Document:

EXHIBIT 10.1

Employment
Agreement 

This Employment Agreement
(the “Agreement”) dated and effective as of September 27, 2006 (the “Effective
Date”) is by and between Treaty  Oak Bancorp, Inc., a Texas corporation (the “Company”),
and Jeffrey L. Nash (“Banker”). In
consideration of the mutual covenants and promises contained herein, the
parties agree as follows:

Whereas, Banker has been
employed by the Company for 2 years, and the services of Banker, his managerial
and financial experience, and his knowledge of the affairs of the Company are
of great value to the Company; and

Whereas, the Company deems
it essential that it have the advantage of the services of Banker for a period
extending beyond his present employment agreement, and desires to enter into a
continuing agreement of employment with him, and to provide Banker with
compensation for past contributions to the Company; and Banker desires to enter
into such an agreement with the Company upon the terms and conditions stated
hereunder.

Article 1

General Provisions

Section 1.1             Employment.
The Company hereby employs Banker, and Banker accepts such employment by the
Company upon the terms and conditions hereof.

Section 1.2             Term. Subject to earlier termination as specifically set forth herein, the
initial term of this Agreement shall be two (2) years (the “Term”) commencing
on the Effective Date. The Term shall be extended automatically without further
action by either party for successive one (1) year terms, unless either party
shall have served ninety (90) days prior written notice upon the other party
that this Agreement shall terminate.

Section 1.3             Termination.
Banker’s employment and this Agreement shall terminate upon the earliest to
occur of any of the following events (the actual date of such termination being
referred to herein as the “Termination Date”):

(a)                                  Pursuant to
written notice, given as provided in Section 1.2.

(b)                                 In the event of
Banker’s death or disability as set forth in Section 3.7.

(c)                                  Termination of
Banker’s employment by the Company for cause without any prior notice (except
as specifically set forth below), upon the occurrence of any of the following
events (each of which shall constitute “Cause”):

(i)                         any
embezzlement or wrongful diversion of funds of the Company or any affiliate of
the Company by Banker;

 

(ii)                      gross
malfeasance by Banker in the conduct of Banker’s duties;

(iii)                   breach of this Agreement
and, if such breach is capable of being cured, as determined by the Board of
Directors of the Company (the “Board of Directors”), failure of Banker to cure
such breach after written notice and reasonable opportunity to cure such
breach;

(iv)                  gross neglect by Banker in
carrying out Banker’s duties;

(v)                     Willful violation by Banker
of state or federal statutes, banking regulations or SEC regulations; or

(vi)                  Willful violation by Banker
of the Company’s code of conduct.

(d)                                 Termination of
Banker’s employment by the Company at any time without Cause.

(e)                                  Termination by
Banker of his employment at any time.

Section 1.4             Termination
Obligations: Return of Company Property. Upon termination of
this Agreement, Banker shall promptly return all Company property.

Article 2

Position and Duties; Other
Business Activities

Section 2.1             Position.
Banker shall be employed as President and Chief Executive Officer of the
Company and report to the Board of Directors. Banker holds a voting seat on the
Board of Directors and shall continue to serve at the pleasure of the Board of
Directors and the stockholders. Such employees as Banker may determine, subject
to the approval of the Board of Directors, shall report to Banker.

Section 2.2             Duties:
Full Attention to Business; Locale for Performance of Duties.  Banker shall perform such services for the
Company, that reasonably serve the purpose of this Agreement and/or meet the
needs of the Company, as may be reasonably assigned to him by the Board of
Directors and that are consistent with the position Banker holds. Banker shall
devote his full business time, energies, interest, abilities and productive
efforts to the business of the Company. Without the Company’s written consent,
Banker shall not render any kind of employee-type or consulting services to
others for compensation without the consent of the Board of Directors, and, in
addition, shall not engage in any activity which conflicts or interferes with
his performance of duties hereunder.(1) Banker shall be employed at the Company’s
Austin, 

(1)             Banker
has served for several years (preceding his employment by Bank), and continues
to serve, as a paid director for a very small company (which is not a bank or
bank-related business); an activity that requires no time from Banker during
normal business hours except for a lunch meeting once every six months, and
that requires minimal other time of Banker — all outside of normal
business hours; and by signing below Bank has acknowledged Banker’s disclosure
of such activities and consented to Banker’s continued participation in such
activities.

 

 

Texas, headquarters, and shall be expected to reside
in the Austin area; and minimal travel shall be expected of Banker in the
regular performance of his duties.  In
the event the Company requests Banker to relocate his residence or primary work
location to a city other than Austin, Texas, the Company agrees to: (1) give
Banker not less than six (6) months’ advance written notice of any requested
relocation; and, (b) pay all reasonable moving expenses required to effect the
relocation of Banker and his family, including but not limited to providing
relocation assistance to facilitate the sale of Banker’s current residence and
acquisition of a comparable residence in a comparable quality neighborhood in
the new locale at no net cost to Banker; and, (c) commencing upon the first
date Banker is to effect such relocation, increase Banker’s Base Salary to
adjust for the increased costs of living, if any, at any such other city to
which Banker has relocated at the Company’s request.

Section 2.3             Covenant
Not To Compete During Term. During the Term,
Banker shall comply in all respects with the Company’s written policies with
respect to conflicts of interest. Banker shall not, without the prior written
consent of the Board of Directors, engage in or be interested, directly or
indirectly, in any business or operation competitive with the Company. For the
purpose of this paragraph, Banker shall be deemed to be interested in a
business or operation which is competitive with the Company if Banker is a
holder of 5% or more of the issued and outstanding ownership interests in such
business or operation, or serves as a director, officer, employee, agent,
partner, individual proprietor, lender, consultant, or independent contractor
of such business or operation.

Section 2.4             Non-Disclosure
of Confidential Information. Banker acknowledges that in
connection with his employment by the Company or its affiliates, he has and may
acquire or learn “Confidential Information” of the Company by virtue of a
relationship of trust and confidence between Banker and the Company. Banker
warrants and agrees that during the Term he shall not disclose to anyone (other
than to officers of the Company or to such other persons as such officers may
designate), or use, except in the course of Banker’s employment with the
Company or its affiliates, any Confidential Information acquired by him in the
course of or in connection with his employment. As used herein, the term “Confidential
Information” shall include, but not be limited to: all information of any type
or kind, whether or not reduced to a writing and whether or not conceived,
originated, discovered or developed in whole or in part by Banker, which is
directly related to the Company, its operations, policies, agreements with
third parties, its financial affairs and related matters, including business
plans, strategic planning information, product information, purchase and sales
information and terms, supplier negotiation points, styles and strategies,
contents and terms of contracts between the Company and suppliers, advertisers,
vendors, contact persons, terms of supplier and/or vendor contracts or
particular transactions, potential supplies and/or vendors, or other related
data; marketing information such as but not limited to, prior, ongoing or
proposed marketing programs, presentations, or agreements by or on behalf of
the Company, pricing information, customer bonus programs, marketing tests
and/or results of marketing efforts, computer files, lists and reports, manuals
and memos pertaining to the business of the Company, lists or compilations of
vendor and/or supplier names, addresses, phone numbers, requirements and
descriptions, contract information sheets, compensation requirements or terms,
benefits, policies, and any other financial information whether about the
Company, entities related or affiliated with the Company or other 

 

key information pertaining to the business of the
Company, including but not limited to all information which is not generally
available to or known in the information services industry (or is available
only as a result of an unauthorized disclosure) and is treated by the Company
as “Confidential Information” during the term of this Agreement, regardless of
whether or not such Information is a “trade secret” as otherwise defined by
applicable law.  “Confidential
Information” shall not include any such information that is made available to
the public generally, or is in the public domain.

Section 2.5             No Solicitation of Employees. Banker specifically
agrees that during the Term and for a period of one (1) years after his
termination of employment with the Company, Banker shall not, directly or
indirectly, either for himself or for any other person, firm, corporation or
legal entity, solicit any individual then employed by the Company to leave the
employment of the Company.

Section 2.6             Ownership
of Work Product and Ideas. Any
discoveries, inventions, patents, materials, licenses and ideas applicable to
the industry or relating to Banker’s services for the Company or its
affiliates, whether or not patentable or copyrightable, created by Banker
during his employment by the Company or its affiliates (“Work Product”) and all
business opportunities within the industry (“Opportunities”) introduced to
Banker by the Company or its affiliates will be owned by the Company, and
Banker will have no personal interest in such, except to the extent that the
Company allows Banker to invest or participate in or have other rights to such
Work Product or Opportunities. Banker will, in such connection, promptly
disclose any such Work Product and Opportunities to the Company and, upon
request of the Company, will assign to the Company all right in such Work
Product and Opportunities.

Article 3

Compensation; Benefits 

Section 3.1             Salary. The Company shall pay Banker Eight Thousand three hundred
thirty three and 33/100 Dollars ($8333.33) on a semi-monthly basis, for an
annualized base salary (“Base Salary”) of Two hundred thousand and NO/100
Dollars ($200,000.00). Beginning with the first anniversary of the date of the
Agreement and for each subsequent year of employment (or any portion of any
such year), Banker shall be entitled to a base salary review by the Company to
determine if any increase to base salary is warranted as a result of
performance.

Section 3.2             Bonus. In addition to the Banker’s base salary, Banker shall be
eligible to receive a bonus (“Bonus”) for each fiscal year equal to fifty
percent of Banker’s annual base salary, plus (b) such additional amount based
on Banker’s performance as may be determined by the Board of Directors in its
sole discretion. Any Bonus owing to Banker shall be paid within thirty (30)
days following the filing of the Company’s annual report on Form 10-K for the
applicable fiscal year.

Section 3.3             Paid Vacation.
Banker shall be entitled to
five (5) weeks of paid vacation during each year of service, or such longer
amount of vacation time as Banker and the Compensation Committee of the Board
of Directors shall mutually agree upon.

 

Section 3.4             Stock
Options.

(a)                                  Subject to
approval of the Compensation Committee of the Board of Directors, the Company
will grant to Banker (i) an option to purchase 10,000._ shares of
common stock of the Company under the Company’s Incentive Stock Option Plan
(the “Plan”), which shall be intended to qualify as an incentive stock option
to the maximum extent permitted under Section 422 of the Internal Revenue Code
of 1986, as amended, and (ii) subject to compliance with the limitations of the
NASDAQ Stock Exchange applicable to grants of options to officers without
stockholder approval, an option to purchase an additional 5,000 shares outside
the Plan. All such options will have an exercise price per share equal to the fair market value of the Company’s common stock as of the date
of grant. Each option shall be subject to the terms and conditions of the Plan
(or substantially equivalent terms if
the option is granted outside the Plan) and an option agreement to be
entered into between the Company and Banker, in a form approved by the
Compensation Committee of the Board of Directors. Each option agreement shall
provide that the option shall have a ten year term (subject to earlier
termination in connection with termination of employment).

(b)                                 The options
shall vest and become exercisable, subject to continued employment, as follows:

(i)                         The option
described in Section 3 .4(a)(i) for 10,000 shares shall vest as to 33% of the
shares on October 25, 2006, 33% on October 25, 2007 and as to the remaining 33%
on October 25, 2008,

(ii)                      The option
described in Section 3.4(a)(ii) for 5,000 shares, to be granted following the
Effective Date, shall vest as to 33% of the shares on September 27, 2007, 33%
of the shares on September 27, 2008, and as to the remaining 33% of the shares
on September 27, 2009.

in each case to become fully
vested and exercisable upon a Change in Control as defined in the Plan.

(c)                                  Banker shall be
eligible to receive additional grants of options pursuant to the Plan in the
sole discretion of the Compensation Committee and/or the Board of Directors.

(d)                                 If the Company
is subject to a Change in Control as defined in the Plan during the Term but
prior to the grant of the option described in Section 3 .4(a)(ii) for 5,000 shares (to be granted one year following
the Effective Date), Banker shall be entitled to a cash bonus equal to the
excess of the fair market value of the shares for which such options were not
granted as of the date of the Change in Control, over the fair market value of
such - shares as of September 27,, 2006. Any 

 

                                                payments due
hereunder shall be paid within sixty (60) days of the date of the Change in
Control.

Section 3.5             Reimbursement
of expenses.  The Company
shall promptly reimburse Banker for reasonable expenses incurred by him while
conducting business on behalf of the Company or in furtherance of the Company’s
interests, provided that Banker complies with reasonable expense reimbursement
policies or practices of the Company.

Section 3.6             Other
Benefits. During the
Term, Banker shall be entitled to participate in present and future employee
benefit plans which are available to the Company’s executive employees, subject
to eligibility requirements thereunder. 
In addition, the Company shall continue to pay directly (or promptly
reimburse) cell phone charges, UT Club membership fees and dues, Headliner’s
Club membership fees and dues, and such other club membership fees and dues as
the Board’s Compensation Committee shall determine are of benefit to the
Company.

Section 3.7             Disability
or Death. If the Board of Directors determines, on the basis of
professional medical advice, that Banker has become unable to substantially
perform his duties under this Agreement due to illness or mental or physical
disability, and that such failure or inability has continued or is reasonably
expected to continue for any consecutive six-month period, the Company shall have
the option to terminate this Agreement by giving written notice to Banker
thereof and the basis therefor at least 30 days prior to the effective date of
termination. This Agreement shall also terminate immediately upon Banker’s
death. If Banker’s employment with the Company is terminated pursuant to this
Section 3.7, the Company shall pay Banker the salary, bonuses and commissions
which are earned but unpaid as of the date of termination. The Board of
Directors shall have discretion to determine the amount, if any, of Bonus which
Banker has earned prior to termination of employment during a fiscal year.

Section 3.8             Severance. 

(a)                                  If the Company
terminates Banker’s employment other than for Cause pursuant to Section 1.3(d),
and other than by reason of death or Disability pursuant to Section 3.7, or if
Banker resigns within ten (10) days following (i) a material diminution in his
title, responsibilities or direct-report staff; or (ii) within six (6) months
following a Change of Control, then subject to Banker’s continuing obligations
under Sections 2.4 and 2.5 and in consideration of the execution, delivery and
effectiveness of a general release of claims in a standard form approved by the
Company, the Company shall pay to Banker a lump sum of one times Banker’s
current Base Salary in cash within fifteen (15) days after the date of
termination (or, if later, upon the effectiveness of the general release
following any applicable revocation period) and shall vest 100% of Banker’s
then remaining unvested options granted in accordance with this Agreement, in
addition to other amounts payable from qualified plans, nonqualified retirement
plans, and deferred compensation plans, which amounts shall be paid (or
otherwise vested or deposited) in accordance with the terms of such plans.

 

(b)                                 If the Company
terminates Banker’s employment for Cause, or if Banker resigns [voluntarily and
other than pursuant to Section 3.8(b) above], then Banker shall only be
entitled to be paid his accrued, unpaid Base Salary through the effective date
of his termination of employment and his entitlement to other amounts payable
from qualified plans, nonqualified retirement plans, and deferred compensation
plans shall be determined in accordance with the terms of such plans.

(c)                                  No severance
benefits shall be provided pursuant to Sections 3.8(a) or (b) if Banker’s
employment is terminated by reason of expiration or non- renewal of this
Agreement for any reason.

Section 3.9             Excess
Parachute Payments. 

(a)                                  If there is a “change
of control” of the Company within the meaning of Section 2800 of the Internal
Revenue Code of 1986, as amended (the “Code”), a portion of the benefits to
which Banker is entitled under this Agreement could be characterized as “excess
parachute payments” within the meaning of Section 2800 of the Code. The parties
hereto acknowledge that the protections set forth in this Section 3.9 are
important, and it is agreed that Banker should not have to bear the full burden
of the excise tax that might be levied under Section 4999 of the Code or any
similar provision of federal, state of local law, in the event that any portion
of the benefits payable to Banker pursuant to this Agreement or the other
incentive plans of the Company are treated as an excess parachute payment. The parties,
therefore, have agreed as set forth in this Section 3.9.

(b)                                 Anything in
this Agreement to the contrary notwithstanding, Whenever it shall be determined
that any payment or distribution (including income recognized by Banker upon
the early vesting of restricted property or upon the exercise of options whose
exercise date has been accelerated) by the Company or any other Person to or
for the benefit of Banker (whether paid or payable or distributed or
distributable pursuant to the terms of this Agreement or otherwise, but
determined without regard to any additional payments required under this
Section 3.9 (a “Payment”) would be subject to the excise tax imposed by Section
4999 of the Code or any similar provision of any federal, state or local law or
any interest or penalties are incurred by Banker with respect to such excise
tax (such excise tax, together with any such interest and penalties, are
hereinafter collectively referred to as the “Excise Tax”), then the Company
shall pay an additional payment, not to exceed the amount of Banker’s then
current Base Salary in the aggregate (a “Gross-Up Payment”), in an amount such
that after payment by Banker of all taxes (including any interest or penalties
imposed with respect to such taxes), including, without limitation, any income
taxes (and any interest and penalties imposed with respect thereto) and Excise
Tax imposed on the Gross-Up Payment, Banker retains an amount of the Gross-Up
Payment equal to fifty percent (50%) of
the Excise Tax imposed on the Payments. Banker will bear the cost of the 

 

                                                remaining fifty
percent (50%) until the aggregate Gross-Up Payments from the Company have
reached the amount of Banker’s then current Base Salary, and will thereafter
bear all additional taxes, interest or penalties.

(c)                                  In the event of
any dispute as to the applicability or amount of any Gross- Up Payment, all
determinations required to be made under this Section 9, including whether and
when a Gross-Up Payment is required and the amount of such Gross-Up Payment and
the assumptions to be utilized in arriving at such determination, shall be made
by the independent public accounting firm regularly employed by the Company
(the “Accounting Firm”) which shall provide detailed supporting calculations
both to the Company and to Banker within 15 business days after the receipt of
notice from Banker that there has been a Payment, or such earlier time as is
requested by the Company. All fees and expenses of the Accounting Firm will be
borne by the Company. If the Accounting Firm determines that no Excise Tax is
payable by Banker, it shall furnish Banker with a written statement that
failure to report the Excise Tax on Banker’s applicable federal income tax
return would not result in the imposition of a negligence or similar penalty.
Any determination by the Accounting Firm shall be binding on the Company and
Banker unless and until a final determination is received from the Internal
Revenue Service indicating a contrary result. As a result of uncertainty in the
application of Section 4999 of the Code at the time of the initial
determination by the Accounting Firm hereunder, it is possible that Gross-Up
Payments may not have been made by the Company that should have been made (“Underpayment”),
consistent with the calculations required to be made hereunder. If Banker
thereafter is required to make a payment of any Excise Tax, the Accounting Firm
shall determine the amount of the Underpayment that has occurred and any such
Underpayment shall be promptly paid by the Company to or for the benefit of
Banker, consistent with the maximum limitation stated in this Section 3.9. In
the event it is determined by the Accounting Firm that the Gross Payments
previously made by the Company exceeded the limitations stated in this Section
3.9, upon written notice from the Company, accompanied by a copy of the
Accounting Firm’s calculation of same, the amount of such overpayment shall be
promptly paid by Banker to the Company.

Article 4

Miscellaneous Provisions

Section 4.1             Entire Agreement.
This Agreement contains the entire Agreement between the Parties and
supersedes all prior oral and written Agreements, understandings, commitments,
or practices between the Parties with respect to the subject matter hereof.
Other than as expressly set forth herein, Banker and the Company acknowledge
and represent that there are no other promises, terms, conditions or
representations (verbal or written) regarding the subject matter of this
Agreement [save and except other possible stock option grant agreements between
the parties which are not affected by this Agreement, except as their vesting
dates may be accelerated pursuant to Section 3.8(a) hereof].  No supplement, modification, or amendment 

 

of any term, provision or condition of this
Agreement shall be binding or enforceable unless evidenced in writing and
executed by the parties. The provisions of Sections 2.3, 2.4, 2.5 and 2.6 shall
survive termination of this Agreement.

Section 4.2             Applicable Law.
This Agreement shall be governed exclusively by and construed in accordance
with the laws of the State of Texas, notwithstanding choice of law provisions
thereof; and the venue of any litigation commenced hereunder shall be Austin,
Texas.

Section 4.3             Injunctive
Relief. Banker acknowledges that his services are of a special,
unique, unusual, extraordinary and intellectual character, which gives them a
peculiar value, the loss of which cannot be reasonably or adequately
compensated in damages in an action at law. 
If he should breach this Agreement, in addition to its rights and
remedies under general law, the Company shall be entitled to seek equitable
relief by way of injunction or otherwise.

Section 4.4             Partial Invalidity. If the
application of any provision of this Agreement, or any section, subsection,
subdivision, sentence, clause, phrase, word or portion of this Agreement should
be held invalid or unenforceable, the remaining provisions thereof shall not be
affected thereby, but shall continue to be given full force and effect as if
the invalid or unenforceable provision had not been included herein.

Section 4.5             Notices.
Notices given under this Agreement shall be given by registered or certified
mail, postage prepaid, return receipt requested, or by personal delivery to the
respective addresses of the parties. Notices to Banker shall be sent to 8200
Bell Mountain Drive,  Austin, Texas 78730. Notices to the Company shall
be sent to 101 Westlake Drive, Austin, Texas 78746, Attn: Board of Directors;
or to such other address as either party shall have designated by proper
written notice to the other party.  A
mailed first-class notice shall be deemed given two (2) business days after
deposit with U.S. Postal Service.

Section 4.6             Counterparts.
This Agreement may be executed in one or more counterparts, each of which shall
be deemed an original, but all of which shall constitute one and the same
instrument.  After this Agreement is duly
executed by all parties, a true, legible copy, image, or facsimile of a fully
executed original shall be just as valid and enforceable as an original.

Section 4.7             Assignment.
This Agreement may not be assigned or encumbered in any way by Banker. The
Company may assign this Agreement to any successor (whether by merger,
consolidation, or purchase of the Company’s stock) to all or a controlling
interest in the Company’s business, in which case this Agreement shall be
binding upon and inure to the benefit of such successor(s) and assign(s).

Section 4.8             Limitation on Waiver.
A waiver of any term, provision, or condition of this Agreement shall not be
deemed to be, or constitute a waiver of any other term, provision or condition
herein, whether or not similar. No waiver shall be binding unless in writing
and signed by the waiving party.

 

Section 4.9             Attorney’s
Fees. In the event that any proceeding is commenced involving
the interpretation or enforcement of the provisions of this Agreement, the
Party prevailing in such proceeding shall be entitled to recover its reasonable
costs, expert witness fees, and attorneys’ fees.

Section 4.10           Arbitration.
If a dispute or claim shall arise with respect to any of the terms or
provisions of this Agreement, or with respect to the performance by either of
the parties under this Agreement, other than in connection with the Company’s
enforcement of the provisions of Sections 2.3, 2.4, 2.5, and 2.6 or pursuant to Section 4.3, then either party may,
by notice as herein provided, require that the dispute be submitted under the
Commercial Arbitration Rules of the American Arbitration Association to an
arbitrator in good standing with the American Arbitration Association within
fifteen (15) days after such notice is given. 
Any dispute as to the arbitrability of any issue shall be submitted to
the arbitrator for decision.  The written
decision of the single arbitrator ultimately appointed by and for both parties
shall be binding and conclusive on the parties, including with respect to any
award of attorneys’ fees, expert witness fees, or costs.  In the event either party does not promptly
comply with the arbitrator’s award, then a judgment may be entered to enforce
the arbitrator’s award in any court having jurisdiction; and the parties
consent to the jurisdiction of the courts of the State of Texas for this
purpose.  Any arbitration undertaken
pursuant to the terms of this section shall occur in the State of Texas.  If a party does not promptly cooperate with
the arbitration process or does not promptly comply with the award of the
arbitrator, the other party may seek relief from a court of proper jurisdiction
and venue to obtain an order compelling the noncompliant party to cooperate
immediately with the arbitration process or to comply immediately with the
award of the arbitrator; and the prevailing party in any such court proceeding
shall be entitled to recover reasonable costs, attorneys’ fees, and expert
witness fees.

Section 4.11           Taxes. All
payments made pursuant to the provisions of this Agreement shall be subject to
the withholding of applicable taxes.

Section 4.12           Not for the Benefit of Creditors or Third Parties. The provisions of this Agreement are intended only for the
regulation of relations among the parties. This Agreement is not intended for
the benefit of creditors of the parties or other third parties and no rights
are wanted to creditors of the parties or other third parties under this
Agreement.

In Witness Whereof, this Agreement is executed as of
the Effective Date.

	
  

  	
  /s/ Jeffrey L. Nash

  
	
   

  	
  Jeffrey L. Nash

  
	
   

  	
   

  	
   

  
	
   

  	
  Treaty Oak Bancorp, Inc.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ Charles
  T. Meeks

  
	
   

  	
   

  	
  Name: Charles T. Meeks

  
	
   

  	
   

  	
  Title: Chairman of the BoardCONFORMED VERSION
  Exhibit 10.1
 

CREDIT
AGREEMENT

dated as of October 31, 2006

among

VERIFONE INTERMEDIATE HOLDINGS, INC.,

VERIFONE, INC.,

THE LENDERS FROM TIME TO TIME PARTY HERETO,

JPMORGAN CHASE BANK, N.A.,

as Administrative Agent, an L/C Issuer and Swing Line Lender,

BANK LEUMI USA and WELLS FARGO BANK, N.A.,

as Co-Documentation Agents,

and

LEHMAN COMMERCIAL PAPER INC.,

as Syndication Agent

J.P. MORGAN SECURITIES INC.

LEHMAN BROTHERS INC.

as Joint Lead Arrangers and Joint Book Managers

   
 

Table
of Contents*

	
  

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ARTICLE I

  	
   

  	
   

  
	
   

  	
   

  	
  DEFINITIONS AND ACCOUNTING TERMS

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 1.01

  	
   

  	
  Defined
  Terms

  	
   

  	
   

  
	
  Section 1.02

  	
   

  	
  Other Interpretative Provisions

  	
   

  	
   

  
	
  Section 1.03

  	
   

  	
  Accounting Terms and Determinations

  	
   

  	
   

  
	
  Section 1.04

  	
   

  	
  Rounding

  	
   

  	
   

  
	
  Section 1.05

  	
   

  	
  References to
  Agreements and Laws

  	
   

  	
   

  
	
  Section
  1.06

  	
   

  	
  Times
  of Day

  	
   

  	
   

  
	
  Section 1.07

  	
   

  	
  Letter of
  Credit Amounts

  	
   

  	
   

  
	
  Section 1.08

  	
   

  	
  Classes and Types of Borrowings

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ARTICLE II

  	
   

  	
   

  
	
   

  	
   

  	
  THE CREDIT
  FACILITIES

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 2.01

  	
   

  	
  Commitments to Lend

  	
   

  	
   

  
	
  Section 2.02

  	
   

  	
  Notice of Borrowings

  	
   

  	
   

  
	
  Section 2.03

  	
   

  	
  Notice to
  Lenders; Funding of Loans

  	
   

  	
   

  
	
  Section 2.04

  	
   

  	
  Evidence of Loans

  	
   

  	
   

  
	
  Section 2.05

  	
   

  	
  Letters of Credit

  	
   

  	
   

  
	
  Section 2.06

  	
   

  	
  Interest

  	
   

  	
   

  
	
  Section 2.07

  	
   

  	
  Extension and
  Conversion

  	
   

  	
   

  
	
  Section 2.08

  	
   

  	
  Maturity of Loans

  	
   

  	
   

  
	
  Section
  2.09

  	
   

  	
  Prepayments

  	
   

  	
   

  
	
  Section 2.10

  	
   

  	
  Adjustment of Commitments

  	
   

  	
   

  
	
  Section 2.11

  	
   

  	
  Fees

  	
   

  	
   

  
	
  Section 2.12

  	
   

  	
  Pro-rata Treatmen

  	
   

  	
   

  
	
  Section 2.13

  	
   

  	
  Sharing of Payment

  	
   

  	
   

  
	
  Section 2.14

  	
   

  	
  Payments; Computations

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ARTICLE III

  	
   

  	
   

  
	
   

  	
   

  	
  TAXES, YIELD
  PROTECTION AND ILLEGALITY

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 3.01

  	
   

  	
  Taxes

  	
   

  	
   

  
	
  Section
  3.02

  	
   

  	
  Illegality

  	
   

  	
   

  
	
  Section 3.03

  	
   

  	
  Inability to
  Determine Rates

  	
   

  	
   

  
	
  Section 3.04

  	
   

  	
  Increased Costs and Reduced Return; Capital Adequacy

  	
   

  	
   

  
	
  Section
  3.05

  	
   

  	
  Funding
  Losses

  	
   

  	
   

  
	
  Section 3.06

  	
   

  	
  Base Rate Loans Substituted for Affected Eurodollar
  Loans

  	
   

  	
   

  
	
  Section 3.07

  	
   

  	
  Survival

  	
   

  	
   

  

*                    The Table of
Contents is not part of the Credit Agreement.

 

 

	
  

  	
   

  	
  ARTICLE IV

  	
   

  	
   

  
	
   

  	
   

  	
  CONDITIONS
  PRECEDENT TO CREDIT EXTENSIONS

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 4.01

  	
   

  	
  Conditions to Initial Credit Extension

  	
   

  	
   

  
	
  Section 4.02

  	
   

  	
  Determination of Conditions to Initial Credit
  Extension

  	
   

  	
   

  
	
  Section 4.03

  	
   

  	
  Conditions to Credit Extension to Fund Cash Merger
  Consideration

  	
   

  	
   

  
	
  Section 4.04

  	
   

  	
  Conditions to All Credit Extensions

  	
   

  	
   

  
	
  Section 4.05

  	
   

  	
  Conditions Precedent to Facilities Increase

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ARTICLE V

  	
   

  	
   

  
	
   

  	
   

  	
  REPRESENTATIONS
  AND WARRANTIES

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 5.01

  	
   

  	
  Existence, Qualification and Power; Compliance with
  Laws

  	
   

  	
   

  
	
  Section 5.02

  	
   

  	
  Authorization; No Contravention

  	
   

  	
   

  
	
  Section 5.03

  	
   

  	
  Governmental Authorization; Other Consents

  	
   

  	
   

  
	
  Section
  5.04

  	
   

  	
  Binding
  Effect

  	
   

  	
   

  
	
  Section 5.05

  	
   

  	
  Financial Condition; No Material Adverse Effect

  	
   

  	
   

  
	
  Section
  5.06

  	
   

  	
  Litigation

  	
   

  	
   

  
	
  Section 5.07

  	
   

  	
  No Default

  	
   

  	
   

  
	
  Section 5.08

  	
   

  	
  Ownership of Property; Liens

  	
   

  	
   

  
	
  Section 5.09

  	
   

  	
  Environmental Compliance

  	
   

  	
   

  
	
  Section 5.10

  	
   

  	
  Insurance

  	
   

  	
   

  
	
  Section 5.11

  	
   

  	
  Taxes

  	
   

  	
   

  
	
  Section 5.12

  	
   

  	
  ERISA; Foreign Pension Plans; Employee Benefit
  Arrangements

  	
   

  	
   

  
	
  Section
  5.13

  	
   

  	
  Subsidiaries

  	
   

  	
   

  
	
  Section 5.14

  	
   

  	
  Margin Regulations; Investment Company Act

  	
   

  	
   

  
	
  Section
  5.15

  	
   

  	
  Disclosure

  	
   

  	
   

  
	
  Section 5.16

  	
   

  	
  Compliance with Law

  	
   

  	
   

  
	
  Section 5.17

  	
   

  	
  Intellectual
  Property

  	
   

  	
   

  
	
  Section 5.18

  	
   

  	
  Purpose of Loans and Letters of Credit

  	
   

  	
   

  
	
  Section
  5.19

  	
   

  	
  Labor
  Matters

  	
   

  	
   

  
	
  Section 5.20

  	
   

  	
  Solvency

  	
   

  	
   

  
	
  Section 5.21

  	
   

  	
  Collateral
  Documents

  	
   

  	
   

  
	
  Section 5.22

  	
   

  	
  Ownership

  	
   

  	
   

  
	
  Section 5.23

  	
   

  	
  Certain
  Transactions

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ARTICLE VI

  	
   

  	
   

  
	
   

  	
   

  	
  AFFIRMATIVE
  COVENANTS

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 6.01

  	
   

  	
  Financial Statements

  	
   

  	
   

  
	
  Section 6.02

  	
   

  	
  Certificates; Other Information

  	
   

  	
   

  
	
  Section 6.03

  	
   

  	
  Notices

  	
   

  	
   

  
	
  Section 6.04

  	
   

  	
  Payment of Obligations

  	
   

  	
   

  
	
  Section 6.05

  	
   

  	
  Preservation of Existence Etc.; Compliance

  	
   

  	
   

  
	
  Section 6.06

  	
   

  	
  Maintenance of Properties

  	
   

  	
   

  
	
  Section 6.07

  	
   

  	
  Insurance; Certain Proceeds

  	
   

  	
   

  
	
  Section 6.08

  	
   

  	
  Compliance with Laws

  	
   

  	
   

  
	
  Section 6.09

  	
   

  	
  Books and Records; Lender Meeting

  	
   

  	
   

  
	
  Section 6.10

  	
   

  	
  Inspection Rights

  	
   

  	
   

  
	
  Section
  6.11

  	
   

  	
  Use
  of Proceeds

  	
   

  	
   

  

 

 ii
 

 

 

	
  Section 6.12

  	
   

  	
  Additional Loan Parties; Additional Security

  	
   

  	
   

  
	
  Section 6.13

  	
   

  	
  Interest Rate Protection Agreements

  	
   

  	
   

  
	
  Section
  6.14

  	
   

  	
  Contributions

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ARTICLE VII

  	
   

  	
   

  
	
   

  	
   

  	
  NEGATIVE COVENANTS

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 7.01

  	
   

  	
  Limitation on Indebtedness

  	
   

  	
   

  
	
  Section 7.02

  	
   

  	
  Restriction on Liens

  	
   

  	
   

  
	
  Section 7.03

  	
   

  	
  Nature of Business

  	
   

  	
   

  
	
  Section 7.04

  	
   

  	
  Consolidation, Merger and Dissolution

  	
   

  	
   

  
	
  Section 7.05

  	
   

  	
  Asset Dispositions

  	
   

  	
   

  
	
  Section
  7.06

  	
   

  	
  Investments

  	
   

  	
   

  
	
  Section 7.07

  	
   

  	
  Restricted Payments, etc.

  	
   

  	
   

  
	
  Section 7.08

  	
   

  	
  Payments of Indebtedness, etc.

  	
   

  	
   

  
	
  Section 7.09

  	
   

  	
  Transactions with Affiliates

  	
   

  	
   

  
	
  Section 7.10

  	
   

  	
  Fiscal Year; Organizational and Other Documents

  	
   

  	
   

  
	
  Section 7.11

  	
   

  	
  Restrictions with Respect to Intercorporate Transfers

  	
   

  	
   

  
	
  Section 7.12

  	
   

  	
  Ownership of Subsidiaries; Limitations on Certain
  Activities

  	
   

  	
   

  
	
  Section 7.13

  	
   

  	
  Sale and Leaseback Transactions

  	
   

  	
   

  
	
  Section 7.14

  	
   

  	
  Capital Expenditures

  	
   

  	
   

  
	
  Section 7.15

  	
   

  	
  Additional Negative Pledges

  	
   

  	
   

  
	
  Section 7.16

  	
   

  	
  Impairment of Security Interests

  	
   

  	
   

  
	
  Section 7.17

  	
   

  	
  Financial Covenants

  	
   

  	
   

  
	
  Section 7.18

  	
   

  	
  Independence of Covenants

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ARTICLE VIII

  	
   

  	
   

  
	
   

  	
   

  	
  DEFAULTS

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 8.01

  	
   

  	
  Events of Default

  	
   

  	
   

  
	
  Section 8.02

  	
   

  	
  Acceleration; Remedies

  	
   

  	
   

  
	
  Section 8.03

  	
   

  	
  Application of Funds

  	
   

  	
   

  
	
  Section 8.04

  	
   

  	
  Rescission of Events of Default

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ARTICLE IX

  	
   

  	
   

  
	
   

  	
   

  	
  AGENCY PROVISIONS

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 9.01

  	
   

  	
  Appointment and Authorization of the Agents

  	
   

  	
   

  
	
  Section 9.02

  	
   

  	
  Delegation of Duties

  	
   

  	
   

  
	
  Section 9.03

  	
   

  	
  Exculpatory Provisions

  	
   

  	
   

  
	
  Section 9.04

  	
   

  	
  Reliance on Communications

  	
   

  	
   

  
	
  Section 9.05

  	
   

  	
  Notice of Default

  	
   

  	
   

  
	
  Section 9.06

  	
   

  	
  Credit Decision; Disclosure of Information by
  Administrative Agent; No Reliance on Arrangers’ or Agents’ Customer
  Identification Program

  	
   

  	
   

  
	
  Section 9.07

  	
   

  	
  Indemnification

  	
   

  	
   

  
	
  Section 9.08

  	
   

  	
  Agents in Their Individual Capacity

  	
   

  	
   

  
	
  Section 9.09

  	
   

  	
  Successor Agents

  	
   

  	
   

  
	
  Section 9.10

  	
   

  	
  Administrative Agent May File Proofs of Claim

  	
   

  	
   

  
	
  Section 9.11

  	
   

  	
  Collateral and Guaranty Matters

  	
   

  	
   

  
	
  Section 9.12

  	
   

  	
  Related Obligations

  	
   

  	
   

  

 

 iii
 

 

 

	
  Section 9.13

  	
   

  	
  Other Agents;
  Arrangers and Managers

  	
   

  	
   

  
	
  Section 9.14

  	
   

  	
  Agents’ Fees; Arranger Fee

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ARTICLE X

  	
   

  	
   

  
	
   

  	
   

  	
  MISCELLANEOUS

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section
  10.01

  	
   

  	
  Amendments,
  Etc.

  	
   

  	
   

  
	
  Section 10.02

  	
   

  	
  Notices and Other Communications; Facsimile Copies

  	
   

  	
   

  
	
  Section 10.03

  	
   

  	
  No Waiver; Cumulative Remedies

  	
   

  	
   

  
	
  Section 10.04

  	
   

  	
  Attorney Costs, Expenses and Taxes

  	
   

  	
   

  
	
  Section 10.05

  	
   

  	
  Indemnification

  	
   

  	
   

  
	
  Section 10.06

  	
   

  	
  Payments Set Aside

  	
   

  	
   

  
	
  Section 10.07

  	
   

  	
  Successors and Assigns

  	
   

  	
   

  
	
  Section 10.08

  	
   

  	
  Confidentiality

  	
   

  	
   

  
	
  Section 10.09

  	
   

  	
  Set-off

  	
   

  	
   

  
	
  Section 10.10

  	
   

  	
  Interest Rate Limitation

  	
   

  	
   

  
	
  Section
  10.11

  	
   

  	
  Counterparts

  	
   

  	
   

  
	
  Section
  10.12

  	
   

  	
  Integration

  	
   

  	
   

  
	
  Section 10.13

  	
   

  	
  Survival of Representations and Warranties

  	
   

  	
   

  
	
  Section
  10.14

  	
   

  	
  Severability

  	
   

  	
   

  
	
  Section 10.15

  	
   

  	
  Tax Forms

  	
   

  	
   

  
	
  Section 10.16

  	
   

  	
  Headings

  	
   

  	
   

  
	
  Section 10.17

  	
   

  	
  Governing Law; Submission to Jurisdiction

  	
   

  	
   

  
	
  Section 10.18

  	
   

  	
  Waiver of Right to Trial by Jury

  	
   

  	
   

  
	
  Section 10.19

  	
   

  	
  USA Patriot Act Notice; Lenders’ Compliance
  Certification

  	
   

  	
   

  
	
  Section 10.20

  	
   

  	
  Defaulting Lenders

  	
   

  	
   

  
	
  Section
  10.21

  	
   

  	
  Binding
  Effect

  	
   

  	
   

  
	
  Section 10.22

  	
   

  	
  Judgment Currency

  	
   

  	
   

  
	
  Section 10.23

  	
   

  	
  Conflict

  	
   

  	
   

  

 

	
  Schedules:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Schedule 1.01A

  	
   

  	
  —

  	
   

  	
  Consolidated EBITDA

  
	
  Schedule 1.01B

  	
   

  	
  —

  	
   

  	
  Refinanced Agreements

  
	
  Schedule 2.01

  	
   

  	
   

  	
   

  	
  Lenders and Commitments

  
	
  Schedule 5.05

  	
   

  	
  —

  	
   

  	
  Certain Acquisitions

  
	
  Schedule 5.06

  	
   

  	
  —

  	
   

  	
  Litigation

  
	
  Schedule 5.12

  	
   

  	
  —

  	
   

  	
  ERISA

  
	
  Schedule 5.13

  	
   

  	
  —

  	
   

  	
  Subsidiaries

  
	
  Schedule 5.16

  	
   

  	
  —

  	
   

  	
  Compliance with Law

  
	
  Schedule 5.17

  	
   

  	
  —

  	
   

  	
  Intellectual Property

  
	
  Schedule 5.22

  	
   

  	
  —

  	
   

  	
  Ownership

  
	
  Schedule 5.23

  	
   

  	
  —

  	
   

  	
  Broker’s Fees

  
	
  Schedule 7.01

  	
   

  	
  —

  	
   

  	
  Indebtedness

  
	
  Schedule 7.02

  	
   

  	
  —

  	
   

  	
  Existing Liens

  
	
  Schedule 7.06

  	
   

  	
  —

  	
   

  	
  Existing Investments

  
	
  Schedule 10.02

  	
   

  	
  —

  	
   

  	
  Administrative Agent’s Office, Certain Addresses for
  Notices

  

 

 iv
 

 

 

	
  Exhibits:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit A-1

  	
   

  	
  —

  	
   

  	
  Form of Notice of Borrowing

  
	
  Exhibit A-2

  	
   

  	
  —

  	
   

  	
  Form of Notice of Extension/Conversion

  
	
  Exhibit A-3

  	
   

  	
  —

  	
   

  	
  Form of Letter of Credit Request

  
	
  Exhibit A-4

  	
   

  	
  —

  	
   

  	
  Form of Swing Line Loan Request

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit B-1

  	
   

  	
  —

  	
   

  	
  Form of Revolving Note

  
	
  Exhibit B-2

  	
   

  	
  —

  	
   

  	
  Form of Term B Note

  
	
  Exhibit B-3

  	
   

  	
  —

  	
   

  	
  Form of Swing Line Note

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit C

  	
   

  	
  —

  	
   

  	
  Form of Assignment and Assumption

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit D

  	
   

  	
  —

  	
   

  	
  Form of Compliance Certificate

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit E

  	
   

  	
  —

  	
   

  	
  Form of Opinion of Counsel for the Borrower and the
  Other Loan Parties

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit F

  	
   

  	
  —

  	
   

  	
  Form of Guaranty

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit G-1

  	
   

  	
  —

  	
   

  	
  Form of Security Agreement

  
	
  Exhibit G-2

  	
   

  	
  —

  	
   

  	
  Form of Pledge Agreement

  
	
  Exhibit G-3

  	
   

  	
  —

  	
   

  	
  Form of Perfection Certificate

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit H

  	
   

  	
  —

  	
   

  	
  Form of Intercompany Note

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit I

  	
   

  	
  —

  	
   

  	
  Form of Intercompany Note Subordination Provisions

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit J

  	
   

  	
  —

  	
   

  	
  Form of Loan Party Accession Agreement

  

 

 v

 

CREDIT
AGREEMENT

This Credit Agreement is entered into as of October
31, 2006 among VERIFONE INTERMEDIATE HOLDINGS, INC., a Delaware corporation (“Holdings”),
VERIFONE, INC., a Delaware corporation (the “Borrower”), each lender
from time to time party hereto (collectively, the “Lenders” and,
individually, a “Lender”), JPMORGAN CHASE BANK, N.A., as Administrative
Agent for the Lenders, as Swing Line Lender and as an L/C Issuer, BANK LEUMI
USA AND WELLS FARGO BANK, N.A., as Co-Documentation Agents, and LEHMAN
COMMERCIAL PAPER INC., as Syndication Agent.

Holdings and the Borrower have requested that the
Lenders extend credit in the form of (i) Term B Loans (such term and each other
capitalized term used but not defined in this introductory statement having the
meaning assigned thereto in Article I) in an aggregate principal amount
not in excess of $500,000,000 and (ii) Revolving Loans in an aggregate
principal amount at any time outstanding not in excess of $40,000,000
(including Swing Line Loans in an aggregate principal amount at any time
outstanding not in excess of $20,000,000 and Letters of Credit in an aggregate
face amount at any time outstanding not in excess of $20,000,000).  In addition, the Borrower may request a
Facilities Increase in the aggregate amount of Term B Loans and Revolving
Commitments pursuant to Section 2.10(a) from time to time after the
Closing Date in an aggregate amount not to exceed $200,000,000.

The Term B Loans will be advanced in two drawings, the
proceeds of which will be used (i) to repay the outstanding principal and all
other amounts due pursuant to the Credit
Agreement dated as of June 30, 2004, as amended as of March 23, 2005 and
September 7, 2005, among the Borrower, Holdings, the Lenders (as defined
therein) from time to time party thereto, Bank of America, N.A., as
Administrative Agent, Senior Collateral Agent, Second Lien Collateral Agent,
L/C Issuer and Swing Line Lender, Credit Suisse First Boston, Cayman Islands
Branch, as Syndication Agent, and Wells Fargo Bank, N.A., as Documentation
Agent (the “Existing Credit Agreement”), (ii) to pay or provide for the
payment of Transaction costs and (iii) to fund the cash consideration payable
in connection with the merger of Lion Acquisitions Ltd., an Israeli corporation
and a direct Wholly-Owned Subsidiary of the Borrower (“Merger Sub”),
pursuant to the Merger Documents through which the Borrower intends to acquire
Lipman with Lipman surviving as a direct Wholly-Owned Subsidiary of the
Borrower, and to repay outstanding indebtedness of Lipman under the Refinanced
Agreements.

The Lenders and the L/C Issuers are willing to make
the requested credit facilities available on the terms and conditions set forth
herein.  Accordingly, in consideration of
the mutual covenants and agreements herein contained, the parties hereto
covenant and agree as follows:

ARTICLE I

DEFINITIONS AND ACCOUNTING TERMS

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

“Accession Agreement” means a Loan Party
Accession Agreement, substantially in the form of Exhibit J hereto,
executed and delivered by an Additional Subsidiary Guarantor after the Closing
Date in accordance with Section 6.12(a) or (d).

“Additional Collateral Documents” has the
meaning specified in Section 6.12(b).

“Additional Subsidiary Guarantor” means each
Person that becomes a Subsidiary Guarantor after the Closing Date by execution
of an Accession Agreement as provided in Section 6.12.

 

“Adjusted Eurodollar Rate” means, for the Interest
Period for each Eurodollar Loan comprising part of the same Group, the quotient
obtained (rounded upward, if necessary, to the next higher 1/100th of 1%) by dividing (i) the applicable
Eurodollar Rate for such Interest Period by (ii) 1.00 minus the Eurodollar
Reserve Percentage.

“Administrative Agent” means JPMCB in its
capacity as administrative agent under any of the Loan Documents, or any
successor administrative agent appointed in accordance with Section 9.09.

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

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

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

“Agent” means the Administrative Agent, a
Co-Documentation Agent, the Syndication Agent or the Collateral Agent and any
successors and assigns in such capacity appointed in accordance with Section
9.09, and “Agents” means any two or more of them.

“Agent-Related Persons” means the
Administrative Agent and the Collateral Agent, together with their respective
Affiliates (including, in the case of JPMCB in its capacity as the
Administrative Agent, J.P. Morgan Securities Inc.), and the officers,
directors, employees, agents and attorneys-in-fact of such Persons and
Affiliates.

“Agreement” means this Credit Agreement, as
amended, modified or supplemented from time to time.

“Anti-Terrorism Laws” means any Laws relating
to terrorism or money-laundering, including, without limitation, (i) Executive
Order No. 13224 on Terrorist Financing, effective September 24, 2001 and
relating to Blocking Property and Prohibiting Transactions with Persons Who
Commit, Threaten to Commit, or Support Terrorism, (ii) the U.S. Patriot Act,
(iii) the International Emergency Economic Power Act, 50 U.S.C. §1701 et seq.,
(iv) the Bank Secrecy Act, (v) the Trading with the Enemy Act, 50 U.S.C. App. 1
et seq. and (vi) any related rules and regulations of the U.S. Treasury
Department’s Office of Foreign Assets Control or any other Governmental
Authority, in each case as the same may be amended, supplemented, modified,
replaced or otherwise in effect from time to time.

“Applicable Lending Office” means (i) with respect
to any Lender and for each Type of Loan, the “Lending Office” of such Lender
(or of an Affiliate of such Lender) designated for such Type of Loan in such
Lender’s Administrative Questionnaire or in any applicable Assignment and
Assumption pursuant to which such Lender became a Lender hereunder or such
other office of such Lender (or of an Affiliate of such Lender) as such Lender
may from time to time specify to the Administrative Agent and the Borrower as
the office by which its Loans of such Type are to be made and maintained and
(ii) with respect to any L/C Issuer and for each Letter of Credit, the “Lending
Office” of such L/C Issuer (or of an Affiliate of such L/C Issuer) designated
on the signature pages hereto or such other office of such L/C Issuer (or of an
Affiliate of such L/C Issuer) as such L/C Issuer may from time to time specify
to the Administrative Agent and the Borrower as the office by which its Letters
of Credit are to be issued and maintained.

 2
 

 

“Applicable Margin” means a percentage per
annum equal to:

(a)           With respect to
Revolving Loans, (i) until delivery of the Compliance Certificate received by
the Administrative Agent pursuant to Section 6.02(b) for the first
fiscal quarter of Parent Holdings ending after the Closing Date, 1.50% if such
Loans are Eurodollar Loans and 0.50% if such Loans are Base Rate Loans and (ii)
thereafter, the following percentages based upon the Total Leverage Ratio as
set forth in the most recent Compliance Certificate received by the
Administrative Agent pursuant to Section 6.02(b):

	
  Applicable Margin for Revolving Loans

  
	
  Pricing Level

  	
   

  	
  Total Leverage Ratio

  	
   

  	
  Eurodollar Rate

  	
   

  	
  Base Rate

  	
   

  
	
  1

  	
   

  	
  3 3.00:1

  	
   

  	
  1.500

  	
  %

  	
  0.500

  	
  %

  
	
  2

  	
   

  	
  < 3.00:1 but 3
  2.50:1

  	
   

  	
  1.375

  	
  %

  	
  0.375

  	
  %

  
	
  3

  	
   

  	
  < 2.50:1

  	
   

  	
  1.250

  	
  %

  	
  0.250

  	
  %

  

 

(b)           With respect to Term
B Loans, 1.75% if such Loans are Eurodollar Loans and 0.75% if such Loans are
Base Rate Loans.

(c)           With respect to (i)
the Commitment Fee to be paid pursuant to Section 2.11(a) and (ii) the
Standby Letter of Credit Fee and the Trade Letter of Credit Fee (each an “L/C
Fee”) to be paid pursuant to Section 2.11(b), in each case (A) until
delivery of the Compliance Certificate received by the Administrative Agent
pursuant to Section 6.02(b) for the first fiscal quarter of Parent
Holdings ending after the Closing Date, the Commitment Fee shall be 0.375% per
annum and each L/C Fee shall be 1.50% per annum and (B) thereafter, the
following percentages per annum based upon the Total Leverage Ratio as set
forth below:

	
  Commitment Fee and L/C Fee

  
	
  Pricing Level

  	
   

  	
  Total Leverage Ratio

  	
   

  	
  Commitment Fee

  	
   

  	
  L/C Fee

  	
   

  
	
  1

  	
   

  	
  3 3.00:1

  	
   

  	
  0.375

  	
  %

  	
  1.500

  	
  %

  
	
  2

  	
   

  	
  < 3.00:1 but 3
  2.50:1

  	
   

  	
  0.350

  	
  %

  	
  1.375

  	
  %

  
	
  3

  	
   

  	
  < 2.50:1

  	
   

  	
  0.300

  	
  %

  	
  1.250

  	
  %

  

 

Any increase or decrease in the Applicable Margin
resulting from a change in the Total Leverage Ratio shall become effective as
of the first Business Day immediately following the date a Compliance
Certificate is delivered pursuant to Section 6.02(b); provided that (i) at the option of the
Administrative Agent or the Required Revolving Lenders, Pricing Level 1 (with
respect to Revolving Credit Loans, the Commitment Fee and the L/C Fee) shall
apply as of the first Business Day after the date on which a Compliance
Certificate was required to have been delivered but was not delivered, and
shall continue to so apply to and including the date on which such Compliance
Certificate is so delivered (and thereafter the pricing otherwise determined in
accordance with this definition shall apply) and (ii) if the Total Leverage
Ratio as set forth in a Compliance Certificate delivered pursuant to Section
6.02(b) is determined to have been incorrect, then the Applicable Margin
for the relevant period shall be adjusted retroactively to reflect the pricing
which would have been applied in accordance with this definition for such
period based on the corrected Total Leverage Ratio for the relevant period, and
any additional interest or fees owing as a result of such readjustment shall be
payable on demand.

 3
 

 

“Approved Fund” has the meaning specified in Section
10.07(g).

“Asset Disposition” means any sale, (including
any Sale/Leaseback Transaction, whether or not involving a Capital Lease),
lease, transfer or other disposition (including any such transaction involving
a transfer of assets effected by way of merger or consolidation and including
any sale or other disposition by any Group Company of Equity Interests in one
or more of its Subsidiaries, but excluding any sale or other disposition by way
of Casualty or Condemnation) by any Group Company of any asset.  For avoidance of doubt, an Equity Issuance by
any Person shall not constitute an Asset Disposition.

“Assignee Group” means two or more Eligible
Assignees that are Affiliates of one another or two or more Approved Funds
managed by the same investment advisor.

“Assignment and Assumption” means an Assignment
and Assumption, substantially in the form of Exhibit C hereto.

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

“Attributable Indebtedness” means, at any date,
(i) in respect of any Capital Lease of any Person, the capitalized amount
thereof that would appear on a balance sheet as Indebtedness of such Person
prepared as of such date in accordance with GAAP, (ii) in respect of any
Synthetic Lease Obligation of any Person, the capitalized or principal amount
of the remaining lease payments under the relevant lease that would appear on a
balance sheet as Indebtedness of such Person prepared as of such date in
accordance with GAAP if such lease or other agreement were accounted for as a
Capital Lease and (iii) in respect of any Sale/Leaseback Transaction, the
lesser of (A) the present value, discounted in accordance with GAAP at the
interest rate implicit in the related lease, of the obligations of the lessee
for net rental payments over the remaining term of such lease (including any
period for which such lease has been extended or may, at the option of the lessor
be extended) and (B) the fair market value of the assets subject to such
transaction.

“Audited Financial Statements” means the
audited consolidated balance sheet of Parent Holdings and its Consolidated
Subsidiaries for the fiscal year ended October 31, 2005 and the related
consolidated statements of income or operations, shareholders’ equity and cash
flows for such fiscal year of Parent Holdings and its Consolidated
Subsidiaries, including the notes thereto, included in Parent Holdings’ Annual
Report on Form 10-K for the year ended October 31, 2005, filed with the SEC.

“Auto-Extension Letter of Credit” has the
meaning specified in Section 2.05(c).

“Availability Period” means (i) in respect of
the Revolving Commitments, the period from and including the Closing Date to
the earliest of (A) the Revolving Termination Date, (B) the time of the
termination of the Revolving Commitments pursuant to Section 2.10 and
(C) the time of termination of the commitment of each Lender to make Loans and
of the obligation of the L/C Issuers issue, extend or increase Letters of
Credit pursuant to Section 8.02 and (ii) in respect of the Term B
Commitments, the period from and including the Closing Date and ending at the
earliest of (A) 5:00 PM (local time in New York City) on the third Business Day
after the date of the initial Term B Borrowing, (B) the time of the termination
of the Term B Commitments pursuant to Section 2.10 and (C) the time of
the termination of the Term B Commitments pursuant to Section 8.02.

“Bank Secrecy Act” means the Financial
Recordkeeping and Reporting of Currency and Foreign Transactions Act of 1970,
31 U.S.C. 1051, et seq., as the same may be amended, supplemented, modified,
replaced or otherwise in effect from time to time.

 4
 

 

“Base Rate” means, for any day, a rate per
annum equal to the higher of (i) the Federal Funds Rate plus 1⁄2 of 1% and (ii)
the rate of interest in effect for such day as publicly announced from time to
time by JPMCB as its “prime rate” in effect at its office located at 270 Park Avenue,
New York, New York.  The “prime rate” is
a rate set by JPMCB based upon various factors including JPMCB’s costs and
desired return, general economic conditions and other factors, and is used as a
reference point for pricing some loans, which may be priced at, above or below
such announced rate.  Any change in such
rate announced by JPMCB shall be effective from and including the date such
change is publicly announced as being effective.

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

“Borrower” means VeriFone, Inc., a Delaware
corporation, and its successors.

“Borrowing” has the meaning specified in Section
1.08.

“Business Acquisition” means the acquisition by
the Borrower or one or more of its Wholly-Owned Subsidiaries of all of the
Equity Interests, assets or property of another Person (or any division, line
of business or any substantial part thereof).

“Business Day” means any day other than a
Saturday, Sunday or other day on which commercial banks are authorized to close
under the Laws of, or are in fact closed in, the state where the Administrative
Agent’s Office is located, except that (i) when used in Section 2.05
with respect to any action taken by or with respect to any L/C Issuer, the term
“Business Day” shall not include any day on which commercial banks are
authorized to close under the Laws of, or are in fact closed in, the
jurisdiction where such L/C Issuer’s Applicable Lending Office is located, and
(ii) if such day relates to a borrowing of, a payment or prepayment of
principal of or interest on, or the Interest Period for, a Eurodollar Loan, or
a notice by the Borrower with respect to any such borrowing, payment,
prepayment or Interest Period, such day shall also be a day on which dealings
in Dollar deposits are conducted by and between banks in the London interbank
eurodollar market.

“Capital Lease” of any Person means any lease
of (or other arrangement conveying the right to use) property (whether real,
personal or mixed) by such Person as lessee which would, in accordance with
GAAP, be required to be accounted for as a capital lease on the balance sheet
of such Person.

“Capital Lease Obligations” means, with respect
to any Person, all obligations of such Person as lessee under Capital Leases,
in each case taken at the amount thereof accounted for as liabilities in
accordance with GAAP.

“Cash Collateralize” means to pledge and
deposit with or deliver to the Collateral Agent, for the benefit of the L/C
Issuers and the Revolving Lenders, as collateral for the L/C Obligations, cash
or deposit balances pursuant to documentation in form and substance reasonably
satisfactory to the Administrative Agent and the L/C Issuers.

“Cash Equivalents” means:

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

 5
 

 

(ii)           Dollar-denominated certificates of
deposit of (A) any Lender, (B) any domestic commercial bank of recognized
standing having capital and surplus in excess of $500,000,000 or (C) any bank
whose short-term commercial paper rating from (w) S&P is at least A-1 or the
equivalent thereof, (x) Moody’s is at least P-1 or the equivalent thereof, (y)
DRC is at least D-1 or the equivalent thereof, or (z) Fitch is at least F1 or
the equivalent thereof (any such bank being an “Approved Lender”), in
each case with maturities of not more than one year from the date of
acquisition;

(iii)          commercial paper and variable or fixed
rate notes issued by any Approved Lender (or by the parent company thereof) or
any variable rate notes issued by, or guaranteed by, any domestic corporation
not an Affiliate of the Borrower rated (w) A-1 (or the equivalent thereof) or
better by S&P, (x) P-1 (or the equivalent thereof) or better by Moody’s,
(y) D-1 (or the equivalent thereof) or better by DRC, or (z) F1 (or the
equivalent thereof) or better by Fitch, and maturing within 270 days of the
date of acquisition;

(iv)          repurchase agreements with a term of
not more than one year with a bank or trust company (including any of the
Lenders) or recognized securities dealer having capital and surplus in excess
of $500,000,000 for direct obligations issued by or fully guaranteed by the
United States of America in which the Borrower or one or more of its
Subsidiaries shall have a perfected first priority security interest (subject
to no other Liens) and having, on the date of purchase thereof, a fair market
value of at least 100% of the amount of the repurchase obligations;

(v)           investments, classified in accordance
with GAAP as current assets, in money market investment programs registered
under the Investment Company Act of 1940, as amended, which are administered by
reputable financial institutions having capital of at least $500,000,000 and
the portfolios of which are limited to Investments of the character described
in the foregoing clauses (i) through (iv); and

(vi)          auction rate securities, corporate
bonds, taxable municipal bonds, tax-exempt municipal bonds and money market
funds, in each case, having a maturity within one year of the date of
acquisition thereof, so long as such investments are rated at least AAA or the
functional equivalent by at least two of the following: (A) S&P, (B) Moody’s,
(C) DRC, and (D) Fitch.

“Cash Management Agreement” means any agreement
or other instrument governing Cash Management Obligations between one or more
Loan Parties and a Cash Management Bank.

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

“Cash Management Obligation” means, as applied
to any Person, any direct or indirect liability, contingent or otherwise, of
such Person in respect of cash management services (including treasury,
depository, overdraft, credit or debit card, electronic funds transfer and
other cash management arrangements) provided by any Lender or its Affiliates in
connection with any Loan Document, including obligations for the payment of
agreed interest and reasonable, fees, charges, expenses, Attorney Costs and
disbursements in connection therewith.

“Cash on Hand” means, at any date, the amount
in excess of $10,000,000 of cash and Cash Equivalents of Holdings and its
Wholly-Owned Subsidiaries on such date, it being understood that 

 6
 

 

“Cash on Hand” shall (i)
exclude in any event any cash and Cash Equivalents which are “restricted” for
purposes of GAAP or are subject to a consensual Lien in favor of any other
Person (other than security interests under the Collateral Documents) and (ii)
in the case of Foreign Subsidiaries, be limited to 75.0% of their cash and Cash
Equivalents.

