Document:

<PAGE>
                                                                    EXHIBIT 10.7

            AMENDMENT NO. 1 TO SEPARATION AND DISTRIBUTION AGREEMENT

                  The Separation and Distribution Agreement (the "Agreement")
dated as of August 2, 2005, by and between Gray Television, Inc., a Georgia
corporation ("Gray"), and Triple Crown Media, Inc., a Delaware corporation
("TCM") is hereby amended as follows:

          The following new Section 6.7 is added:

                   "Section 6.7     Acquisition of Michiana Telecasting Corp.

                   If, prior to the Separation, and in connection with Gray's
                   acquisition of Michiana Telecasting Corp., an Indiana
                   corporation ("Michiana"), Gray Publishing (a) sells The
                   Goshen News, the net proceeds from the sale will be retained
                   by Gray Publishing in the Separation, or (b) swaps The Goshen
                   News for another newspaper, that newspaper will be retained
                   by Gray Publishing in the Separation, and as a result will be
                   an asset of TCM following the Separation. If, after the
                   Separation, Gray acquires Michiana, TCM shall cause Gray
                   Publishing to sell The Goshen News or swap The Goshen News
                   for another newspaper, which would not result in a violation
                   of the FCC's cross ownership rules, upon the written request
                   of Gray (the "Written Request"); provided that such request
                   is made in connection with Gray's acquisition of Michiana and
                   is necessary to comply with the FCC's cross ownership rules.
                   The Written Request shall specify the date by which the sale
                   or swap must be completed, which date shall not be less than
                   60 days from the date of the Written Request."

         Section 7.2 is amended to read as follows:

                  "TCM shall indemnify, defend, and hold harmless Gray and its
                  Subsidiaries, and each of their respective directors,
                  officers, employees, counsel, and agents (the "Gray
                  Indemnitees") from and against any and all Indemnifiable
                  Losses incurred or suffered by any Gray Indemnitee in
                  connection with any Action or threatened Action and arising
                  out of or due to, directly or indirectly, (i) the Newspaper
                  Publishing Business, (ii) Graylink Wireless Business, (iii)
                  the Assigned Contracts, (iv) the Assigned Real Property, or
                  (v) any failure to perform, or violation of, any provision of
                  this Agreement or any Ancillary Agreement that is to be
                  performed or complied with by TCM or its Subsidiaries,
                  including any failure by TCM to cause Gray Publishing to sell
                  or swap The Goshen News within the time period specified in a
                  Written Request."

          Except as provided in this Amendment No. 1 to Separation and
Distribution Agreement, the Agreement shall remain in effect without any change.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                       1

<PAGE>

                  IN WITNESS WHEREOF, the parties have executed and delivered
this Amendment No. 1 to Separation and Distribution Agreement effective as of
November 18, 2005.

                             GRAY TELEVISION, INC.

                             By: /s/ Robert S. Prather, Jr.
                                 ----------------------------------------------
                                 Name: Robert S. Prather, Jr.
                                 Title: President and Chief Operating Officer

                             TRIPLE CROWN MEDIA, INC.

                             By: /s/ James C. Ryan
                                 ----------------------------------------------
                                 Name: James C. Ryan
                                 Title: Chief Financial Officer and Secretaryexv4w1

 

EXHIBIT
4.1

 

 

     
The Corporation will furnish without charge to each stockholder who so requests a
statement of the powers, designations, preferences and relative, participating, optional or other
special rights of each class of stock of the Corporation or series thereof and the qualifications,
limitations or restrictions of such preferences and/or rights.

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

	 	 	 	 	 	 	 
	TEN COM
	 	—	 	as tenants in common	 	UNIF TRAN MIN
ACT--...................................Custodian............................
	TEN ENT
	 	—	 	as tenants by the entireties	 	                              (Cust)        
                                (Minor)
	JT TEN
	 	—	 	as joint tenants with rights of survivorship	 	under Uniform Transfers to Minors
	 
	 	 	 	and not as tenants in common	 	          Act..................................
	 
	 	 	 	 	 	                    (State)

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

 

For value received,___________hereby sell, assign and transfer unto

PLEASE INSERT SOCIAL SECURITY OR OTHER

     IDENTIFYING NUMBER OF ASSIGNEE

     

     

      

 

(PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE)

 

 

 

shares of the capital stock represented by the within Certificate, and do hereby irrevocably constitute and appoint

 

Attorney to transfer the
said stock on the books of the within named Corporation with full power of substitution in the premises.

Dated________________________

      

	 	 	 	 	 
	 

	 	 	 	 
	 

	 	NOTICE:
	 	THE SIGNATURE TO THIS ASSIGNMENT MUST
CORRESPOND WITH THE NAME(S) AS WRITTEN UPON THE FACE
OF THE CERTIFICATE IN EVERY PARTICULAR, WITHOUT
ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATEVER.

      

Signature(s) Guaranteed:

      

By_____________________________________________________________________

THE SIGNATURE(S) MUST BE GUARANTEED BY AN
ELIGIBLE GUARANTOR
INSTITUTION (BANKS,
STOCKBROKERS, SAVINGS AND LOAN
ASSOCIATIONS AND
CREDIT UNIONS WITH MEMBERSHIP IN AN
APPROVED
SIGNATURE GUARANTEE MEDALLION PROGRAM), PURSUANT
TO
S.E.C. RULE 17Ad-15.Exhibit 10.1

 

H&E Equipment Services, LLC

Loan Agreement - GECC

June 2002

 

 

Execution Copy

 

 

H&E EQUIPMENT SERVICES L.L.C.,

 

and

 

GREAT NORTHERN EQUIPMENT, INC.,

as Borrowers,

 

THE OTHER CREDIT PARTIES SIGNATORY HERETO,

as Credit Parties,

 

THE LENDERS SIGNATORY HERETO

FROM TIME TO TIME,

as Lenders

 

GENERAL ELECTRIC CAPITAL CORPORATION,

as Arranger

 

BANK OF AMERICA, N.A.,

as Syndication Agent

 

FLEET CAPITAL CORPORATION,

as Documentation Agent

 

and

 

GENERAL ELECTRIC CAPITAL CORPORATION,

as Administrative Agent

 

 

CREDIT AGREEMENT

Dated as of June 17, 2002

 

 

 

TABLE OF CONTENTS

 

	
  Clause

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  1.

  	
  AMOUNT AND TERMS OF CREDIT

  	
   

  
	
   

  	
  1.1

  	
  Credit Facilities

  	
   

  
	
   

  	
  1.2

  	
  Letters of Credit

  	
   

  
	
   

  	
  1.3

  	
  Prepayments

  	
   

  
	
   

  	
  1.4

  	
  Use of Proceeds

  	
   

  
	
   

  	
  1.5

  	
  Interest
  and Applicable Margins

  	
   

  
	
   

  	
  1.6

  	
  Eligible Accounts

  	
   

  
	
  1.6A

  	
  Eligible
  Rolling Stock

  	
   

  
	
  1.6B

  	
  Eligible Rentals

  	
   

  
	
   

  	
  1.7

  	
  Eligible
  Parts and Tools Inventory

  	
   

  
	
  1.7A

  	
  Eligible Equipment
  Inventory

  	
   

  
	
   

  	
  1.8

  	
  Cash Management
  Systems

  	
   

  
	
   

  	
  1.9

  	
  Fees

  	
   

  
	
   

  	
  1.10

  	
  Receipt of Payments

  	
   

  
	
   

  	
  1.11

  	
  Application
  and Allocation of Payments

  	
   

  
	
   

  	
  1.12

  	
  Loan Account and
  Accounting

  	
   

  
	
   

  	
  1.13

  	
  Indemnity

  	
   

  
	
   

  	
  1.14

  	
  Access

  	
   

  
	
   

  	
  1.15

  	
  Taxes

  	
   

  
	
   

  	
  1.16

  	
  Capital
  Adequacy; Increased Costs; Illegality

  	
   

  
	
   

  	
  1.17

  	
  Single Loan

  	
   

  
	
  2.

  	
  CONDITIONS PRECEDENT

  	
   

  
	
   

  	
  2.1

  	
  Conditions to the
  Initial Loans

  	
   

  
	
   

  	
  2.2

  	
  Further
  Conditions to Each Loan

  	
   

  
	
  3.

  	
  REPRESENTATIONS
  AND WARRANTIES

  	
   

  
	
   

  	
  3.1

  	
  Corporate or
  Limited Liability Company Existence; Compliance with Law

  	
   

  
	
   

  	
  3.2

  	
  Executive
  Offices; Collateral Locations; FEIN

  	
   

  
	
   

  	
  3.3

  	
  Corporate or
  Limited Liability Company Power, Authorization, Enforceable Obligations

  	
   

  

 

i

 

	
   

  	
  3.4

  	
  Financial
  Statements and Projections

  	
   

  
	
   

  	
  3.5

  	
  Material Adverse Effect

  	
   

  
	
   

  	
  3.6

  	
  Ownership of
  Property; Liens

  	
   

  
	
   

  	
  3.7

  	
  Labor Matters

  	
   

  
	
   

  	
  3.8

  	
  Ventures,
  Subsidiaries and Affiliates; Outstanding Stock and Indebtedness

  	
   

  
	
   

  	
  3.9

  	
  Government Regulation

  	
   

  
	
   

  	
  3.10

  	
  Margin Regulations

  	
   

  
	
   

  	
  3.11

  	
  Taxes

  	
   

  
	
   

  	
  3.12

  	
  ERISA

  	
   

  
	
   

  	
  3.13

  	
  No Litigation

  	
   

  
	
   

  	
  3.14

  	
  Brokers

  	
   

  
	
   

  	
  3.15

  	
  Intellectual Property

  	
   

  
	
   

  	
  3.16

  	
  Full Disclosure

  	
   

  
	
   

  	
  3.17

  	
  Environmental Matters

  	
   

  
	
   

  	
  3.18

  	
  Insurance

  	
   

  
	
   

  	
  3.19

  	
  Deposit and
  Disbursement Accounts

  	
   

  
	
   

  	
  3.20

  	
  Government Contracts

  	
   

  
	
   

  	
  3.21

  	
  Customer and Trade
  Relations

  	
   

  
	
   

  	
  3.22

  	
  Agreements and
  Other Documents

  	
   

  
	
   

  	
  3.23

  	
  Solvency

  	
   

  
	
   

  	
  3.24

  	
  Contribution
  Agreement and Plan of Reorganization

  	
   

  
	
   

  	
  3.25

  	
  Status of Holdings

  	
   

  
	
   

  	
  3.26

  	
  Senior Debt

  	
   

  
	
  4.

  	
  FINANCIAL
  STATEMENTS AND INFORMATION

  	
   

  
	
   

  	
  4.1

  	
  Reports and Notices

  	
   

  
	
   

  	
  4.2

  	
  Communication
  with Accountants

  	
   

  
	
  5.

  	
  AFFIRMATIVE COVENANTS

  	
   

  
	
   

  	
  5.1

  	
  Maintenance of
  Existence and Conduct of Business

  	
   

  

 

ii

 

	
   

  	
  5.2

  	
  Payment of Charges

  	
   

  
	
   

  	
  5.3

  	
  Books and Records

  	
   

  
	
   

  	
  5.4

  	
  Insurance;
  Damage to or Destruction of Collateral

  	
   

  
	
   

  	
  5.5

  	
  Compliance with Laws

  	
   

  
	
   

  	
  5.6

  	
  Supplemental
  Disclosure

  	
   

  
	
   

  	
  5.7

  	
  Intellectual Property

  	
   

  
	
   

  	
  5.8

  	
  Environmental Matters

  	
   

  
	
   

  	
  5.9

  	
  Landlords’
  Agreements, Mortgagee Agreements, Bailee Letters, Real Estate Purchases and
  Vendor Inter-Creditor Agreements

  	
   

  
	
   

  	
  5.10

  	
  Government Accounts

  	
   

  
	
   

  	
  5.11

  	
  Further Assurances

  	
   

  
	
  6.

  	
  NEGATIVE COVENANTS

  	
   

  
	
   

  	
  6.1

  	
  Acquisitions,
  Subsidiaries, Etc.

  	
   

  
	
   

  	
  6.2

  	
  Investments;
  Loans and Advances

  	
   

  
	
   

  	
  6.3

  	
  Indebtedness

  	
   

  
	
   

  	
  6.4

  	
  Employee
  Loans and Affiliate Transactions

  	
   

  
	
   

  	
  6.5

  	
  Capital
  Structure and Business

  	
   

  
	
   

  	
  6.6

  	
  Guaranteed
  Indebtedness

  	
   

  
	
   

  	
  6.7

  	
  Liens

  	
   

  
	
   

  	
  6.8

  	
  Disposition
  of Stock and Assets

  	
   

  
	
   

  	
  6.9

  	
  ERISA

  	
   

  
	
   

  	
  6.10

  	
  Financial
  Covenants

  	
   

  
	
   

  	
  6.11

  	
  Hazardous
  Materials

  	
   

  
	
   

  	
  6.12

  	
  Designated
  Senior Debt

  	
   

  
	
   

  	
  6.13

  	
  Cancellation
  of Indebtedness

  	
   

  
	
   

  	
  6.14

  	
  Restricted
  Payments

  	
   

  
	
   

  	
  6.15

  	
  Change
  of Name or Location; Change of Fiscal Year

  	
   

  
	
   

  	
  6.16

  	
  No
  Impairment of Intercompany Transfers

  	
   

  
	
   

  	
  6.17

  	
  No
  Speculative Transactions

  	
   

  

 

iii

 

	
   

  	
  6.18

  	
  Changes
  Relating to Senior Debt; Subordinated Debt Designation of Credit Facility

  	
   

  
	
   

  	
  6.19

  	
  Changes
  in Depreciation Schedules

  	
   

  
	
   

  	
  6.20

  	
  Credit
  Parties Other than Borrowers

  	
   

  
	
   

  	
  6.21

  	
  Lock
  Box Remittances; Vendor Payments

  	
   

  
	
  7.

  	
  TERM

  	
   

  
	
   

  	
  7.1

  	
  Termination

  	
   

  
	
   

  	
  7.2

  	
  Survival
  of Obligations Upon Termination of Financing Arrangements

  	
   

  
	
   

  	
  7.3

  	
  Default
  Purchase Option

  	
   

  
	
  8.

  	
  EVENTS
  OF DEFAULT: RIGHTS AND REMEDIES

  	
   

  
	
   

  	
  8.1

  	
  Events
  of Default

  	
   

  
	
   

  	
  8.2

  	
  Remedies

  	
   

  
	
   

  	
  8.3

  	
  Waivers
  by Credit Parties

  	
   

  
	
  9.

  	
  ASSIGNMENT
  AND PARTICIPATIONS; APPOINTMENT OF AGENT

  	
   

  
	
   

  	
  9.1

  	
  Assignment
  and Participations

  	
   

  
	
   

  	
  9.2

  	
  Appointment
  of Agent

  	
   

  
	
   

  	
  9.3

  	
  Agent’s
  Reliance, Etc.

  	
   

  
	
   

  	
  9.4

  	
  GE
  Capital and Affiliates

  	
   

  
	
   

  	
  9.5

  	
  Lender
  Credit Decision

  	
   

  
	
   

  	
  9.6

  	
  Indemnification

  	
   

  
	
   

  	
  9.7

  	
  Successor
  Agent

  	
   

  
	
   

  	
  9.8

  	
  Co-Agents
  

  	
   

  
	
   

  	
  9.9

  	
  Setoff
  and Sharing of Payments

  	
   

  
	
   

  	
  9.10

  	
  Advances;
  Payments; Non-Funding Lenders; Information; Actions in Concert

  	
   

  
	
  10.

  	
  SUCCESSORS
  AND ASSIGNS

  	
   

  
	
   

  	
  10.1

  	
  Successors
  and Assigns

  	
   

  
	
  11.

  	
  MISCELLANEOUS

  	
   

  
	
   

  	
  11.1

  	
  Complete
  Agreement; Modification of Agreement

  	
   

  
	
   

  	
  11.2

  	
  Amendments
  and Waivers

  	
   

  

 

iv

 

	
   

  	
  11.3

  	
  Fees
  and Expenses

  	
   

  
	
   

  	
  11.4

  	
  No
  Waiver

  	
   

  
	
   

  	
  11.5

  	
  Remedies

  	
   

  
	
   

  	
  11.6

  	
  Severability

  	
   

  
	
   

  	
  11.7

  	
  Conflict
  of Terms

  	
   

  
	
   

  	
  11.8

  	
  Confidentiality

  	
   

  
	
   

  	
  11.9

  	
  Governing
  Law

  	
   

  
	
   

  	
  11.10

  	
  Notices

  	
   

  
	
   

  	
  11.11

  	
  Section Titles

  	
   

  
	
   

  	
  11.12

  	
  Counterparts

  	
   

  
	
   

  	
  11.13

  	
  Waiver
  of Jury Trial

  	
   

  
	
   

  	
  11.14

  	
  Press
  Releases and Related Matters

  	
   

  
	
   

  	
  11.15

  	
  Reinstatement

  	
   

  
	
   

  	
  11.16

  	
  Advice
  of Counsel

  	
   

  
	
   

  	
  11.17

  	
  No
  Strict Construction

  	
   

  
	
  12.

  	
  CROSS-GUARANTY

  	
   

  
	
   

  	
  12.1

  	
  Cross-Guaranty

  	
   

  
	
   

  	
  12.2

  	
  Waivers
  by Borrowers

  	
   

  
	
   

  	
  12.3

  	
  Benefit
  of Guaranty

  	
   

  
	
   

  	
  12.4

  	
  Subordination
  of Subrogation, Etc.

  	
   

  
	
   

  	
  12.5

  	
  Election
  of Remedies

  	
   

  
	
   

  	
  12.6

  	
  Limitation

  	
   

  
	
   

  	
  12.7

  	
  Contribution
  with Respect to Guaranty Obligations

  	
   

  
	
   

  	
  12.8

  	
  Liability
  Cumulative

  	
   

  

 

v

 

INDEX OF APPENDICES

 

	
  Exhibit l.l(a)(i)

  	
  -

  	
  Form of
  Notice of Revolving Credit Advance

  	
   

  
	
  Exhibit l.l(a)(ii)

  	
  -

  	
  Form of
  Revolving Note

  	
   

  
	
  Exhibit l.l(b)(ii)

  	
  -

  	
  Form of
  Swing Line Note

  	
   

  
	
  Exhibit l.5(e)

  	
  -

  	
  Form of
  Notice of Conversion/Continuation

  	
   

  
	
  Exhibit l.6B(a)

  	
  -

  	
  Form of
  Lease

  	
   

  
	
  Exhibit 4.l(b)

  	
  -

  	
  Form of
  Borrowing Base Certificate

  	
   

  
	
  Exhibit 6.7(d)(iii)(A)

  	
  -

  	
  Form of
  Intercreditor Agreement (Floor Plan Inventory)

  	
   

  
	
  Exhibit 6.7(d)(iii)(B)

  	
  -

  	
  Form of
  Intercreditor Agreement (Off Balance Sheet Inventory)

  	
   

  
	
  Exhibit 9.1(a)

  	
  -

  	
  Form of
  Assignment Agreement

  	
   

  
	
  Exhibit B-l(a)

  	
  -

  	
  Form of
  Notice of Issuance of Letter of Credit

  	
   

  
	
  Schedule 1.1

  	
  -

  	
  Responsible
  Individual

  	
   

  
	
  Schedule 1.4

  	
  -

  	
  Sources
  and Uses; Funds Flow Memorandum

  	
   

  
	
  Schedule 3.2

  	
  -

  	
  Executive
  Offices; FEIN

  	
   

  
	
  Schedule 3.4(A)

  	
  -

  	
  Financial
  Statements

  	
   

  
	
  Schedule 3.4(B)

  	
  -

  	
  Pro
  Forma

  	
   

  
	
  Schedule 3.4(C)

  	
  -

  	
  Projections

  	
   

  
	
  Schedule 3.4(D)

  	
  -

  	
  Fair
  Salable Balance Sheet

  	
   

  
	
  Schedule 3.4(E)

  	
  -

  	
  Financial
  Statements

  	
   

  
	
  Schedule 3.6

  	
  -

  	
  Real
  Estate and Leases

  	
   

  
	
  Schedule 3.7

  	
  -

  	
  Labor
  Matters

  	
   

  
	
  Schedule 3.8

  	
  -

  	
  Ventures,
  Subsidiaries and Affiliates; Outstanding Stock

  	
   

  
	
  Schedule 3.11

  	
  -

  	
  Tax
  Matters

  	
   

  
	
  Schedule 3.12

  	
  -

  	
  ERISA
  Plans

  	
   

  
	
  Schedule 3.13

  	
  -

  	
  Litigation

  	
   

  
	
  Schedule 3.15

  	
  -

  	
  Intellectual
  Property

  	
   

  
	
  Schedule 3.17

  	
  -

  	
  Hazardous
  Materials

  	
   

  
	
  Schedule 3.18

  	
  -

  	
  Insurance

  	
   

  
	
  Schedule 3.19

  	
  -

  	
  Deposit
  and Disbursement Accounts

  	
   

  
	
  Schedule 3.20

  	
  -

  	
  Government
  Contracts

  	
   

  
	
  Schedule 3.22

  	
  -

  	
  Material
  Agreements

  	
   

  
	
  Schedule 5.1

  	
  -

  	
  Trade
  Names

  	
   

  
	
  Schedule 5.9

  	
  -

  	
  Real
  Estate Liens

  	
   

  
	
  Schedule 6.2

  	
  -

  	
  Investments

  	
   

  
	
  Schedule 6.3

  	
  -

  	
  Indebtedness

  	
   

  
	
  Schedule 6.4(a)

  	
  -

  	
  Extraordinary
  Transactions

  	
   

  
	
  Schedule 6.4(b)

  	
  -

  	
  Transactions
  with Affiliates

  	
   

  
	
  Schedule 6.6

  	
  -

  	
  Guaranteed
  Indebtedness

  	
   

  
	
  Schedule 6.7

  	
  -

  	
  Existing
  Liens

  	
   

  
	
  Annex
  A (Recitals)

  	
  -

  	
  Definitions

  	
   

  
	
  Annex
  B (Section 1.2)

  	
  -

  	
  Letters
  of Credit

  	
   

  
	
  Annex
  C (Section 1.8)

  	
  -

  	
  Cash
  Management Systems

  	
   

  

 

vi

 

	
  Annex
  D (Section 2.1 (a))

  	
  -

  	
  Closing
  Checklist

  	
   

  
	
  Annex
  E (Section 4.l(a))

  	
  -

  	
  Financial
  Statements and Projections — Reporting

  	
   

  
	
  Annex
  F (Section 4.1(b))

  	
  -

  	
  Collateral
  Reports

  	
   

  
	
  Annex
  G (Section 6.10)

  	
  -

  	
  Financial
  Covenants

  	
   

  
	
  Annex
  H (Section 9.9(a))

  	
  -

  	
  Lenders’
  Wire Transfer Information

  	
   

  
	
  Annex
  I (Section 11.10)

  	
  -

  	
  Notice
  Addresses

  	
   

  

 

vii

 

CREDIT
AGREEMENT, dated as of June 17, 2002 (this “Credit Agreement”), among GREAT NORTHERN EQUIPMENT, INC., a
Montana corporation (“Great Northern”),
H&E EQUIPMENT SERVICES L.L.C., a Louisiana limited liability company
(f/k/a/ Gulf Wide Industries, L.L.C., a Louisiana limited liability company (“Gulf Wide”)) (“H&E” and
together with Great Northern, each individually, a “Borrower”,
and collectively and jointly and severally, the “Borrowers”),
the other Credit Parties signatory hereto, GENERAL ELECTRIC CAPITAL
CORPORATION, a Delaware corporation (in its individual capacity, “GE Capital”), for itself as Lender, as Administrative Agent
for the Lenders and the other Lenders signatory hereto from time to time,
GENERAL ELECTRIC CAPITAL CORPORATION, as Arranger (“Arranger”),
BANK OF AMERICA, N.A., as Syndication Agent (“Syndication
Agent”) and FLEET CAPITAL CORPORATION, as Documentation Agent (“Documentation Agent”).

 

WHEREAS:

 

(A)                              ICM Equipment Company, L.L.C., a Delaware
limited liability company (“ICM”), owns
all of the outstanding shares of capital stock of GNE Investments, Inc., a
Washington corporation (“GNE Investments”);

 

(B)                                GNE Investments owns all of the outstanding
shares of capital stock of Great Northern;

 

(C)                                H&E, owns all of the outstanding
membership interests of Head & Engquist Equipment L.L.C, a Louisiana
limited liability company (“Head & Engquist
Equipment”);

 

(D)                               Pursuant to that certain Contribution
Agreement and Plan of Reorganization dated as of June 14, 2002 (the “Contribution Agreement and Plan of Reorganization”) among
H&E Holdings L.L.C., a Delaware limited liability company (“H&E Holdings”), H&E, Head & Engquist Equipment,
ICM and the equity holders of ICM and H&E, all common and preferred equity
of ICM and H&E will be contributed to H&E Holdings (the “H&E Contribution”) in exchange for membership interests
in H&E Holdings so that H&E Holdings will own all of the outstanding membership
interests of ICM and H&E;

 

(E)                                 As provided in the Contribution Agreement and
Plan of Reorganization, immediately following the H&E Contribution, H&E
Holdings will contribute all of the membership interests in ICM to H&E so
that H&E will own all of the outstanding membership interests of ICM, and
immediately prior to the execution of this Credit Agreement, Head &
Engquist Equipment and ICM will merge with and into H&E (the “Mergers”);

 

(F)                                 Upon consummation of the Mergers, H&E
will own all of the outstanding shares of capital stock of (i) GNE
Investments, which will hold all of the outstanding shares of capital stock of
Great Northern and (ii) H&E Finance Corp., a Delaware corporation (“H&E Finance”), which is being organized prior to the
execution of this Credit Agreement for the purpose of entering into and consummating
the transactions under the Senior Note Indenture and Senior Subordinated Note Indenture
(as each such term is defined below);

 

 

(G)                                Borrowers have requested that Lenders extend
a revolving credit facility to Borrowers of up to One Hundred Fifty Million
Dollars ($150,000,000) in aggregate principal amount for the purpose of
refinancing certain indebtedness of Borrowers and to provide (a) working
capital financing for Borrowers, (b) funds for other general corporate purposes
of Borrowers and (c) funds for other purposes permitted hereunder, and for
these purposes, Lenders are willing to make certain loans and other extensions
of credit to Borrowers of up to such amount upon the terms and conditions set
forth herein;

 

(H)                               H&E and H&E Finance have agreed to
finance certain of its indebtedness through the issuance of (i) $200,000,000
of senior secured notes (together with any other senior notes issued pursuant
to the Senior Note Indenture, as amended, modified or supplemented from time to
time in accordance with their terms and the terms hereof, the “Senior Notes”) pursuant to an Indenture dated as of the
date hereof (as amended, modified or supplemented from time to time in
accordance with its terms and the terms hereof, the “Senior Note
Indenture”) among H&E, H&E Finance and Bank of New York, as
trustee and (ii) $50,000,000 of senior unsecured subordinated notes
(together with any other senior unsecured subordinated notes issued pursuant to
the Senior Subordinated Note Indenture, as amended, modified or supplemented
from time to time in accordance with their terms and the terms hereof, the “Senior Subordinated Notes”) pursuant to an Indenture dated
as of the date hereof (as amended, modified or supplemented from time to time
in accordance with its terms and the terms hereof, the “Senior
Subordinated Note Indenture”) among H&E, H&E Finance and
Bank of New York, as trustee;

 

(I)                                    Borrowers have agreed to secure all of their
obligations under the Loan Documents by granting to Agent, for the benefit of
Agent and Lenders, a security interest in and lien upon all of their existing
and after-acquired personal and real property;

 

(J)                                   GNE Investments, H&E Holdings and H&E
Finance are willing to guarantee all of the obligations of Borrowers to Agent
and Lenders under the Loan Documents and (i) H&E Holdings is willing
to pledge to Agent, for the benefit of Agent and Lenders, all of the membership
interests of H&E to secure such guaranty and all Obligations (as defined in
Annex A), (ii) H&E is willing to pledge to Agent, for the benefit of
Agent and Lenders, all of the Stock of H&E Finance and GNE Investments to
secure such guaranty and all Obligations, and (iii) GNE Investments is
willing to pledge to Agent, for the benefit of Agent and Lenders, all of the
Stock of Great Northern to secure the Obligations; and

 

(K)                               Capitalized terms used in this Agreement have
the meanings ascribed to them in Annex A and, for purposes of this Agreement
and the other Loan Documents, the rules of construction set forth in Annex
A shall govern.  All Annexes, Disclosures
Schedules, Exhibits and other attachments (collectively, “Appendices”)
hereto, or expressly identified to this Agreement, are incorporated herein by
reference, and taken together with this Agreement, shall constitute but a
single agreement.  These Recitals shall
be construed as part of the Agreement.

 

 

NOW, THEREFORE,
IN CONSIDERATION OF THE PREMISES AND THE MUTUAL COVENANTS HEREINAFTER
CONTAINED, AND FOR OTHER GOOD AND VALUABLE CONSIDERATION, THE PARTIES HERETO
AGREE AS FOLLOWS:

 

1.  AMOUNT AND TERMS OF CREDIT

 

1.1                                 Credit Facilities

 

(a)           Revolving Credit
Facility

 

(i)                                     Subject to the terms and conditions hereof
and to the last sentence of Section 1.1(c), each Revolving Lender agrees to
make available to Borrowers from time to time until the Commitment Termination
Date its Pro Rata Share of advances (each, a “Revolving
Credit Advance”).  The Pro
Rata Share of the Revolving Loan of any Revolving Lender shall not at any time
exceed its separate Revolving Loan Commitment. The obligations of each
Revolving Lender hereunder shall be several and not joint.  Until the Commitment Termination Date,
Borrowers may borrow, repay and reborrow under this Section 1.1(a); provided, that the amount of any Revolving
Credit Advance to be made to any Borrower at any time shall not exceed
Borrowing Availability of such Borrower at such time or, cause the Borrowing
Availability of all Borrowers to be exceeded. Moreover, the sum of the
Revolving Loan and Swing Line Loan outstanding to any Borrower shall not exceed
at any time that Borrower’s separate Borrowing Base, provided, that in the case of any Revolving Advances or
Swingline Advances that constitute H&E/Great Northern Advances included in
such sum, “that Borrower’s separate Borrowing Base” shall mean the Great Northern
Borrowing Base.  Each Revolving Credit
Advance shall be made on notice by Borrower Representative on behalf of the
applicable Borrower to the representative of Agent identified in Schedule 1.1
at the address specified therein.  Any
such notice must be given no later than (l) noon (New York time) on the
Business Day of the proposed Revolving Credit Advance, in the case of an Index
Rate Loan, or (2) noon (New York time) on the date which is three
(3) Business Days prior to the proposed Revolving Credit Advance, in the
case of a LIBOR Loan.  Each such notice
(a “Notice of Revolving Credit Advance”)
must be given in writing (by telecopy or overnight courier) substantially in
the form of Exhibit l.l(a)(i), and shall include the information required
in such Exhibit and such other administrative information as may be reasonably
required by Agent.  If any Borrower
desires to have the Revolving Credit Advances bear interest by reference to a
LIBOR Rate, Borrower Representative must comply with Section 1.5(e).

 

(ii)                                  Upon the request of any Revolving Lender,
each Borrower shall execute and deliver to such Revolving Lender a note to
evidence the Revolving Loan Commitment of that Revolving Lender. Each such note
shall be in the maximum

 

 

principal amount of the Revolving Loan Commitment of the applicable
Revolving Lender, dated the Closing Date and substantially in the form of Exhibit l.l(a)(ii) (each
as amended or replaced from time to time, a “Revolving
Note” and, collectively, the “Revolving Notes”).
Each Revolving Note shall represent the obligation of the applicable Borrower
to pay the amount of the applicable Revolving Lender’s Revolving Loan
Commitment or, if less, such Revolving Lender’s Pro Rata Share of the aggregate
unpaid principal amount of all Revolving Credit Advances to such Borrower
together with interest thereon as prescribed in Section 1.5.  The entire unpaid balance of the aggregate
Revolving Loan and all other noncontingent Obligations shall be immediately due
and payable in full in immediately available funds on the Commitment
Termination Date.

 

(b)           Swing Line Facility

 

(i)                                     Agent shall notify the Swing Line Lender upon
Agent’s receipt of any Notice of Revolving Credit Advance. Subject to the terms
and conditions hereof, the Swing Line Lender may, in its discretion, make
available from time to time until the Commitment Termination Date advances
(each, a “Swing Line Advance”) in accordance
with any such notice.  The provisions of
this Section l.l(b) shall not relieve Revolving Lenders of their
obligations to make Revolving
Credit Advances under Section 1.l(a); provided,
that if the Swing Line Lender makes a Swing Line Advance pursuant to
any such notice, such Swing Line Advance shall be in lieu of any Revolving
Credit Advance that otherwise may be made by Revolving Credit Lenders pursuant
to such notice. The aggregate amount of Swing Line Advances outstanding shall
not exceed at any time the lesser of (A) the Swing Line Commitment and (B) the
lesser of (x) the Maximum Amount and (y) the Aggregate Borrowing Base in each
case, less the outstanding balance of the Revolving Loan at such time (“Swing Line Availability”).  Moreover, the Swing Line Loan outstanding to
any Borrower shall not exceed at any time such Borrower’s separate Borrowing
Base less the Revolving Loan outstanding to such Borrower, provided, that in the case of any
H&E/Great Northern Advance, “such Borrower’s separate Borrowing Base” shall
mean the Great Northern Borrowing Base.  Until
the Commitment Termination Date, Borrowers may from time to time borrow, repay
and reborrow under this Section l.l(b).  Each Swing Line Advance shall be made on the
day requested pursuant to a Notice of Revolving Credit Advance delivered to
Agent by Borrower Representative on behalf of the applicable Borrower
requesting a Swing Line Advance in accordance with Section 1.1(a).  Any such notice must be given no later than
noon (New York time) on the Business Day of the proposed Swing Line
Advance.  Unless the Swing Line Lender
has received at least one Business Day’s prior written notice from Majority
Revolving Lenders instructing it not to make a Swing Line Advance, the Swing
Line Lender shall, notwithstanding the failure of any

 

 

condition precedent set forth in Section 2.2, except in the case
of a Prohibited Swing Line Advance, be entitled to fund that Swing Line
Advance, and to have each Revolving Lender make Revolving Credit Advances in
accordance with Section 1.1(b)(iii) or purchase participating
interests in accordance with Section 1.1(b)(iv).  Notwithstanding any other provision of this
Agreement or the other Loan Documents, the Swing Line Loan shall constitute an
Index Rate Loan.  Borrowers shall repay
the aggregate outstanding principal amount of the Swing Line Loan upon demand
therefor by Agent.

 

(ii)                                  Upon the request of the Swing Line Lender,
each Borrower shall execute and deliver to the Swing Line Lender a promissory
note to evidence the Swing Line Commitment. If a promissory note is requested,
each such note shall be in the principal amount of the Swing Line Commitment of
the Swing Line Lender, dated the Closing Date and substantially in the form of Exhibit 1.l(b)(ii) (each
as amended or replaced from time to time, a “Swing Line
Note” and, collectively, the “Swing Line Notes”).
 Each Swing Line Note shall represent the
obligation of the applicable Borrower to pay the amount of the Swing Line
Commitment or, if less, the aggregate unpaid principal amount of all Swing Line
Advances made to such Borrower together with interest thereon as prescribed in Section 1.5.
 The entire unpaid balance of the Swing
Line Loan and all other non contingent Obligations shall be immediately due and
payable in full in immediately available funds on the Commitment Termination
Date if not sooner paid in full.

 

(iii)                               The Swing Line Lender shall at any time and
from time to time in its sole and absolute discretion, but not less frequently
than on each Settlement Date on behalf of any Borrower (and each Borrower
hereby irrevocably authorizes the Swing Line Lender to so act on its behalf),
request each Revolving Lender (including the Swing Line Lender) to make a
Revolving Credit Advance to such Borrower (which shall be an Index Rate Loan)
in an amount equal to such Revolving Lender’s Pro Rata Share of the principal
amount of such Borrower’s Swing Line Loan (the “Refunded
Swing Line Loan”) outstanding on the date such notice is given.  Unless any of the events described in Sections
8.l(h) or (i) has occurred (in which event the procedures of Section l.l(b)(iv) shall
apply) and regardless of whether the conditions precedent set forth in this
Agreement to the making of a Revolving Credit Advance are then satisfied, each
Revolving Lender shall disburse directly to Agent, its Pro Rata Share of a
Revolving Credit Advance on behalf of the Swing Line Lender, prior to 3:00 p.m.
(New York time), in immediately available funds on the Business Day next
succeeding the date such notice is given.  The proceeds of such Revolving Credit Advances
shall be immediately paid to the Swing Line Lender and applied to repay the
Refunded Swing Line Loan of the applicable Borrower.

 

 

(iv)                              If, prior to refunding a Swing Line Loan with
a Revolving Credit Advance pursuant to Section l.l(b)(iii), one of the
events described in Sections 8.1(h) or (i) has occurred, then,
subject to the provisions of Section 1.1(b)(v) below, each Revolving
Lender shall, on the date such Revolving Credit Advance was to have been made
for the benefit of the applicable Borrower, purchase from the Swing Line Lender
an undivided participation interest in the Swing Line Loan to such Borrower in
an amount equal to its Pro Rata Share of such Swing Line Loan.  Upon request, each Revolving Lender shall
promptly transfer to the Swing Line Lender, in immediately available funds, the
amount of its participation interest.

 

(v)                                 Each Revolving Lender’s obligation to make
Revolving Credit Advances in accordance with Section 1.1(b)(iii) and
to purchase participation interests in accordance with Section l.l(b)(iv) shall
be absolute and unconditional and shall not be affected by any circumstance,
including (A) any setoff, counterclaim, recoupment, defense or other right
that such Revolving Lender may have against the Swing Line Lender, any Borrower
or any other Person for any reason whatsoever; (B) the occurrence or
continuance of any Default or Event of Default; (C) any inability of any
Borrower to satisfy the conditions precedent to borrowing set forth in this
Agreement at any time; or (D) any other circumstance, happening or event
whatsoever, whether or not similar to any of the foregoing.  If any Revolving Lender does not make
available to Agent or the Swing Line Lender, as applicable, the amount required
pursuant to Section 1.1(b)(iii) or 1.l(b)(iv), as the case may be,
the Swing Line Lender shall be entitled to recover such amount on demand from
such Revolving Lender, together with interest thereon for each day from the
date of non-payment until such amount is paid in full at the Federal Funds Rate
for the first two Business Days and at the Index Rate thereafter.

 

(c)           Reliance on Notices; Appointment of
Borrower Representative

 

Agent shall be entitled to rely upon, and shall be fully protected in
relying upon, any Notice of Revolving Credit Advance, Notice of Conversion/Continuation
or similar notice believed by Agent to be genuine. Agent may assume that each
Person executing and delivering any such notice in accordance herewith was duly
authorized, unless the responsible individual acting thereon for Agent has
actual knowledge to the contrary.  Each
Borrower, and to the extent applicable, each other Credit Party, hereby
designates H&E as its representative and agent on its behalf for the
purposes of issuing Notices of Revolving Credit Advances and Notices of Conversion/Continuation,
giving instructions with respect to the disbursement of the proceeds of the
Loans, selecting interest rate options, requesting Letters of Credit, giving
and receiving all other notices and consents hereunder or under any of the other
Loan Documents and taking all other actions (including in respect of compliance
with covenants) on behalf of any Credit Party or Credit Parties under the Loan
Documents.  Borrower Representative
hereby accepts such

 

 

appointment.  Agent and each
Lender may regard any notice or other communication pursuant to any Loan
Document from Borrower Representative as a notice or communication from all
Credit Parties, and may give any notice or communication required or permitted
to be given to any Credit Party or Credit Parties hereunder to Borrower
Representative on behalf of such Credit Party or Credit Parties.  Each Credit Party agrees that each notice,
election, representation and warranty, covenant, agreement and undertaking made
on its behalf by Borrower Representative shall be deemed for all purposes to
have been made by such Credit Party and shall be binding upon and enforceable
against such Credit Party to the same extent as if the same had been made
directly by such Credit Party.  Notwithstanding
anything to the contrary contained herein, unless the Requisite Lenders shall
otherwise agree in writing, the Borrower Representative shall not make any
request for an Advance on behalf of Great Northern and Great Northern shall not
be entitled to borrow from Lenders hereunder, provided,
that subject to the terms hereof, H&E may make requests for and
Lenders shall make H&E/Great Northern Advances.

 

1.2                                 Letters of Credit

 

Subject to and in accordance with the terms and conditions contained
herein and in Annex B, Borrower Representative, on behalf of any Borrower,
shall have the right to request, and Revolving Lenders agree to incur, or
purchase participations in, Letter of Credit Obligations in respect of such
Borrower.

 

1.3                                Prepayments

 

(a)                                  Voluntary Prepayments; Reductions in
Revolving Loan Commitments

 

Any Borrower may at any time voluntarily prepay all or part of the
Revolving Credit Advances made to such Borrower at any time or from time to
time without premium or penalty.  Borrowers
may at any time on at least ten (10) days’ prior written notice by
Borrower Representative to Agent permanently reduce (but not terminate) the
Revolving Loan Commitment; provided, that
(A) any such reductions shall be in a minimum amount of $5,000,000 and
integral multiples of $250,000 in excess of such amount, (B) the Revolving
Loan Commitment shall not be reduced to an amount less than the amount of the
Revolving Loan plus the Swingline Loan then outstanding, and (C) after
giving effect to such reductions, Borrowers shall comply with Section 1.3(b)(i).
 In addition, Borrowers may at any time
on at least 10 days’ prior written notice by Borrower Representative to Agent
terminate the Revolving Loan Commitment; provided,
that upon such termination, all Loans and other Obligations shall be
immediately due and payable in full and all Letter of Credit Obligations shall
be cash collateralized or otherwise satisfied in accordance with Annex B.  Any such payment resulting from termination of
the Revolving Loan Commitment must be accompanied by payment of all accrued and
unpaid interest on the Loans and other Obligations and any LIBOR funding
breakage costs in accordance with Section 1.13(b).  Upon any such reduction or termination of the

 

 

Revolving Loan Commitment, each Borrower’s right to request Revolving
Credit Advances, or request that Letter of Credit Obligations be incurred on
its behalf, or request Swing Line Advances, shall simultaneously be permanently
reduced or terminated, as the case may be; provided,
that a permanent reduction of the Revolving Loan Commitment shall
not require a corresponding pro rata reduction
in the L/C Sublimit.  Each notice of
partial prepayment shall designate the Borrower whose Revolving Credit Advances
are to be repaid and identify the particular Revolving Credit Advances to be
repaid.

 

(b)           Mandatory Prepayments

 

(i)                                     If at any time the aggregate outstanding
balances of the Revolving Loan exceeds the lesser of (A) the Maximum
Amount less the aggregate outstanding Swing Line Loan at such time and (B) the
Aggregate Borrowing Base less the aggregate outstanding Swing Line Loan
at such time, Borrowers shall immediately repay the aggregate outstanding
Revolving Credit Advances to the extent required to eliminate such excess.  If any such excess remains after repayment in
full of the aggregate outstanding Revolving Credit Advances, Borrowers shall
provide cash collateral for the Letter of Credit Obligations in the manner set
forth in Annex B to the extent required to eliminate such excess.  Furthermore, if, at any time, the outstanding
balance of the Revolving Loan to any Borrower exceeds such Borrower’s separate
Borrowing Base less the outstanding balance of the Swing Line Loan to
such Borrower, the applicable Borrower shall immediately repay its Revolving
Credit Advances in the amount of such excess (and, to the extent necessary,
provide cash collateral for its Letter of Credit Obligations as described
above), provided, that as to any
Revolving Advances consisting of H&E Great Northern Advances included in
such Revolving Loan balance, “such Borrower’s separate Borrowing Base” shall
mean the Great Northern Borrowing Base.

 

(ii)                                  Immediately upon receipt by any Credit Party
of proceeds of any asset disposition (excluding proceeds of dispositions of
Equipment Inventory and P&E permitted by Section 6.8 having an
aggregate Net Book Value in any one Fiscal Year, not exceeding $500,000) or any
sale of Stock of any Subsidiary of such Credit Party, Borrowers shall prepay
the Loans in an amount equal to all such proceeds, net of (A) commissions
and other reasonable and customary transaction costs, fees and expenses
properly attributable to such transaction and payable by any Credit Party in
connection therewith (in each case, paid to non-Affiliates), (B) amounts
payable to holders of senior Liens (to the extent such Liens constitute
Permitted Encumbrances hereunder), if any, on the assets so disposed and (C) transfer
taxes plus an appropriate reserve for income taxes in accordance with GAAP in
connection therewith.  Any such prepayment
shall, subject to Section 1.3(b)(iv), be applied in accordance with Section 1.3(c).

 

(iii)                               If any Credit Party issues Stock or any
Indebtedness (other than Indebtedness permitted by Section 6.3) in excess
of $1,000,000 in the aggregate of such Stock

 

 

and such Indebtedness, no later than the Business Day following the
date of receipt of the cash proceeds thereof, the issuing Credit Party shall
prepay the Loans in an amount equal to all such proceeds, net of underwriting
discounts and commissions and other reasonable costs paid to non-Affiliates in
connection therewith; provided, that
no such prepayment shall be required, so long as no Event of Default has
occurred and is continuing, from the proceeds of any issuance of Stock by a
Credit Party (i) to any director, officer or other employee of such Credit
Party, the total proceeds of which do not exceed $5,000,000 in the aggregate, (ii) in
connection with the Related Transactions, (iii) as consideration for any
Person (other than any Affiliate of a Credit Party) providing permitted
Indebtedness under Section 6.3, (iv) to any other Credit Party or (v) as
consideration to any Person (other than an Affiliate) selling assets in any
Permitted Acquisition. Any such prepayment shall, subject to Section 1.3(b)(iv),
be applied in accordance with Section 1.3(c).

 

(iv)                              In the event that Section 1.3(b)(i), (ii) or
(iii) shall require any prepayment to be made on a day other than an
Interest Payment Date, then upon receipt of such prepayment and to the extent
requested by any Borrower, Agent shall hold such amount as cash collateral
(provided that the Borrower delivering the same shall have executed and
delivered such documents as Agent shall have requested in connection with such
cash collateral) and, so long as no Default or Event of Default shall have
occurred and be continuing, shall not apply such cash collateral to the
prepayment under the applicable paragraph of this Section 1.3 until the
next succeeding Interest Payment Date. Such cash collateral shall be invested in
Cash Equivalents as directed by such Borrower in accordance with such
documents.  Interest earned on such cash
collateral shall accrue for the account of the Borrower providing the same,
shall constitute additional cash collateral and (assuming no Default or Event
of Default shall be continuing) shall be, to the extent remaining, applied to
such prepayment on such next succeeding Interest Payment Date.

 

(c)                                 Application
of Certain Mandatory Prepayments

 

Any prepayments made by any Borrower or Credit Party pursuant to Section 1.3(b)(ii) or
(iii) shall be applied as follows: first,
to Fees and reimbursable expenses of Agent then due and payable pursuant to any
of the Loan Documents; second, to
Fees and any other fees and reimbursable expenses of Lenders then due and
payable pursuant to any of the Loan Documents; third,
to interest men due and payable on the Swing Line Loan; fourth, to the principal balance of the
Swing Line Loan until the same has been repaid in full; fifth, to interest then due and payable on
the Revolving Credit Advances; sixth, to
the outstanding principal balance of the Revolving Credit Advances until the
same has been paid in full; seventh, to
any Letter of Credit Obligations, to provide cash collateral therefor in the
manner set forth in Annex B and last to
any other Obligations, So long as

 

 

no
Event of Default is outstanding, the Borrowers may direct that any such
prepayments be applied to Index Rate Loans to the extent outstanding, rather
than LIBOR Loans.  Neither the Revolving
Loan Commitment nor the Swing Line Commitment shall be permanently reduced by
the amount of any such prepayments; provided,
that any prepayment made by any Borrower pursuant to Section 1.3(b)(iii) in
connection with the issuance of Indebtedness shall also permanently reduce the
Revolving Loan Commitment by the amount of such prepayment.

 

(d)                                Application of Prepayments from Insurance and Condemnation Proceeds

 

Prepayments from insurance or condemnation proceeds in accordance with Section 5.4
shall be applied first to the Swing Line Loans and second to the Revolving
Credit Advances of the applicable Borrower.  Neither the Revolving Loan Commitment nor the
Swing Line Loan Commitment shall be permanently reduced by the amount of any
such prepayments.  So long as no Event of
Default is outstanding, the Borrower Representative may direct that any such
prepayments be applied to Index Rate Loans to the extent outstanding, rather
than LIBOR Loans.  If the insurance or
condemnation proceeds received as to a particular Borrower exceed the Loans
outstanding to such Borrower, such excess proceeds shall be applied to the
Loans outstanding to other Borrowers.

 

(e)                                 No Implied Consent

 

Nothing in this Section 1.3 shall be construed to constitute Agent’s
or any Lender’s consent to any transaction referred to in Sections
1.3(b)(ii)and 1.3(b)(iii) which is not permitted by other provisions of
this Agreement or the other Loan Documents.

 

1.4                                Use of Proceeds

 

Borrowers shall utilize the proceeds of the Revolving Loan and the
Swing Line Loan solely for the Refinancing (and to pay any related transaction
expenses), and for the financing of Borrowers’ ordinary working capital and
general corporate needs.  Disclosure Schedule (1.4)
contains a description of Borrowers’ sources and uses of funds as of the
Closing Date, including Revolving Credit Advances and Letter of Credit
Obligations to be made or incurred on that date, and a funds flow memorandum
detailing how funds from each source are to be transferred to particular uses.

 

1.5                                Interest and Applicable Margins

 

(a)                                 Borrowers shall pay interest to Agent, for the ratable benefit of Lenders in
accordance with the various Revolving Credit Advances and Swing Line Loans
being made by each Lender, and in respect of all unreimbursed Letters of Credit
Obligations, in arrears on each applicable Interest Payment Date, at the
following rates:  (i) with respect
to the Revolving Credit Advances and unreimbursed Letter of Credit Obligations
and all other Obligations (other than LIBOR Loans and Swing Line Loans), the
Index Rate plus the Applicable Revolver Index Margin per annum or, at
the election of Borrower

 

 

Representative, the applicable LIBOR Rate plus the Applicable
Revolver LIBOR Margin per annum, based on the aggregate Revolving Credit
Advances outstanding from time to time; and (ii) with respect to the Swing
Line Loan, the Index Rate plus the Applicable Revolver Index Margin per
annum, based on the aggregate amount of the Swing Line Loan outstanding from
time to time.

 

The Applicable Margins, on a per annum basis, are as follows:

 

	
  Applicable Margin

  	
   

  	
  Amount

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Applicable Revolver Index Margin

  	
   

  	
  1.50

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  Applicable Revolver LIBOR Margin

  	
   

  	
  3.00

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  Applicable L/C Margin

  	
   

  	
  3.00

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  Applicable Unused Line Fee Margin

  	
   

  	
  0.50

  	
  %

  

 

(b)                                If any payment on any Loan becomes due and
payable on a day other than a Business Day, the maturity thereof will be
extended to the next succeeding Business Day (except as set forth in the
definition of LIBOR Period) and, with respect to payments of principal, interest
thereon shall be payable at the then applicable rate during such extension.

 

(c)                                 All computations of Fees calculated on a per
annum basis and interest shall be made by Agent on the basis of a three hundred
sixty (360) day year, in each case for the actual number of days occurring in
the period for which such interest and Fees are payable.  The Index Rate is a floating rate determined
for each day.  Each determination by
Agent of an interest rate and Fees hereunder shall be final, binding and
conclusive on Borrowers, absent manifest error.

 

(d)                                So long as an Event of Default has occurred
and is continuing, and at the election of Agent (or upon the written request of
Requisite Lenders) confirmed by written notice from Agent to Borrower
Representative, the interest rates applicable to the Loans and the Letter of
Credit Fees shall be increased by two percentage points (2%) per annum above
the rates of interest or the rate of such Fees otherwise applicable hereunder (“Default Rate”),
and all outstanding Obligations shall bear interest at the Default Rate
applicable to such Obligations.  Interest
and Letter of Credit Fees at the Default Rate shall accrue from the initial
date of such Event of Default until that Event of Default is cured or waived
and shall be payable upon demand.

 

(e)                                 So long as no Event of Default has occurred
and is continuing, Borrower Representative - shall have the option to (i) request
that any Revolving Credit Advance be made as a LIBOR Loan, (ii) convert at
any time all or any part of outstanding Loans (other than the Swing Line Loan)
from Index Rate Loans to LIBOR Loans, (iii) convert any LIBOR Loan to an
Index Rate Loan, subject to payment of LIBOR breakage costs in accordance with Section 1.13(b) if
such conversion is made prior to the expiration of the LIBOR

 

 

Period applicable thereto, or (iv) continue all or any portion of
any Loan (other than the Swing Line Loan) as a LIBOR Loan upon the expiration
of the applicable LIBOR Period and the succeeding LIBOR Period of that
continued Loan shall commence on the first day after the last day of the LIBOR
Period of the Loan to be continued.  Any
Loan or group of Loans having the same proposed LIBOR Period to be made or
continued as, or converted into, a LIBOR Loan must be in a minimum amount of
$1,000,000 and integral multiples of $100,000 in excess of such amount. Any
such election must be made by noon (New York time) on the third (3rd) Business
Day prior to (1) the date of any proposed Advance which is to bear
interest at the LIBOR Rate, (2) the end of each LIBOR Period with respect
to any LIBOR Loans to be continued as such, or (3) the date on which the
applicable Borrower wishes to convert any Index Rate Loan to a LIBOR Loan for a
LIBOR Period designated by Borrower Representative in such election.  If no election is received with respect to a
LIBOR Loan by noon (New York time) on the third (3rd) Business Day prior to the
end of the LIBOR Period with respect thereto (or if an Event of Default has
occurred and is continuing), that LIBOR Loan shall be converted to an Index
Rate Loan at the end of its LIBOR Period.  Borrower Representative must make such
election by notice to Agent in writing, by telecopy or overnight courier.  In the case of any conversion or continuation,
such election must be made pursuant to a written notice (a “Notice of
Conversion/Continuation”) in the form of Exhibit 1.5(e).  No Loan may be made as or converted into a
LIBOR Loan until the earlier of (i) forty-five (45) days after the Closing
Date or (ii) completion of primary syndication as determined by Agent.

 

(f)                                   Notwithstanding anything to the contrary set
forth in this Section 1.5, if a court of competent jurisdiction determines
in a final order that the rate of interest payable hereunder exceeds the
highest rate of interest permissible under law (the “Maximum
Lawful Rate”), then so long as the Maximum Lawful Rate would be so
exceeded, the rate of interest payable hereunder shall be equal to the Maximum
Lawful Rate; provided, that if at
any time thereafter the rate of interest payable hereunder is less than the
Maximum Lawful Rate, Borrowers shall continue to pay interest hereunder at the
Maximum Lawful Rate until such time as the total interest received by Agent, on
behalf of Lenders, is equal to the total interest that would have been received
had the interest rate payable hereunder been (but for the operation of this
paragraph) the interest rate payable since the Closing Date as otherwise
provided in this Agreement.  Thereafter,
interest hereunder shall be paid at the rate(s) of interest and in the manner
provided in Sections 1.5(a) through (e) above, unless and until the
rate of interest again exceeds the Maximum Lawful Rate, and at that time this paragraph shall again
apply.  In no event shall the total
interest received by any Lender pursuant to the terms hereof exceed the amount
that such Lender could lawfully have received had the interest due hereunder
been calculated for the full term hereof at the Maximum Lawful Rate.  If the Maximum Lawful Rate is calculated pursuant
to this paragraph, such interest shall be calculated at a daily rate equal to
the Maximum Lawful Rate divided by the number of days in the year in which such
calculation is made.  If, notwithstanding
the provisions of this

 

 

Section 1.5(f), a court of competent
jurisdiction shall finally determine that a Lender has received interest
hereunder in excess of the Maximum Lawful Rate, Agent shall, to the extent
permitted by applicable law, promptly apply such excess in the order specified
in Section 1.11 and thereafter shall refund any excess to Borrowers or as
a court of competent jurisdiction may otherwise order.

