Document:

ex102928.htm

    
      	
              Exhibit
      10.2

            

    

     

    FEDERAL
DEPOSIT INSURANCE CORPORATION

     

    WASHINGTON,
D.C.

     

     

    WASHINGTON
DEPARTMENT OF FINANCIAL INSTITUTIONS

     

    OLYMPIA,
WASHINGTON

     

    
      	 
      	 
      	 
      
	
              IN
      THE MATTER OF

              RAINIER
      PACIFIC BANK

              TACOMA,
      WASHINGTON

               

              (INSURED
      STATE NONMEMBER BANK)

            	
              )

              )

              )

              )

              )

              )

              )

              )

              )

              )

            	
              STIPULATION AND
      CONSENT

              TO THE
      ISSUANCE

              OF AN ORDER

              TO CEASE AND
      DESIST

              Docket
      FDIC-521b

            
	 
      	 
      	 
      

    

     

        Subject to
the acceptance of this STIPULATION AND CONSENT TO THE ISSUANCE OF AN ORDER TO
CEASE AND DESIST ("CONSENT AGREEMENT") by the Federal Deposit Insurance
Corporation ("FDIC") and the Washington Department of Financial Institutions
(“WDFI”), it is hereby stipulated and agreed by and between a representative of
the Legal Division of FDIC, a representative of the WDFI, and Rainier
Pacific Bank, Tacoma, Washington ("Bank"), as follows:

     

        1.     The Bank has
been advised of its right to receive a NOTICE OF CHARGES AND OF HEARING
(“NOTICE”) detailing the unsafe or unsound banking practices and violations of
law alleged to have been committed by the Bank and of its right to a public
hearing on the alleged charges under section 8(b)(1) of the Federal Deposit
Insurance Act ("Act"), 12 U.S.C. § 1818(b)(1), and  Section 32.04.450 of
the Revised Code of Washington  (“RCW”), and has waived those
rights.

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

     

    
      	
              -2-

            

    

     

        2.     The Bank,
solely for the purpose of this proceeding and without admitting or denying any
of the alleged charges of unsafe or unsound banking practices and any violations
of law, hereby consents and agrees to the issuance of an ORDER TO CEASE AND
DESIST ("ORDER") by the FDIC and the WDFI. The Bank further stipulates and
agrees that such ORDER will be deemed to be an order which has become final
under the Act and the RCW, and that said ORDER shall become effective upon its
issuance by the FDIC and the WDFI, and fully enforceable by the FDIC and the
WDFI pursuant to the provisions of the Act and the RCW.

     

        3.     In the event
the FDIC and the WDFI accept the CONSENT AGREEMENT and issue the ORDER, it is
agreed that no action to enforce said ORDER in the United States District Court
will be taken by the FDIC, and no action to enforce said ORDER in State Superior
Court will be taken by the WDFI, unless the Bank or any institution-affiliated
party, as such term is defined in section 3(u) of the Act, 12 U.S.C. § 1813(u),
has violated or is about to violate any material provision of the
ORDER.

     

     

        4.     The Bank
hereby waives:

     

               
(a)   The
receipt of a NOTICE;

     

            (b)   All defenses realting to the
issuance of the Order;

     

               
(c)   A public
hearing for the purpose of taking evidence on such alleged charges;

     

               
(d)   The filing of
Proposed Findings of Fact and Conclusions of Law;

     

               
(e)   A recommended
decision of an Administrative Law Judge; and

     

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

     

    
      	
              -3-

            

    

     

            (f)   Exceptions and briefs
with respect to such recommended decision.

     

     

    Dated:
September 28, 2009.

     

    
      	
              FEDERAL
      DEPOSIT INSURANCE

              CORPORATION, LEGAL
      DIVISION

              BY:

            	
              RAINIER
      PACIFIC BANK

              TACOMA,
      WASHINGTON

              BY:

            
	 
      	 
      
	/s/Jennifer
      M.
      Geiger                                             	/s/Stephen
      M.
      Bader                                             
	
              Jennifer
      M. Geiger

            	
              Stephen
      M. Bader

            
	
              Regional
      Attorney

            	 
      
	 
      	 
      
	
              WASHINGTON
      DEPARTMENT OF

            	/s/Edward
      J.
      Brooks                                            
       
	
              FINANCIAL
      INSTITUTIONS

            	
              Edward
      J. Brooks

            
	
              BY:

            	 
      
	 
      	 
      
	/s/Brad
      Williamson                                              
       	/s/Karyn
      R.
      Clarke                                               
       
	
              Brad
      Williamson

            	
              Karyn
      R. Clarke

            
	
              Director
      of
      Banks

            	 
      
	
               

            	 
      
	 
      	/s/Charles
      E.
      Cuzzetto                                        
       
	 
      	
              Charles
      E. Cuzzetto

            
	 
      	 
      
	 
      	 
      
	 
      	/s/John 
      A.
      Hall                                                   
       
	 
      	
              John 
      A. Hall

            
	 
      	 
      
	 
      	 
      
	 
      	/s/Brian
      E.
      Knutson                                              
      
	 
      	
              Brian
      E. Knutson

            
	 
      	 
      
	 
      	 
      
	 
      	/s/Victor
      J.
      Toy                                                   
       
	 
      	
              Victor
      J. Toy

            
	 	 
	 	 
	 	/s/Alfred
      H. Treleven,
      III                                     
      
	 	Alfred
      H. Treleven, III 
	 	 
	 	 

    

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
    

     

    
      	
              -4- 

            

    

     

     

    
      	 	/s/Bruce W.
      Valentine                                         
       
	 	Bruce
      W. Valentine 
	 	 
	 	 
	 
      	___________________________________ 
      
	 
      	
              Comprising
      the Board of Directors of 

              Rainier
      Pacific Bank, Tacoma, WashingtonExhibit 10.1

         

        
          Execution
Copy

           

        

        
          

          

        

         

      

      CREDIT
AGREEMENT

       

      Dated as
of September 30, 2009

      

      among

      

      BARNES
& NOBLE, INC.,

      as the
Lead Borrower,

      

      The Other
Borrowers From Time to Time Party Hereto,

      The
Guarantors From Time to Time Party Hereto,

      

      BANK OF AMERICA,
N.A.,

      as
Administrative Agent, Collateral Agent and

      Swing
Line Lender,

      

      The Other
Lenders From Time to Time Party Hereto,

      

      JPMORGAN CHASE BANK, N.A.
and

      WELLS
FARGO RETAIL FINANCE, LLC,

      as
Co-Syndication Agents,

      

      SUNTRUST BANK and

      US
BANK, NATIONAL ASSOCIATION,

      as
Co-Documentation Agents,

      

      REGIONS BANK and

      SOVEREIGN
BANK,

      as
Co-Senior Managing Agents,

      

      BANC
OF AMERICA SECURITIES LLC,

      J.P. MORGAN SECURITIES INC.
and

      WELLS
FARGO RETAIL FINANCE, LLC,

      as Joint
Lead Arrangers

      

       and

      

      BANC
OF AMERICA SECURITIES LLC,

      J.P.
MORGAN SECURITIES INC.,

      WELLS
FARGO RETAIL FINANCE, LLC,

      SUNTRUST BANK and

      US BANK, NATIONAL
ASSOCIATION,

      as Joint
Book Runners

      

      
        

        
          

          

        

         

        
          
            
            

          

          
            
            

            
            

          

          
            
            

          

        

         

         

        
          TABLE
OF CONTENTS

           

        

      

      
        
          	 	 	
                  Page

                
	
                  ARTICLE I

                	
                  DEFINITIONS
      AND ACCOUNTING TERMS

                	
                  1

                
	
                  1.01

                	
                  Defined
      Terms

                	
                  1

                
	
                  1.02

                	
                  Other
      Interpretive Provisions

                	
                  45

                
	
                  1.03

                	
                  Accounting
      Terms

                	
                  46

                
	
                  1.04

                	
                  Rounding

                	
                  46

                
	
                  1.05

                	
                  Times
      of Day

                	
                  46

                
	
                  1.06

                	
                  Letter
      of Credit Amounts

                	
                  46

                
	
                  1.07

                	
                  Covenant
      Adjustments

                	
                  47

                
	
                  1.08

                	
                  Exclusion
      of Certain Subsidiaries

                	
                  47

                
	
                  1.09

                	
                  Notices
      Generally

                	
                  47

                
	
                  ARTICLE
      II

                	
                  THE
      COMMITMENTS AND CREDIT EXTENSIONS

                	
                  47

                
	
                  2.01

                	
                  Committed
      Loans; Reserves

                	
                  47

                
	
                  2.02

                	
                  Borrowings,
      Conversions and Continuations of Committed Loans

                	
                  48

                
	
                  2.03

                	
                  Letters
      of Credit

                	
                  50

                
	
                  2.04

                	
                  Swing
      Line Loans

                	
                  58

                
	
                  2.05

                	
                  Prepayments

                	
                  60

                
	
                  2.06

                	
                  Termination
      or Reduction of Commitments

                	
                  61

                
	
                  2.07

                	
                  Repayment
      of Loans.

                	
                  62

                
	
                  2.08

                	
                  Interest

                	
                  62

                
	
                  2.09

                	
                  Fees

                	
                  63

                
	
                  2.10

                	
                  Computation
      of Interest and Fees

                	
                  63

                
	
                  2.11

                	
                  Evidence
      of Debt

                	
                  63

                
	
                  2.12

                	
                  Payments
      Generally; Administrative Agent’s Clawback

                	
                  64

                
	
                  2.13

                	
                  Sharing
      of Payments by Lenders

                	
                  65

                
	
                  2.14

                	
                  Settlement
      Among Lenders

                	
                  66

                
	
                  2.15

                	
                  Increase
      in Commitments

                	
                  66

                
	
                  ARTICLE
      III

                	
                  TAXES,
      YIELD PROTECTION AND ILLEGALITY; APPOINTMENT OF LEAD
    BORROWER

                	
                  68

                
	
                  3.01

                	
                  Taxes

                	
                  68

                
	
                  3.02

                	
                  Illegality

                	
                  70

                
	
                  3.03

                	
                  Inability
      to Determine Rates

                	
                  70

                
	
                  3.04

                	
                  Increased
      Costs; Reserves on LIBO Rate Loans

                	
                  71

                
	
                  3.05

                	
                  Compensation
      for Losses

                	
                  72

                
	
                  3.06

                	
                  Mitigation
      Obligations; Replacement of Lenders

                	
                  72

                

        

         

         

        
          
            
            

          

          
            -i-

            
              

            

          

          
            
            

          

        

         

        TABLE OF CONTENTS

        (continued)

         

        
          	 	 	
                  Page

                
	
                  3.07

                	
                  Survival

                	
                  73

                
	
                  3.08

                	
                  Designation
      of Lead Borrower as Borrowers’ Agent

                	
                  73

                
	
                  ARTICLE
      IV

                	
                  CONDITIONS
      PRECEDENT TO CREDIT EXTENSIONS

                	
                  73

                
	
                  4.01

                	
                  Conditions
      of Initial Credit Extension

                	
                  73

                
	
                  4.02

                	
                  Conditions
      to all Credit Extensions

                	
                  77

                
	
                  ARTICLE
      V

                	
                  REPRESENTATIONS
      AND WARRANTIES

                	
                  77

                
	
                  5.01

                	
                  Existence,
      Qualification and Power

                	
                  78

                
	
                  5.02

                	
                  Authorization;
      No Contravention

                	
                  78

                
	
                  5.03

                	
                  Governmental
      Authorization; Other Consents

                	
                  78

                
	
                  5.04

                	
                  Binding
      Effect

                	
                  78

                
	
                  5.05

                	
                  Financial
      Statements; No Material Adverse Effect

                	
                  78

                
	
                  5.06

                	
                  Litigation

                	
                  79

                
	
                  5.07

                	
                  No
      Default

                	
                  79

                
	
                  5.08

                	
                  Ownership
      of Property; Liens

                	
                  79

                
	
                  5.09

                	
                  Environmental
      Compliance

                	
                  80

                
	
                  5.10

                	
                  Insurance

                	
                  81

                
	
                  5.11

                	
                  Taxes

                	
                  81

                
	
                  5.12

                	
                  ERISA
      Compliance

                	
                  81

                
	
                  5.13

                	
                  Subsidiaries;
      Equity Interests

                	
                  82

                
	
                  5.14

                	
                  Margin
      Regulations; Investment Company Act

                	
                  82

                
	
                  5.15

                	
                  Disclosure

                	
                  82

                
	
                  5.16

                	
                  Compliance
      with Laws

                	
                  83

                
	
                  5.17

                	
                  Intellectual
      Property; Licenses, Etc

                	
                  83

                
	
                  5.18

                	
                  Labor
      Matters

                	
                  83

                
	
                  5.19

                	
                  Security
      Documents

                	
                  83

                
	
                  5.20

                	
                  Solvency

                	
                  84

                
	
                  5.21

                	
                  Deposit
      and Securities Accounts; Credit Card Arrangements

                	
                  84

                
	
                  5.22

                	
                  Brokers

                	
                  84

                
	
                  5.23

                	
                  Customer
      and Trade Relations

                	
                  84

                
	
                  5.24

                	
                  Storage
      Locations

                	
                  85

                
	
                  ARTICLE
      VI

                	
                  AFFIRMATIVE
      COVENANTS

                	
                  85

                
	
                  6.01

                	
                  Financial
      Statements

                	
                  85

                

        

         

         

        
          
            
            

          

          
            -ii-

            
              

            

          

          
            
            

          

        

         

        
          TABLE OF CONTENTS

          (continued)

        

         

        
          	 	 	
                  Page

                
	
                  6.02

                	
                  Certificates;
      Other Information

                	
                  86

                
	
                  6.03

                	
                  Notices

                	
                  88

                
	
                  6.04

                	
                  Payment
      of Obligations

                	
                  89

                
	
                  6.05

                	
                  Preservation
      of Existence, Etc.

                	
                  89

                
	
                  6.06

                	
                  Maintenance
      of Properties

                	
                  90

                
	
                  6.07

                	
                  Maintenance
      of Insurance

                	
                  90

                
	
                  6.08

                	
                  Compliance
      with Laws

                	
                  91

                
	
                  6.09

                	
                  Books
      and Records; Accountants

                	
                  91

                
	
                  6.10

                	
                  Inspection
      Rights

                	
                  92

                
	
                  6.11

                	
                  Use
      of Proceeds

                	
                  93

                
	
                  6.12

                	
                  Additional
      Loan Parties; Additional Collateral; Further Assurances

                	
                  93

                
	
                  6.13

                	
                  Cash
      Management

                	
                  95

                
	
                  6.14

                	
                  Information
      Regarding the Collateral

                	
                  97

                
	
                  6.15

                	
                  Physical
      Inventories

                	
                  97

                
	
                  6.16

                	
                  Environmental
      Laws

                	
                  98

                
	
                  6.17

                	
                  Compliance
      with Terms of Leases

                	
                  98

                
	
                  6.18

                	
                  Material
      Contracts

                	
                  98

                
	
                  6.19

                	
                  Compliance
      with ERISA

                	
                  98

                
	
                  6.20

                	
                  Internal
      Control Events

                	
                  98

                
	
                  ARTICLE
      VII

                	
                  NEGATIVE
      COVENANTS

                	
                  99

                
	
                  7.01

                	
                  Liens

                	
                  99

                
	
                  7.02

                	
                  Investments

                	
                  101

                
	
                  7.03

                	
                  Indebtedness;
      Disqualified Stock

                	
                  103

                
	
                  7.04

                	
                  Fundamental
      Changes

                	
                  104

                
	
                  7.05

                	
                  Dispositions

                	
                  104

                
	
                  7.06

                	
                  Restricted
      Payments

                	
                  106

                
	
                  7.07

                	
                  Prepayments
      of Indebtedness

                	
                  106

                
	
                  7.08

                	
                  Change
      in Nature of Business

                	
                  107

                
	
                  7.09

                	
                  Transactions
      with Affiliates

                	
                  107

                
	
                  7.10

                	
                  Burdensome
      Agreements

                	
                  107

                
	
                  7.11

                	
                  Use
      of Proceeds

                	
                  108

                
	
                  7.12

                	
                  Amendment
      of Organizational Documents or Material Indebtedness

                	
                  108

                

        

         

         

        
          
            
            

          

          
            -iii-

            
              

            

          

          
            
            

          

        

         

        
          TABLE OF CONTENTS

          (continued)

        

         

        
          	 	 	
                  Page

                
	
                  7.13

                	
                  Corporate
      Name; Fiscal Year

                	
                  108

                
	
                  7.14

                	
                  Deposit
      Accounts; Credit Card Processors

                	
                  108

                
	
                  7.15

                	
                  Consolidated
      Fixed Charge Coverage Ratio

                	
                  109

                
	
                  ARTICLE
      VIII

                	
                  EVENTS
      OF DEFAULT AND REMEDIES

                	
                  109

                
	
                  8.01

                	
                  Events
      of Default

                	
                  109

                
	
                  8.02

                	
                  Remedies
      Upon Event of Default

                	
                  111

                
	
                  8.03

                	
                  Application
      of Funds

                	
                  112

                
	
                  ARTICLE
      IX

                	
                  ADMINISTRATIVE
      AGENT

                	
                  113

                
	
                  9.01

                	
                  Appointment
      and Authority

                	
                  113

                
	
                  9.02

                	
                  Rights
      as a Lender

                	
                  114

                
	
                  9.03

                	
                  Exculpatory
      Provisions

                	
                  114

                
	
                  9.04

                	
                  Reliance
      by Agents

                	
                  115

                
	
                  9.05

                	
                  Delegation
      of Duties

                	
                  115

                
	
                  9.06

                	
                  Resignation
      of Agents

                	
                  116

                
	
                  9.07

                	
                  Non-Reliance
      on Administrative Agent and Other Lenders

                	
                  116

                
	
                  9.08

                	
                  No
      Other Duties, Etc.

                	
                  117

                
	
                  9.09

                	
                  Administrative
      Agent May File Proofs of Claim

                	
                  117

                
	
                  9.10

                	
                  Collateral
      and Guaranty Matters

                	
                  117

                
	
                  9.11

                	
                  Notice
      of Transfer

                	
                  118

                
	
                  9.12

                	
                  Reports
      and Financial Statements

                	
                  118

                
	
                  9.13

                	
                  Agency
      for Perfection

                	
                  119

                
	
                  9.14

                	
                  Indemnification
      of Agents

                	
                  119

                
	
                  9.15

                	
                  Relation
      among Lenders

                	
                  119

                
	
                  9.16

                	
                  Defaulting
      Lender

                	
                  119

                
	
                  ARTICLE
      X

                	
                  MISCELLANEOUS

                	
                  120

                
	
                  10.01

                	
                  Amendments,
      Etc.

                	
                  120

                
	
                  10.02

                	
                  Notices;
      Effectiveness; Electronic Communications

                	
                  122

                
	
                  10.03

                	
                  No
      Waiver; Cumulative Remedies

                	
                  124

                
	
                  10.04

                	
                  Expenses;
      Indemnity; Damage Waiver

                	
                  124

                
	
                  10.05

                	
                  Payments
      Set Aside

                	
                  125

                
	
                  10.06

                	
                  Successors
      and Assigns

                	
                  126

                
	
                  10.07

                	
                  Treatment
      of Certain Information; Confidentiality

                	
                  129

                

        

         

         

        
          
            
            

          

          
            -iv-

            
              

            

          

          
            
            

          

        

         

        
          
            TABLE OF CONTENTS

            (continued)

          

        

         

        
          	 	 	
                  Page

                
	
                  10.08

                	
                  Right
      of Setoff

                	
                  130

                
	
                  10.09

                	
                  Interest
      Rate Limitation

                	
                  130

                
	
                  10.10

                	
                  Counterparts;
      Integration; Effectiveness

                	
                  131

                
	
                  10.11

                	
                  Survival

                	
                  131

                
	
                  10.12

                	
                  Severability

                	
                  131

                
	
                  10.13

                	
                  Replacement
      of Lenders

                	
                  131

                
	
                  10.14

                	
                  Governing
      Law; Jurisdiction; Etc.

                	
                  132

                
	
                  10.15

                	
                  Waiver
      of Jury Trial

                	
                  133

                
	
                  10.16

                	
                  No
      Advisory or Fiduciary Responsibility

                	
                  133

                
	
                  10.17

                	
                  USA
      PATRIOT Act Notice

                	
                  134

                
	
                  10.18

                	
                  Foreign
      Assets Control Regulations

                	
                  134

                
	
                  10.19

                	
                  Time
      of the Essence

                	
                  134

                
	
                  10.20

                	
                  Press
      Releases

                	
                  134

                
	
                  10.21

                	
                  Additional
      Waivers

                	
                  135

                
	
                  10.22

                	
                  No
      Strict Construction

                	
                  136

                
	
                  10.23

                	
                  Attachments

                	
                  136

                
	
                  10.24

                	
                  Copies
      and Facsimiles

                	
                  136

                
	
                  ARTICLE
      XI

                	
                  GUARANTY

                	
                  137

                
	
                  11.01

                	
                  Guaranty

                	
                  137

                
	
                  11.02

                	
                  Guaranty
      of Payment

                	
                  137

                
	
                  11.03

                	
                  No
      Discharge or Diminishment of Facility Guaranty

                	
                  137

                
	
                  11.04

                	
                  Defenses
      Waived

                	
                  138

                
	
                  11.05

                	
                  Rights
      of Subrogation

                	
                  138

                
	
                  11.06

                	
                  Reinstatement;
      Stay of Acceleration

                	
                  138

                
	
                  11.07

                	
                  Information

                	
                  138

                
	
                  11.08

                	
                  Taxes

                	
                  138

                
	
                  11.09

                	
                  Maximum
      Liability

                	
                  138

                
	
                  11.10

                	
                  Contribution

                	
                  139

                
	
                  11.11

                	
                  Liability
      Cumulative

                	
                  139

                
	
                  11.12

                	
                  Release
      of Guarantors and Borrowers

                	
                  140

                

        

        

        
          
            
            

          

          
            -v-

            
              

            

          

          
            
            

          

        

      

      

      SCHEDULES

       

      
        	 	
                1.01

              	 
      	
                Borrowers

              
	 	
                1.02

              	 
      	
                Guarantors

              
	 	
                1.03

              	 
      	
                Immaterial
      Subsidiaries

              
	 	
                1.04

              	 
      	
                Existing
      Letters of Credit

              
	 	
                2.01

              	 
      	
                Commitments
      and Applicable Percentages

              
	 	
                4.01(a)

              	 
      	
                Insurance
      Deliverables

              
	 	
                4.01(b)

              	 
      	
                Securities
      Account Control Agreement Deliverables

              
	 	
                5.01

              	 
      	
                Loan
      Parties Organizational Information

              
	 	
                5.05

              	 
      	
                Supplement
      to Interim Financial Statements/Material Indebtedness

              
	 	
                5.06

              	 
      	
                Litigation

              
	 	
                5.08(b)(1)

              	 
      	
                Owned
      Real Estate

              
	 	
                5.08(b)(2)

              	 
      	
                Leased
      Real Estate

              
	 	
                5.09

              	 
      	
                Environmental
      Matters

              
	 	
                5.10

              	 
      	
                Insurance

              
	 	
                5.12

              	 
      	
                ERISA
      Events

              
	 	
                5.13

              	 
      	
                Subsidiaries;
      Equity Interests

              
	 	
                5.18

              	 
      	
                Collective
      Bargaining Agreements

              
	 	
                5.21(a)

              	 
      	
                DDAs

              
	 	
                5.21(b)

              	 
      	
                Credit
      Card Arrangements

              
	 	
                5.21(c)

              	 
      	
                Securities
      Accounts

              
	 	
                7.01

              	 
      	
                Existing
      Liens

              
	 	
                7.02

              	 
      	
                Existing
      Investments

              
	 	
                7.03

              	 
      	
                Existing
      Indebtedness

              
	 	
                10.02

              	 
      	
                Administrative
      Agent’s Office; Certain Addresses for
Notices

              

      

       

       

      
        
          
          

        

        
          (i)

          
            

          

        

        
          
          

        

      

       

      EXHIBITS

       

      
        	 	 
      	
                Form
      of

              
	 	 	 
	 	
                A-1

              	
                Committed
      Loan Notice

              
	 	
                A-2

              	
                Conversion/Continuation
      Notice

              
	 	
                B

              	
                Swing
      Line Loan Notice

              
	 	
                C-1

              	
                Committed
      Loan Note

              
	 	
                C-2

              	
                Swing
      Line Note

              
	 	
                D

              	
                Compliance
      Certificate

              
	 	
                E

              	
                Assignment
      and Assumption

              
	 	
                F

              	
                Borrowing
      Base Certificate

              
	 	
                G

              	
                [reserved]

              
	 	
                H

              	
                Junior
      Subordinated Seller Note

              
	 	
                I

              	
                Collateral
      Access Agreement

              
	 	
                J

              	
                Joinder
      Agreement

              
	 	
                K

              	
                DDA
      Notification

              
	 	
                L

              	
                Credit
      Card Notification

              
	 	
                M

              	
                Blocked
      Account Agreement

              
	 	
                N

              	
                Senior
      Subordinated Seller Note

              
	 	
                O

              	
                General
      Notice

              

      

      

      
        
          
          

        

        
          (ii)

          
            

          

        

        
          
          

        

      

    

    
       

      
        CREDIT AGREEMENT

        

        This
CREDIT AGREEMENT (this
"Agreement") is
entered into as of September 30, 2009, among BARNES & NOBLE, INC., a
Delaware corporation (the "Lead Borrower"), the
Persons signatory hereto as borrowers and named on Schedule 1.01 hereto
(collectively, together with the Lead Borrower and such other Persons as may be
joined as a borrower from time to time in accordance herewith, the "Borrowers"), the
Persons signatory hereto as guarantors and named on Schedule 1.02 hereto
(collectively, together with such other Persons as may be joined as a guarantor
from time to time in accordance herewith, the "Guarantors"), each
lender from time to time party hereto (collectively, the "Lenders"), BANK OF AMERICA, N.A., as
Administrative Agent, Collateral Agent and Swing Line Lender, JPMORGAN CHASE BANK, N.A. and
WELLS FARGO RETAIL FINANCE,
LLC, as Co- Syndication Agents, SUNTRUST BANK and US BANK, NATIONAL
ASSOCIATION., as Co- Documentation Agents, and REGIONS BANK and SOVEREIGN BANK, as Co-Senior
Managing Agents.

        

        The
Borrowers have requested that the Lenders provide a revolving credit facility,
and the Lenders have indicated their willingness to lend and the LC Issuers have
indicated their willingness to issue Letters of Credit, in each case on the
terms and conditions set forth herein.

        

        In
consideration of the mutual covenants and agreements herein contained, the
parties hereto covenant and agree as follows:

        

        ARTICLE
I

        DEFINITIONS
AND ACCOUNTING TERMS

        

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

        

        "Accommodation
Payment" as defined in Section
10.21(d).

        

        "Account" means
"accounts" as defined in the UCC, and also means, without limitation, a right to
payment of a monetary obligation, whether or not earned by performance, (a) for
property that has been or is to be sold, leased, licensed, assigned, or
otherwise disposed of, (b) for services rendered or to be rendered, or (c)
arising out of the use of a credit or charge card or information contained on or
for use with the card.

        

        "ACH" means automated
clearing house transfers.

        

        "Acquisition" means,
with respect to any Person (a) the purchase of a Controlling interest in the
Equity Interests of any other Person, (b) a purchase or other acquisition of all
or substantially all of the assets or properties of another Person or of any
business unit or line of business of another Person (other than acquisitions or
openings of new stores in the ordinary course of business), (c) any Material
Store Acquisition or (d) any merger or consolidation of such Person with any
other Person or other transaction or series of transactions resulting in the
acquisition of all or substantially all of the assets, or a Controlling interest
in the Equity Interests, of any Person.

        

        "Additional Commitment
Lender" shall have the meaning provided in Section
2.15(c).

        

        "Adjusted LIBO Rate"
means, with respect to any LIBO Borrowing for any Interest Period, an interest
rate per annum (rounded upwards, if necessary, to the next 1/16 of one percent
(1.0%)) equal to (a) the LIBO Rate for such Interest Period multiplied by (b)
the Statutory Reserve Rate. The Adjusted

        

        
          
            
            

          

          
            1

            
              

            

          

          
            
            

          

        

         

        LIBO Rate will be adjusted automatically as to all LIBO Borrowings
then outstanding as of the effective date of any change in the Statutory Reserve
Rate.

        

        "Adjustment Date"
means the first day of each Fiscal Quarter of the Lead Borrower commencing with
the third full Fiscal Quarter after the Closing Date.

        

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

        

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

        

        "Administrative
Questionnaire" means an Administrative Questionnaire for each Lender in a
form supplied by the Administrative Agent.

        

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

        

        

        "Agent(s)" means,
individually, the Administrative Agent or the Collateral Agent, and collectively
means both of them.

        

        "Agent Parties" shall
have the meaning specified in Section
10.02(c).

        

        "Aggregate
Commitments" means the Commitments of all the Lenders. The Aggregate
Commitments as of the Closing Date total $1,000,000,000.

        

        "Agreement" means this
Credit Agreement.

        

        "Allocable Amount" has
the meaning specified in Section
10.21(d).

        

        "Applicable Commitment Fee
Percentage" means (a) for the period from the Closing Date through
October 31, 2009, 1.00% and (b) thereafter, the applicable percentage set forth
in the grid below:

        

        
          	 
      	
                  Applicable
      Commitment

                
	
                  Average
      Usage

                	
                  Fee
      Percentage

                
	
                  Less
      than 33.3% of the Aggregate Commitments

                	
                  1.00%

                
	
                  Equal
      to or greater than 33.3% but less than 66.6%

                	
                  0.75%

                
	
                  of
      the Aggregate Commitments

                	 
      
	
                  Equal
      to or greater than 66.6% of the Aggregate

                	
                  0.50%

                
	
                  Commitments

                	 
      

        

        

        "Applicable Margin"
means (a) from and after the Closing Date until the first Adjustment Date, the
Applicable Margin shall be set at the percentages set forth in Level II of the
pricing grid below; and (b) from and after the first Adjustment Date (and each
subsequent Adjustment Date) until the next Adjustment Date, the Applicable
Margin shall be determined from the following pricing grid based upon the
Average Daily Availability for the Fiscal Quarter ending the day immediately
preceding such starting Adjustment Date; provided, however, that
notwithstanding anything to the contrary set forth herein, upon the occurrence
of an Event of Default or the Termination Date, the Administrative Agent may,
and at the direction of the Required Lenders shall, immediately increase the
Applicable Margin to that set forth in

        

        
          
            
            

          

          
            2

            
              

            

          

          
            
            

          

           

        

        Level I (even if the Average Daily Availability requirements for a
different Level have been met); provided further if
the information set forth in any Borrowing Base Certificate or any other
certificate provided by the
Loan Parties that is applicable to the calculation of the Applicable Margin
otherwise proves to be false or incorrect such that the Applicable Margin would
have been higher than was otherwise in effect during any period, without
constituting a waiver of any Default arising as a result thereof, interest due
under this Agreement shall be immediately recalculated at such higher rate for
any applicable periods and shall be due and payable on demand.

        

        
          	 
      	 
      	
                  LIBO
      Rate

                	
                  Base
      Rate

                
	
                  Level

                	
                  Average
      Daily Availability

                	
                  Margin

                	
                  Margin

                
	
                  I

                	
                  Less
      than 33.3% of the Loan Cap

                	
                  4.00%

                	
                  3.00%

                
	
                  II

                	
                  Equal
      to or greater than 33.3% but

                	
                  3.75%

                	
                  2.75%

                
	 
      	
                  less
      than 66.6% of the Loan Cap

                	 
      	 
      
	
                  III

                	
                  Equal
      to or greater than 66.6% of the

                	
                  3.50%

                	
                  2.50%

                
	 
      	
                  Loan
      Cap

                	 
      	 
      

        

        

        "Applicable
Percentage" means with respect to any Lender at any time, the percentage
(carried out to the ninth decimal place) of the Aggregate Commitments
represented by such Lender’s Commitment at such time. If the commitment of each
Lender to make Loans and the obligation of the LC Issuers to make LC Credit
Extensions have been terminated pursuant to Section 8.02 or if
the Aggregate Commitments have expired, then the Applicable Percentage of each
Lender shall be determined based on the Applicable Percentage of such Lender
most recently in effect, giving effect to any subsequent assignments. The
initial Applicable Percentage of each Lender is set forth opposite the name of
such Lender on Schedule 2.01 or in
the Assignment and Assumption pursuant to which such Lender becomes a party
hereto, as applicable.

        

        "Applicable Rate"
means, at any time of calculation, a per annum rate equal to the Applicable
Margin for Loans which are LIBO Rate Loans.

        

        "Appraisal Percentage"
means eighty-five percent (85.0%).

        

        "Appraised Value"
means with respect to Eligible Real Estate, the fair market value of the
Eligible Real Estate as set forth in the most recent appraisal of the Eligible
Real Estate as determined from time to time by an independent appraiser engaged
by the Administrative Agent (in the case of any appraisal after the Closing
Date, pursuant to Section 6.10(b)
hereof), which appraisal shall assume, among other things, a marketing time of
not greater than twelve (12) months (unless a longer period is otherwise agreed
to by the Administrative Agent and the Arrangers) or less than three (3)
months.

        

        "Approved Fund" means
any Fund that is administered or managed by (a) a Lender, (b) an Affiliate of a
Lender or (c) an entity or an Affiliate of an entity that administers or manages
a Lender.

        

        "Arranger(s)" means,
individually, Banc of America Securities LLC, J.P. Morgan Securities Inc. and
Wells Fargo Retail Finance, LLC, and collectively, all of them, in each case, in
their capacity as Joint Lead Arrangers.

        

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

        

        "Assignment and
Assumption" means an assignment and assumption entered into by a Lender
and an Eligible Assignee (with the consent of any party whose consent is
required by Section
10.06(b)),

        
 

        
          
            
            

          

          
            3

            
              

            

          

          
            
            

          

        

        

        and accepted by the Administrative Agent, in substantially the form
of Exhibit E or
any other form approved by the Administrative Agent.

        

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

        

        "Audited Financial
Statements" means the audited consolidated balance sheet of the Lead
Borrower and its Subsidiaries for the fiscal year ended January 31, 2009, and
the related consolidated statements of income or operations, Shareholders’
Equity and cash flows for such fiscal year of the Lead Borrower and its
Subsidiaries, including the notes thereto.

        

        "Auto-Extension Letter of
Credit" shall have the meaning specified in Section
2.03(b)(iii).

        

        "Availability" means,
as of any date of determination thereof by the Administrative Agent, the greater
of (a) the Loan Cap minus Total
Outstandings and (b) zero.

        

        "Availability Event"
has the meaning provided in the definition of Trigger Event.

        

        "Availability Period"
means the period from and including the Closing Date to the earliest of (a) the
Maturity Date, (b) the date of termination of the Aggregate Commitments in full
pursuant to Section 2.06, and (c) the
date of termination of the Commitment of each Lender to make Loans and of
the obligation of
the LC Issuers to make LC Credit Extensions pursuant to Section
8.02.

        

        "Availability
Reserves" means, without duplication of any other Reserves or items that
are otherwise addressed or excluded through eligibility criteria, such reserves
as the Administrative Agent from time to time determines in its Permitted
Discretion as being appropriate (a) to reflect the impediments to the Agents’
ability to realize upon the Collateral, (b) to reflect claims and liabilities
that the Administrative Agent determines will need to be satisfied in connection
with the realization upon the Collateral, (c) to reflect criteria, events,
conditions, contingencies or risks which adversely affect any component of the
Borrowing Base, or (d) to reflect that a Default then exists. Without limiting
the generality of the foregoing, Availability Reserves may include, in the
Administrative Agent’s discretion, (but are not limited to) reserves based on:
(i) rent; (ii) customs duties, and other costs to release Inventory that is (A)
included in the Borrowing Base and (B) being imported into the United States;
(iii) outstanding Taxes and other governmental charges, including, without
limitation, ad valorem, real estate, personal property, sales, and other Taxes
which may have priority over the interests of the Collateral Agent in the
Collateral; (iv) salaries, wages and benefits due to employees of any Borrower,
(v) Customer Credit Liabilities, (vi) warehousemen’s or bailee’s charges and
other Permitted Encumbrances which may have priority over the interests of the
Collateral Agent in the Collateral, (vii) Cash Management Reserves, and (viii)
Bank Products Reserves.

        

        "Average Daily
Availability" means, as of any date of determination, the average daily
Availability for the immediately preceding Fiscal Quarter.

        

        "Average Usage" means,
as of any date of determination, the average daily balance of all Credit
Extensions (excluding Swing Line Loans) in the immediately preceding Fiscal
Quarter.

        

        "Bank of America"
means Bank of America, N.A. and its successors.

         

        
          
            
            

          

          
            4

            
              

            

          

          
            
            

          

        

        

        "Bank
Products" means any Swap Contracts provided to any Loan Party by a Lender
or any of its Affiliates.

        

        "Bank Product
Reserves" means such reserves as the Administrative Agent from time to
time determines in its discretion as being appropriate to reflect the
liabilities and obligations of the Loan Parties with respect to Bank Products
then provided or outstanding.

        

        "Base Rate" means for
any day a fluctuating rate per annum equal to the highest of (a) the Federal
Funds Rate plus 1/2 of 1.0% (b) the rate of interest in effect for such day as
publicly announced from time to time by Bank of America as its "prime rate" and
(c) the Adjusted LIBO Rate for an Interest Period of one month, plus 1.0%. The "prime
rate" is a rate set by Bank of America based upon various factors including Bank
of America’s costs and desired return, general economic conditions and other
factors, and is used as a reference point for pricing some loans, which may be
priced at, above, or below such announced rate. Any change in such rate
announced by Bank of America shall take effect at the opening of business on the
day specified in the public announcement of such change.

        

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

        

        "Blocked Account" has
the meaning provided in Section
6.13(a)(iii).

        

        "Blocked Account
Agreement" means with respect to an account established by a Loan Party,
an agreement, substantially in the form of Exhibit M hereto or
otherwise in form and substance reasonably satisfactory to the Collateral Agent,
establishing Control (as defined in the Security Agreement) of such account by
the Collateral Agent and whereby the bank maintaining such account agrees,
during any Trigger Period, to comply only with the instructions originated by
the Collateral Agent without the further consent of any Loan Party.

        

        "Blocked Account Bank"
means each bank with whom deposit accounts are maintained in which any funds of
any of the Loan Parties from one or more DDAs are concentrated and with whom a
Blocked Account Agreement has been, or is required to be, executed in accordance
with the terms hereof.

        

        "BNCB" means Barnes
& Noble College Booksellers, Inc., a New York corporation.

        

        "BNCB Acquisition"
means the Acquisition of all the outstanding Equity Interests of BNCB by Lead
Borrower from the Sellers pursuant to the terms of the BNCB Acquisition
Documents.

        

        "BNCB Acquisition
Documents" means the BNCB Purchase Agreement, the Seller Notes and all
related documents pertaining to the BNCB Acquisition.

        

        "BNCB Blocked Account"
means any Blocked Account of any BNCB Loan Party which, for the avoidance of
doubt, shall not include any BNCB Trigger Period Accounts.

        

        "BNCB Loan Parties"
means BNCB and each Subsidiary thereof that is a Loan Party.

        

        "BNCB Purchase
Agreement" means that certain Stock Purchase Agreement dated August 7,
2009 by and among the Sellers and Lead Borrower.

        

        "BNCB Standstill
Period" means the period during which (a) a Trigger Period has occurred
and is continuing, (b) the Borrowers have maintained Availability equal to or
greater than fifteen percent (15.0%) of the Loan Cap at all times and (c) any
BNCB Loan Party is engaged in Permitted Buy-Back Programs.

         

        
          
            
            

          

          
            5

            
              

            

          

          
            
            

          

           

        

        "BNCB
Trigger Period" means, with respect to the BNCB Loan Parties, any portion
of a Trigger Period that is not a BNCB Standstill Period. For the avoidance of
doubt, the existence of a BNCB Trigger Period (other than as a result of an
Event of Default) shall not, in and of itself, impair the right of the Borrowers
to borrow Committed Loans in accordance with the terms and conditions
hereof.

        

        "BNCB Trigger Period
Accounts" has the meaning specified in Section
6.13(e).

        

        "Borrower" and "Borrowers" have the
meaning specified in the introductory paragraph hereto.

        

        "Borrower Materials"
has the meaning specified in Section
6.02.

        

        "Borrowing" means a Committed Borrowing or a
Swing Line Borrowing, as the context may require.

        

        "Borrowing Base"
means, at any time of calculation, an amount equal to:

        

        (a) the
face amount of Eligible Credit Card Receivables multiplied by ninety
percent (90.0%);

        

        plus

        

        (b) the
face amount of Eligible Accounts Receivables (net of Receivables Reserves
applicable thereto) multiplied by eighty-five percent (85.0%);

        

        plus

        

        (c) the
lesser of (i) Net Orderly Liquidation Value of the Borrower’s Eligible
Inventory, net of Inventory Reserves not already reflected in Net Orderly
Liquidation Value, multiplied by the Appraisal Percentage, or (ii) the Cost of
the Borrower’s Eligible Inventory, net of Inventory Reserves, multiplied by
seventy-five percent (75.0%);

        

        plus

        

        (d) the
lesser of (i) the Appraised Value of Eligible Real Estate, if any, net of Realty
Reserves, in each case not already reflected in the Appraised Value of Eligible
Real Estate, applicable thereto multiplied by fifty
percent (50.0%) or (ii) $25,000,000;

        

        minus

        

        (e)
without duplication of any Reserves applied in clauses (a) – (d) above, all
other then existing Availability Reserves.

        

        "Borrowing Base
Certificate" means a certificate substantially in the form of Exhibit F hereto
(with such changes therein as may be required by the Administrative Agent to
reflect the components of and reserves against the Borrowing Base as provided
for hereunder from time to time), executed and certified as accurate and
complete by a Responsible Officer of the Lead Borrower which shall include
appropriate exhibits, schedules, supporting documentation, and additional
reports as reasonably requested by the Administrative Agent.

        

        "Business" means (a)
the operation of retail bookstores (including, without limitation, on-campus and
off-campus university or college bookstores) and cafés and gift shops relating
thereto, (b) the sale and distribution (whether in bookstores or on-line) of
books and other printed material, magazines,

         

        
          
            
            

          

          
            6

            
              

            

          

          
            
            

          

        

        

        newspapers, journals, course packs, music, movies, food and
beverages, gifts, housewares, electronics devices, software, school supplies,
greeting cards, posters, toys, games, kits, and children’s products and other
products and services commonly found in physical or on-line bookstores, (c)
without limitation of the foregoing clause (b), in the case of university or
college bookstores, the sale (whether in bookstores or on-line) of apparel,
athletic or insignia merchandise, school-related memorabilia, computer hardware
and software, and other products and services commonly found in on-campus or
off-campus university or college bookstores, (d) the rental or buyback (whether
in bookstores or on-line) of textbooks, trade books, course packs and similar
materials, (e) the sale of e-books and any other form of digital content
(including, without limitation, audio and video content) and of devices relating
to digital content (including, without limitation, accessories therefor), (f)
the wholesaling of new or used books (including e-books), (g) the publishing or
production of books and other printed material, journals, gifts, toys, games,
kits, children’s products and other products commonly found in physical or
online bookstores, (h) publishing and print services for books, magazines,
periodicals and other media, and (i) in the case of each of the foregoing
clauses (a) through (h), (x) any on-line operations relating thereto and (y) any
marketing or advertising activities relating thereto.

        

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

        

        "Capital Expenditures"
means, with respect to any Person for any period, (a) all expenditures made
(whether made in the form of cash or other property) or costs incurred for the
acquisition or improvement of fixed or capital assets of such Person (excluding
normal replacements and maintenance which are properly charged to current
operations), in each case that are (or should be) set forth as capital
expenditures in a Consolidated statement of cash flows of such Person for such
period, in each case prepared in accordance with GAAP, and (b) Capital Lease
Obligations incurred by a Person during such period, provided, however, that Capital
Expenditures for the Lead Borrower and its Subsidiaries shall not
include:

         

        (i)           expenditures
to the extent they are made with proceeds of the issuance of Equity Interests of
the Lead Borrower or any of its Subsidiaries,

        

        (ii)           expenditures
with proceeds of insurance settlements, condemnation awards and other
settlements in respect of lost, destroyed, damaged or condemned assets,
equipment or other property to the extent such proceeds are not otherwise used
or required to be used to prepay the Obligations or Cash Collateralize the
outstanding LC Obligations pursuant to the terms hereunder,

        

        (iii)           expenditures
that are accounted for as capital expenditures of the Lead Borrower or any
Subsidiary that are actually paid for by other third party, including tenant
allowances under leases and other amounts paid by landlords, and for which
neither the Lead Borrower nor any Subsidiary has provided or is required to
provide or incur, directly or indirectly, any consideration or obligation to
such third party or any other Person (whether before, during or after such
period),

        

        (iv)           the
book value of any asset owned by the Lead Borrower or any of its Subsidiaries
prior to or during such period to the extent that such book value is included as
a capital expenditure during such period as a result of the Lead Borrower or
such Subsidiary reusing or beginning to reuse such asset during such period
without a corresponding expenditure actually having been made in such period,
and

        

        
          
            
            

          

          
            7

            
              

            

          

          
            
            

          

        

        

        (v) the purchase price of equipment purchased during such period to
the extent the consideration therefor consists of any combination of (i) used or
surplus equipment traded in at the time of such purchase and (ii) the proceeds
of a concurrent sale of used or surplus equipment, in each case, in the ordinary
course of business, to the extent such proceeds are not otherwise used or
required to be used to prepay the Obligations or Cash Collateralize the
outstanding LC Obligations pursuant to the terms hereunder.

        

        "Capital Lease
Obligations" means, with respect to any Person for any period, the
obligations of such Person to pay rent or other amounts under any lease of (or
other arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
accounted for as liabilities on a Consolidated balance sheet of such Person
under GAAP and the amount of which obligations shall be the capitalized amount
thereof determined in accordance with GAAP.

        

        "Cash Collateral
Account" means a non-interest bearing account established by one or more
of the Loan Parties with Bank of America, and in the name of, the Collateral
Agent (or as the Collateral Agent shall otherwise direct) and under the sole and
exclusive dominion and control of the Collateral Agent, in which deposits are
required to be made in accordance with Section 2.03(g) or
Section
8.02(c).

        

        "Cash Collateralize"
means the delivery of cash or deposit account balances to the Collateral Agent
as security for the payment of the Secured Obligations and pursuant to
documentation in form and substance reasonably satisfactory to the Collateral
Agent, in an amount equal to (a) with respect to LC Obligations, 105% of the
aggregate amount thereof, and (b) with respect to any Secured Obligations under
any Bank Product or Cash Management Services, such amount as may be agreed
between the Loan Party and Lender or Affiliate of a Lender party to such Swap
Contract constituting a Bank Product or to such Cash Management Services, as
applicable. "Cash
Collateralization" and "Cash Collateral" have
a correlative meaning.

        

        "Cash Equivalents"
means Investments of the type referred to in Section 7.02(b) and
other similar short term and/or liquid Investments.

        

        "Cash Management
Reserves" means such reserves as the Administrative Agent, from time to
time, determines in its discretion as being appropriate to reflect the
reasonably anticipated liabilities and obligations of the Loan Parties with
respect to Cash Management Services then provided or outstanding.

        

        "Cash Management
Services" means any one or more of the following types or services or
facilities provided to any Loan Party by a Lender or any of its Affiliates: (a)
ACH transactions, (b) cash management services, including, without limitation,
controlled disbursement services, treasury, depository, overdraft, and
electronic funds transfer services, (c) foreign exchange facilities, and (d)
credit cards, debit cards, payroll cards, store value cards and purchasing cards
and related processing services.

        

        "CERCLA" means the
Comprehensive Environmental Response, Compensation, and Liability Act, 42 U.S.C.
§ 9601 et seq.

        

        "CERCLIS" means the
Comprehensive Environmental Response, Compensation, and Liability Information
System maintained by the United States Environmental Protection
Agency.

        

        "CFC" means a Person
that is a controlled foreign corporation under Section 957 of the
Code.

        

        "Change in Law" means
the occurrence, after the date of this Agreement, of any of the following: (a)
the adoption or taking effect of any law, rule, regulation or treaty, (b) any
change in any law, rule,

        

        
          
            
            

          

          
            8

            
              

            

          

          
            
            

          

           

        

        regulation or treaty or in the administration, interpretation or
application thereof by any Governmental Authority or (c) the making or issuance
of any request, guideline or directive (whether or not having the force of law)
by any Governmental Authority.

        

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

        

        (a)           any
"person" or "group" (as such terms are used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, but excluding any employee benefit plan of such
person or its subsidiaries, and any person or entity acting in its capacity as
trustee, agent or other fiduciary or administrator of any such plan) (other than
Leonard Riggio, his spouse, his lineal descendants, and trusts for the exclusive
benefit of any such individuals or the executor or administrator of the estate
or the legal representative of any of such individuals or any entity controlled
by them) becomes the "beneficial owner" (as defined in Rules 13d-3 and 13d-5
under the Securities Exchange Act of 1934, except that a person or group shall
be deemed to have "beneficial ownership" of all securities that such person or
group has the right to acquire, whether such right is exercisable immediately or
only after the passage of time (such right, an "option right")),
directly or indirectly, of 40.0% or more of the Equity Interests of the Lead
Borrower entitled to vote for members of the board of directors or equivalent
governing body of the Lead Borrower on a fully-diluted basis (including taking
into account all such Equity Interests that such "person" or "group" has the
right to acquire pursuant to any option right); or

        

        (b)           during
any period of twenty-four (24) consecutive months, a majority of the members of
the board of directors or other equivalent governing body of the Lead Borrower
cease to be composed of individuals (i) who were members of that board or
equivalent governing body on the first day of such period, (ii) whose election
or nomination to that board or equivalent governing body was approved by
individuals referred to in clause (i) above constituting at the time of such
election or nomination at least a majority of that board or equivalent governing
body or (iii) whose election or nomination to that board or other equivalent
governing body was approved by individuals referred to in clauses (i) and (ii)
above constituting at the time of such election or nomination at least a
majority of that board or equivalent governing body (excluding, in the case of
both clause (ii) and clause (iii), any individual whose initial nomination for,
or assumption of office as, a member of that board or equivalent governing body
occurs as a result of an actual or threatened solicitation of proxies or
consents for the election or removal of one or more directors by any person or
group other than a solicitation for the election of one or more directors by or
on behalf of the board of directors);

        

        (c)           any
"change in control" or similar event as defined in any document governing the
Permitted Senior Debt or the Seller Notes; or

        

        (d)           the
Lead Borrower ceases to own, directly or indirectly, 100% of the Equity
Interests of any Loan Party, except where such failure is as a result of a
transaction expressly permitted by the Loan Documents.

        

        "Closing Date" means
the first date all the conditions precedent in Section 4.01 are
satisfied or waived in accordance with Section
10.01.

        

        "Code" means the
Internal Revenue Code of 1986, and the regulations promulgated thereunder, as
amended and in effect.

        

        "Co-Documentation
Agent" means each of the co-documentation agents identified on the cover
page of this Agreement.

        

        
          
            
            

          

          
            9

            
              

            

          

          
            
            

          

           

        

        "Collateral" means any
and all "Collateral" as defined in any applicable Security Document and all
other property that is or is intended under the terms of the Security Documents
to be subject to Liens in favor of the Collateral Agent.

        

        "Collateral Access
Agreement" means an agreement substantially in the form of Exhibit I hereto or
such other form as agreed to by the Collateral Agent in its Permitted Discretion
and in each case otherwise reasonably satisfactory in form and substance to the
Agents executed by (a) a bailee or other Person in possession of Collateral, and
(b) a landlord of Real Estate leased by any Loan Party, in each case, including
provisions pursuant to which such Person (i) acknowledges the Collateral Agent’s
Lien on the Collateral, (ii) releases or subordinates such Person’s Liens, if
any, in the Collateral held by such Person or located on such Real Estate, and
(iii) as to any landlord, provides the Collateral Agent with access to the
Collateral located in or on such Real Estate and a reasonable time to sell and
dispose of the Collateral from such Real Estate.

        

        "Collateral Agent"
means Bank of America, acting in such capacity for its own benefit and the
ratable benefit of the other Secured Parties.

        

        "Commercial Letter of
Credit" means any letter of credit or similar instrument (including,
without limitation, bankers’ acceptances) issued for the purpose of providing
the primary payment mechanism in connection with the purchase of any materials,
goods or services by the Lead Borrower or any of its Subsidiaries in the
ordinary course of business of such Person.

        

        "Commitment" means, as
to each Lender, its obligation to (a) make Committed Loans to the Borrowers
pursuant to Section
2.01, (b) purchase participations in LC Obligations, and (c) purchase
participations in Swing Line Loans, in an aggregate principal amount at any one
time outstanding not to exceed the amount set forth opposite such Lender’s name
on Schedule
2.01 or in any Assignment and Assumption pursuant to which such Lender
becomes a party hereto, as applicable, as such amount may be adjusted from time
to time in accordance with this Agreement.

        

        "Committed Borrowing"
means a borrowing consisting of simultaneous Committed Loans of the same Type
and, in the case of LIBO Rate Loans, having the same Interest Period made by
each of the Lenders pursuant to Section
2.01.

        

        "Committed Loan" has
the meaning specified in Section
2.01.

        

        "Committed Loan
Notice" means a notice of (a) a Committed Borrowing, (b) a conversion of
Committed Loans from one Type to the other, or (c) a continuation of LIBO Rate
Loans, pursuant to Section 2.01(a),
which, if in writing, shall be substantially in the form of Exhibit
A-1.

        

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

        

        "Concentration
Account" has the meaning provided in Section6.13(c).

        

        "Consent" means actual
consent given by a Lender from whom such consent is sought.

        

        "Consolidated" means,
when used to modify a financial term, test, statement, or report of a Person,
the application or preparation of such term, test, statement or report (as
applicable) based upon the consolidation, in accordance with GAAP, of the
financial condition or operating results of such Person and its
Subsidiaries.

        

        
          
            
            

          

          
            10

            
              

            

          

          
            
            

          

        

        

        "Consolidated Adjusted Fixed
Charge Coverage Ratio" means, at any date of determination for the
purpose of determining whether a particular Restricted Payment or prepayment of
Indebtedness (each a "Subject Transaction")
may be consummated pursuant to the terms of this Agreement, the ratio of (a)
Consolidated EBITDA for such period minus (i) Capital
Expenditures (other than in connection with Permitted Acquisitions) made during
such period minus (ii) the
aggregate amount of Federal, state, local and foreign income taxes paid in cash
or required to be paid in cash during such period to (b) the sum of (i) Debt
Service Charges (other than prepayments of principal in the Subject Transaction
and, if the Subject Transaction is a prepayment of Seller Notes, all other prior
prepayments of Seller Notes) plus (ii) the
aggregate amount of all Restricted Payments made in cash (other than those made
in the Subject Transaction and, if the Subject Transaction is a repurchase of
equity interests, all repurchases related to such Subject Transaction that have
previously been made as part of a single stock repurchase plan approved by the
board of directors of the Lead Borrower, if any), in each case, of or by the
Lead Borrower and its Subsidiaries for the most recently completed Measurement
Period, all as determined on a Consolidated basis in accordance with GAAP. For
the avoidance of doubt, Permitted Tax Distributions shall not be taken into
account in any calculation of the Consolidated Adjusted Fixed Charge Coverage
Ratio for any purpose hereunder except to the extent that such Permitted Tax
Distribution shall exceed $50,000,000 and then only shall such incremental
amount be taken into account in any calculation of Consolidated Adjusted Fixed
Charge Coverage Ratio.

        

        

        "Consolidated EBITDA"
means, at any date of determination, an amount equal to Consolidated Net Income
of the Lead Borrower and its Subsidiaries on a Consolidated basis for the most
recently completed Measurement Period, plus (a) the
following to the extent deducted in calculating such Consolidated Net Income:
(i) Consolidated Interest Charges, (ii) the provision for Federal, state, local
and foreign income Taxes (net of any tax credits), (iii) depreciation and
amortization expense, (iv) other expenses or losses reducing such Consolidated
Net Income which do not represent a cash item in such period (including LIFO
reserves) or any future period and (v) expenses deducted in such period
resulting from the issuance of Equity Interests permitted hereunder, provided
that such expenses are and will be non-cash items in the period when taken and
in all later fiscal periods (in each case of or by the Lead Borrower and its
Subsidiaries for such Measurement Period), minus (b) all
non-cash gains increasing Consolidated Net Income (in each case of or by the
Lead Borrower and its Subsidiaries for such Measurement Period), all as
determined on a Consolidated basis in accordance with GAAP.