“Casualty” means any casualty, loss, damage,
destruction or other similar loss with respect to real or personal property or
improvements.

“Casualty Insurance Policy” means any insurance
policy maintained by any Group Company covering losses with respect to
Casualties.

“Change of Control” means the occurrence of any
of the following events:

(i)            (A) Parent Holdings or Holdings
shall cease to own, directly or indirectly, 100% of the Equity Interests in the
Borrower on a fully-diluted basis assuming the conversion and exercise of all
outstanding Equity Equivalents (whether or not such securities are then
currently convertible or exercisable), or (B) any “person” or “group” (within
the meaning of Section 13(d) or 14(d) of the Exchange Act) has become the “beneficial
owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that
a Person shall be deemed to have “beneficial ownership” of all securities that
any such Person has the right to acquire, whether such right is exercisable
immediately or only after the passage of time), by way of merger, consolidation
or otherwise, of 35% or more of the Equity Interests of Parent Holdings on a
fully-diluted basis after giving effect to the conversion and exercise of all
outstanding Equity Equivalents (whether or not such securities are then
currently convertible or exercisable); or

(ii)           during any period of two consecutive
calendar years, individuals who at the beginning of such period constituted the
board of directors (or persons performing similar functions) of Parent Holdings
together with any new members of such board of directors whose elections by
such board of directors or whose nominations for election by the stockholders
of Parent Holdings was approved by a vote of a majority of the members of such
board of directors then still in office who either were directors at the
beginning of such period or whose election or nomination for election was
previously so approved (excluding any individual whose initial nomination for, or
assumption of office as, a member of such board of directors occurs as a result
of an actual or threatened solicitation of proxies or consents for the election
or removal of one or more directors by any person or group other than a
solicitation for the election of one or more directors by or on behalf of the
board of directors) cease for any reason to constitute a majority of the
directors of Parent Holdings still in office.

“Class” has the meaning specified in Section
1.08.

“Closing Date” means the date on or after the
Effective Date when the first Credit Extension occurs in accordance with Section
4.01.

“Code” means the Internal Revenue Code of 1986,
as amended, and any successor statute thereto, as interpreted by the rules and
regulations issued thereunder, in each case as in effect from time to time.

“Co-Documentation Agent” means each of Bank
Leumi USA and Wells Fargo Bank, N.A., in its capacity as a Co-Documentation
Agent under this Agreement, and “Co-Documentation Agents” means all of
them, collectively.

 7

 

“Collateral” means all of the property which is
subject or is purported to be subject to the Liens granted by the Collateral
Documents.

“Collateral Agent” means JPMCB, as Collateral
Agent for the Lenders under this Agreement and the Collateral Documents, and
its permitted successor or successors in such capacity and, if there is no
acting Collateral Agent under this Agreement and the Collateral Documents, the
Required Lenders.

“Collateral Documents” means, collectively, the
Security Agreement, the Pledge Agreement, the Depositary Bank Agreements, any
Additional Collateral Documents, any additional pledges, security agreements,
patent, trademark or copyright filings or mortgages required to be delivered
pursuant to the Loan Documents and any instruments of assignment, control
agreements or other instruments or agreements executed pursuant to the
foregoing.

“Commitment” means (i) with respect to each
Lender, its Revolving Commitment and/or Term B Commitment, as and to the extent
applicable, (ii) with respect to each L/C Issuer, its L/C Commitment and (iii)
with respect to the Swing Line Lender, the Swing Line Commitment, in each case
as set forth on Schedule 2.01 or in the applicable Assignment and
Assumption pursuant to which such Lender becomes a party hereto, as applicable,
as its Commitment of the applicable Class, as any such amount may be adjusted
from time to time in accordance with this Agreement.

“Commitment Fee” has the meaning specified in Section
2.11(a).

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

“Condemnation” means any taking by a
Governmental Authority of property or assets, or any part thereof or interest
therein, for public or quasi-public use under the power of eminent domain, by
reason of any public improvement or condemnation or in any other manner.

“Condemnation Award” means all proceeds of any
Condemnation.

“Consolidated Adjusted Working Capital” means
at any date the excess of (i) Consolidated Current Assets (excluding cash and
Cash Equivalents classified as such in accordance with GAAP) over (ii)
Consolidated Current Liabilities (excluding the current portion of any
Consolidated Funded Indebtedness).

“Consolidated Capital Expenditures” means for
any period the aggregate amount of all expenditures (whether paid in cash or
other consideration or accrued as a liability) that would, in accordance with
GAAP, be included as additions to property, plant and equipment and other
capital expenditures of Holdings and its Consolidated Subsidiaries for such
period, excluding interest capitalized during construction, in each case as the
same are or would be set forth in a consolidated statement of cash flows of
Holdings and its Consolidated Subsidiaries for such period (including the
amount of assets leased under any Capital Lease), but excluding (to the extent
that they would otherwise be included) (i) any such expenditures made for the
replacement or restoration of assets to the extent paid for by any Casualty
Insurance Policy or Condemnation Award with respect to the asset or assets
being replaced or restored to the extent such expenditures are permitted under
the Loan Documents, (ii) any such expenditures made with proceeds of a
Qualifying Equity Issuance or to the extent that Holdings or any of its Consolidated
Subsidiaries has received or will receive reimbursement in cash from a third
party other than Holdings or one or more if its Consolidated Subsidiaries and
(iii) for purposes of Section 7.14 only, capital expenditures for
Permitted Business Acquisitions and Permitted Joint Ventures.

 8
 

 

“Consolidated Cash Interest Expense” means for
any period Consolidated Interest Expense that has been paid or is payable in
cash for such period other than (to the extent, but only to the extent,
included in the determination of Consolidated Interest Expense for such period
in accordance with GAAP and paid in cash for such period):  (i) amortization of debt discount and debt
issuance fees, (ii) any fees (including underwriting fees and expenses) paid in
connection with the consummation of the Transaction or Permitted Business
Acquisitions, (iii) any payments made or expenses incurred to obtain Swap
Agreements, (iv) any fees paid or required to be paid pursuant to any Loan
Document and (v) annual agency fees, unused line fees and letter of credit fees
and expenses paid hereunder; provided that Consolidated Cash Interest
Expense for any period of four fiscal quarters ending on the last day of the
first, second or third fiscal quarters of Holdings first ending after the
Closing Date shall be deemed equal to the product of (i) Consolidated Cash
Interest Expense computed in accordance with the requirements of this
definition for such one, two or three quarter period multiplied by (ii) a
fraction, the numerator of which is four and the denominator of which is the
number of such fiscal quarters ended after the Closing Date.

“Consolidated Cash Taxes” means for any period
the aggregate amount of all taxes of Holdings and its Consolidated Subsidiaries
for such period to the extent the same are paid in cash by Holdings or any
Consolidated Subsidiary of Holdings during such period; provided that
Consolidated Cash Taxes for any period of four fiscal quarters ending on the
last day of the first, second or third fiscal quarters of Holdings first ending
after the Closing Date shall be deemed equal to the product of (i) Consolidated
Cash Taxes computed in accordance with the requirements of this definition for
such one, two or three quarter period multiplied by (ii) a fraction, the
numerator of which is four and the denominator of which is the number of such
fiscal quarters ended after the Closing Date.

“Consolidated Current Assets” means at any date
the consolidated current assets of Holdings and its Consolidated Subsidiaries
determined as of such date in accordance with GAAP.

“Consolidated Current Liabilities” means at any
date, without duplication, (i) the consolidated current liabilities of Holdings
and its Consolidated Subsidiaries plus (ii) all Guaranty Obligations of
Holdings or any Consolidated Subsidiary of Holdings in respect of the current
liabilities of any Person (other than Holdings or a Consolidated Subsidiary of
Holdings), determined as of such date in accordance with GAAP.

“Consolidated EBITDA” means for any period the
sum of:

(i)            Consolidated Net Income for such
period (excluding therefrom (x) any extraordinary or non-recurring items of
gain or loss and (y) any gain or loss from discontinued operations); plus

(ii)           to the extent not otherwise included
in the determination of Consolidated Net Income for such period, all net cash
proceeds of business interruption insurance policies, if any, received during
such period; plus

(iii)          without duplication, those amounts
which, in the determination of Consolidated Net Income for such period, have
been deducted for (A) Consolidated Interest Expense, (B) the principal
component of Synthetic Lease Obligations paid or payable in cash under leases
accounted for as Operating Leases during such period but which constitute
Synthetic Leases hereunder, (C) Federal, state, local and foreign income tax,
franchise taxes and state single business unitary and similar taxes imposed in
lieu of income tax, (D) depreciation, amortization (including, without
limitation, amortization of goodwill and other intangible assets), impairment
of goodwill and other nonrecurring, non-cash charges or expenses (excluding any
such non-cash 

 9
 

 

charge or expense to the extent that it
represents amortization of a prepaid cash expense that was paid in a prior
period or an accrual of, or a reserve for, cash charges or expenses in any
future period), (E) non-cash compensation expense, or other non-cash expenses
or charges, arising from the issuance or sale of stock, the granting of stock
options, restricted stock units, stock appreciation rights or other similar
instruments (including any repricing, amendment, modification, substitution or
change of any such stock, stock option, restricted stock unit, stock
appreciation rights or similar instruments), (F) non-cash purchase accounting adjustments
in accordance with GAAP, (G) any financial advisory fees, accounting fees,
legal fees and other similar advisory and consulting fees and related
out-of-pocket expenses of the Borrower or any of its Affiliates incurred by
October 31, 2007 as a result of the Transaction, (H) Transaction related expenditures (including
cash charges in respect of strategic market reviews, management bonuses, early
retirement of Indebtedness, restructuring, consolidation, severance or
discontinuance of any portion of operations, employees and/or management) which
shall not in the aggregate exceed $15,000,000, (I) the amount of (x) any
expense to the extent that a corresponding amount is received in cash by a
Group Company from a Person other than Holdings or any Subsidiary of Holdings
under any agreement providing for reimbursement of such expense or (y) any
expenses with respect to liability or casualty events, business interruption or
product recalls, to the extent covered by insurance (it being understood that
if the amount received in cash under any such agreement in any period exceeds
the amount of expense paid during such period such excess amounts received may
be carried forward and applied against expenses in future periods), (J) any
financial advisory fees, accounting fees, legal fees and other similar advisory
and consulting fees and related out-of-pocket expenses of the Borrower and its
Consolidated Subsidiaries incurred as a result of Permitted Business
Acquisitions, a Qualifying Equity Issuance or a Public Debt Issuance and (K)
non-recurring cash charges resulting from severance, integration, restructuring
costs and other adjustments (x) incurred by October 31, 2007 as a result of the
Borrower’s acquisition of Lipman or (y) incurred as a result of Permitted Business
Acquisitions, provided that the amounts referred to in this clause
(K) reported in any fiscal period ending after October 31, 2006 shall not,
in the aggregate, exceed (1) $20,000,000 in the case of clause (K)(x)
and (2) 20% of the aggregate consideration paid in connection with Permitted
Business Acquisitions in the case of clause (K)(y); minus

(iv)          any amount which, in the determination
of Consolidated Net Income for such period, has been added for (A) interest
income and (B) any non-cash income or non-cash gains, all as determined in
accordance with GAAP;

provided that Consolidated EBITDA
for any fiscal period ending prior to the Closing Date which is identified on Schedule
1.01A hereto shall be deemed to equal the amount set forth on Schedule
1.01A opposite such period.  For
purposes of calculating Consolidated EBITDA for any period of four consecutive
fiscal quarters (each, a “Reference Period”) pursuant to any
determination of the Total Leverage Ratio, the Fixed Charge Coverage Ratio or
the Senior Leverage Ratio, if during such Reference Period (or in the case of
pro-forma calculations, during the period from the last day of such Reference
Period to and including the date as of which such calculation is made) any
Group Company shall have made an Asset Disposition or a Permitted Business
Acquisition, Consolidated EBITDA for such Reference Period shall be calculated
after giving effect thereto on a Pro-Forma Basis giving effect, without
duplication, to projected or anticipated cost savings and synergies permitted
or required by Regulations S-K or S-X under the Securities Act and to operating
expense reductions to the extent factually supportable and such reductions have
been realized or for which all steps necessary for realization have been taken
or are reasonably expected to be taken within twelve months, in each case as
certified by a Responsible Officer of the Borrower.

 10
 

 

“Consolidated Fixed Charges” means, for any
period, the sum of (i) Consolidated Cash Interest Expense plus (ii)
Consolidated Scheduled Debt Payments.

“Consolidated Funded Indebtedness” means at any
date the Funded Indebtedness of Holdings and its Consolidated Subsidiaries as
of such date, determined on a consolidated basis in accordance with GAAP.

“Consolidated Indebtedness” means at any date
the Indebtedness of Holdings and its Consolidated Subsidiaries, determined on a
consolidated basis as of such date.

“Consolidated Interest Expense” means, for any
period, the total interest expense, whether paid or accrued, (including,
without limitation, amortization of debt issuance costs and original issue
discount, interest capitalized during construction, non-cash interest payments,
the interest component of any deferred payment obligations, the interest
component of all payments under Capital Leases and the implied interest
component of Synthetic Leases (regardless of whether accounted for as interest
expense under GAAP), all commissions, discounts and other fees and charges owed
with respect to letters of credit and bankers’ acceptances and net costs in
respect of Swap Obligations constituting interest rate swaps, collars, caps or
other arrangements requiring payments contingent upon interest rates of
Holdings and its Consolidated Subsidiaries), net of interest income, in each
case determined on a consolidated basis for such period; provided that
any interest on Indebtedness of another Person that is guaranteed by Holdings
or any of its Consolidated Subsidiaries or secured by (or for which the holder
of such Indebtedness has an existing right, contingent or otherwise, to be
secured by) a Lien on, or payable out of the proceeds of the sale of or
production from, assets of Holdings or any of its Consolidated Subsidiaries
(whether or not such guarantee or Lien is called upon) shall be included (but for
purposes of calculating the Fixed Charge Coverage Ratio for any period only to
the extent paid by Holdings or any Consolidated Subsidiary).

“Consolidated Net Income” means, for any
period, the net income (or net loss) after taxes of Holdings and its Consolidated
Subsidiaries for such period, determined on a consolidated basis in accordance
with GAAP; provided that there shall be excluded from the calculation of
Consolidated Net Income for any period (i) the income (or loss) of any Person
in which any other Person (other than Holdings or any of its Wholly-Owned
Subsidiaries) has an ownership interest, except to the extent that any such
income is actually distributed in cash to Holdings or such Wholly-Owned
Subsidiary during such period, (ii) the income (or loss) of any Person accrued
prior to the date it becomes a Consolidated Subsidiary of Holdings or is merged
with or into or consolidated with Holdings or any of its Consolidated
Subsidiaries or that Person’s assets are acquired by Holdings or any of its Consolidated
Subsidiaries, except as provided in the definitions of “Consolidated EBITDA”
and “Pro-Forma Basis” herein and (iii) the income of any Subsidiary of
Holdings to the extent that the declaration or payment of Restricted Payments
or similar distributions by that Subsidiary of that income is not at the time
permitted by operation of the terms of its charter or any agreement,
instrument, judgment, decree, order, statute, rule or governmental regulation
applicable to that Subsidiary.

“Consolidated Scheduled Debt Payments” means,
for any period, the sum of all scheduled payments of principal on the Loans and
all other Consolidated Funded Indebtedness (including, without limitation, the
principal component of Capital Lease Obligations and Synthetic Lease
Obligations (regardless of whether accounted for as indebtedness under GAAP)
paid or payable during such period), but excluding payments due on Revolving
Loans and Swing Line Loans during such period; provided that
Consolidated Scheduled Debt Payments for any period shall not include voluntary
prepayments of Consolidated Funded Indebtedness, mandatory prepayments of the
Term B Loans pursuant to Section 2.09(b) or other mandatory prepayments
(other than by virtue of scheduled amortization) of Consolidated Funded
Indebtedness (but Consolidated Scheduled Debt Payments for a period shall be
adjusted to reflect 

 11
 

 

the effect on scheduled
payments of principal for such period of the application of any prepayments of
Consolidated Funded Indebtedness during or preceding such period).

“Consolidated Subsidiary” means with respect to
any Person at any date any Subsidiary of such Person or other entity the
accounts of which would be consolidated with those of such Person in its
consolidated financial statements if such statements were prepared as of such
date in accordance with GAAP.

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

“Control” means (i) the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of such Person, whether through the ownership of voting shares or
their equivalent, by contract or otherwise or (ii) with respect to any Person
having voting shares or their equivalent, the possession, directly or
indirectly, of the power to vote 15% or more of the Voting Securities of such
Person.

“Credit Extension” means a Borrowing or the
issuance, renewal, extension or increase of a Letter of Credit.

“Debt Equivalents” of any Person means (i) any
Equity Interest of such Person which by its terms (or by the terms of any
security for which it is convertible or for which it is exchangeable or
exercisable), or upon the happening of any event or otherwise (including an
event which would constitute a Change of Control), (A) matures or is
mandatorily redeemable or subject to any mandatory repurchase requirement,
pursuant to a sinking fund or otherwise, (B) is convertible into or
exchangeable for Indebtedness or Debt Equivalents or (C) is redeemable or
subject to any repurchase requirement arising at the option of the holder
thereof, in whole or in part, in each case on or prior to the date which is six
months after the later of the Revolving Termination Date and the Term B
Maturity Date and (ii) if such Person is a Subsidiary of the Borrower but not a
Loan Party, any Preferred Stock of such Person.

“Debt Issuance” means the issuance by any Group
Company of any Indebtedness.

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

“Default” means any condition or event which
constitutes an Event of Default or which with the giving of notice or lapse of
applicable grace periods or both would, unless cured or waived, become an Event
of Default.

“Defaulting Lender” means at any time any
Lender that, within one Business Day of when due, (i) has failed to make a Loan
or purchase a Participation Interest in a Swing Line Loan or an L/C Obligation
required pursuant to the terms of this Agreement, (ii) other than as set forth
in clause (i) above, has failed to pay to any Agent or any Lender an
amount owed by such Lender pursuant to the terms of the Agreement or any other
Loan Document unless such amount is subject to a good faith dispute or (iii)
has been deemed insolvent or has become subject to a receivership or insolvency
event.

“Default Rate” means, for any day and with
respect to any amount owing under any Loan Document, an interest rate equal to
the applicable rate specified in Section 2.06(e).

 12
 

 

“Depositary Bank Agreement” means an agreement
between a Loan Party and any bank or other depositary institution, substantially
in the form of, or containing terms substantially equivalent to those in, Exhibit
C to the Security Agreement, as the same may be amended, modified or
supplemented from time to time.

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

“Domestic Subsidiary” means with respect to any
Person each Subsidiary of such Person that is organized under the laws of the
United States or any political subdivision or any territory thereof, and “Domestic
Subsidiaries” means any two or more of them.

“DRC” means Duff & Phelps Credit Rating
Co., and its successors.

“Effective Date” means the date this Agreement
becomes effective in accordance with Section 10.21.

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

“Employee Benefit Arrangements” means in any
jurisdiction the material benefit schemes or arrangements in respect of any
employees or past employees operated by any Group Company or in which any Group
Company participates and which provide benefits on retirement, ill-health,
injury, death or voluntary withdrawal from or termination of employment,
including termination indemnity payments and life assurance and post-retirement
medical benefits, other than Plans and Foreign Pension Plans.

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

“Environmental Liability” means any liability,
contingent or otherwise (including any liability for damages, costs of
remediation, fines, penalties or indemnities), of any Group Company directly or
indirectly resulting from or based on (i) violation of any Environmental Law,
(ii) the generation, use, handling, transportation, storage, treatment or
disposal of any Hazardous Material, (iii) exposure to any Hazardous Material,
(iv) the release or threatened release of any Hazardous Material into the
environment or (v) any contract, agreement or other consensual arrangement
pursuant to which liability is assumed or imposed with respect to any of the
foregoing.

“Equity Equivalents” means with respect to any
Person any rights, warrants, options, convertible securities, exchangeable
securities, indebtedness or other rights, in each case exercisable for or
convertible or exchangeable into, directly or indirectly, Equity Interests of
such Person or securities exercisable for or convertible or exchangeable into
Equity Interests of such Person, whether at the time of issuance or upon the
passage of time or the occurrence of some future event.

“Equity Interests” means all shares of capital
stock, partnership interests (whether general or limited), limited liability
company membership interests, beneficial interests in a trust and any other
interest or participation that confers on a Person the right to receive a share
of profits or losses, or distributions of assets, of an issuing Person, but
excluding any debt securities convertible into such Equity Interests.

 13
 

 

“Equity Issuance” means (i) any sale or
issuance by any Group Company to any Person other than Holdings or a Subsidiary
of Holdings of any Equity Interests or any Equity Equivalents (other than any
such Equity Equivalents that constitute Indebtedness) and (ii) the receipt by
any Group Company of any cash capital contributions, whether or not paid in
connection with any issuance of Equity Interests of any Group Company, from any
Person other than Holdings or a Subsidiary of Holdings.

“ERISA” means the Employee Retirement Income
Security Act of 1974, as amended, and any rule or regulation issued thereunder.

“ERISA Affiliate” means each business or entity
which is under “common control” with a Group Company within the meaning of
Section 4001(a)(14) of ERISA or, for purposes of subsection (viii) of
the definition of “ERISA Event”, the definition of “Plan” and Section
6.08, each business or entity which is a member of a “controlled group of
corporations,” under “common control” or an “affiliated service group” with a
Group Company within the meaning of Section 414(b), (c) or (m) of the Code or
required to be aggregated with a Group Company under Section 414(o) of the
Code.

“ERISA Event” means:

(i)            a reportable event as defined in
Section 4043 of ERISA and the regulations issued under such Section with
respect to a Plan, excluding, however, such events as to which the PBGC by
regulation has waived the requirement of Section 4043(a) of ERISA that it be
notified within 30 days of the occurrence of such event;

(ii)           the requirements of Section 4043(b)
of ERISA apply with respect to a contributing sponsor, as defined in Section
4001(a)(13) of ERISA, of any Plan, and an event described in paragraph (9),
(10), (11), (12) or (13) of Section 4043(c) of ERISA is reasonably expected to
occur with respect to such Plan within the following 30 days;

(iii)          the failure to meet the minimum
funding standard of Section 412 of the Code with respect to any Plan (whether
or not waived in accordance with Section 412(d) of the Code), the application
for a minimum funding waiver under Section 303 of ERISA with respect to any
Plan, the failure to make by its due date a required installment under Section
412(m) of the Code with respect to any Plan or the failure to make any required
contribution to a Multiemployer Plan;

(iv)          (A) the incurrence of any material
liability by a Group Company pursuant to Title I of ERISA or to the penalty or
excise tax provisions of the Code relating to employee benefit plans (as
defined in Section 3 of ERISA), or the occurrence or existence of any event,
transaction or condition that could reasonably be expected to result in the
incurrence of any such material liability by a Group Company pursuant to Title
I of ERISA or to such penalty or excise tax provisions of the Code; or (B) the
incurrence of any material liability by a Group Company or an ERISA Affiliate
pursuant to Title IV of ERISA or the occurrence or existence of any event,
transaction or condition that could reasonably be expected to result in the
incurrence of any such material liability or imposition of any lien on any of
the rights, properties or assets of a Group Company or any ERISA Affiliate
pursuant to Title IV of ERISA or to Section 401(a)(29) or 412 of the Code;

(v)           the provision by the administrator of
any Plan of a notice pursuant to Section 4041(a)(2) of ERISA (or the reasonable
expectation of such provision of notice) of intent to terminate such Plan in a
distress termination described in Section 4041(c) of ERISA, the institution by
the PBGC of proceedings to terminate any Plan or the occurrence of any event or

 14
 

 

condition which might constitute grounds
under ERISA for the termination of a Plan by the PBGC, or the appointment of a
trustee by the PBGC to administer any Plan;

(vi)          the withdrawal of a Group Company or
ERISA Affiliate in a complete or partial withdrawal (within the meaning of
Section 4203 and 4205 of ERISA) from any Multiemployer Plan if there is any
potential material liability therefor, or the receipt by a Group Company or
ERISA Affiliate of notice from any Multiemployer Plan that it is in reorganization
or insolvency pursuant to Section 4241 or 4245 of ERISA, or that it intends to
terminate or has terminated under Section 4041A or 4042 of ERISA;

(vii)         the imposition of material liability
(or the reasonable expectation thereof) on a Group Company or ERISA Affiliate
pursuant to Section 4062, 4063, 4064 or 4069 of ERISA or by reason of the
application of Section 4212(c) of ERISA;

(viii)        the assertion of a material claim (other
than routine claims for benefits) against any Plan other than a Multiemployer
Plan or the assets thereof, or against a Group Company or ERISA Affiliate in
connection with any Plan;

(ix)           the receipt from the United States
Internal Revenue Service of notice of the failure of any Plan (or any Employee
Benefit Arrangement intended to be qualified under Section 401(a) of the Code)
to qualify under Section 401(a) of the Code, or the failure of any trust
forming part of any Plan to qualify for exemption from taxation under Section
501(a) of the Code, and, with respect to Multiemployer Plans, notice thereof to
any Group Company; and

(x)            the establishment or amendment by a
Group Company of any Welfare Plan that provides post-employment welfare
benefits in a manner that would reasonably be expected to result in a Material
Adverse Effect.

“Eurodollar Loan” means at any date a Loan
which bears interest at a rate based on the Eurodollar Rate.

“Eurodollar Rate” means for any Interest Period
with respect to any Eurodollar Loan:

(i)            the rate per annum equal to the rate
determined by the Administrative Agent to be the offered rate that appears on
the page of the Telerate screen (or any successor thereto) that displays an
average British Bankers Association Interest Settlement Rate for deposits in
Dollars (for delivery on the first day of such Interest Period) with a term
equivalent to such Interest Period, determined as of approximately 11:00 A.M.
(London time) two Business Days prior to the first day of such Interest Period;
or

(ii)           if the rate referred to in clause
(i) above does not appear on such page or service or such page or service
shall not be available, the rate per annum equal to the rate determined by the
Administrative Agent to be the offered rate on such other page or other service
that displays an average British Bankers Association Interest Settlement Rate
for deposits in Dollars (for delivery on the first day of such Interest Period)
with a term equivalent to such Interest Period, determined as of approximately
11:00 A.M. two Business Days prior to the first day of such Interest Period; or

(iii)          if the rates referenced in the
preceding clauses (i) and (ii) are not available, the rate per
annum determined by the Administrative Agent as the rate of interest (rounded
upwards to the next 1/16th of
1%) at which deposits in Dollars for delivery on the first 

 15
 

 

day of such Interest Period in same day funds
in the approximate amount of the Eurodollar Loan being made, continued or
converted by JPMCB and with a term equivalent to such Interest Period as would
be offered by JPMCB’s London branch to major banks in the London interbank
eurodollar market at their request at approximately 4:00 P.M. (London time) two
Business Days prior to the first day of such Interest Period.

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

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

“Excess Cash Flow” means for any period an
amount equal to:

(i)            Consolidated EBITDA
for such period; plus

(ii)           all cash
extraordinary or non-recurring gains and cash gains from discontinued
operations, if any, during such period (whether or not accrued in such period)
and (without duplication) cash gains attributable to Asset Dispositions out of
the ordinary course of business, if any, of Holdings and its Consolidated
Subsidiaries during such period in each case to the extent not otherwise
included in Consolidated EBITDA for such period and not required to be utilized
in connection with a repayment or prepayment of the Loans made or to be made
pursuant to Section 2.09(b)(iii); plus

(iii)          (x) the decrease,
if any, in Consolidated Adjusted Working Capital less (y) the decrease, if any,
in the principal amount of Revolving Loans and Swing Line Loans, in each case
from the first day to the last day of such period; minus

(iv)          the amount, if any,
which, in the determination of Consolidated EBITDA for such period, has been
included in respect of income or cash gains from Asset Dispositions of Holdings
and its Consolidated Subsidiaries to the extent utilized to repay or prepay
Loans pursuant to Section 2.09(b)(iii); minus

(v)           the aggregate amount
(without duplication and in each case except to the extent paid, directly or
indirectly, with proceeds of any Equity Issuance or Debt Issuance (other than
Revolving Loans) or with any amount referred to in clause (iii)(I) of
the definition of “Consolidated EBITDA” by any Group Company) of (A) the sum of
(x) cash payments during such period in respect of Consolidated Capital
Expenditures allowed under Section 7.14 plus (y) to the extent amounts
permitted to be paid during such period in respect of Consolidated Capital
Expenditures are carried forward to the next succeeding period in accordance
with Section 7.14(b), the aggregate amounts of all cash payments (not to
exceed such permitted carryforward amount) in respect of such Consolidated
Capital Expenditures made during such next succeeding period pursuant to
commitments entered into during such period or prior to the date the Excess
Cash Flow certificate is required to be delivered for such period pursuant to Section
6.02(f) (it being understood and agreed that any cash payments in respect
of Consolidated Capital 

 16
 

 

Expenditures
deducted from Excess Cash Flow pursuant to this clause (v)(A)(y) shall
not thereafter be deducted pursuant to clause (v)(A)(x) above in the
determination of Excess Cash Flow for the period during which such payments
were actually paid), (B) cash payments during such period in respect of (x)
Permitted Joint Ventures allowed under Section 7.06(a)(xii) and (y)
Permitted Business Acquisitions, (C) optional prepayments of the Indebtedness
(other than Subordinated Indebtedness) provided that (x) such
prepayments are otherwise permitted hereunder and (y) if such Indebtedness
consists of a revolving line of credit, the commitments under such line of
credit are permanently reduced by the amount of such prepayment during such
period, (D) to the extent not included in clause (iv) above, repayments
or prepayments of the Revolving Loans and Swing Line Loans to the extent the
Revolving Commitments and the Swing Line Commitment are permanently reduced at
the time of such payment, (E) Consolidated Scheduled Debt Payments actually
paid by Holdings and its Consolidated Subsidiaries during such period, (F)
Consolidated Cash Interest Expense actually paid by Holdings and its
Consolidated Subsidiaries during such period, (G) Consolidated Cash Taxes for
such period (exclusive of any taxes referred to in clause (viii) below
and deducted in respect of the determination of Excess Cash Flow for a prior
period), (H) the aggregate amount of all Restricted Payments allowed under Section
7.07(iii), (iv) and (v) actually paid in cash during such period or
committed on or prior to the date the Compliance Certificate for such period is
delivered pursuant to Section 6.02(b) to be paid in cash with respect to
such period, (I) the aggregate amount of all financial advisory fees,
accounting fees, legal fees and other similar advisory and consulting fees and
related out-of-pocket expenses incurred as a result of the Transaction, any
Permitted Business Acquisition or Permitted Joint Venture, a Qualifying Equity
Issuance or a Public Debt Issuance and actually paid in cash by Holdings and
its Consolidated Subsidiaries during such period, in each case to the extent
reflected in Consolidated Net Income and in the determination of Consolidated
EBITDA for such period, (J) Transaction related expenditures (including cash
charges in respect of strategic market reviews, management bonuses, early
retirement of Indebtedness, restructuring, consolidation, severance or
discontinuance of any portion of operations, employees and/or management) which
shall not in the aggregate exceed $15,000,000 and which are actually paid in
cash by Holdings and its Consolidated Subsidiaries during such period, in each
case to the extent reflected in Consolidated Net Income and in the
determination of Consolidated EBITDA for such period, and (K) to the extent
reflected in Consolidated Net Income and in the determination of Consolidated
EBITDA for such period, earn-out obligations incurred in connection with Permitted
Business Acquisitions; minus

(vi)          all cash
extraordinary or non-recurring losses and losses from discontinued operations,
if any, during such period (whether or not accrued in such period); minus

(vii)         (x) the increase, if
any, in Consolidated Adjusted Working Capital less (y) the increase, if any, in
the principal amount of Revolving Loans and Swing Line Loans, in each case from
the first day to the last day of such period; minus

(viii)        an amount equal to
the income and withholding taxes (as estimated in good faith by a senior
financial or senior accounting officer of the Borrower giving effect to the
overall tax position of Parent Holdings and its Subsidiaries) payable in the
period following the period for which Excess Cash Flow is determined in respect
of that amount of Excess Cash Flow as is attributable to the actual
repatriation to the Borrower of undistributed earnings of those Subsidiaries of
the Borrower that are “controlled foreign corporations” under Section 957 of
the Code to enable it to prepay the Loans and or Cash Collateralize L/C
Obligations as required under Section 2.09(b)(ii) in respect of Excess
Cash Flow for such period.

 17

 

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

“Excluded
Asset Disposition” means an Asset Disposition permitted pursuant to any one
or more of clauses (i) through (xvi) of Section 7.05.

“Existing
Credit Agreement” means the Credit
Agreement dated as of June 30, 2004, as amended as of March 23, 2005 and
September 7, 2005, among the Borrower, Holdings, the Lenders (as defined
therein) from time to time party thereto, Bank of America, N.A., as
Administrative Agent, Senior Collateral Agent, Second Lien Collateral Agent,
L/C Issuer and Swing Line Lender, Credit Suisse First Boston, Cayman Islands
Branch, as Syndication Agent, and Wells Fargo Bank, N.A., as Documentation
Agent.

“Existing
Indebtedness” has the meaning specified in Section 7.01(i).

“Facilities
Increase” has the meaning specified in Section 2.10(a).

“Facilities
Increase Date(s)” has the meaning specified in Section 2.10(a).

“Failed
Loan” has the meaning specified in Section 2.03(e).

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

“Finance
Document” means (i) each Loan Document, (ii) each Swap Agreement between
one or more Loan Parties and a Swap Creditor evidencing Swap Obligations
permitted hereunder and (iii) each Cash Management Agreement, and “Finance
Documents” means all of them, collectively.

“Finance
Obligations” means, at any date, (i) all Senior Credit Obligations, (ii)
all Swap Obligations of a Loan Party permitted hereunder owed or owing to any
Swap Creditor and (iii) all Cash Management Obligations owing to a Cash
Management Bank.

“Finance
Party” means each Senior Credit Party, each Swap Creditor and each Cash
Management Bank and their respective successors and assigns, and “Finance
Parties” means any two or more of them, collectively.

“First
Priority Liens” means, valid and perfected first priority security
interests in favor of the Collateral Agent for the benefit of the Finance
Parties and securing the Finance Obligations.

“Fitch”
means Fitch IBCA, Inc., and its successors.

“Fixed
Charge Coverage Ratio” means, for any period, the ratio of (i) Consolidated
EBITDA less the aggregate amount of Consolidated Capital Expenditures for such
period (exclusive, 

 18
 

 

without duplication, of (x) the portion thereof
financed with (A) any Debt Issuance, (B) any Qualifying Equity Issuance and
(C) the Net Cash Proceeds of Asset Dispositions or from Casualties or
Condemnations received during such period that are not required to be applied
to repay Loans or cash collateralize L/C Obligations pursuant to Section
2.09(b)(iii) and (y) Consolidated Capital Expenditures referred to in Section
7.14(d)) less Consolidated Cash Taxes to (ii) Consolidated Fixed Charges
for such period.

“Foreign Cash Equivalents” means:

(i)            securities issued or fully
guaranteed by the United Kingdom or any instrumentality thereof (as long as
that the full faith and credit of the United Kingdom is pledged in support of
those securities);

(ii)           certificates of deposit, eurodollar
time deposits, overnight bank deposits and bankers’ acceptances of any foreign
bank, or its branches or agencies (fully protected against currency
fluctuations) that, at the time of acquisition, are rated at least “A-I” by
S&P or “P-I” by Moody’s, and (ii) certificates of deposit, eurodollar time
deposits, banker’s acceptances and overnight bank deposits, in each case of any
non-U.S. commercial bank having capital and surplus in excess of $500,000,000
and a Thomson BankWatch Rating of at least “B”;

(iii)          repurchase obligations with a term of
not more than seven days with respect to securities or other instruments of the
types described in clause (i) or (ii) with a bank or trust
company (including any of the Lenders) or recognized securities dealer having
capital and surplus in excess of $500,000,000 in which the Borrower or one or
more of its Subsidiaries shall have a perfected first priority security
interest (subject to no other Liens) and having, on the date of purchase
thereof, a fair market value of at least 100% of the amount of the repurchase
obligations; and

(iv)          investments, classified in accordance
with GAAP as current assets, in shares of any money market fund that has at
least 95% of its assets invested continuously in the types of investments
referred to in clauses (i) through (iii) above which are
administered by reputable financial institutions having capital of at least
$500,000,000; provided, however, that the maturities of all obligations
of the type specified in clauses (i) through (iii) above shall
not exceed the lesser of the time specified in such clauses.

“Foreign
Lender” has the meaning specified in Section 10.15(a)(i).

“Foreign
Pension Plan” means any material plan, fund (including, without limitation,
any superannuation fund) or other similar program established or maintained
outside the United States by any Group Company primarily for the benefit of
employees of any Group Company residing outside the United States, which plan,
fund or other similar program provides, or results in, retirement income, a
deferral of income in contemplation of retirement or payments to be made upon
termination of employment, and which plan is not subject to ERISA or the Code.

“Foreign
Subsidiary” means with respect to any Person any Subsidiary of such Person
that is not a Domestic Subsidiary of such Person.

“Funded
Indebtedness” means, with respect to any Person and without duplication,
(i) all Indebtedness of such Person of the types referred to in clauses (i),
(ii), (iii), (iv), (v), (vi), and (vii)
of the definition of “Indebtedness” in this Section 1.01, (ii) all
Indebtedness of others of the type referred to in clause (i) above
secured by (or for which the holder of such Indebtedness has an existing right,
contingent 

 19
 

 

 

or otherwise, to be secured by) a Lien on, or payable
out of the proceeds of production from, any property or asset of such Person,
whether or not the obligations secured thereby have been assumed by such
Person, (iii) all Guaranty Obligations of such Person with respect to
Indebtedness of others of the type referred to in clause (i) above and
(iv) all Indebtedness of the type referred to in clause (i) above of any
other Person (including any Partnership in which such Person is a general
partner and any unincorporated joint venture in which such Person is a joint
venturer) to the extent such Person would be liable therefor under any
applicable law or any agreement or instrument by virtue of such Person’s
ownership interest in or other relationship with such entity, except to the
extent the terms of such Indebtedness provide that such Person shall not be
liable therefor.

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

“Government
Acts” has the meaning specified in Section 2.05(m)(i).

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

“Group
Company” means any of Holdings, the Borrower or their respective
Subsidiaries (regardless of whether or not consolidated with Holdings or the
Borrower for purposes of GAAP), and “Group Companies” means all of them,
collectively.

“Group”
means at any time a group of Loans consisting of (i) all Loans which are Base
Rate Loans at such time or (ii) all Loans which are Eurodollar Loans having the
same Interest Period at such time; provided that, if a Loan of any
particular Lender is converted to or made as a Base Rate Loan pursuant to Article
III, such Loan shall be included in the same Group or Group of Loans from
time to time as it would have been had it not been so converted or made.

“Guaranty”
means the Guaranty, substantially in the form of Exhibit F hereto, by
Parent Holdings, Holdings and the Subsidiary Guarantors in favor of the
Administrative Agent, as the same may be amended, modified or supplemented from
time to time.

“Guaranty
Obligation” means, with respect to any Person, without duplication, any
obligation (other than endorsements in the ordinary course of business of
negotiable instruments for deposit or collection) guarantying, intended to
guaranty, or having the economic effect of guarantying, any Indebtedness of any
other Person in any manner, whether direct or indirect, and including, without
limitation, any obligation, whether or not contingent, (i) to purchase any such
Indebtedness or any property constituting security therefor, (ii) to advance or
provide funds or other support for the payment or purchase of such Indebtedness
or obligation or to maintain working capital, solvency or other balance sheet
condition of such other Person (including, without limitation, maintenance
agreements, support agreements, comfort letters, take or pay arrangements, put
agreements or similar agreements or arrangements) for the benefit of the holder
of Indebtedness of such other Person, (iii) to lease or purchase property,
securities or services primarily for the purpose of assuring the owner of such
Indebtedness or (iv) to otherwise assure or hold harmless the owner of such
Indebtedness against loss in respect thereof. 
The amount of any Guaranty Obligation hereunder shall (subject to any
limitations set forth therein) be 

 20
 

 

deemed to be an amount equal to the outstanding
principal amount (or maximum principal amount, if larger) of the Indebtedness
in respect of which such Guaranty Obligation is made.

“Hazardous
Materials” means all explosive or radioactive substances or wastes and all
hazardous or toxic substances, wastes or other pollutants or environmental
contaminants, including petroleum or petroleum distillates, asbestos or
asbestos-containing materials, polychlorinated biphenyls, radon gas and all other
substances or wastes regulated pursuant to any Environment Law because of their
hazardous or deleterious properties.

“Holdings”
means VeriFone Intermediate Holdings, Inc., a Delaware corporation, and its
successors.

“Honor
Date” has the meaning specified in Section 2.05(e).

“Indebtedness”
means, as to any Person at a particular time, without duplication, all of the
following, whether or not included as indebtedness or liabilities in accordance
with GAAP: (i) all obligations of such Person for borrowed money, (ii) all
obligations of such Person evidenced by bonds, debentures, notes or other
similar instruments, (iii) all obligations of such Person under conditional
sale or other title retention agreements relating to property purchased by such
Person to the extent of the value of such property (other than customary
reservations or retentions of title under agreements with suppliers entered
into in the ordinary course of business), (iv) all obligations, other than
intercompany items, of such Person to pay the deferred purchase price of
property or services (other than trade accounts payable and accrued expenses
arising in the ordinary course of business and due within six months of the
incurrence thereof), (v) the Attributable Indebtedness of such Person in respect
of Capital Lease Obligations and Synthetic Lease Obligations (regardless of
whether accounted for as indebtedness under GAAP), (vi) all obligations of such
Person to purchase securities or other property which arise out of or in
connection with the sale of the same or substantially similar securities or
property, (vii) all obligations, contingent or otherwise, of such Person to
reimburse any bank or other Person in respect of amounts paid under a letter of
credit, bankers’ acceptance or similar instrument, (viii) all Indebtedness of
others secured by (or for which the holder of such obligations has an existing
right, contingent or otherwise, to be secured by) a Lien on, or payable out of
the proceeds of production from, any property or asset of such Person, whether
or not such obligation is assumed by such Person; provided that the
amount of any Indebtedness of others that constitutes Indebtedness of such
Person solely by reason of this clause (viii) shall not for purposes of
this Agreement exceed the greater of the book value or the fair market value of
the properties or assets subject to such Lien, (ix) all Guaranty Obligations of
such Person, (x) all Debt Equivalents of such Person and (xii) the Indebtedness
of any other Person (including any partnership in which such Person is a
general partner and any unincorporated joint venture in which such Person is a
joint venturer) to the extent such Person would be liable therefor under
applicable Law or any agreement or instrument by virtue of such Person’s ownership
interest in or other relationship with such entity, except to the extent the
terms of such Indebtedness provide that such person shall not be liable
therefor; provided that (i) Indebtedness shall not include (A) deferred
compensation arrangements, (B) earn-out obligations until matured or earned
(whether or not represented by a note or other instrument) or (C) non-compete
or consulting obligations incurred in connection with Permitted Business
Acquisitions and (ii) the amount of any Limited Recourse Indebtedness of any
Person shall be equal to the lesser of (A) the aggregate principal amount of
such Limited Recourse Indebtedness for which such Person provides credit
support of any kind (including any undertaking agreement or instrument that
would constitute Indebtedness), is directly or indirectly liable as a guarantor
or otherwise or is the lender and (B) the fair market value of any assets
securing such Indebtedness or to which such Indebtedness is otherwise recourse.

“Indemnified
Liabilities” has the meaning specified in Section 10.05.

 21
 

 

“Indemnitees”
has the meaning specified in Section 10.05.

“Insurance
Proceeds” means all cash insurance proceeds (other than business
interruption insurance proceeds) with respect to any Casualty.

“Intellectual
Property” has the meaning set forth in the Security Agreement.

“Intercompany
Note” means a promissory note contemplated by Section 7.06(a)(x) or (xi),
substantially in the form of Exhibit H hereto, and “Intercompany
Notes” means any two or more of them.

“Interest
Payment Date” means (i) as to Base Rate Loans, the last Business Day of
each fiscal quarter of the Borrower and the Maturity Date for Loans of the
applicable Class and (ii) as to Eurodollar Loans, the last day of each
applicable Interest Period and the Maturity Date for Loans of the applicable
Class, and in addition where the applicable Interest Period for a Eurodollar
Loan is greater than three months, then also the respective dates that fall
every three months after the beginning of such Interest Period.

“Interest
Period” means with respect to each Eurodollar Loan, a period commencing on
the date of borrowing specified in the applicable Notice of Borrowing or on the
date specified in the applicable Notice of Extension/Conversion and ending (i)
one, two, three, six (or if deposits of such duration are available to all of
the Lenders having Commitments or Loans of the applicable Class, nine or
twelve) months thereafter or (ii) in the case of a Eurodollar Loan borrowed or
converted prior to the Syndication Date, on a date which is less than one month
thereafter as may be agreed to by all of the Lenders having Commitments or
Loans of the applicable Class, as the Borrower may elect in the applicable
notice; provided that:

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

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

(iii)          no Interest Period in respect of Term
Loans may be selected which extends beyond a Principal Amortization Payment
Date for Loans of the applicable Class unless, after giving effect to the selection
of such Interest Period, the aggregate principal amount of Term Loans of the
applicable Class which are comprised of Base Rate Loans together with such Term
Loans comprised of Eurodollar Loans with Interest Periods expiring on or prior
to such Principal Amortization Payment Date are at least equal to the aggregate
principal amount of Term Loans of the applicable Class due on such date;

(iv)          if so provided in written notice to
the Borrower by the Administrative Agent at the direction of the Required
Lenders, no Interest Period may be selected at any time when a Default or an
Event of Default is then in existence; and

(v)           no Interest Period may be selected
which would end after the Maturity Date for Loans of the applicable Class.

 22
 

 

 

“Investment”
in any Person means (i) the acquisition (whether for cash, property, services,
assumption of Indebtedness, securities or otherwise) of assets (other than
inventory, machinery, equipment and other assets in the ordinary course of
business), Equity Interests, Equity Equivalents, Debt Equivalents, Indebtedness
or other securities of such Person, (ii) any deposit with, or advance, loan or
other extension of credit to or for the benefit of such Person (other than
deposits made in connection with the purchase of equipment, inventory or
services in the ordinary course of business) or (iii) any other capital
contribution to or investment in such Person, including by way of Guaranty
Obligations of any obligation of such Person, any support for a letter of
credit issued on behalf of such Person incurred for the benefit of such Person
or in the case of any Subsidiary of the Borrower, any release, cancellation,
compromise or forgiveness in whole or in part of any Indebtedness owing by such
Person.  The amount of any Investment at
any time shall be deemed to equal the difference of (i) the aggregate
initial amount of such Investment less (ii) all returns of principal
thereof or capital with respect thereto prior to such time and all liabilities
expressly assumed by another Person (and with respect to which Holdings and its
Subsidiaries, as applicable, shall have received a novation) in connection with
the sale of such Investment.

“ISP”
means, with respect to any Letter of Credit, the “International Standby
Practices 1998” published by the Institute of International Banking Law &
Practice (or such later version thereof as may be in effect at the time of
issuance).

“JPMCB”
means JPMorgan Chase Bank, N.A.

“Joint
Lead Arrangers” means J.P. Morgan Securities Inc. and Lehman Brothers Inc.

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

“LCPI”
means Lehman Commercial Paper Inc.

“L/C
Borrowing” means a Revolving Borrowing made pursuant to Section
2.05(e)(iv) and (v) to refinance Unreimbursed Amounts in respect of
drawn Letters of Credit.

“L/C
Cash Collateral Account” has the meaning specified in the Security
Agreement.

“L/C
Commitment” means the commitment of one or more L/C Issuers to issue
Letters of Credit in an aggregate face amount at any one time outstanding
(together with the amounts of any unreimbursed drawings thereon) of up to the
L/C Sublimit.

“L/C
Disbursement” means a payment or disbursement made by an L/C Issuer
pursuant to a Letter of Credit.

“L/C
Documents” means, with respect to any Letter of Credit, such Letter of
Credit, any amendments thereto, any other documents delivered in connection
therewith, any application therefor and any agreements, instruments, Guaranties
or other documents (whether general in application to Letters of Credit
generally or applicable only to such Letter of Credit) governing or providing
for (i) the rights and obligations of the parties concerned or at risk or (ii)
any collateral security for such obligations.

 23
 

 

“L/C
Issuer” means (i) JPMCB in its capacity as issuer of Letters of Credit under
Section 2.05(a), and its permitted successor or successors in such
capacity and (ii) any other Lender which the Borrower shall have designated as
an “L/C Issuer” by notice to the Administrative Agent.

“L/C
Obligations” means at any time, the sum of (i) the maximum amount which is,
or at any time thereafter may become, available to be drawn under Letters of
Credit then outstanding, assuming compliance with all requirements for drawings
referred to in such Letters of Credit plus (ii) the aggregate amount of all L/C
Disbursements not yet reimbursed by the Borrower as provided in Section
2.05(e)(ii), (iii), (iv) or (v) to the applicable L/C Issuers in respect of
drawings under Letters of Credit, including any portion of any such obligation
to which a Lender has become subrogated pursuant to Section 2.05(e)(vi).  For all purposes of this Agreement and all
other Loan Documents, if on any date of determination a Letter of Credit has
expired by its terms but any amount may still be drawn thereunder by reason of
the operation of Rule 3.14 of the ISP, such Letter of Credit shall be deemed to
be “outstanding” in the amount so remaining available to be drawn.

“L/C
Sublimit” means an amount equal to $20,000,000.  The L/C Sublimit is a part of, and not in
addition to, the Revolving Committed Amount.

“Leaseholds”
means with respect to any Person all of the right, title and interest of such
Person as lessee or licensee in, to and under leases or licenses of land,
improvements and/or fixtures.

“Lender”
means each bank or other lending institution identified on Schedule 2.01
as having a Revolving Commitment or a Swing Line Commitment, each bank or other
lending institution having a Term B Commitment and each Eligible Assignee which
acquires a Revolving Loan or a Term B Loan pursuant to Section 10.07(b)
and their respective successors.

“Letter
of Credit” means any letter of credit issued hereunder by a L/C Issuer on
or after the Closing Date.

“Letter
of Credit Expiration Date” means the day that is seven days prior to the
Revolving Termination Date then in effect (or, if such day is not a Business
Day, the next preceding Business Day).

“Letter
of Credit Request” has the meaning specified in Section 2.05(b).

“Lien”
means, with respect to any asset, any mortgage, pledge, hypothecation,
assignment, deposit arrangement, lien (statutory or other) or other security
interest or preferential arrangement in the nature of a security interest of
any kind or nature whatsoever (including any conditional sale or other title
retention agreement, any financing lease having substantially the same economic
effect as any of the foregoing, and the filing of any financing statement under
the Uniform Commercial Code or comparable Laws of any jurisdiction).  Solely for the avoidance of doubt, the filing
of a Uniform Commercial Code financing statement that is a protective lease
filing in respect of an Operating Lease that does not constitute a security
interest in the leased property or otherwise give rise to a Lien does not
constitute a Lien solely on account of being filed in a public office.

“Limited
Recourse Indebtedness” means, with respect to any Person, Indebtedness to
the extent:  (i) such Person (A) provides
no credit support of any kind (including any undertaking, agreement or
instrument that would constitute Indebtedness), (B) is not directly or
indirectly liable as a guarantor or otherwise or (C) does not constitute the
lender; and (ii) no default with respect thereto would permit upon notice,
lapse of time or both any holder of any other Indebtedness (other than the
Loans or the Notes) of 

 24
 

 

such Person to declare a default on such other
Indebtedness or cause the payment thereof to be accelerated or payable prior to
its stated maturity.

“Lipman”
means Lipman Electronic Engineering Ltd., an Israeli corporation, and its
successors and permitted assigns.

“Loan”
means a Revolving Loan, a Term B Loan or a Swing Line Loan (or a portion of any
Revolving Loans, Term B Loans or Swing Line Loans), individually or
collectively as appropriate; provided that, if any such loan or loans
(or portions thereof) are combined or subdivided pursuant to a Notice of
Extension/Conversion, the term “Loan” shall refer to the combined
principal amount resulting from such combination or to each of the separate
principal amounts resulting from such subdivision, as the case may be.

“Loan
Documents” means, collectively, this Agreement, the Notes, the Guaranty,
the Collateral Documents, each Perfection Certificate, the Intercompany Notes,
each Accession Agreement and each L/C Document, in each case as the same may be
amended, modified or supplemented from time to time, and all other related
agreements, certificates and documents executed by a Loan Party and delivered
to any Senior Credit Party in connection with or pursuant to any of the
foregoing.

“Loan
Party” means each of Parent Holdings, Holdings, the Borrower and each
Subsidiary Guarantor, and “Loan Parties” means any combination of the
foregoing.

“Margin
Stock” means “margin stock” as such term is defined in Regulation U.

“Material
Adverse Effect” means (i) any material adverse effect upon the business,
assets, liabilities (actual or contingent), operations, properties or condition
(financial or otherwise) of Holdings and its Subsidiaries taken as a whole,
(ii) a material impairment of the ability of any Loan Party to perform any of
its obligations under any Loan Document to which it is a party, which
materially impairs the ability of the Loan Parties to perform their obligations
under the Loan Documents, taken as a whole, (iii) a material impairment of the
rights and remedies of the Lenders under any Loan Document, which materially
impairs the rights or benefits of the Lenders under the Loan Documents, taken
as a whole.

“Maturity
Date” means (i) as to Revolving Loans and Swing Line Loans, the Revolving
Termination Date and (ii) as to Term B Loans, the Term B Maturity Date.

“Merger”
means the merger of Merger Sub with and into Lipman pursuant to, and in
accordance with, the terms of the Merger Agreement, with Lipman as the surviving
entity of such merger.

“Merger
Agreement” means the Agreement and Plan of Merger dated as of April 10,
2006 among Parent Holdings, Merger Sub and Lipman, and including the Lipman
Disclosure Letter referred to therein and all schedules and exhibits thereto.

“Merger
Documents” means the Merger Agreement and the other agreements, instruments
and documents relating thereto.

“Merger
Sub” means Lion Acquisitions Ltd., an Israeli corporation and a direct
Wholly-Owned Subsidiary of the Borrower.

 

 25

 

“Moody’s” means Moody’s Investors Service,
Inc., a Delaware corporation, and its successors or, absent any such successor,
such nationally recognized statistical rating organization as the Borrower and
the Administrative Agent may select.

“Multiemployer Plan” means a “multiemployer
plan” as defined in Section 3(37) or 4001(a)(3) of ERISA.

“Net Cash Proceeds”
means (without duplication):

(i)            with respect to any Asset
Disposition (other than an Asset Disposition consisting of a lease where one or
more Group Companies is acting as lessor entered into in the ordinary course of
business), Casualty or Condemnation, (A) the gross amount of all cash proceeds
(including cash Insurance Proceeds and cash Condemnation Awards in the case of
any Casualty or Condemnation, except to the extent and for so long as such
Insurance Proceeds or Condemnation Awards constitute Reinvestment Funds)
actually received by any Group Company in respect of such Asset Disposition,
Casualty or Condemnation (including any cash proceeds received as income or
other proceeds of any noncash proceeds of any Asset Disposition, Casualty or
Condemnation as and when received), less (B) the sum of (1) the amount, if any,
of all taxes (other than income taxes) and all income taxes (as estimated in
good faith by a senior financial or senior accounting officer of the Borrower
giving effect to the overall tax position of Parent Holdings and its
Subsidiaries), and customary fees, legal fees, brokerage fees, commissions,
costs and other expenses (other than those payable to any Group Company or to
Affiliates of any Group Company except for those payable on terms and
conditions as favorable to the applicable Group Company as would be obtainable
by it in a comparable arms’-length transaction with an independent, unrelated
third party) that are incurred in connection with such Asset Disposition,
Casualty or Condemnation and are payable by any Group Company, but only to the
extent not already deducted in arriving at the amount referred to in clause
(i)(A) above, (2) appropriate amounts set aside as a reserve in good faith
against any indemnities, liabilities (contingent or otherwise) associated with
such Asset Disposition, Casualty or Condemnation, (3) if applicable, the amount
of any Indebtedness secured by a Permitted Lien that has been repaid or
refinanced in accordance with its terms with the proceeds of such Asset
Disposition, Casualty or Condemnation; and (4) any payments to be made by any
Group Company as agreed between such Group Company and the purchaser of any
assets subject to an Asset Disposition, Casualty or Condemnation in connection
therewith; and

(ii)           with respect to any Debt Issuance,
the gross amount of cash proceeds paid to or received by any Group Company in
respect of such Debt Issuance as the case may be (including cash proceeds
subsequently as and when received at any time in respect of such Debt Issuance
from non-cash consideration initially received or otherwise), net of
underwriting discounts and commissions or placement fees, investment banking
fees, legal fees, consulting fees, accounting fees and other customary fees and
expenses directly incurred by any Group Company in connection therewith (other
than those payable to any Group Company or any Affiliate of any Group Company
except for those payable on terms and conditions as favorable to the applicable
Group Company as would be obtainable by it in a comparable arms’-length
transaction with an independent, unrelated third party).

“Note” means a Revolving Note, a Term B Note or
a Swing Line Note, and “Notes” means any combination of the foregoing.

“Notice of Borrowing” means a request by the
Borrower for a Borrowing, substantially in the form of Exhibit A-1
hereto.

 26
 

 

“Notice of Extension/Conversion” has the
meaning specified in Section 2.07.

“Operating Lease” means, as applied to any
Person, a lease (including leases which may be terminated by the lessee at any
time) of any property (whether real, personal or mixed) by such Person as
lessee which is not a Capital Lease.

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

“Other Taxes” has the meaning specified in Section
3.01.

“Outstanding Amount” means (i) with respect to
Term B Loans, Revolving Loans or Swing Line Loans on any date, the aggregate
outstanding principal amount thereof after giving effect to any borrowings and
prepayments or repayments of Term B Loans, Revolving Credit Loans and Swing
Line Loans, as the case may be, occurring on such date, and (ii) with respect
to any L/C Obligations on any date, the amount of such L/C Obligations on such
date after giving effect to any L/C Credit Extension occurring on such date and
any other changes in the aggregate amount of the L/C Obligations as of such
date, including as a result of any reimbursements by the Borrower of L/C
Disbursements.

“paid in full” and “payment in full”
means, with respect to any Finance Obligation, the occurrence of all of the
foregoing:  (i) with respect to such
Finance Obligations other than (A) contingent indemnification obligations, Swap
Obligations and Cash Management Obligations not then due and payable and (B) to
the extent covered by clause (ii) below, obligations with respect to
undrawn Letters of Credit, payment in full thereof in cash (or otherwise to the
written satisfaction of the Finance Parties owed such Finance Obligations),
(ii) with respect to any undrawn Letter of Credit, the obligations under which
are included in such Finance Obligations, (A) the cancellation thereof and
payment in full of all resulting Finance Obligations pursuant to clause (i)
above or (B) the receipt of cash collateral (or a backstop letter of credit in
respect thereof on terms acceptable to the applicable L/C Issuer and the
Administrative Agent) in an amount at least equal to 102% of the L/C Obligations
for such Letter of Credit and (iii) if such Finance Obligations consist of all
the Senior Credit Obligations under or in respect of the Revolving Commitments
or the Term B Commitments, termination of all Commitments and all other
obligations of the Lenders in respect of such Commitments under the Loan
Documents.

“Parent Holdings” means VeriFone Holdings,
Inc., a Delaware corporation, and its successors.

“Participation Interest” means a Credit
Extension by a Lender by way of a purchase of a participation interest in
Letters of Credit or L/C Obligations as provided in Section 2.05(d), in
Swing Line Loans as provided in Section 2.01(c)(vi) or in any Loans as
provided in Section 2.13.

“PBGC” means the Pension Benefit Guaranty
Corporation established pursuant to Subtitle A of Title IV of ERISA or any
entity succeeding to any or all of its functions under ERISA.

 27
 

 

“Perfection Certificate” means with respect to
any Loan Party a certificate, substantially in the form of Exhibit G-3
to this Agreement, completed and supplemented with the schedules and
attachments contemplated thereby to the satisfaction of the Collateral Agent
and duly executed by the chief executive officer and the chief legal officer of
such Loan Party.

“Permit” means any license, permit, franchise,
right or privilege, certificate of authority or order, or any waiver of the
foregoing, issued or issuable by any Governmental Authority.

“Permitted Business
Acquisition” means a Business Acquisition; provided that:

(i)            the Equity Interests or property or
assets acquired in such acquisition relate to a line of business similar to the
business of the Borrower or any of its Subsidiaries engaged in on the Closing
Date or reasonably related, ancillary or complementary thereto;

(ii)           the representations and warranties
made by the Loan Parties in each Loan Document shall be true and correct in all
material respects at and as of the date of such acquisition (as if made on such
date after giving effect to such acquisition), except to the extent such
representations and warranties expressly relate to an earlier date (in which
case such representations and warranties shall be true and correct in all
material respects at and as of such earlier date);

(iii)          the Administrative Agent or the
Collateral Agent, as applicable, shall have received all items in respect of
the Equity Interests or property or assets acquired in such acquisition (and/or
the seller thereof) required to be delivered by Section 6.12;

(iv)          in the case of an acquisition of the
Equity Interests of another Person, (A) except in the case of the incorporation
of a new Subsidiary, the board of directors (or other comparable governing
body) of such other Person shall have duly approved such acquisition and (B)
the Equity Interests acquired shall constitute 100% of the total Equity
Interests of the issuer thereof;

(v)           no Event of Default shall have
occurred and be continuing immediately before or immediately after giving
effect to such acquisition, and the Borrower shall have delivered to the
Administrative Agent a Pro-Forma Compliance Certificate demonstrating that,
upon giving effect to such acquisition on a Pro-Forma Basis, the Borrower shall
be in compliance with the Total Leverage Ratio specified in Section 7.17(a)
and the Fixed Charge Coverage Ratio specified in Section 7.17(b) hereof,
in each case (x) as of the last day of the most recent period of four
consecutive fiscal quarters of the Borrower which precedes or ends on the date
of such acquisition and (y) in the case of the Total Leverage Ratio, after computing
the maximum permitted ratio for any period by subtracting .25 from the
applicable maximum ratio specified therein for such period; and

(vi)          after giving effect to such
acquisition, the sum of (A) the excess of the Revolving Committed Amount over the
total Revolving Outstandings plus (B) unrestricted cash and Cash Equivalents of
Holdings and its Consolidated Subsidiaries shall be not less than $10,000,000;

and provided, further, that the term “Permitted Business
Acquisition” shall include a Business Acquisition not otherwise meeting the
requirements of the foregoing definition the terms and provisions of which have
been approved by the Required Lenders.