 

1.6                                Eligible Accounts

 

All of the Accounts owned by any Borrower and reflected in the most
recent Borrowing Base Certificate delivered by such Borrower to Agent shall be “Eligible Accounts” for purposes of this Agreement, except
any Account to which any of the exclusionary criteria set forth below applies.  In addition, Agent reserves the right, at any
time and from time to time after the Closing Date, to adjust any of the
criteria set forth below, to establish new criteria and to adjust advance rates
with respect to Eligible Accounts, in its reasonable credit judgment exercised
in good faith; provided, that (i) any
increase of any advance rate above its Original Advance Rate is subject to the
approval of all Lenders and (ii) any adjustment by Agent to any criterion
set forth below that results in such criterion being less restrictive than as
in effect on the Closing Date shall be subject to approval of Requisite
Lenders.  Eligible Accounts shall not
include any Account of any Borrower:

 

(a)                                 which does not arise from the sale of goods
or the performance of services by such Borrower in the ordinary course of its
business;

 

(b)                                upon which (i) such Borrower’s right to
receive payment is contingent upon the fulfillment of any condition by such
Borrower or (ii) such Borrower is not able to bring suit or otherwise
enforce its remedies against the Account Debtor through judicial process;

 

(c)                                 to the extent that any defense, counterclaim,
setoff or dispute is asserted as to such Account;

 

(d)                                if the Account represents a progress billing
consisting of an invoice for goods sold or used or services rendered pursuant
to a contract under which the Account Debtor’s obligation to pay that invoice
is subject to such Borrower’s completion of further performance under such
contract;

 

(e)                                 that is not a true and correct statement of
bona fide indebtedness incurred in the amount of the Account for merchandise
sold to or services rendered and accepted by the applicable Account Debtor;

 

(f)                                   with respect to which an invoice, that is not
unacceptable to Agent (in its reasonable judgment) in form and substance, has
not been sent to the applicable Account Debtor;

 

 

(g)                                (i) that is not owned by such Borrower
or (ii) to the extent it is subject to any right, claim, security interest
or other interest of any other Person, other than Liens in favor of Agent, on
behalf of itself and Lenders, and Trustee, on behalf of the holders of Senior
Notes;

 

(h)                                that arises from a sale to any director,
officer, other employee or Affiliate of any Credit Party, or to any entity that
has any common officer or director with any Credit Party; provided, however, that a sale to any
Person that is an Affiliate or such an entity shall not be excluded under this
paragraph (h) if such Person is an Affiliate or such an entity solely
because it is controlled by BRS or a fund managed by BRS;

 

(i)                                    that is the obligation of an Account Debtor
that is the United States or Canadian government or a political subdivision
thereof, or any state, county, province or municipality or department, agency
or instrumentality thereof unless Agent, in its sole discretion, has agreed to
the contrary in writing and such Borrower, if necessary or desirable, has
complied with the Federal Assignment of Claims Act of 1940, any Canadian
equivalent thereof, or any applicable state, county or municipal law
restricting assignment thereof, with respect to such obligation; provided, so long as no Default or Event
of Default shall have occurred and be continuing, Accounts described in this Section 1.6(i) and
identified to the Agent pursuant to Section 5.10 shall be deemed Eligible
Accounts to the extent such Accounts in the aggregate outstanding at any time
do not exceed $1,500,000 and otherwise meet the eligibility criteria set forth
in this Section 1.6;

 

(j)                                    that is the obligation of an Account Debtor
located in a foreign country other than Canada (excluding the provinces of
Newfoundland, the Northwest Territories and the Territory of Nunavit), unless
payment thereof is assured by a letter of credit assigned and delivered to
Agent, reasonably satisfactory to Agent as to form, amount
and issuer;

 

(k)                                 to the extent such Borrower or any Subsidiary
thereof is liable for goods sold or services rendered by the applicable Account
Debtor to such Borrower or any Subsidiary thereof but only to the extent of the
potential offset;

 

(l)                                    that arises with respect to goods that are
delivered on a bill-and-hold, cash-on-delivery basis or placed on consignment,
guaranteed sale or other terms by reason of which the payment by the Account
Debtor is or may be conditional;

 

(m)                              that is in default; provided, that, without limiting the
generality of the foregoing, an Account shall be deemed in default upon the
occurrence of any of the following:

 

(i)                                    the Account is not paid within the earlier
of: sixty (60) days following its due date or ninety (90) days following its
original invoice date;

 

(ii)                                 the Account Debtor obligated upon such
Account suspends business, makes a general assignment for the benefit of
creditors or fails to pay its debts generally as they come due; or

 

 

(iii)                              a petition is filed by or against any Account
Debtor obligated upon such Account under any bankruptcy law or any other
federal, state or foreign (including any provincial) receivership, insolvency
relief or other law or laws for the relief of debtors;

 

(n)                                that is the obligation of an Account
Debtor if fifty percent (50%) or more of the Dollar amount of all Accounts
owing by that Account Debtor are ineligible under the other criteria set forth
in paragraph (m) of this Section 1.6;

 

(o)                                as to which Agent’s Lien thereon, on behalf
of itself and Lenders, is not a first priority perfected Lien;

 

(p)                                as to which any of the representations or
warranties in the Loan Documents are untrue;

 

(q)                                to the extent such Account is evidenced by a
judgment;

 

(r)                                   to the extent such Account exceeds any credit
limit established by Agent, in its reasonable credit judgment;

 

(s)                                 that is payable in any currency other than
Dollars; or

 

(t)                                   that is otherwise unacceptable to Agent in
its reasonable credit judgment.

 

1.6A                      Eligible Rolling Stock

 

All of the P&E owned by any Borrower and reflected in the most
recent Borrowing Base Certificate delivered by such Borrower to Agent shall be “Eligible Rolling Stock”
for purposes of this Agreement, except any P&E to which any of the
exclusionary criteria set forth below applies.  In addition, Agent reserves the right, at any
time and from time to time after the Closing Date, to adjust any of the
criteria set forth below, to establish new criteria and to adjust advance rates
with respect to Eligible Rolling Stock in its reasonable credit judgment; provided, that (i) any increase of
any advance rate above its Original Advance Rate is subject to the approval of
all Lenders and (ii) any adjustment by Agent to any criterion set forth
below that results in such criterion being less restrictive than as in effect
on the Closing Date shall be subject to approval of Requisite Lenders.  Eligible Rolling Stock shall not include any
P&E of any Borrower:

 

(a)                                 that is not owned by such Borrower free and
clear of all Liens and rights of any other person, except the Liens in favor of
Agent, on behalf of itself and Lenders, and Collateral Agent on behalf of the
holders of Senior Notes, and the rights of a lessee pursuant to any permitted
lease of such P&E or Permitted Encumbrances;

 

(b)                                if such P&E (i) is not stored on
premises owned, leased or rented by such Borrower and set forth in Disclosure Schedule (3.2),
or (ii) following thirty (30) days after the Closing Date, is stored at a
leased location in respect of which Agent has requested a landlord waiver,
unless a reasonably satisfactory landlord waiver has been delivered to Agent, provided that Agent may, following thirty
(30) days after the Closing Date, treat any such

 

 

P&E at any such location as Eligible Rolling Stock and, in lieu of
imposing the exclusionary criterion in this paragraph (b) to such P&E,
impose a Reserve (without duplicating any Reserve established for other
eligible collateral at such location as a consequence of the failure to obtain
such landlord’s waiver) in an amount not less than six month’s rent for all
such P&E stored at such location in respect of which such a landlord waiver
has not been delivered, or (iii) is stored with a bailee or warehouseman
unless a reasonably satisfactory, acknowledged bailee letter has been received
by Agent and Reserves reasonably satisfactory to Agent have been established
with respect thereto, (iv) is stored at an owned location subject to a
mortgage in favor of a lender other than Agent unless a reasonably satisfactory
mortgagee waiver requested by Agent has been delivered to Agent or (v) is
anything other than automotive equipment, a trailer, a truck, a forklift, a
motor vehicle or other rolling stock;

 

(c)                                 that is covered by a certificate of title
unless the interest of Agent in the P&E has been noted on such certificate
of title in accordance with
applicable law;

 

(d)                                that is excess, obsolete or damaged;

 

(e)                                 that is held for sale or lease in the
ordinary course of such Borrower’s business;

 

(f)                                   that is not subject to a first priority Lien
in favor of Agent on behalf of itself and Lenders;

 

(g)                                as to which any of the representations or
warranties pertaining to P&E set forth in the Loan Documents are untrue;

 

(h)                                that is not covered by casualty insurance as
to which Agent is listed as loss payee in accordance with Section 5.4(c); or

 

(i)                                    that is otherwise unacceptable to Agent in
its reasonable credit judgment.

 

1.6B                         Eligible
Rentals

 

All of the Rentals of each Borrower and reflected in the most recent
Borrowing Base Certificate delivered by such Borrower to Agent shall be “Eligible Rentals” for purposes of this Agreement, except
any Rental to which any of the exclusionary criteria set forth below applies.  In addition, Agent reserves the right, at any
time and from time to time after the Closing Date to adjust any such criteria
and to establish new criteria with respect to Eligible Rentals in its
reasonable credit judgment, provided, that
(i) any increase of any advance rate above its Original Advance Rate is
subject to the approval of all Lenders and (ii) any adjustment by Agent of
any criteria set forth below that results in such criteria being less
restrictive than as in effect on the Closing Date shall be subject to the
approval of Requisite Lenders.  Eligible
Rentals shall not include any Rental of any Borrower;

 

(a)                                 not subject to a written lease agreement in
the form attached as Exhibit 1.6B(a) or otherwise in form and
substance acceptable to Agent;

 

 

(b)                                not
subject to a first priority security interest of Agent on behalf of Lenders,
perfected by possession of all Chattel Paper related to such Rental by
possession or by the stamping of notice of Agent’s security interest thereon;

 

(c)                                 not
due within ninety (90) days of the applicable date of determination;

 

(d)                                upon
which such Borrower is not able to bring suit or otherwise enforce its remedies
against the relevant lessee through judicial process;

 

(e)                                 that (i) is not owned by such Borrower, (ii) is
subject to any right, claim, security interest or other interest of any other
Person, other than Liens in favor of Agent, on behalf of itself and Lenders or (iii) is
subject to any counterclaim, dispute, offset or defense;

 

(f)                                   that is the obligation of a lessee that is
the United States or Canadian government or a political subdivision thereof, or
any state, county, province or municipality or department, agency or
instrumentality thereof unless Agent, in its sole discretion, has agreed to the
contrary in writing and such Borrower, if necessary or desirable, has complied
with the Federal Assignment of Claims Act of 1940, and any amendments thereto,
its Canadian equivalent or any applicable state, county or municipal law
restricting assignment thereof, with respect to such obligation;

 

(g)                                that is the obligation of a lessee located in
a foreign country other than Canada (excluding the province of Newfoundland,
the Northwest Territories and the Territory of Nunavit), unless payment thereof
is assured by a letter of credit, reasonably satisfactory to Agent as to form,
amount and issuer;

 

(h)                                that is in default, or is due under a lease
which is in default;

 

(i)                                    if any lessee obligated upon such Rental
suspends business, makes a general assignment for the benefit of creditors or
fails to pay its debts generally as they come due;

 

(j)                                    if any petition is filed by or against any
lessee obligated upon such Rental under any bankruptcy law or any other
federal, state or foreign (including any provincial) receivership, insolvency
relief or other law or laws for the relief of debtors;

 

(k)                                 that is the obligation of a lessee if fifty
percent (50%) or more of the Dollar amount of all Rentals owing by that lessee
are ineligible under the other criteria set forth in this Section 1.6B;

 

(l)                                    as to which any of the representations or
warranties in the Loan Documents are untrue;

 

(m)                              to the extent such Rental exceeds any credit
limit established by Agent, in its reasonable credit judgment;

 

(n)                                that is payable in any currency other than
Dollars; or

 

(o)                                that is otherwise unacceptable to Agent in its reasonable credit judgment.

 

 

1.7                                Eligible Parts and Tools Inventory

 

All of the Parts and Tools Inventory owned by any Borrower and
reflected in the most recent Borrowing Base Certificate delivered by such
Borrower to Agent shall be “Eligible Parts and Tools Inventory”
for purposes of this Agreement, except any Parts and Tools Inventory to which
any of the exclusionary criteria set forth below applies. In addition, Agent
reserves the right, at any time and from time to time after the Closing Date,
to adjust any of the criteria set forth below, to establish new criteria and to
adjust advance rates with respect to Eligible Parts and Tools Inventory in its
reasonable credit judgment; provided, that
(i) any increase of any advance rate above its Original Advance Rate is
subject to the approval of all Lenders and (ii) any adjustment by Agent to
any criterion set forth below that results in such criterion being less
restrictive than as in effect on the Closing Date shall be subject to approval
of Requisite Lenders.  Eligible Parts and
Tools Inventory shall not include any Parts and Tools Inventory of any
Borrower;

 

(a)                                 that (i) is not owned by such Borrower
free and clear of all Liens and rights of any other Person (including the
rights of a purchaser that has made progress payments and the rights of a
surety that has issued a bond to assure such Borrower’s performance with
respect to that Parts and Tools Inventory), except the Liens in favor of Agent,
on behalf of itself and Lenders, and Collateral Agent, on behalf of the holders
of Senior Notes, and Permitted Encumbrances in favor of landlords and bailees
to the extent permitted in Section 5.9 hereof (subject to Reserves
established by Agent in accordance with Section 5.9 hereof);

 

(b)                              (i) that is not located on premises
owned, leased or rented by such Borrower and set forth in Disclosure Schedule (3.2),
or (ii) following thirty (30) days after the Closing Date, is stored at a
leased location in respect of which Agent has requested a landlord waiver,
unless a reasonably satisfactory landlord waiver has been delivered to Agent, provided that Agent may, following thirty
(30) days after the Closing Date, treat any such Parts and Tools Inventory at
any such location as Eligible Parts and Tools Inventory and, in lieu of
imposing the exclusionary criterion in this paragraph (b) to such Parts and
Tools Inventory, impose a Reserve (without duplicating any Reserve established
for other eligible collateral at such location as a consequence of the failure
to obtain such landlord’s waiver) in an amount not less than six month’s rent
for all Parts and Tools Inventory stored at such location in respect of which
such a landlord waiver has not been delivered, or (iii) is stored with a
bailee or warehouseman unless a reasonably satisfactory, acknowledged bailee
letter has been received by Agent and Reserves reasonably satisfactory to Agent
have been established with respect thereto, or (iv) is located at an owned
location subject to a mortgage in favor of a lender other than Agent unless a
reasonably satisfactory mortgagee waiver requested by Agent has been delivered
to Agent, or (v) is located at any site if the aggregate book value of
Parts and Tools Inventory at any such location is less than $25,000;

 

 

(c)                                 that is placed on consignment or is in
transit;

 

(d)                                that is covered by a negotiable document of title,
unless such document has been delivered to Agent with all necessary
endorsements, free and clear of all Liens except those in favor of Agent and
Lenders;

 

(e)                                 that is excess, obsolete, unsalable or
damaged;

 

(f)                                   that consists of display items or packing or
shipping materials, manufacturing supplies or work-in-process Inventory;

 

(g)                                that is not held for sale in the ordinary course of such Borrower’s
business;

 

(h)                                that is not subject to a first priority Lien
in favor of Agent on behalf of itself and Lenders;

 

(i)                                    as to which any of the representations or
warranties pertaining to Parts and Tools Inventory set forth in the Loan
Documents are untrue;

 

(j)                                    that consists of Hazardous Materials or goods
that can be transported or sold only with licenses that are not readily
available;

 

(k)                                 that is not covered by casualty insurance as
to which Agent is listed as loss payee in accordance with Section 5.4(c);
or

 

(1)                                 that is otherwise unacceptable to Agent in
its reasonable credit judgment.

 

1.7A                       Eligible Equipment Inventory

 

All of the Equipment Inventory owned by any Borrower and reflected in
the most recent Borrowing Base Certificate delivered by such Borrower to Agent
shall be “Eligible Equipment Inventory” for
purposes of this Agreement, except any Equipment Inventory to which any of the
exclusionary criteria set forth below applies.  In addition, Agent reserves the right, at any
time and from time to time after the Closing Date, to adjust any of the
criteria set forth below, to establish new criteria and to adjust advance rates
with respect to Eligible Equipment Inventory in its reasonable credit judgment;
provided, that (i) any increase of any advance rate
above its Original Advance Rate is subject to the approval of all Lenders and (ii) any
adjustment by Agent to any criterion set forth below that results in such
criterion being less restrictive than as in effect on the Closing Date shall be
subject to approval of Requisite Lenders.  Eligible Equipment Inventory shall not include
any Equipment Inventory of any Borrower:

 

(a)                                 that is not owned by such Borrower free and
clear of all Liens and rights of any other person (including the rights of a
purchaser that has made progress payments and the rights of a surety that has
issued a bond to assure such Borrower’s performance with respect to that
Equipment Inventory), except the Liens in favor of Agent, on behalf of itself
and Lenders, and Collateral Agent, on behalf of the holders of Senior Notes,
and the

 

 

rights of a lessee pursuant to any permitted lease of such Equipment
Inventory or Permitted Encumbrances;

 

(b)                                that (i) is not located on premises
owned, leased or rented by such Borrower and set forth in Disclosure Schedule (3.2),
or (ii) following thirty (30) days after the Closing Date, is stored at a
leased location in respect of which Agent has requested a landlord waiver,
unless a reasonably satisfactory landlord waiver has been delivered to Agent, provided that Agent may, following thirty
(30) days after the Closing Date, treat any such Equipment Inventory stored at
any such location as Eligible Equipment Inventory and, in lieu of imposing the
exclusionary criterion in this paragraph (b) to such Equipment Inventory,
impose a Reserve (without duplicating any Reserve established for other
eligible collateral at such location as a consequence of the failure to obtain
such landlord’s waiver) in an amount not less than six month’s rent for all
Equipment Inventory stored at such location in respect of which such a landlord
waiver has not been delivered, or (iii) is stored with a bailee or
warehouseman unless a reasonably satisfactory, acknowledged bailee letter has
been received by Agent and Reserves reasonably satisfactory to Agent have been
established with respect thereto, or (iv) is located at an owned location
subject to a mortgage in favor of a lender other than Agent unless a reasonably
satisfactory mortgagee waiver requested by Agent has been delivered to Agent,
or (v) is leased to a lessee other than pursuant to a lease entered into
in the ordinary course of business of such Equipment Inventory and is located
at a site that is in the United States or Canada (excluding the provinces of
Newfoundland, the Northwest Territories and the Territory of Nunavit);

 

(c)                                 that is placed on consignment;

 

(d)                                that is covered by a negotiable document of
title or a certificate of title unless such negotiable document has been
delivered to Agent with all necessary endorsements free and clear of all Liens
except those in favor of Agent
and Lenders, or where it is required to perfect the security interest of Agent
in the Equipment Inventory such certificate of title has been noted in such
certificate of tide in accordance with applicable law;

 

(e)                                 that is obsolete, unsalable or damaged beyond
repair;

 

(f)                                   that is not held for sale or lease in the
ordinary course of such Borrower’s business;

 

(g)                                that is not subject to a first priority Lien
in favor of Agent on behalf of itself and Lenders;

 

(h)                                as to which any of the representations or
warranties pertaining to Equipment Inventory set forth in the Loan Documents
are untrue;

 

(i)                                    that is not covered by casualty insurance as
to which Agent is listed as loss payee in accordance with Section 5.4(c);
or

 

(j)                                    that is otherwise unacceptable to Agent in its reasonable credit judgment.

 

 

1.8                                Cash
Management Systems

 

On or prior to the Closing Date, each Borrower will establish and will
maintain until the Termination Date, the cash management systems described in
Annex C (the “Cash Management Systems”).

 

1.9                                Fees

 

(a)                                 Borrowers shall pay to GE Capital,
individually, the Fees specified in that certain fee letter of even date
herewith among Borrowers and GE Capital (the “GE Capital
Fee Letter”), at the times specified for payment therein which shall
include the annual Administrative Agent’s fee, which will be due and payable on
the Closing Date and on each anniversary thereof.

 

(b)                                As additional compensation for the Revolving
Lenders, Borrowers agree to pay to Agent, for the ratable benefit of such
Lenders, in arrears, on the first Business Day of each month prior to the
Commitment Termination Date and on the Commitment Termination Date, a Fee for
Borrowers’ non-use of available funds in an amount equal to the Applicable
Unused Line Fee Margin per annum (calculated on the basis of a 360 day year for
actual days elapsed) multiplied by the difference between (x) the Maximum
Amount (as it may be reduced from time to time) and (y) the average for the
period of the daily closing balances of the aggregate Revolving Loan and the
Swing Line Loan outstanding during the period for which such Fee is due.

 

(c)                                 As additional compensation for the Agent,
Borrowers agrees to pay to the L/C Issuer with respect to any Letter of Credit,
at the time such Letter of Credit is issued or extended, a fronting fee in an amount
equal to one quarter of one percent (0.25%) of the face amount of such Letter
of Credit.

 

(d)                                Borrowers shall pay to Agent, for the ratable
benefit of Revolving Lenders, the Letter of Credit Fee as provided in Annex B.

 

(e)                                 In addition, and in addition to the costs of
Equipment Inventory Appraisals, P&E Appraisals and Inspections, Borrowers
agree to pay to Agent, which are due and payable as incurred, all out of pocket
costs (including reasonable fees and expenses) paid by Agent to third party auditors,
or a fee of $700 per audit day per in-house auditor, plus out of pocket
expenses; provided, that
Borrowers only agree to pay such costs and expenses in relation to (unless an
Event of Default has occurred and is continuing) not more than four (4) audits
in the first twelve months following the Closing Date and not more than three (3) audits
in any subsequent year (each such audit to be conducted, while no Event of
Default is continuing, during an Inspection).

 

 

 

1.10                           Receipt
of Payments

 

Borrowers shall make each payment under this Agreement not later than
2:00 p.m. (New York time) on the day when due in immediately available
funds in Dollars to the Collection Account.  For purposes of computing interest and Fees
and determining Borrowing Availability as of any date, all payments shall be
deemed received on the Business Day on which immediately available funds
therefor are received in the Collection Account prior to 2:00 p.m. New
York time.  Payments received after 2:00 p.m.
New York time on any Business Day or on a day that is not a Business Day shall
be deemed to have been received on the following Business Day.

 

1.11                           Application
and Allocation of Payments

 

(a)                                  So long as no Event
of Default has occurred and is continuing, (i) payments consisting of proceeds
of Accounts received in the ordinary course of business shall be applied,
first, to the Swing Line Loan and, second, to the Revolving Loan; (ii) voluntary
prepayments shall be applied as determined by Borrower Representative, subject
to the provisions of Section 1.3(a); and (iii) mandatory prepayments
shall be applied as set forth in Section 1.3.  As to any other payment, and as to all
payments made when an Event of Default has occurred and is continuing or
following the Commitment Termination Date, each Borrower hereby irrevocably
waives the right to direct the application of any and all payments received
from or on behalf of such Borrower, and each Borrower hereby irrevocably agrees
that Agent shall have the continuing exclusive right to apply any and all such
payments against the Obligations as Agent may deem advisable notwithstanding
any previous entry by Agent in the Loan Account or any other books and records.
 In the absence of a specific
determination by Agent with respect thereto, payments from any Borrower shall
be applied to amounts then due and payable in the following order: first, to Fees and reimbursable expenses
then due and payable to Agent pursuant to any of the Loan Documents; second, to Fees and any other fees and
reimbursable expenses of Lenders then due and payable to Lenders pursuant to
any of the Loan Documents; third, to
interest then due and payable on the Swing Line Loan; fourth, to the principal balance of the
Swing Line Loan until the same has been repaid in full; fifth, to interest then due and payable on
the Revolving Credit Advances; sixth, to
the outstanding principal balance of the Revolving Credit Advances until the
same has been paid in full; seventh, to
any Letter of Credit Obligations, to provide cash collateral therefor in the
manner set forth in Annex B; and last to
all other Obligations not described in clauses first
through seventh, pro rata to
the Agent and Lenders.  Notwithstanding
the foregoing, if, at the time of any application of any such payment the
Commitment Termination Date has occurred, amounts then due under Hedging
Agreements from any Borrower shall share (i) on a pro rata basis in applications referred to in clauses sixth and seventh,
until all Revolving Credit Advances have been paid in full, all Letter
of Credit Obligations have been fully cash collateralized in the manner set
forth in Annex B and all obligations of such Borrower under its Hedging
Agreements have been paid in full.

 

 

 

(b)                                 Agent
is authorized to, and at its sole election may, charge to the Revolving Loan
balance on behalf of each Borrower and cause to be paid all Fees, expenses,
Charges, costs (including insurance premiums in accordance with Section 5.4(a))
and interest and principal, other than principal of the Revolving Credit
Advances, due and owing by Borrowers under this Agreement or any of the other
Loan Documents if and to the extent Borrowers fail to pay promptly any such
amounts as and when due, even if the amount of such charges would exceed
Borrowing Availability at such time or would cause the aggregate balance of the
Revolving Loan and the Swing Line Loan of any Borrower to exceed such Borrower’s
separate Borrowing Base after giving effect to such charges. At Agent’s option
and to the extent permitted by law, any charges so made shall constitute part
of the Revolving Loan hereunder.

 

1.12                           Loan Account and Accounting

 

Agent, as agent of each Borrower solely for purposes of this Section 1.12,
shall maintain and update from time to time a loan account (the “Loan Account”) on its books to record: (a) all Advances,
including principal thereof and interest thereon, (b) all payments made by
Borrowers and other Credit Parties, and (c) all other debits and credits
as provided in this Agreement with respect to the Loans or any other
Obligations. All entries in the Loan Account shall be made in accordance with
Agent’s customary accounting practices as in effect from time to time. The balance
in the Loan Account, as recorded on Agent’s most recent printout or other
written statement, shall, absent manifest error, be presumptive evidence of the
amounts due and owing to Agent and Lenders by each Borrower; provided, that any failure to so record or
any error in so recording shall not limit or otherwise affect any Borrower’s
duty to pay the Obligations. Agent shall render to Borrower Representative a
monthly accounting of transactions with respect to the Loans setting forth the
balance of the Loan Account (including the principal of each Advance and interest
thereon) as to each Borrower for the immediately preceding month. Unless
Borrower Representative notifies Agent in writing of any objection to any such
accounting (specifically describing the basis for such objection), within thirty
(30) days after the date thereof, each and every such accounting shall (absent
manifest error) be deemed final, binding and conclusive on Borrowers in all
respects as to all matters reflected therein. Only those items expressly
objected to in such notice shall be deemed to be disputed by Borrowers.

 

1.13                           Indemnity

 

(a)                                  Each Credit Party shall jointly and severally
indemnify and hold harmless each of Agent, Arranger, Lenders and their
respective Affiliates, and each such Person’s respective officers, directors,
employees, attorneys, agents and representatives (each, an “Indemnified Person”),
from and against any and all suits, actions, proceedings, claims, damages,
losses, liabilities and expenses (including reasonable attorneys’ fees and disbursements
and other costs of investigation or defense, including those incurred upon any
appeal) that may be instituted or asserted against or incurred by any such
Indemnified Person as the result of credit having been extended, suspended or
terminated under this Agreement and the other Loan Documents and the
administration of such credit, and in

 

 

connection with or arising out of the transactions contemplated
hereunder and thereunder and any actions or failures to act in connection
therewith, including any and all Environmental Liabilities and legal costs and
expenses arising out of or incurred in connection with disputes between or
among any parties to any of the Loan Documents (collectively, “Indemnified Liabilities”); provided, that no Credit Party shall be liable
for any indemnification to an Indemnified Person to the extent that any such
suit, action, proceeding, claim, damage, loss, liability or expense results
solely from that Indemnified Person’s gross negligence or willful misconduct.
NO INDEMNIFIED PERSON SHALL BE RESPONSIBLE OR LIABLE TO ANY OTHER PARTY TO ANY
LOAN DOCUMENT, ANY SUCCESSOR, ASSIGNEE OR THIRD PARTY BENEFICIARY OF SUCH
PERSON OR ANY OTHER PERSON ASSERTING CLAIMS DERIVATIVELY THROUGH SUCH PARTY,
FOR INDIRECT, PUNITIVE, EXEMPLARY OR CONSEQUENTIAL DAMAGES WHICH MAY BE
ALLEGED AS A RESULT OF CREDIT HAVING BEEN EXTENDED, SUSPENDED OR TERMINATED
UNDER ANY LOAN DOCUMENT OR AS A RESULT OF ANY OTHER TRANSACTION CONTEMPLATED
HEREUNDER OR THEREUNDER.

 

(b)                                 To induce Lenders to provide the LIBOR Rate
option on the terms provided herein, if (i) any LIBOR Loans are repaid in
whole or in part prior to the last day of any applicable LIBOR Period (whether
that repayment is made pursuant to any provision of this Agreement or any other
Loan Document or occurs as the result of acceleration, by operation of law or
otherwise), subject to Section 1.3(b)(iv); (ii) any Borrower shall
default in payment when due of the principal amount of or interest on any LIBOR
Loan; (iii) any Borrower shall refuse to accept any borrowing of, or shall
request a termination of, any borrowing of, conversion into or continuation of,
LIBOR Loans after Borrower has given notice requesting the same in accordance
herewith; or (iv) any Borrower shall fail to make any prepayment of a LIBOR
Loan after Borrower has given a notice thereof in accordance herewith, then
Borrowers shall jointly and severally indemnify and hold harmless each Lender
from and against all losses, costs and expenses resulting from or arising from
any of the foregoing. Such indemnification shall include any loss (including
loss of margin) or expense arising from the reemployment of funds obtained by
it or from fees payable to terminate deposits from which such funds were
obtained. For the purpose of calculating amounts payable to a Lender under this
subsection, each Lender shall be deemed to have actually funded its relevant LIBOR
Loan through the purchase of a deposit bearing interest at the LIBOR Rate in an
amount equal to the amount of that LIBOR Loan and having a maturity comparable
to the relevant LIBOR Period; provided, that
each Lender may fund each of its LIBOR Loans in any manner it sees fit, and the
foregoing assumption shall be utilized only for the calculation of amounts
payable under this subsection. This covenant shall survive the termination of
this Agreement and the payment of the Notes and all other amounts payable
hereunder. As promptly as practicable under the circumstances, each Lender
shall provide the applicable Borrower with its written calculation of all amounts
payable pursuant to this Section 1.13(b), and such calculation shall be
binding on the parties hereto unless Borrower Representative

 

 

shall object in writing within 10 Business Days of receipt thereof,
specifying the basis for such objection in detail.

 

1.14                           Access

 

Each Credit Party shall, during normal business hours, from time to
time upon reasonable advance notice as frequently as Agent reasonably
determines to be appropriate: (a) provide Agent and any of its officers,
employees and agents access to its properties, facilities, advisors and
employees (including officers) of such Credit Party and to the Collateral, (b) permit
Agent, and any of its officers, employees and agents, to inspect, audit and
make extracts from such Credit Party’s books and records, and (c) permit
Agent, and its officers, employees and agents, to inspect, review, evaluate and
make test verifications and counts of the Accounts, Inventory and other
Collateral of such Credit Party (clauses (a), (b) and (c) collectively,
“Inspections”). Borrower agrees to
pay to Agent, which are due and payable as incurred, all out of pocket costs
(including fees and expenses) incurred by Agent in relation to any Inspections;
provided, that in addition to
paying for Equipment Inventory Appraisals and P&E Appraisals, Borrowers
only agree to pay such costs and expenses in relation to (unless an Event of
Default has occurred and is continuing) not more than four (4) Inspections
in the first twelve months following the Closing Date and not more than three (3) Inspections
in any subsequent year. If an Event of Default has occurred and is continuing
or if action is necessary to preserve or protect the Collateral as determined
by Agent, each Credit Party shall provide such access to Agent and to each Lender
at all times and without advance notice. Furthermore, so long as any Event of
Default has occurred and is continuing, each Borrower shall provide Agent and
each Lender with access to its suppliers and customers. Each Credit Party shall
make available to Agent and its counsel, as quickly as is possible under the
circumstances, originals or copies of all books and records that Agent may
reasonably request. Each Credit Party shall deliver any document or instrument
necessary for Agent, as it may from time to time reasonably request, to obtain
records from any service bureau or other Person that maintains records for such
Credit Party, and shall maintain duplicate records or supporting documentation
on media consistent with reasonable commercial standards, including computer
tapes and discs owned by such Credit Party. Agent will give Lenders at least
five (5) days’ prior written notice of regularly scheduled Inspections.
Representatives of other Lenders may accompany Agent’s representatives on
regularly scheduled audits at no charge to any Credit Party.

 

1.15                           Taxes

 

(a)                                  Any and all payments by each Credit Party
hereunder (including any payments made pursuant to Section 12) or under
the Notes shall be made, in accordance with this Section 1.15, free and
clear of and without deduction for any and all present or future Taxes, unless
required by law. If any Credit Party shall be required by law to deduct any Taxes
from or in respect of any sum payable hereunder (including any sum payable pursuant
to Section 12) or under the Notes, (i) the sum payable shall be
increased as much as shall be necessary so that after making all required
deductions (including deductions applicable to additional sums payable under
this Section 1.15) Agent or

 

 

Lenders, as applicable, receive an amount
equal to the sum they would have received had no such deductions been made, (ii) such
Credit Party shall make such deductions, and (iii) such Credit Party shall
pay the full amount deducted to the relevant taxing or other authority in accordance
with applicable law. Within thirty (30) days after the date of any payment of
Taxes, Borrower Representative shall furnish to Agent the original or a
certified copy of a receipt evidencing payment thereof. Agent and Lenders shall
not be obligated to return or refund any amounts received pursuant to this
Section, except that in the event a Lender or Agent receives a refund of, or
credit with respect to, any Taxes paid (directly or indirectly) by a Credit
Party pursuant to Section 1.15(a) or Section 1.15(b), such
Lender or Agent, as applicable, shall pay the amount of such refund or credit
to such Credit Party within thirty (30) days of receipt of such refund or
application of such credit; provided that
the calculation of such refund or credit shall be determined solely by such
Lender or Agent, as applicable.

 

(b)                                 Each Credit Party shall jointly and severally
indemnify and, within ten (10) days of demand therefor, pay Agent and each
Lender for the full amount of Taxes (including any Taxes imposed by any jurisdiction
on amounts payable under this Section 1.15) paid by Agent or such Lender,
as appropriate, and any liability (including penalties and interest, neither of
which are the result of gross negligence by Agent or such Lender, and reasonable
expenses) arising therefrom or with respect thereto.

 

(c)                                  Each Lender organized under the laws of a
jurisdiction outside the United States (a “Foreign
Lender”) as to which payments to
be made under this Agreement or under the Notes are exempt from United States
withholding tax under an applicable statute or tax treaty shall provide to
Borrower Representative and Agent, at the time such Foreign Lender becomes a
party to this Agreement, a properly completed and executed IRS Form W-8ECI
or Form W-8BEN or other applicable form, certificate or document prescribed
by the IRS or the United States certifying as to such Foreign Lender’s entitlement
to such exemption (a “Certificate of
Exemption”). Any foreign Person that seeks to
become a Lender under this Agreement shall provide a Certificate of Exemption to
Borrower Representative and Agent prior to becoming a Lender hereunder, and
each Foreign Lender shall complete all further documentation reasonably
requested by Borrower Representative or the Agent required to establish and
maintain such withholding exemption. No foreign Person may become a Lender
hereunder if such Person fails to deliver a Certificate of Exemption in advance
of becoming a Lender.

 

1.16                           Capital Adequacy; Increased Costs; Illegality

 

(a)                                  If any Lender shall have determined in good
faith that any law, treaty, governmental (or quasi-governmental) rule,
regulation, guideline or order regarding capital adequacy, reserve requirements or similar requirements
or compliance by any Lender with any request or directive regarding capital
adequacy, reserve requirements or similar requirements (whether or not having
the force of law), in each case adopted after the Closing Date, from any
central bank or other Governmental Authority increases or would

 

 

have the effect of increasing the amount of capital, reserves or other
funds required to be maintained by such Lender and thereby reducing the rate of
return on such Lender’s capital as a consequence of its obligations hereunder,
then Borrowers shall from time to time upon written demand by such Lender (with
a copy of such demand to Agent) pay to Agent, for the account of such Lender,
additional amounts sufficient to compensate such Lender for such reduction. A
certificate as to the amount of that reduction and showing the basis of the
computation thereof submitted by such Lender to Borrower Representative and to
Agent shall, absent manifest error, be final, conclusive and binding for all
purposes.

 

(b)                                 If, due to either (i) the introduction
of or any change in any law or regulation (or any change in the interpretation
thereof) or (ii) the compliance with any guideline or request from any
central bank or other Governmental Authority (whether or not having the force of
law), in each case adopted after the Closing Date, there shall be any increase
in the cost to any Lender of agreeing to make or making, funding or maintaining
any Loan (excluding for purposes of this Section 1.16(b) Taxes, as to
which Section 1.15 shall govern), then Borrowers shall from time to time,
upon written demand by such Lender (with a copy of such demand to Agent), pay
to Agent for the account of such Lender additional amounts sufficient to
compensate such Lender for such increased cost. A certificate as to the amount
of such increased cost, submitted to Borrower Representative and to Agent by
such Lender, shall be conclusive and binding on Borrowers for all purposes,
absent manifest error. Each Lender agrees that, as promptly as practicable
after it becomes aware of any circumstances referred to above which would
result in any such increased cost, the affected Lender shall, to the extent not
inconsistent with such Lender’s internal policies of general application, use
reasonable commercial efforts to minimize costs and expenses incurred by it and
payable to it by Borrowers pursuant to this Section 1.16(b).

 

(c)                                  Notwithstanding anything to the contrary
contained herein, if the introduction of or any change in any law or regulation
(or any change in the interpretation thereof) shall make it unlawful, or any central
bank or other Governmental Authority shall assert that it is unlawful, for any
Lender to agree to make or to make or to continue to fund or maintain any LIBOR Loan, then, unless that Lender
is able to make or to continue to fund or to maintain such LIBOR Loan at
another branch or office of that Lender without, in that Lender’s good faith
opinion, adversely affecting it or its Loans or the income obtained therefrom,
on written notice thereof and written demand therefor by such Lender to Borrower
Representative through Agent, (i) the obligation of such Lender to agree to make
or to make or to continue to fund or maintain LIBOR Loans shall terminate and (ii) each
Borrower shall forthwith prepay in full all outstanding LIBOR Loans owing by such
Borrower to such Lender, together with interest accrued thereon, unless such Borrower,
within five (5) Business Days after the delivery of such notice and
demand, converts all LIBOR Loans into Index Rate Loans.

 

 

(d)                                 Within fifteen (15) days after receipt by
Borrower Representative of written notice and demand from any Lender (an “Affected Lender”) for payment of
additional amounts, increased costs or reserve costs as provided in Section 1.15(a),
1.15(b), 1.16(a), 1.16(b) or 1.16(c), Borrower Representative may, at its
option, notify Agent and such Affected Lender of its intention to replace the
Affected Lender. So long as no Default or Event of Default has occurred and is
continuing, Borrower Representative, with the consent of Agent not to be
unreasonably withheld, may obtain, at Borrowers’ expense, a replacement Lender (“Replacement Lender”) for the Affected Lender,
which Replacement Lender must be reasonably satisfactory to Agent. If Borrower Representative
obtains a Replacement Lender within ninety (90) days following notice of its
intention to do so, the Affected Lender must sell and assign (in accordance
with the register requirements for assignments in Section 9.1) its Loans
and Commitments to such Replacement Lender for an amount equal to the principal
balance of all Loans held by the Affected Lender and all accrued interest and
Fees with respect thereto through the date of such sale, provided, that Borrowers shall have
reimbursed such Affected Lender for the additional amounts or increased costs
that it is entitled to receive under this Agreement through the date of such
sale and assignment. Notwithstanding the foregoing, Borrowers shall not have
the right to obtain a Replacement Lender if the Affected Lender rescinds its
demand for increased costs or additional amounts within fifteen (15) days
following its receipt of Borrower Representative’s notice of intention to
replace such Affected Lender. Furthermore, if Borrower Representative gives a
notice of intention to replace and does not so replace such Affected Lender
within ninety (90) days thereafter, Borrowers’ rights under this Section 1.16(d) shall
terminate and Borrowers shall promptly pay all increased costs or additional
amounts demanded by such Affected Lender pursuant to Sections 1.15(a), 1.16(a) and
1.16(b).

 

(e)                                  Notwithstanding the provisions of Section 1.16(a) and
(b), if any Lender fails to notify Borrower Representative of any event or
circumstance which will entitle such Lender to compensation pursuant to Section 1.16(a) or
(b) within 180 days after such Lender becomes aware of such event or
occurrence, then such Lender shall not be entitled to compensation from
Borrowers for any amount arising prior to the date which is 180 days before the
date of such notice to Borrower Representative.

 

1.17                           Single Loan

 

All Loans to each Borrower and all of the other Obligations of each
Borrower arising under this Agreement and the other Loan Documents shall
constitute one general obligation of that Borrower secured, until the
Termination Date, by all of the
Collateral.

 

 

2.              CONDITIONS PRECEDENT

 

2.1                                 Conditions to the Initial Loans

 

No Lender shall be obligated to make any Loan to, or incur any Letter
of Credit Obligations on the Closing Date, or to take, fulfill or perform any
other action hereunder, until the following conditions have been satisfied or
provided for in a manner satisfactory to Agent, or waived in writing by Agent
and Lenders:

 

(a)                                  Credit Agreement; Loan Documents

 

This Agreement or counterparts hereof shall have been duly executed by,
and delivered to, each Credit Party, Agent and Lenders; and Agent shall have
received such documents, instruments, agreements and legal opinions as Agent
shall reasonably request in connection with the transactions contemplated by
this Agreement and the other Loan Documents, including all those listed in the
Closing Checklist attached hereto as Annex D, each in form and substance
reasonably satisfactory to Agent.

 

(b)                                 Repayment of Prior Obligations; Satisfaction
of Outstanding L/Cs

 

(i)                                     Agent shall have received fully executed
originals of pay-off letters reasonably satisfactory to Agent confirming that
all of the Prior Obligations will be repaid in full from the proceeds of the
initial Revolving Credit Advance and all Liens upon any of the property of
Borrowers or any of their Subsidiaries in favor of any Prior Lender shall be
terminated by such Prior Lender immediately upon such payment; and

 

(ii)                                  all letters of credit issued or guaranteed by
such Prior Lender shall have been terminated, cash collateralized, supported by
a guaranty of Agent or supported by a Letter of Credit issued pursuant to Annex
B, as mutually agreed upon by Agent, Borrowers and such Prior Lender.

 

(c)                                  Approvals

 

Agent shall have received (i) reasonably satisfactory evidence
that each Credit Party has obtained all required consents and approvals of all
Persons including all requisite Governmental Authorities, to the execution,
delivery and performance of this Agreement and the other Loan Documents and the
consummation of the Related Transactions or (ii) a certificate of an
Authorized Officer in form and substance reasonably satisfactory to Agent
affirming that no such consents or approvals are required.

 

(d)                                 Opening Availability

 

The Eligible Accounts, Eligible Rentals, Eligible Parts and Tools Inventory,
Eligible Rolling Stock and Eligible Equipment Inventory supporting the initial
Revolving Credit Advance and the initial Letter of Credit Obligations incurred
and the amount of the

 

 

Reserves to be established on the Closing Date shall be sufficient in
value, as determined by Agent, to provide Borrowers, collectively, with
Borrowing Availability, after giving effect to the initial Revolving Credit
Advance made to each Borrower, the incurrence of any initial Letter of Credit
Obligations and the consummation of the Related Transactions (on a pro forma basis, with trade payables being
paid currently, and expenses and liabilities being paid in the ordinary course
of business and without acceleration of sales) of at least $50,000,000.

 

(e)                                  Payment of Fees

 

Borrowers shall have paid the Fees required to be paid on the Closing
Date in the respective amounts specified in Section 1.9 (including the
Fees specified in the GE Capital Fee Letter), and shall have reimbursed Agent
for all fees, costs and expenses of closing presented as of the Closing Date in
accordance with Section 11.3.

 

(f)                                    Capital Structure: Other Indebtedness

 

The organizational documents, terms of equity interests, capital
structure of each Credit Party and the terms and conditions of all Indebtedness
of each Credit Party shall be reasonably acceptable to Agent.

 

(g)                                 Due Diligence

 

Agent shall have completed its business and legal due diligence with
results reasonably satisfactory to Agent.

 

(h)                                 Funding of Senior Debt

 

Agent shall have received (i) evidence satisfactory to it that
Borrowers shall have received not less than (x) $200,000,000 (less discounts
and commissions) in cash in consideration of the issuance of Senior Notes
pursuant to the Senior Note Indenture and - (y) $50,000,000 (less discounts and
commissions) in cash in consideration of the issuance of Senior Subordinated
Notes pursuant to the Senior Subordinated Note Indenture, (ii) fully executed
copies of the Senior Note Indenture and Senior Subordinated Note Indenture in
form and substance reasonably satisfactory to it and (iii) the
Intercreditor Agreement, executed and delivered on behalf of the Collateral
Agent.

 

(i)                                     Consummation of Related Transactions

 

Agent shall have received fully executed copies of the Contribution
Agreement and Plan of Reorganization and each of the other Related Transactions
Documents, each of which shall be in form and substance reasonably satisfactory
to Agent and its counsel. The Mergers and the other Related Transactions shall
have been consummated in accordance with the terms of the Contribution
Agreement and Plan of Reorganization and the other Related Transaction
Documents.

 

 

2.2                            Further Conditions to Each Loan

 

Except as otherwise expressly provided herein, no Lender shall be
obligated to fund any Advance, convert or continue any Loan as a LIBOR Loan or
incur any Letter of Credit Obligation, if, as of the date thereof:

 

(a)                                  (i) any representation or warranty by
any Credit Party contained herein or in any other Loan Document is untrue or
incorrect as of such date in any material respect, except to the extent that
such representation or warranty expressly relates to an earlier date and except
for changes therein expressly permitted or expressly contemplated by this Agreement
and (ii) Agent or Requisite Lenders have determined not to make such Advance,
convert or continue any Loan as a LIBOR Loan or incur such Letter of Credit Obligation
as a result of the fact that such warranty or representation is untrue or incorrect;
or

 

(b)                                 (i) any event or circumstance having a
Material Adverse Effect has occurred since the date hereof as determined by the
Requisite Lenders and (ii) Agent or Requisite Lenders have determined not
to make such Advance, convert or continue any Loan as a LIBOR Loan or incur
such Letter of Credit Obligation as a result of the feet that such event or circumstance
has occurred; or

 

(c)                                  (i) any Default or Event of Default has
occurred and is continuing or would result after giving effect to any Advance
(or the incurrence of any Letter of Credit Obligation), and (ii) Agent or
Requisite Lenders shall have determined not to make any Advance, convert or
continue any Loan as a LIBOR Loan or incur any Letter of Credit Obligation as a
result of such Default or Event of Default; or

 

(d)                                 after giving effect to any Advance (or the
incurrence of any Letter of Credit Obligations), (i) the outstanding
principal amount of the aggregate Revolving Loan would exceed the lesser of the
Aggregate Borrowing Base and the Maximum Amount, in each case, less the aggregate
outstanding Swing Line Loan at such time, or (ii) the outstanding
principal amount of the Revolving Loan to the applicable Borrower would exceed
such Borrower’s separate Borrowing Base less the aggregate outstanding
Swing Line Loan at such time, to that Borrower; or

 

(e)                                  after giving effect to any Swing Line
Advance, the outstanding principal amount of the Swing Line Loan would exceed
Swing Line Availability.

 

The request and acceptance by any Borrower of the proceeds of any
Advance, the incurrence of any Letter of Credit Obligations or the conversion
or continuation of any Loan into, or as, a LIBOR Loan, shall be deemed to
constitute, as of the date thereof, (i) a representation and warranty by
such Borrower that the conditions in this Section 2.2 have been satisfied
and (ii) a reaffirmation by such Borrower of the cross-guaranty provisions
set forth in Section 12 and of the granting and continuance of Agent’s
Liens, on behalf of itself and Lenders, pursuant to the Collateral Documents.

 

 

3.              REPRESENTATIONS AND WARRANTIES

 

To induce Lenders to make the Loans and to incur Letter of Credit
Obligations, each Credit Party, jointly and severally, makes the following
representations and warranties to Agent and each Lender, with respect to all
Credit Parties, each and all of which shall survive the execution and delivery
of this Agreement.

 

3.1                                 Corporate or Limited Liability Company
Existence; Compliance with Law

 

Each Credit Party (a) is a limited liability company or
corporation, as applicable, duly organized, validly existing and in good
standing under the laws of its respective jurisdiction of organization or
incorporation set forth in Disclosure Schedule (3.1); (b) is duly
qualified to conduct business and is in good standing in each other
jurisdiction where its ownership or lease of property or the conduct of its
business requires such qualification, except where the failure to be so
qualified would not result in exposure to losses, damages or liabilities in
excess of $50,000; (c) has the requisite corporate or limited liability
company, as applicable, power and authority and the legal right to own, pledge,
mortgage or otherwise encumber and operate its properties, to lease the
property it operates under lease and to conduct its business as is now, heretofore
and is proposed to be conducted; (d) has all material licenses, permits,
consents or approvals from or by, and has made all material filings with, and
has given all material notices to, all Governmental Authorities having
jurisdiction, to the extent required for such ownership, operation and conduct;
(e) is in compliance with its charter and bylaws or certificate of
formation and operating agreement, as applicable; and (f) subject to
specific representations set forth herein regarding ERISA, Environmental Laws,
tax and other laws, is in compliance with all applicable provisions of law;
except in the case of clauses (b), (d) and (f) of this Section 3.1,
where the failure to comply, individually or in the aggregate, could not
reasonably be expected to have a Material Adverse Effect.

 

3.2                                 Executive Offices; Collateral Locations; FEIN

 

As of the Closing Date, the current location of each Credit Party’s
chief executive office and the warehouses and premises at which any Collateral
is located are set forth in Disclosure Schedule (3.2), and none of such
locations has changed within the 12 months preceding the Closing Date. In
addition, Disclosure Schedule (3.2) lists the jurisdiction of
organization, organizational identification number, if any, and federal employer
identification number of each Credit Party.

 

3.3                                 Corporate or Limited Liability Company Power,
Authorization, Enforceable Obligations

 

The execution, delivery and performance by each Credit Party of the
Loan Documents to which it is a party and the creation of all Liens provided
for therein: (a) are within such Credit Party’s corporate or limited
liability company, as applicable, power; (b) have been duly authorized by
all necessary corporate, limited liability company, shareholder and member
action, as applicable; (c) do not contravene any provision of such Credit
Party’s certificate of formation, operating agreement, charter or by-laws, as
applicable; (d) do not violate any law or regulation, or any order

 

 

or decree of any court or Governmental Authority; (e) do not
conflict with or result in the breach or termination of, constitute a default
under or accelerate or permit the acceleration of any performance required by,
any indenture, mortgage, deed of trust, lease, agreement or other instrument to
which such Credit Party is a party or by which such Credit Party or any of its
property is bound that alone or in the aggregate could reasonably be expected
to have a Material Adverse Effect; (f) do not result in the creation or
imposition of any Lien upon any of the property of such Credit Party other than
Permitted Encumbrances or those in favor of Agent, on behalf of itself and
Lenders, pursuant to the Loan Documents; and (g) do not require the
consent or approval of any Governmental Authority or any other Person, except
those referred to in Section 2. l(c), all of which will have been duly
obtained, made or complied with prior to the Closing Date. Each of the Loan
Documents shall be duly executed and delivered by each Credit Party that is a
party thereto and each such Loan Document shall constitute a legal, valid and
binding obligation of such Credit Party enforceable against it in accordance
with its terms, subject to any applicable bankruptcy, insolvency, moratorium or
similar laws affecting creditors’ rights generally and to general principles of
equity.

 

3.4                                 Financial Statements and Projections

 

Except for the Projections, the Fair Salable Balance Sheet and the
Financial Statements referenced in items (a)(iii) and (a)(iv) below,
all Financial Statements concerning any Credit Party and its Subsidiaries that
are referred to below have been prepared in accordance with GAAP consistently
applied throughout the periods covered (except as disclosed therein and except,
with respect to unaudited Financial Statements, for the absence of footnotes
and normal year-end audit adjustments) and present fairly in all material
respects the financial position of the Persons covered thereby as at the dates
thereof and the results of their operations and cash flows for the periods then
ended.

 

(a)                                  Financial Statements

 

The following Financial Statements attached hereto as Disclosure Schedule (3.4(a))
have been delivered on the date hereof:

 

(i)                                     The audited consolidated and consolidating
balance sheets at December 31, 2001 and the related statements of income
and cash flows of ICM and its Subsidiaries for the Fiscal Year then ended
certified by KPMG Peat Marwick LLP.

 

(ii)                                  The audited consolidated and consolidating
balance sheets as of December 31, 2001 and the related statements of
income and cash flows of Gulf Wide and its Subsidiaries for the Fiscal Year
then ended, certified by KPMG Peat Marwick LLP.

 

(iii)                               The unaudited balance sheets as of March 31,
2002 and the related statements of income and cash flows of ICM and its Subsidiaries
for the Fiscal Quarter then ended.

 

 

(iv)                              The unaudited balance sheets as of March 31,
2002 and the related statements of income and cash flows of Gulf Wide and its
Subsidiaries for the Fiscal Quarter then ended.

 

(b)                                 Pro Forma

 

The Pro Forma delivered on or prior to the date hereof and attached
hereto as Disclosure Schedule (3.4(b)) was prepared by Borrowers giving pro forma effect to the Related
Transactions, was based on the unaudited consolidated and consolidating balance
sheets of ICM and its Subsidiaries dated March 31, 2002, Head & Engquist Equipment and its Subsidiaries
dated March 31, 2002 and Gulf Wide and its Subsidiaries dated March 31,
2002 and was prepared in accordance with GAAP, with only such adjustments
thereto as would be required in accordance with GAAP.

 

(c)                                  Projections

 

The Projections delivered on or prior to the date hereof and attached
hereto as Disclosure Schedule (3.4(c)) have been prepared by Borrowers in
light of the past operations of their businesses, but including future payments
of known contingent liabilities reflected on the Fair Salable Balance Sheet,
and reflect projections for the five (5) year period beginning on January 1,
2002 on a quarter by quarter basis for the first year and on a year by year
basis thereafter. The Projections are based upon estimates and assumptions
stated therein, all of which Borrowers believe to be reasonable and fair in
light of current conditions and current facts known to Borrowers and, as of the
Closing Date, reflect Borrowers’ good faith and reasonable estimates of the
future financial performance of Borrowers and of the other information
projected therein for the period set forth therein.

 

(d)                                 Fair Salable Balance Sheet

 

The Fair Salable Balance Sheet delivered on or prior to the date hereof
and attached hereto as Disclosure Schedule (3.4(d)) was prepared by
Borrowers on the same basis as the Projections, except that Borrowers’ assets
are set forth therein at their fair salable values on a going concern basis and
the liabilities set forth therein include all contingent liabilities of
Borrowers stated at the reasonably estimated present values thereof.