        

        "Consolidated Fixed Charge
Coverage Ratio" means, at any date of determination, the ratio of (a)
Consolidated EBITDA for such period minus (i) Capital
Expenditures (other than in connection with Permitted Acquisitions) made during
such period minus (ii) the
aggregate amount of Federal, state, local and foreign income taxes paid in cash
or required to be paid in cash during such period to (b) the sum of (i) Debt
Service Charges plus (ii) the aggregate amount of all Restricted Payments made
in cash, in each case, of or by the Lead Borrower and its Subsidiaries for the
most recently completed Measurement Period, all as determined on a Consolidated
basis in accordance with GAAP. For the avoidance of doubt, Permitted Tax
Distributions shall not be taken into account in any calculation of the
Consolidated Fixed Charge Coverage Ratio for any purpose hereunder except to the
extent that such Permitted Tax Distribution shall exceed $50,000,000 and then
only shall such incremental amount be taken into account in any calculation of
Consolidated Fixed Charge Coverage Ratio.

        

        "Consolidated Interest
Charges" means, for any Measurement Period, the sum of (a) all interest,
premium payments, debt discount, fees, charges and related expenses in
connection with borrowed money (including capitalized interest) or in connection
with the deferred purchase price of assets, in each case to the extent treated
as interest in accordance with GAAP, including, without limitation, all
commissions, discounts and other fees and charges owed with respect to letters
of credit and bankers’ acceptance financing and net costs under Swap Contracts,
but excluding any non-cash or deferred interest financing costs, and (b) the
portion of rent expense with respect to such period under Capital Lease
Obligations or

        
          
            
            

          

          
            11

            
              

            

          

          
            
            

          

           

        

        Synthetic Lease Obligations that is treated as interest in
accordance with GAAP, in each case of or by the Lead Borrower and its
Subsidiaries for the most recently completed Measurement Period, all as
determined on a Consolidated basis in accordance with GAAP.

        

        "Consolidated Net
Income" means, as of any date of determination, the net income of the
Lead Borrower and its Subsidiaries for the most recently completed Measurement
Period, all as determined on a Consolidated basis in accordance with GAAP, provided, however,
that there shall be excluded (a) extraordinary gains (or extraordinary losses)
for such Measurement Period, (b) the income (or loss) of any Subsidiary during
such Measurement Period in which any other Person has a joint interest, except
to the extent of the amount of cash dividends or other distributions actually
paid in cash to such Subsidiary during such period, (c) the income (or loss) of
any Person during such Measurement Period and accrued prior to the date it
becomes a Subsidiary or is merged into or consolidated with the Lead Borrower or
any of its Subsidiaries or such Person’s assets are acquired by the Lead
Borrower or any of its Subsidiaries, and (d) the income of any Subsidiary to the
extent that the declaration or payment of dividends or similar distributions by
that Subsidiary of that income is not at the time permitted by operation of the
terms of its Organization Documents or any agreement, instrument, judgment,
decree, order, statute, rule or governmental regulation applicable to that
Subsidiary, except that the Lead Borrower’s equity in any net loss of any such
Subsidiary for such Measurement Period shall be included in determining
Consolidated Net Income.

        

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

        

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

        

        "Conversion/Continuation
Notice" means a notice of (a) a conversion of Loans from one Type to the
other, or (b) a continuation of LIBO Rate Loans, pursuant to Section 2.02(c),
which, if in writing, shall be substantially in the form of Exhibit
A-2.

        

        "Cost" means the lower
of cost or market value of Inventory, based upon the Borrowers’ accounting
practices, known to the Administrative Agent, which practices are in effect on
the Closing Date as such calculated cost is determined from invoices received by
the Borrowers and reported on the Borrowers’ stock ledger. "Cost" may include
freight charges inbound either to the Borrowers' distribution centers or by
direct shipments to Stores in amounts consistent with reporting on the
Borrowers' stock ledgers but shall not include inventory capitalization costs or
other non-purchase price charges (such as freight charges outbound from the
Borrowers' distributions centers) used in the Borrowers’ calculation of cost of
goods sold.

        

        "Co-Senior Managing
Agent" means each of the co-senior managing agents identified on the
cover page of this Agreement.

        

        "Co-Syndication Agent"
means each of the co-syndication agents identified on the cover page of this
Agreement.

        

        "Credit Card
Notifications" has the meaning provided in Section
6.13(a)(ii).

        

        "Credit Card
Receivables" means each "Account" (as defined in the UCC) together with
all income, payments and proceeds thereof, owed by a major credit card issuer
(including, but not limited to, Visa, MasterCard, American Express, Discover and
Pay Pal and such other issuers approved by the

        

        
          
            
            

          

          
            12

            
              

            

          

          
            
            

          

        

        

        Administrative Agent) to a Loan Party resulting from charges by a
customer of a Loan Party on credit cards issued by such issuer in connection
with the sale of goods by a Loan Party, or services performed by a Loan Party,
in each case in the ordinary course of its business.

        

        "Credit Extensions"
mean each of the following: (a) a Borrowing and (b) an LC Credit
Extension.

        

        "Credit Party" or
"Credit
Parties" means (a) individually, (i) each Lender, (ii) each Lender and/or
its Affiliate in its capacity as a provider of any Bank Products or Cash
Management Services, (iii) each Agent, (iv) each LC Issuer, (v) any other Person
to whom Secured Obligations under this Agreement and other Loan Documents are
owing, and (vi) the successors and assigns of each of the foregoing, and (b)
collectively, all of the foregoing.

        

        "Credit Party
Expenses" means, without limitation, (a) all reasonable out-of-pocket
expenses incurred by the Agents and their respective Affiliates, in connection
with this Agreement and the other Loan Documents, including without limitation
(i) the reasonable fees, charges and disbursements of (A) counsel for the
Agents, (B) outside consultants for the Agents, (C) appraisers, (D) commercial
finance examiners, and (E) without duplication of any amounts reimbursed
pursuant to the foregoing subclauses (i) (A) – (D), all such out-of-pocket
expenses incurred during any workout, restructuring or negotiations in respect
of the Secured Obligations, (ii) in connection with (A) the syndication of the
credit facilities provided for herein, (B) the administration and management of
this Agreement and the other Loan Documents or the preparation, negotiation,
execution and delivery the Loan Documents or of any amendments, modifications or
waivers of the provisions thereof (whether or not the transactions contemplated
thereby shall be consummated), (C) the enforcement or protection of their rights
in connection with this Agreement or the Loan Documents or efforts to preserve,
protect, collect, or enforce the Collateral or in connection with any proceeding
under any Debtor Relief Laws, or (D) without duplication of any amounts
reimbursed pursuant to the foregoing subclause (ii)(C), any workout,
restructuring or negotiations in respect of any Secured Obligations, and (b)
with respect to any LC Issuer, and its Affiliates, all reasonable out-of-pocket
expenses incurred in connection with the issuance, amendment, renewal or
extension of any Letter of Credit or any demand for payment thereunder; and (c)
all reasonable out-of-pocket expenses incurred by the Credit Parties who are not
the Agents, an LC Issuer or any Affiliate of any of them, after the occurrence
and during the continuance of an Event of Default, including, without
limitation, enforcement or protection of their rights or efforts to preserve,
protect, collect, or enforce the Collateral or in connection with any proceeding
under any Debtor Relief Laws, provided that such
Credit Parties shall be entitled to reimbursement for no more than one
counsel representing
all such Credit Parties (absent a conflict of interest in which case the Credit
Parties may engage and be reimbursed for additional counsel).

        

        "Customary BNCB
Dispositions" has the meaning specified in Section
7.05(c).

        

        "Customer Credit
Liabilities" means at any time, the aggregate remaining value at such
time of (a) outstanding merchandise credits, gift certificates and gift cards of
the Borrowers entitling the holder thereof to use all or a portion of the
credit, certificate or gift card to pay all or a portion of the purchase price
for any Inventory, and (b) outstanding customer deposits of the
Borrowers.

        

        "DDA" means each
checking, savings or other demand deposit account maintained by any of the Loan
Parties. All funds in each DDA shall be presumed to be Collateral and proceeds
of Collateral and the Agents and the Lenders shall have no duty to inquire as to
the source of the amounts on deposit in any DDA.

        

        "DDA Notification" has
the meaning provided therefor in Section
6.13(a)(i).

        
          
            
            

          

          
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        "Debt
Service Charges" means for any Measurement Period, the sum of (a)
Consolidated Interest Charges paid in cash or required to be paid in cash for
such Measurement Period, plus (b) principal
payments, other than Permitted Senior Seller Note Payments or Permitted
Refinancing, made or required to be made on account of Indebtedness (excluding
the Obligations but including, without limitation, Capital Lease Obligations)
for such Measurement Period, in each case determined on a Consolidated basis in
accordance with GAAP.

        

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

        

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

        

        "Default Rate" means
(a) when used with respect to Obligations other than Letter of Credit Fees, an
interest rate equal to (i) the Base Rate plus (ii) the Applicable Margin, if
any, applicable to Base Rate Loans, plus (iii) two percent ( 2.0%) per annum;
provided, however, that with respect to a LIBO Rate Loan, the Default Rate shall
be an interest rate equal to the interest rate (including any Applicable Margin)
otherwise applicable to such Loan plus two percent ( 2.0%) per annum, and (b)
when used with respect to Letter of Credit Fees, a rate equal to the Applicable
Rate for Letters of Credit, plus two percent ( 2.0%) per annum.

        

        "Defaulting Lender"
means any Lender that (a) has failed to fund any portion of the Committed Loans,
participations in LC Obligations or participations in Swing Line Loans required
to be funded by it hereunder within one (1) Business Day of the date required to
be funded by it hereunder, (b) has otherwise failed to pay over to the
Administrative Agent or any other Lender any other amount required to be paid by
it hereunder within three (3) Business Days of the date when due, unless the
subject of a good faith dispute, or (c) has been deemed insolvent or become the
subject of a bankruptcy, insolvency or similar proceeding; provided that receipt
of financial or other support from a Governmental Entity shall not, in and of
itself, constitute or be deemed to constitute insolvency under this clause
(c).

        

        "Deteriorating Lender"
means any Defaulting Lender or any Lender as to which (a) the LC Issuer has a
good faith belief that such Lender has defaulted in fulfilling its obligations
under more than one other syndicated credit facility, or (b) a Person that
Controls such Lender has been deemed insolvent or become the subject of a
bankruptcy, insolvency or similar proceeding; provided, that
receipt of financial or other support from a Governmental Entity shall not, in
and of itself, constitute or be deemed to constitute insolvency under this
clause (b).

        

        "Disposition" or
"Dispose" means
the sale, transfer, license, lease or other disposition (including any sale and
leaseback transaction and any sale, transfer, license or other disposition of
(whether in one transaction or in a series of transactions) of any property
(including, without limitation, any issuance and sale of any Equity Interests in
another Person) by any Person (or the granting of any option or other right to
do any of the foregoing), including any sale, assignment, transfer or other
disposal, with or without recourse, of any notes or accounts receivable or any
rights and claims associated therewith. For the avoidance of doubt, the
termination of any Lease by a counterparty pursuant to any right of termination
(other than upon a default by any Loan Party) under such Lease does not
constitute a Disposition by any Loan Party.

        

        "Disqualified Stock"
means any Equity Interest that, by its terms (or by the terms of any security
into which it is convertible, or for which it is exchangeable, in each case at
the option of the holder

        

        
          
            
            

          

          
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        thereof), or upon the happening of any event, matures or is
mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or
redeemable at the option of the holder thereof, in whole or in part, on or prior
to the date that is ninety-one (91) days after the Maturity Date; provided, however, that (i)
only the portion of such Equity Interests which so matures or is mandatorily
redeemable, is so convertible or exchangeable or is so redeemable at the option
of the holder thereof prior to such date shall be deemed to be Disqualified
Stock and (ii) with respect to any Equity Interests issued to any employee or to
any plan for the benefit of employees of the Lead Borrower or its Subsidiaries
or by any such plan to such employees, such Equity Interest shall not constitute
Disqualified Stock solely because it may be required to be repurchased by the
Lead Borrower or one of its Subsidiaries in order to satisfy applicable
statutory or regulatory obligations or as a result of such employee’s
termination, resignation, death or disability and (iii) if any class of Equity
Interest of such Person that by its terms authorizes such Person to satisfy its
obligations thereunder by delivery of an Equity Interest that is not
Disqualified Stock, such Equity Interests shall not be deemed to be Disqualified
Stock. Notwithstanding the preceding sentence, any Equity Interest that would
constitute Disqualified Stock solely because the holders thereof have the right
to require a Loan Party to repurchase such Equity Interest upon the occurrence
of a change of control or an asset sale shall not constitute Disqualified Stock.
The amount of Disqualified Stock deemed to be outstanding at any time for
purposes of this Agreement will be the maximum amount that the Lead Borrower and
its Subsidiaries may become obligated to pay upon maturity of, or pursuant to
any mandatory redemption provisions of, such Disqualified Stock or portion
thereof, plus accrued dividends.

        

        "Dollars" and "$" mean lawful money
of the United States.

        

        "Domestic Subsidiary"
means any Subsidiary that is organized under the laws of any political
subdivision of the United States.

        

        "Eligible Assignee"
means (a) a Credit Party or any of its Affiliates; (b) a bank, insurance
company, or company engaged in the business of making commercial loans, which
Person, together with its Affiliates, has a combined capital and surplus in
excess of $500,000,000.00; (c) an Approved Fund; (d) any Person to whom a Credit
Party assigns its rights and obligations under this Agreement as part of an
assignment and transfer of such Credit Party’s rights in and to a material
portion of such Credit Party’s portfolio of asset based credit facilities, and
(e) any other Person (other than a natural person) approved by (i) the
Administrative Agent, the LC Issuer and the Swing Line Lender, and (ii) unless
an Event of Default has occurred and is continuing, the Lead Borrower (each such
approval not to be unreasonably withheld or delayed); provided that
notwithstanding the foregoing, "Eligible Assignee" shall not include a Loan
Party or any of the Loan Parties’ Affiliates or Subsidiaries.

        

        "Eligible Accounts
Receivables" means Accounts arising from the sale of a Borrower’s
Inventory (other than those consisting of Credit Card Receivables) or the
rendition of services that satisfies the following criteria at the time of
creation and continues to meet the same at the time of such determination: such
Account (i) has been earned by full performance and represents the bona fide
amounts due to a Borrower from an account debtor, and in each case originated in
the ordinary course of business of such Borrower, and (ii) is not ineligible for
inclusion in the calculation of the Borrowing Base pursuant to any of clauses
(a) through (s) below. Without limiting the foregoing, to qualify as an Eligible
Accounts Receivable, an Account shall indicate no Person other than a Borrower
as payee or remittance party. In determining the amount to be so included, the
face amount of an Account shall be reduced by, without duplication, to the
extent not reflected in such face amount, (i) the amount of all accrued and
actual discounts, claims, credits or credits pending, promotional program
allowances, price adjustments, finance charges or other allowances (including
any amount that a Borrower may be obligated to rebate to a customer pursuant to
the terms of any agreement or understanding (written or oral)) and (ii) the
aggregate amount of all cash received in respect of such Account but not yet
applied by the Borrowers to reduce the amount of such Eligible Account
Receivable. Any Accounts meeting the foregoing criteria shall be

         

        
          
            
            

          

          
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        deemed Eligible Accounts Receivables but only as long as such
Account is not included within any of the following categories, in which case
such Account shall not constitute an Eligible Account
Receivable:

        

        
          (a)         
 Accounts
that are not evidenced by an invoice;

        

        

        (b)           Accounts
that have been outstanding for more than ninety (90) days from the invoice date
or more than sixty (60) days past the due date;

        

        (c)           Accounts
due from any account debtor for which more than 50.0% of the Accounts owing from
such account debtor and its Affiliates are ineligible under clause (b)
above.

        

        (d)           Accounts
with respect to which a Borrower does not have good, valid and marketable title
thereto, free and clear of any Lien (other than Liens granted to the Collateral
Agent pursuant to the Security Documents) or which are not subject to a first
priority security interest in favor of the Collateral Agent;

        

        (e)           Accounts
which are disputed or with respect to which a claim, counterclaim, offset or
chargeback has been asserted, but only to the extent of such dispute,
counterclaim, offset or chargeback;

        

        (f)           Accounts
which arise out of any sale made not in the ordinary course of business, made on
a basis other than upon credit terms usual to the business of the Borrowers or
are not payable in Dollars;

        

        (g)          Accounts
which do not conform in all material respects to all representations, warranties
or other provisions in the Loan Documents relating to Accounts;

        

        
           
 (h)           
Accounts
which are owed by any Affiliate or any employee of a Loan
Party;

        

        

        (i)           Accounts
due from an account debtor which is the subject of any bankruptcy or insolvency
proceeding, has had a trustee or receiver appointed for all or a substantial
part of its property, has made an assignment for the benefit of creditors or has
suspended its business;

        

        (j)           Accounts
due from any Governmental Authority other than (i) Accounts for which all
consents, approvals or authorizations of, or registrations or declarations with,
any Governmental Authority required to be obtained, effected or given in
connection with the performance of such Account by the account debtor or in
connection with the enforcement of such Account by the Agent, in each case, have
been duly obtained, effected or given or are in full force and effect and (ii)
Eligible State University Accounts;

        

        (k)           Accounts
(i) owing from any Person that is also a supplier to or creditor of a Loan Party
or any of its Subsidiaries unless such Person has waived any right of setoff in
a manner acceptable to the Administrative Agent, (ii) representing any
manufacturer’s or supplier’s credits, discounts, incentive plans or similar
arrangements entitling a Loan Party or any of its Subsidiaries to discounts on
future purchase therefrom or (iii) representing a progress billing or
retainage;

        

        (l)           Accounts
arising out of sales on a bill-and-hold, guaranteed sale, sale-or-return, sale
on approval or consignment basis or subject to any right of return, setoff or
charge back;

        

        
          
            
            

          

          
            16

            
              

            

          

          
            
            

          

        

        

        (m)          Accounts
arising out of sales to account debtors outside the United States unless such
Accounts are fully backed by an irrevocable letter of credit on terms, and
issued by a financial institution, acceptable to the Administrative Agent in its
Permitted Discretion;

        

        
          (n)         
[reserved];

        

        

        
          (o)        
 Accounts
evidenced by a promissory note or other instrument;

        

        

        
          (p)         
Accounts
consisting of amounts due from vendors as rebates or
allowances;

        

        

        (q)           Accounts
which are in excess of the credit limit for such account debtor established by
the Loan Parties in the ordinary course of business and consistent with past
practices;

        

        (r)           Accounts
which include extended payment terms (datings) beyond those generally furnished
to other account debtors in the ordinary course of business without the consent
of the Administrative Agent; or

        

        (s)           Accounts
which the Administrative Agent determines in its Permitted Discretion to be
unacceptable for inclusion in the Borrowing Base.

        

        "Eligible Credit Card
Receivables" means at the time of any determination thereof, each Credit
Card Receivable that satisfies the following criteria at the time of creation
and continues to meet the same at the time of such determination: such Credit
Card Receivable (i) has been earned by performance and represents the bona fide
amounts due to a Borrower from a credit card payment processor and/or credit
card issuer, and in each case originated in the ordinary course of business of
such Borrower, and (ii) is not ineligible for inclusion in the calculation of
the Borrowing Base pursuant to any of clauses (a) through (k) below. Without
limiting the foregoing, to qualify as an Eligible Credit Card Receivable, an
Account shall indicate no Person other than a Borrower as payee or remittance
party. In determining the amount to be so included, the face amount of an
Account shall be reduced by, without duplication, to the extent not reflected in
such face amount, (i) the amount of all accrued and actual discounts, claims,
credits or credits pending, promotional program allowances, price adjustments,
finance charges or other allowances (including any amount that a Borrower may be
obligated to rebate to a customer, a credit card payment processor, or credit
card issuer pursuant to the terms of any agreement or understanding (written or
oral)) and (ii) the aggregate amount of all cash received in respect of such
Account but not yet applied by the Loan Parties to reduce the amount of such
Credit Card Receivable. Any Credit Card Receivables meeting the foregoing
criteria shall be deemed Eligible Credit Card Receivables but only as long as
such Credit Card Receivable is not included within any of the following
categories, in which case such Credit Card Receivable shall not constitute an
Eligible Credit Card Receivable:

        

        (a)           Credit Card Receivables which do not
constitute an "Account" (as defined in the UCC);

        

        (b)           Credit
Card Receivables that have been outstanding for more than five (5) Business Days
from the date of sale;

        

        (c)           Credit
Card Receivables with respect to which a Loan Party does not have good, valid
and marketable title, free and clear of any Lien (other than Liens granted to
the Collateral Agent);

         

        
          
            
            

          

          
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        (d)           Credit
Card Receivables that are not subject to a first priority security interest in
favor of the Collateral Agent (it being the intent that chargebacks in the
ordinary course by such processors shall not be deemed violative of this
clause);

        

        (e)           Credit
Card Receivables which are disputed, are with recourse, or with respect to which
a claim, counterclaim, offset or chargeback has been asserted (to the extent of
such claim, counterclaim, offset or chargeback) by any Person;

        

        (f)           Credit
Card Receivables as to which the processor has the right under certain
circumstances to require a Loan Party to repurchase the Accounts from such
credit card processor;

        

        (g)           Credit
Card Receivables due from an issuer or payment processor of the applicable
credit card which is the subject of any bankruptcy, insolvency or similar
proceedings;

        

        (h)           Credit
Card Receivables which are not a valid, legally enforceable obligation of the
applicable issuer with respect thereto;

        

        (i)           Credit
Card Receivables which do not conform in all material respects to all
representations, warranties or other provisions in the Loan Documents relating
to Credit Card Receivables;

        

        (j)           Credit
Card Receivables which are evidenced by "chattel paper" or an "instrument" of
any kind unless such "chattel paper" or "instrument" is in the possession of the
Collateral Agent, and to the extent necessary or appropriate, endorsed to the
Collateral Agent; or

        

        (k)           Credit
Card Receivables which the Administrative Agent determines in its Permitted
Discretion to be uncertain of collection.

        

        "Eligible Inventory"
means, as of the date of determination thereof, without duplication, items of
Inventory of a Borrower that are finished goods, merchantable and readily
saleable to the public in the ordinary course that, in each case, complies with
each of the representations and warranties expressly respecting Inventory made
by the Borrowers in the Loan Documents, and that is not excluded as ineligible
by virtue of one or more of the criteria set forth below. The following items of
Inventory shall not be included in Eligible Inventory:

        

        (a)           Inventory
that is not solely owned by a Borrower or a Borrower does not have good and
valid title thereto;

        

        (b)           Inventory
that is leased by or is on consignment to a Borrower or which is consigned by a
Borrower to a Person that is not a Loan Party;

        

        (c)           Inventory
that is not located in the United States of America (excluding territories or
possessions of the United States);

        

        (d)           Inventory
at a location that is owned or leased by a Borrower, except to the extent that
the Borrowers have furnished the Administrative Agent with (i) any UCC financing
statements or other documents that the Administrative Agent may determine to be
necessary to perfect its security interest in such Inventory at such location,
and (ii) with respect to any Material Storage Location, a Collateral Access
Agreement executed by the Person owning any such Material Storage Location on
terms reasonably acceptable to the Administrative Agent;

        

        
          
            
            

          

          
            18

            
              

            

          

          
            
            

          

        

         

        (e)           Inventory
that is comprised of goods which (i) are damaged, defective, "seconds," or
otherwise unmerchantable, (ii) that have been or are in the process of being
returned to the vendor, (iii) are obsolete or slow moving, or custom items,
work-in-process, raw materials, or that constitute spare parts, promotional,
marketing, packaging and shipping materials or supplies used or consumed in a
Borrower’s business, (iv) are seasonal in nature and which have been packed away
for sale in the subsequent season, (v) are not in compliance with all standards
imposed by any Governmental Authority having regulatory authority over such
Inventory, its use or sale, (vi) are bill and hold goods or (vii) are
in-transit;

        

        (f)           Inventory
that is not subject to a perfected first-priority security interest in favor of
the Collateral Agent, subject only to any interest, title or lien of a landlord,
lessor or other property owner under a Lease or applicable Laws (provided that, for
the avoidance of doubt, no provisions with respect to the subordination of Liens
or other landlord rights in any Collateral Access Agreement shall be deemed to
violate this clause (f));

        

        (g)          Inventory
that consists of samples, labels, bags, packaging, and other similar
non-merchandise categories;

        

        
          (h)          Inventory
that is not insured in compliance with the provisions of Section 5.10
hereof;

        

        

        (i)           Inventory
that has been sold but not yet delivered or as to which a Borrower has accepted
a deposit;

        

        (j)           Inventory
that is subject to any licensing, patent, royalty, trademark, trade name or
copyright agreement with any third party which has expired or has been
terminated or with respect to which any Borrower or any of its Subsidiaries has
received notice of a dispute in respect of any such agreement;

        

        (k)           Inventory
acquired in a Permitted Acquisition, unless and until the Collateral Agent has
completed or received (A) an appraisal of such Inventory from appraisers
satisfactory to the Collateral Agent, establishes an advance rate and Inventory
Reserves (if applicable) therefor, and otherwise agrees that such Inventory
shall be deemed Eligible Inventory, and (B) such other due diligence as the
Agents may require, all of the results of the foregoing to be reasonably
satisfactory to the Agents; or

        

        (l)           Inventory
which the Administrative Agent determines in its Permitted Discretion to be
unacceptable for inclusion in the Borrowing Base.

        

        "Eligible Real Estate"
means Real Estate which satisfies all of the following conditions:

        

        
          (a)         
such Real
Estate is located in the continental United States;

        

        

        
          (b)         
a
Borrower owns such Real Estate in fee simple absolute;

        

        

        (c)           the
Administrative Agent shall have received evidence that all actions have been
taken for which the Administrative Agent shall have notified the Lead Borrower
that the Administrative Agent has reasonably deemed necessary in order to create
a valid first priority Lien (subject in priority only to (i) Permitted
Encumbrances set forth in Sections 7.01(a),
(c), (d) and (h), provided, that, with
respect to Liens for Taxes being contested in compliance with Section 6.04 and
Permitted Encumbrances set forth in Section 7.01(d), such
Liens are insured

        

        
          
            
            

          

          
            19

            
              

            

          

          
            
            

          

        

         

        over by the applicable Title Policy and (ii) such other Lien (other
than any Lien securing Indebtedness for borrowed money or other funded debt) as
may be approved by the Collateral Agent in its Permitted Discretion) in such
Real Estate;

        

        (d)           the
Real Estate or any portion thereof (the loss of which shall have, in the
Permitted Discretion of the Collateral Agent, a material impact on the use,
operation or value of the “Property” (as defined in the applicable Mortgage))
shall not have been damaged or taken through condemnation (which term shall
include any damage or taking by any Governmental Authority, quasi-governmental
authority, any Person having the power of condemnation, or any transfer by
private sale in lieu thereof), either temporarily or permanently;

        

        (e)           the
Administrative Agent shall have received an appraisal of such Real Estate
complying with the requirements of FIRREA by a third party appraiser engaged by
the Administrative Agent and otherwise in form and substance reasonably
satisfactory to the Administrative Agent; and

        

        (f)           all
Real Estate Eligibility Requirements with respect to such Real Estate shall have
been satisfied in the Administrative Agent’s Permitted Discretion.

        

        "Eligible State University
Accounts" means Accounts that otherwise satisfy the eligibility
requirements of “Eligible Accounts Receivable” and that are owing from colleges
or universities that are agencies or political subdivisions of state or local
Governmental Authorities and that arise in the ordinary course of Business of
the Borrowers from management agreements, textbook or course pack sales, trade
or general merchandise sales, guarantees of payments due from students or
otherwise.

        

        "Environmental
Assessment" has the meaning specified in the definition of Real Estate
Eligibility Requirements.

        

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

        

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

        

        "Equity Interests"
means, with respect to any Person, all of the shares of capital stock of (or
membership or other ownership or profit interests in) such Person, all of the
warrants, options or other rights for the purchase or acquisition from such
Person of shares of capital stock of (or membership or other ownership or profit
interests in) such Person, all of the securities convertible into or
exchangeable for shares of capital stock of (or other ownership or profit
interests in) such Person or warrants, rights or options for the purchase or
acquisition from such Person of such shares (or such membership or other
interests), and all of the other ownership or profit interests in such Person
(including partnership, member

        
 

        
          
            
            

          

          
            20

            
              

            

          

          
            
            

          

        

        

        or trust interests therein), whether voting or nonvoting, and
whether or not such shares, warrants, options, rights or other interests are
outstanding on any date of determination.

        

        "ERISA" means the
Employee Retirement Income Security Act of 1974.

        

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

        

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

        

        "Event of Default" has
the meaning specified in Section 8.01. An
Event of Default shall be deemed to be continuing unless and until that Event of
Default has been duly waived as provided in Section 10.01
hereof.

        

        "Excluded Assets" has
the meaning given to such term in the Security Agreement.

        

        "Excluded Taxes"
means, with respect to the Administrative Agent, any Lender, the LC Issuer or
any other recipient of any payment to be made by or on account of any obligation
of the Borrowers hereunder, (a) taxes imposed on or measured by its overall net
income (however denominated), and franchise taxes imposed on it (in lieu of net
income taxes), by the jurisdiction (or any political subdivision thereof) under
the laws of which such recipient is organized or in which its principal office
is located or, in the case of any Lender, in which its applicable Lending Office
is located, (b) any branch profits taxes imposed by the United States or any
similar tax imposed by any other jurisdiction in which any Loan Party is located
and (c) in the case of a Foreign Lender (other than an assignee pursuant to a
request by the Lead Borrower under Section 10.13), any
withholding tax that is imposed on amounts payable to such Foreign Lender at the
time such Foreign Lender becomes a party hereto (or designates a new Lending
Office) or is attributable to such Foreign Lender’s failure or inability (other
than as a result of a Change in Law) to comply with Section 3.01(e),
except to the extent that such Foreign Lender (or its assignor, if any) was
entitled, at the time of designation of a new Lending Office (or assignment), to
receive additional amounts from the Borrowers with respect to such withholding
tax pursuant to Section
3.01(a).

        

        "Executive Order" has
the meaning set forth in Section
10.18.

        

        “Existing BNCB Credit
Agreement” means that certain Credit Agreement, dated as of November 13,
2006, among BNCB, certain subsidiaries of BNCB from time to time party thereto,
Bank of America, N.A., as agent, and a syndicate of lenders.

        

        
          
            
            

          

          
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        "Existing
Credit Agreement" means that certain Credit Agreement dated as of June
17, 2005 among the Lead Borrower, certain other borrowers party thereto, Bank of
America, N.A., as agent, and a syndicate of lenders.

        

        "Existing Letters of
Credit" means the letters of credit described on Schedule 1.04
hereto.

        

        "Facility Guaranty"
means any Guarantee made by the Guarantors in favor of the Credit Parties,
including as set forth in Article XI hereto or
in any guaranty agreement in form reasonably satisfactory to the Administrative
Agent.

        

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

        

        "Fee Letter" means the
amended and restated fee letter agreement, dated August 7, 2009, among the Lead
Borrower, the Administrative Agent, the other institutions party thereto and the
Joint Lead Arrangers.

        

        "FIRREA Documents" has
the meaning specified in the definition of Real Estate Eligibility
Requirements.

        

        "Fiscal Month" means
any fiscal month of any Fiscal Year determined in accordance with the fiscal
accounting calendar of the Loan Parties.

        

        "Fiscal Quarter" means
any fiscal quarter of any Fiscal Year determined in accordance with the fiscal
accounting calendar of the Loan Parties.

        

        "Fiscal Year" means
any period of twelve (12) consecutive months ending on the Saturday that is
closest to the last day of January of any calendar year, provided that after
the change contemplated by Section 7.13, “Fiscal Year” shall
mean any period of twelve (12) consecutive months ending on the Saturday that
is closest to the end of April of any calendar year that is in accordance with
the National Retail Federation calendar.

        

        "Fixed Charge Trigger
Event" means the failure of the Borrowers to maintain at any time
Availability at least equal to the greater of (i) fifteen percent (15.0%) of the
Loan Cap or (ii) $110,000,000.

        

        "Fixed Charge Trigger
Period" means the period beginning upon the occurrence of a Fixed Charge
Trigger Event and ending on the date Availability has equaled or exceeded the
greater of (i) fifteen percent (15.0%) of the Loan Cap or (ii) $110,000,000 for
a period of forty-five (45) consecutive calendar days.

        

        "Flood Zone
Certification" has the meaning specified in the definition of Real Estate
Eligibility Requirements.

        

        
          
            
            

          

          
            22

            
              

            

          

          
            
            

          

        

         

        "Foreign
Assets Control Regulations" has the meaning set forth in Section
10.18.

        

        "Foreign Lender" means
any Lender and each LC Issuer, if such Person is organized under the laws of a
jurisdiction other than that in which the Lead Borrower is resident for tax
purposes. For purposes of this definition, the United States, each State thereof
and the District of Columbia shall be deemed to constitute a single
jurisdiction.

        

        "Foreign Subsidiary"
means any Subsidiary organized under the laws of a political subdivision outside
of the United States.

        

        "Fronting Fee" has the
meaning assigned to such term in Section
2.03(j).

        

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

        

        "Fully Satisfied"
means (a) with respect to any Secured Obligations or Obligations, as applicable,
the full cash payment thereof, including all principal, interest and fees with
respect thereto and any interest, fees and other charges accruing during a
proceeding under any Debtor Relief Law (whether or not such amounts are allowed
or allowable in whole or in part in such proceeding), but shall not include any
roll up of any Secured Obligations or Obligations in any debtor in possession
financing during any such proceeding; and (b) with respect to LC Obligations,
Other Liabilities or Obligations that are inchoate or contingent in nature, the
Cash Collateralization thereof (or delivery of a standby letter of credit
acceptable to the applicable Credit Party in its discretion, in the amount of
required Cash Collateral). No Loans shall be deemed to have been Fully Satisfied
until all Commitments related to such Loans have expired or been
terminated.

        

        "Fund" means any
Person (other than a natural person) that is (or will be) engaged in making,
purchasing, holding or otherwise investing in commercial loans and similar
extensions of credit in the ordinary course of its business.

        

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

        

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

        

        "Guarantee" means, as
to any Person, any (a) any obligation, contingent or otherwise, of such Person
guaranteeing or having the economic effect of guaranteeing any Indebtedness or
other obligation payable or performable by another Person (the "primary
obligor") in any manner, whether directly or indirectly, and including any
obligation of such Person, direct or indirect, (i) to purchase or pay (or
advance or supply funds for the purchase or payment of) such Indebtedness or
other obligation, (ii) to purchase or lease property, securities or services for
the purpose of assuring the obligee in respect of such Indebtedness or other
obligation of the payment or performance of such Indebtedness or other
obligation, (iii) to maintain working capital, equity capital or any other
financial statement condition or liquidity or level of income or cash flow of
the primary obligor so as to enable the primary obligor to pay such

         

        
          
            
            

          

          
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        Indebtedness or other obligation, or (iv) entered into for the
purpose of assuring in any other manner the obligee in respect of such
Indebtedness or other obligation of the payment or performance thereof or to
protect such obligee against loss in respect thereof (in whole or in part), or
(b) any Lien on any assets of such Person securing any Indebtedness or other
obligation of any other Person, whether or not such Indebtedness or other
obligation is assumed by such Person (or any right, contingent or otherwise, of
any holder of such Indebtedness to obtain any such Lien), but excluding in all
cases endorsements for collection or deposit in the ordinary course of business.
The amount of any Guarantee shall be deemed to be an amount equal to the stated
or determinable amount of the related primary obligation, or portion thereof, in
respect of which such Guarantee is made or, if not stated or determinable, the
maximum reasonably anticipated liability in respect thereof as determined by the
guaranteeing Person in good faith. The term "Guarantee" as a verb has a
corresponding meaning.

        

        "Guaranteed
Obligations" has the meaning specified in Section
11.01.

        

        "Guarantor" means each
wholly-owned Subsidiary of the Lead Borrower (other than any Borrower, any CFC
or any Immaterial Subsidiary) and each other Subsidiary of the Lead Borrower
that is not a Borrower and that is required to execute and deliver a Facility
Guaranty pursuant to Section
6.12.

        

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

        

        "Honor Date" has the
meaning specified in Section
2.03(c)(i).

        

        "Immaterial
Subsidiary" means each Subsidiary of the Lead Borrower that has been
designated by the Lead Borrower in writing to the Administrative Agent as an
"Immaterial Subsidiary" for purposes of this Agreement and the other Loan
Documents, provided that (a) for purposes of this Agreement, at no time shall
(i) the total assets of all Immaterial Subsidiaries, as of the end of the most
recent Fiscal Quarter for which financial statements have been delivered
pursuant to Section
6.01(a) or Section 6.01(b)
hereof, equal or exceed five percent (5.0%) of the Consolidated total assets of
the Lead Borrower and its Subsidiaries, or (ii) any Immaterial Subsidiary own
any assets included in the Borrowing Base, or (iii) the gross revenues of all
Immaterial Subsidiaries for any Measurement Period equal or exceed five percent
(5.0%) of the Consolidated gross revenues of the Lead Borrower and its
Subsidiaries for such Measurement Period, in each case as determined in
accordance with GAAP, and (b) no Subsidiary that has been designated an
"Immaterial Subsidiary" may be re-designated a "Subsidiary" or be treated under
the Loan Documents as a Loan Party without the written approval of the
Administrative Agent which approval may be withheld for any reason. As of the
Closing Date, the Subsidiaries specified on Schedule 1.03 hereto are the
only Subsidiaries designated by the Lead Borrower as Immaterial Subsidiaries
for purposes of
this Agreement and the other Loan Documents.

        

        "Increase Effective
Date" shall have the meaning provided therefor in Section
2.15(d).

        

        "Increased Commitment
Lender" shall have the meaning provide in Section
2.15(b).

        

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

        

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

        

        
          
            
            

          

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

        

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

        

        

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

        

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

        

        
          (f)          
all
Attributable Indebtedness of such Person;

        

        

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

        

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

        

        

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

        

        "Indemnified Taxes"
means Taxes other than Excluded Taxes.

        

        "Indemnitees" has the
meaning specified in Section
10.04(b).

        

        "Information" has the
meaning specified in Section
10.07.

        

        "Intellectual
Property" means all present and future: trade secrets, know-how and other
proprietary information; trademarks, trademark applications, internet domain
names, service marks, trade dress, trade names, business names, designs, logos,
slogans (and all translations, adaptations, derivations and combinations of the
foregoing) indicia and other source and/or business identifiers, and all
registrations or applications for registrations which have heretofore been or
may hereafter be issued thereon throughout the world; copyrights and copyright
applications; (including copyrights for computer programs) and all tangible and
intangible property embodying the copyrights, unpatented inventions (whether or
not patentable); patents and patent applications; industrial design applications
and registered industrial designs; license agreements related to any of the
foregoing and income therefrom; books, records, writings, computer tapes or
disks, flow diagrams, specification sheets, computer software, source codes,
object codes, executable code, data, databases and other physical
manifestations, embodiments or incorporations of any of the foregoing; all other
intellectual property; and all common law and other rights throughout the world
in and to all of the foregoing.

         

        
          
            
            

          

          
            25

            
              

            

          

          
            
            

          

        

        

        "Interest
Payment Date" means, (a) as to any Loan other than a Base Rate Loan, the
last day of each Interest Period applicable to such Loan and the Maturity Date;
provided, however, that if any Interest Period for a LIBO Rate Loan exceeds
three months, the respective dates that fall every three months after the
beginning of such Interest Period shall also be Interest Payment Dates; and (b)
as to any Base Rate Loan (including a Swing Line Loan), the first Business Day
of each month and the Maturity Date.

        

        "Interest Period"
means, as to each LIBO Rate Loan, the period commencing on the date such LIBO
Rate Loan is disbursed or converted to or continued as a LIBO Rate Loan and
ending on the date one (1), two (2), three (3) or six (6) months thereafter, as
selected by the Lead Borrower in its Committed Loan Notice; provided
that:

        

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

        

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

        

        
          (iii)         
no
Interest Period shall extend beyond the Maturity Date; and

        

        

        (iv)          notwithstanding
the provisions of clause (iii) no Interest Period shall have a duration of less
than one (1) month, and if any Interest Period applicable to a LIBO Borrowing
would be for a shorter period, such Interest Period shall not be available
hereunder.

        

        For
purposes hereof, the date of a Borrowing initially shall be the date on which
such Borrowing is made and thereafter shall be the effective date of the most
recent conversion or continuation of such Borrowing.

        

        “Internal Control
Event” means (a) with respect to the Lead Borrower, a determination by
management or the Audit Committee of the Board of Directors of the Lead Borrower
or by the Lead Borrower’s Public Accountants that (i) a material weakness in
internal controls over financial reporting, as described in PCAOB Auditing
Standard No. 5, exists in the Lead Borrower’s internal control over financial
reporting, or (ii) a member of the senior management of the Lead Borrower has
committed a material act of fraud, and (b) with respect to the any Subsidiary of
the Lead Borrower, a determination by management or the Audit Committee of the
Board of Directors of the Lead Borrower or by the Lead Borrower’s Public
Accountants that (i) a material weakness in internal controls over financial
reporting, as described in PCAOB Auditing Standard No. 5, exists in the such
Subsidiary’s internal control over financial reporting, or (ii) a member of the
senior management of such Subsidiary has committed an act of fraud, in either
case under this clause (b) that could reasonably be expected to result in an
Material Adverse Effect; provided, that, for
the avoidance of doubt in the case of clause (b)(i) with respect to BNCB, a
determination by management or the audit committee of the Lead Borrower’s Board
of Directors or by the Lead Borrower’s Public Accountants of the existence of a
material weakness due to a deficiency in the design or operation of BNCB’s
internal controls over financial reporting, as described in PCAOB Auditing
Standard No. 5, shall not be considered to result in a Material Adverse Effect
so long as (i) such determination is made solely with respect to the internal
controls of BNCB as a wholly-owned subsidiary of the Lead Borrower immediately
after giving effect to the BNCB Acquisition, (ii) the failure to rectify such
weakness shall not have resulted in a violation of applicable securities or
other Laws and

         

        
          
            
            

          

          
            26

            
              

            

          

          
            
            

          

        

        

        (iii) such weakness does not result in any material misstatement of
the Lead Borrower’s consolidated interim or audited financial
statements.

        

        "Inventory" has the
meaning given that term in the UCC, and shall also include, without limitation,
all: (a) goods which (i) are leased by a Person as lessor, (ii) are held by a
Person for sale or lease or to be furnished under a contract of service, (iii)
are furnished by a Person under a contract of service, or (iv) consist of raw
materials, work in process, or materials used or consumed in a business; (b)
goods of said description in transit; (c) goods of said description which are
returned, repossessed or rejected; and (d) packaging, advertising, and shipping
materials related to any of the foregoing.

        

        "Inventory Reserves"
means such reserves as may be established from time to time by the
Administrative Agent in the Administrative Agent’s Permitted Discretion with
respect to the determination of the saleability, at retail, of the Eligible
Inventory or which reflect such other factors as affect the market value of the
Eligible Inventory. Without limiting the generality of the foregoing, Inventory
Reserves may, in the Administrative Agent’s Permitted Discretion, include (but
are not limited to) reserves based on:

        

        
          	
                   
      

                	
                  (a)

                	
                  obsolescence;

                

        

        

        
          	
                   
      

                	
                  (b)

                	
                  seasonality;

                

        

        

        
          	
                   
      

                	
                  (c)

                	
                  Shrink;

                

        

        

        
          	
                   
      

                	
                  (d)

                	
                  imbalance;

                

        

        

        
          	
                   
      

                	
                  (e)

                	
                  change
      in Inventory character;

                

        

        

        
          	
                   
      

                	
                  (f)

                	
                  change
      in Inventory composition;

                

        

        

        
          	
                   
      

                	
                  (g)

                	
                  change
      in Inventory mix;

                

        

        

        
          	
                   
      

                	
                  (h)

                	
                  mark-downs
      (both permanent and point of sale);

                
	 	 	 
	 	(i)	retail
      mark-ons and mark-ups inconsistent with prior period practice and
      performance, industry standards, current business plans or advertising
      calendar and planned advertising events;

        

         

        
          	
                   
      

                	
                  (j)

                	
                  reasonably
      anticipated changes in appraised value of Inventory between appraisals;
      and

                

        

        

        
          	
                   
      

                	
                  (k)

                	
                  Out-of-date
      and/or expired Inventory.

                

        

        

        "Investment" means, as
to any Person, any direct or indirect acquisition or investment by such Person,
whether by means of (a) the purchase or other acquisition of Equity Interests of
another Person, (b) a loan, advance or capital contribution to, Guarantee or
assumption of debt of, or purchase or other acquisition of any other debt or
equity participation or interest in, another Person, including any partnership
or joint venture interest in such other Person and any arrangement pursuant to
which the investor Guarantees Indebtedness of such other Person, or (c) any
Acquisition; provided, however, that any
amount payable by a vendor to any Loan Party with respect to the return of
inventory or supplies by such Loan Party to such vendor in the ordinary course
of business shall not constitute an “Investment” hereunder so long as (i) such
amount has not been outstanding for more than 150 days and (ii)
such

        
          
            
            

          

          
            27

            
              

            

          

          
            
            

          

           

        

        inventory is not then included in the Borrowing Base. For purposes
of covenant compliance, the amount of any Investment shall be the amount
actually invested, without adjustment for subsequent increases or decreases in
the value of such Investment.

        

        "IRS" means the United
States Internal Revenue Service.

        

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

        

        "Issuer Documents"
means with respect to any Letter of Credit, the Letter of Credit Application,
and any other document, agreement and instrument entered into by the LC Issuer
and any Borrower (or any Subsidiary) or in favor the LC Issuer and relating to
any such Letter of Credit.

        

        "Joinder Agreement"
means an agreement, substantially in the form of Exhibit J hereto and
otherwise in form satisfactory to the Administrative Agent pursuant to which,
among other things, a Person becomes a party to, and bound by the terms of, this
Agreement and/or the other Loan Documents in the same capacity and to the same
extent as either a Borrower or a Guarantor, as the Administrative Agent may
determine.

        

        "Junior Subordinated Seller
Note" means that certain Junior Subordinated Seller Note dated as of the
date hereof by the Lead Borrower in favor of the Sellers in an original
principal amount of $150,000,000 and having a maturity date of September __,
2014, in the form of Exhibit H
hereto.

        

        "Laws" means each
international, foreign, federal, state and local statute, treaty, rule,
guideline, regulation, ordinance, code and administrative or judicial precedent
or authority, including the interpretation or administration thereof by any
Governmental Authority charged with the enforcement, interpretation or
administration thereof, and each applicable administrative order, directed duty,
request, license, authorization and permit of, and agreement with, any
Governmental Authority, in each case whether or not having the force of
law.

        

        "LC Advance" means,
with respect to each Lender, such Lender’s funding of its participation in any
LC Borrowing in accordance with its Applicable Percentage.

        

        "LC Borrowing" means
an extension of credit resulting from a drawing under any Letter of Credit which
has not been reimbursed on the date when made or refinanced as a Committed
Borrowing.

        

        "LC Credit Extension"
means, with respect to any Letter of Credit, the issuance thereof or extension
of the expiry date thereof, or the increase of the amount thereof.

        

        "LC Issuer" means (a)
Bank of America, JPMorgan Chase Bank, N.A., Wells Fargo Retail Finance, LLC
(through its Affiliate, Wells Fargo Bank, N.A.) and Sovereign Bank, each in its
capacity as issuer of Letters of Credit hereunder, or any successor issuer of
Letters of Credit hereunder (which successor may only be a Lender selected by
the Administrative Agent in its discretion and, so long as no Event of Default
has occurred and is continuing, consented to by the Lead Borrower), and (b) with
respect to the Existing Letters of Credit and until such Existing Letters of
Credit expire or are returned undrawn, Bank of America. The LC Issuer may, in
its discretion and with the consent of the Lead Borrower which shall not be
unreasonably withheld, arrange for one or more Letters of Credit to be issued by
Affiliates of the LC Issuer, in which case the term "LC Issuer" shall include
any such Affiliate with respect to Letters of Credit issued by such
Affiliate.

         

        
          
            
            

          

          
            28

            
              

            

          

          
            
            

          

           

        

        "LC
Obligations" mean, as at any date of determination, the aggregate undrawn
amount available to be drawn under all outstanding Letters of Credit plus the
aggregate of all Unreimbursed Amounts, including all LC Borrowings. For purposes
of computing the amounts available to be drawn under any Letter of Credit, the
amount of such Letter of Credit shall be determined in accordance with Section 1.06. For all
purposes of this Agreement, if on any date of determination a Letter of Credit
has expired by its terms but any amount may still be drawn thereunder by reason
of the operation of Rule 3.14 of the ISP, such Letter of Credit shall be deemed
to be "outstanding" in the amount so remaining available to be
drawn.

        

        "Lease" means any
agreement, whether written or oral, no matter how styled or structured, pursuant
to which a Loan Party is entitled to the use or occupancy of any real property
for any period of time.

         

        "Lender" has the
meaning specified in the introductory paragraph hereto and, as the context
requires, includes the Swing Line Lender.

        

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

        

        "Letter of Credit"
means each Standby Letter of Credit and each Commercial Letter of Credit issued
hereunder and shall include the Existing Letters of Credit and bankers’
acceptances.

        

        "Letter of Credit
Application" means an application and agreement for the issuance or
amendment of a Letter of Credit in the form from time to time in use by any
applicable LC Issuer.

        

        "Letter of Credit Expiration
Date" means the day that is five (5) days prior to the Maturity Date then
in effect (or, if such day is not a Business Day, the next preceding Business
Day).

        

        "Letter of Credit Fee"
has the meaning specified in Section
2.03(i).

        

        "Letter of Credit
Sublimit" means an amount equal to $100,000,000. The Letter of Credit
Sublimit is part of, and not in addition to, the Aggregate Commitments. A
permanent reduction of the Aggregate Commitments shall not require a
corresponding pro rata reduction in the Letter of Credit Sublimit; provided,
however, that if the Aggregate Commitments are reduced to an amount less than
the Letter of Credit Sublimit, then the Letter of Credit Sublimit shall be
reduced to an amount equal to (or, at Lead Borrower’s option, less than) the
Aggregate Commitments.

        

        "LIBO Borrowing" means
a Borrowing comprised of LIBO Rate Loans.

        

        "LIBO Rate" means for
any Interest Period with respect to a LIBO Rate Loan, the rate per annum equal
to the British Bankers Association LIBOR Rate ("BBA LIBOR"), as
published by Reuters (or other commercially available source providing
quotations of BBA LIBOR as designated by the Administrative Agent from time to
time) at approximately 11:00 a.m., London time, two Business Days prior to the
commencement of such Interest Period, for Dollar deposits (for delivery on the
first day of such Interest Period) with a term equivalent to such Interest
Period. If such rate is not available at such time for any reason, then the
"LIBO Rate" for such Interest Period shall be the rate per annum determined by
the Administrative Agent to be the rate at which deposits in Dollars for
delivery on the first day of such Interest Period in same day funds in the
approximate amount of the LIBO Rate Loan being made, continued or converted by
Bank of America and with a term equivalent to such Interest Period would be
offered by Bank of America’s London Branch to major banks in the London
interbank eurodollar market

         

        
          
            
            

          

          
            29

            
              

            

          

          
            
            

          

        

        

        at their request at approximately 11:00 a.m. (London time) two
Business Days prior to the commencement of such Interest
Period.

        

        "LIBO Rate Loan" means
a Committed Loan that bears interest at a rate based on the Adjusted LIBO
Rate.

        

        "Lien" means (a) any
mortgage, deed of trust, pledge, hypothecation, assignment, deposit arrangement,
encumbrance, lien (statutory or other), charge, or preference, priority or other
security interest or preferential arrangement in the nature of a security
interest of any kind or nature whatsoever (including any conditional sale,
Capital Lease Obligation, Synthetic Lease Obligation, or other title retention
agreement, any easement, right of way or other encumbrance on title to real
property, and any financing lease having substantially the same economic effect
as any of the foregoing) and (b) in the case of securities, any purchase option,
call or similar right of a third party with respect to such
securities.

        

        "Liquidation" means
the exercise by the Administrative Agent or Collateral Agent of those rights and
remedies accorded to such Agents under the Loan Documents and applicable Law as
a creditor of the Loan Parties with respect to the realization on the
Collateral, including (after the occurrence and during the continuation of an
Event of Default) the conduct by the Loan Parties acting with the consent of the
Administrative Agent and the Arrangers, of any public, private or
"going-out-of-business", "store closing" or other similar sale or any other
disposition of the Collateral for the purpose of liquidating the Collateral.
Derivations of the word "Liquidation" (such as "Liquidate") are used with like
meaning in this Agreement.

        

        "Loan" means an
extension of credit by a Lender to any Borrower under Article II in the
form of a Committed Loan or a Swing Line Loan.

        

        "Loan Cap" means, at
any time of determination, the lesser of (a) the Aggregate Commitments at such
time and (b) the Borrowing Base at such time.

        

        "Loan Account" has the
meaning assigned to such term in Section
2.11(a).

        

        "Loan Documents" means
this Agreement, each Note, each Issuer Document, the Fee Letter, all Borrowing
Base Certificates, the Blocked Account Agreements, the DDA Notifications, the
Credit Card Notifications, the Security Documents, the Facility Guaranty, and
any other instrument or agreement now or hereafter executed and delivered in
connection herewith, each as amended and in effect from time to
time.

        

        "Loan Party" means the
Borrowers and each Guarantor.

        

        "Material Adverse
Effect" means (a) a material adverse change in, or a material adverse
effect upon, the operations, business, properties, liabilities (actual or
contingent), or condition (financial or otherwise) of any Loan Party or the Lead
Borrower and its Subsidiaries taken as a whole; (b) impairment of the ability of
any Loan Party to perform its material obligations under any material Loan
Document to which it is a party; or (c) a material impairment of the rights and
remedies of the Agent or the Lenders under any material Loan Document or a
material adverse effect upon the legality, validity, binding effect or
enforceability against any Loan Party of any Loan Document to which it is a
party. In determining whether any individual event would result in a Material
Adverse Effect, notwithstanding that such event in and of itself does not have
such effect, a Material Adverse Effect shall be deemed to have occurred if the
cumulative effect of such event and all other then existing events would result
in a Material Adverse Effect.

         

        
          
            
            

          

          
            30

            
              

            

          

          
            
            

          

           

        

        "Material
Contract" means, with respect to any Person, (a) each contract, security,
instrument or agreement which such Person has reported or is required to report
as a “Material Contract” under and in accordance with Item 601(b)(10) of
Regulation S-K and/or Regulation S-B of the Securities Act and (b) each vendor
or customer contract, security agreement or instrument the breach or termination
of which would have a Material Adverse Effect.

        

        "Material
Indebtedness" means Indebtedness (other than the Obligations) of the Loan
Parties in an aggregate principal amount exceeding $35,000,000. Without
limitation of the foregoing, the obligations under the Seller Notes, each as
amended and in effect on the Closing Date, and any Permitted Senior Debt shall
be deemed Material Indebtedness. For purposes of determining the amount of
Material Indebtedness at any time, the amount of the obligations in respect of
any Swap Contract at such time shall be calculated at the Swap Termination Value
thereof.

        

        "Material Storage
Location" means (a) the warehouse leased by the Lead Borrower in Monroe,
New Jersey, or Reno, Nevada, (b) the warehouse leased by Sterling Publishing
Co., Inc., at 48 Saw Mill Pond Road, Edison, New Jersey or 30 Saw Mill Pond
Road, Edison, New Jersey, or (c) any replacement for such facilities or any
other warehouse or other storage space leased by any Loan Party for the storage
of similar amounts of Inventory as are or are anticipated to be stored at any of
the locations described in clauses (a) and (b) of this definition as of the
Closing Date.

        

        "Material Store
Acquisition" means (a) with respect to the Lead Borrower and its
Subsidiaries (other than BNCB and its Subsidiaries), the acquisition in a single
transaction or series of related transactions of stores, store leases and or
inventory at store locations (other than acquisitions or openings of new stores
in the ordinary course of business) for consideration in excess of (i)
$25,000,000 for any such single or series of related transactions or (ii)
$75,00,000 in the aggregate for any Fiscal Year and (b) with respect to BNCB and
its Subsidiaries, the acquisition of more than 50 bookstore contracts or leases
in a single transaction or series of related transactions, either through
assumption or replacement of existing contracts or leases between third parties
and the applicable college, university or other educational
institution.

        

        "Maturity Date" means
September 29, 2013.

        

        "Maximum DDA Balance"
means, with respect to each DDA, an amount equal to (a) $1,000 times (b) the
aggregate number of Stores that maintain deposits in such DDA.

        

        "Maximum Rate" has the
meaning provided therefor in Section
10.09.

        

        "Measurement Period"
means, at any date of determination, the most recently completed twelve (12)
consecutive Fiscal Months of the Lead Borrower for which financial statements
have or should have been delivered in accordance with Section
6.01.

        

        "Moody’s" means
Moody’s Investors Service, Inc. and any successor thereto.

        

        "Mortgage" means each
fee mortgage or deed of trust, security agreement and assignment by a Loan Party
owning the Real Estate encumbered thereby in favor of the Collateral Agent in
form and substance acceptable to the Collateral Agent in its Permitted
Discretion.