 28
 

 

“Permitted Joint Venture” means a joint
venture, in the form of a corporation, limited liability company, business
trust, joint venture, association, company or partnership, entered into by the
Borrower or any of its Subsidiaries which (i) is engaged in a line of business
related, ancillary or complementary to those engaged in by the Borrower and its
Subsidiaries and (ii) is formed or organized in a manner that limits the
exposure of the Borrower and its Subsidiaries for the liabilities thereof to
(A) the Investments of the Borrower and its Subsidiaries therein permitted
under Section 7.06(a)(xii) and (B) any Indebtedness of any Permitted
Joint Venture or any Guaranty Obligations by the Borrower or any of its
Subsidiaries in respect of such Indebtedness, which Indebtedness or Guaranty
Obligations are permitted at the time under Section 7.01.

“Permitted Liens” has the meaning specified in Section
7.02.

“Permitted Refinancing” means, with respect to
any Person, any modification, refinancing, refunding, renewal or extension of
any Indebtedness of such Person; provided that (i) the principal amount
(or accreted value, if applicable) thereof does not exceed the principal amount
(or accreted value, if applicable) of the Indebtedness so modified, refinanced,
refunded, renewed or extended except by an amount equal to a reasonable premium
or other reasonable amount paid, and fees and expenses reasonably incurred, in
connection with such modification, refinancing, refunding, renewal or extension
and by an amount equal to any existing commitments unutilized thereunder or as
otherwise permitted pursuant to Section 7.01, (ii) such modification,
refinancing, refunding, renewal or extension has a final maturity date equal to
or later than the final maturity date of, and has a Weighted Average Life to
Maturity equal to or greater than the Weighted Average Life to Maturity of, the
Indebtedness being modified, refinanced, refunded, renewed or extended, (iii)
if the Indebtedness being modified, refinanced, refunded, renewed or extended
is subordinated in right of payment to any Senior Credit Obligation, such
modification, refinancing, refunding, renewal or extension is subordinated in
right of payment to the applicable Senior Credit Obligations on terms at least
as favorable to the applicable Lenders as those contained in the documentation
governing the Indebtedness being modified, refinanced, refunded, renewed or
extended, (iv) the terms and conditions (including, if applicable, as to
collateral) of any such modified, refinanced, refunded, renewed or extended
Indebtedness are not materially less favorable to the Loan Parties or the
Lenders than the terms and conditions of the Indebtedness being modified,
refinanced, refunded, renewed or extended, (v) such modification, refinancing,
refunding, renewal or extension is incurred by the Person who is the obligor on
the Indebtedness being modified, refinanced, refunded, renewed or extended, and
(vi) at the time thereof, no Event of Default shall have occurred and be
continuing.

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

“Plan” means an employee pension benefit plan
which is covered by Title IV of ERISA or subject to the minimum funding
standards under Section 412 of the Code maintained by or contributed to by any
Group Company or any ERISA Affiliate including a Multiemployer Plan.

“Pledge Agreement” means Pledge Agreement,
substantially in the form of Exhibit G-2 hereto, dated as of the date
hereof among Parent Holdings, Holdings, the Borrower, the Subsidiary Guarantors
and the Collateral Agent, as the same may be amended, modified or supplemented
from time to time.

“Pledged Collateral” has the meaning specified
in the Pledge Agreement.

 29
 

 

“Pre-Commitment Information” means, taken as an
entirety, the information with respect to the Borrower and its Subsidiaries
contained in the Confidential Information Memorandum dated September 2006.

“Preferred Stock” means, as applied to the
Equity Interests of a Person, Equity Interests of any class or classes (however
designated) which is preferred as to the payment of dividends or distributions,
or as to the distribution of assets upon any voluntary or involuntary
liquidation or dissolution of such Person, over the Equity Interests of any
other class of such Person.

“Prepayment Account” has the meaning specified
in Section 2.09(b)(viii).

“Proceeds” has the meaning specified for such
term in the Uniform Commercial Code as in effect from time to time in the State
of New York.

“Principal Amortization Payment” means a
scheduled principal payment on the Term B Loans pursuant to Section 2.08(b).

“Principal Amortization Payment Date” means (i)
with respect to the Term B Loans, the last Business Day of each calendar
quarter, commencing with the first such date occurring at least 90 days after
the Closing Date, and ending prior to the later of the Term B Maturity Date, or
(ii) the Term B Maturity Date.

“Pro-Forma Basis” means, for purposes of
determining compliance with any provision hereof, that the transaction in
question shall be deemed to have occurred as of the first day of the most
recent period of four consecutive fiscal quarters of the Borrower which most
recently precedes or ends on the date of such transaction and with respect to
which the Administrative Agent has received the financial information for
Parent Holdings and its Consolidated Subsidiaries required under Section
6.01(a) or (b), as applicable, and the Compliance Certificate
required by Section 6.02(b) for such period.  In connection with any calculation of the
financial covenants set forth in Section 7.17 upon giving effect to a
transaction on a “Pro-Forma Basis”, (i) any Indebtedness incurred by the
Borrower or any of its Subsidiaries in connection with such transaction (or any
other transaction which occurred during the relevant four fiscal quarter
period) shall be deemed to have been incurred as of the first day of the
relevant four fiscal-quarter period, (ii) if such Indebtedness has a floating
or formula rate, then the rate of interest for such Indebtedness for the applicable
period for purposes of the calculations contemplated by this definition shall
be determined by utilizing the rate which is or would be in effect with respect
to such Indebtedness as at the relevant date of such calculations, (iii) income
statement items (whether positive or negative) attributable to all property
acquired in such transaction or to the Investment comprising such transaction,
as applicable, shall be included as if such transaction has occurred as of the
first day of the relevant four-fiscal-quarter period, (iv) such other
pro-forma adjustments which would be permitted or required by Regulations S-K
and S-X under the Securities Act shall be taken into account and (v) such other
adjustments made by the Borrower with the consent of the Administrative Agent
(not to be unreasonably withheld) shall be taken into account.

“Pro-Forma Compliance Certificate” means a
certificate of the chief financial officer or chief accounting officer of the
Borrower delivered to the Administrative Agent in connection with any
transaction for which a calculation on a “Pro-Forma Basis” is permitted or
required hereunder and containing reasonably detailed calculations
demonstrating, upon giving effect to the applicable transaction on a Pro-Forma
Basis, compliance, as applicable, with the Total Leverage Ratio and the Fixed
Charge Coverage Ratio specified in Section 7.17 as of the last day of
the most recent period of four consecutive fiscal quarters of Holdings which
precedes or ends on the date of the applicable transaction and with respect to
which the Administrative Agent shall have received the consolidated financial
information for 

 30
 

 

Parent Holdings and its
Consolidated Subsidiaries required under Section 6.01(a) or (b),
as applicable, and the Compliance Certificate required by Section 6.02(b)
for such period.

“Public Debt Issuance” has the meaning
specified in Section 7.01(xvi).

“Purchase Money Indebtedness” means
Indebtedness of the Borrower or any of its Subsidiaries incurred for the
purpose of financing all or any part of the purchase price or cost of
construction or improvement of property used in the business of the Borrower or
such Subsidiary.

“Qualified Capital Stock” means common stock of
Parent Holdings issued in a Qualifying Equity Issuance.

“Qualifying Equity Issuance” means any issuance
of Equity Interests by Parent Holdings or any receipt by Parent Holdings of a
capital contribution, the Net Cash Proceeds of which are contributed promptly
to the common equity of the Borrower if: 
(i) after giving effect thereto, no Change of Control shall have
occurred; and (ii) the Net Cash Proceeds thereof shall be used (without
duplication) only (A) to make Consolidated Capital Expenditures in excess
of the amounts allowed under Section 7.14, (B) to make Investments
in Permitted Joint Ventures in excess of the amounts allowed under Section
7.06(a)(xii), (C) to make Permitted Business Acquisitions, (D) to make
Investments contemplated by, but in excess of the amounts allowed under, Section
7.06(a)(xvi), (E) to repay Indebtedness of the Borrower and its
Subsidiaries, (F) to make Restricted Payments in excess of the amounts
allowed under Section 7.07(iii), (iv) and (v) and (G) to
fund Investments contemplated by Section 7.06(a)(xv)(A)(x).

“Real Property” means, with respect to any
Person, all of the right, title and interest of such Person in and to land,
improvements and fixtures, including Leaseholds.

“Refinanced Agreements” means the Existing
Credit Agreement and those instruments, documents and agreements of Lipman and
its Subsidiaries listed on Schedule 1.01B.

“Refinancing” means the termination of the
commitments under the Refinanced Agreements and the repayment in full of all
Indebtedness, other obligations and liabilities owing by the Group Companies
thereunder.

“Refunded Swing Line Loan” has the meaning
specified in Section 2.01(c)(iii).

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

“Regulation D, O, T, U or X” means Regulation
D, O, T, U or X, respectively, of the Board of Governors of the Federal Reserve
System as amended, or any successor regulation.

“Reinvestment Funds” means, with respect to any
Insurance Proceeds or any Condemnation Award exceeding $10,000,000 in respect
of the single event or series of related events giving rise thereto, that portion
of such funds as shall, according to a certificate of a Responsible Officer of
the Borrower delivered to the Administrative Agent within 30 days after the
occurrence of the Casualty or Condemnation giving rise thereto (and in any case
prior to the receipt thereof by any Group Company), be reinvested within 365
days after the occurrence of the Casualty or Condemnation giving rise thereto
in the repair, restoration or replacement of the properties that were the
subject of such Casualty or Condemnation; provided that (i) such
certificate shall be accompanied by evidence reasonably satisfactory to the
Administrative Agent that any property subject to such Casualty or Condemnation
has been or will be repaired, restored or replaced to its condition immediately
prior to such Casualty or Condemnation, (ii) pending such reinvestment, the
entire amount of such proceeds shall be deposited in 

 31
 

 

an account with the
Collateral Agent for the benefit of the Finance Parties, over which the
Collateral Agent shall have sole control and exclusive right of withdrawal
(which may include the Reinvestment Funds Account established under the
Security Agreement), (iii) from and after the date of delivery of such
certificate, the Borrower or one or more of its Subsidiaries shall diligently
proceed, in a commercially reasonable manner, to complete the repair,
restoration or replacement of the properties that were the subject of such
Casualty or Condemnation as described in such certificate and (iv) no Event of
Default shall have occurred and be continuing or, if the Borrower or one or
more of its Subsidiaries shall have then entered into one or more continuing
agreements with a Person not an Affiliate of any of them for the repair,
restoration or replacement of the properties that were the subject of such
Casualty or Condemnation, none of the Administrative Agent or the Collateral
Agent shall have commenced any action or proceeding to exercise or seek to
exercise an right or remedy with respect to any Collateral (including any
action of foreclosure, enforcement, collection or execution or by and
proceeding under any Debtor Relief Law with respect to any Loan Party); and provided,
further, that, if any of the foregoing conditions shall cease to be
satisfied at any time, such funds shall no longer be deemed Reinvestment Funds
and such funds shall immediately be applied to prepayment of the Loans in
accordance with Section 2.09(b).

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

“Release” means, with respect to any Person,
any release, spill, emission, leaking, pumping, injection, deposit, disposal,
discharge, dispersal, leaching or migration, in each case, of any Hazardous
Materials into the indoor or outdoor environment or into or out of any property
owned, leased or operated by such Person, including the movement of Hazardous
Materials through or in the air, soil, surface water, ground water or property.

“Required Lenders” means at any date of
determination, Lenders holding more than 50% of the sum of (i) the Total
Outstandings (with the aggregate amount of each Lender’s risk participation and
funded participation in L/C Obligations and Swing Line Loans being deemed “held”
by such Lender for purposes of this definition), (ii) the aggregate unused Term
B Commitments, if any, and (iii) the aggregate unused Revolving Commitments, if
any.  A Defaulting Lender shall not be
included in the calculation of the “Required Lenders”.

“Required Revolving Lenders” means,
collectively, Revolving Lenders having more than 50% of the aggregate Revolving
Commitments or, after the Revolving Termination Date, more than 50% of the
aggregate Revolving Outstandings.  A
Defaulting Lender shall not be included in the calculation of “Required
Revolving Lenders”.

“Required Term B Lenders” means, collectively,
Term B Lenders having more than 50% of the aggregate amount of the Term B
Commitments or, after the Availability Period for Term B Loans, more than 50%
of the principal amount of the Term B Loans then outstanding.  A Defaulting Lender shall not be included in
the calculation of “Required Term B Lenders”.

“Responsible Officer” means the chief executive
officer, president, senior vice president, chief financial officer or treasurer
of a Loan Party.  Any document delivered
hereunder that is signed by a Responsible Officer of a Loan Party shall be
conclusively presumed to have been authorized by all necessary corporate,
partnership and/or other action on the part of such Loan Party and such
Responsible Officer shall be conclusively presumed to have acted on behalf of
such Loan Party.

 32
 

 

“Restricted Payment” means (i) any dividend or
other distribution (whether in cash, securities or other property), direct or
indirect, on account of any class of Equity Interests or Equity Equivalents of
any Group Company, now or hereafter outstanding, (ii) any payment (whether in
cash, securities or other property), including any sinking fund or similar
deposit, on account of the purchase, redemption, retirement, acquisition,
cancellation, termination or similar payment, purchase or other acquisition for
value, direct or indirect, of any class of Equity Interests or Equity
Equivalents of any Group Company, now or hereafter outstanding or (iii) any
payment made to retire, or to obtain the surrender of, any outstanding
warrants, options or other rights to acquire any class of Equity Interests or
Equity Equivalents of any Group Company, now or hereafter outstanding.

“Revolving Borrowing” means a Borrowing
comprised of Revolving Loans and identified as such in the Notice of Borrowing
with respect thereto.

“Revolving Commitment” means, with respect to
any Lender, (i) the commitment of such Lender, in an aggregate principal amount
at any time outstanding of up to such Lender’s Revolving Commitment Percentage
of the Revolving Committed Amount, (A) to make Revolving Loans in accordance
with the provisions of Section 2.01(a), (B) to purchase Participation
Interests in Swing Line Loans in accordance with the provisions of Section
2.01(c) and (C) to purchase Participation Interests in Letters of Credit in
accordance with the provisions of Section 2.05(d) and (ii) any such
commitment of such Lender that is included as part of a Facilities Increase.

“Revolving Commitment Percentage” means, for
each Lender, the percentage (carried out to the ninth decimal place) identified
as its Revolving Commitment Percentage on Schedule 2.01 hereto, as such
percentage may be adjusted pursuant to Section 2.10 or modified in
connection with any assignment made in accordance with the provisions of Section
10.07(b).

“Revolving Committed Amount” means $40,000,000
or such greater or lesser amount to which the Revolving Committed Amount may be
adjusted pursuant to Section 2.10.

“Revolving Lender” means each Lender identified
in Schedule 2.01 as having a Revolving Commitment and each Eligible
Assignee which acquires a Revolving Commitment or Revolving Loan pursuant to Section
10.07(b) and their respective successors.

“Revolving Loan” means a Loan made under Section
2.01(a).

“Revolving Note” means a promissory note,
substantially in the form of Exhibit B-1 hereto, evidencing the
obligation of the Borrower to repay outstanding Revolving Loans, as such note
may be amended, modified, supplemented, extended, renewed or replaced from time
to time.

“Revolving Outstandings” means at any date the
aggregate outstanding principal amount of all Revolving Loans and Swing Line
Loans plus the aggregate outstanding amount of all L/C Obligations.

“Revolving Termination Date” means the sixth
anniversary of the Closing Date (or, if such day is not a Business Day, the
next preceding Business Day) or such earlier date upon which the Revolving
Commitments shall have been terminated in their entirety in accordance with
this Agreement.

“Sale/Leaseback Transaction” means any direct
or indirect arrangement with any Person (other than Holdings or any of its
Subsidiaries) or to which any such Person is a party providing for the leasing
to Holdings or any of its Subsidiaries of any property, whether owned by
Holdings or any of its Subsidiaries as of the Closing Date or later acquired,
which has been or is to be sold or transferred by 

 33
 

 

Holdings or any of its
Subsidiaries to such Person or to any other Person from whom funds have been,
or are to be, advanced by such Person to Holdings or any if its Subsidiaries on
the security of such property.

“S&P” means Standard & Poor’s Ratings
Group, a division of McGraw Hill, Inc., a New York corporation, and its
successors or, absent any such successor, such nationally recognized
statistical rating organization as the Borrower and the Administrative Agent
may select.

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

“Securities Act” means the Securities Act of
1933, as amended, and the rules and regulations promulgated thereunder.

“Security Agreement” means the Security
Agreement, substantially in the form of Exhibit G-1 hereto, dated
as of the date hereof among Parent Holdings, Holdings, the Borrower, the
Subsidiary Guarantors and the Collateral Agent, as the same may be amended,
modified or supplemented from time to time.

“Senior Credit
Obligations” means, with respect to each Loan Party, without duplication:

(i)            in the case of the Borrower, all
principal of and interest (including, without limitation, any interest which
accrues after the commencement of any proceeding under any Debtor Relief Law
with respect to the Borrower, whether or not allowed or allowable as a claim in
any such proceeding) on any Revolving Loan, Term B Loan or L/C Obligation
under, or any Revolving Note, Term B Note or Swingline Note issued pursuant to,
this Agreement or any other Loan Document;

(ii)           all fees, expenses, indemnification
obligations and other amounts of whatever nature now or hereafter payable by
such Loan Party under any Loan Document in respect of any Revolving Loan, Term
B Loan or L/C Obligation under, or any Revolving Note, Term B Note or Swingline
Note issued pursuant to, this Agreement or any other Loan Document (including,
without limitation, any amounts which accrue after the commencement of any
proceeding under any Debtor Relief Law with respect to such Loan Party, whether
or not allowed or allowable as a claim in any such proceeding) pursuant to this
Agreement or any other Loan Document;

(iii)          all expenses of the Administrative
Agent or the Collateral Agent as to which such Agent have a right to
reimbursement by such Loan Party under Section 10.04 of this Agreement
or under any other similar provision of any other Loan Document, including,
without limitation, any and all sums advanced by the Collateral Agent to
preserve the Collateral or preserve its security interests in the Collateral to
the extent permitted under any Loan Document or applicable Law;

(iv)          all amounts paid by any Indemnitee in
respect of any Revolving Loan, Term B Loan or L/C Obligation under, or any
Revolving Note, Term B Note or Swingline Note issued pursuant to, this
Agreement or any other Loan Document as to which such Indemnitee has the right
to reimbursement by such Loan Party under Section 10.05 of this
Agreement or under any other similar provision of any other Loan Document; and

(v)           in the case of Parent Holdings,
Holdings and each Subsidiary Guarantor, all amounts now or hereafter payable by
Parent Holdings, Holdings or such Subsidiary Guarantor 

 34
 

 

and all other obligations or liabilities now
existing or hereafter arising or incurred (including, without limitation, any
amounts which accrue after the commencement of any proceeding under any Debtor
Relief Law with respect to the Borrower, Parent Holdings, Holdings or such
Subsidiary Guarantor under or in respect of any Revolving Loan, Swing Line
Loan, Term B Loan or L/C Obligation under, or any Revolving Note, Swing Line
Note or Term B Note issued pursuant to, this Agreement or any other Loan
Document, whether or not allowed or allowable as a claim in any such
proceeding) on the part of Parent Holdings, Holdings or such Subsidiary
Guarantor pursuant to this Agreement, the Guaranty or any other Loan Document;

together in each case
with all renewals, modifications, consolidations or extensions thereof.

“Senior Credit Party” means each Lender (including
any Affiliate in respect of any Cash Management Obligations), each L/C Issuer,
the Administrative Agent, the Collateral Agent and each Indemnitee in respect
of Loans and their respective successors and assigns, and “Senior Credit
Parties” means any two or more of them, collectively.

“Senior Leverage Ratio” means on any day the
ratio of (i) Consolidated Funded Indebtedness (exclusive of Subordinated
Indebtedness) as of the last day of the fiscal quarter of Holdings ending on,
or most recently preceding, such date, less Cash on Hand, to (ii) Consolidated
EBITDA for the four consecutive fiscal quarters of Holdings ended on, or most
recently preceding, such day.

“Solvent” means, with respect to any Person as
of a particular date, that on such date (i) such Person is able generally
to pay its debts and other liabilities, contingent obligations and other
commitments as they mature in the normal course of business, (ii) such Person
does not intend to, and does not believe that it will, incur debts beyond such
Person’s ability to pay as such debts mature, (iii) such Person is not
engaged in a business or a transaction, and is not about to engage in a
business or a transaction, for which such Person’s assets would constitute
unreasonably small capital after giving due consideration to the prevailing
practice in the industry in which such Person is engaged or is to engage, (iv)
the fair value (determined on a going concern basis and in accordance with the
United States Bankruptcy Code) of the assets of such Person is greater than the
total amount of liabilities, including, without limitation, probable
liabilities, of such Person and (v) the present fair value (i.e., the amount
that may be realized within a commercially reasonable time, either through
collection or sale at the regular market value, conceiving the latter as the
amount that could be obtained for the assets in question within such period by
a capable and diligent businessperson from a buyer who is willing to purchase
under ordinary selling conditions) of the assets of such Person will exceed the
amount that will be required to pay the probable liability on such Person’s
existing debts as they become absolute and matured.  For purposes of this definition, “debt” means
any legal liability, whether matured, unmatured, liquidated or unliquidated,
absolute, fixed or contingent, or a right to an equitable remedy for breach of
performance if such breach gives rise to a payment, whether or not such right
is an equitable remedy, is reduced to judgment, liquidated, unliquidated,
fixed, contingent, matured, unmatured, disputed, undisputed, secured or
unsecured.  In computing the amount of
contingent or unliquidated liabilities at any time, such liabilities shall be
computed at the amount that, in light of all the facts and circumstances
existing at such time, represents the amount that can reasonably be expected to
become an actual or matured liability (in each case as interpreted in
accordance with applicable Debtor Relief Laws).

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

“Standby Letter of Credit” has the meaning
specified in Section 2.05(a).

“Standby Letter of Credit Fee” has the meaning
specified in Section 2.11(b)(i).

 35

 

“Subordinated Indebtedness” of any Person means
all unsecured Indebtedness (i) the principal of which by its terms is not
required to be repaid, in whole or in part, before the first anniversary of the
latest of the Revolving Termination Date and the Term B Maturity Date, (ii)
which is subordinated in right of payment to such Person’s indebtedness,
obligations and liabilities to the Senior Credit Parties under the Loan
Documents pursuant to payment and subordination provisions reasonably
satisfactory in form and substance to the Administrative Agent and (iii) is
issued pursuant to documents having covenants, subordination provisions and
events of default that are in no event less favorable, including with respect
to rights of acceleration, to such Person than the terms hereof or are
otherwise reasonably satisfactory in form and substance to the Administrative
Agent and the Collateral Agent.

“Subsidiary” means, with respect to any Person,
any corporation, partnership, limited liability company, association or other
business entity of which more than 50% of the Voting Securities or the
partnership or other similar ownership interests thereof is at the time owned
or controlled, directly or indirectly, by that Person or one or more
Subsidiaries of that Person or a combination thereof.  For purposes hereof, a Person or Persons
shall be deemed to have more than 50% ownership interest in a partnership,
limited liability company, association or other business entity if such Person
or Persons shall be allocated more than 50% of partnership, association or
other business entity gains or losses or shall be or control the managing
director, manager or a general partner of such partnership, association or
other business entity.  Unless otherwise
specified, all references herein to a “Subsidiary” or to “Subsidiaries” shall
refer to a Subsidiary or Subsidiaries of the Borrower (including Lipman after
giving effect to the Merger).

“Subsidiary Guarantor” means each Subsidiary of
Holdings on the Closing Date (other than the Borrower and a Foreign Subsidiary)
and each Subsidiary of Holdings (other than a Foreign Subsidiary, except to the
extent otherwise provided in Section 6.12(d)) that becomes a party to
the Guaranty after the Closing Date by execution of an Accession Agreement, and
“Subsidiary Guarantors” means any two or more of them.

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

“Swap Creditor” means any Lender or any
Affiliate of any Lender from time to time party to one or more Swap Agreements
permitted hereunder with a Loan Party (even if any such Lender for any reason
ceases after the execution of such agreement to be a Lender hereunder), and its
successors and assigns, and “Swap Creditors” means any two or more of
them, collectively.

“Swap Obligations” of any Person means all
obligations (including, without limitation, any amounts which accrue after the
commencement of any bankruptcy or insolvency proceeding with respect to such
Person, whether or not allowed or allowable as a claim under any proceeding
under any 

 36
 

 

Debtor Relief Law) of
such Person in respect of any Swap Agreement, excluding any amounts which such
Person is entitled to set-off against its obligations under applicable Law.

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

“Swing Line Borrowing” means a Borrowing
comprised of Swing Line Loans and identified as such in the Swing Line Loan
Request with respect thereto.

“Swing Line Commitment” means the agreement of
the Swing Line Lender to make Loans pursuant to Section 2.01(c).  The Swing Line Commitment is a part of, and
not in addition to, the Revolving Committed Amount.

“Swing Line Committed Amount” means
$20,000,000, as such Swing Line Committed Amount may be reduced pursuant to Section
2.10.

“Swing Line Lender” means JPMCB, in its
capacity as the Swing Line Lender under Section 2.01(c), and its
successor or successors in such capacity.

“Swing Line Loan” means a Base Rate Loan made
by the Swing Line Lender pursuant to Section 2.01(c), and “Swing Line
Loans” means any two or more of such Base Rate Loans.

“Swing Line Loan Request” has the meaning
specified in Section 2.02(b).

“Swing Line Note” means a promissory note,
substantially in the form of Exhibit B-3 hereto, evidencing the
obligation of the Borrower to repay outstanding Swing Line Loans, as such note
may be amended, modified, supplemented, extended, renewed or replaced from time
to time.

“Swing Line Termination Date” means the earlier
of (i) sixth anniversary of the Closing Date (or, if such day is not a Business
Day, the next preceding Business Day) or such earlier date upon which the
Revolving Commitments shall have been terminated in their entirety in
accordance with this Agreement and (ii) the date on which the Swing Line
Commitment is terminated in its entirety in accordance with this Agreement.

“Syndication Agent” means LCPI in its capacity
as syndication agent under any of the Loan Documents.

“Syndication Date” means the earlier of (i) the
date which is 90 days after the Closing Date and (ii) the date on which the
Administrative Agent determines in its sole discretion (and notifies the
Borrower) that the primary syndication (and the resulting addition of Lenders
pursuant to Section 10.07(b)) has been completed.

“Synthetic Lease Obligation” means the monetary
obligation of a Person under (i) a so-called synthetic, off-balance sheet or
tax retention lease or (ii) an agreement for the use or possession of property
creating obligations that do not appear on the balance sheet of such Person but
which, upon the 

 37
 

 

insolvency or bankruptcy
of such Person, would be characterized as the indebtedness of such person
(without regard to accounting treatment).

“Taxes” has the meaning specified in Section
3.01.

“Term B Borrowing” means a Borrowing comprised
of Term B Loans and identified as such in the Notice of Borrowing with respect
thereto.

“Term B Commitment” means, with respect to any
Lender, as applicable, (i) the commitment of such Lender to make  Term B Loans during the Availability Period
for Term B Loans in a principal amount equal to such Lender’s Term B Commitment
Percentage of the Term B Committed Amount and (ii) any commitment of such
Lender that is included as part of a Facilities Increase to make Term B Loans
on any Facilities Increase Date.

“Term B Commitment Percentage” means, for each
Lender, the percentage (carried out to the ninth decimal place) identified as
its Term B Commitment Percentage on Schedule 2.01, as such percentage
may be adjusted pursuant to Section 2.10 or modified in connection with
any assignment made in accordance with the provisions of Section 10.07(b).

“Term B Committed Amount” means $500,000,000.

“Term B Lender” means each bank or other
lending institution identified on Schedule 2.01 as having a Term B
Commitment and (ii) each Eligible Assignee which acquires a Term B Loan
pursuant to Section 10.07(b) and their respective successors.

“Term B Loan” means a Loan made under Section
2.01(b) and “Term B Loans” means two or more of them, collectively.

“Term B Maturity Date” means the seventh
anniversary of the Closing Date (or if such day is not a Business Day, the next
preceding Business Day).

“Term B Note” means a promissory note, dated as
of the date of issue and substantially in the form of Exhibit B-2
hereto, evidencing the obligation of the Borrower to repay outstanding Term B
Loans, as such note may be amended, modified or supplemented from time to time.

“Term Loan” means a Term B Loan, and “Term
Loans” means any two or more of them, collectively.

“Threshold Amount” means $5,000,000.

“Total Leverage Ratio” means on any day the
ratio of (i) Consolidated Funded Indebtedness as of the last day of the fiscal
quarter of Holdings ending on, or most recently preceding, such date, less Cash
on Hand, to (ii) Consolidated EBITDA for the four consecutive fiscal quarters
of Holdings ended on, or most recently preceding, such day.

“Total Outstandings” means, at any date the
aggregate Outstanding Amount of all Loans and all L/C Obligations.

“Trade Letter of Credit” has the meaning
specified in Section 2.05(a).

“Trade Letter of Credit Fee” has the meaning
specified in Section 2.11(b)(ii).

 38
 

 

“Transaction” means the borrowing of the Loans
on the Closing Date and of Term B Loans during the Availability Period for Term
B Loans, the Merger, the Refinancing and the other events contemplated hereby
and thereby to occur in connection therewith.

“Transaction Documents” means all agreements,
instruments and documents relating to the Transaction.

“Type” has the meaning specified in Section
1.08.

“Unfunded Liabilities” means, except as
otherwise provided in Section 5.12(a)(1)(B), (i) with respect to each
Plan, the amount (if any) by which the present value of all nonforfeitable
benefits under each Plan exceeds the current value of such Plan’s assets
allocable to such benefits, all determined in accordance with the respective
most recent valuations for such Plan using applicable PBGC plan termination
actuarial assumptions (the terms “present value” and “current value” shall have
the same meanings specified in Section 3 of ERISA) and (ii) with respect to
each Foreign Pension Plan, the amount (if any) by which the present value of
all nonforfeitable benefits under each Foreign Pension Plan exceeds the current
value of such Foreign Pension Plan’s assets allocable to such benefits, all
determined in accordance with the respective most recent valuations for such
Plan using the most recent actuarial assumptions and methods being used by the
Foreign Pension Plan’s actuaries for financial reporting under applicable
accounting and reporting standards.

“United States” means the United States of
America, including each of the States and the District of Columbia, but
excluding its territories and possessions.

“U.S. Patriot Act” means the Uniting and
Strengthening America by Providing Appropriate Tools Required to Intercept and
Obstruct Terrorism Act of 2001 (Title III of Pub. L. 107-56 (signed into Law
October 26, 2001)), as the same may be amended, supplemented, modified, replaced
or otherwise in effect from time to time.

“Unreimbursed Amount” has the meaning specified
in Section 2.05(e)(iv).

“Unused Revolving Commitment Amount” means, for
any period, the amount by which (i) the then applicable Revolving Committed
Amount exceeds (ii) the daily average sum for such period of (A) the aggregate
principal amount of all outstanding Revolving Loans plus (B) the aggregate
amount of all outstanding L/C Obligations. 
For the avoidance of doubt, no deduction shall be made on account of
outstanding Swing Line Loans in calculating the Unused Revolving Commitment
Amount.

“Voting Securities” means Equity Interests of
any Person having ordinary power to vote in the election of members of the
board of directors, managers, trustees or other controlling Persons of such
Person (irrespective of whether, at the time, Equity Interests of any other
class or classes of such Person shall have or might have voting power by reason
of the happening of any contingency).

“Weighted Average Life to Maturity” means, when
applied to any Indebtedness at any date, the number of years obtained by
dividing:  (i) the sum of the products
obtained by multiplying (A) the amount of each then remaining installment,
sinking fund, serial maturity or other required payments of principal,
including payment at final maturity, in respect thereof, by (B) the number of
years (calculated to the nearest one-twelfth) that will elapse between such
date and the making of such payment; by (ii) the then outstanding principal
amount of such Indebtedness.

“Welfare Plan” means a “welfare plan” as such
term is defined in Section 3(1) of ERISA.

 39
 

 

“Wholly-Owned Subsidiary” means, with respect
to any Person at any date, any Subsidiary of such Person all of the shares of
capital stock or other ownership interests of which (except directors’
qualifying shares) are at the time directly or indirectly owned by such Person.

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

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

(b)           The words “herein,”
“hereto,” “hereof” and “hereunder” and words of similar
import when used in any Loan Document shall refer to such Loan Document as a
whole and not to any particular provision thereof.  Article, Section, Exhibit and Schedule
references are to the Loan Document in which such reference appears.  The term “including” is by way of example
and not limitation.  The term “documents”
includes any and all instruments, documents, agreements, certificates, notices,
reports, financial statements and other writings, however evidenced, whether in
physical or electronic form.

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

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

Section 1.03 
Accounting Terms and
Determinations.  Except as otherwise expressly provided
herein, all accounting terms used herein shall be interpreted, and all
financial statements and certificates and reports as to financial matters
required to be delivered to the Lenders hereunder shall be prepared, in
accordance with GAAP applied on a consistent basis.  All financial statements delivered to the
Lenders hereunder shall be accompanied by a statement from the Borrower that
GAAP has not changed since the most recent financial statements delivered by
the Borrower to the Lenders or if GAAP has changed describing such changes in
detail and explaining how such changes affect the financial statements.  All calculations made for the purposes of
determining compliance with this Agreement shall (except as otherwise expressly
provided herein) be made by application of GAAP applied on a basis consistent
with the most recent annual or quarterly financial statements delivered
pursuant to Section 6.01 (or, prior to the delivery of the first
financial statements pursuant to Section 6.01, consistent with the
financial statements described in Section 5.05(a) (but without giving
effect to any deviations from GAAP disclosed therein)); provided, however,
that (i) if (A) the Borrower shall object to determining such compliance on
such basis at the time of delivery of such financial statements due to any
change in GAAP or the rules promulgated with respect thereto or (B) either the
Administrative Agent or the Required Lenders shall so object in writing within
60 days after delivery of such financial statements (or after the Lenders have
been informed of the change in GAAP affecting such financial statements, if
later), then such calculations shall be made on a basis consistent with the
most recent financial statements delivered by the Borrower to the Lenders as to
which no such objection shall have been made, and the Borrower shall provide to
the Administrative Agent and the Lenders financial statements and other
documents required under this Agreement or as reasonably requested hereunder
setting forth a reconciliation between calculations made before and after
giving effect to such change in GAAP and (ii) if any change in GAAP or the
rules promulgated with respect thereto from those used in the preparation of
the most recent annual or quarterly financial statements delivered pursuant to Section
6.01 (or, prior to the delivery of the first financial statements pursuant
to Section 6.01, the financial statements described in Section
5.05(a) (but without giving effect to any deviations from GAAP disclosed
therein) results in a change in any of the 

 40
 

 

financial
calculations required by Section 7.17 or otherwise specified in Article
VII (including in each case all related definitions specified in Section
1.01) that would not have resulted had such accounting change not occurred,
the parties hereto agree to enter into negotiations in order to amend such
provisions so as equitably to reflect such change such that the criteria for
evaluation compliance with such covenants shall be the same after such changes
as if such change had not been made.

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

Section 1.05 
References to Agreements
and Laws.  Unless otherwise expressly provided herein,
(i) references to Organization Documents, agreements (including the Loan
Documents) and other contractual instruments shall be deemed to include all
subsequent amendments, restatements, extensions, supplements and other
modifications thereto, but only to the extent that such amendments,
restatements, extensions, supplements and other modifications are not
prohibited by any Loan Document; and (ii) references to any Law shall include
all statutory and regulatory provisions consolidating, amending, replacing,
supplementing or interpreting such Law.

Section 1.06 
Times of Day. 
Unless otherwise specified, all references herein to times of day shall
be references to Eastern time (daylight or standard, as applicable).

Section 1.07 
Letter of Credit Amounts.  Unless otherwise specified, all references
herein to the amount of a Letter of Credit at any time shall be deemed to mean
the maximum face amount of such Letter of Credit after giving effect to all
increases thereof contemplated by such Letter of Credit or the L/C Documents
related thereto, whether or not such maximum face amount is in effect at such
time.

Section 1.08 
Classes and Types of
Borrowings.  The term “Borrowing” denotes the
aggregation of Loans of one or more Lenders made to the Borrower pursuant to Article
II on the same date, all of which Loans are of the same Class and Type
(subject to Article III) and, except in the case of Base Rate Loans,
have the same initial Interest Period. 
Loans hereunder are distinguished by “Class” and “Type”.  The “Class” of a Loan (or of a
Commitment to make such a Loan or of a Borrowing comprised of such Loans)
refers to whether such Loan is a Revolving Loan or a Term B Loan.  The “Type” of a Loan refers to whether
such Loan is a Eurodollar Loan or a Base Rate Loan.  Identification of a Loan (or a Borrowing) by
both Class and Type (e.g., a “Term B Eurodollar Loan”) indicates that such Loan
is a Loan of both such Class and such Type (e.g., both a Term B Loan and a
Eurodollar Loan) or that such Borrowing is comprised of such Loans.

ARTICLE
II

THE CREDIT FACILITIES

Section 2.01 
Commitments to Lend.

(a)           Revolving Loans.  Each Revolving Lender severally agrees, on
the terms and conditions set forth in this Agreement, to make Revolving Loans
to the Borrower pursuant to this Section 2.01(a) from time to time
during the Availability Period for Revolving Loans in amounts such that its
Revolving Outstandings shall not exceed (after giving effect to all Revolving
Loans repaid, all reimbursements of L/C Disbursements made, and all Refunded
Swing Line Loans paid concurrently with the making of any Revolving Loans) its
Revolving Commitment; provided that, immediately after giving 

 41
 

 

effect to each
such Revolving Loan, (i) the aggregate Revolving Outstandings shall not exceed
the Revolving Committed Amount and (ii) with respect to each Revolving Lender
individually, such Lender’s outstanding Revolving Loans plus its (other than
the Swing Line Lender’s in its capacity as such) Participation Interests in
outstanding Swing Line Loans plus its Participation Interests in outstanding
L/C Obligations shall not exceed such Lender’s Revolving Commitment Percentage
of the Revolving Committed Amount.  Each
Revolving Borrowing comprised of Eurodollar Loans shall be in an aggregate
principal amount of $1,000,000 or any larger multiple of $500,000, and each
Revolving Borrowing comprised of Base Rate Loans shall be in an aggregate
principal amount of $500,000 or any larger multiple of $100,000 (except that
any such Borrowing may be in the aggregate amount of the unused Revolving
Commitments and any L/C Borrowing may be in the aggregate amount of any
outstanding Unreimbursed Amounts owed to one or more L/C Issuers as provided in
Section 2.05(e)(iv)) and shall be made from the several Revolving
Lenders ratably in proportion to their respective Revolving Commitments.  Within the foregoing limits, the Borrower may
borrow under this Section 2.01(a), repay, or, to the extent permitted by
Section 2.09, prepay, Revolving Loans and reborrow under this Section
2.01(a).

(b)           Term B Loans.  Each Term B Lender severally agrees, on the
terms and conditions set forth in this Agreement, to make Term B Loans to the
Borrower from time to time during the Availability Period for Term B Loans in
an aggregate principal amount not exceeding its Term B Commitment.  Each Term B Borrowing comprised of Eurodollar
Loans shall be in an aggregate principal amount of $1,000,000 or any larger
multiple of $500,000, and each Term B Borrowing comprised of Base Rate Loans
shall be in an aggregate principal amount of $500,000 or any larger multiple of
$100,000 (except that any such Borrowing may be in the aggregate amount of the
unused Term B Commitments) and shall be made from the several Term B Lenders
ratably in proportion to their respective Term B Commitments.  The Term B Commitments are not revolving in
nature, and amounts repaid or prepaid prior to the Term B Maturity Date may not
be reborrowed.  Each Term B Lender (or
Affiliate or Approved Fund thereof) or Eligible Assignee having, in its sole
discretion, committed to a Facilities Increase pursuant to Section 2.10(a)
shall agree as part of such commitment that, on the Facilities Increase Date
for such Facilities Increase in the aggregate Term B Commitments, on the terms
and subject to the conditions set forth in its commitment therefor or otherwise
agreed to as part of such commitment or set for in this Agreement as amended in
connection with such Facilities Increase, such Term B Lender (or Affiliate or
Approved Fund thereof) or Eligible Assignee will make a Term B Loan to the
Borrower on the Facilities Increase Date for such Facilities Increase in a
principal amount not to exceed such commitment to such Facilities Increase.

(c)           Swing Line Loans.

(i)            The Swing Line Lender agrees, on the
terms and subject to the conditions set forth herein and in the other Loan
Documents, to make a portion of the Revolving Commitments available to the
Borrower from time to time during the Availability Period by making Swing Line
Loans to the Borrower in Dollars (each such loan, a “Swing Line Loan”
and, collectively, the “Swing Line Loans”); provided that (A) the
aggregate principal amount of the Swing Line Loans outstanding at any one time
shall not exceed the Swing Line Committed Amount, (B) with regard to each Lender
individually (other than the Swing Line Lender in its capacity as such), such
Lender’s outstanding Revolving Loans plus its Participation Interests in
outstanding Swing Line Loans plus its Participation Interests in outstanding
L/C Obligations shall not at any time exceed such Lender’s Revolving Commitment
Percentage of the Revolving Committed Amount, (C) with regard to the Revolving
Lenders collectively, the sum of the aggregate principal amount of Swing Line
Loans outstanding plus the aggregate amount of Revolving Loans outstanding plus
the aggregate amount of L/C Obligations outstanding shall not exceed the  Revolving Committed Amount  and (D) the Swing Line Committed Amount shall
not 

 42
 

 

exceed the aggregate of the Revolving
Commitments then in effect.  Swing Line
Loans shall be made and maintained as Base Rate Loans and may be repaid and
reborrowed in accordance with the provisions hereof prior to the Swing Line
Termination Date.  Swing Line Loans may
be made notwithstanding the fact that such Swing Line Loans, when aggregated
with the Swing Line Lender’s other Revolving Outstandings, exceeds its
Revolving Commitment.  The proceeds of a
Swing Line Borrowing may not be used, in whole or in part, to refund any prior
Swing Line Borrowing.

(ii)           The principal amount of all Swing
Line Loans shall be due and payable on the earliest of (A) the maturity date
agreed to by the Swing Line Lender and the Borrower with respect to such Swing
Line Loan (which maturity date shall not be more than seven Business Days from
the date of advance thereof), (B) at the request of the Swing Line Lender, the
last day of the current calendar quarter, (C) the Swing Line Termination Date,
(D) the occurrence of any proceeding with respect to the Borrower under any
Debtor Relief Law or (E) the acceleration of any Loan or the termination of the
Revolving Commitments pursuant to Section 8.02.

(iii)          With respect to any Swing Line Loans
that have not been voluntarily prepaid by the Borrower or paid by the Borrower
when due under clause (ii) above, the Swing Line Lender (by request to
the Administrative Agent) or the Administrative Agent at any time may, and
shall at any time Swing Line Loans in an amount of $1,000,000 or more shall
have been outstanding for more than seven days, on one Business Day’s notice,
require each Revolving Lender, including the Swing Line Lender, and each such
Lender hereby agrees, subject to the provisions of this Section 2.01(c),
to make a Revolving Loan (which shall be initially funded as a Base Rate Loan)
in an amount equal to such Lender’s Revolving Commitment Percentage of the
amount of the Swing Line Loans (the “Refunded Swing Line Loans”)
outstanding on the date notice is given.

(iv)          In the case of Revolving Loans made by
Lenders other than the Swing Line Lender under clause (iii) above, each
such Revolving Lender shall make the amount of its Revolving Loan available to
the Administrative Agent, in same day funds, at the Administrative Agent’s
Office, not later than 1:00 P.M. on the Business Day next succeeding the date
such notice is given.  The proceeds of
such Revolving Loans shall be immediately delivered to the Swing Line Lender
(and not to the Borrower) and applied to repay the Refunded Swing Line Loans.  On the day such Revolving Loans are made, the
Swing Line Lender’s Revolving Commitment Percentage of the Refunded Swing Line
Loans shall be deemed to be paid with the proceeds of a Revolving Loan made by
the Swing Line Lender and such portion of the Swing Line Loans deemed to be so
paid shall no longer be outstanding as Swing Line Loans and shall instead be
outstanding as Revolving Loans.  The
Borrower authorizes the Administrative Agent and the Swing Line Lender to
charge the Borrower’s account with the Administrative Agent (up to the amount
available in such account) in order to pay immediately to the Swing Line Lender
the amount of such Refunded Swing Line Loans to the extent amounts received
from the Revolving Lenders, including amounts deemed to be received from the
Swing Line Lender, are not sufficient to repay in full such Refunded Swing Line
Loans.  If any portion of any such amount
paid (or deemed to be paid) to the Swing Line Lender should be recovered by or
on behalf of the Borrower from the Swing Line Lender in bankruptcy, by
assignment for the benefit of creditors or otherwise, the loss of the amount so
recovered shall be ratably shared among all Revolving Lenders in the manner
contemplated by Section 2.13.

(v)           A copy of each notice given by the
Swing Line Lender pursuant to this Section 2.01(c) shall be promptly
delivered by the Swing Line Lender to the Administrative Agent and the
Borrower.  Upon the making of a Revolving
Loan by a Revolving Lender pursuant 

 43
 

 

to this Section 2.01(c), the amount so
funded shall no longer be owed in respect of its Participation Interest in the
related Refunded Swing Line Loans.

(vi)          If as a result of any proceeding under
any Debtor Relief Law, Revolving Loans are not made pursuant to this Section
2.01(c) sufficient to repay any amounts owed to the Swing Line Lender as a
result of a nonpayment of outstanding Swing Line Loans, each Revolving Lender
agrees to purchase, and shall be deemed to have purchased, a participation in
such outstanding Swing Line Loans in an amount equal to its Revolving
Commitment Percentage of the unpaid amount together with accrued interest
thereon.  Upon one Business Day’s notice
from the Swing Line Lender, each Revolving Lender shall deliver to the Swing
Line Lender an amount equal to its respective Participation Interest in such
Swing Line Loans in same day funds at the office of the Swing Line Lender
specified or referred to in Section 10.02.  In order to evidence such Participation
Interest each Revolving Lender agrees to enter into a participation agreement
at the request of the Swing Line Lender in form and substance reasonably
satisfactory to all parties.  In the
event any Revolving Lender fails to make available to the Swing Line Lender the
amount of such Revolving Lender’s Participation Interest as provided in this Section
2.01(c)(vi), the Swing Line Lender shall be entitled to recover such amount
on demand from such Revolving Lender together with interest at the customary
rate set by the Swing Line Lender for correction of errors among banks in New
York City for one Business Day and thereafter at the Base Rate plus the then
Applicable Margin for Base Rate Loans.

(vii)         Each Revolving Lender’s obligation to
make Revolving Loans pursuant to clause (iv) above and to purchase
Participation Interests in outstanding Swing Line Loans pursuant to clause
(vi) above shall be absolute and unconditional and shall not be affected by
any circumstance, including (without limitation) (i) any set-off, counterclaim,
recoupment, defense or other right which such Revolving Lender or any other
Person may have against the Swing Line Lender, the Borrower, Holdings or any
other Loan Party, (ii) the occurrence or continuance of a Default or an Event
of Default or the termination or reduction in the amount of the Revolving
Commitments after any such Swing Line Loans were made, (iii) any adverse change
in the condition (financial or otherwise) of the Borrower or any other Person,
(iv) any breach of this Agreement or any other Loan Document by the Borrower or
any other Lender, (v) whether any condition specified in Article IV is
then satisfied or (vi) any other circumstance, happening or event whatsoever,
whether or not similar to any of the forgoing. 
If such Lender does not pay such amount forthwith upon the Swing Line
Lender’s demand therefor, and until such time as such Lender makes the required
payment, the Swing Line Lender shall be deemed to continue to have outstanding
Swing Line Loans in the amount of such unpaid Participation Interest for all
purposes of the Loan Documents other than those provisions requiring the other
Lenders to purchase a participation therein. 
Further, such Lender shall be deemed to have assigned any and all
payments made of principal and interest on its Loans, and any other amounts due
to it hereunder to the Swing Line Lender to fund Swing Line Loans in the amount
of the Participation Interest in Swing Line Loans that such Lender failed to
purchase pursuant to this Section 2.01(c)(vi) until such amount has been
purchased (as a result of such assignment or otherwise).

Section 2.02  Notice of
Borrowings.

(a)           Borrowings Other Than Swing Line Loans.  Except in the case of Swing Line Loans and
L/C Borrowings, the Borrower shall give the Administrative Agent a Notice of
Borrowing not later than 1:00 P.M. on (i) the Business Day immediately preceding
each Base Rate Borrowing and (ii) the third Business Day before each Eurodollar
Borrowing (unless the Borrower wishes to request an Interest Period for such
Borrowing other than one, two, three or six months in duration as provided in
the 

 44
 

 

definition of “Interest
Period”, in which case on the fourth Business Day before each such
Eurodollar Borrowing), specifying:

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

(ii)           the aggregate amount of such
Borrowing;

(iii)          the Class and initial Type of the
Loans comprising such Borrowing; and

(iv)          in the case of a Eurodollar Borrowing,
the duration of the initial Interest Period applicable thereto, subject to the
provisions of the definition of Interest Period and to Section 2.06(a);
and

(v)           the location (which must be in the
United States) and number of the Borrower’s account to which funds are to be
disbursed, which shall comply with the requirements of Section 2.03.

If the duration of the initial Interest Period is not specified with
respect to any requested Eurodollar Borrowing, then the Borrower shall be
deemed to have selected an initial Interest Period of one month, subject to the
provisions of the definition of Interest Period and to Section 2.06(a).

(b)           Swing Line Borrowings.  The Borrower shall request a Swing Line Loan
by written notice (or telephone notice promptly confirmed in writing)
substantially in the form of Exhibit A-4 hereto (a “Swing Line Loan
Request”) to the Swing Line Lender and the Administrative Agent not later
than 1:30 P.M. on the Business Day of the requested Swing Line Loan.  Each such notice shall be irrevocable and
shall specify (i) that a Swing Line Loan is requested, (ii) the date of the
requested Swing Line Loan (which shall be a Business Day) and (iii) the
principal amount of the Swing Line Loan requested.  Each Swing Line Loan shall be made as a Base
Rate Loan and, subject to Section 2.01(c)(ii), shall have such maturity
date as agreed to by the Swing Line Lender and the Borrower upon receipt by the
Swing Line Lender of the Swing Line Loan Request from the Borrower.

(c)           L/C Borrowings.  Each L/C Borrowing shall be made as specified
in Section 2.05(e)(iv) without the necessity of a Notice of Borrowing.

Section 2.03  Notice to
Lenders; Funding of Loans.

(a)           Notice to Lenders.  If the Borrower has requested an Interest
Period of nine or twelve months or less than one month in duration, the
Administrative Agent shall give prompt notice of such request to the Lenders
having Commitments of the applicable Class and determine whether the requested
Interest Period is acceptable to all of them. 
Not later than 2:00 P.M. on the third Business Day before the requested
date of such a Eurodollar Borrowing, the Administrative Agent shall notify the
Borrower (which notice may be by telephone) whether or not the requested
interest Period has been consented to by all the Lenders.  Upon receipt of a Notice of Borrowing, the
Administrative Agent shall promptly notify each Lender of such Lender’s ratable
share (if any) of the Borrowing referred to therein, and such Notice of
Borrowing shall not thereafter be revocable by the Borrower.

(b)           Funding of Loans.

(i)            Not later than 1:00 P.M. on the date
of each Borrowing (other than a Swing Line Borrowing and a L/C Borrowing), each
Lender participating therein shall make available its share of such Borrowing,
in Federal or other immediately available funds, to the 

 45
 

 

Administrative Agent at the Administrative
Agent’s Office.  Unless the
Administrative Agent determines that any applicable condition specified in Article
IV has not been satisfied, the Administrative Agent shall make the funds so
received available to the Borrower in like funds as received by the
Administrative Agent either by (i) crediting the account of the Borrower on the
books of JPMCB with the amount of such funds or (ii) in each case in accordance
with instructions provided to (and reasonably acceptable to) the Administrative
Agent, wire transfer of such funds to such other account as may be specified
for such purpose from time to time by the Borrower to the Administrative Agent
or as may have been otherwise specified by the Borrower in the applicable
Notice of Borrowing or, if a Borrowing shall not occur on such date because any
condition precedent herein shall not have been met, promptly return the amounts
received from the Lenders in like funds, without interest.

(ii)           Not later than 3:00 P.M. on the date
of each Swing Line Borrowing, the Swing Line Lender shall, unless the
Administrative Agent shall have notified the Swing Line Lender that any
applicable condition specified in Article IV has not been satisfied,
make available the amount of such Swing Line Borrowing, in Federal or other
immediately available funds, to the Borrower at the Swing Line Lender’s address
referred to in Section 10.02.

(iii)          Not later than 1:00 P.M. on the date
of each L/C Borrowing, each Revolving Lender shall make available its share of
such Borrowing, in Federal or other immediately available funds, to the
Administrative Agent at the Administrative Agent’s Office.  Unless the Administrative Agent determines
that any applicable condition specified in Article IV has not been
satisfied (other than the delivery of a Notice of Borrowing), the
Administrative Agent shall remit the funds so received to the L/C Issuer which
has issued Letters of Credit having outstanding Unreimbursed Amounts as
contemplated by Section 2.05(e)(v).

(c)           Funding by the Administrative Agent in Anticipation
of Amounts Due from the Lenders. 
Unless the Administrative Agent shall have received notice from a Lender
prior to the date of any Borrowing that such Lender will not make available to
the Administrative Agent such Lender’s share of such Borrowing, the
Administrative Agent may assume that such Lender has made such share available
to the Administrative Agent on the date of such Borrowing in accordance with subsection
(b) of this Section 2.03, and the Administrative Agent may, in
reliance upon such assumption, make available to the Borrower on such date a
corresponding amount.  If and to the extent
that such Lender shall not have so made such share available to the
Administrative Agent, such Lender and the 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 Borrower until the date such amount is repaid to the
Administrative Agent at (i) a rate per annum equal to the higher of the Federal
Funds Rate and the interest rate applicable thereto pursuant to Section 2.06,
in the case of the Borrower, and (ii) the Federal Funds Rate, in the case of
such Lender.  If such Lender shall repay
to the Administrative Agent such corresponding amount, such amount so repaid
shall constitute such Lender’s Loan included in such Borrowing for purposes of
this Agreement.

(d)           Obligations of Lenders Several.  The obligations of the Lenders hereunder to
make Loans and to purchase Participation Interests in Letters of Credit and
Swing Line Loans are several and not joint. 
The failure of any Lender to make a Loan required to be made by it as
part of any Borrowing hereunder or to fund and Participation Interest shall not
relieve any other Lender of its obligation, if any, hereunder to make any Loan
on the date of such Borrowing or fund any such Participation Interest, but no
Lender shall be responsible for the failure of any other Lender to make the
Loan to be made by such other Lender on such date of Borrowing or fund its
Participation Interest.

 46

 

(e)           Failed Loans.  If any Lender shall fail to make any Loan (a “Failed
Loan”) which such Lender is otherwise obligated hereunder to make to the
Borrower on the date of Borrowing thereof, and the Administrative Agent shall
not have received notice from the Borrower or such Lender that any condition
precedent to the making of the Failed Loan has not been satisfied, then, until
such Lender shall have made or be deemed to have made (pursuant to the last
sentence of this subsection (e)) the Failed Loan in full or the
Administrative Agent shall have received notice from the Borrower or such
Lender that any condition precedent to the making of the Failed Loan was not
satisfied at the time the Failed Loan was to have been made, whenever the
Administrative Agent shall receive any amount from the Borrower for the account
of such Lender, (i) the amount so received (up to the amount of such Failed
Loan) will, upon receipt by the Administrative Agent, be deemed to have been
paid to the Lender in satisfaction of the obligation for which paid, without
actual disbursement of such amount to the Lender, (ii) the Lender will be
deemed to have made the same amount available to the Administrative Agent for
disbursement as a Loan to the Borrower (up to the amount of such Failed Loan)
and (iii) the Administrative Agent will disburse such amount (up to the amount
of the Failed Loan) to the Borrower or, if the Administrative Agent has
previously made such amount available to the Borrower on behalf of such Lender
pursuant to the provisions hereof, reimburse itself (up to the amount of the
amount made available to the Borrower); provided, however, that
the Administrative Agent shall have no obligation to disburse any such amount
to the Borrower or otherwise apply it or deem it applied as provided herein
unless the Administrative Agent shall have determined in its sole discretion
that to so disburse such amount will not violate any Law, rule, regulation or
requirement applicable to the Administrative Agent.  Upon any such disbursement by the
Administrative Agent, such Lender shall be deemed to have made a Base Rate Loan
of the same Class as the Failed Loan to the Borrower in satisfaction, to the
extent thereof, of such Lender’s obligation to make the Failed Loan.

Section 2.04 
Evidence of Loans.

(a)           Lender Accounts.  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.

(b)           Administrative Agent Records.  The Administrative Agent shall maintain
accounts in which it will record (i) the amount of each Loan made hereunder,
the Class and Type of each Loan made and the Interest Period, if any,
applicable thereto, (ii) the amount of any principal or interest due and
payable or to become due and payable from the Borrower to each Lender hereunder
and (iii) the amount of any sum received by the Administrative Agent hereunder
from the Borrower and each Lender’s share thereof.

(c)           Evidence of Indebtedness.  The entries made in the accounts maintained
pursuant to subsections (a) and (b) of this Section 2.04
shall be prima facie evidence absent demonstrable error 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 obligations of
the Borrower to repay the Loans in accordance with their terms.

(d)           Notes. 
Notwithstanding any other provision of this Agreement, if any Lender
shall request and receive a Note or Notes as provided in Section 10.07
or otherwise, then the Loans of such Lender shall be evidenced by a single
Revolving Note or Term B Note, as applicable, in each case, substantially in
the form of Exhibit B-1 or B-2, as applicable, payable to the
order of such Lender for the account of its Applicable Lending Office in an
amount equal to the aggregate unpaid principal amount of such Lender’s
Revolving Loans or Term B Loans , as applicable.  If requested by the Swing Line Lender, the
Swing Line Loans shall be evidenced by a single Swing Line Note, substantially
in the form of 

 47
 

 

Exhibit B-3,
payable to the order of the Swing Line Lender in an amount equal to the
aggregate unpaid principal amount of the Swing Line Loans.

(e)           Note Endorsements.  Each Lender having one or more Notes shall
record the date, amount, Class and Type of each Loan made by it and the date
and amount of each payment of principal made by the Borrower with respect
thereto, and may, if such Lender so elects in connection with any permitted
transfer or enforcement of any Note, endorse on the reverse side or on the schedule,
if any, forming a part thereof appropriate notations to evidence the foregoing
information with respect to each outstanding Loan evidenced thereby; provided
that the failure of any Lender to make any such recordation or endorsement
shall not affect the obligations of the Borrower hereunder or under any such
Note.  Each Lender is hereby irrevocably
authorized by the Borrower so to endorse each of its Notes and to attach to and
make a part of each of its Notes a continuation of any such schedule as and when
required.

Section 2.05  Letters of
Credit.

(a)           Issuance of Letters of Credit.  Subject to the terms and conditions set forth
herein, (i) each L/C Issuer agrees, in reliance upon the agreements of the
other Revolving Lenders set forth in this Section 2.05, (A) from time to
time on any Business Day during the period from the Closing Date until the
Letter of Credit Expiration Date, to issue Letters of Credit for the account,
and upon the request, of the Borrower or one or more of its Subsidiaries and in
support of (x) trade obligations of the Borrower and/or its Subsidiaries, which
shall be payable at sight in Dollars (each such letter of credit, a “Trade
Letter of Credit” and, collectively, the “Trade Letters of Credit”)
and (y) such other obligations of the Borrower incurred for its general
corporate purposes (each such letter of credit, a “Standby Letter of Credit”
and, collectively, the “Standby Letters of Credit”), and to amend or
extend Letters of Credit
previously issued by it, in accordance with subsection (c) below, and
(B) to honor drawings under its Letters of Credit, and (ii) each Revolving
Lender severally agrees to participate in Letters of Credit issued for the
account of the Borrower or its Subsidiaries and any drawing thereunder in
accordance with the provisions of subsection (e) below; provided
that, immediately after each Letter of Credit is issued, (i) the aggregate
amount of the L/C Obligations shall not exceed the L/C Sublimit, (ii) the
Revolving Outstandings shall not exceed the Revolving Committed Amount and
(iii) with respect to each individual Revolving Lender, the aggregate
outstanding principal amount of the Revolving Lender’s Revolving Loans plus its
Participation Interests in outstanding L/C Obligations plus its (other than the
Swing Line Lender’s) Participation Interests in outstanding Swing Line Loans
shall not exceed such Revolving Lender’s Revolving Commitment Percentage of the
Revolving Committed Amount.  Each request
by the Borrower or a Subsidiary for the issuance or amendment of a Letter of
Credit shall be deemed to be a representation by the Borrower and such
Subsidiary that the issuance or amendment of such Letter of Credit complies
with the conditions set forth in the proviso to the preceding sentence.  Within the foregoing limits, and subject to
the terms and conditions hereof, the Borrower’s ability to obtain Letters of
Credit shall be fully revolving, and accordingly the Borrower may, during the
period specified in clause (i)(A) above, obtain Letters of Credit to
replace Letters of Credit that have expired or that have been drawn upon and
reimbursed.