 

3.5                                 Material Adverse Effect

 

Between December 31, 2001 and the Closing Date: (a) none of
the Credit Parties has incurred any obligations, contingent or noncontingent
liabilities, liabilities for Charges, long-term leases or unusual forward or
long-term commitments that are not reflected in the Pro Forma and that, alone
or in the aggregate, could reasonably be expected to have a Material Adverse
Effect, (b) no contract, lease or other agreement or instrument has been
entered into by any Credit Party or has become binding upon any Credit Party’s
assets and no law or regulation applicable to any Credit Party has been adopted
that has had or could reasonably be expected to have a Material Adverse Effect,
and (c) no Credit Party is in default and to the best of any Credit Party’s
knowledge no

 

 

third party is in default under any material
contract, lease or other agreement or instrument, that alone or in the
aggregate could reasonably be expected to have a Material Adverse Effect.
Between December 31, 2001 and the Closing Date no event has occurred, that
alone or together with other events, could reasonably be expected to have a
Material Adverse Effect. For all purposes of this Section 3.5, the
entering into of the Related Transaction Documents and the consummation of the
Related Transactions shall be deemed not to have a Material Adverse Effect.

 

3.6                             Ownership of Property; Liens

 

(a)                                  As of the Closing Date, the real estate
(together with any real property acquired by any Borrower or Guarantor after
the Closing Date, “Real Estate”)
designated as such and listed in Disclosure Schedule (3.6) constitutes all
of the real property owned, leased, subleased, or operated by any Credit Party.
Except as disclosed in Disclosure Schedule (3.6), each Credit Party owns
good and marketable fee simple title to all of its owned Real Estate, and valid
and marketable leasehold interests in all of its leased Real Estate, all as
more particularly described on such schedule, and copies of all such leases or
a summary of terms thereof reasonably satisfactory to Agent have been delivered
to Agent. Disclosure Schedule (3.6) further describes any Real Estate with
respect to which any Credit Party is a lessor, sublessor or assignor as of the
Closing Date. Each Credit Party also has good and marketable title to, or valid
leasehold interests in, all of its personal properties and assets, including,
without limitation, those titled vehicles described in Disclosure Schedule (3.6)
(the “Titled Vehicles”). As of the
Closing Date, none of the properties and assets of any Credit Party are subject
to any Liens other than Permitted Encumbrances, and there are no facts,
circumstances or conditions known to any Credit Party that may result in any
Liens (including Liens arising under Environmental Laws) other than Permitted
Encumbrances. Except as described in Disclosure Schedule (3.6), each
Credit Party has received all deeds, certificates of title, assignments,
waivers, consents, nondisturbance and attornment or similar agreements, bills
of sale and other documents, and has duly effected all recordings, filings and
other-actions necessary to establish, protect and perfect such Credit Party’s
right, title and interest in and to all such Real Estate and other properties
and assets including, without limitation, the Titled Vehicles. Disclosure Schedule (3.6)
also describes any purchase options, rights of first refusal or other similar
contractual rights pertaining to any Real Estate. No portion of any Credit
Party’s Real Estate has suffered any material damage by fire or other casualty
loss mat has not heretofore been repaired and restored in all material respects
to its original condition or otherwise remedied. All material permits required
to have been issued or appropriate to enable the Real Estate to be lawfully
occupied and used for all of the purposes for which it is currently occupied
and used have been lawfully issued and are in full force and effect.

 

 

3.7                                 Labor Matters

 

As of the Closing Date (a) no strikes or other material labor
disputes against any Credit Party are pending or, to any Credit Party’s
knowledge, threatened that could reasonably be expected to have a Material
Adverse Effect; (b) hours worked by and payment made to employees of each
Credit Party comply in all material respects with the Fair Labor Standards Act
and each other federal, state, local or foreign law applicable to such matters;
(c) all payments due from any Credit Party for employee health and welfare
insurance have been paid or accrued as a liability on the books of such Credit
Party; (d) except as set forth in Disclosure Schedule (3.7), no
Credit Party is a party to or bound by any collective bargaining agreement,
management agreement, consulting agreement, employment agreement, bonus,
restricted stock, stock option, stock appreciation plan or agreement or any
similar plan, agreement or arrangement (and true and complete copies of any
agreements described in Disclosure Schedule (3.7) have been delivered to
Agent); (e) except as set forth in Disclosure Schedule (3.7), there
is no organizing activity involving any Credit Party pending or, to any Credit
Party’s knowledge, threatened by any labor union or group of employees; (f) except
as set forth in Disclosure Schedule (3.7), there are no representation
proceedings pending or, to any Credit Party’s knowledge, threatened with the
National Labor Relations Board, and no labor organization or group of employees
of any Credit Party has made a pending demand for recognition; and (g) except
as set forth in Disclosure Schedule (3.7), there are no complaints or
charges against any Credit Party pending or, to the knowledge of any Credit
Party, threatened to be filed with any Governmental Authority or arbitrator
based on, arising out of, in connection with, or otherwise relating to the
employment or termination of employment by any Credit Party of any individual
mat could reasonably be expected to have a Material Adverse Effect.

 

3.8                                 Ventures, Subsidiaries and Affiliates;
Outstanding Stock and Indebtedness

 

Except as set forth in Disclosure Schedule (3.8), as of the
Closing Date, no Credit Party has any Subsidiaries, is engaged in any joint
venture or partnership with any other Person, or is an Affiliate of any other
Person. All of the issued and outstanding Stock of each Credit Party is owned
by each of the members or Stockholders, as applicable, and in the amounts set
forth in Disclosure Schedule (3.8). Except as set forth in Disclosure Schedule (3.8),
there are no outstanding rights to purchase, options, warrants or similar
rights or agreements pursuant to which any Credit Party may be required to
issue, sell, repurchase or redeem any of its Stock or other equity securities or
any Stock or other equity securities of its Subsidiaries. All outstanding
Indebtedness and Guaranteed Indebtedness of each Credit Party as of the Closing
Date is described in Section 6.3 (including Disclosure Schedule (6.3)).
None of the Credit Parties other than Borrowers has any assets (except Stock of
their Subsidiaries) or any Indebtedness or Guaranteed Indebtedness (except the
Obligations). No Credit Party has any outstanding Indebtedness or true lease
obligations secured by a Lien described in Section 6.7(c) or Section 6,7(d) except
as described in Disclosure Schedule (6.3) under the heading “Vendor
Financings.”

 

 

3.9                                 Government Regulation

 

No Credit Party is an “investment company” or an “affiliated person”
of, or “promoter” or “principal underwriter” for, an “investment company,” as such
terms are defined in the Investment Company Act of 1940. No Credit Party is
subject to regulation under the Public Utility Holding Company Act of 1935, the
Federal Power Act, or any other federal or state statute that restricts or
limits its ability to incur Indebtedness or to perform its obligations
hereunder. The making of the Loans by Lenders to Borrowers, the incurrence of
the Letter of Credit Obligations on behalf of Borrowers, the application of the
proceeds thereof and repayment thereof and the consummation of the Related
Transactions will not violate any provision of any such statute or any rule,
regulation or order issued by the Securities and Exchange Commission.

 

3.10                           Margin Regulations

 

No Credit Party is engaged, nor will it engage, principally or as one
of its important activities, in the business of extending credit for the
purpose of “purchasing” or “carrying” any “margin stock” as such terms are
defined in Regulation U of the Federal Reserve Board as now and from time to
time hereafter in effect (such securities being referred to herein as “Margin Stock”).
No Credit Party owns any Margin Stock, and none of the proceeds of the Loans or
other extensions of credit under this Agreement will be used, directly or
indirectly, for the purpose of purchasing or carrying any Margin Stock, for the
purpose of reducing or retiring any Indebtedness that was originally incurred
to purchase or carry any Margin Stock or for any other purpose that might cause
any of the Loans or other extensions of credit under this Agreement to be
considered a “purpose credit” within the meaning of Regulations T, U or X of
the Federal Reserve Board. No Credit Party will take or permit any Subsidiary
to take any action that might cause any Loan Document to violate any regulation
of the Federal Reserve Board.

 

3.11                           Taxes

 

All tax returns, reports and statements, including information returns,
required by any Governmental Authority to be filed by any-Credit Party have
been filed with the appropriate Governmental Authority and all Charges have
been paid prior to the date on which any fine, penalty, interest or late charge
may be added thereto for nonpayment thereof (or any such fine, penalty,
interest, late charge or loss has been paid), except (a) Charges or other
amounts being contested in accordance with Section 5.2(b) or (b) to
the extent that the failure to file or pay could not reasonably be expected to
result in a Material Adverse Effect. Proper and accurate amounts have been
withheld by each Credit Party from its respective employees for all periods in
full and complete compliance with all applicable federal, state, local and
foreign laws and such withholdings have been timely paid to the respective
Governmental Authorities. Disclosure Schedule (3.11) sets forth as of the
Closing Date those taxable years for which any Credit Party’s tax returns are
currently being audited by the IRS or any other applicable Governmental
Authority and any assessments or threatened assessments in connection with such
audit, or otherwise currently outstanding. Except as described in Disclosure Schedule (3.11),
no Credit Party has executed or filed with the IRS or any other Governmental
Authority any agreement or

 

 

other document extending, or having the effect of extending, the period
for assessment or collection of any Charges. None of the Credit Parties or
their respective predecessors are liable for any Charges: (a) under any
agreement (including any tax sharing agreements) or (b) to any Credit
Party’s knowledge, as a transferee. As of the Closing Date, no Credit Party has
agreed or been requested to make any adjustment under IRC Section 481(a),
by reason of a change in accounting method or otherwise, which would have a
Material Adverse Effect.

 

3.12                           ERISA

 

(a)                                  Disclosure Schedule (3.12) lists all
Plans and separately identifies all Pension Plans, including Title IV Plans,
Multiemployer Plans and Welfare Plans, including all Retiree Welfare Plans.
Copies of all Title IV Plans, together with a copy of the latest IRS/DOL 5500-series
form for each such Title IV Plan, have been made available to Agent. Except as
would not reasonably be expected to have a Material Adverse Effect (i) except
with respect to Multiemployer Plans, each Qualified Plan has received a favorable
determination letter from the IRS, and nothing has occurred that would cause
the loss of such Qualified Plans qualification; (ii) each Plan is in
compliance in all material respects with the applicable provisions of ERISA and
the IRC, including the timely filing of all reports required under the IRC or
ERISA; (iii) neither any Credit Party nor any ERISA Affiliate has failed
to make any contribution or pay any amount due as required by either Section 412
of the IRC or Section 302 of ERISA or the terms of any Title IV Plan; and (iv) no
Credit Party or any ERISA Affiliate has engaged in a “prohibited transaction”,
as defined in Section 406 of ERISA and Section 4975 of the IRC, that
will subject any Credit Party to a material tax on prohibited transactions
imposed by Section 502(i) of ERISA or Section 4975 of the IRC.

 

(b)                                 Except as set forth in Disclosure Schedule (3.12):
(i) no Title IV Plan has any material Unfunded Pension Liability; (ii) no
ERISA Event or event described in Section 4062(e) of ERISA with
respect to any Title IV Plan has occurred or is reasonably expected to occur
that could reasonably be expected a Material Adverse Effect; (iii) there are
no pending, or to the knowledge of any Credit Party, threatened claims (other
than claims for benefits in the normal course), sanctions, actions or lawsuits,
asserted or instituted against any Plan or any Person as fiduciary or sponsor
of any Plan that could reasonably be expected to have a Material Adverse
Effect; (iv) no Credit Party or ERISA Affiliate has incurred or reasonably
expects to incur any liability as a result of a complete or partial withdrawal
from a Multiemployer Plan that could reasonably be expected to have a Material
Adverse Effect; (v) within the last five years no Title IV Plan of any Credit
Party or ERISA Affiliate has been terminated, whether or not in a “standard termination”
as that term is used in Section 4041(b)(l) of ERISA, nor has any Title IV Plan
of any Credit Party or any ERISA Affiliate (determined at any time within the last
five years) with Unfunded Pension Liabilities been transferred outside of the “controlled
group” (within the meaning of Section 400l(a)(14) of ERISA) of any Credit
Party or ERISA Affiliate (determined at the time of any such transfer).

 

 

3.13                           No Litigation

 

No action, claim, lawsuit, demand, investigation or proceeding is now
pending or, to the knowledge of any Credit Party, threatened against any Credit
Party or before any Governmental Authority or before any arbitrator or panel of
arbitrators (collectively, “Litigation”), (a) that
challenges any Credit Party’s, right or power to enter into or perform any of
its obligations under any Related Transaction Document or any Loan Document to
which it is a party, or the validity or enforceability of any Related
Transaction Document or any Loan Document or any action taken thereunder, or (b) that
has a reasonable risk of being determined adversely to any Credit Party, and
which, if so determined, could reasonably be expected to have a Material
Adverse Effect. Except as set forth in Disclosure Schedule (3.13), as of
the Closing Date there is no Litigation pending or to any Credit Party’s
knowledge threatened against any Credit Party that seeks damages in excess of
$100,000 or injunctive relief against, or alleges criminal misconduct of, any
Credit Party.

 

3.14                           Brokers

 

No broker or finder brought about the obtaining, making or closing of
the Loans or the Related Transactions, and no Credit Party or Affiliate thereof
has any obligation to any Person in respect of any finder’s or brokerage fees
in connection therewith, except for (i) a fee paid to Bruckman, Rosser,
Sherrill & Co., Inc. (“BRS Management Co.”)
on the Closing Date in the amount of $7,218,750 pursuant to the terms of the
First Amended and Restated Management Agreement dated as of the date hereof
(the “BRS Management Agreement”) by and
among BRS Management Co., H&E Holdings and H&E, such fee to be used in
full to purchase on the Closing Date Senior Subordinated Notes and common units
of H&E Holdings, and (ii) payments in accordance with Section 6.14(d).

 

3.15                           Intellectual Property

 

As of the Closing Date, each Credit Party owns or has rights to use all
Intellectual Property material to the continuance of the conduct of its
business as now or heretofore conducted by it or proposed to be conducted by
it, and each Patent, each registration or each application for registration of
each Trademark, each Copyright and each License is listed, together with
application or registration numbers, as applicable, in Disclosure Schedule (3.15).
Each Credit Party conducts its business and affairs without material
infringement of or material interference with any Intellectual Property of any
other Person. Except as set forth in Disclosure Schedule (3.15), no Credit
Party is aware of any infringement claim by any other Person with respect to
any Intellectual Property.

 

3.16                           Full Disclosure

 

No information contained in this Agreement, any of the other Loan
Documents, any Projections, Financial Statements or Collateral Reports or other
written reports from time to time delivered hereunder or any written statement
furnished by or on behalf of any Credit Party to Agent or any Lender pursuant
to the terms of this Agreement contains or will contain any untrue statement of
a

 

 

material fact or omits or will omit to state a material fact necessary
to make the statements contained herein or therein not misleading in light of
the circumstances under which they were made. The Liens granted to Agent, on
behalf of itself and Lenders, pursuant to the Collateral Documents will at all
times be fully perfected first priority Liens in and to the Collateral
described therein, subject, as to priority, only to Permitted Encumbrances.

 

3.17                           Environmental Matters

 

(a)                                  Except as set forth in Disclosure Schedule (3.17),
as of the Closing Date: (i) the Real Estate is free of contamination from
any Hazardous Material except for such contamination that would not adversely
impact the value or marketability of such Real Estate and that would not result
in Environmental Liabilities that could reasonably be expected to exceed
$250,000; (ii) no Credit Party has caused or suffered to occur any Release
of Hazardous Materials on, at, in, under, above, to, from or about any of its
Real Estate that would result in Environmental Liabilities that could
reasonably be expected to exceed $250,000; (iii) each Credit Party is and
has been in compliance with all Environmental Laws, except for such
noncompliance that would not result in Environmental Liabilities which could reasonably
be expected to exceed $250,000; (iv) each Credit Party has obtained, and
is in compliance with, all Environmental Permits required by Environmental Laws
for the operations of its businesses as presently conducted or as proposed to
be conducted, except where the failure to so obtain or comply with such
Environmental Permits would not result in Environmental Liabilities that could
reasonably be expected to exceed $250,000, and all such Environmental Permits
are valid, uncontested and in good standing; (v) no Credit Party is
involved in operations or knows of any facts, circumstances or conditions,
including any Releases of Hazardous Materials, that are likely to result in any
Environmental Liabilities of Borrower that could reasonably be expected to exceed
$250,000, and no Credit Party has permitted any current or former tenant or
occupant of the Real Estate to engage in any such operations; (vi) there
is no Litigation arising under or related to any Environmental Laws,
Environmental Permits or Hazardous Material that seeks damages, penalties,
fines, costs or expenses in excess of $100,000 or injunctive relief, or which
alleges criminal misconduct by any Credit Party, (vii) no notice has been
received by any Credit Party identifying it as a “potentially responsible party”
or requesting information under CERCLA or analogous state statutes, and to the
knowledge of any Credit Party, there are no facts, circumstances or conditions
that may result in any Credit Party being identified as a “potentially responsible
party” under CERCLA or analogous state statutes; and (viii) the Credit
Parties have provided to Agent copies of all material existing environmental
reports, reviews and audits and all material written information in their
possession pertaining to actual or potential Environmental Liabilities, in each
case relating to the Credit Parties.

 

(b)                                 Each Credit Party hereby acknowledges and
agrees that Agent (i) is not now, and has not ever been in control of any
of the Real Estate or any Credit Party’s affairs, and (ii) does

 

 

not have the capacity through the provisions of the Loan Documents or
otherwise to influence any Credit Party’s conduct with respect to the
ownership, operation or management of any of its Real Estate or compliance with
Environmental Laws or Environmental Permits.

 

3.18                           Insurance

 

Disclosure Schedule (3.18) lists all insurance policies of any
nature maintained, as of the Closing Date, for current occurrences by each
Credit Party, as well as a summary of the terms of each such policy.

 

3.19                           Deposit and Disbursement Accounts

 

Disclosure Schedule (3.19) lists all banks and other financial
institutions at which each Credit Party maintains deposit or other accounts as
of the Closing Date, including any Disbursement Accounts, and such Schedule correctly
identifies the name, address and telephone number of each depository, the name
in which the account is held, a description of the purpose of the account, and
the complete account number therefor.

 

3.20                           Government Contracts

 

Except as set forth in Disclosure Schedule (3.20), as of the
Closing Date, no Credit Party is a party to any contract or agreement with any
Governmental Authority the value of which exceeds $100,000 and no Credit Party’s
Accounts are subject to the Federal Assignment of Claims Act, as amended (31
U.S.C. Section 3727) or any similar foreign, state or local law.

 

3.21                           Customer and Trade Relations

 

As of the Closing Date, there exists no actual or, to the knowledge of
any Credit Party, threatened termination or cancellation of, or any material
adverse modification or change in: (a) the business relationship of any
Credit Party with any customer or group of customers whose purchases during the
preceding twelve (12) months caused it or them, as applicable, to be ranked
among the ten largest customers of such Credit Party, considered as a whole; or
(b) the business relationship of any Credit Party with any supplier or
group of suppliers whose sales during the preceding twelve (12) months caused
it or them, as applicable, to be ranked among the ten largest suppliers of such
Credit Party.

 

3.22                           Agreements and Other Documents

 

As of the Closing Date, each Credit Party has provided to Agent or its
counsel, on behalf of Lenders, accurate and complete copies (or summaries) of
all of the following agreements or documents to which it is subject and each of
which is listed in Disclosure Schedule (3.22): (a) supply agreements
and purchase agreements not terminable by such Credit Party within sixty (60)
days following written notice issued by such Credit Party and involving
transactions in excess of $1,000,000 per annum; (b) leases by such Credit
Party as lessee of Equipment Inventory having a remaining term of one year or
longer, the total value of leases of Equipment

 

 

Inventory as to which a Credit Party is lessee, for each lessor, the
annual payments on all such leases of Equipment Inventory and the Operating
Lease Pay-Off Value for each operating lease of Equipment Inventory of a
Borrower or a Guarantor; (c) licenses and permits held by such Credit
Party, the absence of which could be reasonably likely to have a Material
Adverse Effect; (d) instruments and documents evidencing any Indebtedness
or Guaranteed Indebtedness of such Credit Party and any Lien (other than
Permitted Encumbrances) granted by such Credit Party with respect thereto; and (e) instruments
and agreements evidencing the issuance of any equity securities, warrants,
rights or options to purchase equity securities of such Credit Party. With
respect to the leases referred to in clause (b) above, other than as set
forth on Disclosure Schedule (3.22), no Credit Party has any obligation in
such lease or otherwise to purchase such Equipment Inventory from the lessor of
such Equipment Inventory at any time. Each Borrower has provided to Agent the
forms of lease under which such Borrower leases Equipment Inventory to third
Persons.

 

3.23                           Solvency

 

Both before and after giving effect to (a) the Loans and Letter of
Credit Obligations to be made or incurred on the Closing Date or such other date
as Loans and Letter of Credit Obligations requested hereunder are made or
incurred, (b) the disbursement of the proceeds of such Loans pursuant to
the instructions of Borrowers, (c) the Mergers and the consummation of the
other Related Transactions and (d) the payment and accrual of all
transaction costs in connection with the foregoing, each Credit Party is and
will be Solvent.

 

3.24                           Contribution Agreement and Plan of
Reorganization

 

As of the Closing Date, Borrowers have delivered to Agent a complete and
correct copy of the Contribution Agreement and Plan of Reorganization
(including all schedules, exhibits, amendments, supplements, modifications,
assignments and all other documents delivered pursuant thereto or in connection
therewith). No Credit Party and no other Person party thereto is in default in
the performance or compliance with any provisions thereof. The Contribution
Agreement and Plan of Reorganization complies with, and the Mergers have been
consummated in accordance with, all applicable laws. The Contribution Agreement
and Plan of Reorganization is in full force and effect as of the Closing Date
and has not been terminated, rescinded or withdrawn. All requisite approvals by
Governmental Authorities having jurisdiction over any Credit Party and other
Persons referenced therein with respect to the transactions contemplated by the
Contribution Agreement and Plan of Reorganization have been obtained, and no
such approvals impose any conditions to the consummation of the transactions
contemplated by the Contribution Agreement and Plan of Reorganization or to the
conduct by any Credit Party of its business thereafter. To the best of each
Credit Party’s knowledge, none of the representations or warranties in the
Contribution Agreement and Plan of Reorganization contain any untrue statement
of a material fact or omit any fact necessary to make the statements therein
not misleading.

 

 

3.25                           Status of Holdings

 

Prior to the Closing Date, H&E Holdings, H&E
Finance, Gulf Wide and GNE Investments will not have engaged in any business or
incurred any Indebtedness or any other liabilities (except in connection with
its corporate formation, the Related Transactions Documents and this
Agreement).

 

3.26                           Senior Debt

 

As of the Closing Date, Borrowers have delivered to
Agent a complete and correct copy of the Senior Notes, the Senior Note
Indenture, the Senior Subordinated Notes and the Senior Subordinated Note
Indenture and all agreements and instruments executed and delivered in
connection therewith (including all schedules, exhibits, amendments,
supplements, modifications, assignments and all other documents delivered
pursuant thereto or in connection therewith). Borrowers have the limited
liability company power and authority to incur the Indebtedness evidenced by
the Senior Notes and the Senior Subordinated Notes. The subordination
provisions of the Senior Subordinated Note Indenture are enforceable against
the Trustee under the Senior Subordinated Note Indenture and the holders of the
Senior Subordinated Notes by Agent and Lenders. The terms of the Intercreditor
Agreement are enforceable against the trustee for the Senior Notes and the
holders of the Senior Notes.

 

4.              FINANCIAL STATEMENTS AND
INFORMATION

 

4.1                                 Reports and Notices

 

(a)                                  Each Credit Party hereby agrees that from and
after the Closing Date and until the Termination Date, it shall deliver to
Agent or to Agent and Lenders, as required, the Financial Statements, notices,
Projections and other information at the times, to the Persons and in the
manner set forth in Annex E.

 

(b)                                 Each Credit Party hereby agrees that from and
after the Closing Date and until the Termination Date, it shall deliver to
Agent or to Agent and Lenders, as required, the various Collateral Reports
(including Borrowing Base Certificates in the form of Exhibit 4. 1(b)) at
the times, to the Persons and in the manner set forth in Annex F.

 

4.2                                 Communication with Accountants

 

Each Credit Party authorizes (a) Agent and (b) so long as an
Event of Default has occurred and is continuing, each Lender, to communicate
directly with its independent certified public accountants including Arthur
Andersen, KPMG Peat Marwick LLP and Hawthorne Weymouth, and authorizes and, at
Agent’s request, shall instruct those accountants and advisors to disclose and
make available to Agent and each Lender any and all Financial Statements and
other supporting financial documents, schedules and information relating to any
Credit Party (including copies of any issued management letters) with respect
to the business, financial condition and other affairs of any Credit Party.

 

 

5.              AFFIRMATIVE COVENANTS

 

Each Credit Party jointly and severally agrees as to
all Credit Parties that from and after the date hereof and until the
Termination Date:

 

5.1                            Maintenance of Existence and Conduct of
Business

 

Each Credit Party shall: (a) do or cause to be
done all things necessary to preserve and keep in full force and effect its
existence as a limited liability company or a corporation, as the case may be,
and its rights and franchises; (b) continue to conduct its business
substantially as now conducted or as otherwise
permitted hereunder; (c) at all times maintain, preserve and protect all
of its assets and properties used or useful in the conduct of its business, and
keep the same in good repair, working order and condition in all material
respects (taking into consideration ordinary wear and tear) and from time to
time make, or cause to be made, all necessary or appropriate repairs,
replacements and improvements thereto consistent with industry practices; and (d) transact
business only in such limited liability company, corporate and trade names as
are set forth in Disclosure Schedule (5.1).

 

5.2                            Payment of Charges

 

(a)                               Subject to Section 5.2(b), each Credit
Party shall pay and discharge or cause to be paid and discharged promptly all
Charges payable by it, including (i) Charges imposed upon it, its income
and profits, or any of its property (real, personal or mixed) and all Charges with
respect to tax, social security and unemployment withholding with respect to
its employees, and (ii) lawful claims for labor, materials, supplies and
services or otherwise, and (iii) all storage or rental charges payable to
warehousemen or bailees, in each case, before any thereof shall become past
due.

 

(b)                              Each Credit Party may in good faith contest,
by appropriate proceedings, the validity or amount of any Charges, Taxes or
claims described in Section 5.2(a); provided,
that (i) adequate reserves with respect to such contest are
maintained on the books of such Credit Party, in accordance with GAAP; (ii) no
Lien shall be imposed to secure payment of such Charges (other than payments to
warehousemen and/or bailees and Permitted Encumbrances) that is superior to any
of the Liens securing the Obligations and such contest is maintained and
prosecuted continuously and with diligence and operates to suspend collection
or enforcement of such Charges; (iii) none of the Collateral becomes subject
to forfeiture or loss as a result of such contest; (iv) such Credit Party
shall promptly pay or discharge such contested Charges, Taxes or claims and all
additional charges, interest, penalties and expenses, if any, and shall deliver
to Agent evidence reasonably acceptable to Agent of such compliance, payment or
discharge, if such contest is terminated or discontinued adversely to such
Credit Party or the conditions set forth in this Section 5.2(b) are
no longer met, and (v) Agent has not advised such Credit Party in writing
that Agent reasonably believes that nonpayment or nondischarge thereof could
have or result in a Material Adverse Effect.

 

 

5.3                                 Books and Records

 

Each Credit Party shall keep adequate books and records with respect to
its business activities in which proper entries, reflecting all financial
transactions, are made in accordance with GAAP and on a basis consistent with
the Financial Statements attached as Disclosure Schedule (3.4(a)).

 

5.4                                 Insurance; Damage to or Destruction of
Collateral

 

(a)                                  Each Credit Party shall at its sole cost and
expense, maintain the policies of insurance described in Disclosure Schedule (3.18)
as in effect on the date hereof, and each Person succeeding to the position of
such individual, or otherwise in form and amounts and with insurers reasonably
acceptable to Agent. Such policies of insurance (or the loss payable and
additional insured endorsements delivered to Agent) shall contain provisions pursuant
to which the insurer agrees to provide 30 days prior written notice to Agent in
the event of any non-renewal, cancellation or amendment of any such insurance
policy. If any Credit Party at any time or times hereafter shall fail to obtain
or maintain any of the policies of insurance required above or to pay all
premiums relating thereto, Agent may at any time or times thereafter obtain and
maintain such policies of insurance and pay such premiums and take any other
action with respect thereto that Agent deems advisable. Agent shall have no
obligation to obtain insurance for any Credit Party or pay any premiums
therefor. By doing so, Agent shall not be deemed to have waived any Default or
Event of Default arising from any Credit Party’s failure to maintain such insurance
or pay any premiums therefor. All sums so disbursed, including reasonable attorneys’
fees, court costs and other charges related thereto, shall be payable on demand
by Borrowers to Agent and shall be additional Obligations hereunder secured by
the Collateral.

 

(b)                                 Agent reserves the right at any time upon any
change in any Credit Party’s risk profile (including any change in the product
mix maintained by any Credit Party or any laws affecting the potential
liability of such Credit Party) to require additional forms and limits of
insurance to, in Agent’s opinion, adequately protect both Agent’s and Lender’s
interests in all or any portion of the Collateral and to ensure that each
Credit Party is protected by insurance in amounts and with coverage customary
for its industry.- If reasonably requested by Agent, each Credit Party shall
deliver to Agent from time to time a report of a reputable insurance broker,
reasonably satisfactory to Agent, with respect to its insurance policies.

 

(c)                                  Each Credit Party shall deliver to Agent, in
form and substance reasonably satisfactory to Agent, endorsements to (i) all
“All Risk,” keyman life insurance and business interruption insurance naming
Agent, on behalf of itself and Lenders, as loss payee, and (ii) all
general liability and other liability policies naming Agent, on behalf of
itself and Lenders, as additional insured. Each Credit Party irrevocably makes,
constitutes and appoints Agent (and all officers, employees or agents
designated by Agent), so long as any Event of Default has occurred and is
continuing or the anticipated insurance proceeds exceed

 

 

$5,000,000, as such Credit Party’s true and lawful agent and
attorney-in-fact for the purpose of making, settling and adjusting claims under
such “All Risk” policies of insurance, endorsing the name of such Credit Party
on any check or other item of payment for the proceeds of such “All Risk”
policies of insurance and for making all determinations and decisions with
respect to such “All Risk” policies of insurance. Agent shall have no duty to
exercise any rights or powers granted to it pursuant to the foregoing
power-of-attorney. Borrower Representative shall promptly notify Agent of any
loss, damage, or destruction to the Collateral in the amount of $1,000,000 or
more, whether or not covered by insurance. After deducting from such proceeds
the expenses, if any, incurred by Agent in the collection or handling thereof,
Agent may, at its option, apply such proceeds to the reduction of the
Obligations in accordance with Section 1.3(d), or permit or require the
applicable Credit Party to use such money, or any part thereof, to replace, repair,
restore or rebuild the Collateral in a diligent and expeditious manner with
materials and workmanship of substantially the same quality as existed before
the loss, damage or destruction. Notwithstanding the foregoing, if the casualty
giving rise to such insurance proceeds could not reasonably be expected to have
a Material Adverse Effect and such insurance proceeds do not exceed $5,000,000
in the aggregate, Agent shall permit the applicable Credit Party to replace,
restore, repair or rebuild the Collateral; provided,
that if the applicable Credit Party has not completed or entered
into binding agreements to complete such replacement, restoration, repair or
rebuilding within 180 days of such casualty, Agent may apply such insurance
proceeds to the Obligations in accordance with Section 1.3(d). All
insurance proceeds that are to be made available to a Credit Party to replace,
repair, restore or rebuild the Collateral shall be applied by Agent to reduce
the outstanding principal balance of the Revolving Loan (which application
shall not result in a permanent reduction of the Revolving Loan Commitment) and
upon such application, Agent shall establish a reserve against the Aggregate
Borrowing Base and, if such Credit Party is a Borrower, the separate Borrowing
Base of such Borrower in an amount equal to the amount of such proceeds so
applied. Thereafter, such funds shall be made available to the applicable
Credit Party to provide funds to replace, repair, restore or rebuild the
Collateral as follows: (i) the Borrower Representative shall request a
Revolving Credit Advance for the applicable Borrower (or, if the Credit Party
is not a Borrower, for all Borrowers, pro
rata) in the amount requested to be released; (ii) so long
as the conditions set forth in Section 2.2 have been met, Revolving
Lenders shall make such Revolving Credit Advance; and (iii) the reserve
established with respect to such insurance proceeds shall be reduced by the
amount of such Revolving Credit Advance. To the extent not used to replace, repair,
restore or rebuild the Collateral, such insurance proceeds shall be applied in
accordance with Section 1.3(d).

 

(d)                                 Borrower Representative shall, immediately
upon learning of the institution of any proceeding for the condemnation or
other taking of any property of any Credit Party in excess of $1,000,000 in the
aggregate for all such condemnations or takings, notify the Agent of the
pendency of such proceeding, and agree that the Agent may participate in any
such proceeding, and Borrower Representative from time to time will deliver to
the

 

 

Agent all instruments reasonably requested by the
Agent to permit such participation. The Agent is authorized to collect the
proceeds of any condemnation claim or award and apply them, at the direction of
the Required Lenders, to the reduction of the Obligations. Notwithstanding the
foregoing, if the proceeds of such condemnation could not reasonably be
expected to have a Material Adverse Effect and the amount of any condemnation
does not exceed $5,000,000 in the aggregate, Agent shall permit the applicable
Credit Party to replace, restore, repair or rebuild the property; provided, that if the applicable Credit
Party has not completed or entered into binding agreements to complete such
replacement, restoration, repair or rebuilding within 180 days of such
condemnation, Agent may apply such condemnation proceeds to the Obligations in
accordance with Section 1.3(d). All condemnation proceeds that are to be
made available to a Credit Party to replace, repair, restore or rebuild the
Collateral shall be applied by Agent to reduce the outstanding principal
balance of the Revolving Loan (which application shall not result in a
permanent reduction of the Revolving Loan Commitment) and upon such
application, Agent shall establish a reserve against the Aggregate Borrowing
Base and, if such Credit Party is a Borrower, the separate Borrowing Base of
such Borrower in an amount equal to the amount of such proceeds so applied.
Thereafter, such funds shall be made available to the applicable Credit Party
to provide funds to replace, repair, restore or rebuild the Collateral as
follows: (i) the Borrower Representative shall request a Revolving Credit
Advance for the applicable Borrower (or, if the Credit Party is not a Borrower,
for all Borrowers, pro rata) in the amount requested to be released; (ii) so
long as the conditions set forth in Section 2.2 have been met, Revolving
Lenders shall make such Revolving Credit Advance; and (iii) the reserve
established with respect to such condemnation proceeds shall be reduced by the
amount of such Revolving Credit Advance. To the extent not used to replace,
repair, restore or rebuild the Collateral, such condemnation proceeds shall be
applied in accordance with Section 1.3(d).

 

5.5                                 Compliance with Laws

 

Each Credit Party shall comply with all federal, state, local and
foreign laws and regulations applicable to it, including those relating to
licensing, ERISA and labor matters and Environmental Laws and Environmental
Permits, except to the extent that the failure to comply, individually or in
the aggregate, could not reasonably be expected to have a Material Adverse
Effect.

 

5.6                                 Supplemental Disclosure

 

From time to time as may be reasonably requested by Agent (which
request will not be made more frequently than once each year absent the
occurrence and continuance of a Default or an Event of Default), Credit Parties
shall supplement each Disclosure Schedule hereto, or any representation
herein or in any other Loan Document, with respect to any matter hereafter
arising that, if existing or occurring at the date of this Agreement, would
have been required to be set forth or described in such Disclosure Schedule or
as an exception to such representation or that is necessary to correct any
information in such Disclosure Schedule or representation which has

 

 

been rendered inaccurate thereby (and, in the case of any supplements
to any Disclosure Schedule, such Disclosure Schedule shall be
appropriately marked to show the changes made therein); provided, that (a) no such supplement
to any such Disclosure Schedule or representation shall amend, supplement
or otherwise modify any Disclosure Schedule or representation, or be or be
deemed a waiver of any Default or Event of Default resulting from the matters
disclosed therein, except as consented to by Agent and Requisite Lenders in
writing; and (b) no supplement shall be required or permitted as to
representations and warranties that relate solely to the Closing Date.

 

5.7                                 Intellectual Property

 

Each Credit Party will conduct its business and affairs without
material infringement of or material interference with any Intellectual
Property of any other Person; provided, that
to the extent any Credit Party learns of any such material infringement or
interference and such Credit Party promptly takes steps to eliminate such
infringement or interference (by procuring a license or otherwise) such Credit
Party shall not be deemed to be in violation of this Section 5.7 so long
as such Credit Party is entitled to continue to use such Intellectual Property.

 

5.8                                 Environmental Matters

 

Each Credit Party shall and shall cause each Person within its
reasonable control to: (a) conduct its operations and keep and maintain
its Real Estate in compliance with all Environmental Laws and Environmental
Permits other than noncompliance that could not reasonably be expected to have
a Material Adverse Effect; (b) implement any and all investigation,
remediation, removal and response actions that are appropriate or necessary to
maintain the value and marketability of the Real Estate or to otherwise comply
with Environmental Laws and Environmental Permits pertaining to the presence,
generation, treatment, storage, use, disposal, transportation or Release of any
Hazardous Material on, at, in, under, above, to, from or about any of its Real
Estate; (c) notify Agent promptly after such Credit Party becomes aware of
any violation of Environmental Laws or Environmental Permits or any Release on,
at, in, under, above, to, from or about any Real Estate which could reasonably
be expected to result in Environmental Liabilities in excess of $250,000; and (d) promptly
forward to Agent a copy of any order, notice, request for information or any
written communication or-report received by such Credit Party in connection
with any such violation or Release or any other matter relating to any
Environmental Laws or Environmental Permits that could reasonably be expected
to result in Environmental Liabilities in excess of $250,000, in each case
whether or not the Environmental Protection Agency or any Governmental
Authority has taken or threatened any action in connection with any such
violation, Release or other matter. If Agent at any time has a reasonable basis
to believe that there may be a violation of any Environmental Laws or
Environmental Permits by any Credit Party or any Environmental Liability
arising thereunder, or a Release of Hazardous Materials on, at, in, under,
above; to, from or about any of its Real Estate, which, in each case, could
reasonably be expected to have a Material Adverse Effect, then Credit Parties
shall, upon Agent’s written request (i) cause the performance of an
environmental audit, which may include subsurface sampling of soil and
groundwater, and preparation of an environmental report with respect to the

 

 

subject matter of such breach, at Credit Parties’
expense, as Agent may from time to time reasonably request, which shall be
conducted by reputable environmental consulting firms reasonably acceptable to
Agent and shall be in form and substance reasonably acceptable to Agent, and (ii) permit
Agent or its representatives to have access to all Real Estate for the purpose
of conducting environmental audits and testing with respect to the subject
matter of such breach, as Agent deems appropriate, including
subsurface sampling of soil and groundwater, provided,
that Agent provides Borrower Representative with reasonable prior
notice and conducts, or causes its representatives to conduct, all such audits
and tests in a manner reasonably directed to minimize interference with the
applicable Credit Party’s business. Borrowers shall reimburse Agent for the
reasonable costs of such audits and tests and the same will constitute a part
of the Obligations secured hereunder.

 

5.9                                 Landlords’ Agreements, Mortgagee Agreements,
Bailee Letters, Real Estate Purchases and Vendor Inter-Creditor Agreements

 

(a)                                  Each Credit Party shall use its commercially
reasonable best efforts to obtain a landlord’s agreement, mortgagee agreement
or bailee letter, as applicable, from the lessor of each leased property,
mortgagee of owned property or bailee with respect to any warehouse, processor
or converter facility or other location where Collateral is stored or located
(other than with respect to Equipment Inventory which is being leased by a
Borrower to others in the ordinary course of such Borrower’s business), which
agreement or letter shall contain a waiver or subordination of all Liens or
claims that the landlord, mortgagee or bailee may assert against the Collateral
at that location, and shall otherwise be reasonably satisfactory in form and
substance to Agent. With respect to such locations or warehouse space leased or
owned as of the Closing Date and thereafter, if Agent has not received a
landlord or mortgagee agreement or bailee letter as of 30 days after the
Closing Date (or, if later, as of the date such location is acquired or
leased), the applicable Borrower’s Eligible Parts and Tools Inventory, Eligible
Rolling Stock or Eligible Equipment Inventory at that location shall, in Agent’s
discretion, be excluded from the applicable Borrower’s Borrowing Base or be
subject to such Reserves as may be established in good faith by Agent in its
reasonable credit judgment and as set forth in Sections 1.6A, 1.7 and 1.7A.
After the Closing Date, no real property or warehouse space shall be leased by
any Borrower and no Parts and Tools Inventory or Equipment Inventory shall be
shipped to a processor or converter under arrangements established after the
Closing Date without prior written notice to Agent Each Credit Party shall
timely and fully pay and perform its obligations in all material respects under
all leases and other agreements with respect to each leased location or public
warehouse where any Collateral is or may be located. To the extent otherwise
permitted hereunder, if any Credit Party proposes to acquire a fee ownership or
leasehold interest in Real Estate after the Closing Date, it shall first
provide to Agent (with respect to any such leasehold interest, at the
reasonable request of Agent) written notice thereof and a mortgage or deed of
trust granting Agent a first priority Lien on such Real Estate, together with a
FIRREA compliant appraisal (if requested by Agent), environmental audits,
mortgage title

 

 

insurance commitment, real property survey, local counsel opinions,
and, if required by Agent, supplemental casualty insurance and flood insurance,
and such other documents, instruments or agreements reasonably requested by
Agent, in each case, in form and substance reasonably satisfactory to Agent.

 

(b)                                 At the request of Agent, Borrowers shall
execute and deliver or cause to be executed and delivered to Agent a mortgage
or deed of trust granting to Agent a first priority Lien on any Real Estate
owned by any Borrower or Guarantor (or, if such Real Estate is subject to any
prior Liens as of the Closing Date, a Lien subject only to such prior Liens),
together with a FIRREA compliant appraisal, environmental audit, mortgage title
insurance commitment, real property survey, local counsel opinion, and if
required by Agent, supplemental casualty insurance, and such other documents,
instruments or agreements reasonably requested by Agent, in each case, in form
and substance satisfactory to Agent. Borrowers shall execute and deliver or
cause to be executed and delivered in respect of the Real Estate described on
Disclosure Schedule (5.9) hereto on or prior to the date sixty (60) days
following the Closing Date, documents of the type listed in the immediately foregoing
sentence, as described in such Disclosure Schedule (5.9) or as requested
by Agent.

 

(c)                                  Prior to entering into any financing
arrangement described in Section 6.7(c) or Section 6.7(d) a
Borrower shall notify Agent. In the event that a Borrower obtains knowledge of the
assignment by any holder of any such Lien referred to in Section 6.7(c) or
Section 6.7(d), or the owner of any equipment leased by a Borrower has
transferred or sold such Lien or Equipment to another Person, such Borrower
shall notify Agent and use reasonable efforts to cause such Person to enter
into an applicable Vendor Inter-Creditor Agreement with such Person.

 

5.10                           Government Accounts

 

Each Borrower shall at any time upon reasonable request by the Agent
prepare and deliver to the Agent a report setting forth all of its Accounts on
which the Account Debtor is the United States or Canadian Government or a
political subdivision thereof, or any state, province or municipality or
department, agency or instrumentality thereof, which such report shall disclose
the name of the Account Debtor, the amount of such Account and any other
information the Agent shall reasonably request.

 

5.11                           Further Assurances

 

Each Credit Party agrees that it shall, and shall cause each other
Credit Party to, at such Credit Party’s expense and upon request of Agent, duly
execute and deliver, or cause to be duly executed and delivered, to Agent such
further instruments and do and cause to be done such further acts as may be
necessary or proper in the reasonable opinion of Agent to carry out more
effectively the provisions and purposes of this Agreement or any other Loan
Document. All chattel paper owned

 

 

by any Credit Party shall be conspicuously legended to indicate that it
is subject to a Lien in favor of the Agent.

 

6.              NEGATIVE COVENANTS

 

Each Credit Party agrees jointly and severally as to all parties that
from and after the date hereof until the Termination Date:

 

6.1                                 Acquisitions, Subsidiaries, Etc.

 

No Credit Party shall directly or indirectly, by operation of law or
otherwise, (a) form or acquire any Subsidiary, or (b) merge with,
consolidate with, acquire all or substantially all of the assets or Stock of,
or otherwise combine with or acquire, any Person; provided, that any Credit Party may merge with another
Credit Party, so long as (i) that Borrower Representative shall be the
survivor of any such merger to which it is a party and (ii) a Borrower
shall be the survivor of any such merger to which one or more Borrowers is a
party. Notwithstanding the foregoing, any Borrower may acquire all or any
substantial portion of the assets (other than assets consisting of Stock) of
any Person (the “Target”) (a “Permitted Acquisition”)
subject to the satisfaction of each of the following conditions:

 

(i)                                     Agent shall receive at least forty-five (45)
days prior written notice of such proposed Permitted Acquisition, which notice
shall include a detailed description of such proposed Permitted Acquisition
including, without limitation, financial statements of Target and any other due
diligence items requested by Lenders;

 

(ii)                                  such Permitted Acquisition shall only involve
assets 75% or more of which are located in the United States and comprising a
business, or those assets of a business, of the type engaged in by Borrowers as
of the Closing Date or a business reasonably related thereto or a logical
extension thereof, and which business would not subject Agent or any Lender to
regulatory or third party approvals in connection with the exercise of its
rights and remedies under this Agreement or any other Loan Documents other than
approvals applicable to the exercise of such rights and remedies with respect
to Borrowers prior to such Permitted Acquisition;

 

(iii)                               no additional Indebtedness or Guaranteed
Indebtedness, contingent obligations or other liabilities shall be incurred,
assumed or otherwise be reflected on a consolidated balance sheet of Borrowers
and Target after giving effect to such Permitted Acquisition, except (A) Indebtedness
permitted under clause (v) and (B) ordinary course trade payables,
accrued expenses and unsecured Indebtedness and other liabilities and
contingent obligations of the Target to the extent no Default or Event of
Default has occurred and is continuing or would result after giving effect to
such Permitted Acquisition;

 

 

(iv)                              the sum of all amounts paid or payable in
connection with all Permitted Acquisitions (including all transaction costs and
all Indebtedness, liabilities and contingent obligations incurred or assumed in
connection therewith or otherwise reflected on a consolidated balance sheet of
Borrowers and Target) shall not exceed $25,000,000 in any Fiscal Year or
$75,000,000 from and after the Closing Date until the Termination Date in the
aggregate and the portion thereof allocable to goodwill and intangible assets
for any Permitted Acquisition shall not exceed 30% of the applicable purchase
price for such Permitted Acquisition;

 

(v)                                 no Indebtedness for borrowed money to finance
such acquisitions shall be incurred, guaranteed, assumed or consolidated in
connection with such Permitted Acquisitions other than Revolving Credit
Advances subject to the terms hereof and including any assets being purchased
in the Permitted Acquisition to the extent otherwise includable in the
Aggregate Borrowing Base;

 

(vi)                              the business and assets acquired in such
Permitted Acquisition shall be free and clear of all Liens (other than
Permitted Encumbrances);

 

(vii)                           at or prior to the closing of any Permitted
Acquisition, Agent will be granted a first priority perfected Lien (subject to
Permitted Encumbrances) in all assets acquired pursuant thereto, and Credit
Parties and the Target shall have executed such documents and taken such
actions as may be required by Agent in connection therewith;

 

(viii)                        Concurrently with delivery of the notice
referred to in clause (i) above, Borrower Representative shall have
delivered to Agent, in form and substance satisfactory to Agent:

 

(A)                              (x)                                   a pro
forma consolidated and consolidating, if applicable, balance sheet
of Borrowers and their Subsidiaries (the “Acquisition Pro Forma”),
based on recent financial data, which shall be complete and shall accurately
and fairly represent the assets, liabilities, financial condition and results
of operations of Borrowers and their Subsidiaries in accordance with GAAP
consistently applied, but taking into account such Permitted Acquisition and
the funding of all Loans in connection therewith, and such Acquisition Pro
Forma shall reflect that

 

(y)                                 on a pro
forma basis, no Event of Default has occurred and is continuing or
would result after giving effect to such Permitted Acquisition and Borrowers
would have been in compliance with the financial covenants set forth in Annex G
for the four quarter period reflected in the Compliance Certificate most
recently delivered, to Agent pursuant to Annex E prior to the consummation of
such Permitted Acquisition (after giving effect to such Permitted Acquisition
and all 

 

 

Loans funded in connection therewith as if made on the first day of
such period);

 

(B)                                updated versions of the most recently
delivered operating plan in form reasonably satisfactory to the Agent taking
into account such Permitted Acquisition (the “Acquisition
Projections”); and

 

(C)                                a certificate of an Authorized Officer of
Borrower Representative to the effect that: (w) Borrowers will be Solvent upon
the consummation of the Permitted Acquisition; (x) the Acquisition Pro Forma
fairly presents the financial condition of Borrowers and their Subsidiaries (on
a consolidated and consolidating basis, if applicable) as of the date thereof after
giving effect to the Permitted Acquisition; (y) the Acquisition Projections are
reasonable estimates of the future financial performance of Borrowers
subsequent to the date thereof based upon the historical performance of
Borrowers and the Target and show that Borrowers shall continue to be in
compliance with the financial covenants set forth in Annex G for the three (3) year
period thereafter or the balance remaining of the Commitment term; and (z)
Borrowers have completed their due diligence investigation with respect to the
Target and such Permitted Acquisition, which investigation was conducted in a
manner similar to that which would have been conducted by a prudent purchaser
of a comparable business and the results of which investigation were delivered
to Agent and Lenders;

 

(ix)                                on or prior to the date of such Permitted
Acquisition, Agent shall have received, in form and substance reasonably
satisfactory to Agent, copies of the acquisition agreement and related agreements
and instruments, and all opinions, certificates, lien search results and other
documents reasonably requested by Agent;

 

(x)                                   Agent and Lenders shall have received results
of an appraisal and audit of the Target, its assets, and its books and records,
in form and substance reasonably satisfactory to the Agent;

 

(xi)                                the structure and terms of the Permitted
Acquisition shall be satisfactory to the Agent and no Credit Party shall
acquire any liabilities in such transaction other than those approved by the
Agent;

 

(xii)                             at the time of such Permitted Acquisition and
after giving effect thereto, no Default or Event of Default shall have occurred
and be continuing; and

 

(xiii)                          at the time of such Permitted Acquisition and
after giving effect thereto and the making of any Loans in connection
therewith, Borrowing Availability (for all Borrowers) shall exceed $25,000,000.

 

6.2                                 Investments;
Loans and Advances

 

Except as otherwise
expressly permitted by this Section 6, no Credit Party shall make or
permit to exist any investment in, or make, accrue or permit to exist loans or
advances of money to, any Person, through the direct or indirect lending of
money, holding of securities or otherwise, except that (a) a Borrower may
hold investments comprised of notes payable, or stock or other securities
issued by Account Debtors to such Borrower pursuant to a bankruptcy proceeding
of such Account Debtor or negotiated agreements with respect to settlement of
such Account Debtor’s Accounts, as applicable, in the ordinary course of
business, so long as the aggregate amount of such Accounts so settled by
Borrowers does not exceed $1,000,000; (b) a Borrower may acquire
Intercompany Notes permitted to be incurred under Section 6.3, (c) a
Borrower may invest in Capital Expenditures to the extent permitted under Annex
G, (d) a Credit Party may hold investments received pursuant to a sale of
assets permitted under Section 6.8, (e) a Credit Party may hold
investments held in the ordinary course of business in any Deposit Account
subject to a Lien in favor of Agent, (f) a Credit Party may hold
investments in existence on the date hereof and summarized in Disclosure Schedule (6.2), and (g) so long as no Default or
Event of Default has occurred and is continuing, Borrowers may make
investments, subject to Control Letters or otherwise subject to a perfected
security interest in favor of Agent for the benefit of Lenders, in (i) marketable
direct obligations issued, unconditionally guaranteed or insured by the United
States of America or any agency thereof maturing within one year from the date
of acquisition thereof, (ii) commercial paper maturing no more than one
year from the date of creation thereof and currently having the highest rating
obtainable from either Standard & Poor’s Ratings Group or Moody’s
Investors Service, Inc., (iii) certificates of deposit, maturing no
more than one year from the date of creation thereof, issued by commercial
banks incorporated under the laws of the United States of America, each having
combined capital, surplus and undivided profits of not less than $300,000,000
and having a senior secured rating of “A” or better by a nationally recognized
rating agency (an “A Rated Bank”), (iv) time
deposits, maturing no more than 30 days from the date of creation thereof with
A Rated Banks, (v) mutual funds that invest solely in one or more of the
investments described in clauses (i) through (iv) above and (vi) other
investments not exceeding $100,000 in aggregate amount in which Agent has a
perfected first priority security interest.  Each Credit Party may maintain its existing
investments in its Subsidiaries as of the Closing Date.

 

6.3                                 Indebtedness

 

(a)                                  No Credit Party shall create, incur, assume
or permit to exist any Indebtedness, except (without duplication) (i) Indebtedness
secured by purchase money security interests and Capital Leases permitted in
clause (c) or (d) of Section 6.7, (ii) the Loans and the
other Obligations, (iii) deferred taxes, to the extent permitted under
applicable law, (iv) unfunded pension fund and other employee benefit plan
obligations and liabilities to the extent they are permitted to remain unfunded
under applicable law, (v) existing Indebtedness described in Disclosure Schedule (6.3)
and refinancings thereof or amendments or modifications thereto that do not
have the effect of increasing the

 

 

principal amount thereof or changing the amortization thereof (other
than to extend the same) and that are otherwise on terms and conditions no less
favorable to any Credit Party than the terms of the Indebtedness
being refinanced, amended or modified, (vi) Indebtedness specifically
permitted under Section 6.1, (vii) Indebtedness of Borrowers not
exceeding (x) $200,000,000 in aggregate principal amount (less all payments of
principal thereof) evidenced by the Senior Notes and (y) $50,000,000 in
aggregate principal amount (less all payments of principal thereof) evidenced
by the Senior Subordinated Notes and (viii) Indebtedness consisting of
intercompany loans and advances made by any Borrower to any other Borrower; provided, that: (A) each Borrower
shall have executed and delivered to each other Borrower, on the Closing Date,
a demand note (collectively, the “Intercompany Notes”)
to evidence any such intercompany Indebtedness owing at any time by such
Borrower to such other Borrowers which Intercompany Notes shall be in form and
substance reasonably satisfactory to Agent and shall be pledged and delivered
to Agent pursuant to the applicable Pledge Agreement or Security Agreement as
additional collateral security for the Obligations; (B) each Borrower
shall record all intercompany transactions on its books and records in a manner
reasonably satisfactory to Agent; (C) the obligations of each Borrower
under any such Intercompany Notes shall be subordinated to the Obligations of
such Borrower hereunder in a manner reasonably satisfactory to Agent; (D) at
the time any such intercompany loan or advance is made by any Borrower to any
other Borrower and after giving effect thereto, each such Borrower shall be
Solvent; (E) no Default or Event of Default would occur and be continuing
after giving effect to any such proposed intercompany loan; and (F) in the
case of any intercompany Indebtedness, (X) the Borrower advancing such funds
shall have Borrowing Availability under its separate Borrowing Base of not less
than $1,00 after giving effect to such intercompany loan, or (Y) the intercompany
Indebtedness shall be a Great Northern Advance, (ix) Indebtedness owing to
Affiliates and holders of Stock of such Credit Party that constitutes
Subordinated Debt, is unsecured, interest on which is not payable in cash until
after the Termination Date and as to which no principal is payable until after
the Termination Date, (x) Indebtedness under Hedging Agreements to the extent
permitted under Section 6.17 and (xi) unsecured Indebtedness not otherwise
referred to in this Section 6.3 not exceeding $1,000,000 in aggregate
principal amount outstanding at any time for all Credit Parties.

