8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

Current Report

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): October 3, 2011

HORIZON LINES, INC.

(Exact name of registrant as specified in its charter)

Delaware	001-32627	74-3123672
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

4064 Colony Road, Suite 200

Charlotte, North Carolina 28211

(Address of Principal Executive Offices, including Zip Code)

(704) 973-7000

(Registrant’s telephone number, including area code)

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Explanatory Note

On October 5, 2011, Horizon Lines, Inc. (the “Company”) completed its previously disclosed offer to exchange $327,766,000 in aggregate principal amount of its 4.25% Convertible Senior Notes due 2012 (the “Old Notes”), representing 99.3% of the aggregate principal amount of the Old Notes outstanding, for (i) 25,087,141 shares of its common stock (the “Common Stock”), (ii) 24,574,375 warrants to purchase shares of its common stock (the “Warrants”) and (iii) $178,781,456 in aggregate principal amount of new 6.00% Series A Convertible Senior Secured Notes due 2017 (the “Series A Notes”) and $99,323,032 in aggregate principal amount of new 6.00% Series B Mandatorily Convertible Senior Secured Notes (the “Series B Notes” and, together with the Series A Notes, the “New Notes”). The exchange offer expired at 5:00 p.m., New York City time, on October 3, 2011.

Concurrently with the exchange offer, the Company obtained consents from the participating holders and entered into a supplemental indenture to the indenture governing the Old Notes in connection with certain amendments to eliminate or amend substantially all of the restrictive covenants, and modify certain of the events of default and various other provisions.

The exchange offer and consent solicitation are described in the prospectus, dated October 3, 2011 (the “Prospectus”), filed pursuant to Rule 424(b)(3) of the Securities Act of 1933, as amended (the “Securities Act”), on October 3, 2011.

Concurrently with the consummation of the exchange offer, Horizon Lines, LLC, a wholly-owned subsidiary of the Company, issued (i) $225.0 million aggregate principal amount of new 11.00% First-Lien Senior Secured Notes due 2016 (the “First Lien Secured Notes”) and (ii) $100.0 million of new 13.00%-15.00% Second-Lien Senior Secured Notes due 2016 (the “Second Lien Secured Notes”). Horizon Lines, LLC as borrower also entered into a new $100.0 million asset-based revolving credit facility (the “New ABL Facility”) at the consummation of the exchange offer.

Item 1.01. Entry into a Material Definitive Agreement.

The New Series A and Series B Notes

Indenture

As part of the exchange offer, on October 5, 2011, the Company issued $178,781,456 aggregate principal amount of its Series A Notes and $99,323,032 aggregate principal amount of its Series B Notes. The Series A Notes and the Series B Notes are each fully and unconditionally guaranteed by all of the Company’s domestic subsidiaries (collectively, the “Notes Guarantors”).

The New Notes were issued pursuant to an Indenture, which the Company and the Guarantors entered into with U.S. Bank National Association, as trustee and collateral agent, on October 5, 2011 (the “New Notes Indenture”).

The New Notes will bear interest at a rate of 6.00% per annum, payable semi-annually. The Series A Notes will mature on April 15, 2017 and are convertible, at the option of the holders, and at the Company’s option under certain circumstances beginning on the one-year anniversary of the issuance of the Series A Notes, into shares of the Company’s Common Stock or Warrants, as the case may be. The Series B Notes are mandatorily convertible into shares of the Company’s Common Stock or Warrants, as the case may be, in two equal installments of $49.7 million each on the three-month and nine-month anniversaries of the consummation of the exchange offer, subject to certain conditions.

Registration Rights Agreement

On October 5, 2011, the Company and each of the New Notes Guarantors entered into a registration rights agreement relating to the New Notes (the “New Notes Registration Rights Agreement”). Pursuant to the New Notes Registration Rights Agreement, the Company agreed to use its commercially reasonable efforts to file with the SEC a shelf registration statement (the “Shelf Registration Statement”) on Form S-1 or Form S-3, as applicable, covering the resale by eligible holders of the Series A Notes,

Common Stock and Warrants issuable upon conversion of the Series A Notes and the Series B Notes, and any other Common Stock and Warrants held by them, on a delayed or continuous basis, within 60 days following the date the Series A Notes and the Series B Notes were issued, and to cause such Shelf Registration Statement to be declared effective under the Securities Act by no later than the 180th day following such date. Under the terms of the New Notes Indenture and the Series B Notes, the Company will not be permitted to effect the second mandatory conversion of the Series B Notes unless the Shelf Registration Statement is effective under the Securities Act as of the time of such conversion.

The foregoing description of the New Notes Registration Rights Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the New Notes Registration Rights Agreement which is filed as an exhibit hereto and is incorporated by reference herein.

The Warrants

As part of the exchange offer, on October 5, 2011, the Company issued 24,574,375 Warrants.

The Warrants were issued pursuant to a Warrant Agreement, which the Company entered into with The Bank of New York Mellon Trust Company, N.A, as warrant agent, on October 5, 2011 (the “Warrant Agreement”).

Pursuant to the Warrant Agreement, each Warrant entitles the holder to purchase one share of Common Stock at a price of $0.01 per share, subject to adjustment in certain circumstances. In lieu of payment of the exercise price, a Warrant holder will have the right (but not the obligation) to require the Company to convert its Warrants, in whole or in part, into shares of its Common Stock, and the Company will withhold, from the shares of Common Stock that would otherwise be delivered to such Warrant holder, shares issuable upon exercise of the Warrants equal in value to the aggregate exercise price.

Notwithstanding the foregoing, Warrant holders will not be permitted to exercise or convert their Warrants if and to the extent that the shares of Common Stock issuable upon exercise or conversion would constitute “excess shares” (as defined in the Company’s certificate of incorporation) if they were issued. In addition, a Warrant holder who cannot establish to the Company’s reasonable satisfaction that it (or, if not the holder, the person that the holder has designated to receive the Common Stock upon exercise or conversion) is a United States citizen, will not be permitted to exercise or convert its Warrants to the extent the receipt of the Common Stock upon exercise or conversion would cause such person or any person whose ownership position would be aggregated with that of such person to exceed 4.9% of the Company’s outstanding Common Stock.

The foregoing descriptions of the Warrants (a form of which is attached as an exhibit to the Warrant Agreement) and the Warrant Agreement do not purport to be complete and are qualified in their entirety by reference to the full text of the Warrants and the Warrant Agreement, each of which is filed as an exhibit hereto and is incorporated by reference herein.

Supplemental Indenture

On October 5, 2011, the Company and The Bank of New York Mellon Trust Company, N.A., the trustee for the Old Notes, entered into a supplemental indenture to the indenture governing the Old Notes (the “Old Indenture”) to provide for, among other things, the following: (i) releasing the Company from the restrictions or its obligations, as the case may be, under the Sections 7.01 (“Company May Consolidate, Etc., Only on Certain Terms”), 10.02 (“Maintenance of Offices or Agencies”), 10.03 (“Existence”), 10.05 (“Money for Note Payments to Be Held in Trust”), 10.07 (“Delivery of Certain Information”) and 10.08 (“Registration Rights”) under the Old Indenture; (ii) amending the Old Indenture to delete in their entirety, including all references therein, the events of default described in Section 5.01(d), (e), (f), (g), (h), (i) and (j) such that the these events of default shall no longer constitute Events of Default and (iii) deleting all definitions set forth in Section 1.01 of the Old Indenture that relate to defined terms used solely in the covenants or sections deleted by the Supplemental Indenture.

The foregoing description of the Supplemental Indenture does not purport to be complete and is qualified in its entirety by reference to the full text of the Supplemental Indenture, which is filed as an exhibit hereto and is incorporated by reference herein.

First Lien Secured Notes

On October 5, 2011, Horizon Lines, LLC (“OpCo”), a wholly-owned subsidiary of the Company, completed the sale of $225.0 million aggregate principal amount of its First Lien Secured Notes. The First Lien Secured Notes are fully and unconditionally guaranteed by the Company and the other Notes Guarantors.

The First Lien Secured Notes were sold pursuant to a purchase agreement (the “First Lien Purchase Agreement”) dated October 5, 2011 among OpCo, the Company (as guarantor), the other Notes Guarantors and the Purchasers named therein. The First Lien Purchase Agreement contains customary representations, warranties and agreements of OpCo, the Company, the other Notes Guarantors and the Purchasers, conditions to the closing, indemnification rights and obligations of the parties and termination provisions. The First Lien Secured Notes were issued pursuant to an Indenture, which OpCo, the Company and the other Notes Guarantors entered into with U.S. Bank National Association, as trustee and collateral agent, on October 5, 2011 (the “First Lien Indenture”).

The First Lien Secured Notes bear interest at a rate of 11.0% per annum, payable semiannually, beginning on April 15, 2012 and mature on October 15, 2016. Other material terms include:

• Call Protection. The First Lien Secured Notes are callable at 101.5% of their aggregate principal amount, plus accrued and unpaid interest thereon in the first year after their issuance and at par plus accrued and unpaid interest thereafter.

• Mandatory Prepayment. Under the First Lien Secured Notes, the Company will be obligated to make mandatory prepayments on an annual basis of 1%.

• Collateral. Subject to agreed upon permitted liens and except for certain excluded assets and other exceptions (including agreed upon post issuance periods to create and perfect certain liens on collateral), the First Lien Secured Notes are secured by a first priority lien on all Secured Notes Priority Collateral and a second priority lien on all ABL Priority Collateral (each as defined below).

• Covenants. The First Lien Secured Notes contain affirmative and negative covenants which are typical for senior secured high-yield notes with no maintenance based covenants. The First Lien Secured Notes contain other covenants, including: change of control put at 101% (subject to a permitted holder exception); limitation on asset sales; limitation on incurrence of indebtedness and preferred stock; limitation on restricted payments; limitation on restricted investments; limitation on liens; limitation on dividend blockers; limitation on affiliate transactions; limitation on sale/leaseback transactions materially consistent with such limitations currently in place under the Company’s existing loan documentation; limitation on guarantees by restricted subsidiaries; and limitation on mergers, consolidations and sales of all/substantially all of the assets of the Company.

These covenants are subject to important exceptions and qualifications.

• Fee. The Company is obligated to pay a 2.0% cash commitment fee payable on the full $225 million of First Lien Secured Notes. 50% of the commitment fee was due upfront upon entry into the associated commitment letter, and the remaining 50% will be due upon closing of the refinancing.

OpCo, the Company and the other Notes Guarantors also entered into a registration rights agreement with the Purchasers named in the First Lien Purchase Agreement (the “First Lien Registration Rights Agreement”). The Company will be obligated to complete an A/B Exchange Offer as soon as practicable but in no event later than 180 days after the issuance of the First Lien Secured Notes. If the Company does not complete the A/B Exchange Offer within the 180 day period, this will result in a “registration default” and 0.25% of additional interest per 90 days of “registration default” will be added to the interest payable on the First Lien Secured Notes, up to a maximum of 1.00% of additional interest.

The First Lien Secured Notes were offered and sold to certain purchasers participating in the exchange offer pursuant to an exemption from, or a transaction not subject to, the registration requirements of the Securities Act.

The foregoing descriptions of the First Lien Purchase Agreement and the First Lien Registration Rights Agreement do not purport to be complete and are qualified in their entirety by reference to the full text of the First Lien Purchase Agreement and the First Lien Registration Rights Agreement, each of which is filed as an exhibit hereto and is incorporated by reference herein.

Second Lien Secured Notes

On October 5, 2011, OpCo completed the sale of $100.0 million aggregate principal amount of its Second Lien Secured Notes. The Second Lien Secured Notes are fully and unconditionally guaranteed by the Notes Guarantors. The proceeds from the First Lien Secured Notes and the Second Lien Secured Notes were used, among other things, to satisfy in full the Company’s obligations outstanding under its previous first-lien revolving credit facility and term loan, which totaled $265.0 million on October 5, 2011.

The Second Lien Secured Notes were sold pursuant to a purchase agreement (the “Second Lien Purchase Agreement”) dated October 5, 2011 among OpCo, the Company (as guarantor), the other Notes Guarantors and the Purchasers named therein. The Second Lien Purchase Agreement contains customary representations, warranties and agreements of OpCo, the Company, the other Notes Guarantors and the Purchasers, conditions to the closing, indemnification rights and obligations of the parties and termination provisions. The Second Lien Secured Notes were issued pursuant to an Indenture, which OpCo, the Company (as guarantor) and the other Notes Guarantors entered into with U.S. Bank National Association, as trustee and collateral agent, on October 5, 2011 (the “Second Lien Indenture”).

The Second Lien Secured Notes bear interest at a rate of either: (i) 13% per annum, payable semi-annually in cash in arrears; (ii) 14% per annum, 50% of which payable semi-annually in cash in arrears and 50% payable in kind; or (iii) 15% per annum payable in kind, payable semiannually, beginning on April 15, 2012, and mature on October 15, 2016. Other material terms of the Second Lien Secured Notes include:

• Call Protection. The Second Lien Secured Notes are non-callable for 2 years from the date of their issuance, and thereafter the Second Lien Secured Notes will be callable at (i) 106% of their aggregate principal amount, plus accrued and unpaid interest thereon in the third year, (ii) 103% of their aggregate principal amount, plus accrued and unpaid interest thereon in the fourth year, and (iii) at par plus accrued and unpaid interest thereafter.

• Collateral. Subject to agreed upon permitted liens and except for certain excluded assets and other exceptions (including agreed upon post issuance periods to create and perfect certain liens on collateral), the Second Lien Secured Notes are secured by a second priority lien on all Secured Notes Priority Collateral and a third priority lien on all ABL Priority Collateral (each as defined below).

• Covenants. The Second Lien Secured Notes contain affirmative and negative covenants which are typical for senior secured high-yield notes with no maintenance based covenants. The Second Lien Secured Notes contain other covenants, including: change of control put at 101% (subject to a permitted holder exception); limitation on asset sales; limitation on incurrence of indebtedness and

preferred stock; limitation on restricted payments; limitation on restricted investments; limitation on liens; limitation on dividend blockers; limitation on affiliate transactions; limitation on sale/leaseback transactions materially consistent with such limitations currently in place under the Company’s existing loan documentation; limitation on guarantees by restricted subsidiaries; and limitation on mergers, consolidations and sales of all/substantially all of the assets of the Company.

These covenants are subject to important exceptions and qualifications.

• Fee. The Company will be obligated to pay a 2.0% cash commitment fee payable on the full $100 million of Second Lien Secured Notes. 50% of the commitment fee was paid upfront upon entry into the associated commitment letter, and the remaining 50% will be due upon closing of the refinancing.

OpCo, the Company and the other Guarantors also entered into a registration rights agreement with the Purchasers named in the Second Lien Purchase Agreement (the “Second Lien Registration Rights Agreement”). The Company will be obligated to complete an A/B Exchange Offer as soon as practicable but in no event later than 180 days after the issuance of the Second Lien Secured Notes and Second Lien Secured Notes (described below). If the Company does not complete the A/B Exchange Offer within the 180 day period, this will result in a “registration default” and 0.25% of additional interest per 90 days of “registration default” will be added to the interest payable on the Second Lien Secured Notes, up to a maximum of 1.00% of additional interest.

The Second Lien Secured Notes were offered and sold to certain purchasers participating in the exchange offer pursuant to an exemption from, or a transaction not subject to, the registration requirements of the Securities Act.

The foregoing descriptions of the Second Lien Purchase Agreement and the Second Lien Registration Rights Agreement do not purport to be complete and are qualified in their entirety by reference to the full text of the Second Lien Purchase Agreement and the Second Lien Registration Rights Agreement, each of which is filed as an exhibit hereto and is incorporated by reference herein.

New ABL Facility

In connection with the recapitalization plan, on October 5, 2011, the Company entered into a $100.0 million asset-based revolving credit facility (the “New ABL Facility”) with Wells Fargo Capital Finance, LLC (“Wells Fargo”).

Use of the New ABL Facility is subject to compliance with a customary borrowing base limitation. The New ABL Facility includes an up to $30.0 million letter of credit sub-facility and a swingline sub-facility up to $15.0 million, with Wells Fargo serving as administrative agent and collateral agent. Horizon Lines, LLC is the borrower under the New ABL Facility (the “Borrower”). The Company, each of the initial New Notes Guarantors and each of the Company’s present and future material domestic subsidiaries guarantee the obligations of the Borrower, subject to certain exceptions (each such subsidiary a “New ABL Facility Guarantor” and collectively, the “New ABL Facility Guarantors”, and together with the Borrower, the “ABL Loan Parties”). The Borrower has the option to request increases in the maximum commitment under the New ABL Facility by up to $25 million in the aggregate; however, such incremental facility increases have not been committed to in advance. The New ABL Facility was used on the closing date for the rollover of certain issued and outstanding letters of credit and thereafter will be used by the Borrower and the other ABL Loan Parties for working capital and other general corporate purposes.

The New ABL Facility matures October 5, 2016 (but 90 days earlier if the First Lien Secured Notes and the Second Lien Secured Notes are not repaid or refinanced as of such date).

The interest rate on the New ABL Facility is LIBOR or a base rate plus an applicable margin based on leverage and excess availability ranging from (i) 1.25% to 2.75%, in the case of base rate loans and (ii) 2.25% to 3.75%, in the case of LIBOR loans. A fee ranging from .375% to .50% per annum will accrue on unutilized commitments under the New ABL Facility.

Subject to permitted liens and except for certain excluded assets and other exceptions (including agreed upon post closing periods to create and perfect certain liens on collateral), the New ABL Facility is secured by (i) a first priority lien on the ABL Loan Parties’ interest in accounts receivable, deposit accounts, securities accounts, investment property (other than equity interests of the subsidiaries and joint ventures of the Company) and cash, in each case with certain exceptions for such assets that are proceeds of Secured Notes Priority Collateral (as defined below); tax refunds and similar tax payments; certain intercompany loans; chattel paper, documents, instruments, letter-of-credit rights, guarantees, supporting obligations, credit enhancements, contract rights, and causes of action, in each case for, evidencing, relating to or substituted for (as applicable) the foregoing; commercial tort claims; general intangibles related to the foregoing; and proceeds, products, and books and records related to the foregoing (collectively, the “ABL Priority Collateral”); and (ii) a fourth priority lien on all or substantially all other assets of the ABL Loan Parties securing the First Lien Secured Notes, the Second Lien Secured Notes and the New Notes (the “Secured Notes Priority Collateral”).

The New ABL Facility requires compliance with a minimum fixed charge coverage ratio test if excess availability is less than the greater of (i) $12.5 million and (ii) 12.5% of the maximum commitment under the New ABL Facility. In addition, the New ABL Facility includes certain customary negative covenants that, subject to certain materiality thresholds, baskets and other agreed upon exceptions and qualifications, will limit, among other things, indebtedness, liens, asset sales and other dispositions, mergers, liquidations, dissolutions and other fundamental changes, investments and acquisitions, dividends, distributions on equity or redemptions and repurchases of capital stock, transactions with affiliates, repayments of certain debt, conduct of business and change of control. The New ABL Facility also contain certain customary representations and warranties, affirmative covenants and events of default, as well as provisions requiring compliance with applicable citizenship requirements of the Jones Act.

The foregoing description of the New ABL Facility does not purport to be complete and is qualified in its entirety by reference to the full text of the New ABL Facility, which is filed as an exhibit hereto and is incorporated by reference herein.

Security Documents

On October 5, 2011, Opco, the Company, the other New Notes Guarantors and U.S. Bank National Association, as collateral agent, entered into security agreements, vessel mortgages and other collateral documents relating to each of the ABL Facility, the New Notes, the First Lien Secured Notes and the Second Lien Secured Notes (collectively, the “Security Agreements”). Under each of the Security Agreements, Opco, the Company and the other New Notes Guarantors under each of the ABL Facility, the New Notes, the First Lien Secured Notes and the Second Lien Secured Notes agreed to grant continuing security interests in and to substantially all of their assets in order to secure the prompt and complete payment, observance and performance of, among other things, the ABL Facility, the New Notes, the First Lien Secured Notes and the Second Lien Secured Notes.

Intercreditor Agreement

On October 5, 2011, the Company, the Opco and the New Notes Guarantors entered into an intercreditor agreement (the “Intercreditor Agreement”) with U.S. Bank National Association, as the First-Lien Notes Agent, the Second-Lien Notes Agent and the Third-Lien Notes Agent, and Wells Fargo Capital Finance, LLC, as the initial ABL Agent (the “Collateral Agent”), that set forth the relative priority of the liens under the New ABL Facility, the First Lien Secured Notes, the Second Lien Secured Notes and the New Notes, as well as certain other rights, priorities and interests of the holders of the New Notes and the holders of other permitted and additional obligations, the First Lien Secured Notes, the Second Lien Secured Notes and the holders of obligations under the New ABL Facility and certain bank products.

The foregoing description of the Intercreditor Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Intercreditor Agreement, which is filed as an exhibit hereto and is incorporated by reference herein.

Amendment to the Restructuring Support Agreement

On October 3, 2011, the Company and certain of its subsidiaries entered into an amendment to the Restructuring Support Agreement (the “Amendment”) with the requisite consent of certain holders (the “Exchanging Holders”) of its Old Notes. The Amendment modifies the previously announced Restructuring Support Agreement, dated August 26, 2011, as amended by the First Amendment to the Restructuring Support Agreement dated September 29, 2011, between the Exchanging Holders and the Company.

The Amendment clarifies certain understandings regarding post-closing corporate governance-related items contained in the First Amendment to the Restructuring Agreement, including that the Exchanging Holders will designate seven director nominees to the Company’s board of directors, and the Company will use reasonable best efforts to cause the board of directors to expand to comprise eleven directors

The foregoing description of the Amendment does not purport to be complete and is qualified in its entirety by reference to the full text of the Amendment, which is filed as an exhibit hereto and is incorporated by reference herein.

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

The information in Item 1.01 under the captions “The New Series A and Series B Notes,” “First Lien Secured Notes,” “Second Lien Secured Notes” and “New ABL Facility” are incorporated herein by reference.

Item 3.03 Material Modification to Rights of Security Holders.

On October 5, 2011, the Company and the trustee under the Old Indenture relating to the Old Notes entered into a Supplemental Indenture which materially modified the rights of noteholders who did not tender their Old Notes in the exchange offer. The information in Item 1.01 under the caption “Supplemental Indenture” is responsive to this item and is incorporated herein by reference.

5.01 Changes in Control of Registrant.

The information set forth in the “Explanatory Note” and the section entitled “Amendment to the Restructuring Support Agreement” in Item 1.01 hereof are incorporated herein by reference in connection with arrangements the operation of which may at a subsequent date result in a change of control of the Company.

Item 8.01 Other Events.

On October 5, 2011, the Company announced that it has completed a comprehensive refinancing of its entire capital structure. The new capital structure addresses the Company’s financial needs by providing adequate liquidity to fund continuing operations and the ability to achieve substantial additional debt reduction.

A copy of the press release relating to the completion of the comprehensive refinancing is filed as an exhibit hereto and is incorporated by reference herein.

Item 9.01. Financial Statements and Exhibits

(d) Exhibits.

Exhibit No.	Description of Exhibit
4.4	Supplemental Indenture, dated October 5, 2011, among the Company and The Bank of New York Mellon (formerly known as The Bank of New York Trust Company, N.A.), as trustee, relating to the Company’s 4.25% Convertible Senior Notes due 2012
4.5	Warrant Agreement, dated October 5, 2011, among the Company and The Bank of New York Trust Company, N.A., as warrant agent, relating to the Company’s Warrants to purchase shares of its Common Stock.
10.1	Form of Purchase Agreement, dated October 5, 2011, among Horizon Lines, LLC, the Guarantors named therein and the Purchasers named therein, relating to the 11.00% First-Lien Senior Secured Notes due 2016.
10.2	Form of Purchase Agreement, dated October 5, 2011, among Horizon Lines, LLC, the Guarantors named therein and the Purchasers named therein, relating to the Second-Lien Senior Secured Notes due 2016.
10.3	Registration Rights Agreement, dated October 5, 2011, among the Company, the Guarantors named therein and the Purchasers named therein, relating to the 6.00% Series A Convertible Senior Secured Notes due 2017 and 6.00% Series B Mandatorily Convertible Senior Secured Notes.
10.4	Registration Rights Agreement, dated October 5, 2011, among the Company, the Guarantors named therein and the Purchasers named therein, relating to the 11.00% First-Lien Senior Secured Notes due 2016.
10.5	Registration Rights Agreement, dated October 5, 2011, among the Company, the Guarantors named therein and the Purchasers named therein, relating to the Second-Lien Senior Secured Notes due 2016.
10.6	$100.0 million asset-backed revolving credit facility, dated October 5, 2011, among the Company and Wells Fargo Capital Finance, LLC.
10.7	Intercreditor Agreement, dated as of October 5, 2011, among the Company, each of the other Grantors (as defined therein), Wells Fargo Capital Finance, LLC and U.S. Bank National Association.
10.8	Form of Second Amendment to the Restructuring Support Agreement, dated October 3, 2011.
99.1	Press Release of Horizon Lines, Inc. dated October 5, 2011.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	HORIZON LINES, INC.
Date: October 6, 2011	By:	/s/ Michael T. Avara
		Name:	Michael T. Avara
		Title:	Executive Vice President and Chief Financial Officer

EXHIBIT INDEX

Exhibit No.	Description of Exhibit
4.4	Supplemental Indenture, dated October 5, 2011, among the Company and The Bank of New York Mellon (formerly known as The Bank of New York Trust Company, N.A.), as trustee, relating to the Company’s 4.25% Convertible Senior Notes due 2012
4.5	Warrant Agreement, dated October 5, 2011, among the Company and The Bank of New York Trust Company, N.A., as warrant agent, relating to the Company’s Warrants to purchase shares of its Common Stock.
10.1	Form of Purchase Agreement, dated October 5, 2011, among Horizon Lines, LLC, the Guarantors named therein and the Purchasers named therein, relating to the 11.00% First-Lien Senior Secured Notes due 2016.
10.2	Form of Purchase Agreement, dated October 5, 2011, among Horizon Lines, LLC, the Guarantors named therein and the Purchasers named therein, relating to the Second-Lien Senior Secured Notes due 2016.
10.3	Registration Rights Agreement, dated October 5, 2011, among the Company, the Guarantors named therein and the Purchasers named therein, relating to the 6.00% Series A Convertible Senior Secured Notes due 2017 and 6.00% Series B Mandatorily Convertible Senior Secured Notes.
10.4	Registration Rights Agreement, dated October 5, 2011, among the Company, the Guarantors named therein and the Purchasers named therein, relating to the 11.00% First-Lien Senior Secured Notes due 2016.
10.5	Registration Rights Agreement, dated October 5, 2011, among the Company, the Guarantors named therein and the Purchasers named therein, relating to the Second-Lien Senior Secured Notes due 2016.
10.6	$100.0 million asset-backed revolving credit facility, dated October 5, 2011, among the Company and Wells Fargo Capital Finance, LLC.
10.7	Intercreditor Agreement, dated as of October 5, 2011, among the Company, each of the other Grantors (as defined therein), Wells Fargo Capital Finance, LLC and U.S. Bank National Association.
10.8	Form of Second Amendment to the Restructuring Support Agreement, dated October 3, 2011.
99.1	Press Release of Horizon Lines, Inc. dated October 5, 2011.