(b)           Certain Limitations on Issuances of Letters of Credit.

(i)            No L/C Issuer shall issue any Letter
of Credit, if (A) subject to subsection (c) below with respect to
Auto-Extension Letters of Credit, the expiry date of such requested Letter of
Credit would occur more than twelve months (or 24 months for Letters of Credit
having an aggregate stated or face amount not exceeding $10,000,000 at any time
outstanding) after the date of issuance or last extension, unless the Required
Revolving Lenders have approved such expiry date, (B) the expiry date of such
requested letter of Credit would

 48
 

 

occur after the Letter of Credit Expiration
Date, unless all the Lenders have approved such expiry date or (C) such Letter
of Credit is to be used for any purpose other than for its general corporate
purposes unless the Required Revolving Lenders have consented thereto.

(ii)           No L/C Issuer shall be under any
obligation to issue any Letter of Credit if: (A) any order, judgment or decree
of any Governmental Authority shall by its terms purport to enjoin or restrain
the L/C Issuer from issuing such Letter of Credit, or any Law applicable to
such L/C Issuer or any request or directive (whether or not having a force of
Law) from any Governmental Authority with jurisdiction over such L/C Issuer
shall prohibit, or request that such L/C Issuer refrain from, the issuance of
letters of credit generally or such Letter of Credit in particular or shall
impose upon such L/C Issuer with respect to such Letter of Credit any
restriction, reserve or capital requirement (for which such L/C Issuer is not
otherwise compensated hereunder) not in effect on the Closing Date, or shall
impose upon such L/C Issuer any unreimbursed loss, cost or expense which was
not applicable on the Closing Date and which such L/C Issuer in good faith
deems material to it; (B) the issuance of such Letter of Credit shall violate
any Laws or one ore more policies of such L/C Issuer; (C) except as otherwise
agreed by the Administrative Agent and the applicable L/C issuer, such Letter
of Credit is in an initial face amount less than $100,000, in the case of a
Trade Letter of Credit, or $250,000, in the case of a Standby Letter of Credit;
(D) such Letter of Credit is to be denominated in a currency other than
Dollars; or (E) a default of any Revolving Lender’s obligations to fund under subsection
(e)(iv) or (vi) below exists or any Revolving Lender is at such time
a Defaulting Lender hereunder, unless the L/C Issuer has entered into
satisfactory arrangements with the Borrower or such Revolving Lender to
eliminate the L/C Issuer’s risk with respect to such Revolving Lender.

(iii)          No L/C issuer shall amend any Letter
of Credit if the L/C Issuer would not be permitted at such time to issue such
Letter of Credit in its amended form under the terms hereof.

(iv)          No L/C issuer shall be under any
obligation to amend any Letter of Credit if (A) the L/C Issuer would have no
obligation at such time to issue such Letter of Credit in its amended form
under the terms hereof, or (B) the beneficiary of such Letter of Credit does
not accept the proposed amendment to such Letter of Credit.

(c)           Procedures for Issuance and Amendment of Letters of
Credit; Auto-Extension Letters of Credit.

(i)            Each Letter of Credit shall be
issued or amended, as the case may be, upon the request of the Borrower
delivered to the applicable L/C Issuer (with a copy to the Administrative
Agent) substantially in the form of Exhibit A-3 hereto (a “Letter of
Credit Request”), appropriately completed and signed by a Responsible
Officer of the Borrower.  Such Letter of
Credit Request must be received by the L/C Issuer and the Administrative Agent
not later than 11:00 A.M. at least two Business Days (or such later date and
time as the Administrative Agent and the L/C issuer may agree in a particular
instance in their sole discretion) prior to the proposed issuance date or date
of amendment, as the case may be.  In the
case of a request for an initial issuance of a Letter of Credit, such Letter of
Credit Request shall specify in form and detail reasonably satisfactory to the
L/C Issuer:  (A) the proposed issuance
date of the requested Letter of Credit (which shall be a Business Day); (B) the
amount thereof; (C) the expiry date thereof; (D) the name and address of the
beneficiary thereof; (E) the documents to be presented by such beneficiary in
case of any drawing thereunder; (F) the full text of any certificate to be
presented by such beneficiary in case of any drawing thereunder; and (G) such
other matters as the L/C Issuer may require. 
In the case of a request for an amendment of 

 49
 

 

any outstanding Letter of Credit, such Letter
of Credit Request shall specify in form and detail satisfactory to the L/C Issuer:  (A) the Letter of Credit to be amended; (B)
the proposed date of amendment thereof (which shall be a Business Day); (C) the
nature of the proposed amendment; and (D) such other matters as the L/C Issuer
may require.  If requested by the
applicable L/C Issuer, the Borrower shall also submit a letter of credit
application on such L/C Issuer’s standard form in connection with any request
for the issuance or amendment of a Letter of Credit.  Additionally, the Borrower shall furnish to
the L/C Issuer and the Administrative Agent such other documents and
information pertaining to such requested Letter of Credit issuance or
amendment, including any L/C Documents, as the L/C Issuer or the Administrative
Agent may require.

(ii)           Promptly after receipt of any Letter
of Credit Request, the L/C Issuer will confirm with the Administrative Agent
(by telephone or in writing) that the Administrative Agent has received a copy
of such Letter of Credit Request from the Borrower and, if not, the L/C Issuer
will provide the Administrative Agent with a copy thereof.  Unless the L/C Issuer has received written
notice from any Revolving Lender, the Administrative Agent or any Loan Party,
at least one Business Day prior to the requested date of issuance or amendment
of the applicable Letter of Credit, that one or more applicable conditions
contained in Article IV shall not then be satisfied, then, subject to
the terms and conditions thereof, the L/C Issuer shall, on the requested date,
issue a Letter of Credit for the account of the Borrower (or the applicable
Subsidiary) or enter into the applicable amendment, as the case may be, in each
case in accordance with the L/C Issuer’s usual and customary business
practices.

(iii)          If the Borrower so requests in any
applicable Letter of Credit Request, the L/C Issuer may, in its sole and
absolute discretion, agree to issue a Letter of Credit that has automatic
extension provisions (each, an “Auto-Extension Letter of Credit”); provided
that any such Auto-Extension Letter of Credit must permit the L/C Issuer to
prevent any such extension at least once in each twelve-month period
(commencing with the date of issuance of such Letter of Credit) by giving prior
notice to the beneficiary thereof not later than a day (the “Non-Extension
Notice Date”) in each such twelve-month period to be agreed upon at the
time such Letter of Credit is issued. 
Unless otherwise directed by the L/C Issuer, the Borrower shall not be
required to make a specific request to the L/C Issuer for any such
extension.  Once an Auto-Extension Letter
of Credit has been issued, the Revolving Lenders shall be deemed to have
authorized (but may not require) the L/C Issuer to permit the extension of such
Letter of Credit at any time to a date not later than the Letter of Credit Expiration
Date; provided, however, that the L/C Issuer shall not permit any
such extension if (A) the L/C Issuer has determined that it would not be
permitted, or would have no obligation, at such time to issue such Letter of
Credit in its revised form (as extended) under the terms hereof (by reason of
the provisions of the provisions of subsection (b)(i) or (ii)
above or otherwise) or (B) it has received notice (which may be by telephone or
in writing) on or before the day that is five Business Days before the
Non-Extension Notice Date (x) from the Administrative Agent that the Required
Revolving Lenders have elected not to permit such extension or (y) from the
Administrative Agent, any Revolving Lender or any Loan Party that one or more
of the applicable conditions specified in Section 4.04 is not then
satisfied, and in each such case directing the L/C issuer not to permit such
extension.

(iv)          If any Letter of Credit contains
provisions providing for automatic reinstatement of the stated amount after any
drawing thereunder, (A) unless otherwise directed by the L/C issuer to permit
such reinstatement, and (B) the Administrative Agent and the Revolving Lenders
hereby authorize and direct the L/C issuer to permit such automatic
reinstatement, whether or not a Default then exists, unless the L/C Issuer has
received a notice (which may be by telephone or in writing) on or before the
date that is two Business Days before the reinstatement 

 50
 

 

date from the Administrative Agent, the
Required Revolving Lenders or any Loan Party that one or more of the applicable
conditions specified in Section 4.04 is not then satisfied and directing
the L/C issuer to cease permitting such automatic reinstatement of such Letter
of Credit.

(v)           Promptly after its delivery of any
Letter of Credit or any amendment to a Letter of Credit to an advising bank
with respect thereto or to the beneficiary thereof, the L/C Issuer will also
deliver to the Borrower and the Administrative Agent a true and complete copy
of such Letter of Credit or amendment.

(d)           Purchase and Sale of Letter of Credit Participations.  Immediately upon the issuance by an L/C
Issuer of an Letter of Credit, such L/C Issuer shall be deemed, without further
action by any party hereto, to have sold to each Revolving Lender, and each Revolving
Lender shall be deemed, without further action by any party hereto, to have
purchased from such L/C Issuer, without recourse or warranty, an undivided
participation interest in such Letter of Credit and the related L/C Obligations
in the proportion its Revolving Commitment Percentage bears to the Revolving
Committed Amount (although any fronting fee payable under Section 2.11
shall be payable directly to the Administrative Agent for the account of the
applicable L/C Issuer, and the Lenders (other than such L/C Issuer) shall have
no right to receive any portion of any such fronting fee) and any security
therefor or guaranty pertaining thereto. 
Upon any change in the Revolving Commitments pursuant to Section
2.10(a) or Section 10.07, there shall be an automatic adjustment to
the Participation Interests in all outstanding Letters of Credit and all L/C
Obligations to reflect the adjusted Revolving Commitments of the assigning and
assignee Lenders or of all Lenders having Revolving Commitments, as the case
may be.

(e)           Drawings and Reimbursements; Funding of
Participations.

(i)            Upon receipt from the beneficiary of
any Letter of Credit of any notice of a drawing under such Letter of Credit,
the applicable L/C Issuer shall notify the Borrower and the Administrative
Agent thereof and shall determine in accordance with the terms of such Letter
of Credit whether such drawing should be honored.  If the L/C Issuer determines that any such
drawing shall be honored, such L/C Issuer shall make available to such beneficiary
in accordance with the terms of such Letter of Credit the amount of the drawing
and shall notify the Borrower and the Administrative Agent as to the amount to
be paid as a result of such drawing and the payment date (each such date, an “Honor
Date”).

(ii)           The Borrower shall be irrevocably and
unconditionally obligated forthwith to reimburse each L/C Issuer through the
Administrative Agent for any amounts paid by such L/C Issuer upon any drawing
under any Letter of Credit, together with any and all reasonable charges and
expenses which the L/C Issuer may pay or incur relative to such drawing.  Such reimbursement payment shall be due and
payable (i) at or before 1:00 P.M. on the date the Honor Date if the L/C Issuer
notifies the Borrower of such drawing at or before 12:00 P.M. on the Honor Date
or (ii) at or before 1:00 P.M. on the next succeeding Business Day if such
notice if given after 12:00 P.M. on the Honor Date; provided that no
payment otherwise required by this sentence to be made by the Borrower at or
before 1:00 P.M. on any day shall be overdue hereunder if arrangements for such
payment by virtue of a Borrowing of Revolving Loans or a Swing Line Loan or
other arrangements satisfactory to the applicable L/C Issuer, in its reasonable
discretion, shall have been made by the Borrower at or before 1:00 P.M. on such
day and such payment is actually made at or before 3:00 P.M. on such day.  In addition, the Borrower agrees to pay to
the L/C Issuer interest, payable on demand, on any and all amounts not paid by
the Borrower to the L/C Issuer when due under this subsection (e)(ii),
for each day from and including the date when such amount becomes due to but
excluding the date such amount is paid in full, whether before or after
judgment, at a rate per annum equal to the sum of 2% plus the rate 

 51
 

 

applicable to Revolving Base Rate Loans for
such day.  Each reimbursement and other
payment to be made by the Borrower pursuant to this clause (ii) shall be
made to the L/C Issuer in Federal or other funds immediately available to it at
its address referred to in Section 10.02.

(iii)          Subject to the satisfaction of all
applicable conditions set forth in Article IV, the Borrower may, at its
option, utilize the Swing Line Commitment or the Revolving Commitments, or make
other arrangements for payment satisfactory to the L/C Issuer, for the
reimbursement of all L/C Disbursements as required by clause (ii) above.

(iv)          With respect to any L/C Disbursement
that have not been reimbursed by the Borrower when due under clauses (ii)
and (iii) above (an “Unreimbursed Amount”), the Administrative
Agent shall promptly notify each Revolving Lender of the Honor Date, the amount
of the Unreimbursed Amount and the amount of such Revolving Lender’s pro-rata
share thereof such Revolving Lender’s pro-rata share of such unreimbursed L/C
Disbursement (determined by the proportion its Revolving Commitment Percentage
bears to the aggregate Revolving Committed Amount).  In such event, the Borrower shall be deemed
to have requested a Borrowing (a “L/C Borrowing”) of Revolving Base Rate
Loans to be disbursed on the Honor Date in an aggregate amount equal to the
Unreimbursed Amount, without regard to the minimum and multiples specified in Section
2.01(a), but subject to the amount of the unutilized portion of the
Revolving Commitments and the conditions set forth in Section 4.04
(other than the delivery of a Notice of Borrowing), and each such Revolving
Lender hereby agrees to make a Revolving Loan (which shall be initially funded
as a Base Rate Loan) in an amount equal to such Lender’s Revolving Commitment
Percentage of the Unreimbursed Amount outstanding on the date notice is
given.  Any such notice given by a L/C
Issuer or the Administrative Agent given pursuant to this clause (iv)
may be given by telephone if immediately confirmed in writing; provided that
the lack of such an immediate confirmation shall not affect the conclusiveness
or binding effect of such notice.

(v)           Each Revolving Lender (including any
Revolving Lender acting as L/C Issuer in respect of any Unreimbursed Amount)
shall, upon any notice from the Administrative Agent pursuant to clause (iv)
above, make the amount of its Revolving Loan available to the Administrative
Agent, in Dollars in Federal or other immediately available funds same day
funds, at the Administrative Agent’s Office, not later than 1:00 P.M. on the
Business Day specified in such notice, whereupon, subject to clause (vi)
below, each Revolving Lender that so makes funds available shall be deemed to
have made a Revolving Base Rate Loan to the Borrower in such amount.  The Administrative Agent shall remit the
funds so received to the applicable L/C Issuer in satisfaction of the
Unreimbursed Amount to the extent of such funds.

(vi)          With respect to any Unreimbursed Amount
that is not fully refinanced by a L/C Borrowing pursuant to clauses (iv)
and (v) above because the conditions set forth in Section 4.04
cannot be satisfied or for any other reason, the L/C Issuer shall promptly
notify the Administrative Agent, and the Administrative Agent shall promptly
notify each Revolving Lender (other than the relevant L/C Issuer), and each
such Revolving Lender shall promptly and unconditionally pay to the
Administrative Agent, for the account of such L/C Issuer, such Revolving Lender’s
pro-rata share of such Unreimbursed Amount (determined by the proportion its
Revolving Commitment Percentage bears to the aggregate Revolving Committed
Amount) in Dollars in Federal or other immediately available funds.  Such payment from the Revolving Lenders shall
be due (i) at or before 1:00 P.M. on the date the Administrative Agent so
notifies a Revolving Lender, if such notice is given at or before 10:00 A.M. on
such date or (ii) at or before 10:00 A.M. on the next succeeding Business Day,
together with interest on such amount for each day from and including the date
of such drawing to but excluding the day such payment is due 

 52
 

 

from such Revolving Lender at the Federal
Funds Rate for such day (which funds the Administrative Agent shall promptly
remit to the applicable L/C Issuer). 
Each payment by a Revolving Lender to the Administrative Agent for the
account of an L/C Issuer in respect of an Unreimbursed Amount shall constitute
a payment in respect of its Participation Interest in related Letter of Credit
purchased pursuant to subsection (d) above.  The failure of any Revolving Lender to make
available to the Administrative Agent for the account of an L/C Issuer its
pro-rata share of any Unreimbursed Amount shall not relieve any other Revolving
Lender of its obligation hereunder to make available to the Administrative
Agent for the account of such L/C Issuer its pro-rata share of any payment made
under any Letter of Credit on the date required, as specified above, but no
such Lender shall be responsible for the failure of any other Lender to make
available to the Administrative Agent for the account of the L/C Issuer such
other Lender’s pro-rata share of any such payment.  Upon payment in full of all amounts payable
by a Lender under this clause (vi), such Lender shall be subrogated to
the rights of the L/C Issuer against the Borrower to the extent of such Lender’s
pro-rata share of the related L/C Obligation so paid (including interest
accrued thereon).

(vii)         Each Revolving Lender’s obligation to
make Revolving Loans pursuant to clause (iv) above and to make payments
in respect of its Participation Interests in Unreimbursed Amounts pursuant to clause
(vi) above shall be absolute and unconditional and shall not be affected by
any circumstance, including:  (A) any
set-off, counterclaim, recoupment, defense or other right which such Lender may
have against the L/C Issuer, the Borrower or any other Person for any reason
whatsoever; (B) the occurrence or continuance of a Default; or (C) any other
occurrence, event or condition, whether or not similar to any of the foregoing;
provided, however, that each Revolving Lender’s obligation to
make Revolving Loans as a part of a L/C Borrowing pursuant to clause (iv)
above is subject to the conditions set forth in Section 4.04 (other than
delivery by the Borrower of a Notice of Borrowing).  No such making by a Revolving Lender of a
Revolving Loan or a payment by a Revolving Lender of an amount in respect of
its Participation Interest in Unreimbursed Amounts shall relieve or otherwise
impair the obligation of the Borrower to reimburse the L/C issuer for the
amount of any payment made by the L/C Issuer under any Letter of Credit,
together with interest as provided herein.

(viii)        If any Revolving Lender fails to make
available to the Administrative Agent for the account of an L/C Issuer any
amount required to be paid by such Revolving Lender pursuant to the foregoing
provisions of this subsection (e) by the time specified therefor, the
applicable L/C Issuer shall be entitled to recover from such Revolving Lender
(acting through the Administrative Agent), on demand, such amount with interest
thereon for the period from the date such payment is required to the date on
which such payment is immediately available to the applicable L/C Issuer at a
rate per annum equal to the Federal Funds Rate for such day.  Any payment made by any Lender after 3:00
P.M. on any Business Day shall be deemed for purposes of the preceding sentence
to have been made on the next succeeding Business Day  A certificate of the applicable L/C Issuer
submitted to any Revolving Lender (through the Administrative Agent) with
respect to any amounts owing under this clause (viii) shall be
conclusive absent manifest error.

(f)            Repayment of Funded Participations in Respect of
Drawn Letters of Credit.

(i)            Whenever the Administrative Agent
receives a payment of an L/C Obligation as to which the Administrative Agent
has received for the account of an L/C Issuer any payments from the Revolving
Lenders pursuant to subsection (e) above (whether directly from the
Borrower or otherwise, including proceeds of cash collateral applied thereto by
the Administrative Agent), the Administrative Agent shall promptly pay to each
Revolving Lender 

 53
 

 

which has paid its pro-rata share thereof an
amount equal to such Lender’s pro-rata share of the amount thereof
(appropriately adjusted, in the case of interest payments, to reflect the
period of time during which the payments from the Revolving Lenders were
received) in the same funds as those received by the Administrative Agent.

(ii)           If any payment received by the
Administrative Agent for the account of an L/C issuer pursuant to clause (i)
above is required to be returned under any of the circumstances  described in Section 10.06 (including
pursuant to any settlement entered into by the L/C issuer in its discretion),
each Revolving Lender shall pay to the Administrative Agent for the account of
such L/C Issuer its pro-rata share thereof (determined by the proportion its
Revolving Commitment Percentage bears to the aggregate Revolving Committed
Amount) on demand of the Administrative Agent, plus interest thereon from the
date of such demand to the date such amount is returned by such Revolving
Lender, at a rate per annum equal to the Federal Funds Rate for such day.

(g)           Obligations Absolute.  The obligations of the Borrower under Section
2.05(e) above shall be absolute, unconditional and irrevocable, and shall
be performed strictly in accordance with the terms of this Agreement, under all
circumstances whatsoever, including, without limitation, the following
circumstances:

(i)            any lack of validity or
enforceability of such Letter of Credit, this Agreement or any other Loan
Document;

(ii)           any amendment or waiver of or any
consent to departure from all or any of the provisions of this Agreement, any
Letter of Credit or any other Loan Document;

(iii)          the use which may be made of the
Letter of Credit by, or any acts or omission of, a beneficiary of a Letter of
Credit (or any Person for whom the beneficiary may be acting);

(iv)          the existence of any claim,
counterclaim, set-off, defense or other rights that the Borrower or any
Subsidiary may have at any time against a beneficiary or any transferee of a
Letter of Credit (or any Person for whom the beneficiary or transferee may be
acting), any L/C Issuer or any other Person, whether in connection with this
Agreement or any Letter of Credit or any document related hereto or thereto or
any unrelated transaction;

(v)           any draft, demand, certificate,
statement or any 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 whatsoever, or any loss or
delay in the transmission or otherwise of any document required in order to
make a drawing under such Letter of Credit;

(vi)          any payment by the L/C Issuer under a
Letter of Credit against presentation of a draft or certificate that does not
strictly comply with the terms of such Letter of Credit;

(vii)         any payment made by the L/C Issuer
under such Letter of Credit to any Person purporting to be a trustee in
bankruptcy, debtor-in-possession, assignee for the benefit of creditors,
liquidator, receiver or other representative of or successor to any beneficiary
or any transferee of such Letter of Credit, including any arising in connection
with any proceeding under any Debtor Relief Law; or

 54
 

 

 

(viii)        any other act or omission to act or
delay of any kind by any L/C Issuer or any other Person or any other event or
circumstance whatsoever that might, but for the provisions of this subsection
(vii), constitute a defense to, or a legal or equitable discharge of, the
Borrower’s or any Subsidiary’s obligations hereunder.

The
Borrower shall promptly examine a copy of each Letter of Credit and each
amendment thereto that is delivered to it and, in the event of any claim of
noncompliance with the Borrower’s instructions or other irregularity, the
Borrower will immediately notify the L/C Issuer.  The Borrower shall be conclusively deemed to
have waived any such claim against the L/C Issuer and its correspondents unless
such notice is given as aforesaid.

(h)           Role of L/C Issuers; Reliance.  Each Revolving Lender and the Borrower agree
that, in determining whether to pay under any Letter of Credit, the relevant
L/C Issuer shall not have any responsibility to obtain any document (other than
any sight draft, certificates and documents expressly required by the Letter of
Credit) or to ascertain or inquire as to the validity or accuracy of any such
document or the authority of the Person executing or delivering any such
document.  None of the L/C Issuer, any
Agent-Related Person nor any of the respective correspondents, participants or
assignees of the L/C Issuer shall be liable to any Lender for: (i) any action
taken or omitted in connection herewith at the request or with the approval of
the Lenders or the Required Lenders, as applicable; (ii) any action taken or
omitted in the absence of bad faith, gross negligence or willful misconduct; or
(iii) the due execution, effectiveness, validity or enforceability of any
document or instrument related to any Letter of Credit or Letter of Credit
Request.  The Borrower hereby assumes all
risks of the acts or omissions of any beneficiary or transferee with respect to
its use of any Letter of Credit; provided, however, that this
assumption is not intended to, and shall not, preclude the Borrower’s pursuing
such rights and remedies as it may have against the beneficiary or transferee
at law or under any other agreement. 
None of the L/C Issuer, any Agent-Related Person, nor any of the
respective correspondents, participants or assignees of the L/C Issuer, shall
be liable or responsible for any of the matters described in clauses (i)
through (viii) of subsection (g) of this Section 2.05; provided,
however, that anything in such clauses to the contrary notwithstanding,
the Borrower may have a claim against the L/C Issuer, and the L/C Issuer may be
liable to the Borrower, to the extent, but only to the extent, of any direct,
as opposed to consequential or exemplary, damages suffered by the Borrower
which the Borrower proves were caused by the L/C Issuer’s bad faith, willful
misconduct or gross negligence or the L/C Issuer’s willful failure to pay under
any Letter of Credit after the presentation to it by the beneficiary of a sight
draft and certificate(s) strictly complying with the terms and conditions of a
Letter of Credit.  In furtherance and not
in limitation of the foregoing, the L/C Issuer may accept documents that appear
on their face to be in order, without responsibility for further investigation,
regardless of any notice or information to the contrary, and the L/C Issuer
shall not be responsible for the validity or sufficiency of any instrument
transferring or assigning or purporting to transfer or assign a Letter of
Credit or the rights or benefits thereunder or proceeds thereof, in whole or in
part, which may prove to be invalid or ineffective for any reason.  Each L/C Issuer shall be entitled (but not
obligated) to rely, and shall be fully protected in relying, on the
representation and warranty by the Borrower set forth in the last sentence of Section
4.04 to establish whether the conditions specified in paragraphs (b)
and (c) of Section 4.04 are met in connection with any issuance
or extension of a Letter of Credit.  Each
L/C Issuer shall be entitled to rely, and shall be fully protected in relying,
upon advice and statements of legal counsel, independent accountants and other
experts selected by such L/C Issuer and upon any Letter of Credit, draft,
writing, resolution, notice, consent, certificate, affidavit, letter,
cablegram, telegram, telecopier, telex or teletype message, statement, order or
other document believed by it in good faith to be genuine and correct and to
have been signed, sent or made by the proper Person or Persons, and may accept
documents that appear on their face to be in order, without responsibility for
further investigation, regardless of any notice or information to the contrary
unless the beneficiary and the Borrower shall have notified such L/C Issuer
that such documents do not comply with the terms and conditions of the Letter
of Credit.  Each L/C Issuer shall be
fully 

 55
 

 

justified in
refusing to take any action requested of it under this Section 2.05 in
respect of any Letter of Credit unless it shall first have received such advice
or concurrence of the Required Revolving Lenders as it reasonably deems
appropriate or it shall first be indemnified to its reasonable satisfaction by
the Revolving Lenders against any and all liability and expense which may be
incurred by it by reason of taking or continuing to take, or omitting or
continuing to omit, any such action. 
Notwithstanding any other provision of this Section 2.05, each
L/C Issuer shall in all cases be fully protected in acting, or in refraining
from acting, under this Section 2.05 in respect of any Letter of Credit
in accordance with a request of the Required Revolving Lenders, and such
request and any action taken or failure to act pursuant hereto shall be binding
upon all Revolving Lenders and all future holders of participations in such
Letter of Credit.

(i)            Cash Collateral.  If the Borrower is required pursuant to the
terms of this Agreement or any other Loan Document to Cash Collateralize any
L/C Obligations, the Borrower shall deposit in an account (which may be the L/C
Cash Collateral Account under the Security Agreement) with the Collateral Agent
an amount in cash equal to 105% of such L/C Obligations.  Such deposit shall be held by the Collateral
Agent as collateral for the payment and performance of the L/C
Obligations.  The Collateral Agent shall
have exclusive dominion and control, including the exclusive right of
withdrawal, over such account.  The
Collateral Agent will, at the request of the Borrower, invest amounts deposited
in such account in Cash Equivalents; provided, however, that (i)
the Collateral Agent shall not be required to make any investment that, in its
sole judgment, would require or cause the Collateral Agent to be in, or would
result in any, violation of any Law, (ii) such Cash Equivalents shall be
subjected to a first priority perfected security interest in favor of the
Collateral Agent and (iii) if an Event of Default shall have occurred and be
continuing, the selection of such Cash Equivalents shall be in the sole
discretion of the Collateral Agent.  The
Borrower shall indemnify the Collateral Agent for any losses relating to such
investments in Cash Equivalents.  Other
than any interest or profits earned on such investments, 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 Collateral Agent to reimburse the L/C Issuers immediately for drawings
under the applicable Letters of Credit and, if the maturity of the Loans has
been accelerated, to satisfy the L/C Obligations.  If the Borrower is required to provide an
amount of cash collateral hereunder as a result of an Event of Default, such
amount (to the extent not applied as aforesaid) shall be returned to the
Borrower within three Business Days after all Events of Default have been cured
or waived.  If the Borrower is required
to provide an amount of cash collateral hereunder pursuant to Section
2.09(b)(i), such amount (to the extent not applied as aforesaid) shall be
returned to the Borrower upon demand; provided that, after giving effect
to such return, (i) the aggregate Revolving Outstandings would not exceed the
Revolving Committed Amount and (ii) no Default or Event of Default shall have
occurred and be continuing.  If the
Borrower is required to deposit an amount of cash collateral hereunder pursuant
to Section 2.09(b)(ii), (iii), (iv) or (v), interest or profits
thereon (to the extent not applied as aforesaid) shall be returned to the
Borrower after the full amount of such deposit has been applied by the
Collateral Agent to reimburse the L/C Issuer for drawings under Letters of
Credit.  The Borrower hereby pledges and
assigns to the Collateral Agent, for its benefit and the benefit of the L/C
Issuers and the Revolving Lenders, the cash collateral account established
hereunder (and all monies and investments held therein) to secure all L/C
Obligations and Revolving Loans.

(j)            Applicability of ISP98 and UCP.  Unless otherwise expressly agreed by the L/C
Issuer and the Borrower when a Letter of Credit is issued (including any such
agreement applicable to an Existing Letter of Credit), (i) the rules of the
ISP shall apply to each Standby Letter of Credit, and (ii) the rules of
the Uniform Customs and Practice for Documentary Credits, as most recently
published by the International Chamber of Commerce at the time of issuance
shall apply to each Trade Letter of Credit.

(k)           Conflict with L/C Documents.  In the event of any conflict between this
Agreement and any L/C Document, this Agreement shall govern.

 

 56

 

(l)            Letters of Credit Issued for Subsidiaries.  Notwithstanding that a Letter of Credit
issued or outstanding hereunder is in support of any obligations of, or is for
the account of, a Subsidiary, the Borrower shall be obligated to reimburse the
applicable L/C Issuer hereunder for any and all drawings under such Letter of
Credit.  The Borrower hereby acknowledges
that the issuance of Letters of Credit for the account of Subsidiaries inures
to the benefit of the Borrower, and that the Borrower’s business derives
substantial benefits from the businesses of such Subsidiaries.

(m)          Indemnification of L/C Issuers.

(i)            In addition to its other obligations
under this Agreement, the Borrower hereby agrees to protect, indemnify, pay and
save each L/C Issuer harmless from and against any and all claims, demands,
liabilities, damages, losses, costs, charges and expenses (including reasonable
Attorney Costs) that such L/C Issuer may incur or be subject to as a
consequence, direct or indirect, of (A) the issuance of any Letter of Credit or
(B) the failure of such L/C Issuer to honor a drawing under a Letter of Credit
as a result of any act or omission, whether rightful or wrongful, of any
present or future de jure or de facto government or Governmental Authority (all
such acts or omissions, herein called “Government Acts”); provided
that such indemnity shall not be available to the extent that such claims,
demands, liabilities, damages, losses, costs, charges and expenses are
determined by a court of competent jurisdiction by final and nonappealable
judgment to have resulted from the bad faith, gross negligence or willful
misconduct of such L/C Issuer.

(ii)           In furtherance and extension and not
in limitation of the specific provisions hereinabove set forth, any action
taken or omitted by an L/C Issuer, under or in connection with any Letter of
Credit or the related certificates, if taken or omitted in good faith, shall
not put the L/C Issuer under any resulting liability to the Borrower or any
other Loan Party.  It is the intention of
the parties that this Agreement shall be construed and applied to protect and
indemnify the L/C Issuers against any and all risks involved in the issuance of
any Letter of Credit, all of which risks are hereby assumed by the Loan
Parties, including, without limitation, any and all risks, whether rightful or
wrongful, of any present or future Government Acts.  The L/C Issuers shall not, in any way, be
liable for any failure by the L/C Issuers or anyone else to pay any drawing
under any Letter of Credit as a result of any Government Acts or any other
cause beyond the control of the L/C Issuers.

(iii)          Nothing in this subsection (m)
is intended to limit the reimbursement obligation of the Borrower contained in
this Section 2.05.  The
obligations of the Borrower under this subsection (m) shall survive the
termination of this Agreement.  No act or
omission of any current or prior beneficiary of a Letter of Credit shall in any
way affect or impair the rights of any L/C Issuer to enforce any right, power
or benefit under this Agreement.

(iv)          Notwithstanding anything to the
contrary contained in this subsection (n), the Borrower shall have no
obligation to indemnify any L/C Issuer in respect of any liability incurred by
the L/C Issuer arising solely out of the gross negligence or willful misconduct
of the L/C Issuer, as determined by a court of competent jurisdiction.  Nothing in this Agreement shall relieve any
L/C Issuer of any liability to the Borrower in respect of any action taken by
the L/C Issuer which action constitutes gross negligence or willful misconduct
of the L/C Issuer or a violation of the UCP or Uniform Commercial Code, as
applicable, as determined by a court of competent jurisdiction.

(n)           Resignation of an L/C Issuer.  An L/C Issuer may resign at any time by
giving 60 days’ notice to the Administrative Agent, the Revolving Lenders and
the Borrower; provided, however, 

 57
 

 

that any such
resignation shall not affect the rights or obligations of the L/C Issuer with
respect to Letters of Credit issued by it prior to such resignation.  Upon any such resignation, the Borrower shall
(within 60 days after such notice of resignation) either appoint a successor,
or terminate the unutilized L/C Commitment of such L/C Issuer; provided,
however, that, if the Borrower elects to terminate such unutilized L/C
Commitment, the Borrower may at any time thereafter that the Revolving
Commitments are in effect reinstate such L/C Commitment in connection with the
appointment of another L/C Issuer.  Upon
the acceptance of any appointment as an L/C Issuer hereunder by a successor L/C
Issuer, such successor shall succeed to and become vested with all the
interests, rights and obligations of the retiring L/C Issuer and the retiring
L/C Issuer shall be discharged from its obligations to issue Additional Letters
of Credit hereunder.  The acceptance of
any appointment as L/C Issuer hereunder by a successor L/C Issuer shall be
evidenced by an agreement entered into by such successor, in a form reasonably
satisfactory to the Borrower and the Administrative Agent, and, from and after
the effective date of such agreement, (i) such successor shall be a party
hereto and have all the rights and obligations of an L/C Issuer under this
Agreement and the other Loan Documents and (ii) references herein and in the
other Loan Documents to the “L/C Issuer” shall be deemed to refer to such
successor or to any previous L/C Issuer, or to such successor and all previous
L/C Issuers, as the context shall require. 
After the resignation of an L/C Issuer hereunder the retiring L/C Issuer
shall remain a party hereto and shall continue to have all the rights and
obligations of an L/C Issuer under this Agreement and the other Loan Documents
with respect to Letters of Credit issued by it prior to such resignation but
shall not be required to issue additional Letters of Credit.

(o)           Reporting.  Each L/C Issuer will
report in writing to the Administrative Agent (i) on the first Business Day of
each week, the aggregate face amount of Letters of Credit issued by it and
outstanding as of the last Business Day of the preceding week, (ii) on or prior
to each Business Day on which such L/C Issuer expects to issue, amend, renew or
extend any Letter of Credit, the date of such issuance or amendment, and the
aggregate face amount of Letters of Credit to be issued, amended, renewed or
extended by it and outstanding after giving effect to such issuance, amendment,
renewal or extension (and such L/C Issuer shall advise the Administrative Agent
on such Business Day whether such issuance, amendment, renewal or extension
occurred and whether the amount thereof changed), (iii) on each Business
Day on which such L/C Issuer makes any L/C Disbursement, the date and amount of
such L/C Disbursement and (iv) on any Business Day on which the Borrower fails
to reimburse an L/C Disbursement required to be reimbursed to such L/C Issuer
on such day, the date and amount of such failure.

Section 2.06 
Interest.

(a)           Rate Options Applicable to Loans.  Each Borrowing made prior to the Syndication
Date shall be comprised of Base Rate Loans or (except in the case of Swing Line
Loans, which shall be made and maintained as Base Rate Loans, and L/C
Borrowings, which shall be made initially as Base Rate Loans) Eurodollar Loans
with a three-month (or of a duration less than one month as may be agreed to by
all of the Lenders having Commitments or Loans of the applicable Class)
Interest Period (ending on the same date), as the Borrower may request pursuant
to Section 2.02.  Each Borrowing
made on or after the Syndication Date shall be comprised of Base Rate Loans or
(except in the case of Swing Line Loans, which shall be made and maintained as
Base Rate Loans) Eurodollar Loans, as the Borrower may request pursuant to Section
2.02.  Borrowings of more than one Type
may be outstanding at the same time; provided, however, that the
Borrower may not request any Borrowing that, if made, would result in an
aggregate of more than ten separate Groups of Eurodollar Loans being
outstanding hereunder at any one time. 
For this purpose, Loans having different Interest Periods, regardless of
whether commencing on the same date, shall be considered separate Groups.  Interest hereunder shall be due and payable
in accordance with the terms hereof before and after judgment and before and
after the commencement of any proceeding under any Debtor Relief Law.

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(b)           Base Rate Loans.  Each Loan of a Class which is made as, or
converted into, a Base Rate Loan shall bear interest on the outstanding
principal amount thereof, for each day from the date such Loan is made as, or
converted into, a Base Rate Loan until it becomes due or is converted into a
Loan of any other Type, at a rate per annum equal to the Base Rate for such day
plus the then Applicable Margin.  Such
interest shall be payable in arrears on each Interest Payment Date and, with
respect to the principal amount of any Base Rate Loan converted to a Eurodollar
Loan, on the date such Base Rate Loan is so converted.  Any overdue principal of and, to the extent
permitted by Law, interest on any Base Rate Loan of any Class shall bear
interest, payable on demand, for each day until paid at a rate per annum equal
to the sum of 2% plus the Base Rate for such day plus the Applicable Margin for
Base Rate Loans of the same Class for such day.

(c)           Eurodollar Loans.  Each Eurodollar Loan of a Class shall bear
interest on the outstanding principal amount thereof, for each day during the
Interest Period applicable thereto, at a rate per annum equal to the sum of the
Adjusted Eurodollar Rate for such Interest Period plus the then Applicable
Margin.  Such interest shall be payable
for each Interest Period on each Interest Payment Date.  Any overdue principal of and, to the extent
permitted by Law, interest on any Eurodollar Loan of any Class shall bear
interest, payable on demand, for each day until paid at a rate per annum equal
to the sum of 2% plus the rate otherwise applicable to Eurodollar Loans of the
same Class for such day (or, if the circumstances described in Section 3.02
shall exist, at a rate per annum equal to the sum of 2% plus the Base Rate for
such day plus the Applicable Margin for Base Rate Loans of the same Class for
such day).

(d)           Determination and Notice of Interest Rates.  The Administrative Agent shall determine each
interest rate applicable to the Loans hereunder.  The Administrative Agent shall give prompt
notice to the Borrower and the participating Lenders of each rate of interest
so determined, and its determination thereof shall be conclusive in the absence
of manifest error.  Any notice with
respect to Eurodollar Loans shall, without the necessity of the Administrative
Agent so stating in such notice, be subject to the provisions of the definition
of “Applicable Margin” providing for adjustments in the Applicable
Margin applicable to such Loans after the beginning of the Interest Period
applicable thereto.  When during an
Interest Period any event occurs that causes an adjustment in the Applicable
Margin applicable to Loans to which such Interest Period is applicable, the Administrative
Agent shall give prompt notice to the Borrower and the Lenders of such event
and the adjusted rate of interest so determined for such Loans, and its
determination thereof shall be conclusive in the absence of manifest error.

(e)           Default Interest.  Upon the occurrence and during the
continuance of an Event of Default under Section 8.01(a) or (f),
the principal of and, to the extent permitted by Law, interest on the Loans and
any other amounts owing herein or under the other Loan Documents shall bear
interest, payable on demand, at a per annum rate equal to (i) in the case of
principal of any Loan, the rate otherwise applicable to such Loan during such
period pursuant to this Section 2.06 plus 2.00% (without duplication of
any amount owing in respect of Base Rate Loans under the third sentence of Section
2.06(b) or in respect of Eurodollar Loans under the third sentence of Section
2.06(c)), (ii) in the case of interest on any Loan, the rate specified in
the third sentence of Section 2.06(b) in respect of Base Rate Loans, or
in the third sentence of Section 2.06(c) in respect of Eurodollar Loans,
and (iii) in the case of any other amount, if expressly provided for herein, at
the rate so provided and otherwise at the Base Rate plus the Applicable Margin
for Revolving Base Rate Loans plus 2.00%.

Section 2.07  Extension and
Conversion.

(a)           Continuation and Conversion Options.  The Loans included in each Borrowing shall
bear interest initially at the type of rate allowed by Section 2.06 and
as specified by the Borrower in the applicable Notice of Borrowing.  Thereafter, the Borrower shall have the
option, on any Business 

 59
 

 

Day, to elect
to change or continue the type of interest rate borne by each Group of Loans
(subject in each case to the provisions of Article III and subsection
2.07(d)), as follows:

(i)            if such Loans are Base Rate Loans,
the Borrower may elect to convert such Loans to Eurodollar Loans as of any
Business Day; and

(ii)           if such Loans are Eurodollar Loans,
the Borrower may elect to convert such Loans to Base Rate Loans or elect to
continue such Loans as Eurodollar Loans for an additional Interest Period,
subject to Section 3.05 in the case of any such conversion or
continuation effective on any day other than the last day of the then current
Interest Period applicable to such Loans.

Each such election shall be made by delivering a notice, substantially
in the form of Exhibit A-2 hereto (a “Notice of Extension/Conversion”)
(which may be by telephone if promptly confirmed in writing, which notice shall
not thereafter be revocable by the Borrower, to the Administrative Agent not
later than 12:00 Noon on the third Business Day before the conversion or
continuation selected in such notice is to be effective; provided, however,
that if the Borrower wishes to request to continue Loans as Eurodollar Loans or
convert Loans to Eurodollar Loans in either case having an Interest Period
other than one, two, three or six months in duration as provided in the
definition of “Interest Period”, then the applicable Notice of
Extension/Conversion must be received by the Administrative Agent not later
than 11:00 A.M. on the fourth Business Day before the conversion or
continuation selected in such notice is to be effective, whereupon the
Administrative Agent shall (i) give prompt notice to the Lenders having
Commitments or Loans of the applicable Class and determine whether the
requested Interest Period is acceptable to all of them and (ii) notify the
Borrower not later than 12:00 Noon on the third Business Day before the
conversion or continuation selected in such notice is to be effective (which
notice may be by telephone) whether or not the requested Interest Period has
been consented to by all of the Lenders having Commitments or Loans of the
applicable Class.  A Notice of
Extension/Conversion may, if it so specifies, apply to only a portion of the
aggregate principal amount of the relevant Group of Loans; provided that
(i) such portion is allocated ratably among the Loans comprising such Group and
(ii) the portion to which such Notice of Extension/Conversion applies, and the
remaining portion to which it does not apply, are each $2,000,000 or any larger
multiple of $500,000.

(b)           Contents of Notice of Extension/Conversion.  Each Notice of Extension/Conversion shall specify:

(i)            the Group of Loans (or portion
thereof) to which such notice applies;

(ii)           the date on which the conversion or
continuation selected in such notice is to be effective, which shall comply
with the applicable clause of subsection 2.07(a) above;

(iii)          if the Loans comprising such Group are
to be converted, the new Type of Loans and, if the Loans being converted are to
be Eurodollar Loans, the duration of the next succeeding Interest Period
applicable thereto; and

(iv)          if such Loans are to be continued as
Eurodollar Loans for an additional Interest Period, the duration of such
additional Interest Period.

Each Interest Period specified in a Notice of Interest Rate Election
shall comply with the provisions of the definition of the term “Interest Period”.  If no Notice of Extension/Conversion is
timely received prior to the end of an Interest Period for any Group of
Eurodollar Loans, the Borrower shall be deemed to have elected that such Group
be converted to Base Rate Loans as of the last day of such Interest Period.

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(c)           Notification to Lenders.  Upon receipt of a Notice of
Extension/Conversion from the Borrower pursuant to subsection 2.07(a)
above, the Administrative Agent shall promptly notify each Lender of the
contents thereof.

(d)           Limitation on Conversion/Continuation Options.  The Borrower shall not be entitled to elect
to convert any Loans to, or continue any Loans for an additional Interest
Period as, Eurodollar Loans if (i) the aggregate principal amount of any Group
of Eurodollar Loans created or continued as a result of such election would be
less than $2,000,000 or (ii) a Default shall have occurred and be continuing
when the Borrower delivers notice of such election to the Administrative Agent
and the Required Lenders have directed the Administrative Agent during the
period of such Event of Default that Eurodollar Loans shall no longer be made
available to the Borrower.

(e)           Accrued Interest.  Accrued interest on a Loan (or portion
thereof) being extended or converted shall be paid by the Borrower (i) with
respect to any Base Rate Loan being converted to a Eurodollar Loan, on the last
Business Day of the first fiscal quarter of the Borrower ending on or after the
date of conversion and (ii) otherwise, on the date of extension or conversion.

Section 2.08 
Maturity of Loans.

(a)           Maturity of Revolving Loans.  The Revolving Loans shall mature on the
Revolving Termination Date, and any Revolving Loans, Swing Line Loans and L/C
Obligations then outstanding (together with accrued interest thereon and fees
in respect thereof) shall be due and payable on such date.

(b)           Scheduled Amortization of Term B Loans.  The Borrower shall repay, and there shall
become due and payable (together with accrued interest thereon) on each
Principal Amortization Payment Date and on the Term B Maturity Date (i) the sum
of (A) 1⁄4 of 1% of the aggregate initial principal amount of the Term B Loans
outstanding at the close of the Availability Period for Term B Loans in the
case of the first 27 Principal Amortization Payment Dates and (B) 1⁄4 of 1% of
the aggregate initial principal amount of each additional Term B Loans made as
part of a Facilities Increase in the case of each of the then remaining
Principal Amortization Payment Dates occurring after each such applicable
Facilities Increase and prior to the Term B Maturity Date and (ii) the
remaining outstanding principal amount of all Term B Loans on the Term B
Maturity Date.

Section 2.09 
Prepayments.

(a)           Voluntary Prepayments.  The Borrower shall have the right voluntarily
to prepay Loans in whole or in part from time to time, subject to Section
3.05; provided, however, that (i) each partial prepayment of
Loans shall be in a minimum principal amount of $1,000,000 or a whole multiple
of $500,000 in excess thereof, in the case of Eurodollar Loans, and $500,000 or
a whole multiple of $100,000 in excess thereof, in the case of Base Rate Loans
and (ii) the Borrower shall have given prior written or telecopy notice (or
telephone notice promptly confirmed by written or telecopy notice) to the
Administrative Agent, in the case of any Revolving Loan which is a Base Rate
Loan or any Swing Line Loan, by 1:00 P.M. (or 1:30 P.M. in the case of Swing
Line Loans), on the date of prepayment and, in the case of any other Loan, by
1:00 P.M., at least three Business Days prior to the date of prepayment.  Each notice of prepayment shall specify the
prepayment date, the principal amount to be prepaid, whether the Loan to be
prepaid is a Revolving Loan, Term B Loan, or Swing Line Loan, whether the Loan
to be prepaid is a Eurodollar Loan or a Base Rate Loan and, in the case of a
Eurodollar Loan, the Interest Period of such Loan.  Each notice of prepayment shall be
irrevocable and shall commit the Borrower to prepay such Loan by the amount
stated therein on the date stated therein. 
Subject to the foregoing and to Section 5.18, amounts prepaid
under this Section 2.09(a) shall be applied as the Borrower may elect; 

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provided
that if the Borrower fails to specify the application of a voluntary
prepayment, then such prepayment shall be applied first to Revolving Loans,
then to Swing Line Loans and then to the Term B Loans (in each case ratably to
the remaining Principal Amortization Payments thereof), in each case first to
Base Rate Loans and then to Eurodollar Loans in direct order of Interest
Period.  All prepayments of Eurodollar
Loans under this Section 2.09(a) shall be accompanied by accrued
interest on the principal amount being prepaid to the date of payment.

(b)           Mandatory Prepayments.

(i)            Revolving Committed Amount.  If on any date the aggregate Revolving
Outstandings exceed the Revolving Committed Amount, the Borrower shall repay,
and there shall become due and payable (together with accrued interest
thereon), on such date an aggregate principal amount of Swing Line Loans equal
to such excess.  If the outstanding Swing
Line Loans have been repaid in full, the Borrower shall prepay, and there shall
become due and payable (together with accrued interest thereon), Revolving
Loans in such amounts as are necessary so that, after giving effect to the
repayment of the Swing Line Loans and the repayment of Revolving Loans, the
aggregate Revolving Outstandings do not exceed the Revolving Committed
Amount.  If the outstanding Revolving
Loans and Swing Line Loans have been repaid in full, the Borrower shall Cash
Collateralize L/C Obligations so that, after giving effect to the repayment of
Swing Line Loans and Revolving Loans and the Cash Collateralization of L/C
Obligations pursuant to this subsection (i), the aggregate Revolving
Outstandings does not exceed the Revolving Committed Amount.  In determining the aggregate Revolving
Outstandings for purposes of this subsection (i), L/C Obligations shall
be reduced to the extent that they are Cash Collateralized as contemplated by
this subsection (i).  Each
prepayment of Revolving Loans required pursuant to this subsection (i)
shall be applied ratably among outstanding Revolving Loans based on the
respective amounts of principal then outstanding.  Each Cash Collateralization of L/C
Obligations required by this subsection (i) shall be applied ratably
among L/C Obligations based on the respective amounts thereof then outstanding.

(ii)           Excess Cash Flow.  Within 100 days after the end of each fiscal
year of Holdings (commencing with the fiscal year ending October 31, 2007), the
Borrower shall prepay the Loans and/or Cash Collateralize or pay the L/C
Obligations in an amount equal to Applicable Percentage of the Excess Cash Flow
for such prior fiscal year.  As used in
this Section 2.09(b)(ii), the term “Applicable Percentage” for
any fiscal year means (i) 50% or (ii) if the Senior Leverage Ratio as of the
last day of the fiscal year in respect of which Excess Cash Flow is being
determined is less than 3.0 to 1.0, then the Applicable Percentage shall be
zero for that fiscal year.

(iii)          Asset Dispositions, Casualties and Condemnations, etc.  Within five Business Days after receipt by
any Group Company of Net Cash Proceeds from any Asset Disposition (other than
any Excluded Asset Disposition), Casualty or Condemnation, the Borrower shall
prepay the Loans and/or Cash Collateralize or pay the L/C Obligations in an
aggregate amount equal to 100% of the Net Cash Proceeds of such Asset
Disposition, Casualty or Condemnation; provided, that no such prepayment caused
by the receipt of Net Cash Proceeds from any Asset Disposition shall be
required to the extent that the sum of such Net Cash Proceeds and all other Net
Cash Proceeds from Asset Dispositions occurring after the Closing Date and
during the same fiscal year does not exceed $5,000,000 (it being understood
that a prepayment shall only be required of such excess).

(iv)          Debt Issuances.  Within five Business Days after receipt by
any Group Company of Net Cash Proceeds from any Debt Issuance (other than any
Debt Issuance permitted pursuant to clauses (i) through (xvi) of Section
7.01 of this Agreement), the Borrower shall 

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prepay the
Loans and/or Cash Collateralize the L/C Obligations in an aggregate amount
equal to 100% of the Net Cash Proceeds of such Debt Issuance.

(v)           Payments in Respect of Subordinated Indebtedness.  Immediately upon receipt by the
Administrative Agent or any Lender of any amount so payable pursuant to the
subordination provision of any Indebtedness of Holdings or any of its
Subsidiaries that is subordinate to the Senior Credit Obligations, all proceeds
thereof shall be applied as set forth in subsection (vi)(B) below.

(vi)          Application of Mandatory Prepayments.  Subject to Section 8.03, all amounts
required to be paid pursuant to this Section 2.09(b) shall be applied as
follows:

(A)          with respect to all
amounts paid pursuant to Section 2.09(b)(i), first to Swing Line Loans,
second to Revolving Loans and third to Cash Collateralize L/C Obligations;

(B)           with respect to all
amounts paid pursuant to Section 2.09(b)(ii), (iii), (iv)
or (v), (1) first to the Term B Loans (ratably to the remaining
Principal Amortization Payments thereof or, at the option of the Borrower, in
direct order for not more than the next four Principal Amortization Payments
and then ratably to the remaining Principal Amortization Payments thereof)
(with a corresponding reduction in the Term B Committed Amount pursuant to Section
2.10(c), and (2) second, (x) to the Swing Line Loans (with a corresponding
reduction in the Swing Line Committed Amount pursuant to Section 2.10(c)),
(y) then to Revolving Loans (with a corresponding reduction in the Revolving
Committed Amount pursuant to Section 2.10(c)), and (z) then to Cash
Collateralize L/C Obligations.

(vii)         Order of Applications.  Any amounts required to be applied to
Revolving Outstandings as provided in this Section 2.09(b) above
remaining after such application shall be applied to the Term B Loans (in each
case ratably to the remaining Principal Amortization Payments thereof).  Within the parameters of the applications set
forth above, prepayments shall be applied first to Base Rate Loans and then,
subject to subsection (viii) below, to Eurodollar Loans in direct order
of Interest Period maturities.  All
prepayments under this Section 2.09(b) shall be subject to Section
3.05 and to paragraph (c) below. 
All prepayments under this Section 2.09(b) shall be accompanied
by accrued interest on the principal amount being prepaid to the date of
payment.

(viii)        Prepayment Accounts.  Amounts to be applied as provided in subsection (vi)
above to the prepayment of Loans of any Class shall be applied first to reduce
outstanding Base Rate Loans of such Class. 
Any amounts remaining after each such application shall, at the option
of the Borrower, be applied to prepay Eurodollar Loans of such Class
immediately and/or shall be deposited in a separate Prepayment Account (as
defined below) for the Loans of such Class. 
The Administrative Agent shall apply any cash deposited in the Prepayment
Account for any Class of Loans, upon withdrawal by the Collateral Agent, to
prepay Eurodollar Loans of such Class on the last day of their respective
Interest Periods (or, at the direction of the Borrower, on any earlier date)
until all outstanding Loans of such Class have been prepaid or until all the
allocable cash on deposit in the Prepayment Account for such Class has been
exhausted.  For purposes of this
Agreement, the term “Prepayment Account” for any Class of Loans shall
mean an account (which may include the Prepayment Account established under the
Security Agreement) established by the Borrower with the Collateral Agent and
over which the Collateral Agent shall have exclusive dominion and control,
including the exclusive right of 

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withdrawal for
application in accordance with this subsection (viii).  The Collateral Agent will, at the request of
the Borrower, invest amounts on deposit in the Prepayment Account for any Class
of Loans in Cash Equivalents that mature prior to the last day of the
applicable Interest Periods of the Eurodollar Loans of such Class to be
prepaid; provided, however, that (i) the Collateral Agent
shall not be required to make any investment that, in its sole judgment, would
require or cause the Collateral Agent to be in, or would result in any,
violation of any Law, (ii) such Cash Equivalents shall be subjected to a
Requisite Priority Lien in favor of the Collateral Agent and (iii) if any Event
of Default shall have occurred and be continuing, the selection of such Cash
Equivalents shall be in the sole discretion of the Collateral Agent.  The Borrower shall indemnify the Collateral
Agent for any losses relating to such investments in Cash Equivalents so that
the amount available to prepay Eurodollar Loans on the last day of the
applicable Interest Periods is not less than the amount that would have been
available had no investments been made pursuant thereto.  Other than any interest or profits earned on
such investments, the Prepayment Accounts shall not bear interest.  Interest or profits, if any, on the
investments in any Prepayment Account shall accumulate in such Prepayment
Account until all outstanding Loans of any applicable Class with respect to
which amounts have been deposited in the Prepayment Accounts have been prepaid
in full, at which time so much thereof as is not required to make payment of
the Senior Credit Obligations which have become due and payable (whether by
scheduled maturity, acceleration or otherwise) shall be withdrawn by the
Collateral Agent on the next Business Day following the day on which the
Collateral Agent considers the funds deposited therein to be collected funds
and disbursed to the Borrower or its order. 
If the maturity of the Loans has been accelerated pursuant to Section
8.02, the Administrative Agent may, in its sole discretion, cause the
Collateral Agent to withdraw amounts on deposit in the Prepayment Account for
the applicable Class of Loans and, subject to Section 8.03, apply such
funds to satisfy the Senior Credit Obligations of the applicable Class or
Classes.

(ix)           Notice.  The Borrower shall give to the Administrative
Agent and the Lenders at least five Business Days’ prior written or telecopy
notice of each and every event or occurrence requiring a prepayment under Section
2.09(b)(ii), (iii), (iv) or (v), including the amount
of Net Cash Proceeds expected to be received therefrom and the expected
schedule for receiving such proceeds; provided, however, that in
the case of any prepayment event consisting of a Casualty or Condemnation, the
Borrower shall give such notice within five Business Days after the occurrence
of such event.

Section 2.10 
Adjustment of Commitments.

(a)           Optional Increase of Revolving and Term B Commitments.

(i)            The Borrower shall
have the right to give the Administrative Agent, after the Closing Date, a
Facilities Increase Notice to request an increase (each a “Facilities
Increase”) in the aggregate Revolving Commitments or the disbursement of
Term B Loans in excess of the Term B Loans previously disbursed, in a principal
amount not to exceed $200,000,000 in the aggregate for all such requests; provided,
however, that (A) no Facilities Increase in the Revolving Commitments
shall be effective later than one year prior to the Revolving Termination Date,
(B) no Facilities Increase in the Term B Commitments shall be effective later
than two years prior to the Term B Maturity Date, (C) no Facilities Increase
shall be effective earlier than 10 days after the delivery of the Facilities
Increase Notice to the Administrative Agent in respect of such Facilities
Increase and (D) no more than three Facilities Increases shall be made.

(ii)           The Administrative
Agent shall promptly notify each Lender of the proposed Facilities Increase and
of the proposed terms and conditions therefor agreed between 

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the Borrower
and the Administrative Agent.  Each such
Lender (and each of their Affiliates and Approved Funds) may, in its sole
discretion, commit to participate in such Facilities Increase by forwarding its
commitment to the Administrative Agent therefor in form and substance
satisfactory to the Administrative Agent within 10 days of receipt of such
notice.  The Administrative Agent shall
allocate, in its sole discretion but in amounts not to exceed for each such
Lender the commitment received from such Lender, Affiliate or Approved Fund,
the Commitments to be made as part of the Facilities Increase to the Lenders
from which it has received such written commitments.  If the Administrative Agent does not receive
sufficient commitments from existing Lenders or their Affiliates or Approved
Funds, it may, after consultation with the Borrower, allocate to Eligible
Assignees any excess of the proposed amount of such Facilities Increase agreed
with the Borrower over the aggregate amounts of the commitments received from
existing Lenders.

(iii)          Each Facilities
Increase shall become effective on a date agreed by the Borrower and the
Administrative Agent (each a “Facilities Increase Date”), which shall be
in any case on or after the date of satisfaction of the conditions precedent
set forth in Section 4.05 and following notice to the Lenders and the
Borrower of  such effectiveness.  Once a Facilities Increase becomes effective,
the Administrative Agent shall record in the Register all applicable additional
information in respect of such Facilities Increase.

(iv)          On the Facilities
Increase Date for any Facilities Increase in the Revolving Commitments, each
Lender participating in such Facilities Increase shall purchase from each
existing Revolving Lender having Revolving Loans outstanding on such Facilities
Increase Date, without recourse or warranty, an undivided participation
interest in such outstanding Revolving Loans in the proportion its Revolving
Commitment Percentage bears to the Revolving Committed Amount (after giving
effect to such Facilities Increase) so as to ensure that, on the Facilities
Increase Date after giving effect to such Facilities Increase, each Revolving
Lender is owed no more than its proportionate share of the Revolving Loans
outstanding on such Facilities Increase Date.

(v)           From and after the
Facilities Increase Date, the term “Lenders”, as used herein, shall
include all Eligible Assignees which become Lenders pursuant to this Section
2.10(a).

This subsection (a) shall supersede any provisions of Section
2.13 or 10.01 to the contrary.

(b)           Optional Termination or Reduction of Commitments
(Pro-Rata).  The Borrower
may from time to time permanently reduce or terminate the Revolving Committed
Amount in whole or in part (in minimum aggregate amounts of $2,000,000 or any
whole multiple of $500,000 in excess thereof (or, if less, the full remaining
amount of the then applicable Revolving Committed Amount)) upon five Business
Days’ prior written or telecopy notice to the Administrative Agent; provided,
however, that no such termination or reduction shall be made which would
cause the Revolving Outstandings to exceed the Revolving Committed Amount as so
reduced, unless, concurrently with such termination or reduction, the Revolving
Loans are repaid (and, after the Revolving Loans have been paid in full, the
Swing Line Loans are repaid and, after the Swing Line Loans have been paid in
full, the L/C Obligations are Cash Collateralized) to the extent necessary to
eliminate such excess.  The Borrower
shall pay to the Administrative Agent for the account of the Lenders in
accordance with the terms of Section 2.11, on the date of each
termination or reduction of the Revolving Committed Amount, any fees accrued
through the date of such termination or reduction on the amount of the
Revolving Committed Amount so terminated or reduced.  In addition, during the Availability Period
for Term B Loans, the Borrower may, upon notice to the Administrative Agent, terminate
(in whole or in part) the unused portion of the aggregate Term B 

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Commitments.  The Administrative
Agent shall promptly notify each affected Lender of the receipt by the
Administrative Agent of any notice from the Borrower pursuant to this Section
2.10(b).  Any partial reduction of
the Revolving Committed Amount pursuant to this Section 2.10(b) shall be
applied to the Revolving Commitments of the Lenders pro-rata based upon their
respective Revolving Commitment Percentages. 
Any partial reduction of the Term B Committed Amount pursuant to this Section
2.10(b) shall be applied to the Term B Commitments of the Lenders pro-rata
based upon their respective Term B Commitment Percentages.

