasonable inquiry, to the knowledge of such
Financial Officer no Default or Event of Default has occurred or, if a Default
or an Event of Default has occurred, specifying the nature and extent thereof
and any corrective action taken or proposed to be taken with respect thereto
and (ii) setting forth computations in reasonable detail satisfactory to
the Senior Agents of the ratios contemplated by the definition of the term “Applicable
Rate” and demonstrating compliance with the covenants contained in Sections 7.01,
7.02, 7.03, 7.04, 7.06, 7.13, 7.14
and 7.15 and, in the case of any such certificate delivered in
connection with any delivery of financial statements of SSCC under paragraph
(a) above for the fiscal year ended on or after December 31, 2005, of
the Excess Cash Flow for the latest fiscal year covered thereby;

 

(d)  concurrently
with any delivery of financial statements under paragraph (a)
above, a certificate of the accounting firm opining on such statements (which
certificate may be limited to accounting matters and disclaim responsibility
for legal interpretations) stating that during the course of their examination
of such financial statements, they obtained no knowledge of any Default or
Event of Default, except as specified in such certificate;

 

(e)  promptly
after the same become publicly available, copies of all periodic and other
reports, proxy statements and other materials (other than (i) the exhibits
to registration statements and (ii) any registration statements on Form S-8
or its equivalent) filed by SSCC or any of the Subsidiaries with the Securities
and Exchange Commission, or any Governmental Authority succeeding to any of or
all the functions of such Commission, or with any securities commission of any
Canadian province, or with any Canadian or U.S. securities exchange, or
distributed to any such Person’s shareholders (other than to SSCC or any of the
Subsidiaries), as the case may be;

 

104

 

(f)  in
the case of SSCC, as soon as available, and in any event no later than
90 days after the end of each fiscal year, a consolidated annual plan,
prepared in accordance with SSCC’s normal accounting procedures applied on a
consistent basis, for the next fiscal year of SSCC; and

 

(g)  promptly
from time to time, such other information regarding the operations, business affairs
and financial condition of SSCC and the Subsidiaries, or compliance with the
terms of any Loan Document, as any Senior Agent, the Administrative Agent or
any Lender may reasonably request.

 

SECTION 6.05.  Litigation and Other Notices.  Furnish to each Senior Agent, the
Administrative Agent and each Lender written notice of the following promptly
upon a Responsible Officer of SSCC or any Subsidiary obtaining knowledge
thereof:

 

(a)  any
Event of Default or Default, specifying the nature and extent thereof and the
corrective action (if any) taken or proposed to be taken with respect thereto;

 

(b)  the
filing or commencement of, or any notice to SSCC or any Subsidiary of the
intention of any Person to file or commence, any action, suit or proceeding (whether
at law or in equity or by or before any Governmental Authority or any
arbitrator) against SSCC or any Affiliate thereof that, if adversely
determined, could reasonably be expected to result in a Material Adverse
Effect;

 

(c)  any
development that has resulted in, or could reasonably be anticipated to result
in, a Material Adverse Effect; and

 

(d)  the
occurrence of any ERISA Event that, alone or together with other ERISA Event,
could reasonably be expected to result in liability of SSCC or any of the Subsidiaries
in an aggregate amount exceeding U.S.$30,000,000.

 

SECTION 6.06.  Maintaining Records; Access to Properties
and Inspections.  Maintain all
financial records in accordance with U.S. GAAP or Canadian GAAP, as applicable,
and permit any representatives designated by any Senior Agent, the
Administrative Agent or any Lender to visit and inspect the properties and
financial records of SSCC and any Subsidiary during normal business hours and
upon reasonable notice and to make extracts from and copies of such financial
records (provided that, unless an Event of Default shall have occurred
and is continuing, no more than three such visits and inspections may be made
in any one year) and permit any representatives designated by any Senior Agent,
the Administrative Agent or any Lender to discuss at such reasonable times and
at such reasonable intervals as may be reasonably requested the affairs,
finances and condition of SSCC or any Subsidiary or any properties of SSCC or
any Subsidiary with the officers thereof and (in the presence of SSCC or a
Subsidiary, unless a Default or Event of Default shall have occurred and be
continuing) independent

 

105

 

accountants therefor; provided, however,
that all such visits, inspections and inquiries shall be coordinated through
the Senior Agents.

 

SECTION 6.07.  Use of Proceeds.  Use the proceeds of Loans and request the
issuance of Letters of Credit only for the purposes set forth in the
introductory statement to this Agreement. 
No part of the proceeds of any Loan will be used, whether directly or
indirectly, for any purpose that entails a violation of any of the Regulations
of the Board, including Regulations T, U and X.

 

SECTION 6.08.  Compliance with Law.  Comply with the requirements of all
applicable laws (including Environmental Laws), rules, regulations and decrees,
directives and orders of any Governmental Authority that are applicable to it
or to any of its properties, except where noncompliance could not reasonably be
expected to have a Material Adverse Effect.

 

SECTION 6.09.  Further Assurances.  (a)  Execute
any and all further documents, financing statements, agreements and
instruments, and take all further action (including filing Uniform Commercial
Code and other financing statements, registrations, mortgages, hypothecs and
deeds of trust), that may be required under applicable law or which the
Required Lenders, any Senior Agent or the Administrative Agent may reasonably
request, in order to effectuate the transactions contemplated by the Loan
Documents and in order to grant, preserve, protect, perfect and publish the
validity and priority or rank of the security interests and hypothecs created
or intended to be created by the Security Documents.

 

(b)  Cause (i) each Domestic Subsidiary that is or
becomes a Material Subsidiary (other than any FinSub), and each Domestic
Subsidiary that is or becomes a direct parent of any such Material Subsidiary,
to become a party to the Guarantee and Collateral Agreement (U.S.) and, if such
Material Subsidiary owns any real or personal property in the State of
Maryland, the Guarantee Agreement (Maryland) and (ii) each Canadian Subsidiary
that is or becomes a Material Subsidiary (other than any FinSub), and each
Canadian Subsidiary that is or becomes a direct parent of any such Material
Subsidiary, to become a party to the Guarantee Agreement (Canadian) and the
Canadian Security Agreements or, with respect to any such Canadian Subsidiary
that is organized under the laws of the Province of Quebec and with respect to
any Collateral located in the Province of Quebec, such Hypothecs and other
Security Documents, and such guarantee agreements, as may be reasonably
requested by the Collateral Agent.

 

(c)  From time to time, SSCC and the Borrowers
will, at their cost and expense, promptly secure the Obligations by pledging or
creating, or causing to be pledged or created, perfected (or, in the case of
the Province of Quebec, published) security interests or hypothecs with respect
to such of the assets and properties of the Loan Parties as either Senior Agent
or the Required Lenders shall reasonably request (it being understood that,
subject to the limitations set forth in this paragraph (c), it is the
intent of the parties that the Obligations shall be secured by substantially
all of the U.S. and Canadian assets of the Loan Parties (including real and
personal properties acquired after the Closing Date); provided, however,
that notwithstanding anything to the contrary

 

106

 

set forth in this Agreement or any other Loan
Document, (i) none of the Canadian Subsidiaries or any of their subsidiaries
shall be required to guarantee or provide any security for any U.S. Obligation,
(ii) not more than 65% of the voting capital stock of any Foreign Subsidiary
shall be required to be pledged by SSCC, SSCE or any Domestic Subsidiary, (iii)
no leasehold mortgages or deeds of trust or fixture filings (or comparable
filings in Canada) shall be required with respect to any leasehold interest of
any Loan Party and (iv) no security interests or hypothecs shall be
required to be pledged or created with respect to (A) Program Receivables,
(B) properties set forth on Schedule 6.09(c), (C) equity
interests in any Person that is not or is not required to be a Loan Party (and
equity interests in any Material Subsidiary that is a FinSub) and (D) any
assets located outside of the United States or Canada; and provided  further
that, except as provided in paragraph (d) below with respect to
After-Acquired Mortgage Property, neither SSCC nor any Borrower shall be
required to take any further action pursuant to this paragraph (c)
unless and until the aggregate fair market value of the assets and properties
subject to such request exceeds U.S.$25,000,000.  Such security interests and Liens will be
created under the Security Documents and other security agreements, mortgages,
deeds of trust and other instruments and documents in form and substance
reasonably satisfactory to the Collateral Agent, and SSCC and the Borrowers
shall deliver or cause to be delivered to the Lenders all such instruments and
documents (including customary legal opinions, title insurance policies or
title opinions and lien searches) as the Collateral Agent shall reasonably
request to evidence compliance with this paragraph (c).  SSCC and the Borrowers agree to provide such
evidence as the Collateral Agent shall reasonably request as to the perfection
and priority status of each such security interest and Lien.

 

(d)  Notwithstanding anything to the contrary in paragraph
(c) above, no security interests or hypothecs shall be required to be
created pursuant to paragraph (c) above by any Loan Party with
respect to (i) any After-Acquired Mortgage Property with a fair market
value (as determined by the applicable Loan Party in its reasonable judgment,
it being understood that the purchase price shall be indicative thereof) (the “Fair
Market Value”) of less than U.S.$3,000,000 and (ii) any After-Acquired
Mortgage Property with a Fair Market Value of at least U.S.$3,000,000 but less
than U.S.$25,000,000, unless and until the aggregate Fair Market Value of all
items of After-Acquired Mortgage Property excluded pursuant to this clause
(ii) (and not granted as security for the Obligations pursuant to the next
sentence) is at least U.S.$50,000,000 in the aggregate for all Loan
Parties.  On each occasion that the Fair
Market Value of all items of After-Acquired Mortgage Property described
in clause (ii) of the immediately preceding sentence shall be at least
U.S.$50,000,000, SSCC and the Borrowers shall create, or shall cause to be
created, security interests or hypothecs on all such property (and not merely
the portion of the property in excess of U.S.$50,000,000) to secure the Applicable
Obligations (and thereafter, such property shall be disregarded for purposes of
the calculation under clause (ii) of the immediately preceding
sentence).

 

SECTION 6.10.  Material Contracts.  Maintain in full force and effect (including
exercising any available renewal option), and without amendment or
modification, each Material Contract, unless the failure so to maintain any
such Material

 

107

 

Contract (or any amendment or modification
thereto) could not, individually or in the aggregate, be reasonably expected to
have a Material Adverse Effect.

 

SECTION 6.11.  Environmental Matters.  (a)  Promptly
give notice to the Administrative Agent upon becoming aware of (i) any
violation of any Environmental Law, (ii) any claim, inquiry, proceeding,
investigation or other action, including a request for information or a notice
of potential liability under any Environmental Law, by or from any Governmental
Authority or any third party claimant or (iii) the discovery of the
release of any Hazardous Material at, on, under or from any of the Real
Properties or any facility or equipment thereat in excess of reportable or
allowable standards or levels under any Environmental Law, or in a manner or
amount that could reasonably be expected to result in liability under any
Environmental Law, in each case that could reasonably be expected to have a
Material Adverse Effect.

 

(b)  Upon
discovery of the presence on any of the Real Properties of any Hazardous
Material that is in violation of, or that could reasonably be expected to
result in liability under, any Environmental Law, in each case that could
reasonably be expected to have a Material Adverse Effect, take or cause to be
taken all necessary steps to initiate and expeditiously complete all remedial,
corrective and other action to eliminate any such adverse effect, and keep the
Administrative Agent reasonably informed of such actions and the results
thereof.

 

ARTICLE VII

 

Negative Covenants

 

Each of SSCC
and the Borrowers covenants and agrees with each Lender, each Agent and each
Facing Agent that, so long as this Agreement shall remain in effect, the LC
Exposure shall not equal zero or the principal of or interest on any Loan or
any LC Disbursement, Fees or any other expenses or amounts payable under any
Loan Document shall remain unpaid, unless the Required Lenders shall otherwise
consent in writing, it will not, and will not cause or permit any of the
Subsidiaries to:

 

SECTION 7.01.  Indebtedness.  Create, incur, assume or permit to exist any
Indebtedness or Attributable Indebtedness, except, without duplication:

 

(a)  the
Indebtedness created hereunder and under the other Loan Documents;

 

(b)  the
Senior Notes and any Guarantees thereof by any Loan Party;

 

(c)  the
Indebtedness existing on the Closing Date and listed on Schedule 7.01;

 

(d)  Indebtedness
of any Foreign Subsidiary (other than a Canadian Subsidiary) and any Guarantees
thereof, provided that such Indebtedness shall not

 

108

 

be Guaranteed by or otherwise be recourse to SSCC, any Domestic
Subsidiary or any Canadian Subsidiary, except as permitted by paragraph (o)
below or Section 7.04(c) or (l);

 

(e)  Indebtedness
of SSCC or any Subsidiary the net proceeds of which are designated to be used,
and are used reasonably promptly after the incurrence thereof, to refinance
Indebtedness described in paragraph (b) or (c) above, paragraph
(p) or (q) below or this paragraph (e) (such
Indebtedness being referred to herein as “Specified Indebtedness”), so
long as (i) such refinancing Indebtedness is in an aggregate principal
amount not greater than the aggregate principal amount of the Specified
Indebtedness being refinanced plus the amount of any premium required to
be paid thereon and any interest, fees and costs incurred in such refinancing,
(ii) such refinancing Indebtedness has a final maturity more than
90 days after the later of Term Loan Maturity Date and the Incremental
Term Loan Maturity Date (if any) and a weighted average life to maturity
greater than the weighted average life to maturity of the Term Loans and
(iii) the covenants, events of default and other provisions (other than
optional redemption provisions and other pricing terms) thereof (including any
Guarantees thereof) shall be no more materially adverse, when taken as a whole,
to the Lenders than those contained in the Specified Indebtedness being
refinanced; provided that (A) if the proceeds of Revolving Loans or
Revolving (Canadian) Loans are used to repurchase or redeem any Specified
Indebtedness, the Borrowers may incur Indebtedness otherwise meeting the
requirements of this paragraph (e) (as if such Indebtedness were
used to refinance such Specified Indebtedness) to repay such Revolving Loans or
Revolving (Canadian) Loans, (B) the Specified Indebtedness may be
refinanced with senior notes, senior subordinated notes or convertible
debentures that contain covenants, events of default and other terms and
conditions that are no more restrictive to SSCE or the Subsidiaries than is
customary, at the time of such refinancing, for Indebtedness of such type for
issuers with a debt rating similar to that of SSCE, and (C) if the proceeds of
indebtedness meeting the requirements of this paragraph (e) cannot be
immediately applied to refinance the Specified Indebtedness, then, unless such
proceeds are held by SSCC or a Subsidiary pending such refinancing, they may be
used to prepay Revolving Loans, Revolving (Canadian Loans) or other revolving
debt, which then may be used to refinance such Specified Indebtedness;