11

EX-4.4

Exhibit 4.4

SUPPLEMENTAL INDENTURE

THIS SUPPLEMENTAL INDENTURE (this “Supplemental Indenture”) is dated as of October 5, 2011, and has been entered into by and between Horizon Lines, Inc., a Delaware corporation, having its principal office at 4046 Colony Road, Suite 200, Charlotte, North Carolina 2821, (the “Company”), and The Bank of New York Mellon Trust Company, N.A., as trustee (the “Trustee”).

RECITALS

WHEREAS, the Company and the Trustee previously entered into that certain indenture dated as of August 8, 2007 (the “Indenture”), providing for the issuance of the Company’s 4.25% Senior Convertible Notes due 2012 (the “Notes”);

WHEREAS, Notes in the aggregate principal amount of $330,000,000 are currently outstanding under the Indenture;

WHEREAS, Section 8.02 of the Indenture provides that the Company, when authorized by a Board Resolution, and the Trustee, upon receipt of a Company Request and an Opinion of Counsel, may enter into an indenture or indentures supplemental to the Indenture for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of the Indenture or of modifying in any manner the rights of the Holders of Notes under the Indenture, with written consent of the Holders of not less than a majority in principal amount of the outstanding Notes (including without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for Notes), by the act of said Holders delivered to the Company and the Trustee;

WHEREAS, the Company has offered to exchange shares of its common stock or warrants or redemption notes, as the case may be, and its 6.00% Series A Convertible Senior Secured Notes due 2017 and 6.00% Series B Mandatorily Convertible Senior Secured Notes for any and all outstanding Notes upon the terms and subject to the conditions set forth in the Registration Statement on Form S-4 originally filed with the Securities and Exchange Commission on August 26, 2011, as the same may be amended, supplemented or modified (the “Prospectus”) and the Schedule TO originally filed with the Securities and Exchange Commission on August 26, 2011, as may be amended supplemented or modified;

WHEREAS, the Company has been authorized by Board Resolution to enter into this Supplemental Indenture;

WHEREAS, the Company desires to amend certain provisions of the Indenture, as set forth in Article I of this Supplemental Indenture (the “Proposed Amendments”);

WHEREAS, all acts and requirements necessary to make this Supplemental Indenture the legal, valid and binding obligation of the Company have been done; and

WHEREAS, the Company has received and delivered to the Trustee the requisite consents to effect the Proposed Amendments under the Indenture.

AGREEMENT

NOW, THEREFORE, in consideration of the premises and the covenants and agreements contained herein, and for other good and valuable consideration the receipt of which is hereby acknowledged, and for the equal and proportionate benefit of the Holders of the Notes, the Company and the Trustee hereby agree as follows:

ARTICLE I

AMENDMENTS TO INDENTURE

Section 1.01 Amendments to Articles 5, 7 and 10. Upon written notification to the Trustee by the Company that it has accepted for exchange any and all of the Notes validly tendered on or prior to 5:00 p.m., New York City time, on October 3, 2011 pursuant to the Prospectus and any amendments, modifications or supplements thereto, then automatically (without further act by any person), with respect to the Notes:

(a) The Company shall be released from the restrictions or its obligations, as the case may be, under the following sections of the Indenture:

• Section 7.01 - “Company May Consolidate, Etc., Only on Certain Terms”.

• Section 10.02 - “Maintenance of Offices or Agencies”;

• Section 10.03 - “Existence”;

• Section 10.05 - “Money for Note Payments to Be Held in Trust”;

• Section 10.07 - “Delivery of Certain Information”; and

• Section 10.08 - “Registration Rights”.

(b) Failure to comply with the terms of any of the foregoing Sections of the Indenture shall no longer constitute a Default or an Event of Default under the Indenture and shall no longer have any other consequence under the Indenture.

(c) The occurrence of the events of default described in Section 5.01 (d), (e), (f), (g), (h), (i) and (j) shall no longer constitute Events of Default, shall be deleted in their entirety, including all references therein.

(d) All definitions set forth in Section 1.01 of the Indenture that relate to defined terms used solely in covenants or sections deleted hereby are deleted in their entirety.

ARTICLE II

MISCELLANEOUS

Section 2.01 Instruments To Be Read Together. This Supplemental Indenture is executed as and shall constitute an indenture supplemental to and in implementation of the Indenture, and said Indenture and this Supplemental Indenture shall henceforth be read together. This Supplemental Indenture shall form a part of the Indenture for all purposes, and every Holder of Notes shall be bound hereby and thereby.

Section 2.02 Confirmation. The Indenture as amended and supplemented by this Supplemental Indenture is in all respects confirmed and preserved.

Section 2.03 Terms Defined. Capitalized terms used in this Supplemental Indenture and not otherwise defined herein shall have the meanings assigned to such terms in the Indenture.

Section 2.04 Trust Indenture Act Controls. If any provision of this Supplemental Indenture limits, qualifies or conflicts with another provision that is required to be included in this Supplemental Indenture or the Indenture by the Trust Indenture Act of 1939, as amended, as in force at the date that this Supplemental Indenture is executed, the provisions required by the Trust Indenture Act of 1939 shall control.

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Section 2.05 Headings. The headings of the Articles and Sections of this Supplemental Indenture have been inserted for convenience of reference only, and are not to be considered a part hereof and shall in no way modify or restrict any of the terms and provisions hereof.

Section 2.06 Governing Law. The internal law of the State of New York shall govern this Supplemental Indenture without giving effect to applicable principles of conflicts of law to the extent that the application of the laws of another jurisdiction would be required thereby.

Section 2.07 Counterparts. This Supplemental Indenture may be executed in any number of counterparts, each of which so executed shall be deemed to be an original, but all such counterparts shall together constitute but one and the same instrument.

Section 2.08 Effectiveness; Termination. The provisions of this Supplemental Indenture will become effective immediately upon its execution by the Trustee in accordance with the provisions of Sections 8.02 and 8.04 of the Indenture; provided, that the amendments to the Indenture set forth in Section 1.01 of this Supplemental Indenture shall become operative as specified in Section 1.01 hereof.

Section 2.09 Acceptance by Trustee. The Trustee accepts the amendments to the Indenture effected by this Supplemental Indenture and agrees to execute the trusts created by the Indenture as hereby amended, but only upon the terms and conditions set forth in the Indenture.

Section 2.10 Responsibility of Trustee. The recitals contained herein shall be taken as the statements of the Company, and the Trustee assumes no responsibility for their correctness. The Trustee makes no representations as to the validity or sufficiency of this Supplemental Indenture.

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

HORIZON LINES, INC.

By:

Name:

Title:

THE BANK OF NEW YORK TRUST COMPANY, N.A.,

as Trustee

By:

Name:

Title:

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EX-4.5

Exhibit 4.5

EXECUTION VERSION

WARRANT AGREEMENT

Dated as of

October 5, 2011

between

HORIZON LINES, INC.,

and

THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.

as Warrant Agent

Warrants for

Common Stock

Table of Contents

		Page
ARTICLE I
DEFINITIONS
Section 1.01.	Definitions.		1
Section 1.02.	Rules of Construction.		3
ARTICLE II
WARRANTS
Section 2.01.	Form.		3
Section 2.02.	Execution and Countersignature.		4
Section 2.03.	Registry.		5
Section 2.04.	Transfer and Exchange.		6
Section 2.05.	Definitive Warrants.		7
Section 2.06.	Replacement Certificates.		9
Section 2.07.	Outstanding Warrants.		9
Section 2.08.	Cancellation.		9
Section 2.09.	CUSIP Numbers.		9
ARTICLE III
EXERCISE TERMS
Section 3.01.	Exercise.		10
Section 3.02.	Manner of Exercise and Issuance of Shares.		10
Section 3.03.	Jones Act Restrictions.		10
Section 3.04.	Covenant to Make Stock Certificates Available.		11
ARTICLE IV
ANTIDILUTION PROVISIONS
Section 4.01.	Antidilution Adjustments; Notice of Adjustment.		11
Section 4.02.	Adjustment to Warrant Certificate.		12
ARTICLE V
WARRANT AGENT
Section 5.01.	Appointment of Warrant Agent.		12
Section 5.02.	Rights and Duties of Warrant Agent.		12
Section 5.03.	Individual Rights of Warrant Agent.		14
Section 5.04.	Warrant Agent’s Disclaimer.		14
Section 5.05.	Compensation and Indemnity.		14

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Section 5.06.	Successor Warrant Agent.	14
Section 5.07.	Representations of the Company.	16
ARTICLE VI
MISCELLANEOUS
Section 6.01.	Persons Benefitting.	17
Section 6.02.	Amendment.	17
Section 6.03.	Notices.	18
Section 6.04.	Governing Law.	18
Section 6.05.	Successors.	18
Section 6.06.	Multiple Originals.	19
Section 6.07.	Inspection of Agreement.	19
Section 6.08.	Table of Contents.	19
Section 6.09.	Severability.	19
Section 6.10.	Waiver of Jury Trial.	19
Section 6.11.	Force Majeure.	19
EXHIBIT A	Form of Warrant

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WARRANT AGREEMENT dated as of October 5, 2011 (this “Agreement”), between Horizon Lines, Inc., a Delaware corporation (the “Company”), and The Bank of New York Mellon Trust Company, N.A., as warrant agent (the “Warrant Agent”).

The Company will issue the warrants described herein (each, a “Warrant” and collectively, the “Warrants”) to any Person entitled to receive shares of Common Stock (i) pursuant to the Exchange Offer (the “Exchange Offer”) described in the Company’s Registration Statement on Form S-4 (File No. 333-176520 and Nos. 333-176520-01 through -012) (the “Registration Statement”) or (ii) upon conversion of the Company’s 6.00% Series A Convertible Senior Secured Notes due 2017 (the “Series A Notes”) and its 6.00% Series B Convertible Senior Secured Notes (the “Series B Notes” and, together with the Series A Notes, the “Notes”), in each case, who cannot establish to the Company’s reasonable satisfaction that it is a U.S. Citizen (as defined below) for purposes of the Company’s compliance with the Jones Act if and to the extent such shares would constitute Excess Shares (as defined below) if they were issued.

Each Warrant entitles the registered Warrantholder (as defined below) thereof to purchase one share of Common Stock, subject to the provisions of this Agreement and the relevant Warrant Certificate. Each Warrant Certificate (including any Global Warrant) shall evidence such number of Warrants as is set forth therein, subject to adjustment pursuant to the provisions of the Warrant Certificate.

The Company desires the Warrant Agent to act on behalf of the Company in connection with the registration, transfer, exchange, redemption, exercise and cancellation of the Warrants as provided herein and the Warrant Agent is willing to so act.

The Warrants and the shares of Common Stock issuable upon exercise of the Warrants have been registered with the Securities and Exchange Commission pursuant to the Registration Statement and will be freely transferable by Warrantholders that are not Affiliates of the Company.

Each party agrees as follows for the benefit of the other party and for the equal and ratable benefit of the Warrantholders:

ARTICLE I

DEFINITIONS

Section 1.01. Definitions.

“Affiliate” means, with respect to any Person, any Person directly or indirectly controlling, controlled by or under common control with, such other Person. For purposes of this definition, “control” (including, with correlative meanings, the terms “controlled by” and “under common control with”) when used with respect to any Person, means the possession, directly or indirectly, of the power to cause the direction of management and/or policies of such Person, whether through the ownership of voting securities by contract or otherwise.

“Agent Members” means the securities brokers and dealers, banks and trust companies, clearing organizations and certain other organizations that are participants in the Depositary’s system.

“Charter” means, with respect to any Person, its certificate or articles of incorporation, articles of association, or similar organizational document.

“Common Stock” means the common stock, par value $0.01 per share, of the Company.

“Conversion Right” has the meaning set forth in Section 2 of the form of Warrant Certificate attached as Exhibit A hereto.

“Definitive Warrant” means a Warrant Certificate in definitive form that is not deposited with the Depositary or with the Warrant Agent as custodian for the Depositary.

“Depositary” means The Depository Trust Company, its nominees and their respective successors.

“Excess Shares” has the meaning set forth in the Company’s Charter.

“Exercise Price” has the meaning set forth in the form of Warrant Certificate attached as Exhibit A hereto.

“Expiration Date” has the meaning set forth in the form of Warrant Certificate attached as Exhibit A hereto.

“Global Warrant” has the meaning set forth in Section 2.01(a) hereof.

“Jones Act” has the meaning set forth in Section 3.03 hereof.

“Maritime Laws” has the meaning set forth in the Company’s Charter.

“Non-U.S. Citizen” has the meaning set forth in the Company’s Charter.

“Officer” means the Chief Executive Officer, the President, the Chief Financial Officer, any Vice President, the Treasurer, any Assistant Treasurer, the Secretary or any Assistant Secretary of the Company.

“Officers’ Certificate” means a certificate signed by two Officers.

“Opinion of Counsel” means a written opinion reasonably acceptable to the Warrant Agent from legal counsel. Such counsel may be an employee of or counsel to the Company or the Warrant Agent.

“Person” means an individual, corporation, partnership, joint venture, association, joint-stock company, limited liability company, limited liability partnership, trust, unincorporated organization, or government or any agency or political subdivision thereof or any other entity.

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“Registry” has the meaning set forth in Section 2.03 hereof.

“Required Warrantholders” means holders of a majority of the aggregate number of the Warrrants at the time outstanding.

“Shares” has the meaning set forth in the form of Warrant Certificate attached as Exhibit A hereto.

“Transfer Agent” has the meaning set forth in the form of Warrant Certificate attached as Exhibit A hereto.

“U.S. Citizen” has the meaning set forth in the Company’s Charter.

“Warrant Certificate” means any fully registered certificate (including a Global Warrant) issued by the Company and authenticated by the Warrant Agent under this Agreement evidencing Warrants, in the form attached as Exhibit A hereto.

“Warrantholder” means a registered owner of Warrants as set forth in the Registry.

“Warrant Share Number” has the meaning set forth in the form of Warrant Certificate attached as Exhibit A hereto.

Section 1.02. Rules of Construction.

Unless the text otherwise requires:

(i) “or” is not exclusive;

(ii) “including” means including, without limitation; and

(iii) words in the singular include the plural and words in the plural include the singular.

ARTICLE II

WARRANTS

Section 2.01. Form.

(a) Global Warrants. Except as provided in Section 2.04 or 2.05, Warrants issued in connection with the Exchange Offer or upon conversion of the Notes, and any Warrants issued upon any transfer or exchange thereof, shall be issued in the form of one or more permanent global Warrants in fully registered form with the global securities legend set forth in Exhibit A hereto (each, a “Global Warrant”), which shall be deposited on behalf of the Company with the Warrant Agent, as custodian for the Depositary (or with such other custodian as the Depositary may direct), and registered in the name of the Depositary or a nominee of the Depositary, duly executed by the Company and countersigned by the Warrant Agent as hereinafter provided.

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(b) Book-Entry Provisions. The following provisions of this Section 2.01(b) shall apply only to a Global Warrant deposited with or on behalf of the Depositary:

(i) The Company shall execute and the Warrant Agent shall, in accordance with Section 2.02, countersign, by either manual or facsimile signature, one or more Global Warrants that shall be registered in the name of the Depositary or the nominee of the Depositary. The Warrant Agent shall deliver the Global Warrants to the Depositary or pursuant to the Depositary’s instructions or held by the Warrant Agent as custodian for the Depositary. Each Global Warrant shall be dated the date of its countersignature by the Warrant Agent.

(ii) Agent Members shall have no rights under this Agreement with respect to any Global Warrant held on their behalf by the Depositary or by the Warrant Agent as the custodian of the Depositary or under such Global Warrant except to the extent set forth herein or in a Warrant Certificate, and the Depositary may be treated by the Company, the Warrant Agent and any agent of the Company or the Warrant Agent as the absolute owner of such Global Warrant for all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall (A) prevent the Company, the Warrant Agent or any agent of the Company or the Warrant Agent from giving effect to any written certification, proxy or other authorization furnished by the Depositary or (B) impair, as between the Depositary and the Agent Members, the operation of customary practices of the Depositary governing the exercise of the rights of a holder of a beneficial interest in any Warrant. The rights of beneficial owners in a Global Warrant shall be exercised through the Depositary subject to the applicable procedures of the Depositary except to the extent set forth herein or in a Warrant Certificate.

(c) Definitive Securities. Except as provided in Section 2.04 or 2.05, owners of beneficial interests in Global Warrants will not be entitled to receive physical delivery of Definitive Warrants.

(d) Warrant Certificates. Warrant Certificates shall be in substantially the form attached as Exhibit A hereto and shall be typed, printed, lithographed or engraved or produced by any combination of such methods or produced in any other manner permitted by the rules of any securities exchange on which the Warrants may be listed, all as determined by the Officer or Officers executing such Warrant Certificates, as evidenced by their execution thereof. Any Warrant Certificate shall have such insertions as are appropriate or required or permitted by this Agreement and may have such letters, numbers or other marks of identification and such legends and endorsements, stamped, printed, lithographed or engraved thereon, (i) as the Company may deem appropriate and as are not inconsistent with the provisions of this Agreement, (ii) as may be required to comply with this Agreement, any law or any rule of any securities exchange on which the Warrants may be listed, and (iii) as may be necessary to conform to customary usage.

Section 2.02. Execution and Countersignature.

At least one Officer shall sign the Warrant Certificates for the Company by manual or facsimile signature.

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If an Officer whose signature is on a Warrant Certificate no longer holds that office at the time the Warrant Agent countersigns the Warrant Certificate, the Warrants evidenced by such Warrant Certificate shall be valid nevertheless.

The Warrant Agent shall initially countersign, by either manual or facsimile signature, and deliver Warrant Certificates entitling the Warrantholders thereof to purchase in the aggregate such number of shares of Common Stock as shall be set forth on such Warrant Certificates (subject to adjustment as provided in such Warrant Certificates) upon a written order of the Company signed by one Officer of the Company. Each Warrant Certificate shall be dated the date of its countersignature by the Warrant Agent.

At any time and from time to time after the execution of this Agreement, the Warrant Agent shall upon receipt of a written order of the Company signed by an Officer of the Company countersign, by either manual or facsimile signature, for issue a Warrant Certificate evidencing the number of Warrants specified in such order; provided, however, that the Warrant Agent shall be entitled to receive an Officers’ Certificate and an Opinion of Counsel of the Company containing such representations and opinions as it may reasonably request in connection with such countersignature of Warrants. Such order shall specify the number of Warrants to be evidenced on the Warrant Certificate to be countersigned, the date on which such Warrant Certificate is to be countersigned and the number of Warrants then authorized.

The Warrants evidenced by a Warrant Certificate shall not be valid until an authorized signatory of the Warrant Agent countersigns the Warrant Certificate either manually or by facsimile signature. Such signature shall be solely for the purpose of authenticating the Warrant Certificate and shall be conclusive evidence that the Warrant Certificate so countersigned has been duly authenticated and issued under this Agreement.

Section 2.03. Registry.

The Warrants shall be issued in registered form only. The Warrant Agent shall keep a registry (the “Registry”) of the Warrant Certificates and of their transfer and exchange. The Registry shall show the names and addresses of the respective Warrantholders and the date and number of Warrants evidenced on the face of each of the Warrant Certificates. The Warrantholder of any Global Warrant will be the Depositary or a nominee of the Depositary in whose name the Global Warrant is registered. The Warrant holdings of Agent Members will be recorded on the books of the Depositary. The beneficial interests in the Global Warrant held by customers of Agent Members will be reflected on the books and records of such Agent Members and will not be known to the Warrant Agent, the Company or to the Depositary.

Except as otherwise provided herein or in the Warrant Certificate, the Company and the Warrant Agent may deem and treat any Person in whose name a Warrant Certificate is registered in the Registry as the absolute owner of such Warrant Certificate for all purposes whatsoever and neither the Company nor the Warrant Agent shall be affected by notice to the contrary.

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Section 2.04. Transfer and Exchange.

(a) Transfer and Exchange of Global Warrants.

(i) Registration of the transfer and exchange of Global Warrants or beneficial interests therein shall be effected through the book-entry system maintained by the Depositary, in accordance with this Agreement and the Warrant Certificates and the procedures of the Depositary therefor. A transferor of a beneficial interest in a Global Warrant (or the relevant Agent Member on behalf of such transferor) shall deliver to the Warrant Agent (x) a written order given in accordance with the Depositary’s procedures containing information regarding the account of the Agent Member to be credited with a beneficial interest in the Global Warrant and (y) a written instruction of transfer in form satisfactory to the Warrant Agent, duly executed by the Warrantholder thereof or by his attorney, duly authorized in writing. Additionally, prior to the Warrantholder registering the transfer or making the exchange as requested, the requirements for such transfer or exchange to be issued in a name other than the registered Warrantholder shall be met. Such requirements include, inter alia, a signature guarantee from an eligible guarantor institution participating in a signature guarantee program approved by the Securities Transfer Association, and any other reasonable evidence of authority that may be required by the Warrant Agent. Upon satisfaction of the conditions in this Clause (i), the Warrant Agent shall, in accordance with such instructions, instruct the Depositary to credit to the account of the Agent Member specified in such instructions a beneficial interest in the Global Warrant and to debit the account of the Agent Member making the transfer of the beneficial interest in the Warrant being transferred.

(ii) Notwithstanding any other provisions of this Agreement (other than the provisions set forth in Section 2.05), a Global Warrant may only be transferred as a whole, and not in part, and only by (i) the Depositary, to a nominee of the Depositary, (ii) a nominee of the Depositary, to the Depositary or another nominee of the Depositary, or (iii) the Depositary or any such nominee to a successor Depositary or its nominee.

(iii) In the event that a Global Warrant is exchanged and transferred for Definitive Warrants pursuant to Section 2.05, such Warrants may be exchanged only in accordance with such procedures as are substantially consistent with the provisions of this Section 2.04 and the requirements of any Warrant Certificate and such other procedures as may from time to time be adopted by the Company that are not inconsistent with the terms of this Agreement or of any Warrant Certificate.

(b) Cancellation or Adjustment of Global Warrant. At such time as all beneficial interests in a Global Warrant have been exchanged for Definitive Warrants, redeemed, repurchased or canceled, such Global Warrant shall be returned to the Depositary for cancellation or retained and canceled by the Warrant Agent. At any time prior to such cancellation, if any beneficial interest in a Global Warrant is transferred or exchanged for Definitive Warrants, redeemed, repurchased or canceled, the number of Warrants represented by such Global Warrant shall be reduced and an adjustment shall be made on the books and records of the Warrant Agent to reflect such reduction.

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(c) Obligations with Respect to Transfers and Exchanges of Warrants.

(i) To permit registrations of transfers and exchanges, the Company shall execute and the Warrant Agent shall countersign, by either manual or facsimile signature, Global Warrants and Definitive Warrants as required pursuant to the provisions of Section 2.02 and this Section 2.04.

(ii) No service charge shall be made to a Warrantholder for any registration of transfer or exchange, but the Company may require payment of a sum sufficient to cover any transfer tax, assessments, or similar governmental charge payable in connection therewith.

(iii) All Warrants issued upon any registration of transfer or exchange pursuant to the terms of this Agreement shall be the valid obligations of the Company, entitled to the same benefits under this Agreement as the Warrants surrendered upon such registration for transfer or exchange.

(d) No Obligation of the Warrant Agent.

(i) The Warrant Agent shall have no responsibility or obligation to any beneficial owner of a Global Warrant, any Agent Member or other Person with respect to the accuracy of the records of the Depositary or its nominee or of any participant or member thereof, with respect to any ownership interest in the Warrants or with respect to the delivery to any Agent Member, beneficial owner or other Person (other than the Depositary) of any notice or the payment of any amount, under or with respect to such Warrants. All notices and communications to be given to the Warrantholders and all payments to be made to Warrantholders under the Warrants shall be given or made only to or upon the order of the registered Warrantholders (which shall be the Depositary or its nominee in the case of a Global Warrant). The rights of beneficial owners in any Global Warrant shall be exercised only through the Depositary subject to the applicable rules and procedures of the Depositary. The Warrant Agent may conclusively rely and shall be fully protected in relying upon information furnished by the Depositary with respect to its members, participants and any beneficial owners.

(ii) The Warrant Agent shall have no obligation or duty to monitor, determine or inquire as to compliance with any restrictions on transfer imposed under this Agreement or under applicable law with respect to any transfer of any interest in any Warrant (including any transfer between or among the Agent Members or beneficial owners in any Global Warrant) other than to require delivery of such certificates and other documentation or evidence as are expressly required by, and to do so if and when expressly required by, the terms of this Agreement, and to examine the same to determine substantial compliance as to form with the express requirements hereof.

Section 2.05. Definitive Warrants.