(c)           Mandatory Reductions of Revolving Commitments.  On any date that any Term B Loans are
required to be prepaid pursuant to the terms of Section 2.09(b)(ii), (iii),
(iv) or (v) (or would be so required if any Term B Loans were
outstanding), the Term B Committed Amount shall be automatically and
permanently reduced by the total amount of such required (and, in the event
that the amount of any payment referred to in Section 2.09(b)(ii), (iii),
(iv) or (v) which is allocable to the Term B Loan exceeds the
amount of all outstanding Term B Loans, the Term B Committed Amount shall be
further reduced by 100% of such excess). 
On any date that any Revolving Loans are required to be prepaid, Swing
Line Loans are required to be prepaid and/or L/C Obligations are required to be
Cash Collateralized pursuant to the terms of Section 2.09(b)(ii), (iii),
(iv) or (v) (or would be so required if any Revolving Loans,
Swing Line Loans or L/C Obligations were outstanding), the Revolving Committed
Amount shall be automatically and permanently reduced by the total amount of
such required prepayments and cash collateral (and, in the event that the
amount of any payment referred to in Section 2.09(b)(ii), (iii), (iv)
or (v) which is allocable to the Revolving Outstandings exceeds the
amount of all outstanding Revolving Outstandings, the Revolving Committed
Amount shall be further reduced by 100% of such excess).

(d)           Termination; Pro-Rata Application.  The Revolving Commitments of the Lenders and
the L/C Commitments of the L/C Issuers shall terminate automatically on the
Revolving Termination Date.  The Swing
Line Commitment of the Swing Line Lender shall terminate automatically on the
Swing Line Termination Date.  The Term B
Commitments of the Lenders shall terminate automatically immediately at the end
of the Availability Period for Term B Loans, subject to a subsequent Facilities
Increase pursuant to paragraph (a) above.

(e)           Replacement of Lenders.  If (i) any Lender has demanded compensation
or indemnification pursuant to Section 3.01 or Section 3.04, (ii)
the obligation of any Lender to make Eurodollar Loans has been suspended
pursuant to Section 3.02, (iii) any Lender is a Defaulting Lender or
(iv) any Lender has failed to consent to a proposed amendment, waiver,
discharge or termination which pursuant to the terms of Section 10.01 or
any other provision of any Loan Document requires the consent of all of the
Lenders of a Class or Class and with respect to which the Required Lenders for
such Class or Classes shall have granted their consent, the Borrower shall have
the right, if no Default or Event of Default then exists, to (i) remove such
Lender by terminating such Lender’s Commitment in full or (ii) replace such
Lender by causing such Lender to assign its Commitment to one or more existing
Lenders or Eligible Assignees pursuant to Section 10.07; provided,
however, that (x) if the Borrower elects to exercise such right with
respect to any Lender pursuant to clause (i) or (ii) above, it
shall be obligated to remove or replace, as the case may be, all Lenders that
have similar requests then outstanding for compensation pursuant to Section 3.01
or 3.04 or whose obligation to make Eurodollar Loans has been similarly
suspended and (y) in the case of any replacement of Lenders under the
circumstances described in clause (iv) above, the applicable amendment,
waiver, discharge or termination that the Borrower has requested shall become
effective upon giving effect to such replacement (and any related Assignment
and Assumptions required to be effected in connection therewith in accordance
with this paragraph (e)).  The
replacement of a Lender pursuant to this Section 2.10(e) shall be
effective on the tenth Business Day (the “Replacement Date”) following
the date of notice of such replacement to the Lenders through the
Administrative Agent, subject to the satisfaction of the following conditions:

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(i)            each replacement
Lender and/or Eligible Assignee, and the Administrative Agent acting on behalf
of each Lender subject to replacement, shall have satisfied the conditions to
an Assignment and Assumption set forth in Section 10.07(b) and, in
connection therewith, the replacement Lender(s) and/or Eligible Assignee(s)
shall pay:

(A)          to each Lender
subject to replacement an amount equal in the aggregate to the sum of (x) the
principal of, and all accrued but unpaid interest on, its outstanding Loans,
(y) all L/C Disbursements that have been funded by (and not reimbursed to) it
under Section 2.05, together with all accrued but unpaid interest with
respect thereto, and (z) all accrued but unpaid fees owing to it pursuant to Section
2.11; and

(B)           to the L/C Issuers
an amount equal to the aggregate amount owing by the replaced Lenders to the
L/C Issuers as reimbursement pursuant to Section 2.05, to the extent
such amount was not theretofore funded by such replaced Lenders; and

(ii)           the Borrower shall
have paid to the Administrative Agent for the account of each replaced Lender
all obligations owing to such replaced Lenders by the Borrower pursuant to this
Agreement and the other Loan Documents (other than those obligations of the
Borrower referred to in clause (i)(A) above).

In
the case of the removal of a Lender pursuant to this Section 2.10(e),
upon (i) payment by the Borrower to the Administrative Agent for the account of
the Lender subject to such removal of an amount equal to the sum of (A) the
aggregate principal amount of all Loans and L/C Obligations held by such Lender
and (B) all accrued interest, fees and other amounts owing to such Lender
hereunder, including, without limitation, all amounts payable by the Borrower
to such Lender under Article III or Sections 10.04 and 10.05,
and (ii) provision by the Borrower to the Swing Line Lender and each L/C Issuer
of appropriate assurances and indemnities (which may include letters of credit)
as each may reasonably require with respect to any continuing obligation of
such removed Lender to purchase Participation Interests in any L/C Obligations
or Swing Line Loans then outstanding, such Lender shall, without any further
consent or other action by it, cease to constitute a Lender hereunder; provided
that the provisions of this Agreement (including, without limitation, the
provisions of Article III and Sections 10.04 and 10.05)
shall continue to govern the rights and obligations of a removed Lender with
respect to any Loans made, any Letters of Credit issued or any other actions
taken by such removed Lender while it was a Lender.

(f)            General.  The Borrower shall pay to the Administrative
Agent for the account of the Lenders in accordance with the terms of Section
2.10, on the date of each termination of the Revolving Committed Amount,
the Commitment Fee accrued through the date of such termination on the amount
of the Revolving Committed Amount so terminated.

Section 2.11 
Fees.

(a)           Commitment Fee.  The Borrower shall pay to the Administrative
Agent for the account of each Revolving Lender a fee (the “Commitment Fee”)
on such Lender’s Revolving Commitment Percentage of the daily Unused Revolving
Committed Amount, computed at a per annum rate for each day at a rate equal to
the then applicable rate per annum set forth under clause (c) of the
definition of “Applicable Margin” in Section 1.01.  The Commitment Fee shall commence to accrue
on the Closing Date and shall be due and payable in arrears on the last
Business Day of each March, June, September and December (and on the Revolving
Termination Date) for the quarter or portion thereof ending on each such date,
beginning with the first of such dates to occur after the Closing Date.

 

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(b)           Letter of Credit Fees.

(i)            Standby Letter of Credit Issuance Fee.  The Borrower shall pay to the Administrative
Agent for the account of each Revolving Lender a fee (the “Standby Letter of
Credit Fee”) on such Lender’s Revolving Commitment Percentage of the
average daily maximum amount available to be drawn under each such Standby
Letter of Credit (whether or not such maximum amount is then in effect under
such Letter of Credit) computed at a per annum rate for each day from the date
of issuance to the date of expiration equal to the Applicable Margin for
Standby Letter of Credit Fees in effect from time to time.  The Standby Letter of Credit Fee will be
computed on a quarterly basis in arrears and shall be due and payable on the
first Business Day after the end of each March, June, September and December,
commencing with the first of such dates to occur after the date of issuance of
such Letter of Credit, and on the Letter of Credit Expiration Date and
thereafter on demand.

(ii)           Trade Letter of Credit Fee.  The Borrower shall pay to the Administrative
Agent for the account of each Revolving Lender a fee (the “Trade Letter of
Credit Fee”) on such Lender’s Revolving Commitment Percentage of the
average daily maximum amount available to be drawn under each such Trade Letter
of Credit (whether or not such maximum amount is then in effect under such
Letter of Credit) computed at a per annum rate for each day from the date of
issuance to the date of expiration equal to the Applicable Margin for Trade
Letter of Credit Fees in effect from time to time.  The Trade Letter of Credit Fee will be
computed on a quarterly basis in arrears and shall be due and payable on the
first Business Day after the end of each March, June, September and December,
commencing with the first such date after the issuance of such Letter of
Credit, and on the Letter of Credit Expiration Date and thereafter on demand.

(iii)          Fronting Fees.  The Borrower shall pay directly to each L/C
Issuer for its own account a fronting fee in the amount (A) with respect to
each Trade Letter of Credit, equal to .125% of the amount of such Trade Letter
of Credit (or such higher amount as may be agreed to between the Borrower and
the L/C Issuer), due and payable upon the issuance thereof and (B) with respect
to each Standby Letter of Credit, equal to .125% per annum (or such higher
amount as may be agreed to between the Borrower and the L/C Issuer) on the
daily maximum amount available to be drawn thereunder (whether or not such
maximum amount is then in effect under such Letter of Credit).  Such fronting fee shall be computed on a
quarterly basis in arrears and shall be due and payable on the first Business
Day after the end of each March, June, September and December, commencing with
the first such date after the issuance of such Letter of Credit, and on the
Letter of Credit Expiration Date and thereafter on demand.

(iv)          L/C Issuer Fees.  In addition to the Standby Letter of Credit
Fee payable pursuant to clause (i) above and the Trade Letter of Credit
Fee payable pursuant to clause (ii) above and any fronting fees
payable pursuant to clause (iii) above, the Borrower promises to pay to
the L/C Issuer for its own account without sharing by the other Lenders the
customary charges from time to time of the L/C Issuer with respect to the
issuance, amendment, transfer, administration, cancellation and conversion of,
and drawings under, such Letters of Credit (collectively, the “L/C Issuer
Fees”).  L/C Issuer Fees are due and
payable on demand and are nonrefundable.

(v)           Computation of Certain Fees after Default.  Upon the occurrence and during the
continuance of an Event of Default under Section 8.01(a) or (f),
the Standby Letter of Credit Fee and the Trade Letter of Credit Fee payable
under subsections (i) and (ii) above shall be computed at a rate
per annum equal to the relevant Applicable Margin with respect to the L/C Fee

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(including
both the Standby Letter of Credit Fee and the Trade Letter of Credit Fee) as
set forth in the applicable table in the definition of “Applicable Margin” in Section
1.01 hereof plus 2.00%.

(c)           Other Fees.  The Borrower shall pay to the Arranger and
the Administrative for their own respective accounts fees in the amounts and at
the times as they may agree.  Such fees
shall be fully earned when paid and shall not be refundable for any reason
whatsoever.  The Borrower shall pay to
the Lenders such fees as shall have been separately agreed upon in writing in
the amounts and at the times so specified. 
Such fees shall be fully earned when paid and shall not be refundable
for any reason whatsoever.

Section 2.12 
Pro-rata Treatment.  Except
to the extent otherwise provided herein:

(a)           Loans. 
Each Borrowing, each payment or prepayment of principal of or interest
on any Loan, each payment of fees (other than the L/C Issuer Fees retained by
an L/C Issuer for its own account and the administrative fees retained by the
Agents for their own account), each reduction of the Revolving Committed Amount
and each conversion or continuation of any Loan, shall be allocated pro-rata
among the relevant Lenders in accordance with the respective Revolving
Commitment Percentages, Term B Commitment Percentages, as applicable, of such
Lenders (or, if the Commitments of such Lenders have expired or been
terminated, in accordance with the respective principal amounts of the
outstanding Loans of the applicable Class and Participation Interests of such
Lenders); provided that, in the event any amount paid to any Lender
pursuant to this subsection (a) is rescinded or must otherwise be
returned by the Administrative Agent, each Lender shall, upon the request of
the Administrative Agent, repay to the Administrative Agent the amount so paid
to such Lender, with interest for the period commencing on the date such
payment is returned by the Administrative Agent until the date the
Administrative Agent receives such repayment at a rate per annum equal to,
during the period to but excluding the date two Business Days after such
request, the Federal Funds Rate, and thereafter, the Base Rate plus 2.00% per
annum.

(b)           Letters of Credit.  Each payment of L/C Obligations shall be
allocated to each Revolving Lender pro-rata in accordance with its Revolving
Commitment Percentage; provided that, if any Revolving Lender shall have
failed to pay its applicable pro-rata share of any L/C Disbursement as required
under Section 2.05(e)(iv) or (vi), then any amount to which such
Revolving Lender would otherwise be entitled pursuant to this subsection (b)
shall instead be payable to the L/C Issuer.

Section 2.13 
Sharing of Payments.
 The Lenders agree among
themselves that, except to the extent otherwise provided herein, if any Lender
shall obtain payment in respect of any Loan, unreimbursed L/C Disbursements or
any other obligation owing to such Lender under this Agreement through the
exercise of a right of setoff, banker’s lien or counterclaim, or pursuant to a
secured claim under Section 506 of the Bankruptcy Code or other security or
interest arising from, or in lieu of, such secured claim, received by such
Lender under any applicable Debtor Relief Laws or otherwise, or by any other
means, in excess of its pro-rata share of such payment as provided for in this
Agreement, such Lender shall promptly pay in cash or purchase from the other
Lenders a participation in such Loans, unreimbursed L/C Disbursements and other
obligations in such amounts, and make such other adjustments from time to time,
as shall be equitable to the end that all Lenders share such payment in
accordance with their respective ratable shares as provided for in this
Agreement; provided that nothing in this Section 2.13 shall
impair the right of any Lender to exercise any right of set-off or counterclaim
it may have for payment of indebtedness of the Borrower other than its
indebtedness hereunder.  The Lenders
further agree among themselves that if payment to a Lender obtained by such
Lender through the exercise of a right of setoff, banker’s lien, counterclaim
or other event as aforesaid shall be rescinded or must otherwise be restored,
each Lender which shall have shared the benefit of such payment shall, by
payment in cash or a repurchase of a participation theretofore sold, return its
share of that benefit

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(together with its share of any accrued interest payable with respect
thereto) to each Lender whose payment shall have been rescinded or otherwise
restored.  Holdings and the Borrower
agree that any Lender so purchasing such a participation may, to the fullest
extent permitted by Law, exercise all rights of payment, including setoff, banker’s
lien or counterclaim, with respect to such participation as fully as if such
Lender were a holder of such Loan, L/C Obligation or other obligation in the
amount of such participation.  The
Administrative Agent will keep records (which shall be conclusive and binding
in the absence of manifest error) of participations purchased under this
Section and will in each case notify the Lenders following any such purchases
or repayments.  Each Lender that
purchases a participation pursuant to this Section shall from and after such
purchase have the right to give all notices, requests, demands, directions and
other communications under this Agreement with respect to the portion of the
Loan, L/C/ Obligation or other obligation purchased to the same extent as though
the purchasing Lender were the original owner of the obligations
purchased.  If under any applicable
Debtor Relief Law, any Lender receives a secured claim in lieu of a setoff to
which this Section 2.13 applies, such Lender shall, to the extent practicable,
exercise its rights in respect of such secured claim in a manner consistent
with the rights of the Lenders under this Section 2.13 to share in the
benefits of any recovery on such secured claim.

Section 2.14 
Payments; Computations.

(a)           Payments by the Borrower.  Each payment of principal of and interest on
Loans, L/C Obligations and fees hereunder (other than fees payable directly to
the L/C Issuers) shall be paid not later than 2:00 P.M. on the date when due,
in Federal or other funds immediately available to the Administrative Agent at
the account designated by it by notice to the Borrower.  Each such payment shall be made without
condition or deduction for any counterclaim, defense, recoupment or setoff and
irrespective of any claim or defense to payment which might in the absence of
this provision be asserted by the Borrower or any Affiliate against the any
Agent or any Lender.  Payments received
after 2:00 P.M. shall be deemed to have been received on the next Business Day,
and any applicable interest or fee shall continue to accrue.  Except for payments and other amounts
received by the Administrative Agent and applied in accordance with the
provisions of paragraph (d) below or required to be applied in
accordance with Section 2.09(b)(vi), the Borrower shall, at the time it
makes any payments under this Agreement, specify to the Administrative Agent
the Loan, Letters of Credit, fees or other amounts payable by the Borrower
hereunder to which such payment is to be applied (and if it fails to specify or
if such application would be inconsistent with the terms hereof, the
Administrative Agent shall, subject to paragraph (d) below, to Section
2.08, to Section 2.09(b)(vi) and to Section 2.12 , distribute
such payment to the Lenders in such manner as the Administrative Agent may deem
reasonably appropriate).  The
Administrative Agent may in its sole discretion, distribute such payments to
the applicable Lenders on the date of receipt thereof, if such payment is received
prior to 2:00 P.M.; otherwise the Administrative Agent may, in its sole
discretion, distribute such payment to the applicable Lenders on the date of
receipt thereof or on the immediately succeeding Business Day.  Whenever any payment hereunder shall be due
on a day which is not a Business Day, the date for payment thereof shall be
extended to the next succeeding Business Day unless (in the case of Eurodollar
Loans) such Business Day falls in another calendar month, in which case the
date for payment thereof shall be the next preceding Business Day.  If the date for any payment of principal is
extended by operation of Law or otherwise, interest thereon shall be payable
for such extended time.  The Borrower
hereby authorizes and directs the Administrative Agent to debit any account
maintained by the Borrower with the Administrative Agent to pay when due any
amounts required to be paid from time to time under this Agreement.

(b)           Distributions by the Administrative Agent.  Unless the Administrative Agent shall have
received notice (which may be by telephone if promptly confirmed in writing)
from the Borrower prior to the date on which any payment is due to the Lenders
hereunder that the Borrower will not make such payment in full, the
Administrative Agent may assume that the Borrower has made such payment in

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full to the Administrative Agent on such date, and the Administrative
Agent may, in reliance upon such assumption, cause to be distributed to each
Lender on such due date an amount equal to the amount then due such
Lender.  If and to the extent that the
Borrower shall not have so made such payment, each Lender shall repay to the
Administrative Agent forthwith on demand such amount distributed to such Lender
together with interest thereon, for each day from the date such amount is
distributed to such Lender until the date such Lender repays such amount to the
Administrative Agent, at the Federal Funds Rate.

(c)           Computations.  All computations of interest for Base Rate
Loans when the Base Rate is determined by JPMCB’s “prime rate” and all computations
of fees hereunder shall be made on the basis of a year of 365 or 366 days, as
the case may be, and actual days elapsed. 
All other computations of interest shall be made on the basis of a
360-day year and actual days elapsed (which results in more interest being paid
than if computed on the basis of a 365-day year).  Interest shall accrue from and including the
date of borrowing (or continuation or conversion) but excluding the date of
payment; provided that any Loan that is repaid on the same day on which
it is made shall, subject to Section 2.14(a), bear interest for one day.

(d)           Certain Payments after an Event of Default.  The Borrower hereby irrevocably waives the
right to direct the application of any and all payments in respect of the
Finance Obligations and any Proceeds of Collateral after the occurrence and
during the continuance of an Event of Default, and agrees that, notwithstanding
the provisions of Section 2.09(b)(vi) and paragraph (a) above,
the Administrative Agent may, and (upon either (i) the written direction of the
Required Lenders or (ii) acceleration of the Senior Credit Obligations pursuant
to Section 8.02), shall apply all payments in respect of any Finance
Obligation, all funds in any Prepayment Account or other cash collateral account
and all other Proceeds of Collateral according to Section 8.03 hereof.

ARTICLE
III

TAXES, YIELD PROTECTION AND ILLEGALITY

Section 3.01 
Taxes.

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

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(b)           Other Taxes.  In addition, the Borrower agrees to pay any
and all present or future stamp, court or documentary taxes and any other
excise or property taxes or charges or similar levies (including mortgage
recording taxes) which arise from any payment made under any Loan Document or
from the execution, delivery, performance, enforcement or registration of, or
otherwise with respect to, any Loan Document (hereinafter referred to as “Other
Taxes”).

(c)           Gross-Up.  If the Borrower shall be required to deduct
or pay any Taxes or Other Taxes from or in respect of any sum payable under any
Loan Document to the Administrative Agent or any Lender, the Borrower shall
also pay to the Administrative Agent or to such Lender, as the case may be, at
the time interest is paid, such additional amount that the Administrative Agent
or such Lender specifies is necessary to preserve the after-tax yield (after
factoring in all taxes, including taxes imposed on or measured by net income)
that the Administrative Agent or such Lender would have received if such Taxes or
Other Taxes had not been imposed.

(d)           Borrower Indemnification.  The Borrower agrees to indemnify the
Administrative Agent and each Lender for (i) the full amount of Taxes and Other
Taxes (including any Taxes or Other Taxes imposed or asserted by any jurisdiction
on amounts payable under this Section) paid by the Administrative Agent and
such Lender, (ii) amounts payable under Section 3.01(c) and (iii) any
liability (including additions to tax, penalties, interest and expenses)
arising therefrom or with respect thereto, in each case whether or not such
Taxes or Other Taxes were correctly or legally imposed or asserted by the
relevant Governmental Authority.  Payment
under this subsection (d) shall be made within 30 days after the date
the Lender or the Administrative Agent makes a demand therefor.

(e)           Certain Recoveries.  If the Agent or any Lender determines, in its
sole discretion, that it has received a refund of any Taxes as to which it has
been indemnified by the Borrower or with respect to which the Borrower has paid
additional amounts pursuant to this Section 3.01, it shall pay to the
Borrower an amount equal to such refund (but only to the extent of indemnity
payments made, or additional amounts paid, by the Borrower under this Section
3.01 with respect to the Taxes giving rise to such refund), net of all
out-of-pocket expenses of the Agent or such Lender, as the case may be, and
without interest (other than interest paid by the relevant Governmental
Authority with respect to such refund); provided, however, that
the Borrower, upon the request of the Agent or such Lender, agrees to repay the
amount paid over to the Borrower (plus any penalties, interest or other charges
imposed by the relevant Governmental Authority) to the Agent or such Lender in
the event the Agent or such Lender is required to repay such refund to such
Governmental Authority.  This paragraph
(e) shall not be construed to require the Agent or any Lender to make
available its tax returns (or any other information relating to its taxes that
it deems confidential) to the Borrower or any other Person.

Section 3.02 
Illegality.  If,
on or after the date of this Agreement, the adoption of any applicable Law, or
any change in any applicable Law, or any change in the interpretation or
administration thereof by any Governmental Authority, central bank or
comparable agency charged with the interpretation or administration thereof, or
compliance by any Lender (or its Applicable Lending Office) with any request or
directive (whether or not having the force of Law) of any such authority,
central bank or comparable agency shall make it unlawful or impossible for any
Lender (or its Applicable Lending Office) to make, maintain or fund any of its
Eurodollar Loans and such Lender shall so notify the Administrative Agent, the
Administrative Agent shall forthwith give notice thereof to the other Lenders
and the Borrower, whereupon, until such Lender notifies the Borrower and the
Administrative Agent that the circumstances giving rise to such suspension no longer
exist, the obligation of such Lender to make Eurodollar Loans, or to convert
outstanding Loans into Eurodollar Loans, shall be suspended.  Before giving any notice to the
Administrative Agent pursuant to this Section 3.02, such Lender shall
designate a different Applicable Lending Office if such designation will avoid
the need for giving such notice and will not, in the judgment of such Lender,
be otherwise disadvantageous to such Lender. 
If such notice is

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given, each Eurodollar Loan of such Lender then outstanding shall be
converted to a Base Rate Loan either (i) on the last day of the then current
Interest Period applicable to such Eurodollar Loan, if such Lender may lawfully
continue to maintain and fund such Loan to such day or (ii) immediately, if
such Lender shall determine that it may not lawfully continue to maintain and
fund such Loan to such day.

Section 3.03 
Inability to Determine
Rates.  If on or prior to the first
day of any Interest Period for any Eurodollar Loan:

(i)            the Administrative Agent
determines (which determination shall be conclusive) that by reason of
circumstances affecting the relevant market, adequate and reasonable means do
not exist for ascertaining the applicable Eurodollar Rate for such Interest
Period; or

(ii)           Lenders having 50%
or more of the aggregate amount of the Commitments advise the Administrative
Agent that the London Interbank Offered Rate as determined by the
Administrative Agent will not adequately and fairly reflect the cost to such
Lenders of funding their Eurodollar Loans for such Interest Period;

the Administrative Agent shall forthwith give notice thereof to the
Borrower and the Lenders, whereupon, until the Administrative Agent notifies
the Borrower that the circumstances giving rise to such suspension no longer
exist, (i) the obligations of the Lenders to make Eurodollar Loans, or to
continue or convert outstanding Loans as or into Eurodollar Loans, shall be
suspended and (ii) each outstanding Eurodollar Loan shall be converted into a
Base Rate Loan on the last day of the then current Interest Period applicable
thereto.  Unless the Borrower notifies
the Administrative Agent at least two Business Days before the date of any
Eurodollar Borrowing for which a Notice of Borrowing has previously been given
that it elects not to borrow on such date, such Borrowing shall instead be made
as a Base Rate Borrowing in the same aggregate amount as the requested
Borrowing and shall bear interest for each day from and including the first day
to but excluding the last day of the Interest Period applicable thereto at the
rate applicable to Revolving Base Rate Loans for such day.

Section 3.04 
Increased Costs and Reduced Return; Capital Adequacy.

(a)           If
on or after the date hereof, the adoption of or any change in any applicable
Law or in the interpretation or application thereof applicable to any Lender
(or its Applicable Lending Office), or compliance by any Lender (or its
Applicable Lending Office) with any request or directive (whether or not having
the force of Law) from any central bank or other Governmental Authority, in
each case made subsequent to the Effective Date (or, if later, the date on
which such Lender becomes a Lender):

(i)            shall subject such
Lender (or its Applicable Lending Office) to any tax of any kind whatsoever
with respect to any Letter of Credit, any Eurodollar Loans made by it or any of
its Notes or its obligation to make Eurodollar Loans or to participate in
Letters of Credit, or change the basis of taxation of payments to such Lender
(or its Applicable Lending Office) in respect thereof (except for (A) Taxes and
Other Taxes covered by Section 3.01 (including Taxes imposed solely by
reason of any failure of such Lender to comply with its obligations under Section
10.15) and (B) changes in taxes measured by or imposed upon the overall net
income, or franchise tax (imposed in lieu of such net income tax), of such
Lender or its Applicable Lending Office, branch or any affiliate thereof));

(ii)           shall impose,
modify or hold applicable any reserve, special deposit, compulsory loan or
similar requirement against assets held by, deposits or other liabilities in or

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for the
account of, advances, loans or other extensions of credit by, or any other
acquisition of funds by, any office of such Lender (or its Applicable Lending
Office) which is not otherwise included in the determination of the Eurodollar
Rate hereunder; or

(iii)          shall impose on
such Lender (or its Applicable Lending Office) any other condition (excluding
any tax of any kind whatsoever);

and the result of any of the foregoing is to increase the cost to such
Lender (or its Applicable Lending Office) of making, converting into,
continuing or maintaining any Eurodollar Loans or issuing or participating in
Letters of Credit or to reduce any amount receivable hereunder in respect
thereof, then, in any such case, upon notice to the Borrower from such Lender,
through the Administrative Agent, in accordance herewith, the Borrower shall be
obligated to promptly pay such Lender, upon its demand, any additional amounts
necessary to compensate such Lender on an after-tax basis (after taking into
account applicable deductions and credits in respect of the amount indemnified)
for such increased cost or reduced amount receivable.  Each Lender will promptly notify the Borrower
and the Administrative Agent of any event of which it has knowledge, occurring
after the date hereof, which will entitle such Lender to compensation pursuant
to this Section and will designate a different lending office if such
designation will avoid the need for, or reduce the amount of, such compensation
and will not, in the judgment of such Lender, be otherwise disadvantageous to
such Lender.

(b)           If
any Lender shall have determined that the adoption or the becoming effective
of, or any change in, or any change by any Governmental Authority, central bank
or comparable agency charged with the interpretation or administration thereof
in the interpretation or administration of, any applicable Law regarding
capital adequacy, or compliance by such Lender, or its parent corporation, with
any request or directive regarding capital adequacy (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 parent corporation’s) capital or assets as a consequence of its
commitments or obligations hereunder to a level below that which such Lender,
or its parent corporation, could have achieved but for such adoption,
effectiveness, change or compliance (taking into consideration such Lender’s
(or parent corporation’s) policies with respect to capital adequacy), then,
upon notice from such Lender to the Borrower, the Borrower shall be obligated
to pay to such Lender such additional amount or amounts as will compensate such
Lender on an after-tax basis (after taking into account applicable deductions
and credits in respect of the amount indemnified) for such reduction; provided
that the Borrower shall not be required to compensate any Lender pursuant to subsection
(a) above or this subsection (b) for any additional costs or
reductions suffered more than 180 days prior to the date such Lender notifies
the Borrower of the circumstances giving rise to such additional costs or
reductions and of such Lender’s intentions to claim compensation therefor, and
provided further that, if the change in Law or in the interpretation or
administration thereof giving rise to such additional costs or reductions is
retroactive, then the 180-day period referred to above shall be extended to
include the period of retroactive effect thereof.  Each determination by any such Lender of
amounts owing under this Section 3.04 shall, absent manifest error, be
conclusive and binding on the parties hereto.

(c)           A
certificate of each Lender setting forth in reasonable detail such amount or
amounts as shall be necessary to compensate such Lender or its holding company
as specified in subsection (a) or (b) above, as the case may be,
shall be delivered to the Borrower and shall be conclusive absent manifest
error.  The Borrower shall pay each
Lender or the L/C Issuer the amount shown as due on any such certificate
delivered by it within 10 Business Days after receipt of the same.

(d)           Promptly
after any Lender becomes aware of any circumstance that will, in its reasonable
judgment, result in a request for increased compensation pursuant to this Section
3.04, such Lender shall notify the Borrower thereof.  Failure on the part of any Lender so to
notify the Borrower or

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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 right to demand
compensation with respect to such period or any other period, except as
expressly otherwise provided above.  The
protection of this Section 3.04 shall be available to each Lender
regardless of any possible contention of the invalidity or inapplicability of
the Law, rule, regulation, guideline or other change or condition which shall
have occurred or been imposed.

Section 3.05 
Funding Losses.  The Borrower shall indemnify each Lender
against any loss or expense (but excluding in any event loss of anticipated
profit) which such Lender may sustain or incur as a consequence of (i) any
failure by any Borrower to fulfill on the date of any Borrowing hereunder the
applicable conditions set forth in Article IV, (ii) any failure by the
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 2.02 or 2.07, (iii) any payment, prepayment
or conversion of a Eurodollar Loan, whether voluntary or involuntary, pursuant
to any other provision of this Agreement or otherwise made on a date other than
the last day of the Interest Period applicable thereto, (iv) 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, by irrevocable notice of prepayment or otherwise) or (v) the
assignment of any Eurodollar Loan other than on the last day of the Interest
Period applicable thereto as a result of a request by the Borrower pursuant to Section
2.10(e), 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. 
Such loss or reasonable expense shall include an amount equal to the
excess, if any, as reasonably determined by such Lender, of (i) its cost of
obtaining the funds for the Loan being paid, prepaid, converted, not borrowed
or assigned (based on the applicable London Interbank Offered Rate), for the
period from the date of such payment, prepayment, conversion, failure to
borrow, convert or continue to the last day of the Interest Period for such
Loan (or, in the case of a failure to borrow, the Interest Period for such Loan
which would have commenced on the date of such failure to borrow, convert or
continue) or assignment over (ii) 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, not borrowed, converted or continued for
such period or Interest Period or assignment, as the case may be.  A certificate of any Lender setting forth any
amount or amounts which such Lender is entitled to receive pursuant to this Section
3.05 shall be delivered to the Borrower and shall be conclusive absent
manifest error.

Section 3.06 
Base Rate Loans
Substituted for Affected Eurodollar Loans.  If (i) the obligation of
any Lender to make, or to continue or convert outstanding Loans as or to,
Eurodollar Loans has been suspended pursuant to Section 3.02 or (ii) any
Lender has demanded compensation under Section 3.01 or 3.04 with
respect to its Eurodollar Loans, and in any such case the Borrower shall, by at
least five Business Days’ prior notice to such Lender through the
Administrative Agent, have elected that the provisions of this Section 3.06
shall apply to such Lender, then, unless and until such Lender notifies the
Borrower that the circumstances giving rise to such suspension or demand for
compensation no longer exist, all Loans which would otherwise be made by such
Lender as (or continued as or converted to) Eurodollar Loans shall instead be
Base Rate Loans (on which interest and principal shall be payable
contemporaneously with the related Eurodollar Loans of the other Lenders).  If such Lender notifies the Borrower that the
circumstances giving rise to such suspension or demand for compensation no
longer exist, the principal amount of each such Base Rate Loan shall be
converted into a Eurodollar Loan on the first day of the next succeeding
Interest Period applicable to the related Eurodollar Loans of the other
Lenders.

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

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ARTICLE
IV

CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

Section 4.01 
Conditions to Initial
Credit Extension.
 The obligation of each Lender to
make a Loan or issue a Letter of Credit on the Closing Date is subject to the
satisfaction of the following conditions:

(a)           Executed Loan Documents.  Receipt by the Administrative Agent of duly
executed copies of:  (i) this Agreement;
(ii) the Notes; (iii) the Guaranty; (iv) the Collateral Documents and (v) all
other Loan Documents, each in form and substance reasonably satisfactory to the
Administrative Agent and the Syndication Agent.

(b)           Legal Matters.  All legal matters incident to this Agreement
and the borrowings hereunder shall be reasonably satisfactory to the
Administrative Agent, the Syndication Agent and to Fried Frank Harris Shriver
& Jacobson, LLP, counsel for the Administrative Agent.

(c)           Organization Documents.  The Administrative Agent shall have received:
(i) a copy of the Organization Documents, including all amendments thereto, of
each Loan Party, certified as of a recent date by the Secretary of State or
other applicable Governmental Authority of its respective jurisdiction of
organization; (ii) a certificate as to the good standing of each Loan Party, as
of a recent date, from the Secretary of State or other applicable authority of
its respective jurisdiction of organization and from each other state in which
such Loan Party is qualified or is required to be qualified to do business;
(iii) a certificate of the Secretary or Assistant Secretary of each Loan Party
dated the Closing Date and certifying (A) that the Organization Documents of
such Loan Party have not been amended since the date of the last amendment
thereto shown on the certificate of good standing from its jurisdiction of
organization furnished pursuant to clause (ii) above; (B) that attached
thereto is a true and complete copy of the agreement of limited partnership,
operating agreement or by-laws of such Loan Party, as applicable, as in effect
on the Closing Date and at all times since a date prior to the date of the
resolutions described in clause (C) below, (C) that attached thereto is
a true and complete copy of resolutions duly adopted by the board of directors
or other governing body of such Loan Party authorizing the execution, delivery
and performance of the Loan Documents to which it is to be a party and, in the
case of the Borrower, the borrowings hereunder, and that such resolutions have
not been modified, rescinded or amended and are in full force and effect; and
(D) as to the incumbency and specimen signature of each officer executing any
Loan Document; (iv) a certificate of another officer as to the incumbency and
specimen signature of the Secretary or Assistant Secretary executing the
certificate pursuant to clause (iii) above; and (v) such other corporate
or other constitutive or organizational documents as the Administrative Agent,
the Syndication Agent or Fried, Frank, Harris, Shriver & Jacobson LLP,
counsel for the Administrative Agent, may reasonably request.

(d)           Officer’s Certificates.  The Administrative Agent shall have received
(i) a certificate, dated the Closing Date and signed by a Responsible
Officer of each of Holdings and the Borrower, confirming compliance with the
conditions precedent set forth in paragraphs (b) and (c) of Section
4.04 and (ii) a certificate, dated the Closing Date and signed by a
Responsible Officer of each other Loan Party, confirming compliance with the
condition precedent set forth in paragraph (b) of Section 4.04.

(e)           Opinions of Counsel.  On the Closing Date, the Administrative Agent
shall have received a favorable written opinion of Sullivan & Cromwell LLP,
special counsel to the Loan Parties, addressed to the Administrative Agent, the
Collateral Agent and each Lender, dated the Closing Date, substantially in the
form of Exhibit E hereto and covering such additional matters incident
to the 

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transactions contemplated hereby as the Administrative Agent or the
Syndication Agent may reasonably request.

(f)            Capitalization.  The Administrative Agent and the Syndication
Agent shall be satisfied in their reasonable judgment that Parent Holdings owns
all of the issued and outstanding shares of capital stock of Holdings, that
Holdings owns all of the issued and outstanding shares of capital stock of the Borrower
and that the Borrower or one or more Wholly-Owned Subsidiaries owns all of the
issued and outstanding shares of capital stock of, each of the Borrower’s
Subsidiaries, in each case free of any Lien, charge or encumbrance not
permitted hereunder and the Organization Documents of each Loan Party.

(g)           Refinancing of Certain Existing Indebtedness; Other
Indebtedness.  On the
Closing Date, the commitments under all Refinanced Agreements shall have been
terminated, the Refinancing shall have been consummated and all loans
outstanding under the Refinanced Agreements shall have been repaid in full
(other than contingent indemnification obligations not yet due and payable),
together with accrued interest thereon (including, without limitation, any
prepayment premium), all letters of credit issued thereunder shall have been
terminated, backstopped through the issuance of Letters of Credit hereunder or
cash collateralized or shall have become Letters of Credit hereunder and all
other amounts owing pursuant to each Refinanced Agreement shall have been
repaid in full, and the Administrative Agent shall have received evidence in
form, scope and substance reasonably satisfactory to it that the matters set
forth in this subsection (g) have been satisfied at such time.  In addition, on the Closing Date, the
creditors under each Refinanced Agreement shall have terminated and released
all applicable Liens on the capital stock of and assets owned by the Borrower
and its Subsidiaries, and the Administrative Agent shall have received all such
releases as may have been requested by the Administrative Agent or the
Syndication Agent, which releases shall be in form and substance reasonably
satisfactory to the Administrative Agent and the Syndication Agent.

(h)           Perfection of Personal Property Security Interests
and Pledges; Search Reports. 
On or prior to the Closing Date, the Administrative Agent shall have
received:

(i)            a Perfection
Certificate from each Loan Party;

(ii)           appropriate
financing statements (Form UCC-1 or such other financing statements or similar
notices as shall be required by local Law) authenticated and authorized for
filing under the Uniform Commercial Code or other applicable local law of each
jurisdiction in which the filing of a financing statement or giving of notice
may be required, or reasonably requested by the Administrative Agent or the
Syndication Agent, to perfect the security interests intended to be created by
the Collateral Documents;

(iii)          copies of reports
from CT Corporation or another independent search service reasonably
satisfactory to the Collateral Agent listing all effective financing
statements, notices of tax, PBGC or judgment liens or similar notices that name
the Borrower, any other Loan Party, as such (under its present name and any previous
name and, if requested by the Administrative Agent or the Syndication Agent,
under any trade names), as debtor or seller that are filed in the jurisdictions
referred to in clause (ii) above or in any other jurisdiction having
files which must be searched in order to determine fully the existence of the
Uniform Commercial Code security interests, notices of the filing of federal
tax Liens (filed pursuant to Section 6323 of the Code), Liens of the PBGC
(filed pursuant to Section 4068 of ERISA) or judgment Liens on any Collateral,
together with copies of such financing statements, notices of tax, PBGC or
judgment Liens or similar notices (none of which shall cover the Collateral
except to the extent evidencing Permitted Liens or for which the Administrative
Agent shall have received 

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termination
statements (Form UCC-3 or such other termination statements as shall be
required by local Law) authenticated and authorized for filing);

(iv)          searches of
ownership of intellectual property in the appropriate governmental offices and
such patent, trademark and/or copyright filings as may be requested by the
Collateral Agent to the extent necessary or reasonably advisable to perfect the
Collateral Agent’s security interests in intellectual property Collateral;

(v)           all of the Pledged
Collateral, which Pledged Collateral shall be in suitable form for transfer by
delivery, or shall be accompanied by duly executed instruments of transfer or
assignment in blank, with signatures appropriately guaranteed, accompanied in
each case by any required transfer tax stamps, all in form and substance
reasonably satisfactory to the Administrative Agent and the Collateral Agent;
and

(vi)          evidence of the
completion of all other filings and recordings of or with respect to the
Collateral Documents and of all other actions as may be necessary or, in the
opinion of the Administrative Agent or the Syndication Agent, desirable to
perfect the security interests intended to be created by the Collateral
Documents.

(i)            Evidence of Insurance.  Receipt by the Administrative Agent of copies
of insurance policies or certificates of insurance of the Loan Parties and
their Subsidiaries evidencing liability and casualty insurance meeting the
requirements set forth in the Loan Documents, including, but not limited to,
naming the Collateral Agent as additional insured and loss payee on behalf of
the Lenders.

(j)            Consents and Approvals.  On the Closing Date, all necessary
governmental (domestic or foreign), regulatory and material third party
approvals in connection with the Transaction shall have been obtained and
remain in full force and effect, and all applicable waiting periods shall have
expired, in each case without any action being taken by any authority that
could restrain, prevent or impose any material adverse conditions on any of the
Group Companies or the Transaction or that could seek to restrain or threaten
any of the foregoing, and no Law shall be applicable which in the reasonable
judgment of the Administrative Agent and the Syndication Agent could have such
effect.

(k)           Litigation; Judgments.  On the Closing Date, there shall be no
action, suit, investigation or proceeding pending or, to the knowledge of any
of the Group Companies, threatened that in any case, either individually or in
the aggregate, has had, or could reasonably be expected to have, a Material
Adverse Effect or that seeks to restrain or enjoin the Transaction.

(l)            Material Adverse Effect.  There shall have been no change, occurrence
or development since October 31, 2005 that in any case, either individually or
in the aggregate, has had, or could reasonably be expected to have, a Material
Adverse Effect

(m)          Payment of Fees.  All costs, fees and expenses due to the
Administrative Agent, the Syndication Agent, the Collateral Agent and the
Lenders on or before the Closing Date shall have been paid.

(n)           Counsel Fees.  The Administrative Agent shall have received
full payment from the Borrower of all Attorney Costs of the Administrative
Agent to the extent invoiced prior to or on the Closing Date, plus such
additional amounts of Attorney Costs as shall constitute its reasonable
estimate of Attorney Costs incurred or to be incurred by it through the closing
proceedings (provided that such estimate shall not thereafter preclude a
final settling of accounts between the Borrower and the Administrative Agent).

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(o)           Revolving Availability.  After giving effect to all Credit Extensions
occurring on the Closing Date, the aggregate unused Revolving Commitments shall
exceed the aggregate amount of all Revolving Outstandings by at least
$40,000,000.

The documents referred to
in this Section 4.01 shall be delivered to the Administrative Agent no
later than the Closing Date.  The
certificates and opinions referred to in this Section 4.01 shall be
dated the Closing Date.

Section 4.02 
Determination of
Conditions to Initial Credit Extension.  For purposes of determining compliance with
the conditions specified in Section 4.01, each Lender shall be deemed to
have consented to, approved, accepted or be satisfied with, each document or
other matter required hereunder to be consented to or approved by or acceptable
or satisfactory to the Lenders unless an officer of the Administrative Agent
responsible for the transactions contemplated by the Loan Documents shall have
received notice from such Lender prior to the initial Borrowing hereunder
specifying its objection thereto and such Lender shall not have made available
to the Administrative Agent such Lender’s ratable share of such Borrowing.

Promptly after the Closing
Date occurs, the Administrative Agent shall notify the Borrower and the Lenders
of the Closing Date, and such notice shall be conclusive and binding on all
parties hereto.

Section 4.03 
Conditions to Credit
Extension to Fund Cash Merger Consideration.   The obligation of each Lender to make a Loan
the proceeds of which will be used to fund payment of the cash portion of the
consideration payable for Lipman capital stock under the Merger Agreement is
subject to the satisfaction of the following conditions:

(a)           Consummation of the Merger.  There shall have been delivered to the
Administrative Agent true and correct copies of the final Merger Documents,
certified as such by an appropriate officer of the Borrower.  Not later than 11:59 PM (local time in Tel
Aviv, Israel) on the third New York Business Day after the date of the initial
Term B Borrowing, the Merger shall have been consummated in accordance with the
Merger Documents (without giving effect to any amendment or modification
thereof or waiver with respect thereto, including, but not limited to, any
modification, amendment, supplement or waiver relating to any disclosure
schedule or exhibit, unless consented to by the Administrative Agent) and in
accordance with all applicable Laws.

(b)           Certificate of Merger.  On the Closing Date, the Registrar of
Companies of the State of Israel shall have issued a certificate evidencing the
completion of the Merger in accordance with Section 323(5) of the Israeli
Companies Law.

Section 4.04 
Conditions to All Credit
Extensions.   The obligation of any Lender to make a Loan on
the occasion of any Borrowing, and the obligation of any L/C Issuer to issue
(or renew or extend the term of) any Letter of Credit, is subject to the
satisfaction of the following conditions:

(a)           Notice.  The Borrower shall have delivered (i) in the
case of any Revolving or Term Loan, to the Administrative Agent, an appropriate
Notice of Borrowing, duly executed and completed, by the time specified in, and
otherwise as permitted by, Section 2.02, (ii) in the case of any Letter
of Credit, to the L/C Issuer, an appropriate Letter of Credit Request duly
executed and completed in accordance with the provisions of Section 2.05,
and (iii) in the case of any Swing Line Loan, to the Swing Line Lender, a Swing
Line Loan Request, duly executed and completed, by the time specified in Section
2.02.

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(b)           Representations and Warranties.  The representations and warranties made by
the Loan Parties in any Loan Document are true and correct in all material
respects at and as if made as of such date except to the extent they expressly
relate to an earlier date.

(c)           No Default.  No Default or Event of Default shall exist or
be continuing either prior to or after giving effect thereto.

(d)           Availability.  Immediately after giving effect to the making
of a Revolving Loan (and the application of the proceeds thereof) or to the
issuance of a Letter of Credit, as the case may be, (i) the sum of the
Revolving Loans outstanding plus all L/C Obligations outstanding plus all Swing
Line Loans outstanding shall not exceed the Revolving Committed Amount, (ii)
the sum of L/C Obligations outstanding shall not exceed the L/C Sublimit and
(iii) the sum of all Swing Line Loans outstanding shall not exceed the Swing
Line Committed Amount.

The delivery of each
Notice of Borrowing, Swing Line Loan Request and each Letter of Credit Request
shall constitute a representation and warranty by the Loan Parties of the
correctness of the matters specified in subsections (b), (c) and (d)
above.

Section 4.05 
Conditions Precedent to
Facilities Increase.  No Facilities Increase shall become effective
prior to the satisfaction of all of the following conditions precedent:

(a)           Certain Documents. The Administrative
Agent shall have received on or prior to the Facilities Increase Date for such
Facilities Increase each of the following, each dated such Facilities Increase
Date unless otherwise indicated or agreed to by the Administrative Agent and
each in form and substance reasonably satisfactory to the Administrative Agent:

(i)            written commitments
duly executed by existing Lenders (or their Affiliates or Approved Funds) or
Eligible Assignees in an aggregate amount equal to the amount of the proposed
Facilities Increase (as agreed between the Borrower and the Administrative
Agent but in any case not to exceed, in the aggregate for all such Facilities
Increases, the maximum amount set forth in Section 2.10(a)) and, in the
case of each such Eligible Assignee or Affiliate or Approved Fund that is not
an existing Lender, an Assignment and Assumption in form and substance
reasonably satisfactory to the Administrative Agent and duly executed by the
Borrower, the Administrative Agent and such Affiliate, Approved Fund or
Eligible Assignee;

(ii)           an amendment to
this Agreement (including to Schedule 2.01), effective as of the
Facilities Increase Date and executed by the Borrower and the Administrative
Agent, to the extent necessary to implement terms and conditions of the
Facilities Increase (including interest rates, fees and scheduled repayment
dates and maturity), as agreed by the Borrower and the Administrative Agent
but, which, in any case, except for interest, fees, scheduled repayment dates
and maturity, shall not be applied materially differently to the Facilities Increase
and the Revolving Loans and Term B Loans outstanding immediately prior to the
Facilities Increase;

(iii)          certified copies of
resolutions of the Board of Directors of each Loan Party approving the
consummation of such Facilities Increase and the execution, delivery and
performance of the corresponding amendments to this Agreement and the other
documents to be executed in connection therewith;

(iv)          a favorable opinion
of counsel for the Loan Parties, addressed to the Administrative Agent and the
Lenders and in form and substance and from counsel reasonably satisfactory to
the Administrative Agent; and

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(v)           such other documents
as the Administrative Agent may reasonably request or as any Lender
participating in such Facilities Increase may require as a condition to its
commitment in such Facilities Increase.

(b)           Fees and Expenses Paid.  There shall have been paid to the
Administrative Agent, for the account of the Administrative Agent and the
Lenders (including any Person becoming a Lender as part of such Facilities
Increase on such Facilities Increase Date), as applicable, all fees and
expenses (including reasonable Attorney Costs) due and payable on or before the
Facilities Increase Date.

(c)           Conditions to Each Loan and Letter of Credit.  (i) The conditions precedent set forth in Section
4.04 shall have been satisfied both before and after giving effect to such
Facilities Increase, (ii) such Facilities Increase shall be made on the terms
and conditions set forth in Section 2.10(a) and (iii) the Borrower shall
be in compliance with Section 7.17 on such Facilities Increase Date for
the most recently ended fiscal quarter on a Pro-Forma Basis both before and
after giving effect to such Facilities Increase.

(d)           Yield Maintenance.  (i) The “all-in yield” of such Facilities
Increase for the Term B Commitments or Revolving Commitments shall not exceed
such “all-in yield” (on a “marked-to-market” basis) for the Term B Loans or
Revolving Credit Loans outstanding on the Facilities Increase Date (after
giving effect to any increase in the Applicable Margin applicable to the
existing Term B Loans and Revolving Credit Loans becoming effective on the
Facilities Increase Date) and (ii) as of such Facilities Increase Date, the
Weighted Average Life to Maturity of such Facilities Increase for the Term B
Loans or Revolving Credit Loans shall not be shorter than the remaining
Weighted Average Life to Maturity for the Term B Loans or Revolving Credit
Loans outstanding immediately prior to such Facilities Increase.

ARTICLE V

REPRESENTATIONS AND WARRANTIES

Each of Holdings and the Borrower represents and
warrants to the Administrative Agent and the Lenders that:

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

Section 5.02 
Authorization; No
Contravention.  The execution, delivery and performance by
each Loan Party of each Loan Document to which such Person is party have been
duly authorized by all necessary corporate, partnership, limited liability
company or other organizational action, and do not and will not (i) contravene
the terms of any of such Person’s Organization Documents, (ii) conflict with or
result in any breach or contravention of, or the creation of any Lien under,
any Contractual Obligation to which such Person is a party or any order,
injunction, writ or decree of any Governmental Authority or any arbitral award
to which such Person or its property is subject or (iii) 

 81
 

 

violate any Law, except in any case for such violations which could not
reasonably be expected, individually or in the aggregate, to have a Material
Adverse Effect.

Section 5.03 
Governmental
Authorization; Other Consents.  Except for filings necessary to perfect the
Liens in favor of the Collateral Agent in the Collateral and to release Liens
in respect of the Refinanced Agreements and other consents, authorizations,
notices, approvals and exemptions that have been obtained prior to or as of the
Closing Date, no approval, consent, exemption, authorization, or other action
by, or notice to, or filing with, any Governmental Authority or any other
Person is necessary or required in connection with the execution, delivery or
performance by, or enforcement against, any Loan Party of this Agreement or any
other Loan Document to which it is a party.

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

Section 5.05 
Financial Condition; No Material Adverse Effect.

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

(b)           Interim Financial Statements.  The unaudited condensed consolidated balance
sheet of Parent Holdings and its Consolidated Subsidiaries as of July 31, 2006
and the related unaudited consolidated statements of income and cash flows for
the fiscal quarter and the then elapsed portion of the fiscal year then ended
which are included in Parent Holdings’ Quarterly Report on Form 10-Q for the
three months ended July 31, 2006, as filed with the SEC, fairly present, in all
material respects and in conformity with GAAP applied on a basis consistent with
the financial statements referred to in subsection (a) of this Section
5.05 (except that footnotes have been presented in accordance with Article
10 of Regulation S-X promulgated under the Exchange Act and normal year-end
audit adjustments), the consolidated financial position of Parent Holdings and
its Consolidated Subsidiaries as of such date and their consolidated results of
operations for such periods and cash flows for the nine-month period ended July
31, 2006 (subject in each case to normal year-end audit adjustments).  During the period from July 31, 2006 to and
including the Closing Date, except as set forth on Schedule 5.05, there
has been no sale, transfer or other disposition by Parent Holdings or any of
its Consolidated Subsidiaries of any material part of the business or property
(other than sales of inventory in the ordinary course of business) of Parent
Holdings and its Consolidated Subsidiaries, taken as a whole, and no purchase
or other acquisition by them of any business or property (including any Equity
Interests of any other Person) other than the Merger material in relation to
the consolidated financial condition of Parent Holdings and its 

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Consolidated Subsidiaries, taken as a whole, which is not reflected in
the foregoing financial statements or in the notes thereto.

(c)           Material Adverse Change.  Since October 31, 2005, there has been no
change, occurrence or development either individually or in the aggregate, that
has had or could reasonably be expected to have a Material Adverse Effect.

(d)           Pro-Forma Balance Sheet.  The consolidated balance sheet of Parent
Holdings and its Consolidated Subsidiaries as of April 30, 2006, prepared on a
Pro-Forma Basis giving effect to the consummation of the Transaction, has
heretofore been furnished to each Lender as part of the Pre-Commitment
Information.  Such Pro-Forma balance
sheet has been prepared in good faith by the Borrower, based on the assumptions
stated therein (which assumptions are believed by the Borrower on the date
hereof and on the Closing Date to be reasonable and fair in light of current
conditions and facts then known to the Borrower), is based on the best
information available to the Borrower as of the date of delivery thereof,
accurately reflects all material adjustments required to be made to give effect
to the Transaction and presents fairly on a Pro-Forma basis the estimated
consolidated financial position of Parent Holdings and its Consolidated
Subsidiaries as of April 30, 2006 assuming that the Transaction had actually
occurred on that date.

(e)           Projections.  The projections prepared as part of, and
included in, the Pre-Commitment Information (which include projected balance
sheets and income and cash flow statements on a quarterly basis through October
31, 2007 and on an annual basis for each fiscal year thereafter until the
respective Maturity Dates of the Loans) have been prepared on a basis
consistent with the financial statements referred to in subsection (a)
above and are based on good faith estimates and assumptions stated therein made
by management of the Borrower (which assumptions are fair in light of then
existing conditions).  On the Closing
Date, such management believes that such projections are reasonable and
attainable, it being recognized by the Lenders, however, that projections as to
future events are not to be viewed as facts and that actual results during the
period or periods covered by such projections may differ from the projected
results and that such differences may be material.

(f)            Post-Closing Financial Statements.  The financial statements delivered to the
Lenders pursuant to Section 6.01(a) and (b), if any, (i) have
been prepared in accordance with GAAP (except as may otherwise be permitted
under Section 6.01(a) and (b)) and (ii) present fairly (on the
basis disclosed in the footnotes to such financial statements, if any) in all
material respects the consolidated financial condition, results of operations
and cash flows of Parent Holdings and its Consolidated Subsidiaries as of the
respective dates thereof and for the respective periods covered thereby.

(g)           No Undisclosed Liabilities.  Except as fully reflected in the financial
statements described in subsection (a) and (b) above, for items
disclosed on Schedule 5.05 or Schedule 7.01 hereof and the Indebtedness
incurred under this Agreement, there were as of the Closing Date (and after
giving effect to any Loans made and Letters of Credit issued on such date), no
liabilities or obligations (excluding current obligations incurred in the
ordinary course of business) with respect to any Group Company of any nature
whatsoever (whether absolute, accrued, contingent or otherwise and whether or
not due and including obligations or liabilities for taxes, long-term leases
and unusual forward or other long-term commitments).

Section 5.06 
Litigation. 
Except as specifically disclosed in Schedule 5.06, there are no
actions, suits, investigations or legal, equitable, arbitration or
administrative proceedings pending or, to the knowledge of any Loan Party,
threatened against or affecting any Group Company in which there is a
reasonable possibility of an adverse decision that, if adversely determined,
could reasonably be expected to result in a Material Adverse Effect.

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Section 5.07 
No Default. 
No Group Company is in default under or with respect to any Contractual
Obligation that could reasonably be expected to have a Material Adverse
Effect.  No Default has occurred and is
continuing or would result from the consummation of the transactions
contemplated by this Agreement.

Section 5.08 
Ownership of Property;
Liens.  Each Group Company has good and marketable
title to, or valid leasehold interests in, all its material properties and
assets, except for Permitted Liens and minor defects in title that do not
interfere with its ability to conduct its business as currently conducted.  All such material properties and assets are
free and clear of Liens other than Permitted Liens.  Each Group Company has complied with all
obligations under all leases to which it is a party, other than those the
violation of which would not reasonably be expected to result in a Material
Adverse Effect, and all such leases are in full force and effect, other than
leases that, individually or in the aggregate, are not material to the Group
Companies, taken as a whole, and in respect of which the failure to be in full
force and effect will not result in a Material Adverse Effect.  Each Group Company enjoys peaceful and
undisturbed possession under all such leases with respect to which it is the
lessee, other than leases that, individually or in the aggregate, are not
material to the Group Companies, taken as a whole, and in respect of which the
failure to enjoy peaceful and undisturbed possession would not reasonably be
expected to result in a Material Adverse Effect.

Section 5.09 
Environmental Compliance.  No Group Company has failed to comply with
any Environmental Law or to obtain, maintain, or comply with any permit,
license or other approval required under any Environmental Law or is subject to
any Environmental Liability in any case which, individually or collectively,
could reasonably be expected to result in a Material Adverse Effect or has
received written notice of any claim with respect to any Environmental
Liability the subject of which notice could reasonably be expected to have a
Material Adverse Effect, and no Group Company knows of any basis for any
Environmental Liability against any Group Company that could reasonably be
expected to have a Material Adverse Effect.

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

Section 5.11 
Taxes. 
Each Group Company has filed, or caused to be filed, all material
federal, state, local and foreign tax returns required to be filed and paid (i)
all amounts of taxes shown thereon to be due (including interest and penalties)
and (ii) all other taxes, fees, assessments and other governmental charges
(including mortgage recording taxes, documentary stamp taxes and intangible
taxes) owing by it, except for such taxes (A) which are not yet delinquent or
(B) that are being contested in good faith and by proper proceedings diligently
pursued, and against which adequate reserves are being maintained in accordance
with GAAP.  No Loan Party knows of any
pending investigation of such party by any taxing authority or proposed tax
assessments against any Group Company that would, if made, have a Material
Adverse Effect.

Section 5.12 
ERISA; Foreign Pension
Plans; Employee Benefit Arrangements.  Except as disclosed in Schedule 5.12:

(a)           ERISA.

(i)            There are no
Unfunded Liabilities in excess of the Threshold Amount (A) with respect to
any member of the Group Companies and (B) with respect to any ERISA 

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Affiliate; provided
that for purposes of this Section 5.12(a)(i)(B) only, Unfunded
Liabilities shall mean the amount (if any) by which the projected benefit obligation
exceeds the value of the plan’s assets as of its last valuation date using the
actuarial assumptions and methods being used by the Plans’ actuaries for making
such determination.

(ii)           Each Plan, other
than a Multiemployer Plan, complies in all respects with the applicable
requirements of ERISA and the Code, and each Group Company complies in all
respects with the applicable requirements of ERISA and the Code with respect to
all Multiemployer Plans to which it contributes, except to the extent that the
failure to comply therewith would not reasonably be expected to have a Material
Adverse Effect.

(iii)          No ERISA Event has
occurred or, subject to the passage of time, is reasonably expected to occur
with respect to any Plan maintained by any member of the Group Companies and,
except to the extent that such ERISA Event would not reasonably be expected to
have a Material Adverse Effect, no ERISA Event has occurred or, subject to the
passage of time, is reasonably expected to occur with respect to any Plan maintained
by an ERISA Affiliate.

(iv)          No Group
Company:  (A) is or has been within the
last six years a party to any Multiemployer Plan; or (B) has completely or
partially withdrawn from any Multiemployer Plan.

(v)           If any Group Company
or any ERISA Affiliate were to incur a complete withdrawal (as described in
Section 4203 of ERISA) from any Multiemployer Plan as of the Closing Date, the
aggregate withdrawal liability, as determined under Section 4201 of ERISA, with
respect to all such Multiemployer Plans would not exceed $2,500,000.

(vi)          The execution and
delivery of this Agreement and the consummation of the transactions
contemplated hereunder will not involve any transaction that is subject to the
prohibitions of Section 406 of ERISA or in connection with which taxes could be
imposed pursuant to Section 4975(c)(1)(A)-(D) of the Code, for which an
exemption under ERISA does not apply.

(vii)         No Group Company has
any contingent liability with respect to any post-retirement benefit under a
Welfare Plan that could reasonably be expected to have a Material Adverse
Effect.

(b)           Foreign Pension Plans.  Each Foreign Pension Plan has been maintained
in material compliance with its terms and with the requirements of any and all
applicable Laws, statutes, rules, regulations and orders and has been
maintained, where required, in good standing with applicable regulatory
authorities except to the extent that the failure to comply therewith would not
reasonably be expected to have a Material Adverse Effect.  No Group Company has incurred any material
obligation in connection with the termination of or withdrawal from any Foreign
Pension Plan.