 

(f)  (i) Capital
Lease Obligations and Attributable Indebtedness, (ii) Indebtedness
created, incurred or assumed in respect of the purchase, improvement or
construction of property, provided that such Indebtedness is created,
incurred or assumed within 120 days after the earlier of (x) the
placement in service of such property or (y) the final payment on such
property, and (iii) Indebtedness consisting of industrial revenue bonds or
pollution control bonds, and Guarantees of and letters of credit supporting
such Indebtedness, such that the sum of the Indebtedness and Attributable
Indebtedness created, incurred or assumed pursuant to this paragraph (f)
shall not exceed at any time outstanding U.S.$500,000,000;

 

109

 

(g)  Indebtedness
created pursuant to any Swap Agreement that has been entered into (i) to hedge
or mitigate risks to which SSCC or any Subsidiary has actual exposure (other
than those in respect of equity interests) or (ii) to effectively cap, collar
or exchange interest rates (from fixed to floating rates, from one floating
rate to another floating rate or otherwise) with respect to any
interest-bearing liability or investment of SSCC or any Subsidiary;

 

(h)  intercompany
loans and advances permitted by Section 7.04;

 

(i)  Indebtedness
of any FinSub, SSCC or any Participating Subsidiary created pursuant to the
Receivables Program Documents (including any Indebtedness of SSCC or any
Participating Subsidiary to any FinSub arising because any sale or purported
sale of Program Receivables to such FinSub is required to be recharacterized as
a loan);

 

(j)  Indebtedness
of FinSubs to SSCC or any Participating Subsidiary that, when combined with any
Investments pursuant to Section 7.04(g), does not exceed in the
aggregate at any time outstanding U.S.$100,000,000;

 

(k)  Indebtedness
incurred to pay annual premiums for property and casualty insurance policies
maintained by SSCC or any Subsidiary not exceeding in an aggregate amount at
any time outstanding U.S.$75,000,000;

 

(l)  Indebtedness
of SSCC and the Subsidiaries in respect of letters of credit, so long as such
Indebtedness is not secured and does not exceed in an aggregate amount at any
time outstanding U.S.$50,000,000;

 

(m)  Indebtedness
of any Person acquired by SSCC or any Subsidiary in an acquisition permitted
hereunder and assumed by SSCC or such Subsidiary pursuant to such acquisition
(including any refinancing, renewal or replacement, in whole or in part, thereof
at the time of assumption thereof or from time to time thereafter), provided
that (i) such Indebtedness was not incurred in contemplation of such
acquisition and (ii) the aggregate principal amount of such Indebtedness
at any time outstanding shall not exceed U.S.$100,000,000;

 

(n)  Guarantees
with respect to bonds issued to support workers’ compensation, or performance,
surety, statutory or appeal bonds and other similar obligations (other than
Indebtedness) incurred by SSCC or any Subsidiary in the ordinary course of
business;

 

(o)  Indebtedness
of SSCC or any Subsidiary incurred in the ordinary course of business that does
not exceed in an aggregate amount at any time outstanding U.S.$150,000,000;

 

(p)  unsecured
Indebtedness of any Loan Party or any Special Purpose Finance Subsidiary (which
Indebtedness may be Guaranteed on an unsecured basis by one or more Loan
Parties) the net proceeds of which are designated to be used, and are used
reasonably promptly after the incurrence thereof, to refinance

 

110

 

in whole or in part the Term Loans, so long as such refinancing
Indebtedness (i) is in an aggregate principal amount not greater than the
aggregate principal amount of the Indebtedness being refinanced plus the
amount of any premium required to be paid thereon and any interest, fees and
costs incurred in such refinancing, (ii) has a final maturity more than 90 days
after the later of the Term Loan Maturity Date and the Incremental Term Loan
Maturity Date (if any) and requires no scheduled payment of principal in cash
prior to such date, and (iii) includes covenants, events of default and other
terms and conditions that are no more restrictive, when taken as a whole, to
SSCC or the Subsidiaries than is customary, at the time of such refinancing,
for Indebtedness of such type for issuers with a debt rating similar to that of
SSCC;

 

(q)  unsecured
Indebtedness incurred by any Loan Party or any Special Purpose Finance
Subsidiary to finance a Permitted Acquisition (“Acquisition Indebtedness”);
provided, that (i) at the time of the incurrence of such Acquisition
Indebtedness, both before and immediately after giving effect thereto and such
Permitted Acquisition, no Default or Event of Default shall have occurred and
be continuing, (ii) such Acquisition Indebtedness has a final maturity more
than 90 days after the later of the Term Loan Maturity Date and the Incremental
Term Loan Maturity Date (if any) and requires no scheduled or other mandatory
payment of principal in cash (including any payment in cash at the option of
the holders of such Indebtedness and any payment in cash pursuant to a sinking
fund obligation, but excluding any payment required upon the occurrence of a
change of control) prior to the date that is 90 days after the later of the
Term Loan Maturity Date and the Incremental Term Loan Maturity Date (if any),
(iii) after giving pro forma effect to the incurrence of such Acquisition
Indebtedness and such Permitted Acquisition, the Consolidated Leverage Ratio as
of the date of such incurrence, calculated in accordance with Section 1.05,
shall not exceed 5.5 to 1.0; and (iv) on or prior to the date of such
incurrence, SSCC shall have delivered a certificate of a Financial Officer
confirming compliance with this paragraph (q), together with reasonably
detailed calculations demonstrating satisfaction of the requirement set forth
in clause (iii) above;

 

(r)  Indebtedness
of SSCC or any Subsidiary evidencing obligations to make payments in respect of
rights to cut, harvest or otherwise acquire timber on property owned by any
other Person, provided that the aggregate amount of such Indebtedness
shall not exceed $10,000,000 at any time outstanding;

 

(s)  Indebtedness
incurred in connection with (i) Permitted Equipment Financings in an aggregate
principal amount not to exceed $100,000,000 at any time outstanding or (ii)
Permitted Timber Financings;

 

(t)  SSCC
Convertible Subordinated Exchange Debentures;

 

(u)  Indebtedness
in the form of any earnout or other similar contingent payment obligation
incurred in connection with an acquisition permitted hereunder; and

 

111

 

(v)  Indebtedness
of PUI in an aggregate amount not to exceed U.S.$10,000,000 outstanding at any
time, and the Guarantee thereof by SSCE on an unsecured basis.

 

SECTION 7.02.  Liens. 
(a)  Create, incur, assume or
permit to exist any Lien on any property or assets (including stock or other
securities of any Person) now owned or hereafter acquired by it or on any
income or revenues or rights in respect of any thereof, except:

 

(i) Permitted Liens;

 

(ii) Liens created under the Loan Documents;

 

(iii) Liens on Program Receivables granted
pursuant to the Receivables Program Documents;

 

(iv) Liens existing as of the Closing Date and
listed on Schedule 7.02(a)(iv), provided that (A) such Liens
shall apply only to the property or assets to which they apply on the Closing
Date and (B) such Liens shall secure only (x) those obligations that they
secure on the Closing Date and (y) refinancings of such secured obligations
permitted hereunder so long as the principal amount of obligations secured
under this clause (iv) does not exceed the sum of the principal amount
of such secured obligations being refinanced plus the amount of any
premium required to be paid thereon as a result of, and any interest, fees and
costs incurred in, such refinancing;

 

(v) Liens securing Indebtedness permitted by Section 7.01(f),
provided that any such Lien shall apply only to the property that is the
subject of such Indebtedness and, if applicable, the principal amount of
Indebtedness secured by any such Lien shall at no time exceed 100% of the fair
market value (as determined in good faith by SSCC or a Subsidiary, as
applicable) of the respective property at the time it was so acquired;

 

(vi) Liens for Indebtedness permitted by Section 7.01(k),
provided that such Liens attach only to unearned and return premiums,
dividends and loss payments which reduce the unearned premiums under insurance
policies the premiums of which have been financed with such Indebtedness;

 

(vii) Liens securing Indebtedness
constituting mortgage or purchase money financings, Capital Lease Obligations,
industrial revenue bonds or similar financings assumed or incurred pursuant to Section
7.01(m) in connection with any acquisition permitted hereunder, provided
that (A) such Liens attach only to property or assets acquired in connection
with such acquisition, (B) such Liens were not created in contemplation of
such acquisition and (C) such Liens shall secure only those obligations that
they secure at the time of such acquisition and refinacings thereof permitted

 

112

 

hereunder so long as the principal amount of obligations secured under
this clause (vii) is not increased;

 

(viii) Liens on property or assets owned by
Foreign Subsidiaries securing Indebtedness permitted under Section 7.01(d)
and Liens on property or assets owned by PUI securing Indebtedness permitted
under Section 7.01(v);

 

(ix) Liens created under any agreement
relating to the sale, transfer or other disposition of assets permitted
hereunder, provided that such Liens relate solely to the assets to be
sold, transferred or otherwise disposed;

 

(x) any Lien consisting of a lease of
personal property of such Person to customers of such Person, if such lease
constitutes an Investment permitted under Section 7.04(i);

 

(xi) Liens deemed to exist in connection with
any Permitted Investment, provided such Liens only apply to the assets
constituting such Permitted Investment;

 

(xii) Liens on assets of a Borrower or any
Subsidiary securing up to U.S.$125,000,000 of Indebtedness permitted by Section 7.01(o),
provided that no such Lien shall apply to any assets constituting Collateral;

 

(xiii) Liens on the assets listed on Schedule
6.09(c), securing Indebtedness otherwise permitted hereunder;

 

(xiv) Liens securing any Permitted Equipment
Financing or any Permitted Timber Financing;

 

(xv) extensions, renewals or replacements of
any Lien referred to above, provided that such extension, renewal or
replacement is limited to the Indebtedness and property originally secured and
encumbered thereby; and

 

(xvi) Liens not otherwise permitted by the
foregoing clauses of this paragraph (a) securing obligations in an
aggregate amount outstanding at any time not in excess of U.S.$25,000,000.

 

(b)  Enter
into any agreement prohibiting the creation or assumption of any Lien upon
properties or assets, whether now owned or hereafter acquired, except any such
restriction that exists under (i) this Agreement, (ii) the indentures
governing the Senior Notes (or any refinancing thereof pursuant to Section 7.01(e)),
(iii) with respect to any FinSub or SMBI, the applicable Receivables
Program, (iv) agreements governing any Indebtedness of Foreign
Subsidiaries (other than the Canadian Subsidiaries) permitted hereunder,
(v) any documents governing secured Indebtedness permitted hereunder, provided
that such restrictions only relate to the assets securing such Indebtedness,
(vi) any documents governing Indebtedness

 

113

 

permitted under Section 7.01(b), (e), (o), (p)
or (q), provided that such restrictions are no more restrictive
to SSCC or any Subsidiary than the restrictions under the documents governing
Indebtedness permitted under Section 7.01(b), (vii) restrictions by
reason of customary provisions contained in leases, licenses, governmental
contracts and similar agreements entered into in the ordinary course of
business, provided that such restrictions are limited to the property or
assets subject to such leases, licenses, contracts or agreements), and (viii)
any agreement with respect to a permitted sale or disposition of any assets, provided
such restrictions are limited to the assets to be sold or disposed of.

 

SECTION 7.03.  Sale/Leaseback Transactions.  Enter into any Sale/Leaseback Transaction,
other than (a) Permitted Equipment Financings in an aggregate principal amount
not to exceed $100,000,000, (b) any Permitted Timber Financing or (c) any
Sale/Leaseback Transaction to the extent that (i) the Capital Lease Obligations
or Attributable Indebtedness, as the case may be, would be permitted by Section
7.01(f)(i) and (ii) any Liens associated therewith would be permitted by Section 7.02(a)
(provided that, if SSCC or any of the Subsidiaries enter into such
Sale/Leaseback Transaction with respect to any property owned by SSCC or such
Subsidiary more than 12 months prior to such transaction, such
Sale/Leaseback Transaction shall be treated as an Asset Sale and shall also be
subject to the restrictions of Section 7.16).

 

SECTION 7.04.  Investments, Loans and Advances.  Have outstanding or make any loan or advance
to, or have or make any Investment in, any other Person or suffer to exist any
such loan, advance or Investment, or any obligation to make such loan, advance
or Investment, except as set forth on Schedule 7.04 and except:

 

(a)  Permitted
Investments;

 

(b)  loans,
advances or other Investments made by (i) SSCC or any Subsidiary to
or in any Guarantor, any wholly owned Domestic Subsidiary or any wholly owned
Canadian Subsidiary (provided that any such Investments by a Loan Party
to or in any such Subsidiary that is not a Loan Party complies with the
requirements of Section 7.16) and (ii) any Foreign Subsidiary
(other than a Canadian Subsidiary) to or in any other Foreign Subsidiary;

 

(c)  loans,
advances or other Investments made to or in any Subsidiary (other than a
Guarantor, a wholly owned Domestic Subsidiary or a wholly owned Canadian
Subsidiary), and Guarantees of obligations of any such Subsidiary, in an
aggregate amount not to exceed U.S.$100,000,000 outstanding at any time;

 

(d)  Investments
consisting of non-cash consideration received in connection with a sale of
assets permitted under Section 7.16;

 

(e)  Investments
by SSCC and the Subsidiaries in existence on the Closing Date in the capital
stock of their respective subsidiaries;

 

114

 

(f)  Investments
consisting of securities or notes received in settlement of accounts receivable
incurred in the ordinary course of business from a customer that SSCC or any
Subsidiary has reasonably determined is unable to make cash payments in
accordance with the terms of such account receivable;

 

(g)  Investments
by SSCC or any Participating Subsidiary in FinSubs that, when combined with any
Indebtedness outstanding pursuant to Section 7.01(j), do not exceed
in the aggregate at any time outstanding U.S.$100,000,000;

 

(h)  accounts
receivable created or acquired, and deposits, prepayments and other credits to
suppliers made, in the ordinary course of business;

 

(i)  any
Investments consisting of (i) any contract pursuant to which SSCC or any
Subsidiary obtains the right to cut, harvest or otherwise acquire timber on
property owned by any other Person, whether or not SSCC’s or such Subsidiary’s
obligations under such contract are evidenced by a note or other instrument, or
(ii) loans or advances to customers of SSCC or any Subsidiary, including
leases of personal property of SSCC or such Subsidiary to such customers, provided
that the contracts, loans and advances constituting permitted Investments
pursuant to this paragraph (i) shall not exceed U.S.$20,000,000 at
any time outstanding;

 

(j)  deposits
made in the ordinary course of business to secure performance of operating
leases;

 

(k)  loans
to officers and employees not to exceed U.S.$5,000,000 at any time outstanding;

 

(l)  other
Investments in an aggregate amount at any time outstanding not to exceed the
sum of (i) U.S.$150,000,000 plus (ii) the Net Cash Proceeds received by
SSCC from any issuance of equity interests of SSCC, so long as such issuance
was consummated for the purpose of financing, and such Net Cash Proceeds were
applied reasonably promptly after receipt thereof to finance, any such
Investment;

 

(m)  Investments
constituting Guarantees permitted under Section 7.01, Investments
permitted under Section 7.05(f) and Investments constituting
Consolidated Capital Expenditures permitted under Section 7.13; and

 

(n)  Investments
under Swap Agreements permitted hereunder.