 

(b)                                 No Credit Party shall, directly or
indirectly, voluntarily purchase, redeem, defease or prepay any principal of,
premium, if any, interest or other amount payable in respect of any
Indebtedness, other than (i) the Obligations, (ii) Indebtedness secured
by a Permitted Encumbrance if the asset securing such Indebtedness has been
sold or otherwise disposed of in accordance with Sections 6.8(b) or (c) and
(iii) Indebtedness permitted by Section 6.3(a)(v) upon any refinancing
thereof in accordance with Section 6.3(a)(v).

 

 

6.4                                 Employee Loans and Affiliate Transactions

 

(a)                                  No Credit Party shall enter into or be a
party to any transaction with any Affiliate of any Credit Party (other than
another Credit Party) thereof except in the ordinary course of and pursuant to
the reasonable requirements of such Credit Party’s business and upon fair and reasonable
terms that are no less favorable to such Credit Party than would be obtained in
a comparable arm’s length transaction with a Person not an Affiliate of such
Credit Party; provided, that
other than a transaction described in any Related Transaction Documents or
Disclosure Schedule 6.4(a), no Credit Party shall in any event enter into
any such transaction or series of related transactions (i) involving
payments in excess of $10,000 without disclosing to Agent in advance the terms
of such transactions and (ii) involving payments in excess of $50,000 in
the aggregate; and provided further, that
Borrowers may pay the fees to BRS Management Co. disclosed in, and subject to
the terms of, Section 6.14.

 

(b)                                 All employee loans and affiliate transactions
existing as of the Closing Date hereof are described in Disclosure Schedule (6.4(b)).
 No Credit Party shall enter into any
lending or borrowing transaction with any employees of any Credit Party, except
loans to its respective employees in the ordinary course of business consistent
with past practices for travel and entertainment expenses, relocation costs and
similar purposes up to a maximum of $100,000 to any employee and up to a
maximum of $500,000 in the aggregate at any one time outstanding.  No Credit Party shall repurchase any Stock of
any employee of such Credit Party, except upon termination of such employee
consistent with past practices for such repurchase up to a maximum amount of
$1,000,000 in the aggregate for all employees of all Credit Parties in any one
Fiscal Year; provided, that at the
time of any such repurchase and after giving effect thereto the aggregate
Borrowing Availability for all Borrowers is in excess of $25,000,000.

 

6.5                                 Capital Structure and Business

 

No Credit Party shall (a) make any changes in any of its business
objectives, purposes or operations that could in any way adversely affect the
repayment of the Loans or any of the other Obligations or could reasonably be
expected to have or result in a Material Adverse Effect, (b) other than
with respect to H&E Holdings, make any change in its capital structure as described
in Disclosure Schedule (3.8), including the issuance or sale of any shares
of Stock, warrants or other securities convertible into Stock or any revision
of the terms of its outstanding Stock, provided,
that any Borrower may issue or sell shares of its Stock for cash so
long as (i) the proceeds thereof are applied in prepayment of the
Obligations as required by Section 1.3(b)(iii), (ii) no Change of
Control occurs after giving effect thereto and (iii) such shares are
pledged to the Agent for the benefit of the Lenders pursuant to a Pledge
Agreement, or (c) amend its charter, bylaws, certificate of formation or
operating agreement, each as applicable, in a manner that would adversely
affect Agent or Lenders or Credit Parry’s duty or ability to repay the
Obligations.  No Credit Party shall
engage in any business other than the businesses currently engaged in by it or
reasonably related thereto or a logical extension thereof.

 

 

6.6                                 Guaranteed Indebtedness

 

No Credit Party shall create, incur, assume or permit to exist any
Guaranteed Indebtedness except (a) for Guaranteed Indebtedness in
existence on the date hereof described in Disclosure Schedule (6.6), (b) for
Guaranteed Indebtedness incurred for the benefit of the purchasers of Equipment
Inventory to support sales by any Borrower or Guarantor of such Equipment
Inventory in the ordinary course of business to such purchasers, not to exceed
$2,000,000 at any one time outstanding for all Credit Parties, (c) by
endorsement of instruments or items of payment for deposit to the general
account of any Credit Party, and (d) for Guaranteed Indebtedness incurred
for the benefit of any other Credit Parry if the primary obligation is
expressly permitted by this Agreement other than Indebtedness, if any, of a
Target existing at the time such Target is acquired.

 

6.7                                 Liens

 

No Credit Party shall create, incur, assume or permit to exist any Lien
on or with respect to its Accounts or any of its other properties or assets
(whether now owned or hereafter acquired) except for (a) Permitted
Encumbrances; (b) Liens in existence on the date hereof and summarized in
Disclosure Schedule (6.7) securing the Indebtedness described in
Disclosure Schedule (6.3) (other than under the heading “Vendor Financings”
it being understood that Liens reflected under such heading shall be permitted
only if in compliance with Section 6.7(c) or Section 6.7(d)) and
permitted refinancings, extensions and renewals thereof, including extensions
or renewals of any such Liens, provided, that
the principal amount of the Indebtedness so secured is not increased and the
Lien does not attach to any other property; (c) Liens created by
conditional sale or other title retention agreements (including Capital Leases)
or in connection with purchase money Indebtedness with respect to P&E and
Fixtures acquired by a Credit Party in the ordinary course of its business,
involving the incurrence of an aggregate amount of purchase money Indebtedness
and Capita] Lease Obligations for all Credit Parties of not more than
$15,000,000 outstanding at any one time for all such Liens (provided, that (i) such Liens attach
only to the assets subject to such purchase money debt and proceeds thereof, (ii) such
Indebtedness is incurred within ninety (90) days following such purchase; and (d) (x)
Liens created by conditional sale or other tide retention agreements (including
Capital Leases) or in connection with purchase money Indebtedness provided by
the seller of such Equipment Inventory or an Affiliate of such seller or a third
party financing source not affiliated with such seller with respect to
Equipment Inventory acquired by a Credit Party in the ordinary course of its
business, involving the incurrence of an aggregate principal amount of purchase
money Indebtedness for all Credit Parties of not more than $90,000,000 in
principal amount outstanding at any one time for all such Liens and (y) Liens
on rental proceeds of Equipment Inventory leased by a Borrower securing true
lease obligations of a Borrower of Equipment Inventory, provided, that (i) such Liens attach
only to the Equipment Inventory purchased with the proceeds of such purchase
money Indebtedness or such rental proceeds except as otherwise permitted by any
agreement referred to in subparagraph (iii) below, (ii) such
Indebtedness is incurred at the time of such purchase and (iii) a Vendor
Inter-Creditor Agreement between the holder of such Lien and

 

 

Agent (in the form of Exhibit 6.7(d)(iii)(A) in the case of
Floor Plan Equipment Inventory, and in the form of Exhibit 6.7(d)(iii)(B) in
the case of Off Balance Sheet Equipment Inventory, in each case with such
changes thereto as may be acceptable to Agent or such other form of
intercreditor agreement as Agent may approve) has been delivered to Agent, provided, however, that notwithstanding
the foregoing, the Credit Parties may have outstanding Indebtedness or lease
obligations secured by a Lien described in this paragraph (d) without a
Vendor Inter-Creditor Agreement so long as the aggregate amount of such
Indebtedness or lease obligations does not exceed (x) during the period ending
thirty (30) days following the Closing Date, $17,500,000 in the aggregate for
all Credit Parties, including as to lease obligations, the amount of purchase
option amounts payable thereunder or (y) thereafter, $4,000,000 in the
aggregate in respect of lease obligations and $0 in respect of such
Indebtedness, for all Credit Parties, excluding as to lease obligations,
purchase option amounts payable thereunder, it being understood that the Agent
may establish Reserves in respect of any such Indebtedness or lease obligations
for which no Vendor Inter-Creditor Agreement has been delivered.  In addition, no Credit Party shall become a
party to any agreement, note, indenture or instrument, or take any other
action, that would prohibit the creation of a Lien on any of its properties or
other assets in favor of Agent, on behalf of itself and Lenders, as additional
collateral for the Obligations, except operating leases, Capital Leases or
Licenses which prohibit Liens upon the assets that are subject thereto.

 

6.8                                 Disposition of Stock
and Assets

 

No Credit Party shall sell, lease, license, transfer, convey, assign or
otherwise dispose of any of its properties or other assets (other than cash),
including the Stock of any of its Subsidiaries (whether in a public or a
private offering or otherwise) or any of their Accounts, other than (a) the
sale or lease by a Borrower of Equipment Inventory in the ordinary course of
its business, (b) the sale, transfer, conveyance or other disposition by a
Credit Party of P&E, Equipment Inventory, Fixtures or Real Estate that are
obsolete or no longer used or useful in such Credit Parry’s business and having
a Net Book Value not exceeding $250,000 in any single transaction or $500,000
for all Credit Parties in the aggregate in any Fiscal Year, (c) the sale,
transfer, conveyance or other disposition by a Credit Party of Equipment
Inventory that is part of a discontinued line, (d) the sale, transfer,
conveyance or other disposition by a Credit Party of other P&E and Fixtures
having a value not exceeding $500,000 in any single transaction or $1,000,000 in
the aggregate for all Credit Parties in any Fiscal Year, (e) the licensing
of Intellectual Property by any Credit Party in the ordinary course of its
business, (f) the sale, transfer, conveyance or other disposition of
assets from a Borrower to another Borrower and (g) a trade-in or trade-up
of assets (pursuant to which such Credit Party acquires a substantially similar
asset to the one disposed of within forty-five (45) days following such
disposition and the value of the asset
disposed of is credited against the purchase price of the asset so acquired) by
a Credit Party in the ordinary course of its business.  With respect to any disposition of assets or
other properties permitted pursuant to clauses (b) and (c) above,
subject to Section 1.3(b), Agent agrees on reasonable prior written notice
to release its Lien (and the Lenders authorize Agent to do so) on such assets
or other properties in order to permit the applicable Credit Party to effect
such disposition and shall execute and deliver to such Credit Party, at such
Credit Party’s expense,

 

 

appropriate UCC-3
termination statements and other releases as reasonably requested by such
Credit Party.

 

6.9                                 ERISA

 

No Credit Party shall, nor shall it cause or permit any ERISA Affiliate
to, cause or permit to occur an event that could result in the imposition of a
Lien under Section 412(n) of the IRC or Section 302(f) or 4068
of ERISA or cause or permit to occur an ERISA Event to the extent such Lien or
such ERISA Event could reasonably be expected to have a Material Adverse
Effect.

 

6.10                           Financial Covenants

 

No Borrower shall breach or fail to comply with any of the Financial
Covenants.

 

6.11                           Hazardous Materials

 

No Credit Party shall cause or permit a Release of any Hazardous
Material on, at, in, under, above, to, from or about any of the Real Estate
where such Release would (a) violate in any respect, or form the basis for
any Environmental Liabilities under, any Environmental Laws or Environmental
Permits or (b) otherwise adversely impact the value or marketability of
any of the Real Estate or any of the Collateral, other than such violations or
impacts that could not reasonably be expected to have a Material Adverse
Effect.

 

6.12                           Designated Senior Debt

 

This Agreement and the Indebtedness arising hereunder are “Designated
Senior Debt” under the Senior Subordinated Note Indenture and H&E shall not
designate any other Indebtedness or any credit agreement as “Designated Senior
Debt” thereunder without the prior consent of Requisite Lenders

 

6.13                           Cancellation of Indebtedness

 

No Credit Party shall cancel any claim or debt owing to it having a
face value exceeding $100,000 except for reasonable consideration negotiated on
an arm’s-length basis and in the ordinary course of its business consistent
with past practices.

 

6.14                           Restricted Payments

 

No Credit Party shall make any Restricted Payment, except (a) intercompany
loans and advances between Borrowers and payments of principal and interest on
Intercompany Notes, in each case to the extent permitted by Section 6.3, (b) dividends
and distributions by Subsidiaries
of a Borrower paid to such Borrower, (c) employee loans permitted under Section 6.4(b) above,
(d) payments of management fees pursuant to the BRS Management Services
Agreement in accordance with Section 3.14 on the Closing Date, and
thereafter not to exceed the greater, on an annual basis, of (x) $2,000,000 or
(y) one point seventy-five percent (1.75%) of EBITDAR for the immediately
preceding Fiscal Year, in each case plus reasonable out-of-pocket
expenses,

 

 

(e) scheduled payments of interest as and when due and payable
with respect to the Subordinated Debt, subject to the subordination terms
thereof, (f) repurchases of Stock of any employee of such Credit Party
upon termination of such employee, subject to Section 6.4(b), (g) distributions
to H&E Holdings to the extent necessary to pay the taxes of H&E
Holdings and to cover administrative fees and reasonable out-of-pocket
expenses, and with respect to such fees and expenses in an amount not to exceed
$250,000, and (h) distributions of Stock of such Credit Party in
connection with the cashless exercise of options by the holders of options for
Stock of such Credit Party; provided, that
in the case of clauses (d) and (f) above (i) no Default or Event
of Default shall have occurred and be continuing or would result after giving
effect to any Restricted Payment pursuant to clauses (d) and (f) above.

 

6.15                           Change of Name or Location; Change of Fiscal
Year

 

No Credit Party shall (a) change its name as it appears in
official filings in the state of its incorporation or organization, or (b) change
its offices or warehouses or locations at which Collateral is held or stored,
or the location of its records concerning the Collateral, (c) change the
type of entity that it is, (d) change its organization identification
number, if any, issued by its state of incorporation or organization, or (e) change
its state of incorporation or organization, in each case without at least
thirty (30) days prior written notice to Agent and after Agent’s written
acknowledgment that any reasonable action requested by Agent in connection
therewith, including to continue the perfection of any Liens in favor of Agent,
on behalf of Lenders, in any Collateral, has been completed or taken; provided that any such new location shall
be in the continental United States.  Without
limiting the foregoing, no Credit Party shall change its name, identity or
limited liability company (or corporate, as the case may be) structure in any
manner that might make any financing or continuation statement filed in
connection herewith seriously misleading within the meaning of Section 9-506
or 9-507 of the Code or any other then applicable provision of the Code except
upon prior written notice to Agent and Lenders and after Agent’s written
acknowledgment that any reasonable action requested by Agent in connection
therewith, including to continue the perfection of any Liens in favor of Agent,
on behalf of Lenders, in any Collateral, has been completed or taken.  No Credit Party shall change its Fiscal Year
without the prior consent of Agent.

 

6.16                           No Impairment of Intercompany Transfers

 

No Credit Party shall directly or indirectly enter into or become bound
by any agreement, instrument, indenture or other obligation (other than this
Agreement and the other Loan Documents) that could directly or indirectly
restrict, prohibit or require the consent of any Person with respect to the
payment of dividends or distributions or the making or repayment of
intercompany loans by a Subsidiary of a Borrower to such Borrower or between
Borrowers.

 

6.17                           No Speculative Transactions

 

No Credit Party shall engage in any transaction involving commodity
options, futures contracts or similar transactions, except solely to hedge
against fluctuations in the prices of commodities

 

 

owned or purchased by it and the values of foreign currencies
receivable or payable by it and interest swaps, caps or collars under a Hedging
Agreement; provided that (i) any
such Hedging Agreement must have a Lender as the sole counterparty, (ii) at
any time, the aggregate amount payable upon termination, liquidation or
cancellation of such Hedging Agreements for all Credit Parties, calculated in
accordance with GAAP, shall not exceed $1,000,000 and (iii) at any time,
Agent may maintain Reserves in the amount of such aggregate amount.

 

6.18                           Changes Relating to Senior Debt; Subordinated
Debt Designation of Credit Facility

 

(a)                                  No Credit Party shall change or amend the
terms of any Senior Debt or Subordinated Debt (or any indenture or agreement in
connection therewith) if the effect of such amendment is to: (a) increase the interest rate
on such Senior Debt or such Subordinated Debt by more than two percentage
points (2%); (b) change the dates upon which payments of principal or
interest are due on such Senior Debt or such Subordinated Debt other than to
extend such dates; (c) add any default, event of default or change any
default or event of default other than to delete or make less restrictive any
default provision therein, or add any covenant with respect to such Senior Debt
or such Subordinated Debt; (d) add any covenant or change any covenant in
a matter adverse to such Credit Party, (e) change the redemption or
prepayment provisions of such Senior Debt or such Subordinated Debt other than
to extend the dates therefor or to reduce the premiums payable in connection
therewith; (f) grant any security or collateral to secure payment of such
Senior Debt or such Subordinated Debt; (g) with respect to the Senior Note
Indenture and the Senior Subordinated Note Indenture, each change or amend the
asset sale provision of the Senior Note Indenture or the Senior Subordinated
Note Indenture, in each case, without the prior written approval of the
Required Lenders, (h) change or amend the definition of “Borrowing Base”
contained therein, or (i) change or amend any other term if such change or
amendment would materially increase the obligations of the Credit Party
thereunder or confer additional material rights on the holder of such Senior
Debt or such Subordinated Debt in a manner adverse to any Credit Party, Agent
or any Lender.

 

(b)                                 No Credit Party shall designate any credit
agreement, credit facility, documents, agreement or indebtedness as a “Credit
Facility” under and as such term is defined in the Senior Note Indenture, as
originally in effect or as a “Credit Facility” under which as such term is
defined in the Senior Subordinated Note Indenture, as originally in effect,
other than, in each case, this Agreement, or, except for this Agreement and the
Loan Documents, otherwise grant to any Indebtedness or Liens securing the same
the rights of “Priority Lien Obligations” or “Priority Liens” as such terms are
defined in the Senior Note Indenture, as originally in effect.

 

6.19                           Changes in Depreciation Schedules

 

No Credit Party shall change or amend the schedules or methodology used
to calculate depreciation on its assets (except as required by applicable law
or by a change in GAAP).

 

 

6.20                           Credit Parties Other than Borrowers

 

None of H&E Holdings, H&E Finance and GNE Investments shall
engage in any trade or business, or own any assets (other than Stock of their
Subsidiaries) or incur any Indebtedness or Guaranteed Indebtedness (other than
the Obligations); provided that (i) H&E
Finance may consummate the transactions contemplated by the Senior Note
Indenture and the Senior Subordinated Note Indenture, (ii) H&E
Holdings may incur certain rights and obligations under the BRS Management
Agreement and (iii) GNE Investments may provide the guaranty of (x) the
Senior Notes as provided for in the Senior Note Indenture and (y) the Senior
Subordinated Notes as provided for in the Senior Subordinated Note Indenture
and (iv) H&E, H&E Finance and GNE Investments may consummate the
Related Transactions.

 

6.21                           Lock Box Remittances; Vendor Payments

 

No Credit Party shall make, direct or permit any remittance to be made
into any lock box maintained for the benefit of Agent that is subject to any
Lien or claim or other interest of any Person, other than Liens in favor of
Agent, on behalf of itself and Lenders, and Collateral Agent, on behalf of the
holders of Senior Notes and Liens in favor of the applicable depository bank
permitted by the applicable lock box or pledged account agreement with such
depository bank; provided, that
the Credit Parties shall not be in default under this Section 6.21 if the
amount on deposit in the deposit accounts associated with all such lock boxes
and subject to any Lien or claim of any Person (other than the depositary bank)
does not exceed $200,000 in the aggregate at any time.  No Credit Party shall send an invoice or
otherwise bill any purchaser with respect to the purchase of any Floor Plan
Equipment Inventory or any Off Balance Sheet Equipment Inventory (that has been
purchased by a Credit Party) prior to the payment by such Credit Party of the
purchase price of such Floor Plan Equipment Inventory or such Off Balance Sheet
Equipment Inventory into such a lock box.  Each Credit Party shall comply with all
requirements of each Vendor Inter-Creditor Agreement and shall give all notices
and take all other actions under each Vendor Inter-Creditor Agreement to insure
compliance with the requirements of this Section 6.21.

 

7.              TERM

 

7.1                                 Termination

 

The financing arrangements contemplated hereby shall be in effect until
the Commitment Termination Date, and the Loans and all other Obligations shall
be automatically due and payable in full on such date.

 

7.2                                 Survival of Obligations Upon Termination of
Financing Arrangements

 

Except as otherwise expressly provided for in the Loan Documents, no
termination or cancellation (regardless of cause or procedure) of any financing
arrangement under this Agreement shall in any way affect or impair the
obligations, duties and liabilities of Credit Parties or the rights of Agent
and Lenders relating to any unpaid portion of the Loans or any other

 

 

Obligations, due or not due, liquidated, contingent or unliquidated, or
any transaction or event occurring prior to such termination, or any
transaction or event, the performance of which is required after the Commitment
Termination Date.  Except as otherwise
expressly provided herein or in any other Loan Document, all undertakings,
agreements, covenants, warranties and representations of or binding upon any
Credit Party, and all rights of Agent and each Lender, all as contained in the
Loan Documents, shall not terminate or expire, but rather shall survive any
such termination or cancellation and shall continue in full force and effect
until the Termination Date, whereupon it shall terminate; provided, that the provisions of Section 11,
the payment obligations under Sections 1.15 and 1.16, and the indemnities
contained in the Loan Documents shall survive the Termination Date and provided further that the indemnities
contained in the Loan Documents in favor of a Lender shall survive the
assignment by such Lender of the Commitments and Loans of such Lender.

 

7.3                                 Default Purchase Option

 

Agent agrees to promptly provide notice to the trustee under the Senior
Note Indenture when there has occurred the maturity (including as a result of
acceleration or the commencement of an Event of Default under Section 8.1(h) or
8.1(i)) of the Obligations and the termination of the Revolving Loan
Commitment.  Such notice (the “Default Notice”) shall include the name and address of each
Lender, and Agent agrees to notify Trustee of the name and address of any new
Lender that acquires a Loan during the period beginning on the date of such
Default Notice and ending on the earlier of the date twenty (20) Business Days
following the delivery of the Default Notice or the Authorized Representative
Property Elects under this Section 7.3, If an Authorized Representative
Properly Elects to purchase all “Priority Lien Indebtedness” (as such term is
defined in the Senior Note Indenture as originally in effect) arising under or
secured by the Loan Documents (including, without limitation, Indebtedness
arising under Hedging Agreements secured thereby), each Lender agrees to sell
all, but not less than all, of the principal of and interest on and all
prepayment or acceleration penalties and premiums in respect of the Loans
outstanding at the time of purchase and all other Obligations (except
Unasserted Contingent Obligations (as defined in the Senior Note Indenture as
originally in effect)) then outstanding, together with all rights of such
Lender with respect Jo Liens securing such Obligations and all Guarantees and
other supporting obligations relating to such Obligations (the “Subject Property”), to Eligible Purchasers (as such term is
defined in the Senior Note Indenture as originally in effect) identified by the
Authorized Representative upon the following terms and conditions: (a) for
a purchase price equal to 100% of the principal amount and accrued interest
outstanding on the Obligations included in the Subject Property on the date of
purchase plus all other Obligations included in the Subject Property (except
any prepayment or acceleration penalty or premium (the term “prepayment penalty
or acceleration premium” being deemed not to include default interest or LIBOR
Rate breakage costs)) then unpaid, (b) with such purchase price payable in
cash on the date of purchase (which date of purchase shall occur before the
latter of (i) twenty (20) Business Days following the date of receipt by
such trustee of the Default Notice and (ii) five (5) Business Days
after the Authorized Representative shall have Properly Elected to purchase
under this Section 7.3), against transfer to one or more “Eligible
Purchasers” or its

 

 

nominee or transferee identified by the Authorized Representative (such
transfer to be without recourse and without any representation or warranty
whatsoever, whether as to the enforceability of any Obligations included in the
Subject Property or the validity, enforceability, perfection or priority or
sufficiency of any Lien securing, or Guaranty or other supporting obligation
for, any Obligations included in the Subject Property or as to any other matter
whatsoever, except only the representation and warranty that the transferee is
transferring free and clear of all Liens and encumbrances (other than those
that will be satisfied and discharged concurrently with the closing of such
purchase), and has good right to convey, whatever claims and interest it may
have in respect of the Subject Property pursuant to the Loan Documents), (c) with
such purchase accompanied by a deposit by the Authorized Representative on
behalf of such “Eligible Purchasers” of cash collateral under control of the
Agent (pursuant to agreements reasonably acceptable to the Agent and with a
depositary reasonably acceptable to the Agent) in an amount equal to 105% of
the undrawn amount of each Letter of Credit then outstanding, as security for
the additional obligation of the purchaser to purchase, at par plus accrued
interest, the reimbursement obligation in respect of such Letters of Credit as
and when such Letters of Credit are funded and to pay all Obligations included
in the Subject Property then outstanding relating to such Letter of Credit and (d) upon
documents reasonably acceptable to Agent, such Lender and the Authorized
Representative and consistent with the foregoing clauses (a) through (c).  The option to purchase under this Section 7.3
is exercisable only once.  An “Authorized Representative” shall mean the Trustee or an
Eligible Purchaser (as such term is defined in the Senior Note Indenture as
originally in effect) who the Trustee, in a writing delivered to the Agent and
each Lender, indicates is authorized to exercise rights under this Section 7.3.
 The term “Properly
Elects” means the delivery within twenty (20) Business Days
following receipt by the Trustee of notice of acceleration of the Obligations
and termination of the Commitments to the Agent and each Lender by an
Authorized Representative of an irrevocable written notice to purchase all “Priority
Lien Indebtedness” (as such term is defined in the Senior Note Indenture as
originally in effect) arising under or secured by the Loan Documents
(including, without limitation, Indebtedness arising under Hedging Agreements)
pursuant to the terms of this Section 7.3.

 

8.              EVENTS OF DEFAULT: RIGHTS AND REMEDIES

 

8.1                                 Events of Default

 

The occurrence of any one or more of the following events (regardless
of the reason therefor) shall constitute an “Event of Default” hereunder:

 

(a)                                  Any Borrower (i) fails to make any
payment of principal of; or interest on, or Fees owing in respect of, the Loans
or any of the other Obligations when due and payable, or fails to provide cash
collateral as and when required, or (ii) fails to pay or reimburse Agent
or Lenders for any expense reimbursable hereunder or under any other Loan
Document within ten (10) days following Agent’s demand for such
reimbursement or payment of expenses.

 

 

(b)                                 Any Credit Party fails or neglects to
perform, keep or observe any of the provisions of Sections 1.4, 1.8, 5.4(a) or
6 applicable to it, or any of the provisions set forth in Annexes C, E or G,
respectively applicable to it.

 

(c)                                  Any Credit Party fails or neglects to
perform, keep or observe any of the provisions of Section 4 or any
provisions set forth in Annex F, applicable to it and the same shall remain
unremedied for ten (10) days or more.

 

(d)                                 Any Credit Party fails or neglects to
perform, keep or observe any other provision of this Agreement or of any of the
other Loan Documents applicable to it, (other than any provision embodied in or
covered by any other clause of this Section 8.1) and the same shall remain
unremedied for thirty (30) days or more.

 

(e)                                  A default or breach occurs under any other
agreement, document or instrument to which any Credit Party is a party that is
not cured within any applicable grace period therefor, and such default or
breach (i) involves the failure to make any payment when due in respect of
any Indebtedness or Guaranteed Indebtedness (other than the Obligations) of any
Credit Party, including the Senior Debt and the Indebtedness under the Senior Subordinated
Note Indenture, in excess of $2,000,000 in the aggregate (including (x) undrawn
committed or available amounts and (y) amounts owing to all creditors under any
combined or syndicated credit arrangements), or in respect of any lease under which
any Credit Party is lessee under which the aggregate cost of the leased
property exceeds $2,000,000, or (ii) causes, or permits any holder of such
Indebtedness or Guaranteed Indebtedness or a trustee to cause, Indebtedness or
Guaranteed Indebtedness or a portion thereof, including the Senior Debt, in
excess of $2,000,000 in the aggregate, or rent in excess of $2,000,000 in the
aggregate, to become due prior to its stated maturity or prior to its regularly
scheduled dates of payment, or cash collateralized in respect thereof to be
demanded, in each case, regardless of whether such right is exercised, by such
holder or trustee.

 

(f)                                    Any information contained in any Borrowing
Base Certificate is untrue or incorrect in any respect (other than inadvertent,
immaterial errors not exceeding $2,500,000 in the aggregate in any Borrowing
Base Certificate), or any representation or warranty herein or in any Loan
Document or in any written statement, report, financial statement or certificate
(other than a Borrowing Base Certificate) made or delivered to Agent or any Lender
by any Credit Party is untrue or incorrect in any material respect as of the
date when made or deemed made.

 

(g)                                 Assets with a value in excess of $1,000,000
of any Credit Party are attached, seized, levied upon or subjected to a writ or
distress warrant, or come within the possession of any receiver, trustee,
custodian or assignee for the benefit of creditors of any Credit Party and such
condition continues for sixty (60) days or more.

 

 

(h)                                 A case or proceeding is commenced against any
Credit Party seeking a decree or order in respect of such Credit Party (i) under
the Bankruptcy Code, or any other applicable federal, state or foreign
bankruptcy or other similar law, (ii) appointing a custodian, receiver,
liquidator, assignee, trustee or sequestrator (or similar official) for such
Credit Party or for any substantial part of any such Credit Party’s assets, or (iii) ordering
the winding-up or liquidation of the affairs of such Credit Party, and such
case or proceeding shall remain undismissed or unstayed for 60 days or more or
a decree or order granting the relief sought in such case or proceeding shall
be entered by a court of competent jurisdiction.

 

(i)                                     Any Credit Party (i) files a petition
seeking relief under the Bankruptcy Code, or any other applicable federal,
state or foreign bankruptcy or other similar law, (ii) consents to or
fails to contest in a timely and appropriate manner the institution of
proceedings thereunder or the filing of any such petition or the appointment of
or taking possession by a custodian, receiver, liquidator, assignee, trustee or
sequestrator (or similar official) for such Credit Party or for any substantial
part of any such Credit Party’s assets, (iii) makes an assignment for the
benefit of creditors, (iv) takes any action in furtherance of any of the
foregoing or (v) admits in writing its inability to, or is generally
unable to, pay its debts as such debts become due.

 

(j)                                     A final judgment or judgments for the payment
of money in excess of $1,000,000 in the aggregate at any time are outstanding
against one or more of the Credit Parties and the same are not, within 30 days
after the entry thereof, discharged or execution thereof stayed or bonded
pending appeal, or such judgments are not discharged prior to the expiration of
any such stay.

 

(k)                                  Any material provision of any Loan Document
for any reason ceases to be valid, binding and enforceable in accordance with
its terms (or any Credit Party shall challenge the enforceability of any Loan
Document or shall assert in writing, or engage in any action or inaction based
on any such assertion, that any provision of any of the Loan Documents has
ceased to be or otherwise is not valid, binding and enforceable in accordance
with its terms), or any Lien created under any Loan Document on assets with a
value in excess of $1,000,000 in the aggregate ceases to be a valid and
perfected first priority Lien (except as otherwise permitted herein or therein)
in any of the Collateral purported to be covered thereby.

 

(l)                                     Any Change of Control occurs.

 

8.2                                 Remedies

 

(a)                                  If any Default or Event of Default has
occurred and is continuing, Agent may (and at the written request of the Requisite
Lenders shall), without notice, suspend this facility with respect to
additional Advances and/or the incurrence of additional Letter of Credit
Obligations, whereupon any additional Advances and additional Letter of Credit

 

 

Obligations shall be made or incurred in Agent’s sole discretion (or in
the sole discretion of the Requisite Lenders, if such suspension occurred at
their direction) so long as such Default or Event of Default is continuing.  If any Default or Event of Default has
occurred and is continuing, Agent may (and at the written request of Requisite
Lenders shall), without notice except as otherwise expressly provided herein,
increase the rate of interest applicable to the Loans and the Letter of Credit
Fees to the Default Rate.

 

(b)                                 If any Event of Default has occurred and is
continuing, Agent may (and at the written request of the Requisite Lenders
shall), without notice, (i) terminate this facility with respect to
further Advances or the incurrence of further Letter of Credit Obligations, (ii) declare
all or any portion of the Obligations, including all or any portion of any Loan
to be forthwith due and payable, and require that the Letter of Credit
Obligations be cash collateralized as provided in Annex B, all without
presentment, demand, protest or further notice of any kind, all of which are
expressly waived by each Credit Party, or (iii) exercise any rights and
remedies provided to Agent under the Loan Documents or at law or equity,
including all remedies provided under the Code; provided, that upon the occurrence of an Event of Default
specified in Section 8.1(h) or Section 8.1(i), all of the
Obligations, including the Revolving Loan, shall become immediately due and
payable without declaration, notice or demand by any Person.

 

8.3                                 Waivers by Credit Parties

 

Except as otherwise provided for in this Agreement or by applicable
law, each Credit Party waives (including for purposes of Section 12): (a) presentment,
demand and protest and notice of presentment, dishonor, notice of intent to
accelerate, notice of acceleration, protest, default, nonpayment, maturity,
release, compromise, settlement, extension or renewal of any or all commercial
paper, accounts, contract rights, documents, instruments, chattel paper and
guaranties at any time held by Agent on which any Credit Party may in any way
be liable, and hereby ratifies and confirms whatever Agent may do in this
regard, (b) all rights to notice and a hearing prior to Agent’s taking
possession or control of, or to Agent’s replevy, attachment or levy upon, the
Collateral or any bond or security that might be required by any court prior to
allowing Agent to exercise any of its remedies, and (c) the benefit of all
valuation, appraisal, marshalling and exemption laws.

 

9.              ASSIGNMENT AND PARTICIPATIONS;
APPOINTMENT OF AGENT

 

9.1                                 Assignment and Participations

 

(a)                                  Subject to the terms of this Section 9.1,
any Lender may make an assignment to a Qualified Assignee of, or sell
participations in, at any time or times, the Loan Documents, Loans, Letter of
Credit Obligations and any Commitment or any portion thereof or interest
therein, including any Lender’s rights, title, interests, remedies, powers or
duties thereunder.  Any assignment by a
Lender shall (i) require the consent of Agent (which consent shall not be
unreasonably withheld or delayed with respect to a Qualified

 

 

Assignee) and, so long as no Default or Event of Default has occurred
and is continuing, the Borrower Representative (which shall not be unreasonably
withheld or delayed) and the execution of an assignment agreement (an “Assignment Agreement”)
substantially in the form attached hereto as Exhibit 9.1(a) and
otherwise in form and substance reasonably satisfactory to, and acknowledged
by, Agent, provided, that neither
the Agent’s nor the Borrower Representative’s consent shall be required if such
assignment is to an existing Lender, to an Affiliate of such assigning Lender
or to a special purpose entity organized to acquire commercial loans and
managed by an existing Lender or an Affiliate or an existing Lender, and, provided, further that Borrower
Representative’s consent shall not be required if such assignment is to a
Qualified Assignee; (ii) be conditioned on such assignee Lender
representing to the assigning Lender and Agent that it is purchasing the
applicable Loans to be assigned to it for its own account, for investment
purposes and not with a view to the distribution thereof; (iii) after
giving effect to any such partial assignment, the assignee Lender shall have
Commitments in an amount at least equal to $5,000,000 and the assigning Lender
shall have retained Commitments in an amount at least equal to $5,000,000; (iv) include
a payment to Agent by the assignor or assignee of an assignment fee of $3,500.  In the case of an assignment by a Lender under
this Section 9.1, the assignee shall have, to the extent of such
assignment, the same rights, benefits and obligations as all other Lenders
hereunder and (v) not be effective until such assignment is reflected in
the Loan Account.  Subject to the proviso
in the last sentence of Section 7.2, the assigning Lender shall be
relieved of its obligations hereunder with respect to its Commitments or
assigned portion thereof from and after the date of such assignment.  Each Credit Party hereby acknowledges and
agrees that any assignment shall give rise to a direct obligation of such
Credit Party to the assignee and that the assignee shall be considered to be a “Lender”.  In all instances, each
Lender’s liability to make Loans hereunder shall be several and not joint and
shall be limited to such Lender’s Pro Rata Share of the applicable Commitment.  In the event Agent or any Lender assigns or
otherwise transfers all or any part of a Note, Agent or any such Lender shall
so notify Borrowers and each Borrower shall execute new Notes in exchange for
the Notes being assigned.  Notwithstanding
the foregoing provisions of this Section 9.1(a), any Lender may at any
time pledge as security for obligations of such Lender or assign all or any
portion of such Lender’s rights under this Agreement and the other Loan
Documents to any Person, including to a Federal Reserve Bank; provided, that no such pledge or
assignment shall release such Lender from such Lender’s obligations hereunder
or under any other Loan Document.

 

(b)                                 Any participation by a Lender of all or any
part of its Commitments and Loans shall be entered into with the understanding
that all amounts payable by Borrowers hereunder shall be determined as if that
Lender had not sold such participation, and that the holder of any such
participation shall not be entitled to require such Lender to take or omit to
take any action hereunder except actions directly affecting (i) any
reduction in the principal amount of, or interest rate or Fees payable with
respect to, any Loan in which such holder participates, (ii) any extension
of the final maturity of the principal amount of

 

 

any Loan in which such holder participates, and (iii) any release
of all or substantially all of the Collateral (other than in accordance with
the terms of this Agreement, the Collateral Documents or the other Loan
Documents).  Each participation created
by any Lender shall provide that it shall be terminated by such Lender upon
sale of such Lender’s Obligations pursuant to Section 7.3 (and such Lender
shall pay to the participant all amounts required to be paid under such
participation upon termination).  Solely
for purposes of Sections 1.13, 1.15, 1.16 and 9.8, each Borrower acknowledges
and agrees that a participation shall give rise to a direct obligation of such
Borrower to the participant and the participant shall be considered to be a “Lender”; provided, that any
such participant shall not be entitled to receive any greater payment under Section 1.15
or Section 1.16 than the Lender granting such participation would have
been entitled to receive with respect to the portion of its Commitment and
Loans so participated.  Except as set
forth in the preceding sentence no Borrower shall have any obligation or duty
to any participant. Neither Agent nor any Lender (other than the Lender selling
a participation) shall have any duty to any participant and may continue to
deal solely with the Lender selling a participation as if no such sale had
occurred.

 

(c)                                  Except as expressly provided in this Section 9.1,
no Lender shall, as between the Credit Parties, and that Lender, or Agent and
that Lender, be relieved of any of its obligations hereunder as a result of any
sale, assignment, transfer or negotiation of, or granting of participation in,
all or any part of the Loans, the Notes or other Obligations owed to such Lender.

 

(d)                                 Each Credit Party shall assist any Lender
permitted to sell assignments or participations under this Section 9.1 as
reasonably required to enable the assigning or selling Lender to effect any
such assignment or participation, including the execution and delivery of any and
all agreements, notes and other documents and instruments as shall be requested
and, in connection with the initial syndication of the Loans and Commitments
and if otherwise requested by Agent, the preparation of informational materials
for, and the participation of management in meetings with, potential assignees
or participants.  Each Credit Party shall
certify the correctness, completeness and accuracy of all descriptions of the
Credit Parties and their respective affairs contained in any selling materials
provided by it and all other information provided by it and included in such
materials, except that any Projections delivered by Borrowers shall only be
certified by Borrowers as having been prepared by Borrowers in compliance with
the representations contained in Section 3.4(c).

 

(e)                                  Any Lender may furnish any information
concerning any Credit Party in the possession of such Lender from time to time
to assignees and participants (including prospective assignees and
participants); provided, that
such Lender shall obtain from assignees or participants confidentiality
covenants substantially equivalent to those contained in Section 11.8.

 

 

(f)                                    So long as no Event of Default has occurred
and is continuing, no Lender shall assign or sell participations in any portion
of its Loans or Commitments to a potential Lender or participant, if, as of the
date of the proposed assignment or sale, the assignee Lender or participant
would be subject to capital adequacy, reserve or similar requirements under Section 1.16(a),
increased costs under Section 1.16(b), an inability to fund LIBOR Loans
under Section 1.16(c), or withholding taxes in accordance with Section l.16(d).

 

9.2                                 Appointment of Agent

 

GE Capital is hereby appointed to act on behalf of all Lenders as Agent
under this Agreement and the other Loan Documents.  The provisions of this Section 9.2 are
solely for the benefit of Agent and Lenders and no Credit Party nor any other
Person shall have any rights as a third party beneficiary of any of the
provisions hereof.  In performing its
functions and duties under this Agreement and the other Loan Documents, Agent
shall act solely as an agent of Lenders and does not assume and shall not be
deemed to have assumed any obligation toward or relationship of agency or trust
with or for any Credit Party or any other Person.  Agent shall have no duties or responsibilities
except for those expressly set forth in this Agreement and the other Loan
Documents.  The duties of Agent shall be
mechanical and administrative in nature and Agent shall not have, or be deemed
to have, by reason of this Agreement, any other Loan Document or otherwise a
fiduciary relationship in respect of any Lender.  Except as expressly set forth in this
Agreement and the other Loan Documents, Agent shall not have any duty to
disclose, and shall not be liable for failure to disclose, any information
relating to any Credit Party or any of their respective Subsidiaries or any
Account Debtor that is communicated to or obtained by GE Capital or any of its
Affiliates in any capacity.  Neither
Agent nor any of its Affiliates nor any of their respective officers,
directors, employees, agents or representatives shall be liable to any Lender
for any action taken or omitted to be taken by it hereunder or under any other
Loan Document, or in connection herewith or therewith, except for damages
solely caused by its or their own gross negligence or willful misconduct as
finally determined by a court of competent jurisdiction.  Each Lender which is a party to a Hedging
Agreement hereby appoints GE Capital as collateral agent under the Collateral
Documents.

 

If Agent shall request instructions from Requisite Lenders, Majority
Revolving Lenders or all affected Lenders with respect to any act or action
(including failure to act) in connection with this Agreement or any other Loan
Document, then Agent shall be entitled to refrain from such act or taking such
action unless and until Agent shall have received instructions from Requisite
Lenders, Majority Revolving Lenders, or all affected Lenders, as the case may
be, and Agent shall not incur liability to any Person by reason of so
refraining.  Agent shall be fully
justified in failing or refusing to take any action hereunder or under any
other Loan Document (a) if such action would, in the opinion of Agent, be
contrary to law or the terms of this Agreement or any other Loan Document, (b) if
such action would, in the opinion of Agent, expose Agent to Environmental
Liabilities or (c) if Agent shall not first be indemnified to its
satisfaction against any and all liability and expense which may be incurred by
it by reason of taking or continuing to take any such action.  Without limiting the foregoing, no Lender
shall have any right of action whatsoever

 

 

against Agent as a result of Agent acting or refraining from acting
hereunder or under any other Loan Document in accordance with the instructions
of Requisite Lenders, Majority Revolving Lenders or all affected Lenders, as
applicable.

 

9.3                                Agent’s Reliance, Etc.

 

Neither Agent nor any of its Affiliates nor any of their respective
directors, officers, agents or employees shall be liable for any action taken
or omitted to be taken by it or them under or in connection with this Agreement
or the other Loan Documents, except for damages solely caused by its or their
own gross negligence or willful misconduct as finally determined by a court of
competent jurisdiction.  Without limiting
the generality of the foregoing, Agent: (a) may treat the payee of any
Note as the holder thereof until Agent receives written notice of the
assignment or transfer thereof signed by such payee and in form reasonably
satisfactory to Agent; (b) may consult with legal counsel, independent
public accountants and other experts selected by it and shall not be liable for
any action taken or omitted to be taken by it in good faith in accordance with
the advice of such counsel, accountants or experts; (c) makes no warranty
or representation to any Lender and shall not be responsible to any Lender for
any statements, warranties or representations made in or in connection with
this Agreement or the other Loan Documents; (d) shall not have any duty to
ascertain or to inquire as to the performance or observance of any of the
terms, covenants or conditions of this Agreement or the other Loan Documents on
the part of any Credit Party or to inspect the Collateral (including the books
and records) of any Credit Party; (e) shall not be responsible to any
Lender for the due execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Agreement or the other Loan Documents or any other
instrument or document furnished pursuant hereto or thereto; and (f) shall
incur no liability under or in respect of this Agreement or the other Loan
Documents by acting upon any notice, consent, certificate or other instrument
or writing (which may be by telecopy, telegram, cable or telex) believed by it
to be genuine and signed or sent by the proper party or parties.

 

9.4                                GE Capital and Affiliates

 

With respect to its Commitments hereunder, GE Capital shall have the
same rights and powers under this Agreement and the other Loan Documents as any
other Lender and may exercise the same as though it were not Agent; and the
term “Lender” or “Lenders” shall, unless otherwise expressly indicated, include
GE Capital in its individual capacity. GE Capital and its Affiliates may lend
money to, invest in, and generally engage in any kind of business with, any
Credit Party, any of its Affiliates and any Person who may do business with or
own securities of any Credit Party or any such Affiliate, all as if GE Capital
were not Agent and without any duty to account therefor to Lenders.  GE Capital and its Affiliates may accept fees
and other consideration from any Credit Party for services in connection with
this Agreement or otherwise without having to account for the same to Lenders.

 

 

9.5                                Lender Credit Decision

 

Each Lender acknowledges that it has,
independently and without reliance upon Agent or any other Lender and based on
the Financial Statements referred to in Section 3.4(a) and such other
documents and information as it has deemed appropriate, made its own credit and
financial analysis of the Credit Parties and its own decision to enter into
this Agreement.  Each Lender also
acknowledges that it will, independently and without reliance upon Agent or any
other Lender and based on such documents and information as it shall deem appropriate
at the time, continue to make its own credit decisions in taking or not taking
action under this Agreement.  Each Lender
acknowledges the potential conflict of interest of each other Lender as a
result of Lenders holding disproportionate interests in the Loans, and
expressly consents to, and waives any claim based upon, such conflict of
interest.

 

9.6                                Indemnification

 

Lenders agree to indemnify Agent and Arranger (to the extent not
reimbursed by Credit Parties and without limiting the obligations of Credit
Parties hereunder), ratably according to their respective Pro Rata Shares, from
and against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever that may be imposed on, incurred by, or asserted against
Agent or Arranger in any way relating to or arising out of this Agreement or
any other Loan Document or any action taken or omitted to be taken by Agent or
Arranger in connection therewith; provided, that
no Lender shall be liable for any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements resulting solely from Agent’s or Arranger’s gross negligence or
willful misconduct as finally determined by a court of competent jurisdiction.  Without limiting the foregoing, each Lender
agrees to reimburse Agent or Arranger promptly upon demand for its ratable
share of any out-of-pocket expenses (including reasonable counsel fees) incurred
by Agent or Arranger 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 and each other Loan Document,
to the extent that Agent is not reimbursed for such expenses by the Credit
Parties.

 

9.7                                Successor Agent

 

Agent may resign at any time by giving not less than thirty (30) days’
prior written notice thereof to Lenders and Borrower Representative.  Upon any such resignation, the Requisite
Lenders shall have the right to appoint a successor Agent.  If no successor Agent shall have been so
appointed by the Requisite Lenders and shall have accepted such appointment
within 30 days after the resigning Agent’s giving notice of resignation, then
the resigning Agent may, on behalf of Lenders, appoint a successor Agent, which
shall be a Lender, if a Lender is willing to accept such appointment, or
otherwise shall be a commercial bank or financial institution or a subsidiary
of a commercial bank or financial institution if such commercial bank or
financial institution is organized under the laws of the
United States of America or of any State thereof and has a

 

 

combined capital and surplus of at least $300,000,000.  If no successor Agent has been appointed
pursuant to the foregoing, within thirty (30) days after the date such notice
of resignation was given by the resigning Agent, such resignation shall become
effective and the Requisite Lenders shall thereafter perform all the duties of
Agent hereunder until such time, if any, as the Requisite Lenders appoint a
successor Agent as provided above.  Any
successor Agent appointed by Requisite Lenders hereunder shall be subject to
the approval of Borrower Representative, such approval not to be unreasonably
withheld or delayed; provided, that
such approval shall not be required if a Default or an Event of Default has
occurred and is continuing.  Upon the
acceptance of any appointment as Agent hereunder by a successor Agent, such
successor Agent shall succeed to and become vested with all the rights, powers,
privileges and duties of the resigning Agent.  Upon the earlier of the acceptance of any
appointment as Agent hereunder by a successor Agent or the effective date of
the resigning Agent’s resignation, the resigning Agent shall be discharged from
its duties and obligations under this Agreement and the other Loan Documents,
except that any indemnity rights or other rights in favor of such resigning
Agent shall continue.  After any
resigning Agent’s resignation hereunder, the provisions of this Section 9
shall inure to its benefit as to any actions taken or omitted to be taken by it
while it was acting as Agent under this Agreement and the other Loan Documents.
 Agent may be removed at the written
direction of the holders (other than Agent) of two-thirds or more of the
Commitments (excluding Agent’s Commitment); provided,
that in so doing, such Lenders shall be deemed to have waived and
released any and all claims they may have against Agent.

 

9.8                                Co-Agents

 

None of the Lenders identified on the facing page or signature pages of
this Agreement or any related document as “documentation agent”, “syndication
agent” or “arranger” shall have any right, power, obligation, liability,
responsibility or duty under this Agreement other than those applicable to all
Lenders as such.  Without limiting the
foregoing, none of the Lenders so identified as “documentation agent”, “syndication
agent” or “arranger” 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
so identified in deciding to enter into this Agreement or in taking or not
taking action hereunder.

 

9.9                                Setoff and Sharing of Payments

 

In addition to any rights now or hereafter granted under applicable law
and not by way of limitation of any such rights, upon the occurrence and during
the continuance of any Event of Default and subject to Section 9.9(f),
each Lender is hereby authorized at any time or from time to time, without
notice to any Credit Party or to any other Person, any such notice being hereby
expressly waived, to offset and to appropriate and to apply any and all
balances held by it at any of its offices for the account of any Credit Party
(regardless of whether such balances are then due to such Credit Party) and any
other properties or assets at any time held or owing by that Lender or that
holder to or for the credit or for the account of any Credit Party against and
on account of any of the Obligations that are not paid when due.  Any Lender exercising a right of setoff or
otherwise receiving any payment on account of the Obligations in excess of its
Pro Rata Share

 

 

thereof (other than any right of setoff exercised with respect to, or
payments under, Section 1.13, 1.15 or 1.16) shall purchase for cash (and
the other Lenders or holders shall sell) such participations in each such other
Lender’s or holder’s Pro Rata Share of the Obligations as would be necessary to
cause such Lender to share the amount so offset or otherwise received with each
other Lender or holder in accordance with their respective Pro Rata Shares,
Each Lender’s obligation under this Section 9.8 shall be in addition to
and not in limitation of its obligations to purchase a participation in an
amount equal to its Pro Rata Share of the Swing Line Loans under Section 1.1.
 Each Credit Party agrees, to the fullest
extent permitted by law, that (a) any Lender may exercise its right to
offset with respect to amounts in excess of its Pro Rata Share of the
Obligations and may sell participations in such amounts so offset to other
Lenders and holders and (b) any Lender so purchasing a participation in
the Loans made or other Obligations held by other Lenders or holders may
exercise all rights of offset, bankers’ lien, counterclaim or similar rights
with respect to such participation as fully as if such Lender or holder were a
direct holder of the Loans and the other Obligations in the amount of such
participation.  Notwithstanding the
foregoing, if all or any portion of the offset amount or payment otherwise
received is thereafter recovered from the Lender that has exercised the right
of offset, the purchase of participations by that Lender shall be rescinded and
the purchase price restored without interest.

 

9.10                           Advances; Payments; Non-Funding Lenders;
Information; Actions in Concert

 

(a)                                 Advances; Payments

 

(i)                                     Revolving Lenders shall refund or participate
in the Swing Line Loan in accordance with clauses (iii) and (iv) of Section 1.l(b).
 If the Swing Line Lender declines to
make a Swing Line Loan or if Swing Line Availability is zero, Agent shall
notify Revolving Lenders, promptly after receipt of a Notice of Revolving
Credit Advance and in any event prior to noon (New York time) on the date such
Notice of Revolving Credit Advance is received, by telecopy, telephone or other
similar form of transmission.  Each
Revolving Lender shall make the amount of such Lender’s Pro Rata Share of each
Revolving Credit Advance available to Agent in same day funds by wire transfer
to Agent’s account as set forth in Annex H not later than 3:00 p.m. (New
York time) on the requested funding date, in the case of an Index Rate Loan,
and not later than 3:00 p.m. (New York time) on the requested funding date
in the case of a LIBOR Loan.  After
receipt of such wire transfers (or, in the Agent’s sole discretion, before
receipt of such wire transfers), subject to the terms hereof, Agent shall make
the requested Revolving Credit Advance to the Borrower designated by Borrower
Representative in the Notice of Revolving Credit Advance.  All payments by each Revolving Lender shall be
made without setoff, counterclaim or deduction of any kind.

 

(ii)                                  On the 2nd Business Day of each calendar week
or more frequently at Agent’s election (each, a “Settlement
Date”), Agent shall advise each Lender by telephone or telecopy of
the amount of such Lender’s Pro Rata Share of principal,

 

 

interest and Fees paid for the benefit of Lenders with respect to each
applicable Loan.  Provided that each
Lender has funded all payments or Advances required to be made by it and
purchased all participations required to be purchased by it under this Agreement
and the other Loan Documents as of such Settlement Date, Agent shall pay to
each Lender such Lender’s Pro Rata Share of principal, interest and Fees paid
by Borrowers since the previous Settlement Date for the benefit of such Lender
on the Loans held by it.  To the extent
that any Lender (a “Non-Funding Lender”) has failed to fund all such payments and Advances or
failed to fund the purchase of all such participations, Agent shall be entitled
to set off the funding short-fall against that Non-Funding Lender’s Pro Rata
Share of all payments received from Borrowers.  Such payments shall be made by wire transfer
to such Lender’s account (as specified by such Lender in Annex H or the
applicable Assignment Agreement) not later than 2:00 p.m. (New York time)
on the next Business Day following each Settlement Date.

 

(b)                                Availability of Lender’s Pro Rata Share

 

Agent may assume that each Revolving Lender will make its Pro Rata
Share of each Revolving Credit Advance available to Agent on each funding date.
 If such Pro Rata Share is not, in fact,
paid to Agent by such Revolving Lender when due, Agent will be entitled to
recover such amount on demand from such Revolving Lender without setoff,
counterclaim or deduction of any kind.  If
any Revolving Lender fails to pay the amount of its Pro Rata Share forthwith
upon Agent’s demand, Agent shall promptly notify Borrower Representative and
Borrowers shall immediately repay such amount to Agent.  Nothing in this Section 9.9(b) or
elsewhere in this Agreement or the other Loan Documents shall be deemed to
require Agent to advance funds on behalf of any Revolving Lender or to relieve
any Revolving Lender from its obligation to fulfill its Commitments hereunder
or to prejudice any rights that Borrowers may have against any Revolving Lender
as a result of any default by such Revolving Lender hereunder.  To the extent that Agent advances funds to any
Borrower on behalf of any Revolving Lender and is not reimbursed therefor on
the same Business Day as such Advance is made, Agent shall be entitled to
retain for its account all interest accrued on such Advance until reimbursed by
the applicable Revolving Lender.

 

(c)                                 Return of Payments

 

(i)                                     If Agent pays an amount to a Lender under
this Agreement in the belief or expectation that a related payment has been or
will be received by Agent from Borrowers and such related payment is not
received by Agent, then Agent will be entitled to recover such amount from such
Lender on demand without setoff, counterclaim or deduction of any kind.

 

(ii)                                  If Agent determines at any time that any
amount received by Agent under this Agreement must be returned to any Borrower
or paid to any other Person

 

 

pursuant to any insolvency law or otherwise, then, notwithstanding any
other term or condition of this Agreement or any other Loan Document, Agent
will not be required to distribute any portion thereof to any Lender.  In addition, each Lender will repay to Agent
on demand any portion of such amount that Agent has distributed to such Lender,
together with interest at such rate, if any, as Agent is required to pay to any
Borrower or such other Person, without setoff, counterclaim or deduction of any
kind.