(a) Beneficial interests in a Global Warrant deposited with the Depositary or with the Warrant Agent as custodian for the Depositary pursuant to Section 2.01 shall be transferred to each beneficial owner thereof in the form of Definitive Warrants evidencing a number of Warrants equivalent to such owner’s beneficial interest in such Global Warrant, in exchange for

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such Global Warrant, only if such transfer complies with Section 2.04 and (i) the Depositary notifies the Company that it is unwilling or unable to continue as Depositary for such Global Warrant or if at any time the Depositary ceases to be a “clearing agency” registered under the Securities Exchange Act of 1934, as amended, and, in each such case, a successor Depositary is not appointed by the Company within 90 days of such notice, (ii) the Company, in its sole discretion, notifies the Warrant Agent in writing that it elects to cause the issuance of Definitive Warrants under this Agreement, or (iii) the Company shall be adjudged a bankrupt or insolvent or makes an assignment for the benefit of its creditors or institutes proceedings to be adjudicated a bankrupt or shall consent to the filing of a bankruptcy proceeding against it, or shall file a petition or answer or consent seeking reorganization under Federal bankruptcy laws or any other similar applicable Federal or State law, or shall consent to the filing of any such petition, or shall consent to the appointment of a receiver or custodian of all or any substantial part of its property, or shall admit in writing its inability to pay or meet its debts as they mature, or if a receiver or custodian of it or all or any substantial part of its property shall be appointed, or if a public officer shall have taken charge or control of the Company or of its property or affairs, for the purpose of rehabilitation, conservation or liquidation.

(b) Any Global Warrant that is transferable to the beneficial owners thereof in the form of Definitive Warrants pursuant to this Section 2.05 shall be surrendered by the Depositary to the Warrant Agent, to be so transferred, in whole or from time to time in part, without charge, and the Warrant Agent shall countersign, by either manual or facsimile signature, and deliver to each beneficial owner in the name of such beneficial owner, upon such transfer of each portion of such Global Warrant, Definitive Warrants evidencing a number of Warrants equivalent to such beneficial owner’s beneficial interest in the Global Warrant. The Warrant Agent shall register such transfer in the Registry, and upon such transfer the surrendered Global Warrant shall be cancelled by the Warrant Agent.

(c) All Definitive Warrants issued upon registration of transfer pursuant to this Section 2.05 shall be the valid obligations of the Company, evidencing the same obligations of the Company and entitled to the same benefits under this Agreement and the Global Warrant surrendered for registration of such transfer.

(d) Subject to the provisions of Section 2.05(b), the registered Warrantholder of a Global Warrant may grant proxies and otherwise authorize any Person, including Agent Members and Persons that may hold interests through Agent Members, to take any action that a Warrantholder is entitled to take under this Agreement or the Warrants.

(e) In the event of the occurrence of any of the events specified in Section 2.05(a), the Company will promptly make available to the Warrant Agent a reasonable supply of Definitive Warrants in definitive, fully registered form.

(f) Neither the Company nor the Warrant Agent will be liable or responsible for any registration or transfer of any Warrants that are registered or to be registered in the name of a fiduciary or the nominee of a fiduciary.

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Section 2.06. Replacement Certificates.

If a mutilated Warrant Certificate is surrendered to the Warrant Agent or if the Warrantholder of a Warrant Certificate provides proof reasonably satisfactory to the Company and the Warrant Agent that the Warrant Certificate has been lost, destroyed or wrongfully taken, the Company shall issue and the Warrant Agent shall countersign, by either manual or facsimile signature, a replacement Warrant Certificate of like tenor and representing an equivalent number of Warrants, if the reasonable requirements of the Warrant Agent and of Section 8-405 of the Uniform Commercial Code as in effect in the State of New York are met. If required by the Warrant Agent or the Company, such Warrantholder shall furnish an indemnity bond sufficient in the reasonable judgment of the Company and the Warrant Agent to protect the Company and the Warrant Agent from any loss that either of them may suffer if a Warrant Certificate is replaced. The Company and the Warrant Agent may charge the Warrantholder for their expenses in replacing a Warrant Certificate. Every replacement Warrant Certificate evidences an additional obligation of the Company.

Section 2.07. Outstanding Warrants.

The Warrants outstanding at any time are all Warrants evidenced on all Warrant Certificates authenticated by the Warrant Agent except for those canceled by it and those delivered to it for cancellation. A Warrant ceases to be outstanding if the Company or an Affiliate of the Company holds the Warrant.

If a Warrant Certificate is replaced pursuant to Section 2.06, the Warrants evidenced thereby cease to be outstanding unless the Warrant Agent and the Company receive proof satisfactory to them that the replaced Warrant Certificate is held by a bona fide purchaser.

Section 2.08. Cancellation.

In the event the Company shall purchase or otherwise acquire Definitive Warrants, the same shall thereupon be delivered to the Warrant Agent for cancellation.

The Warrant Agent and no one else shall cancel and dispose of all Warrant Certificates surrendered for registration of transfer, exchange, replacement, exercise or cancellation in its customary manner and deliver a certificate of such disposal to the Company upon its request therefor unless the Company directs the Warrant Agent to deliver canceled Warrant Certificates to the Company. The Company may not issue new Warrant Certificates to replace Warrant Certificates to the extent they evidence Warrants that have been exercised or Warrants that the Company has purchased or otherwise acquired.

Section 2.09. CUSIP Numbers.

The Company in issuing the Warrants may use “CUSIP” numbers (if then generally in use) and, if so, the Warrant Agent shall use “CUSIP” numbers in notices as a convenience to Warrantholders; provided, however, that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the Warrant Certificates or as contained in any notice and that reliance may be placed only on the other identification numbers printed on the Warrant Certificates.

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ARTICLE III

EXERCISE TERMS

Section 3.01. Exercise.

The Exercise Price of each Warrant, the Warrant Share Number and the number of Warrants evidenced by any Warrant Certificate and the Expiration Date of each Warrant shall be set forth in the related Warrant Certificate. The Warrant Share Number is subject to adjustment pursuant to the terms set forth in the Warrant Certificate.

Section 3.02. Manner of Exercise and Issuance of Shares.

Warrants may be exercised in the manner set forth in Section 3 of the Warrant Certificate, and upon any such exercise, Shares shall be issued in the manner set forth in Section 4 of the Warrant Certificate. In connection with any exercise of any Warrant, each Warrantholder may exercise its Conversion Right with respect to such Warrant in the manner set forth in Section 2 of the Warrant Certificate.

Section 3.03. Jones Act Restrictions.

Notwithstanding the other provisions of this Warrant Agreement, in order to facilitate the Company’s compliance with the provisions of 46 U.S.C. § 55102 and the regulations promulgated thereunder, commonly referred to as the “Jones Act,” and related Maritime Laws concerning the ownership of the Common Stock by Non-U.S. Citizens, with regard to its operation of vessels in the coastwise trade of the United States and with certain contractual obligations of the Company with the United States Government:

(a) In connection with any exercise or conversion of the Warrant, a Warrantholder (or, if not the Warrantholder, the Person that the Warrantholder has designated to receive the Common Stock issuable upon exercise or conversion of the Warrants) shall advise the Company whether or not it satisfies the requirements to be a U.S. Citizen. Under its Charter, the Company may require a Warrantholder (or, if not the Warrantholder, the Person that the Warrantholder has designated to receive the Common Stock issuable upon exercise or conversion of the Warrants) to provide it with such documents and other information as it may request as reasonable proof of that the Warrantholder (or, if not the Warrantholder, such other Person that the Warrantholder has designated to receive the Common Stock issuable upon exercise or conversion of the Warrants) satisfies the requirements to be a U.S. Citizen.

(b) No Warrantholder who cannot establish to the Company’s reasonable satisfaction that it (or, if not the Warrantholder, the Person that the Warrantholder has designated to receive the Common Stock issuable upon exercise or conversion of the Warrants) is a U.S. Citizen for purposes of Jones Act compliance may exercise or convert any Warrants to the extent the receipt of the Common Stock deliverable upon exercise or conversion of the Warrants would cause such Person or any Person whose ownership position would be aggregated with that of such Person to exceed 4.9% of the aggregate number of shares of Common Stock outstanding at such time (excluding, for purposes of this Section 3.03(b), shares of Common Stock issuable upon exercise or conversion of all outstanding Warrants and Notes).

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(c) No Warrantholder who cannot establish to the Company’s reasonable satisfaction that it (or, if not the Warrantholder, the Person that the Warrantholder has designated to receive the stock issuable upon exercise or conversion of the Warrants) is a U.S. Citizen for purposes of Jones Act compliance may exercise or convert any Warrants to the extent the shares of Common Stock deliverable upon exercise or conversion of the Warrants would constitute Excess Shares if they were issued, which shall be determined by the Company in its sole discretion at the time of any proposed exercise or conversion of a Warrant.

(d) Any sale, transfer or other disposition of a Warrant by any Warrantholder that is a Non-U.S. Citizen to a Person who is a U.S. Citizen must be a complete transfer of such Warrantholder’s interests to such Person in the Warrant and the Common Stock issuable upon exercise or conversion thereof with no ability to direct or control such Person. The foregoing restriction shall also apply to any Person that the Warrantholder has designated to receive the Common Stock issuable upon exercise or conversion of the Warrants.

Section 3.04. Covenant to Make Stock Certificates Available.

(a) The Warrant Agent is hereby authorized to requisition from time to time from any stock transfer agents of the Company stock certificates required to honor outstanding Warrants upon exercise or conversion thereof in accordance with the terms of this Agreement, and the Company agrees to authorize and direct such transfer agents to comply with all such requests of the Warrant Agent. The Company shall supply such transfer agents with duly executed stock certificates for such purposes and shall provide or otherwise make available any cash or scrip that may be payable upon exercise or conversion of Warrants as provided herein and in each Warrant Certificate.

(b) The Warrant Agent is hereby authorized and directed to create a special account for the reserve of shares of Common Stock to be issued upon exercise or conversion of the Warrants.

(c) In connection with the shares of Common Stock to be issued upon exercise, the Company shall provide an Opinion of Counsel, stating that all such shares, when issued, will be:

(i) registered, or subject to a valid exemption from registration, under the Securities Act of 1933, as amended, and all material and necessary State securities law filings will have been made with respect to such shares; and

(ii) validly issued, fully paid and non-assessable.

ARTICLE IV

ANTIDILUTION PROVISIONS

Section 4.01. Antidilution Adjustments; Notice of Adjustment.

The Warrant Share Number shall be subject to adjustment from time to time as provided in Section 12 of the Warrant Certificate. Whenever the Warrant Share Number is so

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adjusted or is proposed to be adjusted as provided in Section 12 of the Warrant Certificate, the Company shall deliver to the Warrant Agent the notices or statements, and shall cause a copy of such notices or statements to be sent or communicated to each Warrantholder pursuant to Section 6.03, as provided in Section 12(I) of the Warrant Certificate.

Section 4.02. Adjustment to Warrant Certificate.

The form of Warrant Certificate need not be changed because of any adjustment made pursuant to the Warrant Certificate, and Warrant Certificates issued after such adjustment may state the same Exercise Price and the same Warrant Share Number as are stated in the Warrant Certificates initially issued pursuant to this Agreement.

The Company, however, may at any time in its sole discretion make any change in the form of Warrant Certificate that it may deem appropriate to give effect to such adjustments and that does not affect the substance of the Warrant Certificate, and any Warrant Certificate thereafter issued or countersigned, whether in exchange or substitution for an outstanding Warrant Certificate or otherwise, may be in the form as so changed.

ARTICLE V

WARRANT AGENT

Section 5.01. Appointment of Warrant Agent.

The Company hereby appoints the Warrant Agent to act as agent for the Company in accordance with the provisions of this Agreement and the Warrant Agent hereby accepts such appointment. The Warrant Agent shall not be liable for anything that it may do or refrain from doing in connection with this Agreement, except in the case of a final judicial determination of its own gross negligence or willful misconduct.

Section 5.02. Rights and Duties of Warrant Agent.

(a) Agent for the Company. In acting under this Warrant Agreement and in connection with the Warrant Certificates, the Warrant Agent is acting solely as agent of the Company and does not assume any obligation or relationship of agency or trust for or with any of the holders of Warrant Certificates or beneficial owners of Warrants.

(b) Counsel. The Warrant Agent may consult with counsel of its own selection (who may be counsel to the Company), and the advice of such counsel shall be full and complete authorization and protection in respect of any action taken, suffered or omitted by it hereunder in good faith and in accordance with the advice of such counsel.

(c) Documents. The Warrant Agent shall be fully protected, may conclusively rely upon and shall incur no liability for or in respect of any action taken or thing suffered by it in reliance upon any Warrant Certificate, notice, direction, consent, certificate, affidavit, statement or other paper or document reasonably believed by it to be genuine and to have been presented or signed by the proper parties.

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(d) No Implied Obligations. The Warrant Agent shall be obligated to perform only such duties as are specifically set forth herein and in the Warrant Certificates, and no implied duties or obligations of the Warrant Agent shall be read into this Agreement or the Warrant Certificates against the Warrant Agent.

The Warrant Agent shall not be under any obligation to take any action hereunder that may involve it in any expense or liability for which it does not receive indemnity satisfactory to it. The Warrant Agent shall not be accountable or under any duty or responsibility for the use by the Company of any of the Warrant Certificates countersigned by the Warrant Agent and delivered by it to the Warrantholders or on behalf of the Warrantholders pursuant to this Agreement or for the application by the Company of the proceeds of the Warrants. The Warrant Agent shall have no duty or responsibility in case of any default by the Company in the performance of its covenants or agreements contained herein or in the Warrant Certificates or in the case of the receipt of any written demand from a Warrantholder with respect to such default, including any duty or responsibility to initiate or attempt to initiate any proceedings at law or otherwise.

The Warrant Agent may execute any of the powers hereunder or perform any duties hereunder either directly or by or through agents or attorneys and the Warrant Agent shall not be responsible for any misconduct or negligence on the part of any agent or attorney appointed with due care by it hereunder. The Warrant Agent shall not be liable for any action taken, suffered, or omitted to be taken by it in good faith and reasonably believed by it to be authorized or within the discretion or rights or powers conferred upon it by this agreement. In no event shall the Warrant Agent be responsible or liable for special, indirect, or consequential loss or damage of any kind whatsoever (including, but not limited to, loss of profit) irrespective of whether the Warrant Agent has been advised of the likelihood of such loss or damage and regardless of the form of action.

(e) Not Responsible for Adjustments or Validity of Stock.

The Warrant Agent shall not at any time be under any duty or responsibility to any Warrantholder to determine whether any facts exist that may require an adjustment of the Warrant Share Number, or with respect to the nature or extent of any adjustment when made, or with respect to the method employed, or herein or in any supplemental agreement provided to be employed, in making the same. The Warrant Agent shall not be accountable with respect to the validity or value of any Shares or of any securities or property that may at any time be issued or delivered upon the exercise of any Warrant or upon any adjustment pursuant to Section 12 of the Warrant Certificate, and it makes no representation with respect thereto. The Warrant Agent shall not be responsible for any failure of the Company to make any cash payment or to issue, transfer or deliver any Shares or stock certificates upon the surrender of any Warrant Certificate for the purpose of exercise or upon any adjustment pursuant to Section 12 of the Warrant Certificate, or to comply with any of the covenants of the Company contained in the Warrant Certificate.

(f) Notices to the Company. If the Warrant Agent shall receive any written notice or demand (other than Notice of Exercise of Warrants) addressed to the Company by the Warrantholder of a Warrant, the Warrant Agent shall promptly forward such notice or demand to the Company.

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Section 5.03. Individual Rights of Warrant Agent.

The Warrant Agent and any stockholder, director, officer or employee of the Warrant Agent may buy, sell or deal in any of the Warrants or other securities of the Company or its affiliates or become pecuniarily interested in transactions in which the Company or its affiliates may be interested, or contract with or lend money to the Company or its affiliates or otherwise act as fully and freely as though it were not the Warrant Agent under this Agreement. Nothing herein shall preclude the Warrant Agent from acting in any other capacity for the Company or for any other legal entity.

Section 5.04. Warrant Agent’s Disclaimer.

The Warrant Agent shall not be responsible for, and makes no representation as to the validity or adequacy of, this Agreement (except the due and valid authorized execution and delivery of this Agreement by the Warrant Agent) or the Warrant Certificates (except the due countersignature of the Warrant Certificate(s) by the Warrant Agent) and it shall not be responsible for any statement in this Agreement or the Warrant Certificates other than its countersignature thereon.

Section 5.05. Compensation and Indemnity.

(a) The Company agrees to pay the Warrant Agent from time to time reasonable compensation for its services as agreed and to reimburse the Warrant Agent upon request for all out-of-pocket expenses incurred by it, including the reasonable compensation and expenses of the Warrant Agent’s agents and counsel as agreed. The Company shall indemnify the Warrant Agent, its officers, directors, agents and counsel against any loss, liability or expense (including reasonable agents’ and attorneys’ fees and expenses) incurred by it without gross negligence or willful misconduct on its part arising out of or in connection with the acceptance or performance of its duties under this Agreement. The Warrant Agent shall notify the Company promptly of any claim for which it may seek indemnity. The Company need not reimburse any expense or indemnify against any loss or liability incurred by the Warrant Agent through its own willful misconduct or gross negligence. The Company’s payment obligations pursuant to this Section shall survive the termination of this Agreement.

To secure the Company’s payment obligations under this Agreement, the Warrant Agent shall have a lien prior to the Warrantholders on all money or property held or collected by the Warrant Agent.

Section 5.06. Successor Warrant Agent.

(a) Company to Provide and Maintain Warrant Agent. The Company agrees for the benefit of the Warrantholders that there shall at all times be a Warrant Agent hereunder until all the Warrants have been exercised or cancelled or are no longer exercisable.

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(b) Resignation and Removal. The Warrant Agent may at any time resign by giving written notice to the Company of such intention on its part, specifying the date on which its desired resignation shall become effective; provided, however, that such date shall not be less than 60 days after the date on which such notice is given unless the Company otherwise agrees. The Warrant Agent hereunder may be removed at any time by the filing with it of an instrument in writing signed by or on behalf of the Company or the Required Warrantholders and specifying such removal and the date when it shall become effective, which date shall not be less than 60 days after such notice is given unless the Warrant Agent otherwise agrees. Any removal under this Section shall take effect upon the appointment by the Company or the Required Warrantholders as hereinafter provided of a successor Warrant Agent (which shall be (i) a bank or trust company, (ii) organized under the laws of the United States of America or one of the states thereof, (iii) authorized under the laws of the jurisdiction of its organization to exercise corporate trust powers, (iv) having a combined capital and surplus of at least $50,000,000 (as set forth in its most recent reports of condition published pursuant to law or to the requirements of any United States federal or state regulatory or supervisory authority) and (v) having an office in the Borough of Manhattan, The City of New York) and the acceptance of such appointment by such successor Warrant Agent. The obligations of the Company under Section 5.05 shall continue to the extent set forth herein notwithstanding the resignation or removal of the Warrant Agent.

The Warrant Agent may execute any of the powers hereunder or perform any duties hereunder either directly or by or through agents or attorneys and the Warrant Agent shall not be responsible for any misconduct or negligence on the part of any agent or attorney appointed with due care by it hereunder. The Warrant Agent shall not be liable for any action taken, suffered, or omitted to be taken by it in good faith and reasonably believed by it to be authorized or within the discretion or rights or powers conferred upon it by this agreement. In no event shall the Warrant Agent be responsible or liable for special, indirect, or consequential loss or damage of any kind whatsoever (including, but not limited to, loss of profit) irrespective of whether the Warrant Agent has been advised of the likelihood of such loss or damage and regardless of the form of action.

(c) Company to Appoint Successor. In the event that at any time the Warrant Agent shall resign, or shall be removed, or shall become incapable of acting, or shall be adjudged bankrupt or insolvent, or shall commence a voluntary case under the Federal bankruptcy laws, as now or hereafter constituted, or under any other applicable Federal or State bankruptcy, insolvency or similar law or shall consent to the appointment of or taking possession by a receiver, custodian, liquidator, assignee, trustee, sequestrator (or other similar official) of the Warrant Agent or its property or affairs, or shall make an assignment for the benefit of creditors, or shall admit in writing its inability to pay its debts generally as they become due, or shall take corporate action in furtherance of any such action, or a decree or order for relief by a court having jurisdiction in the premises shall have been entered in respect of the Warrant Agent in an involuntary case under the Federal bankruptcy laws, as now or hereafter constituted, or any other applicable Federal or State bankruptcy, insolvency or similar law, or a decree or order by a court having jurisdiction in the premises shall have been entered for the appointment of a receiver, custodian, liquidator, assignee, trustee, sequestrator (or similar official) of the Warrant Agent or of its property or affairs, or any public officer shall take charge or control of the Warrant Agent or of its property or affairs for the purpose of rehabilitation, conservation, winding up or

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liquidation, a successor Warrant Agent, qualified as aforesaid, shall be appointed by the Company by an instrument in writing, filed with the successor Warrant Agent. In the event that a successor Warrant Agent is not appointed by the Company, a successor Warrant Agent, qualified as aforesaid, may be appointed by the Warrant Agent or the Required Warrantholders or the Warrant Agent or the Required Warrantholders may petition a court to appoint a successor Warrant Agent. Upon the appointment as aforesaid of a successor Warrant Agent and acceptance by the successor Warrant Agent of such appointment, the Warrant Agent shall cease to be Warrant Agent hereunder; provided, however, that in the event of the resignation of the Warrant Agent under this subsection (c), such resignation shall be effective on the earlier of (i) the date specified in the Warrant Agent’s notice of resignation and (ii) the appointment and acceptance of a successor Warrant Agent hereunder.

(d) Successor to Expressly Assume Duties. Any successor Warrant Agent appointed hereunder shall execute, acknowledge and deliver to its predecessor and to the Company an instrument accepting such appointment hereunder, and thereupon such successor Warrant Agent, without any further act, deed or conveyance, shall become vested with all the rights and obligations of such predecessor with like effect as if originally named as Warrant Agent hereunder, and such predecessor, upon payment of its charges and disbursements then unpaid, shall thereupon become obligated to transfer, deliver and pay over, and such successor Warrant Agent shall be entitled to receive, all monies, securities and other property on deposit with or held by such predecessor, as Warrant Agent hereunder.

(e) Successor by Merger. Any entity into which the Warrant Agent hereunder may be merged or consolidated, or any entity resulting from any merger or consolidation to which the Warrant Agent shall be a party, or any entity to which the Warrant Agent shall sell or otherwise transfer all or substantially all of its assets and business, shall be the successor Warrant Agent under this Agreement without the execution or filing of any paper or any further act on the part of any of the parties hereto; provided, however, that it shall be qualified as aforesaid.

Section 5.07. Representations of the Company.

The Company represents and warrants to the Warrant Agent that:

(a) the Company has been duly organized and is validly existing under the laws of the jurisdiction of its incorporation;

(b) this Agreement has been duly authorized, executed and delivered by the Company and is enforceable against the Company in accordance with its terms, except as may be limited by bankruptcy, insolvency, moratorium, reorganization and other similar laws affecting the enforcement of creditors’ rights generally; and

(c) the execution and delivery of this Agreement does not, and the issuance of the Warrants in accordance with the terms of this Agreement and the Warrant Certificate will not, (i) violate the Company’s Charter or by-laws, (ii) violate any law or regulation applicable to the Company or order or decree of any court or public authority having jurisdiction over the Company, or (iii) result in a breach of any mortgage, indenture, contract, agreement or undertaking to which the Company is a party or by which it is bound, except in the case of (ii) and (iii) for any violations or breaches that could not reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole.

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ARTICLE VI

MISCELLANEOUS

Section 6.01. Persons Benefitting.

Nothing in this Agreement is intended or shall be construed to confer upon any Person other than the Company, the Warrant Agent and the Warrantholders any right, remedy or claim under or by reason of this Agreement or any part hereof.

Section 6.02. Amendment.

This Agreement and the Warrants may be amended by the parties hereto without the consent of any Warrantholder for the purpose of curing any ambiguity, or of curing, correcting or supplementing any defective provision contained herein or therein or adding or changing any other provisions with respect to matters or questions arising under this Agreement or the Warrants as the Company and the Warrant Agent may deem necessary or desirable; provided, however, that such action shall not adversely affect the rights of any of the Warrantholders in any material respect. This Agreement and the Warrants may be amended or supplemented at any time with the written consent of the Required Warrantholders; provided that the consent of each Warrantholder affected thereby shall be required for any amendment pursuant to which (i) the Warrant Share Number would be decreased (in each case, other than pursuant to adjustments provided for in Section 12 of the Warrant Certificate), (ii) the time period during which the Warrants are exercisable would be shortened or (iii) any change adverse to the Warrantholder would be made to the anti-dilution provisions set forth in Article IV of this Agreement or Section 12 of the Warrant Certificate. In determining whether the Required Warrantholders have concurred in any direction, waiver or consent, Warrants owned by the Company or by any Affiliate of the Company shall be disregarded and deemed not to be outstanding, except that, for the purpose of determining whether the Warrant Agent shall be protected in relying on any such direction, waiver or consent, only Warrants that the Warrant Agent knows are so owned shall be so disregarded. Also, subject to the foregoing, only Warrants outstanding at the time shall be considered in any such determination. The Warrant Agent shall have no duty to determine whether any such amendment would have an effect on the rights or interests of the holders of the Warrants. Upon receipt by the Warrant Agent of an Officer’s Certificate and an Opinion of Counsel, each stating that all conditions precedent to the execution of the amendment have been complied with and such execution is permitted by this Agreement and the Warrant Certificate, the Warrant Agent shall join in the execution of such amendment; provided, that the Warrant Agent may, but shall not be obligated to, execute any amendment or supplement which affects the rights or changes or increases the duties or obligations of the Warrant Agent.

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Section 6.03. Notices.

Any notice or communication shall be in writing and delivered in person or mailed by first-class mail addressed as follows:

if to the Company:

Horizon Lines, Inc.