 

Notwithstanding
anything to the contrary contained herein, SSCC shall not permit more than 15%
of its consolidated revenues for any period of four consecutive fiscal quarters
ending on or after September 30, 2004 or 15% of its consolidated assets as
of the last day of any fiscal quarter ending on or after September 30,
2004 to be generated or held by Domestic Subsidiaries and Canadian Subsidiaries,
in the aggregate, that are not Loan Parties.

 

115

 

SECTION 7.05.  Mergers, Consolidations, Sales of Assets
and Acquisitions.  Merge into or
amalgamate or consolidate with any other Person, or permit any other Person to
merge into or amalgamate or consolidate with it, or sell, transfer, assign,
lease, sublease or otherwise dispose of (in one transaction or in a series of
transactions) all or substantially all of its assets (when taken as a whole in
combination with the other assets and properties of SSCC and the Subsidiaries),
or purchase, lease or otherwise acquire (in one transaction or a series of
transactions) all or any substantial part of the assets of any other Person,
except:

 

(a)  if
at the time thereof and immediately after giving effect thereto no Default or
Event of Default shall have occurred and be continuing, (i) any Domestic
Subsidiary (other than any FinSub) may merge into or consolidate with,
liquidate or dissolve into, or sell, transfer, assign, lease, sublease or
otherwise dispose of all or substantially all of its assets to, (A) SSCE in a
transaction in which SSCE is the surviving corporation and (B) other than with
respect to any Borrower, SSCC in a transaction in which SSCC is the surviving corporation,
(ii) any Domestic Subsidiary (other than SSCE or any FinSub) may merge into or
consolidate with, liquidate or dissolve into, or sell, transfer, assign, lease,
sublease or otherwise dispose of all or substantially all of its assets to, any
wholly owned Domestic Subsidiary (other than SSCE or any Fin Sub) in a
transaction in which the surviving corporation is a wholly owned Domestic
Subsidiary, (iii) any Canadian Subsidiary (other than any FinSub) may merge
into or consolidate or amalgamate with, liquidate or dissolve into, or sell,
transfer, assign, lease, sublease or otherwise dispose of all or substantially
all of its assets to, SSC Canada in a transaction in which SSC Canada is the
surviving corporation, (iv) any Canadian Subsidiary (other than SSC Canada or
any FinSub) may merge into or consolidate or amalgamate with, liquidate or
dissolve into, or sell, transfer, assign, lease, sublease or otherwise dispose
of all or substantially all of its assets to, any wholly owned Canadian
Subsidiary (other than SSC Canada or any FinSub) in a transaction in which the
surviving entity is a wholly owned Canadian Subsidiary; provided that,
in each case, (x) if any Person other than a wholly owned Domestic
Subsidiary or wholly owned Canadian Subsidiary, as the case may be, receives
any consideration, such transaction is also permitted by Section 7.04
and (y) the surviving entity shall, at the time of such merger or
consolidation, be in compliance with the requirements of Section 6.09(b);

 

(b)  if
at the time thereof and immediately after giving effect thereto no Default or
Event of Default shall have occurred and be continuing, any wholly owned
Foreign Subsidiary (other than any Canadian Subsidiary) may merge into,
amalgamate or consolidate with, liquidate or dissolve into, or sell, transfer,
assign, lease, sublease or otherwise dispose of all or substantially all of its
assets to, any other wholly owned Foreign Subsidiary in a transaction in which
the surviving entity is a wholly owned Foreign Subsidiary, provided that
no Person other than a Loan Party or a wholly owned Foreign Subsidiary receives
any consideration;

 

(c)  purchases
of inventory, equipment and real property in the ordinary course of business;

 

116

 

(d)  acquisitions
constituting Consolidated Capital Expenditures permitted by Section 7.13;

 

(e)  Investments
permitted by Section 7.04; and

 

(f)  any
Loan Party may acquire all or substantially all the assets of a Person or line
of business, unit or division of such Person primarily located in the
United States or Canada, or not less than 100% of the equity interests of
a Person (other than directors’ qualifying shares) (in each case referred to
herein as the “Acquired Entity”); provided that (i) the
Acquired Entity shall be in a similar line of business as that of SSCC and the
Subsidiaries, (ii) the acquisition shall not be preceded by, or effected
pursuant to, an unsolicited tender offer or proxy solicitation, (iii) SSCC and
the Borrowers shall comply, and shall cause the Subsidiaries to comply, with
the provisions of Section 6.09 substantially concurrently with the
consummation of such acquisition, (iv) at the time of such transaction
(A) both before and immediately after giving effect thereto, no Event of Default
or Default shall have occurred and be continuing and (B) SSCC shall be in
compliance with the covenants set forth in Sections 7.14 and 7.15
as of the most recently completed period of four consecutive fiscal quarters
for which the financial statements required by Section 6.04(a) or (b)
have been delivered, after giving pro forma effect to such transaction in
accordance with Section 1.05, and (v) with respect to any such
transaction the consideration for which is U.S.$50,000,000 or more, SSCC shall
have delivered a certificate of a Financial Officer confirming compliance with clause
(iv) above, together with reasonably detailed calculations demonstrating
such compliance (any acquisition of an Acquired Entity meeting all of the
criteria set forth in this paragraph (f) being referred to herein as a “Permitted
Acquisition”).

 

SECTION 7.06.  Restricted Payments.  (a)  Declare
or make, directly or indirectly, any Restricted Payment or set aside any amount
for any such purpose.

 

(b)  Notwithstanding
the provisions of paragraph (a) above:

 

(i) SSCC may (A) pay cash dividends to the
holders of the SSCC Series A Preferred Stock in an aggregate amount not to
exceed U.S.$10,000,000 in any fiscal year and (B) pay cash dividends or make
other distributions to the holders of any of its equity interests in an
aggregate amount not to exceed in any fiscal year the least of (x) 25% of
Consolidated Net Income for the immediately preceding fiscal year,
(y) with respect to any fiscal year commencing on or after January 1,
2006, the Borrowers’ Portion of Excess Cash Flow and (z) U.S.$50,000,000, provided,
in each case, that at the time of any such Restricted Payment and immediately
after giving effect thereto, no Default or Event of Default shall have occurred
and be continuing;

 

(ii) SSCC may purchase in the open market
shares of SSCC Common Stock (“MIP Shares”) or options to purchase shares
of SSCC Common

 

117

 

Stock (“MIP Options”), provided that (A) the sum of (x)
the aggregate purchase price of all MIP Shares (whether purchased directly in
the open market or upon the exercise of MIP Options) and (y) the aggregate
purchase price of all MIP Options in any fiscal year shall not exceed
$15,000,000, (B) MIP Shares, including those purchased upon the exercise of MIP
Options, shall be purchased exclusively for subsequent distribution as
additional compensation to employees of SSCC or any Subsidiary pursuant to such
Person’s management incentive program, (C) SSCC shall not knowingly purchase
any MIP Shares from any of its Affiliates (acting as principal in such
transaction) and (D) at the time of any such purchase and immediately after
giving effect thereto, no Default or Event of Default shall have occurred and
be continuing;

 

(iii) SSCC may (A) exchange the SSCC Series A
Preferred Stock for the SSCC Convertible Subordinated Exchange Debentures at an
exchange rate of $25.00 principal amount of such debentures for each share of
SSCC Series A Preferred Stock and (B) convert any shares of SSCC Series A
Preferred Stock into shares of SSCC Common Stock at the conversion price of
$34.97 per share of SSCC Common Stock, subject to customary anti-dilution
adjustments; and

 

(iv) any purchase or other acquisition for
value by SSCC or a Subsidiary of capital stock of any Subsidiary or redemption
by any Subsidiary of any shares of its capital stock, so long as such purchase,
acquisition or redemption is permitted by Section 7.04.

 

SECTION 7.07.  Transactions with Stockholders and
Affiliates.  Except to the extent
specifically permitted by the terms of this Agreement, directly or indirectly
enter into or permit to exist any transaction (including the purchase, sale,
lease or exchange of any property or the rendering of any service) with any
holder of 10% or more of any class of equity securities of such Person or with
any Affiliate of such Person or of any such holder, on terms that are less
favorable to such Person than those that could be obtained at the time from
Persons that are not such a holder or Affiliate, provided that the
foregoing restriction shall not apply to (a) any transaction between or among
the Loan Parties or any transaction between or among Foreign Subsidiaries
(other than Canadian Subsidiaries), (b) any transaction or series of
transactions between SSCC and any Subsidiary or between the Subsidiaries on a
basis that is not systematically disadvantageous to any Loan Party,
(c) customary fees paid to members of the Board of Directors of SSCC or
any of the Subsidiaries, (d) customary compensation (including salaries
and bonuses) paid to officers and employees of SSCC or any Subsidiary,
(e) management and financial services provided by SSCC or any Subsidiary
to any other Subsidiary or any other entity in which SSCC or such Subsidiary has
Investments to the extent that such services are provided by SSCC or such
Subsidiary in the ordinary course of its business and senior management of such
Person has determined that the providing of such services is in the best
interests of such Person and (f) the transactions contemplated by the
Receivables Program Documents.

 

118

 

SECTION 7.08.  Business.  Engage at any time in any business other than
the businesses engaged in by SSCC or any Subsidiary on the Closing Date and
businesses that are reasonably similar or reasonably related thereto, or are
reasonable extensions thereof.

 

SECTION 7.09.  Limitations on Debt Prepayments.  Optionally prepay, repurchase or redeem or
otherwise optionally defease or segregate funds with respect to (collectively, “prepay”)
any Specified Long-Term Indebtedness; provided, however, that (a)
so long as no Default or Event of Default shall have occurred and be continuing
or would result therefrom, SSCC and any Subsidiary shall be permitted (i) to
prepay up to U.S.$150,000,000 in aggregate principal amount (including any
accrued and unpaid interest and any premium thereon) of any Specified Long-Term
Indebtedness if at the time of any such prepayment and after giving effect
thereto, the Consolidated Leverage Ratio would be less than 5.5 to 1.0, (ii) to
prepay up to U.S.$250,000,000 in aggregate principal amount (including any
accrued and unpaid interest and any premium thereon) of any Callable Senior
Notes if at the time of any such prepayment and after giving effect thereto,
the Consolidated Leverage Ratio would be less than 5.5 to 1.0, and (iii) to
prepay up to U.S.$150,000,000 in aggregate principal amount (including any
accrued and unpaid interest and any premium thereon) of any Callable Senior
Notes if at the time of any such prepayment and after giving effect thereto,
the Consolidated Leverage Ratio would be less than 3.0 to 1.0 and (b) SSCC
and any Subsidiary shall be permitted to refinance any Indebtedness as
otherwise permitted hereunder.

 

SECTION 7.10.  Amendment of Certain Documents.  (a)  Amend,
modify or grant any waiver with respect to any indenture, note or any other
instrument evidencing Indebtedness of SSCC or any Subsidiary in an aggregate
principal amount in excess of U.S.$100,000,000 (other than any such
Indebtedness owed to SSCC or any Subsidiary), if such amendment, modification,
or waiver has the effect of (i) increasing the amounts due in respect of
any such indenture, note or other instrument or any interest rate thereunder,
unless any such increase in amount would be permitted under Section 7.01,
(ii) subjecting any property of SSCC or any Subsidiary to any Lien, other
than Liens permitted under Section 7.02, (iii) shortening the
maturity or weighted average life of any such Indebtedness or
(iv) creating or changing covenants, events of default and other terms and
conditions such that the covenants, events of default and other terms and
conditions become materially more adverse, when taken as a whole, to the Lenders.

 

(b)  Cause
or suffer to exist any amendment, restatement, supplement or other modification
to the certificate of incorporation (including any certificate of designation
with respect to any preferred stock) or by-laws of SSCC or any Subsidiary
without the prior written consent of the Required Lenders, unless such
amendment, restatement, supplement or modification is not materially adverse to
the interests of the Lenders hereunder or under the other Loan Documents.

 

(c)  Permit,
cause or suffer to exist (i) any direct or indirect amendment, supplement,
waiver or other modification to any of the Receivables Program Documents set
forth in Schedule 1.01(e) and any of the other material Receivables
Program Documents, unless such amendment, supplement, waiver or 

 

119

 

modification is not materially
adverse, when taken as a whole, to the interests of the Lenders under the Loan
Documents or (ii) any refinancing or replacement of the Receivables Program
Documents, provided that (A) SSCC or any Subsidiary may refinance
or replace the Receivables Program Documents so long as the terms of the new
Receivables Program Documents are reasonably acceptable to the Senior Agents,
(ii) such new Receivables Program shall continue to be non-recourse to
SSCC and the Subsidiaries, except that SSCE may continue to provide operational
support to SMBI on the terms no more onerous to SSCE than the terms set forth
in the Operations Support Agreement and (iii) any Liens on the assets of
SSCC and the Subsidiaries pursuant to the new Receivables Program are limited
to the Program Receivables and any returned inventory and intangible assets
related thereto.

 

SECTION 7.11.  Limitation on Dispositions of Stock of
Subsidiaries.  Directly or indirectly
sell or otherwise dispose of, or permit any of the Loan Parties to issue to any
other Person (other than to any other Loan Party), any shares of capital stock
or other equity securities of (or warrants, rights or options to acquire shares
or other equity securities of) any of the Loan Parties, except issuance to
qualified directors if and to the extent required by applicable law, provided
that nothing in this Section 7.11 shall prohibit any disposition
permitted by Sections 7.05 and 7.16 if such sale is
structured as the sale of stock or other equity interests.