(c)           Employee Benefit Arrangements.

(i)            All liabilities
under the Employee Benefit Arrangements are (A) funded to at least the minimum
level required by Law or, if higher, to the level required by the terms
governing the Employee Benefit Arrangements, (B) insured with a reputable
insurance company, (C) provided for or recognized in the financial statements
most recently delivered to the Administrative Agent pursuant to Section 6.01
hereof or (D) estimated in the formal notes to the financial statements most
recently delivered to the Administrative Agent pursuant to Section 6.01 

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hereof, where
such failure to fund, insure provide for, recognize or estimate the liabilities
arising under such arrangements could reasonably be expected to have a Material
Adverse Effect.

(ii)           There are no
circumstances which may give rise to a liability in relation to the Employee
Benefit Arrangements which are not funded, insured, provided for, recognized or
estimated in the manner described in clause (i) above and which could
reasonably be expected to have a Material Adverse Effect.

(iii)          Each Group Company
is in material compliance with all applicable Laws, trust documentation and
contracts relating to the Employee Benefit Arrangements.

Section 5.13 
Subsidiaries. 
Schedule 5.13 sets forth a complete and accurate list as of the
Closing Date of all Subsidiaries of Holdings. 
Schedule 5.13 sets forth as of the Closing Date the jurisdiction
of formation of each such Subsidiary, whether each such Subsidiary is a
Subsidiary Guarantor, the number of authorized shares of each class of Equity
Interests of each such Subsidiary, the number of outstanding shares of each class
of Equity Interests, the number and percentage of outstanding shares of each
class of Equity Interests of each such Subsidiary owned (directly or
indirectly) by any Person and the number and effect, if exercised, of all
Equity Equivalents of each such Subsidiary. 
All the outstanding Equity Interests of each Subsidiary of Holdings are
validly issued, fully paid and non-assessable and were not issued in violation
of the preemptive rights of any shareholder and, as of the Closing Date, are
owned by Holdings, directly or indirectly, free and clear of all Liens (other
than those arising under the Collateral Documents).  Other than as set forth on Schedule 5.13,
as of the Closing Date, no such Subsidiary has outstanding any Equity
Equivalents nor does any such Person have outstanding any rights to subscribe
for or to purchase or any options for the purchase of, or any agreements
providing for the issuance (contingent or otherwise) of, or any calls,
commitments or claims of any character relating to, its Equity Interests.  Holdings has no Subsidiaries, other than the
Borrower and its Subsidiaries.

Section 5.14 
Margin Regulations; Investment Company Act.

(a)           None
of Holdings and its 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” within the meaning of
Regulation U.  No part of the
Letters of Credit or proceeds of the Loans will be used, directly or
indirectly, for the purpose of purchasing or carrying any “margin stock” within
the meaning of Regulation U.  If
requested by any Lender or the Administrative Agent, the Borrower will furnish
to the Administrative Agent and each Lender a statement to the foregoing effect
in conformity with the requirements of FR Form U-1 referred to in Regulation
U.  No indebtedness being reduced or
retired out of the proceeds of the Loans was or will be incurred for the
purpose of purchasing or carrying any “margin stock” within the meaning of
Regulation U or any “margin security” within the meaning of Regulation T.  “Margin stock” within the meaning of
Regulation U does not constitute more than 25% of the value of the consolidated
assets of Holdings and its Consolidated Subsidiaries.  None of the transactions contemplated by this
Agreement (including the direct or indirect use of the proceeds of the Loans)
will violate or result in a violation of the Securities Act, the Exchange Act
or Regulation T, U or X.

(b)           None
of the Group Companies is (i) an “investment company” registered or required to
be registered under the Investment Company Act of 1940, as amended or (ii)
controlled by such a company.

Section 5.15 
Disclosure. 
No written information or written data (excluding financial projections,
budgets, estimates and general market data) with respect to any Loan Party in
any Loan 

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Document or furnished to the Administrative Agent or any Lender by or
on behalf of any Loan Party in connection with any Loan Document, when taken as
a whole, contains any untrue statement of a material fact or omits any material
fact necessary to make the statements therein not materially misleading in
light of the circumstances under which such statements were made; provided
that (i) to the extent any such statement, information or report therein was
based upon or constitutes a forecast or projection, the Borrower represents
only that it acted in good faith and utilized assumptions believed by it to be
reasonable at the time made (it being understood and agreed that projections as
to future events are not to be viewed as facts or guaranties of future
performance, that actual results during the period or periods covered by such
projections may differ from the projects results and that such differences may
be material and that the Loan Parties make no representation that such
representations will in fact be realized) and (ii) as to statements,
information and reports specified as having been supplied by third parties,
other than Affiliates of the Borrower or any of its Subsidiaries, the Borrower
represents only that it is not aware of any material misstatement or omission
therein.

Section 5.16 
Compliance with Law.  Each Group Company is in compliance with all
requirements of Law (including Environmental Laws) applicable to it or to its
properties, except for any such failure to comply which could not reasonably be
expected to cause a Material Adverse Effect. 
To the knowledge of the Loan Parties, none of the Group Companies or any
of their respective material properties or assets is subject to or in default
with respect to any judgment, writ, injunction, decree or order of any court or
other Governmental Authority which, individually or in the aggregate, could
reasonably be expected to result in a Material Adverse Effect.  As of the Closing Date, except as disclosed
in Schedule 5.16, none of the Group Companies has received any written
communication from any Governmental Authority that alleges that any of the
Group Companies is not in compliance in any material respect with any Law,
except for allegations that have been satisfactorily resolved and are no longer
outstanding or which, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect.

Section 5.17 
Intellectual Property.  Except as set forth on Schedule 5.17,
the Borrower and its Subsidiaries own, or possess the right to use, all of the
trademarks, service marks, trade names, copyrights, patents, patent rights,
franchises, licenses and other rights that are reasonably necessary for the
operation of their respective businesses, without conflict with the rights of
any other Person except for those conflicts which could not reasonably be
expected to have a Material Adverse Effect. 
To the best knowledge of the Borrower, no slogan or other advertising
device, product, process, method, substance, part or other material now
employed, or now contemplated to be employed, by the Borrower or any Subsidiary
infringes in any material respect upon any rights held by any other Person.

Section 5.18 
Purpose of Loans and
Letters of Credit.  The proceeds of the Term B Loans and any
Revolving Loans made on the Closing Date and of any Term B Loans made after the
initial funding of the Term B Loans on the Closing Date and during the
Availability Period for Term B Loans will be used solely to effect the Merger
and the Refinancing and to pay fees and expenses incurred in connection with
the Transaction.  The proceeds of the
Revolving Loans, Swing Line Loans and any Term B Loans comprising part of a
Facilities Increase made after the Closing Date will be used solely to provide
for the working capital requirements of the Borrower and its Subsidiaries and
for the general corporate purposes of the Borrower and its Subsidiaries,
including Permitted Acquisitions.  The
Letters of Credit shall be used only for or in connection with appeal bonds,
reimbursement obligations arising in connection with surety and reclamation
bonds, reinsurance, domestic or international trade transactions and other
obligations relating to transactions entered into by the Borrower and its
Subsidiaries in the ordinary course of business.

Section 5.19 
Labor Matters.   There are no strikes against Holdings or any
of its Subsidiaries, other than any strikes that could not reasonably be
expected to result in a Material Adverse 

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Effect.  All payments due from
Holdings or any of its Subsidiaries, or for which any claim may be made against
Holdings or any of its Subsidiaries, on account of wages and employee health
and welfare insurance and other benefits have been paid or accrued as a
liability on the books of Holdings and its Subsidiaries, as applicable and
required under GAAP.  The consummation of
the Transaction 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 Holdings or any of its Subsidiaries is a party or by which
Holdings or any of its Subsidiaries (or any predecessor) is bound, other than
collective bargaining agreements which, individually or in the aggregate, are
not material to Holdings and its Subsidiaries taken as a whole.

Section 5.20 
Solvency.   The Loan Parties are and, after consummation
of the Transaction, will be Solvent.

Section 5.21 
Collateral Documents.

(a)           Article 9 Collateral.  Each of the Security Agreement and the Pledge
Agreement is effective to create in favor of the Collateral Agent, for the
ratable benefit of the holders from time to time of the Finance Obligations, a
legal, valid and enforceable First Priority Lien in the Collateral described
therein and, when financing statements in appropriate form are filed in the
offices specified on Schedule 4.01 to the Security Agreement and the
Pledged Collateral is delivered to the Collateral Agent, each of the Security
Agreement and the Pledge Agreement shall constitute a fully perfected First
Priority Lien on, and security interest in, all right, title and interest of
the grantors thereunder in such of the Collateral in which a security interest
can be perfected under Article 9 of the Uniform Commercial Code.

(b)           Intellectual Property.  When financing statements in the appropriate
form are filed in the offices specified on Schedule 4.01 to the Security
Agreement, the Patent and Trademark Agreement, substantially in the form of
Exhibit A to the Security Agreement, is filed in the United States Patent and
Trademark Office and the Copyright Agreement, substantially in the form of
Exhibit B to the Security Agreement, is filed in the United States Copyright
Office, the Security Agreement shall constitute a fully perfected First
Priority Lien on, and security interest in, all right, title and interest of
the grantors thereunder in the United States patents, trademarks, copyrights,
licenses and other intellectual property rights, and all registrations and applications
relating thereto, covered in such Patent and Trademark Agreement and Copyright
Agreement (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 patents, patent applications,
trademarks, trademark applications and registered copyrights acquired by the
Loan Parties after the Closing Date).

(c)           Status of Liens.  As of the Closing Date, no filings or
recordings are required in order to perfect the security interests created
under the Collateral Documents, except for filings or recordings listed on
Schedule 4.01 to the Security Agreement.

Section 5.22 
Ownership.

(a)           Securities of the Borrower.  Holdings owns good, valid and marketable
title to all the outstanding common stock of the Borrower, free and clear of
all Liens of every kind, whether absolute, matured, contingent or otherwise,
other than those arising under the Collateral Documents.  Except as set forth on Schedule 5.22,
as of the Closing Date there are no shareholder agreements or other agreements
pertaining to Holdings’ beneficial ownership of the common stock of the
Borrower, including any agreement that would restrict Holdings’ right to
dispose of such common stock and/or its right to vote such common stock.

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(b)           Holdings Equity Interests.  Parent Holdings owns good, valid and
marketable title to all the outstanding common stock of Holdings, free and
clear of all Liens of every kind, whether absolute, matured, contingent or
otherwise.

Section 5.23 
Certain Transactions.  Except as disclosed on Schedule 5.23,
no broker’s or finder’s fee or commission will be payable with respect to this
Agreement or any of the transactions contemplated hereby as a result of any
action by or on behalf of the Borrower or their Affiliates, and each of
Holdings and the Borrower hereby indemnifies each Agent and each Lender
against, and agrees that it will hold each Agent and each Lender harmless from,
any claim, demand or liability for any such broker’s or finder’s fees alleged
to have been incurred in connection herewith or therewith and any expenses
(including reasonable fees, expenses and disbursements of counsel) arising in
connection with any such claim, demand or liability.

ARTICLE
VI

AFFIRMATIVE COVENANTS

Each of Holdings and the
Borrower agrees that so long as any Lender has any Commitment hereunder, any
Senior Credit Obligation or other amount payable hereunder or under any Note or
other Loan Document or any L/C Obligation (in each case other than contingent
indemnification obligations) remains unpaid or any Letter of Credit remains in
effect:

Section 6.01 
Financial Statements.  The Borrower will furnish, or cause to be
furnished, to the Administrative Agent for further distribution to each of the
Lenders:

(a)           Annual Financial Statements.  As soon as available, and in any event within
90 days after the end of each fiscal year of Parent Holdings (commencing with
the fiscal year ending October 31, 2006), a consolidated balance sheet and
income statement of Parent Holdings and its Consolidated Subsidiaries, as of
the end of such fiscal year, and the related consolidated statement of
operations and retained earnings and consolidated statement of cash flows for
such fiscal year, setting forth in comparative form consolidated figures for
the preceding fiscal year, all such financial statements to be in reasonable
form and detail and audited by Parent Holdings’ registered independent public
accounting firm and accompanied by an opinion of such firm (which shall not be
qualified or limited in any material respect) to the effect that such
consolidated financial statements have been prepared in accordance with GAAP
and present fairly in all material respects the consolidated financial position
and consolidated results of operations and cash flows of Parent Holdings and
its Consolidated Subsidiaries in accordance with GAAP consistently applied
(except for changes with which such accountants concur).

(b)           Quarterly Financial Statements.  As soon as available, and in any event within
45 days after the end of each of the first three fiscal quarters in each fiscal
year of Parent Holdings (commencing with fiscal quarter ended January 31,
2007), a consolidated balance sheet of Parent Holdings and its Consolidated
Subsidiaries as of the end of such fiscal quarter, together with related
consolidated statement of operations and retained earnings and consolidated
statement of cash flows for such fiscal quarter and the then elapsed portion of
such fiscal year, setting forth in comparative form consolidated figures for
the corresponding periods of the preceding fiscal year, all such financial
statements to be in form and detail and reasonably acceptable to the
Administrative Agent, and accompanied by a certificate of the chief financial
officer of Parent Holdings to the effect that such quarterly financial
statements have been prepared in accordance with GAAP and present fairly in all
material respects the consolidated financial position and consolidated results
of operations and cash flows of Parent Holdings and its Consolidated
Subsidiaries in accordance with GAAP consistently applied, subject to changes
resulting from normal year-end audit adjustments and the absence of footnotes
required by GAAP.

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As to any information
contained in materials furnished pursuant to Section 6.02(d), the
Borrower shall not be separately required to furnish such information under Section
6.01(a) or (b), but the foregoing shall not be in derogation of the
obligation of the Borrower to furnish the information and materials described
in Section 6.01(a) or (b) at the times specified therein.

Section 6.02 
Certificates; Other
Information.  The Borrower will furnish, or cause to be
furnished, to the Administrative Agent for further distribution to each of the
Lenders, in form and detail reasonably satisfactory to them:

(a)           Auditors’ Certificate.  Concurrently with the delivery of the
financial statements referred to in Section 6.01(a), a certificate of
its registered independent public accounting firm certifying such financial
statements and (unless such accountants are prohibited by law or the Public
Company Accounting Oversight Board or the Financial Accounting Standards Board
(or any successor to either of such bodies) from providing such statement)
stating that in the course of the audit upon which their opinion on such
financial statements was based (but without any special or additional audit
procedures for the purpose), they obtained knowledge of no condition or event
relating to financial matters which constitutes a Default or an Event of
Default or, if such accountants shall have obtained in the course of such audit
knowledge of any such Default or Event of Default, disclosing in such written
statement the nature and period of existence thereof, it being understood that
such accountants shall be under no liability, directly or indirectly, to the
Lenders for failure to obtain knowledge of any such condition or event.

(b)           Compliance Certificate.  At the time of delivery of the financial statements
provided for in Sections 6.01(a) and 6.01(b) above (commencing
with the delivery of the financial statements for the fiscal quarter ended
January 31, 2007), a Compliance Certificate of the chief executive officer or
the chief financial officer of Holdings (i) demonstrating compliance with the
financial covenants contained in Section 7.17 by calculation thereof as
of the end of the fiscal period covered by such financial statements, (ii)
stating that no Event of Default exists, or if any Event of Default does exist,
specifying the nature and extent thereof and what action the Borrower proposes
to take with respect thereto and (iii) stating whether, since the date of the
most recent financial statements delivered hereunder, there has been any
material change in the GAAP applied in the preparation of the financial
statements of Holdings and its Consolidated Subsidiaries, and, if so,
describing such change.  At the time such
certificate is required to be delivered, the Borrower shall promptly deliver to
the Administrative Agent, at the Administrative Agent’s Office, information
regarding any change in the Total Leverage Ratio that would change the then
existing Applicable Margin.

(c)           Auditor’s Reports.  At the time of delivery of the financial
statements provided for in Section 6.01(a) above, management letters or
recommendations submitted to the board of directors (or the audit committee of
the board of directors) of any Group Company by independent accountants in
connection with the accounts or books of any Group Company, or any audit of any
of them with respect to the prior fiscal year.

(d)           SEC Reports.  Promptly after the same are available, copies
of each annual report, proxy or financial statement or other report or
communication sent to the stockholders of Parent Holdings generally, and copies
of all annual, regular, periodic and special reports and registration
statements which any Group Company may file or be required to file with the SEC
under Section 13 or 15(d) of the Exchange Act, and not otherwise required to be
delivered to the Administrative Agent pursuant hereto.

(e)           Annual Business Plan and Budgets At
the time of delivery of the financial statements provided for in Section
6.01(a), beginning with the fiscal year ending October 31, 2007, an 

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annual business plan and budget of Parent Holdings and its Consolidated
Subsidiaries containing, among other things, projected financial statements for
the next fiscal year.

(f)            Excess Cash Flow.  Within 100 days after the end of each fiscal
year of Holdings, commencing with the fiscal year ending October 31, 2007, a
certificate of the chief financial officer of Holdings containing information
regarding the calculation of Excess Cash Flow for such fiscal year.

(g)           Employee Benefit Reports.  At the time of delivery of the financial
statements provided for in Section 6.01(a), the most recently prepared
actuarial reports in relation to the Plans and Employee Benefit Arrangements
for the time being operated by Group Companies, and within 30 days of the same
becoming available, the most recently prepared actuarial reports in relation to
the Foreign Pension Plans, which are prepared in order to comply with the then
current statutory or auditing requirements within the relevant jurisdiction
other than with respect to Foreign Pension Plans where the aggregate Unfunded
Liabilities of such Foreign Pension Plans are less than $750,000.  If requested by the Administrative Agent, the
Borrower will promptly instruct an actuary to prepare such actuarial reports
and deliver those to the Administrative Agent, if the Administrative Agent has
reasonable grounds for believing that any relevant statutory or auditing
requirement within the relevant jurisdiction is not being complied with.  Promptly upon request, the Borrower shall also
furnish the Administrative Agent and the Lenders with such additional
information concerning any Plan, Foreign Pension Plan or Employee Benefit
Arrangement as may be reasonably requested, including, but not limited to, with
respect to any Plans, copies of each annual report/return (Form 5500 series),
as well as all schedules and attachments thereto required to be filed with the
Department of Labor pursuant to ERISA and the Code, respectively, for each “plan
year” (within the meaning of Section 3(39) of ERISA).

(h)           Environmental Reports.  Promptly after any Group Company learning of
any of the following, written notice of each of the following:

(i)            that any Group
Company is or may be liable to any Person as a result of a Release or
threatened Release that could reasonably be expected to subject such Loan Party
or such Subsidiary to Environmental Liabilities exceeding $5,000,000;

(ii)           the receipt by any
Group Company of notification that any real or personal property of such Group
Company is or is reasonably likely to be subject to any Lien; securing any
Environmental Liability;

(iii)          the receipt by any
Group Company of any notice of violation of or potential liability under, or
knowledge by such Group Company that there exists a condition that could
reasonably be expected to result in a violation of or liability under, any
Environmental Law, except for violations and liabilities the consequence of
which, in the aggregate, would not be reasonably likely to subject Holdings and
its Consolidated Subsidiaries collectively to Environmental Liabilities
exceeding $5,000,000;

(iv)          the commencement of
any judicial or administrative proceeding or investigation alleging a violation
of or liability under any Environmental Law, that, in the aggregate, if
adversely determined, would have a reasonable likelihood of subjecting Holdings
and its Consolidated Subsidiaries collectively to Environmental Liabilities
exceeding $5,000,000;

(v)           any proposed
acquisition of stock, assets or real estate, any proposed leasing of property or
any other action by any Group Company other than those the consequences 

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of which, in
the aggregate, do not have a reasonable likelihood of subjecting Holdings and
its Consolidated Subsidiaries collectively to Environmental Liabilities
exceeding $5,000,000;

(vi)          any proposed action
by any Group Company or any proposed change in Environmental Laws that, in the
aggregate, have a reasonable likelihood of requiring any Group Company to
obtain additional environmental, health or safety Permits or make additional
capital improvements to obtain compliance with Environmental Laws that, in the
aggregate, would have cost $2,000,000 or more or that shall subject Holdings
and it Consolidated Subsidiaries to additional Environmental Liabilities
exceeding $5,000,000; and

(vii)         upon written request
by any Lender through the Administrative Agent, a report providing an update of
the status of any environmental, health or safety compliance, hazard or
liability issue identified in any notice or report delivered pursuant to this
Agreement.

(i)            Additional Patents, Trademarks and Copyrights.  At the time of delivery of the financial
statements and reports provided for in Section 6.01(a), a report signed
by the chief financial officer of the Borrower setting forth (i) a list of registration
numbers for all patents, trademark registrations, service mark registrations,
registered tradenames and copyright registrations awarded to the Borrower or
any Domestic Subsidiary since the last day of the immediately preceding fiscal
year of Holdings and (ii) a list of all patent applications, trademark
applications, service mark applications, trade name applications and copyright
applications submitted by the Borrower or any Domestic Subsidiary since the
last day of the immediately preceding fiscal year and the status of each such
application, all in such form as shall be reasonably satisfactory to the
Administrative Agent.

(j)            Domestication in Other Jurisdiction.  Not less than 30 days prior to any change in
the jurisdiction of organization of any Loan Party, a copy of all documents and
certificates intended to be filed or otherwise executed to effect such change.

(k)           Other Information.  With reasonable promptness upon request
therefor, such other information regarding the business, properties or
financial condition of any Group Company as the Administrative Agent or any
Lender may reasonably request, which may include such information as any Lender
may reasonably determine is necessary or advisable to enable it either (i) to
comply with the policies and procedures adopted by it and its Affiliates to
comply with the Bank Secrecy Act, the U.S. Patriot Act and all applicable
regulations thereunder or (ii) to respond to requests for information
concerning Holdings and its Subsidiaries from any governmental, self-regulatory
organization or financial institution in connection with its anti-money
laundering and anti-terrorism regulatory requirements or its compliance
procedures under the U.S. Patriot Act, including in each case information
concerning the Borrower’s direct and indirect shareholders and its use of the
proceeds of the Credit Extensions hereunder.

(l)            Labeling and Treatment of Certain Information.  Each of Holdings and the Borrower hereby
acknowledges that (i) the Administrative Agent and/or the Joint Lead Arrangers
will make available to the Lenders and the L/C Issuers materials and/or
information provided by or on behalf of Holdings and the Borrower hereunder
(collectively, “Group Company Materials”) by posting the Group Company
Materials on IntraLinks or another similar electronic system (the “Platform”)
and (ii) certain of the Lenders may be “public-side” Lenders (i.e., Lenders
that do not wish to receive material non-public information with respect to
Holdings, the Borrower or their respective securities) (each, a “Public
Lender”).  Each of Holdings and the
Borrower hereby agrees that:  (i) all
Group Company Materials that are to be made available to Public Lenders shall
be clearly and conspicuously marked “PUBLIC” which, at a minimum, shall mean
that the word “PUBLIC” shall appear prominently on the first page thereof; (ii)
by marking Group Company Materials “PUBLIC,” each of Holdings and the 

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Borrower shall be deemed to have authorized the Administrative Agent,
the Joint Lead Arrangers, the L/C Issuers and the Lenders to treat such Group
Company Materials as either publicly available information or not material
information (although it may be sensitive and proprietary) with respect to
Holdings, the Borrower or their securities for purposes of United States
federal and state securities laws; (iii) all Group Company Materials marked “PUBLIC”
are permitted to be made available through a portion of the Platform designated
“Public Investor”, and (iv) the Administrative Agent and the Joint Lead Arrangers
shall be entitled to treat any Group Company Materials that are not marked “PUBLIC”
as being suitable only for posting on a portion of the Platform not designated “Public
Investor”.

Documents required to be
delivered pursuant to Section 6.01(a) or (b) or Section
6.02(d) (to the extent any such documents are included in materials
otherwise filed with the SEC) may be delivered electronically and if so
delivered, shall be deemed to have been delivered on the date (i) on which the
Borrower posts such documents, or provides a link thereto on the Borrower’s
website on the Internet at the website address listed on Schedule 10.02;
or (ii) on which such documents are posted on the Borrower’s behalf on an
Internet or Intranet website, if any, to which each Lender and the
Administrative Agent have access (whether a commercial, third-party website or
whether sponsored by the Administrative Agent); provided that: (i) the
Borrower shall deliver paper copies of such documents to the Administrative
Agent until a written request to cease delivering paper copies is given by the
Administrative Agent and (ii) the Borrower shall notify (which may be by
facsimile or electronic mail) the Administrative Agent and each Lender of the
posting of any such documents and provide to the Administrative Agent by
electronic mail electronic versions (i.e., soft copies) of such
documents.  Notwithstanding anything
contained herein, in every instance the Borrower shall be required to provide
paper copies of the Compliance Certificates required by Section 6.02(b)
to the Administrative Agent.  Except for
such Compliance Certificates, the Administrative Agent shall have no obligation
to request the delivery or to maintain copies of the documents referred to
above, and in any event shall have no responsibility to monitor compliance by
the Borrower with any such request for delivery, and each Lender shall be
solely responsible for requesting delivery to it or maintaining its copies of
such documents.

Section 6.03 
Notices. 
The Borrower will promptly notify the Administrative Agent and each
Lender:

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

(ii)           of the occurrence
of any ERISA Event and of: (A) any event or condition that constitutes, or is
reasonably likely to lead to, an ERISA Event; or (B) any change in the funding
status of any Plan or Foreign Pension Plan that would reasonably be expected to
have a Material Adverse Effect; or (C) any event or condition that constitutes,
or is reasonably likely to lead to, an event described in Section
8.01(h)(iii)-(viii); and

(iii)          of any material
change in accounting policies or financial reporting practice by Holdings or
any of its Subsidiaries, except any changes that are required under GAAP and
disclosed in any financial statements delivered pursuant to Section 6.01.

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

Section 6.04 
Payment of Obligations.   Each of the Group Companies will pay and
discharge (i) all material taxes, assessments and other governmental charges or
levies imposed upon it, or 

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upon its income or profits, or upon any of its properties, before they
shall become delinquent, (ii) all lawful claims (including claims for labor,
materials and supplies) which, if unpaid, might give rise to a Lien (other than
a Permitted Lien) upon any of its properties and (iii) except as prohibited
hereunder, all of its other Indebtedness as it shall become due; provided,
however, that no Group Company shall be required to pay any such tax,
assessment, charge, levy, claim or Indebtedness which is being contested in
good faith by appropriate proceedings diligently pursued and as to which
adequate reserves have been established in accordance with GAAP, unless the
failure to make any such payment (i) could give rise to an immediate right to
foreclose on a Lien securing such amounts or (ii) could reasonably be expected
to have a Material Adverse Effect.

Section 6.05 
Preservation of Existence
Etc.; Compliance.   Except as a result of or in connection with a
dissolution, merger or disposition of a Subsidiary of the Borrower permitted
under Section 7.04 or Section 7.05, each Group Company will: (i)
preserve, renew and maintain in full force and effect its legal existence and
good standing under the Laws of the jurisdiction of its organization; (ii) take
all reasonable action to maintain all rights, privileges, permits, licenses and
franchises necessary or desirable in the normal conduct of its business, except
in the case of clause (i) or (ii) to the extent that failure to
do so could not reasonably be expected to have a Material Adverse Effect; and
(iii) preserve or renew all of its registered patents, trademarks, trade names
and service marks, the non-preservation of which could reasonably be expected
to have a Material Adverse Effect.  Each
Group Company will comply with all of its Contractual Obligations except to the
extent that the failure to comply therewith could not reasonably be expected to
have a Material Adverse Effect.

Section 6.06 
Maintenance of Properties.  Each Group Company will: (i) maintain,
preserve and protect all of its material properties and equipment necessary in
the operation of its business in good working order and condition, ordinary
wear and tear and Casualty and Condemnation excepted; and (ii) make all
necessary repairs thereto and renewals and replacements thereof except where
the failure to do so could not reasonably be expected to have a Material
Adverse Effect.

Section 6.07 
Insurance; Certain Proceeds.

(a)           Insurance Policies.  Each of the Group Companies will at all times
maintain in full force and effect insurance (including worker’s compensation
insurance, liability insurance, casualty insurance and business interruption
insurance) in such amounts, covering such risk and liabilities and with such
deductibles or self-insurance retentions as are in accordance with normal
industry practice.  The Collateral Agent
shall be named as loss payee or mortgagee, as its interest may appear, with
respect to all such property and casualty policies and additional insured with
respect to all business interruption or casualty policies, and each provider of
any such insurance shall agree, by endorsement upon the policy or policies
issued by it or by independent instruments furnished to the Collateral Agent,
that if the insurance carrier shall have received written notice from the
Collateral Agent of the occurrence and continuance of an Event of Default, the
insurance carrier shall pay all proceeds otherwise payable to Holdings or one
or more of its Subsidiaries under such policies directly to the Collateral
Agent (which agreement shall be evidenced by a “standard” or “New York” lender’s
loss payable endorsement in the name of the Collateral Agent on Accord Form 27)
and that it will give the Collateral Agent 30 days’ prior written notice before
any such policy or policies shall be altered or canceled, and that no act or
default of any Group Company or any other Person shall affect the rights of the
Collateral Agent or the Lenders under such policy or policies.

(b)           Loss Events.  In case of any Casualty or Condemnation with
respect to any property of any Group Company or any part thereof having a fair
market value in excess of $5,000,000, the Borrower shall promptly give written
notice thereof to the Administrative Agent generally describing the nature and
extent of such damage, destruction or taking. 
In such case, the Borrower shall, or shall 

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cause such Group Company to, promptly repair, restore or replace the
property of such Person (or part thereof) which was subject to such Casualty or
Condemnation, at such Person’s cost and expense, whether or not the Insurance
Proceeds or Condemnation Award, if any, received on account of such event shall
be sufficient for that purpose; provided, however, that such
property need not be repaired, restored or replaced to the extent the failure
to make such repair, restoration or replacement (i)(A) is desirable to the
proper conduct of the business of such Person in the ordinary course and
otherwise in the best interest of such Person and (B) would not materially
impair the rights and benefits of the Collateral Agent or the Finance Parties
under the Collateral Documents or any other Loan Document or (ii) the failure
to repair, restore or replace the property is attributable to the application
of the Insurance Proceeds from such Casualty or the Condemnation Award from
such Condemnation to payment of the Senior Credit Obligations in accordance
with the following provisions of this Section 6.07(b).  If Holdings or any of its Subsidiaries shall
receive any Insurance Proceeds from a Casualty or Condemnation Award from a
Condemnation exceeding $5,000,000 in respect of the single event or series of
related events giving rise thereto, such Person will promptly pay over such
proceeds to the Administrative Agent, for payment of the Senior Credit
Obligations in accordance with Section 2.09(b) or, if such funds
constitute Reinvestment Funds, to be held by the Collateral Agent in the
Reinvestment Funds Account established under the Security Agreement.  The Administrative Agent agrees to cause the
Collateral Agent to release such Insurance Proceeds or Condemnation Awards to
the Borrower upon its request and as needed from time to time to pay for the
repair, restoration or replacement of the portion of the property subject to
such Casualty or Condemnation if, but only if, the conditions set forth in the
definition of “Reinvestment Funds” are satisfied at the time of such request.

Section 6.08 
Compliance with Laws.  Each of the Group Companies will comply with
all requirements of Law applicable to it and its properties to the extent that
noncompliance with any such requirement of Law would reasonably be expected to
have a Material Adverse Effect.  Without
limiting the generality of the foregoing, each of the Group Companies will do
each of the following as it relates to any Plan maintained by, or Multiemployer
Plan contributed to by, each of the Group Companies, Foreign Pension Plan or
Employee Benefit Arrangement: 
(i) maintain each Plan (other than a Multiemployer Plan), Foreign
Pension Plan and Employee Benefit Arrangement in compliance in all material
respects with the applicable provisions of ERISA, the Code or other Federal,
state or foreign Law; (ii) cause each Plan (other than a Multiemployer
Plan) which is qualified under Section 401(a) of the Code to maintain such
qualifications; (iii) make all required contributions to any Plan subject
to Section 412 of the Code and make all required contributions to Multiemployer
Plans; (iv) ensure that there are no Unfunded Liabilities in excess of
$5,000,000 unless the aggregate amount of such Unfunded Liabilities is reduced
below $5,000,000 within a 30-day period; (v) except for the obligations set
forth on Schedule 5.12, not become a party to any Multiemployer Plan;
(vi) make all contributions (including any special payments to amortize any
Unfunded Liabilities) required to be made in accordance with all applicable
laws and the terms of each Foreign Pension Plan in a timely manner;
(vii) ensure that all liabilities under all Employee Benefit Arrangements
are either (A) funded to at least the minimum level required by law or, if
higher, to the level required by the terms governing the Employee Benefit
Arrangements; (B) insured with a reputable insurance company; or (C) provided
for or recognized in the financial statements most recently delivered to the
Administrative Agent under Section 6.01(a) or (b); and (vii)
ensure that the contributions or premium payments to or in respect of all
Employee Benefit Arrangements are and continue to be promptly paid at no less
than the rates required under the rules of such arrangements and in accordance
with the most recent actuarial advice received in relation to the Employee
Benefit Arrangement and generally in accordance with applicable Law; and (ix)
shall use its reasonable efforts to cause each of its ERISA Affiliates to do
each of the items listed in clauses (i) through (iv) above as it
relates to Plans and Multiemployer Plans maintained by or contributed to by its
ERISA Affiliates such that there shall be no liability to a Group Company by
virtue of such ERISA Affiliate’s acts or failure to act.

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Section 6.09 
Books and Records; Lender
Meeting.  Each of the Group Companies will keep
complete and accurate books and records of its transactions in accordance with
good accounting practices on the basis of GAAP (including the establishment and
maintenance of appropriate reserves).  If
the Administrative Agent so requests, the Borrower will conduct a meeting of
the Lenders within 90 days after the end of each fiscal year of the Borrower to
discuss such fiscal year’s results and the financial condition of the Borrower
and its Consolidated Subsidiaries.  The
chief executive officer and the chief financial officer of the Borrower and
such other officers of the Borrower as the Borrower’s chief executive officer
shall designate shall be present at each such meeting.  Such meetings shall be held at times and
places convenient to the Lenders and to the Borrower.

Section 6.10 
Inspection Rights. 
Upon reasonable notice and during normal business hours (but no more
frequently than twice per year unless an Event of Default has occurred and is
continuing), each of the Group Companies will permit representatives appointed
by the Agents, including agents, employees, attorneys and appraisers, to visit
and inspect its property, including its books and records, its accounts
receivable and inventory, its facilities and its other business assets, and to
make photocopies or photographs thereof and to write down and record any
information such representatives obtain and shall permit the Agents or such
representatives to investigate and verify the accuracy of information provided
to the Lenders and to discuss all such matters with the officers, employees,
independent accountants, attorneys and representatives of the Group Companies.

Section 6.11 
Use of Proceeds.   The Borrower will use the proceeds of the
Loans and will use the Letters of Credit solely for the purposes set forth in Section
5.18.

Section 6.12 
Additional Loan Parties; Additional Security.

(a)           Additional Subsidiary Guarantors.  Each of Holdings and the Borrower will take,
and will cause each of its Subsidiaries (other than Foreign Subsidiaries,
except to the extent provided in subsection (d) below) to take, such
actions from time to time as shall be necessary to ensure that all Subsidiaries
of Holdings (other than the Borrower and Foreign Subsidiaries, except to the
extent provided in subsection (d) below) are Subsidiary Guarantors.  Without limiting the generality of the
foregoing, if any Group Company shall form or acquire any new Subsidiary, the
Borrower, as soon as practicable and in any event within 30 days after such
formation or acquisition, will provide the Collateral Agent with notice of such
formation or acquisition setting forth in reasonable detail a description of
all of the assets of such new Subsidiary and will cause such new Subsidiary
(other than a Foreign Subsidiary, except to the extent provided in subsection
(d) below) to:

(i)            within 30 days
after such formation or acquisition, execute an Accession Agreement pursuant to
which such new Subsidiary shall agree to become a “Guarantor” under the
Guaranty, an “Obligor” under the Security Agreement and an “Obligor” under the
Pledge Agreement and/or an obligor under such other Collateral Documents as may
be applicable to such new Subsidiary; and

(ii)           deliver such proof
of organizational authority, incumbency of officers, opinions of counsel and
other documents as is consistent with those delivered by each Loan Party
pursuant to Section 4.01 on the Closing Date or as the Administrative
Agent or the Collateral Agent shall have reasonably requested.

(b)           Additional Security.  With respect to any owned Real Property
having a fair market value in excess of $1,000,000 acquired by any Loan Party
subsequent to the Closing Date, such Person will cause to be delivered to the
Collateral Agent with respect to such Real Property documents, instruments and
other items of the types customarily required by lenders in transactions
similar to the

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transactions contemplated herein, all in form, content and scope
reasonably satisfactory to the Collateral Agent.  In furtherance of the foregoing terms of this
Section 6.12, the Borrower agrees to promptly provide the Administrative
Agent with written notice of the acquisition by Holdings or any of its
Subsidiaries of any owned Real Property having a market value greater than
$1,000,000 or the entering into a lease by Holdings or any of its Subsidiaries
of any Real Property for annual rent of $500,000 or more, setting forth in each
case in reasonable detail the location and a description of the asset(s) so
acquired or leased.  Without limiting the
generality of the foregoing, Holdings and the Borrower will cause, and will
cause each of their respective Subsidiaries to cause, 100% of the Equity
Interests of each of their respective direct and indirect Domestic Subsidiaries
(or (x) 65% of such Equity Interests, if such Subsidiary is a direct Foreign
Subsidiary or, following a Foreign IP Transfer Transaction, each Foreign IP
Holdco, except as provided in subsection (d) below, or (y) to the extent
not prohibited by the terms of any Organization Document or other agreement
governing a Permitted Joint Venture, such percentage as is equal to their
respective ratable ownership of all Equity Interests in Permitted Joint
Ventures and non-Wholly-Owned Subsidiaries) to be subject at all times to a
first priority, perfected Lien in favor of the Collateral Agent pursuant to the
terms and conditions of the Collateral Documents, subject only to Permitted
Liens described in Section 7.02(iii) or (v).

If,
subsequent to the Closing Date, a Loan Party shall acquire any patents,
trademark registrations, service mark registrations, registered tradenames,
copyright registrations, any applications relating to the foregoing,
securities, instruments, chattel paper or other personal property required to
be delivered to the Collateral Agent as Collateral hereunder or under any of
the Collateral Documents, the Borrower shall promptly (and in any event within
ten Business Days after any Responsible Officer of any Loan Party acquires
knowledge of the same) notify the Collateral Agent of the same.  Each of the Loan Parties shall adhere to the
covenants regarding the location of personal property as set forth in the
Collateral Documents.

All
such security interests and mortgages shall be granted pursuant to
documentation consistent with the Collateral Documents executed at Closing and
otherwise reasonably satisfactory in form and substance to the Collateral Agent
(collectively, the “Additional Collateral Documents”) and shall constitute
valid and enforceable perfected security interests and mortgages superior to
and prior to the rights of all third Persons and subject to no other Liens
except for Permitted Liens.  The
Additional Collateral Documents or instruments related thereto shall have been
duly recorded or filed in such manner and in such places as are required by law
to establish, perfect, preserve and protect the Liens in favor of the
Collateral Agent required to be granted pursuant to the Additional Collateral
Documents, and all taxes, fees and other charges payable in connection
therewith shall have been paid in full. 
The Borrower shall cause to be delivered to the Collateral Agent such
opinions of counsel, title insurance and other related documents as may be
reasonably requested by the Collateral Agent to assure itself that this Section
6.12(b) has been complied with.

(c)           Real Property Appraisals.  If the Collateral Agent or the Required
Lenders determine that they are required by Law or regulation to have
appraisals prepared in respect of the owned Real Property of any Group Company
constituting Collateral, the Borrower shall provide to the Collateral Agent
appraisals which satisfy the applicable requirements set forth in 12 C.F.R.,
Part 34 - Subpart C or any successor or similar statute, rule, regulation,
guideline or order, and which shall be in scope, form and substance, and from
appraisers, reasonably satisfactory to the Collateral Agent and shall be
accompanied by a certification of the appraisal firm providing such appraisals
that the appraisals comply with such requirements.

(d)           Foreign Subsidiaries Security.  If, following a change that is reasonably
determined to be material by the Administrative Agent in the relevant Sections
of the Code or the regulations, rules, rulings, notices or other official
pronouncements issued or promulgated thereunder, the 

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Borrower or its counsel or advisors reasonably acceptable to the
Administrative Agent does not within 45 days after a request from the
Administrative Agent deliver evidence, in form and substance mutually
satisfactory to the Administrative Agent and the Borrower, with respect to any
Foreign Subsidiary of Holdings which has not already had all of the Equity
Interests issued by it pledged pursuant to the Pledge Agreement that (i) a
pledge (A) of 65.0% or more of the total combined voting power of all classes
of capital stock of such Foreign Subsidiary entitled to vote, and (B) of any
promissory note issued by such Foreign Subsidiary to the Borrower or any of its
Domestic Subsidiaries, (ii) the entering into by such Foreign Subsidiary of a
guaranty in form and substance substantially identical to the Guaranty, (iii)
the entering into by such Foreign Subsidiary of a security agreement in form
and substance substantially identical to the Security Agreement, and (iv) the
entering into by such Foreign Subsidiary of a pledge agreement substantially
identical to the Pledge Agreement, in any such case would cause all or any
portion of the undistributed earnings of such Foreign Subsidiary as determined
for United States federal income tax purposes to be treated as a deemed
dividend to such Foreign Subsidiary’s United States parent (or other domestic
Affiliate) for United States federal income tax purposes under Code Section 956
or any similar provision of federal, state or local tax Law, then, (A) in the
case of a failure to deliver the evidence described in clause (i) above,
that portion of such Foreign Subsidiary’s outstanding capital stock or any
promissory notes so issued by such Foreign Subsidiary, in each case not
theretofore pledged pursuant to the Pledge Agreement, shall be pledged to the
Collateral Agent for the benefit of the Finance Parties pursuant to the Pledge
Agreement (or another pledge agreement in substantially identical form, if
needed); (B) in the case of a failure to deliver the evidence described in clause
(ii) above, such Foreign Subsidiary shall execute and deliver the Guaranty
(or another guaranty in substantially identical form, if needed), guaranteeing
the Senior Credit Obligations; (C) in the case of a failure to deliver the
evidence described in clause (iii) above, such Foreign Subsidiary shall
execute and deliver the Security Agreement (or another security agreement in
substantially identical form, if needed), granting to the Collateral Agent, for
the benefit of the Finance Parties, a security interest in all of such Foreign
Subsidiary’s assets and securing the Finance Obligations; and (D) in the case
of a failure to deliver the evidence described in clause (iv) above,
such Foreign Subsidiary shall execute and deliver the Pledge Agreement (or
another pledge agreement in substantially identical form, if needed), pledging
to the Collateral Agent, for the benefit of the Finance Parties, all of the
capital stock and promissory notes owned by such Foreign Subsidiary, in each
case to the extent that entering into the Guaranty, Security Agreement or
Pledge Agreement is permitted by the Laws of the respective foreign
jurisdiction and with all documents delivered pursuant to this Section
6.12(d) to be in form, scope and substance reasonably satisfactory to the
Collateral Agent.

(e)           Completion of Required Actions.  Each of Holdings and the Borrower agrees that
each action required by the foregoing paragraphs of this Section 6.12
shall be completed as soon as possible, but in no event later than 60 days
after such action is either requested to be taken by the Collateral Agent or
required to be taken by Holdings or any of its Subsidiaries pursuant to the
terms of this Section 6.12.

Section 6.13 
Interest Rate Protection
Agreements.  Within 90 days after the Closing Date, the
Borrower will enter into and thereafter maintain in full force and effect
interest rate swaps, rate caps, collars or other similar agreements or arrangements
designed to hedge the position of the Borrower with respect to interest rates
at rates and on terms reasonably satisfactory to the Administrative Agent,
taking into account the market conditions, to provide protection against
interest rates on Indebtedness bearing floating interest rates for a period
expiring no earlier than 24 months after the date of execution and delivery of
such agreements with respect to a notional amount of Indebtedness of Holdings
and its Subsidiaries such that, after giving effect thereto, at least 30% of
the Indebtedness of Holdings and its Subsidiaries (including appropriate
adjustments commensurate with any Facilities Increase) bears fixed interest
rates.  The Borrower will promptly deliver
evidence of the execution and delivery of such agreements to the Administrative
Agent.

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Section 6.14 
Contributions. 
Within three Business Days following its receipt thereof, Holdings will
contribute as a common equity contribution to the capital of the Borrower any
cash proceeds received by Holdings after the Closing Date from any Asset
Disposition, Casualty, Condemnation or Debt Issuance received by Holdings after
the Closing Date.

ARTICLE
VII

NEGATIVE COVENANTS

Each
of Holdings and the Borrower agrees that so long as any Lender has any Commitment
hereunder, any Senior Credit Obligations or other amount payable hereunder or
under any Note or other Loan Document or any L/C Obligation (in each case other
than contingent indemnification obligations) remains unpaid or any Letter of
Credit remains unexpired:

Section 7.01 
Limitation on Indebtedness.
 None of the Group Companies will incur,
create, assume or permit to exist any Indebtedness or Swap Obligations except:

(i)            Indebtedness of the
Borrower and its Subsidiaries outstanding on the Closing Date and of Lipman and
its Subsidiaries outstanding immediately after consummation of the Merger, in
each case as disclosed on Schedule 7.01 (collectively, the “Existing
Indebtedness”), and any modifications, refinancings, refundings, renewals
or extensions thereof; provided, that (A) the amount of such
Indebtedness is not increased at the time of such modification, refinancing,
refunding, renewal or extension except by an amount equal to a reasonable
premium or other reasonable amount paid, and fees and expenses reasonably
incurred, in connection with such refinancing and by an amount equal to any
existing commitments unutilized thereunder or as otherwise permitted pursuant
to this Section 7.01, and (B) the terms and conditions (including, if
applicable, as to collateral and subordination) of any such modified,
extending, refunding or refinancing Indebtedness are not materially less
favorable to the Group Companies or the Lenders than the terms and conditions
of the Indebtedness being modified, extended, refunded or refinanced;

(ii)           Indebtedness of the
Loan Parties under this Agreement and the other Finance Documents;

(iii)          (A) Purchase Money
Indebtedness and Attributable Indebtedness in respect of Capital Leases and
Synthetic Lease Obligations of the Borrower and its Subsidiaries incurred after
the Closing Date to finance Capital Expenditures permitted by Section 7.14;
provided that (1) the aggregate amount of all such Purchase Money
Indebtedness or Attributable Indebtedness does not exceed $15,000,000 at any
time outstanding, (2) the Purchase Money Indebtedness or Attributable
Indebtedness when incurred shall not be less than 80% or more than 100% of the
lesser of the cost or fair market value as of the time of acquisition of the
asset financed and the Proceeds thereof, (3) such Purchase Money Indebtedness
or Attributable Indebtedness is issued and any Liens securing such Purchase
Money Indebtedness or Attributable Indebtedness are created concurrently with,
or within 90 days after, the acquisition of the asset financed and (4) no Lien
securing such Purchase Money Indebtedness or Attributable Indebtedness shall
extend to or cover any property or asset of any Group Company other than the
asset so financed, and (B) Attributable Indebtedness in respect of Sale/Leaseback
Transactions permitted by Section 7.13;

(iv)          Indebtedness of the
Borrower or its Subsidiaries secured by Liens permitted by clauses (xvii),
(xviii) and (xix) of Section 7.02 and any other
Indebtedness of a Person whose Equity Interests or assets are acquired in a
Permitted Business Acquisition which is 

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acquired or
assumed by the Borrower or a Subsidiary of the Borrower in such Permitted
Business Acquisition and any Permitted Refinancing thereof; provided
that (A) such Indebtedness was not incurred in connection with, or in
anticipation of, the events described in such clauses or such Permitted
Business Acquisition, and (B) such Indebtedness (other than pre-existing
Attributable Indebtedness and Purchase Money Indebtedness) does not constitute
indebtedness for borrowed money;

(v)           unsecured
Subordinated Indebtedness of the Borrower or any of its Subsidiaries that is
issued to a seller of assets or Person acquired in a Permitted Business
Acquisition and any Permitted Refinancing thereof if, immediately prior to and
after giving effect thereto, (A) no Event of Default shall exist or result
therefrom and (B) Holdings and its Subsidiaries will be in compliance on a
Pro-Forma Basis with the financial covenants set forth in Section 7.17;

(vi)          (A) contingent
liabilities in respect of any indemnification, adjustment of purchase price,
earn-out, non-compete, consulting, deferred compensation and similar
obligations of the Borrower and its Subsidiaries incurred in connection with
the Transaction, Permitted Business Acquisitions, Permitted Joint Ventures and
Asset Dispositions and (B) Indebtedness incurred by the Borrower or its
Subsidiaries in a Permitted Business Acquisition or Asset Disposition under
agreements providing for earn-outs or the adjustment of the purchase price or
similar adjustments;

(vii)         Swap Obligations of
the Borrower or any Subsidiary under Swap Agreements to the extent entered into
after the Closing Date in compliance with Section 6.13 or to manage
interest rate, foreign currency exchange rate and commodity pricing risks and
not for speculative purposes;

(viii)        Indebtedness owed to
any Person providing property, casualty or liability insurance to the Borrower
or any Subsidiary of the Borrower, so long as such Indebtedness shall not be in
excess of the amount of the unpaid cost of, and shall be incurred only to defer
the cost of, such insurance for the year in which such Indebtedness is incurred
and such Indebtedness shall be outstanding only during such year;

(ix)           Indebtedness
consisting of Guaranty Obligations (A) by the Borrower in respect of
Indebtedness, leases or other ordinary course obligations permitted to be
incurred by, or obligations in respect of Permitted Business Acquisitions or
Permitted Joint Ventures of, Wholly-Owned Domestic Subsidiaries of the
Borrower, (B) by Domestic Subsidiaries of the Borrower of Indebtedness, leases
or other ordinary course obligations permitted to be incurred by, or
obligations in respect of Permitted Business Acquisitions or Permitted Joint
Ventures of, the Borrower or Wholly-Owned Domestic Subsidiaries of the
Borrower, (C) by Foreign Subsidiaries of the Borrower of Indebtedness, leases
or other ordinary course obligations permitted to be incurred by, or
obligations in respect of Permitted Business Acquisitions or Permitted Joint
Ventures of, Wholly-Owned Foreign Subsidiaries of the Borrower and (D) by the
Borrower or any Subsidiary of the Borrower of Indebtedness, leases or other
ordinary course obligations permitted to be incurred by, Foreign Subsidiaries;
provided that the aggregate amount of Guaranty Obligations referred to in this
clause (D), together with all Investments by the Borrower and its Wholly-Owned
Domestic Subsidiaries permitted under Section 7.06(a)(xi)(A), will not
exceed at any one time outstanding $10,000,000;

(x)            inter-company
Indebtedness owing to the Borrower or a Subsidiary of the Borrower to the
extent permitted by Section 7.06(a)(x) or (xi);

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(xi)           Indebtedness of
Foreign Subsidiaries incurred on or after the Closing Date to finance working
capital requirements and Permitted Refinancings thereof (determined without
regard to clause (ii) of the definition thereof) in an aggregate
principal amount which, when taken together with the then outstanding principal
amount of all Indebtedness of Foreign Subsidiaries referred to in clause (i)
above, does not exceed the sum of (A) the aggregate principal amount of
all Indebtedness of Foreign Subsidiaries outstanding on the Closing Date and
disclosed on Schedule 7.01 plus (B) $30,000,000 (or its equivalent
in one or more applicable foreign currencies);

(xii)          (A) Indebtedness of
the Borrower and its Subsidiaries arising from the honoring by a bank or other
financial institution of a check, draft or similar instrument drawn against
insufficient funds in the ordinary course of business; provided that (1)
such Indebtedness (other than credit or purchase cards) is extinguished within
three Business Days of its incurrence and (2) such Indebtedness in respect of
credit or purchase cards in extinguished within 60 days from its incurrence,
and (B) contingent indemnification obligations of the Borrower and its
Subsidiaries to financial institutions, in each case to the extent in the
ordinary course of business and on terms and conditions which are within the general
parameters customary in the banking industry, entered into to obtain cash
management services or deposit account overdraft protection services (in amount
similar to those offered for comparable services in the financial industry) or
other services in connection with the management or opening of deposit accounts
or incurred as a result of endorsement of negotiable instruments for deposit or
collection purposes;

(xiii)         Indebtedness of the
Borrower and its Subsidiaries representing deferred compensation to employees
of the Borrower and its Subsidiaries;

(xiv)        Indebtedness of
Holdings representing the obligation of Holdings to make payments with respect
to the cancellation or repurchase of certain Equity Interests of officers,
employees or directors (or their estates) of Holdings and its Subsidiaries, to
the extent permitted by Section 7.07(iii);

(xv)         unsecured
Indebtedness of the Borrower and its Subsidiaries not otherwise permitted by
this Section 7.01 incurred after the Closing Date in an aggregate principal
amount not to exceed $20,000,000 at any time outstanding; provided that
(A) the documentation with respect to such Indebtedness shall not contain
covenants or default provisions relating to Holdings or any Subsidiary of
Holdings that are more restrictive than the covenants and default provisions
contained in the Loan Documents, (B) no Default or Event of Default shall have
occurred and be continuing immediately before and immediately after giving
effect to such incurrence and (C) the Borrower shall have delivered to the
Administrative Agent a certificate demonstrating that, upon giving effect on a
Pro-Forma Basis to the incurrence of such Indebtedness and to the concurrent
retirement of any other Indebtedness of any Group Company, the Loan Parties shall
be in compliance with the financial covenants set forth in Section 7.17;
and

(xvi)        unsecured
subordinated notes of the Borrower having terms, yield, guarantees, covenants,
default and subordination provisions and other terms as are customary for
subordinated “high yield” securities issued for cash in a registered public
offering or in a private placement for resale pursuant to Rule 144A under the
Securities Act or otherwise, the proceeds of which are used to finance one or
more Permitted Business Acquisitions or to repay the Loans; provided
that (A) any such Indebtedness must constitute unsecured Subordinated
Indebtedness, (B) no Default or Event of Default shall have occurred and be
continuing immediately before and immediately after giving effect to the
incurrence thereof and (C) the Borrower shall have delivered to the
Administrative Agent a certificate demonstrating that, upon giving effect on a 

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Pro-Forma
Basis to the incurrence of such Indebtedness and to the concurrent prepayment
of the Loans, the Loan Parties shall be in compliance with the financial
covenants set forth in Section 7.17. 
The issuance of any security satisfying the requirements of this clause
(xvi) is herein referred to as a “Public Debt Issuance”.

Section 7.02 
Restriction on Liens.  None of the Group Companies will create,
incur, assume or permit to exist any Lien on any property or assets (including
Equity Interests or other securities of any Person, including any Subsidiary of
Holdings) now owned or hereafter acquired by it or on any income or rights in
respect of any thereof, or sign or file or authorize the filing under the
Uniform Commercial Code of any jurisdiction of a financing statement that names
any Group Company as debtor, or sign any security agreement authorizing any secured
party thereunder to file such a financing statement, except Liens described in
any of the following clauses (collectively, “Permitted Liens”):

(i)            Liens existing on
the Closing Date and listed on Schedule 7.02 hereto and any
modifications, replacements, renewals or extensions thereof; provided
that (A) the Lien does not extend to any additional property other than (x)
after-acquired property that is affixed or incorporated into the property
covered by such Lien or financed by Indebtedness permitted under Section
7.01 and (y) proceeds and products thereof and (B) the renewal, extension
or modification of the Indebtedness secured or benefited by such Liens is
permitted by Section 7.01;

(ii)           Liens created by
the Collateral Documents;

(iii)          Liens for taxes,
assessments or governmental charges or levies not yet due or that are being
contested in good faith and by appropriate proceedings diligently pursued for
which adequate reserves (in the good faith judgment of the management of the
Borrower) have been established in accordance with GAAP (and as to which the
property or assets subject to any such Lien is not yet subject to foreclosure,
sale or loss on account thereof);

(iv)          Liens imposed by Law
securing the charges, claims, demands or levies of landlords, carriers,
suppliers, warehousemen, materialmen, workmen, mechanics, carriers and other
like Liens imposed by Law which were incurred in the ordinary course of
business and which (A) do not, individually or in the aggregate, materially
detract from the value of the property or assets which are the subject of such
Lien or materially impair the use thereof in the operation of the business of
the Borrower or any of its Subsidiaries or (B) which are being contested in
good faith by appropriate proceedings diligently pursued for which adequate
reserves (in the good faith judgment of the management of the Borrower) have
been established in accordance with GAAP, which proceedings have the effect of
preventing the forfeiture or sale of the property or assets subject to such
Lien;

(v)           Liens (other than
any Liens imposed by ERISA or pursuant to any Environmental Law) not securing
Indebtedness or Swap Obligations incurred or deposits made in the ordinary
course of business in connection with workers’ compensation, unemployment
insurance and other types of social security and other similar obligations
incurred in the ordinary course of business;

(vi)          Liens securing
obligations in respect of surety bonds (other than appeal bonds), bids, leases,
government contracts, performance and return-of-money bonds and other similar
obligations incurred in the ordinary course of business; provided that
in the case of Liens on cash and Cash Equivalents, the amount of all cash and
Cash Equivalents subject to such Liens may at no time exceed $5,000,000 in the
aggregate;

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(vii)         Liens upon specific
items or inventory or other goods and proceeds of the Borrower or any of its
Subsidiaries securing such Person’s obligations in respect of bankers’
acceptances or documentary letters of credit issued or created for the account
of such Person to facilitate the shipment or storage of such inventory or other
goods;

(viii)        pledges or deposits
of cash and Cash Equivalents securing deductibles, self-insurance, co-payment,
co-insurance, retentions and similar obligations to providers of insurance in
the ordinary cause of business;

(ix)           Liens on (A)
incurred premiums, dividends and rebates which may become payable under
insurance policies and loss payments which reduce the incurred premiums on such
insurance policies and (B) rights which may arise under state insurance
guarantee funds relating to any such insurance policy, in each case securing
Indebtedness permitted to be incurred pursuant to Section 7.01(viii);

(x)            Liens arising
solely by virtue of any statutory or common Law provision relating to banker’s
liens, rights of set-off or similar rights, in each case incurred in the
ordinary course of business;

(xi)           licenses, leases or
subleases granted to third Persons or to the Borrower or its Subsidiaries by the
Borrower and its Subsidiaries in the ordinary course of business not
interfering in any material respect with the business of any Group Company and
not otherwise prohibited by Section 7.05(xiv);

(xii)          zoning
restrictions, building codes, land use and other similar Laws and municipal
ordinances, easements, rights of way, licenses, reservations, covenants,
conditions, waivers, restrictions on the use of property or other minor
encumbrances or irregularities of title not securing Indebtedness or Swap Obligations
which do not, individually or in the aggregate, materially impair the use of
any property in the operation or business of Holdings or any of its
Subsidiaries or the value of such property for the purpose of such business;

(xiii)         Liens arising from
precautionary Uniform Commercial Code financing statements regarding, and any
interest or title of a licensor, lessor or sublessor under, Operating Leases
permitted by this Agreement;

(xiv)        Liens in favor of
lessor, sublessor, lessees or sublessees securing Operating Leases;

(xv)         Liens arising from
judgments, decrees or attachments (or securing of appeal bonds with respect
thereto) in circumstances not constituting an Event of Default under Section
8.01; provided that no cash or other property (other than proceeds
of insurance payable by reason of such judgments, decrees or attachments) the
fair value of which exceeds $2,500,000 is deposited or delivered to secure any
such judgment, decree or award, or any appeal bond in respect thereof;

(xvi)        Liens securing Indebtedness
permitted to be incurred under Section 7.01(i), (iii), and (iv);

(xvii)       any Lien existing on
any asset of any Person at the time such Person becomes a Subsidiary of the
Borrower and not created in contemplation of such event;

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(xviii)      any Lien on any asset
(other than on the Equity Interests of one or more Subsidiaries) of any Person
existing at the time such Person is merged or consolidated with or into the
Borrower or a Subsidiary of the Borrower and not created in contemplation of
such event;

(xix)         any Lien existing on
any asset (other than on the Equity Interests of one or more Subsidiaries)
prior to the acquisition thereof by the Borrower or a Subsidiary of the
Borrower and not created in contemplation of such acquisition;

(xx)          Liens solely on any
cash earnest money deposits made by the Borrower or any of its Subsidiaries in
connection with any letter of intent or purchase agreement with respect to a
Permitted Business Acquisition or a Permitted Joint Venture;

(xxi)         Liens on cash and
Cash Equivalents securing Swap Obligations owing to one or more Persons who are
not Swap Creditors; provided that the aggregate amount of all cash and
Cash Equivalents subject to such Liens may at no time exceed $2,000,000;

(xxii)        Liens on any assets
or Equity Interests of a Foreign Subsidiary of the Borrower securing
Indebtedness of such Foreign Subsidiary incurred pursuant to Section
7.01(xi);

(xxiii)       Liens securing
Sale/Leaseback Transactions permitted under Section 7.13; and

(xxiv)       other Liens incurred
by the Borrower and its Subsidiaries not securing Indebtedness if the aggregate
fair market value of the property subject to such Liens, and the aggregate
amount of the obligations secured thereby, do not exceed $10,000,000.

Section 7.03 
Nature of Business. 
None of the Group Companies taken as a whole will alter in any material
respect the character or conduct of the business conducted by the Group
Companies as of the Closing Date and activities directly related thereto and
similar, complimentary or related businesses.