4064 Colony Road, Suite 200

Charlotte, NC 28211

Telephone: (704) 973-7000

Facsimile: (704) 973-7010

Attention: General Counsel

if to the Warrant Agent:

The Bank of New York Mellon Trust Company, N.A.

10161 Centurion Parkway

Jacksonville, FL

Facsimile: (904) 645-1921

Attention: Corporate Trust Administration

The Company or the Warrant Agent by notice to the other may designate additional or different addresses for subsequent notices or communications.

Unless the Warrant is a Global Warrant, any notice or communication mailed to a Warrantholder shall be mailed to the Warrantholder at the Warrantholder’s address as it appears on the Registry and shall be sufficiently given if so mailed within the time prescribed. Any notice to the owners of a beneficial interest in a Global Warrant shall be distributed through the Depositary in accordance with the procedures of the Depositary. Communications to such Warrantholder shall be deemed to be effective at the time of dispatch to the Depositary.

Failure to provide a notice or communication to a Warrantholder or any defect in it shall not affect its sufficiency with respect to other Warrantholders.

If a notice or communication is provided in the manner provided above, it is duly given, whether or not the intended recipient actually receives it.

Section 6.04. Governing Law.

This Agreement will be governed by and construed in accordance with the laws of the State of New York applicable to contracts made and to be performed entirely within such State.

Section 6.05. Successors.

All agreements of the Company in this Agreement and the Warrants shall bind its successors. All agreements of the Warrant Agent in this Agreement shall bind its successors.

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Section 6.06. Multiple Originals.

The parties may sign any number of copies of this Agreement. Each signed copy shall be an original, but all of them together represent the same agreement. One signed copy shall be sufficient to prove this Agreement.

Section 6.07. Inspection of Agreement.

A copy of this Agreement shall be made available at all reasonable times for inspection by any registered Warrantholder or owner of a beneficial interest in a Global Warrant at the principal office of the Warrant Agent (or successor warrant agent).

Section 6.08. Table of Contents.

The table of contents and headings of the Articles and Sections of this Agreement have been inserted for convenience of reference only, are not intended to be considered a part hereof and shall not modify or restrict any of the terms or provisions hereof.

Section 6.09. Severability.

The provisions of this Agreement are severable, and if any clause or provision shall be held invalid, illegal or unenforceable in whole or in part in any jurisdiction, then such invalidity or unenforceability shall affect in that jurisdiction only such clause or provision, or part thereof, and shall not in any manner affect such clause or provision in any other jurisdiction or any other clause or provision of this Agreement in any jurisdiction.

Section 6.10. Waiver of Jury Trial.

Each of the Company and the Warrant Agent hereby irrevocably waives, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising out of or relating to this Agreement, the Warrants, the Notes or the transactions contemplated hereby.

Section 6.11. Force Majeure.

In no event shall the Warrant Agent be responsible or liable for any failure or delay in the performance of its obligations hereunder arising out of or caused by, directly or indirectly, forces beyond its control, including, without limitation, strikes, work stoppages, accidents, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God, and interruptions, loss or malfunctions of utilities, communications or computer (software and hardware) services; it being understood that the Warrant Agent shall use reasonable efforts which are consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances.

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

HORIZON LINES, INC.
By:
	Name:
	Title:
THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as Warrant Agent,
By:
	Name:
	Title:

EXHIBIT A

FORM OF WARRANT

[Global Securities Legend]

Unless this Global Warrant is presented by an authorized representative of The Depository Trust Company, a New York corporation (“DTC”), New York, New York, to the Company or its agent for registration of transfer, exchange or payment, and any Warrant Certificate issued is registered in the name of Cede & Co. or such other name as is requested by an authorized representative of DTC (and any payment is made to Cede & Co. or to such other entity as is requested by an authorized representative of DTC), any transfer, pledge or other use hereof for value or otherwise by or to any person is wrongful inasmuch as the registered owner hereof, Cede & Co., has an interest herein.

Transfers of this Global Warrant shall be limited to transfers in whole, but not in part, to nominees of DTC or to a successor thereof or such successor’s nominee and transfers of portions of this Global Warrant shall be limited to transfers made in accordance with the restrictions set forth in the Warrant Agreement referred to on the reverse hereof.

GLOBAL WARRANT

representing

WARRANTS

to purchase

Shares of

Common Stock

of

HORIZON LINES, INC.

No. [    ] CUSIP No: 44044K 119

This Warrant Certificate is issued under and in accordance with a Warrant Agreement dated as of October 5, 2011 (the “Warrant Agreement”), among Horizon Lines, Inc. (the “Company”) and The Bank of New York Mellon Trust Company, N.A., as warrant agent (the “Warrant Agent”), and is subject to the terms and provisions contained in the Warrant Agreement, to all of which terms and provisions the beneficial owners of the Warrants and the Warrantholders consent by acceptance hereof.

1. Definitions. Unless the context otherwise requires, when used herein the following terms shall have the meanings indicated. Any capitalized terms used but not defined in this Warrant Certificate shall have the meanings given to such terms in the Warrant Agreement.

“Board of Directors” means the board of directors of the Company, including any duly authorized committee thereof.

“Capital Stock” means (A) with respect to any Person that is a corporation or company, any and all shares, interests, participations or other equivalents (however designated) of capital or capital stock of such Person and (B) with respect to any Person that is not a corporation or company, any and all partnership or other equity interests of such Person.

“Common Stock” means the common stock, par value $0.01 per share, of the Company.

“Common Stock Equivalent” means any security or obligation which by its terms is, directly or indirectly, convertible into, or exchangeable or exercisable for, shares of Common Stock, including, without limitation, any preferred stock and any option, warrant or other subscription or purchase right with respect to Common Stock or any Common Stock Equivalent.

“Current Market Price” means, as of any date, (a) the average of the daily Market Price of the Common Stock during the immediately preceding 30 trading days ending on such date or (b) if the Common Stock is not then listed or admitted to trading on any national securities exchange, the Market Price on that date.

“Excess Shares” has the meaning set forth in the Company’s Charter.

“Excluded Transaction” means any issuance of any shares of Common Stock or Common Stock Equivalents (a) pursuant to any present or future plan providing for the reinvestment of dividends or interest payable on the Company’s securities and the investment of additional optional amounts in shares of Common Stock under any such plan, (b) pursuant to any present or future employee, director or consultant benefit plan or program of or assumed by the Company or any of its subsidiaries, (c) pursuant to any option, warrant, right or exercisable, exchangeable or convertible security not described in (b) above and outstanding as of the date of the Warrant Agreement, or (d) in order to redeem Common Stock (or issued pursuant to Common Stock Equivalents that are issued to redeem such Common Stock) that constitute Excess Shares under the Company’s Charter as amended from time to time.

“Exercise Price” means $0.01.

“Expiration Date” means the twenty-fifth anniversary of the date of the Warrant Agreement.

“Fair Market Value” means, with respect to any security or other property, the fair market value of such security or other property as determined by in good faith by the Board of Directors in reliance on an opinion of a nationally recognized independent investment banking corporation retained by the Company for this purpose.

“Maritime Laws” has the meaning set forth in the Company’s Charter.

“Market Price” means, with respect to a particular security, the per-share volume weighted average price of such security for a period of 30 consecutive trading days, as calculated on Bloomberg (or, if such volume weighted average price is unavailable via Bloomberg, the average market value of one share of such security over such 30 trading day period determined, using a volume weighted average method, by a nationally recognized independent investment banking firm retained for this purpose by the Company), or if such security is not listed or admitted to trading on any national securities exchange, the average of the closing bid and ask prices as furnished by two members of the Financial Industry Regulatory Authority, Inc. selected from time to time by the Company for that purpose. “Market Price” shall be determined without reference to after hours or extended hours trading. If such security is not listed and traded in a manner that the quotations referred to above are available for the period required hereunder, the Market Price per share of Common Stock shall be deemed to be the fair market value per share of such security as determined in good faith by the Board of Directors in reliance on an opinion of a nationally recognized independent investment banking corporation retained by the Company for this purpose; provided that if any such security is listed or traded on a non-U.S. market, such fair market value shall be determined by reference to the closing price of such security as of the end of the most recently ended Business Day in such market prior to the date of determination; and further, provided that if making such determination requires the conversion of any currency other than U.S. dollars into U.S. dollars, such conversion shall be done in accordance with customary procedures based on the rate for conversion of such currency into U.S. dollars displayed on the relevant page by Bloomberg L.P. (or any successor or replacement service) on or by 4:00 p.m., New York City time, on such exercise date. For the purposes of determining the

A-2

Market Price of the Common Stock on the “trading day” preceding, on or following the occurrence of an event, (i) that trading day shall be deemed to commence immediately after the regular scheduled closing time of trading on the New York Stock Exchange or, if trading is closed at an earlier time, such earlier time and (ii) that trading day shall end at the next regular scheduled closing time, or if trading is closed at an earlier time, such earlier time (for the avoidance of doubt, and as an example, if the Market Price is to be determined as of the last trading day preceding a specified event and the closing time of trading on a particular day is 4:00 p.m. and the specified event occurs at 5:00 p.m. on that day, the Market Price would be determined by reference to such 4:00 p.m. closing price).

“New Issuance” has the meaning set forth in Section 12(B).

“Non-U.S. Citizen” has the meaning set forth in the Company’s Charter.

“Relevant Date” has the meaning set forth in Section 12(B).

“Shares” has the meaning set forth in Section 2.

“Significant Transaction” means:

(a) any reorganization, reclassification or other change of outstanding shares of Common Stock (other than a change in par value, or from par value to no par value, or from no par value to par value);

(b) any voluntary sale, conveyance, exchange or transfer by the Company to any other Person of all or a material portion of the assets of the Company or any material subsidiary thereof;

(c) any voluntary sale, conveyance, exchange or transfer by the stockholders of the Company to any Person of the Capital Stock of the Company if, immediately after giving effect to such sale, conveyance, exchange or transfer, the stockholders of the Company immediately prior to such sale, conveyance, exchange or transfer do not hold Capital Stock of the Company representing at least a majority of the voting power of the Company; and

(d) any merger, consolidation or other business combination of the Company with any other Person (including by way of a tender offer) if, immediately after giving effect to such merger, consolidation or other business combination, the stockholders of the Company immediately prior to such merger, consolidation or other business combination do not hold Capital Stock of the surviving Person representing at least a majority of the voting power of the surviving Person.

“trading day” means (A) if the shares of Common Stock are not traded on any national or regional securities exchange or association or over-the-counter market, a Business Day or (B) if the shares of Common Stock are traded on any national or regional securities exchange or association or over-the-counter market, a Business Day on which such relevant exchange or quotation system is scheduled to be open for business and on which the shares of Common Stock (i) are not suspended from trading on any national or regional securities exchange or association or over-the-counter market for any period or periods aggregating one

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half hour or longer; and (ii) have traded at least once on the national or regional securities exchange or association or over-the-counter market that is the primary market for the trading of the shares of Common Stock. The term “trading day” with respect to any security other than the Common Stock shall have a correlative meaning based on the primary exchange or quotation system on which such security is listed or traded.

“Transfer Agent” means American Stock Transfer & Trust Company, as transfer agent of the Company, and any successor transfer agent.

“U.S. Citizen” has the meaning set forth in the Company’s Charter.

“Warrant” means a right to purchase a number of shares of the Company’s Common Stock equal to the Warrant Share Number as provided herein. References herein to “Warrant” shall include the Global Warrant where the context requires.

“Warrant Share Number” means one share of Common Stock, as subsequently adjusted pursuant to the terms of this Warrant and the Warrant Agreement.

2. Number of Shares; Exercise Price. This certifies that, for value received, Cede & Co., and any of its registered assigns, is the registered owner of the number of Warrants set forth on Schedule A hereto, each of which entitles the Warrantholder to purchase from the Company, upon the terms and subject to the conditions hereinafter set forth, a number of fully paid and nonassessable shares of Common Stock (each a “Share” and collectively the “Shares”) equal to the Warrant Share Number at a purchase price per share equal to the Exercise Price. In lieu of payment of the aggregate Exercise Price, the Warrantholder shall have the right (but not the obligation) to require the Company to convert the Warrants (the “Conversion Right”), upon the terms and subject to the conditions hereafter set forth, into a number of Shares equal to the Warrant Share Number without any required payment. The Warrant Share Number is subject to adjustment as provided herein, and all references to “Warrant Share Number” herein shall be deemed to include any such adjustment or series of adjustments.

3. Exercise of Warrant; Term. Subject to Section 2 and Section 17, to the extent permitted by applicable laws and regulations, all or a portion of the Warrants evidenced by this Warrant Certificate are exercisable or convertible by the Warrantholder, at any time or from time to time after the execution and delivery of this Warrant Certificate by the Company on the date hereof, but in no event later than 5:00 p.m., New York City time, on the Expiration Date, by (A) delivery to the Warrant Agent of a Notice of Exercise, in the form annexed hereto, duly completed and executed (or to the Company or to such other office or agency of the Company in the United States as the Company may designate by notice in writing to the Warrantholders pursuant to Section 18), and (B) if applicable, payment of the Exercise Price for the Shares thereby purchased by having the Company withhold, from the shares of Common Stock that would otherwise be delivered to such Warrantholder upon such exercise, Shares issuable upon exercise of the Warrants so exercised equal in value to the aggregate Exercise Price as to such Shares, based on the Market Price of the Common Stock on the trading day on which such Warrants are exercised and the Notice of Exercise is delivered to the Warrant Agent pursuant to this Section 3. For the avoidance of doubt, if Warrants are exercised such that the Exercise Price would exceed the value of the Shares issuable upon exercise, no amount shall be due and payable

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by the Warrantholder to the Company. In the case of a Global Warrant, any person with a beneficial interest in such Global Warrant shall effect compliance with the requirements in clauses (A) and (B) above through the relevant Agent Member in accordance with procedures of the Depositary.

In the case of a Global Warrant, whenever some but not all of the Warrants represented by such Global Warrant are exercised in accordance with the terms thereof and of the Warrant Agreement, such Global Warrant shall be surrendered by the Warrantholder to the Warrant Agent, which shall cause an adjustment to be made to Schedule A to such Global Warrant so that the number of Warrants represented thereby will be equal to the number of Warrants theretofor represented by such Global Warrant less the number of Warrants then exercised. The Warrant Agent shall thereafter promptly return such Global Warrant to the Warrantholder or its nominee or custodian. In the case of a Definitive Warrant, whenever some but not all of the Warrants represented by such Definitive Warrant are exercised in accordance with the terms thereof and of the Warrant Agreement, the Warrantholder shall be entitled, at the request of such Warrantholder, to receive from the Company within a reasonable time, not to exceed three business days, a new Definitive Warrant in substantially identical form for the number of Warrants equal to the number of Warrants theretofor represented by such Definitive Warrant less the number of Warrants then exercised.

If this Warrant Certificate shall have been exercised in full, the Warrant Agent shall promptly cancel such certificate following its receipt from the Warrantholder or the Depositary, as applicable.

Notwithstanding anything in this Warrant Certificate to the contrary, in the case of Warrants evidenced by a Global Warrant, any Agent Member may, without the consent of the Warrant Agent or any other person, on its own behalf and on behalf of any beneficial owner for which it is acting, enforce, and may institute and maintain, any suit, action or proceeding against the Company suitable to enforce, or otherwise in respect of, its right to exercise, and to receive Shares for, its Warrants as provided in the Global Warrant, and to enforce the Warrant Agreement.

4. Issuance of Shares; Authorization; Listing. Shares issued upon exercise or conversion of Warrants evidenced by this Warrant Certificate shall be (i) issued in such name or names as the exercising Warrantholder may designate and (ii) delivered by the Transfer Agent to such Warrantholder or its nominee or nominees (A) via book-entry transfer crediting the account of such Warrantholder (or the relevant Agent Member for the benefit of such Warrantholder) through the Depositary’s DWAC system (if the Transfer Agent participates in such system), or (B) otherwise in certificated form by physical delivery to the address specified by the Warrantholder in the Notice of Exercise. The Company shall use its commercially reasonable efforts to cause its Transfer Agent to be a participant in the Depositary’s DWAC system. The Company shall cause the number of full Shares to which such Warrantholder shall be entitled to be so delivered by the Transfer Agent within a reasonable time, not to exceed three Business Days after the date on which Warrants evidenced by this Warrant Certificate have been duly exercised or converted in accordance with the terms hereof.

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The Company hereby represents and warrants that any Shares issued upon the exercise or conversion of Warrants evidenced by this Warrant Certificate in accordance with the provisions of Section 3 will be duly and validly authorized and issued, fully paid and nonassessable and free from all taxes, liens and charges (other than liens or charges created by a Warrantholder, income and franchise taxes incurred in connection with the exercise of the Warrant or taxes in respect of any transfer occurring contemporaneously therewith). The Company agrees that the Shares so issued will be deemed to have been issued to a Warrantholder as of the close of business on the date on which Warrants evidenced by this Warrant Certificate have been duly exercised or converted, notwithstanding that the stock transfer books of the Company may then be closed or certificates representing such Shares may not be actually delivered on such date. The Company will at all times reserve and keep available, out of its authorized but unissued Common Stock, solely for the purpose of providing for the exercise of Warrants evidenced by this Warrant Certificate, the aggregate number of shares of Common Stock then issuable upon exercise hereof at any time. The Company will (A) procure, at its sole expense, the listing of the Shares issuable upon exercise hereof at any time, subject to issuance or notice of issuance, on all principal stock exchanges on which the Common Stock is then listed or traded and (B) maintain such listings of such Shares at all times after issuance. The Company will use reasonable best efforts to ensure that the Shares may be issued without violation of any applicable law or regulation or of any requirement of any securities exchange on which the Shares are listed or traded.

5. No Fractional Shares or Scrip. No fractional Shares or scrip representing fractional Shares shall be issued upon any exercise of Warrants evidenced by this Warrant Certificate. In lieu of any fractional Share that would otherwise be issued to a Warrantholder upon the exercise of any Warrants, the Company shall round up to the nearest whole number the number of Shares to be issued to such Warrantholder.

6. No Rights as Stockholders; Transfer Books. Warrants evidenced by this Warrant Certificate do not entitle the Warrantholder or the owner of any beneficial interest in such Warrants to any voting rights or other rights as a stockholder of the Company prior to the date of exercise or conversion hereof. The Company shall at no time close its transfer books against transfer of Warrants in any manner which interferes with the timely exercise hereof.

7. Charges, Taxes and Expenses. Issuance of Shares in certificated or book-entry form to the Warrantholder upon the exercise or conversion of Warrants evidenced by this Warrant Certificate shall be made without charge to the Warrantholder for any issue or transfer tax or other incidental expense in respect of the issuance of such Shares (other than liens or charges created by a Warrantholder, income and franchise taxes incurred in connection with the exercise or conversion of the Warrant or taxes in respect of any transfer occurring contemporaneously therewith), all of which taxes and expenses shall be paid by the Company.

8. Transfer/Assignment. This Warrant Certificate and all rights hereunder are transferable, in whole or in part, upon the books of the Company (or an agent duly appointed by the Company) by the registered holder hereof in person or by duly authorized attorney, and one or more new Warrant Certificates shall be made and delivered by the Company, of the same tenor and date as this Warrant Certificate but registered in the name of one or more transferees, upon surrender of this Warrant Certificate, duly endorsed, to the office or agency of the

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Company described in Section 3; provided that if this Warrant Certificate is a Global Warrant registered in the name of the Depositary, transfers of such Global Warrant may only be made as a whole, and not in part, and only by (i) the Depositary to a nominee of the Depositary, (ii) a nominee of the Depositary to the Depositary or another nominee of the Depositary or (iii) the Depositary or any such nominee to a successor Depositary or its nominee. All expenses (other than stock transfer taxes) and other charges payable in connection with the preparation, execution and delivery of the new Warrant Certificates pursuant to this Section 8 shall be paid by the Company.

If this Warrant Certificate is a Global Warrant, then so long as the Global Warrant is registered in the name of the Depositary, the holders of beneficial interests in the Warrants evidenced thereby shall have no rights under this Warrant Certificate with respect to the Global Warrant held on their behalf by the Depositary or the Warrant Agent as its custodian, and the Depositary may be treated by the Company, the Warrant Agent and any agent of the Company or the Warrant Agent as the absolute owner of the Global Warrant for all purposes whatsoever except to the extent set forth herein. Accordingly, any such owner’s beneficial interest in the Global Warrant will be shown only on, and the transfer of such interest shall be effected only through, records maintained by the Depositary or the Agent Members, and neither the Company nor the Warrant Agent shall have any responsibility with respect to such records maintained by the Depositary or the Agent Members. Notwithstanding the foregoing, nothing herein shall (i) prevent the Company, the Warrant Agent or any agent of the Company or the Warrant Agent from giving effect to any written certification, proxy or other authorization furnished by the Depositary or (ii) impair, as between the Depositary and the Agent Members, the operation of customary practices governing the exercise of the rights of a holder of a beneficial interest in any Warrant. Except as may otherwise be provided in this Warrant Certificate or the Warrant Agreement, the rights of beneficial owners in a Global Warrant shall be exercised through the Depositary subject to the applicable procedures of the Depositary. Any holder of the Global Warrant shall, by acceptance of the Global Warrant, agree that transfers of beneficial interests in the Global Warrant may be effected only through a book-entry system maintained by the Depositary, and that ownership of a beneficial interest in the Warrants represented thereby shall be required to be reflected in book-entry form.

A Global Warrant shall be exchanged for Definitive Warrants, and Definitive Warrants may be transferred or exchanged for a beneficial interest in a Global Warrant, only at such times and in the manner specified in the Warrant Agreement. Subject to the provisions of the Warrant Agreement, the holder of a Global Warrant may grant proxies and otherwise authorize any person, including Agent Members and persons that may hold beneficial interests in such Global Warrant through Agent Members, to take any action that a Warrantholder is entitled to take under a Warrant or the Warrant Agreement.

9. Exchange and Registry of Warrants. This Warrant Certificate is exchangeable, upon the surrender hereof by the Warrantholder to the Company, for a new Warrant Certificate or Warrant Certificates of like tenor and representing the same aggregate number of Warrants. The Company or an agent duly appointed by the Company (which initially shall be the Warrant Agent) shall maintain a Registry showing the name and address of the Warrantholder as the registered holder of this Warrant Certificate. This Warrant Certificate may be surrendered for exchange or exercise in accordance with its terms, at the office of the Company or any such agent, and the Company shall be entitled to rely in all respects, prior to written notice to the contrary, upon such Registry.

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10. Loss, Theft, Destruction or Mutilation of Warrant Certificate. Upon receipt by the Company of proof reasonably satisfactory to it of the loss, theft, destruction or mutilation of this Warrant Certificate, and in the case of any such loss, theft or destruction, upon receipt of a bond, indemnity or security reasonably satisfactory to the Company and the Warrant Agent, or, in the case of any such mutilation, upon surrender and cancellation of this Warrant Certificate, the Company shall make and deliver, in lieu of such lost, stolen, destroyed or mutilated Warrant Certificate, a new Warrant Certificate of like tenor and representing the same aggregate number of Warrants as provided for in such lost, stolen, destroyed or mutilated Warrant Certificate.

11. Saturdays, Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right required or granted herein shall not be a business day, then such action may be taken or such right may be exercised on the next succeeding day that is a business day.

12. Adjustments and Other Rights. The Warrant Share Number shall be subject to adjustment from time to time as follows; provided that if more than one subsection of this Section 12 is applicable to a single event, the subsection shall be applied that produces the largest adjustment and no single event shall cause an adjustment under more than one subsection of this Section 12 so as to result in duplication:

(A) Dividend, Subdivision, Combination or Reclassification of Common Stock. In the event that the Company shall at any time or from time to time, after the issuance of this Warrant but prior to the exercise or conversion hereof, (a) make a dividend or distribution on the outstanding shares of Common Stock payable in shares of Common Stock, (b) subdivide the outstanding shares of Common Stock into a larger number of shares, (c) combine the outstanding shares of Common Stock into a smaller number of shares or (d) issue any shares of its Capital Stock in a reclassification of the Common Stock (other than any such event for which an adjustment is made pursuant to another provision of this Section 12), then, and in each such case, the Warrant Share Number immediately prior to such event shall be adjusted (and any other appropriate actions shall be taken by the Company) so that the Warrantholder shall be entitled to receive upon the exercise or conversion of this Warrant the number of shares of Common Stock or other securities of the Company that the Warrantholder would have owned or would have been entitled to receive upon or by reason of any event described above, had this Warrant been exercised or converted immediately prior to the occurrence of such event. Any adjustment made pursuant to this Section 12(A) shall become effective retroactively (i) in the case of any such dividend or distribution, to the date immediately following the close of business on the record date for the determination of holders of shares of Common Stock entitled to receive such dividend or distribution or (ii) in the case of any such subdivision, combination or reclassification, to the close of business on the date on which such corporate action becomes effective.

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(B) Issuance of Common Stock or Common Stock Equivalents Below Current Market Price.

(a) Adjustment of Warrant Share Number. Subject to Section 12(B)(d), if, at any time or from time to time after the issuance of this Warrant but prior to the exercise or conversion hereof, the Company shall issue or sell any shares of Common Stock or Common Stock Equivalents (each such issuance or sale, a “New Issuance”) at a new issue price that is less than the Current Market Price as of the record date or issuance date, as the case may be, for such New Issuance (the “Relevant Date”), then, and in each such case, the Warrant Share Number shall be increased to a number equal to the product of (x) the Warrant Share Number immediately prior to the Relevant Date multiplied by (y) the quotient of:

(i) the sum of (A) the number of shares of Common Stock (determined on a fully-diluted basis) outstanding on the Relevant Date, plus (B) the number of additional shares of Common Stock (determined on a fully-diluted basis) issued or to be issued in such New Issuance (including the maximum number of shares of Common Stock into which the Common Stock Equivalents issued or to be issued in such New Issuance initially are convertible, exchangeable or exercisable); divided by

(ii) the sum of (A) the number of shares of Common Stock (determined on a fully-diluted basis) outstanding on the Relevant Date, plus (B) the number of shares of Common Stock which the aggregate consideration, before the deduction of any underwriting or placement agency fees, discounts, commissions and expenses, for the number of such additional shares of Common Stock (determined on a fully-diluted basis) issued or to be issued in such New Issuance (including the maximum number of shares of Common Stock into which the Common Stock Equivalents issued or to be issued in such New Issuance initially are convertible, exchangeable or exercisable) would purchase at the Current Market Price on the Relevant Date, plus (C) the number of shares of Common Stock which the aggregate amount of any additional consideration initially payable upon conversion, exchange or exercise of any Common Stock Equivalents issued or to be issued in such New Issuance would purchase at the Current Market Price on the Relevant Date.