 

SECTION 7.12.  Restrictions on Ability of Subsidiaries to
Pay Dividends.  Permit any Subsidiary
to, directly or indirectly, voluntarily create or otherwise voluntarily cause
or suffer to exist or become effective any encumbrance or restriction on the
ability of any Subsidiary to (a) pay dividends or make any other
distributions on its capital stock or any other interest or (b) make or
repay loans or advances to any Loan Party, except for encumbrances or
restrictions under (i) this Agreement and the other Loan Documents,
(ii) the indentures governing the Senior Notes (or any refinancing thereof
pursuant to Section 7.01(e)) or any other indenture or other
document governing Indebtedness permitted hereby so long as the encumbrances
and restrictions thereunder are no more onerous to any Subsidiary than those
contained in the indentures governing the Senior Notes (or any refinancings
thereof), (iii) with respect to any FinSub, the Receivables Program
Documents and, (iv) any agreements identified on Schedule 7.12.

 

SECTION 7.13.  Capital Expenditures.  Incur Consolidated Capital Expenditures in
any fiscal year in an aggregate amount in excess of U.S.$400,000,000; provided,
however, that such amount in respect of any fiscal year shall be
increased by the sum of (a) an amount equal to the Borrowers’ Portion of
Excess Cash Flow and (b) the amount (if greater than zero) equal to (i)
U.S.$400,000,000 minus (ii) the amount of Consolidated Capital
Expenditures actually made in the immediately preceding fiscal year; provided,
however, that amounts so available under this sentence in any fiscal
year or years that are not so expended, up to a maximum of U.S.$100,000,000 on
a cumulative basis, shall be available for any subsequent fiscal year, and the
amount of Consolidated Capital Expenditures made in any fiscal year shall first
be applied against the U.S.$400,000,000 amount permitted for such year and
thereafter applied to the amount available from prior years.  For purposes of this Section 7.13,
Cluster Expenditures shall be deemed not to be Consolidated Capital
Expenditures, and SSCC and the Subsidiaries

 

120

 

shall be
permitted to make Cluster Expenditures notwithstanding the foregoing
limitations on Consolidated Capital Expenditures.

 

SECTION 7.14.  Consolidated Senior Secured Leverage
Ratio.  Permit the Consolidated
Senior Secured Leverage Ratio (a) as of December 31, 2004 or March 31,
2005, to exceed 3.25 to 1.00, or (b) as of the last day of any fiscal quarter
thereafter, to exceed 3.00 to 1.00.

 

SECTION 7.15.  Interest Coverage Ratio.  Permit the Interest Coverage Ratio (a) for
the period of four consecutive fiscal quarters ending on December 31, 2004
or March 31, 2005, to be less than 1.75 to 1.00 or (b) for any period of
four consecutive fiscal quarters thereafter, to be less than 2.00 to 1.00.

 

SECTION 7.16.  Disposition of Collateral and Other
Assets.  (a)  Except for the sale of Program Receivables as
permitted by the Receivables Program Documents and any transfer or disposition
permitted by paragraph (b) below, sell, lease, assign, transfer or
otherwise dispose of any asset or assets, in a single transaction or a series
of related transactions, having a fair market value in excess of
U.S.$10,000,000, unless (i) fair market value is received for such asset
(such fair market value to be determined by the Board of Directors of SSCC or
any applicable Subsidiary in the exercise of its reasonable judgment in the
case of any asset or assets with a fair market value in excess of
U.S.$100,000,000), (ii) except in the case of any Asset Exchange, if the
fair market value of such asset or assets is in excess of U.S.$50,000,000, at
least 75% of the consideration received by SSCC and the Subsidiaries for such
asset or assets shall be in cash, cash equivalents and readily marketable
securities and (iii) except in the case of any Asset Exchange, any
non-cash consideration shall consist of debt obligations of the purchaser, provided
that the foregoing shall not restrict SSCC or any Subsidiary from receiving
debt obligations of the purchaser in an aggregate principal amount not in
excess of U.S.$50,000,000 in connection with any single transaction or series
of related transactions.

 

(b)  Notwithstanding anything to the contrary in this
Agreement, except for the sale of Program Receivables as permitted by the
Receivables Program Documents, SSCC shall not transfer any of its assets to any
Subsidiary and none of the Subsidiaries shall transfer any of its assets to any
other Subsidiary unless (i) in the case of any asset or assets
constituting Collateral, such asset or assets is transferred to a Loan Party
and the Collateral Agent is satisfied that the Liens created under the Security
Documents on such asset or assets shall be in full force and effect, or
(ii) in the case of any asset or assets not constituting Collateral, such
transfer is permitted as an Investment under Section 7.04.

 

SECTION 7.17.  Fiscal Year.  Cause the fiscal year of SSCC or any Borrower
to end on a date other than December 31.

 

121

 

ARTICLE VIII

 

Events of Default

 

In case of the happening of any of the following events (each, an “Event
of Default”):

 

(a)  any representation or warranty made or deemed
made in any Loan Document, or any representation, warranty, statement or
information contained in any report, certificate, financial statement or other
instrument furnished pursuant to any Loan Document, shall prove to have been
false or misleading in any material respect when so made, deemed made or
furnished;

 

(b)  default shall be made in the payment of any
principal of any Loan or LC Disbursement when and as the same shall become due
and payable, whether at the due date thereof or at a date fixed for prepayment
thereof or by acceleration thereof or otherwise;

 

(c)  default shall be made in the payment of any
interest on any Loan or any Fee or any other amount (other than an amount
referred to in paragraph (b) above) due under any Loan Document,
when and as the same shall become due and payable, and such default shall
continue unremedied for a period of three Business Days, in the case of payment
of any such interest or Fee, or 10 Business Days in the case of payment of any
such other amount;

 

(d)  default shall be made in the due observance
or performance by SSCC or either Borrower of any covenant, condition or
agreement contained in Section 6.01 (with respect to SSCC or any
Borrower), 6.05(a), 6.08 or in Article VII;

 

(e)  default shall be made in the due observance
or performance by any Loan Party or any of their respective Subsidiaries of any
covenant, condition or agreement contained in any Loan Document (other than
those defaults specified in paragraph (b), (c) or (d)
above) and such default shall continue unremedied for a period of 30 days
after written notice thereof from the Administrative Agent or any Lender to the
Borrowers;

 

(f)  SSCC or any Subsidiary shall (i) fail to
pay any principal or interest, regardless of amount, due in respect of any
Indebtedness in a principal amount in excess of U.S.$30,000,000, when and as
the same shall become due and payable (after giving effect to any applicable
grace period), or (ii) fail to observe or perform any other term,
covenant, condition or agreement contained in any agreement or instrument
evidencing or governing any such Indebtedness (after giving effect to any
applicable grace period), if the effect of any failure referred to in this clause (ii) is
to cause, or to permit the holder or holders of such Indebtedness or a trustee
on its or their behalf to cause, such Indebtedness to become due prior to its
stated maturity, provided that this paragraph (f) shall not

 

122

 

apply to secured Indebtedness
that becomes due as a result of the voluntary sale or transfer of the property
or asset securing such Indebtedness;

 

(g)  an involuntary proceeding shall be commenced
or an involuntary petition shall be filed in a court of competent jurisdiction
seeking (i) relief in respect of SSCC, either Borrower or any Material
Subsidiary, or of a substantial part of the property or assets of any such
Person, under any Insolvency Law, (ii) the appointment of a receiver,
interim receiver, receiver and manager, trustee, custodian, sequestrator, conservator
or similar official for any such Person or for a substantial part of the
property or assets of any such Person or (iii) the winding-up or
liquidation of any such Person; and such proceeding or petition shall continue
undismissed for 60 days or an order or decree approving or ordering any of
the foregoing shall be entered;

 

(h)  SSCC, either Borrower or any Material
Subsidiary shall (i) voluntarily commence any proceeding or file any
petition seeking relief under any Insolvency Law, (ii) consent to the
institution of, or fail to contest in a timely and appropriate manner, any
proceeding or the filing of any petition described in paragraph (g)
above, (iii) apply for or consent to the appointment of a receiver,
interim receiver, receiver and manager, trustee, custodian, sequestrator,
conservator or similar official for any such Person or for a substantial part
of the property or assets of any such Person, (iv) file an answer
admitting the material allegations of a petition filed against it in any such
proceeding, (v) make a general assignment for the benefit of creditors,
(vi) become unable, admit in writing its inability or fail generally to
pay its debts as they become due or (vii) take any action for the purpose
of effecting any of the foregoing;

 

(i)  one or more judgments for the payment of
money, individually or in the aggregate, in an amount in excess of
U.S.$30,000,000 (in each case to the extent not adequately covered by insurance
proceeds as to which the insurance company has acknowledged coverage pursuant
to a writing reasonably satisfactory to the Senior Agents), shall be rendered
against SSCC or any of the Subsidiaries or any combination thereof and the same
shall remain undischarged for a period of 30 consecutive days during which
execution shall not be effectively stayed, vacated, discharged or satisfied;

 

(j)  an ERISA Event shall have occurred that, when
taken together with all other ERISA Events that have occurred, could reasonably
be expected to result in liability of SSCC and its Subsidiaries in an aggregate
amount exceeding U.S.$30,000,000;

 

(k)  there shall have occurred a Change in Control
or SSCC or any Subsidiary shall make any mandatory prepayment, repurchase or
redemption or make any offer to make any such mandatory prepayment, repurchase
or redemption of any Indebtedness in an aggregate outstanding principal amount
in excess of U.S.$30,000,000 on account of any “Change of Control” (however
designated);

 

123

 

(l)  any Lien purported to be created by any
Security Document shall cease to be, or shall be asserted by any Loan Party not
to be, a valid, perfected (or, in the case of the Province of Quebec,
published), first priority (or, in the case of the Province of Quebec,
first-ranking) (except as otherwise expressly provided in this Agreement or
such Security Document) Lien on any Collateral with a fair market value or book
value (whichever is greater) in excess, individually or in the aggregate, of
U.S.$100,000,000, except to the extent that any such loss of perfection,
priority or rank results from the failure of the Collateral Agent to maintain
possession of certificates representing securities pledged under the Security
Documents or otherwise take any action within its control (including the filing
of Uniform Commercial Code continuation statements or similar filings or
registrations under the applicable laws of any other jurisdiction);

 

(m)  any Loan Document shall not be for any
reason, or shall be asserted by the Loan Party (except as otherwise expressly
provided in this Agreement or such Loan Document) not to be, in full force and
effect and enforceable in all material respects in accordance with its terms;
or

 

(n)  the Loan Documents Obligations shall cease to
constitute, or shall be asserted by any Loan Party (except as otherwise
expressly provided in this Agreement or such Loan Document) not to constitute,
senior indebtedness under the subordination provisions of any subordinated
Indebtedness, or any such subordination provisions shall be invalidated or
otherwise cease to be a legal, valid and binding obligation of the parties
thereto, enforceable in accordance with its terms;

 

then, and in every such event (other than an event with respect to SSCC
or either Borrower described in paragraph (g) or (h) above),
and at any time thereafter during the continuance of such event, the
Administrative Agent may and, at the request of the Required Lenders, shall, by
notice to the Borrowers, take any of or all the following actions, at the same
or different times:  (i) terminate
forthwith the Commitments, (ii) declare the Loans then outstanding to be
forthwith due and payable, in whole or in part, whereupon the principal of the
Loans so declared to be due and payable, together with accrued interest thereon
and any unpaid accrued Fees and all other liabilities of the Loan Parties
accrued hereunder and under any other Loan Document, shall become forthwith due
and payable, without presentment, demand, protest or any other notice of any
kind, all of which are hereby expressly waived by each Loan Party, anything
contained herein or in any other Loan Document to the contrary notwithstanding,
and (iii) exercise any remedies available under any Loan Document or
otherwise; and in any event with respect to SSCC or either Borrower described
in paragraph (g) or (h) above, the Commitments shall
automatically terminate and the principal of the Loans then outstanding,
together with accrued interest thereon and any unpaid accrued Fees and all
other liabilities of the Loan Parties accrued hereunder and under any other
Loan Document, shall automatically become due and payable, without presentment,
demand, protest or any other notice of any kind, all of which are hereby
expressly waived by each Loan Party, anything contained herein or in any other
Loan Document to the contrary notwithstanding.

 

124

 

ARTICLE IX

 

The Agents

 

In order to expedite the transactions contemplated by this Agreement,
(a) DB is hereby irrevocably appointed to act as a Senior Agent, the
Administrative Agent and the Collateral Agent for the Facing Agents and the
Lenders, (b) DB Canada is hereby irrevocably appointed to act as the
Canadian Administrative Agent for the Revolving (Canadian) Facility Facing Agent
and SSC Canada Lenders and (c) JPMCB is hereby irrevocably appointed to
act as a Senior Agent for the Facing Agents and the Lenders and as the Deposit
Account Agent for the Deposit Funded Facility Facing Agent and the Deposit
Funded Lenders.  Each of the Lenders and
the Facing Agents hereby irrevocably authorizes each Agent and the Trustee to
take such actions on its behalf and to exercise such powers as are delegated to
such Agent or to the Trustee by the terms and provisions hereof and of the
other Loan Documents, together with such actions and powers as are reasonably
incidental thereto.  Without limiting the
foregoing, each of the Collateral Agent and the Trustee is expressly authorized
to execute any and all documents with respect to the Collateral and the Program
Receivables and the rights of the Lenders and the Facing Agents with respect
thereto and to act as Collateral Agent on behalf of the Lenders and the Facing
Agents, in each case as contemplated by and in accordance with the terms and
provisions of this Agreement and the Security Documents.