Section 7.04 
Consolidation, Merger and
Dissolution.  Except in connection with an Asset
Disposition permitted by the terms of Section 7.05, none of the Group
Companies will enter into any transaction of merger or consolidation or
liquidate, wind up or dissolve itself or its affairs (or suffer any
liquidations or dissolutions); provided that:

(i)            any Domestic
Subsidiary of the Borrower may merge with and into, or be voluntarily dissolved
or liquidated into, the Borrower, so long as (A) the Borrower is the surviving
corporation of such merger, dissolution or liquidation, (B) the security
interests granted to the Collateral Agent for the benefit of the Finance
Parties pursuant to the Collateral Documents in the assets of the Borrower and
such Domestic Subsidiary so merged, dissolved or liquidated shall remain in
full force and effect and perfected (to at least the same extent as in effect
immediately prior to such merger, dissolution or liquidation) and (C) no Person
other than the Borrower or a Subsidiary Guarantor receives any consideration in
respect or as a result of such transaction (other than non-cash consideration
payable to Foreign Subsidiaries permitted pursuant to Section 7.06(xi)(B));

(ii)           any Domestic
Subsidiary of the Borrower may merge with and into, or be voluntarily dissolved
or liquidated into, any other Domestic Subsidiary of the Borrower, so long as
(A) in the case of any such merger, dissolution or liquidation involving one or
more Subsidiary Guarantors, (x) a Subsidiary Guarantor is the surviving
corporation of such merger, 

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dissolution or
liquidation, (y) no Person other than the Borrower or a Subsidiary
Guarantor receives any consideration in respect of or as a result of such
transaction (other than non-cash consideration payable to Foreign Subsidiaries
permitted pursuant to Section 7.06(xi)(B)) and (B) the security
interests granted to the Collateral Agent for the benefit of the Finance
Parties pursuant to the Collateral Documents in the assets of each Domestic
Subsidiary so merged, dissolved or liquidated and in the Equity Interests of
the surviving entity of such merger, dissolution or liquidation shall remain in
full force and effect and perfected (to at least the same extent as in effect
immediately prior to such merger, dissolution or liquidation);

(iii)          any Foreign
Subsidiary of the Borrower may be merged with and into, or be voluntarily
dissolved or liquidated into, the Borrower or any Wholly-Owned Subsidiary of
the Borrower, so long as (A) in the case of any such merger, dissolution
or liquidation involving one or more Subsidiary Guarantor, (x) the
Borrower or such Subsidiary Guarantor, as the case may be, is the surviving
corporation of any such merger, dissolution or liquidation and (y) no
Person other than the Borrower or a Subsidiary Guarantor receives any
consideration in respect of or as a result of such transaction (other than
non-cash consideration payable to Foreign Subsidiaries permitted pursuant to Section
7.06(xi)(B)) and (B) the security interests granted to the Collateral
Agent for the benefit of the Finance Parties pursuant to the Collateral
Documents in the assets of such Foreign Subsidiary, if any, and the Borrower or
such other Subsidiary, as the case may be, and in the Equity Interests of the
surviving entity of such merger, dissolution or liquidation shall remain in
full force and effect and perfected (to at least the same extent as in effect
immediately prior to such merger, dissolution or liquidation);

(iv)          the Borrower or any
Subsidiary of the Borrower may merge with any Person (other than Parent
Holdings or Holdings) in connection with a Permitted Business Acquisition if
(A) in the case of any such merger involving the Borrower, the Borrower
shall be the continuing or surviving corporation in such merger, (B) in
the case of any such merger involving a Subsidiary Guarantor, such Subsidiary
Guarantor shall be the continuing or surviving corporation in such merger or
the continuing or surviving corporation in such merger shall, simultaneously
with the consummation of such merger, become a Subsidiary Guarantor having all
the responsibilities and obligations of the Subsidiary Guarantor so merged,
(C) the Loan Parties shall cause to be executed and delivered such
documents, instruments and certificates as the Administrative Agent may
reasonably request so as to cause the Loan Parties to be in compliance with the
terms of Section 6.12 after giving effect to such transactions and
(D) the Borrower shall have delivered to the Administrative Agent a Pro-Forma
Compliance Certificate demonstrating that, upon giving effect on a Pro-Forma
Basis to such transaction, the Loan Parties will be in compliance with all of
the financial covenants set forth in Section 7.17 as of the last day of
the most recent period of four consecutive fiscal quarters of Holdings which
precedes or ends on the date of such transaction and with respect to which the
Administrative Agent has received the consolidated financial information
required under Section 6.01(a) or (b) and the Compliance
Certificate required by Section 6.02(b);

(v)           any Subsidiary of
the Borrower may merge with any Person (other than Parent Holdings or Holdings)
in connection with a Permitted Joint Venture if (A) in the case of any such
merger involving a Subsidiary Guarantor, such Subsidiary Guarantor shall be the
continuing or surviving corporation in such merger or the continuing or
surviving corporation in such merger shall, simultaneously with the
consummation of such merger, become a Subsidiary Guarantor having all the
responsibilities and obligations of the Subsidiary Guarantor so merged and
(B) the Loan Parties shall cause to be executed and delivered such
documents, instruments and certificates as the Administrative Agent may
reasonably request so as to cause the Loan Parties to be in compliance with the
terms of Section 6.12 after giving effect to such transactions;

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(vi)          either of Parent
Holdings or Holdings may merge with and into, or be voluntarily dissolved or
liquidated into the other so long as (A) the Collateral Agent shall have a
First Priority Lien on 100% of the issued and outstanding shares of capital
stock of the Borrower and the security interests granted to the Collateral
Agent for the benefit of the Finance Parties pursuant to the Collateral
Documents in the assets of Parent Holdings and Holdings shall otherwise remain
in full force and effect and perfected (to at least the same extent as in
effect immediately prior to such merger, dissolution or liquidation); and

(vii)         the Merger shall be
permitted in accordance with the Merger Agreement.

In the case of any merger or consolidation permitted by this Section
7.04 of any Subsidiary of Holdings which is not a Loan Party into a Loan
Party, the Loan Parties shall cause to be executed and delivered such
documents, instruments and certificates as the Administrative Agent may
reasonably request so as to cause the Loan Parties to be in compliance with the
terms of Section 6.12 after giving effect to such transaction.  Notwithstanding anything to the contrary
contained above in this Section 7.04, no action shall be permitted which
results in a Change of Control.

Section 7.05 
Asset Dispositions.  None of the Group Companies will make any
Asset Disposition; provided that:

(i)            any Group Company
may sell inventory in the ordinary course of business;

(ii)           the Borrower may
make any Asset Disposition to any of the Subsidiary Guarantors if (A) the Loan
Parties shall cause to be executed and delivered such documents, instruments
and certificates as the Administrative Agent or the Collateral Agent may
request so as to cause the Loan Parties to be in compliance with the terms of Section
6.12 after giving effect to such Asset Disposition and (B) after giving
effect to such Asset Disposition, no Default or Event of Default exists;

(iii)          the Borrower and
its Subsidiaries may liquidate or sell Cash Equivalents and Foreign Cash
Equivalents;

(iv)          the Borrower or any
of its Subsidiaries may dispose of machinery or equipment which will be
replaced or upgraded with machinery or equipment put to a similar use and owned
or otherwise used or useful in the ordinary course of business of and owned by
such Person; provided that (A) such replacement or upgraded machinery
and equipment is acquired within 180 days after such disposition, (B) the fair
market value of all property disposed of pursuant to this clause (iv)
does not exceed $5,000,000 in the aggregate in any fiscal year of the Borrower
and (C) upon their acquisition, such replacement assets become subject to the
Lien of the Collateral Agent under the Collateral Documents, if and to the
extent that the original machinery and equipment was so subject;

(v)           the Borrower or any
of its Subsidiaries may dispose of obsolete, worn-out or surplus tangible
assets in the ordinary course of business and in a commercially reasonable
manner;

(vi)          any Subsidiary of
the Borrower may sell, lease or otherwise transfer all or substantially all or
any part of its assets (including any such transaction effected by way of
merger or consolidation) to the Borrower or any Wholly-Owned Domestic
Subsidiary of the Borrower, so long as (A) the security interests, if any,
granted to the Collateral Agent for the 

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benefit of the
Finance Parties pursuant to the Collateral Documents in such assets shall
remain in full force and effect and perfected (to at least the same extent as
in effect immediately prior to such sale, lease or other transfer) and
(B) after giving effect to such Asset Disposition, no Default or Event of
Default exists;

(vii)         any non-Wholly-Owned
Domestic Subsidiary of the Borrower and any Foreign Subsidiary of the Borrower
may sell, lease or otherwise transfer all or any part of its assets (including
any such transaction effected by way of merger or consolidation) to any other
non-Wholly-Owned Domestic Subsidiary or Foreign Subsidiary of the Borrower,
respectively, so long as the security interests, if any, granted to the
Collateral Agent for the benefit of the Finance Parties pursuant to the
Collateral Documents in such assets shall remain in full force and effect and
perfected (to at least the same extent as in effect immediately prior to such
sale, lease or other transfer);

(viii)        Holdings or any
Subsidiary of the Borrower may sell or dispose of Equity Interests in Holdings
or such Subsidiary to qualify directors where required by applicable Law or to
satisfy other requirements of applicable Law with respect to the ownership of
Equity Interests in Foreign Subsidiaries;

(ix)           any Group Company
may transfer assets as a part of the consideration for Investments in Permitted
Joint Ventures;

(x)            the Borrower and
its Subsidiaries may transfer trade fixtures to Foreign Subsidiaries and to
non-Wholly-Owned Domestic Subsidiaries having an aggregate fair market value
not exceeding $2,000,000 from and after the Closing Date;

(xi)           Asset Dispositions
effected by transactions permitted under Section 7.04 shall be
permitted;

(xii)          any Group Company
may lease, as lessor or sublessor, or license, as licensor or sublicensor, real
or personal property in the ordinary course of business if not otherwise
prohibited by clause (xiv) below;

(xiii)         any Group Company
may dispose of defaulted receivables and similar obligations in the ordinary
course of business and not as part of an accounts receivable financing
transaction;

(xiv)        any Group Company
may, in the ordinary course of business, license and sublicense Intellectual
Property (A) on a non-exclusive basis and (B) on an exclusive basis having,
from and after the Closing Date, an aggregate fair market value not exceeding
$10,000,000;

(xv)         [reserved];

(xvi)        [reserved];

(xvii)       any Group Company may
dispose of non-core assets acquired in Permitted Business Acquisitions;

(xviii)      any Group Company may
enter into any Sale/Leaseback Transaction not prohibited by Section 7.01
or Section 7.13; and

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(xix)         any Group Company
may make any other Asset Disposition; provided that:  (A) at least 75% of the consideration
therefor is cash or Cash Equivalents; (B) such transaction does not involve the
sale or other disposition of a minority Equity Interest in any Group Company;
(C) the aggregate fair market value of all assets sold or otherwise disposed of
by the Group Companies in all such transactions in reliance on this clause
(xix) shall not exceed $20,000,000 in any fiscal year of the Borrower; and
(D) no Default or Event of Default shall have occurred and be continuing
immediately before or immediately after giving effect to such transaction.

Upon consummation of an Asset Disposition permitted under this Section
7.05, the Lien created thereon under the Collateral Documents (but not the
Lien on any Proceeds thereof) shall be automatically released, and the
Administrative Agent shall (or shall cause the Collateral Agent to) (to the
extent applicable) deliver to the Borrower, upon the Borrower’s request and at
the Borrower’s expense, such documentation as is reasonably necessary to
evidence the release of the Collateral Agent’s security interests, if any, in
the assets being disposed of, including amendments or terminations of Uniform
Commercial Code Financing Statements, if any, the return of stock certificates,
if any, and the release of any Subsidiary being disposed of in its entirety
from all of its obligations, if any, under the Loan Documents.

Section 7.06 
Investments.

(a)           Investments.  None of the Group Companies will hold, make
or acquire, any Investment in any Person, except the following:

(i)            Investments
existing on the date hereof disclosed on Schedule 7.06 hereto or in
Persons which are Subsidiaries on the date hereof and Investments in
Wholly-Owned Domestic Subsidiaries formed after the date hereof if the Loan
Parties shall cause to be executed and delivered such documents, instruments
and certificates as the Administrative Agent may reasonably request so as to
cause the Loan Parties to be in compliance with the terms of Section 6.12
after giving effect to such Investment;

(ii)           the Borrower or any
Domestic Subsidiary of the Borrower may invest in cash and Cash Equivalents; provided
that such Cash Equivalents shall not exceed as to any concentration limits, the
respective amounts established from time to time by the Borrower and disclosed
to the Administrative Agent;

(iii)          Foreign
Subsidiaries of the Borrower may invest in Cash Equivalents or Foreign Cash
Equivalents;

(iv)          the Borrower and any
Subsidiary of the Borrower may acquire and hold receivables, accounts, notes
receivable, equipment lease receivables, chattel paper, payment intangibles and
prepaid accounts owing to them, if created or acquired in the ordinary course
of business and payable or dischargeable in accordance with customary trade
terms;

(v)           the Borrower and
each Subsidiary of the Borrower may acquire and own Investments (including
Indebtedness obligations) received in connection with the bankruptcy or
reorganization of suppliers and customers or in settlement of delinquent
obligations of, and other disputes with, customers and suppliers arising in the
ordinary course of business;

(vi)          loans and advances
by the Borrower and its Subsidiaries to employees of Holdings and its
Subsidiaries for moving and travel and other similar expenses, in each case in 

 108
 

 

the ordinary
course of business, in an aggregate principal amount not to exceed $1,000,000
at any time outstanding (determined without regard to any write-downs or
write-offs of such loans and advances);

(vii)         deposits by the
Borrower or any Subsidiary of the Borrower made in the ordinary course of
business consistent with past practices to secure the performance of leases
shall be permitted;

(viii)        the Borrower or any
of its Subsidiaries may make loans and advances to Holdings for the purposes
and in the amounts necessary to pay the fees, expenses and taxes described in Section
7.07;

(ix)           Holdings may make
equity contributions to the capital of the Borrower;

(x)            the Borrower may
make Investments in any of its Wholly-Owned Domestic Subsidiaries and any
Subsidiary of the Borrower may make Investments in the Borrower or any
Wholly-Owned Domestic Subsidiary of the Borrower; provided that (A) each
item of intercompany Indebtedness shall be evidenced by a promissory note in
the form of Exhibit H hereto, (B) each promissory note evidencing
intercompany loans and advances made by a Foreign Subsidiary or a
non-Wholly-Owned Domestic Subsidiary to the Borrower or a Wholly-Owned Domestic
Subsidiary of the Borrower shall contain the subordination provisions set forth
in Exhibit I hereto and (C) each promissory note evidencing intercompany
loans and advances (other than promissory notes held by Foreign Subsidiaries,
except to the extent provided in Section 6.12(d)) shall be pledged to
the Collateral Agent pursuant to the Pledge Agreement;

(xi)           the Borrower and
its Subsidiaries may make Investments in any Foreign Subsidiary or any
non-Wholly-Owned Domestic Subsidiary of the Borrower (A) in the case of
Investments by the Borrower or any Wholly-Owned Domestic Subsidiary of the
Borrower, in an aggregate amount together with all Guaranty Obligations
permitted under Section 7.01(ix)(D) (determined without regard to any
write-downs or write-offs, and any conversion or exchange to Equity Interests,
of any such Investments constituting Indebtedness) at any one time outstanding
not exceeding $35,000,000, (B) to the extent such Investments represent
non-cash consideration payable in connection with a merger, dissolution or
liquidation permitted pursuant to Section 7.04(i), (ii) or (iii)
and (C) to the extent such Investments arise from the sale of inventory in the
ordinary course of business by the Borrower or such Subsidiary to such Foreign
Subsidiary or non-Wholly-Owned Domestic Subsidiary for resale by such Foreign
Subsidiary or non-Wholly-Owned Domestic Subsidiary (including any such
Investments resulting from the extension of the payment terms with respect to
such sales); provided that (1) each item of intercompany Indebtedness
shall be evidenced by a promissory note in the form of Exhibit H hereto,
(2) each such promissory note (other than promissory notes (x) issued by
Foreign Subsidiaries of the Borrower to the Borrower or any of its Domestic
Subsidiaries or (y) held by Foreign Subsidiaries of the Borrower, in each
case except to the extent provided in Section 6.12(d)) shall be pledged
to the Collateral Agent pursuant to the Pledge Agreement and (3) each
Investment referred in clause (B) above evidenced by promissory note in favor
of a Foreign Subsidiary or a non-Wholly-Owned Domestic Subsidiary shall contain
the subordination provisions set forth in Exhibit I hereto;

(xii)          the Borrower and
its Subsidiaries may make Investments in Permitted Joint Ventures in an
aggregate amount, determined based on the greater of the book value or the fair
market value thereof as certified in a certificate of a financial officer of
the Borrower 

 109
 

 

delivered to
the Administrative Agent, not in excess of $10,000,000 in any fiscal year and
$20,000,000 in the aggregate during the period since the Closing Date;

(xiii)         Investments arising
out of the receipt by the Borrower or any of its Subsidiaries of non-cash
consideration for the sale of assets permitted under Section 7.05;

(xiv)        the Borrower and its
Subsidiaries may make expenditures in respect of Permitted Business
Acquisitions;

(xv)         the Borrower and its
Subsidiaries may make Investments in one or more Foreign Subsidiaries (A) to
the extent necessary to eliminate a deficit in required capital that either (x)
is funded with the proceeds of a Qualifying Equity Issuance or (y) does not
exceed $10,000,000, or (B) consisting of converting a previous debt claim
against a Foreign Subsidiary in exchange for Equity Interests in such Foreign
Subsidiary;

(xvi)        the Borrower and its
Subsidiaries may make other Investments not otherwise permitted by this Section
7.06 in an aggregate amount (determined without regard to any write-downs
or write-offs of any such Investments constituting Indebtedness but excluding
any portion thereof funded with proceeds of a Qualifying Equity Issuance not
otherwise utilized for any purpose specified in clause (ii) of the definition
of “Qualifying Equity Issuance”) at any time outstanding not exceeding the sum
of (A) $10,000,000 plus (B) an amount equal to that portion of Excess
Cash Flow for the fiscal years ended after the Closing Date, if any, not
required to be used to prepay the Loans or Cash Collateralize L/C Obligations
in accordance with Section 2.09, to make Restricted Payments under Section
7.07(iii) or to make Consolidated Capital Expenditures under Section
7.14(c); and

(xvii)       the Borrower may
consummate the Merger;

provided that no Group Company may
make or own any Investment in Margin Stock.

(b)           Limitation on the Creation of Subsidiaries.  No Group Company will establish, create or
acquire after the Closing Date any Subsidiary; provided that the
Borrower and its Subsidiaries shall be permitted to establish, create or
acquire Subsidiaries so long as (i) written notice thereof is given to the
Administrative Agent not later than 90 days after the end of the fiscal quarter
in which such establishment, creation or acquisition took place, (ii) the
Investment resulting from such establishment, creation or acquisition is
permitted pursuant to Section 7.06(a) above, (iii) the capital stock or
other equity interests of such new Subsidiary (other than a Foreign Subsidiary,
except to the extent otherwise required pursuant to Section 6.12(d)) is
pledged pursuant to, and to the extent required by, the Pledge Agreement and
the certificates representing such interests, together with transfer powers
duly executed in blank, are delivered to the Collateral Agent, (iv) such new
Subsidiary (other than a Foreign Subsidiary, except to the extent otherwise
required pursuant to Section 6.12(d)) executes a counterpart of the
Accession Agreement, the Guaranty, the Security Agreement and the Pledge
Agreement to the extent required by Section 6.12(b), and (v) such new
Subsidiary, to the extent requested by the Administrative Agent, takes all
other actions required pursuant to Section 6.12.

Section 7.07 
Restricted Payments, etc.   None of the Group Companies will declare or
pay any Restricted Payments (other than Restricted Payments payable solely in
Equity Interests (exclusive of Debt Equivalents) of such Person), except that:

(i)            any Wholly-Owned Subsidiary
of the Borrower may make Restricted Payments to the Borrower or to any
Wholly-Owned Subsidiary of the Borrower;

 110
 

 

(ii)           any
non-Wholly-Owned Subsidiary of the Borrower may make Restricted Payments to the
Borrower or to any Wholly-Owned Subsidiary of the Borrower or ratably to all
holders of its outstanding Equity Interests;

(iii)          so long as no
Default or Event of Default is then in existence or would otherwise arise
therefrom, the Borrower may make cash Restricted Payments to Holdings and
Holdings may in turn make cash Restricted Payments to Parent Holdings to enable
Parent Holdings to redeem or repurchase Equity Interests (or Equity
Equivalents) from (A) officers, employees and directors of any Group Company
(or their estates, spouses or former spouses) upon the death, permanent
disability, retirement or termination of employment of any such Person or
otherwise, or (B) other holders of Equity Interests or Equity Equivalents in
Parent Holdings; provided that in all such cases (1) no Default or Event
of Default is then in existence or would otherwise arise therefrom, (2) the
aggregate amount of all cash paid in respect of all such shares so redeemed or
repurchased does not exceed $15,000,000 in the aggregate from and after the
Closing Date, and provided  further that Parent Holdings may
purchase, redeem or otherwise acquire Equity Interests and Equity Equivalents
of Parent Holdings pursuant to this clause (iii) without regard to the
restrictions set forth in the first proviso above for consideration consisting
of (x) the proceeds of key man life insurance, (y) the Net Cash Proceeds of
Qualifying Equity Issuances not otherwise utilized for any purpose specified in
clause (ii) of the definition of “Qualifying Equity Issuance” and (z) that
portion of Excess Cash Flow for the fiscal years ended after the Closing Date,
if any, not required to be used to prepay the Loans or Cash Collateralize L/C
Obligations in accordance with Section 2.09 or utilized to make
Investments under Section 7.06(a)(xvi) or Consolidated Capital
Expenditures under Section 7.14(c);

(iv)          the Borrower may
make cash Restricted Payments to Holdings, and Holdings may in turn make cash
Restricted Payments to Parent Holdings, to enable Holdings or Parent Holdings
to pay, and in amounts not to exceed the amount necessary to pay, (A) the then
currently due fees and expenses of Holdings’ and Parent Holdings’ counsel,
accountants and other advisors and consultants, and other operating and
administrative expenses of Holdings and Parent Holdings (including employee and
compensation expenditures, directors’ and officers’ insurance premiums and
other similar costs and expenses) incurred in the ordinary course of business
that are for the benefit of, or are attributable to, or are related to,
including the financing or refinancing of, Parent Holding’s Investment in the
Borrower and its Subsidiaries, up to an aggregate amount of $500,000 for each
fiscal year, (B) the then currently due fees and expenses of Holdings’ and
Parent Holdings’ independent directors and (C) the then currently due taxes
payable by Holdings and Parent Holdings solely on account of the income of
Holdings and Parent Holdings related to their respective Investment in the
Borrower and its Subsidiaries and the reasonable expenses of preparing returns
reflecting such taxes; provided that Holdings and Parent Holdings agree
to contribute to the Borrower any refund Holdings or Parent Holdings receives
relating to any such taxes; and

(v)           the Borrower may
make cash Restricted Payments to Holdings, and Holdings may in turn make cash
Restricted Payments to Parent Holdings, to enable Holdings or Parent Holdings
to pay, and in amounts not to exceed the amount necessary to pay the amount
that the Borrower would have been required to pay for federal, state, local or
other taxes on income if it were deemed to be the common parent of an
affiliated group (within the meaning of Section 1504 of the Code) of which only
it and its Subsidiaries were members (and assuming for such purpose that such
group had the benefit of any losses of the Borrower and its Subsidiaries
previously used by Holdings or Parent Holdings); provided that such
payments may be made only in respect of the period during which the Borrower is
consolidated with Holdings and Parent 

 111
 

 

Holdings for
purposes of the payment of such taxes (such payments being herein referred to
as (“Permitted Tax Distributions”).

Section 7.08 
Payments of Indebtedness, etc.

(a)           Amendments of Agreements.  None of the Group Companies will, or will
permit any of their respective Subsidiaries to, after the issuance thereof,
amend, waive or modify (or permit the amendment, waiver or modification of) any
of the terms, agreements, covenants or conditions of or applicable to any
Indebtedness (other than the Senior Credit Obligations and, in the absence of
any Default or Event of Default, Indebtedness permitted by Section 7.01(iii))
issued by such Group Company if such amendment, waiver or modification would
add or change any terms, agreements, covenants or conditions in any manner
adverse to any Group Company, or shorten the final maturity or average life to
maturity or require any payment to be made sooner than originally scheduled or
increase the interest rate applicable thereto or change any subordination
provision thereof.

(b)           Prohibition Against Certain Payments of Principal and
Interest of Certain Other Indebtedness.  None of the Group Companies will (i) directly
or indirectly, redeem, purchase, prepay, retire, defease or otherwise acquire
for value, prior to scheduled maturity, scheduled repayment or scheduled
sinking fund payment, any Subordinated Indebtedness, or set aside any funds for
such purpose, whether such redemption, purchase, prepayment, retirement or
acquisition is made at the option of the maker or at the option of the holder
thereof, and whether or not any such redemption, purchase, prepayment,
retirement or acquisition is required under the terms and conditions applicable
to such Indebtedness or (ii) except to the extent permitted in Section
7.06(a)(xv)(B), release, cancel, compromise or forgive in whole or in part
any Indebtedness evidenced by any Intercompany Note.

Section 7.09 
Transactions with
Affiliates.  None of the Group Companies will engage in
any transaction or series of transactions with any Affiliate, other than:

(i)            transactions
permitted by Section 7.05;

(ii)           transactions
expressly permitted by Section 7.01, Section 7.04, Section
7.06 or Section 7.07;

(iii)          normal
compensation, indemnities and reimbursement of reasonable expenses of officers
and directors, including stock incentive and option plans and agreements
relating thereto;

(iv)          any transaction
entered into among the Borrower and its Wholly-Owned Domestic Subsidiaries or
among such Wholly-Owned Domestic Subsidiaries; and

(v)           other transactions
which are engaged in by the Borrower or any of its Subsidiaries in the ordinary
course of its business on terms and conditions as favorable to such Person as
would be obtainable by it in a comparable arms’-length transaction with an
independent, unrelated third party.

Section 7.10 
Fiscal Year;
Organizational and Other Documents.   None of the Group Companies will (i) change
its fiscal year or (ii) enter into any amendment, modification or waiver that
is adverse in any respect to the Lenders to its articles or certificate of
incorporation, bylaws (or analogous organizational documents) or any agreement
entered into by it with respect to its Equity Interests (including stockholders’
agreements), in each case as in effect on the Closing Date.  The Borrower will 

 112
 

 

cause the Group Companies to promptly provide the Lenders with copies
of all amendments to the foregoing documents and instruments as in effect as of
the Closing Date.

Section 7.11 
Restrictions with Respect
to Intercorporate Transfers.   None of the Group Companies will create or
otherwise cause or permit to exist any consensual encumbrance or restriction
which prohibits or otherwise restricts (i) the ability of any such Subsidiary
to (A) make Restricted Payments or pay any Indebtedness owed to the Borrower or
any Subsidiary of the Borrower, (B) pay Indebtedness or other obligations owed
to any Loan Party, (C) make loans or advances to the Borrower or any Subsidiary
of the Borrower, (D) transfer any of its properties or assets to the Borrower
or any Subsidiary of the Borrower or (E) act as a Subsidiary Guarantor and
pledge its assets pursuant to the Loan Documents or any renewals, refinancings,
exchanges, refundings or extensions thereof or (ii) the ability of Holdings or
any Subsidiary of Holdings to create, incur, assume or permit to exist any Lien
upon its property or assets whether now owned or hereafter acquired to secure
the Finance Obligations, except in each case for prohibitions or restrictions
existing under or by reason of:

(i)            this Agreement and
the other Finance Documents;

(ii)           applicable Law;

(iii)          restrictions in
effect on the date of this Agreement contained in the agreements governing the
Existing Indebtedness and in any agreements governing Permitted Refinancing
thereof if such restrictions are no more restrictive than those contained in
the agreements governing the Indebtedness being renewed, extended or
refinanced;

(iv)          customary
non-assignment provisions with respect to leases or licensing agreements
entered into by the Borrower or any of its Subsidiaries, in each case entered
into in the ordinary course of business;

(v)           any restriction or
encumbrance with respect to any asset of the Borrower or any of its
Subsidiaries or a Subsidiary of the Borrower imposed pursuant to an agreement
which has been entered into for the sale or disposition of such assets or all
or substantially all of the capital stock or assets of such Subsidiary, so long
as such sale or disposition is permitted under this Agreement;

(vi)          customary provisions
in joint venture agreements and other similar agreements entered into in the
ordinary course of business in connection with Permitted Joint Ventures; and

(vii)         Liens permitted
under Section 7.02 and any documents or instruments governing the terms
of any Indebtedness or other obligations secured by any such Liens; provided
that such prohibitions or restrictions apply only to the assets subject to such
Liens.

Section
7.12  Ownership of Subsidiaries;
Limitations on Certain Activities.

(a)           Holdings
will not (i) hold any assets other than the Equity Interests of the Borrower,
(ii) have any material liabilities other than (A) liabilities under the Loan
Documents and (B) tax liabilities in the ordinary course of business or (iii)
engage in any business or activity other than (A) owning the common stock of
the Borrower (including purchasing additional shares of common stock after the
Closing Date) and activities incidental or related thereto or to the
maintenance of the corporate existence of Holdings or compliance with applicable
Law and (B) acting as a Guarantor under the 

 113
 

 

Guaranty and pledging its assets to the Collateral Agent, for the
benefit of the Lenders, pursuant to the Collateral Documents to which it is a
party.

(b)           Holdings
and the Borrower will not permit any Person other than Holdings to hold any
Equity Interests or Equity Equivalents of the Borrower.

Section 7.13 
Sale and Leaseback
Transactions.
 None of the Group Companies will
directly or indirectly become or remain liable as lessee or as guarantor or
other surety with respect to any lease (whether an Operating Lease or a Capital
Lease) of any property (whether real, personal or mixed), whether now owned or
hereafter acquired, (i) which such Group Company has sold or transferred or is
to sell or transfer to any other Person which is not a Group Company or (ii)
which such Group Company intends to use for substantially the same purpose as
any other property which has been sold or is to be sold or transferred by such
Group Company to another Person which is not a Group Company in connection with
such lease; provided, however, that the Group Companies may enter
into such transactions with respect to personal property, in an aggregate
amount of up to $5,000,000 in sales proceeds during the term of this Agreement,
if (i) after giving effect on a Pro-Forma Basis to any such transaction the
Borrower shall be in compliance with all other provisions of this Agreement,
including Section 7.01 and Section 7.02, (ii) the gross cash
proceeds of any such transaction are at least equal to the fair market value of
such property (as determined by the Board of Directors, whose determination
shall be conclusive if made in good faith) and (iii) the Net Cash Proceeds are
forwarded to the Administrative Agent as set forth in Section 2.09(b)(iii)
to the extent required therein.

Section 7.14 
Capital Expenditures.

(a)           None
of the Group Companies will make any Consolidated Capital Expenditures, except
that during any of the fiscal years set forth below, the Borrower and its
Subsidiaries may make Consolidated Capital Expenditures so long as the
aggregate amount of such Consolidated Capital Expenditures does not exceed the
amount indicated opposite such period:

	
  Fiscal Year Ending October 31

  	
   

  	
  Amount

  	
   

  
	
  2007

  	
   

  	
  $

  	
  25,000,000

  	
   

  
	
  2008

  	
   

  	
  $

  	
  27,500,000

  	
   

  
	
  2009

  	
   

  	
  $

  	
  30,000,000

  	
   

  
	
  2010

  	
   

  	
  $

  	
  32,500,000

  	
   

  
	
  2011

  	
   

  	
  $

  	
  35,000,000

  	
   

  
	
  2012 and thereafter

  	
   

  	
  $

  	
  37,500,000

  	
   

  

 

(b)           To
the extent that Consolidated Capital Expenditures permitted under subsection (a)
above for any period set forth above are less than the applicable amount
specified in the table in subsection (a) above, 100% of the difference
may be carried forward and utilized to make Consolidated Capital Expenditures
during the immediately succeeding fiscal year.

(c)           Notwithstanding
the foregoing, the Borrower and its Subsidiaries may make Consolidated Capital
Expenditures (which Consolidated Capital Expenditures will not be included in
any determination under subsection (a) above) with (A) the Net Cash
Proceeds of Asset Dispositions, Casualties and Condemnations, to the extent
such Net Cash Proceeds are not required to be applied to repay Loans or Cash
Collateralize L/C Obligations pursuant to Section 2.09(b)(iii), (B)
the Net Cash Proceeds of Qualifying Equity Issuances not otherwise utilized for
any purpose specified in clause (ii) of the definition of “Qualifying Equity
Issuance” and (C) that portion of Excess Cash Flow for the fiscal years ended
after the Closing Date, if any, not required to be used to prepay the Loans or
Cash 

 114
 

 

Collateralize L/C Obligations in accordance with Section 2.09 or
utilized to make Investments under Section 7.06(a)(xvi) or to make
Restricted Payments under Section 7.07(iii).

(d)           The
amount of Consolidated Capital Expenditures permitted under subsection (a)
above for the fiscal year ending October 31, 2007 may be increased by an
aggregate amount not exceeding $10,000,000 for expenditures incurred in
connection with the re-implementation of an Oracle E-Business Suite 11i (Oracle
11i) enterprise resource planning (ERP) system.

Section 7.15 
Additional Negative
Pledges.  None of the Group Companies will enter into,
assume or become subject to any agreement prohibiting or otherwise restricting
the creation or assumption of any Lien upon its properties or assets, whether
now owned or hereafter acquired, or requiring the grant of any security for an
obligation if security is given for some other obligation, except (i) pursuant
to this Agreement and the other Loan Documents and (ii) pursuant to any
document or instrument governing Capital Lease Obligations or Purchase Money
Indebtedness incurred pursuant to Section 7.01(iii) if any such
restriction contained therein relates only to the asset or assets acquired in
connection therewith.

Section 7.16 
Impairment of Security
Interests.   None of the Group Companies will (i) take or
omit to take any action which action or omission might or would materially
impair the security interests in favor of the Collateral Agent with respect to
the Collateral or (ii) grant to any Person (other than the Collateral Agent
pursuant to the Collateral Documents) any interest whatsoever in the
Collateral, except for Permitted Liens.

Section 7.17 
Financial Covenants.

(a)           Total Leverage Ratio.  The Total Leverage Ratio of Holdings and its
Subsidiaries as of the end of any fiscal quarter of Holdings (commencing with
the fiscal quarter ending January 31, 2007) will not be greater than (i) 4.00
to 1.00 for any fiscal quarter ending on or prior to October 31, 2007 or (ii)
3.50 to 1.00 for any fiscal quarter ending thereafter.

(b)           Fixed Charge Coverage Ratio.  The Fixed Charge Coverage Ratio of Holdings
and its Subsidiaries as of the end of any fiscal quarter of Holdings
(commencing with the fiscal quarter ending January 31, 2007) will not be less
than 2.00 to 1.0.

Section 7.18 
Independence of Covenants.  All covenants contained herein shall be given
independent effect so that if a particular action or condition is not permitted
by any of such covenants, the fact that such action or condition would be
permitted by an exception to, or otherwise be within the limitations of,
another covenant shall not avoid the occurrence of a Default if such action is
taken or condition exists.

ARTICLE
VIII

DEFAULTS

Section 8.01 
Events of Default.
 An Event of Default shall exist upon the
occurrence of any of the following specified events or conditions (each an “Event
of Default”):

(a)           Payment.  Any Loan Party shall:

(i)            default in the
payment when due (whether by scheduled maturity, acceleration or otherwise) of
any principal of any of the Loans or of any L/C Disbursement; or

 115

 

(ii)           default, and such default shall
continue for five or more Business Days, in the payment when due of any
interest on the Loans, or of any fees or other amounts owing hereunder, under
any of the other Loan Documents or in connection herewith.

(b)           Representations.  Any representation or warranty made or deemed
to be made by any Loan Party herein, in any of the other Loan Documents, or in
any statement or certificate delivered or required to be delivered pursuant
hereto or thereto shall prove untrue in any material respect on the date as of
which it was made or deemed to have been made.

(c)           Covenants.  Any Loan Party shall:

(i)            default in the due performance or
observance of any term, covenant or agreement contained in Sections  6.10,
6.11, 6.12, 6.13, 6.14 or Article VII;

(ii)           default in the due performance or
observance by it of any term, covenant or agreement contained in Article VI
(other than those referred to in subsection (a) or (c)(i) of this
Section 8.01) and such default shall continue unremedied for a period of
ten Business Days after the earlier of an executive officer of a Loan Party
becoming aware of such default or notice thereof given by the Administrative
Agent; or

(iii)          default in the due performance or
observance by it of any term, covenant or agreement (other than those referred
to in subsection (a) or (c)(i) or (ii) of this Section
8.01) contained in this Agreement and such default shall continue
unremedied for a period of 30 days after the earlier of an executive officer of
a Loan Party becoming aware of such default or notice thereof given by the
Administrative Agent.

(d)           Other Loan Documents.  (i) Any Loan Party shall default in the
due performance or observance of any term, covenant or agreement in any of the
other Loan Documents the consequence of which is to adversely affect the
ability of the Loan Parties to perform their material obligations under the
Loan Documents taken as a whole and such default shall continue unremedied for
a period of 30 days after the earlier of an executive officer of a Loan Party
becoming aware of such default or notice thereof given by the Administrative
Agent, (ii) except pursuant to the terms thereof, any Loan Document shall
fail in any material respect to be in full force and effect or any Loan Party
shall so assert or (iii) except pursuant to the terms thereof, any Loan
Document shall fail in any material respect to give the Administrative Agent,
the Collateral Agent and/or the Lenders the security interests, liens, rights,
powers and privileges purported to be created thereby.

(e)           Cross-Default.

(i)            any Group Company (A) fails to make
payment when due (whether by scheduled maturity, required prepayment,
acceleration, demand or otherwise), regardless of amount, in respect of any
Indebtedness or Guaranty Obligation (other than in respect of (x) Indebtedness
outstanding under the Loan Documents and (y) Swap Agreements) having an
aggregate principal amount (including undrawn committed or available amounts
and including amounts owing to all creditors under any combined or syndicated
credit arrangement) of more than the Threshold Amount, (B) fails to perform or
observe any other condition or covenant, or any other event shall occur or
condition shall exist, under any agreement or instrument relating to any such Indebtedness
or Guaranty Obligation, if the effect of such failure, event or condition is to
cause, or to permit, with or without the giving of notice or lapse of time or
both, the holder or holders or beneficiary or beneficiaries of such
Indebtedness or Guaranty Obligation (or a trustee or agent on behalf of such
holder or holders or beneficiary or beneficiaries) to cause, such

 116
 

 

Indebtedness
to be declared to be due and payable prior to its stated maturity, or such
Guaranty Obligation to become payable, or cash collateral in respect thereof to
be demanded or (C) shall be required by the terms of such Indebtedness or
Guaranty Obligation to offer to prepay or repurchase such Indebtedness or the
primary Indebtedness underlying such Guaranty Obligation (or any portion
thereof) prior to the stated maturity thereof; or

(ii)           there occurs under any Swap Agreement
or Swap Obligation an Early Termination Date (as defined in such Swap
Agreement) resulting from (A) any event of default under such Swap Agreement as
to which any Group Company is the Defaulting Party (as defined in such Swap
Agreement) or (B) any Termination Event (as so defined) as to which any Group
Company is an Affected Party (as so defined), and, in either event, the Swap
Termination Value owed by a Group Company as a result thereof is greater than
the Threshold Amount.

(f)            Insolvency Events.  (i) Any Group Company shall commence a
voluntary case or other proceeding seeking liquidation, reorganization or other
relief with respect to itself or its debts under any Debtor Relief Law now or
hereafter in effect or seeking the appointment of a trustee, receiver,
liquidator, custodian or other similar official of it or any substantial part
of its property, or shall consent to any such relief or to the appointment of
or taking possession by any such official in an involuntary case or other
proceeding commenced against it, or shall make a general assignment for the
benefit of creditors, or shall fail generally to pay its debts as they become
due, or shall take any corporate action to authorize any of the foregoing or
(ii) an involuntary case or other proceeding shall be commenced against any
Group Company seeking liquidation, reorganization or other relief with respect
to it or its debts under any Debtor Relief Law now or hereafter in effect or
seeking the appointment of a trustee, receiver, liquidator, custodian or other
similar official of it or any substantial part of its property, and such
involuntary case or other proceeding shall remain undismissed and unstayed for
a period of 60 days, or any order for relief shall be entered against any Group
Company under the federal bankruptcy laws as now or hereafter in effect.

(g)           Judgments.  (i) One or more judgments, orders, decrees or
arbitration awards is entered against any Group Company involving in the
aggregate a liability (to the extent not covered by independent third-party
insurance or an indemnity from a credit-worthy third party as to which the
insurer or indemnitor, as applicable, does not dispute coverage), as to any
single or related series of transactions, incidents or conditions, in excess of
the Threshold Amount, and the same shall not have been discharged, vacated or
stayed pending appeal within 45 days after the entry thereof or (ii) any
non-monetary judgment, order or decree is entered against any Group Company
which has or would reasonably be expected to have a Material Adverse Effect,
and there shall be any period of 15 consecutive days during which a stay of
enforcement of such judgment or order, by reason of a pending appeal or
otherwise, shall not be in effect.

(h)           ERISA. 
(i) An ERISA Event occurs which has resulted or could reasonably be
expected to result in liability of any Group Company or any ERISA Affiliate in
an aggregate amount in excess of the Threshold Amount, (ii) there shall exist
an amount of Unfunded Liabilities, individually or in the aggregate, for all
Plans  and Foreign Pension Plans
(excluding for purposes of such computation any Plans and Foreign Pension Plans
with respect to which assets exceed benefit liabilities), in an aggregate
amount in excess of the Threshold Amount, (iii) any Foreign Pension Plan is not
in substantial compliance with all applicable pension benefits and tax laws,
(iv) any contribution required to be made in accordance with any applicable law
or the terms of any Foreign Pension Plan has not been made; (v) any event has
occurred or condition exists with respect to any Foreign Pension Plan that has
resulted or could result in any Foreign Pension Plan being ordered or required
to be wound up in whole or in part pursuant to any applicable laws or having
any applicable registration revoked or refused for the purposes of any
applicable pension benefits or tax laws or being placed under the
administration of the relevant pension

 117
 

 

benefits regulatory authority or being required to pay
any taxes or penalties under applicable pension benefits and tax laws; (vi) an
order has been made or notice has been given pursuant to any applicable pension
benefits and tax laws in respect of any Foreign Pension Plan requiring any
person to take or refrain from taking any action in respect thereof or that
there has been a contravention of any such applicable laws; (vii) an event has
occurred or a condition exists that has resulted or could result in any Group
Company  being required to pay, repay or
refund any amount other than contributions required to be made or expenses
required to be paid in the ordinary course) to or on account of any Foreign
Pension Plan or a current or former member thereof; or (viii) an event has
occurred or a condition exists that has resulted or could result in a payment
being made out of a guarantee fund established under the applicable pension
benefits laws in respect of a Foreign Pension Plan; and which, with respect to
all the events and obligations described in the preceding clauses (iii)
through (viii) of this Section 8.01(h), would reasonably be
expected to have a Material Adverse Effect.

(i)            Guaranties.  Any Guaranty given by any Loan Parties or any
provision thereof shall, except pursuant to the terms thereof, cease to be in
full force and effect, or any Guarantor thereunder or any Person acting by or
on behalf of such guarantor shall deny or disaffirm such Guarantor’s
obligations under such Guaranty.

(j)            Impairment of Collateral.  Any security interest purported to be created
by any Collateral Document shall cease to be, or shall be asserted by any Group
Company not to be, a valid, perfected, First Priority Lien (except as otherwise
expressly provided in such Collateral Document) in the securities, assets or
properties covered thereby, other than in respect of assets and properties
which, individually and in the aggregate, are not material to the Group
Companies taken as a whole or in respect of which the failure of the security
interests in respect thereof to be valid, perfected first priority security
interests will not in the reasonable judgment of the Collateral Agent have a
Material Adverse Effect on the rights and benefits of the Lenders under the
Loan Documents taken as a whole;

(k)           Ownership.  A Change of Control shall occur.

Section 8.02 
Acceleration; Remedies.  Upon the occurrence of an Event of Default
and at any time thereafter, unless and until such Event of Default has been
waived in writing with the consent of those Lenders as may be required pursuant
to Section 10.01, the Administrative Agent (or with respect to the
Collateral, the Collateral Agent) shall, upon the request and direction of the
Required Lenders, by written notice to the Borrower, take any of the following
actions without prejudice to the rights of the Agents or any Lender to enforce
its claims against the Loan Parties except as otherwise specifically provided
for herein:

(a)           Termination of Commitments.  Declare the Commitments terminated whereupon
the Commitments shall be immediately terminated.

(b)           Acceleration of Loans.  Declare the unpaid principal of and any
accrued interest in respect of all Loans, any reimbursement obligations arising
from drawings under Letters of Credit and any and all other indebtedness or
obligations of any and every kind owing by a Loan Party to any of the Lenders
hereunder to be due whereupon the same shall be immediately due and payable
without presentment, demand, protest or other notice of any kind, all of which
are hereby waived by the Loan Parties.

(c)           Cash Collateral.  Direct the Borrower to pay (and the Borrower
agrees that upon receipt of such notice, or upon the occurrence of an Event of
Default under Section 8.01(f), it will immediately pay) to the
Collateral Agent additional cash, to be held by the Collateral Agent, for the
benefit of the L/C Issuers and the Revolving Lenders, in a cash collateral
account as additional security

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for the L/C Obligations in respect of subsequent
drawings under all then outstanding Letters of Credit in an amount equal to
102% of the maximum aggregate amount which may be drawn under all Letters of
Credits then outstanding.

(d)           Enforcement of Rights.  Enforce any and all rights and interests
created and existing under the Loan Documents, including, without limitation,
all rights and remedies existing under the Collateral Documents, all rights and
remedies against a Guarantor and all rights of set-off.  In addition to the remedies set forth above,
the Collateral Agent may exercise any remedies provided for by the Collateral
Documents in accordance with the terms thereof or any other remedies provided
by applicable Law.

(e)           Enforcement Rights Vested Solely in Administrative
Agent and Collateral Agent. 
The Lenders agree that this Agreement may be enforced only by the action
of the Administrative Agent, acting upon the instructions of the Required
Lenders, and, with respect to the Collateral, the Collateral Agent, and that no
other Finance Party shall have any right individually to seek to enforce this
Agreement or to realize upon the security to be granted hereby.

Notwithstanding
the foregoing, if an Event of Default specified in Section 8.01(f) shall
occur, then the Commitments shall automatically terminate, all Loans, all reimbursement
obligations under Letters of Credit, all accrued interest in respect thereof
and all accrued and unpaid fees and other indebtedness or obligations owing to
the Lenders hereunder and under the other Loan Documents shall immediately
become due and payable and the obligation of the Borrower to Cash Collateralize
the L/C Obligations as aforesaid shall automatically become effective, in each
case without the giving of any notice or other action by the Administrative
Agent or the Lenders, which notice or other action is expressly waived by the
Loan Parties.

Section 8.03 
Application of Funds.  After the exercise of remedies provided for
in Section 8.02 (or (i) after the Loans have automatically become
immediately due and payable and the L/C Obligations have automatically been
required to be Cash Collateralized as set forth in Section 8.02 or (ii)
there shall have occurred any sale of, or other realization upon, all or any
part of the Collateral), any amounts received on account of the Finance
Obligations shall be applied by the Administrative Agent in the following
order:

FIRST, to payment of that portion of the Senior Credit Obligations
constituting fees, indemnities, expenses and other amounts (including fees,
charges and disbursements of counsel to the Administrative Agent and amounts
payable under Article III) payable to the Administrative Agent in its
capacity as such;

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

THIRD, to payment of that portion of the Senior Credit Obligations
constituting accrued and unpaid L/C Fees and interest on the Loans, commitment
fees, L/C Borrowings and other Senior Credit Obligations, ratably among the
Lenders and the L/C Issuer in proportion to the respective amounts described in
this clause Third payable to them;

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FOURTH, to payment of that portion of the Finance Obligations
constituting unpaid principal of the Loans, L/C Borrowings, amounts owing in
respect of Cash Management Obligations and amounts owing under Swap Agreements,
ratably among the Lenders, the L/C Issuers, the Swap Creditors and the Persons
owed Cash Management Obligations in proportion to the respective amounts
described in this clause Fourth held by them;

FIFTH, to the Administrative Agent for the account of the L/C Issuers,
to Cash Collateralize that portion of L/C Obligations comprised of the
aggregate undrawn amount of Letters of Credit; and

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

Subject to Section 2.05(e), amounts used to Cash Collateralize
the aggregate undrawn amount of Letters of Credit pursuant to clause Fifth
above shall be applied to satisfy drawings under such Letters of Credit as they
occur.  If any amount remains on deposit
as Cash Collateral after all Letters of Credit have either been fully drawn or
expired, such remaining amount shall be applied to the other Finance
Obligations, if any, in the order set forth above.

Section 8.04 
Rescission of Events of
Default.  If at any time after termination of the
Commitments or acceleration of the maturity of the Loans, the Borrower shall
pay all arrears of interest and all payments on account of principal of the
Loans and Unreimbursed Amounts that shall have become due otherwise than by
acceleration (with interest on principal and, to the extent permitted by law,
on overdue interest, at the rates specified herein) and all Events of Default
and Defaults (other than non-payment of principal of and accrued interest on
the Loans due and payable solely by virtue of acceleration) shall be remedied
or waived pursuant to Section 10.01 then upon the written consent of the
Required Lenders and written notice to the Borrower, the termination of the
Commitments or the acceleration and their consequences may be rescinded and
annulled; provided, however, that such action shall not affect
any subsequent Event of Default or Default or impair any right or remedy
consequent thereon.  The provisions of
the preceding sentence are intended merely to bind the Lenders and the L/C
Issuers to a decision that may be made at the election of the Required Lenders,
and such provisions are not intended to benefit the Borrower and do not give
the Borrower the right to require the Lenders to rescind or annul any
acceleration hereunder, even if the conditions set forth herein are met.

ARTICLE IX

AGENCY PROVISIONS

Section 9.01  Appointment and
Authorization of the Agents.

(a)           Appointment.  Each Lender and L/C Issuer hereby irrevocably
appoints, designates and authorizes JPMCB as Administrative Agent, and
Collateral Agent, each of Bank Leumi USA, Sun Tryst Bank and Wells Fargo Bank,
N.A. as Co-Documentation Agent and LCPI as Syndication Agent, and each Lender
and each L/C issuer authorizes each such Agent to take such action on its
behalf under the provisions of this Agreement and each other Loan Document and
to exercise such powers and perform such duties as are expressly delegated to
it by the terms of this Agreement or any other Loan Document, together with such
powers as are reasonably incidental thereto. 
Without limiting the foregoing, each Lender and each L/C Issuer hereby
authorizes the Collateral Agent to execute and deliver, and to perform its
obligations under, each of the Loan Documents to which the Collateral Agent is
a party, to exercise all rights, powers and remedies that such Agent may have
under such Loan Documents and, in the case of the Collateral Documents, to act
as agent under such Collateral Documents for the Finance Parties.  Notwithstanding any provision to the contrary
contained elsewhere herein or in any

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other Loan Document, the Agents shall not have any
duties or responsibilities, except those expressly set forth herein, nor shall
the Agents have or be deemed to have any fiduciary relationship with any Lender
or participant, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Agreement or any other Loan
Document or otherwise exist against any Agent. 
Without limiting the generality of the foregoing sentence, the use of
the term “agent” herein and in the other Loan Documents with reference to any
Agent is not intended to connote any fiduciary or other implied (or express)
obligations arising under agency doctrine of any applicable Law.  Instead, such term is used merely as a matter
of market custom, and is intended to create or reflect only an administrative
relationship between independent contracting parties.

(b)           L/C Issuers.  Each L/C Issuer shall act on behalf of the
Revolving Lenders with respect to any Letters of Credit issued by it and the
documents associated therewith, and each L/C Issuer shall have all of the
benefits and immunities (i) provided to the Administrative Agent in this Article
IX with respect to any acts taken or omissions suffered by such L/C Issuer
in connection with Letters of Credit issued by it or proposed to be issued by
it and the applications and agreements for letters of credit pertaining to such
Letters of Credit as fully as if the term “Administrative Agent” as used
in this Article IX and in the definition of “Agent-Related Person”
included the L/C Issuer with respect to such acts or omissions, and (ii) as
additionally provided herein with respect to the L/C Issuer.

(c)           Instructions of Required Lenders.  Without limiting an Agent’s right to
utilization the discretion granted hereunder or under any other Loan Document,
as to any matters not expressly provided for by this Agreement and the other
Loan Documents (including enforcement or collection), (i) the Administrative
Agent shall not be required to exercise any discretion or take any action, but
shall be required to act or to refrain from acting (and shall be fully
protected in so acting or refraining from acting) upon the instructions of the
Required Lenders, and such instructions shall be binding upon all Lenders and
each L/C Issuer, (ii) the Collateral Agent shall not be required to exercise
any discretion or take any action, but shall be required to act or to refrain
from acting (and shall be fully protected in so acting or refraining from
acting) upon the instructions of the Required Lenders, and such instructions
shall be binding upon the Lenders; provided, however, that the
Collateral Agent shall not be required to take any action that (x) the Collateral
Agent in good faith believes exposes it to personal liability unless such Agent
receives an indemnification satisfactory to it from the Lenders and the Issuers
with respect to such action or (y) is contrary to any Loan Document or
applicable Law.  The Collateral Agent
agrees to give to each other Agent and each Lender and each Issuer prompt
notice of each notice given to it by any Loan Party pursuant to the terms of
this Agreement or the other Loan Documents.

(d)           Agency Duties Limited to Applicable Classes.  In performing their respective functions and
duties hereunder and under the other Loan Documents, (i) the Administrative
Agent is acting solely on behalf of the Lenders and the L/C Issuers except to
the limited extent provided in Section 10.07(c), and (ii) the Collateral
Agent is acting solely on behalf of the Senior Credit Parties, and each of
their respective duties are entirely administrative in nature.  The Collateral Agent does not assume or shall
be deemed to have assumed any obligation other than as expressly set forth
herein and in the other Loan Documents or any other relationship as the agent,
fiduciary or trustee of or for any Lender, L/C Issuer or holder of any other
Finance Obligation.

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

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Section 9.03 
Exculpatory Provisions.  No Agent-Related Person shall be (i) liable
for any action lawfully taken or omitted to be taken by any of them under or in
connection herewith or in connection with any of the other Loan Documents or
the transactions contemplated hereby or thereby (except for its own gross
negligence or willful misconduct in connection with its duties expressly set
forth herein) or (ii) responsible in any manner to any of the Lenders or
participants for any recitals, statements, representations or warranties made
by any of the Loan Parties contained herein or in any of the other Loan
Documents or in any certificate, report, document, financial statement or other
written or oral statement referred to or provided for in, or received by an Agent
under or in connection herewith or in connection with the other Loan Documents,
or enforceability or sufficiency therefor of any of the other Loan Documents,
or for any failure of any Loan Party to perform its obligations hereunder or
thereunder.  No Agent-Related Person
shall be under any obligation to any Lender or participant or be required to
ascertain or inquire as to the performance or observance of any of the terms,
conditions, provisions, covenants or agreements contained herein or therein or as
to the use of the proceeds of the Loans or the use of the Letters of Credit or
of the existence or possible existence of any Default or Event of Default or to
inspect the properties, books or records of the Loan Parties or any Affiliate
thereof.

Section 9.04 
Reliance on Communications.

(a)           Each Agent shall be
entitled to rely, and shall be fully protected in relying, upon any writing,
communication, signature, resolution, representation, notice, consent,
certificate, affidavit, letter, telegram, facsimile, telex or telephone
message, electronic mail message, statement or other document or conversation
believed by it to be genuine and correct and to have been signed, sent or made
by the proper Person or Persons, and upon advice and statements of legal counsel
(including counsel to any Loan Party), independent accountants and other
experts selected by such Agent.  Each
Agent shall be fully justified in failing or refusing to take any action under
any Loan Document unless it shall first receive such advice or concurrence of
the Required Lenders as it deems appropriate and, if it so requests, it shall
first be indemnified to its satisfaction by the Lenders against any and all
liability and expense which may be incurred by it by reason of taking or
continuing to take any such action.  Each
Agent shall in all cases be fully protected in acting, or in refraining from
acting, under this Agreement or any other Loan Document in accordance with a
request or consent of the Required Lenders (or such greater number of Lenders
as may be expressly required hereby in any instance) and such request and any
action taken or failure to act pursuant thereto shall be binding upon all the
Lenders.

(b)           For purposes of
determining compliance with the conditions specified in Section 4.01,
each Lender that has signed this Agreement shall be deemed to have consented
to, approved or accepted or to be satisfied with, each document or other matter
required thereunder to be consented to or approved by or acceptable or
satisfactory to a Lender unless the Administrative Agent shall have received
notice from such Lender prior to the proposed Closing Date specifying its
objection thereto.

Section 9.05 
Notice of Default. 
No Agent shall be deemed to have knowledge or notice of the occurrence
of any Default, except with respect to defaults in the payment of principal,
interest and fees required to be paid to the Agent for the account of the
Lenders, unless the Agent shall have received written notice from a Lender or
the Borrower referring to this Agreement, describing such Default and stating
that such notice is a “notice of default.” 
The Administrative Agent will notify the Lenders of its receipt of any
such notice.  The Administrative Agent
shall take such action with respect to such Default as may be directed by the
Required Lenders in accordance with Article VIII; provided, however,
that unless and until the Administrative Agent has received any such direction,
the Administrative Agent may (but shall not be obligated to) take such action,
or refrain from taking such action, with respect to such Default as it shall
deem advisable or in the best interest of the Lenders.

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Section 9.06 
Credit Decision;
Disclosure of Information by Administrative Agent; No Reliance on Arrangers’ or Agents’
Customer Identification Program.

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

(b)           US Patriot Act Customer Identification Programs.  Each Lender acknowledges and agrees that
neither such Lender nor any of its Affiliates, participants or assignees may
rely on the Arranger or any Agent to carry out such Lender’s, Affiliate’s,
participant’s or assignee’s customer identification program or other
obligations required or imposed under or pursuant to the U.S. Patriot Act or
the regulations thereunder, including the regulations contained in 31 C.F.R.
103.121 (as hereafter amended or replaced, the “CIP Regulations”), or
any other Anti-Terrorism Law, including any programs involving any of the
following items relating to or in connection with any of the Loan Parties,
their Affiliates or agents, the Loan Documents or the transactions hereunder or
contemplated hereby:  (i) any
identification procedures; (ii) and recordkeeping; (iii) comparisons with
government lists, (iv) customer notices; or (v) other procedures required under
the CIP regulations or such other Laws.

Section 9.07 
Indemnification. 
Whether or not the transactions contemplated hereby are consummated, the
Lenders agree to indemnify each Agent-Related Person (to the extent not
reimbursed by or on behalf of any Loan Party and without limiting the
obligation of the Borrower and the other Loan Parties to do so), ratably
according to their respective Commitments (or if the Commitments have expired
or been terminated, in accordance with the respective principal amounts of
outstanding Loans and Participation Interests of the Lenders), from and against
any and all Indemnified Liabilities which may at any time (including, without
limitation, at any time following payment in full of the Senior Credit
Obligations) be imposed on, incurred by or asserted against any Agent-Related
Person; provided that no Lender shall be liable for the payment to any
Agent-Related Person of any portion of such Indemnified Liabilities resulting
from such Person’s gross negligence or willful misconduct; provided, however,
that no action taken in accordance with the directions of the Required Lenders
shall be deemed to constitute gross negligence or willful misconduct for
purposes of this Section 9.07; provided, further, that to
the extent that an L/C Issuer is entitled to indemnification under this Section
9.07 solely in its capacity and 

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role as L/C Issuer, only the Revolving Lenders shall be required to
indemnify such L/C issuer in accordance with Section 9.07.  Without limitation of the foregoing, each
Lender shall reimburse the Administrative Agent and the Collateral Agent upon
demand for its ratable share of any costs or out-of-pocket expenses (including
Attorney Costs) incurred by the Administrative Agent or the Collateral Agent in
connection with the preparation, execution, delivery, administration,
modification, amendment or enforcement (whether through negotiations, legal
proceedings or otherwise) of, or legal advice in respect of rights or
responsibilities under, this Agreement, any other Loan Document or any document
contemplated by or referred to herein, to the extent that the Administrative
Agent or the Collateral Agent is not reimbursed for such expenses by or on
behalf of the Borrower or any other Loan Party. 
The agreements in this Section 9.07 shall survive the payment of
the Senior Credit Obligations and all other obligations and amounts payable
hereunder and under the other Loan Documents and the resignation of the
Administrative Agent and the Collateral Agent.

Section 9.08 
Agents in Their Individual
Capacity.   JPMCB and its Affiliates may make loans to,
issue letters of credit for the account of, accept deposits from, acquire
Equity Interests in and generally engage in any kind of banking, trust,
financial advisory, underwriting or other business with each of the Loan
Parties and their respective Affiliates as though JPMCB were not the
Administrative Agent, the L/C Issuer, the Swing Line Lender, or the Collateral
Agent hereunder or under another Loan Document and without notice to or consent
of the Lenders.  The Lenders acknowledge
that, pursuant to such activities, JPMCB or its Affiliates may receive
information regarding any Loan Party or its Affiliates (including information
that may be subject to confidentiality obligations in favor of such Loan Party
or such Affiliate) and acknowledge that the Administrative Agent and the
Collateral Agent shall be under no obligation to provide such information to
them.  With respect to its Loans, JPMCB
shall have the same rights and powers under this Agreement as any other Lender
and may exercise such rights and powers as though it were not the
Administrative Agent, the L/C Issuer, the Swing Line Lender or a Collateral
Agent, and the terms “Lender” and “Lenders” include JPMCB in its individual
capacity.