Such adjustment shall be made whenever such shares of Common Stock or Common Stock Equivalents are issued, and shall become effective retroactively (1) in the case of any issuance to the stockholders of the Company, as such, to the date immediately following the close of business on the record date for the determination of the stockholders of the Company entitled to receive such shares of Common Stock or Common Stock Equivalents and (2) in all other cases, on the date of such issuance of such shares of Common Stock or Common Stock Equivalents; provided, however, that the determination as to whether an adjustment is required to be made pursuant to this Section 12(B) shall be made only upon the issuance of such shares of Common Stock or Common Stock Equivalents, and not upon the issuance of any security that is issued upon the conversion, exchange or exercise of such Common Stock Equivalents. Solely for purposes of this Section 12(B)(a): (y) the term “Common Stock” shall include the Common Stock and each other class of Capital Stock of the Company that does not have a preference over any other class of Capital Stock of the Company as to dividends or

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upon liquidation, dissolution or winding up of the Company and, in each case, shall include any other class of Capital Stock of the Company into which such stock is reclassified or reconstituted; and (z) if the provisions of any Common Stock Equivalents or any rights or options to purchase any shares of Common Stock or Common Stock Equivalents are amended after the date of issuance so as to reduce the applicable conversion price, exchange price or exercise price, such amendment shall be deemed to be a new issuance of such Common Stock Equivalents.

(b) Amount of Consideration. If the Company shall issue or sell any shares of Common Stock or Common Stock Equivalents or any rights or options to purchase any shares of Common Stock or Common Stock Equivalents for cash, then the consideration received therefor shall be deemed to be the amount of cash received by the Company therefor, without deduction therefrom of any expenses incurred or any underwriting commissions or concessions or discounts paid or allowed by the Company in connection therewith. If the Company shall issue or sell any shares of Common Stock or Common Stock Equivalents or any rights or options to purchase any Common Stock or Common Stock Equivalents for any consideration other than cash, then the amount of such non-cash consideration received by the Company shall be deemed to be the Fair Market Value of such non-cash consideration, without deduction therefrom of any expenses incurred or any underwriting commissions or concessions or discounts paid or allowed by the Company in connection therewith, as such Fair Market Value shall determined in good faith by a majority of the Board of Directors; provided, however, that in the case of any such issuance or sale to an Affiliate of the Company, such Fair Market Value shall be determined by a nationally recognized investment banking firm chosen by the Board of Directors with the consent of a majority of the Board of Directors.

(c) Readjustment of Warrant Share Number upon Expiration of Common Stock Equivalents. If any Common Stock Equivalents (or any portions thereof) which shall have given rise to an adjustment pursuant to this Section 12(B) shall have expired or terminated without the conversion, exchange or exercise thereof and/or if by reason of the terms of such Common Stock Equivalents there shall have been an increase or increases, with the passage of time or otherwise, in the price payable upon the conversion, exchange or exercise thereof, then the Warrant Share Number shall be readjusted (but to no greater extent than originally adjusted) in order to (a) eliminate from the computation any additional shares of Common Stock corresponding to such Common Stock Equivalents as shall have expired or terminated, (b) treat the additional shares of Common Stock, if any, actually issued or issuable pursuant to any previous conversions, exchanges or exercises of such Common Stock Equivalents as having been issued for the consideration actually received and receivable therefor and (c) treat any such Common Stock Equivalents which remain outstanding as being subject to conversion, exchange or exercise on the basis of such conversion, exchange or exercise price as shall be in effect at the time.

(d) Excluded Transactions. Notwithstanding anything to the contrary in this Warrant, the provisions of this Section 12(B) shall not apply to (a) any New Issuance for which an adjustment is made pursuant to another provision of this Section 12, (b) any New Issuance in connection with an Excluded Transaction or (c) a change in the par value of the Common Stock.

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(C) Certain Distributions. If, at any time or from time to time after the issuance of this Warrant but prior to the exercise or conversion hereof, the Company shall distribute to all holders of shares of Common Stock (including any such distribution made in connection with a merger or consolidation in which the Company is the resulting or surviving Person and shares of Common Stock are not changed or exchanged) cash, evidences of indebtedness of the Company or another issuer, securities of the Company or another issuer or other assets (excluding (a) any dividend or other distribution payable in shares of Common Stock for which adjustment is made under Section 12(A) and (b) any distribution in connection with an Excluded Transaction) or rights or warrants to subscribe for or purchase any of the foregoing, then, and in each such case, the Warrant Share Number shall be increased to a number equal to the product of (i) the Warrant Share Number immediately prior to the record date for the distribution of such cash, evidences of indebtedness, securities, other assets or rights or warrants multiplied by (ii) the quotient of:

(a) the Current Market Price immediately prior to the record date for the distribution of such cash, evidences of indebtedness, securities or other assets or rights or warrants; divided by

(b) the total (which total shall be greater than zero) of (x) the Current Market Price immediately prior to the record date for the distribution of such cash, evidences of indebtedness, securities or other assets or rights or warrants minus (y) the Fair Market Value per share of Common Stock (as determined by a nationally recognized investment banking firm chosen by the Board of Directors with the consent of a majority of the Board of Directors) of such cash, evidences of indebtedness, securities or other assets or rights or warrants.

Such adjustment shall be made whenever any such distribution is made and shall become effective retroactively to the date immediately following the close of business on the record date for the determination of stockholders of the Company entitled to receive such distribution.

(D) Other Changes. If, at any time or from time to time after the issuance of this Warrant but prior to the exercise or conversion hereof, (a) the Company shall take any action which (i) affects the Common Stock and (ii) is similar to, or has an effect similar to, any of the actions described in any of Sections 12(A), 12(B), 12(C) or 12(H) (but not including any action described in any such Section) and (b) the Board of Directors in good faith determines that it would be equitable under such circumstances to adjust the Warrant Share Number as a result of such action, then, and in each such case, the Warrant Share Number shall be adjusted in such manner and at such time as the Board of Directors in good faith determines would be equitable under such circumstances, which determination shall be evidenced in a resolution of the Board of Directors, a certified copy of which shall be mailed by the Company to the Warrantholder.

(E) No Adjustment. Notwithstanding anything herein to the contrary, no adjustment under this Section 12 shall be made to the Warrant Share Number if the Company

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receives written notice from the Warrantholder that no such adjustment is required. Notwithstanding the foregoing, if an adjustment to the Warrant Share Number in respect of the issuance or sale of a Common Stock Equivalent has been previously made, the exercise of such Common Stock Equivalent in accordance with its terms existing at the time such adjustment was made shall not result in a further adjustment. If an adjustment to the Warrant Share Number in respect of the issuance or sale of a Common Stock Equivalent was not required, the exercise of such Common stock Equivalent in accordance with its terms existing at the time of issuance shall not result in an adjustment pursuant thereto.

(F) Abandonment. If the Company (a) shall take a record of the holders of shares of Common Stock for the purpose of entitling them to receive a dividend or other distribution and (b) shall, before paying or delivering such dividend or distribution to the stockholders of the Company, legally abandon its plan to pay or deliver such dividend or distribution, then no adjustment in the Warrant Share Number shall be required by reason of the taking of such record.

(G) Certificate as to Adjustments. Upon any adjustment in the Warrant Share Number, the Company shall, within 20 days following the event requiring such adjustment, deliver to the Warrantholder a certificate, signed by the Chief Financial Officer of the Company, which (a) sets forth in reasonable detail (i) the event requiring such adjustment and (ii) the method by which such adjustment was calculated and (b) specifies the adjusted Warrant Share Number in effect following such adjustment.

(H) Spin-off; Significant Transaction.

(a) Spin-off. If, at any time after the issuance of this Warrant but prior to the exercise or conversion hereof, the Company shall spin-off another Person, then the Company (a) shall issue to the Warrantholder a new warrant to purchase, at the Exercise Price, or convert its new warrant into, the number of shares of common stock or other proprietary interest in the spin-off entity that the Warrantholder would have owned had the Warrantholder exercised or converted this Warrant immediately prior to the consummation of such spin-off and (b) shall make provision therefor in the agreement, if any, relating to such spin-off. Such new warrant shall provide for rights and obligations which shall be as nearly equivalent as may be practicable to the rights and obligations provided for in this Warrant. The provisions of this Section 12(H)(a) (and any equivalent thereof in any such new warrant) shall apply to successive transactions.

(b) Significant Transaction. If, at any time after the issuance of this Warrant but prior to the exercise or conversion hereof, any Significant Transaction shall occur, then, at least 10 days prior to the consummation of such Significant Transaction, the Company:

(i) shall execute and deliver to the Warrantholder a certificate stating that from and after the consummation of such Significant Transaction:

(x) the Warrantholder shall, upon the surrender of this Warrant to the Surviving Person in such Significant Transaction,

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have the right to receive the kind and amount of shares of stock or other securities, property or cash receivable upon the consummation of such Significant Transaction by a holder of the number of shares of Common Stock into which this Warrant could have been exercised or converted immediately prior to the consummation of such Significant Transaction; and

(y) this Warrant shall be deemed to have been cancelled; and

(ii) the Company shall make provision therefor in the agreement, if any, relating to such Significant Transaction.

(I) Notices. If, at any time or from time to time:

(a) the Company shall declare a divided or other distribution on the Common Stock;

(b) the Company shall authorize the granting to the holders of shares of Common Stock any rights or warrants to subscribe for or purchase any shares of Capital Stock or any other rights or warrants; or

(c) there shall occur a spin-off or a Significant Transaction;

then, at least 10 days prior to the applicable date specified below, the Company shall mail to the Warrantholder a notice stating: (i) the date on which a record is to be taken for the purpose of such dividend, distribution or granting of rights or warrants or, if a record is not to be taken, the date as of which the holders of Common Stock of record to be entitled to such dividend, distribution or granting of rights or warrants are to be determined; or (ii) the date on which such spin-off or Significant Transaction is expected to be consummated and the date as of which it is expected that holders of Common Stock of record shall be entitled to exchange their Common Stock for shares of stock or other securities or property or cash deliverable upon the consummation of such spin-off or Significant Transaction. Notwithstanding the foregoing, in the case of any Significant Transaction, the Company shall also deliver to the Warrantholder the certificate described in such Section 12(H)(b) to the Warrantholder at least 10 days prior to consummating such Significant Transaction.

13. No Impairment. The Company will not, by amendment of its Charter or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms to be observed or performed hereunder by the Company, but will at all times in good faith assist in the carrying out of all the provisions of this Warrant Certificate and in taking of all such action as may be necessary or appropriate in order to protect the rights of the Warrantholder.

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14. Governing Law. This Warrant Certificate and the Warrants evidenced hereby shall be governed by and construed in accordance with the laws of the State of New York applicable to contracts made and to be performed entirely within such State.

15. Binding Effect; Countersignature by Warrant Agent. This Warrant Certificate shall be binding upon any successors or assigns of the Company. This Warrant Certificate shall not be valid until an authorized signatory of the Warrant Agent (as defined below) or its agent as provided in the Warrant Agreement (as defined below) countersigns this Warrant Certificate. Such signature shall be solely for the purpose of authenticating this Warrant Certificate and shall be conclusive evidence that this Warrant Certificate has been countersigned under the Warrant Agreement.

16. Warrant Agreement; Amendments. The Warrant Agreement is hereby incorporated herein by reference and made a part hereof. Reference is hereby made to the Warrant Agreement for a statement of the respective rights, limitations of rights, duties and obligations of the Company, the Warrant Agent and the Warrantholders and beneficial owners of the Warrants. A copy of the Warrant Agreement may be obtained for inspection by the Warrantholders or beneficial owners of the Warrants upon request to the Warrant Agent at the address of the Warrant Agent (or successor warrant agent) set forth in the Warrant Agreement. The Warrant Agreement and this Warrant Certificate may be amended and the observance of any term of the Warrant Agreement or this Warrant Certificate may be waived only to the extent provided in the Warrant Agreement.

17. Jones Act Restrictions. Notwithstanding the other provisions of this Warrant Agreement, in order to facilitate the Company’s compliance with the provisions of 46 U.S.C. § 55102 and the regulations promulgated thereunder, commonly referred to as the “Jones Act,” and related Maritime Laws concerning the ownership of the Common Stock by Non-U.S. Citizens, with regard to its operation of vessels in the coastwise trade of the United States and with certain contractual obligations of the Company with the United States Government:

(A) In connection with any exercise or conversion of the Warrant, Warrantholder (or, if not the Warrantholder, the Person that the Warrantholder has designated to receive the Common Stock issuable upon exercise or conversion of the Warrants) shall advise the Company whether or not it satisfies the requirements to be a U.S. Citizen. Under its Charter, the Company may require a Warrantholder (or, if not the Warrantholder, the Person that the Warrantholder has designated to receive the Common Stock issuable upon exercise or conversion of the Warrants) to provide it with such documents and other information as it may request as reasonable proof of that the Warrantholder (or, if not the Warrantholder, such other Person that the Warrantholder has designated to receive the Common Stock issuable upon exercise or conversion of the Warrants) satisfies the requirements to be a U.S. Citizen.

(B) No Warrantholder who cannot establish to the Company’s reasonable satisfaction that it (or, if not the Warrantholder, the Person that the Warrantholder has designated to receive the Common Stock issuable upon exercise or conversion of the Warrants) is a U.S. Citizen for purposes of Jones Act compliance may exercise or convert any Warrants to the extent the receipt of the Common Stock deliverable upon exercise or conversion of the Warrants would cause such Person or any Person whose ownership position would be aggregated with that of

A-14

such Person to exceed 4.9% of the aggregate number of shares of Common Stock outstanding at such time (excluding, for purposes of this Section 17(B), shares of Common Stock issuable upon exercise or conversion of all outstanding Warrants and Notes).

(C) No Warrantholder who cannot establish to the Company’s reasonable satisfaction that it (or, if not the Warrantholder, the Person that the Warrantholder has designated to receive the stock issuable upon exercise or conversion of the Warrants) is a U.S. Citizen for purposes of Jones Act compliance may exercise or convert any Warrants to the extent the shares of Common Stock deliverable upon exercise or conversion of the Warrants would constitute Excess Shares if they were issued, which shall be determined by the Company in its sole discretion at the time of any proposed exercise or conversion of a Warrant.

(D) Any sale, transfer or other disposition of a Warrant by any Warrantholder that is a Non-U.S. Citizen to a Person who is a U.S. Citizen must be a complete transfer of such Warrantholder’s interests to such Person in the Warrant and the Common Stock issuable upon exercise or conversion thereof with no ability to direct or control such Person. The foregoing restriction shall also apply to any Person that the Warrantholder has designated to receive the Common Stock issuable upon exercise or conversion of the Warrants.

18. Notices. Unless this Warrant Certificate is a Global Warrant, any notice or communication mailed to the Warrantholder shall be mailed to the Warrantholder at the Warrantholder’s address as it appears in the Registry and shall be sufficiently given if so mailed within the time prescribed. Any notice to holders of a beneficial interest in a Global Warrant shall be distributed through the Depositary in accordance with the procedures of the Depositary. Communications to such holders shall be deemed to be effective at the time of dispatch to the Depositary.

[Remainder of page intentionally left blank]

A-15

IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to be duly executed by a duly authorized officer. This Warrant Certificate shall not be valid or obligatory for any purpose until it shall have been countersigned by the Warrant Agent.

Dated:                     

HORIZON LINES, INC.
By:
	Name:
	Title:

Countersigned:
THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as Warrant Agent
By:
	Authorized Signatory

Schedule A to Global Warrant

The initial number of Warrants represented by the Global Warrant is                     .

The following decreases in the number of Warrants represented by this Global Warrant have been made as a result of the exercise of certain Warrants represented by this Global Warrant:

Date of Exercise
of Warrants Number of
Warrants Exercised Total Number of Warrants Represented Hereby Following Such Exercise Notation Made
by Warrant Agent

Form of Notice of Exercise

(to be executed only upon exercise of Warrants)

Date:                     

TO: Horizon Lines, Inc. (the “Company”)

RE: Election to Purchase Common Stock

The undersigned registered holder of [                    ] Warrants irrevocably elects to exercise the number of Warrants set forth below represented by the Global Warrant (or, in the case of a Definitive Warrant, the Warrant Certificate enclosed herewith), and surrenders all right, title and interest in the number of Warrants exercised hereby to the Company, and directs that the shares of Common Stock or other securities or property delivered upon exercise of such Warrants, and any interests in the Global Warrant or Definitive Warrant representing unexercised Warrants, be registered or placed in the name and at the address specified below and delivered thereto.

Number of Warrants                                                                                  

¨ Check if Warrantholder elects to exercise its Conversion Right in lieu of the payment of the aggregate Exercise Price pursuant to the terms and conditions set forth in the Warrants.

¨ Check if Warrantholder believes it satisfies the requirements to be a U.S. Citizen (additional information may be required by Company to confirm that Warrantholder is a U.S. Citizen).

¨ Check if Warrantholder believes it is a Non-U.S. Citizen.

Warrantholder:

By:

Name:

Title:

Signature guaranteed by (if a guarantee is required):

Securities to be issued to:

If in book-entry form through the Depositary:

Depositary Account Number:

Name of Agent Member:

If in definitive form:

Social Security Number or Other Identifying Number:

Name:

Street Address:

City, State and Zip Code:

Any unexercised Warrants evidenced by the exercising Warrantholder’s interest in the Global Warrant or Definitive Warrant, as the case may be, to be issued to:

If in book-entry form through the Depositary:

Depositary Account Number:

Name of Agent Member:

If in definitive form:

Social Security Number or Other Identifying Number:

Name:

Street Address:

City, State and Zip Code:

Form of Assignment

For value received, the undersigned registered Warrantholder of the within Warrant Certificate hereby sells, assigns and transfers unto the Assignee(s) named below (including the undersigned with respect to any Warrants constituting a part of the Warrants evidenced by the within Warrant Certificate not being assigned hereby) all of the right, title and interest of the undersigned under the within Warrant Certificate with respect to the number of Warrants set forth below.

Name of Assignees Address Number of Warrants Social Security Number or other Identifying Number

and does irrevocably constitute and appoint [                    ], the undersigned’s attorney, to make such transfer on the books of the Company maintained for the purpose, with full power of substitution in the premises.

Dated:

Warrantholder:

By:

Name:

Title:

Signature guaranteed by (if a guarantee is required):

EX-10.1

Exhibit 10.1

EXECUTION VERSION

HORIZON LINES, LLC

11.00% FIRST LIEN SENIOR SECURED NOTES DUE 2016

PURCHASE AGREEMENT

October 5, 2011

The Purchaser named on the signature page hereto

Located at the address specified on the signature page hereto

Ladies and Gentlemen:

Horizon Lines, LLC, a Delaware limited liability company (the “Company”) proposes, upon the terms and conditions set forth in this agreement (this “Agreement”), to issue and sell to the purchaser named herein (the “Purchaser”), the aggregate principal amount of its 11.00% First Lien Senior Secured Notes due 2016 (the “First Lien Notes”) that is indicated on the signature page of the Purchaser hereto. The First Lien Notes (i) are to be issued pursuant to an Indenture (the “Indenture”), to be dated of even date herewith and entered into among the Company, the Guarantors (as defined below) party thereto and U.S. Bank National Association, a national banking association, as trustee and collateral agent (in such capacity, the “Trustee”). The Company’s obligations under the First Lien Notes, including the due and punctual payment of interest on the First Lien Notes, will be irrevocably and unconditionally guaranteed (the “Note Guarantees”) by Horizon Lines, Inc., a Delaware corporation (the “Parent”) and the Restricted Subsidiaries of the Parent who will agree to be guarantors under the Indenture (together, with the Parent, the “Guarantors”), pursuant to a Notation of Guarantee, each to be dated of even date herewith, by the Guarantors (the “Notation of Guarantee”). As used herein, the term “First Lien Notes” shall include the Note Guarantees, unless the context otherwise requires. This Agreement is to confirm the agreement concerning the purchase of the First Lien Notes from the Company by the Purchaser. The obligations of the Company and the Guarantors under the Indenture and the First Lien Notes will be governed by a Pledge and Security Agreement among the Company, the Guarantors and the Trustee, of even date herewith (the “Security Agreement”). The First Lien Notes will be subject to a Registration Rights Agreement (the “Registration Rights Agreement”) among the Company, the Guarantors and the Purchasers of the First Lien Notes, of even date herewith.

Concurrently with the issuance of the First Lien Notes, (i) the Company will be issuing $100.0 million of Second Lien Senior Secured Notes due 2016 (the “Second Lien Notes”), which will be guaranteed by the Guarantors; (ii) the Company and the Guarantors will also enter into a new $100.0 million asset-based revolving loan facility (the “New ABL Facility”); and (iii) the Parent will be completing its offer (the “Exchange Offer”) to exchange (1) up to $180.0 million aggregate principal amount of 6.00% Series A Convertible Senior Secured Notes due 2017 (the “Series A Convertible Notes”), (2) up to $100.0 million aggregate principal amount of 6.00% Series B Mandatorily Convertible Senior Secured Notes (the “Series B Convertible

Notes”, and, together with the Series A Convertible Notes, the “New Convertible Notes”) and (3) up to $50.0 million of cash for any and all of the Parent’s outstanding 4.25% Convertible Senior Notes due 2012 (the “Existing Convertible Notes”).

Collectively, the following are referred to herein as the “Transaction Documents”: (i) this Agreement and the other purchase agreements relating to the issuance and sale of the First Lien Notes (collectively, the “First Lien NPAs”), (ii) the Indenture, (iii) the First Lien Notes and the associated Note Guarantees, (iv) the Registration Rights Agreement, (v) the Security Agreement, (vi) the purchase agreements relating to the issuance and sale of the Second Lien Notes (collectively, the “Second Lien NPAs”), (vii) the indenture governing the Second Lien Notes, (viii) the Second Lien Notes and the associated guarantees, (ix) the registration rights agreement relating to the Second Lien Notes, (x) the pledge and security agreement relating to the Second Lien Notes, (xi) the indenture governing the New Convertible Notes, (xii) the New Convertible Notes and the associated guarantees, (xiii) the registration rights agreement relating to the New Convertible Notes, (xiv) the common stock of Parent, par value $0.01 per share (the “Common Stock”) to be issued in the Exchange Offer, (xv) the warrants to be issued in the Exchange Offer and upon conversion of the New Convertible Notes (the “Warrants’), (xvi) the warrant agreement governing the Warrants between the Parent and the warrant agent thereunder, (xvii) the pledge and security agreement relating to the New Convertible Notes, (xviii) the agreement governing the New ABL Facility and all guarantee, pledge and security agreements associated therewith and (xix) the intercreditor agreement among the Company, the Guarantors, the agent under the New ABL Facility, the Trustee (as collateral agent with respect to the First Lien Notes), the collateral agent with respect to the Second Lien Notes and the collateral agent with respect to the Convertible Notes (the “Intercreditor Agreement”), in each case, of even date herewith. Collectively, the transactions contemplated by the Transaction Documents (including, without limitation, the use of proceeds therefrom) and the Exchange Offer are referred to herein as the “Transactions”. Collectively, items (iv), (ix) and (xiii) are referred to herein as the “Registration Rights Agreements”.

1. Purchase of the First Lien Notes. The Company and the Guarantors, jointly and severally hereby agree, on the basis of the representations, warranties, covenants and agreements of the Purchaser contained herein and subject to all the terms and conditions set forth herein, to issue and sell to the Purchaser and, upon the basis of the representations, warranties and agreements of the Company and the Guarantors herein contained and subject to all the terms and conditions set forth herein, the Purchaser agrees, to purchase from the Company the aggregate principal amount of First Lien Notes that is indicated on the signature page hereto for a price in cash equal to the amount of cash indicated on the Company’s and the Guarantors’ signature page hereto, which is equal to 100.000% of the aggregate principal amount of such First Lien Notes.

2. Payment for and Delivery of the First Lien Notes. Subject to the satisfaction or waiver of the conditions set forth in Section 6 below, the closing (the “Closing”) of the purchase and sale of the First Lien Notes shall occur at 9:00 a.m., New York City time, on the date hereof. The Closing will be held at the offices of Paul, Weiss, Rifkind, Wharton & Garrison LLP, New York, New York, or at such other location as the Company and the Purchaser may otherwise agree. The date hereof is referred to herein as the “Closing Date.”

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The First Lien Notes will be delivered to the Purchaser, or the Trustee as custodian for The Depository Trust Company (“DTC”), against payment by or on behalf of the Purchaser of the purchase price therefor by wire transfer in immediately available funds, by causing DTC to credit the First Lien Notes to the account of the Purchaser at DTC designated in Annex 1 hereto. The First Lien Notes will be evidenced by one or more global securities in definitive form and will be registered in the name of Cede & Co. as nominee of DTC.