 

For greater certainty and without limiting the powers of the Collateral
Agent herein and for the purposes of constituting security on any of the
Collateral, present or future, of SSC Canada or any other Canadian Subsidiary
located or deemed to be located in the Province of Quebec, as security for the
due payment of the Bonds, it is hereby agreed and acknowledged that the Trustee
is, for the purposes of holding the Hypothecs granted pursuant to the laws of the
Province of Quebec, appointed the holder of an irrevocable power of attorney
for all present and future holders of the Bonds by SSC Canada, the other
Canadian Subsidiaries, the Collateral Agent (including in its capacity as
holder of the Bonds), the SSC Canada Lenders, the Canadian Administrative
Agent, the Senior Agents, the Revolving (Canadian) Facility Facing Agent and
the other Beneficiaries (as defined in the Bond Pledge Agreements (the “Other
Beneficiaries”)).  By the execution
of any Assignment and Acceptance or by its appointment, as the case may be, any
future SSC Canada Lender (including any such Lender that is an Incremental
Lender), Canadian Administrative Agent, Collateral Agent, Senior Agent,
Revolving (Canadian) Facility Facing Agent and Other Beneficiaries shall be
deemed to ratify the powers of attorney approved, ratified, confirmed and
granted to the Trustee hereunder. 
Furthermore, the Collateral Agent hereby agrees to act in the capacity
of the collateral agent and depositary of the Bonds for the benefit of all
present and future SSC Canada Lenders (including any such Lender that is an
Incremental Lender), Canadian Administrative Agent, Senior Agent, Revolving
(Canadian) Facility Facing Agent and Other Beneficiaries.  Any future SSC Canada Lenders (including any
such Lender that is an Incremental Lender), Canadian Administrative Agent,
Senior Agent, Revolving (Canadian) Facility Facing Agent and Other Beneficiary
shall be deemed to reconfirm the above mandate of the Collateral Agent.  SSC Canada and the other Canadian
Subsidiaries, the Senior Agents, the Revolving (Canadian) Facility Facing
Agent, the

 

125

 

Collateral Agent, the Canadian Administrative
Agent, the SSC Canada Lenders and the Other Beneficiaries agree that
(a) notwithstanding the provisions of Section 32 of the Act
Respecting Special Powers of Legal Persons (Quebec), the Trustee may acquire
any title or indebtedness secured by the Hypothecs, and that (b) the Bonds
constitute “titles of indebtedness” within the meaning of such term in Article 2692
of the Civil Code of Quebec.  This
paragraph shall be governed by, and construed in accordance with, the law of
the Province of Quebec and the federal laws of Canada applicable therein, excluding
the choice of law and conflicts of laws rules thereof.

 

None of the Agents shall be liable as such for any action taken or
omitted by any or them with the consent or at the request of the Required
Lenders (or such other number of percentage of the Lenders as shall be
necessary under the circumstances as provided in Section 11.08) or
in the absence of its own gross negligence or willful misconduct, or be
responsible for any statement, warranty or representation in any Loan Document
or the contents of any document delivered in connection herewith, or be
required to ascertain or to make any inquiry concerning the performance or
observance by the Loan Parties of any of the terms, conditions, covenants or
agreements contained in any Loan Document. 
None of the Agents shall be deemed not to have knowledge of any Default
unless and until written notice thereof is given to such Agent by SSCC, either
Borrower or a Lender.  None of the Agents
shall be responsible to the Lenders or the Facing Agents for the due execution,
genuineness, validity, enforceability or effectiveness of this Agreement, any
other Loan Document or any other instruments or agreements.  Each Agent shall in all cases be fully
protected in acting, or refraining from acting, in accordance with written
instructions signed by the Required Lenders (and the Facing Agents, with
respect to Letters of Credit) and, except as otherwise specifically provided
herein, such instructions and any action or inaction pursuant thereto shall be
binding on all Lenders and Facing Agents. 
Each Agent shall be entitled to rely on any instrument or document
believed by them in good faith to be genuine and correct and to have been
signed or sent by the proper Person or Persons. 
Each Agent shall also be entitled to rely on any statement made to it
orally or by telephone and believed by it to be made by the proper Person, and
shall not incur any liability for relying thereon.  None of the Agents or any of their respective
directors, officers, employees or agents shall have any responsibility to the
Loan Parties on account of the failure of or delay in performance or breach by
any Lender or any Facing Agent of any of its obligations hereunder or to any
Lender or any Facing Agent on account of the failure of or delay in performance
or breach by any other Lender, any other Facing Agent or any Loan Party of any
of their respective obligations hereunder or under any other Loan Document or
in connection herewith or therewith. 
Each Agent may execute any and all duties hereunder by or through agents
or employees (and the exculpatory provisions of this Article IX
shall apply to any such agent or employee) and shall be entitled to rely upon
the advice of legal counsel with respect to all matters arising hereunder and
shall not be liable for any action taken or suffered in good faith by any of
them in accordance with the advice of such counsel.

 

The Lenders and the Facing Agents hereby acknowledge that (a) none
of the Agents shall be under any duty to take any discretionary action or exercise
any discretionary powers, except discretionary rights and powers expressly
contemplated by

 

126

 

the Loan Documents that such Agent is
required to exercise in writing by the Required Lenders (or such other number
or percentage of the Lenders as shall be necessary under the circumstances as
provided in Section 11.08), and (b) except as expressly set forth
in the Loan Documents, none of the Agents shall have any duty to disclose, or
shall be liable for the failure to disclose, any information relating to SSCC
or any of the Subsidiaries that is communicated to or obtained by the Person
serving as Agent or any of its Affiliates in any capacity.

 

Subject to the appointment and acceptance of a successor Agent as
provided below, each of the Administrative Agent, the Canadian Administrative
Agent, the Collateral Agent and the Deposit Account Agent may resign at any
time by notifying the other Agents, the Lenders, the Facing Agents and the
Borrowers.  Upon any such resignation,
the Required Lenders (or (a) in the case of the resignation of the Canadian
Administrative Agent, a majority in interest of the SSC Canada Lenders and (b)
in the case of the resignation of the Deposit Account Agent, a majority in
interest of the Deposit Funded Lenders) shall have the right to appoint a
Lender as the successor, which successor agent shall, unless an Event of
Default under paragraph (b), (c), (g) or (h) of Article VIII
shall have occurred and be continuing, be subject to approval by SSCE (not to
be unreasonably withheld or delayed); provided that any successor
Canadian Administrative Agent shall not be a non-resident of Canada or shall be
deemed to be resident in Canada for the purposes of Part XIII of the ITA.  If no successor shall have been so appointed
by the Required Lenders, the SSC Canada Lenders or the Deposit Funded Lenders,
as the case may be, and shall have accepted such appointment within
30 days after the retiring agent gives notice of its resignation, then the
retiring agent may, on behalf of the Lenders and the Facing Agents, appoint a
successor agent, which shall be a bank with an office in New York, New York
(or, in the case of the Canadian Administrative Agent, Toronto, Ontario),
having a combined capital and surplus of at least U.S.$500,000,000 or an
Affiliate of any such bank and, in the case of appointing of the Canadian
Administrative Agent, shall not be a non-resident of Canada or shall be deemed
to be Resident in Canada for the purposes of Part XIII of the ITA.  Upon the acceptance of any appointment as
Agent hereunder by a successor bank, such successor shall succeed to and become
vested with all the rights, powers, privileges and duties of the retiring Agent
and the retiring Agent shall be discharged from its duties and obligations
hereunder.  Each of the Senior Agents may
resign at any time by notifying the other Agents, the Lenders, the Facing
Agents and the Borrowers.  Upon any such
resignation, any provision herein or in any other Loan Document requiring the
consent of or notice to the Senior Agents shall be deemed to require the
consent of or notice to only the remaining Senior Agent or, in the case of
resignation of both Senior Agents, the Administrative Agent.  After any Agent’s resignation hereunder, the
provisions of this Article IX and Section 11.05 shall
continue in effect for its benefit in respect of any actions taken or omitted
to be taken by it while it was acting as Agent.

 

With respect to the Loans made by it hereunder, each Agent, in its individual
capacity and not as Agent, shall have the same rights and powers as any other
Lender and may exercise the same as though it were not an Agent and each Agent
and its Affiliates may accept deposits from, lend money to and generally engage
in any kind of

 

127

 

business with the Loan Parties or any of
their respective Subsidiaries or other Affiliates as if it were not an Agent.

 

Each Lender agrees (a) to reimburse each Agent and each Facing
Agent, on demand, in the amount of such Lender’s pro rata share (based on its
Commitments hereunder (provided that (x) in the case of Term Loans
or (y) in the event that such Commitments shall have expired or been
terminated, such pro rata share shall be based on the respective principal
amounts of the outstanding Loans (other than Swingline Loans) and/or
participations in LC Disbursements and Swingline Loans, as applicable)) of any
expenses incurred for the benefit of the Lenders by such Agent or such Facing
Agent, including fees, disbursements and other charges of counsel and
compensation of agents paid for services rendered on behalf of the Lenders,
that shall not have been reimbursed by the Loan Parties and (b) to
indemnify and hold harmless each Agent and each Facing Agent and any of their
respective directors, officers, employees or agents, on demand, in the amount
of such pro rata share, from and against any and all liabilities, taxes,
obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses
or disbursements of any kind or nature whatsoever that may be imposed on,
incurred by or asserted against it in its capacity as an Agent or a Facing
Agent, as the case may be, or any of them in any way relating to or arising out
of this Agreement or any other Loan Document or any action taken or omitted by
it or any of them under this Agreement or any other Loan Document, to the
extent the same shall not have been reimbursed by the Loan Parties; provided,
however, that no Lender shall be liable to any Agent or any Facing Agent
for any portion of such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements resulting from the
gross negligence or willful misconduct of such Agent or such Facing Agent, as
the case may be.

 

Each Lender acknowledges that it has, independently and without
reliance upon any Agent, any other Lender or any Facing Agent 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 any Agent, any other Lender or any
Facing Agent 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 or any other Loan Document,
any related agreement or any document furnished hereunder or thereunder.

 

Each Agent agrees to act as a contractual representative upon the
express conditions contained in this Article IX.  Notwithstanding the use of the defined term “Senior
Agent”, “Administrative Agent”, “Canadian Administrative Agent”, “Collateral
Agent” or “Deposit Account Agent”, it is expressly understood and agreed that
no Agent shall have any fiduciary or other implied duties to any Lender, any
Facing Agent or any other Agent by reason of this Agreement or any other Loan
Document, regardless of whether a Default has occurred and is continuing, and that
each Agent is merely acting as the contractual representative of the applicable
Lenders and Facing Agents with only those duties as are expressly set forth in
this Agreement and the other Loan Documents. 
In such capacity of a contractual representative, the Agents
(a) hereby assume no

 

128

 

fiduciary duties to any of the Lenders or
Facing Agents, (b) is each a “representative “ of the Lenders and Facing Agents
within the meaning of the term “secured party” as defined in the New York
Uniform Commercial Code and (c) is acting as an independent contractor, the
rights and duties of which are limited to those expressly set forth in this
Agreement and the other Loan Documents. 
Each of the Lenders, Facing Agents and the Agents hereby agrees to
assert no claim against any Agent on any agency theory or any other theory of
liability for breach of fiduciary duty, all of which claims each Lender, each
Facing Agent and each other Agent hereby waives.

 

No Person named on the cover page to this Agreement as a joint
bookrunner, co-lead arranger, syndication agent or co-documentation agent shall
have any duties or responsibilities under this Agreement or any other Loan
Document in its capacity as such.

 

ARTICLE X

 

Collection Allocation Mechanism

 

SECTION 10.01.  Implementation of CAM.  (a)  On
the CAM Exchange Date, the Lenders shall automatically and without further act
(and without regard to the provisions of Section 11.04) be deemed
to have exchanged interests in the Credit Facilities such that in lieu of the
interest of each Lender in each Credit Facility in which it shall participate
as of such date (including such Lender’s interest in the Designated Obligations
of each Loan Party in respect of each such Credit Facility), such Lender shall
hold an interest in every one of the Credit Facilities (including the
Designated Obligations of each Loan Party in respect of each such Credit
Facility), whether or not such Lender shall previously have participated
therein, equal to such Lender’s CAM Percentage thereof.  Each Lender and each Borrower hereby consents
and agrees to the CAM Exchange, and each Lender agrees that the CAM Exchange
shall be binding upon its successors and assigns and any Person that acquires a
participation in its interests in any Credit Facility.  Each Borrower agrees from time to time to
execute and deliver to the Agents all instruments and documents as the Senior
Agents shall reasonably request to evidence and confirm the respective
interests of the Lenders after giving effect to the CAM Exchange.

 

(b)  As a result of the CAM Exchange, upon and
after the CAM Exchange Date, each payment received by the Administrative Agent
or the Collateral Agent pursuant to any Loan Document in respect of the
Designated Obligations, and each distribution made by the Collateral Agent
pursuant to any Security Document in respect of the Designated Obligations,
shall be distributed to the Lenders pro rata in accordance with their
respective CAM Percentages.  Any direct
payment received by a Lender upon or after the CAM Exchange Date, including by
way of setoff, in respect of a Designated Obligation shall be paid over to the
Administrative Agent for distribution to the Lenders in accordance herewith.

 

129

 

SECTION 10.02.  Letters of Credit.  (a)  In
the event that on the CAM Exchange Date any Letter of Credit (other than any
Deposit Funded Facility Letter of Credit) shall be outstanding and undrawn in
whole or in part, or any amount drawn under any such Letter of Credit shall not
have been reimbursed by the applicable Borrower or with the proceeds of a
Revolving Credit Borrowing, Swingline Loan or Revolving (Canadian) Credit
Borrowing, as the case may be, each Lender having, on such date and prior to
giving effect to the CAM Exchange, a Revolving Facility LC Exposure or
Revolving (Canadian) Facility LC Exposure, as the case may be, with respect to
such Letter of Credit shall promptly pay over to the Administrative Agent, in
immediately available funds in the same currency as such Letter of Credit, in
the case of any undrawn amount, and in U.S. Dollars, in the case of any
unreimbursed amount, an amount equal to such Lender’s Applicable Percentage of
such undrawn face amount or (to the extent it has not already done so) such
unreimbursed drawing, as the case may be, together with interest thereon from
the CAM Exchange Date to the date on which such amount shall be paid to the
Administrative Agent at the rate that would be applicable at the time to an ABR
Revolving Loan or Canadian Prime Rate Loan, as the case may be, in a principal
amount equal to such amount.  The
Administrative Agent shall establish a separate account or accounts for each
Lender (each, an “LC Reserve Account”) for the amounts received with
respect to each such Letter of Credit pursuant to the preceding sentence.  The Administrative Agent shall deposit in
each Lender’s LC Reserve Account such Lender’s CAM Percentage of the amounts
received from the Lenders as provided above. 
The Administrative Agent shall have sole dominion and control over each
LC Reserve Account, and the amounts deposited in each LC Reserve Account shall
be held in such LC Reserve Account until withdrawn as provided in paragraph (b),
(c), (d) or (e) below. 
The Administrative Agent shall maintain records enabling it to determine
the amounts paid over to it and deposited in the LC Reserve Accounts in respect
of each Letter of Credit and the amounts on deposit in respect of each Letter
of Credit attributable to each Lender’s CAM Percentage.  The amounts held in each Lender’s LC Reserve
Account shall be held as a reserve against the outstanding Revolving Facility
LC Exposure or Revolving (Canadian) Facility LC Exposure, as the case may be,
shall be the property of such Lender, shall not constitute Loans to or give
rise to any claim of or against any Loan Party and shall not give rise to any
obligation on the part of either Borrower to pay interest to such Lender, it
being agreed that the reimbursement obligations in respect of Letters of Credit
shall arise only at such times as drawings are made thereunder, as provided in Article III.