        

        "Mortgage Related
Document" means each Title Policy, Survey, Environmental Assessment,
Flood Zone Certification and FIRREA Documents related to each parcel of Real
Estate subject to a Mortgage and all related certifications, evidences of
permits and licenses and other documents and certifications reasonably requested
by the Administrative Agent in connection with establishing,

         

        
          
            
            

          

          
            31

            
              

            

          

          
            
            

          

        

        

        maintaining and protecting such Real Estate and the Administrative
Agent's interest therein and lien thereon.

        

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

        

        "Net Orderly Liquidation
Value" means the appraised orderly liquidation value of the Borrowers’
Inventory, net of costs and expenses to be incurred in connection with any such
liquidation, which value is expressed as a percentage of Cost of the Borrowers’
Inventory as set forth in the Borrowers’ inventory stock ledger, which value
shall be determined from time to time by the most recent appraisal undertaken by
an independent appraiser engaged by the Administrative Agent.

        

        "Net Proceeds" means
(a) with respect to any Prepayment Event described in clause (a) or (b) of the
definition thereof, the excess, if any, of (i) the sum of cash and cash
equivalents received in connection with such transaction (including any cash or
cash equivalents received by way of deferred payment pursuant to, or by
monetization of, a note receivable or otherwise, but only as and when so
received) over (ii) the sum of (A) the principal amount of any Indebtedness that
is secured by the applicable asset by a Lien permitted hereunder which is senior
to the Collateral Agent’s Lien on such asset and that is required to be repaid
(or to establish an escrow for the future repayment thereof) in connection with
such transaction (other than Indebtedness under the Loan Documents), (B) the
reasonable and customary out-of-pocket expenses incurred by such Loan Party or
such Subsidiary in connection with such transaction (including, without
limitation, appraisals, and brokerage, legal, title and recording or transfer
tax expenses and commissions) paid by any Loan Party to third parties (other
than Affiliates)), (C) commercially reasonable amounts provided as a funded
reserve against any liabilities under any indemnification obligations or
purchase price adjustments associated with such Dispositions, and (D) if no
Trigger Period shall then be in effect, all federal, state, provincial, foreign
and local taxes required to be accrued as a liability under GAAP, and (b) with
respect to the sale or issuance of any Equity Interest by any Loan Party or any
of its Subsidiaries, or the incurrence or issuance of any Indebtedness by any
Loan Party or any of its Subsidiaries, the excess of (i) the sum of the cash and
cash equivalents received in connection with such transaction over (ii) the sum
of (x) the underwriting discounts and commissions, and other reasonable and
customary out-of-pocket expenses, incurred by such Loan Party or such Subsidiary
in connection therewith and (y) all distributions and other payments required to
be made to minority interest holders in such Person as a result of such
sale.

        

        "Non-Consenting
Lender" has the meaning provided therefor in Section
10.01.

        

        "Non-Extension Notice
Date" has the meaning specified in Section
2.03(b)(iii).

        

        "Note" means (a) a
promissory note made by the Borrowers in favor of a Lender evidencing Loans made
by such Lender, substantially in the form of Exhibit C-1, and (b)
the Swing Line Note, as each may be amended, supplemented or modified from time
to time.

        

        "NPL" means the
National Priorities List under CERCLA.

        

        "Obligations" means
all advances to, and debts (including principal, interest, fees, costs, and
expenses), liabilities, obligations, covenants, indemnities, and duties of, any
Loan Party arising under any Loan Document or otherwise with respect to any Loan
or Letter of Credit (including payments in respect of reimbursement of
disbursements, interest thereon and obligations to provide cash collateral
therefor), whether direct or indirect (including those acquired by assumption),
absolute or contingent, due or to

        

        
          
            
            

          

          
            32

            
              

            

          

          
            
            

          

        

        

        become due, now existing or hereafter arising and including
interest, fees, costs and expenses that accrue after the commencement by or
against any Loan Party or any Affiliate thereof of any proceeding under any
Debtor Relief Laws naming such Person as the debtor in such proceeding,
regardless of whether such interest, fees, costs and expenses are allowed claims
in such proceeding.

        

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

        

        "Other Liabilities"
means any obligation of any Loan Party (a) arising under any document or
agreement relating to or (b) on account of (i) any Cash Management Services
and/or (ii) any Bank Product.

        

        "Other Taxes" means
all present or future stamp or documentary taxes or any other excise or property
taxes, charges or similar levies arising from any payment made hereunder or
under any other Loan Document or from the execution, delivery or enforcement of,
or otherwise with respect to, this Agreement or any other Loan
Document.

        

        "Outstanding Amount"
means (i) with respect to Committed Loans and Swing Line Loans on any date, the
aggregate outstanding principal amount thereof after giving effect to any
borrowings and prepayments or repayments of Committed Loans and Swing Line
Loans, as the case may be, occurring on such date; and (ii) with respect to any
LC Obligations on any date, the amount of such LC Obligations on such date after
giving effect to (A) any LC Credit Extension occurring on such date and (B) any
other changes in the aggregate amount of the LC Obligations as of such date,
including as a result of any reimbursements by the Borrowers of Unreimbursed
Amounts.

        

        "Overadvance" means a
Credit Extension to the extent that, immediately after its having been made,
Availability is less than zero.

        

        "Participant" has the
meaning specified in Section
10.06(d).

        

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

        

        "Patriot Act" shall
have the meaning provided in Section
4.01(j).

        

        "PBGC" means the
Pension Benefit Guaranty Corporation.

        

        "PCAOB" means the
Public Company Accounting Oversight Board.

        

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

        

        
          
            
            

          

          
            33

            
              

            

          

          
            
            

          

           

        

        "Permitted
Acquisition" means an Acquisition in which all of the following
conditions are satisfied:

        

        
          (a)    
     no
Default then exists or would arise from the consummation of such Acquisition;

        

        

        (b)          such
Acquisition shall have been approved by the Board of Directors of the Person (or
similar governing body if such Person is not a corporation) which is the subject
of such Acquisition and such Person does not otherwise oppose such
Acquisition;

        

        
           (c)        
the
Lead Borrower shall have furnished the Administrative Agent with (i) thirty
(30) days’
prior written notice (or such shorter period of not less than ten (10) days
prior to such Acquisition as the Administrative Agent may agree in its
reasonable discretion) of each such intended Acquisition;

        

        

        (d)           with
respect to any such Acquisition (in a single or series of related transactions)
involving aggregate consideration (whether in cash, tangible property, notes or
other property) in excess of $25,000,000 individually or in excess of
$75,000,000 in the aggregate, the Lead Borrower promptly (and in any event, no
less than five (5) Business Days prior to the consummation of such Acquisition
or such shorter period as may otherwise be agreed by the Administrative Agent in
its reasonable discretion) shall furnish to the Administrative Agent such
documentation, if any, that the Administrative Agent may reasonably request,
which may include a current draft of the documents, agreements and instruments
contemplated to be executed in connection therewith (and final copies thereof as
and when executed), a summary of any due diligence undertaken by the Loan
Parties in connection with such Acquisition;

        

        (e)           any
assets acquired shall be utilized in, and if the Acquisition involves a merger,
consolidation or stock acquisition, the Person which is the subject of such
Acquisition shall be engaged in, a Business substantially the same as one or
more line or lines of Business of the Lead Borrower and its Subsidiaries or
Substantially related, incidental or complimentary thereto and otherwise
permitted to be engaged in by a Borrower under this Agreement;

        

        (f)           if
the Person which is the subject of such Acquisition will be maintained as a
wholly-owned Subsidiary of a Loan Party, or if the assets acquired in an
Acquisition will be transferred to a wholly-owned Subsidiary which is not then a
Loan Party, such wholly-owned Subsidiary shall, to the extent not prohibited by
the terms of Indebtedness of such Person permitted by Section 7.03(h)
hereof, have been joined as a "Borrower" hereunder or as a Guarantor, as the
Administrative Agent shall determine in its Permitted Discretion, and the
Collateral Agent shall, to the extent not prohibited by the terms of
Indebtedness of such Person permitted by Section 7.03(h)
hereof, have received a first-priority security interest in such Subsidiary’s
Inventory, Accounts, Real Estate and other property of the same nature as
constitutes Collateral of the Borrowers under the Security Documents;
and

         

        (g)           (i)
Projected Excess Availability and Pro Forma Excess Availability as of the date
of consummation of such Acquisition will be equal to or greater than twenty
percent (20.0%) of the Loan Cap, (ii) the Consolidated Fixed Charge Coverage
Ratio, on a pro-forma basis for the Measurement Period immediately prior to such
Acquisition, will be equal to or greater than 1.1 to 1.0 and (iii) the Lead
Borrower shall have delivered written certification as to satisfaction, and a
reasonably detailed calculation, of items (i) and (ii) above five (5) Business
Days (or such shorter period not less than two (2) Business Days prior to such
Acquisition as the Administrative Agent may agree to in its reasonable
discretion) prior to the date of such Acquisition.

         

        
          
            
            

          

          
            34

            
              

            

          

          
            
            

          

           

        

        "Permitted
Buy-Back Programs" means seasonal buy-back programs of college text books
in accordance with leases, contracts or other instruments or agreements
governing its Stores and otherwise in accordance with customary business
practices in the college bookselling industry.

        

        "Permitted Discretion"
means a determination made in good faith and in the exercise of commercially
reasonable business judgment, determined in a manner consistent with its credit
procedures for asset-based lending transactions in the retail industry and
otherwise in similar circumstances.

        

        "Permitted
Disposition" has the meaning specified in Section
7.05.

        

        "Permitted
Encumbrances" has the meaning specified in Section
7.01.

        

        "Permitted
Indebtedness" has the meaning specified in Section
7.03.

        

        "Permitted
Investments" has the meaning specified in Section
7.02.

        

        "Permitted
Overadvance" means an Overadvance made by the Administrative Agent, in
its discretion (unless the Required Lenders direct the Administrative Agent not
to make or to discontinue making Overadvances), which:

        

        (a)           Is
made to maintain, protect or preserve the Collateral and/or the Credit Parties’
rights under the Loan Documents or which is otherwise for the benefit of the
Credit Parties; or

        

        
          (b)    
      Is made
to enhance the likelihood of, or to maximize the amount of, repayment of
any
Obligation;

        

        

        
          (c)        
  Is made
to pay any other amount chargeable to any Loan Party hereunder;
and

        

        

        (d)           Together
with all other Permitted Overadvances then outstanding, shall not (i) exceed
five percent (5.0%) of the Loan Cap at any time or (ii) unless a Liquidation is
occurring, remain outstanding for more than forty-five (45) consecutive Business
Days, unless in each case, the Required Lenders otherwise agree.

        

        provided however,
that the foregoing shall not (i) modify or abrogate any of the provisions
of Section 2.03
regarding the Lender’s obligations with respect to Letters of Credit, or
(ii) result in any claim or liability
against the Administrative Agent (regardless of the amount of any Overadvance)
for "inadvertent Overadvances" (i.e. where an Overadvance results from changed
circumstances beyond the control of the Administrative Agent (such as a
reduction in the collateral value)), and such "inadvertent Overadvances" shall
not reduce the amount of Permitted Overadvances allowed hereunder, and further provided that
in no event shall the Administrative Agent make an Overadvance, if after giving
effect thereto, the principal amount of the Credit Extensions would exceed the
Aggregate Commitments (as in effect prior to any termination of the Commitments
pursuant to Section
2.06 hereof).

        

        "Permitted Real Estate
Liens" means with respect to any Eligible Real Estate encumbered by a
Mortgage in favor of the Collateral Agent, collectively, Permitted Encumbrances
and, the Liens referred to in Schedule B of the Title Policy insuring the
Collateral Agent’s interest under such Mortgage.

        

        "Permitted
Refinancing" means, with respect to any Indebtedness, any refinancing,
refunding, renewal or extension of such Indebtedness, so long as (i) the amount
of such Indebtedness is not increased at the time of such refinancing,
refunding, renewal or extension except by an amount equal to a reasonable
premium or other reasonable amount paid, and fees and expenses reasonably
incurred, in

        

        
          
            
            

          

          
            35

            
              

            

          

          
            
            

          

        

         

        connection with such refinancing and by an amount equal to any
existing commitments unutilized thereunder, and the direct or contingent obligor
with respect thereto is not changed as a result of or in connection with such
refinancing, refunding, renewal or extension, (ii) such extension, renewal or
replacement shall not result in an earlier maturity date or decreased weighted
average life of such Indebtedness, (iii) the terms relating to principal amount,
amortization, maturity, collateral (if any) and subordination (if any), and
other material terms taken as a whole, of any such refinancing, refunding,
renewing or extending Indebtedness, and of any agreement entered into and of any
instrument issued in connection therewith, are no less favorable in any material
respect to the Credit Parties than the terms of any agreement or instrument
governing the Indebtedness being refinanced, refunded, renewed or extended and
(iv) the interest rate applicable to any such refinancing, refunding, renewing
or extending Indebtedness does not exceed the then applicable market interest
rate for comparative transactions of such nature.

        

        "Permitted Self-Insurance
Program" means a self-insurance program of the Lead Borrower and its
Subsidiaries (a)(i) that is administered through Chelsea Insurance Company Ltd.,
a wholly-owned Subsidiary of the Lead Borrower, (ii) that is permitted under
applicable Laws, (iii) of an amount and type customarily carried by Persons
engaged in the same or similar business and operating in the same or similar
locations, (iv) with respect to which the Lead Borrower has provided the
Administrative Agent notice of activation of such program at least 30 days prior
to such program becoming effective, and (v) that otherwise satisfies the
requirements set forth in Section 6.07; provided, however, that no
self- insurance program may directly insure all or any portion of the Collateral
unless (x) such self-insurance program satisfies the foregoing requirements and
(y) the Collateral Agent (in consultation with the Arrangers) consents in
writing (such consent not to be unreasonably withheld or delayed) to the form
and substance of such self-insurance program; and (b) with respect to worker’s
compensation that is permitted under applicable Laws and of an amount and type
customarily carried by Persons engaged in the same or similar business and
operating in the same or similar locations.

        

        "Permitted Senior
Debt" means Indebtedness of the Lead Borrower evidenced by senior notes
or similar instruments and any guaranty obligations of the Lead Borrower's
Subsidiaries (other than Immaterial Subsidiaries) with respect thereto, in any
aggregate principal amount of up to $750,000,000, all pursuant to an indenture
and guaranty agreements, as applicable, and on terms and conditions reasonably
acceptable to the Administrative Agent, the majority of the Arrangers and the
Required Lenders, such terms and conditions to include, but not be limited to
the following:

        

        (a)           no
portion of the principal of such Indebtedness shall be required to be paid,
whether by stated maturity, mandatory or scheduled prepayment or redemption or
otherwise, prior to the date that is 180 days after the Maturity Date, other
than in the event of (i) a default under such Indebtedness, (ii) a change of
control of the Lead Borrower or (iii) certain asset sales in each case, subject
to the standstill and the lien subordination provisions described in clause (d)
below;

        

        (b)           such
Indebtedness may be secured by a first priority Lien on Excluded Assets only and
a second priority Lien on any Collateral (provided the Administrative Agent for
the benefit of the Secured Parties is granted a second priority Lien on all
Excluded Assets securing such Indebtedness);

        

        (c)           the
documents, instruments and other agreements pursuant to which such Indebtedness
shall be issued or outstanding shall not be more restrictive than those
contained in this Agreement or the other Loan Documents taken as a whole or
conflict with or violate the covenants or otherwise create Defaults under this
Agreement or the other Loan Documents; and

         

        
          
            
            

          

          
            36

            
              

            

          

          
            
            

          

        

        

        (d) such Indebtedness shall be subject to an intercreditor agreement
acceptable to the Administrative Agent, the majority of the Arrangers and the
Required Lenders addressing, among other things, (A) the priority of the Liens
securing the Collateral and Excluded Assets and the payment of proceeds
therefrom, (B) a standstill by the holders of such Indebtedness as to remedies
against the Collateral, (C) waivers by the holders of such Indebtedness of
rights to contest validity or priority of Liens of the Administrative Agent or
the Lenders or object to dispositions of Collateral (including an affirmative
agreement by such holders to release Liens of such holders in the event of a
disposition of Collateral approved by the Administrative Agent and Required
Lenders), (D) waiver of rights to object to the use of cash collateral or sale
of Collateral, and restrictions on certain claims and actions, in any proceeding
under any Debtor Relief Laws by the holders of such Indebtedness, and (E)
restrictions on amendments to, or consents, waivers or other modifications with
respect to, the documents evidencing such Indebtedness.

        

        "Permitted Senior Seller Note
Payments" means any payment or prepayment of the principal amount of the
Senior Subordinated Seller Note permitted (a) pursuant to the terms thereof
(including terms of subordination) as in effect on the Closing Date and (b)
under Section
7.07.

        

        "Permitted Tax
Distribution" means the cash distributions in an aggregate amount of up
to $50,000,000 made to one or more of the Sellers pursuant to the terms of the
BNCB Purchase Agreement in respect of the income tax liability of the Sellers
associated with the ordinary business income of BNCB through the Closing Date,
notice of which shall be delivered pursuant to Section 6.02(g)
hereof.

        

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

        

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

        

        "Platform" has the
meaning specified in Section
6.02.

        

        "Prepayment Event"
means:

        

        (a)           Any
Disposition of any Inventory, Accounts or Mortgaged Property of a Loan Party,
other than (i) sales of Inventory in the ordinary course of business and (ii) so
long as no Trigger Period exists, a Disposition (or series of related
dispositions) of Inventory, Accounts or Mortgaged Property resulting in Net
Proceeds of $15,000,000 or less;

        

        (b)           Any
casualty or other insured damage to, or any taking under power of eminent domain
or by condemnation or similar proceeding of, any Mortgaged Real Estate of a Loan
Party, unless (i) the proceeds therefrom are required to be paid to the holder
of a Lien on such property or asset having priority over the Lien of the
Collateral Agent; or (ii) other than during a Trigger Period, the proceeds
therefrom are utilized for purposes of replacing or repairing the assets in
respect of which such proceeds, awards or payments were received within 270 days
of the occurrence of the damage to or loss of the assets being repaired or
replaced; or

        

        
          (c)        
The  issuance  by  a  Loan  Party  other  than  the  Lead  Borrower  of  any  Equity

        

        

        Interests,
other than any such issuance of Equity Interests (i) to a Loan Party, (ii) as
consideration for a Permitted Acquisition or (iii) as a compensatory issuance or
in connection with any employee retention program, plan or agreement to any
employee, director, or consultant

         

        
          
            
            

          

          
            37

            
              

            

          

          
            
            

          

        

        

        (including under any option plan), in each case under this clause
(iii), in the ordinary course of business.

        

        "Pro Forma Excess
Availability" means, for any date of calculation, the pro forma average
Availability for each Fiscal Month for the Measurement Period most recently
ended prior to such date of calculation determined as if the applicable
transaction or payment had been consummated as the beginning of such Twelve
Month Period.

        

        "Projected Excess
Availability" means, for any date of calculation, the projected average
Availability for each Fiscal Month during the Twelve Month Period immediately
following such date of calculation.

        

        "Public Lender" has
the meaning specified in Section
6.02.

        

        "Real Estate" means
(i) all land, together with the buildings, structures, parking areas, and other
improvements thereon, now or hereafter owned by any Loan Party, including all
easements, rights-of- way, and similar rights of a Loan Party or in favor of a
Loan Party relating thereto and all leases, tenancies, and occupancies thereof
and (ii) all Leases.

        

        "Real Estate Eligibility
Requirements" means, collectively, each of the following:

        

        (a)           the
applicable Borrower has executed and delivered to the Collateral Agent a
Mortgage with respect to any Real Estate intended, by such Borrower, to be
included in Eligible Real Estate;

        

        (b)           such
Real Estate is vacant land or used by a Borrower or a lessee or licensee of a
Borrower for offices, as a Store or distribution center or for other purposes
not prohibited by this Agreement or the other Loan Documents;

        

        (c)           as
to any particular property, the applicable Borrower is in compliance in all
material respects with the representations, warranties and covenants set forth
in the Mortgage relating to such Real Estate;

        

        (d)           the
Collateral Agent shall have received fully paid American Land Title Association
Lender’s Extended Coverage title insurance policies (or marked-up title
insurance commitments having the effect of a policy of title insurance) (the
"Title
Policies") in form and substance, with the endorsements reasonably
required by the Collateral Agent (to the extent available at commercially
reasonable rates) and in amounts reasonably acceptable to the Collateral Agent,
issued by First American Title Insurance Company, Fidelity Title Insurance
Company or other title insurers reasonably acceptable to the Collateral Agent,
insuring the Mortgages to be valid first priority Liens on the property
described therein, subject only to Permitted Encumbrances set forth in Sections 7.01(a),
(c) and (h), provided that with
respect to any Liens for Taxes being contested in compliance with Section 6.04, such
Liens are insured over by the applicable Title Policy and such other Liens as
may be approved by the Collateral Agent in its Permitted
Discretion;

        

        (e)           the
Collateral Agent shall have received: (i) American Land Title
Association/American Congress on Surveying and Mapping form surveys, for which
all necessary fees (where applicable) have been paid, certified to the
Collateral Agent and the issuer of the Title Policies in a manner reasonably
satisfactory to the Collateral Agent by a land surveyor duly registered and
licensed in the states in which the property described in such surveys is
located and reasonably acceptable to the Collateral Agent, showing all buildings
and other improvements, the location of any easements, parking spaces, rights of
way, building set-back lines and other dimensional regulations and the absence
of encroachments, either

         

        
          
            
            

          

          
            38

            
              

            

          

          
            
            

          

        

        

        by such improvements or on to such property, and other defects,
other than encroachments and other defects that are Permitted Encumbrances
listed in Section
7.01(h) or are reasonably acceptable to the Collateral Agent, or (ii)
survey coverage either in the form of deleting or endorsing over a survey
exception and by providing survey endorsements in form reasonably acceptable to
the Collateral Agent (in either case, such surveys or evidence of deletion of or
endorsement over being referred to herein as the "Surveys");

        

        (f)           with
respect to any Real Estate intended by any Borrower to be included in Eligible
Real Estate, the Collateral Agent shall have received a Phase I Environmental
Site Assessment in accordance with ASTM Standard E1527-05, in form and substance
reasonably satisfactory to the Collateral Agent, from Environmental Resources
Management or another environmental consulting firm reasonably acceptable to the
Collateral Agent (each an "Environmental
Assessment"), for such Real Estate to be included in Eligible Real
Estate, the Collateral Agent may, upon the receipt of an Environmental
Assessment, require the delivery of further environmental assessments or reports
to the extent such further assessments or reports are recommended in the
Environmental Assessment;

        

        (g)           Borrower
shall have delivered to the Collateral Agent (i) evidence of flood insurance, if
required by applicable Law, that covers any parcel of improved Real Estate that
is encumbered by a Mortgage in favor of the Collateral Agent, which insurance
shall name the Collateral Agent as mortgagee and shall be in an amount and in
such form that complies with the requirements under the National Flood Insurance
Act or (ii) a flood zone certification that such parcel is not located in a
flood zone and that such flood insurance is not required by applicable Law (in
either case, "Flood
Zone Certification");

        

        (h)           the
applicable Borrower shall have delivered such other information and documents as
may be reasonably requested by the Agents to the extent necessary to comply with
FIRREA ("FIRREA
Documents");

        

        (i)           no
material waste, impairment, or deterioration of the “Property” (as defined in
the Mortgages) shall have been committed and such Property shall not have been
abandoned;

        

        (j)           the
applicable Borrower shall have delivered a favorable opinion of local counsel to
the Loan Parties in the jurisdiction where such Real Estate is located,
addressed to the Administrative Agent and the Lenders, as to such matters
concerning such Borrower, the Mortgage and the Real Estate as the Administrative
Agent may request in its Permitted Discretion; and

        

        (k)           if
requested by the Collateral Agent, the Borrower shall have delivered a
commercially reasonable subordination, non-disturbance and attornment agreement,
in form and substance acceptable to the Collateral Agent in its Permitted
Discretion, with any tenants with respect to such Real Estate.

        

        "Realty Reserves"
means, without duplication of any other Reserve or items that are otherwise
addressed or excluded thorough eligibility criteria, such reserves as the
Administrative Agent from time to time determines in the Administrative Agent’s
Permitted Discretion, as reflecting (i) the impediments to the Agents’ ability
to realize upon any Eligible Real Estate, or (ii) claims and liabilities that
the Administrative Agent determines in its Permitted Discretion will need to be
satisfied in connection with the realization upon Eligible Real
Estate.

        

        "Receivables Reserves"
mean such reserves as may be established from time to time by the Administrative
Agent in the Administrative Agent’s Permitted Discretion with respect to the
determination of the collectability in the ordinary course of Eligible Accounts
Receivables, including, without limitation, reserves for dilution.

         

        
          
            
            

          

          
            39

            
              

            

          

          
            
            

          

        

        

        "Register" has the
meaning specified in Section
10.06(c).

        

        "Registered Public Accounting
Firm" has the meaning specified by the Securities Laws and shall be
independent of the Lead Borrower and its Subsidiaries as prescribed by the
Securities Laws.

        

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

        

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

        

        "Reports" has the
meaning provided in Section
9.12(b).

        

        "Request for Credit
Extension" means (a) with respect to a Borrowing, conversion or
continuation of Committed Loans, a Committed Loan Notice, (b) with respect to a
conversion or continuation of Committed Loans, a Conversion/Continuation
Certificate, (c) with respect to an LC Credit Extension, a Letter of Credit
Application, and (d) with respect to a Swing Line Loan, a Swing Line Loan
Notice.

        

        "Required Lenders"
means, as of any date of determination, Lenders holding more than 50.0% of the
Aggregate Commitments or, if the commitment of each Lender to make Loans and the
obligation of the LC Issuer to make LC Credit Extensions have been terminated
pursuant to Section
8.02, Lenders holding in the aggregate more than 50.0% of the Total
Outstandings (with the aggregate amount of each Lender’s risk participation and
funded participation in LC Obligations and Swing Line Loans being deemed "held"
by such Lender for purposes of this definition); provided that the Commitment
of, and the portion of the Total Outstandings held or deemed held by, any
Defaulting Lender shall be excluded for purposes of making a determination of
Required Lenders.

        

        "Reserves" means all
Inventory Reserves, Availability Reserves, Receivables Reserves and Realty
Reserves.

        

        "Responsible Officer"
means the chief executive officer, president, chief financial officer, treasurer
or assistant treasurer or vice president or director of finance of a Loan Party
or any of the other individuals designated in writing to the Administrative
Agent by an existing Responsible Officer of a Loan Party as an authorized
signatory of any certificate or other document to be delivered hereunder, provided that for the
purposes of any Committed Loan Notice, Conversion/Continuation Notice, Letter
of Credit
Application and Swing Line Loan Notice, Responsible Officer shall also include
any officer, director or manager of the treasury department of the Lead Borrower
who is duly authorized to bind the Lead Borrower and with respect to whom the
Administrative Agent has received an incumbency certificate. Any document
delivered hereunder that is signed by a Responsible Officer of a Loan Party
shall be conclusively presumed to have been authorized by all necessary
corporate, partnership and/or other action on the part of such Loan Party and
such Responsible Officer shall be conclusively presumed to have acted on behalf
of such Loan Party.

        

        "Restricted Payment"
means any dividend or other distribution (whether in cash, securities or other
property) with respect to any capital stock or other Equity Interest of any
Person or any of its Subsidiaries, or any payment (whether in cash, securities
or other property), including any sinking fund or similar deposit, on account of
the purchase, redemption, retirement, defeasance, acquisition, cancellation or
termination of any such capital stock or other Equity Interest, or on account of
any return of capital to such Person’s stockholders, partners or members (or the
equivalent of any thereof), or any option, warrant or other right to acquire any
such dividend or other distribution or payment. Without limiting the foregoing,
"Restricted Payments" with respect to any Person shall also include all payments
made by such

         

        
          
            
            

          

          
            40

            
              

            

          

          
            
            

          

        

        

        Person with any proceeds of a dissolution or liquidation of such
Person. For the avoidance of doubt, it is agreed that Permitted Tax
Distributions shall not constitute a Restricted Payment except to the extent
that such Permitted Tax Distribution shall exceed $50,000,000 and then only
shall such incremental amount be considered a restricted
payment.

        

        "S&P" means
Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies,
Inc. and any successor thereto.

        

        "Sarbanes-Oxley" means
the Sarbanes-Oxley Act of 2002.

        

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

        

        "Secured Obligations"
means all Obligations, all Guaranteed Obligations and all Other
Liabilities.

        

        "Secured Parties" has
the meaning set forth in the Security Agreement.

        

        "Securities Laws"
means the Securities Act of 1933, the Securities Exchange Act of 1934,
Sarbanes-Oxley, and the applicable accounting and auditing principles, rules,
standards and practices promulgated, approved or incorporated by the SEC or the
PCAOB.

        

        "Security Agreement"
means the Security Agreement dated as of the Closing Date among the Loan Parties
and the Collateral Agent.

        

        "Security Documents"
means the Security Agreement, the Blocked Account Agreements, the Securities
Account Control Agreements, the DDA Notifications, the Credit Card
Notifications, the Mortgages and each other security agreement or other
instrument or document executed and delivered to the Collateral Agent pursuant
to this Agreement or any other Loan Document granting a Lien to secure any of
the Secured Obligations (including, without limitation, any Lien that may be
granted from time to time upon all or any portion of the Excluded
Assets).

        

        "Sellers" means
Leonard Riggio and Louise Riggio.

        

        "Seller  Notes"  means  the  Junior  Subordinated  Seller  Note  and  the  Senior  Subordinated  Seller
Note.

        

        "Senior Subordinated Seller
Note" means that certain Senior Subordinated Seller Note dated as of the
date hereof by the Lead Borrower in favor of the Sellers in an original
principal amount of $100,000,000 and having a maturity date of December 15,
2010, in the form of Exhibit N
hereto.

        

        "Settlement Date" has
the meaning provided in Section
2.14(a).

        

        "Shareholders’ Equity"
means, as of any date of determination, consolidated shareholders’ equity of the
Lead Borrower and its Subsidiaries as of that date determined in accordance with
GAAP.

        

        "Shrink" means Inventory which has been lost,
misplaced, stolen, or is otherwise unaccounted for.

        

        "Solvent" and "Solvency" means, with
respect to any Person on a particular date, that on such date (a) at fair
valuation, the value of all of the properties and assets of such Person are
greater than the sum of the debts, including contingent liabilities, of such
Person, (b) the present fair saleable value of the

         

        
          
            
            

          

          
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        properties and assets of such Person is not less than the amount
that would be required to pay the probable liability of such Person on its debts
as they become absolute and matured, (c) such Person is able to realize upon its
properties and assets and pay its debts and other liabilities, contingent
obligations and other commitments as they mature in the normal course of
business, (d) such Person does not intend to, and does not believe that it will,
incur debts beyond such Person’s ability to pay as such debts mature, and (e)
such Person is not engaged in a business or a transaction, and is not about to
engage in a business or transaction, for which such Person’s properties and
assets would constitute unreasonably small capital after giving due
consideration to the prevailing practices in the industry in which such Person
is engaged. The amount of all guarantees at any time shall be computed as the
amount that, in light of all the facts and circumstances existing at the time,
can reasonably be expected to become an actual or matured
liability.

        

        "Specified Default"
means any event or condition that constitutes, or with the passage of time would
constitute, an Event of Default under any of clauses (a), (b) (solely with
respect to Section
7.15), (f), (g), (k) or (l) of Section
8.01.

        

        "Specified
Indebtedness" means Permitted Senior Debt or Subordinated
Indebtedness.

        

        "Standby Letter of
Credit" means any Letter of Credit that is not a Commercial Letter of
Credit and that (a) is used in lieu or in support of performance guaranties or
performance, surety or similar bonds (excluding appeal bonds) arising in the
ordinary course of business, (b) is used in lieu or in support of stay or appeal
bonds, (c) supports the payment of insurance premiums for reasonably necessary
casualty insurance carried by any of the Loan Parties, or (d) supports payment
or performance for identified purchases or exchanges of products or services in
the ordinary course of business.

        

        "Stated Amount" means
at any time the maximum amount for which a Letter of Credit may be
honored.

        

        "Statutory Reserve
Rate" means a fraction (expressed as a decimal), the numerator of which
is the number one and the denominator of which is the number one minus the
aggregate of the maximum reserve percentages (including any marginal, special,
emergency or supplemental reserves) expressed as a decimal established by the
FRB to which the Administrative Agent is subject with respect to the Adjusted
LIBO Rate, for eurocurrency funding (currently referred to as "Eurocurrency
Liabilities" in Regulation D of the Board). Such reserve percentages shall
include those imposed pursuant to such Regulation D. LIBO Rate Loans shall be
deemed to constitute eurocurrency funding and to be subject to such reserve
requirements without benefit of or credit for proration, exemptions or offsets
that may be available from time to time to any Lender under such Regulation D or
any comparable regulation. The Statutory Reserve Rate shall be adjusted
automatically on and as of the effective date of any change in any reserve
percentage.

        

        "Store" means any
retail store (which may include any real property, fixtures, equipment,
inventory and other property related thereto) operated, or to be operated, by
any Loan Party.

        

        "Subordinated
Indebtedness" means (a) the Seller Notes and (b) other Indebtedness which
is expressly subordinated in right of payment to the prior payment in full of
the Secured Obligations and which is in form and on terms approved in writing by
the Administrative Agent.

        

        "Subsidiary" of a
Person means a corporation, partnership, joint venture, limited liability
company or other business entity of which a majority of the shares Equity
Interests having ordinary voting power for the election of directors or other
governing body (other than securities or interests having such power only by
reason of the happening of a contingency) are at the time beneficially owned, or
the management of which is otherwise controlled, directly, or indirectly through
one or more

        

        
          
            
            

          

          
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        intermediaries, or both, by such Person. Unless otherwise specified,
all references herein to a "Subsidiary" or to "Subsidiaries" shall refer to a
Subsidiary or Subsidiaries of a Loan Party.

        

        "Super-Majority Required
Lenders" means, as of any date of determination, Lenders holding more
than 66.67% of the Aggregate Commitments or, if the commitment of each Lender to
make Loans and the obligation of the LC Issuer to make LC Credit Extensions have
been terminated pursuant to Section 8.02, Lenders
holding in the aggregate more than 66.67% of the Total Outstandings (with
the aggregate
amount of each Lender’s risk participation and funded participation in LC
Obligations and Swing Line Loans being deemed "held" by such Lender for purposes
of this definition); provided that the Commitment of, and the portion of the
Total Outstandings held or deemed held by, any Defaulting Lender shall be
excluded for purposes of making a determination of Super-Majority Required
Lenders.

        

        "Surveys" has the
meaning specified in the definition of Real Estate Eligibility
Requirements.

        

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

        

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

        

        "Swing Line" means the
revolving credit facility made available by the Swing Line Lender pursuant to
Section
2.04.

        

        "Swing Line Borrowing"
means a borrowing of a Swing Line Loan pursuant to Section
2.04.

        

        "Swing Line Lender"
means Bank of America in its capacity as provider of Swing Line Loans, or any
successor swing line lender hereunder.

        

        "Swing Line Loan" has
the meaning specified in Section
2.04(a).

        

        "Swing Line Loan
Notice" means a notice of a Swing Line Borrowing pursuant to Section 2.04(b), which, if in
writing, shall be substantially in the form of Exhibit
B.

         

        
          
            
            

          

          
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        "Swing
Line Note" means the promissory note of the Borrowers substantially in
the form of Exhibit
C-2, payable to the order of the Swing Line Lender, evidencing the Swing
Line Loans made by the Swing Line
Lender.

        

        "Swing Line Sublimit"
means an amount equal to the lesser of (a) $75,000,000 and (b) the Aggregate
Commitments. The Swing Line Sublimit is part of, and not in addition to, the
Aggregate Commitments.

        

        "Synthetic Lease
Obligation" means the monetary obligation of a Person under (a) a
so-called synthetic, off-balance sheet or tax retention lease, or (b) an
agreement for the use or possession of property (including sale and leaseback
transactions), in each case, creating obligations that do not appear on the
balance sheet of such Person but which, upon the application of any Debtor
Relief Laws to such Person, would be characterized as the indebtedness of such
Person (without regard to accounting treatment).

        

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

        

        "Termination Date"
means the earliest to occur of (i) the Maturity Date, (ii) the date on which the
maturity of the Obligations is accelerated (or deemed accelerated) and the
Commitments are irrevocably terminated (or deemed terminated) in accordance with
Article VIII or
(iii) the termination of the Commitments in accordance with Section 2.06
hereof.

        

        "Title Policy" has the
meaning specified in the definition of Real Estate Eligibility
Requirements.

        

        "Total Outstandings"
means the aggregate Outstanding Amount of all Loans and all LC
Obligations.

        

        "Trading with the Enemy
Act" has the meaning set forth in Section
10.18.

        

        "Trigger Event" means
(a) the occurrence and continuance of an Event of Default, (b) the failure of
the Borrowers to maintain Availability at least equal to the greater of (i)
twenty percent (20.0%) of the Loan Cap or (ii) $135,000,000 and such failure
shall continue for a period of five (5) or more consecutive calendar days or (c)
the failure of the Borrowers maintain at all times Availability at least equal
to seventeen percent (17.0%) of the Loan Cap. The failure under clauses (b) or
(c) hereof is referred to herein as an "Availability
Event".

        

        "Trigger Period" means
the period beginning upon the occurrence of a Trigger Event and ending on (a) if
such Trigger Event arises as a result of an Event of Default, the date such
Event of Default is waived in accordance with this Agreement, or (b) if such
Trigger Event arises as a result of an Availability Event, the date Availability
has equaled or exceeded the greater of (i) twenty percent (20.0%) of the Loan
Cap or (ii) $135,000,000 for a period of forty-five (45) consecutive calendar
days; provided,
however, that
if any Trigger Event shall have occurred and the resulting Trigger Period ended
for any reason
hereunder on three (3) occasions, the Trigger Period for any subsequent (fourth)
Trigger Event shall be unlimited in duration and such Trigger Period shall
continue for the remainder of the term of this Agreement.

        

        "Trigger Period Compliance
Certificate" has the meaning set forth in Section
6.02(a).

        
 

        
          
            
            

          

          
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        "Twelve
Month Period" means any period of twelve (12) consecutive Fiscal Months
taken as one accounting period.

        

        "Type" means, with
respect to a Committed Loan, its character as a Base Rate Loan or a LIBO Rate
Loan.

        

        "UCC" or "Uniform Commercial
Code" means the Uniform Commercial Code as in effect from time to time in
the State of New York; provided, however, that if a term is defined in Article 9
of the Uniform Commercial Code differently than in another Article thereof, the
term shall have the meaning set forth in Article 9; provided further that, if by
reason of mandatory provisions of law, perfection, or the effect of perfection
or non-perfection, of a security interest in any Collateral or the availability
of any remedy hereunder is governed by the Uniform Commercial Code as in effect
in a jurisdiction other than the State of New York, "Uniform Commercial Code"
means the Uniform Commercial Code as in effect in such other jurisdiction for
purposes of the provisions hereof relating to such perfection or effect of
perfection or non-perfection or availability of such remedy, as the case may
be.

        

        "UFCA" has the meaning
specified in Section
10.21(d).

        

        "UFTA" has the meaning
specified in Section
10.21(d).

        

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

        

        "United States" and
"U.S." mean the
United States of America.

        

        "Unreimbursed Amount"
has the meaning specified in Section
2.03(c)(i).

        

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

        

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

        

        
          
            
            

          

          
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        "asset" and "property" shall be
construed to have the same meaning and effect and to refer to any and all
tangible and intangible assets and properties, including cash, securities,
accounts and contract rights and (vii) the word "promptly" when used
with respect to any action or delivery by any Loan Party shall mean as soon as
reasonably possible, but no later than five (5) business days.

        

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

        

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

        

        
          1.03     
 Accounting
Terms

        

        

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

        

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

        

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

        

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

        

        1.06        Letter of
Credit Amounts. Unless otherwise specified, all references herein to
the amount
of a Letter of Credit at any time shall be deemed to be the Stated Amount of
such Letter of Credit in effect at such time; provided, however, that with
respect to any Letter of Credit that, by its terms or by the terms of any Issuer
Documents related thereto, provides for one or more automatic increases in the
Stated Amount thereof, the amount of such Letter of Credit shall be deemed to be
the maximum Stated Amount of such Letter of Credit after giving effect to all
such increases, whether or not such maximum Stated Amount is in effect at such
time.

         

        
          
            
            

          

          
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          1.07        Covenant
Adjustments.

        

        

        (a)           Covenant Acquisition
Adjustments. Except as otherwise expressly provided herein, for
purposes of calculating the financial covenant in Section 7.15 for any
period (or a portion of a period) that includes the date of the consummation of
any Permitted Acquisition, references to “Lead Borrower and its Subsidiaries”
shall include each acquired Person, or lines of business, as applicable, and the
EBITDA (and each other component of such financial covenant) of such acquired
Person or line of business (such EBITDA to be formulated on the basis of the
definition of Consolidated EBITDA set forth herein), as if the Acquisition had
been consummated on the first day of any such period of
measurement.

        

        (b)           Covenant Disposition
Adjustments. Except as otherwise expressly provided herein, for
purposes of calculating the financial covenant in Section 7.15 for any
period (or a portion of a period) that includes the date of any Disposition of a
Subsidiary or line of business, as applicable, Consolidated EBITDA shall be
determined on a historical pro forma basis to exclude the results of operations
of such Subsidiary or line of business, as applicable so disposed.

        

        1.09       Exclusion
of Certain Subsidiaries. In no event shall Chelsea Insurance Company
Ltd. be
required to be a Loan Party.

        

        1.10       Notices
Generally. Unless otherwise expressly provided herein, any notice
required to be
provided by the Loan Parties shall be substantially in the form of notice
attached as Exhibit
O hereto.

        

        ARTICLE
II

        THE
COMMITMENTS AND CREDIT EXTENSIONS

        

        2.01       Committed
Loans; Reserves. (a) Subject to the terms and conditions set forth
herein, each Lender
severally agrees to make loans (each such loan, a "Committed Loan") to
the Borrowers from time to time, on any Business Day during the Availability
Period, in an aggregate outstanding amount not to exceed at any time the lesser
of (x) the amount of such Lender’s Commitment, or (y) such Lender’s Applicable
Percentage of the Borrowing Base, subject in each case to the following
limitations:

        

        (i)   
after giving effect to any Committed Borrowing, the Total Outstandings shall not
exceed the Loan Cap,

        

        (ii)  
after giving effect to any Committed Borrowing, the aggregate Outstanding Amount
of the Committed Loans of any Lender, plus such Lender’s
Applicable Percentage of the Outstanding Amount of all LC Obligations, plus such Lender’s
Applicable Percentage of the Outstanding Amount of all Swing Line Loans shall
not exceed such Lender’s Commitment,

        

        (iii)  
the Outstanding Amount of all LC Obligations shall not at any time exceed the
Letter of Credit Sublimit

        

        Within
the limits of each Lender’s Commitment, and subject to the other terms and
conditions hereof, the Borrowers may borrow under this Section 2.01, prepay
under Section
2.05, and reborrow under this Section 2.01.
Committed Loans may be Base Rate Loans or LIBO Rate Loans, as further
provided herein.

        

        
          
            
            

          

          
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        (b) As of the Closing Date, certain details of the calculation of
the Borrowing Base (including Reserves and certain ineligible Collateral) are
set forth in the form of Borrowing Base Certificate attached hereto as Exhibit
F.

        

        (c) The
Administrative Agent shall (i) have the right, at any time and from time to time
after the Closing Date in its Permitted Discretion to establish, and modify or
eliminate Reserves, and (ii) so long as no Trigger Period shall exist, shall
give the Lead Borrower two (2) Business Days prior written notice before any
such change becomes effective.

        

        2.02       Borrowings,
Conversions and Continuations of Committed Loans.

        

        (a)
Committed Loans (other than Swing Line Loans) shall be either Base Rate Loans or
LIBO Rate Loans as the Lead Borrower may request subject to and in accordance
with this Section 2.02. All Swing Line
Loans shall be only Base Rate Loans. Subject to the other provisions of
this Section
2.02, Committed Borrowings of more than one Type may be incurred at the
same time.

        

        (b) Each
Committed Borrowing shall be made upon the Lead Borrower’s irrevocable (except
as otherwise provided in Section 3.03) notice
to the Administrative Agent, which may be given by telephone. Each such notice
must be received by the Administrative Agent not later than 1:00 p.m. (i) three
(3) Business Days prior to the requested date of any Borrowing of LIBO Rate
Loans, and (ii) on the requested date of any Borrowing of Base Rate Loans. Each
telephonic notice by the Lead Borrower pursuant to this Section 2.02(b) must
be confirmed promptly by delivery to the Administrative Agent of a written
Committed Loan Notice, appropriately completed and signed by a Responsible
Officer of the Lead Borrower. Each Borrowing of LIBO Rate Loans shall be in a
principal amount of $5,000,000.00 or a whole multiple of $1,000,000 in excess
thereof. Except as provided in Sections 2.03(c) and
2.04(c), each
Borrowing of Base Rate Loans shall be in a principal amount of not less than
$500,000 and integral multiples of $100,000 in excess thereof. Each Committed
Loan Notice (whether telephonic or written) shall specify (i) the requested date
of the Borrowing (which shall be a Business Day), (ii) the principal amount of
Committed Loans to be borrowed, (iii) the Type of Committed Loans to be
borrowed, and (iv) if applicable, the duration of the Interest Period with
respect thereto. If the Lead Borrower fails to specify a Type of Committed Loan
in a Committed Loan Notice, then the applicable Committed Loans shall be made as
Base Rate Loans. If the Lead Borrower requests a Borrowing of LIBO Rate Loans in
any such Committed Loan Notice, but fails to specify an Interest Period, it will
be deemed to have specified an Interest Period of one month. Following receipt
of a Committed Loan Notice, the Administrative Agent shall promptly notify each
Lender of the amount of its Applicable Percentage of the applicable Committed
Loans, and each Lender shall make the amount of its Committed Loan available to
the Administrative Agent in immediately available funds at the Administrative
Agent’s Office not later than 3:00 p.m. on the Business Day specified in the
applicable Committed Loan Notice. Upon satisfaction of the applicable conditions
set forth in Section
4.02 (and, if such Borrowing is the initial Credit Extension, Section 4.01), the
Administrative Agent shall use reasonable efforts to make all funds so
received available to
the Borrowers in like funds by no later than 4:00 p.m. on the day of receipt by
the Administrative Agent either by (i) crediting the account of the Lead
Borrower on the books of Bank of America with the amount of such funds or (ii)
wire transfer of such funds, in each case in accordance with instructions
provided to (and reasonably acceptable to) the Administrative Agent by the Lead
Borrower; provided, however, that if, on
the date the Committed Loan Notice with respect to such Borrowing is given by the
Lead Borrower, there are LC Borrowings outstanding, then the proceeds of such
Borrowing, first, shall be
applied to the payment in full of any such LC Borrowings, and second, shall be
made available to
the Borrowers as provided above.

        

        (c) Each
conversion of Committed Loans from one Type to the other and each continuation
of LIBO Rate Loans shall be made upon the Lead Borrower’s irrevocable notice to
the

         

        
          
            
            

          

          
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        Administrative Agent, which may be given by telephone. Each such
notice must be received by the Administrative Agent not later than 1:00 p.m.
three (3) Business Days prior to the requested date of any conversion to or
continuation of LIBO Rate Loans or of any conversion of LIBO Rate Loans to Base
Rate Loans. Each telephonic notice by the Lead Borrower pursuant to this Section 2.02(c) must
be confirmed promptly by delivery to the Administrative Agent of a written
Conversion/Continuation Notice, appropriately completed and signed by a
Responsible Officer of the Lead Borrower. Each conversion to or continuation of
LIBO Rate Loans shall be in a principal amount of $5,000,000 or a whole multiple
of $1,000,000 in excess thereof. Except as provided in Sections 2.03(c) and
2.04(c), each
conversion to or continuation of Base Rate Loans shall be in a principal amount
of not less than $500,000 and integral multiples of $100,000 in excess thereof.
Each Conversion/Continuation Notice (whether telephonic or written) shall
specify (i) whether the Borrowers are requesting a conversion of Committed Loans
from one Type to the other or a continuation of LIBO Rate Loans, (ii) the
requested date of the conversion or continuation, as the case may be (which
shall be a Business Day), (iii) the principal amount of Committed Loans to be
converted or continued, (iv) the Type of Committed Loans to which existing
Committed Loans are to be converted, and (v) if applicable, the duration of the
Interest Period with respect thereto. If the Lead Borrower fails to give a
timely notice of a conversion or continuation in a Conversion/Continuation
Notice, then the applicable Committed Loans shall be converted to Base Rate
Loans. Any such automatic conversion to Base Rate Loans shall be effective as of
the last day of the Interest Period then in effect with respect to the
applicable LIBO Rate Loans. If the Lead Borrower requests a conversion to or
continuation of LIBO Rate Loans in a Conversion/Continuation Notice, but fails
to specify an Interest Period, it will be deemed to have specified an Interest
Period of one month. Notwithstanding anything to the contrary herein, a Swing
Line Loan may not be converted to a LIBO Rate Loan. If no timely notice of a
conversion or continuation in a Conversion/Continuation Notice is provided by
the Lead Borrower, the Administrative Agent shall notify each Lender of the
details of any automatic conversion to Base Rate Loans described in this Section
2.03(c).

        

        (d)        
The Administrative Agent, without the request of the Lead Borrower, may advance
any interest, fee, service charge, Credit Party Expenses, or other payment to
which any Credit Party is entitled from the Loan Parties pursuant hereto or any
other Loan Document and may charge the same to the Loan Account notwithstanding
that an Overadvance may result thereby, provided, that no
such charge shall increase the time that any such Permitted Overadvance may
remain outstanding. The Administrative Agent shall advise the Lead Borrower of
any such advance or charge promptly after the making thereof. Such action on the
part of the Administrative Agent shall not constitute a waiver of the
Administrative Agent’s rights and the Borrowers’ obligations under Sections 2.05(c),
2.05(d) or
2.05(e). Any
amount which is added to the principal balance of the Loan Account as provided
in this Section
2.02(b) shall
bear interest at the interest rate then and thereafter applicable to Base Rate
Loans.

        

        (e)        
Except as otherwise provided herein, a LIBO Rate Loan may be continued or
converted only on the last day of an Interest Period for such LIBO Rate Loan.
During the existence of a Default, no Loans may be requested as, converted to or
continued as LIBO Rate Loans without the Consent of the Required
Lenders.

        

        (f)        
The Administrative Agent shall promptly notify the Lead Borrower and the Lenders
of the interest rate applicable to any Interest Period for LIBO Rate Loans upon
determination of such interest rate. At any time that Base Rate Loans are
outstanding, the Administrative Agent shall notify the Lead Borrower and the
Lenders of any change in Bank of America’s prime rate used in determining the
Base Rate promptly following the public announcement of such
change.

        

        (g)        
After giving effect to all Committed Borrowings, all conversions of Committed
Loans from one Type to the other, and all continuations of Committed Loans as
the same Type, there shall not be more than seven (7) Interest Periods in effect
with respect to Committed Loans.

        

        
          
            
            

          

          
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        (h) The Administrative Agent, the Lenders, the Swing Line Lender and
the LC Issuer shall have no obligation to make any Loan or to provide any Letter
of Credit if an Overadvance would result. The Administrative Agent may, in its
discretion, make Permitted Overadvances without the consent of the Lenders, the
Swing Line Lender and the LC Issuer and each Lender shall be bound thereby;
provided, however, that the
Administrative Agent shall cease making Permitted Overadvances if so directed by
the Required Lenders. Any Permitted Overadvance may constitute a Swing Line
Loan. A Permitted Overadvance is for the account of the Borrowers and shall
constitute a Loan and an Obligation and shall be repaid by the Borrowers in
accordance with the provisions of Section 2.05(e). The
making of any such Permitted Overadvance on any one occasion shall not obligate
the Administrative Agent or any Lender to make or permit any Permitted
Overadvance on any other occasion or to permit such Permitted Overadvances to
remain outstanding. The making by the Administrative Agent of a Permitted
Overadvance shall not modify or abrogate any of the provisions of Section 2.03
regarding the Lenders’ obligations to purchase participations with respect to
Letter of Credits or of Section 2.04
regarding the Lenders’ obligations to purchase participations with respect to
Swing Line Loans. The Administrative Agent shall have no liability for, and no
Loan Party or Credit Party shall have the right to, or shall, bring any claim of
any kind whatsoever against the Administrative Agent with respect to
"inadvertent Overadvances" (i.e. where an Overadvance results from changed
circumstances beyond the control of the Administrative Agent (such as a
reduction in the collateral value)) regardless of the amount of any such
Overadvance(s).

        

        
          2.03     
 Letters
of Credit.

        

        

        
          (a)         
 The Letter of Credit
Commitment.

        

        

        (i)           Subject
to the terms and conditions set forth herein, (A) the LC Issuer agrees, in
reliance upon the agreements of the Lenders set forth in this Section 2.03, (1)
from time to time on any Business Day during the period from the Closing Date
until the Termination Date, to issue Letters of Credit for the account of the
Borrowers, and to amend or extend Letters of Credit previously issued by it, in
accordance with Section 2.03(b)
below, and (2) to honor drawings under the Letters of Credit; and (B) the
Lenders severally agree to participate in Letters of Credit issued for the
account of the Borrowers and any drawings thereunder; provided that after
giving effect to any LC Credit Extension with respect to any Letter of Credit,
(x) the Total Outstandings shall not exceed the lesser of (1) the Aggregate
Commitments and (2) the Borrowing Base, (y) the aggregate Outstanding Amount of
the Committed Loans of any Lender, plus such Lender’s
Applicable Percentage of the Outstanding Amount of all LC Obligations, plus such Lender’s
Applicable Percentage of the Outstanding Amount of all Swing Line Loans shall
not exceed such Lender’s Commitment, and (z) the Outstanding Amount of the LC
Obligations shall not exceed the Letter of Credit Sublimit. Each request by the
Lead Borrower for the issuance or amendment of a Letter of Credit shall be
deemed to be a representation by the Borrowers that the LC Credit Extension so
requested complies with the conditions set forth in the proviso to the preceding
sentence. Within the foregoing limits, and subject to the terms and conditions
hereof, the Borrowers’ ability to obtain Letters of Credit shall be fully
revolving, and accordingly the Borrowers may, during the foregoing period,
obtain Letters of Credit to replace Letters of Credit that have expired or that
have been drawn upon and reimbursed. Any LC Issuer (other than Bank of America
or any of its Affiliates) shall notify the Administrative Agent in writing on
each Business Day of all Letters of Credit issued on the prior Business Day by
such LC Issuer, provided that (A)
until the Administrative Agent advises any such LC Issuer that the provisions of
Section 4.02
are not satisfied, or (B) the aggregate amount of the Letters of Credit issued
in any such week exceeds such amount as shall be agreed by the Administrative
Agent and the LC Issuer, such LC Issuer shall be required to so notify the
Administrative Agent in writing only once each week of the Letters of Credit
issued by such LC Issuer during the immediately preceding week as well as the
daily amounts outstanding for the prior week, such notice to be furnished on
such day of the week as the Administrative Agent and such LC Issuer may agree.
All

         

        
          
            
            

          

          
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        Existing Letters of Credit shall be deemed to have been issued
pursuant hereto, and from and after the Closing Date shall be subject to and
governed by the terms and conditions hereof.

        

        (ii)           The LC Issuer shall not issue any
Letter of Credit, if:

        

        (A)     
subject to Section
2.03(b)(iii), the expiry date of a requested Standby Letter of Credit
would occur more than twelve months after the date of issuance or last
extension, unless the LC Issuer and the Administrative Agent each consent, in
their sole discretion, to a later expiry date; or

        

        (B)     
the expiry date of a requested Commercial Letter of Credit would occur more than
180 days after the date of issuance or last extension, unless the LC Issuer and
the Administrative Agent each consent, in their sole discretion, to a later
expiry date; or

        

        (C)     
the expiry date of any requested Letter of Credit would occur after the fifth
day prior to the Letter of Credit Expiration Date, unless such Letter of Credit
is required to be (and at the applicable time is) Cash Collateralized on or
prior to the thirtieth day prior to the Letter of Credit Expiration
Date.