3. Representations, Warranties and Agreements of the Company and the Guarantors. Each of the Company and the Guarantors, jointly and severally, represent, warrant and agree, on and as of the date hereof, as follows:

(a) The Registration Statement of the Parent on Form S-4, relating to the Exchange Offer, as filed with the Securities and Exchange Commission (the “Commission”) on August 26, 2011, as amended on September 19, 2011, September 22, 2011, September 26, 2011 and September 29, 2011 (as so amended, the “Registration Statement”), together with the form of Indenture attached hereto as Exhibit I, the form of Security Agreement attached hereto as Exhibit II, the form of Intercreditor Agreement attached hereto as Exhibit III and the form of Registration Rights Agreement attached hereto as Exhibit IV hereto, (collectively, the “Disclosure Package”), contains all the information specified in, and meeting the requirements of, Rule 144A(d)(4) under the Securities Act of 1933 (the “Securities Act”). The Registration Statement was declared effective by the Commission on October 3, 2011.

(b) The First Lien Notes and Note Guarantees are not of the same class (within the meaning of Rule 144A under the Securities Act) as securities of the Company or the Guarantors that are listed on a national securities exchange registered under Section 6 of the Exchange Act or that are quoted in a United States automated inter-dealer quotation system.

(c) None of the Company or the Guarantors is, and after giving effect to the Transactions, as described under “Unaudited Pro Forma Condensed Combined Financial Information” in the Disclosure Package, will be, an “investment company” or a company “controlled” by an “investment company” within the meaning of the Investment Company Act and the rules and regulations of the Commission thereunder.

(d) The offer and sale of the First Lien Notes pursuant hereto is exempt from the registration requirements of the Securities Act. No form of general solicitation or general advertising within the meaning of Regulation D under the Securities Act (including, but not limited to, advertisements, articles, notices or other communications published in any newspaper, magazine or similar medium or broadcast over television or radio, or any seminar or meeting whose attendees have been invited by any general solicitation or general advertising) was used by the Company or the Guarantors, any of their respective Affiliates or any of their representatives in connection with the offer and sale of the First Lien Notes.

(e) No directed selling efforts within the meaning of Rule 902 under the Securities Act were used by the Company, the Guarantors or any of their respective representatives with respect to First Lien Notes sold outside the United States to non-U.S. persons, and the Company and the Guarantors and any of their respective Affiliates and any person acting on their behalf has complied with and will implement the “offering restrictions” required by Rule 902 under the Securities Act.

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(f) The Disclosure Package has been prepared by the Company, the Parent and the other Guarantors for use in connection with the issuance of the First Lien Notes. No other materials have been prepared by the Company, the Parent or the other Guarantors for use in connection with the issuance of the First Lien Notes. No order or decree preventing the use of the Disclosure Package, or any order asserting that the Transactions are subject to the registration requirements of the Securities Act has been issued, and no proceeding for that purpose has commenced or is pending or, to the knowledge of the Company or the Guarantors, is contemplated.

(g) As of the date hereof, the Disclosure Package does not contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading.

(h) The statistical and market-related data included in the Disclosure Package are based on or derived from sources that the Company and the Guarantors believe to be reliable in all material respects.

(i) Each of the Company and the Guarantors and their respective subsidiaries has been duly organized, is validly existing and in good standing as a limited liability company or corporation, as applicable, under the laws of its jurisdiction of organization and is duly qualified to do business and in good standing as a limited liability company or corporation, as applicable, in each jurisdiction in which its ownership or lease of property or the conduct of its businesses requires such qualification, except where the failure to be so qualified or in good standing would not, in the aggregate, reasonably be expected to have (i) a material adverse effect on the condition (financial or otherwise), results of operations, stockholders’ equity, properties, business or prospects of the Company and the Guarantors, taken as a whole or (ii) a material adverse effect on the performance by the Company and the Guarantors of this Agreement or any of the Transaction Documents (as defined below) or the consummation of any of the transactions contemplated hereby or thereby (the events described in clauses (i) and (ii), collectively, a “Purchase Agreement Material Adverse Effect”); each of the Company, the Guarantors and their respective subsidiaries has all power and authority necessary to own or hold its properties and to conduct the businesses in which it is engaged. The Company and the Guarantors do not own or control, directly or indirectly, any corporation, association or other entity other than the subsidiaries listed on Exhibit V hereto. None of the subsidiaries of the Company or any of the Guarantors (other than as identified as such in Exhibit V) is a “significant subsidiary” (as defined in Rule 405 under the Securities Act).

(j) The Parent has the authorized capitalization as set forth in the Disclosure Package, and all of the issued and outstanding shares of capital stock of the Parent have been duly authorized and validly issued and are fully paid and non-assessable.

(k) All of the issued and outstanding equity interests of the Company are directly or indirectly owned by Horizon Lines Holding Corp. and have been duly authorized

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and validly issued, are fully paid and non-assessable and are owned of record by one or more of the Other Guarantors, free and clear of all Liens other than those imposed in connection with the Transactions. All of the issued and outstanding shares of capital stock or equity interests (as the case may be) of Hawaii Stevedores, Inc., Horizon Lines Holding Corp., Horizon Lines of Puerto Rico, Inc., Horizon Lines of Alaska, LLC, Horizon Lines of Guam, LLC, Horizon Lines Vessels, LLC, H-L Distribution Service, LLC, Horizon Logistics, LLC, Aero Logistics, LLC, Sea-Logix, LLC and Horizon Services Group, LLC (together, the “Other Guarantors”), have been duly authorized and validly issued, are fully paid and non-assessable and are owned of record by one or more of the Other Guarantors, free and clear of all Liens other than those imposed in connection with the Transactions.

(l) Each of the Company and the Guarantors has all requisite limited liability company or corporate power, as applicable, and authority to execute, deliver and perform its obligations under the Indenture. The Indenture has been duly and validly authorized by each of the Company and the Guarantors and upon its execution and delivery and constitutes the valid and binding agreement of each of the Company and the Guarantors, enforceable against it in accordance with its terms, except as such enforceability may be limited by bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium, and other laws relating to or affecting creditors’ rights generally and by general equitable principles (regardless of whether such enforceability is considered in a proceeding in equity or at law). No qualification of the Indenture under the Trust Indenture Act of 1939 (the “Trust Indenture Act”) is required in connection with the offer and sale of the First Lien Notes in the manner contemplated hereby.

(m) The Company has all requisite limited liability company power and authority to execute, issue, sell and perform its obligations under the First Lien Notes. The First Lien Notes have been duly authorized by the Company and, when duly executed by the Company in accordance with the terms of the Indenture, assuming due authentication of the First Lien Notes by the Trustee, upon delivery to the Purchaser against payment therefor in accordance with the terms hereof, will be validly issued and delivered and will constitute valid and binding obligations of the Company entitled to the benefits of the Indenture, enforceable against the Company in accordance with their terms, except as such enforceability may be limited by bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium, and other laws relating to or affecting creditors’ rights generally and by general equitable principles (regardless of whether such enforceability is considered in a proceeding in equity or at law).

(n) Each of the Company and the Guarantors has all requisite limited liability company or corporate power, as applicable, and authority to execute, deliver and perform its obligations under the Security Agreement. The Security Agreement has been duly and validly authorized by each of the Company and the Guarantors and upon its execution and delivery and constitutes the valid and binding agreement of each of the Company and the Guarantors, enforceable against it in accordance with its terms, except as such enforceability may be limited by bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium, and other laws relating to or affecting creditors’ rights generally and by general equitable principles (regardless of whether such enforceability is considered in a proceeding in equity or at law).

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(o) Each of the Company and the Guarantors has all requisite limited liability company or corporate power, as applicable, and authority to execute, deliver and perform its obligations under the Intercreditor Agreement. The Intercreditor Agreement has been duly and validly authorized by each of the Company and the Guarantors and upon its execution and delivery and constitutes the valid and binding agreement of each of the Company and the Guarantors, enforceable against it in accordance with its terms, except as such enforceability may be limited by bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium, and other laws relating to or affecting creditors’ rights generally and by general equitable principles (regardless of whether such enforceability is considered in a proceeding in equity or at law).

(p) Each of the Company and the Guarantors has all requisite limited liability company or corporate power, as applicable, and authority to execute, deliver and perform its obligations under the Registration Rights Agreement. The Registration Rights Agreement has been duly and validly authorized by each of the Company and the Guarantors and upon its execution and delivery and constitutes the valid and binding agreement of each of the Company and the Guarantors, enforceable against it in accordance with its terms, except (i) as such enforceability may be limited by bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium, and other laws relating to or affecting creditors’ rights generally and by general equitable principles (regardless of whether such enforceability is considered in a proceeding in equity or at law) and (ii) as any indemnification provisions contained therein relating to securities law liabilities may be unenforceable.

(q) Each of the Guarantors has all requisite corporate or limited liability company power and authority, as applicable, to execute, issue, sell and perform its obligations under the Note Guarantees and the related Notation of Guarantee. The Note Guarantees and Notations of Guarantee have been duly authorized by the Guarantors and, when duly executed by the Guarantors in accordance with the terms of the Indenture will constitute valid and binding obligations of each of the Guarantors entitled to the benefits of the Indenture, enforceable against each of the Guarantors in accordance with their terms, except as such enforceability may be limited by bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium, and other laws relating to or affecting creditors’ rights generally and by general equitable principles (regardless of whether such enforceability is considered in a proceeding in equity or at law).

(r) Each of the Company, the Guarantors and their respective subsidiaries, as applicable, has all requisite limited liability or corporate power and authority, as applicable, to execute, deliver and perform its obligations under each Transaction Document (other than the First Lien NPAs, the Indenture, the First Lien Notes, the Note Guarantees, the Notations of Guarantee, the Security Agreement, the Intercreditor Agreement, the Registration Rights Agreement and the Second Lien NPAs) to which it is a party. Each such Transaction Document has been duly and validly authorized by each of the Company and the Guarantors (to the extent a party thereto), and will be validly executed and delivered and (assuming the due authorization, execution and delivery thereof by any other parties thereto other than the Company and the Guarantors) will constitute the valid and binding obligation of each of the Company and the Guarantors (to the extent a party thereto), in accordance with the terms thereof, enforceable against it in accordance with its terms, except (i) as such enforceability

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may be limited by bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium and other similar laws relating to or affecting creditors’ rights generally, by general equitable principles (regardless of whether such enforceability is considered in a proceeding in equity or at law) and, as to rights of indemnification and contribution with respect to liabilities under securities laws, by principles of public policy and (ii) as any indemnification provisions contained therein relating to securities law liabilities may be unenforceable. To the extent described in the Disclosure Package, each Transaction Document conforms in all material respects to the description thereof in the Disclosure Package.

(s) Each of the Company and each of the Guarantors has all requisite limited liability or corporate power and authority, as applicable, to execute, deliver and perform its obligations under this Agreement, the other First Lien NPAs and the Second Lien NPAs. This Agreement, the other First Lien NPAs and the Second Lien NPAs have been duly and validly authorized, executed and delivered by the Company and each of the Guarantors.

(t) The Transactions will not (i) conflict with or result in a breach or violation of any of the terms or provisions of, impose any lien, charge or encumbrance upon any property or assets of the Company, the Guarantors or their respective subsidiaries, or constitute a default under, any indenture, mortgage, deed of trust, loan agreement, license, lease or other agreement or instrument to which the Company, the Guarantors or any of their respective subsidiaries is a party or by which the Company, the Guarantors or any of their respective subsidiaries is bound or to which any of the property or assets of the Company, the Guarantors or any of their respective subsidiaries is subject, except for Liens created by the Transaction Documents, (ii) result in any violation of the provisions of the certificate of formation, limited liability company agreement, charter or by-laws (or similar organizational documents) of any of the Company, the Guarantors or any of their respective subsidiaries or (iii) result in any violation of any statute or any judgment, order, decree, rule or regulation of any court or governmental agency or body having jurisdiction over any of the Company, the Guarantors or any of their respective subsidiaries or any of their properties or assets, except, with respect to clauses (i) and (iii) above, where any such matters would not, individually or in the aggregate, have a Purchase Agreement Material Adverse Effect.

(u) No consent, approval, authorization or order of, or filing, registration or qualification with any court or governmental agency or body having jurisdiction over any of the Company, the Guarantors or any of their respective subsidiaries and properties or assets is required for the execution, delivery and performance by the Company and the Guarantors, to the extent a party thereto, of the Transaction Documents or the completion of the Transactions, except in connection with the registration process contemplated by the Registration Rights Agreements.

(v) Other than pursuant to the Registration Statement and other than the Registration Rights Agreements, there are no contracts, agreements or understandings between any of the Company and the Guarantors and any person, granting such person the right to require the Company or the Guarantors to file a registration statement under the Securities Act with respect to any securities of the Company or the Guarantors owned or to be owned by such person.

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(w) None of the Company, the Guarantors nor any other person acting on behalf of the Company or the Guarantors has sold or issued any securities that would be integrated with the offering of the First Lien Notes contemplated by this Agreement pursuant to the Securities Act, the rules and regulations thereunder or the interpretations thereof by the Commission. The Company and the Guarantors will take reasonable precautions designed to insure that any offer or sale, direct or indirect, in the United States or to any U.S. person (as defined in Rule 902 under the Securities Act), of any First Lien Notes or any substantially similar security issued by the Company or the Guarantors, within six months subsequent to the date hereof, is made under restrictions and other circumstances reasonably designed not to affect the status of the offer and sale of the First Lien Notes in the United States and to U.S. persons contemplated by this Agreement as transactions exempt from the registration provisions of the Securities Act, including any sales pursuant to Rule 144A under, or Regulation S of, the Securities Act.

(x) Since the date of the latest audited financial statements of the Parent included in the Disclosure Package and except as disclosed in the Disclosure Package, none of the Company, the Guarantors or any of their respective subsidiaries has (i) sustained any loss or interference with its business from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor disturbance or dispute or court or governmental action, order or decree, (ii) issued or granted any securities, (iii) incurred any liability or obligation, direct or contingent, other than liabilities and obligations that were incurred in the ordinary course of business, that is material to the Company and its subsidiaries, taken as a whole, (iv) entered into any transaction not in the ordinary course of business, that is material to the Company and its subsidiaries, taken as a whole, (v) declared or paid any dividend on its capital stock, and (vi) since such date, there has not been any change in the capital stock or limited liability interests, as applicable, or long-term debt of any of the Company, the Guarantors or any of their respective subsidiaries or any adverse change, or any development involving a prospective adverse change, in or affecting the condition (financial or otherwise), results of operations, stockholders’ equity or limited liability company interests, as applicable, properties, management, business or prospects of any of the Company, the Guarantors or their respective subsidiaries, in each case except as would not, in the aggregate, reasonably be expected to have a Purchase Agreement Material Adverse Effect and except, in the case of clauses (ii), (iii), (iv) and (vi), pursuant to the Transactions.

(y) Except as disclosed in the Disclosure Package, there are no judicial, administrative, legal or governmental proceedings (including any notice of violation or alleged violation) pending to which any of the Company, the Guarantors or any of their respective subsidiaries is a party or of which any property or assets of the Company, the Guarantors or any of their respective subsidiaries is the subject that would, in the aggregate, reasonably be expected to have a Purchase Agreement Material Adverse Effect. To the Company’s and the Guarantors’ knowledge, no such proceedings are threatened or contemplated by governmental authorities or others.

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(z) Except as would not reasonably be expected to have a Purchase Agreement Material Adverse Effect:

(i) The facilities and properties owned, leased or operated by the Company and the Guarantors or any of their subsidiaries (the “Properties”) do not contain any gasoline or petroleum (including crude oil or any fraction thereof) or petroleum products or any hazardous or toxic substances, materials or wastes, defined or regulated as such in or under any Environmental Law (as defined below), including, without limitation, asbestos, perchlorate, polychlorinated biphenyls and urea-formaldehyde insulation (“Materials of Environmental Concern”) in amounts or concentrations which (i) constitute a violation of, or (ii) could reasonably be expected to give rise to liability on behalf of any of the Company or the Guarantors under, any and all applicable foreign, federal, state, local or municipal laws, rules, orders, regulations, statutes, ordinances, codes, decrees, requirements of the government of the United States of America or any other nation, or of any political subdivision thereof, whether state or local (including common law) regulating, relating to or imposing liability or standards of conduct concerning protection of (i) human health from exposure to any Materials of Environmental Concern or (ii) the environment, as now or may at any time be in effect during the term of this Agreement (“Environmental Law”);

(ii) The Properties, including any vessel owned, bareboat chartered or operated by the Company or the Guarantors and their respective subsidiaries other than Vessels owned by an entity other than the Company and the Guarantors and which are managed under Vessel management agreements, (the “Vessels”), and all operations of the Company and the Guarantors and/or their respective subsidiaries at the Properties or respecting the Vessels are in compliance, and have in the last five years been in compliance, with all applicable Environmental Laws, and there is no contamination at, under or about the Properties or violation of any Environmental Law with respect to the Properties, including the Vessels, or the business operated by the Company, the Guarantors or any of their subsidiaries (the “Business”);

(iii) Materials of Environmental Concern have not been transported or disposed of from the Properties, including the Vessels, in violation of, or in a manner or to a location that could reasonably be expected to give rise to liability on behalf of the Company or the Guarantors under any Environmental Law, and no Materials of Environmental Concern have been generated, treated, stored or disposed of at, on or under any of the Properties or from the Vessels in violation of, or in a manner that could reasonably be expected to give rise to liability on behalf of the Company or the Guarantors under, any applicable Environmental Law; and

(iv) there has been no release or threat of release of Materials of Environmental Concern at or from the Properties, including the Vessels, or arising from or related to the operations of the Company or the Guarantors or any Subsidiary in connection with the Properties, including the Vessels, or otherwise in connection with the Business, in violation of or in amounts or in a manner that could reasonably be expected to give rise to liability on behalf of the Company or the Guarantors under Environmental Laws.

(aa) (i) Each “employee benefit plan” (within the meaning of Section 3(3) of the Employee Retirement Security Act of 1974, as amended (“ERISA”) and whether or not subject to ERISA) that is or, in the past six years has been maintained, administered or contributed to, or has had any obligation to contribute to, by any of the Company, the Guarantors or any member of the respective Controlled Group (each a “Plan”), has been maintained in compliance with its terms and with the requirements of all applicable statutes,

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rules and regulations including ERISA and the Code; (ii) no prohibited transaction, within the meaning of Section 406 of ERISA or Section 4975 of the Code, has occurred with respect to any Plan excluding transactions effected pursuant to a statutory or administrative exemption; (iii) no Plan is or was subject to Title IV of ERISA or is or was a Multiemployer Plan; (iv) each Plan that is intended to be qualified under Section 401(a) of the Code is so qualified and nothing has occurred, whether by action or by failure to act, which would cause the loss of such qualification; and (v) none of the Company or the Guarantors or a member of a Controlled Group under any of them has any material liability with regards to any post-retirement welfare benefit under a Plan other than as required by Part 6 of Subtitle B of Title I of ERISA or similar required continuation of coverage law.

(bb) The Parent. and each of its subsidiaries maintains a system of internal control over financial reporting (as such term is defined in Rule 13a-15(f) of the Exchange Act) that complies with the requirements of the Exchange Act and that has been designed by, or under the supervision of, the Parent’s principal executive and principal financial officers, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles in the United States. The Parent, and each of its subsidiaries maintains internal accounting controls sufficient to provide reasonable assurances regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles in the United States, including, but not limited to, internal accounting controls sufficient to provide reasonable assurance that (i) transactions are executed in accordance with management’s general or specific authorization, (ii) transactions are recorded as necessary to permit preparation of the relevant entity’s financial statements in conformity with accounting principles generally accepted in the United States and to maintain accountability for its assets, (iii) access to the relevant entity’s assets is permitted only in accordance with management’s general or specific authorization, and (iv) the recorded accountability for the relevant entity’s assets is compared with existing assets at reasonable intervals and appropriate action is taken with respect to any differences. As of the date of the most recent consolidated balance sheet of the Parent, reviewed or audited by Ernst & Young LLP, there were no material weaknesses in any of the Parent’s or its subsidiaries’ internal control over financial reporting.

(cc) After giving effect to the Transactions (including, without limitation, the retirement of existing indebtedness and the related agreements contemplated thereby), none of the Company, the Guarantors or any of their respective subsidiaries (i) is in violation of its certificate of formation, limited liability company agreement, charter or by-laws (or similar organizational documents), (ii) is in default, and no event has occurred that, with notice or lapse of time or both, would constitute such a default, in the due performance or observance of any term, covenant, condition or other obligation contained in any indenture, mortgage, deed of trust, loan agreement, license or other agreement or instrument to which it is a party or by which it is bound or to which any of its properties or assets is subject, or (iii) is in violation of any statute or any order, rule or regulation of any court or governmental agency or body having jurisdiction over it or its property or assets or has failed to obtain any license, permit, certificate, franchise or other governmental authorization or permit necessary to the ownership of its property or to the conduct of its business, except in the case of clauses (ii) and (iii), to the extent any such conflict, breach, violation, failure or default would not, individually or in the aggregate, have a Purchase Agreement Material Adverse Effect.

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(dd) None of the Parent, the Company, the other Guarantors or any of their respective subsidiaries, nor, to the knowledge of the Parent, the Company or the other Guarantors, any director, officer, manager, member, agent, employee or other person associated with or acting on behalf of the Parent, the Company, the other Guarantors or any of their respective subsidiaries, has (i) used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expense relating to political activity; (ii) made any direct or indirect unlawful payment to any foreign or domestic government official or employee from corporate funds; (iii) violated or is in violation of any provision of the Foreign Corrupt Practices Act of 1977; or (iv) made any bribe, rebate, payoff, influence payment, kickback or other unlawful payment.

(ee) None of the Transactions will violate or result in a violation of Regulations T, U and X of the Board of Governors of the Federal Reserve System.

(ff) The Parent, the Company and the other Guarantors and their respective Affiliates have not taken, directly or indirectly, any action designed to or that has constituted or that would reasonably be expected to cause or result in the stabilization or manipulation of the price of the First Lien Notes, the Second Lien Notes, the New Convertible Notes, the Existing Convertible Notes or the common stock of the Parent.

(gg) (i) The Parent and its subsidiaries maintains “disclosure controls and procedures” (as such term is defined in Rule 13a-15(e) under the Exchange Act), (ii) such disclosure controls and procedures are designed to ensure that the information required to be disclosed by the Parent and its subsidiaries in the reports they file or submit under the Exchange Act is accumulated and communicated to management of the Parent and its subsidiaries, including their respective principal executive officers and principal financial officers, as appropriate, to allow timely decisions regarding required disclosure to be made; and (iii) such disclosure controls and procedures are effective in all material respects to perform the functions for which they were established.

(hh) Except as disclosed in the Disclosure Package, since the date of the most recent balance sheet of the Company and the Parent and their respective consolidated subsidiaries included in the Disclosure Package, (i) the Company and the Parent have not been advised of or become aware of (A) any significant deficiencies in the design or operation of internal control over financial reporting, that could adversely affect the ability of the Company, the Parent or any of their respective subsidiaries to record, process, summarize and report financial data, or any material weaknesses in internal control over financial reporting, and (B) any fraud, whether or not material, that involves management or other employees who have a significant role in the internal control over financial reporting of any of the Company, the Parent and each of their respective subsidiaries; and (ii) there have been no significant changes in internal control over financial reporting or in other factors that could significantly affect internal control over financial reporting, including any corrective actions with regard to significant deficiencies and material weaknesses.

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(ii) After giving effect to the Transactions (including, without limitation, the retirement of existing indebtedness and the related agreements contemplated thereby), the Company and each Guarantor owns and has good title to its “Collateral” (as defined in Exhibit I hereto), free and clear of all “Liens” (as defined in Exhibit I hereto) other than “Permitted Liens” (as defined in Exhibit I hereto). The Liens granted under the Indenture and the Security Agreement (the “First Lien Note Liens”) will constitute valid and continuing Liens on the Collateral in favor of the Trustee on behalf of and for the benefit of the holders of the First Lien Notes, which Liens on the Collateral (1) will have been perfected (as described in, and subject to any exceptions to be set forth in the Disclosure Package) (2) will have the priority set forth in the Disclosure Package, and (3) will be enforceable as such as against creditors of and purchasers from the Company and each Guarantor in accordance with its terms, except as such enforceability may be limited by bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium, and other laws relating to or affecting creditors’ rights generally and by general equitable principles (regardless of whether such enforceability is considered in a proceeding in equity or at law). The Company and the Guarantors will have received all consents and approvals required by the terms of the Security Agreement to the pledge of the Collateral to the Trustee under the Indenture and under the Security Agreement. As of the Closing Date, all action necessary to perfect the First Lien Note Liens will have been duly taken.

(jj) After giving effect to the Transactions (including, without limitation, the retirement of existing indebtedness and the related agreements contemplated thereby), other than Liens granted pursuant to the Transaction Documents and Permitted Liens, none of the Company or the Guarantors have pledged, assigned, sold or granted a security interest in the Collateral. All actions necessary (including the filing of UCC-1 financing statements and filings with the United States Patent and Trademark Office, the United States Copyright Office or any applicable foreign intellectual property office or agency) to protect and evidence the Trustee’s Liens in the Collateral will have been duly and effectively taken by the Company and the Guarantors (as described in, and subject to any exceptions to be set forth in the Security Agreement). After giving effect to the Transactions (including, without limitation, the retirement of existing indebtedness and the related agreements contemplated thereby), no security agreement, financing statement, equivalent security or Lien instrument or continuation statement authorized by the Company or any Guarantor and listing the Company or any Guarantor as debtor covering all or any part of the Collateral shall be on file or of record in any jurisdiction, except in respect of Permitted Liens or such as may have been filed, recorded or made as contemplated by the Transaction Documents.

(kk) The historical financial statements (including the related notes and supporting schedules) included in Disclosure Package present fairly in all material respects the financial condition, results of operations and cash flows of the entities purported to be shown thereby, at the dates and for the periods indicated, and have been prepared in conformity with accounting principles generally accepted in the United States applied on a consistent basis throughout the periods involved.