 

(b)  In the event that on or after the CAM
Exchange Date any drawing shall be made in respect of a Letter of Credit (other
than any Deposit Funded Facility Letter of Credit), the Administrative Agent
shall, at the request of the applicable Facing Agent, withdraw from the LC
Reserve Account of each Lender any amounts, up to the amount of such Lender’s
CAM Percentage of such drawing, deposited in respect of such Letter of Credit
and remaining on deposit and deliver such amounts to the applicable Facing
Agent in satisfaction of the reimbursement obligations of the Lenders under Section 3.05
(but not of either Borrower under Section 3.05).  In the event any Lender shall default on its
obligation to pay over any amount to the Administrative Agent in respect of any
Letter of Credit (other than any Deposit Funded Facility Letter of Credit) as

 

130

 

provided in this Section 10.02,
the applicable Facing Agent shall, in the event of a drawing thereunder, have a
claim against such Lender to the same extent as if such Lender had defaulted on
its obligations under Section 3.05, but shall have no claim against
any other Lender in respect of such defaulted amount, notwithstanding the
exchange of interests in the applicable Borrower’s reimbursement obligations
pursuant Section 10.01.  Each
other Lender shall have a claim against such defaulting Lender for any damages
sustained by it as a result of such default, including, in the event such
Letter of Credit shall expire undrawn, its CAM Percentage of the defaulted
amount.

 

(c)  In the event that after the CAM Exchange Date
any Letter of Credit (other than any Deposit Funded Facility Letter of Credit)
shall expire undrawn, the Administrative Agent shall withdraw from the LC
Reserve Account of each Lender the amount remaining on deposit therein in
respect of such Letter of Credit and distribute such amount to such Lender.

 

(d)  With the prior written approval of the
Administrative Agent and the applicable Facing Agent (not to be unreasonably
withheld), any Lender may withdraw the amount held in its LC Reserve Account in
respect of the undrawn amount of any Letter of Credit.  Any Lender making such a withdrawal shall be
unconditionally obligated, in the event there shall subsequently be a drawing
under such Letter of Credit, to pay over to the Administrative Agent, for the
account of the applicable Facing Agent, on demand, its CAM Percentage of such
drawing.

 

(e)  Pending the withdrawal by any Lender of any
amounts from its LC Reserve Account as contemplated by the above paragraphs,
the Administrative Agent will, at the direction of such Lender and subject to
such rules as the Administrative Agent may prescribe for the avoidance of
inconvenience, invest such amounts in Permitted Investments.  Each Lender which has not withdrawn its CAM
Percentage of amounts in its LC Reserve Account as provided in paragraph (d)
above shall have the right, at intervals reasonably specified by the
Administrative Agent, to withdraw the earnings on investments so made by the
Administrative Agent with amounts in its LC Reserve Account and to retain such
earnings for its own account.

 

(f)  In
the event that on or after the CAM Exchange Date any drawing shall be made in
respect of a Deposit Funded Facility Letter of Credit and shall not be
reimbursed by SSCE when due, then (i) the Deposit Account Agent shall
apply the Deposit of each Deposit Funded Lender (determined prior to giving
effect to the CAM Exchange) to pay to the Deposit Funded Facility Facing Agent
such Lender’s Applicable Percentage (determined prior to giving effect to the
CAM Exchange) of such drawing in satisfaction of the reimbursement obligations
of the Deposit Funded Lenders (but not of SSCE) under Section 3.05
and (ii) the Administrative Agent shall redetermine the CAM Percentages after
giving effect to such drawing and the reimbursement thereof by the applicable
Deposit Funded Lenders.  Each such
redetermination shall be binding on each of the Lenders and their successors
and assigns and shall be conclusive, absent manifest error.  For the avoidance of doubt, the provisions of
Section 2.01(d) shall be in full force

 

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and
effect with respect to the Deposit Account and the Deposits notwithstanding the
occurrence of the CAM Exchange.

 

SECTION 10.03.  Conversion.  In the event the CAM Exchange Date shall
occur, Obligations owed by the Loan Parties denominated in any currency other
than U.S. Dollars (other than, for the avoidance of doubt, obligations in
respect of undrawn Revolving (Canadian) Facility Letters of Credit denominated
in Canadian Dollars) shall, automatically and with no further act required, be
converted to obligations of the same Loan Parties denominated in U.S.
Dollars.  Such conversion shall be
effected based upon the Exchange Rates in effect with respect to the relevant
currencies on the CAM Exchange Date.  On
and after any such conversion, all amounts accruing and owed to any Lender in
respect of its Obligations shall accrue and be payable in U.S. Dollars at the
rates otherwise applicable hereunder (and, in the case of interest on Loans, at
the default rate applicable to ABR Loans hereunder).  Notwithstanding the foregoing provisions of
this Section 10.03, any Lender may, by notice to the Borrowers and
the Administrative Agent prior to the CAM Exchange Date, elect not to have the
provisions of this Section 10.03 apply with respect to all
Obligations owed to such Lender immediately following the CAM Exchange Date,
and, if such notice is given, all Obligations owed to such Lender immediately
following the CAM Exchange Date shall remain designated in their original currencies.

 

ARTICLE XI

 

Miscellaneous

 

SECTION 11.01.  Notices.  Except as otherwise expressly permitted
herein, notices and other communications provided for herein shall be in
writing and shall be delivered by hand or overnight courier service, mailed or
sent by fax, as follows:

 

(a)  if to SSCC, SSCE or SSC Canada, to it at 8182
Maryland Avenue, St. Louis, MO 63105, Attention of Treasurer (Fax No. (314) 746-1281);

 

(b)  if to JPMCB, as Lender, Senior Agent, Deposit
Account Agent or Deposit Funded Facility Facing Agent, to it at 270 Park
Avenue, New York, NY 10017, Attention of Peter S. Predun (Fax No.
(212) 270-4724);

 

(c)  if to DB, as Lender, Senior Agent,
Administrative Agent, Collateral Agent, Swingline Lender or Revolving Facility
Facing Agent, to it at 90 Hudson Street, 1st Floor, Jersey City, NJ 07302,
Attention of Helaine Griffin-Williams (Fax No. (201) 593-2308);

 

(d)  if to DB Canada, as Lender, Canadian
Administrative Agent or Revolving (Canadian) Facility Facing Agent, to it at
222 Bay Street, Suite 1100, Toronto, Ontario, Canada M5K 1E7, Attention of
Karyn Curran (Fax No. (416) 682-8444); and

 

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(e)  if to any other Lender, at its address (or
fax number) set forth in its Administrative Questionnaire.

 

Any party hereto may change its address or fax number for notices and
other communications hereunder by notice to the other parties hereto.  All notices and other communications given to
any party hereto in accordance with the provisions of this Agreement shall be
deemed to have been given on the date of receipt if delivered by hand or
overnight courier service or sent by fax, or on the date five Business Days
after dispatch by certified or registered mail if mailed, in each case
delivered, sent or mailed (properly addressed) to such party as provided in
this Section 11.01  The
Administrative Agent shall deliver to the Borrowers and to JPMCB, as a Senior
Agent, a copy of each Administrative Questionnaire received by it.

 

SECTION 11.02.  Survival of Agreement.  All covenants, agreements, representations
and warranties made by SSCC and the Borrowers herein and by the Loan Parties in
the other Loan Documents and in the certificates or other instruments prepared
or delivered in connection with or pursuant to this Agreement or any other Loan
Document shall be considered to have been relied upon by the Lenders, the
Agents and the Facing Agents and shall survive the making by the Lenders of the
Loans and the issuance of Letters of Credit by the Facing Agents, regardless of
any investigation made by, or on behalf of, the Lenders or the Facing Agents,
and shall continue in full force and effect as long as the principal of or any
accrued interest on any Loan or any Fee or any other amount payable under this
Agreement or any other Loan Document is outstanding and unpaid or any Letter of
Credit is outstanding and so long as the Commitments have not been
terminated.  The provisions of Sections
2.14, 2.15, 2.19 and 11.05 and Article IX
shall survive and remain in full force and effect regardless of the
consummation of the transactions contemplated hereby, the repayment of the
Loans, the expiration or termination of the Letters of Credit and the
Commitments or the termination of this Agreement or any provision hereof.

 

SECTION 11.03.  Counterparts; Binding Effect.  This Agreement may be executed in
counterparts (and by different parties hereto on different counterparts), each
of which shall constitute an original, but all of which when taken together
shall constitute a single contract.  This
Agreement shall become effective when it shall have been executed by the
Administrative Agent and when the Administrative Agent shall have received
counterparts hereof which, when taken together, bear the signatures of each of
the other parties hereto, and thereafter shall be binding upon and inure to the
benefit of SSCC, the Borrowers, the Agents, the Facing Agents and the Lenders
and their respective successors and assigns, except that neither SSCC nor any
Borrower shall have the right to assign its rights or duties hereunder or any
interest herein without the prior consent of all the Lenders, and any attempted
assignment by any such Person shall be void (it being understood that a merger
of SSCC or any Borrower with and into any other Person in which the other
Person is the surviving entity shall not be considered an assignment of such
Borrower’s duties hereunder and would instead be subject to the restrictions of
Section 7.05).

 

133

 

SECTION 11.04.  Successors and Assigns.  (a)  Subject
to Section 11.03, whenever in this Agreement any of the parties
hereto is referred to, such reference shall be deemed to include the successors
and assigns of such party, and all covenants, promises and agreements by or on
behalf of SSCC, the Borrowers, the Agents, the Facing Agents or the Lenders
that are contained in this Agreement shall bind and inure to the benefit of
their respective successors and assigns.

 

(b)  Each Lender may assign to one or more assignees
(treating any Approved Funds that are administered or managed by the same
Person or an Affiliate of such Person as a single assignee) all or a portion of
its interests, rights and/or obligations under this Agreement (including all or
a portion of its Commitments, its Deposit and the Loans at the time owing to
it); provided, however, that (i) except in the case of an
assignment to a Lender, an Affiliate of the assigning Lender or an Approved
Fund (unless the interest that is being assigned is a Revolving Credit
Commitment or a Revolving (Canadian) Credit Commitment, and such Lender,
Affiliate or Approved Fund is not then a Revolving Lender or Revolving
(Canadian) Lender, respectively), each of the Administrative Agent and, at any
time after the earlier of (A) the date upon which the Senior Agents reasonably
determine that the primary syndication of the Term Loans has been completed (it
being understood that the Senior Agents will promptly notify SSCE of the
occurrence of such date) and (B) 60 days after the Closing Date, SSCE (and (x)
in the case of an assignment of a Revolving Credit Commitment, the Swingline
Lender and the Revolving Facility Facing Agent, (y) in the case of an
assignment of a Revolving (Canadian) Credit Commitment, the Revolving (Canadian)
Facility Facing Agent and (z) in the case of an assignment of a Deposit
Funded Commitment, the Deposit Account Agent) must give its prior written
consent to such assignment (which consent shall not be unreasonably withheld or
delayed, it being understood that such consent shall be deemed to have been
reasonably withheld if the proposed assignee, in respect of a Revolving
(Canadian) Credit Commitment only, is a non-resident of Canada and is not
otherwise deemed to be a resident of Canada for the purposes of Part XIII of
the ITA), provided that the consent of SSCE shall not be required if an
Event of Default under paragraph (b), (c), (g) or (h)
of Article VIII has occurred and is continuing on the date of the
Assignment and Acceptance, (ii) upon reasonable request by any Senior Agent,
the Administrative Agents shall provide a list of all of the Lenders and a list
of the assignments and the parties thereto to such requesting Senior Agent
within two Business Days, (iii) except in the case of an assignment to a
Lender, an Affiliate of the assigning Lender or an Approved Fund, the amount of
the Commitments and Loans of the assigning Lender subject to each such
assignment (determined as of the date the Assignment and Acceptance with
respect to such assignment is delivered to the Administrative Agent) shall not
be less than U.S.$1,000,000 (or an amount equal to the remaining balance of
such Lender’s Commitments and Loans of the relevant Class) unless each of SSCE
and the Administrative Agent otherwise consents, and (iv) the parties to
each such assignment shall execute and deliver to the Administrative Agent an
Assignment and Acceptance, and a processing and recordation fee of U.S.$3,500; provided
further that, notwithstanding the foregoing, the sale or assignment by
any assignor (which acquired an interest in the

 

134

 

Commitments and Loans of any
Class in an amount less than U.S.$1,000,000 pursuant to an exception to clause (iii)
of the immediately preceding proviso) to any Person that is not a Lender or an
Affiliate of such assignor or an Approved Fund shall be subject to the minimum
assignment requirement set forth in the immediately preceding proviso if all
the Affiliates of such Lender hold Commitments and Loans of the relevant Class
in the amount of U.S.$1,000,000 or more in the aggregate.  Upon acceptance and recording pursuant to paragraph
(e) below, from and after the effective date specified in each Assignment
and Acceptance, (i) the assignee thereunder shall be a party hereto and,
to the extent of the interest assigned by such Assignment and Acceptance, shall
have the rights and obligations of a Lender under this Agreement and the other
Loan Documents and (ii) the assigning Lender thereunder shall, to the extent
of the interest assigned by such Assignment and Acceptance, be released from
its obligations under this Agreement (and, in the case of an Assignment and
Acceptance covering all or the remaining portion of an 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 2.14,
2.15, 2.19 and 11.05, as well as to any Fees accrued for
its account and not yet paid).

 

(c)  In the case of
any assignment pursuant to paragraph (b) above by a Deposit Funded
Lender, the Administrative Agent shall give prompt notice of effectiveness
thereof to the Deposit Account Agent. 
The Deposit of the assignor Deposit Funded Lender shall not be released,
but shall instead be purchased by the relevant assignee and continue to be held
for application (to the extent not already applied) in accordance with this
Agreement to satisfy such assignee’s obligations in respect of Deposit Funded
Loans and the Deposit Funded LC Exposure. 
Each Deposit Funded Lender agrees that immediately prior to each
assignment (i) the Administrative Agent shall establish a new Sub-Account in
the name of the assignee, (ii) a corresponding portion of the Deposit credited
to the Sub-Account of the assignor Deposit Funded Lender shall be purchased by
the assignee and shall be debited from the assignor’s Sub-Account and credited
to the assignee’s Sub-Account and (iii) if after giving effect to such
assignment the Deposit Funded Commitment of the assignor Deposit Funded Lender
shall be zero, the Administrative Agent shall close the Sub-Account of such
assignor Lender.