 

(d)                                 Non-Funding Lenders

 

The failure of any Non-Funding Lender to make any Revolving Credit
Advance or any payment required by it hereunder or to purchase any
participation in any Swing Line Loan to be made or purchased by it on the date
specified therefor shall not relieve any other Lender (each such other
Revolving Lender, an “Other Lender”) of
its obligations to make such Advance or purchase such participation on such
date, but neither any Other Lender nor Agent shall be responsible for the
failure of any Non-Funding Lender to make an Advance, purchase a participation
or make any other payment required hereunder.  Notwithstanding anything set forth herein to
the contrary, a Non-Funding Lender shall not have any voting or consent rights
under or with respect to any Loan Document or constitute a “Lender” or a “Revolving
Lender” (or be included in the calculation of “Requisite Lenders” or “Majority
Revolving Lenders” hereunder) for any voting or consent rights under or with
respect to any Loan Document. At Borrower Representative’s request, Agent or a
Person reasonably acceptable to Agent shall have the right with Agent’s consent
and in Agent’s sole discretion (but shall have no obligation) to purchase from
any Non-Funding Lender, and each Non-Funding Lender agrees that it shall, at
Agent’s request, sell and assign to Agent or such Person, all of the
Commitments of that Non-Funding Lender for an amount equal to the principal
balance of all Loans held by such Non-Funding Lender and all accrued interest
and fees with respect thereto through the date of sale, such purchase and sale to be consummated pursuant
to an executed Assignment Agreement and in accordance with the recording
requirements for transfers in Section 9.1.

 

(e)                                  Dissemination of Information

 

Agent shall use reasonable efforts to provide Lenders with (i) any
notice of Default or Event of Default received by Agent from, or delivered by
Agent to, any Borrower, with notice of any Event of Default of which Agent has
actually become aware and with notice of any action taken by Agent following
any Event of Default; provided, that
Agent shall not be liable to any Lender for any failure to do so, except to the
extent that such failure is attributable solely to Agent’s gross negligence or
willful misconduct as finally determined by a court of competent jurisdiction
and (ii) any Equipment Inventory Appraisals, P&E Appraisals and
Collateral audits received by Agent.  Lenders
acknowledge that Borrowers are required to provide Financial Statements and
Collateral

 

 

Reports to Lenders in accordance with Annexes E and F hereto and agree
that Agent shall have no duty to provide the same to Lenders.

 

(f)                                    Actions in Concert

 

Anything in this Agreement to the contrary notwithstanding, each Lender
hereby agrees with each other Lender that no Lender shall take any action to
protect or enforce its rights arising out of this Agreement or the Notes
(including exercising any rights of setoff) without first obtaining the prior
written consent of Agent and Requisite Lenders, it being the intent of Lenders
that any such action to protect or enforce rights under this Agreement and the
Notes shall be taken in concert and at the direction or with the consent of
Agent or Requisite Lenders.

 

10.       SUCCESSORS AND ASSIGNS

 

10.1                           Successors and Assigns

 

This Agreement and the other Loan Documents shall be binding on and
shall inure to the benefit of each Credit Party, Agent, Lenders and their
respective successors and assigns (including, in the case of any Credit Party,
a debtor-in-possession on behalf of such Credit Party), except as otherwise
provided herein or therein.  No Credit
Party may assign, transfer, hypothecate or otherwise convey its rights,
benefits, obligations or duties hereunder or under any of the other Loan
Documents without the prior express written consent of Agent and Requisite
Lenders.  Any such purported assignment,
transfer, hypothecation or other conveyance by any Credit Party without the
prior express written consent of Agent and Requisite Lenders shall be void.  The terms and provisions of this Agreement are
for the purpose of defining the relative rights and obligations of each Credit
Party, Agent and Lenders with respect to the transactions contemplated hereby
and no Person shall be a third party beneficiary of any of the terms and
provisions of this Agreement or any of the other Loan Documents.

 

11.       MISCELLANEOUS

 

11.1                           Complete Agreement; Modification of Agreement

 

The Loan Documents constitute the complete agreement between the
parties with respect to the subject matter thereof and may not be modified,
altered or amended except as set forth in Section 11.2.  Any letter of interest, commitment letter or
fee letter (other than the GE Capital Fee Letter) or confidentiality agreement,
if any, between any Credit Party and Agent or any Lender or any of their
respective Affiliates, predating this Agreement and relating to a financing of substantially
similar form, purpose or effect shall be superseded by this Agreement.

 

11.2                           Amendments and Waivers

 

(a)                                  Except for actions expressly permitted to be
taken by Agent, no amendment, modification, termination or waiver of any
provision of this Agreement or any other Loan Document, or any consent to any
departure by any Credit Party therefrom, shall in any

 

 

event be effective unless the same shall be in writing and signed by
Agent and Borrowers, and by Requisite Lenders or all affected Lenders, as
applicable.  Except as set forth in
clauses (b) and (c) below, all such amendments, modifications,
terminations or waivers requiring the consent of any Lenders shall require the
written consent of Requisite Lenders.

 

(b)                                 No amendment, modification, termination or
waiver of or consent with respect to any provision of this Agreement that
increases the percentage advance rates set forth in the definition of the Great
Northern Borrowing Base or the H&E Borrowing Base, in each case, above the
Original Advance Rates, shall be effective unless the same shall be in writing
and signed by Agent, Lenders and Borrowers. 
No amendment, modification, termination or waiver of or consent with
respect to any provision of this Agreement that waives compliance with the
conditions precedent set forth in Section 2.2 to the making of any Loan or
the incurrence of any Letter of Credit Obligations, shall be effective unless the
same shall be in writing and signed by Agent, Requisite Lenders and Borrowers.

 

(c)                                  No amendment, modification, termination or
waiver shall, unless in writing and signed by Agent and each Lender directly
affected thereby: (i) increase the principal amount of any Lender’s
Commitment (which action shall be deemed to directly affect all Lenders); (ii) reduce
the principal of, rate of interest on or Fees payable with respect to any Loan
or Letter of Credit Obligations of any affected Lender; (iii) extend any
scheduled payment date (other than payment dates of mandatory prepayments under
Sections 1.3(b)(ii)-and (iii)) or final maturity date of the principal amount
of any Loan of any affected Lender; (iv) waive, forgive, defer, extend or
postpone any payment of interest or Fees payable to any affected Lender, (v) release
any Guaranty or, (vi) except as otherwise permitted herein or in the other
Loan Documents, permit any Credit Party to sell or otherwise dispose of any
Collateral with a value exceeding $5,000,000 in the aggregate (which action
shall be deemed to directly affect all Lenders); (vii) change the
percentage of the Commitments or of the aggregate unpaid principal amount of
the Loans that shall be required for Lenders, or any of them to take any action
hereunder; (viii) amend the definition of Prohibited Swing Line Advance; (ix) change
Section 1.l(b)(i) in any manner that increases the obligations of the
Lenders with respect to any Swing Line Advance, (x) eliminate or make less
restrictive any condition to lending under Section 2.2; or (xi) amend or
waive this Section 11.2 or the definitions of the terms “Requisite Lenders”
or “Majority Revolving Lenders” insofar as such definitions affect the
substance of this Section 11.2.  Furthermore,
no amendment, modification, termination or waiver affecting the rights or
duties of Agent or L/C Issuer under this Agreement or any other Loan Document
shall be effective unless in writing and signed by Agent or L/C Issuer, as the
case may be, in addition to Lenders required hereinabove to take such action.  Each amendment, modification, termination or
waiver shall be effective only in the specific instance and for the specific
purpose for which it was given.  No
amendment, modification, termination or waiver shall be required for Agent to
take additional Collateral pursuant to any Loan Document. No amendment, modification,
termination or

 

 

waiver of any provision of any Note shall be effective without the
written concurrence of the holder of that Note. No notice to or demand on any
Credit Party in any case shall entitle such Credit Party or any other Credit
Party to any other or further notice or demand in similar or other
circumstances.  Any amendment,
modification, termination, waiver or consent effected in accordance with this Section 11.2
shall be binding upon each Lender.

 

(d)                                 If, in connection with any proposed
amendment, modification, waiver or termination (a “Proposed
Change”):

 

(i)                                     requiring the consent of all affected
Lenders, the consent of Requisite Lenders is obtained, but the consent of other
Lenders whose consent is required is not obtained (any such Lender whose
consent is not obtained as described in this clause (i) and in clauses (ii) and
(iii) below being referred to as a “Non-Consenting Lender”),
or

 

(ii)                                  requiring the consent of Requisite Lenders,
the consent of Revolving Lenders holding 51% or more of the aggregate Revolving
Loan Commitments is obtained, but the consent of Requisite Lenders is not
obtained,

 

then, so long as Agent is not a Non-Consenting Lender, at Borrower
Representative’s request, Agent, or a Person reasonably acceptable to Agent,
shall have the right with Agent’s consent and in Agent’s sole discretion (but shall have no
obligation) to purchase from such Non-Consenting Lenders, and such
Non-Consenting Lenders agree that they shall, upon Agent’s request, sell and
assign to Agent or such Person, all of the Commitments of such Non-Consenting
Lenders for an amount equal to the principal balance of all Loans held by the
Non-Consenting Lenders and all accrued interest and Fees with respect thereto
through the date of sale, such purchase and sale to be consummated pursuant to
an executed Assignment Agreement.

 

(e)                                  Upon payment in full in cash and performance
of all of the Obligations (other than Unasserted Contingent Obligations),
termination of the Commitments and all Letters of Credit (or the cash
collateralization or backing with standby letters of credit of all Letters of
Credit in accordance with Annex B) and a release of all claims against Agent
and Lenders, and so long as no suits, actions, proceedings or claims are
pending or threatened against any Indemnified Person asserting any damages,
losses or liabilities that are Indemnified Liabilities, Agent shall deliver to
the Credit Parties payoff letters, termination statements, mortgage releases
and other documents necessary or appropriate to evidence the termination of the
Liens securing payment of the Obligations.

 

11.3                           Fees and Expenses

 

Borrowers shall reimburse (i) Agent and Arranger for all fees,
costs and expenses (including the reasonable fees and expenses of all of its
counsel, advisors, consultants and auditors) and (ii) Agent and Arranger
(and, with respect to clauses (c) and (d) below, all Lenders) for all
fees,

 

 

costs and expenses, including the reasonable fees, costs and expenses
of counsel or other advisors (including environmental and management
consultants and appraisers), incurred in connection with the negotiation and
preparation of the Loan Documents as well as those incurred in connection with:

 

(a)                                  the forwarding to any Borrower or any other
Person on behalf of any Borrower by Agent of the proceeds of any Loan;

 

(b)                                 any amendment, modification or waiver of,
consent with respect to, or termination of, any of the Loan Documents or
Related Transactions Documents or advice in connection with the syndication and
administration of the Loans made pursuant hereto or its rights hereunder or
thereunder;

 

(c)                                  any litigation, contest, dispute, suit,
proceeding or action (whether instituted by Agent, any Lender, any Borrower or
any other Person and whether as a party, witness or otherwise) in any way
relating to the Collateral, any of the Loan Documents or any other agreement to
be executed or delivered in connection herewith or therewith, including any litigation,
contest, dispute, suit, case, proceeding or action, and any appeal or review thereof,
in connection with a case commenced by or against any or all of the Borrowers or
any other Person that may be obligated to Agent by virtue of the Loan
Documents; including any such litigation, contest, dispute, suit, proceeding or
action arising in connection with any work-out or restructuring of the Loans
during the pendency of one or more Events of Default; provided, that in the case of
reimbursement of counsel for Lenders other than Agent, such reimbursement shall
be limited to one counsel for all such Lenders; provided further, that no Person shall be entitled to
reimbursement under this clause (c) in respect of any litigation, contest,
dispute, suit, proceeding or action to the extent any of the foregoing results
from such Person’s gross negligence or willful misconduct;

 

(d)                                 any attempt to enforce any remedies of Agent
or any Lender against any or all of the Credit Parties or any other Person that
may be obligated to Agent or any Lender by virtue of any of the Loan Documents,
including any such attempt to enforce any such remedies in the course of any
work-out or restructuring of the Loans during the pendency of one or more
Events of Default; provided, that
in the case of reimbursement of counsel for Lenders other than Agent, such reimbursement
shall be limited to one counsel for all such Lenders;

 

(e)                                  any workout or restructuring of the Loans
during the pendency of one or more Events of Default; and

 

(f)                                    efforts to (i) monitor the Loans or any
of the other Obligations, (ii) evaluate, observe or assess any Credit
Party or its affairs, and (iii) verify, protect, evaluate, assess,
appraise, collect, sell, liquidate or otherwise dispose of any of the
Collateral in accordance with the terms of the Loan Documents;

 

 

including, as to each of clauses (a) through (f) above, all
reasonable attorneys’ and other professional and service providers’ fees
arising from such services and other advice, assistance or other
representation, including those in connection with any appellate proceedings,
and all expenses, costs, charges and other fees incurred by such counsel and
others in connection with or relating to any of the events or actions described
in this Section 11.3, all of which shall be payable, on demand, by
Borrowers to Agent.  Without limiting the
generality of the foregoing, such expenses, costs, charges and fees may
include: fees, costs and expenses of accountants, environmental advisors,
appraisers, investment bankers, management and other consultants and
paralegals; court costs and expenses; photocopying and duplication expenses;
court reporter fees, costs and expenses; long distance telephone charges; air
express charges; telegram or telecopy charges; secretarial overtime charges;
and expenses for travel, lodging and food paid or incurred in connection with
the performance of such legal or other advisory services.

 

11.4                           No Waiver

 

Agent’s or any Lender’s failure, at any time or times, to require
strict performance by any Credit Party of any provision of this Agreement or
any other Loan Document shall not waive, affect or diminish any right of Agent
or such Lender thereafter to demand strict compliance and performance herewith
or therewith.  Any suspension or waiver
of an Event of Default shall not suspend, waive or affect any other Event of
Default whether the same is prior or subsequent thereto and whether the same or
of a different type.  Subject to the
provisions of Section 11.2, none of the undertakings, agreements,
warranties, covenants and representations of any Credit Party contained in this
Agreement or any of the other Loan Documents and no Default or Event of Default
by any Credit Party shall be deemed to have been suspended or waived by Agent
or any Lender, unless such waiver or suspension is by an instrument in writing
signed by an officer of or other authorized employee of Agent and the
applicable required Lenders and directed to Borrowers specifying such
suspension or waiver.

 

11.5                           Remedies

 

Agent’s and Lenders’ rights and remedies under this Agreement shall be
cumulative and nonexclusive of any other rights and remedies that Agent or any
Lender may have under any other agreement, including the other Loan Documents,
by operation of law or otherwise. Recourse to the Collateral shall riot be
required.

 

11.6                           Severability

 

Wherever possible, each provision of this Agreement and the other Loan
Documents shall be interpreted in such a manner as to be effective and valid
under applicable law, but if any provision of this Agreement or any other Loan
Document shall be prohibited by or invalid under applicable law, such provision
shall be ineffective only to the extent of such prohibition or invalidity
without invalidating the remainder of such provision or the remaining
provisions of this Agreement or such other Loan Document.

 

 

11.7                           Conflict of Terms

 

Except as otherwise
provided in this Agreement or any of the other Loan Documents by specific
reference to the applicable provisions of this Agreement, if any provision
contained in this Agreement conflicts with any provision in any of the other
Loan Documents, the provision contained in this Agreement shall govern and
control.

 

11.8                           Confidentiality

 

Agent and each Lender agree to use commercially reasonable efforts
(equivalent to the efforts Agent or such Lender applies to maintain the confidentiality
of its own confidential information) to maintain as confidential all
confidential information provided to them by any Credit Party and designated as
confidential for a period of two (2) years following receipt thereof,
except that Agent and each Lender may disclose such information (a) to
Persons employed or engaged by Agent or such Lender; (b) to any bona fide
assignee or participant or potential assignee or participant that has agreed to
comply with the covenant contained in this Section 11.8 (and any such bona
fide assignee or participant or potential assignee or participant may disclose
such information to Persons employed or engaged by them as described in clause (a) above);
(c) as required or requested by any Governmental Authority or reasonably
believed by Agent or such Lender to be compelled by any court decree, subpoena
or legal or administrative order or process; (d) as, in the opinion of
Agent’s or such Lender’s counsel, is required by law; (e) in connection
with the exercise of any right or remedy under the Loan Documents or in
connection with any Litigation to which Agent or such Lender is a party; or (f) that
ceases to be confidential through no fault of Agent or any Lender.

 

11.9                           GOVERNING LAW

 

EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN ANY OF THE
LOAN DOCUMENTS, IN ALL RESPECTS, INCLUDING ALL MATTERS OF CONSTRUCTION,
VALIDITY AND PERFORMANCE, THE LOAN DOCUMENTS AND THE OBLIGATIONS SHALL BE
GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE
STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE-AND PERFORMED IN THAT STATE AND
ANY APPLICABLE LAWS OF THE UNITED STATES OF AMERICA.  EACH CREDIT PARTY, AGENT AND LENDERS HEREBY
CONSENT AND AGREE THAT THE STATE OR FEDERAL COURTS LOCATED IN NEW YORK, NEW
YORK SHALL HAVE EXCLUSIVE JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR
DISPUTES BETWEEN ANY CREDIT PARTY, AGENT AND LENDERS PERTAINING TO THIS
AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR TO ANY MATTER ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS, PROVIDED, THAT
AGENT, LENDERS AND CREDIT PARTIES ACKNOWLEDGE THAT ANY APPEALS FROM THOSE
COURTS MAY HAVE TO BE HEARD BY A COURT LOCATED OUTSIDE OF NEW YORK, NEW
YORK AND, PROVIDED, FURTHER NOTHING IN THIS AGREEMENT SHALL

 

 

BE DEEMED OR OPERATE TO PRECLUDE AGENT FROM BRINGING
SUIT OR TAKING OTHER LEGAL ACTION IN ANY OTHER JURISDICTION TO REALIZE ON THE COLLATERAL OR ANY OTHER SECURITY FOR
THE OBLIGATIONS, OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF
AGENT.  EACH CREDIT PARTY, AGENT AND
LENDERS EXPRESSLY SUBMIT AND CONSENT IN ADVANCE
TO SUCH JURISDICTION IN ANY ACTION OR SUIT COMMENCED IN ANY SUCH COURT, AND
EACH CREDIT PARTY, AGENT AND LENDERS HEREBY WAIVE ANY OBJECTION WHICH ANY
CREDIT PARTY, AGENT OR ANY LENDER MAY HAVE BASED UPON LACK OF PERSONAL
JURISDICTION, IMPROPER VENUE
OR FORUM
NON CONVENIENS AND HEREBY CONSENTS TO THE GRANTING OF SUCH LEGAL OR EQUITABLE
RELIEF AS IS DEEMED APPROPRIATE BY SUCH COURT.  EACH CREDIT PARTY HEREBY WAIVES PERSONAL
SERVICE OF THE SUMMONS, COMPLAINT AND OTHER PROCESS ISSUED IN ANY SUCH ACTION OR SUIT AND
AGREES THAT SERVICE OF SUCH
SUMMONS,
COMPLAINTS AND OTHER PROCESS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL
ADDRESSED TO SUCH CREDIT PARTY AT THE ADDRESS SET FORTH IN ANNEX I OF THIS AGREEMENT AND THAT
SERVICE SO MADE
SHALL BE
DEEMED COMPLETED UPON THE EARLIER OF EACH CREDIT PARTY’S ACTUAL RECEIPT THEREOF
OR THREE (3) DAYS AFTER DEPOSIT IN THE U.S. MAILS, PROPER POSTAGE PREPAID.

 

11.10                     Notices

 

Except as otherwise provided herein, whenever it is provided herein
that any notice, demand, request, consent, approval, declaration or other
communication shall or may be given to or served upon any of the parties by any
other parties, or whenever any of the parties desires to give or serve upon any
other parties any communication with respect to this Agreement, each such
notice, demand, request, consent, approval, declaration or other communication
shall be in writing and shall be deemed to have been validly served, given or
delivered (a) upon actual receipt in the case of notice sent by United
States Mail, registered or certified mail, return receipt requested, with
proper postage prepaid, (b) upon transmission, when sent by telecopy or
other similar facsimile transmission (with such telecopy or facsimile promptly
confirmed by delivery of a copy by personal delivery or United States Mail as
otherwise provided in this Section. 11.10), (c) one (1) Business Day
after deposit with a reputable overnight courier with all charges prepaid or (d) when
delivered, if hand-delivered by messenger, all of which shall be addressed to
the party to be notified and sent to the address or facsimile number indicated
in Annex I or to such other address (or facsimile number) as may be substituted
by notice given as herein provided. The giving of any notice required hereunder
may be waived in writing by the party entitled to receive such notice.  Failure or delay in delivering copies of any
notice, demand, request, consent, approval, declaration or other communication
to any Person (other than Borrower Representative or Agent) designated in Annex
I to receive copies shall in no way adversely affect the effectiveness of such
notice, demand, request, consent, approval, declaration or other communication.

 

 

11.11                     Section Titles

 

The Section titles and Table of Contents contained in this
Agreement are and shall be without substantive meaning or content of any kind
whatsoever and are not a part of the agreement between the parties hereto.

 

11.12                     Counterparts

 

This Agreement may be executed in any number of separate counterparts,
each of which shall collectively and separately constitute one agreement.

 

11.13                     WAIVER OF JURY TRIAL

 

BECAUSE DISPUTES ARISING IN CONNECTION WITH COMPLEX
FINANCIAL TRANSACTIONS ARE MOST QUICKLY AND ECONOMICALLY RESOLVED BY AN
EXPERIENCED AND EXPERT PERSON AND THE PARTIES WISH APPLICABLE STATE AND FEDERAL
LAWS TO APPLY (RATHER THAN ARBITRATION RULES), THE PARTIES DESIRE THAT THEIR
DISPUTES BE RESOLVED BY A JUDGE APPLYING SUCH APPLICABLE LAWS.  THEREFORE, TO
ACHIEVE THE BEST COMBINATION OF THE BENEFITS OF THE JUDICIAL SYSTEM AND OF
ARBITRATION, THE PARTIES HERETO WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY ACTION,
SUIT, OR PROCEEDING BROUGHT TO RESOLVE ANY DISPUTE, WHETHER SOUNDING IN
CONTRACT, TORT OR OTHERWISE, AMONG AGENT, LENDERS AND ANY CREDIT PARTY ARISING
OUT OF, CONNECTED WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP
ESTABLISHED AMONG THEM IN CONNECTION WITH, THIS AGREEMENT OR ANY OF THE OTHER
LOAN DOCUMENTS OR THE TRANSACTIONS RELATED THERETO.

 

11.14                     Press Releases and Related Matters

 

Each Credit Party agrees that neither it nor its Affiliates will in the
future issue any press releases or other public disclosure with respect to the
transactions contemplated by this Agreement using the name of GE Capital, any
of the Lenders parties hereto or any of their affiliates or referring to this
Agreement, the other Loan Documents or the Related Transactions Documents
without at least two (2) Business Days’ prior notice to such party and
without the prior written consent of such party unless (and only to the extent
that) such Credit Party or Affiliate is required to do so under law and then,
in any event, such Credit Party or Affiliate will consult with such party
before issuing such press release or other public disclosure.  Each Credit Party consents to the publication
by Agent or any Lender of a
tombstone or similar advertising material relating to the financing
transactions contemplated by this Agreement.  Agent reserves the right to provide to
industry trade organizations information necessary and customary for inclusion
in league table measurements.

 

 

11.15       Reinstatement

 

This Agreement shall remain in full force and
effect and continue to be effective should any petition be filed by or against
any Credit Party for liquidation or reorganization, should any Credit Party
become insolvent or make an assignment for the benefit of any creditor or
creditors or should a receiver or trustee be appointed for all or any
significant part of any Credit Party’s assets, and shall continue to be
effective or to be reinstated, as the case may be, if at any time payment and
performance of the Obligations, or any part thereof, is, pursuant to applicable
law, rescinded or reduced in amount, or must otherwise be restored or returned
by any obligee of the Obligations, whether as a “voidable preference,” “fraudulent
conveyance,” or otherwise, all as though such payment or performance had not
been made. In the event that any payment, or any part thereof, is rescinded,
reduced, restored or returned, the Obligations shall be reinstated and deemed
reduced only by such amount paid and not so rescinded, reduced, restored or
returned.

 

11.16       Advice of Counsel

 

Each of the parties represents to each other
parry hereto that it has discussed this Agreement and, specifically, the
provisions of Sections 11.9 and 11.13, with its counsel.

 

11.17       No Strict Construction

 

The parties hereto have participated jointly in
the negotiation and drafting of this Agreement. In the event an ambiguity or
question of intent or interpretation arises, this Agreement shall be construed
as if drafted jointly by the parties hereto and no presumption or burden of
proof shall arise favoring or disfavoring any party by virtue of the authorship
of any provisions of this Agreement.

 

12.  CROSS-GUARANTY

 

12.1         Cross-Guaranty

 

Each Borrower hereby agrees that such Borrower
is jointly and severally liable for, and hereby absolutely and unconditionally
guarantees to Agent and Lenders and their respective successors and assigns,
the full and prompt payment (whether at stated maturity, by acceleration or otherwise)
and performance of, all Obligations owed or hereafter owing to Agent and
Lenders by each other Borrower, Each Borrower agrees that its guaranty
obligation hereunder is a continuing guaranty of payment and performance and
not of collection, that its obligations under this Section 12 shall not be
discharged until payment and performance, in full, of the Obligations has occurred,
and that its obligations under this Section 12 shall be absolute and
unconditional, irrespective of, and unaffected by:

 

(a)           the genuineness, validity, regularity,
enforceability or any future amendment of, or change in, this Agreement, any
other Loan Document or any other agreement, document or instrument to which any
Borrower is or may become a party;

 

 

(b)           the absence of any action to enforce this
Agreement (including this Section 12) or any other Loan Document or the
waiver or consent by Agent and Lenders with respect to any of the provisions
thereof;

 

(c)           the existence, value or condition of, or
failure to perfect its Lien against, any security for the Obligations or any
action, or the absence of any action, by Agent and Lenders in respect thereof
(including the release of any such security);

 

(d)           the insolvency of any Credit Party; or

 

(e)           any other action or circumstances that might
otherwise constitute a legal or equitable discharge or defense of a surety or
guarantor.

 

Each Borrower shall be regarded, and shall be
in the same position, as principal debtor with respect to the Obligations
guaranteed hereunder.

 

12.2         Waivers by Borrowers

 

Each Borrower expressly waives all rights it
may have now or in the future under any statute, or at common law, or at law or
in equity, or otherwise, to compel Agent or Lenders to marshal assets or to
proceed in respect of the Obligations guaranteed hereunder against any other
Credit Party, any other party or against any security for the payment and
performance of the Obligations before proceeding against, or as a condition to
proceeding against, such Borrower. It is agreed among each Borrower, Agent and Lenders
that the foregoing waivers are of the essence of the transaction contemplated
by this Agreement and the other Loan Documents and that, but for the provisions
of this Section 12 and such waivers, Agent and Lenders would decline to
enter into this Agreement.

 

12.3         Benefit of Guaranty

 

Each Borrower agrees that the provisions of
this Section 12 are for the benefit of Agent and Lenders and their
respective successors, transferees, endorsees and assigns, and nothing herein
contained shall impair, as between any other Borrower and Agent or Lenders, the
obligations of such other Borrower under the Loan Documents.

 

12.4         Subordination of
Subrogation, Etc.

 

Notwithstanding anything to the contrary in
this Agreement or in any other Loan Document, and except as set forth in Section 12.7,
each Borrower hereby expressly and irrevocably subordinates to payment of the
Obligations any and all rights at law or in equity to subrogation,
reimbursement, exoneration, contribution, indemnification or set off and any
and all defenses available to a surety, guarantor or accommodation co-obligor
until the Obligations are indefeasibly paid in full in cash. Each Borrower
acknowledges and agrees that this subordination and waiver is intended to
benefit Agent and Lenders and shall not limit or otherwise affect such Borrower’s
liability hereunder or the enforceability of this Section 12, and that
Agent, Lenders and their respective successors and assigns are intended third
party beneficiaries of the waivers and agreements set forth in this Section 12.4.

 

 

12.5         Election of Remedies

 

If Agent or any Lender may, under applicable
law, proceed to realize its benefits under any of the Loan Documents giving
Agent or such Lender a Lien upon any Collateral, whether owned by any Borrower
or by any other Person, either by judicial foreclosure or by non-judicial sale
or enforcement, Agent or any Lender may, at its sole option, determine which of
its remedies or rights it may pursue without affecting any of its rights and
remedies under this Section 12. If, in the exercise of any of its rights
and remedies, Agent or any Lender shall forfeit any of its rights or remedies,
including its right to enter a deficiency judgment against any Borrower or any
other Person, whether because of any applicable laws pertaining to “election of
remedies” or the like, each Borrower hereby consents to such action by Agent or
such Lender and waives any claim based upon such action, even if such action by
Agent or such Lender shall result in a full or partial loss of any rights of
subrogation that each Borrower might otherwise have had but for such action by
Agent or such Lender. Any election of remedies that results in the denial or
impairment of the right of Agent or any Lender to seek a deficiency judgment
against any Borrower shall not impair any other Borrower’s obligation to pay
the full amount of the Obligations. In the event Agent or any Lender shall bid
at any foreclosure or trustee’s sale or at any private sale permitted by law or
the Loan Documents, Agent or such Lender may bid all or less than the amount of
the Obligations and the amount of such bid need not be paid by Agent or such
Lender but shall be credited against the Obligations. The amount of the
successful bid at any such sale, whether Agent, Lender or any other party is the successful bidder, shall be
conclusively deemed to be the fair market value of the Collateral and the
difference between such bid amount and the remaining balance of the Obligations
shall be conclusively deemed to be the amount of the Obligations guaranteed
under this Section 12, notwithstanding that any present or future law or
court decision or ruling may have the effect of reducing the amount of any
deficiency claim to which Agent or any Lender might otherwise be entitled but
for such bidding at any such sale.

 

12.6         Limitation

 

Notwithstanding any provision herein contained
to the contrary, each Borrower’s liability under this Section 12 (which
liability is in any event in addition to amounts for which such Borrower is
primarily liable under Section 1) shall be limited to an amount not to
exceed as of any date of determination the greater of:

 

(a)           the net amount of all Loans advanced to any
other Borrower under this Agreement and then re-loaned or otherwise transferred
to, or for the benefit of, such Borrower; and

 

(b)           the amount that could be claimed by Agent and Lenders
from such Borrower under this Section 12 without rendering such claim
voidable or avoidable under Section 548 of Chapter 11 of the
Bankruptcy Code or under any applicable state Uniform Fraudulent Transfer Act,
Uniform Fraudulent Conveyance. Act or similar statute or common law after
taking into account, among other things, such Borrower’s right of contribution
and indemnification from each other Borrower under Section 12.7.

 

 

12.7         Contribution with
Respect to Guaranty Obligations

 

(a)           To the extent that any Borrower shall make a
payment under this Section 12 of all or any of the Obligations (other than
Loans made to that Borrower for which it is primarily liable) (a “Guarantor Payment”) that, taking into account all other
Guarantor Payments then previously or concurrently made by any other Borrower,
exceeds the amount that such Borrower would otherwise have paid if each
Borrower had paid the aggregate Obligations satisfied by such Guarantor Payment
in the same proportion that such Borrower’s “Allocable
Amount” (as defined below) (as determined immediately prior to such
Guarantor Payment) bore to the aggregate Allocable Amounts of each of the Borrowers
as determined immediately prior to the making of such Guarantor Payment, then,
following indefeasible payment in full in cash of the Obligations and
termination of the Commitments, such Borrower shall be entitled to receive
contribution and indemnification payments from, and be reimbursed by, each
other Borrower for the amount of such excess, pro
rata based upon their respective Allocable Amounts in effect immediately
prior to such Guarantor Payment.

 

(b)           As of any date of determination, the “Allocable Amount” of any Borrower shall be
equal to the maximum amount of the claim that could then be recovered from such
Borrower under this Section 12 without rendering such claim voidable or
avoidable under Section 548 of Chapter 11 of the Bankruptcy Code or under
any applicable state Uniform Fraudulent Transfer Act, Uniform Fraudulent
Conveyance Act or similar statute or common law.

 

(c)           This Section 12.7 is intended only to
define the relative rights of Borrowers and nothing set forth in this Section 12.7
is intended to or shall impair the obligations of Borrowers, jointly and
severally, to pay any amounts as and when the same shall become due and payable
in accordance with the terms of this Agreement, including Section 12.1.
Nothing contained in this Section 12.7 shall limit the liability of any
Borrower to pay the Loans made directly or indirectly to that Borrower and
accrued interest, Fees and expenses with respect thereto for which such
Borrower shall be primarily liable.

 

(d)           The parties hereto acknowledge that the rights
of contribution and indemnfication hereunder shall constitute assets of the
Borrower to which such contribution and indemnification is owing.

 

(e)           The rights of the indemnifying Borrowers
against other Credit Parties under this Section 12.7 shall be exercisable
upon the full and indefeasible payment in full in cash of the Obligations and
the termination of the Commitments and Letters of Credit (or the cash
collateralization or backing with standby letters of credit of all Letters of
Credit in accordance with Annex B).

 

 

12.8         Liability Cumulative

 

The liability of Borrowers under this Section 12
is in addition to and shall be cumulative with all liabilities of each Borrower
to Agent and Lenders under this Agreement and the other Loan Documents to which
such Borrower is a party or in respect of any Obligations or obligation of the
other Borrower, without any limitation as to amount, unless the instrument or
agreement evidencing or creating such other liability specifically provides to
the contrary.

 

 

IN WITNESS
WHEREOF, this Credit Agreement has been duly executed as of the date first
written above.

 

	
   

  	
  H&E EQUIPMENT SERVICES L.L.C.,

  
	
   

  	
  as Borrower

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  GREAT NORTHERN EQUIPMENT, INC.,

  
	
   

  	
  as Borrower

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  GENERAL ELECTRIC CAPITAL
  CORPORATION,

  
	
   

  	
  as Agent and Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  BANK OF AMERICA, N.A.,

  
	
   

  	
  as Syndication Agent and Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 

	
   

  	
  FLEET CAPITAL CORPORATION,

  
	
   

  	
  as Documentation Agent and Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  PNC BANK, NATIONAL ASSOCIATION,

  
	
   

  	
  as Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  LASALLE BUSINESS CREDIT, INC.,

  
	
   

  	
  as Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  ORIX FINANCIAL SERVICES, INC.,

  
	
   

  	
  as Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 

The following Persons
are signatories to this Credit Agreement in their capacity as Credit Parties
and not as Borrowers:

 

	
   

  	
  H&E HOLDINGS L.L.C.,

  
	
   

  	
  as a Credit Party

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 

	
   

  	
  GNE INVESTMENTS, INC.,

  
	
   

  	
  as a Credit Party

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  	 

	
   

  	
   

  	
  Name:

  	 

	
   

  	
   

  	
  Title:

  	 

	
   

  	
   

  
	
   

  	
  H&E FINANCE CORP.,

  
	
   

  	
  as a Credit Party

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  	 

	
   

  	
   

  	
  Name:

  	 

	
   

  	
   

  	
  Title:

  	 

 

 

EXHIBIT 1.1(a)(i)

 

to

 

CREDIT AGREEMENT

 

FORM OF NOTICE OF REVOLVING CREDIT ADVANCE

 

[H&E EQUIPMENT SERVICES L.L.C./GREAT NORTHERN EQUIPMENT
INC.]

 

Notice of Revolving Credit Advance

 

Capitalized terms used herein which
are defined in the Credit Agreement dated as of June 17, 2002 (as it may be
amended, restated, supplemented or otherwise modified and in effect from time
to time, the “Credit Agreement”) among H&E
EQUIPMENT SERVICES L.L.C., a Louisiana limited liability company (“H&E”), GREAT NORTHERN EQUIPMENT, INC., a Montana
corporation (“Great Northern” and together with
H&E, each individually, a “Borrower”, and
collectively and jointly and severally, the “Borrowers”),
the other persons named therein as Credit Parties, GENERAL ELECTRIC CAPITAL
CORPORATION, as Agent (in such capacity, “Agent”),
GENERAL ELECTRIC CAPITAL CORPORATION as Arranger (in such capacity, “Arranger”), BANK OF AMERICA, N.A. as Syndication Agent and
FLEET CAPITAL CORPORATION as Documentation Agent, shall have the meanings
therein defined. The undersigned hereby certifies that on the date hereof and
on the borrowing date set forth below, and after giving effect to the Advances
requested hereby: (i) there exists and shall exist no Default or Event of
Default under the Credit Agreement; (ii) each of the representations and
warranties contained in the Credit Agreement and the other Loan Documents is
true and correct in all material respects, except to the extent that such
representation or warranty expressly relates to an earlier date and except for
changes therein expressly permitted or expressly contemplated by the Credit
Agreement, (iii) the incurrence of the Revolving Credit Advance hereby
requested is permitted under clause (I) or clause (12) of the definition of “Permitted
Debt” contained Section 4.09 of the Senior Note Indenture and clause (1) or
clause (2) of the definition of “Permitted Debt” contained in Section 4.09
of the Senior Subordinated Note Indenture.

 

	
  [H&E Equipment Services L.L.C./

  	
   

  	
  Name of Contact:

  	
  [                 ]

  	
   

  	
  Phone:

  	
  [                 ]

  
	
  Great Northern Equipment, Inc.]

  	
   

  	
   

  	
   

  	
  Fax::

  	
  [                 ]

  
	
  Address: [                 ]

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bank Address:
  [                 ]

  	
   

  	
  Wire Information:

  	
  [                 ]

  	
   

  	
  ABA#.

  	
  [                 ]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bank Contact:
  [                 ]

  	
   

  	
   

  	
   

  	
  Acct.#:

  	
  [                 ]

  

 

 

We hereby give you notice that, pursuant to the Credit
Agreement and upon the terms and subject to the conditions contained therein,
we wish a Revolving Credit Advance to be made to [H&E Equipment Services
L.L.C. as (i) an H&E/Great Northern Advance         or
(ii) an Advance other than an H&E/Great Northern Advance         [check
which applies], in either case, as follows:

 

 

Request Date                 Index
Rate Loan Amount $                 LIBOR
Loan Amount $                 LIBOR
Period:       months

 

 

The proceeds of this Revolving Credit Advance should
be credited to the above account.

 

Borrower
Representative has caused this request to be executed by its duly Authorized
Officer as of the date and year first written above.

 

	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
   

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  Phone:

  
	
   

  	
   

  
	
   

  	
  Fax:

  

 

 

EXHIBIT 1.1(a)(ii)

to

CREDIT AGREEMENT

 

FORM OF REVOLVING NOTE

 

	
  [              ],
  2002

  	
   

  	
  New York, New York

  
	
   

  	
   

  	
  $                    

  

 

 

FOR VALUE RECEIVED, the undersigned, [H&E
EQUIPMENT SERVICES L.L.C., a Louisiana limited liability company/GREAT NORTHERN
EQUIPMENT, INC., a Montana Corporation] (“Borrower”), HEREBY
PROMISES TO PAY to the order of                                         (“Lender”) at the offices of GENERAL ELECTRIC CAPITAL
CORPORATION, a Delaware corporation, as Agent for Lenders (in such capacity, “Agent”) at its address at 335 Madison Ave., 12th
Floor, New York, NY, 10017, or at such other place as Agent may designate from
time to time in writing, in lawful money of the United States of America and in
immediately available funds, the amount of                     MILLION
DOLLARS AND              CENTS
($                 )
or if less, the aggregate unpaid amount of all Revolving Credit Advances made
to the undersigned under the Credit Agreement (as hereinafter defined). All
capitalized terms used but not otherwise defined herein have the meanings given
to them in the Credit Agreement or in Annex A thereto.

 

This Revolving Note is one of the Revolving Notes
issued pursuant to that certain Credit Agreement dated as of June 17, 2002
(as it may be amended, restated, supplemented or otherwise modified and in
effect from time to time, the “Credit Agreement”)
among Borrower [H&E EQUIPMENT SERVICES L.L.C., a Louisiana limited
liability company,] [GREAT NORTHERN EQUIPMENT, INC., a Montana corporation,]
the other persons named therein as Credit Parties, the lenders party thereto
from time to time (“Lenders”),
Agent, GENERAL ELECTRIC CAPITAL CORPORATION as Arranger (in such capacity, “Arranger”), BANK OF AMERICA, N.A. as Syndication Agent and
FLEET CAPITAL CORPORATION as Documentation Agent, and is entitled to the
benefit and security of the Credit Agreement, the Security Agreements and all
of the other Loan Documents referred to therein. Reference is hereby made to
the Credit Agreement for a statement of all of the terms and conditions under
which the Loans evidenced hereby are made and are to be repaid. The date and
amount of each Revolving Credit Advance made by Lenders to Borrower, the rate
of interest applicable thereto and each payment made on account of the
principal thereof, shall be recorded by Agent on its books; provided that the failure of Agent to make
any such recordation shall not affect the obligations of Borrower to make a
payment when due of any amount owing under the Credit Agreement or this Note in
respect of the Revolving Credit Advances made by Lender to Borrower.

 

The principal amount of the indebtedness evidenced
hereby shall be payable in the amounts and on the dates specified in the Credit
Agreement, the terms of which are hereby incorporated herein by reference.
Interest thereon shall be paid until such principal amount is paid in full at
such interest rates and at such times, and pursuant to such calculations, as
are specified in the Credit Agreement.

 

 

If any payment on this Revolving Note becomes due
and payable on a day other than a Business Day, the maturity thereof shall be
extended to the next succeeding Business Day and, with respect to payments of
principal, interest thereon shall be payable at the then applicable rate during
such extension.

 

Upon and after the occurrence of any Event of
Default, this Revolving Note may, as provided in the Credit Agreement, and
without demand, notice or legal process of any kind, be declared, and
immediately shall become, due and payable.

 

Time is of the essence of this Revolving Note.
Demand, presentment, protest and notice of nonpayment and protest are hereby
waived by Borrower.

 

Except as provided in the Credit Agreement,
this Revolving Note may not be assigned by Lender to any Person.

 

THIS REVOLVING NOTE SHALL BE
GOVERNED BY THE LAWS OF THE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO ITS
CONFLICTS OF LAW RULES WHICH SHALL BE DEEMED NOT TO INCLUDE SECTION 5-1401
OF THE GENERAL OBLIGATIONS LAW OF NEW YORK).

 

[H&E
EQUIPMENT SERVICES L.L.C./GREAT NORTHERN EQUIPMENT INC.]

 

 

	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

 

EXHIBIT 1.1(b)(ii)

to

CREDIT AGREEMENT

 

FORM OF SWING LINE NOTE

 

	
  [              ],
  2002

  	
   

  	
  New York, New York

  
	
   

  	
   

  	
  $                    

  

 

 

FOR VALUE RECEIVED, the undersigned, [H&E
EQUIPMENT SERVICES L.L.C., a Louisiana limited liability company/GREAT NORTHERN
EQUIPMENT, INC., a Montana corporation] (“Borrower”),
HEREBY PROMISES TO PAY to the order of GENERAL ELECTRIC CAPITAL CORPORATION (“Swing Line Lender”), at the offices of GENERAL ELECTRIC
CAPITAL CORPORATION, a Delaware corporation, as Agent for Lenders (in such
capacity, “Agent”) at Agent’s address at 335
Madison Avenue, 12th Floor, New York, NY, 10017, or at such other
place as Agent may designate from time to time in writing, in lawful money of
the United States of America and in immediately available funds, the amount of
              MILLION
DOLLARS AND NO CENTS ($                  )
or if less, the aggregate unpaid amount of all Swing Line Advances made to the
undersigned under the Credit Agreement (as hereinafter defined). All
capitalized terms used but not otherwise defined herein have the meanings given
to them in the Credit Agreement or in Annex A thereto.

 

This Swing Line Note is issued pursuant to that
certain Credit Agreement dated as of June 17, 2002 (as it may be amended,
restated, supplemented or otherwise modified and in effect from time to time,
the “Credit Agreement”) among [H&E
EQUIPMENT SERVICES L.L.C., a Louisiana limited liability company,] [GREAT
NORTHERN EQUIPMENT, INC., a Montana corporation,] the other persons named
therein as Credit Parties, the lenders party thereto from time to time, Agent,
GENERAL ELECTRIC CAPITAL CORPORATION as Arranger (in such capacity, “Arranger”), BANK OF AMERICA, N.A. as Syndication Agent and
FLEET CAPITAL CORPORATION as Documentation Agent, and is entitled to the benefit and security of the
Credit Agreement, the Security Agreements and all of the other Loan Documents.
Reference is hereby made to the Credit Agreement for a statement of all of the
terms and conditions under which the Loans evidenced hereby are made and are to
be repaid. The date and amount of each Swing Line Advance made by Swing Line
Lender to Borrower, the rate of interest applicable thereto and each payment
made on account of the principal thereof, shall be recorded by Agent on its
books; provided that the failure
of Agent to make any such recordation shall not affect the obligations of
Borrower to make a payment when due of any amount owning under the Credit
Agreement or this Swing Line Note in respect of the Swing Line Advances made by
Swing Line Lender to Borrower.

 

The principal amount of the indebtedness evidenced
hereby shall be payable in the amounts and on the dates specified in the Credit
Agreement, the terms of which are hereby incorporated herein by reference.

 

 

Interest thereon shall be paid until such principal
amount is paid in full at such interest rates and at such times, and pursuant
to such calculations, as are specified in the Credit Agreement.

 

If any payment of this Swing Line Note becomes due and
payable on a day other than a Business Day, the maturity thereof shall be
extended to the next succeeding Business Day and, with respect to payments of
principal, interest thereon shall be payable at the then applicable rate during
such extension.

 

Upon and after the occurrence of any Event of Default,
this Swing Line Note may, as provided in the Credit Agreement, and without
demand, notice or legal process of any kind, be declared, and immediately shall
become, due and payable.

 

Time is of the essence of this Swing Line Note.
Demand, presentment, protest and notice of nonpayment and protest are hereby
waived by Borrower.

 

 

THIS SWING LINE NOTE SHALL BE
GOVERNED BY THE LAWS OF THE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO ITS
CONFLICTS OF LAW RULES WHICH SHALL BE DEEMED NOT TO INCLUDE SECTION 5-1401
OF THE GENERAL OBLIGATIONS LAW OF NEW YORK).

 

[H&E EQUIPMENT SERVICES L.L.C./GREAT
NORTHERN EQUIPMENT, INC.]

 

 

	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

 

EXHIBIT 1.5(e)

to

CREDIT AGREEMENT

 

FORM OF NOTICE OF CONVERSION/CONTINUATION

 

Pursuant to Section l.5(e)(i), (ii) and (iv) of
the Credit Agreement (the “Credit Agreement”)
among, inter alia, the
undersigned and General Electric Capital Corporation, as Agent, dated as of June 17,
2002, (defined terms used herein shall have the meanings set forth in the
Credit Agreement), the undersigned hereby requests that the following portions
of the following loans be converted into LIBOR Loans, or continued as a LIBOR
Loan, with the following LIBOR Periods:

 

 

	
  Loan

  	
   

  	
  Amount

  	
   

  	
  LIBOR Period

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  

 

The effective date for these conversions is                ,
2002.

 

[H&E EQUIPMENT SERVICES
L.L.C./GREAT NORTHERN EQUIPMENT, INC.]

 

 

	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

 

EXHIBIT 4.1(b)

 

to

 

CREDIT AGREEMENT

 

FORM OF BORROWING BASE CERTIFICATE

 

Borrowing Base Certificate

 

Pursuant to the Credit Agreement dated as of June 17,
2002 (as it may amended, restated, supplemented or otherwise in effect from
time to time, the “Credit Agreement”)
among H&E EQUIPMENT SERVICES L.L.C., a Louisiana limited liability company
(the “H&E”), GREAT NORTHERN EQUIPMENT,
INC., a Montana corporation (“Great Northern”
and together with H&E, each individually, a “Borrower”,
and collectively and jointly and severally, the “Borrowers”),
the other Persons named therein as Credit Parties, the lenders party thereto
from time to time, GENERAL ELECTRIC CAPITAL CORPORATION, as Agent (in such
capacity, “Agent”), GENERAL ELECTRIC CAPITAL
CORPORATION as Arranger (in such capacity, “Arranger”),
BANK OF AMERICA, N.A, as Syndication Agent and FLEET CAPITAL CORPORATION as
Documentation Agent, the undersigned certifies that as of the close of business
on the date set forth below, the Borrowing Base (as defined in the Credit
Agreement) for H&E and Great Northern are computed as set forth on Schedule I
hereto. Capitalized terms used herein and not otherwise defined herein shall
have the meanings specified in the Credit Agreement or in Annex A thereto.

 

The undersigned represents and warrants that
this Borrowing Base Certificate is a true and correct statement of and that the
information contained herein is true and correct in all material respects
regarding, the status of Eligible Accounts, Eligible Rentals, Eligible Rolling
Stock, Eligible Parts and Tools Inventory and Eligible Equipment Inventory and
that the amounts reflected herein are in compliance with the provisions of the
Credit Agreement and the Appendices thereto. The undersigned further represents
and warrants that there is no Default or Event of Default and all representations
and warranties contained in the Credit Agreement and other Loan Documents are
true and correct in all material respects. The undersigned understands that the
Revolving Lenders will extend loans in reliance upon the information contained
herein. In the event of a conflict between the following summary of eligibility
criteria and Sections 1.6, 1.6A, 1.6B, 1.7 and 1.7A of the Credit Agreement, the
Credit Agreement shall govern.

 

	
  H&E EQUIPMENT SERVICES L.L.C.,

  
	
  as Borrower Representative

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

 

Schedule I

 

	
  Accounts
  Balance (as of
  [        ],
  200[    ])

  	
   

  	
   

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Less:

  	
   

  	
  Contingent or Not Enforceable (§ 1.6(b)):

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Progress billing (§ 1.6(d)):

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Not a Completed Sale (§ 1.6(e)):

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Unacceptable Invoice (§ 1.6(f)):

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Not owned/first lien (§ 1.6(q)):

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Bill and hold (§ 1.6(l)):

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Reps not true (§ 1.6(p)):

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Past Due Cust Accts>90 Days/60 Days (§ 1.6(m)(i)):

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Credit Bal > 90
  Days (Incl In Over 90) (§ 1.6(c)):

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Cross Age > 50%
  (§ 1.6(n)):

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Contra Accounts (§ 1.6(c)) and § 1.6(k)):

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Foreign Accts (§ 1.6(j)):

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Fed Gov Accts (§ 1.6(I)):

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Bankruptcy Accounts (§ 1.6(m)(i) and (iii)):

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Collection Agency/Legal Accts (§ l.6(m)(i)):

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Accts Rec Surplus Returns (§ 1.6(e)):

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Accts Rec Warranty (§ 1.6(e)):

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Cash Sales (§ 1.6(e)):

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Intercompany/Related Party A/R (§ 1.6(h)):

  	
   

  	
  $

  	
   

  	
   

  	
   

  

 

 

	
   

  	
   

  	
  Preassigned A/R (§  1.6(g)):

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Above Credit Limit (§ 1.6(r)):

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Finance Charges (§ 1.6(e)):

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Customers on Payment Plans (§ l.6(m)):

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Credit Memo Reserve (§ l.6(c)):

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Unprocessed Credit Memos (§ 1.6(c)):

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Not in Dollars (§ 1.6(s)):

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Otherwise Not Acceptable (§ 1.6(t)):

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Unapproved Lease (§ 1.6(a)):

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Rental Not Due < 90 days (§ 1.6B(a)):

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  AR For Unpaid Yale Rentals

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  AR For Unpaid OBS Rentals

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  AR PER Inter Creditor Agrmts

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total Ineligible Accounts

  	
   

  	
   

  	
  -

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Eligible Account

  	
   

  	
   

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  85% of Eligible Accounts

  	
   

  	
   

  	
  A

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Eligible
  Rolling Stock Balance (as of [      ], 200[  ])

  	
   

  	
   

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Less:

  	
   

  	
  Free and Clear Rolling Stock:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Location Rolling Stock:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Titled Rolling Stock:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Excess, obsolete, damaged Rolling Stock:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Sale or Lease Rolling Stock:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Prior Liens:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Untrue Representations and Warranties:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Uninsured:

  	
   

  	
  $

  	
   

  	
   

  	
   

  

 

 

	
   

  	
   

  	
  Unacceptable Rolling Stock:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total Ineligible Rolling Stock

  	
   

  	
   

  	
  -

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Eligible Rolling Stock

  	
   

  	
   

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  50% of
  the Orderly Liquidation Value (“OLV”) of Rolling Stock

  	
   

  	
   

  	
  B

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Parts and
  Tools Inventory (“PTI”) Balance (as of [    ],
  200[  ])

  	
   

  	
   

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Less:

  	
   

  	
  Free and Clear PTI:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Location PTI:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Consignment, in Transit:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Negotiable Document of Title:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Excess, obsolete, unsalable or damaged PTI:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Display items, etc.:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Not held for sale:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Prior Liens:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Untrue Representations and Warranties:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Hazardous Materials, etc.:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Uninsured:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Unacceptable PTI:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total Ineligible Parts and Tools Inventory

  	
   

  	
   

  	
  -

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Eligible Parts and Tools Inventory

  	
   

  	
   

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Net Book Value (“NBV”) of
  Eligible Parts and Tools Inventory

  	
   

  	
   

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  50% of
  NBV of Eligible Parts and Tools Inventory

  	
   

  	
   

  	
  C

  	
  $

  	
   

  
										

 

 

	
  Eligible
  new Equipment Inventory (“new EI”) Balance (as of [    ],
  200[    ])

  	
   

  	
   

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Less:

  	
   

  	
  Free and Clear new EI:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Location new EI:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Consignment:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Negotiable Document of Title:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Obsolete, unsalable or damaged new EI:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Not held for sale:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Prior Liens:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Untrue Representations and Warranties:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Uninsured:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Unacceptable new EI:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total Ineligible new Equipment Inventory

  	
   

  	
   

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Eligible new Equipment Inventory

  	
   

  	
   

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  NBV of Eligible new Equipment Inventory

  	
   

  	
   

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  100% of
  NBV of Eligible new Equipment Inventory

  	
   

  	
   

  	
  D

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Eligible
  used Equipment Inventory (“used EI”) Balance

  (as of [    ], 200[    ])

  	
   

  	
   

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Less:

  	
   

  	
  Free and Clear used EI:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Location used EI:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Consignment:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Negotiable Document of Title:

  	
   

  	
  $

  	
   

  	
   

  	
   

  

 

 

	
   

  	
   

  	
  Obsolete, unsalable or damaged used EI:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Not held for sale:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Prior Liens:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Untrue Representations and Warranties:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Uninsured:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Unacceptable used EI:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total Ineligible used Equipment Inventory

  	
   

  	
   

  	
  -

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Eligible used Equipment Inventory

  	
   

  	
   

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  NBV of Eligible used Equipment Inventory

  	
   

  	
   

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  50% of
  NBV of Eligible used Equipment Inventory

  	
   

  	
   

  	
  E

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Eligible
  Equipment Inventory held for lease (“lease EI”) Balance

  (as of [    ], 200[    ])

  	
   

  	
   

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Less:

  	
   

  	
  Free and Clear lease EI:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Location lease EI:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Consignment:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Negotiable Document of Title:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Obsolete, unsalable or damaged lease EI:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Not held for sale:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Prior Liens:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Untrue Representations and Warranties:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Uninsured;

  	
   

  	
  $

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Unacceptable lease EI:

  	
   

  	
  $

  	
   

  	
   

  	
   

  
										

 

 

	
  Total Ineligible Equipment Inventory held for lease

  	
   

  	
   

  	
  -

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Eligible Equipment Inventory held for lease

  	
   

  	
   

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  100% of NBV of Eligible Equipment Inventory held for
  lease

  	
   

  	
   

  	
  -

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  80% of OLV Equipment Inventory held for lease

  	
   

  	
   

  	
  -

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Available
  Equipment Inventory.