        

        (iii)           The
LC Issuer shall not issue any Letter of Credit without the prior consent of the
Administrative Agent if:

        

        (A)     
any order, judgment or decree of any Governmental Authority or arbitrator shall
by its terms purport to enjoin or restrain the LC Issuer from issuing such
Letter of Credit, or any Law applicable to the LC Issuer or any request or
directive (whether or not having the force of law) from any Governmental
Authority with jurisdiction over the LC Issuer shall prohibit, or request that
the LC Issuer refrain from, the issuance of letters of credit generally or such
Letter of Credit in particular or shall impose upon the LC Issuer with respect
to such Letter of Credit any restriction, reserve or capital requirement (for
which the LC Issuer is not otherwise compensated hereunder) not in effect on the
Closing Date, or shall impose upon the LC Issuer any unreimbursed loss, cost or
expense which was not applicable on the Closing Date and which the LC Issuer in
good faith deems material to it;

        

        (B) the
issuance of such Letter of Credit would violate one or more policies of the LC
Issuer applicable to letters of credit generally;

        

        (C) such
Letter of Credit is to be denominated in a currency other than Dollars; provided that if the
LC Issuer, in its discretion, issues a Letter of Credit denominated in a
currency other than Dollars, all reimbursements by the Borrowers of the honoring
of any drawing under such Letter of Credit shall be paid in the currency in
which such Letter of Credit was denominated;

        

        (D) such
Letter of Credit contains any provisions for automatic reinstatement of the
Stated Amount after any drawing thereunder; or

        

        (E) a
default of any Lender’s obligations to fund under Section 2.03(c) exists or any
Lender is at such time a Defaulting Lender or Deteriorating Lender hereunder,
unless the LC Issuer has entered into arrangements satisfactory to the LC Issuer
with the Borrowers or such Lender to eliminate the LC Issuer’s risk with respect
to such Lender.

        
 

        
          
            
            

          

          
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        (iv)           The
LC Issuer shall not amend any Letter of Credit if the LC Issuer would not be
permitted at such time to issue such Letter of Credit in its amended form under
the terms hereof or if the beneficiary of such Letter of Credit does not accept
the proposed amendment to such Letter of Credit.

        

        (v)           The
LC Issuer shall act on behalf of the Lenders with respect to any Letters of
Credit issued by it and the documents associated therewith, and the LC Issuer
shall have all of the benefits and immunities (A) provided to the Administrative
Agent in Article
IX with respect to any acts taken or omissions suffered by the LC Issuer
in connection with Letters of Credit issued by it or proposed to be issued by it
and Issuer Documents pertaining to such Letters of Credit as fully as if the
term "Administrative Agent" as used in Article IX included
the LC Issuer with respect to such acts or omissions, and (B) as additionally
provided herein with respect to the LC Issuer.

        

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

        

        (i)           Each
Letter of Credit shall be issued or amended, as the case may be, upon the
request of the Lead Borrower delivered to the LC Issuer by mail or fax (with a
copy to the Administrative Agent) or online, consistent with past practice, in
the form of a Letter of Credit Application, appropriately completed and signed
(if delivered by mail or fax) by a Responsible Officer of the Lead Borrower.
Such Letter of Credit Application must be received by the LC Issuer and the
Administrative Agent not later than 11:00 a.m. at least three (3) Business Days
(or such other date and time as the Administrative Agent and the LC Issuer may
agree in a particular instance in their sole discretion) prior to the proposed
issuance date or date of amendment, as the case may be. In the case of a request
for an initial issuance of a Letter of Credit, such Letter of Credit Application
shall specify in form and detail satisfactory to the LC Issuer: (A) the proposed
issuance date of the requested Letter of Credit (which shall be a Business Day);
(B) the amount thereof; (C) the expiry date thereof; (D) the name and address of
the beneficiary thereof; (E) the documents to be presented by such beneficiary
in case of any drawing thereunder; (F) the full text of any certificate to be
presented by such beneficiary in case of any drawing thereunder; and (G) such
other matters as the LC Issuer may require. In the case of a request for an
amendment of any outstanding Letter of Credit, such Letter of Credit Application
shall specify in form and detail satisfactory to the LC Issuer (A) the Letter of
Credit to be amended; (B) the proposed date of amendment thereof (which shall be
a Business Day); (C) the nature of the proposed amendment; and (D) such other
matters as the LC Issuer may require. Additionally, the Lead Borrower shall
furnish to the LC Issuer and the Administrative Agent such other documents and
information pertaining to such requested Letter of Credit issuance or amendment,
including any Issuer Documents, as the LC Issuer or the Administrative Agent may
require.

        

        (ii)           Promptly
after receipt of any Letter of Credit Application, the LC Issuer will confirm
with the Administrative Agent (by telephone or in writing) that the
Administrative Agent has been notified thereof by the Borrowers. Unless the LC
Issuer has received written notice from any Lender, the Administrative Agent or
any Loan Party, at least one Business Day prior to the requested date of
issuance or amendment of the applicable Letter of Credit, that one or more
applicable conditions contained in Article IV shall not
then be satisfied, then, subject to the terms and conditions hereof, the LC
Issuer shall, on the requested date, issue a Letter of Credit for the account of
the applicable Borrower (or the applicable Subsidiary) or enter into the
applicable amendment, as the case may be, in each case in accordance with the LC
Issuer's usual and customary business practices. Immediately upon the issuance
or amendment of each Letter of Credit, each Lender shall be deemed to (without
any further action), and hereby irrevocably and unconditionally agrees to,
purchase from the LC Issuer, without recourse or warranty, a risk participation
in such Letter of Credit in an amount equal to the product of such Lender’s
Applicable Percentage times the amount of
such Letter of Credit. Upon any change in the Commitments

        

        
          
            
            

          

          
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        under this Agreement, it is hereby agreed that with respect to all
LC Obligations, there shall be an automatic adjustment to the participations
hereby created to reflect the new Applicable Percentages of the assigning and
assignee Lenders.

        

        (iii)           If
the Lead Borrower so requests in any applicable Letter of Credit Application,
the LC Issuer may, in its sole and absolute discretion, agree to issue a Standby
Letter of Credit that has automatic extension provisions (each, an "Auto-Extension Letter of
Credit"); provided that any
such Auto-Extension Letter of Credit must permit the LC Issuer to prevent any
such extension at least once in each twelve-month period (commencing with the
date of issuance of such Standby Letter of Credit) by giving prior notice to the
beneficiary thereof not later than a day (the "Non-Extension Notice
Date") in each
such twelve-month period to be agreed upon at the time such Standby Letter of
Credit is issued. Unless
otherwise directed by the LC Issuer, the Lead Borrower shall not be required to
make a specific request to the LC Issuer for any such extension. Once an
Auto-Extension Letter of Credit has been issued, the Lenders shall be deemed to
have authorized (but may not require) the LC Issuer to permit the extension of
such Standby Letter of Credit at any time to an expiry date not later than
twelve months following the Letter of Credit Expiration Date; provided, however, that the LC
Issuer shall not permit any such extension if (A) the LC Issuer has determined
that it would not be permitted, or would have no obligation, at such time to
issue such Standby Letter of Credit in its revised form (as extended) under the
terms hereof (by reason of the provisions of clauses (ii) or (iii) of Section 2.03(a) or
otherwise), or (B) it has received notice (which may be by telephone or in
writing) on or before the day that is five Business Days before the
Non-Extension Notice Date (1) from the Administrative Agent that the Required
Lenders have elected not to permit such extension or (2) from the Administrative
Agent, any Lender or the Lead Borrower that one or more of the applicable
conditions specified in Section 4.02 is not
then satisfied, and in each such case directing the LC Issuer not to permit such
extension.

        

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

        

        (c)           Drawings
and Reimbursements; Funding of Participations.

        

        (i)           Upon
receipt from the beneficiary of any Letter of Credit of any notice of a drawing
under such Letter of Credit, the LC Issuer shall notify the Lead Borrower and
the Administrative Agent thereof; provided, however, that any
failure to give or delay in giving such notice shall not relieve the Borrowers
of their obligation to reimburse the LC Issuer and the Lenders with respect to
any such payment. Not later than 11:00 a.m. on the Business Day following the
date of any payment by the LC Issuer under a Letter of Credit (each such date,
an "Honor
Date"), the Borrowers shall reimburse the LC Issuer through the
Administrative Agent in an amount equal to the amount of such drawing. If the
Borrowers fail to so reimburse the LC Issuer by such time, the Administrative
Agent shall promptly notify each Lender of the Honor Date, the amount of the
unreimbursed drawing (the "Unreimbursed
Amount"), and the amount of such Lender’s Applicable Percentage thereof.
In such event, the Borrowers shall be deemed to have requested a Committed
Borrowing of Base Rate Loans to be disbursed on the Honor Date in an amount
equal to the Unreimbursed Amount, without regard to the minimum and multiples
specified in Section
2.02 for the principal amount of Base Rate Loans, but subject to the
amount of the unutilized portion of the Aggregate Commitments and the conditions
set forth in Section
4.02 (other than the delivery of a Committed Loan Notice). Any notice
given by the LC Issuer or the Administrative Agent pursuant to this Section 2.03(c)(i)
may be given by telephone if immediately confirmed in writing; provided that the
lack of such an immediate confirmation shall not affect the conclusiveness or
binding effect of such notice.

         

        
          
            
            

          

          
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        (ii)           Each
Lender shall upon any notice pursuant to Section 2.03(c)(i)
make funds available to the Administrative Agent for the account of the LC
Issuer at the Administrative Agent’s Office in an amount in Dollars equal to its
Applicable Percentage of the Dollar equivalent (as determined in good faith by
the applicable LC Issuer) of the Unreimbursed Amount not later than 3:00 p.m. on
the Business Day specified in such notice by the Administrative Agent,
whereupon, subject to the provisions of Section 2.03(c)(iii),
each Lender that so makes funds available shall be deemed to have made a Base
Rate Loan to the Borrowers in such amount. The Administrative Agent shall remit
the funds so received to the LC Issuer.

        

        (iii)           With
respect to any Unreimbursed Amount that is not fully refinanced by a Committed
Borrowing of Base Rate Loans because the conditions set forth in Section 4.02 cannot
be satisfied or for any other reason, the Borrowers shall be deemed to have
incurred from the LC Issuer an LC Borrowing in the amount of the Unreimbursed
Amount that is not so refinanced, which LC Borrowing shall be due and payable on
demand (together with interest) and shall bear interest at the Default Rate. In
such event, each Lender’s payment to the Administrative Agent for the account of
the LC Issuer pursuant to Section 2.03(c)(ii)
shall be deemed payment in respect of its participation in such LC Borrowing and
shall constitute an LC Advance from such Lender in satisfaction of its
participation obligation under this Section
2.03.

        

        (iv)           Until
each Lender funds its Committed Loan or LC Advance pursuant to this Section 2.03(c) to
reimburse the LC Issuer for any amount drawn under any Letter of Credit,
interest in respect of such Lender’s Applicable Percentage of such amount shall
be solely for the account of the LC Issuer.

        

        (v)           Each
Lender’s obligation to make Committed Loans or LC Advances to reimburse the LC
Issuer for amounts drawn under Letters of Credit, as contemplated by this Section 2.03(c), shall be
absolute and unconditional and shall not be affected by any circumstance,
including (A) any setoff,
counterclaim, recoupment, defense or other right which such Lender may have
against the LC Issuer, any Borrower or any other Person for any reason
whatsoever; (B) the occurrence or continuance of a Default, or (C) any other
occurrence, event or condition, whether or not similar to any of the foregoing;
provided, however, that each
Lender’s obligation to make Committed Loans pursuant to this Section 2.03(c) is
subject to the conditions set forth in Section 4.02 (other
than delivery by the Lead Borrower of a Committed
Loan Notice). No such making of an LC Advance shall relieve or otherwise impair
the obligation of the Borrowers to reimburse the LC Issuer for the amount of any
payment made by the LC Issuer under any Letter of Credit, together with interest
as provided herein.

        

        (vi)           If
any Lender fails to make available to the Administrative Agent for the account
of the LC Issuer any amount required to be paid by such Lender pursuant to the
foregoing provisions of this Section 2.03(c) by
the time specified in Section 2.03(c)(ii),
the LC Issuer shall be entitled to recover from such Lender (acting through the
Administrative Agent), on demand, such amount with interest thereon for the
period from the date such payment is required to the date on which such payment
is immediately available to the LC Issuer at a rate per annum equal to the
greater of the Federal Funds Rate and a rate determined by the LC Issuer in
accordance with banking industry rules on interbank compensation plus any
administrative, processing or similar fees customarily charged by the LC Issuer
in connection with the foregoing. If such Lender pays such amount (with interest
and fees as aforesaid), the amount so paid shall constitute such Lender’s
Committed Loan included in the relevant Committed Borrowing or LC Advance in
respect of the relevant LC Borrowing, as the case may be. A certificate of the
LC Issuer submitted to any Lender (through the Administrative Agent) with
respect to any amounts owing under this clause (vi) shall be conclusive absent
manifest error.

         

        
          
            
            

          

          
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        (d)           Repayment
of Participations.

        

        (i)           At
any time after the LC Issuer has made a payment under any Letter of Credit and
has received from any Lender such Lender’s LC Advance in respect of such payment
in accordance with Section 2.03(c), if
the Administrative Agent receives for the account of the LC Issuer any payment
in respect of the related Unreimbursed Amount or interest thereon (whether
directly from the Borrowers or otherwise, including proceeds of Cash Collateral
applied thereto by the Administrative Agent), the Administrative Agent will
distribute to such Lender its Applicable Percentage thereof (appropriately
adjusted, in the case of interest payments, to reflect the period of time during
which such Lender’s LC Advance was outstanding) in the same funds as those
received by the Administrative Agent.

        

        (ii)           If
any payment received by the Administrative Agent for the account of the LC
Issuer pursuant to Section 2.03(c)(i) is
required to be returned under any of the circumstances described in Section 10.05
(including pursuant to any settlement entered into by the LC Issuer in its
discretion), each Lender shall pay to the Administrative Agent for the account
of the LC Issuer its Applicable Percentage thereof on demand of the
Administrative Agent, plus interest thereon from the date of such demand to the
date such amount is returned by such Lender, at a rate per annum equal to the
Federal Funds Rate from time to time in effect. The obligations of the Lenders
under this clause shall survive the payment in full of the Secured Obligations
and the termination of this Agreement.

        

        (e)           Obligations Absolute.
The obligation of the Borrowers to reimburse the LC Issuer for each drawing
under each Letter of Credit and to repay each LC Borrowing shall be absolute,
unconditional and irrevocable, and shall be paid strictly in accordance with the
terms of this Agreement under all circumstances, including the
following:

        

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

        

        (ii)           the
existence of any claim, counterclaim, setoff, defense or other right that the
Borrowers or any Subsidiary may have at any time against any beneficiary or any
transferee of such Letter of Credit (or any Person for whom any such beneficiary
or any such transferee may be acting), the LC Issuer or any other Person,
whether in connection with this Agreement, the transactions contemplated hereby
or by such Letter of Credit or any agreement or instrument relating thereto, or
any unrelated transaction;

        

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

        

        (iv)         any
payment by the LC Issuer under such Letter of Credit against presentation of a
draft or certificate that does not strictly comply with the terms of such Letter
of Credit; or any payment made by the LC Issuer under such Letter of Credit to
any Person purporting to be a trustee in bankruptcy, debtor-in-possession,
assignee for the benefit of creditors, liquidator, receiver or other
representative of or successor to any beneficiary or any transferee of such
Letter of Credit, including any arising in connection with any proceeding under
any Debtor Relief Law;

        

        (v)          any
other circumstance or happening whatsoever, whether or not similar to any of the
foregoing, including any other circumstance that might otherwise constitute a
defense available to, or a discharge of, the Borrowers or any of their
Subsidiaries; or

        

        
          
            
            

          

          
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        (vi)         the fact that any Event of Default
shall have occurred and be continuing.

        

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

        

        (f)           Role of LC Issuer.
Each Lender and the Borrowers agree that, in paying any drawing under a Letter
of Credit, the LC Issuer shall not have any responsibility to obtain any
document (other than any sight draft, certificates and documents expressly
required by the Letter of Credit) or to ascertain or inquire as to the validity
or accuracy of any such document or the authority of the Person executing or
delivering any such document. None of the LC Issuer, the Administrative Agent,
any of their respective Related Parties nor any correspondent, participant or
assignee of the LC Issuer shall be liable to any Lender for (i) any action taken
or omitted in connection herewith at the request or with the approval of the
Lenders or the Required Lenders, as applicable; (ii) any action taken or omitted
in the absence of gross negligence or willful misconduct; (iii) any error,
omission, interruption, loss or delay in transmission or delivery of any draft,
notice or other communication under or relating to any Letter of Credit or any
error in interpretation of technical terms; or (iv) the due execution,
effectiveness, validity or enforceability of any document or instrument related
to any Letter of Credit or Issuer Document. The Borrowers hereby assume all
risks of the acts or omissions of any beneficiary or transferee with respect to
its use of any Letter of Credit; provided, however, that this
assumption is not intended to, and shall not, preclude the Borrowers’ pursuing
such rights and remedies as it may have against the beneficiary or transferee at
law or under any other agreement. None of the LC Issuer, the Administrative
Agent, any of their respective Related Parties nor any correspondent,
participant or assignee of the LC Issuer shall be liable or responsible for any
of the matters described in clauses (i) through (v) of Section 2.03(e);
provided, however, that
anything in such clauses to the contrary notwithstanding, the Borrowers may have a claim
against the LC Issuer, and the LC Issuer may be liable to the Borrowers, to the
extent, but only to the extent, of any direct, as opposed to consequential or
exemplary, damages suffered by the Borrowers which the Borrowers prove were
caused by the LC Issuer's willful misconduct or gross negligence, bad faith or
the LC Issuer's willful failure to pay under any Letter of Credit after the
presentation to it by the beneficiary of a sight draft and certificate(s)
strictly complying with the terms and conditions of a Letter of Credit. In
furtherance and not in limitation of the foregoing, the LC Issuer may accept
documents that appear on their face to be in order, without responsibility for
further investigation, regardless of any notice or information to the contrary
(or the LC Issuer may refuse to accept and make payment upon such documents if
such documents are not in strict compliance with the terms of such Letter of
Credit), and except as expressly stated above, the LC Issuer shall not be
responsible for the validity or sufficiency of any instrument transferring or
assigning or purporting to transfer or assign a Letter of Credit or the rights
or benefits thereunder or proceeds thereof, in whole or in part, which may prove
to be invalid or ineffective for any reason.

        

        
          (g)        
 Cash
Collateral.  Upon the request of the Administrative Agent or
the LC Issuer, (i) if
the LC Issuer has honored any full or partial drawing request under any Letter
of Credit and such drawing has resulted in an LC Borrowing, or (ii) if, as of
the thirtieth day prior to the Letter of Credit Expiration Date, any LC
Obligation for any reason remains outstanding, the Borrowers shall, in each
case, immediately Cash Collateralize the then Outstanding Amount of all LC
Obligations. The Borrowers hereby grant to the Collateral Agent a security
interest in all such Cash Collateral and all proceeds thereof. Cash Collateral
shall be maintained in blocked, non-interest bearing deposit accounts at Bank of
America except that, other than during the continuance of an Event of Default,
Permitted Investments of the type listed in Section 7.02(b) may
be made at the request of the Lead Borrower at the option and in the sole
discretion of the Collateral Agent (and at the Borrowers’ risk and expense) and
interest or profits, if

        

         

        
          
            
            

          

          
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        any, on such investments shall accumulate in such account. If at any
time the Collateral Agent determines that any funds held as Cash Collateral are
subject to any right or claim of any Person other than the Collateral Agent or
that the total amount of such funds is less than the aggregate Outstanding
Amount of all LC Obligations, the Borrowers will, forthwith upon demand by the
Collateral Agent, pay to the Collateral Agent, as additional funds to be
deposited as Cash Collateral, an amount equal to the excess of (x) such
aggregate Outstanding Amount over (y) the total amount of funds, if any, then
held as Cash Collateral that the Collateral Agent determines to be free and
clear of any such right and claim. Upon the drawing of any Letter of Credit for
which funds are on deposit as Cash Collateral, such funds shall be applied, to
the extent permitted under applicable Laws, to reimburse the LC Issuer and, to
the extent not so applied, shall thereafter be applied to satisfy other Secured
Obligations.

        

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

        

        (i)           Letter of Credit
Fees. The Borrowers shall pay to the Administrative Agent for the account
of each Lender in accordance with its Applicable Percentage a Letter of Credit
fee (the "Letter of
Credit Fee") for each Letter of Credit equal to the Applicable Rate for
LIBO Rate Loans times the maximum
daily amount available to be drawn under each such Letter of Credit (whether or
not such maximum amount is then in effect under such Letter of Credit). For
purposes of computing the daily amount available to be drawn under any Letter of
Credit, the amount of the Letter of Credit shall be determined in accordance
with Section
1.06. Letter of Credit Fees shall be (i) due and payable on the first
Business Day after the end of each March, June, September and December,
commencing with the first such date to occur after the issuance of such Letter
of Credit, on the Letter of Credit Expiration Date and thereafter on demand, and
(ii) computed on a quarterly basis in arrears. If there is any change in the
Applicable Rate during any quarter, the daily amount available to be drawn under
each Letter of Credit shall be computed and multiplied by the Applicable Rate
separately for each period during such quarter that such Applicable Rate was in
effect. Notwithstanding anything to the contrary contained herein, while any
Event of Default exists, the Administrative Agent may, and upon the request of
the Required Lenders shall, notify the Lead Borrower that all Letter of Credit
Fees shall accrue at the Default Rate and thereafter such Letter of Credit Fees
shall accrue at the Default Rate to the fullest extent permitted by applicable
Laws.

        

        (j)           Fronting Fee and Documentary
and Processing Charges Payable to LC Issuer. The Borrowers shall pay
directly to the LC Issuer for its own account a fronting fee (i) with respect to
each commercial Letter of Credit, one-eighth of one percent (.125%), computed on
the amount of such Letter of Credit, and payable upon the issuance thereof, and
(ii) with respect to each standby Letter of Credit, one-eighth of one percent
(.125%) per annum, computed on the daily amount available to be drawn under such
Letter of Credit on a quarterly basis in arrears and payable on the first
Business Day after the end of each March, June, September and December in
respect of the most recently-ended quarterly period (or portion thereof, in the
case of the first payment), commencing with the first such date to occur after
the issuance of such Letter of Credit, on the Letter of Credit Expiration Date
and thereafter on demand. For purposes of computing the daily amount available
to be drawn under any Letter of Credit, the amount of the Letter of Credit shall
be determined in accordance with Section 1.06. In
addition, the Borrowers shall pay directly to the LC Issuer for its own account
the customary issuance, presentation, amendment and other processing fees, and
other standard costs and charges, of the LC Issuer relating to letters of credit
as from time to time in effect. Such customary fees and standard costs and
charges are due and payable on demand and are nonrefundable.

         

        
          
            
            

          

          
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        (k)           Conflict with Issuer
Documents. In the event of any conflict between the terms hereof and the
terms of any Issuer Document, the terms hereof shall control.

        

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

        

        2.04     
  Swing
Line Loans.

        

        (a)           The Swing Line.
Subject to the terms and conditions set forth herein, the Swing Line Lender may,
in its discretion and in reliance upon the agreements of the other Lenders set
forth in this Section
2.04, make loans (each such loan, a "Swing Line Loan") to
the Lead Borrower from time to time on any Business Day during the Availability
Period in an aggregate amount not to exceed at any time outstanding the amount
of the Swing Line Sublimit, notwithstanding the fact that such Swing Line Loans,
when aggregated with the Applicable Percentage of the Outstanding Amount of
Committed Loans and LC Obligations of the Lender acting as Swing Line Lender,
may exceed the amount of such Lender’s Commitment; provided, however, that after
giving effect to any Swing Line Loan, (i) the Total Outstandings shall not
exceed the Loan Cap and (ii) the aggregate Outstanding Amount of the Committed
Loans of any Lender at such time, plus such Lender’s
Applicable Percentage of the Outstanding Amount of all LC Obligations at such
time, plus such
Lender’s Applicable Percentage of the Outstanding Amount of all Swing Line Loans
at such time shall not exceed such Lender’s Commitment, and provided, further, that the
Borrowers shall not use the proceeds of any Swing Line Loan to refinance any
outstanding Swing Line Loan. Within the foregoing limits, and subject to the
other terms and conditions hereof, the Borrowers may borrow under this Section 2.04, prepay
under Section
2.05, and reborrow under this Section 2.04. Each
Swing Line Loan shall bear interest only at a rate based on the Base Rate. Immediately
upon the making of a Swing Line Loan, each Lender shall be deemed to, and hereby
irrevocably and unconditionally agrees to, purchase from the Swing Line Lender a
risk participation in such Swing Line Loan in an amount equal to the product of
such Lender’s Applicable Percentage times the amount of
such Swing Line Loan.

        

        (b)           Borrowing Procedures.
Each Swing Line Borrowing shall be made upon the Lead Borrower’s irrevocable
notice to the Swing Line Lender and the Administrative Agent, which may be given
by telephone. Each such notice must be received by the Swing Line Lender and the
Administrative Agent not later than 1:00 p.m. on the requested borrowing date,
and shall specify (i) the amount to be borrowed, which shall be a minimum of
$100,000, and (ii) the requested borrowing date, which shall be a Business Day.
Each such telephonic notice must be confirmed promptly by delivery to the Swing
Line Lender and the Administrative Agent of a written Swing Line Loan Notice,
appropriately completed and signed by a Responsible Officer of the Lead
Borrower. Promptly after receipt by the Swing Line Lender of any telephonic
Swing Line Loan Notice, the Swing Line Lender will confirm with the
Administrative Agent (by telephone or in writing) that the Administrative Agent
has also received such Swing Line Loan Notice and, if not, the Swing Line Lender
will notify the Administrative Agent (by telephone or in writing) of the
contents thereof. Unless the Swing Line Lender has received notice (by telephone
or in writing) from the Administrative Agent at the request of the Required
Lenders prior to 2:00 p.m. on the date of the proposed Swing Line Borrowing (A)
directing the Swing Line Lender not to make such Swing Line Loan as a result of
the limitations set forth in the proviso to the first sentence of Section 2.04(a), or
(B) that one or more of the applicable conditions specified in Article IV is not
then satisfied,
then, subject to the terms and conditions hereof, the Swing Line Lender may in
its discretion, not later than 3:00 p.m. on the borrowing date specified in such
Swing Line Loan Notice, make the

        

        
          
            
            

          

          
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        amount of its Swing Line Loan available to the Lead Borrower at its
office either by (i) crediting the account of the Lead Borrower on the books of
the Swing Line Lender in immediately available funds or (ii) wire transfer of
such funds, in either case in accordance with instructions provided by the Lead
Borrower to (and reasonably acceptable to) the Swing Line
Lender.

        

        (c)           Refinancing
of Swing Line Loans.

        

        (i)           Subject
to the provisions of Section 2.14, the
Swing Line Lender at any time in its sole and absolute discretion may request,
on behalf of the Borrowers (which hereby irrevocably authorize the Swing Line
Lender to so request on their behalf), that each Lender make a Base Rate Loan in
an amount equal to such Lender's Applicable Percentage of the amount of Swing
Line Loans then outstanding. Such request shall be made in writing (which
written request shall be deemed to be a Committed Loan Notice for purposes
hereof) and in accordance with the requirements of Section 2.02, without
regard to the minimum and multiples specified therein for the principal amount
of Base Rate Loans, but subject to the unutilized portion of the Aggregate
Commitments and the conditions set forth in Section 4.02. The
Swing Line Lender shall furnish the Lead Borrower with a copy of the
applicable Committed Loan
Notice promptly after delivering such notice to the Administrative Agent. Each
Lender shall make an amount equal to its Applicable Percentage of the amount
specified in such Committed Loan Notice available to the Administrative Agent in
immediately available funds for the account of the Swing Line Lender at the
Administrative Agent’s Office not later than 3:00 p.m. on the day specified in
such Committed Loan Notice, whereupon, subject to Section 2.04(c)(ii),
each Lender that so makes funds available shall be deemed to have made a Base
Rate Loan to the Borrowers in such amount. The Administrative Agent shall remit
the funds so received to the Swing Line Lender.

        

        (ii)           If
for any reason any Swing Line Loan cannot be refinanced by such a Committed
Borrowing in accordance with Section 2.04(c)(i),
the request for Base Rate Loans submitted by the Swing Line Lender as set forth
herein shall be deemed to be a request by the Swing Line Lender that each of the
Lenders fund its risk participation in the relevant Swing Line Loan and each
Lender’s payment to the Administrative Agent for the account of the Swing Line
Lender pursuant to Section 2.04(c)(i) shall be
deemed payment in respect of such participation.

        

        (iii)           If
any Lender fails to make available to the Administrative Agent for the account
of the Swing Line Lender any amount required to be paid by such Lender pursuant
to the foregoing provisions of this Section 2.04(c) by
the time specified in Section 2.04(c)(i),
the Swing Line Lender shall be entitled to recover from such Lender (acting
through the Administrative Agent), on demand, such amount with interest thereon
for the period from the date such payment is required to the date on which such
payment is immediately available to the Swing Line Lender at a rate per annum
equal to the greater of the Federal Funds Rate and a rate determined by the
Swing Line Lender in accordance with banking industry rules on interbank
compensation plus any administrative, processing or similar fees customarily
charged by the Swing Line Lender in connection with the foregoing. If such
Lender pays such amount (with interest and fees as aforesaid), the amount so
paid shall constitute such Lender’s Committed Loan included in the relevant
Committed Borrowing or funded participation in the relevant Swing Line Loan, as
the case may be. A certificate of the Swing Line Lender submitted to any Lender
(through the Administrative Agent) with respect to any amounts owing under this
clause (iii) shall be conclusive absent manifest error.

        

        (iv)           Each
Lender’s obligation to make Committed Loans or to purchase and fund risk
participations in Swing Line Loans pursuant to this Section 2.04(c) shall
be absolute and unconditional and shall not be affected by any circumstance,
including (A) any setoff, counterclaim, recoupment, defense or other right which
such Lender may have against the Swing Line Lender, the Borrowers or any other
Person for any reason whatsoever, (B) the occurrence or continuance of a
Default

        
          
            
            

          

          
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        or an Event of Default, or (C) any other occurrence, event or
condition, whether or not similar to any of the foregoing; provided, however, that each
Lender’s obligation to make Committed Loans pursuant to this Section 2.04(c) is
subject to the conditions set forth in Section 4.02. No such
funding of risk participations shall relieve or otherwise impair the obligation
of the Borrowers to repay Swing Line Loans, together with interest as provided
herein.

        

        (d)           Repayment
of Participations.

        

        (i)           At
any time after any Lender has purchased and funded a risk participation in a
Swing Line Loan, if the Swing Line Lender receives any payment on account of
such Swing Line Loan, the Swing Line Lender will distribute to such Lender its
Applicable Percentage of such payment (appropriately adjusted, in the case of
interest payments, to reflect the period of time during which such Lender’s risk
participation was funded) in the same funds as those received by the Swing Line
Lender.

        

        (ii)           If
any payment received by the Swing Line Lender in respect of principal or
interest on any Swing Line Loan is required to be returned by the Swing Line
Lender under any of the circumstances described in Section 10.05
(including pursuant to any settlement entered into by the Swing Line Lender in
its discretion), each Lender shall pay to the Swing Line Lender its Applicable
Percentage thereof on demand of the Administrative Agent, plus interest thereon
from the date of such demand to the date such amount is returned, at a rate per
annum equal to the Federal Funds Rate. The Administrative Agent will make such
demand upon the request of the Swing Line Lender. The obligations of the Lenders
under this clause shall survive the payment in full of the Secured Obligations
and the termination of this Agreement.

        

        (e)           Interest for Account of
Swing Line Lender. The Swing Line Lender shall be responsible for
invoicing the Borrowers for interest on the Swing Line Loans. Until each Lender
funds its Base Rate Loan or risk participation pursuant to this Section 2.04 to
refinance such Lender’s Applicable Percentage of any Swing Line Loan, interest
in respect of such Applicable Percentage shall be solely for the account of the
Swing Line Lender.

        

        (f)           Payments Directly to Swing
Line Lender. The Borrowers shall make all payments of principal and
interest in respect of the Swing Line Loans directly to the Swing Line
Lender.

        

        2.05        Prepayments.

        

        (a)           The
Borrowers may, upon irrevocable notice from the Lead Borrower to the
Administrative Agent, at any time or from time to time voluntarily prepay
Committed Loans in whole or in part without premium or penalty; provided that (i)
such notice must be received by the Administrative Agent not later than 11:00
a.m. (A) three (3) Business Days prior to any date of prepayment of LIBO Rate
Loans and (B) on the date of prepayment of Base Rate Loans; (ii) any prepayment
of LIBO Rate Loans shall be in a principal amount of $1,000,000 or a whole
multiple of $1,000,000 in excess thereof; and (iii) any prepayment of Base Rate
Loans shall be in a principal amount of $500,000 or a whole multiple of $100,000
in excess thereof or, in each case, if less, the entire principal amount thereof
then outstanding. Each such notice shall specify the date and amount of such
prepayment and the Type(s) of Loans to be prepaid and, if LIBO Rate Loans, the
Interest Period(s) of such Loans. The Administrative Agent will promptly notify
each Lender of its receipt of each such notice, and of the amount of such
Lender’s Applicable Percentage of such prepayment. If such notice is given by
the Lead Borrower, the Borrowers shall make such prepayment and the payment
amount specified in such notice shall be due and payable on the date specified
therein. Any prepayment of a LIBO Rate Loan shall be accompanied by all accrued
interest on the amount prepaid, together with any additional amounts required
pursuant to Section
3.05.

         

        
          
            
            

          

          
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        Each such prepayment shall be applied to the Committed Loans of the
Lenders in accordance with their respective Applicable
Percentages.

        

        (b)           The
Borrowers may, upon irrevocable notice from the Lead Borrower to the Swing Line
Lender (with a copy to the Administrative Agent), at any time or from time to
time, voluntarily prepay Swing Line Loans in whole or in part without premium or
penalty; provided that (i)
such notice must be received by the Swing Line Lender and the Administrative
Agent not later than 1:00 p.m. on the date of the prepayment, and (ii) any such
prepayment shall be in a minimum principal amount of $100,000. Each such notice
shall specify the date and amount of such prepayment. If such notice is given by
the Lead Borrower, the Borrowers shall make such prepayment and the payment
amount specified in such notice shall be due and payable on the date specified
therein.

        

        (c)           If
for any reason the Total Outstandings at any time exceed the Loan Cap, the
Borrowers shall immediately prepay Loans, Swing Line Loans and LC Borrowings
and/or Cash Collateralize the LC Obligations (other than LC Borrowings) in an
aggregate amount equal to such excess; provided, however, that the
Borrowers shall not be required to Cash Collateralize the LC Obligations
pursuant to this Section 2.05(c)
unless after the prepayment in full of the Loans the Total Outstandings exceed
the Loan Cap.

        

        (d)           During
a Trigger Period, the Borrowers shall prepay the Loans in accordance with the
provisions of Section
6.13 and, if an Event of Default shall have occurred and be continuing,
Cash Collateralize the LC Obligations in accordance with the provisions of Section
2.03(g).

        

        (e)           The
Borrowers shall prepay the Loans and, if an Event of Default shall have occurred
and be continuing, Cash Collateralize the LC Obligations in an amount equal to
the Net Proceeds received by a Loan Party on account of a Prepayment Event. The
application of such amount to the prepayment of Loans and Cash Collateralization
of the LC Obligations shall not reduce the Commitments.

        

        (f)           Prepayments
made pursuant to this Section 2.05, first, shall be
applied ratably to the LC Borrowings and the Swing Line Loans, second, shall be
applied ratably to the outstanding Committed Loans that are Base Rate Loans,
third, shall be
applied ratably to the outstanding Committed Loans that are LIBO Rate Loans,
fourth, if an
Event of Default shall have occurred and be continuing, shall be used to Cash
Collateralize the remaining LC Obligations; and, fifth, the amount
remaining, if any, after the prepayment in full of all LC Borrowings, Swing Line
Loans and Committed Loans outstanding at such time and the Cash
Collateralization of the remaining LC Obligations in full may be retained by the
Borrowers for use in the ordinary course of its business. Upon the drawing of
any Letter of Credit that has been Cash Collateralized, the funds held as Cash
Collateral shall be applied (without any further action by or notice to or from
the Borrowers or any other Loan Party) to reimburse the LC Issuer or the
Lenders, as applicable.

        

        
          2.06        Termination
or Reduction of Commitments.

        

        

        (a)           The
Borrowers may, upon irrevocable notice from the Lead Borrower to the
Administrative Agent, terminate the Aggregate Commitments, the Letter of Credit
Sublimit or the Swing Line Sublimit or from time to time permanently reduce the
Aggregate Commitments, the Letter of Credit Sublimit or the Swing Line Sublimit;
provided that
(i) any such notice shall be received by the Administrative Agent not later than
11:00 a.m. three (3) Business Days prior to the date of termination or
reduction, (ii) any such partial reduction shall be in an aggregate amount of
$5,000,000 or any whole multiple of $1,000,000 in excess thereof, (iii) the
Borrowers shall not terminate or reduce (A) the Aggregate Commitments if, after
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        any concurrent prepayments hereunder, the Total Outstandings would
exceed the Aggregate Commitments, (B) the Letter of Credit Sublimit if, after
giving effect thereto, the Outstanding Amount of LC Obligations not fully Cash
Collateralized hereunder would exceed the Letter of Credit Sublimit, and (C) the
Swing Line Sublimit if, after giving effect thereto, and to any concurrent
payments hereunder, the Outstanding Amount of Swing Line Loans hereunder would
exceed the Swing Line Sublimit.

        

        (b)           If,
after giving effect to any reduction of the Aggregate Commitments, the Letter of
Credit Sublimit or the Swing Line Sublimit exceeds the amount of the Aggregate
Commitments, such Letter of Credit Sublimit or Swing Line Sublimit shall be
automatically reduced by the amount of such excess.

        

        (c)           The
Administrative Agent will promptly notify the Lenders of any termination or
reduction of the Letter of Credit Sublimit, Swing Line Sublimit or the Aggregate
Commitments under this Section 2.06. Upon
any reduction of the Aggregate Commitments, the Commitment of each Lender shall
be reduced by such Lender’s Applicable Percentage of such reduction amount. All
fees (including, without limitation, commitment fees and Letter of Credit Fees)
and interest in respect of the Aggregate Commitments accrued until the effective
date of any termination of the Aggregate Commitments shall be paid on the
effective date of such termination.

        

        2.07       Repayment
of Loans. On the Termination Date, the Borrowers shall cause all
Secured Obligations
to be Fully Satisfied.

        

        
          2.08       Interest.

        

        

        (a)           Subject
to the provisions of Section 2.08(b)
below, (i) each LIBO Rate Loan shall bear interest on the outstanding principal
amount thereof for each Interest Period at a rate per annum equal to the
Adjusted LIBO Rate for such Interest Period plus the Applicable
Margin; (ii) each Base Rate Loan shall bear interest on the outstanding
principal amount thereof from the applicable borrowing date at a rate per annum
equal to the Base Rate plus the Applicable
Margin; and (iii) each Swing Line Loan shall bear interest on the outstanding
principal amount thereof from the applicable borrowing date at a rate per annum
equal to the Base Rate plus the Applicable
Margin.

        

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

        

        (ii)     
If any other Event of Default exists, then the Administrative Agent may, and
upon the request of the Required Lenders shall, notify the Lead Borrower that
all outstanding Obligations shall thereafter bear interest at a fluctuating
interest rate per annum at all times equal to the Default Rate and thereafter
such Obligations shall bear interest at the Default Rate to the fullest extent
permitted by applicable Laws.

        

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

        

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

        

        
          
            
            

          

          
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        2.09        Fees.  In
addition to certain fees described in subsections (i) and (j) of Section
2.03:

        

        (a)           Commitment Fee. The
Borrowers shall pay to the Administrative Agent for the account of each Lender,
in accordance with its Applicable Percentage, a commitment fee, payable
quarterly in arrears on the first Business Day of each Fiscal Quarter,
commencing with the first such date to occur after the Closing Date, and on the
last day of the Availability Period equal to the Applicable Commitment Fee
Percentage times the average
daily amount by which the Aggregate Commitments exceeded the Average Usage, in
each case calculated on a per annum basis for the actual number of days elapsed
in the Fiscal Quarter ending on the day immediately preceding the related
payment date (or, if applicable, the actual number of days in the Fiscal Quarter
to and including last day of the Availability Period). The commitment fee shall
accrue at all times during the Availability Period, including at any time during
which one or more of the conditions in Article IV is not
met.

        

        (b)           Other Fees. The
Borrowers shall pay to the Joint Lead Arrangers and the Administrative Agent for
their own respective accounts fees in the amounts and at the times specified in
the Fee Letter. Such fees shall be fully earned when paid and shall not be
refundable for any reason whatsoever.

        

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

        

        
          2.11       Evidence
of Debt.

        

        

        (a)           The
Credit Extensions made by each Lender shall be evidenced by one or more accounts
or records maintained by the Administrative Agent (the "Loan Account") in the
ordinary course of business. In addition, each Lender may record in such
Lender’s internal records, an appropriate notation evidencing the date and
amount of each Loan from such Lender, each payment and prepayment of principal
of any such Loan, and each payment of interest, fees and other amounts due in
connection with the Obligations due to such Lender. The accounts or records
maintained by the Administrative Agent and each Lender shall be conclusive
absent manifest error of the amount of the Credit Extensions made by the Lenders
to the Borrowers and the interest and payments thereon. Any failure to so record
or any error in doing so shall not, however, limit or otherwise affect the
obligation of the Borrowers hereunder to pay any amount owing with respect to
the Obligations. In the event of any conflict between the accounts and records
maintained by any Lender and the accounts and records of the Administrative
Agent in respect of such matters, the accounts and records of the Administrative
Agent shall control in the absence of manifest error. Upon the request of any
Lender made through the Administrative Agent, the Borrowers shall execute and
deliver to such Lender (through the Administrative Agent) a Note, which shall
evidence such Lender’s Loans in addition to such accounts or records. Each
Lender may attach schedules to its Note and endorse thereon the date, Type (if
applicable), amount and maturity of its Loans and payments with respect thereto.
Any failure to so attach or endorse, or any error in doing so, shall not,
however, limit or otherwise affect the obligation of the Borrowers hereunder to
pay any amount owing with respect to the Obligations. Upon receipt of an
affidavit of a Lender as to the loss, theft, destruction or mutilation of such
Lender’s Note with appropriate indemnification provisions in form and
substance

         

        
          
            
            

          

          
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        reasonably satisfactory to the Borrowers and upon cancellation of
such Note, the Borrowers will issue, in lieu thereof, a replacement Note in
favor of such Lender, in the same principal amount thereof and otherwise of like
tenor.

        

        (b)           In
addition to the accounts and records referred to in Section 2.11(a), each
Lender and the Administrative Agent shall maintain in accordance with its usual
practice accounts or records evidencing the purchases and sales by such Lender
of participations in Letters of Credit and Swing Line Loans. In the event of any
conflict between the accounts and records maintained by the Administrative Agent
and the accounts and records of any Lender in respect of such matters, the
accounts and records of the Administrative Agent shall control in the absence of
manifest error.

        

        2.12        Payments
Generally; Administrative Agent’s Clawback.

        

        (a)           General. All payments
to be made by the Borrowers shall be made without condition or deduction for any
counterclaim, defense, recoupment or setoff. Except as otherwise expressly
provided herein, all payments by the Borrowers hereunder shall be made to the
Administrative Agent, for the account of the respective Lenders to which such
payment is owed, at the Administrative Agent’s Office in Dollars and in
immediately available funds not later than 2:00 p.m. on the date specified
herein. The Administrative Agent will promptly distribute to each Lender its
Applicable Percentage (or other applicable share as provided herein) of such
payment in like funds as received by wire transfer to such Lender’s Lending
Office. All payments received by the Administrative Agent after 2:00 p.m. shall,
at the option of the Administrative Agent, be deemed received on the next
succeeding Business Day and any applicable interest or fee shall continue to
accrue. If any payment to be made by the Borrowers shall come due on a day other
than a Business Day, payment shall be made on the next following Business Day,
and such extension of time shall be reflected in computing interest or fees, as
the case may be.

        

        (b)           Funding by Lenders;
Presumption by Administrative Agent. (i) Unless the Administrative Agent
shall have received notice from a Lender prior to the proposed date of any
Borrowing of LIBO Rate Loans (or in the case of any Borrowing of Base Rate
Loans, prior to 2:00 p.m. on the date of such Borrowing) that such Lender will
not make available to the Administrative Agent such Lender’s share of such
Borrowing, the Administrative Agent may assume that such Lender has made such
share available on such date in accordance with Section 2.02 (or in
the case of a Borrowing of Base Rate Loans, that such Lender has made such share
available in accordance with and at the time required by Section 2.02) and
may, in reliance upon such assumption, make available to the Borrowers a corresponding
amount. In such event, if a Lender has not in fact made its share of the
applicable Committed Borrowing available to the Administrative Agent, then the
applicable Lender and the Borrowers severally agree to pay to the Administrative
Agent forthwith on demand such corresponding amount in immediately available
funds with interest thereon, for each day from and including the date such
amount is made available to the Borrowers to but excluding the date of payment
to the Administrative Agent, at (A) in the case of a payment to be made by such
Lender, the greater of the Federal Funds Rate and a rate determined by the
Administrative Agent in accordance with banking industry rules on interbank
compensation plus any administrative processing or similar fees customarily
charged by the Administrative Agent in connection with the foregoing, and (B) in
the case of a payment to be made by the Borrowers, the interest rate applicable
to Base Rate Loans. If the Borrowers and such Lender shall pay such interest to
the Administrative Agent for the same or an overlapping period, the
Administrative Agent shall promptly remit to the Borrowers the amount of such
interest paid by the Borrowers for such period. If such Lender pays its share of
the applicable Committed Borrowing to the Administrative Agent, then the amount
so paid shall constitute such Lender’s Committed Loan included in such Committed
Borrowing. Any payment by the Borrowers shall be without prejudice to any
claim

         

        
          
            
            

          

          
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        the Borrowers may have against a Lender that shall have failed to
make such payment to the Administrative Agent.

        

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

        

        A notice
of the Administrative Agent to any Lender or the Lead Borrower with respect to
any amount owing under this subsection (b) shall be conclusive, absent manifest
error.

        

        (c)           Failure to Satisfy
Conditions Precedent. If any Lender makes available to the Administrative
Agent funds for any Loan to be made by such Lender as provided in the foregoing
provisions of this Article II, and such
funds are not made available to the Borrowers by the Administrative Agent
because the conditions to the applicable Credit Extension set forth in Article IV are not
satisfied or waived in accordance with the terms hereof (subject to the
provisions of the last paragraph of Section 4.02 hereof),
the Administrative Agent promptly shall return such funds (in like funds as
received from such Lender) to such Lender, without interest.

        

        (d)           Obligations of Lenders
Several. The obligations of the Lenders hereunder to make Committed
Loans, to fund participations in Letters of Credit and Swing Line Loans and to
make payments pursuant to Section 10.04(c) are
several and not joint. The failure of any Lender to make any Committed Loan, to
fund any such participation or to make any payment under Section 10.04(c) on
any date required hereunder shall not relieve any other Lender of its
corresponding obligation to do so on such date, and no Lender shall be
responsible for the failure of any other Lender to so make its Committed Loan,
to purchase its participation or to make its payment under Section
10.04(c).

        

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

        

        2.13        Sharing
of Payments by Lenders. If any Lender shall, by exercising any right of
setoff or
counterclaim or otherwise, obtain payment in respect of any principal of,
interest on, or other amounts with respect to, any of the Obligations resulting
in such Lender’s receiving payment of a proportion of the aggregate amount of
such Obligations greater than its pro rata share
thereof as provided herein (including in contravention of the priorities of
payment set forth in Section 8.03), then
the Lender receiving such greater proportion shall (a) notify the Administrative
Agent of such fact, and (b) purchase (for cash at face value) participations in
the Obligations of the other Lenders, or make such other adjustments as shall be
equitable, so that the benefit of all such payments shall be shared by the
Lenders ratably and in the priorities set forth in Section 8.03, provided
that:

        

        (i)          
 if any such participations or subparticipations are purchased and all or
any portion of the payment giving rise thereto is recovered, such participations
or subparticipations

        

        
          
            
            

          

          
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        shall be rescinded and the purchase price restored to the extent of
such recovery, without interest; and

        

        (ii) the
provisions of this Section 2.13 shall
not be construed to apply to (x) any payment made by the Loan Parties pursuant
to and in accordance with the express terms of this Agreement or (y) any payment
obtained by a Lender as consideration for the assignment of or sale of a
participation in any of its Committed Loans or subparticipations in LC
Obligations or Swing Line Loans to any assignee or participant, other than to
the Borrowers or any Subsidiary thereof (as to which the provisions of this
Section 2.13
shall apply).

        

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

        

        
          2.14      
 Settlement
Among Lenders.

        

        

        (a)           The
amount of each Lender’s Applicable Percentage of outstanding Loans (including
outstanding Swing Line Loans, shall be computed weekly (or more frequently in
the Administrative Agent’s discretion) and shall be adjusted upward or downward
based on all Loans (including Swing Line Loans) and repayments of Loans
(including Swing Line Loans) received by the Administrative Agent as of 3:00
p.m. on the first Business Day (such date, the "Settlement Date") following the
end of the period specified by the Administrative Agent.

        

        (b)           The
Administrative Agent shall deliver to each of the Lenders promptly after a
Settlement Date a summary statement of the amount of outstanding Committed Loans
for the period and the amount of repayments received for the period. As
reflected on the summary statement, (i) the Administrative Agent shall transfer
to each Lender its Applicable Percentage of repayments, and (ii) each Lender
shall transfer to the Administrative Agent (as provided below) or the
Administrative Agent shall transfer to each Lender, such amounts as are
necessary to insure that, after giving effect to all such transfers, the amount
of Committed Loans made by each Lender shall be equal to such Lender’s
Applicable Percentage of all Committed Loans outstanding as of such Settlement
Date. If the summary statement requires transfers to be made to the
Administrative Agent by the Lenders and is received prior to 1:00 p.m. on a
Business Day, such transfers shall be made in immediately available funds no
later than 3:00 p.m. that day; and, if received after 1:00 p.m., then no later
than 3:00 p.m. on the next Business Day. The obligation of each Lender to
transfer such funds is irrevocable, unconditional and without recourse to or
warranty by the Administrative Agent. If and to the extent any Lender shall not
have so made its transfer to the Administrative Agent, such Lender agrees to pay
to the Administrative Agent, forthwith on demand such amount, together with
interest thereon, for each day from such date until the date such amount is paid
to the Administrative Agent, equal to the greater of the Federal Funds Rate and
a rate determined by the Administrative Agent in accordance with banking
industry rules on interbank compensation plus any administrative, processing, or
similar fees customarily charged by the Administrative Agent in connection with
the foregoing.

        

        
          2.15        Increase
in Commitments.

        

        

        (a)           Request for Increase.
Provided no Event of Default then exists and no Default would arise
therefrom, at any time and from time to time after the date that occurs ninety
(90) days after the Closing Date, upon notice to the Administrative Agent (which
shall promptly notify the Lenders), the Lead Borrower may request an increase in
the Aggregate Commitments by an amount (for all such

        

        
          
            
            

          

          
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        requests) not exceeding $300,000,000 in the aggregate; provided that (i) any
such request for an increase shall be in a minimum amount of $50,000,000, and
(ii) the Lead Borrower may make a maximum of six (6) such requests. At the time
of sending such notice, the Lead Borrower (in consultation with the
Administrative Agent) shall specify the time period within which each Lender is
requested to respond (which shall in no event be less than ten Business Days
from the date of delivery of such notice to the Lenders).

        

        (b)           Lender Elections to
Increase. Each Lender shall notify the Administrative Agent within such
time period whether or not it agrees to increase its Commitment and, if so (each
an "Increased
Commitment
Lender"), whether by an amount equal to, greater than, or less than its
Applicable Percentage of
such requested increase. Any Lender not responding within such time period shall
be deemed to have declined to increase its Commitment.

        

        (c)           Notification by
Administrative Agent; Additional Lenders. The Administrative Agent shall
notify the Lead Borrower and each Lender of the Lenders’ responses to each
request made in this Section 2.15. To
achieve the full amount of a requested increase and subject to the approval of
the Administrative Agent, the LC Issuer and the Swing Line Lender (which
approvals shall not be unreasonably withheld), to the extent that the existing
Lenders decline to increase their Commitments, or decline to increase their
Commitments to the amount requested by the Lead Borrower, the Administrative
Agent or its Affiliates, in consultation with the Lead Borrower, will use its
reasonable efforts to arrange for other Eligible Assignees to become a Lender
hereunder and to issue commitments in an amount equal to the amount of the
increase in the Aggregate Commitments requested by the Lead Borrower and not
accepted by the existing Lenders (and the Lead Borrower may also invite
additional Eligible Assignees to become Lenders) (each such Eligible Assignee
issuing a commitment and becoming a Lender, an "Additional Commitment
Lender"), provided, however, that without
the consent of the Administrative Agent, at no time shall the Commitment of any
Additional Commitment Lender be less than $10,000,000.

        

        (d)           Effective Date and
Allocations. If the Aggregate Commitments are increased in accordance
with this Section
2.15, the Administrative Agent and the Lead Borrower shall determine the
effective date (the "Increase Effective
Date") of such increase (such increase, a "Commitment
Increase"). The Administrative Agent shall promptly notify the Lead
Borrower and the Lenders of the final allocation of such Commitment Increase and
the Increase Effective Date and on the Effective Date (i) the Aggregate
Commitments under, and for all purposes of, this Agreement shall be increased by
the aggregate amount of such Commitment Increases, and (ii) Schedule 2.01 shall
be deemed modified, without further action, to reflect the revised Commitments
and Applicable Percentages of the Lenders.

        

        (e)           Conditions to Effectiveness
of Increase. As a condition precedent to such increase, (i) the Lead
Borrower shall deliver to the Administrative Agent a certificate of each Loan
Party dated as of the Increase Effective Date (in sufficient copies for each
Lender) signed by a Responsible Officer of such Loan Party (A) certifying and
attaching the resolutions, if necessary, adopted by such Loan Party approving or
consenting to such Commitment Increase, and (B) in the case of the Borrowers,
certifying that, before and after giving effect to such Commitment Increase, (1)
the representations and warranties contained in Article V and the
other Loan Documents are true and correct on and as of the Increase Effective
Date, except to the extent that such representations and warranties specifically
refer to an earlier date, in which case they are true and correct as of such
earlier date, and except that for purposes of this Section 2.15, the
representations and warranties contained in subsections (a) and (b) of Section 5.05 shall be deemed
to refer to the most recent statements furnished pursuant to clauses (a) and
(b), respectively,
of Section
6.01, (ii) the Borrowers, the Administrative Agent, and any Additional
Commitment Lender shall have executed and delivered a joinder to the Loan
Documents in such form as the Administrative Agent shall reasonably require;
(iii) the Borrowers shall have paid such fees and other compensation to the
Additional Commitment Lenders and the Increased Commitment Lenders as
the

        
          
            
            

          

          
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        Administrative Agent, the Lead Borrower, such Additional Commitment
Lenders and such Increased Commitment Lenders shall agree; (iv) the Borrowers
shall have paid such arrangement fees to the Administrative Agent (or one or
more of its Affiliates, as applicable) as the Lead Borrower and the
Administrative Agent or such Affiliate may agree; (v) the Borrowers shall
deliver to the Administrative Agent and the Lenders an opinion or opinions, in
form and substance reasonably satisfactory to the Administrative Agent, from
counsel to the Borrowers reasonably satisfactory to the Administrative Agent and
dated such date with respect to the Loan Documents and the other documents,
agreements and instruments then executed and the transactions contemplated
thereby; (vi) the Borrowers and the Additional Commitment Lender shall have
delivered such other instruments, documents and agreements as the Administrative
Agent may reasonably have requested; and (vii) no Default exists. The Borrowers
shall prepay any Committed Loans outstanding on the Increase Effective Date (and
pay any additional amounts required pursuant to Section 3.05 to the
extent necessary to keep the outstanding Committed Loans ratable with any
revised Applicable Percentages arising from any nonratable increase in the
Commitments under this Section
2.15).

        

        (f)           Terms of Commitment
Increase. Any Commitment Increase contemplated by the provisions of this
Section 2.15
shall, except as provided in Section 2.15(e)(iii)
and (e)(iv),
bear interest and be entitled to fees and other compensation on the same basis
as all other Commitments.

        

        (g)           Conflicting
Provisions. This Section 2.15 shall
supersede any provisions in Sections 2.13 or
10.01 to the contrary.

        

        ARTICLE
III

        TAXES,
YIELD PROTECTION AND ILLEGALITY; APPOINTMENT OF LEAD BORROWER

        

        3.01        Taxes.

        

        (a)           Payments Free of
Taxes. Any and all payments by or on account of any obligation of the
Borrowers hereunder or under any other Loan Document shall be made free and
clear of and without reduction or withholding for any Indemnified Taxes or Other
Taxes, provided
that if the Borrowers shall be required by applicable law to deduct any
Indemnified Taxes (including any Other Taxes) from such payments, then (i) the
sum payable shall be increased as necessary so that after making all required
deductions (including deductions applicable to additional sums payable under
this Section
3.01) the
Administrative Agent, Lender or LC Issuer, as the case may be, receives an
amount equal to the sum it would
have received had no such deductions been made, (ii) the Borrowers shall make
such deductions and (iii) the Borrowers shall timely pay the full amount
deducted to the relevant Governmental Authority in accordance with applicable
law; provided
further, that the Borrowers shall not be required to pay any additional amounts
with respect to income or tax or amounts owing to a Lender that (x) is a Foreign
Lender and (y) has not delivered the forms required by Section
3.01(e).