 

(d)  By executing and delivering an Assignment and
Acceptance, the assigning Lender thereunder and the assignee thereunder shall
be deemed to confirm to and agree with each other and the other parties hereto
as follows:  (i) such assigning
Lender warrants that it is the legal and beneficial owner of the interest being
assigned thereby, free and clear of any adverse claim; (ii) except as set
forth in clause (i) above, such assigning Lender makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Agreement, or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Agreement, any other Loan Document or any other
instrument or document furnished pursuant hereto, or the financial condition of
the Loan Parties or the performance or observance by the Loan Parties of any of
their obligations under this

 

135

 

Agreement or under any other
Loan Document or any other instrument or document furnished pursuant hereto;
(iii) such assignee represents and warrants that it is legally authorized
to enter into such Assignment and Acceptance; (iv) such assignee confirms
that it has received a copy of this Agreement, together with copies of any
amendments or consents entered into prior to the date of such Assignment and
Acceptance and copies of the most recent financial statements delivered
pursuant to Section 6.04 and such other documents and information
as it has deemed appropriate to make its own credit analysis and decision to
enter into such Assignment and Acceptance; (v) such assignee will
independently and without reliance upon any Agent, any Facing Agent, such
assigning Lender or any other Lender and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under this Agreement;
(vi) such assignee appoints and authorizes each of the Agents to take such
action as agent on its behalf and to exercise such powers as are delegated to
such Agent by the terms hereof and of the other Loan Documents, together with
such powers as are reasonably incidental thereto; and (vii) such assignee
agrees that it will perform in accordance with their terms all the obligations
that by the terms of this Agreement are required to be performed by it as a Lender.

 

(e)  The Administrative Agent, acting for this
purpose as agent of the Borrowers, shall maintain at one of its offices in The
City of New York a copy of each Assignment and Acceptance delivered to it and a
register for the recordation of the names and addresses of the Lenders, and the
Commitments of, and principal amount 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 in the absence of manifest error and SSCC, the Borrowers, the
Agents, the Facing Agents and the Lenders shall 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 SSCC, the Borrowers, any Agent, any Facing Agent and any Lender
at any reasonable time and from time to time upon reasonable prior notice.

 

(f)  Upon its receipt of a duly completed
Assignment and Acceptance executed by an assigning Lender and an assignee,
together with an Administrative Questionnaire completed in respect of the
assignee (unless the assignee shall already be a Lender hereunder), the
processing and recordation fee referred to in paragraph (b) above
and the written consent to such assignment of any Person whose consent is
required pursuant to paragraph (b) above, the Administrative Agent shall
(i) accept such Assignment and Acceptance and (ii) record the
information contained therein in the Register. 
No assignment shall be effective unless it has been recorded in the
Register as provided in this paragraph (f).

 

(g)  Each Lender may, without the consent of SSCC,
any Agent, any Facing Agent or the Swingline Lender, sell participations to one
or more banks or other entities in all or a portion of its rights and
obligations under this Agreement (including all or a portion of its Commitment,
its Deposit and the Loans owing to it); provided, however, that
(i) such Lender’s obligations under this Agreement shall

 

136

 

remain unchanged,
(ii) such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations, (iii) the participating
banks or other entities shall be entitled to the benefit of the cost protection
provisions contained in Sections 2.14, 2.15, 2.19 and
11.05 to the same extent as if they were Lenders, provided that,
except as expressly provided in Section 2.19(a), the Borrowers
shall not be required to reimburse the participating banks or other entities
pursuant to Section 2.14, 2.15, 2.19 or 11.05
in an amount in excess of the amount that would have been payable thereunder to
such Lender had such Lender not sold such participation, and (iv) the Borrowers,
the Agents, the Facing Agents and the other Lenders shall continue to deal
solely and directly with such Lender in connection with such Lender’s rights
and obligations under this Agreement, and such Lender shall retain the sole
right to enforce the obligations of the Loan Parties under the Loan Documents
and to approve any amendment, modification or waiver of any provision of this
Agreement (provided that the participating bank or other entity may be
provided with the right to approve amendments, modifications or waivers
affecting it that (v) decrease any Fees payable hereunder, (w) decrease the
amount of principal of, or the rate at which interest is payable on, the Loans,
(x) extend any scheduled principal payment date or date for the scheduled payment
of interest on the Loans, (y) increase the amount of or extend the termination
date of the Commitments or (z) release a Guarantor from its guarantee under the
applicable Guarantee Agreement (except as expressly contemplated by any Loan
Document) or all or substantially all of the Collateral from the Liens created
under the Security Documents (except as expressly contemplated by any Loan
Document).

 

(h)  Notwithstanding the limitations set forth in paragraph (b)
above, (i) any Lender may at any time assign all or any portion of its
rights under this Agreement to a Federal Reserve Bank without the prior written
consent of SSCC, any Agent, any Facing Agent or the Swingline Lender,
(ii) any Lender which is a fund may pledge all or any portion of its rights
under this Agreement to its trustee or other creditor in support of its
obligations to its trustee or other creditor without the prior written consent
of SSCC, any Agent, any Facing Agent or the Swingline Lender and (iii) any
Lender may at any time assign or pledge all or any portion of its rights under
this Agreement to direct or indirect contractual counterparties in swap
agreements related to the Loans, provided that no such assignment
pursuant to clause (i), (ii) or (iii) shall release a
Lender from any of its obligations hereunder or substitute any such Bank or
trustee for such Lender as a party hereto.

 

(i)  Except as provided in Article III
and Section 2.21, respectively, neither any of the Facing Agents
nor the Swingline Lender may assign or delegate any of its respective rights
and duties hereunder without the prior written consent of the Borrowers, each
Senior Agent and the Administrative Agent.

 

SECTION 11.05.  Expenses; Indemnity.  (a)  The
Borrowers agree, jointly and severally, to pay all reasonable out-of-pocket
expenses incurred by any Agent, any Facing Agent and the Swingline Lender in
connection with the preparation, execution and delivery of this Agreement and
the other Loan Documents (including all costs relating to due diligence) or in
connection with any amendments, modifications or

 

137

 

waivers of the
provisions hereof or thereof (whether or not the transactions hereby
contemplated shall be consummated) or incurred by any Agent, any Facing Agent
or any Lender in connection with the enforcement or protection of their rights
in connection with this Agreement and the other Loan Documents or in connection
with the Loans made or the Letters of Credit issued hereunder, including the
reasonable fees, disbursements and other charges of Cravath, Swaine & Moore
LLP, counsel for JPMCB and DB, and, in connection with any such enforcement or
protection, the reasonable fees, disbursements and other charges of any other
counsel for any Agent, any Facing Agent or any Lender.  The Borrowers further agree to indemnify the
Agents, the Facing Agents and the Lenders from, and hold them harmless against,
any documentary taxes, assessments or similar charges made by any Governmental
Authority by reason of the execution and delivery of this Agreement or any of
the other Loan Documents.

 

(b)  The Borrowers agree, jointly and severally,
to indemnify each Arranger, each Agent, each Facing Agent and each Lender and
each of their respective directors, officers, employees, trustees, advisors and
agents (each such person being called an “Indemnitee”) against, and to
hold each Indemnitee harmless from, any and all losses, claims, damages,
liabilities and related expenses, including reasonable counsel fees,
disbursements and other charges, incurred by or asserted against any Indemnitee
arising out of, in any way connected 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 or thereto of their respective obligations hereunder or
thereunder or the consummation of the Transactions and the other transactions
contemplated hereby or thereby, (ii) the use of the Letters of Credit or the
proceeds of the Loans, (iii) any claim, litigation, investigation or
proceeding relating to any of the foregoing, whether or not any Indemnitee is a
party thereto or (iv) any actual or alleged presence or release of
Hazardous Materials on or from any property currently or formerly owned or
operated by SSCC or any of the Subsidiaries or any of their respective
predecessors or any liability under any Environmental Law related in any way to
SSCC or any of the Subsidiaries, provided that such indemnity shall not,
as to any Indemnitee, be available to the extent that such losses, claims,
damages, liabilities or related expenses have resulted from the gross
negligence or willful misconduct of such Indemnitee.

 

(c)  The provisions of this Section 11.05
shall remain operative and in full force and effect regardless of the
expiration of the term of this Agreement, the consummation of the transactions
contemplated hereby, the repayment of any of the Loans, the invalidity or
unenforceability of any term or provision of this Agreement or any other Loan
Document, or any investigation made by or on behalf of any Agent, any Facing
Agent or any Lender.  All amounts due
under this Section 11.05 shall be payable promptly after written
demand therefor.

 

SECTION 11.06.  Right of Setoff.  Each Lender is hereby authorized, in addition
to any other right or remedy that any Lender may have by operation of law or
otherwise, at any time and from time to time upon any amount becoming due and
payable by any Loan Party under any Loan Document, after the expiration of any
grace period

 

138

 

with respect
thereto, to exercise, without notice to SSCC or any Borrower (any such notice
being expressly waived by each such Person), its banker’s lien or right of
combination of accounts or right of setoff and apply any and all deposits
(general or special, time or demand, provisional or final) at any time held and
other Indebtedness at any time owing by such Lender to or for the credit or the
account of any Loan Party against such due and payable amount.  Each Lender agrees to promptly notify the
Borrowers and the Administrative Agent after any such setoff and application
made by such Lender, provided that the failure to give such notice shall
not affect the validity of such setoff and application.

 

SECTION 11.07.  Applicable Law.  THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS (OTHER THAN AS EXPRESSLY SET FORTH IN
THE SECOND PARAGRAPH OF ARTICLE IX AND IN THE OTHER LOAN DOCUMENTS) SHALL
BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK, INCLUDING SECTIONS 5-1401 AND 5-1402 OF TITLE 14 OF THE NEW YORK GENERAL
OBLIGATIONS LAW BUT EXCLUDING ALL OTHER CHOICE OF LAW AND CONFLICTS OF LAWS
RULES THEREOF.

 

SECTION 11.08.  Waivers; Amendment.  (a)  No
failure or delay on the part of any Agent, any Facing Agent or any Lender in
exercising any power or right hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise of any such right or power, or any
abandonment or discontinuation of steps to enforce such a right or power,
preclude any other or further exercise thereof or the exercise of any other
right or power.  The rights and remedies
of the Agents, the Facing Agents and the Lenders hereunder and under the other
Loan Documents are cumulative and are not exclusive of any rights or remedies
that they would otherwise have.  No
waiver of any provision of this Agreement or any other Loan Document or consent
to any departure by the Loan Parties therefrom shall in any event be effective
unless the same shall be permitted by paragraph (b) below, and then
such waiver or consent shall be effective only in the specific instance and for
the purpose for which given.  No notice
or demand on the Loan Parties in any case shall entitle the Loan Parties to any
other or further notice or demand in similar or other circumstances.

 

(b)  Neither this Agreement or any of the other
Loan Documents nor any provision hereof or thereof may be waived, amended or
modified except (i) in the case of this Agreement, pursuant to an
agreement or agreements in writing entered into by SSCC and the Required
Lenders and (ii) in the case of any other Loan Document, pursuant to an
agreement or agreements entered into by the parties to such Loan Document, in each
case, except as provided in Section 2.23(d) with respect to
Incremental Commitments or as set forth in the final sentence of this paragraph
(b), with the consent of the Required Lenders; provided, however,
that no such agreement shall (i) decrease the principal amount of, or
extend the maturity of or any scheduled principal payment date or date for the
scheduled payment of any interest on any Loan or any date for reimbursement of
an LC Disbursement, or waive or excuse any such payment or any part thereof, or
decrease the rate of interest on any Loan or LC Disbursement, without the prior
written consent of each

 

139

 

Lender affected
thereby, (ii) increase the amount of or extend the termination date
of the Commitment of, or decrease or extend the date for payment of any Fee
owing to, any Lender without the prior written consent of such Lender,
(iii) amend or modify the pro rata requirements of Section 2.16
or the provisions of Section 11.03 concerning the assignment of
SSCC’s or any Borrower’s obligations hereunder, the provisions of this Section 11.08
or release a Guarantor from its guarantee under the applicable Guarantee
Agreement (except as expressly contemplated by any Loan Document) or all or
substantially all of the Collateral from the Liens created under the Security
Documents (except as expressly contemplated by any Loan Document), without the
prior written consent of each Lender, (iv) change the provisions of any
Loan Document in a manner that by its terms adversely affects the rights in
respect of payments due to Lenders holding Loans of one Class differently from
the rights of Lenders holding Loans of any other Class without the prior
written consent of  Lenders holding a majority in interest of the
outstanding Loans and unused Commitments of each adversely affected Class or
(v) reduce the percentage contained in the definition of the term “Required
Lenders” without the prior written consent of each Lender; provided, further,
however, that no such agreement shall amend, modify or otherwise affect
the rights or duties of any Agent, the Swingline Lender or any Facing Agent
hereunder or under any other Loan Document without the prior written consent of
such Agent, the Swingline Lender or such Facing Agent, as the case may be.  The Lenders hereby authorize the Collateral
Agent to enter into such amendments, restatements, supplements or other
modifications to the Security Documents as are deemed reasonably necessary by
the Collateral Agent to protect and preserve the Liens on the Collateral
created or purported to be created thereunder or to reflect or give effect to
any transaction permitted under this Agreement.

 

SECTION 11.09.  Release of Collateral and Guarantors.  Each Lender hereby directs the Collateral
Agent to release, or to cause the Trustee to release, the Liens held by it
under the Security Documents and the Guarantees made in the Loan Documents as
follows:

 

(a)  upon payment in full in cash of the Loans and
all the other Loan Documents Obligations (other than unasserted contingent and
indemnification obligations), termination of all Commitments (including
commitments of the Facing Agents to issue Letters of Credit) and reduction of
the LC Exposure to zero (or the making of other arrangements satisfactory to
the Senior Agents and each applicable Facing Agent), the Collateral Agent is
authorized to release, or cause the Trustee to release, all of the Liens
created, and all the Guarantees made, under the Loan Documents;

 

(b)  upon any sale or other disposition of
Collateral permitted hereunder, or consummation of any transaction permitted
hereunder as a result of which any Guarantor (other than SSCE or SSCC) ceases
to be a Subsidiary of SSCC, the Collateral Agent is authorized to release, or
to cause the Trustee to release, such Liens that relate solely to the
Collateral sold or otherwise disposed and the Guarantee made by such Guarantor
under the Loan Documents; and

 

140

 

(c)  upon consent by the Required Lenders, the
Collateral Agent is authorized to release, or to cause the Trustee to release,
such Liens on any part of the Collateral which release does not require the
consent of all of the Lenders as set forth in Section 11.08;

 

provided, however, that (i) the
Collateral Agent shall not be required to execute, or cause the Trustee to
execute, any such document on terms which, in its opinion, would expose it or
the Trustee to liability or create any obligation or entail any consequence
other than the release of such Liens without recourse or warranty, and
(ii) such release shall not in any manner discharge, affect or impair the
Obligations or any Liens upon (or obligations of SSCC or any of the
Subsidiaries in respect of) all interests retained by SSCC or any of the
Subsidiaries.