  	
   

  	
  (lesser of X and Y)

  	
   

  	
   

  	
  F

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Borrowing
  Base availability

  	
   

  	
  (A+B+C+D+E+F)

  	
   

  	
   

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Termination
  Value of Hedging Obligations (for consideration of Reserves)

  	
   

  	
   

  	
   

  	
  $

  	
   

  

 

 

EXHIBIT 9.1(a)

to

CREDIT
AGREEMENT

 

FORM OF
ASSIGNMENT AGREEMENT

 

THIS ASSIGNMENT AGREEMENT is made as of [                    ],
2002 (this “Agreement”) by and between [                           ]
(“Assignor Lender”) and [                           ]
(“Assignee Lender”) and acknowledged and
consented to by GENERAL ELECTRIC CAPITAL CORPORATION as Agent under the Credit
Agreement defined below (in such capacity, “Agent”) and,
if no Default or Event of Default shall have occurred and be continuing, or if
such assignment is not to a Qualified Assignor (as such term is defined in the
Credit Agreement), H&E EQUIPMENT SERVICES L.L.C. (“H&E”)
as Borrower Representative under the Credit Agreement (“Borrower Representative”).
All capitalized terms used in this Agreement and not otherwise defined herein
will have the respective meanings set forth in the Credit Agreement or in Annex
A thereto.

 

WHEREAS:

 

(A)          H&E, Great Northern Equipment, Inc. (“Great Northern” and together with H&E each
individually, a “Borrower”, and collectively and
jointly and severally, the “Borrowers”),
the other Persons named therein as Credit Parties, Agent, Assignor Lender,
General Electric Capital Corporation as Arranger, BANK OF AMERICA, N.A. as
Syndication Agent, FLEET CAPITAL CORPORATION as Documentation Agent and other
Persons party thereto as Lenders have entered into that certain Credit
Agreement dated as of June 17, 2002 (as it may be amended, restated,
supplemented or otherwise modified and in effect from time to time, the “Credit Agreement”) pursuant to which Assignor Lender has
agreed to make certain Loans to, and incur certain Letter of Credit Obligations
for, Borrowers;

 

(B)          Assignor Lender desires to assign to Assignee
Lender [all/a portion] of its interest in the Loans (as described below), the
Letter of Credit Obligations and the Collateral and to delegate to Assignee
Lender [all/a portion] of its Commitments and other duties with respect to such
Loans, Letter of Credit Obligations and Collateral;

 

(C)          Assignee Lender desires to become a Lender
under the Credit Agreement and to accept such assignment and delegation from
Assignor Lender; and

 

(D)          Assignee Lender desires to appoint Agent to
serve as agent for Assignee Lender under the Credit Agreement.

 

NOW, THEREFORE, in consideration of
the premises and the agreements, provisions, and covenants herein contained,
Assignor Lender and Assignee Lender agree as follows:

 

 

1.  ASSIGNMENT, DELEGATION AND ACCEPTANCE

 

1.1           Assignment

 

Assignor Lender hereby transfers and assigns to
Assignee Lender, without recourse and without representations or warranties of
any kind (except as set forth in Section 3.2), [all/such percentage] of
Assignor Lender’s right, title, and interest in the Revolving Loan, Letter of
Credit Obligations, Loan Documents and Collateral as will result in Assignee
Lender having as of the Effective Date (as hereinafter defined) a Pro Rata
Share thereof, as follows:

 

	
  Assignee Lender’s Loans

  	
   

  	
  Principal Amount

  	
   

  	
  Pro Rata Share

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Revolving Loan (H&E)

  	
   

  	
  $

  	
  [             

  	
  ]

  	
  [       

  	
  ]%

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Revolving Loan (Great Northern)

  	
   

  	
  $

  	
  [             

  	
  ]

  	
  [       

  	
  ]%

  

 

1.2           Delegation

 

[Assignor Lender hereby irrevocably assigns and
delegates to Assignee Lender [all/a portion] of its Commitments and its other
duties and obligations as a Lender under the Loan Documents equivalent to
[100%/[       ]% of Assignor Lender’s
Revolving Loan Commitment to H&E (such percentage representing a commitment
of $[                  ])
and [100%/[       ]%] of Assignor Lender’s
Revolving Loan Commitment to Great Northern (such percentage representing a
commitment of $[                  ]).]

 

1.3           Acceptance by Assignee Lender

 

By its execution of this Agreement, Assignee
Lender irrevocably purchases, assumes and accepts such assignment and
delegation and agrees to be a Lender with respect to the delegated interest
under the Loan Documents and to be bound by the terms and conditions thereof.
By its execution of this Agreement, Assignor Lender agrees, to the extent
provided herein, to relinquish its rights and be released from its obligations
and duties under the Credit Agreement.

 

1.4           Effective Date

 

Such assignment and delegation by Assignor
Lender and acceptance by Assignee Lender will be effective and Assignee Lender
will become a Lender under the Loan Documents as of the date of this Agreement (“Effective
Date”) and upon
payment of the Assigned Amount and the Assignment Fee (as each term is
defined below). Interest and Fees accrued prior to the Effective Date are for
the account of Assignor Lender, and Interest and Fees accrued from and after
the Effective Date are for the account of Assignee Lender.

 

2.  INITIAL PAYMENT AND DELIVERY OF NOTES.

 

2.1           Payment of the
Assigned Amount

 

Assignee Lender will pay to Assignor Lender, in
immediately available funds, not later than 12:00 noon (New York time) on the
Effective Date, an amount equal to its Pro Rata Share of the then

 

 

outstanding principal amount of the Loans as
set forth above in Section 1.1 together with accrued interest, fees and
other amounts as set forth on Schedule 2.1 (the “Assigned
Amount”).

 

2.2           Payment of Assignment Fee

 

Assignor Lender and/or Assignee Lender will pay
to Agent, for its own account in immediately available funds, not later than
12:00 noon (New York time) on the Effective Date, the assignment fee in the
amount of $3,500 (the “Assignment Fee”)
as required pursuant to Section 9.1(a) of the Credit Agreement.

 

2.3           Execution and
Delivery of Notes

 

Following payment of the Assigned Amount and
the Assignment Fee, Assignor Lender will deliver to Agent the Notes previously
delivered to Assignor Lender for redelivery to Borrower and Agent will obtain
from Borrower for delivery to [Assignor Lender and] Assignee Lender, new
executed Notes evidencing Assignee Lender’s [and Assignor Lender’s respective]
Pro Rata Share[s] in the Loans after giving effect to the assignment described
in Section 1. Each new Note will be issued in the aggregate maximum
principal amount of the [applicable] Commitment [of the Lender to whom such
Note is issued] or [the Assignee Lender].

 

3.  REPRESENTATIONS, WARRANTIES AND COVENANTS

 

3.1           Assignee Lender’s Representations, Warranties and
Covenants

 

Assignee Lender hereby represents, warrants,
and covenants the following to Assignor Lender and Agent:

 

(a)           this Agreement is a legal, valid, and binding
agreement of Assignee Lender, enforceable according to its terms;

 

(b)           the execution and performance by Assignee
Lender of its duties and obligations under this Agreement and the Loan
Documents will not require any registration with, notice to, or consent or
approval by any Governmental Authority;

 

(c)           Assignee Lender is familiar with transactions
of the kind and scope reflected in the Loan Documents and in this Agreement;

 

(d)           Assignee Lender has made its own independent
investigation and appraisal of the financial condition and affairs of each
Credit Party, has conducted its own evaluation of the Loans and Letter of
Credit Obligations, the Loan Documents and each Credit Party’s
creditworthiness, has made its decision to become a Lender to Borrowers under
the Credit Agreement independently and without reliance upon Assignor Lender or
Agent, and will continue to do so;

 

(e)           Assignee Lender is entering into (his Agreement
in the ordinary course of its business, and is acquiring its interest, in the
Loans and Letter of Credit Obligations for its own account and not with a view
to or for sale in connection with any subsequent distribution; provided, however, that at all times the distribution
of Assignee Lender’s property shall, subject to the terms of the Credit
Agreement, be and remain within its control;

 

 

(f)            no future assignment
or participation granted by Assignee Lender pursuant to Section 9.1 of the
Credit Agreement will require Assignor Lender, Agent, or Borrower to file any registration
statement with the Securities and Exchange Commission or to apply to qualify
under the blue sky laws of any state;

 

(g)           Assignee Lender has no loans to, written or
oral agreements with, or equity or other ownership interest in any Credit
Party;

 

(h)           Assignee Lender will not enter into any written
or oral agreement with, or acquire any equity or other ownership interest in,
any Credit Party without the prior written consent of Agent; and

 

(i)            as of the Effective
Date, Assignee Lender (i) is entitled to receive payments of principal and
interest in respect of the Obligations without deduction for or on account of
any Taxes, and simultaneously herewith Assignee Lender is delivering to Agent
and Borrower all forms required to be delivered by it pursuant to Section 1.15
of the Credit Agreement, (ii) is not subject to capital adequacy or
similar requirements under Section 1.16(a) of the Credit Agreement, (iii) does
not require the payment of any increased costs under Section 1.16(a) or
(b) of the Credit Agreement, and (iv) is not unable to fund LIBOR
Loans under Section 1.16(c) of the Credit Agreement, and Assignee
Lender will indemnify Agent from and against all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, or expenses that
result from Assignee Lender’s failure to fulfill its obligations under the
terms of Section 1.16(c) of the Credit Agreement or from any other
inaccuracy in the foregoing.

 

3.2           Assignor Lender’s Representations, Warranties and
Covenants

 

Assignor Lender hereby represents, warrants and
covenants the following to Assignee Lender:

 

(a)           Assignor Lender is the legal and beneficial
owner of the Assigned Amount;

 

(b)           this Agreement is a legal, valid and binding
agreement of Assignor Lender, enforceable according to its terms;

 

(c)           the execution and performance by Assignor Lender
of its duties and obligations under this Agreement and the Loan Documents will
not require any registration with, notice to or consent or approval by any
Governmental Authority;

 

 

(d)           Assignor Lender has full power and authority,
and has taken all action necessary to execute and deliver this Agreement and to
fulfil the obligations hereunder and to consummate the transactions
contemplated hereby;

 

(e)           Assignor Lender is the legal and beneficial
owner of the interests being assigned hereby, free and clear of any adverse
claim, lien, encumbrance, security interest, restriction on transfer, purchase
option, call or similar right of a third party; and

 

(f)            this Assignment by
Assignor Lender to Assignee Lender complies, in all material respects, with the
terms of the Loan Documents.

 

 

4.  LIMITATIONS OF LIABILITY

 

Neither Assignor Lender (except as provided in Section 3.2)
nor Agent makes any representations or warranties of any kind, nor assumes any
responsibility or liability whatsoever, with regard to (a) the Loan
Documents or any other document or instrument furnished pursuant thereto or the
Loans, Letter of Credit Obligations or other Obligations, (b) the
creation, validity, genuineness, enforceability, sufficiency, value or
collectibility of any of them, (c) the amount, value or existence of the
Collateral, (d) the perfection or priority of any Lien upon the
Collateral, or (e) the financial condition of any Credit Party or other
obligor or the performance or observance by any Credit Party of its obligations
under any of the Loan Documents. Neither Assignor Lender nor Agent has or will
have any duty, either initially or on a continuing basis, to make any
investigation, evaluation, appraisal of, or any responsibility or liability
with respect to the accuracy or completeness of, any information provided to
Assignee Lender which has been provided to Assignor Lender or Agent by any Credit
Party. Nothing in this Agreement or in the Loan Documents shall impose upon the
Assignor Lender or Agent any fiduciary relationship in respect of the Assignee
Lender.

 

5.  FAILURE TO ENFORCE

 

No failure or delay on the part of Agent or
Assignor Lender in the exercise of any power, right, or privilege hereunder or
under any Loan Document will impair such power, right, or privilege or be
construed to be a waiver of any default or acquiescence therein. No single or
partial exercise of any such power, right, or privilege will preclude further
exercise thereof or of any other right, power, or privilege. All rights and
remedies existing under this Agreement are cumulative with, and not exclusive
of, any rights or remedies otherwise available.

 

6.  NOTICES

 

Unless otherwise specifically provided herein,
any notice or other communication required or permitted to be given will be in
writing and addressed to the respective party as set forth below its signature
hereunder, or to such other address as the party may designate in writing to
the other.

 

7.  AMENDMENTS AND WAIVERS

 

No amendment, modification, termination, or
waiver of any provision of this Agreement will be effective without the written
concurrence of Assignor Lender, Agent and Assignee Lender. 

 

8.  SEVERABILITY

 

Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and valid under
applicable law. In the event any provision of this Agreement is or is held to
be invalid, illegal, or unenforceable under applicable law, such provision will
be ineffective only to the extent of such invalidity, illegality, or
unenforceability, without invalidating the remainder of such provision or the
remaining provisions of the Agreement. In addition, in the event any provision
of or obligation under this Agreement is or is held to be invalid, illegal, or
unenforceable in any jurisdiction, the validity, legality, and enforceability
of the remaining

 

 

provisions or obligations in any other
jurisdictions will not in any way be affected or impaired thereby.

 

9.  SECTION TITLES

 

Section and Subsection titles in this
Agreement are included for convenience of reference only, do not constitute a
part of this Agreement for any other purpose, and have no substantive effect.

 

10.  SUCCESSORS AND ASSIGNS

 

This Agreement shall be binding upon and inure
to the benefit of the parties hereto and their respective successors and
assigns.

 

11.  APPLICABLE LAW

 

THIS AGREEMENT WILL BE CONSTRUED IN ACCORDANCE
WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS
MADE AND PERFORMED IN THAT STATE.

 

12.  COUNTERPARTS

 

This Agreement and any amendments, waivers,
consents, or supplements may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which, when so
executed and delivered, will be deemed an original and all of which shall
together constitute one and the same instrument.

 

IN WITNESS WHEREOF, this Agreement has
been duly executed as of the date first written above.

 

	
  ASSIGNEE LENDER:

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Notice Address:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  
	
  ASSIGNOR LENDER:

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  

 

 

	
   

  	
  Notice Address:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  

 

 

	
  ACKNOWLEDGED AND CONSENTED TO:

  
	
   

  
	
  GENERAL ELECTRIC CAPITAL CORPORATION,

  
	
   

  
	
  as Agent

  
	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  ACKNOWLEDGED AND CONSENTED TO as
  and when required under Clause 9.1(a) of the Credit Agreement:

  
	
   

  
	
  H&E EQUIPMENT SERVICES L.L.C.,

  
	
   

  
	
  as Borrower Representative

  
	
   

  
	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  

 

 

SCHEDULE 2.1

 

	
  Assignor
  Lender’s Loans

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Principal Amount

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Revolving Loan (H&E)

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Revolving Loan (Great
  Northern)

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Subtotal

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Accrued Interest

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Unused Line Fee

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Other + or -

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total

  	
   

  	
  $

  	
   

  

 

All determined as of the
Effective Date.

 

 

EXHIBIT B-l(a)

 

to

 

CREDIT
AGREEMENT

 

FORM OF
NOTICE OF LETTER OF CREDIT ISSUANCE

 

[H&E
EQUIPMENT SERVICES, L.L.C./GREAT NORTHERN EQUIPMENT INC.]

 

Notice of
Letter of Credit Issuance

 

	
  General Electric Capital
  Corporation, as Agent under the Credit Agreement defined below

  	
                                   

  	
  , 200[  ]

  

 

 

Ladies and Gentlemen:

 

We hereby refer to the Credit Agreement dated as of June [  ], 2002 (as it may be amended, restated,
supplemented or otherwise modified and in effect from time to time, the “Credit Agreement”) among H&E EQUIPMENT SERVICES,
L.L.C., a Delaware limited liability company (“H&E”),
GREAT NORTHERN EQUIPMENT INC., a Montana corporation (“Great
Northern” and together with H&E, each individually, a “Borrower”, and collectively and jointly and severally, the “Borrowers”), the other persons named therein as Credit
Parties, GENERAL ELECTRIC CAPITAL CORPORATION, as Agent (in such capacity, “Agent”), GENERAL ELECTRIC CAPITAL CORPORATION, as Arranger
(in such capacity, “Arranger”),
BANK OF AMERICA, N.A. as Syndication Agent and FLEET CAPITAL as Documentation
Agent. Capitalized terms used in the Credit Agreement, and Annex A thereto,
shall have the meanings therein defined.

 

We hereby give you notice that, pursuant to the Credit Agreement and
upon the terms and subject to the conditions contained therein, we wish a
Letter of Credit to be issued to [H&E Equipment Services, L.L.C./Great
Northern Equipment Inc.] on              ,
200[  ]. The undersigned hereby certifies that on the date hereof and
on the date of the issuance of the Letter of Credit, the issuance of the Letter
of Credit

 

 

hereby requested is permitted under clause (1) or clause (12) of the
definition of “Permitted Debt” as contained in the Senior Note Indenture.

 

 

	
  Very truly yours,

  
	
   

  
	
   

  
	
  H&E EQUIPMENT
  SERVICES, L.L.C.,

  
	
   

  
	
  as Borrower Representative

  
	
   

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

ANNEX A
(Recitals)

to

CREDIT AGREEMENT

DEFINITIONS

 

Capitalized terms used in the Loan Documents shall have (unless
otherwise provided elsewhere in the Loan Documents) the following respective
meanings, and all references to Sections, Exhibits, Schedules or Annexes in the
following definitions shall refer to Sections, Exhibits, Schedules or Annexes
of or to the Agreement:

 

“A Rated Bank” has the meaning assigned to it in
Section 6.2.

 

“Account Debtor”
means any Person who may become obligated to a Credit Party under, with respect
to, or on account of, an Account, Chattel Paper or General Intangibles (including
a payment intangible).

 

“Accounting Changes” has the meaning assigned to it in Annex G.

 

“Accounts”
means all “accounts,” as such term is defined in
the Code, now owned or hereafter acquired by any Credit Party including
(a) all accounts receivable, other receivables, book debts and other forms
of obligations (other than forms of obligations evidenced by Chattel Paper, or
Instruments), (including any such obligations that may be characterized as an
account or contract right under the Code), (b) all of each Credit Party’s
rights in, to and under all purchase orders or receipts for goods or services,
(c) all of each Credit Party’s rights to any goods represented by any of
the foregoing (including unpaid sellers’ rights of rescission, replevin,
reclamation and stoppage in transit and rights to returned, reclaimed or
repossessed goods), (d) all rights to payment due to any Credit Party for
property sold, leased, licensed, assigned or otherwise disposed of, for a
policy of insurance issued or to be issued, for a secondary obligation incurred
or to be incurred, for energy provided or to be provided, for the use or hire
of a vessel under a charter or other contract, arising out of the use of a
credit card or charge card, or for services rendered or to be rendered by such
Credit Party or in connection with any other transaction (whether or not yet
earned by performance on the part of such Credit Party), (e) all health
care insurance receivables and (f) all collateral security of any kind,
given by any Account Debtor or any other Person with respect to any of the
foregoing.

 

“Adjusted Interest Coverage
Ratio” means, with respect to H&E Holdings and
its Subsidiaries on a consolidated basis for any period, the ratio of
(a) EBITDAR to (b) (i) Interest Expense plus (ii) Operating
Lease Payments plus (iii) Capital Lease Payments plus, to the extent not already included under sub
clause (i), (ii) or (iii) of this clause (b), Restricted Payments.
For the purposes of this definition, Interest Expense for the Fiscal Quarters
ending on September 30, 2001, December 31, 2001, and March 31,
2002 shall be deemed to be $8,600,000 for each such Fiscal Quarter.

 

A-1

 

“Adjusted Leverage Ratio” means, with respect to H&E Holdings and its Subsidiaries, on a
consolidated basis, the ratio of (i) Funded Debt as of any date of
determination plus Operating Lease Payoff Value, to (ii) EBITDAR
for the period of four consecutive Fiscal Quarters ending on that date of
determination.

 

“Advance”
means any Revolving Credit Advance or Swing Line Advance, as the context may
require.

 

“Affiliate”
means, with respect to any Person, (a) each Person that, directly or
indirectly, owns or controls, whether beneficially, or as a trustee, guardian
or other fiduciary, ten percent (10%) or more of the Stock having ordinary
voting power in the election of directors of such Person, (b) each Person that
controls, is controlled by or is under common control with such Person, (c) each
of such Person’s officers, directors, joint venturers and partners and
(d) in the case of any Credit Party, the immediate family members, spouses
and lineal descendants of individuals who are Affiliates of such Credit
Party.  For the purposes of this
definition, “control” of a Person means the possession, directly or indirectly,
of the power to direct or cause the direction of its management or policies,
whether through the ownership of voting securities, by contract or otherwise; provided, that the term “Affiliate” shall
specifically include Don Wheeler and John Engquist and exclude Agent and each
Lender.

 

“Agent” means
GE Capital in its capacity as Administrative Agent for Lenders or its successor
appointed pursuant to Section 9.7.

 

“Aggregate Borrowing Base” means, as of any date of determination, an amount equal to the sum of
the Great Northern Borrowing Base and the H&E Borrowing Base.

 

“Agreement”
means the Credit Agreement by and among the Credit Parties party thereto, GE
Capital, as Arranger, GE Capital, as Administrative Agent and Lender and the
other Lenders from time to time party thereto, as the same may be amended,
supplemented, amended and restated or otherwise modified from time to time.

 

“Appendices”
has the meaning assigned to it in the recitals to the Agreement.

 

“Applicable L/C Margin” means the per annum fee, from time to time in effect, payable with
respect to outstanding Letter of Credit Obligations as determined by reference
to Section 1.5(a).

 

“Applicable Margins” means collectively the Applicable L/C Margin, the Applicable Unused
Line Fee Margin, the Applicable Revolver Index Margin and the Applicable
Revolver LIBOR Margin all as set forth in Section 1.5(a).

 

“Applicable Revolver Index Margin” means the per annum interest rate margin
from time to time in effect and payable in addition to the Index Rate
applicable to the Revolving Credit Advances, the Swingline Advances,
unreimbursed Letter of Credit Obligations and other Obligations (excluding
LIBOR Loans) as determined by reference to Section 1.5(a).

 

A-2

 

“Applicable Revolver LIBOR Margin” means the per annum interest rate from time
to time in effect and payable in addition to the LIBOR Rate applicable to LIBOR
Loans, as determined by reference to Section 1.5(a).

 

“Applicable Unused Line Fee Margin” means the per annum fee, from time to time
in effect, payable in respect of Borrowers’ non-use of committed funds pursuant
to Section 1.9(b), which fee is determined by reference to
Section 1.5(a).

 

“Arranger”
has the meaning assigned to it in the recitals to the Agreement.

 

“Assignment Agreement” has the meaning assigned to it in Section 9. l(a).

 

“Authorized Officer” means any of the following officers of each Credit Party: the chief
executive officer, the chief operating officer, the chief financial officer,
executive vice president, the secretary and the treasurer.

 

“Bankruptcy Code” means the provisions of Title 11 of the United States Code, 11 U.S.C.
§§ 101 et seq.

 

“Authorized Representative” has the meaning assigned to it in Section 7.3.

 

“Blocked Account Agreement” has the meaning assigned to it in Annex C.

 

“Blocked Accounts” has the meaning assigned to it in Annex C.

 

“Borrower”
has the meaning assigned to it in the preamble to the Agreement.

 

“Borrower Representative” means H&E in its capacity as Borrower Representative pursuant to
the provisions of Section 1.1(c).

 

“Borrowing Availability” means as of any date of determination (a) as to all Borrowers,
the lesser of (i) the Maximum Amount and (ii) the Aggregate Borrowing
Base, in each case, less the sum of the aggregate Revolving Loan and
Swing Line Loan then outstanding, or (b) as to an individual Borrower, the
lesser of (i) the Maximum Amount less the sum of the Revolving Loan
and Swing Line Loan outstanding to all other Borrowers and (ii) that
Borrower’s separate Borrowing Base, less the sum of the Revolving Loan
and Swing Line Loan outstanding to that Borrower, provided, that in the case of determining Borrowing
Availability under this clause (b), with respect to any requested H&E/Great
Northern Advance, “such Borrower’s separate Borrowing Base” shall mean the
Great Northern Borrowing Base.

 

“Borrowing Base”
means, as the context may require, the H&E Borrowing Base, the Great
Northern Borrowing Base or the Aggregate Borrowing Base.

 

“Borrowing Base Certificate” means a certificate to be executed and delivered from time to time by
Borrower Representative on behalf of each Borrower in the form attached to the
Agreement as Exhibit 4.1(b).

 

A-3

 

“BRS” means collectively Bruckmann, Rosser,
Sherrill & Co., L.P., a Delaware limited partnership, BRS Partners, LP
and BRSE LLP.

 

“BRS Management Agreement” has the meaning assigned to it in
Section 3.14.

 

“BRS Management Co.” has the meaning assigned to it in
Section 3.14.

 

“BRS Related Party” means (1) any stockholder having more
than 5% of any class of stock of any entity that comprises BRS, any individual
controlling any such stockholder, any immediate family member of any such
stockholder (if an individual) or of any such individual and any majority owned
Subsidiary, of BRS; or (2) any trust, corporation, partnership or other entity,
the beneficiaries, stockholders, partners, owners or Persons beneficially holding
a majority interest of any of the entities that comprise BRS and/or such other
Persons referred to in the immediately preceding clause (1).

 

“Business Day” means any day that is not a Saturday, a
Sunday or a day on which banks are required or permitted to be closed in the
State of [Utah] or the State of New York and in reference to LIBOR Loans means
any such day that is also a LIBOR Business Day.

 

“Capital Lease” means, with respect to any Person, any lease
of any property (whether real, personal or mixed) by such Person as lessee
that, in accordance with GAAP, would be required to be classified and accounted
for as a capital lease on a balance sheet of such Person.

 

“Capital Lease Obligation” means as of any date of determination, with
respect to any Capital Lease of any Person, the amount of the obligation of the
lessee thereunder that, in accordance with GAAP, would appear on a balance
sheet of such lessee in respect of such Capital Lease as of the date of
determination.

 

“Capital Lease Payments” means during any period for any Person, all
payments (other than any portion of any payment included in Interest Expense
for such period) required to be made by such Person during such period in
respect of Capital Lease Obligations.

 

“Cash Collateral Account” has the meaning assigned to it Annex B.

 

“Cash Equivalents” has the meaning assigned to it in Annex B.

 

“Cash Management Systems” has the meaning assigned to it in
Section 1.8.

 

“Certificate of Exemption” has the meaning assigned to it in
Section 1.15(c).

 

“Change of Control” any event, transaction or occurrence as a
result of which (a) prior to any initial public offering of the Stock of
H&E Holdings, BRS together with any BRS Related Party shall cease to own
and control directly or indirectly all of the voting rights associated with
ownership of at least fifty-one percent (51%) of the outstanding membership
interests (or other outstanding Stock) of H&E Holdings, (b) following
any such initial public offering of the Stock of H&E Holdings, BRS together
with any BRS Related Party together with John Engquist (and

 

A-4

 

the immediate family members, spouse and
lineal descendants of John Engquist) shall cease to  own and control directly or indirectly all of
the economic and voting rights associated with ownership of at least forty percent (40%) of the outstanding membership
interests (or other outstanding
Stock) of H&E Holdings, (c) H&E Holdings shall cease to own and
control all of the economic and
voting rights associated with ownership of at least one hundred percent (100%)
of the outstanding membership
interests (or other outstanding Stock) of H&E, (d) H&E shall cease
to own and control all of the economic and voting rights associated with
ownership of at least one hundred
percent (100%) of the outstanding capital Stock of H&E Finance and GNE
Investments, each on a fully
diluted basis, (e) GNE Investments shall cease to own and control all of
the economic and voting rights
associated with ownership of at least one hundred percent (100%) of the outstanding capital Stock of Great
Northern on a fully diluted basis, in each case except pursuant to a merger as provided in
Section 6.l(b) or (f) there shall occur any “Change of Control” as such term is defined in the
Senior Note Indenture or the Senior Subordinated Note Indenture.

 

“Charges” means all federal, state, county, city,
municipal, local, foreign or other governmental taxes (including taxes owed to
the PBGC at the time due and payable), levies, assessments, charges, liens,
claims or encumbrances upon or relating to (a) the Collateral,
(b) the Obligations, (c) the employees, payroll, income or gross
receipts of any Credit Party, (d) any Credit Party’s ownership or use of
any properties or other assets, or (e) any other aspect of any Credit
Party’s business.

 

“Chattel Paper” means any “chattel paper,” as such term is
defined in the Code, including electronic chattel paper, now owned or hereafter
acquired by any Credit Party.

 

“Closing Checklist” means the schedule, including all
appendices, exhibits or schedules thereto, listing certain documents and
information to be delivered in connection with the Agreement, the other Loan
Documents and the transactions contemplated thereunder, substantially in the
form attached hereto as Annex D.

 

“Closing Date” means June 17, 2002.

 

“Code” means the Uniform Commercial Code as the
same may, from time to time, be enacted and in effect in the State of New York;
provided, that to the extent that
the Code is used to define any term herein or in any Loan Document and such
term is defined differently in different Articles of the Code, the definition
of such term contained in Article 9 of the Code shall govern; provided, further, that in the event that,
by reason of mandatory provisions of law, any or all of the attachment,
perfection or priority of, or remedies with respect to, Agent’s or any Lender’s
Lien on any Collateral is governed by the Uniform Commercial Code as enacted
and in effect in a jurisdiction other than the State of New York, the term “Code” shall mean the Uniform Commercial Code as enacted and
in effect in such other jurisdiction solely for purposes of the provisions
thereof relating to such attachment, perfection, priority or remedies and for
purposes of definitions related to such provisions.

 

A-5

 

“Collateral” means the property covered by the Security
Agreements and the other Collateral Documents and any other property, real or
personal, tangible or intangible, now existing or hereafter acquired, that may
at any time be or become subject to a security interest or Lien in favor of
Agent, on behalf of itself and Lenders, to secure the Obligations.

 

“Collateral Agent” means the Trustee for the Senior Notes, in
its capacity as “Collateral Agent.”

 

“Collateral Documents” means the Security Agreements, the Pledge
Agreements, the Guaranties, the Patent Security Agreements, the Trademark
Security Agreements, the Copyright Security Agreements and all similar
agreements entered into guaranteeing payment of, or granting a Lien upon
property as security for payment of, the Obligations.

 

“Collateral Reports” means the reports with respect to the
Collateral referred to in Annex F.

 

“Collection Account” means that certain account of Agent, account
number 502-328-54 in the name of Agent at Bankers Trust Company in New York,
New York ABA No. 021 001 033, or such other account as may be specified in
writing by Agent as the “Collection Account”.

 

“Commitment Termination Date” means the earliest of (a) Jane 17,
2007, (b) the date of termination of Lenders’ obligations to make Advances
and to incur Letter of Credit Obligations or permit existing Loans to remain
outstanding pursuant to Section 8.2(b), and (c) the date of
indefeasible prepayment in full in cash by Borrowers of the Loans and the
cancellation and return (or stand-by guarantee) of all Letters of Credit or the
cash collateralization of all Letter of Credit Obligations pursuant to Annex B,
and the permanent reduction of all Commitments to zero dollars ($0) or the
termination of all Commitments (or the cash collateralization or backing with
standby letters of credit of all Letters of Credit in accordance with Annex B),
in accordance with the provisions of Section 1.3(a).

 

“Commitments” means (a) as to any Lender, such
Lender’s Revolving Loan Commitment (including without duplication the Swing
Line Lender’s Swing Line Commitment as a subset of its Revolving Loan Commitment)
as set forth on the signature page to the Agreement or in the most recent
Assignment Agreement executed by such Lender and (b) as to all Lenders,
the aggregate of all Lenders’ Revolving Loan Commitments (including without
duplication the Swing Line Lender’s Swing Line Commitment as a subset of its
Revolving Loan Commitment), which aggregate commitment shall be One Hundred
Fifty Million Dollars ($150,000,000) on the Closing Date, as such amount may be
reduced, amortized or adjusted from time to time in accordance with the
Agreement.

 

“Compliance Certificate” has the meaning assigned to it in Annex E.

 

“Concentration Account” has the meaning assigned to it in Annex C.

 

“Contracts” means all “contracts,” as such term is
defined in the Code, now owned or hereafter acquired by any Credit Party, in
any event, including all contracts, undertakings, or agreements (other than
rights evidenced by Chattel Paper, Documents or Instruments) in or under which
any

 

A-6

 

Credit Party may now or hereafter have any
right, title or interest, including any agreement relating to the terms of
payment or the terms of performance of any Account.

 

“Contribution Agreement and Plan
of Reorganization”
has the meaning assigned to it in the recitals to the Agreement.

 

“Control Letter” means a letter agreement between Agent and
(i) the issuer of uncertificated securities with respect to uncertificated
securities in the name of any Credit Party, (ii) a securities intermediary
with respect to securities, whether certificated or uncertificated, securities
entitlements and other financial assets held in a securities account in the
name of any Credit Party, (iii) a futures commission merchant or clearing
house, as applicable, with respect to commodity accounts and commodity
contracts held by any Credit Party, whereby, among other things, the issuer,
securities intermediary or futures commission merchant disclaims any security
interest in the applicable financial assets, acknowledges the Lien of Agent, on
behalf of itself and Lenders, on such financial assets; and agrees to follow
the instructions or entitlement orders of Agent without further consent by the
affected Credit Parry.

 

“Copyright License” means any and all rights now owned or
hereafter acquired by any Credit Party under any written agreement granting any
right to use any Copyright or Copyright registration.

 

“Copyright Security Agreements” means the Copyright Security Agreements made
in favor of Agent, on behalf of itself and Lenders, by each applicable Credit
Party.

 

“Copyrights” means all of the following now owned or
hereafter acquired by any Credit Party: (a) all copyrights and General
Intangibles of like nature (whether registered or unregistered), all
registrations and recordings thereof, and all applications in connection
therewith, including all registrations, recordings and applications in the
United States Copyright Office or in any similar office or agency of the United
States, any state or territory thereof, or any other country or any political
subdivision thereof, and (b) all reissues, extensions or renewals thereof.

 

“Credit Parties” means each Borrower and each Guarantor.

 

“Default” means any event that, with the passage of
time or notice or both, would, unless cured or waived, become an Event of
Default.

 

“Default Notice” has the meaning assigned to it in
Section 7.3.

 

“Default Rate” has the meaning assigned to it in
Section 1.5(d).

 

“Deposit Accounts” means all “deposit accounts” as such term is
defined in the Code, now or hereafter held in the name of any Credit Party.

 

“Disbursement Accounts” has the meaning assigned to it on Annex C.

 

A-7

 

“Disclosure Schedules” means the Schedules prepared by Borrowers and denominated as
Disclosure Schedules 1.4 through 6.7 in the Index to the Agreement.

 

“Documents”
means all “documents,” as such term is defined in the Code, now owned or
hereafter acquired by any Credit Party, wherever located.

 

“Dollars” or “$” means
lawful currency of the United States of America.

 

“EBlTDA”
means, with respect to any Person for any fiscal period, without duplication an
amount equal to (a) consolidated net income of such Person for such period
determined in accordance with GAAP, minus (b) the sum of (i) income tax
credits, (ii) interest income, (iii) gain from extraordinary items for such
period, and (iv) any aggregate net gain (but not any aggregate net loss) during
such period arising from the sale, exchange or other disposition of capital
assets by such Person (including any fixed assets, whether tangible or
intangible, all inventory sold in conjunction with the disposition of fixed
assets and all securities), and (v) any other non-cash gains that have been
added in determining consolidated net income, in each case to the extent
included in the calculation of consolidated net income of such Person for such
period in accordance with GAAP, but without duplication, plus (c) the
sum of (i) any provision for income taxes, (ii) Interest Expense, (iii) loss
from extraordinary items for such period, (iv) the amount of non-cash charges
(including depreciation and amortization) for such period, (v) amortized debt
discount for such period, (vi) the amount of any deduction to consolidated net
income as the result of any grant to any members of the management of such
Person of any Stock, in each case to the extent included in the calculation of
consolidated net income of such Person for such period in accordance with GAAP,
but without duplication and (vii) amounts not exceeding [$2,000,000] paid on or
about the Closing Date in respect of transaction expenses relating to the
Related Transactions. For purposes of this definition, the following items
shall be excluded in determining consolidated net income of a Person: (1) the
income (or deficit) of any other Person accrued prior to the date it became a
Subsidiary of, or was merged or consolidated into, such Person or any of such
Person’s Subsidiaries; (2) the income (or deficit) of any other Person (other
than a Subsidiary) in which such Person has an ownership interest, except to
the extent any such income has actually been received by such Person in the
form of cash dividends or distributions; (3) the undistributed earnings of any
Subsidiary of such Person to the extent that the declaration or payment of
dividends or similar distributions by such Subsidiary is not at the time
permitted by the terms of any contractual obligation or requirement of law
applicable to such Subsidiary; (4) any restoration to income of any contingency
reserve, except to the extent that provision for such reserve was made out of
income accrued during such period; (5) any write-up of any asset; (6) any net
gain from the collection of the proceeds of life insurance policies; (7) any
net gain arising from the acquisition of any securities, or the extinguishment,
under GAAP, of any Indebtedness, of such Person, (8) in the case of a successor
to such Person by consolidation or merger or as a transferee of its assets, any
earnings of such successor prior to such consolidation, merger or transfer of
assets, and (9) any deferred credit representing the excess of equity in any Subsidiary
of such Person at the date of acquisition of such Subsidiary over the cost to
such Person of the investment in such Subsidiary. For the purposes of this
definition, Interest Expense

 

A-8

 

for
the Fiscal Quarters ending on September 30, 2001, December 31, 2001, and March
31, 2002 shall be deemed to be $8,600,000 for each such Fiscal Quarter.

 

“EBlTDAR”
means, with respect to any Person for any fiscal period, EBITDA of such Person
for such Period plus Operating Lease Payments of such Person for such
Period.

 

“Eligible Accounts” has the meaning assigned to it in Section
1.6.

 

“Eligible Equipment Inventory” has the meaning assigned to it in Section 1.7A and excludes Eligible
Parts and Tools Inventory and Eligible Rolling Stock.

 

“Eligible Parts and Tools
Inventory” has the
meaning assigned to it in Section 1.7 and excludes Eligible Equipment Inventory
and Eligible Rolling Stock.

 

“Eligible Rentals” has the meaning assigned to it in Section 1.6B.

 

“Eligible Rolling Stock” has the meaning assigned to it in Section 1.6A and excludes Eligible
Parts and Tools Inventory and Eligible Equipment Inventory.

 

“Environmental Laws” means all applicable federal, state, local and foreign laws, statutes,
ordinances, codes, rules, standards and regulations, now or hereafter in
effect, and any applicable judicial or administrative interpretation thereof,
including any applicable judicial or administrative order, consent decree,
order or judgment, imposing liability or standards of conduct for or relating
to the regulation and protection of human health or safety, the environment and
natural resources (including ambient air, surface water, groundwater, wetlands,
land surface or subsurface strata, wildlife, aquatic species and vegetation).
Environmental Laws include the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980 (42 U.S.C. §§ 9601 et seq.) (“CERCLA”);
the Hazardous Materials Transportation Authorization Act of 1994 (49 U.S.C. §§
5101 et seq.); the Federal Insecticide, Fungicide, and Rodenticide Act (7
U.S.C. §§ 136 et seq.); the Solid Waste Disposal Act (42 U.S.C. §§ 6901 et
seq.); the Toxic Substance Control Act (15 U.S.C. §§ 2601 et seq.); the Clean
Air Act (42 U.S.C. §§ 7401 et seq.); the Federal Water Pollution Control Act
(33 U.S.C. §§ 1251 et seq.); the Occupational Safety and Health Act (29 U.S.C.
§§ 651 et seq.); and the Safe Drinking Water Act (42 U.S.C. §§ 300(f) et seq.),
and any and all regulations promulgated thereunder, and all analogous state,
local and foreign counterparts or equivalents and any transfer of ownership
notification or approval statutes.

 

“Environmental Liabilities” means, with respect to any Person, all liabilities, obligations,
responsibilities, response, remedial and removal costs, investigation and
feasibility study costs, capital costs, operation and maintenance costs,
losses, damages, punitive damages, property damages, natural resource damages,
consequential damages, treble damages, costs and expenses (including all
reasonable fees, disbursements and expenses of counsel, experts and
consultants), fines, penalties, sanctions and interest incurred as a result of
or related to any claim, suit, action, investigation, proceeding or demand by
any Person, whether based in contract, tort, implied or express warranty,
strict liability, criminal or civil statute or common law, including any
arising

 

A-9

 

under
or related to any Environmental Laws, Environmental Permits, or in connection
with any Release or threatened Release or presence of a Hazardous Material
whether on, at, in, under, from or about or in the vicinity of any real or
personal property.

 

“Environmental Permits” means all permits, licenses, authorizations,
certificates, approvals, registrations or other written documents required by
any Governmental Authority under any Environmental Laws.

 

“Equipment Inventory” means Inventory of any Borrower consisting of equipment held for sale
or lease to third parties and Inventory of such Borrower while on lease to third
parries.

 

“Equipment Inventory Appraisal” means each periodic appraisal of Borrowers’
Equipment Inventory and Parts and Tools Inventory conducted at the Borrowers’
cost and expense by appraisers reasonably satisfactory to Agent and using a
methodology reasonably satisfactory to Agent, provided,
that unless an Event of Default is continuing, the Borrowers’ shall
be responsible for the cost and expense of not more than four (4) such
appraisals during the first twelve months following the Closing Date and not
more than three (3) such appraisals per year thereafter, it being agreed that
so long as such limit is in effect, each item of Equipment Inventory shall be
appraised pursuant to a visit to sites of any one or more Credit Parties on one
occasion during each year and the balance of such appraisals of such item in
such year shall be done as a “desk appraisal.” An appraisal of Equipment
Inventory and of Parts and Tools Inventory shall, for the purposes of the
preceding sentence, constitute one appraisal.

 

“Equipment Inventory Rental Revenues” means, with respect to any Person for any
fiscal period, an amount equal to the gross revenues of such Person derived
from the lease of Equipment Inventory owned by such Person to third parties
(excluding revenues in respect of taxes, freight insurance and like items).

 

“Equipment Inventory Rental Expenditures” means, with respect to any Person at any
time, the aggregate acquisition cost (including all costs of initial
acquisition, improvements and additions) of all Equipment Inventory owned by
such Person at such time.

 

“ERISA” means
the Employee Retirement Income Security Act of 1974, and any regulations
promulgated thereunder.

 

“ERISA Affiliate” means, with respect to any Credit Party, any trade or business
(whether or not incorporated) that, together with such Credit Party, is treated
as a single employer within the meaning of Sections 414(b), (c), (m) or (o) of
the IRC.

 

“ERISA Event”
means, with respect to any Credit Party or any ERISA Affiliate, (a) any event
described in Section 4043(c) of ERISA with respect to a Title IV Plan (other
than an event with respect to which the reporting requirement has been waived);
(b) the withdrawal of such Credit Party or ERISA Affiliate from a Title IV Plan
subject to Section 4063 of ERISA during a plan year in which it was a
substantial employer, as defined in Section 400l(a)(2) of ERISA; (c) the
complete or partial withdrawal of such Credit Party or any ERISA Affiliate from
any

 

A-10

 

Multiemployer Plan; (d) the filing of a
notice of intent to terminate a Title IV
Plan or the treatment of a plan amendment as a termination under Section
4041 of ERISA; (e) the institution of proceedings to terminate a Title IV Plan
or Multiemployer Plan by the PBGC; (f) the failure by such Credit Party or
ERISA Affiliate to make when due required contributions to a Multiemployer Plan
or Title IV Plan unless such failure is cured within 30 days; (g) any other
event or condition that might reasonably be expected to constitute grounds
under Section 4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Title TV Plan or Multiemployer Plan or for the
imposition of liability under Section 4069 or 4212(c) of ERISA; or (h) the termination
of a Multiemployer Plan under Section 4041A of ERISA or the reorganization or
insolvency of a Multiemployer Plan under Section 4241 or 4245 of ERISA or (i)
the loss of a Qualified Plan’s qualification or tax exempt status; or (j) the
termination of a Title IV Plan described in Section 4064 of ERISA.

 

“Eurocurrency Liabilities” has the meaning
assigned to that term in Regulation D of the Board of Governors of the Federal
Reserve System, as in effect from time to time.

 

“Event of Default” has the meaning assigned
to it in Section 8.1.

 

“Fair Labor Standards Act” means the Fair Labor Standards Act, 29 U.S.C. §201 et  seq.

 

“Fair Salable Balance Sheet” means a balance sheet of Borrowers prepared
in accordance with Section 3.4(d).

 

“Federal Funds Rate” means, for any day, a floating rate equal to
the weighted average of the rates on overnight Federal funds transactions among
members of the Federal Reserve System, as determined by Agent in its sole
discretion, which determination shall be final, binding and conclusive (absent
manifest error).

 

“Federal Reserve Board” means the Board of Governors of the Federal Reserve System.

 

“Fees” means
any and all fees payable to Agent or any Lender pursuant to the Agreement or
any of the other Loan Documents.

 

“Financial Covenants” means the financial covenants set forth in Annex
G.

 

“Financial Statements” means the consolidated and consolidating
income statements, statements of cash flows and balance sheets of Borrowers
delivered in accordance with Section 3.4 and Annex E.

 

“FIRREA” means the Financial Institutions Reform, Recovery and Enforcement Act
of 1989.

 

“Fiscal Month” means
any of the monthly accounting periods of Borrowers.

 

“Fiscal Quarter” means any of the quarterly accounting periods of Borrowers, ending on
March 31, June 30, September 30, and December 31 of each year.

 

A-11

 

“Fiscal Year”
means any of the annual accounting periods of Borrowers ending on December 31
of each year.

 

“Fixtures”
means all “fixtures” as such term is defined in the Code, now owned or
hereafter acquired by any Credit Party.

 

“Floor Plan Equipment Inventory” means Eqiupment Inventory purchased by any
Credit Party for sale or lease in the ordinary course of business and subject
to a purchase money Lien in favor of the seller thereof or a third party
financing source.

 

“Foreign Lender”
has the meaning assigned to it in Section 1.15(c).

 

“Funded Debt” means, with respect to any Person, without
duplication, all Indebtedness for borrowed money evidenced by notes, bonds,
debentures, or similar evidences of Indebtedness that by its terms matures more
than one year from, or is directly or indirectly renewable or extendible at
such Person’s option under a revolving credit or similar agreement obligating
the lender or lenders to extend credit over a period of more than one year from
the date of creation thereof, and specifically including Capital Lease
Obligations, current maturities of long-term debt, revolving credit and
short-term debt extendible beyond one year at the option of the debtor, and
including without limitation, in the case of Borrowers, the Obligations
(calculated with reference to the average outstanding balance of the
Obligations during the six month period ending immediately prior to the
relevant date of determination (or such shorter period that begins on the
Closing Date and ends immediately prior to such relevant date of
determination)), the Senior Debt and the Subordinated Debt.

 

“GAAP” means
generally accepted accounting principles in the United States of America
consistently applied as such term is further defined in Annex G to the
Agreement.

 

“GE Capital”
means General Electric Capital Corporation, a Delaware corporation.

 

“GE Capital Fee Letter” has the meaning assigned to it in Section 1.9(a).

 

“General Intangibles” means all “general intangibles,” as such
term is defined in the Code, now owned or hereafter acquired by any Credit
Party, including all right, title and interest that such Credit Party may now
or hereafter have in or under any Contract, all payment intangibles, customer
lists, Licenses, Copyrights, Trademarks, Patents, and all applications therefor
and reissues, extensions or renewals thereof, rights in Intellectual Property,
interests in partnerships, joint ventures and other business associations,
licenses, permits, copyrights, trade secrets, proprietary or confidential
information, inventions (whether or not patented or patentable), technical
information, procedures, designs, knowledge, know-how, software, data bases,
data, skill, expertise, experience, processes, models, drawings, materials and
records, goodwill (including the goodwill associated with any Trademark or
Trademark License), all rights and claims in or under insurance policies
(including insurance for fire, damage, loss and casualty, whether covering
personal property, real property, tangible rights or intangible rights, all
liability, life, key man and business interruption insurance, and all unearned
premiums), uncertificated

 

A-12

 

securities,
choses in action, deposit, checking and other bank accounts, rights to receive
tax refunds and other payments, rights to receive dividends, distributions,
cash, Instruments and other property in respect of or in exchange for pledged
Stock and Investment Property, rights of indemnification, all books and
records, correspondence, credit files, invoices and other papers, including
without limitation all tapes, cards, computer runs and other papers and
documents in the possession or under the control of such Credit Party or any
computer bureau or service company from time to time acting for such Credit
Party.

 

“GNE Investments” has the meaning assigned to it in the recitals to the Agreement.

 

“GNE Investments Pledge Agreement” means the Pledge Agreement dated as of the
Closing Date executed by GNE Investments in favor of Agent, on behalf of itself
and Lenders, pledging all Stock of its Subsidiaries owned or held by GNE
Investments.

 

“Goods” means
all “goods” as defined in the Code, now owned or hereafter acquired by any
Credit Party, wherever located, including embedded software to the extent
included in “goods” as defined in the Code, manufactured homes, standing timber
that is cut and removed for
sale and unborn young of animals.

 

“Governmental Authority” means any nation or government, any state or other political
subdivision thereof, and any agency, department or other entity exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government.

 

“Great Northern”
has the meaning assigned to it in the recitals to the Agreement.

 

“Great Northern Advance” shall mean an advance by H&E to Great Northern of the proceeds of
an H&E/Great Northern Advance.

 

“Great Northern Borrowing Base” means, as of any date of determination by
Agent, from time to time, an amount equal to the sum at such time of:

 

(a)           up to eighty-five percent (85%) of Great
Northern’s Eligible Accounts plus up to eighty five percent (85%) of Great
Northern’s Eligible Rentals, less any Reserves (without duplication)
established by Agent in good faith using reasonable credit judgment as of such
time; plus

 

(b)           up to fifty percent (50%) of the Net Book
Value of Great Northern’s Eligible Parts and Tools Inventory, less any Reserves
(without duplication) established by Agent in good faith using reasonable
credit judgment as of such time; plus

 

(c)           up to one hundred percent (100%) of the Net
Book Value of Great Northern’s new Eligible Equipment Inventory held for sale,
less any Reserves (without duplication) established by Agent in good faith
using reasonable credit judgment as of such time; plus

 

A-13

 

(d)           up to fifty percent (50%) of the Net Book
Value of Great Northern’s used Eligible Equipment Inventory held for sale, less
any Reserves (without duplication) established by Agent in good faith using
reasonable credit judgment as of such time; plus

 

(e)           the lesser of (i) one hundred percent (100%)
of the Net Book Value of Great Northern’s Eligible Equipment Inventory held for
lease to third parties or being leased to third parties and (ii) up to eighty
percent (80%) of the Orderly Liquidation Value of Great Northern’s Eligible
Equipment Inventory held for lease or being leased to third parties, in each
case, less any Reserves (without duplication) established by Agent in good
faith using reasonable credit judgment as of such time; plus

 

(f)            up to fifty percent
(50%) of the Orderly Liquidation Value of Great Northern’s Eligible Rolling Stock, less any Reserves (without
duplication) established by Agent in good faith using reasonable credit
judgment as of such time.

 

“Guaranteed Indebtedness” means, as to any Person, any obligation of such Person guaranteeing,
providing comfort or otherwise supporting any Indebtedness, lease, dividend, or
other obligation (“primary obligations”)
of any other Person (the “primary obligor”)
in any manner, including any obligation or arrangement of such Person to (a)
purchase or repurchase any such primary obligation, (b) advance or supply funds
(i) for the purchase or payment of any such primary obligation or (ii) to
maintain working capital or equity capital of the primary obligor or otherwise
to maintain the net worth or solvency or any balance sheet condition of the
primary obligor, (c) purchase property, securities or services primarily for
the purpose of assuring the owner of any such primary obligation of the ability
of the primary obligor to make payment of such primary obligation, (d) protect
the beneficiary of such arrangement from loss (other than product warranties
given in the ordinary course of business) or (e) indemnify the owner of such
primary obligation against loss in respect thereof. The amount of any
Guaranteed Indebtedness at any time shall be deemed to be an amount equal to
the lesser at such time of (x) the stated or determinable amount of the primary
obligation in respect of which such Guaranteed Indebtedness is incurred and (y)
the maximum amount for which such Person may be liable pursuant to the terms of
the instrument embodying such Guaranteed Indebtedness, or, if not stated or
determinable, the maximum reasonably anticipated liability (assuming full
performance) in respect thereof.

 

“Guaranties”
means, collectively, the H&E Holdings Guaranty, each Subsidiary Guaranty
and any other guaranty executed by any Guarantor in favor of Agent and Lenders
in respect of the Obligations.

 

“Guarantors”
means H&E Holdings, Great Northern, each Subsidiary of each Borrower (other
than each such Subsidiary that is a Borrower) and each other Person, if any,
that executes a guaranty or other similar agreement in favor of Agent, for
itself and the ratable benefit of Lenders, in connection with the transactions
contemplated by the Agreement and the other Loan Documents.

 

A-14

 

“Gulf Wide” has the meaning assigned to it in the recitals to the Agreement.

 

“H&E” has the meaning assigned to it in the recitals to the Agreement.

 

“H&E Borrowing Base” means, as of any date of determination by
Agent, from time to time, an amount equal to the sum at such time of:

 

(a)           up to eighty-five percent (85%) of H&E’s Eligible Accounts plus up
to eighty five percent of H&E’s Eligible Rentals, less any Reserves
(without duplication) established by Agent in good faith using reasonable
credit judgment as of such time; plus

 

(b)           up to fifty percent (50%) of the Net Book
Value of H&E’s Eligible Parts and Tools Inventory, less any Reserves
(without duplication) established by Agent in good faith using reasonable
credit judgment as of such time; plus

 

(c)           up to one hundred percent (100%) of the Net
Book Value of H&E’s new Eligible Equipment Inventory held for sale, less
any Reserves (without duplication) established by Agent in good faith using
reasonable credit judgment as of such time; plus

 

(d)           up to fifty percent (50%) of the Net Book
Value of H&E’s used Eligible Equipment Inventory held for sale, less any
Reserves (without duplication) established by Agent in good faith using reasonable
credit judgment as of such time; plus

 

(e)           the lesser of (i) one hundred percent (100%)
of the Net Book Value of H&E’s Eligible Equipment Inventory held for lease
to third parties or being leased to third parties, and (ii) up to eighty
percent (80%) of the Orderly Liquidation Value of H&E’s Eligible Equipment
Inventory held for lease to third parties or being leased to third parties, in
each case, less any Reserves (without duplication) established by Agent in good
faith using reasonable credit judgment as of such time; plus

 

(f)            up to fifty percent (50%) of the Orderly
Liquidation Value of H&E’s Eligible Rolling Stock, less any Reserves
(without duplication) established by Agent in good faith using reasonable
credit judgment as of such time.

 

“H&E Contribution” has
the meaning assigned to it in the recitals to the Agreement. 

 

“H&E Finance” has the meaning assigned to it in the recitals to the Agreement.

 

“H&E/Great Northern Advance” shall mean a Revolving Advance or Swing Line
Advance made to H&E and identified as an “H&E/Great Northern Advance”
on the applicable notice of Revolving Credit Advance, the proceeds of which are
to be advanced by H&E to Great Northern as a Great Northern Advance.
Payments in respect of the Obligations shall be applied between H&E/Great
Northern Advances and Advances other than H&E/Great Northern Advances as
determined by Agent.

 

“H&E Holdings” has the meaning assigned to it in the recitals to the Agreement.

 

A-15

 

“H&E Holdings Guaranty” means the guaranty dated as of the Closing
Date executed by H&E Holdings in favor of Agent, on behalf of itself and
Lenders, in respect of the Obligations.

 

“H&E Holdings Pledge Agreement” means the Pledge Agreement dated as of the
Closing Date executed by H&E Holdings in favor of Agent, on behalf of
itself and Lenders, pledging all stock of its Subsidiaries owned or held by
H&E Holdings and all Intercompany Notes owing to or held by it.