         

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

        

        (c)           Indemnification by the Loan
Parties. The Loan Parties shall indemnify the Administrative Agent, each
Lender and each LC Issuer, within three (3) Business Days after demand is made
therefor, for the full amount of any Indemnified Taxes or Other Taxes (including
Indemnified Taxes or Other Taxes imposed or asserted on or attributable to
amounts payable under this Section 3.01) paid by
the Administrative Agent, such Lender or LC Issuer, as the case may be, and any
penalties, interest and reasonable expenses arising therefrom or with respect
thereto; provided, that the
Borrower shall not be

         

        
          
            
            

          

          
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        obligated to make any payment pursuant to this Section in respect of
penalties, interest and other consequential liabilities attributable to any
Taxes or Other Taxes if (i) written demand therefor has not been made by such
Lender Party within 30 days from the date on which senior in-house legal counsel
or the chief financial officer such Lender Party had actual knowledge of the
imposition of Taxes or Other Taxes by the relevant taxing or Governmental
Authority, (ii) such penalties, interest and other consequential liabilities, as
a result of gross negligence or willful misconduct of such payee as determined
by a final, non-appealable decision of a court of competent jurisdiction, have
accrued after the date that Borrower indemnified or paid in full all amounts
owing under this Section as of such date, or (iii) such penalties, interest and
other liabilities are attributable to the gross negligence or willful misconduct
of such payee, as determined by a final, non-appealable decision of a court of
competent jurisdiction; provided, further, that the
Loan Parties shall not be required to make any indemnification with respect
to any
Foreign Lender that has not complied in all material respects with Section 3.01(e). A
certificate as to the amount of such payment or liability delivered to the Lead
Borrower by a Lender or the LC Issuer (with a copy to the Administrative Agent),
or by the Administrative Agent on its own behalf or on behalf of a Lender or the
LC Issuer, shall be conclusive absent manifest error.

        

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

        

        (e)           Status of Lenders.
Any Foreign Lender that is entitled to an exemption from or reduction of
withholding tax under the law of the jurisdiction in which any Borrower is
resident for tax purposes, or any treaty to which such jurisdiction is a party,
with respect to payments hereunder or under any other Loan Document shall
deliver to the Lead Borrower (with a copy to the Administrative Agent), at the
time or times prescribed by applicable Law or reasonably requested by the Lead
Borrower or the Administrative Agent, such properly completed and executed
documentation prescribed by applicable Law as will permit such payments to be
made without withholding or at a reduced rate of withholding. In addition, any
Lender, if requested by the Lead Borrower or the Administrative Agent, shall
deliver such other documentation prescribed by applicable Law or reasonably
requested by the Lead Borrower or the Administrative Agent as will enable the
Lead Borrower or the Administrative Agent to determine whether or not such
Lender is subject to backup withholding or information reporting
requirements.

        

        Without
limiting the generality of the foregoing, any Foreign Lender shall deliver to
the Lead Borrower and the Administrative Agent (in such number of copies as
shall be requested by the recipient) on or prior to the date on which such
Foreign Lender becomes a Lender under this Agreement (and from time to time
thereafter upon the request of the Lead Borrower or the Administrative Agent,
but only if such Foreign Lender is legally entitled to do so), whichever of the
following is applicable:          

        

        
          (i)         
duly completed copies of
Internal Revenue Service Form W-8BEN claiming eligibility for benefits of an
income tax treaty to which the United States is a party,  

           

          (ii)         
duly
completed copies of Internal Revenue Service Form W-8ECI,

        

        

        
          (iii)       
 in the
case of a Foreign Lender claiming the benefits of the exemption for
portfolio interest under section 881(c) of the Code, (x) a certificate to the
effect that such Foreign Lender is not (A) a "bank" within the meaning of
section 881(c)(3)(A) of the Code, (B) a "10 percent shareholder" of the
Borrowers within the meaning of section 881(c)(3)(B) of the Code, or (C) a
"controlled foreign corporation" described in section 881(c)(3)(C) of the Code
and (y) duly completed copies of Internal Revenue Service Form W-8BEN,
or

        

        

        
          
            
            

          

          
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        (iv)           any
other form prescribed by applicable Law as a basis for claiming exemption from
or a reduction in United States Federal withholding tax duly completed together
with such supplementary documentation as may be prescribed by applicable Law to
permit the Lead Borrower to determine the withholding or deduction required to
be made.

        

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

        

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

        

        3.03       Inability
to Determine Rates. If the Required Lenders determine that for any reason
in connection with
any request for a LIBO Rate Loan or a conversion to or continuation thereof that
(a) Dollar deposits are not being offered to banks in the London interbank
market for the applicable amount and Interest Period of such LIBO Rate Loan, (b)
adequate and reasonable means do not exist for determining the LIBO Rate for any
requested Interest Period with respect to a proposed LIBO Rate Loan , or (c) the
LIBO Rate for any requested Interest Period with respect to a proposed LIBO Rate
Loan does not adequately and fairly reflect the cost to such Lenders of funding
such Loan, the Administrative Agent will promptly so notify the Lead Borrower
and each Lender. Thereafter, the obligation of the Lenders to make or maintain
LIBO Rate Loans shall be suspended until the Administrative Agent (upon the
instruction of the Required Lenders) revokes such notice. Upon receipt of such
notice, the Lead Borrower may revoke any pending request for a Borrowing of,
conversion to or continuation of LIBO Rate Loans or, failing that, will be
deemed to have converted such request into a request for a Committed Borrowing
of Base Rate Loans in the amount specified therein.

        
 

        
          
            
            

          

          
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            3.04       
Increased
Costs; Reserves on LIBO Rate Loans.

        

        
        

        

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

        

        

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

        

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

        

        (iii)     
impose on any Lender or the LC Issuer or the London interbank market any other
condition, cost or expense affecting this Agreement or LIBO Rate Loans made by
such Lender or any Letter of Credit or participation therein;

        

        and the
result of any of the foregoing shall be to increase the cost to such Lender of
making or maintaining any LIBO Rate Loan (or of maintaining its obligation to
make any such Loan), or to increase the cost to such Lender or the LC Issuer of
participating in, issuing or maintaining any Letter of Credit (or of maintaining
its obligation to participate in or to issue any Letter of Credit), or to reduce
the amount of any sum received or receivable by such Lender or the LC Issuer
hereunder (whether of principal, interest or any other amount) then, upon
request of such Lender or the LC Issuer, the Borrowers will pay to such Lender
or the LC Issuer, as the case may be, such additional amount or amounts as will
compensate such Lender or the LC Issuer, as the case may be, for such additional
costs incurred or reduction suffered.

        

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

        

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

         

        
          
            
            

          

          
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        (d)           Delay in Requests.
Failure or delay on the part of any Lender or the LC Issuer to demand
compensation pursuant to the foregoing provisions of this Section shall not
constitute a waiver of such Lender’s or the LC Issuer’s right to demand such
compensation, provided that the
Borrowers shall not be required to compensate a Lender or the LC Issuer pursuant
to the foregoing provisions of this Section for any increased costs incurred or
reductions suffered more than 180 days prior to the date that such Lender or the
LC Issuer, as the case may be, notifies the Lead Borrower of the Change in Law
giving rise to such increased costs or reductions and of such Lender’s or the LC
Issuer’s intention to claim compensation therefor (except that, if the Change in
Law giving rise to such increased costs or reductions is retroactive, then the
180 days period referred to above shall be extended to include the period of
retroactive effect thereof).

        

        (e)           Reserves on LIBO Rate
Loans. The Borrowers shall pay to each Lender, as long as such Lender
shall be required to maintain reserves with respect to liabilities or assets
consisting of or including Eurocurrency funds or deposits (currently known as
"Eurocurrency liabilities"), additional interest on the unpaid principal amount
of each LIBO Rate Loan equal to the actual costs of such reserves allocated to
such Loan by such Lender (as determined by such Lender in good faith, which
determination shall be conclusive), which shall be due and payable on each date
on which interest is payable on such Loan, provided the Lead
Borrower shall have received at least 10 days’ prior notice (with a copy to the
Administrative Agent) of such additional interest from such Lender. If a Lender
fails to give notice 10 days prior to the relevant Interest Payment Date, such
additional interest shall be due and payable 10 days from receipt of such
notice.

        

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

        

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

        

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

        

        (c)           any
assignment of a LIBO Rate Loan on a day other than the last day of the Interest
Period therefor as a result of a request by the Lead Borrower pursuant to Section
10.13;

        

        including
any loss or expense arising from the liquidation or reemployment of funds
obtained by it to maintain such Loan or from fees payable to terminate the
deposits from which such funds were obtained. The Borrowers shall also pay any
customary administrative fees charged by such Lender in connection with the
foregoing.

        

        For
purposes of calculating amounts payable by the Borrowers to the Lenders under
this Section
3.05, each
Lender shall be deemed to have funded each LIBO Rate Loan made by it at the LIBO
Rate for such Loan by a
matching deposit or other borrowing in the London interbank market for a
comparable amount and for a comparable period, whether or not such LIBO Rate
Loan was in fact so funded.

        

        3.06        Mitigation
Obligations; Replacement of Lenders.

        

        (a) Designation of a Different
Lending Office. If any Lender requests compensation under Section 3.04, or the
Borrowers are required to pay any additional amount to any Lender or
any

        

        
          
            
            

          

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

        

        (b)           Replacement of
Lenders. If any Lender requests compensation under Section 3.04, or if the
Borrowers are required to pay any additional amount to any Lender or any
Governmental Authority for
the account of any Lender pursuant to Section 3.01, the
Borrowers may replace such Lender in accordance with Section
10.13.

        

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

        

        3.08       Designation
of Lead Borrower as Borrowers’ Agent.

        

        (a)           Each
Borrower hereby irrevocably designates and appoints the Lead Borrower as such
Borrower’s agent to obtain Credit Extensions, the proceeds of which shall be
available to each Borrower for such uses as are permitted under this Agreement.
As the disclosed principal for its agent, each Borrower shall be obligated to
each Credit Party on account of Credit Extensions so made as if made directly by
the applicable Credit Party to such Borrower, notwithstanding the manner by
which such Credit Extensions are recorded on the books and records of the Lead
Borrower and of any other Borrower. In addition, each Loan Party other than the
Borrowers hereby irrevocably designates and appoints the Lead Borrower as such
Loan Party’s agent to represent such Loan Party in all respects under this
Agreement and the other Loan Documents.

        

        (b)           Each
Borrower recognizes that credit available to it hereunder is in excess of and on
better terms than it otherwise could obtain on and for its own account and that
one of the reasons therefor is its joining in the credit facility contemplated
herein with all other Borrowers. Consequently, each Borrower hereby assumes and
agrees to discharge all Secured Obligations of each of the other
Borrowers.

        

        (c)           The
Lead Borrower shall act as a conduit for each Borrower (including itself, as a
"Borrower") on whose behalf the Lead Borrower has requested a Credit Extension.
Neither the Administrative Agent nor any other Credit Party shall have any
obligation to see to the application of such proceeds therefrom.

        

        ARTICLE
IV

        CONDITIONS
PRECEDENT TO CREDIT EXTENSIONS

        

        4.01       Conditions
of Initial Credit Extension. The obligation of the LC Issuer and
each Lender to make
its initial Credit Extension hereunder is subject to satisfaction of the
following conditions precedent:

        

        (a)           The
Administrative Agent’s receipt of the following, each of which shall be
originals or telecopies (followed promptly by originals) unless otherwise
specified, each properly

         

        
          
            
            

          

          
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        executed by a Responsible Officer of the signing Loan Party, each
dated the Closing Date (or, in the case of certificates of governmental
officials, a recent date before the Closing Date) and each in form and substance
satisfactory to the Administrative Agent:

        

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

        

        
           (ii)  
       a Note
executed by the Borrowers in favor of each Lender requesting a
Note;

        

         

        (iii)          such
certificates of resolutions or other action, incumbency certificates and/or
other certificates of Responsible Officers of each Loan Party as the
Administrative Agent and the Arrangers may require evidencing (A) the authority
of each Loan Party to enter into this Agreement and the other Loan Documents to
which such Loan Party is a party or is to be a party and (B) the identity,
authority and capacity of each Responsible Officer thereof authorized to act as
a Responsible Officer in connection with this Agreement and the other Loan
Documents to which such Loan Party is a party or is to be a party;

        

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

        

        (v)           a
favorable opinion of (i) Davis Polk & Wardwell LLP, counsel to the Loan
Parties and (ii) such local counsel to the Loan Parties, in each case addressed
to the Administrative Agent and each Lender and as to such matters concerning
the Loan Parties and the Loan Documents as the Administrative Agent and the
Arrangers may reasonably request (including, without limitation, with respect to
enforceability, due authorization, perfection of the Liens in favor of the
Collateral Agent and absence of conflicts with specified material
agreements);

        

        (vi)           a
certificate signed by a Responsible Officer of the Lead Borrower certifying (A)
that the conditions specified in Sections 4.02(a) and
(b) have been
satisfied, (B) that there has been no event or circumstance since the date of
the Audited Financial Statements that has had or could be reasonably expected to
have, either individually or in the aggregate, a Material Adverse Effect and (C)
either that (1) no consents, licenses or approvals are required in connection
with the execution, delivery and performance by such Loan Party and the validity
against such Loan Party of the Loan Documents to which it is a party, or (2)
that all such consents, licenses and approvals have been obtained and are in
full force and effect;

        

        (vii)           evidence
that all insurance required to be maintained pursuant to the Loan Documents and,
except for the endorsements specified on Schedule 4.01(a)
hereto which shall be delivered no later than 15 days after the Closing Date,
all endorsements in favor of the Collateral Agent required under the Loan
Documents have been obtained and are in effect;

        

        
          
            
            

          

          
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        (viii)           a
payoff letter from (A) Bank of America, N.A., as agent for the lenders under the
Existing Credit Agreement and (B) Bank of America. N.A., as agents for the
lenders under the Existing BCNB Credit Agreement, in each case satisfactory in
form and substance to the Administrative Agent evidencing that each such credit
facility has been or concurrently with the Closing Date is being terminated, all
obligations thereunder are being paid in full, and all Liens securing
obligations thereunder have been or concurrently with the Closing Date are being
released;

        

        (ix)           a
certificate from the chief financial officer of the Lead Borrower, satisfactory
in form and substance to the Administrative Agent, attesting to the Solvency of
the Loan Parties on a Consolidated basis as of the Closing Date after giving
effect to the transactions contemplated hereby;

        

        (x)           except
for the Securities Account Control Agreements specified on Schedule 4.01(b)
hereto, which shall be duly executed and delivered no later than 15
days after
the Closing Date, the Security Documents (other than the Mortgages), each duly
executed by the applicable Loan Parties (it being understood that no Mortgages
will be executed and delivered as of the Closing Date);

        

        (xi)          all
other Loan Documents, each duly executed by the applicable Loan
Parties;

        

        (xii)          results
of searches or other evidence reasonably satisfactory to the Collateral Agent
and the Arrangers (in each case dated as of a date reasonably satisfactory to
the Collateral Agent and the Arrangers) indicating the absence of Liens on the
assets of the Loan Parties, except for Permitted Encumbrances and Liens for
which termination statements and releases, satisfactions and discharges of any
mortgages, and releases or subordination agreements satisfactory to the
Collateral Agent and the Arrangers are being tendered concurrently with such
extension of credit or other arrangements satisfactory to the Collateral Agent
and the Arrangers for the delivery of such termination statements and releases,
satisfactions and discharges have been made;

        

        (xiii)         (A)
all documents and instruments, including Uniform Commercial Code financing
statements, required by law or reasonably requested by the Collateral Agent and
the Arrangers to be filed, registered or recorded to create or perfect the first
priority Liens intended to be created under the Loan Documents and all such
documents and instruments shall have been so filed, registered or recorded, in
each case, to the reasonable satisfaction of the Collateral Agent and the
Arrangers, (B) the Blocked Account Agreements required pursuant to Section 6.13 hereof,
and (C) control agreements with respect to the Loan Parties’ securities and
investment accounts;

        

        (xiv)       certified
copies of each of the BNCB Acquisition Documents, including the Seller Notes, as
amended and in effect on the Closing Date, duly executed by the parties thereto
and in form and substance substantially the same as the form and substance of
such agreements and documents dated August __, 2009 delivered to and approved by
the Administrative Agent, together with all agreements, instruments and other
documents delivered in connection therewith as the Administrative Agent shall
request; and

        

        (xv)         such
other assurances, certificates, documents, consents or opinions as the Agents
reasonably may require.

        

        
          
            
            

          

          
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        (b)           The
BNCB Acquisition shall have been consummated in accordance with the BNCB
Acquisition Documents and in compliance with all applicable Laws and regulatory
rules of any Governmental Authority.

        

        (c)           After
giving effect to (i) the consummation of the BNCB Acquisition, (ii) the first
funding under the Loans, (iii) any charges to the Loan Account made in
connection with the establishment of the credit facility contemplated hereby and
(iv) all Letters of Credit to be issued at, or immediately subsequent to, such
establishment, Availability shall be not less than $400,000,000.

        

        (d)           The
Administrative Agent shall have received a Borrowing Base Certificate dated the
Closing Date and relating to the month ended on August 29, 2009, duly executed
by a Responsible Officer of the Lead Borrower.

        

        (e)           To
event or condition has occurred since April 30, 2009, that could reasonably be
expected, individually or in the aggregate, to constitute or have (i) a material
adverse change in, or a material adverse effect on, the operations, business,
assets, properties, liabilities (actual or contingent) or condition (financial
or otherwise) of the Lead Borrower, BNCB and their subsidiaries, taken as a
whole; (ii) a material impairment of the ability of any Loan Party to perform
its material obligations under any material Loan Document to which it is a
party; or (iii) a material impairment of the rights and remedies of the
Administrative Agent or the Lenders under any material Loan Document or (iv) a
material adverse effect upon the legality, validity, binding effect or
enforceability against any Loan Party of any material Loan Document or material
BNCB Acquisition Document to which it is a party.

        

        (f)           The
Administrative Agent and the Arrangers shall have received and be reasonably
satisfied with (i) the pro forma consolidated projected financial statements of
the Lead Borrower and its Subsidiaries, giving effect to all elements of the
BNCB Acquisition to be effected on or before the Closing Date, (ii) forecasts
prepared by the Lead Borrower consisting of (A) pro forma consolidated balance
sheets, income statements, and cash flow statements (including a projection of
Availability) on a monthly basis through December 31, 2010, and (B) consolidated
balance sheets, income statements, and cash flow statements (including a
projection of Availability) on an annual basis thereafter through and including
the year in which the Maturity Date occurs; and (iii) historical financial
statements consisting of consolidated balance sheets, income statements, and
cash flow statements (A) for the Lead Borrower and its Subsidiaries for Fiscal
Quarter and Fiscal Month of the Lead Borrower ended August 1, 2009, and (B) for
BNCB and its subsidiaries for fiscal quarter and fiscal month of BNCB ending
August 1, 2009.

        

        (g)           All
necessary consents and approvals to the transactions contemplated hereby shall
have been obtained.

        

        (h)           After
giving effect to the consummation of the BNCB Acquisition and the other
transactions contemplated under this Agreement and the other Loan Documents on
the Closing Date (including any Loans made or Letters of Credit issued
hereunder), no Default shall exist.

        

        (i)           All
fees required to be paid to the Agents or the Arrangers on or before the Closing
Date shall have been paid in full, and all fees required to be paid to the
Lenders on or before the Closing Date shall have been paid in full.

        

        (j)           The
Administrative Agent shall have received all documentation and other information
required by regulatory authorities under applicable "know your customer" and
anti-money laundering rules and regulations, including without limitation the
USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001))
(the "Patriot
Act").

         

        
          
            
            

          

          
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        Without limiting the generality of the provisions of Section 9.04, for
purposes of determining compliance with the conditions specified in this Section 4.01, each
Lender that has signed this Agreement shall be deemed to have Consented to,
approved or accepted or to be satisfied with, each document or other matter
required thereunder to be Consented to or approved by or acceptable or
satisfactory to a Lender unless the Administrative Agent shall have received
notice from such Lender prior to the proposed Closing Date specifying its
objection thereto.

        

        4.02       Conditions
to all Credit Extensions. The obligation of each Lender to honor any Request for Credit
Extension (other than a Conversion/Continuation Notice requesting only a
conversion of Committed Loans to the other Type or a continuation of LIBO Rate
Loans) and of each LC Issuer to issue each Letter of Credit is subject to the
following conditions precedent:

        

        (a)           The
representations and warranties of the Lead Borrower and each other Loan Party
contained in Article
V or any other Loan Document, or which are contained in any document
furnished at any time under or in connection herewith or therewith, (i) which
are qualified by materiality shall be true and correct, and (ii) which are not
qualified by materiality shall be true and correct in all material respects, in
each case, on and as of the date of such Credit Extension, except to the extent
that such representations and warranties specifically refer to an earlier date,
in which case they shall be true and correct, or true and correct in all
material respects, as the case may be, as of such earlier date, and except that
for purposes of this Section 4.02, the
representations and warranties contained in subsections (a) and
(b) of Section
5.05 shall be deemed to refer to the most recent consolidated
statements furnished pursuant to clauses (a) and (b), respectively, of Section
6.01.

        

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

        

        (c)           The
Administrative Agent and, if applicable, the LC Issuer or the Swing Line Lender
shall have received a Request for Credit Extension in accordance with the
requirements hereof.

        

        Each
Request for Credit Extension (other than a Conversion/Continuation Notice
requesting only a conversion of Committed Loans to the other Type or a
continuation of LIBO Rate Loans) submitted by the Lead Borrower shall be deemed
to be a representation and warranty by the Borrowers that the conditions
specified in Sections
4.02(a) and 4.02(b) have been
satisfied on and as of the date of the applicable Credit Extension. The
conditions set forth in this Section 4.02 are for
the sole benefit of the Credit Parties but until the Required Lenders otherwise
direct the Administrative Agent to cease making Committed Loans, the Lenders
will fund their Applicable Percentage of all Loans and LC Advances and
participate in all Swing Line Loans and Letters of Credit whenever made or
issued, which are requested by the Lead Borrower and which, notwithstanding the
failure of the Loan Parties to comply with the provisions of this Article IV are agreed
to by the Administrative Agent; provided, however, that, if the
Administrative Agent has actual knowledge that any Specified Default or any
Event of Default under Section 6.13 shall
have occurred and be continuing, the Administrative Agent shall cease
making Committed Loans
unless the Required Lenders otherwise direct in writing; provided, further, that the
making of any such Loans or the issuance of any Letters of Credit shall not be
deemed a modification or waiver by any Credit Party of the provisions of this
Article IV on
any future occasion or a waiver of any rights of the Credit Parties as a result
of any such failure to comply.

        

        
          
            
            

          

          
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        ARTICLE
V

        REPRESENTATIONS
AND WARRANTIES

        

        To induce the Credit Parties to enter into this Agreement and to
make Loans and to issue Letters of Credit hereunder, each Loan Party represents
and warrants to the Administrative Agent and the other Credit Parties
that:

        

        5.01       Existence,
Qualification and Power. Each Loan Party (a) is a corporation,
limited liability
company, partnership or limited partnership, duly organized or formed, validly
existing and, where applicable, in good standing under the Laws of the
jurisdiction of its incorporation or organization, (b) has
all requisite power and authority and all requisite governmental licenses,
permits, authorizations, consents and approvals to (i) own, lease or operate its
assets and carry on its business as now conducted and (ii) execute, deliver and
perform its obligations under the Loan Documents to which it is a party, and
(c) is duly
qualified and is licensed and, where applicable, in good standing under the Laws
of each jurisdiction where its ownership, lease or operation of properties or
the conduct of its business requires such qualification or license; except in
each case referred to in clause (b)(i) or (c), to the extent that failure to do
so could not reasonably be expected to have a Material Adverse Effect. Schedule
5.01 annexed hereto sets forth, as of the Closing Date, each Loan Party’s
name as it appears in official filings in its state of incorporation or
organization, its state of incorporation or organization, organization type,
organization number, if any, issued by its state of incorporation or
organization, and its federal employer identification
number.

        

        5.02       Authorization;
No Contravention. The execution, delivery and performance by each Loan
Party of each Loan Document to which such Person is or is to be a party, has
been duly authorized by all necessary corporate or other organizational action,
and does not and will not (a) contravene the terms of any of such Person's
Organization Documents; (b) conflict with or result in any breach, termination,
or contravention of, or constitute a default under, or require any payment to be
made under (i) any
Material Contract or any Material Indebtedness to which such Person is a party
or affecting such Person or the properties of such Person or any of its
Subsidiaries, or (ii) any order, injunction, writ or decree of any Governmental
Authority or any arbitral award to which such Person or its property is subject;
(c) result in or require the creation of any Lien upon any asset of any Loan
Party (other than Permitted Encumbrances); or (d) violate any Law.

        

        5.03       Governmental
Authorization; Other Consents. No approval, consent, exemption, authorization,
or other action by, or notice to, or filing with, any Governmental Authority or
any other Person is necessary or required in connection with the execution,
delivery or performance by, or enforcement against, any Loan Party of this
Agreement or any other Loan Document, except for (a) the perfection or
maintenance of the Liens created under the Security Documents (including the
first priority nature thereof to the extent specified in the Security Agreement)
or (b) such as have been obtained or made and are in full force and
effect.

        

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

        

        
          5.05       Financial
Statements; No Material Adverse Effect.

        

        

        (a)           The
Audited Financial Statements (i) were prepared in accordance with GAAP
consistently applied throughout the period covered thereby, except as otherwise
expressly noted therein; (ii) fairly present the financial condition of the Lead
Borrower and its Subsidiaries as of the date thereof

        

        
          
            
            

          

          
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        and their results of operations for the period covered thereby in
accordance with GAAP consistently applied throughout the period covered thereby,
except as otherwise expressly noted therein; and (iii) show all Material
Indebtedness and other liabilities, direct or contingent, of the Lead Borrower
and its Subsidiaries as of the date thereof, including liabilities for taxes,
material commitments and Indebtedness.

        

        (b)           The
unaudited Consolidated balance sheet of the Lead Borrower and its Subsidiaries
dated August 1, 2009, and the related Consolidated statements of income or
operations, Shareholders’ Equity and cash flows for the fiscal quarter ended on
that date (i) were prepared in accordance with GAAP consistently applied
throughout the period covered thereby, except as otherwise expressly noted
therein, and (ii) fairly present the financial condition of the Lead Borrower
and its Subsidiaries as of the date thereof and their results of operations for
the period covered thereby, subject, in the case of clauses (i) and (ii), to the
absence of footnotes and to normal year-end audit adjustments. Schedule 5.05 sets
forth all Material Indebtedness and other liabilities, direct or contingent, of
the Loan Parties and
their Consolidated Subsidiaries as of the date of such financial statements,
including liabilities for taxes, material commitments and Material
Indebtedness.

        

        (c)           Since
the date of the Audited Financial Statements, there has been no event or
circumstance, either individually or in the aggregate, that has had or could
reasonably be expected to have a Material Adverse Effect.

        

        (d)           The
Consolidated forecasted balance sheet and statements of income and cash flows of
the Lead Borrower and its Subsidiaries delivered pursuant to Section 4.01(f) and
Section 6.01(d)
were prepared in good faith on the basis of the assumptions stated therein,
which assumptions were fair in light of the conditions existing at the time of
delivery of such forecasts, and represented, at the time of delivery, the Loan
Parties’ reasonable estimate of its future financial performance (it being
understood that such forecasted financial information is subject to significant
uncertainties and contingencies, many of which are beyond the control of the
Loan Parties, that no assurance is given that any particular forecasts will be
realized, that results may differ and that such differences may be
material).

        

        5.06       Litigation.
There are no actions, suits, proceedings, claims or disputes pending or, to
the knowledge
of the Loan Parties after due and diligent investigation, threatened or
contemplated, at law, in equity, in arbitration or before any Governmental
Authority, by or against any Loan Party or any of its Subsidiaries or against
any of its properties or revenues that (a) purport to affect or pertain to this
Agreement or any other Loan Document, or any of the transactions contemplated
hereby, or (b) except as specifically disclosed in Schedule 5.06, either
individually or in the aggregate, if determined adversely, could reasonably be
expected to have a Material Adverse Effect.

        

        5.07       No
Default. No Default has occurred and is continuing or would result from
the consummation
of the transactions contemplated by this Agreement or any other Loan
Document.

        

        5.08       Ownership
of Property; Liens. Each of the Loan Parties and each Subsidiary
thereof has
good record and marketable title in fee simple to or valid leasehold interests
in or other rights to use or operate, all real property necessary or used in the
ordinary conduct of its business, except for such defects in title as could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect. Each of the Loan Parties and each Subsidiary has good and
marketable title to, valid leasehold interests in, or valid licenses to use all
personal property and assets used in the ordinary conduct of its business,
except for such defects in title as could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.

        

        (a)           Schedule 5.08(b)(1)
sets forth the address (including street address, county and state) of all Real
Estate that is owned by the Loan Parties. Schedule 5.08(b)(2)
sets forth the address

        

        
          
            
            

          

          
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        (including street address, county and state) of the Leases of the
Loan Parties, together with the name of the lessor and its contact information
with respect to each such Lease as of the Closing Date. As of the Closing Date,
each Lease set forth on Schedule 5.08(b)(2)
is in full force and effect.

        

        (b)           The
personal property of each Loan Party and each of its Subsidiaries is subject to
no Liens, other than Liens set forth on Schedule 7.01, and
Permitted Encumbrances. The real property of each Loan Party and each of its
Subsidiaries is subject to no Liens, other than Permitted Encumbrances, or, in
the case of Real Estate included in the Borrowing Base, Permitted Real Estate
Liens.

        

        (c)           Schedule 7.02 sets
forth a complete and accurate list of all Investments held by any Loan Party or
any Subsidiary of a Loan Party on the date hereof, showing as of the date hereof
the amount, obligor or issuer, how held (directly or through a securities
intermediary) and maturity, if any, thereof.

        

        (d)           Schedule 7.03 sets
forth a complete and accurate list of all Indebtedness of each Loan Party or any
Subsidiary of a Loan Party on the date hereof, showing as of the date hereof the
amount, holder, obligor or issuer and maturity thereof.

        

        5.09       Environmental
Compliance. Except as specifically disclosed in Schedule 5.09, no
Loan Party or any
Subsidiary thereof (i) has failed to comply with any Environmental Law or to
obtain, maintain or comply with any permit, license or other approval required
under any Environmental Law, (ii) has become subject to any Environmental
Liability, (iii) has received notice of any claim with respect to any
Environmental Liability or (iv) knows of any basis for any Environmental
Liability, except, in each of the cases of (i), (ii), (iii) and (iv), as could
not, individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.

        

        (b)           Except
as otherwise set forth in Schedule 5.09, and
except as could not, individually or in the aggregate reasonably be expected to
have a Material Adverse Effect (i) none of the real properties currently or
formerly owned or operated by any Loan Party or any Subsidiary thereof is listed
or, to the knowledge of the Loan Parties, proposed for listing on the NPL or on
the CERCLIS or any analogous foreign, state or local list or, to the knowledge
of the Loan Parties, is adjacent to any such property; (ii) there are no and
never have been any underground or above-ground storage tanks or any surface
impoundments, septic tanks, pits, sumps or lagoons in which Hazardous Materials
are being or have been treated, stored or disposed of on any property currently
owned or operated by any Loan Party or any Subsidiary thereof or, to the
knowledge of the Loan Parties, on any property formerly owned or operated by any
Loan Party or Subsidiary thereof; (iii) there is no asbestos or
asbestos-containing material on any property currently owned or operated by any
Loan Party or Subsidiary thereof; and (iv) Hazardous Materials have not been
released, discharged or disposed of on any property currently or, to the
knowledge of the Loan Parties, formerly owned or operated by any Loan Party or
any Subsidiary thereof.

        

        (c)           Except
as otherwise set forth on Schedule 5.09, and
except as could not, individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect (i) no Loan Party or any Subsidiary thereof is
undertaking, and no Loan Party or any Subsidiary thereof has completed, either
individually or together with other potentially responsible parties, any
investigation or assessment or remedial or response action relating to any
actual or threatened release, discharge or disposal of Hazardous Materials at
any site, location or operation, either voluntarily or pursuant to the order of
any Governmental Authority or the requirements of any Environmental Law, other
than any than as may have been required under Section 6.16(c)
to

        
          
            
            

          

          
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        maintain the value and marketability of any Eligible Real Estate or
by any Governmental Authority or Environmental Law; and (ii) all Hazardous
Materials generated, used, treated, handled or stored at, or transported to or
from, any property currently or formerly owned or operated by any Loan Party or
any Subsidiary thereof have been disposed of in a manner not reasonably expected
to result in liability to any Loan Party or any Subsidiary
thereof.

        

        5.10       Insurance.
The properties (including, without limitation, all Collateral) of the Loan Parties
and their Subsidiaries are insured with financially sound and reputable
insurance companies which are not Affiliates of the Loan Parties (with the
exception of Chelsea Insurance Company Ltd. so long as it is duly licensed by
the appropriate Government Authority in its state of incorporation to conduct
business as an insurer in such state and meets and maintains the appropriate
capital requirements to maintain such licensure), in such amounts, with such
deductibles and covering such risks as are customarily carried by companies
engaged in similar businesses and owning similar properties in localities where
the Loan Parties or the applicable Subsidiary operates. Schedule 5.10 sets
forth a description of all insurance maintained by or on behalf of the Loan
Parties as of the Closing Date. As of the Closing Date, each insurance policy
listed on Schedule
5.10 , and, thereafter, each insurance policy reflected on an Accord
Certificate or other evidence of insurance most recently delivered to the
Administrative Agent in accordance herewith is in full force and effect and all
premiums in respect thereof that are due and payable have been
paid.

        

        5.11       Taxes.
The Loan Parties and their Subsidiaries have filed all Federal, state and
other material
tax returns and reports required to be filed, and have paid all Federal, state
and other material taxes, assessments, fees and other governmental charges
levied or imposed upon them or their properties, income or assets otherwise due
and payable, except those which are being contested in good faith by appropriate
proceedings being diligently conducted, for which adequate reserves have been
provided in accordance with GAAP, as to which Taxes no material Lien has been
filed and which contest effectively suspends the collection of the contested
obligation and the enforcement of any Lien securing such obligation. There is no
proposed tax assessment against any Loan Party or any Subsidiary that would, if
made, be reasonably expected to have a Material Adverse Effect. No Loan Party or
any Subsidiary thereof is a party to any tax sharing agreement other than (i)
the tax sharing agreement between Lead Borrower and Game Stop Corp. and (ii) the
BNCB Acquisition Documents.

        

        
          5.12       ERISA
Compliance.

        

        

        (a)           Each
Plan is in compliance in all material respects with the applicable provisions of
ERISA, the Code and other Federal or state Laws. Each Plan that is intended to
qualify under Section 401(a) of the Code has received a favorable determination
letter from the IRS or an application for such a letter is currently being
processed by the IRS with respect thereto and, to the best knowledge of the Lead
Borrower, nothing has occurred which would prevent, or cause the loss of, such
qualification. The Loan Parties and each ERISA Affiliate have made all required
contributions to each Plan subject to Section 412 of the Code, and no
application for a funding waiver or an extension of any amortization period
pursuant to Section 412 of the Code is pending or in effect with respect to any
Plan, except to the extent any failure to make such contribution would
reasonably be expected to have a Material Adverse Effect.

        

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

        

        
          
            
            

          

          
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        (c)      (i)     
Except as set forth in Schedule 5.12, (i) no
ERISA Event has occurred or is reasonably expected to occur; (ii) no Pension
Plan has any Unfunded Pension Liability; (iii) neither any Loan Party nor any
ERISA Affiliate has incurred, or reasonably expects to incur, any liability
under Title IV of ERISA with respect to any Pension Plan (other than premiums
due and not delinquent under Section 4007 of ERISA); (iv) neither any Loan Party
nor any ERISA Affiliate has incurred, or reasonably expects to incur, any
liability (and no event has occurred which, with the giving of notice under
Section 4219 of ERISA, would result in such liability) under Sections 4201 or
4243 of ERISA with respect to a Multiemployer Plan; and (v) neither any Loan
Party nor any ERISA Affiliate has engaged in a transaction that could be subject
to Sections 4069 or 4212(c) of ERISA, except in each case to the extent the
occurrence of any event described in the foregoing clauses (i) through (iv)
could not reasonably be expect to have a Material Adverse
Effect.

        

        5.13       Subsidiaries;
Equity Interests. As of the Closing Date, the Loan Parties have no Subsidiaries
other than those specifically disclosed in Part (a) of Schedule 5.13, which
Schedule sets forth the legal name, jurisdiction of incorporation or formation
and authorized Equity Interests of each such Subsidiary. As of the Closing Date,
(a) all of the outstanding Equity Interests in such Subsidiaries have been
validly issued, are fully paid and non-assessable and are owned by a Loan Party
(or a Subsidiary of a Loan Party) in the amounts specified on Part (a) of Schedule 5.13 free
and clear of all Liens, (b) except as set forth in Schedule 5.13, there
are no outstanding rights to purchase any Equity Interests in any Subsidiary and
(c) the Loan Parties have no equity investments in any other corporation or
entity other than those specifically disclosed in Part(b) of Schedule
5.13.

        

        
          5.14         
 Margin
Regulations; Investment Company Act.

        

        

        (a)           No
Loan Party is engaged or will be engaged, principally or as one of its important
activities, in the business of purchasing or carrying margin stock (within the
meaning of Regulation U issued by the FRB), or extending credit for the purpose
of purchasing or carrying margin stock. None of the proceeds of the Credit
Extensions shall 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 Credit Extensions to be
considered a "purpose credit" within the meaning of Regulations T, U, or X
issued by the FRB.

        

        (b)           None
of the Loan Parties nor any Subsidiary is or is required to be registered as an
"investment company" under the Investment Company Act of 1940.

        

        5.15       Disclosure.
Each Loan Party has disclosed to the Administrative Agent and the Lenders all agreements,
instruments and corporate or other restrictions to which it or any of its
Subsidiaries is subject, and all other matters known to it, that, individually
or in the aggregate, could reasonably be expected to result in a Material
Adverse Effect. No report, financial statement, certificate or other information
furnished (whether in writing or orally) and prepared by or on behalf of any
Loan Party to the Administrative Agent or any Lender in connection with the
transactions contemplated hereby and the negotiation of this Agreement or
delivered hereunder or under any other Loan Document (in each case, as modified
or supplemented by other information so furnished) contains any material
misstatement of fact or omits to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not materially misleading; provided that, with
respect to projected financial information, the Loan Parties represent only that
such information was prepared in good faith based upon assumptions believed to
be reasonable at the time (it being understood that such projections are subject
to significant uncertainties and contingencies, many of which are beyond the
control of the Loan Parties, that no assurance is given that any particular
forecasts will be realized, that actual results may differ and that such
differences may be material).

        

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

        

        5.17       Intellectual
Property; Licenses, Etc. (a) As of the effective date of the BNCB Acquisition
and at all times thereafter, the Loan Parties and their Subsidiaries own, or
possess the right to use, all the Intellectual Property that is reasonably
necessary for the operation of their respective businesses, and (b) to the
knowledge of any Responsible Officer, no Loan Party nor any Subsidiary has
infringed upon any rights held by any other Person, in each case except as would
not reasonably be expected to have a Material Adverse Effect.

        

        5.18       Labor
Matters. There are no strikes, lockouts, slowdowns or other material
labor disputes
against any Loan Party or any Subsidiary thereof pending or, to the knowledge of
any Loan Party, threatened. The hours worked by and payments made to employees
of the Loan Parties comply with the Fair Labor Standards Act and any other
applicable federal, state, local or foreign Law dealing with such matters except
to the extent that any such violation could not reasonably be expected to have a
Material Adverse Effect. No Loan Party or any of its Subsidiaries has incurred
any liability or obligation under the Worker Adjustment and Retraining Act or
similar state Law. All payments due from any Loan Party and its Subsidiaries, or
for which any claim may be made against any Loan Party, on account of wages and
employee health and welfare insurance and other benefits, have been paid or
properly accrued in accordance with GAAP as a liability on the books of such
Loan Party. Except as set forth on Schedule 5.18 no Loan Party or
any Subsidiary is a party to or bound by any collective bargaining
agreement. There are no
representation proceedings pending or, to any Loan Party’s knowledge, threatened
to be filed with the National Labor Relations Board, and no labor organization
or group of employees of any Loan Party or any Subsidiary has made a pending
demand for recognition in each case which could individually or in the aggregate
be reasonably expected to result in a Material Adverse Effect. There are no
complaints, unfair labor practice charges, grievances, arbitrations, unfair
employment practices charges or any other claims or complaints against any Loan
Party or any Subsidiary pending or, to the knowledge of any Loan 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 of any employee of any Loan Party or any of its
Subsidiaries which could, individually or in the aggregate, be reasonably
expected to result in a Material Adverse Effect. The consummation of the
transactions contemplated by the Loan Documents will not give rise to any right
of termination or right of renegotiation on the part of any union under any
collective bargaining agreement to which any Loan Party or any of its
Subsidiaries is bound except as could not reasonably be expected to have
individually or in the aggregate, a Material Adverse Effect.

        

        
          5.19     
     Security
Documents.

        

        

        (a)           The
Security Documents, other than any Mortgages, create in favor of the Collateral
Agent, for the benefit of the Secured Parties referred to therein, a legal,
valid, continuing and enforceable security interest in the Collateral (as
defined in the Security Agreement), the enforceability of which is subject to
applicable bankruptcy, insolvency, reorganization, moratorium or other laws
affecting creditors’ rights generally and subject to general principles of
equity, regardless of whether considered in a proceeding in equity or at law.
The financing statements, releases and other filings are in appropriate form and
have been or will be filed in the offices specified in the Perfection
Certificate. Upon such filings and/or the obtaining of "control," the Collateral
Agent will have a perfected Lien on, and security interest in, to and under all
right, title and interest of the grantors thereunder in all Collateral that may
be

        

        
          
            
            

          

          
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        perfected by filing, recording or registering a financing statement
or analogous document (including without limitation the proceeds of such
Collateral subject to the limitations relating to such proceeds in the UCC) or
by obtaining control, under the UCC (in effect on the date this representation
is made) in each case prior and superior in right to any other Person, except in
the case of Liens permitted under clauses (c), (d), (f), (h), (m) or (p) (with
respect to Excluded Assets) of Section 7.01
hereof.

        

        (b)           As
of the date that any Real Estate is to be designated as Eligible Real Estate and
included in the Borrowing Base, all Real Estate Eligibility Requirements
(including delivery of all Mortgage Related Documents) have been met with
respect to such Real Estate.

        

        (c)           Each
Mortgage, if any, as may be executed and delivered by any Borrower from time to
time, creates in favor of the Collateral Agent, for the benefit of the Secured
Parties referred to therein, a legal, valid, and enforceable Lien in the
Mortgaged Property (as defined in applicable Mortgage), the enforceability of
which is subject to applicable bankruptcy, insolvency, reorganization,
moratorium or other laws affecting creditors’ rights generally and subject to
general principles of equity, regardless of whether considered in a proceeding
in equity or at law. Upon the recording of each Mortgage with the appropriate
Governmental Authorities and the payment of any mortgage recording taxes or
fees, the Collateral Agent will have a perfected Lien on, and security interest
in, to and under all right, title and interest of the grantors thereunder in
such Mortgaged Property (including without limitation the proceeds of such
Mortgaged Property) that may be perfected by such recording.

        

        5.20        Solvency.
After giving effect to the transactions contemplated by this Agreement, and before
and after giving effect to each Credit Extension, the Loan Parties, on a
Consolidated basis, are, and will be, Solvent. No transfer of property has been
or will be made by any Loan Party and no obligation has been or will be incurred
by any Loan Party in connection with the transactions contemplated by this
Agreement or the other Loan Documents with the intent to hinder, delay, or
defraud either present or future creditors of any Loan Party.

        

        
          5.21       
Deposit
and Securities Accounts; Credit Card Arrangements.

        

        

        (a)           Annexed
hereto as Schedule
5.21(a) is a list of all DDAs maintained by the Loan Parties as of the
Closing Date, which Schedule includes, with respect to each DDA (i) the name and
address of and contact person at the depository; (ii) the account number(s)
maintained with such depository; and (iv) the identification of each Blocked
Account Bank.

        

        (b)           Annexed
hereto as Schedule
5.21(b) is a list describing all arrangements as of the Closing Date to
which any Loan Party is a party with respect to the processing and/or payment to
such Loan Party of the proceeds of any credit card charges for sales made by
such Loan Party.

        

        (c)           Annexed
hereto as Schedule
5.21(c) is a list describing each securities account of the Loan Parties
as of the Closing Date which schedule includes, with respect to each securities
account, (i) the name and address of the Securities Intermediary, (ii) a
description and value of all property held therein and (iii) the account numbers
and name of such accounts.

        

        5.22        Brokers.
No broker or finder brought about the obtaining, making or closing of the Loans
or transactions contemplated by the Loan Documents, and no Loan Party or
Affiliate thereof has any obligation to any Person in respect of any finder’s or
brokerage fees in connection therewith.

        

        5.23        Customer
and Trade Relations. There exists no actual or, to the knowledge of
any Loan
Party, threatened, termination or cancellation of, or any modification or change
in the business

        

        
          
            
            

          

          
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        relationship of any Loan Party with any supplier which could
reasonably be expected to have a Material Adverse Effect.

        

        5.24       Storage
Locations. There are no warehouse or other storage or distribution
facilities leased
by the Loan Parties (excluding Stores) in which, in the aggregate, more than
$15,000,000 of Inventory is or may be located from time to time and with respect
to which the Loan Parties have not caused to be delivered to the Administrative
Agent a Collateral Access Agreements.

        

        ARTICLE
VI

        AFFIRMATIVE
COVENANTS

        

        So long
as any Obligation hereunder (other than contingent indemnification obligations
as to which no claim has been asserted) shall not be Fully Satisfied, the Loan
Parties shall, and (except in the case of the covenants set forth in Sections 6.01, 6.02 and 6.03) shall cause
each Subsidiary to:

        

        6.01       Financial
Statements. Deliver to the Administrative Agent, in form and detail reasonably satisfactory
to the Administrative Agent:

        

        (a)           as
soon as available, but in any event within 90 days after the end of each Fiscal
Year of the Lead Borrower, a Consolidated balance sheet of the Lead Borrower and
its Subsidiaries as at the end of such Fiscal Year, and the related consolidated
statements of income or operations, Shareholders’ Equity and cash flows for such
Fiscal Year, setting forth in each case in comparative form the figures for the
previous Fiscal Year, all in reasonable detail and prepared in accordance with
GAAP, such consolidated statements to be audited and accompanied by a report and
unqualified opinion of a Registered Public Accounting Firm of nationally
recognized standing reasonably acceptable to the Administrative Agent, which
report and opinion shall be prepared in accordance with generally accepted
auditing standards and shall not be subject to any "going concern" or like
qualification or exception or any qualification or exception as to the scope of
such audit;

        

        (b)           as
soon as available, but in any event within 45 days after the end of each of the
first three Fiscal Quarters of each Fiscal Year of the Lead Borrower, a
Consolidated balance sheet of the Lead Borrower and its Subsidiaries as at the
end of such Fiscal Quarter, and the related consolidated statements of income or
operations, Shareholders’ Equity and cash flows for such Fiscal Quarter and for
the portion of the Lead Borrower's Fiscal Year then ended, setting forth in each
case in comparative form the figures for (A) the corresponding Fiscal Quarter of
the previous Fiscal Year and (B) the corresponding portion of the previous
Fiscal Year, all in reasonable detail, such Consolidated statements to be
certified by a Responsible Officer of the Lead Borrower as fairly presenting the
financial condition, results of operations, Shareholders’ Equity and cash flows
of the Lead Borrower and its Subsidiaries as of the end of such Fiscal Quarter
in accordance with GAAP, subject only to normal year-end audit adjustments and
the absence of footnotes;

        

        (c)           as
soon as available, but in any event within 30 days after the end of each Fiscal
Month of each Fiscal Year (excluding the end of any Fiscal Month which is also
the end of a Fiscal Quarter), a consolidated balance sheet of the Lead Borrower
and its Subsidiaries as at the end of such Fiscal Month, and the related
consolidated statements of income or operations, Shareholders’ Equity and cash
flows for such Fiscal Month, and for the portion of the Lead Borrower's Fiscal
Year then ended, setting forth in each case in comparative form the figures for
(A) the corresponding Fiscal Month of the previous Fiscal Year and (B) the
corresponding portion of the previous Fiscal Year, all in reasonable detail,
such consolidated statements to be

        

        
          
            
            

          

          
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        certified by a Responsible Officer of the Lead Borrower as fairly
presenting the financial condition, results of operations, Shareholders’ Equity
and cash flows of the Lead Borrower and its Subsidiaries as of the end of such
Fiscal Month in accordance with GAAP, subject only to normal year-end audit
adjustments and the absence of footnotes;

        

        (d)           as
soon as available, but in any event not more than 60 days after the end of each
Fiscal Year of the Lead Borrower, forecasts prepared by management of the Lead
Borrower, in form reasonably satisfactory to the Administrative Agent, of
consolidated balance sheets and statements of income or operations and cash
flows of the Lead Borrower and its Subsidiaries, as well as projected
Availability, on a monthly basis for the immediately following Fiscal Year
(including the Fiscal Year in which the Maturity Date occurs), and as soon as
available, any significant revisions to such forecast with respect to such
Fiscal Year.

        

        The
Administrative Agent and the Lenders acknowledge and agree that notwithstanding
the allotted time periods for monthly delivery of financial statements and
Compliance Certificates set forth in Section 6.01(c) and Section 6.02(b), the
time periods for delivering such financial statements and Compliance Certificates
for the months of April and May of each Fiscal Year shall be extended by 30 days
for April and 15 days for May (each an "Extension Period");
provided that no prepayment of Indebtedness, Acquisition, Restricted Payment,
Investment or other transaction or payment permitted hereunder based upon a
calculation of Consolidated Fixed Charge Coverage Ratio or Consolidated Adjusted
Fixed Charge Coverage Ratio shall be permitted during any Extension Period if
the applicable financial statements and Compliance Certificates for such periods
have not been delivered.

        

        6.02        Certificates;
Other Information.
Deliver to the Administrative Agent, in form and detail reasonably
satisfactory to the Administrative Agent:

        

        (a)           concurrently
with the delivery of the financial statements referred to in Section 6.01(a) and (b), (i) a duly
completed Compliance Certificate signed by a Responsible Officer of the Lead
Borrower which (among other things) includes a detailed calculation of the
Consolidated Fixed Charge Coverage Ratio (regardless of whether a Fixed Charge
Trigger Period exists), (ii) a certificate setting forth any change in generally
accepted accounting principles used in the preparation of such financial
statements and (iii) and a copy of management’s discussion and analysis with
respect to such financial statements; provided, that (x)
upon the occurrence of any event giving rise to a Fixed Charge Trigger Period or
a Trigger Period, if no Compliance Certificate has been delivered thirty (30) or
fewer days prior to such commencement date, the Lead Borrower immediately shall
deliver to the Administrative Agent a Compliance Certificate signed by a
Responsible Officer of the Lead Borrower which (among other things) shall
include a detailed calculation of the Consolidated Fixed Charge Coverage Ratio
as of the most recently ended Measurement Period (each, a “Trigger Period Compliance
Certificate”) and (y) thereafter during any Fixed Charge Trigger Period
or Trigger Period, the Lead Borrower shall deliver to the Administrative Agent,
as soon as available but in any event within 30 days after the end of each
Fiscal Month, a Trigger Period Compliance Certificate;

        

        (b)           on
the 15th day of
each Fiscal Month (or, if such day is not a Business Day, on the next succeeding
Business Day) or such later Business Day as the Administrative Agent may agree
in its reasonable discretion but not beyond the 20th day of
any such Fiscal Month, a certificate in the form of Exhibit F (a "Borrowing Base
Certificate") showing the Borrowing Base as of the close of business as
of the last day of the immediately preceding Fiscal Month, each Borrowing Base
Certificate to be certified as complete and correct by a Responsible Officer of
the Lead Borrower; provided that during
any Trigger Period, such Borrowing Base Certificate shall be delivered no later
than the third Business Day (or, if agreed by the Administrative
Agent

        

        
          
            
            

          

          
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        in its reasonable discretion, the fourth Business Day) of each week;
provided
further that upon consummation of any Permitted Disposition of any Eligible Real
Estate or Eligible Inventory (other than sales of Inventory in the ordinary
course of business), in each case, constituting a Prepayment Event, upon request
of the Administrative Agent, the Lead Borrower shall promptly furnish an updated
Borrowing Base Certificate reflecting the Borrowing Base after giving effect to
such Disposition;

        

        (c)           no
more than ten (10) Business Days after receipt thereof, copies of any detailed
audit reports, final management letters or recommendations submitted to the
board of directors (or the audit committee of the board of directors) of any
Loan Party by its Registered Public Accounting Firm in connection with the
accounts or books of the Loan Parties or any Subsidiary, or any audit of any of
them, including, without limitation, specifying any Internal Control
Event;

        

        (d)           promptly
upon the filing thereof, copies of each annual report, proxy or financial
statement or other report or communication sent to the stockholders of the Loan
Parties, and copies of all annual, regular, periodic and special reports and
registration statements which any Loan Party may file or be required to file
with the SEC under Section 13 or 15(d) of the Securities Exchange Act of 1934 or
with any national securities exchange, and in any case not otherwise required to
be delivered to the Administrative Agent pursuant hereto;

        

        
          (e)         
[reserved];

        

        

        (f)           upon
the renewal of any insurance policy of the Loan Parties, evidence of insurance
reasonably satisfactory to the Collateral Agent, summarizing the insurance
coverage (specifying type, amount and carrier) in effect for each Loan Party and
its Subsidiaries, and as soon as available, but in any event within 30 days
after such renewal, a certificate of such insurance coverage;

        

        (g)           promptly,
and in any event within five Business Days after receipt thereof by any Loan
Party or any Subsidiary thereof, copies of each notice or other correspondence
received from any Governmental Authority (including, without limitation, the SEC
(or comparable agency in any applicable non-U.S. jurisdiction)) concerning any
proceeding with, or investigation or possible investigation or other inquiry by
such Governmental Authority regarding financial or other operational results of
any Loan Party or any Subsidiary thereof or any other matter which, if adversely
determined, could reasonably expected to have a Material Adverse
Effect;

        

        (h)           promptly,
such additional information regarding the business affairs, financial condition
or operations of any Loan Party or any Subsidiary, or compliance with the terms
of the Loan Documents, as the Administrative Agent or any Lender may from time
to time reasonably request; and

        

        (i)           no
less than five (5) Business Days prior to making any Permitted Tax Distribution,
written notice regarding the Tax Distribution Amount (including any statements
and calculations prepared or delivered in accordance with Section 2.04 of the
BNCB Purchase Agreement).

        

        Documents
required to be delivered pursuant to Section 6.01(a),
(b), or (c) or Section 6.02(c) (to
the extent any such documents are included in materials otherwise filed with the
SEC) may be delivered electronically and if so delivered, shall be deemed to
have been delivered on the date (i) on which the Lead Borrower posts such
documents, or provides a link thereto on the Lead Borrower’s website on the
Internet at the website address listed on Schedule 10.02; or
(ii) on which such documents are posted on

        

        
          
            
            

          

          
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        the Lead Borrower’s behalf at www.sec.gov
or otherwise on an Internet or intranet website, if any, in each case to which
each Lender and the Administrative Agent have access (whether a commercial,
third- party website or whether sponsored by the Administrative Agent); provided that, the
Lead Borrower shall notify the Administrative Agent and each Lender (by
telecopier or electronic mail) of the posting of any such documents and provide
to the Administrative Agent by electronic mail electronic versions of such
documents. The Administrative Agent shall have no obligation to request the
delivery or to maintain copies of the documents referred to above, and in any
event shall have no responsibility to monitor compliance by the Loan Parties
with any such request for delivery, and each Lender shall be solely responsible
for requesting delivery to it or maintaining its copies of such
documents.