(ll) The pro forma financial statements included in the Disclosure Package include assumptions that provide a reasonable basis for presenting the significant effects directly attributable to the Transactions, and the related pro forma adjustments give appropriate

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effect to those assumptions. The pro forma financial statements included in the Disclosure Package have been prepared in accordance with the Commission’s rules and guidance with respect to pro forma financial information. The pro forma financial statements set forth in the Disclosure Package have been prepared on the basis consistent with such historical financial statements, include all material adjustments to the historical financial data required by Rule 11-02 of Regulation S-X to reflect the Transactions, and give effect to assumptions made on a reasonable basis and in good faith present fairly in all material respects the Transactions.

(mm) No labor disturbance by or dispute with the employees of the Parent or any of its subsidiaries exists or, to the knowledge of the Parent or such subsidiaries, is imminent that would reasonably be expected to have a Purchase Agreement Material Adverse Effect.

(nn) Except as disclosed in the Disclosure Package, there is and has been no material failure on the part of the Company or the Guarantors, to the extent applicable, or any of the Company’s or the Guarantors’ directors or officers, in their capacities as such, to comply with any provision of the Sarbanes-Oxley Act of 2002 and the rules and regulations promulgated in connection therewith.

(oo) The operations of the Company, the Guarantors and their respective subsidiaries are and have been conducted at all times in compliance with applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, the money laundering statutes of all jurisdictions, the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any governmental agency (collectively, the “Money Laundering Laws”) and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company, the Guarantors or any of their respective subsidiaries with respect to the Money Laundering Laws is pending or, to the knowledge of the Company or the Guarantors, threatened.

(pp) None of the Company, the Guarantors or any of their respective subsidiaries nor, to the knowledge of any of the Company or the Guarantors, any director, officer, manager, member, agent, employee or affiliate of any of the Company, the Guarantors or any of their respective subsidiaries is currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury Department (“OFAC”); and the Company and the Guarantors will not directly or indirectly use the proceeds of the offering of the First Lien Notes, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other person or entity, for the purpose of financing the activities of any person currently subject to any U.S. sanctions administered by OFAC.

(qq) Immediately after the consummation of the Transactions, each of the Company and the Guarantors will be Solvent. As used in this paragraph, the term “Solvent” means, with respect to a particular date, that on such date (i) the present fair market value (or present fair saleable value) of the assets of the relevant entity are not less than the total amount required to pay the probable liabilities of such entity on its total existing debts and liabilities (including contingent liabilities) as they become absolute and matured, (ii) the relevant entity is able to realize upon its assets and pay its debts and other liabilities, contingent obligations and

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commitments as they mature and become due in the normal course of business, (iii) assuming the completion of the transactions contemplated by the Transaction Documents, the relevant entity is not incurring debts or liabilities beyond its ability to pay as such debts and liabilities mature, (iv) the relevant entity is not engaged in any business or transaction, and is not about to engage in any business or transaction, for which its property would constitute unreasonably small capital after giving due consideration to the prevailing practice in the industry in which such entity is engaged, and (v) the relevant entity is not a defendant in any civil action that is reasonably expected to result in a judgment that such entity is or would become unable to satisfy. In computing the amount of such contingent liabilities at any time, it is intended that such liabilities will be computed at the amount that, in the light of all the facts and circumstances existing at such time, represents the amount that can reasonably be expected to become an actual or matured liability.

(rr) None of the Company or the Guarantors is a party to any contract, agreement or understanding with any person that would give rise to a valid claim against any of them or the Purchaser for a brokerage commission, finder’s fee or like payment in connection with the Transactions.

Any certificate signed by any officer of the Company and delivered to the Purchaser or counsel for the Purchaser in connection with the offering of the First Lien Notes shall be deemed a representation and warranty by the Company, as to matters covered thereby, to the Purchaser, and not a representation or warranty by the individual officer.

Any certificate signed by any officer of any of the Guarantors and delivered to the Purchaser or counsel for the Purchaser in connection with the offering of the First Lien Notes shall be deemed a representation and warranty by such Guarantor, as to matters covered thereby, to the Purchaser, and not a representation or warranty by the individual officer.

4. Representations, Warranties and Agreements of the Purchaser. The Purchaser hereby represents and warrants to the Company and the Guarantors as follows (it being understood that the Purchaser does not make any representation, warranty, covenant or agreement to any other purchaser of First Lien Notes or to the Company or the Guarantors on behalf of any other purchaser of the First Lien Notes):

(a) The Purchaser (i) is knowledgeable, sophisticated and experienced in making, and is qualified to make, decisions with respect to investments in securities representing an investment decision like that involved in the purchase of the First Lien Notes, and has requested, received, reviewed and considered all information it deems relevant in making an informed decision to purchase the First Lien Notes; (ii) is acquiring the First Lien Notes in the ordinary course of its business and for its own account for investment purposes only and with no present intention of distributing any of such First Lien Notes or any arrangement or understanding with any other persons regarding the distribution of such First Lien Notes; and (iii) will not, directly or indirectly, offer, sell, pledge, transfer or otherwise dispose of (or solicit any offers to buy, purchase or otherwise acquire or take a pledge of) any of the First Lien Notes except in compliance with the Securities Act and any applicable state securities laws.

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(b) The Purchaser is a “qualified institutional buyer” (as defined in Rule 144A under the Securities Act.

(c) The Purchaser understands and acknowledges that (i) the First Lien Notes are being offered in transactions not involving any public offering within the meaning of the Securities Act; (ii) the initial offering and issuance of the First Lien Notes has not been registered under the Securities Act or any other securities laws, (iii) if in the future it decides to resell, pledge or otherwise transfer the First Lien Notes that it purchases hereunder, those First Lien Notes, absent an effective registration statement under the Securities Act, may be resold, pledged or transferred only pursuant to an applicable exemption from registration under the Securities Act in accordance with any applicable securities laws of the states and other jurisdictions of the United States, and (iv) it will, and each subsequent holder of any of the First Lien Notes that it purchases in this offering is required to, notify any subsequent purchaser of such First Lien Notes from it or subsequent holders, as applicable, of the resale restrictions referred to in clause (iii) above.

(d) The Purchaser understands and acknowledges that the Company and the Guarantors are relying upon the truth and accuracy of, and the Purchaser’s compliance with, the representations, warranties, agreements, acknowledgments and understanding of the Purchaser set forth herein in order to determine the availability of such exemptions and the eligibility of the Purchaser to acquire the First Lien Notes.

(e) The Purchaser understands that the First Lien Notes will bear a restrictive legend substantially in the following form:

“THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER SECTION 5 OF THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND THE SECURITY EVIDENCED HEREBY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THE SECURITY EVIDENCED HEREBY IS HEREBY NOTIFIED THAT THE SELLER MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. THE HOLDER OF THE SECURITY EVIDENCED HEREBY AGREES FOR THE BENEFIT OF THE ISSUER THAT (A) SUCH SECURITY MAY BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY (i) (a) TO A PERSON WHO IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (b) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT, (c) OUTSIDE THE UNITED STATES TO A NON-U.S. PERSON IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 904 UNDER THE SECURITIES

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ACT, OR (d) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND BASED UPON AN OPINION OF COUNSEL IF THE ISSUER SO REQUESTS), (ii) TO THE ISSUER, OR (iii) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN EACH CASE IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION, AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER FROM IT OF THE SECURITY EVIDENCED HEREBY OF THE RESALE RESTRICTIONS SET FORTH IN CLAUSE (A) ABOVE. NO REPRESENTATION CAN BE MADE AS TO THE AVAILABILITY OF THE EXEMPTION PROVIDED BY RULE 144 FOR RESALE OF THE SECURITY EVIDENCED HEREBY.”

(f) (i) The Purchaser has full right, power, authority and capacity to enter into this Agreement and to consummate the transactions contemplated hereby and has taken all necessary action to authorize the execution, delivery and performance of this Agreement, and (ii) the execution, delivery and performance of the Agreement by the Purchaser and the consummation of the transactions herein contemplated will not violate any provision of the organizational documents of the Purchaser or any statute or any authorization, judgment, decree, order, rule or regulation of any court or any regulatory body, administrative agency or other governmental body applicable to Purchaser.

(g) The Purchaser understands that no United States federal or state agency or any other government or governmental agency has passed upon or made any recommendation or endorsement of the First Lien Notes or the fairness or suitability of the investment in the First Lien Notes nor have such authorities passed upon or endorsed the merits of the offering of the First Lien Notes.

(h) The Purchaser’s principal executive offices are in the jurisdiction set forth under the Purchaser’s signature on the signature block hereto.

(i) The Purchaser acknowledges that the Company, the Guarantors and its counsel will rely upon the accuracy of the foregoing acknowledgments, representations and agreements. The Purchaser agrees that if any of the acknowledgments, representations or agreements that Purchaser is deemed to have made by its purchase of the First Lien Notes is no longer accurate, it shall promptly notify the Company and the Guarantors. If the Purchaser is purchasing the First Lien Notes as a fiduciary or agent for one or more investor accounts, the Purchaser represents that it has sole investment discretion with respect to each of those accounts and full power to make the above acknowledgments, representations and agreements on behalf of each account.

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5. Agreements of the Company and the Guarantors. The Company and the Guarantors, jointly and severally, agree with the Purchaser as follows:

(a) The Company and the Guarantors will apply the net proceeds from the sale of the First Lien Notes to be sold by the Company hereunder substantially in accordance with the description set forth in the Disclosure Package under the caption “Unaudited Pro Forma Condensed Combined Financial Information”.

(b) The Company, the Guarantors and their respective Affiliates will not take, directly or indirectly, any action designed to or that has constituted or that reasonably could be expected to cause or result in the stabilization or manipulation of the price of any security of the Company and the Guarantors in connection with the offering of the First Lien Notes.

(c) The First Lien Notes will be eligible for clearance and settlement in the United States through DTC and in Europe through Euroclear Bank, S.A./N.V., or Clearstream Banking, société anonyme.

(d) The Company and the Guarantors will not, and will not cause their respective Affiliates to, engage in any “directed selling efforts” within the meaning of Rule 902 under the Securities Act.

(e) The Company and the Guarantors will, and will cause their respective Affiliates to, comply with and implement the “offering restrictions” required by Rule 902 under the Securities Act with respect to the sale of the First Lien Notes.

(f) The Company and the Guarantors agree not to sell, offer for sale or solicit offers to buy or otherwise negotiate in respect of any security (as defined in the Securities Act) that would be integrated with the sale of the First Lien Notes in a manner that would require the registration under the Securities Act of the sale to the Purchaser of the First Lien Notes. The Company and the Guarantors will take reasonable precautions designed to insure that any offer or sale, direct or indirect, in the United States or to any U.S. person (as defined in Rule 902 under the Securities Act) or U.S. resident (as defined in the Investment Company Act), of any Notes or any substantially similar security issued by the Company or the Guarantors, within six months subsequent to the date on which the distribution of the First Lien Notes has been completed (as notified to the Company by the Purchaser), is made under restrictions and other circumstances reasonably designed not to affect the status of the offer and sale of the First Lien Notes in the United States and to U.S. persons or U.S. residents contemplated by this Agreement as transactions exempt from the registration provisions of the Securities Act, including any sales pursuant to Rule 144A under, or Regulations D or S of, the Securities Act.

(g) The Company and the Guarantors agree to comply with all agreements set forth in the representation letters of the Company and the Guarantors to DTC relating to the approval of the First Lien Notes by DTC for “book entry” transfer.

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6. Conditions to Purchaser’s Obligations. The obligations of the Purchaser hereunder are subject (i) to the accuracy of the representations and warranties of the Company and the Guarantors contained herein, (ii) to the accuracy of the statements of each of the Company, the Guarantors and each of their respective officers made in any certificate delivered pursuant hereto, (iii) to the performance by the Company and the Guarantors of their respective obligations hereunder, and (iv) to each of the following additional terms and conditions:

(a) All corporate proceedings and other legal matters incident to the authorization, form and validity of the Transaction Documents and all other legal matters relating to this Agreement and the transactions contemplated hereby shall be reasonably satisfactory in all material respects to counsel for the Purchaser, and the Company and the Guarantors shall have furnished to such counsel all documents and information that they may reasonably request to enable them to pass upon such matters.

(b) Kirkland & Ellis, LLP, special counsel to the Company and the Guarantors, shall have delivered an opinion reasonably satisfactory to the Purchaser;

(c) Carlsmith Ball LLP, special Hawaii counsel to Hawaii Stevedores, Inc., shall have delivered an opinion reasonably satisfactory to the Purchaser;

(d) The Parent shall have furnished or caused to be furnished to the Purchaser a certificate of the Chief Financial Officer of the Parent, or other officers satisfactory to the Purchaser, dated the date hereof, as to such matters as the Purchaser may reasonably request, including, without limitation, a statement that:

(i) The representations, warranties and agreements of the Company and the Guarantors, as applicable, in Section 3 herein and in any other Transaction Document to which each of the Company and any of the Guarantors, as applicable, is a party are true and correct, and the Company and the Guarantors, as applicable, has complied with all its agreements contained herein and in any other Transaction Document to which it is a party and satisfied all the conditions on its part to be performed or satisfied hereunder or thereunder;

(ii) They have carefully examined the Disclosure Package and, in their opinion, the Disclosure Package, as of the date hereof, does not contain any untrue statement of a material fact and does not omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.

(e) The Parent shall have furnished or caused to be furnished to the Purchaser a certificate of the Parent, dated the date hereof, substantially in the form of Exhibit VI hereto.

(f) The Parent shall have furnished or caused to be furnished to the Purchaser a solvency certificate, dated the date hereof, substantially in the form of Exhibit VII hereto.

(g) The First Lien Notes shall be eligible for clearance and settlement through DTC.

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(h) The Company and the Trustee shall have executed and delivered the Indenture, and the Purchaser shall have received an original copy thereof, duly executed by the Company and the Trustee.

(i) The First Lien Notes shall have been duly executed and delivered by the Company and duly authenticated by the Trustee.

(j) The Note Guarantees shall have been duly executed and delivered by the Guarantors.

(k) Each Notation of Guarantee shall have been duly executed and delivered by the Guarantors.

(l) Each of the Transaction Documents shall have been duly executed and delivered by the respective parties thereto (other than the Purchaser).

(m) The representations and warranties of each of the Company and the Guarantors (to the extent a party thereto) contained in the Transaction Documents to which each of the Company and any such Guarantor is a party are true and correct as of the date hereof.

(n) First Lien Notes (in an aggregate principal amount equal to $225.0 million less the aggregate principal amount of First Lien Notes sold hereby) shall have been sold pursuant to the other First Lien Purchase Agreements simultaneously with the sale of the First Lien Notes sold hereby, and the use of proceeds therefrom shall conform to the description in the Disclosure Package under “Unaudited Pro Forma Condensed Combined Financial Information”.

(o) The Second Lien Notes shall have been issued, and the use of proceeds therefrom shall conform to the description in the Disclosure Package under “Unaudited Pro Forma Condensed Combined Financial Information”.

(p) All parties to the New ABL Facility shall have executed and delivered the New ABL Facility and all borrowings thereunder contemplated by the Disclosure Package shall have been made.

(q) The Exchange Offer and the other Transactions shall have been consummated as contemplated by the Disclosure Package.

All opinions, letters, evidence and certificates mentioned above or elsewhere in this Agreement shall be deemed to be in compliance with the provisions hereof only if they are in form and substance reasonably satisfactory to counsel for the Purchaser.

7. Indemnification and Contribution.

(a) Each of the Company and the Guarantors hereby agrees, jointly and severally, to indemnify and hold harmless the Purchaser, its Affiliates, directors, officers and employees and each person, if any, who controls the Purchaser within the meaning of Section 15

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of the Securities Act or Section 20 of the Exchange Act, from and against any loss, claim, damage or liability, joint or several, or any action in respect thereof (including, but not limited to, any loss, claim, damage, liability or action relating to purchases and sales of First Lien Notes), to which the Purchaser, affiliate, director, officer, employee or controlling person may become subject, under the Securities Act or otherwise, insofar as such loss, claim, damage, liability or action arises out of, or is based upon, (i) any breach by the Company or the Guarantors of any representation or warranty or material failure to comply with any of the covenants and agreements contained in this Agreement, (ii) any untrue statement or alleged untrue statement of a material fact contained (A) in the Disclosure Package or in any amendment or supplement thereto, (B) in any Blue Sky application or other document prepared or executed by the Company or the Guarantors (or based upon any written information furnished by the Company or the Guarantors) specifically for the purpose of qualifying any or all of the First Lien Notes under the securities laws of any state or other jurisdiction (any such application, document or information being hereinafter called a “Blue Sky Application”), (iii) the omission or alleged omission to state in the Disclosure Package, or in any amendment or supplement thereto, in any Blue Sky Application, any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading or (iv) the Transactions (other than those contemplated by this Agreement) and shall reimburse the Purchaser and each such director, officer, employee or controlling person promptly upon demand for any legal or other expenses reasonably incurred by the Purchaser, affiliate, director, officer, employee or controlling person in connection with investigating or defending or preparing to defend against any such loss, claim, damage, liability or action as such expenses are incurred. The foregoing indemnity agreement is in addition to any liability that the Company and the Guarantors may otherwise have to the Purchaser or to any affiliate, director, officer, employee or controlling person of the Purchaser.

(b) Promptly after receipt by an indemnified party under this Section 7 of notice of any claim or the commencement of any action, the indemnified party shall, if a claim in respect thereof is to be made against the indemnifying party under this Section 7, notify the indemnifying party in writing of the claim or the commencement of that action; provided, however, that the failure to notify the indemnifying party shall not relieve it from any liability that it may have under this Section 7 except to the extent it has been materially prejudiced (through the forfeiture of substantive rights or defenses) by such failure and; provided, further, that the failure to notify the indemnifying party shall not relieve it from any liability that it may have to an indemnified party otherwise than under this Section 7. If any such claim or action shall be brought against an indemnified party, and it shall notify the indemnifying party thereof, the indemnifying party shall be entitled to participate therein and, to the extent that it wishes, jointly with any other similarly notified indemnifying party, to assume the defense thereof with counsel reasonably satisfactory to the indemnified party. After notice from the indemnifying party to the indemnified party of its election to assume the defense of such claim or action, the indemnifying party shall not be liable to the indemnified party under this Section 7 for any legal or other expenses subsequently incurred by the indemnified party in connection with the defense thereof other than reasonable costs of investigation; provided, however, that the Purchaser shall have the right to employ counsel to represent jointly the Purchaser and its directors, officers, employees and controlling persons who may be subject to liability arising out of any claim in respect of which indemnity may be sought by the Purchaser against any of the Company or the Guarantors under this Section 7, if (i) the Company, the

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Guarantors and the Purchaser shall have so mutually agreed; (ii) the Company and the Guarantors have failed within a reasonable time to retain counsel reasonably satisfactory to the Purchaser; (iii) the Purchaser and its respective directors, managers, officers, employees and controlling persons shall have reasonably concluded, based on the advice of counsel, that there may be legal defenses available to them that are different from or in addition to those available to the Company or the Guarantors; or (iv) the named parties in any such proceeding (including any impleaded parties) include both the Purchaser or its directors, officers, employees or controlling persons, on the one hand, and the Company or the Guarantors, on the other hand, and representation of both sets of parties by the same counsel would present a conflict due to actual or potential differing interests between them, and in any such event the fees and expenses of such separate counsel shall be paid by the Company and the Guarantors. No indemnifying party shall (x) without the prior written consent of the indemnified parties (which consent shall not be unreasonably withheld), settle or compromise or consent to the entry of any judgment with respect to any pending or threatened claim, action, suit or proceeding in respect of which indemnification or contribution may be sought hereunder (whether or not the indemnified parties are actual or potential parties to such claim or action) unless such settlement, compromise or consent includes an unconditional release of each indemnified party from all liability arising out of such claim, action, suit or proceeding and does not include a statement as to, or an admission of fault, culpability or a failure to act by or on behalf of any indemnified party, or (y) be liable for any settlement of any such action effected without its written consent (which consent shall not be unreasonably withheld), but if settled with the consent of the indemnifying party or if there be a final judgment of the plaintiff in any such action, the indemnifying party agrees to indemnify and hold harmless any indemnified party from and against any loss or liability by reason of such settlement or judgment.

(c) If the indemnification provided for in this Section 7 shall for any reason be unavailable to or insufficient to hold harmless an indemnified party under Section 7(a) in respect of any loss, claim, damage or liability, or any action in respect thereof, referred to therein, then each indemnifying party shall, in lieu of indemnifying such indemnified party, contribute to the amount paid or payable by such indemnified party as a result of such loss, claim, damage or liability, or action in respect thereof, in such proportion as shall be appropriate to reflect the relative fault of the Company and the Guarantors, on the one hand, and the Purchaser, on the other, with respect to the statements or omissions that resulted in such loss, claim, damage or liability, or action in respect thereof, as well as any other relevant equitable considerations. The relative fault shall be determined by reference to whether the untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact relates to information supplied by the Company and the Guarantors, or the Purchaser, the intent of the parties and their relative knowledge, access to information and opportunity to correct or prevent such statement or omission. The Company, the Guarantors and the Purchaser agree that it would not be just and equitable if contributions pursuant to this Section 7(c) were to be determined by pro rata allocation or by any other method of allocation that does not take into account the equitable considerations referred to herein. The amount paid or payable by an indemnified party as a result of the loss, claim, damage or liability, or action in respect thereof, referred to above in this Section 7 shall be deemed to include, for purposes of this Section 7 any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim.

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8. Termination. The obligations of the Purchaser hereunder may be terminated by the Purchaser by notice given to and received by the Company prior to delivery of and payment for the First Lien Notes if the Purchaser shall decline to purchase the First Lien Notes for any reason permitted under this Agreement.

9. Notices, etc. All statements, requests, notices and agreements hereunder shall be in writing, and:

(a) if to the Purchaser, shall be delivered or sent by hand delivery, mail, telex, overnight courier or facsimile transmission to the address specified on the signature page hereto, with a copy to Paul, Weiss, Rifkind, Wharton & Garrison LLP, 1285 Avenue of the Americas, New York, NY 10019, Attention: Lawrence Wee; and

(b) if to any of the Company or the Guarantors, shall be delivered or sent by mail, overnight courier or facsimile transmission to Horizon Lines, Inc. 4064 Colony Road, Suite 200, Charlotte, NC 28211, Attention: General Counsel, with a copy to Kirkland & Ellis LLP, 601 Lexington Avenue, New York, NY 10023, Attention: Christian Nagler.

10. Survival. The respective indemnities, rights of contribution, representations, warranties and agreements of the Company or the Guarantors and the Purchaser contained in this Agreement or made by or on behalf of them, respectively, pursuant to this Agreement, shall survive the delivery of and payment for the First Lien Notes and shall remain in full force and effect, regardless of any termination of this Agreement or any investigation made by or on behalf of any of them or any person controlling any of them.

11. Definition of the Terms “Business Day”, “Affiliate”, and “Subsidiary.” For purposes of this Agreement, (a) “business day” means any day on which the New York Stock Exchange, Inc. is open for trading, and (b) “affiliate” and “subsidiary” have the meanings set forth in Rule 405 under the Securities Act.

12. Governing Law. This Agreement and any matters arising out of or in any way relating to this Agreement shall be governed by and construed in accordance with the laws of the State of New York.

13. Submission to Jurisdiction. Each of the parties hereto hereby irrevocably and unconditionally:

(a) submits for itself and its property in any legal action or proceeding relating to this Agreement or any of the transactions contemplated hereby, or for recognition and enforcement of any judgment in respect thereof, to the non-exclusive general jurisdiction of the State or Federal courts sitting in the Borough of Manhattan, the City of New York (“New York Courts”);

(b) consents that any such action or proceeding may be brought in such New York Courts and waives any objection that it may now or hereafter have to the venue of any such action or proceeding in any such New York Court or that such action or proceeding was brought in an inconvenient court and agrees not to plead or claim the same;

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(c) agrees that service of process in any such action or proceeding may be effected by mailing a copy thereof by registered or certified mail (or any substantially similar form of mail), postage prepaid, to any party hereto at its address set forth in Section 9 or at such other address of which such party shall have been notified pursuant thereto; and

(d) agrees that nothing herein shall affect the right to effect service of process in any other manner permitted by law or shall limit the right to sue in any other jurisdiction; and waives, to the maximum extent not prohibited by law, any right it may have to claim or recover in any legal action or proceeding referred to in this Section 13 any special, exemplary, punitive or consequential damages.

14. Waiver of Jury Trial. The Company, the Guarantors and the Purchaser hereby irrevocably waive, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising out of or relating to this Agreement or the transactions contemplated hereby.

15. Counterparts. This Agreement may be executed in one or more counterparts and, if executed in more than one counterpart, the executed counterparts shall each be deemed to be an original but all such counterparts shall together constitute one and the same instrument.

16. Headings. The headings herein are inserted for convenience of reference only and are not intended to be part of, or to affect the meaning or interpretation of, this Agreement.

17. Delivery of Payment. If the Company has not received payment in full for any of the First Lien Notes purchased pursuant hereto prior to 4:00 p.m., New York City time, on October 5, 2011, upon written request by the Company, the Purchaser shall surrender to the Company for cancellation such First Lien Notes for which payment has not been received.

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If the foregoing correctly sets forth the agreement among the Company, the Guarantors and the Purchaser, please indicate your acceptance in the space provided for that purpose below.

HORIZON LINES, LLC
By:
	Name:
	Title:
The Company hereby acknowledges receipt of $[            ] from the Purchaser as payment for the First Lien Notes indicated on the signature page hereto.
GUARANTORS:
HORIZON LINES, INC. HORIZON LINES HOLDING CORP. HAWAII STEVEDORES, INC. HORIZON LINES OF PUERTO RICO, INC. HORIZON LINES OF ALASKA, LLC HORIZON LINES OF GUAM, LLC HORIZON LINES VESSELS, LLC H-L DISTRIBUTION SERVICE, LLC HORIZON LOGISTICS, LLC AERO LOGISTICS, LLC SEA-LOGIX, LLC HORIZON SERVICES GROUP, LLC
By:
	Name:
	Title:

[Signature Page to Note Purchase Agreement]

Accepted:

[    ]

a
	[Jurisdiction]	[Form of Entity]

on behalf of certain funds and/or accounts

it manages and/or advises

By:
	Name:
	Title:

Principal executive office of the Purchaser:

c/o [    ]

The above Purchaser hereby acknowledges receipt of $[            ] aggregate principal amount of First Lien Notes.