 

“Hazardous Material” means any substance, material or waste that
is regulated by or forms the basis of liability now or hereafter under, any
Environmental Laws, including any material or substance that is (a) defined as
a “solid waste,” “hazardous waste,” “hazardous material,” “hazardous
substance,” “extremely hazardous waste,” “restricted hazardous waste,”
“pollutant,” “contaminant,” “hazardous constituent,” “special waste,” “toxic
substance” or other similar term or phrase under any Environmental Laws, (b)
petroleum or any fraction or by-product thereof, asbestos, polychlorinated
biphenyls (PCB’s), or any radioactive substance.

 

“Hedging Agreement” means any interest rate protection agreement, foreign currency
exchange agreement, commodity price protection agreement, treasury management
products or other interest or currency exchange rate or commodity price hedging
arrangement to which a Lender and one or more Credit Parties are parties.

 

“Indebtedness”
of any Person means, without duplication, (a) all indebtedness of such Person
for borrowed money or for the deferred purchase price of property payment for
which is deferred six (6) months or more, but excluding obligations to trade
creditors incurred in the ordinary course of business that are unsecured and
not overdue by more than six (6) months
unless being contested in good faith, (b) all reimbursement and other
obligations with respect to letters of credit, bankers’ acceptances and surety
bonds, whether or not matured, (c) all obligations evidenced by notes, bonds,
debentures or similar instruments, (d) all indebtedness created or arising
under any conditional sale or other title retention agreement with respect to
property acquired by such Person (even though the rights and remedies of the
seller or lender under such agreement in the event of default are limited to
repossession or sale of such property), (e) all Capital Lease Obligations and
the present value (discounted at the Index Rate as in effect on the Closing
Date) of future rental payments under all synthetic leases, (f) all obligations
of such Person under commodity purchase or option agreements or other commodity
price hedging arrangements, in each case whether contingent or matured, (g) all
obligations of such Person under any foreign exchange contract, currency swap
agreement, interest rate swap, cap or collar agreement or other similar
agreement or arrangement designed to alter the risks of that Person arising
from fluctuations in currency values or interest rates, in each case whether
contingent or matured, (h) all Indebtedness referred to above secured by (or
for which the holder of such Indebtedness has an existing right, contingent or
otherwise, to be secured by) any Lien upon or in property or other assets
(including accounts and contract rights) owned by such Person, even though such
Person has not assumed or become liable for the payment of such Indebtedness,
and (i) the Obligations.

 

A-16

 

“Indemnified Liabilities” has the meaning assigned to it in Section 1.13.

 

“Indemnified Person” has the meaning assigned to it in Section 1.13.

 

“Index Rate”
means, for any day, a floating rate equal to the higher of (i) the rate
publicly quoted from time to time by The
Wall Street Journal as the “base rate on corporate loans posted by
at least 75% of the nation’s 30 largest banks” (or, if The Wall Street Journal ceases quoting a
base rate of the type described, the highest per annum rate of interest
published by the Federal Reserve Board in Federal Reserve statistical release
H.15 (519) entitled “Selected Interest Rates” as the Bank prime loan rate or
its equivalent), and (ii) the Federal Funds Rate plus fifty (50) basis
points per annum. Each change in any interest rate provided for in the
Agreement based upon the Index Rate shall take effect at the time of such change
in the Index Rate.

 

“Index Rate Loan” means a Loan or portion thereof bearing interest by reference to the
Index Rate.

 

“Inspection” has the meaning assigned to it in Section 1.14.

 

“Instruments” means any “instrument,” as such term is defined in the Code, now owned
or hereafter acquired by any Credit Party, wherever located, and, in any event,
including all certificated securities, all certificates of deposit, and all
promissory notes and other evidences of indebtedness, other than instruments that
constitute, or are a part of a group of writings that constitute, Chattel
Paper.

 

“Intellectual Property” means any and all Licenses, Patents,
Copyrights, Trademarks, and the goodwill associated with such Trademarks.

 

“Intercompany Notes” has the meaning assigned to it in Section 6.3.

 

“Inter-Creditor Agreement” means, the intercreditor agreement of even
date herewith entered into by and among Bank of New York as Collateral Agent,
Agent, H&E Finance and H&E.

 

“Interest Expense” means, with respect to any Person for any fiscal period, interest
expense paid in cash of such Person determined in accordance with GAAP for the
relevant period ended on such date, including expense with respect to any
Funded Debt of such Person and interest expense for the relevant period that
has been capitalized on the balance sheet of such Person.

 

“Interest Payment Date” means (a) as to any Index Rate Loan, the first Business Day of each
month to occur while such Loan is outstanding and (b) as to any LIBOR Loan, the
last day of the applicable LIBOR Period; provided,
that in the case of any LIBOR Period greater than three months in
duration, interest shall be payable at three month intervals and on the last
day of such LIBOR Period; and provided, further, that, in
addition to the foregoing, each of (x) the date upon which all of the
Commitments have been terminated and the Loans have been paid in full and (y)
the Commitment Termination Date shall be deemed to be an “Interest Payment
Date” with respect to any interest that has then accrued under the Agreement.

 

A-17

 

“Inventory” means all “inventory,” as such term is defined in the Code, now owned
or hereafter acquired by any Credit Party, wherever located, and in any event
including inventory, merchandise, goods and other personal property that are
held by or on behalf of any Credit Party for sale or lease or are furnished or
are to be furnished under a contract of service, or that constitute raw
materials, work in process, finished goods, returned goods, or materials or
supplies of any kind, nature or description used or consumed or to be used or
consumed in such Credit Party’s business or in the processing, production,
packaging, promotion, delivery or shipping of the same, including all supplies
and embedded software.

 

“Investment Property” means all “investment property” as such term is defined in the Code
now owned or hereafter acquired by any Credit Party, wherever located,
including (i) all securities, whether certificated or uncertificated, including
stocks, bonds, interests in limited liability companies, partnership interests,
treasuries, certificates of deposit, and mutual fund shares; (ii) all
securities entitlements of any Credit Party, including the rights of any Credit
Party to any securities account and the financial assets held by a securities
intermediary in such securities account and any free credit balance or other
money owing by any securities intermediary with respect to that account; (iii)
all securities accounts of any Credit Party; (iv) all commodity contracts of
any Credit Party; and (v) all commodity accounts of any Credit Party.

 

“IRC” means
the Internal Revenue Code of 1986 and all regulations promulgated thereunder.
“IRS” means the Internal Revenue Service.

 

“L/C Issuer” means (a) any Lender, any Affiliate of any Lender and, with respect to
any Lender that is an investment fund that invests in commercial loans, any
other investment fund that invests in commercial loans and that is managed or
advised by the same investment advisor as such Lender or by an Affiliate of
such investment advisor, and (b) any commercial bank, savings and loan
association or savings bank or any other entity which is an “accredited
investor” (as defined in Regulation D under the Securities Act of 1933) which
extends credit, buys loans or provides letters of credit as one of its
businesses, including insurance companies, mutual funds, lease financing
companies and commercial finance companies, in each case, which has a rating of
BBB or higher from S&P and a rating of Baa2 or higher from Moody’s at the
date that it becomes an L/C Issuer; provided,
that no Person or Affiliate of such Person (other than a Person that
is already a Lender) holding Subordinated Debt or Stock issued by any Credit
Party shall be an L/C Issuer.

 

“L/C Sublimit” has the meaning assigned to such term in Annex B.

 

“Lenders”
means GE Capital, the other initial Lenders named on the signature pages of the
Agreement, and, if any such Lender shall decide to assign all or any portion of
the Obligations, such term shall include any registered assignee of such Lender.

 

“Letter of Credit Fee” has the meaning assigned to it in Annex B.

 

A-18

 

“Letter of Credit Obligations” means all outstanding obligations incurred by
Agent and Lenders at the request of any Borrower, whether direct or indirect,
contingent or otherwise, due or not due, in connection with the issuance of
Letters of Credit by Agent or any other L/C Issuer or the purchase of a participation
as set forth in Annex B with respect to any Letter of Credit, The amount of
such Letter of Credit Obligations shall equal the maximum amount that may be
payable at such time or at any time thereafter by Agent or Lenders thereupon or
pursuant thereto.

 

“Letters of Credit” means documentary or standby letters of credit issued for the account
of any Borrower by any L/C Issuer, and bankers’ acceptances issued by any
Borrower, for which Agent and Lenders have incurred Letter of Credit
Obligations.

 

“Letter of Credit Rights” means “letter of credit rights” as such term
is defined in the Code, now owned or hereafter acquired by any Credit Party,
including rights to payment or performance under a letter of credit, whether or
not such Credit Party, as beneficiary, has demanded or is entitled to demand
payment or performance.

 

Leverage Ratio” means, with respect to H&E Holdings and its Subsidiaries, on a
consolidated basis, the ratio of (i) Funded Debt of H&E Holdings and its
Subsidiaries as of any date of determination, to (ii) EBITDA of H&E
Holdings and its Subsidiaries for the twelve-month period ending on that date
of determination.

 

“LIBOR Business Day” means a Business Day on which banks in the
City of London are generally open for interbank or foreign exchange
transactions.

 

“LIBOR Loan” means a Loan or any portion thereof bearing interest by reference to
the LIBOR Rate.

 

“LIBOR Period” means, with respect to any LIBOR Loan, each period commencing on a
LIBOR Business Day selected by Borrower Representative pursuant to the
Agreement and ending one, two, three or six months thereafter, as selected by
Borrower Representative’s irrevocable notice to Agent as set forth in Section
1.5(e); provided, that
the foregoing provision relating to LIBOR Periods is subject to the following:

 

(a)           if any LIBOR Period would otherwise end on a
day that is not a LIBOR Business Day, such LIBOR Period shall be extended to
the next succeeding LIBOR Business Day unless the result of such extension
would be to carry such LIBOR Period into another calendar month in which event
such LIBOR Period shall end on the immediately preceding LIBOR Business Day;

 

(b)           any LIBOR Period that would otherwise extend
beyond the Commitment Termination Date shall end 1 LIBOR Business Days prior to
such date;

 

(c)           any LIBOR Period that begins on the last
LIBOR Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the calendar month at the 

 

A-19

 

end of such LIBOR Period) shall end on the
last LIBOR Business Day of a calendar month;

 

(d)           Borrower Representative shall select LIBOR
Periods so as not to require a payment or prepayment of any LIBOR Loan during a
LIBOR Period for such Loan; and

 

(e)           Borrower Representative shall select LIBOR
Periods so that there shall be no more than ten (10) separate LIBOR Loans in
existence at any one time.

 

“LIBOR Rate” means for each LIBOR Period, (a) a rate of interest determined by Agent
equal to the offered rate for deposits in United States Dollars for the
applicable LIBOR Period that appears on Telerate Page 3750 as of 11:00 a.m.,
London time, on the second full LIBOR Business Day next preceding the first day
of such LIBOR Period (unless such date is not a Business Day, in which event
the next succeeding Business Day will be used); divided by (b) a number
equal to 4.0 minus the aggregate (but without duplication) of the rates
(expressed as a decimal fraction) of reserve requirements in effect on the day
that is 2 LIBOR Business Days prior to the beginning of such LIBOR Period
(including basic, supplemental, marginal and emergency reserves under any
regulations of the Federal Reserve Board or other Governmental Authority having
jurisdiction with respect thereto, as now and from time to time in effect) for
Eurocurrency funding (currently referred to as “Eurocurrency Liabilities” in
Regulation D of the Federal Reserve Board that are required to be maintained by
a member bank of the Federal Reserve System. If such interest rate shall cease
to be available from Telerate News Service, the LIBOR Rate shall be determined
from such financial reporting service or other information as shall be mutually
acceptable to Agent and Borrower Representative.

 

“License” means any Copyright License, Patent License, Trademark License or
other license of rights or interests now held or hereafter acquired by any
Credit Party.

 

“Lien” means
any mortgage or deed of trust, pledge, hypothecation, assignment, deposit
arrangement, lien, charge, claim, security interest, easement or encumbrance,
or preference, priority or other security agreement or preferential arrangement
of any kind or nature whatsoever (including any lease or title retention
agreement, any financing lease having substantially the same economic effect as
any of the foregoing, and the filing of, or agreement to give, any financing
statement perfecting a security interest under the Code or comparable law of
any jurisdiction).

 

“Litigation” has the meaning assigned to it in Section 3.13.

 

“Loan Account” has the meaning assigned to it in Section 1.12.

 

“Loan Documents” means the Agreement, the Notes, the GE Capital Fee Letter, the
Syndication Letter and the Collateral Documents and all other agreements,
instruments, documents and certificates identified in the Closing Checklist
executed and delivered to, or in favor of, Agent or any Lenders and including
all other pledges, powers of attorney, consents, assignments, contracts,
notices, and all other written matter whether heretofore, now or hereafter
executed by or on

 

A-20

 

behalf
of any Credit Party, and delivered to Agent or any Lender in connection with
the Agreement or the transactions contemplated thereby. Any reference in the
Agreement, any other Loan Document or the Syndication Letter to a Loan Document
shall include all appendices, exhibits or schedules thereto, and all
amendments, restatements, supplements or other modifications thereto, and shall
refer to the Agreement or such Loan Document as the same may be in effect at
any and all times such reference becomes operative.

 

“Loans” means the Revolving Loan and the Swing Line Loan. 

 

“Lock Boxes” has the meaning assigned to it in Annex C.

 

“Majority
Revolving Lenders”
means (a) Lenders having more than 50% of the Commitments of all Lenders, or
(b) if the Commitments have been terminated, more than 50% of the aggregate
outstanding amount of the Loans (without giving effect to the Swing Line Loan)
and Letter of Credit Obligations.

 

“Margin Stock” has the meaning assigned to in Section 3.10.

 

“Material Adverse Effect” means a material adverse effect on (a) the
business, assets, operations, prospects or financial or other condition of
Credit Parties considered as a whole, (b) Borrowers’ ability to pay any of the
Loans or any of the other Obligations in accordance with the terms of the
Agreement, (c) the Collateral or Agent’s Liens, on behalf of itself and
Lenders, on the Collateral or the priority of such Liens, or (d) Agent’s or any
Lender’s rights and remedies under the Agreement and the other Loan Documents.

 

“Maximum Amount” means, as of any date of determination, an amount equal to the
Revolving Loan Commitment of all Lenders as of that date.

 

“Mergers” has the meaning assigned to it in the recitals to the Agreement.

 

“Multiemployer Plan” means a “multiemployer plan” as defined in Section 4001 (a)(3) of
ERISA, and to which any Credit Party or an ERISA Affiliate is making or is
obligated to make, contributions on behalf of participants who are or were
employed by any of them.

 

“Net Book Value” means book value as determined in accordance with GAAP, lower of cost
and market, and after taking into account depreciation and excluding all
“freight-in” costs and preparatory costs.

 

“Non-Funding Lender” has the meaning assigned to it in Section 9.9(d).

 

“Notes” means, collectively, the Revolving Notes and the Swing Line Notes.

 

“Notice of Conversion/Continuation” has the meaning assigned to it in Section
1.5(e).

 

“Notice of Revolving Credit Advance” has the meaning assigned to it in Section l.1(a).

 

A-21

 

“Obligations” means (a) all loans, advances, debts, liabilities and obligations for
the performance of covenants, tasks or duties or for payment of monetary
amounts (whether or not such performance is then required or contingent, or
such amounts are liquidated or determinable) owing by any Credit Party to Agent
or any Lender, and all covenants and duties regarding such amounts, of any kind
or nature, present or future, whether or not evidenced by any note, agreement
or other instrument, arising under the Agreement or any of the other Loan
Documents and (b) for the purposes of the application of payments under Section
1.11(a) and the Collateral Documents, all liabilities, indebtedness and
obligations of any Borrower arising under any Hedging Agreement. This term
includes all principal, interest (including all interest that accrues after the
commencement of any case or proceeding by or against any Credit Party in
bankruptcy, whether or not allowed in such case or proceeding), Fees, Charges,
expenses, attorneys’ fees and any other sum chargeable to any Credit Party
under the Agreement or any of the other Loan Documents or any Hedging
Agreement.

 

“Off Balance Sheet Equipment Inventory” means Equipment Inventory that has been
leased by any Credit Party as lessee under an operating lease, and held for
sublease by such Credit Party to third parties in the ordinary course of
business.

 

“Operating Lease Payments” means, for any Person during any period, all payments required to be
made by such Person during such Period in respect of leases by such Person as
lessee of Equipment Inventory, excluding any payment under any Capital Lease
Obligation as lessee of such Equipment Inventory.

 

“Operating Lease Payoff Value” means, with respect to any operating lease
of Equipment Inventory to which any Borrower or Guarantor is a lessee, at any
time, the sum of the then remaining lease payments under such operating lease,
discounted to present value at the notional interest rate for such operating
lease.

 

“Orderly Liquidation Value” shall mean (i) with respect to Eligible
Equipment Inventory, the orderly liquidation value thereof as determined by the
most recent Equipment Inventory Appraisal and (ii) with respect to Eligible
Rolling Stock, the orderly liquidation value thereof as determined by the most
recent P&E Appraisal.

 

“Original Advance Rate” means, with respect to any percentage
advance rate contained in the Great Northern Borrowing Base or the H&E
Borrowing Base, such advance rate as in effect on the Closing Date.

 

“P&E” means all “equipment,” as such term is defined in the Code, now owned
or hereafter acquired by any Credit Party, wherever located and, in any event,
including all such Credit Party’s machinery and equipment, including processing
equipment, conveyors, machine tools, data processing and computer equipment,
including embedded software and peripheral equipment and all engineering,
processing and manufacturing equipment, office machinery, furniture, materials
handling equipment, tools, attachments, accessories, automotive equipment,
trailers, trucks, forklifts, molds, dies, stamps, motor vehicles, rolling stock
and other equipment of every kind and

 

A-22

 

nature,
trade fixtures and fixtures not forming a part of real property, together with
all additions and accessions thereto, replacements therefor, all parts
therefor, all substitutes for any of the foregoing, fuel therefor, and all
manuals, drawings, instructions, warranties and rights with respect thereto and
all products and proceeds thereof and condemnation awards and insurance
proceeds with respect thereto. P&E excludes Equipment Inventory and
Fixtures.

 

“P&E Appraisal” means each periodic appraisal of Borrowers’ P&E conducted at the
Borrowers’ cost and expense by appraisers reasonably satisfactory to Agent and
using a methodology reasonably satisfactory to Agent, provided, that unless an Event of Default
has occurred and is continuing, the Borrowers shall be responsible for the cost
and expense of not more than four (4) such appraisals during the first twelve
months following the Closing Date and not more than three (3) such appraisals
per year thereafter, it being agreed that so long as such limit is in effect,
each item of Equipment Inventory shall be appraised pursuant to a visit to
sites of any one or more Credit Parries on one occasion during each year and
the balance of such appraisals of such item in such year shall be done as a
“desk appraisal.”

 

“P&E Capital Expenditures” means, with respect to any Person, all
expenditures (by the expenditure of cash or the incurrence of Indebtedness) by
such Person during any measuring period for any P&E or improvements or for
replacements, substitutions or additions thereto, that have a useful life of
more than one year and that are required to be capitalized under GAAP
(excluding any such expenditures related to Permitted Acquisitions).

 

“Parts and Took Inventory” means Inventory of any Borrower consisting of
parts, tools and supplies.

 

“Patent License”
means rights under any written agreement now owned or hereafter acquired by any
Credit Party granting any right with respect to any invention on which a Patent
is in existence.

 

“Patent Security Agreements” means the Patent Security Agreements made in
favor of Agent, on behalf of itself and Lenders, by each applicable Credit
Party.

 

“Patents”
means all of the following in which any Credit Party now holds or hereafter
acquires any interest: (a) all letters patent of the United States or of any
other country, all registrations and recordings thereof, and all applications
for letters patent of the United States or of any other country, including
registrations, recordings and applications in the United States Patent and
Trademark Office or in any similar office or agency of the United States, any
State or any other country, and (b) all reissues, continuations,
continuations-in-part or extensions thereof.

 

“PBGC”
means the Pension Benefit Guaranty Corporation. 

 

“Pension Plan” means a Plan described in Section 3(2) of ERISA.

 

“Permitted Acquisition” has the meaning assigned to it in Section
6.1.

 

A-23

 

“Permitted Encumbrances” means
the following encumbrances: (a) Liens for taxes or assessments or other
governmental Charges not yet due and payable, or which are being contested in
accordance with Section 5.2(b); (b) pledges or deposits of money securing
statutory obligations under workmen’s compensation, unemployment insurance,
social security or public liability laws or similar legislation (excluding
Liens under ERISA); (c) pledges or deposits of money securing bids, tenders,
contracts (other than contracts for the payment of money) or teases to which
any Borrower is a party as lessee in the ordinary course of business; (d)
deposits of money securing statutory obligations of any Borrower; (e) inchoate
and unperfected workers’, mechanics’ or similar liens arising in the ordinary
course of business, so long as such Liens attach only to P&E, Fixtures and/or Real Estate;
(f) carriers’, warehousemen’s, suppliers’ or other similar possessory liens
arising in the ordinary course of business and securing liabilities, so long as
such Liens attach only to Equipment Inventory; (g) deposits securing, or in
lieu of, surety, appeal or customs bonds in proceedings to which any Borrower
is a party; (h) any attachment or judgment lien not constituting an Event of
Default under Section 8.l(j); (i) zoning restrictions, easements, licenses, or
other restrictions on the use of any Real Estate or other minor irregularities
in title (including leasehold title) thereto, so long as the same do not
materially impair the use, value, or marketability of such Real Estate; (j) presently
existing or hereafter created Liens in favor of Agent, on behalf of Lenders,
and to the extent subject to the Inter-Creditor Agreement, in favor of
Collateral Agent, on behalf of the holders of Senior Notes; and (k) Liens of
landlords or mortgages arising by operation of law or pursuant to the terms of
real property leases, provided, that
the mortgage or rental payments secured thereby are not yet overdue, and the
applicable mortgage or lease is not otherwise in default in a manner which
could permit the applicable mortgagee or lessee to take enforcement action with
respect to such Liens.

 

“Person”
means any individual, sole proprietorship, partnership, joint venture, trust,
unincorporated organization, association, corporation, limited liability company,
institution, public benefit corporation, other entity or government (whether
federal, state, county, city, municipal, local, foreign, or otherwise,
including any instrumentality, division, agency, body or department thereof).

 

“Plan” means,
at any time, an “employee benefit plan”, as defined in Section 3(3) of ERISA,
that any Credit Party maintains, contributes to or has an obligation to
contribute to or has any liability under.

 

“Pledge Agreements” means the H&E Holdings Pledge Agreement, the H&E Pledge
Agreement, the GNE Investments Pledge Agreement and any other pledge agreement
entered into after the Closing Date in connection herewith (as required by the
Agreement or any other Loan Document).

 

“Prior Lenders”
means the holders of the Prior Obligations.

 

“Prior Obligations” means collectively, the indebtedness under or pursuant to, as
applicable, (i) the Credit Agreement dated as of February 4, 1998, as amended
and restated as of July 31, 1998, among ICM, Great Northern Equipment, Inc.,
Williams Bros. Construction, Inc., the Prior

 

A-24

 

Lenders,
Bankers Trust Company as Syndication Agent and Co-Agent, GE Capital as
Documentation Agent and Co-Agent and The CIT Group/Equipment Financing, Inc. as
Agent, as subsequently amended; (ii) the Loan Agreement dated August 10, 1998
between The CIT Group/Equipment Financing, Inc. and H&E, as subsequently
amended; and (iii) the 10% Senior Subordinated Promissory Note dated February
20, 2002 issued by ICM to John Engquist.

 

“Proceeds”
means “proceeds.” as such term is defined in the Code, including (a) any and
all proceeds of any insurance, indemnity, warranty or guaranty payable to any
Credit Party from time to time with respect to any of the Collateral, (b) any
and all payments (in any form whatsoever) made or due and payable to any Credit
Party from time to time in connection with any requisition, confiscation,
condemnation, seizure or forfeiture of all or any part of the Collateral by any
Governmental Authority (or any Person acting under color of governmental
authority), (c) any claim of any Credit Party against third parties (i) for
past, present or future infringement of any Patent or Patent License, or (ii)
for past, present or future infringement or dilution of any Copyright,
Copyright License, Trademark or Trademark License, or for injury to the
goodwill associated with any Trademark or Trademark License, (d) any recoveries
by any Credit Party against third parties with respect to any litigation or
dispute concerning any of me Collateral, including claims arising out of the
loss or nonconformity of, interference with the use of, defects in, or
infringement of rights in, or damage to, Collateral, (e) all amounts collected
on, or distributed on account of, other Collateral, including dividends,
interest, distributions and Instruments with respect to Investment Property and
pledged Stock, and (i) any and all other amounts, rights to payment or other
property acquired upon the sale, lease, license, exchange or other disposition
of Collateral and all rights arising out of Collateral.

 

“Pro Forma”
means the unaudited consolidated and consolidating balance sheet of Borrowers
and their Subsidiaries as of March 31, 2002 after giving pro forma effect to the Related Transactions.

 

“Prohibited Swing Line Advance” means a Swing Line Advance (i) that was made
without satisfaction of the condition contained in Section 2.2(e) by virtue of
such Swing Line Advance exceeding Swing Line Availability due to the limitation
imposed by Section l.1(b)(i)(A) or l.1(b)(i)(B)(x) (but not l.1(b)(i)(B)(y)),
or (ii) (x) that was made without satisfaction of the condition contained in
Section 2.2(e) by virtue of such Swing Line Advance exceeding Swing Line
Availability due to the limitation imposed by Section l.1(b)(i)(B)(y) based on
the Aggregate Borrowing Base as reflected in the most recent Borrowing Base
Certificate delivered to the Agent prior to the making of such Swing Line
Advance and (y) that (A) exceeds $4,000,000, or (B) when added to any Swing
Line Advances (described in clause (ii)(x) of this definition) made (1) during
the period of 10 Business Days ending on (and including) the date of making of
such Swing Line Advance, exceeds $4,000,000 or (2) during the period from and
after the Closing Date, exceeds $10,000,000.

 

“Projections”
means Borrowers’ forecasted consolidated and consolidating (a) balance sheets;
(b) profit and loss statements; (c) cash flow statements; and (d)
capitalization statements, all prepared on a Subsidiary by Subsidiary or
division-by-division basis, if applicable, and otherwise

 

A-25

 

consistent
with the historical Financial Statements of Borrowers, together with
appropriate supporting details and a statement of underlying assumptions.

 

“Properly Elects” has the meaning assigned to it in Section 7.3.

 

“Pro Rata Share”
means with respect to all matters relating to any Lender and with respect to
the Revolving Loan, the percentage obtained by dividing (i) the Revolving Loan
Commitment of that Lender by (ii) the aggregate Revolving Loan Commitments of
all Lenders.

 

“Qualified Assignee” means (a) any Lender, any Affiliate of any Lender and, with respect to
any Lender that is an investment fund that invests in commercial loans, any
other investment fund that invests in commercial loans and that is managed or
advised by the same investment advisor as such Lender or by an Affiliate of
such investment’ advisor, and (b) any commercial bank, savings and loan
association or savings bank or any other entity which is an “accredited
investor” (as defined in Regulation D under the Securities Act of 1933) which
extends credit or buys loans as one of its businesses, including insurance
companies, mutual funds, lease financing companies and commercial finance
companies, in each case, which has a rating of BBB or higher from S&P and a
rating of Baa2 or higher from Moody’s at the date that it becomes a Lender and
which, through its applicable lending office, is capable of lending to Borrowers
without the imposition of any withholding or similar taxes; provided, that no Person determined by
Agent to be acting in the capacity of a vulture fund or distressed debt
purchaser shall be a Qualified Assignee, and no Person or Affiliate of such
Person (other than a Person that is already a Lender) holding Subordinated Debt
or Stock issued by any Credit Party shall be a Qualified Assignee.

 

“Qualified Plan”
means a Pension Plan that is intended to be tax-qualified under Section 401(a)
of the IRC.

 

“Real Estate”
has the meaning assigned to it in Section 3.6.

 

“Refinancing”
means the repayment in full by Borrowers of the Prior Obligations on the
Closing Date.

 

“Refunded Swing Line Loan” has the meaning assigned to it in Section 1.1(b)(iii).

 

“Related Transactions Documents” means the initial borrowing under the
Commitments on the Closing Date, the Mergers, contributions and other
transactions to occur under the Contribution Agreement and Plan of
Reorganization, the Refinancing, the issuance of the Senior Notes, the issuance
of the Senior Subordinated Notes and the related preferred and common units,
the payment of all fees, costs and expenses associated with all of the
foregoing and the execution and delivery of all of the Related Transactions.

 

“Related Transactions Documents” means the Loan Documents, the Contribution
Agreement and Plan of Reorganization, the Senior Note Indenture, the Senior
Subordinated Note Indenture and all other agreements and instruments executed
and delivered in connection with the Related Transactions.

 

A-26

 

“Release”
means any release, threatened release, spill, emission, leaking, pumping,
pouring, emitting, emptying, escape, injection, deposit, disposal, discharge,
dispersal, dumping, leaching or migration of Hazardous Material in the indoor
or outdoor environment, including the movement of Hazardous Material through or
in the air, soil, surface water, ground water or property.

 

“Rentals” means rental payments due to any Borrower
from the rental of (i) Equipment Inventory owned by such Borrower or (ii)
inventory leased by such Borrower.

 

“Requisite Lenders” means (a) Lenders having at least 66 2/3% of the Commitments of all
Lenders, or (b) if the Commitments have been terminated, at least 66 2/3% of
the aggregate outstanding amount of the Loans (without giving effect to the
Swing Line Loan) and Letter of Credit Obligations.

 

“Reserves” means,
with respect to the Borrowing Base of any Borrower (a) reserves established by
Agent from time to time against Eligible Parts and Tools Inventory or Eligible
Equipment Inventory pursuant to Section 5.9, (b) reserves established pursuant
to Section 5.4(c), and (c) such other reserves against Eligible Accounts,
Eligible Rentals, Eligible Parts and Tools Inventory, Eligible Rolling Stock,
Eligible Equipment Inventory or Borrowing Availability of such Borrower that
Agent may, in good faith and in its reasonable credit judgment, establish from
time to time. Without limiting the generality of the foregoing, Reserves
established to ensure the payment of accrued Interest Expenses shall be deemed
to be a reasonable exercise of Agent’s credit judgment.

 

“Restricted Payment” means, with respect to any Credit Party, (a) the declaration or
payment of any dividend or the incurrence of any liability to make any other
payment or distribution of cash or other property or assets in respect of such
Credit Party’s Stock; (b) any payment on account of the purchase, redemption,
defeasance, sinking fund or other retirement of such Credit Party’s Stock or
any other payment or distribution made in respect thereof, either directly or
indirectly, (c) any payment or prepayment of principal of, premium, if any, or
interest, fees or other charges on or with respect to, and any redemption,
purchase, retirement, defeasance, sinking fund or similar payment and any claim
for rescission with respect to, any Subordinated Debt; (d) any payment made to
redeem, purchase, repurchase or retire, or to obtain the surrender of, any
outstanding warrants, options or other rights to acquire Stock of such Credit
Party now or hereafter outstanding; (e) any payment of a claim for the
rescission of the purchase or sale of, or for material damages arising from the
purchase or sale of, any shares of such Credit Party’s Stock or of a claim for
reimbursement, indemnification or contribution arising out of or related to any
such claim for damages or rescission; (f) any payment, loan, contribution, or
other transfer of funds or other property to any Stockholder of such Credit
Party other than payment of compensation and directors’ fees in the ordinary
course of business to Stockholders who are employees of such Person; (g) any
payment of management fees (or other fees of a similar nature) by such Credit
Party to any Stockholder of such Credit Party or its Affiliates and (h) any
optional payment or prepayment of principal of me Senior Notes or the Senior
Subordinated Notes, any prepayment of premium, if any, or interest, fees, or
other charges on or with respect to

 

A-27

 

the
Senior Notes or the Senior Subordinated Notes, and any redemption, purchase,
retirement, defeasance, subleasing fund or similar optional payment with
respect to the Senior Notes or
the Senior Subordinated Notes.

 

“Retiree Welfare Plan” means, at any time, a Welfare Plan that provides for continuing
coverage or benefits for any participant or any beneficiary of a participant
after such participant’s termination of employment, other than continuation coverage
provided pursuant to Section 4980B of the IRC and at the sole expense of the
participant or the beneficiary of the participant.

 

“Revolving Credit Advance” has the meaning assigned to it in Section 1.1(a)(i).

 

“Revolving Lenders” means, as of any date of determination,
Lenders having a Revolving Loan Commitment.

 

“Revolving Loan” means, at any time, the sum of (i) the aggregate amount of Revolving
Credit Advances outstanding, as the context may require, to any Borrower or all
Borrowers plus (ii) the aggregate Letter of Credit Obligations incurred
on behalf of any Borrower or all Borrowers. Unless the context otherwise
requires, references to the outstanding principal balance of the Revolving Loan
shall include the outstanding balance of Letter of Credit Obligations. A Letter
of Credit issued for the account of a Borrower shall be included in calculating
the Letter of Credit Obligations of, and consequently the outstanding principal
balance of the Revolving Loan made to, such Borrower.

 

“Revolving Loan Commitment” means (a) as to any Revolving Lender, the aggregate commitment of such
Revolving Lender to make Revolving Credit Advances or incur Letter of Credit
Obligations as set forth on Annex J or in the most recent Assignment Agreement
executed by such Revolving Lender and (b) as to all Revolving Lenders, the
aggregate commitment of all Revolving Lenders to make Revolving Credit Advances
or incur Letter of Credit Obligations, which aggregate commitment shall be One
Hundred Fifty Million Dollars ($150,000,000) on the Closing Date, as such
amount may be adjusted, if at all, from time to time in accordance with the
Agreement, provided, however, mat
in the event that the maximum amount permitted under clause (1) of the
definition of “Permitted Debt” contained in the Senior Note Indenture or the
Senior Subordinated Note Indenture is reduced by virtue of the application to
“Senior Debt” (as defined in the Senior Note Indenture or Senior Subordinated
Note Indenture) of “Net Proceeds” of “Assets Sales” (as such terms are defined
in the Senior Note Indenture or Senior Subordinated Note Indenture), then and
in such event the Revolving Loan Commitment shall be reduced automatically by
the amount of each such reduction, with any such reduction to the Revolving
Loan Commitment to be allocated to all Lenders pro rata.

 

“Revolving Note”
has the meaning assigned to it in Section l.1(a)(ii).

 

“Security Agreements” means each Security Agreement of even date herewith entered into by
and among Agent, on behalf of itself and Lenders, and each Credit Party that is
a signatory thereto.

 

A-28

 

“Senior Debt”
of any Person, means all Indebtedness and Capital Lease Obligations of such
Person, other than Subordinated Debt of such Person.

 

“Senior Debt to Tangible Assets Ratio” means, with respect to any Person for any
fiscal period, the ratio of Senior Debt of such Person to Tangible Assets of
such Person.

 

“Senior Note Indenture” has the meaning assigned to it in the recitals to the Agreement.

 

“Senior Notes”
has the meaning assigned to it in the recitals to the Agreement.

 

“Senior Subordinated Note Indenture” has the meaning assigned to it in the
recitals to the Agreement.

 

“Senior Subordinated Notes” has the meaning assigned to it the recitals to the Agreement. 

 

“Settlement Date” has the meaning assigned to it in Section 9.10(a)(ii).

 

“Software”
means all “software” as such term is defined in the Code, now owned or
hereafter acquired by any Credit Party, other than software embedded in any
category of Goods, including all computer programs and all supporting
information provided in connection with a transaction related to any program.

 

“Solvent”
means, with respect to any Person on a particular date, that on such date (a)
the fair value of the property of such Person is greater than the total amount
of liabilities, including contingent liabilities, of such Person; (b) the
present fair salable value of the assets of such Person is not less than the
amount that will be required to pay the probable liability of such Person on
its debts as they become absolute and matured; (c) such Person does not intend
to, and does not believe that it will, incur debts or liabilities beyond such
Person’s ability to pay as such debts and liabilities mature; and (d) such
Person is not engaged in a business or transaction, and is not about to engage
in a business or transaction, for which such Person’s property would constitute
an unreasonably small capital. The amount of contingent liabilities (such as
litigation, guaranties and pension plan liabilities) at any time shall be
computed as the amount that, in light of all the facts and circumstances
existing at the time, represents the amount that can be reasonably be expected
to become an actual or matured liability.

 

“Stock” means
all shares, options, warrants, general or limited partnership interests,
membership interests or other equivalents (regardless of how designated) of or
in a corporation, partnership, limited liability company or equivalent entity
whether voting or nonvoting, including common stock, preferred stock or any
other “equity security” (as such term is defined in Rule 3a11-1 of the General
Rules and Regulations promulgated by the Securities and Exchange Commission
under the Securities Exchange Act of 1934).

 

“Stockholder”
means, with respect to any Person, each holder of Stock of such Person.

 

“Subject Property” has the meaning assigned to it in Section 7.3.

 

A-29

 

“Subordinated Debt” means Indebtedness evidenced by the Senior Subordinated Notes and any
other Indebtedness of any Borrower subordinated to the Obligations in a manner
and form satisfactory to Agent and Lenders in their sole discretion, as to
right and time of payment and as to any other rights and remedies thereunder.

 

“Subsidiary”
means, with respect to any Person, (a) any corporation of which an aggregate of
more than 50% of the outstanding Stock having ordinary voting power to elect a
majority of the board of directors of such corporation (irrespective of
whether, at the time, Stock of any other class or classes of such corporation
shall have or might have voting power by reason of the happening of any
contingency) is at the time, directly or indirectly, owned legally or
beneficially by such Person or one or more Subsidiaries of such Person, or with
respect to which any such Person has the right to vote or designate the vote of
50% or more of such Stock whether by proxy, agreement, operation of law or
otherwise, and (b) any partnership or limited liability company in which such
Person and/or one or more Subsidiaries of such Person shall have an interest
(whether in the form of voting or participation in profits or capital
contribution) of more than fifty percent (50%) or of which any such Person is a
general partner or may exercise the powers of a general partner. Unless the
context otherwise requires, each reference to a Subsidiary shall be a reference
to a Subsidiary of a Borrower.

 

“Subsidiary Guaranties” means each Subsidiary Guaranty executed by each Subsidiary, of even
date herewith or at any time thereafter, of each Borrower in favor of Agent, on
behalf of itself and Lenders.

 

“Supporting Obligations” means all “supporting obligations” as such term is defined in the
Code, including letters of credit and guaranties issued in support of Accounts,
Chattel. Paper, Documents, General Intangibles, Instruments or Investment
Property.

 

“Swing Line Advance” has the meaning assigned to it in Section 1.1(b)(i).

 

“Swing Line Availability” has the meaning assigned to it in Section 1.1(b)(i).

 

“Swing Line Commitment” means, as to the Swing Line Lender, the commitment of the Swing Line
Lender to make Swing Line Loans as set forth on Annex J which commitment
constitutes a subfacility of the Revolving Loan Commitment of the Swing Line
Lender.

 

“Swing Line Lender” means GE Capital.

 

“Swing Line Loan” means at any time, as the context may require, the aggregate amount of
Swing Line Advances outstanding to any Borrower or to all Borrowers.

 

“Swing Line Note” has the meaning assigned to it in Section 1.1(b)(ii).

 

“Syndication Letter” means the letter agreement of every date herewith among the Borrowers
and the Agent.

 

A-30

 

“Tangible Assets” means, with respect to any Person, all tangible assets of such Person
as of any date of determination calculated in accordance with GAAP.

 

“Target” has
the meaning assigned to it in Section 6.1.

 

“Taxes” means
taxes, levies, imposts, deductions, Charges or withholdings, and all
liabilities with respect thereto, excluding taxes imposed on or measured by the
net income of Agent or a Lender by
the jurisdictions under the laws of which Agent and lenders are organized or
conduct business or any
political subdivision thereof.

 

“Termination Date” means the date on which (a) the Loans have been indefeasibly repaid in
full in cash, (b) all other Obligations (other than contingent obligations for
which no claim has been asserted), under the Agreement and the other Loan
Documents have been completely discharged, (c) all Letter of Credit Obligations
have been cash collateralized, canceled or backed by standby letters of credit
in accordance with Annex B, and (d) none of the Borrowers shall have any
further right to borrow any monies under the Agreement.

 

“Title IV Plan” means an
“employee pension benefit plan” as defined in Section 3(2) of ERISA (other than
a Multiemployer Plan), that is covered by Title IV of ERISA, and that any
Credit Party or ERISA Affiliate maintains, contributes to or has an obligation
to contribute to or has any liability with respect to on behalf of participants
who are or were employed by any of them.

 

“Trademark Security Agreements”
means the Trademark Security Agreements made in favor of Agent, on behalf of
Lenders, by each applicable Credit Party.

 

“Trademark License” means
rights under any written agreement now owned or hereafter acquired by any
Credit Party granting any right to use any Trademark.

 

“Trademarks” means all of the following now owned or hereafter existing, adopted or
acquired by any Credit Party: (a) all trademarks, trade names, limited
liability company names, corporate names, business names, trade styles, service
marks, logos, other source or business identifiers, prints and labels on which
any of the foregoing have appeared or appear, designs and general intangibles
of like nature (whether registered or unregistered), all registrations and
recordings thereof, and all applications in connection therewith, including
registrations, recordings and applications in the United States Patent and
Trademark Office or in any similar office or agency of the United States, any
state or territory thereof, or any other country or any political subdivision
thereof; (b) all reissues, extensions or renewals thereof; and (c) all goodwill
associated with or symbolized by any of the foregoing.

 

“Trustee”
means Bank of New York as trustee for (i) the holders of Senior Notes under the
Senior Note Indenture and (ii) the holders of Senior Subordinated Notes under
the Senior Subordinated Note Indenture.

 

“Unasserted Contingent Obligations” means, at any time, Obligations for taxes, costs, indemnifications,
reimbursements, damages and other liabilities (except for (i) the principal of
and interest and premium (if any) on, and fees relating to, any Indebtedness
and (ii) contingent

 

A-31

 

reimbursement
obligations in respect of amounts that may be drawn under Letters of Credit) in
respect of which no claim or demand for payment has been made (or, in the case
of Obligations for indemnification, no notice for indemnification has been
issued by the indemnitee) at such time.

 

“Unfunded Pension Liability” means, at any time, the aggregate amount, if any, of the sum of the
amount by which the present value of all accrued benefits under each Title IV
Plan exceeds the fair market value of all assets of such Title IV Plan, all
determined as of the most recent valuation date for each such Title IV Plan
using the actuarial assumptions for funding purposes in effect under such Title
IV Plan.

 

“Utilization Rate of Equipment Inventory Ratio” means with respect to any Person for any
fiscal period, the ratio of Equipment Inventory Rental Revenues to Equipment
Inventory Rental Expenditures of such Person for such period.

 

“Vendor Inter-Creditor Agreement” means an agreement in the form of Exhibit
6.7(d)(iii)(A) or Exhibit 6.7(d)(iii)(B), in each case, with such changes
thereto as may be approved by the Agent, between the Agent and the holder of a
purchase money Lien in Equipment Inventory or such other form of intercreditor
agreement as the Agent may approve.

 

“Welfare Plan”
means a Plan described in Section 3(1) of ERISA.

 

Rules of construction with
respect to accounting terms used in the Agreement or the other Loan Documents
shall be as set form in Annex G. All other undefined terms contained in any of
the Loan Documents shall, unless the context indicates otherwise, have the
meanings provided for by the Code to the extent the same are used or defined therein;
in the event that any term is defined differently in different Articles of the
Code, the definition contained in Article 9 shall control. Unless otherwise
specified, references in the Agreement or any of the Appendices to a Section,
subsection or clause refer to such Section, subsection or clause as contained
in the Agreement. The words “herein,” “hereof” and “hereunder” and other words
of similar import refer to the Agreement as a whole, including all Annexes,
Exhibits and Schedules, as the same may from time to time be amended, restated,
modified or supplemented, and not to any particular section, subsection or
clause contained in the Agreement or any such Annex, Exhibit or Schedule.

 

Wherever from the context it
appears appropriate, each term stated in either the singular or plural shall
include the singular and the plural, and pronouns stated in the masculine,
feminine or neuter gender shall include the masculine, feminine and neuter
genders. The words “including”, “includes” and “include” shall be deemed to be
followed by the words “without limitation”; the word “or” is not exclusive;
references to Persons include their respective successors and assigns (to the
extent and only to the extent permitted by the Loan Documents) or, in the case
of governmental Persons, Persons succeeding to the relevant functions of such
Persons; and all references to statutes and related regulations shall include
any amendments of the same and any successor statutes and regulations. Whenever
any provision in any Loan Document refers to the knowledge (or an analogous
phrase) of any Credit Party, such words are intended to signify that such
Credit Party has actual knowledge or awareness of a particular fact or

 

A-32

 

circumstance or that such
Credit Party, if it had exercised reasonable diligence, would have known or
been aware of such fact or circumstance.

 

A-33

 

ANNEX B (Section 1.2)

 

to

 

CREDIT AGREEMENT

 

LETTERS OF CREDIT

 

(a)           Issuance

 

Subject
to the terms and conditions of the Agreement, Agent and Revolving Lenders agree
to incur, from time to time prior to the Commitment Termination Date, upon the
request of Borrower Representative on behalf of the applicable Borrower and for
such Borrower’s account, Letter of Credit Obligations by causing Letters of
Credit to be issued by an L/C Issuer for such Borrower’s account and guaranteed
by Agent; provided, that if the
L/C Issuer is a Revolving Lender, then such Letters of Credit shall not be
guaranteed by Agent but rather each Revolving Lender shall, subject to the
terms and conditions hereinafter set forth, purchase (or be deemed to have
purchased) risk participations in all such Letters of Credit issued with the
written consent of Agent, as more fully described in paragraph (b)(ii) below.
The aggregate amount of all such Letter of Credit Obligations shall not at any
time exceed the least of (i) Ten Million Dollars ($10,000,000) (the “L/C Sublimit”), and (ii) the Maximum Amount less the aggregate outstanding principal
balance of the Revolving Credit Advances and the Swing Line Loan, and (iii) the
Aggregate Borrowing Base less the aggregate outstanding principal
balance of the Revolving Credit Advances and the Swing Line Loan. Furthermore,
the aggregate amount of any Letter of Credit Obligations incurred on behalf of
any Borrower shall not at any time exceed such Borrower’s separate Borrowing
Base less the aggregate principal balance of the Revolving Credit
Advances and the Swing Line Loan to such Borrower. No such Letter of Credit
shall have an expiry date that is more than one year following the date of
issuance thereof, unless otherwise determined by Agent in its sole discretion,
and neither Agent nor Revolving Lenders shall be under any obligation to incur
Letter of Credit Obligations in respect of, or purchase risk participations in,
any Letter of Credit having an expiry date that is later than the date that is
referred to in clause (a) of the definition of Commitment Termination Date. Each
issuance of a Letter of Credit shall be made on notice by Borrower
Representative on behalf of the applicable Borrower to the representative of
Agent identified in Schedule 1.1 at the address specified therein. Any such
notice must be given no later noon (New York time) on the date which is three
(3) Business Days prior to the proposed issuance of such Letter of Credit. Each
such notice (a “Notice of Issuance of Letter of Credit”)
must be given in writing (by telecopy or overnight courier) substantially in
the form of Exhibit B-l(a) and shall include the information required in such
Exhibit and such other administrative information as may be reasonably required
by Agent.

 

(b)           Advances Automatic; Participations

 

(i)            In the event that Agent or any Revolving
Lender shall make any payment on or pursuant to any Letter of Credit
Obligation, such payment shall men be deemed automatically to constitute a
Revolving Credit Advance to the applicable Borrower under Section 1.1(a) of

 

B-1

 

the
Agreement regardless of whether a Default or Event of Default has occurred and
is continuing and notwithstanding any Borrower’s failure to satisfy the
conditions precedent set forth in Section 2, and each Revolving Lender shall be
obligated to pay its Pro Rata Share thereof in accordance with the Agreement.
The failure of any Revolving Lender to make available to Agent for Agent’s own
account its Pro Rata Share of any such Revolving Credit Advance or payment by
Agent under or in respect of a Letter of Credit shall not relieve any other
Revolving Lender of its obligation hereunder to make available to Agent its Pro
Rata Share thereof, but no Revolving Lender shall be responsible for the
failure of any other Revolving Lender to make available such other Revolving
Lender’s Pro Rata Share of any such payment.

 

(ii)           If it shall be illegal or unlawful for any Borrower to incur Revolving
Credit Advances as contemplated by paragraph (b)(i) above because of an Event
of Default described in Section 8.1(h) or Section 8.1(i) or otherwise or if it
shall be illegal or unlawful for any Revolving Lender to be deemed to have
assumed a ratable share of the reimbursement obligations owed to an L/C Issuer,
or if the L/C Issuer is a Revolving Lender, then (A) immediately and without
further action whatsoever, each Revolving Lender shall be deemed to have
irrevocably and unconditionally purchased from Agent (or such L/C Issuer, as
the case may be) an undivided interest and participation equal to such Revolving
Lender’s Pro Rata Share (based on the Revolving Loan Commitments) of the Letter
of Credit Obligations in respect of all Letters of Credit then outstanding and (B)
thereafter, immediately upon issuance of any Letter of Credit, each Revolving
Lender shall be deemed to have irrevocably and unconditionally purchased from
Agent (or such L/C Issuer, as the case may be) an undivided interest and
participation in such Revolving Lender’s Pro Rata Share (based on the Revolving
Loan Commitments) of the Letter of Credit Obligations with respect to such
Letter of Credit on the date of such issuance. Each Revolving Lender shall fund
its participation in all payments or disbursements made under the Letters of
Credit in the same manner as provided in the Agreement with respect to
Revolving Credit Advances.

 

(c)           Cash Collateral

 

(i)            If Borrowers are required to provide cash
collateral for any Letter of Credit Obligations pursuant to the Agreement prior
to the Commitment Termination Date, each Borrower will pay to Agent for the
ratable benefit of itself and Revolving Lenders cash or cash equivalents
acceptable to Agent (“Cash Equivalents”)
in an amount equal to 105% of the maximum amount then available to be drawn
under each applicable Letter of Credit outstanding for the benefit of such
Borrower. Such funds or Cash Equivalents shall be held by Agent in a cash
collateral account (the “Cash Collateral Account”)
maintained at a bank or financial institution acceptable to Agent. The Cash
Collateral Account shall be in the name of the applicable Borrower and shall be
pledged to, and subject to the control of, Agent, for the benefit of Agent and
Lenders, in a manner reasonably satisfactory to Agent. Each Borrower hereby
pledges and grants to Agent, on behalf of itself and Lenders, a security
interest in all such funds and Cash Equivalents held in the

 

B-2

 

Cash
Collateral Account from time to time and all proceeds thereof, as security for
the payment of all amounts due in respect of the Letter of Credit Obligations
and other Obligations, whether or not then due. The Agreement, including this
Annex B, shall constitute a security agreement under applicable law.

 

(ii)           If any Letter of Credit Obligations, whether or not men due and payable,
shall for any reason be outstanding on the Commitment Termination Date,
Borrowers shall either (A) provide cash collateral therefor in the manner
described above, or (B) cause all such Letters of Credit and guaranties
thereof, if any, to be canceled and returned, or (C) deliver a stand-by letter
(or letters) of credit in guaranty of such Letter of Credit Obligations, which
stand-by letter (or letters) of credit shall be of like tenor and duration as,
and in an amount equal to 105% of the aggregate maximum amount then available
to be drawn under, the Letters of Credit to which such outstanding Letter of
Credit Obligations relate and shall be issued by a Person, and shall be subject
to such terms and conditions, as are “ be satisfactory to Agent in its sole
discretion.

 

(iii)          From time to time after funds are deposited in the Cash Collateral
Account by any Borrower, whether before or after the Commitment Termination
Date, Agent may apply such funds or Cash Equivalents then held in the Cash
Collateral Account to the payment of any amounts, and in such order as Agent
may elect, as shall be or shall become due and payable by such Borrower to
Agent and Lenders with respect to such Letter of Credit Obligations of such
Borrower and, upon the satisfaction in full of all Letter of Credit Obligations
of such Borrower, to any other Obligations of any Borrower then due and
payable.

 

(iv)          No Borrower nor any Person claiming on behalf of or through any
Borrower shall have any right to withdraw any of the funds or Cash Equivalents
held in the Cash Collateral Account, except that upon the termination of all
Letter of Credit Obligations and the payment of all amounts payable by
Borrowers to Agent and Lenders in respect thereof, any funds remaining in the
Cash Collateral Account shall be applied to other Obligations then due and
owing and upon payment in full of such Obligations, any remaining amount, shall
be paid to Borrowers or as otherwise required by law. Interest earned on
deposits in the Cash Collateral Account shall be for the account of Agent.

 

(d)           Fees and Expenses

 

Borrowers
agree to pay to Agent for the benefit of Revolving Lenders, as compensation to
such Lenders for Letter of Credit Obligations incurred hereunder, (i) all costs
and expenses incurred by Agent or any Lender on account of such Letter of
Credit Obligations, and (ii) for each month during which any Letter of Credit
Obligation shall remain outstanding, a fee (the “Letter of Credit Fee”) in an
amount equal to the Applicable L/C Margin from time to time in effect
multiplied by me maximum amount available from time to time to be drawn under
the applicable Letter of Credit. Such fee shall be paid to Agent for the
benefit of the Revolving Lenders in arrears, on the first day of each month and
on the Commitment Termination Date. In addition, Borrowers shall pay to any L/C
Issuer, on demand, such fees (including all per annum fees),

 

B-3

 

charges
and expenses of such L/C Issuer in respect of the issuance, negotiation,
acceptance, amendment, transfer and payment of such Letter of Credit or
otherwise payable pursuant to the application and related documentation under
which such Letter of Credit is issued.

 

(e)           Request for Incurrence of Letter of Credit
Obligations

 

Borrower
Representative shall give Agent at least two (2) Business Days’ prior written
notice requesting the incurrence of any Letter of Credit Obligation. The notice
shall be accompanied by the form of the Letter of Credit (which shall be
acceptable to the L/C Issuer). Notwithstanding anything contained herein to the
contrary, Letter of Credit applications by Borrower Representative and
approvals by Agent and the L/C Issuer may be made and transmitted pursuant to
electronic codes and security measures mutually agreed upon and established by
and among Borrower Representative, Agent arid the L/C Issuer.

 

(f)           Obligation Absolute

 

The
obligation of Borrowers to reimburse Agent and Revolving Lenders for payments
made with respect to any Letter of Credit Obligation shall be absolute,
unconditional and irrevocable, without necessity of presentment, demand,
protest or other formalities, and the obligations of each Revolving Lender to
make payments to Agent with respect to Letters of Credit shall be unconditional
and irrevocable. Such obligations of Borrowers and Revolving Lenders shall be
paid strictly in accordance with the terms hereof under all circumstances
including the following:

 

(i)            any lack of validity or enforceability of any
Letter of Credit or the Agreement or the other Loan Documents or any other
agreement;

 

(ii)           the existence of any claim, setoff, defense or other right that any
Borrower or any of its Affiliates or any Lender may at any time have against a
beneficiary or any transferee of any Letter of Credit (or any Persons or
entities for whom any such transferee may be acting), Agent, any Lender, or any
other Person, whether in connection with the Agreement, the Letter of Credit,
the transactions contemplated herein or therein or any unrelated transaction (including
any underlying transaction between any Borrower or any of its Affiliates and
the beneficiary for which the Letter of Credit was procured);

 

(iii)          any draft, demand, certificate or any other document presented under
any 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;

 

(iv)          payment by Agent (except as otherwise expressly provided in paragraph
(g)(ii)(C) below) or any L/C Issuer under any Letter of Credit or guaranty
thereof against presentation of a demand, draft or certificate or other
document that does not comply with the terms of such Letter of Credit or such
guaranty;

 

(v)           any other circumstance or event whatsoever, that is similar to any of
the foregoing; or 

 

(vi)          the fact that a Default or an Event of Default has occurred and is
continuing.