        

        The Loan
Parties hereby acknowledge that (a) the Administrative Agent and/or the Arranger
will make available to the Lenders and the LC Issuer materials and/or
information provided by or on behalf of the Loan Parties hereunder
(collectively, "Borrower Materials")
by posting the Borrower Materials on IntraLinks or another similar electronic
system (the "Platform") and (b)
certain of the Lenders may be "public-side" Lenders (i.e., Lenders that do
not wish to receive material non-public information with respect to the Loan
Parties or their securities) (each, a "Public Lender"). The
Loan Parties hereby agree that they will use commercially reasonable efforts to
identify that portion of the Borrower Materials that may be distributed to the
Public Lenders and that (w) all such Borrower Materials shall be clearly and
conspicuously marked "PUBLIC" which, at a minimum, shall mean that the word
"PUBLIC" shall appear prominently on the first page thereof; (x) by marking
Borrower Materials "PUBLIC," the Loan Parties shall be deemed to have authorized
the Administrative Agent, the Arranger, the LC Issuer and the Lenders to treat
such Borrower Materials as not containing any material non-public information
(although it may be sensitive and proprietary) with respect to the Loan Parties
or their securities for purposes of United States Federal and state securities
laws (provided,
however, that
to the extent such Borrower Materials constitute Information, they shall be
treated as set forth in Section 10.07); (y)
all Borrower Materials marked "PUBLIC" are permitted to be made available
through a portion of the Platform designated "Public Investor"; and (z) the
Administrative Agent and the Arranger shall be entitled to treat any Borrower
Materials that are not marked "PUBLIC" as being suitable only for posting on a
portion of the Platform not designated "Public Investor."

        

        6.03       Notices. Promptly, unless expressly indicated
otherwise, notify the Administrative Agent:

        

        (a)           of
the occurrence of (i) any Specified Default and (ii) upon a Responsible Officer
obtaining actual knowledge thereof, any Default other than a Specified
Default;

        

        (b)           immediately
upon obtaining actual knowledge thereof, any other Trigger Event or Fixed Charge
Trigger Event;

        

        (c)           of
any matter that has resulted or could reasonably be expected to result in a
Material Adverse Effect, including (i) breach or non-performance of, or any
default under, a Material Contract or with respect to Material Indebtedness of
any Loan Party or any Subsidiary thereof; (ii) any material dispute, litigation,
investigation, proceeding or suspension between any Loan Party or any Subsidiary
thereof and any Governmental Authority; or (iii) the commencement of, or any
material development in, any material litigation or proceeding affecting any
Loan Party or any Subsidiary thereof, including pursuant to any applicable
Environmental Laws;

        

        
          (d)        
of
the occurrence of any ERISA Event;

        

        

        
          
            
            

          

          
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        (e)           any
Disposition of Collateral or issuance of any Equity Interests that could
reasonably be expected to give rise to a mandatory prepayment under Section
2.05(e);

        

        (f)           any
material change in accounting policies or financial reporting practices by any
Loan Party or any Subsidiary thereof;

        

        (g)           of
the Public Accountants’ determination (in connection with its preparation of its
report under Section
6.01(a))or the Lead Borrower's determination of the occurrence or
existence of any Internal Control Event ;

        

        
          (h)         
of
the formation or acquisition of any Subsidiary;

        

        

        (i)           of
any change in the name, corporate form or state of organization of any Loan
Party or any change in the name or names under which any Loan Party’s Business
is transacted

        

        (j)           immediately
upon receipt of notice thereof, of the filing of any Lien against any Loan Party
for unpaid Taxes against any material portion of the Collateral;

        

        (k)           of
any casualty or other insured damage to any material portion of the Collateral
or the commencement of any action or proceeding for the taking of any interest
in a material portion of the Collateral under power of eminent domain or by
condemnation or similar proceeding or if any material portion of the Collateral
is damaged or destroyed; and

        

        (l)           of
any notice of any material non-compliance with applicable Laws with respect to
any “Property” (as defined in any Mortgages relating to Eligible Real Estate)
which it receives or any pending proceedings in respect thereof.

        

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

        

        6.04       Payment
of Obligations.
Pay and discharge as the same shall become due and payable, all its obligations and
liabilities, including (a) all tax liabilities, assessments and governmental
charges or levies upon it or its properties or assets, (b) all lawful claims
(including, without limitation, claims of landlords, warehousemen, customs
brokers, and carriers) which, if unpaid, would by law become a Lien upon its
property (other than Permitted Encumbrances); and (c) all Material Indebtedness,
as and when due and payable, but subject to any subordination provisions
contained in any instrument or agreement evidencing such Material Indebtedness,
except, in each case, where (i) the validity or amount thereof is being
contested in good faith by appropriate proceedings, (ii) such Loan Party has set
aside on its books adequate reserves with respect thereto in accordance with
GAAP, (iii) such contest effectively suspends collection of the contested
obligation and enforcement of any Lien securing such obligation, (iv) no Lien
(other than Permitted Encumbrances) has been filed with respect thereto and (iv)
the failure to make payment pending such contest could not reasonably be
expected to result in a Material Adverse Effect. Nothing contained herein shall
be deemed to limit the rights of the Administrative Agent with respect to
establishing Reserves pursuant to this Agreement.

        

        6.05       Preservation
of Existence, Etc. (a) Preserve, renew and maintain in full force and
effect its legal
existence and good standing under the Laws of the jurisdiction of its
organization or formation except in a transaction permitted by Section 7.04 or 7.05; (b) take all
reasonable action to maintain all

        

        
          
            
            

          

          
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        rights, privileges, permits, licenses and franchises necessary or
desirable in any material respect in the normal conduct of its business, except
to the extent that failure to do so could not reasonably be expected to have a
Material Adverse Effect; and (c) take all reasonable action to maintain all
existing registrations of its Intellectual Property, except to the extent the
failure to do so could not reasonably be expected to have a Material Adverse
Effect or such Intellectual Property is no longer used or useful in the conduct
of the business of the Loan Parties.

        

        6.06        Maintenance
of Properties. (a) Maintain (except for any maintenance required to
be performed by the
landlord, lessor or other property owner under any applicable Lease), preserve
and protect all of its material properties and equipment necessary in the
operation of its business in good working order and condition, ordinary wear and
tear excepted except where the failure to do so could not reasonably be expected
to have a Material Adverse Effect and (b) make all necessary repairs thereto and
renewals and replacements thereof (except for any repairs, renewals or
replacements required to be made by the landlord, lessor or other property owner
under any applicable Lease) except where the failure to do so could not
reasonably be expected to have a Material Adverse Effect.

        

        6.07        Maintenance
of Insurance.
Maintain with financially sound and reputable insurance companies not Affiliates
of the Loan Parties (other than a Permitted Self-Insurance Program), reasonably
acceptable to the Administrative Agent, insurance with respect to its properties
and business against loss or damage of the kinds customarily insured against by
Persons engaged in the same or similar business and operating in the same or
similar locations or as is required by applicable Law, of such types and in such
amounts (after giving effect to any self-insurance compatible with the following
standards) as are customarily carried under similar circumstances by such other
Persons and as are reasonably acceptable to the Administrative
Agent.

        

        (a)           Fire
and extended coverage policies maintained with respect to any Collateral shall
be endorsed or otherwise amended to include (i) a non-contributing mortgage
clause (regarding improvements to real property) and lenders’ loss payable
clause (regarding personal property), in form and substance satisfactory to the
Collateral Agent, which endorsements or amendments shall provide that the
insurer shall pay all proceeds otherwise payable to the Loan Parties under the
policies directly to the Collateral Agent (and the Collateral Agent agrees,
unless a Trigger Event is then continuing or the proceeds are required to be
applied to the Obligations in accordance with Section 2.05(c) or
2.05(e), to
deliver such insurance proceeds as the Lead Borrower may direct), (ii) a
provision to the effect that none of the Loan Parties, Credit Parties or any
other Person shall be a co-insurer and (iii) such other provisions as the
Collateral Agent may reasonably require from time to time to protect the
interests of the Credit Parties. Commercial general liability policies shall be
endorsed to name the Collateral Agent as an additional insured. Business
interruption policies shall name the Collateral Agent as a loss payee and shall
be endorsed or amended to include (i) a provision that, from and after the
Closing Date, the insurer shall pay all proceeds otherwise payable to the Loan
Parties under the policies directly to the Collateral Agent (and the Collateral
Agent agrees, unless a Trigger Event is then continuing or the proceeds are
required to be applied to the Obligations in accordance with Section 2.05(c) or
2.05(e), to
deliver such insurance proceeds as the Lead Borrower may direct), (ii) a
provision to the effect that none of the Loan Parties, the Administrative Agent,
the Collateral Agent or any other party shall be a co-insurer and (iii) such
other provisions as the Collateral Agent may reasonably require from time to
time to protect the interests of the Credit Parties. Each such policy referred
to in this Section
6.07(b) shall also provide that it shall not be canceled, modified or not
renewed (i) by reason of nonpayment of premium except upon not less than ten
(10) days’ prior written notice thereof by the insurer to the Collateral Agent
(giving the Collateral Agent the right to cure defaults in the payment of
premiums) or (ii) for any other reason except upon not less than thirty (30)
days’ prior written notice thereof by the insurer to the Collateral Agent. The
Lead Borrower shall deliver to the Collateral Agent, prior to the cancellation,
modification or non-renewal of any such policy of insurance, a copy of a renewal
or replacement policy (or other evidence of renewal of a

        

        
          
            
            

          

          
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        policy previously delivered to the Collateral Agent, including an
insurance binder) together with evidence reasonably satisfactory to the
Collateral Agent of payment of the premium therefor.

        

        (b)           None
of the Credit Parties, or their agents or employees shall be liable for any loss
or damage insured by the insurance policies required to be maintained under this
Section 6.07.
Each Loan Party shall look solely to its insurance companies or any other
parties other than the Credit Parties for the recovery of such loss or damage
and such insurance companies shall have no rights of subrogation against any
Credit Party or its agents or employees. If, however, the insurance policies do
not provide waiver of subrogation rights against such parties, as required
above, then the Loan Parties hereby agree, to the extent permitted by law, to
waive their right of recovery, if any, against the Credit Parties and their
agents and employees. The designation of any form, type or amount of insurance
coverage by the any Credit Party under this Section 6.07 shall in
no event be deemed a representation, warranty or advice by such Credit Party
that such insurance is adequate for the purposes of the business of the Loan
Parties or the protection of their properties.

        

        (c)           Maintain
for themselves and their Subsidiaries, a Directors and Officers insurance
policy, and a "Blanket Crime" policy including employee dishonesty, forgery or
alteration, theft, disappearance and destruction, robbery and safe burglary,
property, and computer fraud coverage with responsible companies in such amounts
as are customarily carried by business entities engaged in similar businesses
similarly situated, and will upon request by the Administrative Agent furnish
the Administrative Agent certificates evidencing renewal of each such
policy.

        

        (d)           If
at any time the area in which any Eligible Real Estate is located is designated
(i) a "flood hazard area" in any Flood Insurance Rate Map published by the
Federal Emergency Management Agency (or any successor agency), obtain flood
insurance in an amount and form that complies with the requirements under the
National Flood Insurance Act, or (ii) a "Zone 1" area, obtain earthquake
insurance in such total amount as is reasonable and customary for companies
engaged in the Business.

        

        (e)          Permit
any representatives that are designated by the Collateral Agent to inspect the
insurance policies maintained by or on behalf of the Loan Parties and to inspect
books and records related thereto and any properties covered thereby, all at the
Loan Parties’ expense.

        

        6.08       Compliance
with Laws. Comply
in all material respects with the requirements of all Laws and all orders,
writs, injunctions and decrees applicable to it or to its business or property,
except in such instances in which (a) such requirement of Law or order, writ,
injunction or decree is being contested in good faith by appropriate proceedings
diligently conducted and with respect to which adequate reserves have been set
aside and maintained by the Loan Parties in accordance with GAAP; (b) such
contest effectively suspends enforcement of the contested Laws; and (c) the
failure to comply therewith could not reasonably be expected to have a Material
Adverse Effect.

        

        
          6.09    
  Books and
Records; Accountants.

        

        

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

        

        

        
          
            
            

          

          
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        (b)           At
all times, retain a Registered Public Accounting Firm which is reasonably
satisfactory to the Administrative Agent and permit such Registered Public
Accounting Firm to discuss the Loan Parties’ financial performance, financial
condition, operating results, controls, and such other matters, within the scope
of the retention of such Registered Public Accounting Firm, as may be raised by
the Administrative Agent, provided that the
Lead Borrower shall be given reasonable opportunity to be present and at
participate in any such discussions between the Administrative Agent and the
Registered Accounting Firm.

        

        
          6.10       
Inspection
Rights.

        

        

        (a)           Permit
representatives and independent contractors of the Administrative Agent to visit
and inspect any of its properties, to examine its corporate, financial and
operating records, and make copies thereof or abstracts therefrom, and to
discuss its affairs, finances and accounts with its directors, officers, and
Registered Public Accounting Firm (once in any 12 month period or, during any
Trigger Period, at the Administrative Agent’s reasonable discretion), all at the
expense of the Loan Parties and at such reasonable times during normal business
hours, upon reasonable advance notice to the Lead Borrower; provided, however, that during
a Trigger Period, the Administrative Agent (or any of its representatives or
independent contractors) may do any of the foregoing at the expense of the Loan
Parties at any time during normal business hours and without advance
notice.

        

        (b)           After
reasonable prior notice from the Administrative Agent, permit the Administrative
Agent or professionals (including investment bankers, consultants, accountants,
lawyers and appraisers) retained by the Administrative Agent to conduct
appraisals, commercial finance examinations and other evaluations, including,
without limitation, of (i) the Lead Borrower’s practices in the computation of
the Borrowing Base, (ii) the personal property included in the Borrowing Base
and related financial information such as, but not limited to, sales, gross
margins, payables, accruals and reserves and (iii) the Real Estate included in
the Borrowing Base and related financial information and Environmental
Assessments. The Loan Parties shall pay the reasonable and documented fees and
out-of-pocket expenses of the Administrative Agent or such professionals for
such evaluations and appraisals (A) with respect to (b)(i) and (ii) above (1)
other than during a Trigger Period, two (2) appraisals of the Loan Parties’
Inventory and two (2) commercial finance examinations during any calendar year
and (2) during a Trigger Period, three (3) appraisals of the Loan Parties’
Inventory and three (3) commercial finance examinations during the calendar year
in which such Trigger Period arose, and (B) with respect to (b)(iii) above, if
Real Estate is then included in the Borrowing Base, up to one (1) such appraisal
of such Eligible Real Estate during any calendar year, (C) all other commercial
finance examinations and appraisals with respect to the Collateral (other than
Real Estate) and up to one additional appraisal with respect to Eligible Real
Estate, in each case undertaken at any time at the request of the Administrative
Agent if required by applicable Law and (D) all commercial finance examinations
and appraisals deemed necessary by the Administrative Agent and undertaken at
the request of the Administrative Agent after the occurrence and the
continuation of an Event of Default.

        

        (c)           Permit
the Administrative Agent, from time to time, to engage an independent engineer
or other qualified environmental consultant or expert, reasonably acceptable to
the Administrative Agent, at the reasonable expense of the Loan Parties, to
undertake Phase I environmental site assessments during the term of this
Agreement of the Eligible Real Estate, provided that such assessments may only
be undertaken (i) during the continuance of an Event of Default, or (ii) if a
Loan Party receives any notice or obtains knowledge of (A) any potential or
known  material release of any Hazardous Materials at or from any
Eligible Real Estate,

        

        
          
            
            

          

          
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        notification of which release must be given to any Governmental
Authority under any Environmental Law, or notification of which has, in fact,
been given to any Governmental Authority, or (B) any material complaint, order,
citation or notice with regard to air emissions, water discharges, exposure to
Hazardous Materials, or any other environmental or health or safety exposure
matter affecting any Loan Party or any Eligible Real Estate from any Person
(including, without limitation, the U.S. Environmental Protection Agency).
Environmental assessments may include detailed visual inspections of the
Eligible Real Estate, including, without limitation, any and all storage areas,
storage tanks, drains, dry wells and leaching areas, as well as such other
non-invasive investigations or analyses as are reasonably necessary for a
determination of the compliance of the Eligible Real Estate and the use and
operation thereof with all applicable Environmental Laws; provided, however, that the
scope of any assessment undertaken under this provision shall be limited to that
which is necessary to investigate the release, complaint, order, citation or
notice which prompted the assessment. The Borrowers will, and will cause each of
their Subsidiaries to, cooperate with the Administrative Agent and such third
parties to enable such assessment to be timely completed in a manner reasonably
satisfactory to the Administrative Agent, provided such assessment shall not
unreasonably interfere with the ordinary business operations of the Loan
Parties, their Subsidiaries or the Eligible Real Property.

        

        6.11        Use of
Proceeds. Use the proceeds of the Credit Extensions (a) to finance the
BNCB Acquisition,
(b) to refinance the Indebtedness of the Lead Borrower and its Subsidiaries
under the Existing Credit Agreement, (c) to finance the acquisition of working
capital assets of the Borrowers, including Permitted Acquisitions and the
purchase of inventory and equipment, in each case in the ordinary course of
business, (d) to finance Capital Expenditures of the Borrowers, and (e) for
general corporate purposes of the Loan Parties, in each case to the extent
permitted under applicable Law and the Loan Documents.

        

        
          6.12        Additional
Loan Parties; Additional Collateral; Further
Assurances.

        

        

        (a)           Each
Loan Party shall cause (i) each of its Domestic Subsidiaries (other than any
Immaterial Subsidiary (except as otherwise provided in paragraph (e) of this
Section 6.12))
formed or acquired after the date of this Agreement in accordance with the terms
of this Agreement and (ii) any Domestic Subsidiary that was an Immaterial
Subsidiary but, as of the end of the most recently ended fiscal quarter of the
Lead Borrower has ceased to qualify as an Immaterial Subsidiary, to become a
Borrower (an "Additional Borrower")
within 15 days thereafter by executing a Joinder Agreement and simultaneously
therewith grant Liens to the Collateral Agent, for the benefit of the Secured
Parties in any property (subject to the limitations with respect to Real Estate
set forth in paragraph (e) of this Section 6.12 and any other
limitations set forth in the Security Agreement) of such Additional Borrower
which would
constitute Collateral if such Additional Borrower were already a Borrower party
hereto, on such terms as may be required pursuant to the terms of the Collateral
Documents. No Collateral of any Additional Borrower shall be considered for
inclusion in the Borrowing Base until completion of a field examination and
appraisal with results reasonably satisfactory to the Administrative
Agent

        

        (b)           Without
limiting the foregoing but subject to the limitations with respect to Real
Estate set forth in paragraph (e) of this Section 6.12, each
Loan Party will, and will cause each Subsidiary that is a Loan Party to, execute
and deliver, or cause to be executed and delivered, to the Collateral Agent such
documents, agreements and instruments, and will take or cause to be taken such
further actions (including the filing and recording of financing statements,
fixture filings, mortgages, deeds of trust and other documents and such other
actions or deliveries of the type required by Section 4.01, as
applicable, and, if the Borrowers request, in their discretion and subject to
satisfaction of the Real Estate Eligibility Requirements, to include any Real
Estate in the Borrowing Base, including the delivery of the Mortgage Related
Documents with respect to all such Real Estate), which may be required by law or
which the

        

        
          
            
            

          

          
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        Administrative Agent or the Required Lenders may, from time to
time, reasonably request to carry out the terms and conditions of this Agreement
and the other Loan Documents and to ensure perfection and priority of the Liens
created or intended to be created by the Security Documents, all at the expense
of the Loan Parties, it being agreed that no Collateral Access Agreements shall
be required to be furnished with respect to leased Real Estate used as retail
stores.

        

        (c)           Subject
to the limitations set forth or referred to in this Section 6.12, if any
material personal property of the type constituting Collateral hereunder or
under the Security Documents is acquired by any Loan Party after the Effective
Date (other than assets constituting Collateral under the Security Documents
that become subject to the Lien in favor of the Agent upon acquisition thereof),
or if the Borrowers elect, in their discretion and subject to satisfaction of
the Real Estate Eligibility Requirements, to include any Real Estate in the
Borrowing Base, the Lead Borrower will notify the Administrative Agent thereof,
and, if requested by the Administrative Agent, the Lead Borrower will cause such
assets to be subjected to a Lien securing the Secured Obligations and will take,
and cause the other Loan Parties, such actions as shall be necessary or
reasonably requested by Administrative Agent to grant and perfect such Liens,
including actions described in paragraph (b) of this Section, all at the expense
of the Loan Parties (provided that the
cost of perfecting such Lien is not unreasonable in relation to the benefits to
the Lenders of the security afforded thereby in the Administrative Agent’s
reasonable business judgment after consultation with the Lead
Borrower).

        

        (d)           If,
at any time and from time to time after the Effective Date, Subsidiaries that
are not Loan Parties because they are Immaterial Subsidiaries comprise in the
aggregate more than 5.0% of consolidated total assets as of the end of the most
recently ended fiscal quarter of the Lead Borrower or more than 5.0% of gross
revenue for the period of four consecutive fiscal quarters as of the end of the
most recently ended fiscal quarter of the Lead Borrower, then the Lead Borrower
shall, not later than 45 days after the date by which financial statements for
such quarter are required to be delivered pursuant to this Agreement (or such
longer period not to exceed 60 days after such date as may be agreed to by the
Administrative Agent in its reasonable discretion), cause one or more such
Subsidiaries to become Borrowers (notwithstanding that such Subsidiaries are,
individually, Immaterial Subsidiaries) such that the foregoing condition ceases
to be true.

        

        (e)           Notwithstanding
anything to the contrary in this Section 6.12, no Real
Estate shall be required to be subject to a Mortgage unless the Borrowers elect,
in their discretion and subject to satisfaction of the Real Estate Eligibility
Requirements, to include such Real Estate in the Borrowing Base.

        

        (f)           Notwithstanding
anything to the contrary contained herein, the Loan Parties shall not be
required to include as Collateral any Excluded Assets unless the holders of any
Permitted Senior Debt request a second priority Lien upon the existing
Collateral, in which case the Loan Parties shall grant to the Collateral Agent,
for the benefit of the Credit Parties, a second priority Lien in and to the
Excluded Assets pursuant to an intercreditor agreement and/or Security Documents
acceptable to the Agents and the Required Lenders.

        

        (g)           In
no event shall compliance with this Section 6.12 waive or
be deemed a waiver or Consent to any transaction giving rise to the need to
comply with this Section 6.12 if such
transaction was not otherwise expressly permitted by this Agreement or
constitute or be deemed to constitute, with respect to any Subsidiary, an
approval of such Person as a Borrower or permit the inclusion of any acquired
assets in the computation of the Borrowing Base.

        

        
          
            
            

          

          
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          6.13      
 Cash
Management.

        

        

        
          (a)          
Deliver
to the Administrative Agent:

        

        

        (i)           on
or prior to the Closing Date (or such later date, not later than 90 days after
the Closing Date, as the Administrative Agent, in its sole discretion, may agree
in writing prior to the Closing Date), copies of notifications (each, a "DDA Notification")
substantially in the form attached hereto as Exhibit K which have
been executed on behalf of such Loan Party with respect to each depository
institution listed on Schedule
5.21(a);

        

        (ii)           on
or prior to the Closing Date (or such later date, not later than 90 days after
the Closing Date, as the Administrative Agent, in its sole discretion, may agree
in writing prior to the Closing Date), copies of notifications (each, a "Credit Card
Notification") substantially in the form attached hereto as Exhibit L which have
been executed on behalf of such Loan Party with respect to such Loan Party’s
credit card clearinghouses and processors listed on Schedule
5.21(b);

        

        (iii)           on
or prior to the Closing Date (or such later date, not later than 90 days after
the Closing Date, as the Administrative Agent, in its sole discretion, may agree
in writing prior to the Closing Date), a fully executed Blocked Account
Agreement with respect to the Concentration Account identified as of the Closing
Date; and

        

        (iv)           on
or prior to the date that occurs 90 days after the Closing Date, fully executed
Blocked Account Agreement satisfactory in form and substance to the Agents with
each Blocked Account Bank (collectively, the "Blocked Accounts")
identified by the Agents.

        

        Each DDA
Notification and Credit Card Notification shall be held by the Administrative
Agent until the occurrence of a Trigger Event. After the occurrence and during
the continuance of a Trigger Event, the Administrative Agent may (and, at the
request of the Required Lenders, shall) deliver each such DDA Notification and
Credit Card Notification to the applicable depository institution and credit
card processor.

        

        (b)           The
Loan Parties shall transfer by ACH or wire transfer no less frequently than
daily (and whether or not there are then any outstanding Secured Obligations) to
a Blocked Account all amounts on deposit in each such DDA (provided that such
covenant shall not apply to (i) minimum balances as may be required to be kept
in the subject DDA by the depository institution at which such DDA is maintained
or (ii) if greater, any amounts maintained by the Loan Parties in such DDAs (and
other DDAs, with the consent of the Collateral Agent, not to be unreasonably
withheld) in the ordinary course of business consistent with the past practice)
and all payments due from credit card processors.

        

        (c)           During
any Trigger Period, with respect to Blocked Accounts of any Loan Party other
than the BNCB Loan Parties, each Blocked Account Agreement (other than with
respect to any BNCB Blocked Account) shall require the transfer by ACH or wire
transfer no less frequently than daily (and whether or not there are then any
outstanding Secured Obligations) to one of the concentration accounts designated
by the Administrative Agent (collectively, the "Concentration
Accounts"), of all cash receipts and collections, including, without
limitation, the following:

        

        
          (i)       
 all
available cash receipts from the sale of Inventory and other
Collateral;

        

        

        
          (ii)        all
proceeds of collections of Accounts;

        

        

        
          
            
            

          

          
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        (iii)      all Net Proceeds, and all other
cash payments received by a Loan Party from any Person or from any source or on
account of any sale or other transaction or event, including, without
limitation, any Prepayment Event;

        

        
          (iv)      
the
proceeds of all credit card charges;

        

        

        (v)           the
then contents of each DDA (net of any minimum balance, not to  exceed
the Maximum DDA Balance, as may be required to be kept in the subject DDA by the
depository institution at which such DDA is maintained).

        

        (d)           During
any BNCB Standstill Period with respect to any BNCB Party, (i) the Blocked
Account Agreement with respect to each applicable BNCB Blocked Account shall not
require any transfer of any cash receipts or collections, and (ii) each BNCB
Loan Party covenants and agrees to transfer to a Concentration Account by ACH or
wire transfer no less frequently than daily all amounts on deposit in each such
BNCB Blocked Account in excess of amounts that BNCB reasonably deems to be
necessary to satisfy projected buy-back obligations under the Permitted Buy-Back
Program at each Store. In addition to inspection rights permitted under Section 6.10, the
Administrative Agent shall have the right, upon reasonable prior notice to the
Lead Borrower, to audit and or evaluate, or to cause professionals retained by
the Administrative Agent to audit and/or evaluate, BNCB’s compliance with this
Section
6.13(d), and the Loan Parties shall pay the reasonable and documented
expenses of the Administrative Agent or such professionals for such audits and
evaluations.

        

        (e)           If
the Borrowers fail to maintain Availability of at least sixteen percent (16.0%)
of the Loan Cap at any time, then the Borrowers covenant and agree that the BNCB
Loan Parties will establish one or more special operating accounts (“BNCB Trigger Period
Accounts”) that can only be funded with Borrowings of Committed Loans in
accordance with clause (g) of this Section
6.13.

        

        (f)           During
any BNCB Trigger Period, each BNCB Blocked Account Agreement shall require the
transfer by ACH or wire transfer no less frequently than daily (and whether or
not there are then any outstanding Secured Obligations) to a Concentration
Account of all cash receipts and collections, including, without limitation, the
following:

        

        
          (i)          
all
available cash receipts from the sale of Inventory and other
Collateral;

        

        

        
          (ii)         
 all
proceeds of collections of Accounts;

        

        

        (iii)          all
Net Proceeds, and all other cash payments received by a Loan Party from any
Person or from any source or on account of any sale or other transaction or
event, including, without limitation, any Prepayment Event;

        

        
          (iv)        
the
proceeds of all credit card charges;

        

        

        (v)           the
then contents of each DDA (net of any minimum balance, not to exceed the Maximum
DDA Balance, as may be required to be kept in the subject DDA by the depository
institution at which such DDA is maintained).

        

        (g)           During
any BNCB Trigger Period, Borrowings of Committed Loans may be deposited in BNCB
Trigger Period Accounts and the amounts on deposit in such BNCB Trigger Period
Accounts may only be applied to fund Permitted Buy-Back Programs or, upon the
expiration of the applicable Permitted Buy-Back Programs or the occurrence of an
Event of Default, to the prepayment of the Obligations then outstanding under
and in accordance with the Credit Agreement; provided,
that,

        

        
          
            
            

          

          
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        except as otherwise provided in Section 8.03, upon
payment in full of such outstanding Obligations, any remaining amounts will be
released and transferred to a deposit account of the BNCB Loan Parties as the
Lead Borrower shall direct.

        

        (h)           The
Concentration Account shall at all times be under the sole dominion and control
of the Collateral Agent. The Loan Parties hereby acknowledge and agree that (i)
the Loan Parties have no right of withdrawal from the Concentration Account,
(ii) the funds on deposit in the Concentration Account shall at all times be
collateral security for all of the Secured Obligations and (iii) the funds on
deposit in the Concentration Account shall be applied as provided in this
Agreement. In the event that, notwithstanding the provisions of this Section 6.13, any
Loan Party receives or otherwise has dominion and control of any such proceeds
or collections, such proceeds and collections shall be held in trust by such
Loan Party for the Administrative Agent, shall not be commingled with any of
such Loan Party’s other funds or deposited in any account of such Loan Party and
shall, not later than the Business Day after receipt thereof, be deposited into
the Concentration Account or dealt with in such other fashion as such Loan Party
may be instructed by the Administrative Agent. During the continuation of a
Trigger Event, the amounts deposited into the Concentration Account shall be
applied to the prepayment of the Obligations then outstanding; provided, that,
except as otherwise provided in Section 8.03, upon
payment in full of such outstanding Obligations, any remaining amounts will be
released and transferred to a deposit account of the Loan Parties as the Lead
Borrower shall direct and the existence of a Trigger Event (other than as a
result of the occurrence of an Event of Default) shall not, in and of itself,
impair the right of the Borrowers to Committed Loans in accordance with the
terms hereof.

        

        (i)           Upon
the request of the Administrative Agent, the Loan Parties shall cause bank
statements and/or other reports to be delivered to the Administrative Agent not
less often than monthly, accurately setting forth all amounts deposited in each
Blocked Account to ensure the proper transfer of funds as set forth
above.

        

        6.14       Information
Regarding the Collateral. Furnish to the Administrative Agent at
least thirty
(30) days (or such shorter period as may be agreed to by the Administrative
Agent in its reasonable discretion) prior written notice of any change in: (i)
any Loan Party’s name or in any trade name used to identify it in the conduct of
its business or in the ownership of its properties; (ii) the location of any
Loan Party’s chief executive office, its principal place of business, and any
office in which it maintains a material portion of its books or records relating
to Collateral owned by it; (iii) any Loan Party’s organizational structure or
jurisdiction of incorporation or formation; or (iv) any Loan Party’s Federal
Taxpayer Identification Number or organizational identification number assigned
to it by its state of organization. For the avoidance of doubt, trade names
shall not include any non “Barnes & Noble” branded college bookstores so
long as no Accounts were created using such other trade names.

        

        
          6.15       
Physical
Inventories.

        

        

        (a) Prior
to an Event of Default, cause one (1) physical inventory to be undertaken in
each twelve month period at the Loan Parties’ Stores, at the expense of the Loan
Parties, and periodic cycle counts at the Loan Parties’ distribution centers, in
each case consistent with past practices, conducted by such inventory takers as
are satisfactory to the Collateral Agent in its Permitted Discretion and
following such methodology as is consistent with the methodology used in the
immediately preceding inventory or as otherwise may be satisfactory to the
Collateral Agent. The Collateral Agent, at the expense of the Loan Parties, may
participate in and/or observe each scheduled physical count of Inventory which
is undertaken on behalf of any Loan Party at any Material Storage Location and
up to eight (8) Stores reasonably selected by the Collateral Agent. The Lead
Borrower, within forty-five (45) days (or such longer period as may be agreed to
by the Collateral Agent in its reasonable discretion) following the fiscal month
in which completion of such inventory occurs, shall provide the Collateral Agent
with a

        

        
          
            
            

          

          
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        reconciliation of the results of such inventory (as well as of any
other physical inventory or cycle counts undertaken by a Loan Party) and shall
post such results to the Loan Parties’ stock ledgers and general ledgers, as
applicable.

        

        (b)           The
Collateral Agent, in its discretion, if any Default exists, may cause additional
such inventories to be taken as the Collateral Agent determines (each, at the
expense of the Loan Parties).

        

        6.16       Environmental
Laws. Except
as could not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect (a) conduct its operations and keep
and maintain its Eligible Real Estate in material compliance with all
Environmental Laws and environmental permits; (b) obtain and renew all
environmental permits necessary for its operations and properties; and (c)
implement any and all investigation, remediation, removal and response actions
that are necessary to maintain the value and marketability of the Eligible Real
Estate or to otherwise comply with Environmental Laws pertaining to any of its
Eligible Real Estate, provided, however, that neither
a Loan Party nor any of its Subsidiaries shall be required to undertake any such
investigation, remediation, removal, response or other action to the extent that
its obligation to do so is being contested in good faith and by proper
proceedings and adequate reserves have been set aside and are being maintained
by the Loan Parties with respect to such circumstances in accordance with
GAAP.

        

        6.17       Compliance
with Terms of Leases. Except as otherwise expressly permitted
hereunder, make
all payments and otherwise perform all obligations in respect of all Leases of
real property to which any Loan Party or any of its Subsidiaries is a party,
keep such Leases in full force and effect and not allow such Leases to lapse or
be terminated or any rights to renew such Leases to be forfeited or cancelled,
notify the Administrative Agent of any default by any party with respect to such
Leases and cooperate with the Administrative Agent in all respects to cure any
such default, and cause each of its Subsidiaries to do so, except, in any case,
where the failure to do so, either individually or in the aggregate, could not
be reasonably likely to have a Material Adverse Effect, provided, however, that the
termination of any Lease by the counterparty pursuant to any right of
termination (other than upon default by any Loan Party) under such Lease shall
not constitute a breach of this covenant.

        

        6.18       Material
Contracts. Perform and observe all the material terms and provisions of
each Material
Contract, other than any Leases, to be performed or observed by it, maintain
each such Material Contract in full force and effect, enforce each such Material
Contract in accordance with its terms, and cause each of its Subsidiaries to do
so, except, in any case, where the failure to do so, either individually or in
the aggregate, could not reasonably be expected to have a Material Adverse
Effect.

        

        6.19       Compliance
with ERISA. Cause, and cause each of its ERISA Affiliates to: (a) maintain
each Pension Plan in compliance in all material respects with the applicable
provisions of ERISA, the Code and other federal or state law; (b) cause each
Pension Plan which is qualified under Section 401(a) of the Code to maintain
such qualification; and (c) make all required contributions to any Pension Plan
subject to Section 412 of the Code.

        

        6.20       Internal
Control Events. Upon notification from the Administrative Agent to the
Lead Borrower
that the Required Lenders require remediation of any Internal Control Event of
which they have received notice pursuant to Section 6.03(g) or as
reported in any report delivered pursuant to Section 6.01(a), remediate or
cause to be remediated such Internal Control Event, and to test and confirm
such remediation,
not later than the end of the time period reasonably agreed by the Required
Lenders with the Lead Borrower as necessary for such remediation (the "Remediation Period").
It is understood that the Remediation Period will require a sufficient period of
time to permit testing required by the relevant Securities Laws.

        

        
          
            
            

          

          
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        ARTICLE VII

        NEGATIVE
COVENANTS

        

        So long
as any Obligation (other than contingent indemnification obligations for which
no claim has been asserted) hereunder shall not be Fully Satisfied, no Loan
Party shall, nor shall it permit any Subsidiary to, directly or
indirectly:

        

        7.01       Liens. Create, incur, assume or
suffer to exist any Lien upon any of its property, assets or revenues, whether now
owned or hereafter acquired or sign or file or suffer to exist under the UCC or
any similar Law or statute of any jurisdiction a financing statement that names
any Loan Party or any Subsidiary thereof as debtor; sign or suffer to exist any
security agreement authorizing any Person thereunder to file such financing
statement; sell any of its property or assets subject to an understanding or
agreement (contingent or otherwise) to repurchase such property or assets with
recourse to it or any of its Subsidiaries; or assign or otherwise transfer any
accounts or other rights to receive income, other than, (i) with respect to any
Eligible Real Estate encumbered by a Mortgage in favor of the Collateral Agent,
the Liens referred to in Schedule B of the Title Policy insuring the Collateral
Agent’s interest under such Mortgage and (ii) as to all of the above, the
following (each of the following, a "Permitted
Encumbrance"):

        

        
          (a)          
Liens
pursuant to any Loan Document;

        

        

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

        

        (c)           Liens
imposed by law for Taxes that are not yet due or are being contested in
compliance with Section
6.04;

        

        (d)           carriers’,
warehousemen’s, mechanics’, materialmen’s, repairmen’s and other like Liens
imposed by applicable Law, arising in the ordinary course of business and
securing obligations that are not overdue by more than thirty (30) days or are
being contested in compliance with Section
6.04;

        

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

        

        
          (f)          
Landlords’
and lessors’ Liens in respect of rent not in default

        

        

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

        

        (h)           Liens
relating to Real Estate consisting of easements, covenants, conditions,
restrictions, building code laws, zoning restrictions, rights-of-way and similar
encumbrances on real property and interests of tenants, subtenants, licensees
and other occupants, only as tenants, subtenants, licensees or other occupants,
as applicable, under any lease, sublease, license agreement, or other occupancy
agreement, in each case, imposed by law or arising in the ordinary course of
business that do not secure any Indebtedness and do not materially detract from
the value of the affected property or materially interfere with the ordinary
conduct of business of a Loan Party and such other minor title

        

        
          
            
            

          

          
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        defects or survey matters that are disclosed by current surveys
that, in each case, do not materially interfere with the current use of the real
property;

        

        (i)           Liens
in respect of judgments for the payment of money that would not constitute an
Event of Default under Section
8.01(h);

        

        (j)           Liens
on fixed or capital assets acquired by any Loan Party which are permitted under
Section 7.03(c)
so long as (i) such Liens and the Indebtedness secured thereby are incurred
prior to or within ninety (90) days after such acquisition, (ii) the
Indebtedness secured thereby does not exceed the cost or fair market value,
whichever is lower, of the property being acquired on the date of acquisition;
and (iii) such Liens shall not extend to any other property or assets of the
Loan Parties;

        

        (k)           possessory
Liens in favor of brokers and dealers arising in connection with the acquisition
or disposition of Investments owned as of the date hereof and Permitted
Investments, provided that such
liens (a) attach only to such Investments and (b) secure only obligations
incurred in the ordinary course and arising in connection with the acquisition
or disposition of such Investments and not any obligation in connection with
margin financing;

        

        
          (l)           
[reserved];

        

        

        
          (m)         
Liens
arising solely by virtue of any statutory or common law provisions relating
to
banker’s liens, liens in favor of securities intermediaries, rights of setoff or
similar rights and remedies as to deposit accounts or securities accounts or
other funds maintained with depository institutions or securities
intermediaries;

        

        

        (n)           Liens
arising from precautionary UCC filings regarding "true" operating leases or, to
the extent permitted under the Loan Documents, the consignment of goods to a
Loan Party;

        

        (o)           voluntary
Liens on property (other than property of the type included in the Borrowing
Base) in existence at the time such property is acquired pursuant to a Permitted
Acquisition or on such property of a Subsidiary of a Loan Party in existence at
the time such Subsidiary is acquired pursuant to a Permitted Acquisition; provided, that such
Liens are not incurred in connection with or in anticipation of such Permitted
Acquisition and do not attach to any other assets of any Loan Party or any
Subsidiary;

        

        (p)           Liens
securing Indebtedness under the Permitted Senior Debt, provided that (i) the
holders of such Indebtedness shall only be granted first priority Liens upon the
Excluded Assets and (ii) if the holders of such Indebtedness are granted a Lien
upon all or any portion of the Collateral, (A) such Lien shall be subject and
subordinate to the Liens upon the Collateral under the Loan Documents and (B)
the Loan Parties shall grant to the Collateral Agent, for the benefit of the
Credit Parties, a security interest (which may be subordinate to the Lien in
favor of the holders of the Permitted Senior Debt) in and to all property and
assets (including without limitation Excluded Assets) on which the holders of
the Permitted Senior Debt are granted a first priority Lien pursuant to an
amendment to the Security Agreement and/or such other security instruments in
form and substance acceptable to the Required Lenders;

        

        (q)           Liens
in favor of customs and revenues authorities imposed by applicable Law arising
in the ordinary course of business in connection with the importation of goods
and securing obligations (i) that are not overdue by more than thirty (30) days,
or (ii)(A) that are being contested in good faith by appropriate proceedings,
(B) the applicable Loan Party or Subsidiary has set aside on its

        

        
          
            
            

          

          
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        books adequate reserves with respect thereto in accordance with
GAAP and (C) such contest effectively suspends collection of the contested
obligation and enforcement of any Lien securing such
obligation;

        

        (r)           Liens
in connection with any sale-leasebacks permitted by clause (g) of Section 7.05; provided that no
such Lien shall extend to cover any property or asset of such Loan Party other
than the
lease entered into in connection with any such sale-leaseback;

        

        (s)           Liens
consisting of cash deposits in an amount not to exceed $10,000,000 securing the
obligations of the Borrowers under Bank Products permitted under Section
7.03(d);

        

        (t)           in
connection with the sale or transfer of all of the Equity Interests of a
Subsidiary in a transaction permitted by Section 7.05,
customary rights and restrictions contained in agreements relating to such sale
or transfer pending the completion thereof;

        

        (u)           in
the case of a Subsidiary that is not a wholly-owned Subsidiary, any put and call
arrangements related to its Equity Interests set forth in its Organizational
Documents or any related joint venture or similar agreement; and

        

        (v)           Liens
on Excluded Assets securing other Permitted Indebtedness under Section 7.03(k) that does not
exceed $25,000,000 in the aggregate in addition to those Liens permitted by Section 7.01(a)
through
(u), provided
that, if requested by the Administrative Agent, the holder of such Lien
first enters into an
intercreditor agreement reasonably satisfactory to Administrative Agent
providing for or protecting the right of the Agents to dispose of, or otherwise
enforce Liens upon, the Collateral.

        

        7.02       Investments. Make any Investments, except
for the following (each a "Permitted Investment"):

        

        (a)           Investments
existing on the Closing Date, and set forth on Schedule 7.02, but
not any increase in the amount thereof or any other modification of the terms
thereof;

        

        (b)           Investments
by the Lead Borrower or its Subsidiaries in the form of (i) readily marketable
obligations issued or directly and fully guaranteed or insured by the United
States of America or any agency or instrumentality thereof having maturities of
not more than 360 days from the date of acquisition thereof; provided that the
full faith and credit of the United States of America is pledged in support
thereof; (ii) notes, bonds or other obligations of states, counties, and
municipalities of the United States that are rated not less than MIG1 or VMIG1;
(iii) time deposits with, or insured certificates of deposit or bankers’
acceptances of, any commercial bank or trust company that (1) (A) is a Lender or
(B) is organized under the laws of the United States of America, any state
thereof or the District of Columbia or is the principal banking subsidiary of a
bank holding company organized under the laws of the United States of America,
any state thereof or the District of Columbia, and is a member of the Federal
Reserve System, or (C) is a Foreign Bank that has an agency, branch or
representative bank with a domestic U.S. license and (2) issues (or the parent
of which issues) commercial paper rated at least "Prime-1" (or the then
equivalent grade) by Moody’s or at least "A-1" (or the then equivalent grade) by
S&P and (D) has combined capital and surplus of at least $40,000,000,000 (or
$50,000,000,000 in the case of any such Foreign Bank), in each case with
maturities of not more than 180 days from the date of acquisition thereof; (iv)
commercial paper issued by any Person organized under the laws of any state of
the United States of America and rated at least "Prime-1" (or the then
equivalent grade) by Moody’s or at least "A-1" (or the then equivalent grade) by
S&P, in each case with maturities of not more than 270 days from the date of
acquisition thereof; (v) fully collateralized repurchase agreements with a term
of not more than thirty (30) days for securities described in clause (i) above
(without regard to the limitation on maturity contained in such clause) and
entered into with a financial institution satisfying the criteria described
in

        

        
          
            
            

          

          
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        clause (iii) above or with any primary dealer and having a market
value at the time that such repurchase agreement is entered into of not less
than 100% of the repurchase obligation of such counterparty entity with whom
such repurchase agreement has been entered into; (vi) Investments, classified in
accordance with GAAP as current assets of the Loan Parties, in any money market
fund, mutual fund, or other investment companies that are registered under the
Investment Company Act of 1940, as amended, which are administered by financial
institutions that have the highest rating obtainable from either Moody’s or
S&P, and which invest solely in one or more of the types of securities
described in clauses (i) through (v) above;

        

        (c)           advances
to officers, directors and employees of the Lead Borrower and the other Loan
Parties in an aggregate amount not to exceed $5,000,000 at any time outstanding,
for travel, entertainment, relocation and analogous ordinary business
purposes.

        

        (d)          (i)    Investments
by any Loan Party and its Subsidiaries in their respective Subsidiaries
outstanding on the date hereof, and (ii) additional Investments by any Loan
Party and its Subsidiaries in Loan Parties;

        

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

        

        
          (f)        
  Guarantees
constituting Permitted Indebtedness;

        

        

        
          (g)    
     Investments
constituting Permitted Acquisitions;

        

        

        
          (h)      
   at  any  time  after  Chelsea  Insurance  Company  Ltd.  becomes  an  active  self-insurance
Subsidiary of the Lead Borrower in connection with a Permitted Self-Insurance
Program, Investments in Chelsea Insurance Company Ltd. not to exceed $25,000,000
in the aggregate;

        

        

        (i)           Investments
received in connection with the bankruptcy or reorganization of, or settlement
of delinquent accounts and disputes with, customers and suppliers, in each case
in the ordinary course of business;

        

        
          (j)         
  Investments
by any Loan Party in Swap Contracts permitted hereunder; and

        

        

        (k)           without duplication of Investments
permitted pursuant to clauses (a) through (j) above, other Investments, provided that (i) no Default shall have
occurred or shall arise as a result of such Investment, (ii) Projected Excess
Availability and Pro Forma Excess Availability as of the date of consummation of
such Investment will be equal to or greater than twenty percent (20.0%) of the
Loan Cap, (iii) the Consolidated Fixed Charge Coverage Ratio, on a pro-forma
basis for the Measurement Period immediately prior to such Investment, will be
equal to or greater than 1.1 to 1.0 and (iv) the Lead Borrower shall have
delivered written certification as to satisfaction, and a reasonably detailed
calculation, of items (i), (ii) and (iii) above five (5) Business Days prior to
the date of such Investment;

        

        provided, however, that
notwithstanding the foregoing, (i) after the occurrence and during the
continuance of a Trigger
Event, no such Investments specified in clause (b) shall be permitted unless
either (A) no Loans are then outstanding, or (B) the Investment is a temporary
Investment pending expiration of an Interest Period for a LIBO Rate Loan, the
proceeds of which Investment will be applied to the Obligations after the
expiration of such Interest Period, and (ii) such Investments shall be pledged
to the Collateral

        

        
          
            
            

          

          
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        Agent as collateral for the Secured Obligations pursuant to such
agreements as may be reasonably required by the Collateral
Agent.

        

        7.03        Indebtedness;
Disqualified Stock. Issue Disqualified Stock or create, incur,
assume, guarantee,
suffer to exist, issue or otherwise become or remain liable with respect to, any
Indebtedness, except the following ("Permitted
Indebtedness"):

        

        
          (a)          
the
Secured Obligations;

        

        

        (b)           Indebtedness
outstanding on the date hereof and listed on Schedule 7.03 and
any  Permitted Refinancings thereof;

        

        (c)           Indebtedness
of any Loan Party to any other Loan Party and guaranties by any Loan Party of
any Indebtedness of any other Loan Party otherwise permitted
hereunder;

        

        (d)           obligations
(contingent or otherwise) of any Loan Party or any Subsidiary thereof existing
or arising under any Swap Contract, provided that (i)
such obligations are (or were) entered into by such Person in the ordinary
course of business for the purpose of directly mitigating risks associated with
liabilities, commitments, investments, assets, or property held or reasonably
anticipated by such Person, or changes in the value of securities issued by such
Person, and not for purposes of speculation or taking a "market view;" and (ii)
such Swap Contract does not contain any provision exonerating the non-
defaulting party from its obligation to make payments on outstanding
transactions to the defaulting party; provided that the
aggregate notional amount of all such Swap Contracts shall not exceed
$250,000,000 at any time outstanding;

        

        (e)           without
duplication of Indebtedness described in clause (g) of this definition, purchase
money Indebtedness of any Loan Party to finance the acquisition of any fixed or
capital assets, including Capital Lease Obligations, and any Indebtedness
assumed in connection with the acquisition of any such assets or secured by a
Lien on any such assets prior to the acquisition thereof, and any Permitted
Refinancing thereof, provided, however, that the
aggregate principal amount of Indebtedness permitted by this clause (e) shall
not exceed $100,000,000 at any time outstanding and provided, further, that, if
requested by the Collateral Agent with respect to any Material Storage Location
or any other warehouse or other leased storage or distribution facility in which
$10,000,000 or more of Inventory is or may be located from time to time, the
Loan Parties shall cause the holders of such Indebtedness to enter into a
Collateral Access Agreement on terms reasonably satisfactory to the Collateral
Agent;

        

        (f)           Contingent
liabilities under surety bonds or similar instruments incurred in the ordinary
course of business in connection with the construction or improvement of
Stores;

        

        (g)           Indebtedness
with respect to the deferred purchase price for any Permitted Acquisition other
than the BNCB Acquisition, provided that such
Indebtedness does not require the payment in cash of principal (other than in
respect of working capital adjustments) prior to the Maturity Date, has a
maturity which extends beyond the Maturity Date, and is subordinated to the
Secured Obligations on terms reasonably acceptable to the Agents;

        

        (h)           Indebtedness
of any Person that becomes a Subsidiary of a Loan Party in a Permitted
Acquisition, which Indebtedness is existing at the time such Person becomes a
Subsidiary of a Loan Party (other than Indebtedness incurred in contemplation of
such Person’s becoming a Subsidiary of a Loan Party) and any Permitted
Refinancing thereof;

        

        (i)           Indebtedness under the Seller Notes and
any Permitted Refinancing thereof;

        

        
          
            
            

          

          
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          (j)       
   the
Permitted Senior Debt and any Permitted Refinancing thereof;

        

        

        (k)          other
Indebtedness in an aggregate principal amount not to exceed $50,000,000 at any
time outstanding;

        

        (l)           Indebtedness
owed to any Person providing worker’s compensation, health, disability or other
employee benefits or property, casualty insurance or liability insurance,
pursuant to reimbursement or indemnification obligations to such Person, in each
case, incurred in the ordinary course of business; and

        

        (m)           Indebtedness
owed in respect of any overdrafts and related liabilities arising from Cash
Management Services or any other treasury, depositary and cash management
services or in connection with any ACH transfer of funds.

        

        7.04     
 Fundamental
Changes. Merge, dissolve, liquidate, consolidate with or into
another Person, (or
agree to do any of the foregoing), except that, so long as no Default shall have
occurred and be continuing prior to or immediately after giving effect to any
action described below or would result therefrom:

        

        (a)           any
Subsidiary may merge with (i) a Loan Party, provided that the
Loan Party shall be the continuing or surviving Person, or (ii) any one or more
other Subsidiaries, provided that when
any wholly-owned Subsidiary is merging with another Subsidiary, the wholly-owned
Subsidiary shall be the continuing or surviving Person; and

        

        (b)           in
connection with a Permitted Acquisition, any Subsidiary may merge with or into
or consolidate with any other Person or permit any other Person to merge with or
into or consolidate with it; provided that (i) if
such Subsidiary is a Subsidiary of a Loan Party, the Person surviving such
merger shall be a wholly-owned Subsidiary of a Loan Party and (ii) in the case
of any such merger to which any Loan Party is a party, such Loan Party is the
surviving Person.

        

        7.05           Dispositions. Make
any Disposition or enter into any agreement to make any Disposition,
except the following (each a "Permitted
Disposition"):

        

        
          (a)          
Dispositions
of Equipment in the ordinary course of business that is substantially
worn,
damaged, obsolete or, in the judgment of a Loan Party, no longer useful or
necessary in its business or that of any Subsidiary and is not replaced with
similar property having at least equivalent value;

           

        

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

        

        

        (c)           with
respect to BNCB and its Subsidiaries, Store closings (including the termination
or non-renewal of any applicable Lease or contract), bulk sales or other
dispositions of the Inventory of a Loan Party conducted in orderly fashion in
accordance with the applicable Store contract or otherwise and otherwise typical
for the college bookseller industry (“Customary BNCB
Dispositions”), provided, that any other Store
closures and related Inventory dispositions that are not Customary BNCB Dispositions
shall be permitted hereunder so long as such closures and dispositions shall not
exceed (i) in any Fiscal Year of the BNCB and its Subsidiaries, ten percent
(10.0%) of the number of such Loan Parties’ Store contracts as of the beginning
of such Fiscal Year (net of new Store openings) and (ii) in the aggregate from
and after the Closing Date, twenty-five percent (25.0%) of the number of such
Loan Parties’ Store contracts in existence as of the Closing Date (net of new
Store openings); provided, further, that all Net Proceeds
received in connection therewith are applied to the Obligations if then required
in accordance with
Section 2.05
hereof;

        

        
          
            
            

          

          
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        (d)           with
respect to the Lead Borrower and its Subsidiaries (other than BNCB and its
Subsidiaries), Store closings (including the termination or non-renewal of any
applicable Lease or contract), bulk sales or other dispositions of the Inventory
of a Loan Party not in the ordinary course of business in connection such Store
closings, at arm’s length, provided, that (i) such Store
closures and related Inventory dispositions shall not exceed (A) in any Fiscal
Year of the Lead Borrower and such Subsidiaries, ten percent (10.0%) of the
number of such Loan Parties’ Stores as of the beginning of such Fiscal Year (net
of new Store openings) and (B) in the aggregate from and after the Closing Date,
twenty- five percent (25.0%) of the number of such Loan Parties’ Stores in
existence as of the Closing Date (net of new Store openings, and (ii) in all
events, all sales of Inventory in connection with any such Store closings (in a
single or series of related transactions) of between 7.5% and 10.0% of the
number of such Loan Parties’ Stores then in existence, either (A) shall be in
accordance with liquidation agreements and with professional liquidators
reasonably acceptable to the Agents or (B) if not conducted in accordance with
the preceding subclause (A) shall be permitted hereunder only so long as
Projected Excess Availability after giving effect to each such transaction for
the six fiscal months following the month in which such transaction took place
shall be equal or greater than thirty percent (30.0%) of the Loan Cap; provided, further, that (x) all Net
Proceeds received in connection therewith (including any Net Proceeds from the
Disposition of the B. Dalton store chain in accordance with the following
subclause (y)) are applied to the Obligations if then required in accordance
with Section
2.05 hereof, and (y) the Borrowers shall be permitted to close the B.
Dalton store chain or any portion thereof, and such closings shall not be
included in the calculation of percentage of Store closings or otherwise be
subject to subclauses (i) and (ii) of the preceding proviso;

        

        (e)           non-exclusive
licenses of Intellectual Property of a Loan Party or any of its Subsidiaries in
the ordinary course of business;

        

        (f)           sales,
transfers and dispositions among Guarantors or by any Subsidiary that is not a
Borrower to a Guarantor;

        

        (g)           sales,
transfers and dispositions among the Borrowers or by any Subsidiary that is not
a Borrower to Borrower;

        

        (h)           sales,
transfers and dispositions by any Immaterial Subsidiary which is not a Loan
Party to another Person;

        

        (i)           as
long as no Default then exists or would arise therefrom, sales of Real Estate of
any Loan Party (or sales of any Person or Persons created to hold such Real
Estate or the equity interests in such Person or Persons), including
sale-leaseback transactions involving any such Real Estate pursuant to leases on
market terms, as long as, (A) such sale is made for fair market value, (B) to
the extent that such sale constitutes a Prepayment Event, the Net Proceeds are
utilized to repay the Obligations, and (C) in the case of any sale-leaseback
transaction permitted hereunder with respect to any Material Storage Location or
any other warehouse or other leased storage or distribution facility in which
$10,000,000 or more of Inventory is or may be located from time to time, the
Collateral Agent shall have received from such purchaser or transferee a
Collateral Access Agreement on terms and conditions reasonably satisfactory to
the Collateral Agent;

        

        (j)           any
Disposition of Real Estate to a Governmental Authority as a result of the
condemnation of such Real Estate so long as an amount equal to the Net Proceeds
of such Disposition is utilized to repay the Loans and Cash Collateralize the LC
Obligations if and to the extent then required in accordance with Section 2.05
hereof;

        

        
          
            
            

          

          
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        (k)           Dispositions
of Excluded Assets in accordance with any intercreditor agreement or Security
Documents applicable thereto;

        

        (l)           termination
or non-renewal of a Lease and granting a lease, sublease, license or other
occupancy interest with respect to any owned Real Estate or any real property
subject to a Lease, in each case, so long as such action could not reasonably be
expected to result in Material Adverse Effect; or

        

        (m)           as
long as no Default exists or would arise therefrom and without duplication of
Dispositions permitted pursuant to clauses (a) through (l) above, other
Dispositions, provided that the
aggregate fair market value of all assets Disposed of in reliance upon this
paragraph (m) shall not exceed $35,000,000 during any Fiscal Year of the Lead
Borrower and if such Disposition constitutes a Prepayment Event, proceeds
thereof are applied in accordance with Section
2.05(e).