Section 9.09 
Successor Agents.   Each of the Administrative Agent and the
Collateral Agent may resign as Administrative Agent (as to one or more Classes)
or Collateral Agent, as applicable, upon 30 days’ notice to the Lenders and the
Borrower; provided that any such resignation by JPMCB shall also
constitute its resignation as L/C Issuer and Swing Line Lender.  Upon any such resignation by the
Administrative Agent, the Required Lenders of the applicable Class or Classes
shall have the right to appoint a successor Administrative Agent.  Upon any such resignation by the Collateral
Agent, the Required Lenders shall have the right to appoint a successor
Collateral Agent.  If no successor Agent
shall have been so appointed, and shall have accepted such appointment, within
30 days after the retiring Agent’s giving of notice of resignation, then the
retiring Agent may, on behalf of the Lenders of the applicable Class or
Classes, appoint a successor Administrative Agent or Collateral Agent , as the
case may be, selected from among the Lenders, in the case of the resignation of
the Administrative Agent, the Lenders, in the case of the resignation of the
Collateral Agent.  In any case, such
appointment shall be subject to the prior written approval of the Borrower
(which approval may not be unreasonably withheld and shall not be required upon
the occurrence and during the continuance of an Event of Default).  Upon the acceptance of any appointment as
Administrative Agent or Collateral Agent by a successor Agent, such successor
Agent 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 under this Agreement and the other
Loan Documents.  Prior to any retiring
Agent’s resignation hereunder as Administrative Agent or Collateral Agent, the
retiring Agent shall take such action as may be reasonably necessary to assign
to the successor Agent its rights as Administrative Agent or Collateral Agent,
as the case may be, under the Loan Documents. 
After such resignation, the retiring Agent shall continue to have the
benefit of this Article IX as to any actions taken or omitted to be
taken by it while it was an Agent under this Agreement and the other Loan
Documents.  If no successor
Administrative Agent or Collateral Agent is appointed prior to the effective
date of the resignation of the Administrative 

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Agent or Collateral Agent, the resigning Agent may appoint, after consulting
with the Lenders of the applicable Class or Classes and the Borrower, a
successor agent from among the Lenders of the applicable Class or Classes.  Upon the acceptance of its appointment as
successor Agent hereunder, the Person acting as such successor Agent shall
succeed to all the rights, powers and duties of the retiring Agent (and, if
applicable, L/C Issuer and Swing Line Lender) and the respective terms “Administrative
Agent,” “L/C Issuer,” “Swing Line Lender,” and “Collateral
Agent” shall mean such successor Administrative Agent, Letter of Credit
Issuer, Swing Line Lender or Collateral Agent, and the retiring Administrative
Agent’s appointment, powers and duties as Administrative Agent shall be
terminated, the retiring L/C Issuer’s and Swing Line Lender’s rights, powers
and duties as such shall be terminated and the retiring Collateral Agent’s
rights, powers and duties as such shall be terminated shall be terminated,
without any other or further act or deed on the part of such retiring
Administrative Agent, L/C Issuer or Swing Line Lender or any other Lender,
other than the obligation of the successor L/C Issuer to issue letters of
credit in substitution for the Letters of Credit, if any, outstanding at the
time of such succession or to make other arrangements satisfactory to the
retiring L/C Issuer to effectively assume the obligations of the retiring L/C
Issuer with respect to such Letters of Credit. 
After any retiring Administrative Agent’s or Collateral Agent’s
resignation hereunder as Administrative Agent or Collateral Agent, as
applicable, the provisions of this Article IX and Sections 10.04
and 10.05 shall inure to its benefit as to any actions taken or omitted
to be taken by it while it was Administrative Agent or Collateral Agent under
this Agreement.  If no successor
administrative agent has accepted appointment as Administrative Agent by the
date which is 30 days following a retiring Administrative Agent’s notice of
resignation, the retiring Administrative Agent’s resignation shall nevertheless
thereupon become effective and the Lenders shall perform all of the duties of
the Administrative Agent hereunder until such time, if any, as the Required
Lenders appoint a successor agent as provided for above.  If no successor Collateral Agent has accepted
appointment as Collateral Agent by the date which is 30 days following a
retiring Collateral Agent’s notice of resignation, the retiring Collateral
Agent’s resignation shall nevertheless thereupon become effective and the
Lenders shall perform all of the duties of the Collateral Agent hereunder until
such time, if any, as the Required Lenders appoint a successor agent as
provided for above.

Section 9.10 
Administrative Agent May
File Proofs of Claim.  In case of the pendency of any receivership,
insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment,
composition or other judicial proceeding relative to any Loan Party, the
Administrative Agent (irrespective of whether the principal of any Loan or L/C
Obligation shall then be due and payable as herein expressed or by declaration
or otherwise and irrespective of whether the Administrative Agent shall have
made any demand on the Borrower) shall be entitled and empowered, by
intervention in such proceeding or otherwise:

(i)            to file and prove a
claim for the whole amount of the principal and interest owing and unpaid in
respect of the Loans, L/C Obligations and all other Senior Credit Obligations
that are owing and unpaid and to file such other documents as may be necessary
or advisable in order to have the claims of the Lenders and the Administrative
Agent (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Lenders and the Administrative Agent and
their respective agents and counsel and all other amounts due the Lenders and
the Administrative Agent under Sections 2.09 and 10.04) allowed
in such judicial proceeding; and

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

and any custodian,
receiver, assignee, trustee, liquidator, sequestrator or other similar official
in any such judicial proceeding is hereby authorized by each Lender to make
such payments to the Administrative Agent and, in the event that the Administrative
Agent shall consent to the making of such payments 

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directly to the Lenders,
to pay to the Administrative Agent any amount due for the reasonable
compensation, expenses, disbursements and advances of the Administrative Agent
and its agents and counsel, and any other amounts due the Administrative Agent
under Sections 2.09 and 10.04.

Nothing contained herein
shall be deemed to authorize the Administrative Agent to authorize or consent
to or accept or adopt on behalf of any Lender any plan of reorganization,
arrangement, adjustment or composition affecting the Senior Credit Obligations
or the rights of any Lender or to authorize the Administrative Agent to vote in
respect of the claim of any Lender in any such proceeding.

Section 9.11 
Collateral and Guaranty
Matters.

(a)           Actions Taken by Agents or Required Lenders.  Each Lender and each L/C Issuer agrees that
any action taken by the Collateral Agent or the Required Lenders (or, where
required by the express terms of this Agreement, a greater or lesser proportion
of the Lenders) in accordance with the provisions of this Agreement or of the
other Loan Documents, and the exercise by the Collateral Agent or Required
Lenders (or, where so required, such greater or lesser proportion) of the
powers set forth herein or therein, together with such other powers as are
reasonably incidental thereto, shall be authorized and binding upon all of the
Lenders, L/C Issuers, Senior Credit Parties. 
Without limiting the generality of the foregoing, (i) the Administrative
Agent shall have the sole and exclusive right and authority to act as the
disbursing and collecting agent for the Lenders and the L/C Issuers with
respect to all payments and collections arising in connection herewith and with
the Collateral Documents, (ii) the Collateral Agent shall have the sole
authority to (A) execute and deliver each Collateral Document and accept
delivery of each such agreement delivered by the Holdings, the Borrower or any
of its Subsidiaries, (B) act as Collateral Agent for the Lenders, the L/C
Issuers, the Senior Credit Parties for purposes of the perfection of all
security interests and Liens created by such agreements and all other purposes
stated therein, provided, however, that the Collateral Agent
hereby appoints, authorizes and directs each Lender and L/C Issuer to act as
collateral sub-agent for the Collateral Agent, the Lenders and the L/C Issuers
for purposes of the perfection of all security interests and Liens with respect
to the Collateral, including any deposit accounts maintained by a Loan Party
with, and cash and Cash Equivalents held by, such Lender or such L/C Issuer,
(C) manage, supervise and otherwise deal with the Collateral, (D) take such
action as is necessary or desirable to maintain the perfection and priority of
the security interests and Liens created or purported to be created by the
Collateral Documents and (E) except as may be otherwise specifically restricted
by the terms hereof or of any other Loan Document, exercise to the exclusion of
the Finance Parties all remedies given to the Collateral Agent , the Lenders,
the L/C Issuers, the other Senior Credit Parties with respect to the Collateral
under the Loan Documents relating thereto, applicable law or otherwise.

(b)           Certain Actions in Respect of Security Interests and
Guaranties.  The Lenders
irrevocably authorize the Administrative Agent, at its option and in its
discretion:

(i)            to release any Lien
on any property granted to or held by the Administrative Agent or the
Collateral Agent under any Loan Document (A) upon termination of the
Commitments and payment in full of all Senior Credit Obligations (other than
contingent indemnification obligations) and the expiration or termination of
all Letters of Credit, (B) that is sold or to be sold as part of or in connection
with any sale permitted hereunder or under any other Loan Document, or (C)
subject to Section 10.01, if approved, authorized or ratified in writing
by the Required Lenders;

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(ii)           to subordinate any
Lien on any property granted to or held by the Administrative Agent or the
Collateral Agent under any Loan Document to the holder of any Lien on such
property that is permitted by Section 7.02(xvi) and (xxiii); and

(iii)          to release any
Guarantor from its obligations under the Guaranty if such Person ceases to be a
Subsidiary as a result of a transaction permitted hereunder.

(c)           Upon
request by the Administrative Agent at any time, the Required Lenders will
confirm in writing the Administrative Agent’s authority to release or
subordinate its interest in particular types or items of property, or to
release any Guarantor from its obligations under the Guaranty pursuant to this Section
9.11.

Section 9.12 
Related Obligations.  The benefit of the Loan Documents and of the
provisions of this Agreement relating to the Collateral shall extend to and be
available in respect of any Cash Management Obligations and to any Swap
Obligations permitted hereunder from time to time owing to one or more Swap
Creditors (collectively, “Related Obligations”) solely on the condition
and understanding, as among the Collateral Agent and all Finance Parties, that
(i) the Related Obligations shall be entitled to the benefit of the Loan
Documents and the Collateral to the extent expressly set forth in this
Agreement and the other Loan Documents and to such extent the Collateral Agent
shall hold, and have the right and power to act with respect to, the Guaranty
and the Collateral on behalf of and as agent for the holders of the Related
Obligations, but the Collateral Agent are otherwise acting solely as agent for
the Lenders and the L/C Issuers and shall have no fiduciary duty, duty of
loyalty, duty of care, duty of disclosure or other obligation whatsoever to any
holder of Related Obligations, (ii) all matters, acts and omissions relating in
any manner to the Guaranty, the Collateral, or the omission, creation,
perfection, priority, abandonment or release of any Lien, shall be governed
solely by the provisions of this Agreement and the other Loan Documents and no
separate Lien, right, power or remedy shall arise or exist in favor of any
Finance Party under any separate instrument or agreement or in respect of any
Related Obligation, (iii) each Finance Party shall be bound by all actions
taken or omitted, in accordance with the provisions of this Agreement and the
other Loan Documents, by the Collateral Agent and the Required Lenders, each of
whom shall be entitled to act at its sole discretion and exclusively in its own
interest given its own Commitments and its own interest in the Loans, L/C
Obligations and other Senior Credit Obligation to it arising under this
Agreement or the other Loan Documents, without any duty or liability to any
Swap Creditor or holder of Cash Management Obligations or as to any Related
Obligation and without regard to whether any Related Obligation remains
outstanding or is deprived of the benefit of the Collateral or becomes
unsecured or is otherwise affected or put in jeopardy thereby, (iv) no holder
of Related Obligations and no other Finance Party (except the Lenders to the
extent set forth in this Agreement) shall have any right to be notified of, or
to direct, require or be heard with respect to, any action taken or omitted in
respect of the Collateral or under this Agreement or the Loan Documents and (v)
no holder of any Related Obligation shall exercise any right of setoff, banker’s
lien or similar right except to the extent provided in Section 10.09 and
then only to the extent such right is exercised in compliance with Section
2.13.

Section 9.13 
Other Agents; Arrangers
and Managers.  None of the Lenders or other Persons
identified on the facing page or signature pages of this Agreement as a “syndication
agent,” “documentation agent,” “co-documentation agent,” “co-agent,” “book
manager,” “lead manager,” “arranger,” “lead arranger” or “co-arranger” shall
have any right, power, obligation, liability, responsibility or duty under this
Agreement other than, in the case of such Lenders, those applicable to all
Lenders as such.  Without limiting the
foregoing, none of the Lenders or other Persons so identified shall have or be
deemed to have any fiduciary relationship with any Lender.  Each Lender acknowledges that it has not
relied, and will not rely, on any of the Lenders or other Persons so identified
in deciding to enter into this Agreement or in taking or not taking action
hereunder.

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Section 9.14 
Agents’ Fees; Arranger Fee.   The Borrower shall pay to the Administrative
Agent for its own account, to the Collateral Agent for its own account and to
the Joint Lead Arrangers, in their capacities as Joint Lead Arrangers, for
their own accounts, fees in the amounts and at the times previously agreed upon
between the Borrower and the Administrative Agent, the Collateral Agent and
such Joint Lead Arrangers, respectively, in each case with respect to this
Agreement, the other Loan Documents and the transactions contemplated hereby
and thereby.

ARTICLE X

MISCELLANEOUS

Section 10.01 
Amendments, Etc.

(a)           Amendments Generally.  No amendment or waiver of any provision of
this Agreement or any other Loan Document, and no consent to any departure by
any Loan Party therefrom, shall in any event be effective unless the same shall
be in writing and (i) in the case of any such waiver or consent, signed by the
Required Lenders (or by the Administrative Agent with the consent of the
Required Lenders), (ii) in the case of any amendment necessary to implement the
terms of a Facilities Increase in accordance with the terms of Section
2.10(a) hereof, by the Borrower and the Administrative Agent and (iii) in
the case of any other amendment, by the Required Lenders (or by the
Administrative Agent with the consent of the Required Lenders) and the
Borrower, and each such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given; provided
that the Administrative Agent and the Borrower may, with the consent of the
other, amend, modify or supplement this Agreement and any other Loan Document
to cure any ambiguity, typographical error, defect or inconsistency if such
amendment, modification or supplement does not adversely affect the rights of
any Agent, any Lender or any L/C Issuer.

(b)           Amendments and Waivers Pertinent to Affected Lenders.  Notwithstanding paragraph (a) above
and in addition to any other consent that may be required thereunder, no
amendment, waiver or consent shall:

(i)            waive any condition
set forth in Section 4.01(a) without the written consent of each Lender,
except with respect to a condition based upon another provision hereof, the
waiver of which requires only the concurrence of the Required Lenders and, in
the case of the conditions specified in Section 4.01, subject to the
provisions of Section 4.02;

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

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

(iv)          reduce the principal
of, or the rate of interest specified herein on, any Loan or unreimbursed L/C
Disbursement, or any fees or other amounts payable hereunder or under any other
Loan Document without the written consent of each Lender directly affected
thereby; provided, however, that only the consent of the Required
Lenders shall be necessary (A) to amend the definition of “Default Rate” or to
waive any obligation of the Borrower to pay interest or Letter of Credit Fees
at the Default Rate or (B) to amend any financial covenant hereunder (or any
defined term used therein) even if the effect of such amendment would be to 

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reduce the
rate of interest on any Loan or any unreimbursed L/C Disbursement or to reduce
any fee payable hereunder;

(v)           change (A) Section
2.13 or Section 8.03 in a manner that would alter the pro rata
sharing of payments required thereby without the written consent of each Lender
or (B) the order of application of any prepayment of Loans or any reduction in
the Commitments between the Classes of Loans from the application thereof set
forth in the applicable provisions of Section 2.09(b) or 2.10(c),
respectively, in any manner that materially and adversely affects the Lenders
under such Class without the written consent of (x) if such Class is the Term B
Lenders, the Required Term B Lenders and (y) if such Class is the Revolving
Lenders, the Required Revolving Lenders;

(vi)          change any provision
of this Section or the definition of “Required Lenders” “Required
Revolving Lenders”, or “Required Term B Lenders” or any other
provision hereof specifying the number or percentage of Lenders required to
amend, waive or otherwise modify any rights hereunder or make any determination
or grant any consent hereunder, without the written consent of each Lender
which is a Lender of the applicable Class so specified, in each case other than
as part of a Facilities Increase for which the conditions specified in Section
4.05 are satisfied;

(vii)         release all or
substantially all of the value of the Guaranty without the written consent of
each Lender (provided that the Administrative Agent may, without the
consent of any Lender, release any Guarantor (or all or substantially all of
the assets of a Guarantor) that is sold or transferred in compliance with Section
7.05);

(viii)        release all or
substantially all of the Collateral securing the Senior Credit Obligations
hereunder without the written consent of each Lender (provided that the
Collateral Agent may, without consent from any Lender, release any Collateral
that is sold or transferred by a Loan Party in compliance with Section 7.05
or released in compliance with Section 9.11(b) and exercise all rights
and remedies against the Collateral as provided by the Collateral Documents or
as otherwise permitted by Law);

(ix)           amend, modify or
waive the conditions to funding any Revolving Loan or Swing Line Loan or to
issuing any Letter of Credit in each case after the Closing Date, without the
written consent of Required Revolving Lenders;

(x)            (A) modify the
application of payments to the Revolving Loans pursuant to Section 2.09(b)
or the reduction of the Revolving Commitments pursuant to Section 2.10(c)
or (d) without the written consent of the Required Revolving Lenders, or
(B) modify the application of payments to the Term B Loans pursuant to Section
2.09(b) without the written consent of the Required Term B Lenders;

(xi)           (A) affect the
rights or duties of the L/C Issuer under this Agreement or any Letter of Credit
Request relating to any Letter of Credit issued or to be issued by it, without
the written consent of the L/C Issuer, (B) affect the rights or duties of the
Swing Line Lender under this Agreement, without the written consent of the
Swing Line Lender or (C) affect the rights or duties of the Administrative
Agent under this Agreement or any other Loan Document, without the written
consent of the Administrative Agent;

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(xii)          amend, modify or
waive Section 10.07(h) without the consent of each Granting Lender all
or any part of whose Loans are being funded by an SPC at the time of such
amendment, modification or waiver; or

(xiii)         other than as
contemplated by Section 9.11(b)(ii), subordinate any Lien on the
Collateral to the Lien of any other creditor of the Borrower or any other Loan
Party.

(c)           Defaulting Lenders.  Notwithstanding anything to the contrary
herein, no Defaulting Lender shall have any right to approve or disapprove any
amendment, waiver or consent hereunder, except that the Commitment of such
Lender may not be increased or extended without the consent of such Lender.

Each Lender and each
holder of a Note shall be bound by any waiver, amendment or modification
authorized by this Section 10.01 regardless of whether its Note shall
have been marked to make reference therein, and any consent by any Lender or
holder of a Note pursuant to this Section 10.01 shall bind any Person
subsequently acquiring a Note from it, whether or not such Note shall have been
so marked.

Section 10.02 
Notices and Other Communications; Facsimile Copies.

(a)           General.  Unless otherwise expressly provided herein,
all notices and other communications provided for hereunder shall be in writing
(including by facsimile transmission). 
All such written notices shall be mailed certified or registered mail,
faxed or delivered to the applicable address, facsimile number or (subject to
subsection (c) below) electronic mail address, and all notices and other
communications expressly permitted hereunder to be given by telephone shall be
made to the applicable telephone number, as follows:

(i)            if to the Borrower,
the Administrative Agent, a L/C Issuer, the Swing Line Lender or a Collateral
Agent, to the address, facsimile number, electronic mail address or telephone
number specified for such Person on Schedule 10.02 or to such other
address, facsimile number, electronic mail address or telephone number as shall
be designated by such party in a notice to the other parties; and

(ii)           if to any other
Lender, to the address, facsimile number, electronic mail address or telephone
number specified in its Administrative Questionnaire or to such other address,
facsimile number, electronic mail address or telephone number as shall be
designated by such party in a notice to the Borrower, the Administrative Agent,
such L/C Issuer and the Swing Line Lender.

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

(b)           Electronic Communications.  Notices and other communications to the
Lenders hereunder may be delivered or furnished by electronic communication
(including e-mail and Internet or intranet websites) pursuant to procedures
approved by the Administrative Agent, provided that the foregoing shall
not apply to notices to any Lender pursuant to Article II if such Lender
has notified the Administrative Agent that it is incapable of receiving notices
under such Article by electronic 

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communication.  The
Administrative Agent or the Borrower may, in its discretion, agree to accept notices
and other communications to it hereunder by electronic communications pursuant
to procedures approved by it, provided that approval of such procedures may be
limited to particular notices or communications.

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

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

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

Section 10.04 
Attorney Costs, Expenses
and Taxes.  Holdings and the Borrower jointly and
severally agree (i) to pay or reimburse the Administrative Agent for all costs
and expenses incurred in connection with the development, preparation,
negotiation and execution of this Agreement and the other Loan Documents and
any amendment, waiver, consent or other modification of the provisions hereof
and thereof (whether or not the transactions contemplated hereby or thereby are
consummated), and the consummation and administration of the transactions
contemplated hereby and thereby, including all Attorney Costs, and (ii) to pay
or reimburse the Administrative Agent, the Collateral Agent and each Lender for
all costs and expenses incurred in connection with the enforcement, attempted
enforcement, or preservation of any rights or remedies under this Agreement or
the other Loan Documents (including all such costs and expenses incurred during
any “workout” or restructuring in respect of the Senior Credit Obligations and
during any legal proceeding, including any proceeding under any Debtor Relief
Law), including all Attorney Costs); provided that the Borrower shall not
be required to reimburse the legal fees and expenses of more than one outside
counsel (in addition to up to one local counsel in each applicable local
jurisdiction) for all Persons indemnified under this clause (ii) unless,
in the written opinion of outside counsel reasonably satisfactory to the
Borrower and the Administrative Agent, representation of all such indemnified
persons would be inappropriate due to the existence of an actual or potential
conflict of interest.  The foregoing
costs and expenses shall include all search, filing, recording, title insurance
and appraisal charges and fees and taxes related thereto, and other
out-of-pocket expenses incurred by any Agent and the cost of independent public
accountants and other outside experts retained by or on behalf of any Agent or
any Lender.  All amounts due under this Section
10.04 shall be 

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payable within ten Business Days after demand therefor.  The agreements in this Section 10.04
shall survive the termination of the Commitments and repayment of all Senior
Credit Obligations.

Section 10.05 
Indemnification. 
Whether or not the transactions contemplated hereby are consummated,
Holdings and the Borrower, jointly and severally, agree to indemnify and hold
harmless each Agent-Related Person, each Lender and their respective
Affiliates, directors, officers, employees, counsel, agents and, in the case of
any Funds, trustees and investment advisors and attorneys-in-fact (collectively
the “Indemnitees”) from and against any and all liabilities, obligations,
losses, damages, penalties, claims, demands, actions, judgments, suits, costs,
expenses and disbursements (including Attorney Costs) of any kind or nature
whatsoever which may at any time be imposed on, incurred by or asserted against
any such Indemnitee in any way relating to or arising out of or in connection
with (i) the execution, delivery, enforcement, performance or administration of
any Loan Document or any other agreement, letter or instrument delivered in
connection with the transactions contemplated thereby or the consummation of
the transactions contemplated thereby, (ii) any Commitment, Loan or Letter of
Credit or the use or proposed use of the proceeds therefrom (including any
refusal by the L/C Issuer to honor a demand for payment under a Letter of
Credit if the documents presented in connection with such demand do not
strictly comply with the terms of such Letter of Credit), (iii) any actual or
alleged presence or Release of Hazardous Materials on or from any property
currently or formerly owned or operated by the Borrower, any Subsidiary or any
other Loan Party, or any Environmental Liability related in any way to the
Borrower, any Subsidiary or any other Loan Party, or (iv) any actual or
prospective claim, litigation, investigation or proceeding relating to any of
the foregoing, whether based on contract, tort or any other theory (including
any investigation of, preparation for, or defense of any pending or threatened
claim, investigation, litigation or proceeding) and regardless of whether any
Indemnitee is a party thereto (all the foregoing, collectively, the “Indemnified
Liabilities”); provided that such indemnity shall not, as to any
Indemnitee, be available to the extent that such liabilities, obligations,
losses, damages, penalties, claims, demands, actions, judgments, suits, costs,
expenses or disbursements are determined by a court of competent jurisdiction
by final and nonappealable judgment to have resulted from the bad faith, gross
negligence or willful misconduct of such Indemnitee or from a material breach
by such Indemnitee of its obligations under the Loan Documents; and provided
further that the Borrower shall not be required to reimburse the legal
fees and expenses of more than one outside counsel (in addition to any
reasonably necessary special counsel and up to one local counsel in each
applicable local jurisdiction) for all Indemnitees unless, in the written
opinion of outside counsel reasonably satisfactory to the Borrower and the
Administrative Agent, representation of all such Indemnitees would be
inappropriate due to the existence of an actual or potential conflict of
interest.  No Indemnitee shall be liable
for any damages arising from the use by others of any information or other materials
obtained through IntraLinks or other similar information transmission systems
in connection with this Agreement, nor shall any Indemnitee have any liability
for any indirect or consequential damages relating to this Agreement or any
other Loan Document or arising out of its activities in connection herewith or
therewith (whether before or after the Closing Date).  All amounts due under this Section 10.05
shall be payable within ten Business Days after demand therefor.  Each of Holdings and the Borrower agrees not
to assert or to permit any of their respective Subsidiaries to assert any claim
against any Agent, any Lender, any of their Affiliates or any of their
respective directors, officers, employees, attorneys, agents and advisers, and
each of the Agents, and the Lenders agree not to assert or permit any of their
respective Subsidiaries to assert any claim against Holdings, the Borrower or
any of their respective Subsidiaries or any of their respective directors,
officers, employees, attorneys, agents or advisors, on any theory of liability,
for special, indirect, consequential or punitive damages arising out of or
otherwise relating to the Loan Documents, any of the transactions contemplated
herein or therein or the actual or proposed use of the proceeds of the Loans or
of the Letters of Credit.  The agreements
in this Section shall survive the resignation of the Administrative Agent and
any Collateral Agent, the replacement of any Lender, the termination of the
Commitments and the repayment, satisfaction or discharge of all the other Finance
Obligations

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

Section 10.07 
Successors and Assigns.

(a)           Generally.  The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns permitted hereby, except that the Borrower
may not assign or otherwise transfer any of its rights or obligations hereunder
without the prior written consent of each Lender and no Lender may assign or
otherwise transfer any of its rights or obligations hereunder except (i) to an
Eligible Assignee in accordance with the provisions of subsection (b) of
this Section, (ii) by way of participation in accordance with the provisions of
subsection (d) of this Section, (iii) by way of pledge or assignment of
a security interest subject to the restrictions of subsection (f) of
this Section or (iv) to an SPC in accordance with the provisions of subsection
(h) of this Section (and any other attempted assignment or transfer by any
party hereto shall be null and void). 
Nothing in this Agreement, expressed or implied, shall be construed to
confer upon any Person (other than the parties hereto, their respective
successors and assigns permitted hereby, Participants to the extent provided in
subsection (d) of this Section and, to the extent expressly contemplated
hereby, the Indemnitees) any legal or equitable right, remedy or claim under or
by reason of this Agreement.

(b)           Assignments.  Any Lender may at any time assign to one or
more Eligible Assignees all or a portion of its rights and obligations under
this Agreement (including, without limitation, all or a portion of its Loans,
its Notes, its Commitments and any Participation Interest in Letters of Credit
and Swing Line Loans held by it); provided, however, that:

(i)            except in the case
of an assignment to another Lender, an Affiliate of an existing Lender or any
Approved Fund, (A) the aggregate amount of the Revolving Commitment of the
assigning Lender subject to such assignment (determined as of the date the
Assignment and Assumption with respect to such assignment is delivered to the
Administrative Agent) shall not, without the consent of the Administrative
Agent and, if no Default or Event of Default has occurred and is continuing,
the Borrower, be less than $5,000,000 and an integral multiple of $1,000,000
(or such lesser amount as shall equal the assigning Lender’s entire Revolving
Commitment), (B) the aggregate amount of any Term B Loans of an assigning
Lender subject to each such assignments (determined as of the date the Assignment
and Assumption with respect to such assignment is delivered to the
Administrative Agent or, if “Trade Date” is specified in the Assignment and
Assumption, as of the Trade Date) shall not, without the consent of the
Administrative Agent and, if no Default or Event of Default has occurred and is
continuing, the Borrower, be less (with respect to Term B Loans) than
$1,000,000 (or such lesser amount as shall equal the assigning Lender’s entire
Term B Loans owing to it) and (C) after giving effect to such assignment, the
aggregate amount of the Revolving Commitment of and Term B Loans at the time
owing to the assigning Lender shall not, without the consent of the Borrower if
no Default or 

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Event of
Default has occurred and is continuing, be less than $1,000,000 (unless the
assigning Lender shall have assigned its entire Revolving Commitment and all
the Term B Loans at the time owing it pursuant to such assignment or
assignments otherwise complying with this Section 10.07 executed
substantially simultaneously with such assignment); provided, however,
that concurrent assignments to members of an Assignee Group and concurrent
assignments from members of an Assignee Group to a single Eligible Assignee (or
to an Eligible Assignee and members of its Assignee Group) will be treated as a
single assignment for purposes of determining whether any such minimum amount
has been met;

(ii)           each partial
assignment shall be made as an assignment of a proportionate part of all the
assigning Lenders’ rights and obligations under this Agreement with respect to
the Loans or the Commitment assigned;

(iii)          any assignment of a
Commitment must be approved by the Administrative Agent unless the proposed
assignee is itself a Lender (whether or not the proposed assignee would otherwise
qualify as an Eligible Assignee);

(iv)          the parties to such
assignment shall execute and deliver to the Administrative Agent and, only with
respect to any assignment of all or a portion of the Revolving Committed
Amount, the L/C Issuers for their acceptance an Assignment and Assumption in
the form of Exhibit C, together with any Note subject to such assignment
and to the Administrative Agent a processing and recordation fee of $3,500;

(v)           if applicable, the
assignee shall deliver to the Administrative Agent the information referred to
in Section 10.19(b).

Subject to acceptance and
recording thereof by the Administrative Agent pursuant to subsection (c)
of this Section, from and after the effective date specified in each Assignment
and Assumption, the Eligible Assignee thereunder shall be a party to this
Agreement and, to the extent of the interest assigned by such Assignment and
Assumption, have the rights and obligations of a Lender under this Agreement,
and the assigning Lender thereunder shall, to the extent of the interest
assigned by such Assignment and Assumption, be released from its obligations
under this Agreement (and, in the case of an Assignment and Assumption covering
all of the assigning Lender’s rights and obligations under this Agreement, such
Lender shall cease to be a party hereto but shall continue to be entitled to
the benefits of Sections 3.01, 3.04, 3.05, 10.04, 10.05
and 10.22 with respect to facts and circumstances occurring prior to the
effective date of such assignment).  Upon
request, the Borrower (at its expense) shall execute and deliver a Note or
Notes to the assignee Lender.  Any
assignment or transfer by a Lender of rights or obligations under this
Agreement that does not comply with this subsection shall be treated for
purposes of this Agreement as a sale by such Lender of a participation in such
rights and obligations in accordance with subsection (d) of this
Section.

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

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(d)           Participations.  Any Lender may at any time, without the
consent of, or notice to, the Borrower or the Administrative Agent, sell
participations to any Person (other than a natural person or the Borrower or
any of the Borrower’s Affiliates or Subsidiaries) (each, a “Participant”)
in all or a portion of such Lender’s rights and/or obligations under this
Agreement (including all or a portion of its Commitment and/or the Loans
(including such Lender’s participations in L/C Obligations and/or Swing Line
Loans) owing to it); provided that (i) such Lender’s obligations under
this Agreement shall remain unchanged, (ii) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations
and (iii) the Borrower, the Administrative Agent, the Collateral Agent and the
other Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender’s rights and obligations under this Agreement.  Any agreement or instrument pursuant to which
a Lender sells such a participation shall provide that such Lender shall retain
the sole right to enforce this Agreement and to approve any amendment,
modification or waiver of any  provision
of this Agreement.  Subject to subsection
(e) of this Section, the Borrower agrees that each Participant shall be
entitled to the benefits of Sections 3.01, 3.04 and 3.05
to the same extent as if it were a Lender and had acquired its interest by
assignment pursuant to subsection (b) of this Section.  To the extent permitted by law, each
Participant also shall be entitled to the benefits of Section 10.09 as
though it were a Lender, provided such Participant agrees to be subject to Section
2.13 as though it were a Lender.

(e)           Limitation on Certain Rights of Participants.  A Participant shall not be entitled to
receive any greater payment under Section 3.01 or 3.04 than the
applicable Lender would have been entitled to receive with respect to the
participation sold to such Participant, unless the sale of the participation to
such Participant is made with the Borrower’s prior written consent.  A Participant that would be a Foreign Lender
if it were a Lender shall not be entitled to the benefits of Section 3.01
unless the Borrower is notified of the participation sold to such Participant
and such Participant agrees, for the benefit of the Borrower, to comply with Section
10.15 as though it were a Lender.

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

(g)           Certain Definitions.  As used herein, the following terms have the
following meanings:

“Eligible Assignee” means (i) a Lender, (ii) an
Affiliate of a Lender, (iii) an Approved Fund and (iv) any other Person (other
than a natural Person) approved by (A) the Administrative Agent, (B) in the
case of any assignment of a Revolving Commitment, the L/C Issuers and the Swing
Line Lender and (C) unless (x) such Person is taking delivery of an assignment
in connection with physical settlement of a credit derivatives transaction or
(y) a Default or an Event of Default has occurred and is continuing at the time
any assignment is effected pursuant to Section 10.07(b), the Borrower
(each such approval not to be unreasonably withheld, conditioned or delayed and
any such approval required of the Borrower to be deemed given by the Borrower
if no objection from the Borrower is received by the assigning Lender and the
Administrative Agent within two Business Days after notice of such proposed
assignment has been provided by the assigning Lender to the Borrower); provided,
however, that (i) if JPMCB or one or more of its Affiliates is a L/C
Issuer, any assignment of a Revolving Commitment (including any assignment to a
Lender, an Affiliate of a Lender or an Approved Fund) shall require its
consent, (ii) none of Holdings and its Affiliates shall qualify as Eligible
Assignees; and provided, further, that no Person shall be an
Eligible Assignee if such Person appears on the list of Specially Designated
Nationals and Blocked Persons prepared by the U.S. Treasury 

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Department’s Office of
Foreign Assets Control or the purchase by such Person of an assignment or the
performance by any Agent of its duties under the Loan Documents with respect to
such Person violates or would violate any Anti-Terrorism Law.

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

“Approved Fund” means any Fund that is
administered or managed by (i) a Lender, its parent company or Subsidiary of
either, (ii) an Affiliate of a Lender or (iii) an entity or an Affiliate of an
entity that administers or manages a Lender.

(h)           Other Funding Vehicles.  Notwithstanding anything to the contrary
contained herein, any Lender (a “Granting Lender”) may grant to a
special purpose funding vehicle identified as such in writing from time to time
by the Granting Lender to the Administrative Agent and the Borrower (an “SPC”)
the option to provide all or any part of any Loan that such Granting Lender
would otherwise be obligated to make pursuant to this Agreement; provided
that (i) nothing herein shall constitute a commitment by any SPC to fund any
Loan, and (ii) if an SPC elects not to exercise such option or otherwise fails
to make all or any part of such Loan, the Granting Lender shall be obligated to
make such Loan pursuant to the terms hereof or, if it fails to do so, to make
such payment to the Administrative Agent as is required under Section
2.03(b).  Each party hereto hereby
agrees that (i) neither the grant to any SPC nor the exercise by any SPC of
such option shall increase the costs or expenses or otherwise increase or
change the obligations of the Borrower under this Agreement (including its
obligations under Section 3.04), (ii) no SPC shall be liable for any
indemnity or similar payment obligation under this Agreement for which a Lender
would be liable, and (iii) the Granting Lender shall for all purposes,
including the approval of any amendment, waiver or other modification of any
provision of any Loan Document, remain the lender of record hereunder.  The making of a Loan by an SPC hereunder
shall utilize the Commitment of the Granting Lender to the same extent, and as
if, such Loan were made by such Granting Lender.  In furtherance of the foregoing, each party
hereto hereby agrees (which agreement shall survive the termination of this
Agreement) that, prior to the date that is one year and one day after the
payment in full of all outstanding commercial paper or other Finance
Obligations of any SPC, it will not institute against, or join any other Person
in instituting against, such SPC any bankruptcy, reorganization, arrangement,
insolvency, or liquidation proceeding under the laws of the United States or
any State thereof.  Notwithstanding
anything to the contrary contained herein, any SPC may (i) with notice to, but
without prior consent of the Borrower and the Administrative Agent and with the
payment of a processing fee of $3,500, assign all or any portion of its right
to receive payment with respect to any Loan to the Granting Lender and (ii)
disclose on a confidential basis any non-public information relating to its
funding of Loans to any rating agency, commercial paper dealer or provider of
any surety or guaranty or credit or liquidity enhancement to such SPC.

(i)            Certain Assignments by JPMCB.  Notwithstanding anything to the contrary
contained herein, if at any time JPMCB assigns all of its Commitment and Loans
pursuant to subsection (b) above, JPMCB may, (i) upon 30 days’ notice to
the Borrower and the Lenders, resign as L/C Issuer and/or (ii) upon 30 days’
notice to the Borrower, resign as Swing Line Lender.  In the event of any such resignation as L/C
Issuer or Swing Line Lender, the Borrower shall be entitled to appoint from
among the Lenders a successor L/C Issuer or Swing Line Lender hereunder; provided,
however, that no failure by the Borrower to appoint any such successor
shall affect the resignation of JPMCB as L/C Issuer or Swing Line Lender, as
the case may be.  If JPMCB resigns as L/C
Issuer, it shall retain all the rights and obligations of the L/C Issuer
hereunder with respect to all Letters of Credit outstanding as of the effective
date of its resignation as L/C Issuer and all L/C Obligations with respect
thereto (including the right to require the Lenders to make Base Rate Loans or
purchase Participation Interests in Letters of Credit and 

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L/C Obligations pursuant to Section 2.05 (d)).  If JPMCB resigns as Swing Line Lender, it
shall retain all the rights of the Swing Line Lender provided for hereunder
with respect to Swing Line Loans made by it and outstanding as of the effective
date of such resignation, including the right to require the Lenders to make
Base Rate Loans or Purchase Participation Interests in outstanding Swing Line
Loans pursuant to Section 2.01(c)(vi).

Section 10.08 
Confidentiality. 
(a)  Each of the Administrative
Agent, the Collateral Agent and the Lenders agrees to maintain the
confidentiality of the Information (as defined below), except that Information
may be disclosed (i) to its Affiliates and to it and its Affiliates’ respective
partners, directors, officers, employees, agents, advisors and representatives
(it being understood that the Persons to whom such disclosure is made will be
informed of the confidential nature of such Information and instructed to keep
such Information confidential); (ii) to the extent requested by any regulatory
authority purporting to have jurisdiction over it (in which case the
Administrative Agent, the Collateral Agent or such Lender, as applicable, shall
use reasonable efforts to notify the Borrower prior to such disclosure, in any
case including any self-regulatory authority, such as the National Association
of Insurance Commissioners); (iii) to the extent required by applicable Laws or
regulations or by any subpoena or similar legal process; (iv) to any other
party to this Agreement; (v) in connection with the exercise of any remedies
hereunder or under any other Loan Document or any action or proceeding relating
to this Agreement or any other Loan Document or the enforcement of rights
hereunder or thereunder, (vi) subject to an agreement containing provisions
substantially the same as those of this Section, to (A) any assignee of or
Participant in, or any prospective assignee of or Participant in, any of its
rights or obligations under this Agreement, (B) any pledgee referred to in Section
10.07(f) or (C) any actual or prospective counterparty (or its advisors) to
any swap or derivative transaction relating to the Borrower and its
obligations, (vii) with the consent of the Borrower or (viii) to the extent
such Information (A) becomes publicly available other than as a result of a
breach of this Section or (B) becomes available to the Administrative Agent or
any Lender on a nonconfidential basis from a source other than the
Borrower.  For purposes of this Section, “Information”
means all information received from the Borrower or any of its Subsidiaries
relating to the Borrower or  any
Subsidiary or any of their respective businesses, other than any such information
that is available to the Administrative Agent or any Lender on a
nonconfidential basis prior to disclosure by the Borrower or any Subsidiary, provided
that, in the case of information received from the Borrower or any Subsidiary
after the date hereof, such information is clearly identified at the time of
delivery as confidential.  Any Person
required to maintain the confidentiality of Information as provided in this
Section shall be considered to have complied with its obligation to do so if
such Person has exercised the same degree of care to maintain the
confidentiality of such Information as such Person would accord to its own
confidential information. 
Notwithstanding the foregoing, any Agent and any Lender may place
advertisements in financial and other newspapers and periodicals or on a home
page or similar place for dissemination of information on the Internet or
worldwide web as it may choose, and circulate similar promotional materials,
after the closing of the transactions contemplated by this Agreement in the
form of a “tombstone” or otherwise describing the names of the Loan Parties, or
any of them, and the amount, type and closing date of such transactions, all at
their sole expense.

(b)           EACH
LENDER ACKNOWLEDGES THAT INFORMATION AS DEFINED IN SECTION 10.08(a)
FURNISHED TO IT PURSUANT TO THIS AGREEMENT MAY INCLUDE MATERIAL NON-PUBLIC
INFORMATION CONCERNING THE BORROWER AND ITS RELATED PARTIES OR THEIR RESPECTIVE
SECURITIES, AND CONFIRMS THAT IT HAS DEVELOPED COMPLIANCE PROCEDURES REGARDING
THE USE OF MATERIAL NON-PUBLIC INFORMATION AND THAT IT WILL HANDLE SUCH
MATERIAL NON-PUBLIC INFORMATION IN ACCORDANCE WITH THOSE PROCEDURES AND
APPLICABLE LAW, INCLUDING FEDERAL AND STATE SECURITIES LAWS.

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(c)           ALL
INFORMATION, INCLUDING REQUESTS FOR WAIVERS AND AMENDMENTS, FURNISHED BY THE
BORROWER OR THE ADMINISTRATIVE AGENT PURSUANT TO, OR IN THE COURSE OF
ADMINISTERING, THIS AGREEMENT WILL BE SYNDICATE-LEVEL INFORMATION, WHICH MAY
CONTAIN MATERIAL NON-PUBLIC INFORMATION ABOUT THE BORROWER, THE OTHER LOAN PARTIES
AND THEIR RELATED PARTIES OR THEIR RESPECTIVE SECURITIES.  ACCORDINGLY, EACH LENDER REPRESENTS TO THE
BORROWER AND THE ADMINISTRATIVE AGENT THAT IT HAS IDENTIFIED IN ITS
ADMINISTRATIVE QUESTIONNAIRE A CREDIT CONTACT WHO MAY RECEIVE INFORMATION THAT
MAY CONTAIN MATERIAL NON-PUBLIC INFORMATION IN ACCORDANCE WITH ITS COMPLIANCE
PROCEDURES AND APPLICABLE LAW.

Section 10.09 
Set-off. 
In addition to any rights now or hereafter granted under applicable Law
or otherwise, and not by way of limitation of any such rights, upon the
occurrence and during the continuance of an Event of Default, after obtaining
the prior written consent of the Administrative Agent, each Lender (and each of
its Affiliates) is authorized at any time and from time to time, without presentment,
demand, protest or other notice of any kind (all of such rights being hereby
expressly waived), to set-off and to appropriate and apply any and all deposits
(general or specific) and any other indebtedness at any time held or owing by
such Lender (including, without limitation, branches, agencies or Affiliates of
such Lender wherever located) to or for the credit or the account of any Loan
Party against obligations and liabilities of such Loan Party to the Lenders
hereunder, under the Notes, under the other Loan Documents or otherwise,
irrespective of whether the Administrative Agent or the Lenders shall have made
any demand hereunder and although such obligations, liabilities or claims, or
any of them, may be contingent or unmatured or denominated in a currency
different from that of the applicable deposit or indebtedness, and any such
set-off shall be deemed to have been made immediately upon the occurrence of an
Event of Default even though such charge is made or entered on the books of
such Lender subsequent thereto.  The Loan
Parties hereby agree that to the extent permitted by law any Person purchasing
a participation in the Loans, Commitments and L/C Obligations hereunder
pursuant to Section 2.01(c),  2.05(d), 2.13 or 10.07(d)
may exercise all rights of set-off with respect to its participation interest
as fully as if such Person were a Lender hereunder and any such set-off shall
reduce the amount owed by such Loan Party to the Lender.

Section 10.10 
Interest Rate Limitation.  Notwithstanding anything herein to the
contrary, if at any time the interest rate applicable to any Loan, together
with all fees, charges and other amounts that are treated as interest on such
Loan under applicable Law (collectively, the “Charges”), shall exceed
the maximum lawful rate (the “Maximum Rate”) that may be charged or
contracted for, charged or otherwise received by the Lender holding such Loan
in accordance with applicable Law, the rate of interest payable in respect of
such Loan hereunder, together with all Charges payable in respect thereof,
shall be limited to the Maximum Rate and, to the extent lawful, the interest
and Charges that would have been payable in respect of such Loan but were not
payable as a result of the operation of this Section 10.09, shall be cumulated
and the interest and Charges payable to such Lender in respect of other Loans
or periods shall be increased (but not above the Maximum Rate therefor) until
such Lender shall have received such cumulated amount, together with interest
thereon at the Federal Funds Rate to the date of payment.

Section 10.11 
Counterparts. 
This Agreement may be executed in any number of counterparts, each of
which when so executed and delivered shall be an original, but all of which
shall constitute one and the same instrument. It shall not be necessary in
making proof of this Agreement to produce or account for more than one such
counterpart.

Section 10.12 
Integration. 
This Agreement, together with the other Loan Documents, comprises the
complete and integrated agreement of the parties on the subject matter hereof
and thereof 

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and supersedes all prior agreements, written or oral, on such subject
matter.  In the event of any conflict
between the provisions of this Agreement and those of any other Loan Document,
the provisions of this Agreement shall control; provided that the
inclusion of supplemental rights or remedies in favor of the Administrative
Agent, the Collateral Agent or the Lenders in any other Loan Document shall not
be deemed a conflict with this Agreement. 
Each Loan Document was drafted with the joint participation of the
respective parties thereto and shall be construed neither against nor in favor
of any party, but rather in accordance with the fair meaning thereof.

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

Section 10.14 
Severability. 
If any provision of this Agreement or the other Loan Documents is held
to be illegal, invalid or unenforceable, (i) the legality, validity and
enforceability of the remaining provisions of this Agreement and the other Loan
Documents shall not be affected or impaired thereby and (ii) the parties shall
endeavor in good faith negotiations to replace the illegal, invalid or
unenforceable provisions with valid provisions the economic effect of which
comes as close as possible to that of the illegal, invalid or unenforceable
provisions.  The invalidity of a
provision in a particular jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.

Section 10.15 
Tax Forms.

(a)           Certain Provisions Pertinent to Foreign Lenders.

(i)            Each Lender that is
not a “United States person” within the meaning of Section 7701(a)(30) of the
Code (a “Foreign Lender”) shall deliver to the Administrative Agent,
prior to receipt of any payment subject to withholding under the Code (or upon
accepting an assignment of an interest herein), two duly signed completed
copies of whichever of the following forms is applicable: (A) Internal Revenue
Service Form W-8BEN, certifying that such Foreign Lender is entitled to benefits
under an income tax treaty to which the United States is a party that reduces
to zero the rate of withholding on payments of interest; (B) Internal Revenue
Service Form W-8ECI; (C) Internal Revenue Service Form W-8IMY (including all
appropriate attachments); (D) in the case of a Foreign Lender claiming the
benefits of the exemption for portfolio interest under Section 881(c) of the
Code, (x) a certificate to the effect that such Foreign Lender is not (1) a “bank”
within the meaning of Section 881(c)(3)(A) of the Code, (2) a “10 percent
shareholder” of the Borrower within the meaning of Section 881(c)(3)(B) of the
Code, or (3) a “controlled foreign corporation” described in Section
881(c)(3)(C) of the Code and (y) duly completed copies of Internal Revenue
Service Form W-8BEN; or (E) any other form or certificate required by any
taxing authority (including any certificate required by Section 871(h) of the
Internal Revenue Code), certifying that such Foreign Lender is entitled to an
exemption from tax on payments pursuant to this Agreement or any other Loan
Document.  Thereafter and from time to
time, each such Foreign Lender shall (A) promptly submit to the Administrative
Agent such additional duly completed and signed copies of one of such forms (or
such successor forms as shall be adopted from time to time by the relevant
United States taxing authorities) as may then be available under then current
United States laws and regulations to avoid, or such evidence as is 

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satisfactory
to the Borrower and the Administrative Agent of any available exemption from,
United States withholding taxes in respect of all payments to be made to such
Foreign Lender by the Borrower pursuant to this Agreement, (B) promptly notify
the Administrative Agent of any change in circumstances which would modify or
render invalid any claimed exemption or reduction, and (C) if the Borrower is
required to pay any additional amount to or for the account of such Lender
pursuant to Section 3.01 hereof, then such Lender will use reasonable efforts
to change the jurisdiction of its Applicable Lending office if, in the judgment
of such Lender, such change would (x) eliminate or reduce any such additional
payment which may thereafter accrue, (y) not subject such Lender to any
unreimbursed cost or expense and (z) not be otherwise disadvantageous to such
Lender.

(ii)           Each Foreign
Lender, to the extent it does not act or ceases to act for its own account with
respect to any portion of any sums paid or payable to such Lender under any of
the Loan Documents (for example, in the case of a typical participation by such
Lender), shall deliver to the Administrative Agent on the date when such
Foreign Lender ceases to act for its own account with respect to any portion of
any such sums paid or payable, and at such other times as may be necessary in
the determination of the Administrative Agent (in the reasonable exercise of
its discretion), (A) two duly signed completed copies of the forms or
statements required to be provided by such Lender as set forth above, to
establish the portion of any such sums paid or payable with respect to which
such Lender acts for its own account that is not subject to U.S. withholding
tax, and (B) two duly signed completed copies of IRS Form W-8IMY (or any
successor thereto), together with any information such Lender chooses to
transmit with such form, and any other certificate or statement of exemption
required under the Code, to establish that such Lender is not acting for its
own account with respect to a portion of any such sums payable to such Lender.

(iii)          The Borrower shall
not be required to pay any additional amount to any Foreign Lender under Section
3.01 (A) with respect to any Taxes required to be deducted or withheld on
the basis of the information, certificates or statements of exemption such
Lender transmits with an IRS Form W-8IMY pursuant to this Section 10.15(a)
or (B) if such Lender shall have failed to satisfy the foregoing provisions of
this Section 10.15(a); provided that if such Lender shall have
satisfied the requirement of this Section 10.15(a) on the date such
Lender became a Lender or ceased to act for its own account with respect to any
payment under any of the Loan Documents, nothing in this Section 10.15(a)
shall relieve the Borrower of its obligation to pay any amounts pursuant to Section
3.01 in the event that, as a result of any change in any applicable law,
treaty or governmental rule, regulation or order, or any change in the
interpretation, administration or application thereof, such Lender is no longer
properly entitled to deliver forms, certificates or other evidence at a
subsequent date establishing the fact that such Lender or other Person for the
account of which such Lender receives any sums payable under any of the Loan
Documents is not subject to withholding or is subject to withholding at a
reduced rate.

(iv)          The Administrative
Agent may, without reduction, withhold any Taxes required to be deducted and
withheld from any payment under any of the Loan Documents with respect to which
the Borrower is not required to pay additional amounts under this Section
10.15(a).

(b)           Certain Provisions Pertinent to US Lenders.  Upon the request of the Administrative Agent,
each Lender that is a “United States person” within the meaning of Section
7701(a)(30) of the Code shall deliver to the Administrative Agent two duly
signed completed copies of IRS Form W-9. 
If such Lender fails to deliver such forms, then the Administrative
Agent may withhold 

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from any interest payment to such Lender an amount equivalent to the
applicable back-up withholding tax imposed by the Code, without reduction.

(c)           Lender Indemnification.  If any Governmental Authority asserts that
the Administrative Agent did not properly withhold or backup withhold, as the
case may be, any tax or other amount from payments made to or for the account
of any Lender and such failure to withhold or backup withhold was directly
caused by such Lender’s failure to comply with Section 10.15(a)(i) or (ii)
hereof, such Lender shall indemnify the Administrative Agent therefor,
including all penalties and interest, any taxes imposed by any jurisdiction on
the amounts payable to the Administrative Agent under this Section, and costs
and expenses (including Attorney Costs) of the Administrative Agent.  The obligation of the Lenders under this
Section shall survive the termination of the Commitments, repayment of all
other Senior Credit Obligations hereunder and the resignation of the
Administrative Agent.

Section 10.16 
Headings. 
The headings of the sections and subsections hereof are provided for
convenience only and shall not in any way affect the meaning or construction of
any provision of this Agreement.

Section 10.17 
Governing Law; Submission to Jurisdiction.

(a)           THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS (OTHER THAN LETTERS OF CREDIT AND OTHER
THAN AS EXPRESSLY SET FORTH IN SUCH OTHER LOAN DOCUMENTS) AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE GOVERNED BY AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF
NEW YORK (INCLUDING, WITHOUT LIMITATION, SECTION 5-1401 OF THE GENERAL
OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT REGARD TO CONFLICTS OF LAWS
PRINCIPLES.  EACH LETTER OF CREDIT SHALL
BE GOVERNED BY, AND SHALL BE CONSTRUED IN ACCORDANCE WITH, THE LAWS OR RULES
DESIGNATED IN SUCH LETTER OF CREDIT, OR IF NO SUCH LAWS OR RULES ARE
DESIGNATED, THE UNIFORM CUSTOMS AND PRACTICE FOR DOCUMENTARY CREDITS (1993
REVISION), INTERNATIONAL CHAMBER OF COMMERCE, PUBLICATION NO. 500 AND, AS TO
MATTERS NOT GOVERNED BY SUCH UNIFORM CUSTOMS, THE INTERNAL LAWS OF THE STATE OF
NEW YORK (INCLUDING, WITHOUT LIMITATION, SECTION 5-1401 OF THE GENERAL
OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT REGARD TO CONFLICTS OF LAWS
PRINCIPLES.

(b)           Any
legal action or proceeding with respect to this Agreement or any other Loan
Document may be brought in the courts of the State of New York in New York
County, or of the United States for the Southern District of New York, and, by
execution and delivery of this Agreement, each of Holdings and the Borrower
hereby irrevocably accepts for itself and in respect of its property, generally
and unconditional, the nonexclusive jurisdiction of such courts.  Each of Holdings and the Borrower irrevocably
waives, to the fullest extent permitted by Law, any objection which it may now
or hereafter have to the laying of the venue of any such proceeding brought in
such court and any claim that any such proceeding brought in any such court has
been brought in an inconvenient forum.

Section 10.18 
Waiver of Right to Trial
by Jury.  EACH PARTY TO THIS AGREEMENT HEREBY EXPRESSLY
WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF
ACTION ARISING UNDER ANY LOAN DOCUMENT OR IN ANY WAY CONNECTED WITH OR RELATED
OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH RESPECT
TO ANY LOAN DOCUMENT, OR THE TRANSACTIONS RELATED THERETO, IN EACH CASE WHETHER
NOW EXISTING OR HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT OR TORT OR
OTHERWISE; 

 141
 

 

AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND,
ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND
THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF
THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE
SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.

Section 10.19 
USA Patriot Act Notice;
Lenders’ Compliance Certification.

(a)           Notice to Borrower.  Each Lender and the Administrative Agent (for
itself and not on behalf of any Lender) hereby notifies Holdings and the
Borrower that pursuant to the requirements of the US Patriot Act it may be
required to obtain, verify and record information that identifies each of
Holdings and the Borrower, which information includes the name and address of
each Loan Party and other information that will allow such Lender or the
Administrative Agent, as applicable, to identify each such Loan Party in
accordance with the Act.

(b)           Lenders’ Certification.  Each Lender or assignee or participant of a
Lender that is not incorporated under the Laws of the United States or a State
thereof (and is not excepted from the certification requirement contained in
Section 313 of the U.S. Patriot Act and the applicable regulations because it
is both (i) an Affiliate of a depository institution or foreign bank that
maintains a physical presence in the United States or foreign country and (ii)
subject to supervision by a banking regulatory authority regulating such
affiliated depository institution or foreign bank) shall deliver to the
Administrative Agent the certification or, if applicable, recertification,
certifying that such Lender is not a “shell” and certifying to other matters as
required by Section 313 of the U.S. Patriot Act and the applicable regulations
thereunder: (i) within 10 days after the Closing Date or, if later, the date
such Lender, assignee or participant of a Lender becomes a Lender, assignee or
participant of a Lender hereunder and (ii) at such other times as are required
under the U.S. Patriot Act.

Section 10.20 
Defaulting Lenders.  Each Lender understands and agrees that if
such Lender is a Defaulting Lender then, notwithstanding the provisions of Section
10.03, it shall not be entitled to vote on any matter requiring the consent
of the Required Lenders or to object to any matter requiring the consent of all
the Lenders adversely affected thereby; provided, however, that
all other benefits and obligations under the Loan Documents shall apply to such
Defaulting Lender, except as provided in Section 2.03(e).

Section 10.21 
Binding Effect. 
This Agreement shall become effective at such time when it shall have
been executed by Holdings, the Borrower, the Collateral Agent and the
Administrative Agent, and the Administrative Agent shall have received copies
hereof (telefaxed or otherwise) which, when taken together, bear the signatures
of each Lender, and thereafter this Agreement shall be binding upon and inure
to the benefit of Holdings, the Borrower, each Agent and each Lender and their respective
successors and assigns; provided, however, unless the conditions
set forth in Section 4.01 have been satisfied by the Loan Parties or
waived by the Lenders on or before October 31, 2006, none of Holdings, the
Borrower, any Agent or the Lenders shall have any obligations under this
Agreement.

Section 10.22 
Judgment Currency.

(a)           The
obligations of the Loan Parties hereunder and under the other Loan Documents to
make payments in a specified currency (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 a Finance Party of the full amount of the Obligation
Currency expressed to be payable to it under this Agreement or another Loan
Document.  If, for the purpose of
obtaining or 

 142
 

 

enforcing judgment against any 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 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 Business Day
immediately preceding the date 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
Borrower covenants and agrees to pay, or cause to be paid, or remit, or cause
to be remitted, 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 any rate of exchange or currency equivalent for this Section
10.23, such amounts shall include any premium and costs payable in connection
with the purchase of the Obligation Currency.

Section 10.23 
Conflict.  To the extent that there is a
conflict or inconsistency between any provision hereof, on the one hand, and
any provision of any other Loan Document, on the other hand, this Agreement
shall control.

[Signature Pages Follow]

 143

 

 

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.

	
  

  	
  VERIFONE INTERMEDIATE HOLDINGS, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Barry Zwarenstein

  
	
   

  	
   

  	
  Name: Barry Zwarenstein

  
	
   

  	
   

  	
  Title: Chief Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
  VERIFONE, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Barry Zwarenstein

  
	
   

  	
   

  	
  Name: Barry Zwarenstein

  
	
   

  	
   

  	
  Title: Chief Financial Officer

  
	
   

  	
   

  	
   

  

 

 S-1
 

 

 

	
  

  	
  JPMORGAN CHASE BANK, N.A., as L/C Issuer

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Bruce Borden

  
	
   

  	
   

  	
  Name: Bruce Borden

  
	
   

  	
   

  	
  Title: Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
  JPMORGAN
  CHASE BANK, N.A., as Swing Line Lender

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Bruce Borden

  
	
   

  	
   

  	
  Name: Bruce Borden

  
	
   

  	
   

  	
  Title: Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
  JPMORGAN
  CHASE BANK, N.A., as Administrative Agent

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Bruce Borden

  
	
   

  	
   

  	
  Name: Bruce Borden

  
	
   

  	
   

  	
  Title: Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
  JPMORGAN CHASE BANK, N.A., as Collateral Agent

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Bruce Borden

  
	
   

  	
   

  	
  Name: Bruce Borden

  
	
   

  	
   

  	
  Title: Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
  JPMORGAN CHASE BANK, N.A., as an initial Lender

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Bruce Borden

  
	
   

  	
   

  	
  Name: Bruce Borden

  
	
   

  	
   

  	
  Title: Vice President

  

 

 S-2
 

 

 

	
  

  	
   

  	
   

  
	
   

  	
  LEHMAN COMMERCIAL PAPER INC.,

  
	
   

  	
  as Syndication Agent

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Laurie Perper

  
	
   

  	
   

  	
  Name: Laurie Perper

  
	
   

  	
   

  	
  Title: Senior Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
  LEHMAN COMMERCIAL PAPER INC.,

  
	
   

  	
  as an initial Lender

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Laurie Perper

  
	
   

  	
   

  	
  Name: Laurie Perper

  
	
   

  	
   

  	
  Title: Senior Vice President

  

 

 S-3
 

 

 

	
  

  	
   

  	
   

  
	
   

  	
  BANK LEUMI USA,

  
	
   

  	
  as a Co-Documentation Agent and
  as an initial Lender

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Yuval Talmy

  
	
   

  	
   

  	
  Name: Yuval Talmy

  
	
   

  	
   

  	
  Title: First Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Dr. Avram Keusch

  
	
   

  	
   

  	
  Name: Dr. Avram Keusch

  
	
   

  	
   

  	
  Title: Vice President

  

 

 S-4
 

 

 

	
  

  	
   

  	
   

  
	
   

  	
  WELLS FARGO BANK, N.A.,

  
	
   

  	
  as a Co-Documentation Agent and
  as an initial Lender

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  s/s David G. James

  
	
   

  	
   

  	
  Name: David G. James

  
	
   

  	
   

  	
  Title: Senior Vice President

  

 

 

 S-5

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