 

B-4

 

(g)          Indemnification; Nature of Lenders’ Duties

 

(i)            In addition to amounts payable as elsewhere
provided in the Agreement, Borrowers hereby agree to pay and to protect,
indemnify, and save harmless Agent and each Lender from and against any and all
claims, demands, liabilities, damages, losses, costs, charges and expenses
(including reasonable attorneys’ fees and allocated costs of internal counsel)
that Agent or any Lender may incur or be subject to as a consequence, direct or
indirect, of (A) the issuance of any Letter of Credit or guaranty thereof, or
(B) the failure of Agent or any Lender seeking indemnification or of any L/C
Issuer to honor a demand for payment under any Letter of Credit or guaranty
thereof 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,
in each case other than to the extent solely as a result of the gross
negligence or willful misconduct of Agent or such Lender (as finally determined
by a court of competent jurisdiction).

 

(ii)           As between Agent and any Lender and Borrowers, Borrowers assume all
risks of the acts and omissions of, or misuse of any Letter of Credit by
beneficiaries of any Letter of Credit. In furtherance and not in limitation of
the foregoing, to the fullest extent permitted by law neither Agent nor any
Lender shall be responsible for: (A) the form, validity, sufficiency, accuracy,
genuineness or legal effect of any document issued by any party in connection
with the application for and issuance of any Letter of Credit, even if it
should in fact prove to be in any or all respects invalid, insufficient,
inaccurate, fraudulent or forged; (B) the validity or sufficiency of any
instrument transferring or assigning or purporting to transfer or assign any
Letter of Credit or the rights or benefits thereunder or proceeds thereof, in
whole or in part, that may prove to be invalid or ineffective for any reason;
(C) failure of the beneficiary of any Letter of Credit to comply fully with
conditions required in order to demand payment under such Letter of Credit; provided that, in the case of any payment
by Agent under any Letter of Credit or guaranty thereof, Agent shall be liable
to the extent such payment was made solely as a result of its gross negligence
or willful misconduct (as finally determined by a court of competent jurisdiction)
in determining that the demand for payment under such Letter of Credit or
guaranty thereof complies on its face with any applicable requirements for a
demand for payment under such Letter of Credit or guaranty thereof; (D) errors,
omissions, interruptions or delays in transmission or delivery of any messages,
by mail, cable, telegraph, telex or otherwise, whether or not they may be in
cipher, (E) errors in interpretation of technical terms; (F) any loss or delay
in the transmission or otherwise of any document required in order to make a
payment under any Letter of Credit or guaranty thereof or of the proceeds
thereof; (G) the credit of the proceeds of any drawing under any Letter of
Credit or guaranty thereof; and (H) any consequences arising from causes beyond
the control of Agent or any Lender. None of the above shall affect, impair, or
prevent the vesting of any of Agent’s or any Lender’s rights or powers
hereunder or under the Agreement.

 

B-5

 

(iii)          Nothing contained herein shall be deemed to limit or to expand any
waivers, covenants or indemnities made by Borrowers in favor of any L/C Issuer
in any letter of credit application, reimbursement agreement or similar
document, instrument or agreement between or among Borrowers and such L/C
Issuer.

 

B-6

 

ANNEX C (Section 1.8)

 

to

 

CREDIT
AGREEMENT

 

CASH
MANAGEMENT SYSTEMS

 

Borrowers shall and shall cause each other Credit Party to establish
and maintain the Cash Management Systems described below:

 

(a)           On or before the Closing Date, and until the
Termination Date, each Borrower shall (i) establish lock boxes (“Lock Boxes”) or at Agent’s discretion,
blocked accounts (“Blocked Accounts”)
at one or more of the banks set forth in Disclosure Schedule (3.19), and
shall request in writing and otherwise take such reasonable steps to ensure
that all Account Debtors (except as set forth below) forward payment directly
to such Lock Boxes, and (ii) deposit and cause its Subsidiaries to deposit
or cause to be deposited promptly, and in any event no later than the first Business
Day after the date of receipt thereof, all cash, checks, drafts or other
similar items of payment relating to or constituting payments made in respect
of any and all Collateral (whether or hot otherwise delivered to a Lock Box)
into one or more Blocked Accounts in such Borrower’s name or any such
Subsidiary’s name and at a bank identified in Disclosure Schedule (3.19)
(each, a “Relationship Bank”). At the request of
Agent, each Borrower shall have established a concentration account in its name
(each a “Concentration Account” and
collectively, the “Concentration Accounts”)
at the bank which shall be designated as the Concentration Account bank for
such Borrower in Disclosure Schedule (3.19) (the “Concentration Account Bank” and,
collectively, the “Concentration Account
Banks”) which bank shall be reasonably satisfactory to Agent and
Borrowers.

 

(b)           Each Borrower may maintain, in its name, an
account (each a “Disbursement Account”
and collectively, the “Disbursement Accounts”)
at a bank reasonably acceptable to Agent into which Agent shall, from time to
time, deposit proceeds of Revolving Credit Advances and Swing Line Advances
made to such Borrower pursuant to Section 1.1 for use by such Borrower
solely in accordance with the provisions of Section 1.4.  No Credit Party shall maintain any deposit account
other than a deposit account that is subject to a Blocked Account Agreement, provided. that until the date forty-five
(45) days following the Closing Date the Credit Parties may maintain not more
than ten deposit accounts that are not subject to a Blocked Account Agreement
so long as no such deposit account has at any time a balance of more than
$5,000.

 

(c)           On or before the Closing Date (or such later
date as Agent shall consent to in writing), each Concentration Account Bank,
each bank where a Disbursement Account is maintained and all other Relationship
Banks, shall have entered into tri-party blocked account agreements with Agent,
for the benefit of itself and Lenders, and the applicable Credit Party and
Subsidiaries thereof, as applicable, in form and substance reasonably
acceptable to Agent, which shall become operative on or prior to the Closing
Date (a “Blocked Account Agreement”). Each such
blocked account agreement shall provide, among other things, mat (i) all
items of payment deposited in

 

C-1

 

such account and proceeds thereof deposited in the applicable
Concentration Account are held by such bank as agent or bailee-in-possession
for Agent, on behalf of itself and Lenders, (ii) the bank executing such
agreement has no rights of setoff or recoupment or any other claim against such
account, as the case may be, other than for payment of its service fees and
other charges directly related to the administration of such account and for
returned checks or other items of payment, and (iii) from and after me
Closing Date (A) with respect to banks at which a Blocked Account is maintained,
such bank-agrees, from and after the receipt of a notice (an “Activation Notice”) from Agent (which
Activation Notice may be given by Agent at any time at which (1) a Default
or Event of Default has occurred and is continuing, (2) Agent reasonably
believes based upon information available to it that a Default or an Event of
Default is likely to occur, (3) Agent reasonably believes that an event or
circumstance that is likely to have a Material Adverse Effect has occurred, or (4) Agent
reasonably has grounds to believe that the integrity of any Credit Party Cash
Management Systems has been compromised or any Credit Party compliance with the
provisions of this Annex C or any other provisions of the Loan Documents to the
extent related to such Cash Management Systems (any of the foregoing being
referred to herein as an “Activation Event”)),
to forward immediately all amounts in each Blocked Account to such Borrower’s
Concentration Account Bank and to commence the process of daily, sweeps from
such Blocked Account into the applicable Concentration Account and (B) with
respect to each Concentration Account Bank, such bank agrees from and after the
receipt of an Activation Notice from Agent upon the occurrence of an Activation
Event, to immediately forward all amounts received in the applicable
Concentration Account to the Collection Account through daily sweeps from such
Concentration Account into the Collection Account. From and after the date
Agent has delivered an Activation Notice to any bank with respect to any
Blocked Account(s), no Credit Party shall, or shall cause or permit any
Subsidiary thereof to, accumulate or maintain cash in Disbursement Accounts or
payroll accounts as of any date of determination in excess of checks
outstanding against such accounts as of that date and amounts necessary to meet
minimum balance requirements.

 

(d)           So long as no Default or Event of Default has
occurred and is continuing, Credit Parties may amend Disclosure Schedule (3.19)
to add or replace a Relationship Bank, Lock Box or Blocked Account or to
replace any Concentration Account or any Disbursement Account; provided, that (i) Agent shall have
consented in writing in advance to the opening of such account or Lock Box with
the relevant bank and (ii) prior to the time of the opening of such
account or Lock Box, the applicable Credit Party or its Subsidiaries, as
applicable, and such bank shall have executed and delivered to Agent a
tri-party blocked account agreement, in form and substance reasonably
satisfactory to Agent. Each Credit Party shall close any of its accounts (and
establish replacement accounts in accordance with the foregoing sentence)
promptly and in any event within thirty (30) days following notice from Agent
that the creditworthiness of any bank holding an account is no longer
acceptable in Agent’s reasonable judgment, or as promptly as practicable and in
any event within sixty (60) days following notice from Agent that the operating
performance, funds transfer or availability procedures or performance with
respect to accounts or Lock Boxes of the bank holding such accounts or Agent’s
liability under any tri-party blocked account agreement with such bank is no
longer acceptable in Agent’s reasonable judgment.

 

C-2

 

(e)           The Lock Boxes, Blocked Accounts,
Disbursement Accounts and the Concentration Accounts shall be cash collateral
accounts, with all cash, checks and other similar items of payment in such
accounts securing payment of the Loans and all other Obligations, and in which the applicable
Credit Party and each Subsidiary thereof shall have granted a Lien to Agent, on
behalf of itself and Lenders, pursuant to its Security Agreement.

 

(f)            All amounts deposited in the Collection
Account shall be deemed received by Agent in accordance with Section 1,10
and shall be applied (and allocated) by Agent in accordance with Section 1.11.
In no event shall any amount be so applied unless and until such amount shall
have been credited in immediately available funds to the Collection Account.

 

(g)           Each Credit Party shall and shall cause-its
Affiliates, officers, employees, agents, directors or other Persons acting for
in concert with such Borrower (each a “Related Person”)
to (i) hold in trust for Agent, for the benefit of itself and Lenders, all
checks, cash and other items or
payment constituting proceeds of Collateral received by such Credit Party or
any such Related Person, and (ii) within one (1) Business Day after
receipt by such Borrower or any such Related Person of any checks, cash or
other items or payment, deposit the same into a Blocked Account of such Credit
Party, Each Credit Party and each Related Person thereof acknowledges and
agrees that all cash, checks or other items of payment constituting proceeds of
Collateral are part of the Collateral. All proceeds of the sale or other disposition
of any Collateral, shall be deposited directly into the applicable Blocked
Accounts.

 

C-3

 

ANNEX D (Section 2.1(a))

 

to

 

CREDIT
AGREEMENT

CLOSING CHECKLIST

 

In addition to, and not in limitation of, the conditions described in Section 2.1
of the Agreement, pursuant to Section 2.l(a), the following items must be
received by Agent in form and substance satisfactory to Agent on or prior to
the Closing Date (each capitalized term used but not otherwise defined herein
has the meaning ascribed thereto in Annex A to the Agreement):

 

(A)          Appendices

 

All Appendices to the Agreement, in form and substance satisfactory to
Agent.

 

(B)          Revolving Notes and Swing Line Note

 

Duly executed originals of the Revolving Notes and Swing Line Notes for
each applicable Lender, dated the Closing Date, if requested by the respective
Lenders.

 

(C)          Security Agreements

 

Duly executed originals of file Security Agreements executed by each
Credit Party, dated the Closing Date, and all instruments, documents and
agreements executed pursuant thereto.

 

(D)          Insurance

 

Satisfactory evidence that the insurance policies required by Section 5.4
are in full force and effect, together with appropriate evidence showing loss
payable and/or additional insured clauses or endorsements, as requested by
Agent, in favor of Agent, on behalf of Lenders.

 

(E)           Security Interests and Code Filings

 

(a)           Evidence satisfactory to Agent that Agent
(for the benefit of itself and Lenders) has a valid and perfected first
priority security interest in the Collateral, including (i) such documents
duly executed by each Credit Party (including financing statements under the
Code and other applicable documents under the laws of any jurisdiction with
respect to the perfection of Liens) as Agent may request in order to perfect
its security interests in the Collateral and (ii) copies of Code search
reports listing all effective financing statements that name any Credit Party
as debtor, together with copies of such financing statements, none of which
shall cover the Collateral, except for those relating to the Prior Obligations
(all of which shall be terminated on the Closing Date) or Permitted
Encumbrances.

 

D-1

 

(b)           Evidence satisfactory to Agent, including
copies, of all UCC-1 and other financing statements filed in favor of any
Credit Party with respect to each location, if any, at which Parts and Tools
Inventory or Equipment Inventory may be consigned.

 

(c)           Control Letters from (i) all issuers of
uncertificated securities and financial assets held by each Borrower, (ii) all
securities intermediaries with respect to all securities accounts and securities
entitlements of each Borrower, and (iii) all futures commission agents and
clearing houses with respect to all commodities contracts and commodities
accounts held by any Borrower.

 

(d)           Notwithstanding the foregoing, each Credit
Party shall take all necessary action (including, without limitation, the
delivery of all certificates of title to Agent and the addition of Agent as a
Lien holder to each such certificate of title), to provide Agent with a first
priority perfected security interest in all P&E covered by a certificate of
title held by such Credit Party as soon as practicable following the Closing
Date; burin no event later than thirty (30) days following the Closing Date.

 

(F)           Payoff Letter; Termination Statements

 

Copies of a duly executed payoff letter, in form and substance
reasonably satisfactory to Agent, by and between all parties to the Prior
Lenders’ loan documents evidencing repayment in full of all Prior Obligations,
together with (a) UCC-3 or other appropriate termination statements, in
form and substance reasonably satisfactory to Agent, manually signed by the Prior
Lenders releasing all liens of Prior Lender upon any of the personal property
of each applicable Credit Party, and (b) termination of all blocked
account agreements, bank agency agreements or other similar agreements or
arrangements or arrangements in favor of Prior Lender or relating to the Prior
Obligations.

 

(G)          Intellectual Property Security Agreements

 

Duly executed originals of Trademark Security Agreements, Copyright
Security Agreements and Patent Security Agreements, each dated the Closing Date
and signed by each Credit Party that owns Trademarks, Copyrights and/or
Patents, as applicable, all in form and substance reasonably satisfactory to
Agent, together with all instruments, documents and agreements executed
pursuant thereto.

 

(H)          Initial Borrowing Base Certificate

 

Duly executed originals of an initial Borrowing Base Certificate from
each Borrower, dated the Closing Date, reflecting information concerning
Eligible Accounts, Eligible Parts and Tools Inventory, Eligible Rolling Stock
and Eligible Equipment Inventory of Borrowers.

 

D-2

 

(I)           Initial Notice of Revolving Credit Advance

 

Duly executed originals of a Notice of Revolving Credit Advance, dated
the Closing Date, with respect to the initial Revolving Credit Date Advance to
be requested by Borrowers on the Closing Date.

 

(J)           Letter of Direction

 

Duly executed originals of a letter of direction from Borrowers
addressed to Agent, on behalf of itself and Lenders, with respect to the
disbursement on the Closing Date of the proceeds of the initial Revolving
Credit Advance.

 

(K)          Cash Management System; Blocked Account
Agreements

 

Evidence satisfactory to Agent that, as of the Closing Date, Cash
Management Systems complying with Annex C to the Agreement have been
established and are currently being maintained in the manner set forth in such
Annex C, together with copies of duly executed tri- party blocked account and
lock box agreements, reasonably satisfactory to Agent, with the banks

as required by Annex C.

 

(L)           Certificate of Formation and Good Standing

 

For each Credit Party, (a) its articles or certificate of
incorporation or certificate of formation, as applicable, and all amendments
thereto, (b) good standing certificates (including verification of tax
status) in its state of incorporation or formation, as applicable, and (c) good
standing certificates (including verification of tax status) and certificates
of qualification to conduct business in each jurisdiction where its ownership
or lease of property or the conduct of its business requires such
qualification, each dated a recent date prior to the Closing Date and certified
by the applicable Secretary of State or other authorized Governmental
Authority.

 

(M)         By-laws and Resolutions

 

For each Credit Party, (a) its by-laws or operating agreement, as
applicable, together with all amendments thereto and (b) resolutions of
such Person’s Board of Directors or Board of Members, as applicable, approving
and authorizing the execution, delivery and performance of the Loan Documents
to which it is a party and the transactions to be consummated in connection
therewith, each certified as of the Closing Date by such Person’s secretary or
an assistant secretary as being in full force and effect without any modification
or amendment.

 

(N)          Incumbency Certificates

 

For each Credit Party, signature and incumbency certificates of the
officers of such Person executing any of the Loan Documents, certified as of
the Closing Date by such Person’s secretary or an assistant secretary as being
true, accurate, correct and complete.

 

D-3

 

(O)          Opinions of Counsel

 

Duly executed originals of opinions of Kirkland & Ellis, New
York counsel for the Credit Parties, together with opinions of Louisiana,
Delaware, Washington and Montana counsel, each in form and substance reasonably
satisfactory to Agent and its counsel, dated the Closing Date, and each
accompanied by a letter addressed to such counsel from the Credit Parties, “authorizing
and directing such counsel to address its opinion to Agent, on behalf of
Lenders, and to include in such opinion an express statement to the effect that
Agent and Lenders are authorized to rely on such opinion.

 

(P)           Pledge Agreements

 

Duly executed originals of each of each of the Pledge Agreements
accompanied by (as applicable) share certificates representing all of the
outstanding Stock being pledged pursuant to such Pledge Agreement and stock
powers for such share certificates executed in blank.

 

(Q)          Accountants’ Letter

 

A letter from the Credit Parties to the independent auditors
authorizing the independent Certified public accountants of the Credit Parties
to communicate with Agent and Lenders in accordance with Section 4.2 and
acknowledging Lenders’ reliance on the auditor’s certification of past and
future Financial Statements.

 

(R)          Appointment of Agent for Service

 

An appointment of CT Corporation as each Credit Party’s agent for
service of process.

 

(S)           Guaranties

 

Duly executed originals of each Guaranty dated the
Closing Date, and all documents, instruments and agreements executed pursuant
thereto.

 

(T)          GE Capital Fee Letter

 

Duly executed originals of the GE Capital Fee Letter
in form and substance satisfactory to GE Capital.

 

(U)          Officer’s Certificate

 

Duly executed originals of a certificate of an Authorized Officer of
each Credit Party, dated the Closing Date, stating that, since December 31,
2001 (a) no event or condition has occurred or is existing which could
reasonably be expected to have a Material Adverse Effect; (b) there has
been no material adverse change in the industry in which any Borrower operates;
(c) no Litigation has been commenced against such Credit Party which, if
successful, would have a Material Adverse Effect or could challenge any of the
transactions contemplated by the Agreement and the other Loan Documents; (d) there
have been no Restricted Payments made by any Credit Party;

 

D-4

 

and (e) there has been no material increase in liabilities,
liquidated or contingent, and no material decrease in assets of any Borrower or
any of its Subsidiaries.

 

(V)          Waivers

 

Landlord waivers and consents, bailee letters and mortgagee agreements
in form and substance reasonably satisfactory to Agent, in each case as
required pursuant to Section 5.9, provided
that to any
one more location as contemplated by Section 5.9 and the various borrowing base definitions.

 

(W)         Appraisals

 

Equipment Inventory Appraisals and P&E Appraisals conducted by an
appraiser reasonably satisfactory to Agent and Borrowers and using a
methodology reasonably satisfactory to Agent, each of which shall be in form
and substance reasonably satisfactory to Agent.

 

(X)          Environmental Reports

 

Agent shall have received such environmental review and audit reports
with respect to the Real Estate of any Credit Party as Agent shall have
requested, and Agent shall be satisfied, in its sole discretion, with the
contents of all such environmental reports.

 

(Y)          Audited Financials; Financial Condition

 

The Financial Statements, Projections and other materials set forth in Section 3.4,
certified by an Authorized Officer of Borrower Representative, in each case in
form and substance reasonably satisfactory to Agent, and Agent shall be
satisfied, in its sole discretion, with all of the foregoing. Agent shall have
further received a certificate of an Authorized Officer of each Borrower, based
on such Pro Forma and Projections, to the effect that (a) such Borrower
will be Solvent upon the consummation of the transactions contemplated herein; (b) the
Pro Forma fairly presents the financial condition of such Borrower as of the
date thereof after giving effect to the transactions contemplated by the Loan
Documents; (c) the Projections are based upon estimates and assumptions
stated therein, all of which such Borrower believes to be reasonable and fair
in light of current conditions and current facts known to such Borrower and, as
of the Closing Date, reflect such Borrower’s good faith and reasonable estimates
of its future financial performance and of the other information projected
therein for the period set forth therein; (d) the Fair Salable Balance
Sheet was prepared on the same basis as the Pro Forma, except that Borrowers’
assets are set forth therein at their fair salable values on a going
concern basis, and the liabilities set forth therein include all contingent
liabilities of Borrower stated at the reasonably estimated present values
thereof; and (e) containing such other statements with respect to the
solvency of such Borrower and matters related thereto as Agent shall request.

 

(Z)          Syndication Letter

 

Duly executed originals of the Syndication Letter in form and substance
satisfactory to GE Capital.

 

D-5

 

(AA)      Inter-Creditor Agreement

 

Duly executed originals of the Inter-Creditor Agreement, and all
documents, instruments and agreements executed pursuant thereto.

 

(BB)        Vendor Liter-Creditor Agreements

 

Duly executed originals of- a Vendor-Inter Creditor Agreement for each
holder of a Lien described in Section 6.7(d) in the form required by
such Section, in each case as required pursuant to Section 6.7(d), provided that Agent may waive this
condition as to any one or more holders of such a Lien within the $17,500,000
limit contemplated by the last proviso to Section 6.7(d).

 

(CC)        Other Documents

 

Such other certificates, documents and agreements respecting and Credit
Party as Agent may, in its sole discretion, request.

 

D-6

 

ANNEX E (Section 4.1
(a))

 

to

 

CREDIT
AGREEMENT

FINANCIAL STATEMENTS AND PROJECTIONS — REPORTING

 

H&E
Holdings and Borrowers shall deliver or cause to be delivered to Agent or to
Agent and Lenders, as indicated, the following:

 

(a)           Monthly Financials

 

To Agent and Lenders, within thirty (30) days after the end of each
Fiscal Month, financial information regarding H&E Holdings and its
Subsidiaries, certified by an Authorized Officer of Borrower Representative,
consisting of consolidated and consolidating, if applicable (i) unaudited
balance sheets as of the close of such Fiscal Month (including a summary of the
outstanding balance of ail Intercompany Notes as of the last day of such Fiscal
Month) and the related statements of income and cash flow and shareholders’
equity for mat portion of the Fiscal Year ending as of the close of such Fiscal
Month and (ii) unaudited statements of income, cash flows and shareholders’
equity for such Fiscal Month, setting forth in comparative form the figures for
the corresponding period in the prior year and the figures contained in the
Projections for such Fiscal Year, all prepared in accordance with GAAP (subject
to normal year-end adjustments). Such financial information shall be
accompanied by (A) a statement in reasonable detail (each, a “Compliance Certificate”) showing the
calculations used in determining compliance with each Financial Covenant which
is tested on a monthly basis as of the end of such Fiscal Quarter, and (B) the
certification of an Authorized Officer of Borrower Representative that (i) such
financial information presents fairly in accordance with GAAP (subject to
normal year-end adjustments) the financial position and results of operations
of H&E Holdings and its Subsidiaries, on a consolidated and consolidating
basis, if applicable, in each case as at the end of such Fiscal Month and for
mat portion of the Fiscal Year then ended and (ii) any other information
presented is true, correct and complete in all material respects and that there
was no Default or Event of Default in existence as of such time or, if a
Default or Event of Default has occurred and is continuing, describing the
nature thereof and all efforts undertaken to cure such Default or Event of
Default

 

(b)           Quarterly Financials

 

To Agent and Lenders, within forty-five (45) days after the end of each
Fiscal Quarter, consolidated and consolidating, if applicable, financial
information regarding H&E Holdings and its Subsidiaries, certified by an
Authorized Officer of Borrower Representative, including (i) unaudited
balance sheets as of the close of such Fiscal

 

E-1

 

Quarter and the related statements of income and cash flow for that
portion of the Fiscal Year ending as of the close of such Fiscal Quarter and (ii) unaudited
statements of income and cash flows for such Fiscal Quarter, in each case
setting forth in comparative form, the figures for the corresponding period in
the prior year and the figures contained in the Projections for such Fiscal
Year, all prepared in accordance with GAAP (subject to normal year-end
adjustments). Such financial information shall be accompanied by (A) a
Compliance Certificate in respect of each of the Financial Covenants that are
tested on a quarterly basis as at the end of such Fiscal Quarter and (B) the
certification of an Authorized Officer of Borrower Representative that (i) such
financial information presents fairly in accordance with GAAP (subject to
normal year-end adjustments) the financial position, results of operations and
statements of cash flows of H&E Holdings and its Subsidiaries, on both a
consolidated and consolidating basis, if applicable, as at the end of such
Fiscal Quarter and for that portion of the Fiscal Year then ended, (ii) any
other information presented is true, correct and complete in all material
respects and that there was no Default or Event of Default in existence as of
such time or, if a Default or Event of Default has occurred and is continuing,
describing the nature thereof and all efforts undertaken to cure such Default
or Event of Default.  In addition,
H&E Holdings and Borrowers shall deliver to Agent and Lenders, within
forty-five (45) days after the end of each Fiscal Quarter, a management
discussion and analysis that includes a comparison to budget for mat Fiscal
Quarter and a comparison of performance for that Fiscal Quarter to the
corresponding period in the prior year.

 

(c)           Operating Plan

 

To Agent and Lenders, as soon as available, but not later man forty-five
(45) days after the end of each Fiscal Year, an annual operating plan for
H&E Holdings and its Subsidiaries, on a consolidated and consolidating
basis, approved by the Board of Directors of H&E Holdings, (a) for the
first Fiscal Year following the Closing Date, which (i) includes a
statement of all of the material assumptions on which such plan is based and (ii) includes
monthly balance sheets, a monthly budget, income statements and statements of
cash flow for the following year and (b) for the four Fiscal Years
thereafter, which (i) includes a statement of all of the material
assumptions on which such plan is based and (ii) includes monthly balance
sheets, a monthly budget, income statements and statements of cash flow for the
following year, and in each such case, integrates sales, gross profits,
operating expenses, operating profit, cash flow projections and Borrowing
Availability projections, all prepared on the same basis and in similar detail
as that on which operating results are reported (and in the case of cash flow
projections, representing management’s good faith estimates of future financial
performance based on historical performance), and including plans for
personnel, Capital Expenditures and facilities.

 

E-2

 

(d)           Annual Audited Financials

 

To Agent and Lenders, within ninety (90) days after the end of each
Fiscal Year, audited Financial Statements for H&E Holdings and its
Subsidiaries on a consolidated and (unaudited) consolidating basis, if applicable,
consisting of balance sheets and statements of income and retained earnings and
cash flows, setting forth in comparative form in each case the figures for the
previous Fiscal Year which Financial Statements shall be prepared in accordance
with GAAF and certified without qualification, by an independent certified
public accounting firm of national standing or otherwise acceptable to Agent Such
Financial Statements shall be accompanied by (i) a statement prepared in
reasonable detail showing the calculations used in determining compliance with
each of the Financial Covenants as of the end of such such Fiscal Year, (ii) a
report from such accounting firm to the effect that, in connection with their
audit examination, nothing has come to their attention to cause them to believe
that a Default or Event of Default has occurred (or specifying those Defaults
and Events of Default that they became aware of), it being understood that such
audit examination extended only to accounting matters and that no special
investigation was made with respect to the existence of Defaults or Events of
Default, (iii) a letter addressed to Agent, on behalf of itself and
Lenders, in form and substance reasonably satisfactory to Agent and subject to
standard qualifications required by nationally recognized accounting firms,
signed by such accounting firm acknowledging that Agent and Lenders are
entitled to rely upon such accounting firm’s certification of such audited
Financial Statements, (iv) the annual letters to such accountants in
connection with their audit examination detailing contingent liabilities and material
litigation matters, and (v) the certification of an Authorized Officer of
Borrower Representative that all such Financial Statements present fairly in
accordance with GAAP the financial position, results of operations and
statements of cash flows of H&E Holdings and its Subsidiaries on a
consolidated and consolidating basis, if applicable, as at the end of such
Fiscal Year and for the period men ended, and that there was no Default or
Event of Default in existence as of such time or, if a Default or Event of
Default has occurred and is continuing, describing the nature thereof and all
efforts undertaken to cure such Default or Event of Default.

 

(e)           Management Letters

 

To Agent and Lenders, within ten (10) Business Days after receipt
thereof by any Credit Party, copies of all management letters, exception
reports or similar letters or reports received by such Credit Party from its
independent certified public accountants.

 

(f)            Default Notices

 

To Agent and Lenders, as soon as practicable, and in any event within
five (5) Business Days after an executive officer of any Credit Party has
actual knowledge of the existence of any Default, Event of Default or other
event that has had a Material Adverse Effect, telephonic or telecopied notice
specifying the nature of such Default or Event of Default

 

E-3

 

or other event, including the anticipated effect thereof, which notice,
if given telephonically, shall be promptly confirmed in writing on the next
Business Day.

 

(g)           SEC Filings and Press Releases

 

To Agent and Lenders, promptly upon their becoming available, copies “of:
(i) all Financial Statements, reports, notices and proxy statements made
publicly available by any Credit Party to its security holders; (ii) all
regular and periodic reports and all registration statements and prospectuses,
if any, filed by any Credit Party with any securities exchange or with the
Securities and Exchange Commission or any governmental regulatory authority;
and (iii) all press releases and other statements made available” by any
Credit Party” to the” public concerning material adverse changes or
developments in the business of such Credit Party.

 

(h)           Subordinated.Debt, Senior Notes and Equity
Notices

 

To Agent and Lenders, as soon as practicable, copies of all material
written notices given or received by any Credit Party with respect to any
Subordinated Debt (including the Senior Subordinated Notes), the Senior Notes
or Stock of such Credit Party, and, within two (2) Business Days after
such Credit Party obtains knowledge of any matured or unmatured event of
default with respect to any Subordinated Debt (including the Senior
Subordinated Notes), or the Senior Notes, notice of such event of default.

 

(i)            Supplemental Schedules

 

To Agent, supplemental disclosures, if any, required by Section 5.6.

 

(j)            Litigation

 

To Agent and Lenders in writing, promptly upon learning thereof,
written notice of any Litigation commenced or threatened against any Credit
Party that (i) seeks damages in excess of $500,000, (ii) seeks
injunctive relief, (iii) is asserted or instituted against any Plan, its
fiduciaries or its assets or against any Credit Party or ERISA Affiliate in
connection with any Plan, (iv) alleges criminal misconduct by any Credit
Party, or (v) alleges the violation of any law regarding, or seeks
remedies in connection with, any Environmental Liabilities or (vi) involves
any product recall.

 

(k)           Insurance Notices

 

To Agent, disclosure of losses or casualties required by Section 5.4.

 

(1)           Default and Other Notices

 

To Agent and Lenders, within five (5) Business Days after receipt
thereof, copies of (i) any and all default notices received under or with respect
to any leased location or

 

E-4

 

public warehouse where Collateral is located, and (ii) such other
notices or documents as Agent may reasonably request.

 

(m)          Lease Amendments

 

To Agent within five (5) Business Days after the receipt thereof,
copies of all material amendments to any of the five (5) largest real
estate leases (by the value of annual payments of the real estate so leased) or
to any real estate lease to which Don Wheeler or John Engquist is a lessor.

 

(n)           Other Documents

 

To Agent Lenders, such “other financial and other information
respecting any Credit Party’s business or financial condition as Agent or any
Lender shall, from time to time, reasonably request.

 

E-5

 

ANNEX F (Section 4.1(b))

 

to

 

CREDIT
AGREEMENT

COLLATERAL REPORTS

 

Borrowers
shall deliver or cause to be delivered the following:

 

(a)           To Agent, upon its request,
and in no event less frequently than ten (10) Business Days after the end
of each Fiscal Month (together with a copy of all or any part of the following
reports requested by any Lender in writing after the Closing Date), each of the
following reports, each of which shall be prepared by me applicable Borrower as
of the last day of the immediately preceding Fiscal Month or the date two (2) days
prior to the date of any such request:

 

(i)            a Borrowing Base Certificate with respect to
each Borrower, in each case accompanied by such supporting detail and
documentation as shall be requested by Agent in its reasonable discretion;

 

(ii)           with respect to each Borrower, a summary of
Parts and Tools Inventory and Equipment Inventory by branch location and type
with a supporting perpetual Parts and Tools Inventory and Equipment Inventory
report, in each case accompanied by such supporting detail and documentation as
shall be requested by Agent in its reasonable discretion;

 

(iii)          with respect to each Borrower, a monthly
trial balance showing Accounts outstanding aged from invoice due date as
follows: 1 to 30 days, 31 to 60 days, 61 to 90 days and 91 days or more,
accompanied by such supporting detail and documentation as shall be requested by
Agent in its reasonable discretion; and

 

(iv)          with respect to each Borrower, a report
describing outstanding Equipment Inventory
rentals for such period and the Equipment Inventory subject thereto.

 

(b)           To Agent, on a weekly basis or at such more
frequent intervals as Agent may request from time to time (together with a copy
of all or any part of such delivery requested by any Lender in writing after
the Closing Date), collateral reports with respect to each Borrower, including
all additions and reductions (cash and non-cash) with respect to Accounts of
each Borrower, in each case accompanied by such supporting detail and
documentation as shall be requested by Agent in its reasonable discretion each
of which shall be prepared by the applicable Borrower as of the last day of the
immediately preceding week or the date 2 days prior to the date of any such request;

 

(c)           To Agent, at the time of delivery of each of
the monthly Financial Statements delivered pursuant to Annex E:

 

(i)            a reconciliation of the Accounts trial
balance of each Borrower to such Borrower’s most recent Borrowing Base
Certificate, general ledger and monthly Financial

 

F-1

 

Statements delivered pursuant to Annex E, in each case accompanied by
such supporting detail and documentation as shall be requested by Agent in its
reasonable discretion;

 

(ii)           a reconciliation of the perpetual inventory
by branch location of each Borrower to such Borrower’s most recent Borrowing
Base Certificate, general ledger and monthly Financial Statements delivered
pursuant to Annex E, in each case accompanied by such supporting detail and documentation as shall be requested by Agent in its reasonable
discretion;

 

(iii)          an aging of accounts payable and a
reconciliation of mat accounts payable aging to each Borrower’s general ledger
and monthly Financial Statements delivered pursuant to Annex E, in each case
accompanied by such supporting detail and documentation as shall be requested
by Agent in its reasonable discretion; and

 

(iv)          a reconciliation of the outstanding Loans as
set forth in the monthly Loan Account statement provided by Agent to each
Borrower’s general ledger and monthly Financial Statements
delivered pursuant to Annex E, in each case accompanied by such supporting
detail and documentation as shall be requested by Agent in its reasonable
discretion;

 

(d)           To Agent, at the tune of delivery of each of
the quarterly Financial Statements delivered pursuant to Annex E, (i) a
listing of government contracts of each Borrower subject to the Federal Assignment
of Claims Act of 1940; and (ii) a list of any applications for the
registration of any Patent, Trademark or Copyright filed by any
Credit Party with the United States Patent and Trademark Office, the United
States Copyright Office or any similar office or agency in the prior Fiscal
Quarter;

 

(e)           Each Borrower, at its own expense, shall
deliver to Agent the results of each physical verification, if any, that such
Borrower or any of its Subsidiaries may in their discretion have made, or
caused any other Person to have made on their behalf, of all or any portion of
their Parts and Tools Inventory or Equipment Inventory (and, if an Event of
Default has occurred and is continuing, each Borrower shall, upon the request
of Agent, conduct, and deliver the results of, such physical verifications as
Agent may require);

 

(f)            Each Borrower, at its own expense, shall
deliver to Agent monthly, a fleet utilization report, prepared on a “days
rented” basis, or on such other basis or format as is reasonably acceptable to the
Agent;

 

(g)           Each Borrower, at its own expense, shall deliver
to Agent the Equipment Inventory Appraisal, the P&E Appraisal and such
other appraisals of its assets as Agent may request at any time after the occurrence
and during the continuance of a Default or an Event of Default, such appraisals
to be conducted by an appraiser, and in form and substance, reasonably
satisfactory to Agent; and

 

(h)           Such other reports, statements and
reconciliations with respect to the Borrowing Base, Collateral or Obligations
of any Borrower or any other Credit Party as Agent shall from time to time
request in its reasonable discretion.

 

F-2

 

ANNEX G (Section 6.10)

 

to

 

CREDIT
AGREEMENT

FINANCIAL COVENANTS

 

Neither H&E Holdings nor any Subsidiary
thereof shall breach or fail to comply with any of the following financial
covenants, each of which shall be calculated in accordance with GAAP
consistently applied:

 

(a)           Maximum Senior Debt to Tangible
Assets Ratio. H&E
Holdings and its Subsidiaries shall have on a consolidated basis at the end of
each Fiscal Quarter, a Senior Debt to Tangible Assets Ratio as of the last day
of such Fiscal Quarter of not more than 1.10 to 1.00 for such Fiscal Quarter.

 

(b)           Maximum Leverage Ratio. H&E Holdings and its Subsidiaries on a
consolidated basis shall have, at the end of each Fiscal Quarter set forth
below, a Leverage Ratio as of the last day of such Fiscal Quarter and for the 12-month
period then ended of not more than the following:

 

	
  4.60 to 1.00

  	
  for
  each Fiscal Quarter ending on or prior to December 31, 2004;

  
	
  4.25 to 1.00

  	
  for
  each Fiscal Quarter ending thereafter.

  

 

(c)           Maximum Adjusted Leverage Ratio. H&E Holdings and its Subsidiaries on a
consolidated basis shall have, at the end of each Fiscal Quarter set forth
below, an Adjusted Leverage Ratio as of the last day of such Fiscal Quarter and
for the 12-month period then ended of not more than the following:

 

	
  4.60 to 1.00

  	
  for
  each Fiscal Quarter ending on or prior to December 31, 2004;

  
	
  4.40 to 1.00

  	
  for
  each Fiscal Quarter ending thereafter.

  

 

(d)          Minimum Utilization Rate of
Equipment Inventory Ratio.
H&E Holdings and its Subsidiaries shall have on a consolidated basis at the
end of each Fiscal Quarter set forth below, a Utilization Rate of Equipment
Inventory Ratio for the 12-month period then ended of not less than 28% for such
Fiscal Quarter.

 

(e)           Minimum Adjusted Interest
Coverage Ratio. H&E
Holdings and its Subsidiaries on a consolidated basis shall have at the end of
each Fiscal Quarter set forth below, an Adjusted Interest Coverage Ratio for the
12-month period then ended of not less than the following:

 

	
  1.45 to 1.00

  	
  for
  each Fiscal Quarter ending on or prior to March 31, 2004;

  
	
  1.50 to 1.00

  	
  for
  each Fiscal Quarter ending on or after June 30, 2004 and on or prior to
  December 31, 2004;

  
	
  1.60 to 1.00

  	
  for
  each Fiscal Quarter ending thereafter.

  

 

G-1

 

(f)            Maximum P&E Capital
Expenditures.  H&E Holdings and its Subsidiaries on a
consolidated basis shall not make P&E Capital Expenditures during any Fiscal
Year that exceed in the aggregate $5,000,000 for such Fiscal Year.

 

Unless otherwise specifically provided herein, any
accounting term used in the Agreement has the meaning customarily given such
term in accordance with GAAP, and all financial computations hereunder shall be
computed in accordance with GAAP consistently applied. That certain items or
computations are explicitly modified by the phrase “in accordance with GAAP”
shall in no way be construed to limit the foregoing. If any “Accounting Changes”
(as defined below) occur and such changes result in a change in the calculation
of the financial covenants, standards or terms used in the Agreement or any
other Loan Document, then Borrowers, Agent and Lenders agree to enter into
negotiations in order to amend such provisions of the Agreement so as to
equitably reflect such Accounting Changes with the desired result that the
criteria for evaluating Borrowers’ and their Subsidiaries’ financial condition
shall be the same after such Accounting Changes as if such Accounting Changes
had not been made; provided, that
the agreement of Requisite Lenders to any required amendments of such
provisions shall be sufficient to bind all Lenders. “Accounting Changes” means (a) changes in accounting
principles required by the promulgation of any rule, regulation, pronouncement
or opinion by the Financial Accounting Standards Board of the American
Institute of Certified Public Accountants (or successor thereto or any agency
with similar functions), (b) changes in accounting principles concurred in
by any Borrower’s certified public accountants; (c) purchase accounting
adjustments under A.P.B. 16 or 17 and EITF 88-16, and the application of the
accounting principles set forth in FASB 109, including the establishment of reserves
pursuant thereto and any subsequent reversal (in whole or in part) of such
reserves; and (d) the reversal of any reserves established as a result of
purchase accounting adjustments. All such adjustments resulting from
expenditures made subsequent to the Closing Date (including capitalization of
costs and expenses or payment of pre-Closing Date liabilities) shall be treated
as expenses in the period the expenditures are made and deducted as part of the
calculation of EBITDA in such period. If Agent, Borrowers and Requisite Lenders
agree upon the required amendments, then after appropriate amendments have been
executed and the underlying Accounting Change with respect thereto has been
implemented, any reference to GAAP contained in the Agreement or in any other
Loan Document shall, only to the extent of such Accounting Change, refer to
GAAP, consistently applied after giving effect to the implementation of such
Accounting Change. If Agent, Borrowers and Requisite Lenders cannot agree upon
the required amendments within thirty (30) days following the date of
implementation of any Accounting Change, then all Financial Statements
delivered and all calculations of financial covenants and other standards and
terms in accordance with the Agreement and the other Loan Documents shall be
prepared, delivered and made without regard to the underlying Accounting
Change. For purposes of Section 8.1, a breach of a Financial Covenant
contained in this Annex G shall be deemed to have occurred as of any date of
determination by Agent as of the last day of any specified measurement period,
regardless of when the Financial Statements reflecting such breach are
delivered to Agent.

 

G-2

 

ANNEX H (Section 9.10(a))

 

to

 

CREDIT
AGREEMENT

LENDERS’ WIRE TRANSFER INFORMATION

 

	
  Name:

  	
  General
  Electric Capital Corporation

  
	
  Bank:

  	
  Bankers
  Trust Company

  
	
   

  	
  New
  York, New York

  
	
  ABA#:

  	
  021001033

  
	
  Account
  #:

  	
  50232854

  
	
  Account
  Name:

  	
  GECC/CAF
  Depository

  
	
  Reference:

  	
  CFC
  [4121]

  
	
   

  	
   

  
	
  Name:

  	
  Bank
  of America Business, N.A.

  
	
  Bank:

  	
  Bank
  of America, N.A.

  
	
  ABA
  #:

  	
  121-000-358

  
	
  Account
  #:

  	
  1235303848

  
	
  Account
  Name:

  	
  Bank
  of America Business Credit

  
	
  Reference:

  	
  H&E
  Equipment

  
	
   

  	
   

  
	
  Name:

  	
  Fleet
  Capital Corporation

  
	
  Bank:

  	
  Fleet
  National Bank

  
	
  ABA
  #:

  	
  011-900-571

  
	
  Account
  #:

  	
  936-933-7579

  
	
  Account
  Name:

  	
  For
  Credit To: Fleet Capital NE Collections

  
	
  Reference:

  	
  H&E
  Finance

  
	
   

  	
   

  
	
  Name:

  	
  LaSalle
  Business Credit, IDC.

  
	
  Bank:

  	
  LaSalle
  National Bank

  
	
  ABA
  #:

  	
  071000505

  
	
  Account
  #:

  	
  5800333378

  
	
  Account
  Name:

  	
  LaSalle
  Business Credit, Inc.

  
	
  Reference:

  	
  Head &
  Engquist Participation

  
	
   

  	
   

  
	
  Name:

  	
  ORIX
  Financial Services, Inc.

  
	
  Bank:

  	
  Mellon
  Bank

  
	
  ABA
  #:

  	
  043-000-261

  
	
  Account
  #:

  	
  050-2481

  
	
  Account
  Name;

  	
  ORIX
  Financial Services, Inc.

  
	
  Reference:

  	
  H&E
  Equipment Services

  

 

H-1

 

	
  Name:

  	
  PNC
  Bank National Association

  
	
  Bank:

  	
  PNC
  Bank

  
	
  ABA
  #:

  	
  031207607

  
	
  Account
  #:

  	
  196039957830

  
	
  Account
  Name:

  	
  PNC
  Business Credit

  
	
  Reference:

  	
  H&E
  Equipment Services

  

 

H-2

 

ANNEX I (Section 11.10)

 

to

 

CREDIT
AGREEMENT

NOTICE ADDRESSES

 

(A)          If to Agent or GE
Capital, at:

 

General Electric Capital Corporation

Capital Funding, Inc.

335 Madison Avenue

12th Floor

New York, NY 10017

Attention: H&E Equipment Services L.L.C.
Account Manager

Telephone No.: (212)370-8047

Telecopier No.: (212)682-6031

 

with copies to:

 

General Electric Capital Corporation

Capital Funding, Inc.

777 Long Ridge, Building B, First Floor

Stamford, CT 06927

Attention: Corporate Counsel

Telephone No.: (203)357-3159

Telecopier No.: (203) 703-1777

 

and:

 

General Electric Capital Corporation

201 High Ridge Road

Stamford, CT 06927-5100

Attention: Corporate Counsel

Telephone No.: (203) 316-7552

Telecopier No.: (203) 316-7889

 

and:

 

Clifford Chance Rogers & Wells LLP

200 Park Avenue

New York, NY 10166

Attention: Robert S. Finley

Telephone No.: (212) 878-3194

Telecopier No.: (212) 878-8375

 

and

 

I-1

 

General Electric Capital Corporation, Commercial Equipment Finance

44 Old Ridgebury Road

Danbury, CT 06810

Attention: Steve Kopitskie

Telephone No.: (203) 796-2393

Telecopier No.: (212) 796-2352

 

(B)          If to a Lender other than GE Capital, at the
following, as applicable:

 

PNC Bank, National
Association

One PNC Plaza

249 Fifth Avenue - 6th Floor

Pittsburgh, PA 15222

Attention: Doug Hoffman

Telephone No.: (412) 768-1333

Telecopier No.: (212) 768-4369

 

LaSalle Business Credit, Inc.

One Centerpointe Drive

Suite 500

Lake Oswego, OR 97035

Attention: David G. Wilson

Telephone No.: (503) 431-6142

Telecopier No.: (503) 684-4665

 

Fleet Capital Corporation

1633 Broadway

29th
Floor

New York, NY 10019

Attention: David Fiorito

Telephone No.: (646) 366-4374

Telecopier No.: (646) 366-4395

 

Orix Financial Services, Inc.

1177 Avenue of the Americas

10th Floor

New York, NY 10036

Telephone No.: (212) 739-1716

Telecopier No.: (212) 739-1523

 

I-2

 

Bank of America, N.A.

335 Madison Avenue

6th Floor

New York, NY 10017

Attention: Ed Kahn

Telephone No.: (212) 503-7370

Telecopier No.: (212) 503-7340

 

(C)          If to any Credit Party, to Borrower Representative at:

H&E Equipment Services L.L.C.

11100 Mead Road, Suite 200

Baton Rouge, LA 70816

Attention: Terry Eastman

Telecopier No.: (225) 298-5232

Telephone No.: (225) 298-5332

 

I-3

 

ANNEX J
(from Annex A – Commitments definition)

 

to

 

CREDIT
AGREEMENT

 

	
  Lender(s):

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  General
  Electric Capital Corporation

  	
   

  	
   

  
	
  Revolving
  Loan Commitment:

  	
   

  	
  $

  	
  50,000,000

  
	
  Swing Line Commitment:

  	
   

  	
  $

  	
  10,000,000

  
	
   

  	
   

  	
   

  
	
  PNC
  Bank. National Association

  	
   

  	
   

  
	
  Revolving
  Loan Commitment

  	
   

  	
  $

  	
  20,000,000

  
	
   

  	
   

  	
   

  
	
  LaSalle
  Business Credit, Inc.

  	
   

  	
   

  
	
  Revolving
  Loan Commitment:

  	
   

  	
  $

  	
  15,000,000

  
	
   

  	
   

  	
   

  
	
  Fleet
  Capital Corporation

  	
   

  	
   

  
	
  Revolving
  Loan Commitment:

  	
   

  	
  $

  	
  30,000,000

  
	
   

  	
   

  	
   

  
	
  Orix
  Financial Services, Inc.

  	
   

  	
   

  
	
  Revolving
  Loan Commitment:

  	
   

  	
  $

  	
  10,000,000

  
	
   

  	
   

  	
   

  
	
  Bank
  of America, N.A.

  	
   

  	
   

  
	
  Revolving
  Loan Commitment:

  	
   

  	
  $

  	
  25,000,000

  
					

 

J-1

 

	
  [LOGO]

  	
  RENTAL
  AGREEMENT      NO:

  	
   

  

 

A Division of ICM Equipment Company
L.L.C. (hereinafter “ICM”)

4010 South 22nd Street - Phoenix,
AZ 85040 - 602-232-0608 PHOENIX - TUCSON - ALBUQUERQUE - FARMINGTON - EL PASO

 

	
  ACCT NO.

  	
  FED. I.D. NO.

  	
  SHIPPED

  FROM

  	
  CREDIT

  APPROVAL

  
	
   

  	
   

  	
  S

  	
   

  	
  OPEN 

  
	
   

  	
   

  	
  H

  	
   

  	
  ACCT

  
	
   

  	
   

  	
  I

  	
   

  	
   

  
	
   

  	
   

  	
  P

  	
   

  	
  C.O.D.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  T

  	
   

  	
   

  
	
   

  	
   

  	
  O

  	
   

  	
   

  
	
  DATE

  	
  CUST. ORD. NO.

  	
  ORDERED BY

  	
  TELEPHONES

  	
  SALESMAN

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  RENTAL ITEM

  
	
  MAKE

  	
  MODEL

  	
  SERIAL NUMBER

  	
  I.D. NO.

  	
  DESCRIPTION

  	
  REPLACEMENT
  VALUE

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  DIAL INSTRUCTIONS:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  RENTAL TIME

  	
  DELIVERY/RETURN

  
	
  DATE

  	
  SERV. METER

  	
   

  	
   

  	
  OUT

  	
  RETURN

  
	
   

  	
   

  	
  IN

  	
  VIA

  	
   

  	
  VIA

  
	
   

  	
   

  	
  OUT

  	
  DATE

  	
   

  	
  DATE

  
	
   

  	
   

  	
  TOTAL

  	
  B/L NO.

  	
   

  	
  B/L NO.

  
	
   

  	
   

  	
  STANDARD
  USAGE IS HOURS PER DAY. 40 HOURS PER WEEK, OR 176 HOURS PER MONTH. OVERTIME
  USAGE IS DETERMINED BY SERVICE METER HOUR READINGS. THE CONTRACT SHALL EXTEND
  BE-YOND THE TERM, AT THE SAME TERMS, IF THE LESSEE HOLDS THE MACHINE OVER THE
  SPECIFIED TERM OF THE LEASE. 

  	
   

  	
  INSPECTION

  	
   

  
	
  IMATED RETURN DATE

  	
   

  	
  OUT

  	
  ITEM

  	
  RETURN

  
	
  RENTAL CHARGES

  	
   

  	
   

  	
  MAST

  	
   

  
	
  DAYS

  	
  @
  $

  	
   

  	
   

  	
  GLASS

  	
   

  
	
  WEEKS

  	
  @
  $

  	
   

  	
   

  	
  OUT RIGGERS

  	
   

  
	
  MONTH

  	
  @
  $

  	
   

  	
   

  	
  HEADACHE BALL

  	
   

  
	
  OVERTIME

  	
  @ $

  	
   

  	
   

  	
  HOCK BLOCK

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  SAFETY OPERATION MANUAL

  	
   

  
	
  SICAL DAMAGE WAIVER 

  	
     $

  	
   

  	
  LESSEE MUST CHECK ENGINE OIL, WATER AND FUEL DAILY
  LESSEE AUTHORIZES THE DELETION OF ANY SAFETY EQUIPMENT AND ACCEPTS ALL
  LIABILITY FOR ANY INJURY OR LOSS INCURRED. LESSEE IS RESPONSIBLE FOR ALL TIRE
  MAINTENANCE, FUEL, MISSING PARTS AND ALL DAMAGE OTHER THAN NORMAL WEAR.
  LESSEE IS RESPONSIBLE FOR THE PHYSICAL CLEANLINESS OF LEASED EQUIPMENT AND
  THE EVENT UNCLEAN EQUIPMENT IS RETURNED IT WILL BE CLEANED BY LESSOR AT THE
  LESSEES EXPENSE.

  IF LESSEE RETURNS EQUIPMENT WITH LESS THAN A FULL
  TANK OF FUEL IT WILL BE REFUELED AND CHARGED TO LESSEE.

  	
   

  	
  OPERATOR TRAINING RECEIVED

  	
   

  
	
   

  	
   

  	
   

  	
  FORKS

  	
   

  
	
   

  	
   

  	
   

  	
  GAUGES

  	
   

  
	
  PAGE

  	
   

  	
   

  	
  SEAT

  	
   

  
	
   

  	
   

  	
   

  	
  LP TANK

  	
   

  
	
    STATE SALES TAX 

  	
     $        %

  	
   

  	
   

  	
  BATTERY

  	
   

  
	
  FILING FEE

  	
     $

  	
   

  	
   

  	
  COOLANT

  	
   

  
	
  AL DAMAGE WAIVER (off highway
  usage only) WILL INITIAL BLOW TO DECLINE THE OPTIONAL AL DAMAGE WAIVER AT THE
  RATE SHOWN UNDER RENTAL CHARGES SECTION FOR EACH EK MONTH OR FRACTION
  THEREOF:

      DECLINE

  	
   

  	
   

  	
  BRAKES

  CABLES

  FUEL TANK FULL

  BATTERY
COOLANT

  BRAKES

  CABLES

  FUEL TANK FULL
LIGHTS

  	
   

  
	
     THE TERMS AND CONDITIONS ARE SO
  IN THE SPECIAL INSTRUCTIONS ABOVE. THE HAS NO OPTION TO PURCHASE THE
  EQUIP-RENTED ON THIS RENTAL AGREEMENT.

  	
   

  	
  LESSEE IS RESPONSIBLE FOR THE MAINTENANCE OF THIS
  EQUIPMENT WHILE IN THEIR POSSESSION: ANY DAMAGE TO THIS EQUIPMENT RESULTING
  FROM IMPROPER CARE OR MAINTENANCE WILL BE CHARGED DIRECTLY TO LESSEE.

  	
   T

     I

      R

        E

        S

  	
  LF

  

  

  

  LR.

  	
  RF:

  

  

  

  RR:

  
	
   

  	
   

  	
   

  
	
     HEREBY LEASES THE REFERENCED ENT
  ACCORDING TO THE RENTAL TERMS CONDITIONS HEREIN AND ON THE REVERSE.

  	
   

  	
  

  RECOMMENDED SERVICE INTERVALS FOR THIS EQUIPMENT ARE:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  LESSEE CUSTOMERS SIGNATURE

  	
   

  	
   

  	
  ICM OUT CHECK

  	
  ICM RETURN CHECK

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  LESSOR- ICM EQUIPMENT CO.

  	
   

  	
  FILE COPY

  	
  CUST. OUT
  CHECK

  	
  CUST RETURN CHECK

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00094-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00094-of-00352.parquet"}], [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00094-of-00352.parquet"}]]