        

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

        

        (a)           each Subsidiary of a Loan Party may
make Restricted Payments to any Loan Party;

        

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

        

        (c)           the
Lead Borrower may make cash dividends in an aggregate amount of up to
$65,000,000 in any Fiscal Year to holders of common stock of the Lead Borrower,
provided that
Projected Excess Availability and Pro Forma Excess Availability as of the date
of payment of such dividend shall be equal to or greater than twenty-five
percent (25.0%) of the Loan Cap;

        

        (d)           the
Lead Borrower may pay other cash dividends on its common stock and repurchase,
redeem or otherwise acquire Equity Interests issued by it if, after giving
effect to such transaction or payment, (i) Projected Excess Availability and Pro
Forma Excess Availability as of the date of consummation of such payment will be
equal to or greater than twenty-five percent (25.0%) of the Loan Cap, (ii) the
Consolidated Adjusted Fixed Charge Coverage Ratio, on a pro- forma basis for the
Measurement Period immediately prior to such transaction or payment, will be
equal to or greater than 1.25 to 1.00 and (iii) the Lead Borrower shall have
delivered written certification as to and a reasonably detailed calculation of
items (i), and (ii) above five (5) Business Days prior to the date of such
transaction or payment; and

        

        (e)           the
Lead Borrower and each of its Subsidiaries may make Restricted Payments as
consisting of dividends payable on vested or unvested common stock to its
employees consistent with past practice and in an amount not to exceed
$3,000,000 per annum.

        

        7.07        Prepayments
of Indebtedness. Prepay, redeem, purchase, defease or otherwise
satisfy, in each
case, prior to the scheduled maturity thereof in any manner any Indebtedness
(other than Indebtedness under the Loan Documents), except that, so long as no
Default shall have occurred and be continuing prior to or immediately after
giving effect to any action described below or would result
therefrom:

        

        
          
            
            

          

          
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        (a)           regularly
scheduled or mandatory repayments, repurchases, redemptions or defeasances of
Permitted Indebtedness (including, without limitation, Specified
Indebtedness);

        

        (b)           the
Lead Borrower may voluntarily prepay, redeem, purchase, defease or otherwise
satisfy, in each case, prior to the scheduled maturity thereof in any manner any
Permitted Indebtedness (including, without limitation, Specified Indebtedness)
if, after giving effect to such payment, redemption, purchase, defeasance or
other prepayment transaction, (i) Projected Excess Availability and Pro Forma
Excess Availability as of the date of consummation of such payment will be equal
to or greater than twenty-five percent (25.0%) of the Loan Cap, (ii) the
Consolidated Adjusted Fixed Charge Coverage Ratio, on a pro-forma basis for the
Measurement Period immediately prior to such transaction or payment, will be
equal to or greater than 1.25 to 1.00 and (iii) the Lead Borrower shall have
delivered written certification as to and a reasonably detailed calculation of
items (i) and (ii) above five (5) Business Days prior to the date of such
transaction or payment, it being agreed and understood that this clause (b)
shall not prohibit the voluntary prepayment of Specified Indebtedness to the
extent otherwise permitted by clause (c) of this Section
7.07);

        

        (c)           voluntary
prepayments, repurchases, redemptions or defeasances of Specified Indebtedness
in an aggregate amount not exceeding $250,000,000, as long as (i) Projected
Excess Availability and Pro Forma Excess Availability as of the date of
consummation of such payment will be equal to or greater than fifty percent
(50.0%) of the Loan Cap, and (ii) the Lead Borrower shall have delivered written
certification as to satisfaction, and a reasonably detailed calculation, of item
(i) above five (5) Business Days prior to the date of such prepayment;
and

         

        
          (d)     
    Permitted  Refinancings  of  certain  Permitted  Indebtedness  in  accordance  with
Section
7.03.

        

        

        For the
avoidance of doubt, it is understood and agreed that any payment made in respect
of Subordinated Indebtedness shall not be in violation of any subordination
terms of any Subordinated Indebtedness.

        

        7.08        Change in
Nature of Business. Engage in any line of business substantially
different from the
Business conducted by the Loan Parties and their Subsidiaries on the date hereof
or any business substantially related, incidental or complimentary
thereto.

        

        7.09        Transactions
with Affiliates. Enter
into, renew, extend or be a party to any transaction of
any kind with any Affiliate of any Loan Party, whether or not in the ordinary
course of business, other than on fair and reasonable terms substantially as
favorable to the Loan Parties or such Subsidiary as would be obtainable by the
Loan Parties or such Subsidiary at the time in a comparable arm’s length
transaction with a Person other than an Affiliate, provided that the
foregoing restriction shall not apply to a transaction between or among the Loan
Parties not prohibited hereunder.

        

        7.10        Burdensome
Agreements. Enter
into or permit to exist any Contractual Obligation (other
than this Agreement or any other Loan Document) that (a) limits the ability (i)
of any Subsidiary to make Restricted Payments or other distributions to any Loan
Party or to otherwise transfer property to or invest in a Loan Party, (ii) of
any Subsidiary to Guarantee the Secured Obligations, (iii) of any Subsidiary to
make or repay loans to a Loan Party, or (iv) of the Loan Parties or any
Subsidiary to create, incur, assume or suffer to exist Liens on property of such
Person in favor of the Collateral Agent; provided, however, that this
clause (iv) shall not prohibit any negative pledge incurred or provided in favor
of any holder of
Indebtedness permitted under and in accordance with clauses (e) (solely to the
extent any such negative pledge relates to the property financed by or the
subject of such Indebtedness), (g), (h) (solely to the extent any such negative
pledge relates to the Subsidiary acquired pursuant to a Permitted

        

        
          
            
            

          

          
            107

            
              

            

          

          
            
            

          

        

        

        Acquisition), (j) (so long as such negative pledge permits Liens in
accordance with Section 7.01(p) and
any intercreditor agreement applicable to the Permitted Senior Debt) or (k)
(solely to the extent any such negative pledge relates to the property financed
by or the subject of such Indebtedness) of Section 7.03; or (b)
requires the grant of a Lien to secure an obligation of such Person if a Lien is
granted to secure another obligation of such Person; provided, that (x)
the foregoing shall not apply to restrictions and conditions imposed by
applicable Law, (y) the foregoing shall not apply to customary restrictions and
conditions contained in agreements relating to the sale of a Subsidiary
permitted hereunder pending such sale, provided that such
restrictions and conditions apply only to the Subsidiary that is to be sold and
(z) clause (a)(iv) of this Section shall not apply to customary provisions in
leases restricting the assignment thereof or the granting of a leasehold
mortgage thereon.

        

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

        

        7.12       Amendment
of Organizational Documents or Material Indebtedness. Amend, modify
or waive (a) its Organization Documents in a manner materially adverse to the
Credit Parties (it being understood that any modification of the Organizational
Documents of any Loan Party for the purpose of changing its Fiscal Year in
accordance with Section 7.13(a) shall
not be considered materially adverse to the Credit Parties) or (b) any Loan
Party’s rights under the Seller Notes or any other Material Indebtedness, in
each case to the extent that such amendment, modification or waiver (i) would
violate, or compliance with which could reasonably be expected to result in the
violation of, any Loan Document, (ii) otherwise
could reasonably be expected to be materially adverse (in the reasonable
determination of the Lenders) to the interests of the Credit Parties, taken as a
whole, or (iii) could be reasonably expected to have a Material Adverse Effect.
For the avoidance of doubt, a change in the jurisdiction of incorporation and/or
the legal structure of BNCB (from a corporation to a limited liability company)
undertaken in connection with the BNCB Acquisition shall be permitted under this
Section 7.12,
so long as such change is completed within 18 months of the consummation of the
BNCB Acquisition.

        

        
          7.13     
 Corporate
Name; Fiscal Year.

        

        

        (a)           Change
the Fiscal Year of any Loan Party, or the accounting policies or reporting
practices of the Loan Parties, except as required by GAAP, except that the Loan
Parties may change certain of their Fiscal Years once after the consummation of
the BNCB Acquisition so that all the Loan Parties have the same Fiscal
Year.

        

        (b)           Effect
or permit any change referred to in Section 6.14 unless
(i) the Collateral Agent’s written acknowledgement that all filings have been
made under the UCC or otherwise that are required in order for the Collateral
Agent to continue at all times following such change to have a valid, legal and
perfected first priority security interest in all the Collateral (or, if any
Excluded Asset is added as Collateral in connection with the issuance of
Permitted Senior Debt, a valid, legal and perfected second priority security
interest on such Collateral, subject to Permitted Encumbrances) for its own
benefit and the benefit of the other Credit Parties, and (ii) after giving
effect to any change to the location of the Collateral, all Collateral shall be
located within the United States.

        

        

        7.14       Deposit
Accounts; Credit Card Processors. Open
new DDAs or Blocked Accounts, or enter
into agreements with any credit card processors, unless the Loan Parties shall
have delivered to the Collateral Agent appropriate Blocked Account Agreements,
DDA Notifications or Credit Card Notifications, as appropriate, consistent with
the provisions of Section 6.13 and
otherwise reasonably

        

        
          
            
            

          

          
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      satisfactory to the Administrative Agent; provided that the
Borrowers shall be permitted to open new DDAs to the extent that such DDAs are
sub-accounts of any DDA at a depository institution for which a DDA notification
has already been delivered. Except as permitted hereby, no Loan Party shall
maintain any bank accounts or enter into any agreements with credit card
processors other than the ones expressly contemplated herein or in Section 6.13
hereof.

      
        
          

          7.15       Consolidated
Fixed Charge Coverage Ratio. During any Fixed Charge
Trigger Period, permit the Consolidated
Fixed Charge Coverage Ratio for any Measurement Period, calculated as of the
last day of each month to be less than 1.10 to 1.00.

          

          ARTICLE
VIII

          EVENTS
OF DEFAULT AND REMEDIES

          

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

          

          

          (a)           Non-Payment. The
Borrowers or any other Loan Party fails to pay when and as required to be
paid herein, (i) any amount of principal of any Loan or any LC Obligation
(including by deposit of funds as Cash Collateral in respect of LC Obligations),
or (ii) any interest on any Loan or on any LC Obligation, or any fee due
hereunder, or (iii) within three (3) Business Days after the same becomes due,
any other amount payable hereunder or under any other Loan Document;
or

          

          (b)           Specific Covenants.
(i) Any Loan Party fails to perform or observe any term, covenant or
agreement contained in any of Sections 6.01, 6.02, 6.03, 6.05, 6.07, 6.10, 6.11, 6.13 or Article VII;
or

          

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

          

          (d)           Representations and
Warranties. Any representation, warranty, certification or statement of
fact made or deemed made by or on behalf of any Borrower or any other Loan Party
herein, in any other Loan Document, or in any document delivered in connection
herewith or therewith (including, without limitation, any Borrowing Base
Certificate) shall be incorrect or misleading in any material respect when made
or deemed made; or

          

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

          

          
            
              
              

            

            
              109

              
                

              

            

            
              
              

            

          

          
occurs under any Swap Contract an Early Termination Date (as
defined in such Swap Contract) resulting from (A) any event of default under
such Swap Contract as to which a Loan Party or any Subsidiary thereof is the
Defaulting Party (as defined in such Swap Contract) or (B) any Termination Event
(as so defined) under such Swap Contract as to which a Loan Party or any
Subsidiary thereof is an Affected Party (as so defined) and, in either event,
the Swap Termination Value owed by the Loan Party or such Subsidiary as a result
thereof is greater than $35,000,000; or

          

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

          

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

          

          (h)           Judgments. There is
entered against any Loan Party or any Subsidiary thereof (i) one or more
judgments or orders for the payment of money in an aggregate amount (as to all
such judgments and orders) exceeding $35,000,000 (to the extent not covered by
independent third- party insurance as to which the insurer is rated at least "A"
by A.M. Best Company, has been notified of the potential claim and does not
dispute coverage), or (ii) any one or more non- monetary judgments that have, or
could reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect and, in either case, (A) enforcement proceedings are
commenced by any creditor upon such judgment or order, or (B) there is a period
of 10 consecutive days during which a stay of enforcement of such judgment or
order, by reason of a pending appeal or otherwise, is not in effect;
or

          

          (i)           
ERISA. (i) An
ERISA Event occurs with respect to a Pension Plan or Multiemployer
Plan which has resulted or could reasonably be expected to result in liability
of any Loan Party under Title IV of ERISA to the Pension Plan, Multiemployer
Plan or the PBGC in an aggregate amount in excess of $35,000,000 or which could
reasonably likely result in a Material Adverse Effect, or (ii) a Loan Party or
any ERISA Affiliate fails to pay when due, after the expiration of any
applicable grace period, any installment payment with respect to its withdrawal
liability under Section 4201 of ERISA under a Multiemployer Plan in an aggregate
amount in excess of $35,000,000 or which could reasonably likely result in a
Material Adverse Effect; or

          

          (j)           
Invalidity of Loan
Documents. (i) Any material provision of any Loan Document, at any time
after its execution and delivery and for any reason other than as
expressly

          

          
            
              
              

            

            
              110

              
                

              

            

            
              
              

            

          

           

          permitted hereunder or thereunder or satisfaction in full of all
the Obligations, ceases to be in full force and effect; or any Loan Party or any
other Person contests in any manner the validity or enforceability of any
material provision of any Loan Document; or any Loan Party denies that it has
any or further liability or obligation under any provision of any Loan Document,
or purports to revoke, terminate or rescind any provision of any Loan Document
or seeks to avoid, limit or otherwise adversely affect any Lien purported to be
created under any Security Document; or (ii) any Lien purported to be created
under any Security Document shall cease to be, or shall be asserted by any Loan
Party or any other Person not to be, a valid and perfected Lien on any
Collateral, with the priority required by the applicable Security Document;
or

           

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

          

          (l)          
 Cessation of
Business. The Loan Parties, taken as a whole, shall take any action to suspend all
or substantially all operations of their Business or liquidate all or a material
portion of their assets or Store locations, or employ an agent or other third
party to conduct a program of closings, liquidations or "Going-Out-Of-Business"
sales of any material portion of its business; or

          

          (m)         
Loss of
Collateral. There occurs any uninsured loss to any material portion
of the
Collateral; or

          

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

          

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

          

          (a)           declare
the Commitments of each Lender to make Loans and any obligation of the LC Issuer
to make LC Credit Extensions to be terminated, whereupon such Commitments and
obligation shall be terminated;

          

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

          

          (c)           require
that the Loan Parties Cash Collateralize the LC Obligations (in an amount equal
to 105% of the then Outstanding Amount thereof); and

          

          (d)           whether
or not the maturity of any of the Secured Obligations shall have been
accelerated pursuant hereto, proceed to protect, enforce and exercise all rights
and remedies of the Credit Parties under this Agreement, any of the other Loan
Documents or applicable Law, including, but not limited to, by suit in equity,
action at law or other appropriate proceeding,

          

          
            
              
              

            

            
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          whether for the specific performance of any covenant or agreement
contained in this Agreement and the other Loan Documents or any instrument
pursuant to which the Secured Obligations are evidenced, and, if such amount
shall have become due, by declaration or otherwise, proceed to enforce the
payment thereof or any other legal or equitable right of the Credit
Parties;

          

          provided, however, that upon
the occurrence of any Event of Default under Section 8.01(f)
or Section
8.1(g), the obligation of each Lender to make Loans and any obligation of
the LC Issuer to make LC Credit
Extensions shall automatically terminate, the unpaid principal amount of all
outstanding Loans and all interest and other amounts as aforesaid shall
automatically become due and payable, and the obligation of the Loan Parties to
Cash Collateralize the LC Obligations as aforesaid shall automatically become
effective, in each case without further act of the Administrative Agent or any
Lender.

          

          No remedy
herein is intended to be exclusive of any other remedy and each and every remedy
shall be cumulative and shall be in addition to every other remedy given
hereunder or now or hereafter existing at law or in equity or by statute or any
other provision of Law.

          

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

          

          First, to payment of
that portion of the Obligations constituting fees, indemnities, Credit Party Expenses
and other amounts (including fees, charges and disbursements of counsel to the
Administrative Agent and the Collateral Agent and amounts payable under Article III) payable
to the Administrative Agent and the Collateral Agent, each in its capacity as
such;

          

          Second, to payment of
that portion of the Obligations constituting indemnities, Credit Party Expenses,
and other amounts (other than principal, interest and fees) payable to the
Lenders and the LC Issuer (including fees, charges and disbursements of counsel
to the respective Lenders and the LC Issuer and amounts payable under Article III), ratably
among them in proportion to the amounts described in this clause Second payable to
them;

          

          Third, to the extent
not previously reimbursed by the Lenders, to payment to the Lenders of that portion
of the Obligations constituting principal and accrued and unpaid interest on any
Permitted Overadvances, ratably among the Lenders in proportion to the amounts
described in this clause Third payable to
them;

          

          Fourth, to the extent
that Swing Line Loans have not been refinanced by a Committed Loan, payment
to the Swing Line Lender of that portion of the Obligations constituting accrued
and unpaid interest on the Swing Line Loans;

          

          Fifth, to payment of
that portion of the Obligations constituting accrued and unpaid interest on the
Loans, LC Borrowings and other Obligations, and fees (including Letter of Credit
Fees), ratably among the Lenders and the LC Issuer in proportion to the
respective amounts described in this clause Fifth payable to
them;

          

          Sixth, to the extent
that Swing Line Loans have not been refinanced by a Committed Loan, to
payment to the Swing Line Lender of that portion of the Obligations constituting
unpaid principal of the Swing Line Loans;

          

          
            
              
              

            

            
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          Seventh, to payment
of that portion of the Obligations constituting unpaid principal of the Loans and LC
Borrowings, ratably among the Lenders and the LC Issuer in proportion to the
respective amounts described in this clause Seventh held by
them;

          

          Eighth, to the
Administrative Agent for the account of the LC Issuer, to Cash Collateralize
that portion of LC Obligations comprised of the aggregate undrawn amount of
Letters of Credit;

          

          Ninth, to payment of
all other Obligations (including without limitation the Cash Collateralization
of unliquidated indemnification obligations as provided in Section 10.04),
ratably among the Credit Parties in proportion to the respective amounts
described in this clause Ninth held by
them

          

          Tenth, to payment or
Cash Collateralization (if agreed by the applicable Loan Parties and any Credit
Party that is a provider of any Cash Management Services) of that portion of the
Secured Obligations arising from Cash Management Services, ratably among the
Credit Parties in proportion to the respective amounts described in this clause
Tenth held by
them;

          

          Eleventh, to payment
or Cash Collateralization (if agreed by the parties to any Swap Contract) of
all other Secured Obligations arising from Bank Products, ratably among the
Credit Parties in proportion to the respective amounts described in this clause
Eleventh held
by them; and

          

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

          

          Subject
to Section
2.03(c), amounts used to Cash Collateralize the aggregate undrawn amount
of Letters of Credit pursuant to clause Seventh above shall
be applied to satisfy drawings under such Letters of Credit as they occur. If
any amount remains on deposit as Cash Collateral after all Letters of Credit
have either been fully drawn or expired, such remaining amount shall be applied
to the other Obligations, if any, in the order set forth above.

          

          Amounts
distributed with respect to any Secured Obligations attributable to Other
Liabilities shall be equal to the lesser of (a) the applicable amount of such
Other Liabilities last reported to the Administrative Agent or (b) the actual
amount of such Other Liabilities as calculated by the methodology reported to
the Administrative Agent for determining the amount due. The Administrative
Agent shall have no obligation to calculate the amount to be distributed with
respect to any such Other Liabilities, but may rely upon written notice of the
amount (setting forth a reasonably detailed calculation) from the applicable
Lender or its Affiliate providing such Bank Products or Cash Management
Services. In the absence of such notice, the Administrative Agent may assume the
amount to be distributed is the amount of such obligations last reported to
it.

          

          ARTICLE
IX

          ADMINISTRATIVE
AGENT

          

          
            9.01        
Appointment
and Authority.

          

          

          (a)           Each
of the Lenders and the LC Issuer hereby irrevocably appoints Bank of America to
act on its behalf as the Administrative Agent hereunder and under the other Loan
Documents and authorizes the Administrative Agent to take such actions on its
behalf and to

          

          
            
              
              

            

            
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          exercise such powers as are delegated to the Administrative Agent
by the terms hereof or thereof, together with such actions and powers as are
reasonably incidental thereto. The provisions of this Article are solely for the
benefit of the Administrative Agent, the Lenders and the LC Issuer, and no Loan
Party or any Subsidiary thereof shall have rights as a third party beneficiary
of any of such provisions.

          

          (b)           Each
of the Lenders (in its capacities as a Lender), Swing Line Lender and the LC
Issuer hereby irrevocably appoints Bank of America as Collateral Agent and
authorizes the Collateral Agent to act as the agent of such Lender and the LC
Issuer for purposes of acquiring, holding and enforcing any and all Liens on
Collateral granted by any of the Loan Parties to secure any of the Secured
Obligations, together with such powers and discretion as are reasonably
incidental thereto. In this connection, the Collateral Agent, as "collateral
agent" and any co- agents, sub-agents and attorneys-in-fact appointed by the
Collateral Agent pursuant to Section 9.05 for purposes of
holding or enforcing any Lien on the Collateral (or any portion thereof) granted under
the Security Documents, or for exercising any rights and remedies thereunder at
the direction of the Collateral Agent), shall be entitled to the benefits of all
provisions of this Article IX and Article X
(including
Section 10.04(c)), as though such co-agents, sub-agents and attorneys-in-fact
were the "collateral agent" under the Loan Documents, as if set forth in full
herein with respect thereto.

          

          (c)           Each
provider of Cash Management Services and/or Bank Products that is an Affiliate
of a Lender but not a party to this Agreement shall be deemed to have
acknowledged and accepted the appointment of the Administrative Agent and the
Collateral Agent pursuant to the terms of this Article IX for itself
and its Affiliates as if a “Lender” party hereto.

          

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

          

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

          

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

          

          (b)           shall
not have any duty to take any discretionary action or exercise any discretionary
powers, except discretionary rights and powers expressly contemplated hereby or
by the other Loan Documents that the Administrative Agent or the Collateral
Agent, as applicable, is required to exercise as directed in writing by the
Required Lenders (or such other number or percentage of the Lenders as shall be
expressly provided for herein or in the other Loan Documents), provided that no
Agent shall be required to take any action that, in its opinion or the opinion
of its counsel, may expose such Agent to liability or that is contrary to any
Loan Document or applicable Law; and

          

          
            
              
              

            

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

          

          No Agent
shall be liable for any action taken or not taken by it (i) with the Consent or
at the request of the Required Lenders (or such other number or percentage of
the Lenders as shall be necessary, or as such Agent shall believe in good faith
shall be necessary, under the circumstances as provided in Sections 10.01 and 8.02) or (ii) in the
absence of its own gross negligence or willful misconduct as determined by a final and
non-appealable judgment of a court of competent jurisdiction.

          

          The
Agents shall not be deemed to have knowledge of any Default unless and until
notice describing such Default is given to such Agent by the Loan Parties, a
Lender or the LC Issuer. In the event that the Agents obtain such actual
knowledge or receive such a notice, the Agents shall give prompt notice thereof
to each of the other Credit Parties. Upon the occurrence of an Event of Default,
the Agents shall take such action with respect to such Event of Default as shall
be reasonably directed by the Required Lenders. Unless and until the Agents
shall have received such direction, the Agents may (but shall not be obligated
to) take such action, or refrain from taking such action, with respect to any
such Event of Default as they, or either of them, shall deem advisable in the
best interest of the Credit Parties. In no event shall the Agents be required to
comply with any such directions to the extent that any Agent believes that its
compliance with such directions would be unlawful.

          

          The
Agents shall not be responsible for or have any duty to ascertain or inquire
into (i) any statement, warranty or representation made in or in connection with
this Agreement or any other Loan Document, (ii) the contents of any certificate,
report or other document delivered hereunder or thereunder or in connection
herewith or therewith, (iii) the performance or observance of any of the
covenants, agreements or other terms or conditions set forth herein or therein
or the occurrence of any Default, (iv) the validity, enforceability,
effectiveness or genuineness of this Agreement, any other Loan Document or any
other agreement, instrument or document or the creation, perfection or priority
of any Lien purported to be created by the Security Documents, (v) the value or
the sufficiency of any Collateral, or (vi) the satisfaction of any condition set
forth in Article
IV or elsewhere herein, other than to confirm receipt of items expressly
required to be delivered to the Agents.

          

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

          

          9.05       Delegation
of Duties. Each
Agent may perform any and all of its duties and exercise its rights and powers
hereunder or under any other Loan Document by or through any one or
more

          

          
            
              
              

            

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

           

          9.06       Resignation
of Agents. Either
Agent may at any time give written notice of its resignation to the
Lenders, the LC Issuer and the Lead Borrower. Upon receipt of any such notice of
resignation, the Required Lenders shall have the right to appoint a successor,
which shall be a bank with an office in the United States, or an Affiliate of
any such bank with an office in the United States, and, so long as no Event of
Default has occurred and is continuing, shall be reasonably acceptable to the
Lead Borrower. If no such successor shall have been so appointed by the Required
Lenders and shall have accepted such appointment within 30 days after the
retiring Agent gives notice of its resignation, then the retiring Agent may on
behalf of the Lenders and the LC Issuer, appoint a successor Administrative
Agent or Collateral Agent, as applicable, meeting the qualifications set forth
above; provided
that if the Administrative Agent or the Collateral Agent shall notify the Lead
Borrower and the Lenders that no qualifying Person has accepted such
appointment, then such resignation shall nonetheless become effective in
accordance with such notice and (a) the retiring Agent shall be discharged from
its duties and obligations hereunder and under the other Loan Documents (except
that in the case of any Collateral held by the Collateral Agent on behalf of the
Lenders or the LC Issuer under any of the Loan Documents, the retiring
Collateral Agent shall continue to hold such collateral security until such time
as a successor Collateral Agent is appointed) and (b) all payments,
communications and determinations provided to be made by, to or through the
Administrative Agent shall instead be made by or to each Lender and the LC
Issuer directly, until such time as the Required Lenders appoint a successor
Administrative Agent as provided for above in this Section 9.06. Upon
the acceptance of a successor’s appointment as Administrative Agent or
Collateral Agent, as applicable, hereunder, such successor shall succeed to and
become vested with all of the rights, powers, privileges and duties of the
retiring (or retired) Agent, and the retiring Agent shall be discharged from all
of its duties and obligations hereunder or under the other Loan Documents (if
not already discharged therefrom as provided above in this Section 9.06). The
fees payable by the Borrowers to a successor Administrative Agent shall be the
same as those payable to its predecessor unless otherwise agreed between the
Lead Borrower and such successor. After the retiring Agent’s resignation
hereunder and under the other Loan Documents, the provisions of this Article IX and Section 10.04 shall
continue in effect for the benefit of such retiring Agent, its sub-agents and
their respective
Related Parties in respect of any actions taken or omitted to be taken by any of
them while the retiring Agent was acting as Administrative Agent or Collateral
Agent hereunder.

          

          Any
resignation by Bank of America as Administrative Agent pursuant to this Section
shall also constitute its resignation as LC Issuer and Swing Line Lender. Upon
the acceptance of a successor’s appointment as Administrative Agent hereunder,
(a) such successor shall succeed to and become vested with all of the rights,
powers, privileges and duties of the retiring LC Issuer and Swing Line Lender,
(b) the retiring LC Issuer and Swing Line Lender shall be discharged from all of
their respective duties and obligations hereunder or under the other Loan
Documents, and (c) the successor LC Issuer shall issue letters of credit in
substitution for the Letters of Credit, if any, outstanding at the time of such
succession or make other arrangements satisfactory to the retiring LC Issuer to
effectively assume the obligations of the retiring LC Issuer with respect to
such Letters of Credit.

          

          9.07       Non-Reliance
on Administrative Agent and Other Lenders. Each Lender and the LC Issuer acknowledges that
it has, independently and without reliance upon the Agents or any other Lender
or any of their Related Parties and based on such documents and information as
it has deemed appropriate, made its own credit analysis and decision to enter
into this Agreement. Each Lender and the LC Issuer also acknowledges that it
will, independently and without reliance upon the Agents or any
other

          

          
            
              
              

            

            
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          Lender or any of their Related Parties and based on such documents
and information as it shall from time to time deem appropriate, continue to make
its own decisions in taking or not taking action under or based upon this
Agreement, any other Loan Document or any related agreement or any document
furnished hereunder or thereunder. Except as provided in Section 9.12, the
Agents shall not have any duty or responsibility to provide any Credit Party
with any other credit or other information concerning the affairs, financial
condition or business of any Loan Party that may come into the possession of the
Agents.

          

          9.08       No Other
Duties, Etc. Anything herein to the contrary notwithstanding, none of
the Joint Lead
Bookrunners, Joint Lead Arrangers, Co-Syndication Agents, Co-Documentation
Agents or Co- Senior Managing Agents shall have any powers, duties or
responsibilities under this Agreement or any of the other Loan Documents, except
in its capacity, as applicable, as the Administrative Agent, Collateral Agent, a
Lender or the LC Issuer hereunder.

          

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

          

          (a)           to
file and prove a claim for the whole amount of the principal and interest owing
and unpaid in respect of the Loans, LC Obligations and all other Secured
Obligations that are owing and unpaid and to file such other documents as may be
necessary or advisable in order to have the claims of the Lenders, the LC
Issuer, the Administrative Agent and the other Credit Parties (including any
claim for the reasonable compensation, expenses, disbursements and advances of
the Lenders, the LC Issuer, the Administrative Agent, such Credit Parties and
their respective agents and counsel and all other amounts due the Lenders, the
LC Issuer the Administrative Agent and such Credit Parties under Sections 2.03(i),
2.03(j) and 2.03(k) as
applicable, 2.09 and 10.04) allowed in
such judicial proceeding; and

          

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

          

          and any
custodian, receiver, assignee, trustee, liquidator, sequestrator or other
similar official in any such judicial proceeding is hereby authorized by each
Lender and the LC Issuer to make such payments to the Administrative Agent and,
if the Administrative Agent shall consent to the making of such payments
directly to the Lenders and the LC Issuer, to pay to the Administrative Agent
any amount due for the reasonable compensation, expenses, disbursements and
advances of the Administrative Agent and its agents and counsel, and any other
amounts due the Administrative Agent under Sections 2.09 and
10.04.

          

          Nothing
contained herein shall be deemed to authorize the Administrative Agent to
authorize or consent to or accept or adopt on behalf of any Lender or the LC
Issuer any plan of reorganization, arrangement, adjustment or composition
affecting the Secured Obligations or the rights of any Lender or the LC Issuer
or to authorize the Administrative Agent to vote in respect of the claim of any
Lender or the LC Issuer in any such proceeding.

          

          
            9.10     
 Collateral
and Guaranty Matters. The
Credit Parties irrevocably authorize the Agents,

          

          

          (a)           to
release any Lien on any property granted to or held by the Collateral Agent
under any Loan Document (i) upon termination of the Aggregate Commitments and
all Secured

          

          
            
              
              

            

            
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          Obligations (other than contingent indemnification obligations for
which no claim has been asserted) becoming Fully Satisfied and the expiration or
termination of all Letters of Credit or the Cash Collateralization of any LC
Obligations, (ii) that is sold or to be sold as part of or in connection with
any sale permitted hereunder or under any other Loan Document, (iii) with
respect to any Lien upon any Excluded Asset, in accordance with the terms and
conditions of any intercreditor agreement and Security Documents applicable
thereto, or (iv) with respect to any Liens on property constituting less than
all or substantially all of the Collateral, if approved, authorized or ratified
in writing by the Required Lenders;

          

          (b)          to
subordinate any Lien on any property granted to or held by the Collateral Agent
under any Loan Document to the holder of any Lien on such property that is
permitted by clause (j) of Section 7.01;
and

          

          (c)           to
release any Guarantor from its obligations under the Facility Guaranty and each
other applicable Loan Document if such Person ceases to be a Subsidiary as a
result of a transaction permitted hereunder.

          

          Upon
request by any Agent at any time, the applicable Lenders will confirm in writing
such Agent’s authority to release or subordinate its interest in particular
types or items of property, or to release any Guarantor from its obligations
under the Facility Guaranty and each other applicable Loan Document pursuant to
this Section
9.10. In each case as specified in this Section 9.10, the
Agents will, at the Loan Parties’ expense, execute and deliver to the applicable
Loan Party such documents as such Loan Party may reasonably request to evidence
the release of such item of Collateral from the assignment and security interest
granted under the Security Documents or to subordinate its interest in such
item, or to release such Guarantor from its obligations under the Facility
Guaranty and each other applicable Loan Document, in each case in accordance
with the terms of the Loan Documents and this Section
9.10.

          

          9.11       Notice of
Transfer.

          

          The
Agents may deem and treat a Lender party to this Agreement as the owner of such
Lender’s portion of the Secured Obligations for all purposes, unless and until,
and except to the extent, an Assignment and Acceptance shall have become
effective as set forth in Section
10.06.

          

          
            9.12      
Reports
and Financial Statements.  By signing this Agreement, each
Lender:

          

          

          (a)           agrees
to furnish the Administrative Agent during any Trigger Period (and thereafter at
such frequency as the Administrative Agent may reasonably request) with a
summary of all Other Liabilities due or to become due to such Lender. In
connection with any distributions to be made hereunder, the Administrative Agent
shall be entitled to assume that no amounts are due to any Lender on account of
Other Liabilities unless the Administrative Agent has received written notice
thereof from such Lender;

          

          (b)           is
deemed to have requested that the Administrative Agent furnish such Lender,
promptly after they become available, copies of all financial statements
required to be delivered by the Lead Borrower hereunder and all commercial
finance examinations and appraisals of the Collateral received by the Agents
(collectively, the "Reports");

          

          (c)           expressly
agrees and acknowledges that the Administrative Agent makes no representation or
warranty as to the accuracy of the Reports, and shall not be liable for any
information contained in any Report;

          

          
            
              
              

            

            
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          (d)           expressly
agrees and acknowledges that the Reports are not comprehensive audits or
examinations, that the Agents or any other party performing any audit or
examination will inspect only specific information regarding the Loan Parties
and will rely significantly upon the Loan Parties' books and records, as well as
on representations of the Loan Parties' personnel;

          

          (e)           agrees
to keep all Reports confidential in accordance with the provisions of Section 10.07 hereof;
and

          

          (f)           without
limiting the generality of any other indemnification provision contained in this
Agreement, agrees: (i) to hold the Agents and any such other Lender preparing a
Report harmless from any action the indemnifying Lender may take or conclusion
the indemnifying Lender may reach or draw from any Report in connection with any
Credit Extensions that the indemnifying Lender has made or may make to the
Borrowers, or the indemnifying Lender's participation in, or the indemnifying
Lender's purchase of, a Loan or Loans; and (ii) to pay and protect, and
indemnify, defend, and hold the Agents and any such other Lender preparing a
Report harmless from and against, the claims, actions, proceedings, damages,
costs, expenses, and other amounts (including attorney costs) incurred by the
Agents and any such other Lender preparing a Report as the direct or indirect
result of any third parties who obtain all or part of any Report through the
indemnifying Lender.

          

          9.13       Agency
for Perfection. Each Lender hereby appoints each other Lender as agent
for the purpose
of perfecting Liens for the benefit of the Agents and the Lenders, in assets
which, in accordance with Article 9 of the UCC or any other applicable Law of
the United States can be perfected only by possession. Should any Lender (other
than the Agents) obtain possession of any such Collateral, such Lender shall
notify the Agents thereof, and, promptly upon the Collateral Agent's request
therefor shall deliver such Collateral to the Collateral Agent or otherwise deal
with such Collateral in accordance with the Collateral Agent's
instructions.

          

          9.14       Indemnification
of Agents. The Lenders shall indemnify the Agents (to the extent not reimbursed
by the Loan Parties and without limiting the obligations of Loan Parties
hereunder), ratably according to their Applicable Percentages, 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 any Agent 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 any Agent 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 from such Agent’s gross negligence or willful misconduct
as determined by a final and nonappealable judgment of a court of competent
jurisdiction.

          

          9.15       Relation
among Lenders. The Lenders are not partners or co-venturers, and no
Lender shall
be liable for the acts or omissions of, or (except as otherwise set forth herein
in case of the Agents) authorized to act for, any other Lender.

          

          
            9.16     
 Defaulting
Lender.

          

           

          (a)           If
for any reason any Lender shall fail or refuse to abide by its obligations under
this Agreement, including without limitation its obligation to make available to
Administrative Agent its Applicable Percentage of any Loans, expenses or setoff
or purchase its Applicable Percentage of a participation interest in the Swing
Line Loans or LC Borrowings and such failure is not cured within two (2)
Business Days of receipt from the Administrative Agent of written notice
thereof, then, in addition to the rights and remedies that may be available to
the other

          

          
            
              
              

            

            
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          Credit Parties, the Loan Parties or any other party at law or in
equity, and not in limitation thereof, (i) such Defaulting Lender’s right to
participate in the administration of, or decision- making rights related to, the
Obligations, this Agreement or the other Loan Documents shall be suspended
during the pendency of such failure or refusal, except as otherwise expressly
provided in Section
10.01, (ii) at the Administrative Agent’s option, any and all payments
otherwise payable to a Defaulting Lender from the Loan Parties, whether on
account of outstanding Loans, interest, fees or otherwise, may be held by the
Administrative Agent and readvanced to the Borrowers, the Swing Line Lender or
any LC Issuer as the Defaulting Lender’s Applicable Percentage of any Borrowing
or required funding of a participation in Swing Line Loans or Letters of Credit
and (iii) without limiting the provisions of clause (ii), a Defaulting Lender
shall be deemed to have assigned any and all payments due to it from the Loan
Parties, whether on account of outstanding Loans, interest, fees or otherwise,
to the remaining non-Defaulting Lenders for application to, and reduction of,
their proportionate shares of all outstanding Obligations until, as a result of
application of such assigned payments the Lenders’ respective Applicable
Percentages of all outstanding Obligations shall have returned to those in
effect immediately prior to such delinquency and without giving effect to the
nonpayment causing such delinquency. The Defaulting Lender’s decision-making and
participation rights and rights to payments as set forth in clauses (i), (ii)
and (iii) hereinabove shall be restored only upon the payment by the Defaulting
Lender of its Applicable Percentage of any Obligations, any participation
obligation, or expenses as to which it is delinquent, together with interest
thereon at the Default Rate from the date when originally due until the date
upon which any such amounts are actually paid.

           

          (b)           Any
non-Defaulting Lenders shall also have the right, but not the obligation, in
their respective, sole and absolute discretion, to cause the termination and
assignment, without any further action by the Defaulting Lender for no cash
consideration (pro
rata, based on the respective Commitments of those Lenders electing to
exercise such right), of the Defaulting Lender’s Commitment to fund future
Loans. Upon any such purchase of the Applicable Percentage of any Defaulting
Lender, the Defaulting Lender’s share in future Credit Extensions and its rights
under the Loan Documents with respect thereto shall terminate on the date of
purchase, and the Defaulting Lender shall promptly execute all documents
reasonably requested to surrender and transfer such interest, including, if so
requested, an Assignment and Acceptance.

          

          (c)           Each
Defaulting Lender shall indemnify the Administrative Agent and each non-
Defaulting Lender from and against any and all loss, damage or expenses,
including but not limited to reasonable attorneys’ fees and funds advanced by
the Administrative Agent or by any non-Defaulting Lender, on account of a
Defaulting Lender’s failure to timely fund its Applicable Percentage of a Loan
or to otherwise perform its obligations under the Loan Documents.

          

          ARTICLE
X

          MISCELLANEOUS

          

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

          

          (a)           waive any condition set forth in
Article
IV without the written
consent of each Lender;

          

          
            
              
              

            

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

          

          (c)           postpone
any date fixed by this Agreement or any other Loan Document for (i) any payment
or mandatory prepayment of principal, interest, fees or other amounts due to the
Lenders (or any of them) hereunder or under any of the other Loan Documents
without the written Consent of each Lender directly affected thereby, or (ii)
any scheduled or mandatory reduction of the Aggregate Commitments hereunder or
under any other Loan Document without the written Consent of each Lender
directly affected thereby;

          

          (d)           reduce
the principal of, or the rate of interest specified herein on, any Loan or LC
Borrowing, or (subject to clause (iv) of the second proviso to this Section 10.01) any
fees or other amounts payable hereunder or under any other Loan Document,
without the written Consent of each Lender directly affected thereby; provided, however, that only
the Consent of the Required Lenders shall be necessary to amend the definition
of "Default Rate" or to waive any obligation of the Borrowers to pay interest or
Letter of Credit Fees at the Default Rate;

          

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

          

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

          

          (g)           except
as expressly permitted hereunder or under any other Loan Document, release, or
limit the liability of, any Loan Party without the written Consent of each
Lender;

          

          (h)           except
for Permitted Dispositions and as otherwise expressly permitted in Section 9.10, release all or
substantially all of the Collateral from the Liens of the Security
Documents without the
written Consent of each Lender;

          

          (i)           increase
the advance rates set forth in the definition of the term "Borrowing Base"
without the written Consent of each Lender, without limitation of clause (j)
below;

          

          (j)           modify
(i) any component (other than advance rates or Reserves) of the Borrowing Base,
including eligibility criteria, in any manner that would increase availability
thereunder or (ii) the discretion of the Administrative Agent to change,
establish or eliminate any Reserves without the consent of the Super-Majority
Required Lenders;

          

          (k)           modify
the definition of Permitted Overadvance so as to increase the amount thereof or,
except as provided in such definition, the time period for a Permitted
Overadvance without the written Consent of each Lender; or

          

          (l)           except
as otherwise expressly permitted herein or in any other Loan Document,
subordinate the Secured Obligations hereunder to any other Indebtedness, and,
except for any intercreditor agreement approved by the Required Lenders in
connection with the issuance by any Loan Party of Permitted Senior Debt and
except as otherwise expressly permitted herein or in any other Loan Document,
subordinate the Liens granted hereunder or under the other Loan Documents to any
other Lien without the written Consent of each Lender;

          

          
            
              
              

            

            
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          and, provided further,
that (i) no amendment, waiver or Consent shall, unless in writing and signed by
the LC Issuer in addition to the Lenders required above, affect the rights or
duties of the LC Issuer under this Agreement or any Issuer Document relating to
any Letter of Credit issued or to be issued by it; (ii) no amendment, waiver or
Consent shall, unless in writing and signed by the Swing Line Lender in addition
to the Lenders required above, affect the rights or duties of the Swing Line
Lender under this Agreement; (iii) no amendment, waiver or Consent shall, unless
in writing and signed by the Administrative Agent in addition to the Lenders
required above, affect the rights or duties of the Administrative Agent under
this Agreement or any other Loan Document; (iv) no amendment, waiver or Consent
shall, unless in writing and signed by the Collateral Agent in addition to the
Lenders required above, affect the rights or duties of the Collateral Agent
under this Agreement or any other Loan Document, and (v) the Fee Letter may be
amended, or rights or privileges thereunder waived, in a writing executed only
by the parties thereto. Notwithstanding anything to the contrary herein, (x) no
Credit Party that is not a Lender, LC Issuer or Agent under this Agreement and
(y) no Defaulting Lender shall have any right to approve or disapprove any
amendment, waiver or Consent hereunder, except that (A) the Commitment of any
Defaulting Lender may not be increased or extended and (B) the outstanding
Obligations owing to such Defaulting Lender shall not be reduced or forgiven, in
each case without the consent of such Defaulting Lender.

          

          If any
Lender does not Consent (a "Non-Consenting
Lender") to a proposed amendment, waiver, consent or release with respect
to any Loan Document that requires the Consent of each Lender and that has been
approved by the Required Lenders, the Lead Borrower may replace such
Non-Consenting Lender in accordance with Section 10.13; provided that such
amendment, waiver, consent or release can be effected as a result of the
assignment contemplated by such Section (together with all other such
assignments required by the Lead Borrower to be made pursuant to this
paragraph).

          

          
            10.02     
 Notices;
Effectiveness; Electronic Communications.

          

          

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

          

          (i)           if
to the Loan Parties, the Agents, the LC Issuer or the Swing Line Lender, to the
address, telecopier number, electronic mail address or telephone number
specified for such Person on Schedule 10.02;
and

          

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

          

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

          

          (b)           Electronic
Communications. Notices and other communications to the Lenders and the
LC Issuer hereunder may be delivered or furnished by electronic communication
(including e-mail and Internet or intranet websites) pursuant to procedures
approved by the

          

          
            
              
              

            

            
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          Administrative Agent, provided that the
foregoing shall not apply to notices to any Lender or the LC Issuer pursuant to
Article II if
such Lender or the LC Issuer, as applicable, has notified the Administrative
Agent that it is incapable of receiving notices under such Article II by
electronic communication. The Administrative Agent or the Lead Borrower may, in
its discretion, agree to accept notices and other communications to it hereunder
by electronic communications pursuant to procedures approved by it, provided that
approval of such procedures may be limited to particular notices or
communications. Unless the Administrative Agent otherwise prescribes, (i)
notices and other communications sent to an e-mail address shall be deemed
received upon the sender’s receipt of an acknowledgment from the intended
recipient (such as by the "return receipt requested" function, as available,
return e-mail or other written acknowledgment), provided that if such
notice or other communication is not sent during the normal business hours of
the recipient, such notice or communication shall be deemed to have been sent at
the opening of business on the next Business Day for the recipient, and (ii)
notices or communications posted to an Internet or intranet website shall be
deemed received upon the deemed receipt by the intended recipient at its e-mail
address as described in the foregoing clause (i) of notification that such
notice or communication is available and identifying the website address
therefor.

          

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

          

          (d)           Change of Address,
Etc. Each of the Loan Parties, the Agents, the LC Issuer and the Swing Line
Lender may change its address, telecopier or telephone number for notices and
other communications hereunder by notice to the other parties hereto. Each other
Lender may change its address, telecopier or telephone number for notices and
other communications hereunder by notice to the Lead Borrower, the Agents, the
LC Issuer and the Swing Line Lender. In addition, each Lender agrees to notify
the Administrative Agent from time to time to ensure that the Administrative
Agent has on record (i) an effective address, contact name, telephone number,
telecopier number and electronic mail address to which notices and other
communications may be sent and (ii) accurate wire instructions for such
Lender.

          

          (e)           Reliance by Agents, LC
Issuer and Lenders. The Agents, the LC Issuer and the Lenders shall
be entitled to rely and act upon any notices (including telephonic Committed
Loan Notices, Conversion/Continuation Notices and Swing Line Loan Notices)
purportedly given by or

          

          
            
              
              

            

            
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          on behalf of the Loan Parties even if (i) such notices were not
made in a manner specified herein, were incomplete or were not preceded or
followed by any other form of notice specified herein, or (ii) the terms
thereof, as understood by the recipient, varied from any confirmation thereof.
The Loan Parties shall indemnify the Agents, the LC Issuer, each Lender and the
Related Parties of each of them from all losses, costs, expenses and liabilities
resulting from the reliance by such Person on each notice purportedly given by
or on behalf of the Loan Parties. All telephonic notices to and other telephonic
communications with the Agents may be recorded by the Agents, and each of the
parties hereto hereby consents to such recording.

          

          10.03     No
Waiver; Cumulative Remedies. No failure by any Credit
Party to exercise, and no delay by any such Person
in exercising, any right, remedy, power or privilege hereunder shall operate as
a waiver thereof; nor shall any single or partial exercise of any right, remedy,
power or privilege hereunder or under any other Loan Document preclude any other
or further exercise thereof or the exercise of any other right, remedy, power or
privilege. The rights, remedies, powers and privileges provided herein and in
the other Loan Documents are cumulative and not exclusive of any rights,
remedies, powers and privileges provided by law. Without limiting the generality
of the foregoing, the making of a Loan or issuance of a Letter of Credit shall
not be construed as a waiver of any Default, regardless of whether any Credit
Party may have had notice or knowledge of such Default at the time.

          

          
            10.04      
Expenses;
Indemnity; Damage Waiver.

          

          

          (a)           Costs and Expenses.
Subject to certain terms contained in the Fee Letter with respect to the
parties to such Fee Letter, the Borrowers shall pay all Credit Party
Expenses.

          

          (b)           Indemnification by the Loan
Parties. The Loan Parties shall indemnify the Agents (and any
sub-agent thereof), each other Credit Party, and each Related Party of any of
the foregoing Persons (each such Person being called an "Indemnitee") against,
and hold each Indemnitee harmless (on an after tax basis) from, any and all
losses, claims, causes of action, damages, liabilities, settlement payments,
costs, and related expenses (including the reasonable fees, charges and
disbursements of any counsel for any Indemnitee), incurred by any Indemnitee or
asserted against any Indemnitee by any third party or by any Borrower or any
other Loan Party arising out of, in connection with, or as a result of (i) the
execution or delivery of this Agreement, any other Loan Document or any
agreement or instrument contemplated hereby or thereby, the performance by the
parties hereto of their respective obligations hereunder or thereunder or the
consummation of the transactions contemplated hereby or thereby, or, in the case
of the Agents (and any sub-agents thereof) and their Related Parties only, the
administration of this Agreement and the other Loan Documents, (ii) any Loan or
Letter of Credit or the use or proposed use of the proceeds therefrom (including
any refusal by the LC Issuer to honor a demand for payment under a Letter of
Credit if the documents presented in connection with such demand do not strictly
comply with the terms of such Letter of Credit), (iii) any actual or alleged
presence or release of Hazardous Materials on or from any property owned or
operated by any Loan Party or any of its Subsidiaries, or any Environmental
Liability related in any way to any Loan Party or any of its Subsidiaries, (iv)
any claims of, or amounts paid by any Credit Party to, a Blocked Account Bank or
other Person which has entered into a control agreement with any Credit Party
hereunder, or (v) any actual or prospective claim, litigation, investigation or
proceeding relating to any of the foregoing, whether based on contract, tort or
any other theory, whether brought by a third party or by any Borrower or any
other Loan Party or any of the Loan Parties’ directors, shareholders or
creditors, and regardless of whether any Indemnitee is a party thereto, in all
cases, whether or not caused by or arising, in whole or in part, out of the
comparative, contributory or sole negligence of the Indemnitee; provided that such
indemnity shall not, as to any Indemnitee, be available to the extent that such
losses, claims, damages, liabilities or related expenses are determined by
a

          

          
            
              
              

            

            
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          court of competent jurisdiction by final and nonappealable judgment
to have resulted from the gross negligence, bad faith or willful misconduct of
such Indemnitee.

          

          (c)           Reimbursement by
Lenders. Without limiting the Lenders’ obligations under Section 9.14 hereof,
to the extent that the Loan Parties for any reason fail to indefeasibly pay
any amount
required under subsection (a) or (b) of this Section 10.04 to be
paid by it, each Lender severally agrees to pay to the Agents (or any such
sub-agent), the LC Issuer or such Related Party, as the case may be, such
Lender’s Applicable Percentage (determined as of the time that the applicable
unreimbursed expense or indemnity payment is sought) of such unpaid amount,
provided that
the unreimbursed expense or indemnified loss, claim, damage, liability or
related expense, as the
case may be, was incurred by or asserted against the Agents (or any such sub-
agent) or the LC Issuer in its capacity as such, or against any Related Party of
any of the foregoing acting for the Agents (or any such sub-agent) or LC Issuer
in connection with such capacity. The obligations of the Lenders under this
subsection (c) are subject to the provisions of Section
2.12(d).

          

          (d)           Waiver of Consequential
Damages, Etc. To the fullest extent permitted by applicable Law,
the Loan Parties shall not assert, and hereby waive, any claim against any
Indemnitee, on any theory of liability, for special, indirect, consequential or
punitive damages (as opposed to direct or actual damages) arising out of, in
connection with, or as a result of, this Agreement, any other Loan Document or
any agreement or instrument contemplated hereby, the transactions contemplated
hereby or thereby, any Loan or Letter of Credit or the use of the proceeds
thereof. No Indemnitee shall be liable for any damages arising from the use by
unintended recipients of any information or other materials distributed to such
unintended recipients by such Indemnitee through telecommunications, electronic
or other information transmission systems in connection with this Agreement or
the other Loan Documents or the transactions contemplated hereby or thereby
other than for direct or actual damages resulting from the gross negligence or
willful misconduct of such Indemnitee as determined by a final and nonappealable
judgment of a court of competent jurisdiction.

          

          (e)           Payments. All amounts
due under this Section
10.04 shall be payable no later than three (3)
Business Days after demand therefor.

          

          (f)           Survival. The
agreements in this
Section 10.04 shall survive the resignation of any Agent, the
Swing Line Lender, and the LC Issuer, the assignment of any Commitment or Loan
by any Lender, the replacement of any Lender, the termination of the Aggregate
Commitments and the repayment, satisfaction or discharge of all the other
Secured Obligations.

          

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

          

          
            
              
              

            

            
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          10.06     Successors
and Assigns.

          

          (a)           Successors and Assigns
Generally. The provisions of this Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns permitted hereby, except that no Loan Party may assign or otherwise
transfer any of its rights or obligations hereunder or under any other Loan
Document without the prior written Consent of the Administrative Agent and each
Lender and no Lender may assign or otherwise transfer any of its rights or
obligations hereunder except (i) to an Eligible Assignee in accordance with the
provisions of Section 10.06(b), (ii) by way
of participation in accordance with the provisions of subsection Section 10.06(d),
or (iii)
by way of pledge or assignment of a security interest subject to the
restrictions of Section 10.06(f) (and
any other attempted assignment or transfer by any party hereto shall be null and
void). Nothing in this Agreement, expressed or implied, shall be construed to
confer upon any Person (other than the parties hereto, their respective
successors and assigns permitted hereby, Participants to the extent provided in
subsection (d) of this Section 10.06 and, to
the extent expressly contemplated hereby, the Related Parties of each of the
Credit Parties) any legal or equitable right, remedy or claim under or by reason
of this Agreement.

          

          (b)           Assignments by
Lenders. Any Lender may at any time assign to one or more Eligible
Assignees all or a portion of its rights and obligations under this Agreement
(including all or a portion of its Commitment(s) and the Loans (including for
purposes of this Section 10.06(b),
participations in LC Obligations and in Swing Line Loans) at the time owing to
it); provided
that any such assignment shall be subject to the following
conditions:

          

          (i)           Minimum
Amounts.

          

          (A) in
the case of an assignment of the entire remaining amount of the assigning
Lender's Commitment and the Loans at the time owing to it or in the case of an
assignment to a Lender or an Affiliate of a Lender or an Approved Fund with
respect to a Lender, no minimum amount need be assigned; and

          

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

          

          (C) after
giving effect to any such assignment, the aggregate amount of the remaining
Commitment (which for this purpose includes Loans outstanding thereunder) or, if
the Commitment is not then in effect, the principal outstanding balance of the
Loans held by the assigning Lender shall not be less than $5,000,000 unless each
of the Administrative Agent and,

          

          
            
              
              

            

            
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          so long as no Event of Default has occurred and is continuing, the
Lead Borrower otherwise consents (each such consent not to be unreasonably
withheld or delayed).

          

          (ii)           Proportionate
Amounts. Each partial assignment shall be made as an assignment of a
proportionate part of all the assigning Lender's rights and obligations under
this Agreement with respect to the Loans or the Commitment assigned, except that
this clause (ii) shall not apply to the Swing Line Lender’s rights and
obligations in respect of Swing Line Loans;

          

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

          

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

          

          (B) the
consent of the Administrative Agent (such consent not to be unreasonably
withheld or delayed) shall be required for assignments in respect of any
Commitment if such assignment is to a Person that is not a Lender, an Affiliate
of such Lender or an Approved Fund with respect to such Lender; and

          

          (C) the
consent of the LC Issuer (such consent not to be unreasonably withheld or
delayed) shall be required for any assignment that increases the obligation of
the assignee to participate in exposure under one or more Letters of Credit
(whether or not then outstanding) unless such assignment is to a Lender, an
Affiliate of a Lender or an Approved Fund; and

          

          (D) the
consent of the Swing Line Lender (such consent not to be unreasonably withheld
or delayed) shall be required for any assignment in respect of the assignment of
any Commitment unless such assignment is to a Lender, an Affiliate of a Lender
or an Approved Fund.

          

          (iv)           Assignment and
Assumption. The parties to each assignment shall execute and deliver to
the Administrative Agent an Assignment and Assumption, together with a
processing and recordation fee of $3,500, provided, however, that the
Administrative Agent may, in its sole discretion, elect to waive such processing
and recordation fee in the case of any assignment. The assignee, if it shall not
be a Lender, shall deliver to the Administrative Agent an Administrative
Questionnaire.