 

SECTION 11.10.  Interest Rate Limitation.  Notwithstanding anything herein to the
contrary, if at any time the applicable interest rate, together with all fees
and charges that are treated as interest under applicable law (collectively,
the “Charges”), as provided for herein or in any other document executed
in connection herewith, or otherwise contracted for, charged, received, taken
or reserved by any Lender, shall exceed the maximum lawful rate (the “Maximum
Rate”) that may be contracted for, charged, taken, received or reserved by
such Lender in accordance with applicable law, the rate of interest payable to
such Lender hereunder, together with all Charges payable to such Lender, shall
be limited to the Maximum Rate.

 

SECTION 11.11.  Entire Agreement.  This Agreement, the other Loan Documents and
any separate fee letter agreements with respect to fees payable to any Agent or
any Facing Agent constitute the entire contract between the parties relative to
the subject matter hereof.  Any previous
agreement among the parties with respect to the subject matter hereof is
superseded by this Agreement and the other Loan Documents.  Nothing in this Agreement or in the other
Loan Documents, expressed or implied, is intended to confer upon any Person
other than the parties hereto and thereto (and their respective successors and
assigns permitted hereby and each other Person that is an Indemnitee) any
rights, remedies, obligations or liabilities under or by reason of this
Agreement or the other Loan Documents.

 

SECTION 11.12.  Waiver of Jury Trial.  Each party hereto hereby waives, to the
fullest extent permitted by applicable law, any right it may have to a trial by
jury in respect of any legal proceeding directly or indirectly arising out of, under
or in connection with this Agreement or any of the other Loan Documents or the
transactions contemplated hereby.  Each
party hereto (a) certifies that no representative, agent or attorney of
any other party has represented, expressly or otherwise, that such other party
would not, in the event of litigation, seek to enforce the foregoing waiver and
(b) acknowledges that it and the other parties hereto have been induced to
enter into this Agreement and the other Loan Documents, as applicable, by,
among other things, the mutual waivers and certifications in this Section 11.12.

 

SECTION 11.13.  Severability.  In the event any one or more of the
provisions contained in this Agreement or in any other Loan Document should be
held

 

141

 

invalid,
illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein and therein shall
not in any way be affected or impaired thereby. 
The parties shall endeavor in good-faith negotiations to replace the
invalid, illegal or unenforceable provisions with valid provisions, the
economic effect of which comes as close as possible to that of the invalid,
illegal or unenforceable provisions.

 

SECTION 11.14.  Headings.  Article and Section headings and
the Table of Contents used herein are for convenience of reference only, are
not part of this Agreement and are not to affect the construction of, or to be
taken into consideration in interpreting, this Agreement.

 

SECTION 11.15.  Confidentiality.  (a)  Each
Lender agrees not to disclose to any Person the Information (as defined below)
in accordance with such Lender’s customary procedures for non-disclosure of
confidential information of third parties of this nature and in accordance with
safe and sound lending practices without the prior written consent of SSCE,
which consent shall not be unreasonably withheld, except that any Lender shall
be permitted to disclose Information (i) to its and its Affiliates’
officers, directors, employees, agents and representatives (including its
auditors and counsel) or to  any pledgee
referred to in Section 11.04(h)(ii) or any direct or indirect
contractual counterparty in swap agreements or such contractual counterparty’s
professional advisor (so long as such pledgee, contractual counterparty or
professional advisor to such contractual counterparty agrees in writing to be
bound by the provisions of this Section 11.15); (ii) to the
extent (A) required by applicable laws and regulations or by any subpoena
or similar legal process or (B) requested or required by any regulatory
authority or The National Association of Insurance Commissioners or any similar
organization, or any nationally recognized rating agency that requires access
to information about a Lender’s investment portfolio; (iii) to the extent
such Information (A) becomes publicly available other than as a result of
a breach of this Agreement, (B) becomes available to such Lender on a
non-confidential basis from a source other than a Loan Party or its Affiliates
or (C) was available to such Lender on a non-confidential basis prior to
its disclosure to such Lender by a Loan Party or its Affiliates; (iv) to
any actual or prospective assignee of, or prospective purchaser of a participation
in, the rights of such Lender hereunder, in each case subject to paragraph (c)
below; or (v) in connection with any suit, action or proceeding relating
to the enforcement of rights hereunder or under any other Loan Document or in
connection with the transactions contemplated hereby.  As used in this Section 11.15, as
to any Lender, the term “Information” shall mean the Confidential
Information Memorandum and any other materials, documents and information that
either Borrower or any of its Affiliates may have furnished or may hereafter
furnish to any Lender in connection with this Agreement.

 

(b)  Each Lender agrees that it will use the
Information only for purposes related to the transactions contemplated hereby
and by the other Loan Documents, provided that (i) if the
conditions referred to in any of subclauses (A) through (C)
of clause (iii) of paragraph (a) above are met,
such Lender may otherwise use the Information and (ii) if such Lender or
any of its

 

142

 

Affiliates is otherwise a
creditor of a Loan Party, such Lender or any such Affiliate may use the
Information in connection with its other credits to such Loan Party.

 

(c)  Each Lender agrees that it will not disclose
any of the Information to any actual or prospective assignee of such Lender or
participant in any rights of such Lender under this Agreement unless such
actual or prospective assignee or participant first executes and delivers to
such Lender or the Borrowers a confidentiality letter containing substantially
the undertakings set forth in this Section 11.15.

 

SECTION 11.16.  Jurisdiction; Consent to Service of
Process.  (a)  Each of SSCC and the Borrowers hereby
irrevocably and unconditionally submits, for itself and its property, to the
nonexclusive jurisdiction of any New York State court or Federal court of the
United States of America sitting in New York City, and any appellate court from
any thereof, in any action or proceeding arising out of or relating to this
Agreement or the other Loan Documents, or for recognition or enforcement of any
judgment, and each of the parties hereto hereby irrevocably and unconditionally
agrees that all claims in respect of any such action or proceeding may be heard
and determined in such New York State or, to the extent permitted by 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 shall affect any right that any Lender may
otherwise have to bring any action or proceeding relating to this Agreement or
the other Loan Documents against any Loan Party or its properties in the courts
of any jurisdiction.

 

(b)  Each of SSCC and the Borrowers hereby
irrevocably and unconditionally waives, to the fullest extent it may legally
and effectively do so, any objection that it may now or hereafter have to the
laying of venue of any suit, action or proceeding arising out of or relating to
this Agreement or the other Loan Documents in any New York State or Federal
court.  Each of the parties hereto hereby
irrevocably waives, to the fullest extent permitted by law, the defense of an
inconvenient forum to the maintenance of such action or proceeding in any such
court.

 

(c)  Each party to this Agreement irrevocably
consents to service of process in the manner provided for notices in Section 11.01.  Nothing in this Agreement will affect the
right of any party to this Agreement to serve process in any other manner
permitted by law.

 

SECTION 11.17.  Florida Real Property.  The parties hereto hereby acknowledge that
the Revolving Loans, the Swingline Loans and Revolving (Canadian) Loans are
secured by real and personal property located both inside and outside the State
of Florida and hereby agree that for purposes of calculating intangible taxes
due under Section 199.133, Florida Statutes, the first amounts advanced as
Revolving Loans, Swingline Loans and Revolving (Canadian) Loans shall be deemed
to be the portion allocable to the Collateral consisting of real property
located in the State of Florida, and such portion allocable to such Collateral
shall also be deemed to be the last to be repaid

 

143

 

under the
terms hereof.  Nothing herein shall limit
any secured party’s right to recover or realize from the Collateral located in
the State of Florida amounts in excess of that allocated to the Revolving
Loans, Swingline Loans or Revolving (Canadian) Loans or to apply amounts so
recovered or realized against the Obligations in such order as the Agent named
in the applicable security filing shall determine in its sole discretion.

 

SECTION 11.18.  Judgment Currency.  (a)  Except
as otherwise provided in Section 10.03, the Borrowers’ obligations
hereunder and the Borrowers’ and the other Loan Parties’ obligations under the
other Loan Documents to make payments in U.S. Dollars or in Canadian Dollars
(the “Obligation Currency”) shall not be discharged or satisfied by any
tender or recovery pursuant to any judgment expressed in or converted into any
currency other than the Obligation Currency, except to the extent that such
tender or recovery results in the effective receipt by the applicable Agent,
the applicable Facing Agent or the applicable Lender of the full amount of the
Obligation Currency expressed to be payable to the applicable Agent, the
applicable Facing Agent or the applicable Lender under this Agreement or the
other Loan Documents.  If, for the
purpose of obtaining or enforcing judgment against either Borrower or any other
Loan Party in any court or in any jurisdiction, it becomes necessary to convert
into or from any currency other than the Obligation Currency (such other currency
being hereinafter referred to as the “Judgment Currency”) an amount due
in the Obligation Currency, the conversion shall be made, at the Exchange Rate,
in the case of Canadian Dollars or U.S. Dollars, and, in the case of other
currencies, the rate of exchange (as quoted by the Administrative Agent or if
the Administrative Agent does not quote a rate of exchange on such currency, by
a known dealer in such currency designated by the Administrative Agent)
determined, in each case, as of the date immediately preceding the day on which
the judgment is given (such Business Day being hereinafter referred to as the “Judgment
Currency Conversion Date”).

 

(b)  If there is a change in the rate of exchange
prevailing between the Judgment Currency Conversion Date and the date of actual
payment of the amount due, the Borrowers covenant and agree to pay, or cause to
be paid, such additional amounts, if any (but in any event not a lesser
amount), as may be necessary to ensure that the amount paid in the Judgment Currency,
when converted at the rate of exchange prevailing on the date of payment, will
produce the amount of the Obligation Currency which could have been purchased
with the amount of Judgment Currency stipulated in the judgment or judicial
award at the rate of exchange prevailing on the Judgment Currency Conversion
Date.

 

(c)  For purposes of determining the amount of any
payment in the Obligation Currency under this Section 11.18, the
rate of exchange used shall take into account any premium and costs payable in
connection with the purchase of the Obligation Currency.

 

SECTION 11.19.  Certain Relationships.  Nothing contained in this Agreement and no
action taken by any Agent, any Facing Agent or any Lender pursuant hereto shall
be deemed to constitute the Agents, the Facing Agents or the Lenders a
partnership, an association, a joint venture or other entity.  None of the Agents, the

 

144

 

Facing Agents
or the Lenders has any fiduciary relationship with or any fiduciary duty to
SSCC or either Borrower arising out of or in connection with this Agreement or
any of the other Loan Documents, and the relationship between the Agents, the
Facing Agents and the Lenders, on the one hand, and the Borrowers, on the other
hand, in connection herewith or therewith is solely that of debtor and
creditor.

 

SECTION 11.20.  USA Patriot Act.  Each Lender subject to the requirements of
the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26,
2001)) (the “Act”) hereby notifies the Borrowers that pursuant to the
Act it is required to obtain, verify and record information that identifies the
Borrowers, which information includes the name and address of each Borrower and
other information that will allow such Lender to identify each Borrower in
accordance with the Act.

 

145

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year first
above written.

 

	
   

  	
  SMURFIT-STONE CONTAINER CORPORATION,

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
  /s/ Jeffrey
  S. Beyersdorfer

  	
   

  
	
   

  	
   

  	
   

  	
  Name:Jeffrey
  S. Beyersdorfer

  
	
   

  	
   

  	
   

  	
  Title:Vice
  President and Treasurer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SMURFIT-STONE CONTAINER ENTERPRISES, INC.,

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
  /s/ Jeffrey
  S. Beyersdorfer

  	
   

  
	
   

  	
   

  	
   

  	
  Name:Jeffrey
  S. Beyersdorfer

  
	
   

  	
   

  	
   

  	
  Title:Vice
  President and Treasurer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SMURFIT-STONE CONTAINER CANADA INC.,

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
  /s/ Jeffrey
  S. Beyersdorfer

  	
   

  
	
   

  	
   

  	
   

  	
  Name:Jeffrey
  S. Beyersdorfer

  
	
   

  	
   

  	
   

  	
  Title:Vice
  President and Treasurer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  DEUTSCHE BANK TRUST COMPANY AMERICAS, individually and as Senior
  Agent, Administrative Agent, Collateral Agent, Swingline Lender and Revolving
  Facility Facing Agent,

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
  /s/ Susan
  LeFevre

  	
   

  
	
   

  	
   

  	
   

  	
  Name:Susan
  LeFevre

  
	
   

  	
   

  	
   

  	
  Title:Director

  
						

 

146

 

	
   

  	
  DEUTSCHE BANK AG, individually and as Canadian Administrative Agent
  and Revolving (Canadian) Facility Facing Agent,

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
  /s/ Karyn
  Curran

  	
   

  
	
   

  	
   

  	
   

  	
  Name:Karyn
  Curran

  
	
   

  	
   

  	
   

  	
  Title:Credit
  Product Manager

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
  /s/ Robert
  A. Johnson

  	
   

  
	
   

  	
   

  	
   

  	
  Name:Robert
  A. Johnson

  
	
   

  	
   

  	
   

  	
  Title:Vice
  President

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  JPMORGAN CHASE BANK, individually and as Senior Agent, Deposit
  Account Agent and Deposit Funded Facility Facing Agent,

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
  /s/ Marian
  N. Schulman

  	
   

  
	
   

  	
   

  	
   

  	
  Name:Marian
  N. Schulman

  
	
   

  	
   

  	
   

  	
  Title:Managing
  Director

  

 

147

 

SIGNATURE PAGE TO

THE CREDIT AGREEMENT

DATED AS OF NOVEMBER 1,
2004, OF

SMURFIT-STONE CONTAINER
ENTERPRISES, INC. AND

SMURFIT-STONE CONTAINER CANADA
INC.

 

 

	
   

  	
  Name of
  Institution:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

  

 

148

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