          

          Subject
to acceptance and recording thereof by the Administrative Agent pursuant to
subsection (c) of this Section, from and after the effective date specified in
each Assignment and Assumption, the Eligible Assignee thereunder shall be a
party to this Agreement and, to the extent of the interest assigned by such
Assignment and Assumption, have the rights and obligations of a Lender under
this Agreement, and the assigning Lender thereunder shall, to the extent of the
interest assigned by such Assignment and Assumption, be released from its
obligations under this Agreement (and, in the case of an Assignment and
Assumption covering all of the assigning Lender's rights and obligations under
this Agreement, such Lender shall cease to be a party hereto) but shall continue
to be entitled to the benefits of Sections 3.01, 3.04, 3.05, and 10.04 with respect
to facts and circumstances occurring prior to the effective date of such assignment.
Upon request, the Borrowers (at their expense) shall execute and deliver a Note
to the assignee Lender. Any assignment or transfer by a Lender of rights or
obligations under this Agreement

          

          
            
              
              

            

            
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          that does not comply with this subsection shall be treated for
purposes of this Agreement as a sale by such Lender of a participation in such
rights and obligations in accordance with Section
10.06(d).

          

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

          

          (d)           Participations. Any
Lender may at any time, without the consent of, or notice to, the Loan Parties
or the Administrative Agent, sell participations to any Person (other than a
natural person or the Loan Parties or any of the Loan Parties’ Affiliates or
Subsidiaries) (each, a "Participant") in all
or a portion of such Lender's rights and/or obligations under this Agreement
(including all or a portion of its Commitment and/or the Loans (including such
Lender’s participations in LC Obligations and/or Swing Line Loans) owing to it);
provided that
(i) such Lender's obligations under this Agreement shall remain unchanged, (ii)
such Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations and (iii) the Loan Parties, the Agents, the
Lenders and the LC Issuer shall continue to deal solely and directly with such
Lender in connection with such Lender's rights and obligations under this
Agreement. Any Participant shall agree in writing to comply with all
confidentiality obligations set forth in Section 10.07 as if
such Participant was a Lender hereunder.

          

          Any
agreement or instrument pursuant to which a Lender sells such a participation
shall provide that such Lender shall retain the sole right to enforce this
Agreement and to approve any amendment, modification or waiver of any provision
of this Agreement; provided that such
agreement or instrument may provide that such Lender will not, without the
consent of the Participant, agree to any amendment, waiver or other modification
described in the first proviso to Section 10.01 that
affects such Participant. Subject to subsection (e) of this Section, the Loan
Parties agree that each Participant shall be entitled to the benefits of Sections 3.01, 3.04 and 3.05 to the same
extent as if it were a Lender and had acquired its interest by assignment
pursuant to Section
10.06(b). To the extent permitted by law, each Participant also shall be
entitled to the benefits of Section 10.08 as
though it were a Lender, provided such Participant agrees to be subject to Section 2.13 as
though it were a Lender.

          

          Each
Lender that sells a participation shall, acting solely for this purpose as an
agent of the Borrower, maintain a register on which it enters the name and
address of each Participant and the principal amounts of each Participant’s
interest in the Loans or other obligations under this Agreement (the “Participant
Register”). The entries in the Participant Register shall be conclusive
absent manifest error, and such Lender shall treat each person whose name is
recorded in the Participant Register as the owner of such participation for all
purposes of this Agreement notwithstanding any notice to the contrary. Any such
Participant Register shall be available for inspection by the Borrowers at any
reasonable time and from time to time upon reasonable prior notice.

          

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

          

          
            
              
              

            

            
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          Borrower is notified of the participation sold to such Participant
and such Participant agrees, for the benefit of the Loan Parties, to comply with
Section 3.01(e)
as though it were a Lender.

          

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

          

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

          

          (h)           Resignation as LC Issuer or
Swing Line Lender after Assignment. Notwithstanding anything to the
contrary contained herein, if at any time Bank of America assigns all of its
Commitment and Loans pursuant to subsection (b) above, Bank of America may, (i)
upon 30 days’ notice to the Lead Borrower and the Lenders, resign as LC Issuer
and/or (ii) upon 30 days’ notice to the Lead Borrower, resign as Swing Line
Lender. In the event of any such resignation as LC Issuer or Swing Line Lender,
the Lead Borrower shall be entitled to appoint from among the Lenders a
successor LC Issuer or Swing Line Lender hereunder; provided, however, that no
failure by the Lead Borrower to appoint any such successor shall affect the
resignation of Bank of America as LC Issuer or Swing Line Lender, as the case
may be. If Bank of America resigns as LC Issuer, it shall retain all the rights,
powers, privileges and duties of the LC Issuer hereunder with respect to all
Letters of Credit outstanding as of the effective date of its resignation as LC
Issuer and all LC Obligations with respect thereto (including the right to
require the Lenders to make Base Rate Loans or fund risk participations in
Unreimbursed Amounts pursuant to Section 2.03(c)). If
Bank of America resigns as Swing Line Lender, it shall retain all the rights of
the Swing Line Lender provided for hereunder with respect to Swing Line Loans
made by it and outstanding as of the effective date of such resignation,
including the right to require the Lenders to make Base Rate Loans or fund risk
participations in outstanding Swing Line Loans pursuant to Section 2.04(c). Upon the
appointment of a successor LC Issuer and/or Swing Line Lender, (a) such
successor shall succeed to and become vested with all of the rights, powers,
privileges and duties of the retiring LC Issuer or Swing Line Lender, as the
case may be, and (b) the successor LC Issuer shall issue letters of credit in
substitution for the Letters of Credit, if any, outstanding at the time of such
succession or make other arrangements satisfactory to Bank of America to
effectively assume the obligations of Bank of America with respect to such
Letters of Credit.

          

          10.07     Treatment
of Certain Information; Confidentiality. Each of the Credit Parties
agrees to maintain
the confidentiality of the Information (as defined below), except that
Information may be disclosed (a) to its Affiliates and to its and its
Affiliates’ respective partners, directors, officers, employees, agents,
attorneys, advisors and representatives (it being understood that the Persons to
whom such disclosure is made will be informed of the confidential nature of such
Information and instructed to keep such Information confidential), (b) to the
extent requested by any regulatory authority purporting to have jurisdiction
over it (including any Federal Reserve Bank, any central bank or any
self-regulatory authority, such as the National Association of Insurance
Commissioners), (c) to the extent required by applicable Laws or regulations or
by any subpoena or similar legal process, provided that, if
lawful and

          

          
            
              
              

            

            
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          practicable to do so under the circumstances, the Lead Borrower is
given (with reasonable promptness) prior written notice of the request for
production of such Information, except for Information provided to regulators in
the ordinary course of bank regulatory oversight, (d) to any other party hereto,
(e) in connection with the exercise of any remedies hereunder or under any other
Loan Document or any action or proceeding relating to this Agreement or any
other Loan Document or the enforcement of rights hereunder or thereunder, (f)
subject to an agreement containing provisions substantially the same as those of
this Section, to (i) any assignee of or Participant in, or any prospective
assignee of or Participant in, any of its rights or obligations under this
Agreement or (ii) any actual or prospective counterparty (or its advisors) to
any swap or derivative transaction relating to any Loan Party and its
obligations, (g) with the consent of the Lead Borrower or (h) to the extent such
Information (x) becomes publicly available other than as a result of a breach of
this Section or (y) becomes available to any Credit Party or any of their
respective Affiliates on a non-confidential basis from a source other than the
Loan Parties.

          

          For
purposes of this Section, "Information" means all information received from the
Loan Parties or any Subsidiary thereof relating to the Loan Parties or any
Subsidiary thereof or their respective businesses, other than any such
information that is available to any Credit Party on a non-confidential basis
prior to disclosure by the Loan Parties or any Subsidiary thereof, provided
that, in the case of information received from any Loan Party or any Subsidiary
after the date hereof, such information is clearly identified at the time of
delivery as confidential. Any Person required to maintain the confidentiality of
Information as provided in this Section shall be considered to have complied
with its obligation to do so if such Person has exercised the same degree of
care to maintain the confidentiality of such Information as such Person would
accord to its own confidential information.

          

          Each of
the Credit Parties acknowledges that (a) the Information may include material
non-public information concerning the Loan Parties or a Subsidiary, as the case
may be, (b) it has developed compliance procedures regarding the use of material
non-public information and (c) it will handle such material non-public
information in accordance with applicable Law, including Federal and state
securities Laws.

          

          10.08     Right of
Setoff. If an
Event of Default shall have occurred and be continuing or if any Lender shall have been
served with a trustee process or similar attachment relating to property of a
Loan Party, each Lender, the LC Issuer and each of their respective Affiliates
is hereby authorized at any time and from time to time, after obtaining the
prior written consent of the Administrative Agent or the Required Lenders, to
the fullest extent permitted by applicable Law, to set off and apply any and all
deposits (general or special, time or demand, provisional or final, in whatever
currency) at any time held and other obligations (in whatever currency) at any
time owing by such Lender, the LC Issuer or any such Affiliate to or for the
credit or the account of the Borrowers or any other Loan Party against any and
all of the Secured Obligations now or hereafter existing under this Agreement or
any other Loan Document to such Lender or the LC Issuer, regardless of the
adequacy of the Collateral, and irrespective of whether or not such Lender or
the LC Issuer shall have made any demand under this Agreement or any other Loan
Document and although such obligations of the Borrowers or such Loan Party may
be contingent or unmatured or are owed to a branch or office of such Lender or
the LC Issuer different from the branch or office holding such deposit or
obligated on such indebtedness. The rights of each Lender, the LC Issuer and
their respective Affiliates under this Section are in addition to other rights
and remedies (including other rights of setoff) that such Lender, the LC Issuer
or their respective Affiliates may have. Each Lender and the LC Issuer agrees to
notify the Lead Borrower and the Administrative Agent promptly after any such
setoff and application, provided that the
failure to give such notice shall not affect the validity of such setoff and
application.

          

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

          

          
            
              
              

            

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

          

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

          

          10.11     Survival. All representations and
warranties made hereunder and in any other Loan Document
or other document delivered pursuant hereto or thereto or in connection herewith
or therewith shall survive the execution and delivery hereof and thereof. Such
representations and warranties have been or will be relied upon by the Credit
Parties, regardless of any investigation made by any Credit Party or on their
behalf and notwithstanding that any Credit Party may have had notice or
knowledge of any Default at the time of any Credit Extension, and shall continue
in full force and effect as long as any Loan or any other Obligation hereunder
shall remain unpaid or unsatisfied or any Letter of Credit shall remain
outstanding. Further, the provisions of Sections 3.01, 3.04, 3.05 and 10.04 and Article IX shall
survive and remain in full force and effect regardless of the repayment of the
Secured Obligations, the expiration or termination of the Letters of Credit and
the Commitments or the termination of this Agreement or any provision hereof. In
connection with the termination of this Agreement and the release and
termination of the security interests in the Collateral, the Agents may require
such indemnities and collateral security as they shall reasonably deem necessary
or appropriate to protect the Credit Parties against (x) loss on account of
credits previously applied to the Secured Obligations that may subsequently be
reversed or revoked, and (y) any obligations that may thereafter arise with
respect to or under Section 10.04
hereof.

          

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

          

          10.13     Replacement
of Lenders. If
any Lender requests compensation under Section 3.04, or
if the
Borrowers are required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section 3.01, or if
any Lender is a Defaulting Lender or a Non-Consenting Lender, then the Borrowers
may, at their sole expense and effort, upon notice to such Lender and the
Administrative Agent, require such Lender to assign and delegate, without
recourse (in accordance with and subject to the restrictions contained in, and
consents required by, Section 10.06),
all

          

          
            
              
              

            

            
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          of its interests, rights and obligations under this Agreement and
the related Loan Documents to an assignee that shall assume such obligations
(which assignee may be another Lender, if a Lender accepts such assignment),
provided
that:

          

          (a)           the
Borrowers shall have paid to the Administrative Agent the assignment fee
specified in Section
10.06(b);

          

          (b)           such
Lender shall have received payment of an amount equal to the outstanding
principal of its Loans and LC Advances, accrued interest thereon, accrued fees
and all other amounts payable to it hereunder and under the other Loan Documents
(including any amounts under Section 3.05) from
the assignee (to the extent of such outstanding principal and accrued interest
and fees) or the Borrowers (in the case of all other amounts);

          

          (c)           in
the case of any such assignment resulting from a claim for compensation under
Section 3.04 or
payments required to be made pursuant to Section 3.01, such
assignment will result in a reduction in such compensation or payments
thereafter; and

           

          (d)         
such
assignment does not conflict with applicable Laws.

          

          A Lender
shall not be required to make any such assignment or delegation if, prior
thereto, as a result of a waiver by such Lender or otherwise, the circumstances
entitling the Borrowers to require such assignment and delegation cease to
apply.

          

          10.14     Governing
Law; Jurisdiction; Etc.

          

          (a)        
 GOVERNING
LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK (EXCEPT FOR THE CONFLICT OF LAWS RULES
THEREOF, BUT INCLUDING GENERAL OBLIGATIONS LAW SECTIONS 5-1401 AND
5-1402).

          

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

          

          (c)         
WAIVER OF
VENUE. EACH LOAN PARTY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE

          

          
            
              
              

            

            
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          LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING
OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT IN ANY COURT REFERRED TO IN SECTION 10.14(b).
EACH LOAN PARTY HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE
MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.

          

          (d)        
 SERVICE OF
PROCESS. EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN
THE MANNER PROVIDED FOR NOTICES IN SECTION 10.02.
NOTHING IN THIS AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE
PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW.

          

          (e)       
 ACTIONS
COMMENCED BY LOAN PARTIES. EACH LOAN PARTY AGREES THAT ANY ACTION
COMMENCED BY ANY LOAN PARTY ASSERTING ANY CLAIM OR COUNTERCLAIM ARISING UNDER OR
IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT SHALL BE BROUGHT
SOLELY IN A COURT OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY OR THE
UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK AS THE
ADMINISTRATIVE AGENT MAY ELECT IN ITS SOLE DISCRETION AND CONSENTS TO THE
EXCLUSIVE JURISDICTION OF SUCH COURTS WITH RESPECT TO ANY SUCH
ACTION.

          

          10.15     Waiver of
Jury Trial. EACH
PARTY HERETO HEREBY IRREVOCABLY WAIVES,
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER
THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE
BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG
OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION
10.15.

          

          10.16     No
Advisory or Fiduciary Responsibility. In connection with all aspects of
each transaction
contemplated hereby, the Loan Parties each acknowledge and agree that: (i) the
credit facility provided for hereunder and any related arranging or other
services in connection therewith (including in connection with any amendment,
waiver or other modification hereof or of any other Loan Document) are an
arm’s-length commercial transaction between the Loan Parties, on the one hand,
and the Credit Parties, on the other hand, and each of the Loan Parties is
capable of evaluating and understanding and understands and accepts the terms,
risks and conditions of the transactions contemplated hereby and by the other
Loan Documents (including any amendment, waiver or other modification hereof or
thereof); (ii) in
connection with the process leading to such transaction, except as otherwise
agreed by the Lead Borrower and any Credit Party in writing, each Credit Party
is and has been acting solely as a principal and is not the financial advisor,
agent or fiduciary, for the Loan Parties or any of their respective Affiliates,
stockholders, creditors or employees or any other Person; (iii) unless otherwise
agreed by the Lead Borrower and any Credit Party in writing, none of the Credit
Parties has assumed or will assume an advisory responsibility in favor of the
Loan Parties with respect to any of the transactions contemplated hereby or the
process leading thereto, including with respect to any amendment, waiver or
other modification hereof or of any other Loan Document (irrespective of whether
any of the Credit Parties has advised or is currently advising any Loan Party or
any of its Affiliates on other matters) and none of the

          

          
            
              
              

            

            
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          Credit Parties has any obligation to any Loan Party or any of its
Affiliates with respect to the transactions contemplated hereby except those
obligations expressly set forth herein and in the other Loan Documents; (iv) no
Credit Party has assumed or will assume an agency responsibility (except as may
otherwise be agreed in writing by the Lead Borrower and any Credit Party) or
fiduciary responsibility in any Loan Party's or its Affiliates’ favor with
respect to any of the transactions contemplated hereby (including with respect
to any amendment, waiver or other modification hereof or of any other Loan
Document) or the process leading thereto (irrespective of whether any Credit
Party has advised or is currently advising you or your affiliates on other
matters); (v) the Credit Parties and their respective Affiliates may be engaged
in a broad range of transactions that involve interests that differ from those
of the Loan Parties and their respective Affiliates, and none of the Credit
Parties has any obligation to disclose any of such interests by virtue of any
advisory, agency or fiduciary relationship; and (vi) the Credit Parties have not
provided and will not provide any legal, accounting, regulatory or tax advice
with respect to any of the transactions contemplated hereby (including any
amendment, waiver or other modification hereof or of any other Loan Document)
and each of the Loan Parties has consulted its own legal, accounting, regulatory
and tax advisors to the extent it has deemed appropriate. Each of the Loan
Parties hereby waives and releases, to the fullest extent permitted by law, any
claims that it may have against each of the Credit Parties with respect to any
breach or alleged breach of agency (except for any agency responsibilities
otherwise agreed by the Lead Borrower and any Credit Party in writing) or
fiduciary duty.

          

          10.17     USA
PATRIOT Act Notice.
Each Lender that is subject to the Patriot Act and the Administrative
Agent (for itself and not on behalf of any Lender) hereby notifies the Loan
Parties that pursuant to the requirements of the Patriot Act, it is required to
obtain, verify and record information that identifies each Loan Party, which
information includes the name and address of each Loan Party and other
information that will allow such Lender or the Administrative Agent, as
applicable, to identify each Loan Party in accordance with the Patriot Act. Each
Loan Party is in compliance, in all material respects, with the Patriot Act. No
part of the proceeds of the Loans will be used by the Loan Parties, directly or
indirectly, for any payments to any governmental official or employee, political
party, official of a political party, candidate for political office, or anyone
else acting in an official capacity, in order to obtain, retain or direct
business or obtain any improper advantage, in violation of the United States
Foreign Corrupt Practices Act of 1977, as amended.

          

          10.18    
Foreign
Assets Control Regulations. Neither of the advance of
the Loans nor the use of the
proceeds of any thereof will violate the Trading With the Enemy Act (50 U.S.C. §
1 et seq., as amended) (the "Trading With the Enemy
Act") or any of the foreign assets control regulations of the United
States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) (the
"Foreign Assets
Control
Regulations") or any enabling legislation or executive order relating
thereto (which for the avoidance of
doubt shall include, but shall not be limited to (a) Executive Order 13224 of
September 21, 2001 Blocking Property and Prohibiting Transactions With Persons
Who Commit, Threaten to Commit, or Support Terrorism (66 Fed. Reg. 49079 (2001))
(the "Executive
Order") and (b) the Patriot Act. Furthermore, none of the Borrowers or
their Affiliates (a) is or will become a "blocked person" as described in the
Executive Order, the Trading With the Enemy Act or the Foreign Assets Control
Regulations or (b) engages or will engage in any dealings or transactions, or be
otherwise associated, with any such "blocked person" or in any manner violative
of any such order.

          

          
            10.19   
 Time of
the Essence. Time
is of the essence of the Loan Documents.

          

          

          10.20     Press
Releases. Subject to prior notification and consent by the Lead Borrower
(which consent
shall not be unreasonably withheld) to the form of advertising materials to be
used from time to time, the Administrative Agent and any Lender shall be
permitted to use a Loan Party’s name, product photographs, logo or trademark in
any advertising material relating to the financing transactions contemplated by
this Agreement. The Administrative Agent or such Lender shall provide a draft of
any

          

          
            
              
              

            

            
              134

              
                

              

            

            
              
              

            

          

           

          advertising material to the Lead Borrower for review and comment
reasonably prior to the initial publication thereof. The Administrative Agent
reserves the right to provide to industry trade organizations information
necessary and customary for inclusion in league table
measurements.

          

          10.21     Additional
Waivers.

          

          (a)         
The Secured Obligations are the joint and several obligation of each Loan Party.
To the fullest extent permitted by applicable Law, the Secured Obligations of
each Loan Party shall not be affected by (i) the failure of any Credit Party to
assert any claim or demand or to enforce or exercise any right or remedy against
any other Loan Party under the provisions of this Agreement, any other Loan
Document or otherwise, (ii) any rescission, waiver, amendment or modification
of, or any release from any of the terms or provisions of, this Agreement or any
other Loan Document, or (iii) the failure to perfect any security interest in,
or the release of, any of the Collateral or other security held by or on behalf
of the Collateral Agent or any other Credit Party.

          

          (b)          The
obligations of each Loan Party shall not be subject to any reduction,
limitation, impairment or termination for any reason (other than the
indefeasible payment in full in cash of the Secured Obligations after the
termination of the Commitments), including any claim of waiver, release,
surrender, alteration or compromise of any of the Secured Obligations, and shall
not be subject to any defense or setoff, counterclaim, recoupment or termination
whatsoever by reason of the invalidity, illegality or unenforceability of any of
the Secured Obligations or otherwise. Without limiting the generality of the
foregoing, the obligations of each Loan Party hereunder shall not be discharged
or impaired or otherwise affected by the failure of any Agent or any other
Credit Party to assert any claim or demand or to enforce any remedy under this
Agreement, any other Loan Document or any other agreement, by any waiver or
modification of any provision of any thereof, any default, failure or delay,
willful or otherwise, in the performance of any of the Secured Obligations, or
by any other act or omission that may or might in any manner or to any extent
vary the risk of any Loan Party or that would otherwise operate as a discharge
of any Loan Party as a matter of law or equity (other than the indefeasible
payment in full in cash of all the Secured Obligations after the termination of
the Commitments).

          

          (c)         
To the fullest extent permitted by applicable Law, each Loan Party waives any
defense based on or arising out of any defense of any other Loan Party or the
unenforceability of the Secured Obligations or any part thereof from any cause,
or the cessation from any cause of the liability of any other Loan Party, other
than the indefeasible payment in full in cash of all the Secured Obligations and
the termination of the Commitments. The Collateral Agent and the other Credit
Parties may, at their election, foreclose on any security held by one or more of
them by one or more judicial or non-judicial sales, accept an assignment of any
such security in lieu of foreclosure, compromise or adjust any part of the
Secured Obligations, make any other accommodation with any other Loan Party, or
exercise any other right or remedy available to them against any other Loan
Party, without affecting or impairing in any way the liability of any Loan Party
hereunder except to the extent that all the Secured Obligations have been
indefeasibly paid in full in cash and the Commitments have been terminated. Each
Loan Party waives any defense arising out of any such election even though such
election operates, pursuant to applicable Law, to impair or to extinguish any
right of reimbursement or subrogation or other right or remedy of such Loan
Party against any other Loan Party, as the case may be, or any
security.

          

          (d)         
Each Borrower is obligated to repay the Obligations as joint and several
obligors under this Agreement. Upon payment by any Loan Party of any Secured
Obligations, all rights of such Loan Party against any other Loan Party arising
as a result thereof by way of right of subrogation, contribution, reimbursement,
indemnity or otherwise shall in all respects be subordinate and junior in right
of payment to the prior indefeasible payment in full in cash of all the Secured
Obligations and the

          

          
            
              
              

            

            
              135

              
                

              

            

            
              
              

            

          

           

          termination of the Commitments. In addition, any indebtedness of
any Loan Party now or hereafter held by any other Loan Party is hereby
subordinated in right of payment to the prior indefeasible payment in full of
the Secured Obligations and no Loan Party will demand, sue for or otherwise
attempt to collect any such indebtedness. If any amount shall erroneously be
paid to any Loan Party on account of (i) such subrogation, contribution,
reimbursement, indemnity or similar right or (ii) any such indebtedness of any
Loan Party, such amount shall be held in trust for the benefit of the Credit
Parties and shall forthwith be paid to the Administrative Agent to be credited
against the payment of the Secured Obligations, whether matured or unmatured, in
accordance with the terms of this Agreement and the other Loan Documents.
Subject to the foregoing, to the extent that any Borrower shall, under this
Agreement as a joint and several obligor, repay any of the Obligations
constituting Revolving Loans made to another Borrower hereunder or other Secured
Obligations incurred directly and primarily by any other Borrower (an "Accommodation Payment"), then the
Borrower making such Accommodation Payment shall be entitled to contribution
and indemnification
from, and be reimbursed by, each of the other Borrowers in an amount, for each
of such other Borrowers, equal to a fraction of such Accommodation Payment, the
numerator of which fraction is such other Borrower's Allocable Amount and the
denominator of which is the sum of the Allocable Amounts of all of the
Borrowers. As of any date of determination, the "Allocable Amount" of
each Borrower shall be equal to the maximum amount of liability for
Accommodation Payments which could be asserted against such Borrower hereunder
without (a) rendering such Borrower "insolvent" within the meaning of Section
101 (31) of the Bankruptcy Code, Section 2 of the Uniform Fraudulent Transfer
Act ("UFTA") or
Section 2 of the Uniform Fraudulent Conveyance Act ("UFCA"), (b) leaving
such Borrower with unreasonably small capital or assets, within the meaning of
Section 548 of the Bankruptcy Code, Section 4 of the UFTA, or Section 5 of the
UFCA, or (c) leaving such Borrower unable to pay its debts as they become due
within the meaning of Section 548 of the Bankruptcy Code or Section 4 of the
UFTA, or Section 5 of the UFCA.

          

          (e)         
Without limiting the generality of the foregoing, or of any other waiver or
other provision set forth in this Agreement, each Loan Party hereby absolutely,
knowingly, unconditionally, and expressly waives any and all claim, defense or
benefit arising directly or indirectly under any one or more of Sections 2787 to
2855 inclusive of the California Civil Code or any similar law of
California.

          

          10.22     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.

          

          10.23     Attachments.
The exhibits, schedules and annexes attached to this Agreement are incorporated
herein and shall be considered a part of this Agreement for the purposes stated
herein, except that in the event of any conflict between any of the provisions
of such exhibits and the provisions of this Agreement, the provisions of this
Agreement shall prevail.

          

          10.24     Copies
and Facsimiles.
This Agreement and all other documents (including, without limitation,
the Loan Documents) which have been or may be hereinafter furnished by any Loan
Party to any Agent or any Lender may be reproduced by such Agent or such Lender
by any photographic, microfilm, xerographic, digital imaging, or other process.
Any such reproduction shall be admissible in evidence as the original itself in
any judicial or administrative proceeding (whether or not the original is in
existence and whether or not such reproduction was made in the regular course of
business). Any facsimile which bears proof of transmission shall be binding on
the party which or on whose behalf such transmission was initiated and likewise
so admissible in evidence as if the original of such facsimile had been
delivered to the party which or on whose behalf such transmission was
received.

          

          
            
              
              

            

            
              136

              
                

              

            

            
              
              

            

          

           

          ARTICLE XI

          GUARANTY

          

          11.01       Guaranty.
Each Guarantor hereby agrees that it is jointly and severally liable for,
and, as
primary obligor and not merely as surety, and absolutely and unconditionally
guarantees to the Lenders the prompt payment when due, whether at stated
maturity, upon acceleration or otherwise, and at all times thereafter, of the
Secured Obligations (collectively the “Guaranteed
Obligations”). Each Guarantor further agrees that the Guaranteed
Obligations may be extended or renewed in whole or in part without notice to or
further assent from it, and that it remains bound upon its guarantee
notwithstanding any such extension or renewal.

          

          11.02       Guaranty
of Payment. This Facility Guaranty is a guaranty of payment and not
of collection.
Each Guarantor waives any right to require any Agent, any LC Issuer or any
Lender to sue any Borrower, any Guarantor, any other guarantor, or any other
Person obligated for all or any part of the Guaranteed Obligations (each, an
“Obligated
Party”), or otherwise to enforce its payment against any collateral
securing all or any part of the Guaranteed Obligations.

          

          
            11.03       No
Discharge or Diminishment of Facility Guaranty.

          

          

          (a)           Except
as otherwise provided for herein, the obligations of each Guarantor hereunder
are unconditional and absolute and not subject to any reduction, limitation,
impairment or termination for any reason (other than the Guaranteed Obligations
being Fully Satisfied), including: (i) any claim of waiver, release, extension,
renewal, settlement, surrender, alteration, or compromise of any of the
Guaranteed Obligations, by operation of law or otherwise; (ii) any change in the
corporate existence, structure or ownership of any Borrower or any other
guarantor of or other Person liable for any of the Guaranteed Obligations; (iii)
any insolvency, bankruptcy, reorganization or other similar proceeding affecting
any Obligated Party, or their assets or any resulting release or discharge of
any obligation of any Obligated Party; or (iv) the existence of any claim,
setoff or other rights which any Guarantor may have at any time against any
Obligated Party, any Agent, any LC Issuer, any Lender, or any other Person,
whether in connection herewith or in any unrelated transactions.

          

          

          (b)           The
obligations of each Guarantor hereunder are not subject to any defense or
setoff, counterclaim, recoupment, or termination whatsoever by reason of the
invalidity, illegality, or unenforceability of any of the Guaranteed Obligations
or otherwise, or any provision of applicable law or Regulation purporting to
prohibit payment by any Obligated Party, of the Guaranteed Obligations or any
part thereof.

          

          Further,
the obligations of any Guarantor hereunder are not discharged or impaired or
otherwise affected by: (i) the failure of any Agent, any LC Issuer or any Lender
to assert any claim or demand or to enforce any remedy with respect to all or
any part of the Guaranteed Obligations; (ii) any waiver or modification of or
supplement to any provision of any agreement relating to the Guaranteed
Obligations; (iii) any release, non-perfection, or invalidity of any indirect or
direct security for the obligations of each Borrower for all or any part of the
Guaranteed Obligations or any obligations of any other guarantor of or other
Person liable for any of the Guaranteed Obligations; (iv) any action or failure
to act by any Agent, any LC Issuer or any Lender with respect to any collateral
securing any part of the Guaranteed Obligations; or (v) any default, failure or
delay, willful or otherwise, in the payment or performance of any of the
Guaranteed Obligations, or any other circumstance, act, omission or delay that
might in any manner or to any extent vary the risk of such Guarantor or that
would otherwise operate as a discharge of any Guarantor as a matter of law or
equity (other than the Secured Obligations being Fully Satisfied).

          

          
            
              
              

            

            
              137

              
                

              

            

            
              
              

            

          

          

          11.04       Defenses
Waived. To the fullest extent permitted by applicable law, each
Guarantor hereby
waives any defense based on or arising out of any defense of any Borrower or any
Guarantor or the unenforceability of all or any part of the Guaranteed
Obligations from any cause, or the cessation from any cause of the liability of
any Borrower or any Guarantor, other than the Guaranteed Obligations being Fully
Satisfied. Without limiting the generality of the foregoing, each Guarantor
irrevocably waives acceptance hereof, presentment, demand, protest and, to the
fullest extent permitted by law, any notice not provided for herein, as well as
any requirement that at any time any action be taken by any Person against any
Obligated Party, or any other Person. The Agent may, at its election, foreclose
on any Collateral held by it by one or more judicial or nonjudicial sales,
accept an assignment of any such Collateral in lieu of foreclosure or otherwise
act or fail to act with respect to any collateral securing all or a part of the
Guaranteed Obligations, compromise or adjust any part of the Guaranteed
Obligations, make any other accommodation with any Obligated Party or exercise
any other right or remedy available to it against any Obligated Party, without
affecting or impairing in any way the liability of such Guarantor under this
Facility Guaranty except to the extent the Guaranteed Obligations have been
fully and indefeasibly paid in cash. To the fullest extent permitted by
applicable law, each Guarantor waives any defense arising out of any such
election even though that election may operate, pursuant to applicable law, to
impair or extinguish any right of reimbursement or subrogation or other right or
remedy of any Guarantor against any Obligated Party or any
security.

          

          11.05       Rights of
Subrogation. No Guarantor will assert any right, claim or cause of
action, including,
without limitation, a claim of subrogation, contribution or indemnification that
it has against any Obligated Party, or any collateral, until the Loan Parties
and the Guarantors have fully performed all their obligations to the Agents, the
LC Issuers and the Lenders.

          

          11.06       Reinstatement;
Stay of Acceleration. If at any time any payment of any portion of
the Guaranteed
Obligations is rescinded or must otherwise be restored or returned upon the
insolvency, bankruptcy, or reorganization of any Borrower or otherwise, each
Guarantor’s obligations under this Facility Guaranty with respect to that
payment shall be reinstated at such time as though the payment had not been
made. If acceleration of the time for payment of any of the Guaranteed
Obligations is stayed upon the insolvency, bankruptcy or reorganization of any
Borrower, all such amounts otherwise subject to acceleration under the terms of
any agreement relating to the Guaranteed Obligations shall nonetheless be
payable by the Guarantors forthwith on demand by the Lender.

          

          11.07        Information.
Each Guarantor assumes all responsibility for being and keeping itself informed
of each Borrower’s financial condition and assets, and of all other
circumstances bearing upon the risk of nonpayment of the Guaranteed Obligations
and the nature, scope and extent of the risks that each Guarantor assumes and
incurs under this Facility Guaranty, and agrees that none of the Agents, any LC
Issuer or any Lender shall have any duty to advise any Guarantor of information
known to it regarding those circumstances or risks.

          

          11.08       Taxes.
All payments of the Guaranteed Obligations will be made by each Guarantor
free and
clear of and without deduction for any Indemnified Taxes or Other Taxes; provided that if any
Guarantor shall be required to deduct any Indemnified Taxes or Other Taxes from
such payments, then (i) the sum payable shall be increased as necessary so that
after making all required deductions (including deductions applicable to
additional sums payable under this Section) each Agent, Lender or LC Issuer (as
the case may be) receives an amount equal to the sum it would have received had
no such deductions been made, (ii) such Guarantor shall make such deductions and
(iii) such Guarantor shall pay the full amount deducted to the relevant
Governmental Authority in accordance with applicable law.

          

          11.09       Maximum
Liability. The provisions of this Facility Guaranty are severable, and in
any action
or proceeding involving any state corporate law, or any state, Federal or
foreign bankruptcy,

          

          
            
              
              

            

            
              138

              
                

              

            

            
              
              

            

          

           

          insolvency, reorganization or other law affecting the rights of
creditors generally, if the obligations of any Guarantor under this Facility
Guaranty would otherwise be held or determined to be avoidable, invalid or
unenforceable on account of the amount of such Guarantor’s liability under this
Facility Guaranty, then, notwithstanding any other provision of this Facility
Guaranty to the contrary, the amount of such liability shall, without any
further action by the Guarantors or the Lenders, be automatically limited and
reduced to the highest amount that is valid and enforceable as determined in
such action or proceeding (such highest amount determined hereunder being the
relevant Guarantor’s “Maximum Liability”).
This Section 11.09
with respect to the Maximum Liability of each Guarantor is intended
solely to preserve the rights of the
Lenders to the maximum extent not subject to avoidance under applicable law, and
no Guarantor nor any other Person or entity shall have any right or claim under
this Section with respect to such Maximum Liability, except to the extent
necessary so that the obligations of any Guarantor hereunder shall not be
rendered voidable under applicable law. Each Guarantor agrees that the
Guaranteed Obligations may at any time and from time to time exceed the Maximum
Liability of each Guarantor without impairing this Facility Guaranty or
affecting the rights and remedies of the Lenders hereunder, provided, that
nothing in this sentence shall be construed to increase any Guarantor’s
obligations hereunder beyond its Maximum Liability. Notwithstanding the
foregoing, nothing contained in this Agreement (including any provisions of this
Article XI to
the contrary) shall limit the liability of the Borrowers in respect of all of
the Secured Obligations.

          

          11.10     Contribution.
In the event any Guarantor (a “Paying Guarantor”)
shall make any payment
or payments under this Facility Guaranty or shall suffer any loss as a result of
any realization upon any collateral granted by it to secure its obligations
under this Facility Guaranty, each other Guarantor (each a “Non-Paying
Guarantor”) shall contribute to such Paying Guarantor an amount equal to
such Non-Paying Guarantor’s “Guarantor Percentage” of such payment or payments
made, or losses suffered, by such Paying Guarantor. For purposes of this Article XI, each
Non-Paying Guarantor’s “Guarantor Percentage”
with respect to any such payment or loss by a Paying Guarantor shall be
determined as of the date on which such payment or loss was made by reference to
the ratio of (i) such Non-Paying Guarantor’s Maximum Liability as of such date
(without giving effect to any right to receive, or obligation to make, any
contribution hereunder) or, if such Non-Paying Guarantor’s Maximum Liability has
not been determined, the aggregate amount of all monies received by such
Non-Paying Guarantor from any Borrower after the date hereof (whether by loan,
capital infusion or by other means) to (ii) the aggregate Maximum Liability of
all Guarantors hereunder (including such Paying Guarantor) as of such date
(without giving effect to any right to receive, or obligation to make, any
contribution hereunder), or to the extent that a Maximum Liability has not been
determined for any Guarantor, the aggregate amount of all monies received by
such Guarantors from any Borrower after the date hereof (whether by loan,
capital infusion or by other means). Nothing in this provision shall affect any
Guarantor’s several liability for the entire amount of the Guaranteed
Obligations (up to such Guarantor’s Maximum Liability). Each of the Guarantors
covenants and agrees that its right to receive any contribution under this
Facility Guaranty from a Non-Paying Guarantor shall be subordinate and junior in
right of payment to the Guaranteed Obligations being Fully Satisfied. This
provision is for the benefit of all of the Agents, the LC Issuer, the Lenders,
the Borrowers and the Guarantors and may be enforced by any one, or more, or all
of them in accordance with the terms hereof.

          

          11.11     Liability
Cumulative. The liability of each Loan Party as a Guarantor under
this Article XI is in
addition to and shall be cumulative with all liabilities of each Loan Party to
the Agents, the LC Issuer
and the Lenders under this Agreement and the other Loan Documents to which such
Loan Party is a party or in respect of any obligations or liabilities of the
other Loan Parties, without any limitation as to amount, unless the instrument
or agreement evidencing or creating such other liability specifically provides
to the contrary.

          

          
            
              
              

            

            
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          11.12     Release
of Guarantors and Borrowers. Notwithstanding anything in Section 10.01(g) to the contrary (i) a
Guarantor or a Borrower that is a Subsidiary shall automatically be released
from its obligations hereunder and its Facility Guaranty and obligations as a
Borrower shall be automatically released upon the consummation of any
transaction permitted hereunder as a result of which such Guarantor or Borrower
ceases to be a Subsidiary of the Lead Borrower and (ii) so long as no Event of
Default has occurred and is continuing, if a Guarantor or Borrower is or becomes
an Immaterial Subsidiary, and such release would not result in any Immaterial
Subsidiary being required pursuant to Section 6.12(d) to
become a Loan Party hereunder (except to the extent that on and as of the date
of such release, one or
more other Immaterial Subsidiaries become Guarantors or Borrowers hereunder and
the provisions of Section 6.12(d) are
satisfied upon giving effect to all such additions and releases), such Guarantor
shall be automatically released from its obligations hereunder and its Facility
Guaranty and obligations as a Borrower shall be automatically released upon
notification thereof from the Lead Borrower to the Agent. In connection with any
such release, the Agent shall execute and deliver to any Guarantor or Borrower
that is a Subsidiary, at such Guarantor’s or Borrower’s expense, all documents
that such Guarantor or Borrower shall reasonably request to evidence termination
or release. Any execution and delivery of documents pursuant to the preceding
sentence of this Section 11.12 shall
be without recourse to or warranty by the Agent.

          

          

          [Signature
pages follow]

          

          

          
            
              
              

            

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

          

          
             

             

            
              	
                      BORROWERS:
      

                       

                      BARNES
      & NOBLE, INC.

                    	 
	 	 	 	 
	By:	/s/ Joseph J.
      Lombardi	 
	Name:
      	Joseph J.
      Lombardi	 
	Title:
      	Chief Financial
      Officer	 

            

            
               

              
                
                  	BARNES
      & NOBLE COLLEGE BOOKSELLERS, INC.	 
	 	 	 
	By:	/s/ Barry
      Brover	 
	Name:
      	Barry
    Brover	 
	Title:
      	VP
      CFO	 

                

              

            

          

           

          
            
               

               

               

              
                	
                        
                          B.
      DALTON BOOKSELLER, LLC

                          BARNES
      & NOBLE BOOKQUEST LLC

                          BARNES
      & NOBLE BOOKSELLERS, INC.

                          BARNES
      & NOBLE MARKETING SERVICES

                          CORP.

                          BARNES
      & NOBLE PURCHASING, INC.

                          BARNES
      & NOBLE SERVICES, INC.

                          BARNESANDNOBLE.COM
      LLC

                          DOUBLEDAY
      BOOK SHOPS, INC.

                          FICTIONWISE
      LLC

                          PONDVIEW
      ASSOCIATES LLC

                          SPARKNOTES
      LLC

                          STERLING
      PUBLISHING CO., INC.

                          TKTK
      ACQUISITION LLC

                        

                      

              

               

              
                
                  	By:	/s/ Joseph J.
      Lombardi	 
	Name:
      	Joseph J.
      Lombardi	 
	Title:
      	Chief Financial
      Officer	 

                

              

              
                 

                 

                
                  
                    	BNCB MERGER
      SUB, LLC	 
	 	 
	By:	/s/ Joseph J.
      Lombardi	 
	Name:
      	Joseph J.
      Lombardi	 
	Title:
      	Senior Vice
      President	 

                  

                

              

               

            

            
 

          

          

          Credit
Agreement

          Signature
Page

           

           

          
            
              
              

            

            
              
              

              
                

              

            

            
              
              

            

             

            
              
                 

                
                  	
                          
                            BANK OF
      AMERICA, N.A.,

                            as
      Administrative Agent and as Collateral Agent

                          

                        	 
	 	 	 	 

                

                
                  	By:	/s/ James
      Ward	 
	Name:
      	James Ward	 
	Title:
      	Managing
      Director	 

                

                
 

              

            

          

          

          
             

             

             

            
 

            

            Credit
Agreement

            Signature
Page

          

           

          
            
              
              

            

            
              
              

              
                

              

            

            
              
              

            

             

          

          
            
              
                
                  	
                          
                            
                              JPMORGAN
      CHASE BANK, N.A.,

                              as
      Co-Syndication Agent

                            

                          

                        	 

                

                 

                
                  
                    	By:	/s/ Kathleen C.
      Maggi	 
	Name:
      	Kathleen C.
      Maggi	 
	Title:
      	Senior Vice
      President	 

                  

                

                
 

              

            

            

             

             

             

            
              

              Credit
Agreement

              Signature
Page 

            

          

          
             

            
              
                
                

              

              
                
                

                
                  

                

              

              
                
                

              

               

              
                
                  
                    
                      	
                              
                                
                                  WELLS FARGO RETAIL FINANCE,
      LLC.,

                                  as
      Co-Syndication Agent

                                

                              

                            	 

                    

                     

                    
                      
                        	By:	/s/ Cory
      Loftus	 
	Name:
      	Cory
      Loftus	 
	Title:
      	Vice
    President	 

                      

                    

                    
 

                  

                

                 

                 

                
 

                 

                
                  

                  Credit
Agreement

                  Signature
Page 

                

              

               

              
                
                  
                  

                

                
                  
                  

                  
                    

                  

                

                
                  
                  

                

                 

                
                  
                    
                      
                        	
                                
                                  
                                    SUNTRUST BANK,

                                    as
      Co-Documenttion Agent

                                  

                                

                              	 

                      

                       

                      
                        
                          	By:	/s/ B. Earl
      Garris	 
	Name:
      	B.
      Earl Garris	 
	Title:
      	Director,
      CIB-ABL	 

                        

                      

                      
 

                    

                  

                   

                   

                  
 

                   

                  
                    

                    Credit
Agreement

                    Signature
Page

                     

                  

                

                 

                 

                
                  
                    
                    

                  

                  
                    
                    

                    
                      

                    

                  

                  
                    
                    

                  

                   

                  
                    
                      
                        
                          	
                                  
                                    
                                      US BANK, NATIONAL
      ASSOCIATION,

                                      as
      Co-Documentation Agent

                                    

                                  

                                	 

                        

                         

                        
                          
                            	By:	/s/ Blake
      Malia	 
	Name:
      	Blake
Malia	 
	Title:
      	Assistant Vice
      President	 

                          

                        

                        
 

                      

                    

                    

                     

                     

                     

                     

                     

                    
                      

                      Credit
Agreement

                      Signature
Page 

                    

                  

                   

                  
                    
                      
                      

                    

                    
                      
                      

                      
                        

                      

                    

                    
                      
                      

                       

                      
                        
                          
                            
                              	
                                      
                                        
                                          REGIONS BANK,

                                          as
      Co-Senior Managing Agent

                                        

                                      

                                    	 

                            

                             

                            
                              
                                	By:	/s/ Bruce
      Kasper	 
	Name:
      	Bruce
    Kasper	 
	Title:
      	Attorney in
      Fact	 

                              

                            

                            
 

                          

                        

                        

                         

                         

                         

                         

                         

                        
                          

                          Credit
Agreement

                          Signature
Page 

                        

                      

                       

                      
                        
                          
                          

                        

                        
                          
                          

                          
                            

                          

                        

                        
                          
                          

                           

                          
                            
                              
                                
                                  	
                                          
                                            
                                              SOVEREIGN BANK,

                                              as
      Co-Senior Managing Agent

                                            

                                          

                                        	 

                                

                                 

                                
                                  
                                    	By:	/s/ Matilde
      Reyes	 
	Name:
      	Matilde
    Reyes	 
	Title:
      	SVP	 

                                  

                                

                                
 

                              

                            

                            

                             

                             

                             

                             

                             

                            
                              

                              Credit
Agreement

                              Signature
Page 

                            

                          

                           

                          
                            
                              
                              

                            

                            
                              
                              

                              
                                

                              

                            

                            
                              
                              

                            

                          

                        

                      

                    

                  

                

              

               

               

            

            
              
                
                  	
                          
                            
                              BANK OF
      AMERICA, N.A.,

                              as
      a Lender, LC Issuer and Swing Line Lender

                            

                          

                        	 

                

                 

                
                  
                    	By:	/s/ James
      Ward	 
	Name:
      	James Ward	 
	Title:
      	Managing
      Director	 

                  

                

                
 

              

            

             

             

             

            
 

          

           

          
            

            Credit
Agreement

            Signature
Page

             

              
                
                  
                  

                

                
                  
                  

                  
                    

                  

                

                
                  
                  

                

              

            

          

        

      

       

      
         

        
          
            
              
                	
                        
                          
                            JPMORGAN
      CHASE BANK, N.A.,

                            as
      a Lender and LC Issuer

                          

                        

                      	 

              

               

              
                
                  	By:	/s/ Kathleen C.
      Maggi	 
	Name:
      	Kathleen C.
      Maggi	 
	Title:
      	Senior Vice
      President	 

                

              

              
 

            

          

          

           

           

           

          
            

            Credit
Agreement

            Signature
Page 

          

        

        
           

          
            
              
              

            

            
              
              

              
                

              

            

            
              
              

            

             

            
              
                
                  
                    	
                            
                              
                                WELLS FARGO RETAIL FINANCE,
      LLC.,

                                as
      a Lender and LC Issuer

                              

                            

                          	 

                  

                   

                  
                    
                      	By:	/s/ Cory
      Loftus	 
	Name:
      	Cory
      Loftus	 
	Title:
      	Vice
    President	 

                    

                  

                  
 

                

              

               

               

              
 

               

              
                

                Credit
Agreement

                Signature
Page 

              

            

             

            
              
                
                

              

              
                
                

                
                  

                

              

              
                
                

                 

                
                  
                    
                      
                        	
                                
                                  
                                    SOVEREIGN BANK,

                                    as
      a Lender and LC Issuer

                                  

                                

                              	 

                      

                       

                      
                        
                          	By:	/s/ Matilde
      Reyes	 
	Name:
      	Matilde
    Reyes	 
	Title:
      	SVP	 

                        

                      

                      
 

                    

                  

                  

                   

                   

                   

                   

                   

                  
                    

                    Credit
Agreement

                    Signature
Page 

                  

                

                 

                
                  
                    
                    

                  

                  
                    
                    

                    
                      

                    

                  

                  
                    
                    

                  

                

              

               

              
                
                  
                    
                      	
                              
                                
                                  SUNTRUST BANK,

                                  as
      a Lender 

                                

                              

                            	 

                    

                     

                    
                      
                        	By:	/s/ B. Earl
      Garris	 
	Name:
      	B.
      Earl Garris	 
	Title:
      	Director,
      CIB-ABL	 

                      

                    

                    
 

                  

                

                 

                 

                
 

                 

                
                  

                  Credit
Agreement

                  Signature
Page

                  
                  

                

              

               

               

              
                
                  
                  

                

                
                  
                  

                  
                    

                  

                

                
                  
                  

                

                 

                
                  
                    
                      
                        	
                                
                                  
                                    US BANK, NATIONAL
      ASSOCIATION,

                                    as
      a Lender

                                  

                                

                              	 

                      

                       

                      
                        
                          	By:	/s/ Blake
      Malia	 
	Name:
      	Blake
Malia	 
	Title:
      	Assistant Vice
      President	 

                        

                      

                      
 

                    

                  

                  

                   

                   

                   

                   

                   

                  
                    

                    Credit
Agreement

                    Signature
Page 

                  

                

                 

                
                  
                    
                    

                  

                  
                    
                    

                    
                      

                    

                  

                  
                    
                    

                     

                    
                      
                        
                          
                            	
                                    
                                      
                                        REGIONS BANK,

                                        as
      a Lender

                                      

                                    

                                  	 

                          

                           

                          
                            
                              	By:	/s/ Bruce
      Kasper	 
	Name:
      	Bruce
    Kasper	 
	Title:
      	Attorney in
      Fact	 

                            

                          

                          
 

                        

                      

                      

                       

                       

                       

                       

                       

                      
                        

                        Credit
Agreement

                        Signature
Page 

                      

                    

                     

                    
                      
                        
                        

                      

                      
                        
                        

                        
                          

                        

                      

                      
                        
                        

                      

                       

                    

                  

                

              

            

          

          
            
              
                	
                        
                          
                            ING CAPITAL LLC,

                            as
      a Lender

                          

                        

                      	 

              

               

              
                
                  	By:	/s/ William B.
      Redmond	 
	Name:
      	William B.
      Redmond	 
	Title:
      	Managing
      Director	 

                

              

              
 

            

          

           

           

           

          
 

        

         

        
          

          Credit
Agreement

          Signature
Page

           

            
              
                
                

              

              
                
                

                
                  

                

              

              
                
                

              

            

          

        

        
           

          
            
              
                	
                        
                          
                            RBS BUSINESS CAPITAL, a division of
      RBS

                            ASSET FINANCE, INC.,
      a subsidiary of RBS

                            CITIZENS, N.A.,

                          

                        

                      	 
	
                        as
      a Lender

                      	 

              

               

              
                
                  	By:	/s/ John D.
      Bobbin	 
	Name:
      	John
      D. Bobbin	 
	Title:
      	Vice
    President	 

                

              

              
 

            

          

           

           

           

          
 

           

          
            

            Credit
Agreement

            Signature
Page

             

              
                
                  
                  

                

                
                  
                  

                  
                    

                  

                

                
                  
                  

                   

                  
                    
                      
                        	
                                
                                  
                                    TD BANK, N.A.,

                                    as
      a Lender

                                  

                                

                              	 

                      

                       

                      
                        
                          	By:	/s/ Matthew
      Leighton	 
	Name:
      	Matthew
      Leighton	 
	Title:
      	Vice
    President	 

                        

                      

                      
 

                    

                  

                   

                   

                   

                  
 

                   

                  
                    

                    Credit
Agreement

                    Signature
Page

                     

                      
                        
                          
                          

                        

                        
                          
                          

                          
                            

                          

                        

                        
                          
                          

                        

                      

                    

                  

                

              

            

          

        

      

      
         

        
          
            
              	
                      
                        
                          CAPITAL ONE LEVERAGE FINANCE
      CORP.,

                          as
      a Lender

                        

                      

                    	 

            

             

            
              
                	By:	/s/ Nick
      Malatestinic	 
	Name:
      	Nick
      Malatestinic	 
	Title:
      	Senior Vice
      President	 

              

            

            
 

          

        

         

         

         

        
 

         

        
          

          Credit
Agreement

          Signature
Page

           

            
              
                
                

              

              
                
                

                
                  

                

              

              
                
                

                 

                
                  
                    
                      	
                              
                                
                                  FIFTH THIRD BANK,

                                  as
      a Lender

                                

                              

                            	 

                    

                     

                    
                      
                        	By:	/s/ George B.
      Davis	 
	Name:
      	George B.
      Davis	 
	Title:
      	Vice
    President	 

                      

                    

                    
 

                  

                

                 

                 

                 

                
 

                 

                
                  

                  Credit
Agreement

                  Signature
Page

                   

                    
                      
                        
                        

                      

                      
                        
                        

                        
                          

                        

                      

                      
                        
                        

                         

                        
                          
                            
                              	
                                      
                                        
                                          NATIONAL CITY BUSINESS CREDIT, INC.,

                                          as
      a Lender

                                        

                                      

                                    	 

                            

                             

                            
                              
                                	By:	/s/ Matthew
      Potter	 
	Name:
      	Matthew
    Potter	 
	Title:
      	Vice
    President	 

                              

                            

                            
 

                          

                        

                         

                         

                         

                        
 

                         

                        
                          

                          Credit
Agreement

                          Signature
Page

                           

                            
                              
                                
                                

                              

                              
                                
                                

                                
                                  

                                

                              

                              
                                
                                

                                 

                                
                                  
                                    
                                      	
                                              
                                                
                                                  UNION BANK N.A.,

                                                  as
      a Lender

                                                

                                              

                                            	 

                                    

                                     

                                    
                                      
                                        	By:	/s/ Brent
      Housteau	 
	Name:
      	Brent
    Housteau	 
	Title:
      	Vice
    President	 

                                      

                                    

                                    
 

                                  

                                

                                 

                                 

                                 

                                
 

                                 

                                
                                  

                                  Credit
Agreement

                                  Signature
Page

                                   

                                    
                                      
                                        
                                        

                                      

                                      
                                        
                                        

                                        
                                          

                                        

                                      

                                      
                                        
                                        

                                         

                                        
                                          
                                            
                                              	
                                                      
                                                        
                                                          COMERICA
      BANK,

                                                          as
      a Lender

                                                        

                                                      

                                                    	 

                                            

                                             

                                            
                                              
                                                	By:	/s/ Chris
      Rice	 
	Name:
      	Chris Rice	 
	Title:
      	Corporate Banking
      Officer	 

                                              

                                            

                                            
 

                                          

                                        

                                         

                                         

                                         

                                        
 

                                         

                                        
                                          

                                          Credit
Agreement

                                          Signature
Page

                                           

                                            
                                              
                                                
                                                

                                              

                                              
                                                
                                                

                                                
                                                  

                                                

                                              

                                              
                                                
                                                

                                                 

                                                
                                                  
                                                    
                                                      	
                                                              
                                                                
                                                                  FIRST HAWAIIAN BANK,

                                                                  as
      a Lender

                                                                

                                                              

                                                            	 

                                                    

                                                     

                                                    
                                                      
                                                        	By:	/s/ Dawn
      Hofmann	 
	Name:
      	Dawn
      Hofmann	 
	Title:
      	Vice
    President	 

                                                      

                                                    

                                                    
 

                                                  

                                                

                                                 

                                                 

                                                 

                                                
 

                                                 

                                                
                                                  

                                                  Credit
Agreement

                                                  Signature
Page

                                                   

                                                    
                                                      
                                                        
                                                        

                                                      

                                                      
                                                        
                                                        

                                                        
                                                          

                                                        

                                                      

                                                      
                                                        
                                                        

                                                         

                                                        
                                                          
                                                            
                                                              	
                                                                      
                                                                        
                                                                          MALAYAN BANKING BERHAD,

                                                                          as
      a Lender

                                                                        

                                                                      

                                                                    	 

                                                            

                                                             

                                                            
                                                              
                                                                	By:	/s/ Fauzi
      Zulkifli	 
	Name:
      	Fauzi
    Zulkifli	 
	Title:
      	General
      Manager	 

                                                              

                                                            

                                                            
 

                                                          

                                                        

                                                         

                                                         

                                                         

                                                        
 

                                                         

                                                        
                                                          

                                                          Credit
Agreement

                                                          Signature
Page

                                                           

                                                            
                                                              
                                                                
                                                                

                                                              

                                                              
                                                                
                                                                

                                                                
                                                                  

                                                                

                                                              

                                                              
                                                                
                                                                

                                                                 

                                                                
                                                                  
                                                                    
                                                                      	
                                                                              
                                                                                
                                                                                  MANUFACTURERS AND TRADERS TRUST
      COMPANY,

                                                                                  as
      a Lender

                                                                                

                                                                              

                                                                            	 

                                                                    

                                                                     

                                                                    
                                                                      
                                                                        	By:	/s/ Grant C.
      Gooder	 
	Name:
      	Grant C.
      Gooder	 
	Title:
      	Assistant Vice
      President	 

                                                                      

                                                                    

                                                                    
 

                                                                  

                                                                

                                                                 

                                                                 

                                                                 

                                                                
 

                                                                 

                                                                
                                                                  

                                                                  Credit
Agreement

                                                                  Signature
Page

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00163-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00163-of-00352.parquet"}]]