[Signature Page to Note Purchase Agreement]

Annex 1

Purchaser’s DTC Account Information

Annex 1

Exhibit I

Form of Indenture for the First Lien Notes

Exhibit II

Form of Security Agreement

3

Exhibit III

Form of Intercreditor Agreement

4

Exhibit IV

Form of Registration Rights Agreement

5

Exhibit V

List of Subsidiaries of the Company and the Guarantors

HORIZON LINES, INC.

HORIZON LINES HOLDING CORP.

HAWAII STEVEDORES, INC.

HORIZON LINES OF PUERTO RICO, INC.

HORIZON LINES OF ALASKA, LLC

HORIZON LINES OF GUAM, LLC

HORIZON LINES VESSELS, LLC

H-L DISTRIBUTION SERVICE, LLC

HORIZON LOGISTICS, LLC

AERO LOGISTICS, LLC

SEA-LOGIX, LLC

HORIZON SERVICES GROUP, LLC

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EXHIBIT VI

OFFICER’S CERTIFICATE OF

HORIZON LINES, INC.

The undersigned, [                    ], does hereby certify that he is the [                    ] of Horizon Lines, Inc., a Delaware corporation (the “Company”). Reference is hereby made to the commitment letters, dated as of August 26, 2011 (each, a “Commitment Letter” and collectively, the “Commitment Letters”) by and between the Company and holders of its 4.25% convertible senior notes due in 2012 issued under the Indenture, dated as of August 8, 2007, by and between the Company, as issuer, and The Bank of New York Trust Company, N.A., as Trustee, in the aggregate principal amount of $330,000,000.00 and certain other third parties (each, a “Commitment Party” and collectively, the “Commitment Parties”).

Pursuant to Section 7 of each Commitment Letter, the funding of the commitment of each Commitment Party is subject to satisfaction of, among other things, the legal and documentary conditions described on Exhibit G to each Commitment Letter, attached hereto as Annex A.

Pursuant to Section 21 of Exhibit G of each Commitment Letter, I do hereby certify, in my capacity as such officer and not in a personal capacity, on behalf of the Company, that all of the conditions set forth in items 6, 7, 8, 10, 12, 13, 14, 16, 17, 18 and 20 of Exhibit G (to the extent such conditions do not consist of the satisfaction of or approvals of the Commitment Parties or their representatives) of each Commitment Letter have been satisfied.

[Remainder of page intentionally left blank]

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IN WITNESS WHEREOF, the undersigned have executed this Officer’s Certificate as of this 5th day of October, 2011.

HORIZON LINES, INC.

By:

Name:

Title

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ANNEX A

Exhibit G to Commitment Letter

Legal and Documentary Conditions

In addition to the conditions described in the body of the Commitment Letter, the obligations of each Commitment Party under the Commitment Letter to fund its Commitment with respect to the Secured Notes are subject to the satisfaction or waiver (in accordance with the “Amendments” Section thereof) of the following additional conditions precedent (capitalized terms used and not otherwise defined in this Exhibit G have the meanings given to them in the Commitment Letter or Exhibit C and D, as applicable):

18. Exchange Offer, New ABL Facility. The Exchange Offer and entry into the New ABL Facility shall be consummated pursuant to the RSAs substantially simultaneously with the purchase of the Secured Notes and no provision thereof shall have been amended or waived (and, in the case of the New ABL Facility, no consent to deviation from the requirements thereof shall have been granted by the lenders thereunder), in each case, in any material respect adverse to the Commitment Parties, solely in their capacity as providers of their respective Commitment.

19. Financing Terms. The terms of the Secured Notes, the terms and conditions of the Convertible Secured Notes and the New ABL Facility (including but not limited to terms and conditions relating to the interest rate, fees, amortization, maturity, subordination, covenants, events of default and remedies), shall be consistent in all material respects with the terms set forth herein and in the RSAs and otherwise reasonably satisfactory in all respects to the Commitment Parties.

20. Absence of Defaults. There shall not exist any default or event of default on the Closing Date under the Indenture after giving effect to the use of the proceeds of the Secured Notes. There shall not exist any default or event of default on the Closing Date under the Note Purchase Agreements.

21. Trustees. The trustee under the indenture governing the First Lien Secured Notes, the trustee under the indenture governing the Second Lien Secured Notes and the trustee under the indenture governing the Convertible Secured Notes shall not have taken action that would reasonably be expected to adversely affect (in any material respect) the consummation of any of the Transactions on the Closing Date and shall have taken no action that challenges the validity or effectiveness of the procedures used by the Company in the making the Exchange Offer or the Consent Solicitation.

22. Definitive Documentation; Customary Closing Documents. The parties shall have executed and delivered (or be willing to execute and deliver) for the First Lien Secured Notes and the Second Lien Secured Notes (a) the respective Note Purchase Agreements, containing a 10b-5 representation in connection with any transaction contemplated by the Restructuring, including the Exchange Offer, as to the information contained in the S-4 registration statement filed, and agreed upon indemnities plus other terms, consistent in all material respects with this Commitment Letter, by and among the Issuer and the other parties thereto (including a representation by each purchaser thereunder that it is either a “qualified institutional buyer” or an

9

institution that is an “accredited investor” (each as defined in the Security Act)), except that as the Commitment Parties are not underwriters, there shall be no requirement for an offering memorandum or other offering documentation beyond the documentation and information necessary to satisfy the requirements of Rule 144A(d)(4) promulgated under the Securities Act; (b) the indenture governing the First Lien Secured Notes consistent with the terms set forth in Exhibit C and otherwise containing customary terms for the First Lien Secured Notes issued in a private placement and eligible for resale on a “144A-for-life” basis; (c) the indenture governing the Second Lien Secured Notes consistent with the terms set forth in Exhibit D and otherwise containing customary terms for the Second Lien Secured Notes issued in a private placement and eligible for resale on a “144A-for-life” basis; and (d) pledge and security agreements covering the collateral for the First Lien Secured Notes and the Second Lien Secured Notes; in each of cases (a) through (d) in form and substance consistent in all material respects with this Commitment Letter and otherwise reasonably satisfactory to the Supermajority Commitment Parties and the Company (collectively, the “Definitive Documentation”); and the Commitment Parties shall have received customary closing certificates (including a solvency certificate of a financial officer as to the solvency of the Borrower and its subsidiaries, taken as a whole, after giving effect to the Transactions), customary legal opinions (for the avoidance of doubt, other than a 10b-5 letter), customary corporate documents, customary evidence of corporate authority, and customary certificates of good standing in the Loan Parties’ respective jurisdictions of formation.

23. Representations and Warranties. The representations and warranties made by the Company and its subsidiaries herein, or which are contained in any certificate furnished at any time under or in connection herewith shall (i) with respect to representations and warranties that contain a materiality qualification, be true and correct and (ii) with respect to representations and warranties that do not contain a materiality qualification, be true and correct in all material respects, in each case on and as of the Closing Date as if made on and as of such date (except for those which expressly relate to an earlier date).

24. Bankruptcy. There shall be no bankruptcy or insolvency proceedings pending with respect to the Company or any subsidiary thereof.

25. Discharge of Existing Debt. After giving effect to the Transactions, the Company and its subsidiaries shall have (A) no outstanding indebtedness other than (i) up to $280 million of Convertible Secured Notes, (ii) $325 million of Secured Notes, (iii) borrowings under the New ABL Facility; and (iv) existing Notes that have not been tendered into the Exchange Offer in an aggregate principal amount not exceeding the amount permitted to remain outstanding after the Closing Date under the terms of the RSAs; and (B) no liens in respect of borrowed money, other than liens permitted by or expressly provided for under the New ABL Facility, Bridge Loan Facility or the indentures governing the First Lien Secured Notes and the Second Lien Secured Notes and/or liens outstanding immediately prior to the Closing Date (and not securing the First Lien Facility).

26. Expenses. All expenses, including legal fees, required to be paid to the Commitment Parties under the “Expenses” section of this Commitment Letter shall have been paid in full.

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27. Litigation. Except as disclosed in the RSAs, there shall not have been instituted, threatened or be pending against, or with respect to, the Company or any of its subsidiaries any action, bankruptcy or insolvency, injunction, proceeding, application, order, claim counterclaim or investigation (whether formal or informal) (and there shall have been no material adverse development to any action, application, claim counterclaim or proceeding currently instituted, threatened or pending) before or by any stock exchange, court or any governmental, regulatory or administrative agency or instrumentally, domestic or foreign, or by any other person, domestic or foreign, in connection with the Transactions that would or would reasonably be expected to (i) prohibit, prevent, restrict or delay consummation of any of the Transactions, or (ii) impose burdensome restrictions on the Transactions.

28. Intercreditor Agreement. The agent, on behalf of itself and the lenders, under the New ABL Facility shall have entered into an intercreditor agreement (the “Intercreditor Agreement”) with the trustee on behalf of the purchasers of the First Lien Secured Notes, the trustee on behalf of the purchasers of the Second Lien Secured Notes and the trustee on behalf of the holders of new Convertible Secured Notes that is not materially less favorable to the holders of the First Lien Secured Notes and the holders of the Second Lien Secured Notes than the terms described on Exhibit C and D, respectively.

29. Audited Financial Statements. The Commitment Parties shall have received audited consolidated balance sheets and related statements of operations, stockholder’s equity and cash flows, together with all footnotes thereto, accompanied by the reports thereon of the accountants of the Company and its subsidiaries as of and for the three most recently completed fiscal years ended at least ninety days before the Closing Date, which (x) were prepared in accordance with the books of account and other financial records of the Company, (y) except as disclosed in the Secured Notes and schedules thereto, have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”), consistently applied without modification of the accounting principles used in the preparation thereof throughout the periods presented, and (z) present fairly the consolidated financial condition, results of operations and cash flows of the Company, as applicable, as at the dates and for the periods indicated therein, except to the extent any failure of the foregoing clauses to be true and correct does not result in or constitute a MAC (as defined in the RSAs).

30. Unaudited Financial Statements. The Commitment Parties shall have received (a) unaudited consolidated balance sheets and related statements of operations, stockholder’s equity and cash flows of the Company and its subsidiaries for each fiscal quarter ended after the date of this Commitment Letter and at least sixty (60) days before the Closing Date, which were prepared in accordance with GAAP, subject to the absence of footnotes and normal year-end adjustments, and (b) a pro forma consolidated balance sheet and related pro forma consolidated statement of operations of the Company and its subsidiaries for the twelve-month period ending on the last day of the most recently completed four-fiscal quarter period ended at least sixty (60) days prior to the Closing Date, prepared after giving effect to the Transactions, as if such Transactions had occurred as of such date (in the case of such balance sheet) or at the beginning of such period (in the case of such other financial statements).

31. Consents. Counsel to the Commitment Parties shall have received evidence that all boards of directors, governmental, shareholder and material third party consents and approvals

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(if any) necessary in connection with the Transactions have been obtained or duly waived and all applicable waiting periods have expired without any action being taken by any authority that could restrain, prevent or impose any material adverse conditions on such transactions or that could seek or threaten any of the foregoing.

32. PATRIOT Act. The Issuer shall have delivered all documentation and other information reasonably required by regulatory authorities under applicable “know-your-customer” and anti-money laundering rules and regulations, including the PATRIOT Act, in any case, requested in writing by the Commitment Parties at least three Business Days prior to the Closing Date.

33. Compliance with Laws. The issuance of the Secured Notes and other Transactions contemplated hereby shall be in compliance in all material respects with all applicable laws and regulations and no order, statute, rule, regulation, executive order, stay, decree, judgment or injunction shall have been proposed, enacted, entered, issued, promulgated, enforced or deemed applicable by any stock exchange, court or any governmental, regulatory or administrative agency or instrumentally, that would or would reasonably be expected to (i) prohibit, prevent, restrict or delay consummation of the Transactions, or (ii) impose burdensome restrictions on the Transaction.

34. Suspension/Limitation on Trading. There shall not have occurred (i) any general suspension of, or limitation on prices for, trading in securities in the United States securities or financial markets, (ii) any material impairment in the trading market for debt securities, (iii) any declaration of a banking moratorium or any suspension of payments in respect to banks in the United States or other major financial markets, (iv) any limitation (whether or not mandatory) by any stock exchange, government or governmental, administrative or regulatory authority or agency, domestic or foreign, or other event that might affect the extension of credit by banks or other lending institutions, (v) a commencement of a war, armed hostilities, terrorist acts or other national or international calamity directly or indirectly involving the United States or (vi) in the case of any of the foregoing existing on the date hereof, a material acceleration or worsening thereof.

35. Material Adverse Change. Except as set forth on Schedule I hereto, since March 31, 2011, no MAC has occurred and is continuing in the business, properties, operations, financial condition, assets or liabilities (whether actual or contingent) of the Company and its subsidiaries, taken as a whole.

36. Collateral. All Uniform Commercial Code UCC-1 financing statements reasonably necessary or desirable to create and perfect the first priority and second priority (as applicable) liens and security interests in respect of the collateral securing the Secured Notes shall have been delivered for filing, customary short-form security agreements with respect to intellectual property shall have been executed and delivered to the Collateral Agent for filing with the U.S. Patent and Trademark Office and the U.S. Copyright Office and certificates representing the capital stock and membership interests (to the extent issued and certificated) of the Issuer and Guarantors shall have been delivered to the collateral agent (or to its designated advisors) under the Indenture; provided that, to the extent the creation of any lien on any collateral or perfection of such lien requires any action on the part of any third party (including, without limitation, delivery of reasonably satisfactory mortgages, title insurance policies, surveys and other

12

customary documentation in connection with real estate collateral) and is not provided on the Closing Date after the Issuer’s use of commercially reasonable efforts to do so (other than in respect of the filing of financing statements and the delivery of short-form security agreements and certificates representing capital stock and membership interest, in each case as set forth above), the creation or perfection (as applicable) of such lien shall not constitute a condition precedent to the issuance of the Secured Notes on the Closing Date but such action shall be required to have been taken within a commercially reasonable time after the Closing Date and in any event within 90 days thereafter, subject to exceptions to perfection requirements to be reasonably agreed.

37. Qualification. After giving effect to the debt financing and other transactions contemplated hereby, the Company and its subsidiaries shall each be qualified as “a citizen of the United States” within the meaning of Section 2 of the Shipping Act, 1916, as amended, 46 U.S.C. § 50501(a) and (d), qualified to own and operate vessels in the coastwise trade of the United States to the extent required by such Act in connection with the Company and its subsidiaries’ business.

38. Closing; Company Deliverables. On the Closing Date, the Company shall have (i) delivered to the Commitment Parties a certificate signed by an executive officer of the Company pursuant to which such officer shall certify that all of the conditions set forth in items 6, 7, 8, 10, 12, 13, 14, 16, 17, 18 and 20 on this Exhibit G (to the extent such conditions do not consist of the satisfaction of or approvals of the Commitment Parties or their representatives) have been satisfied (or waived in writing by Commitment Parties), and (ii) delivered to each Commitment Party designated on Exhibit A and Exhibit B to the Commitment Letter the Secured Notes duly registered in name of such Commitment Party or its affiliates or its designee.

39. Information Verification. The Company shall have satisfied the information verification requirements described in a letter to a representative of the Exchanging Holders on or prior to the date of this Commitment Letter.

40. Additional Matters. The parties shall, in good faith, work and cooperate together on the corporate, tax and regulatory aspects of the Transactions and the post-reorganized Company so that the resolution of such matters is reasonably satisfactory to the Commitment Parties. Any new shipping charters entered into after the date hereof shall be in form and substance reasonably satisfactory to the Commitment Parties.

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EXHIBIT VII

SOLVENCY CERTIFICATE

I, Michael T. Avara, the duly authorized and acting Chief Financial Officer of HORIZON LINES, INC., a Delaware corporation (the “Company”), pursuant to the commitment letters, dated as of August 26, 2011 (each, a “Commitment Letter” and collectively, the “Commitment Letters”) by and between the Company and certain holders of its 4.25% convertible senior notes due in 2012 issued under the Indenture, dated as of August 8, 2007, by and between the Company, as issuer, and The Bank of New York Trust Company, N.A., as Trustee, in the aggregate principal amount of $330,000,000.00 and certain other third parties (each, a “Commitment Party” and collectively, the “Commitment Parties”) do hereby certify in the name of and on behalf of the Company and its Subsidiaries, and in my capacity as Chief Financial Officer of the Company, but without any personal liability, as follows (capitalized terms used herein and not otherwise defined herein shall have the meanings ascribed thereto in the Commitment Letter):

41. On the date hereof and after giving effect to the Transactions:

(a) the fair value of the assets of the Company and its Subsidiaries, on a consolidated basis, is greater than the total amount of liabilities, including contingent, subordinated, absolute, fixed, matured or unmatured and liquidated or unliquidated liabilities, of the Company and its Subsidiaries, on a consolidated basis;

(b) the present fair saleable value of the assets of the Company and its Subsidiaries, on a consolidated basis, exceeds (i) the amount that will be required to pay the probable liability of the Company and its Subsidiaries, on a consolidated basis, on the debts of the Company and its Subsidiaries, on a consolidated basis, as such debts become absolute and matured and (ii) the total liabilities of the Company and its Subsidiaries, on a consolidated basis (including, without limitation, subordinated, unmatured, unliquidated and known contingent liabilities);

(c) the Company and its Subsidiaries, on a consolidated basis, are able to pay their debts and other liabilities, contingent obligations and other commitments as they mature in the normal course of business;

(d) the Company and its Subsidiaries, on a consolidated basis, are not engaged in business or any transaction, or are about to engage in business or any transaction, for which their property would constitute unreasonably small capital; and

(e) the Company and its Subsidiaries, on a consolidated basis, are not “insolvent” as such term is defined in Section 101(32) of Title 11 of the United States Code, 11 U.S.C. Section 101, et. seq.

42. In consummating the Transactions, neither the Company nor any of its Subsidiaries intends to hinder, delay or defraud either present or future creditors of the Company or any of its Subsidiaries.

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43. In reaching the conclusions set forth in this Certificate, I have made such investigation and inquiries as to the financial condition of the Company and its Subsidiaries as I deem necessary and prudent for the purpose of providing this Certificate, including without limitation:

(a) the cash and other current assets of the Company and its Subsidiaries, on a consolidated basis; and

(b) all contingent liabilities of the Company and its Subsidiaries, on a consolidated basis, including, without limitation, claims arising out of pending or threatened litigation against any such entity, and in so doing, have computed the amount of such liabilities as the amount which, in light of all the facts and circumstances existing on the date hereof, represents the amount that can reasonably be expected to become an actual or matured liability.

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IN WITNESS WHEREOF, I have executed this Certificate as of the date first above written.

By:
	Name:
	Title:    Chief Financial Officer

EX-10.2

Exhibit 10.2

EXECUTION VERSION

HORIZON LINES, LLC

SECOND LIEN SENIOR SECURED NOTES DUE 2016

PURCHASE AGREEMENT

October 5, 2011

The Purchaser named on the signature page hereto

Located at the address specified on the signature page hereto

Ladies and Gentlemen:

Horizon Lines, LLC, a Delaware limited liability company (the “Company”) proposes, upon the terms and conditions set forth in this agreement (this “Agreement”), to issue and sell to the purchaser named herein (the “Purchaser”), the aggregate principal amount of its Second Lien Senior Secured Notes due 2016 (the “Second Lien Notes”) that is indicated on the signature page of the Purchaser hereto. The Second Lien Notes (i) are to be issued pursuant to an Indenture (the “Indenture”), to be dated of even date herewith and entered into among the Company, the Guarantors (as defined below) party thereto and U.S. Bank National Association, a national banking association, as trustee and collateral agent (in such capacity, the “Trustee”). The Company’s obligations under the Second Lien Notes, including the due and punctual payment of interest on the Second Lien Notes, will be irrevocably and unconditionally guaranteed (the “Note Guarantees”) by Horizon Lines, Inc., a Delaware corporation (the “Parent”) and the Restricted Subsidiaries of the Parent who will agree to be guarantors under the Indenture (together, with the Parent, the “Guarantors”), pursuant to a Notation of Guarantee, each to be dated of even date herewith, by the Guarantors (the “Notation of Guarantee”). As used herein, the term “Second Lien Notes” shall include the Note Guarantees, unless the context otherwise requires. This Agreement is to confirm the agreement concerning the purchase of the Second Lien Notes from the Company by the Purchaser. The obligations of the Company and the Guarantors under the Indenture and the Second Lien Notes will be governed by a Pledge and Security Agreement among the Company, the Guarantors and the Trustee, of even date herewith (the “Security Agreement”). The Second Lien Notes will be subject to a Registration Rights Agreement (the “Registration Rights Agreement”) among the Company, the Guarantors and the Purchasers of the Second Lien Notes, of even date herewith.

Concurrently with the issuance of the Second Lien Notes, (i) the Company will be issuing $225.0 million of First Lien Senior Secured Notes due 2016 (the “First Lien Notes”), which will be guaranteed by the Guarantors; (ii) the Company and the Guarantors will also enter into a new $100.0 million asset-based revolving loan facility (the “New ABL Facility”); and (iii) the Parent will be completing its offer (the “Exchange Offer”) to exchange (1) up to $180.0 million aggregate principal amount of 6.00% Series A Convertible Senior Secured Notes due 2017 (the “Series A Convertible Notes”), (2) up to $100.0 million aggregate principal amount of 6.00% Series B Mandatorily Convertible Senior Secured Notes (the “Series B Convertible Notes”, and,

together with the Series A Convertible Notes, the “New Convertible Notes”) and (3) up to $50.0 million of cash for any and all of the Parent’s outstanding 4.25% Convertible Senior Notes due 2012 (the “Existing Convertible Notes”). On September 13, 2011, Parent and certain of its subsidiaries entered into a Second Lien Term Loan Facility (the “Second Lien Term Loan Facility”) with funds and/or accounts managed or advised by Troob Capital Management, Post Advisory Group, LLC, Bean Point Capital Management LP, Western Asset Management Company, Caspian Capital LP, Archview Investment Group LP and Logan Circle Partners, L.P. (collectively, the “Bridge Lenders”), under which the Bridge Lenders provided $25.0 million aggregate principal amount of term loans (the “Bridge Loans”).

Collectively, the following are referred to herein as the “Transaction Documents”: (i) this Agreement and the other purchase agreements relating to the issuance and sale of the Second Lien Notes (collectively, the “Second Lien NPAs”), (ii) the Indenture, (iii) the Second Lien Notes and the associated Note Guarantees, (iv) the Registration Rights Agreement, (v) the Security Agreement, (vi) the purchase agreements relating to the issuance and sale of the First Lien Notes (collectively, the “First Lien NPAs”), (vii) the indenture governing the First Lien Notes, (viii) the First Lien Notes and the associated guarantees, (ix) the registration rights agreement relating to the First Lien Notes, (x) the pledge and security agreement relating to the First Lien Notes, (xi) the indenture governing the New Convertible Notes, (xii) the New Convertible Notes and the associated guarantees, (xiii) the registration rights agreement relating to the New Convertible Notes, (xiv) the common stock of Parent, par value $0.01 per share (the “Common Stock”) to be issued in the Exchange Offer, (xv) the warrants to be issued in the Exchange Offer and upon conversion of the New Convertible Notes (the “Warrants’), (xvi) the warrant agreement governing the Warrants between the Parent and the warrant agent thereunder, (xvii) the pledge and security agreement relating to the New Convertible Notes, (xviii) the agreement governing the New ABL Facility and all guarantee, pledge and security agreements associated therewith and (xix) the intercreditor agreement among the Company, the Guarantors, the agent under the New ABL Facility, the Trustee (as collateral agent with respect to the Second Lien Notes), the collateral agent with respect to the First Lien Notes and the collateral agent with respect to the Convertible Notes (the “Intercreditor Agreement”), in each case, of even date herewith. Collectively, the transactions contemplated by the Transaction Documents (including, without limitation, the use of proceeds therefrom) and the Exchange Offer are referred to herein as the “Transactions”. Collectively, items (iv), (ix) and (xiii) are referred to herein as the “Registration Rights Agreements”.

1. Purchase of the Second Lien Notes. The Company and the Guarantors, jointly and severally hereby agree, on the basis of the representations, warranties, covenants and agreements of the Purchaser contained herein and subject to all the terms and conditions set forth herein, to issue and sell to the Purchaser and, upon the basis of the representations, warranties and agreements of the Company and the Guarantors herein contained and subject to all the terms and conditions set forth herein, the Purchaser agrees, to purchase from the Company the aggregate principal amount of Second Lien Notes that is indicated on the signature page of the Purchaser hereto for total consideration, consisting of (i) the principal amount of Bridge Loans under the Second Lien Term Loan Facility indicated on the Company’s and the Guarantors’ signature page hereto (the “Discharged Loans”) and (ii) the amount of cash indicated on the Company’s and the Guarantors’ signature page hereto. The aggregate principal amount of the Discharged Loans shall be deemed repaid and discharged as of the time the transactions contemplated by this Agreement have been consummated.

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2. Payment for and Delivery of the Second Lien Notes. Subject to the satisfaction or waiver of the conditions set forth in Section 6 below, the closing (the “Closing”) of the purchase and sale of the Second Lien Notes shall occur at 9:00 a.m., New York City time, on the date hereof. The Closing will be held at the offices of Paul, Weiss, Rifkind, Wharton & Garrison LLP, New York, New York, or at such other location as the Company and the Purchaser may otherwise agree. The date hereof is referred to herein as the “Closing Date.”

The Second Lien Notes will be delivered to the Purchaser, or the Trustee as custodian for The Depository Trust Company (“DTC”), against payment by or on behalf of the Purchaser of the purchase price therefor by wire transfer in immediately available funds, by causing DTC to credit the Second Lien Notes to the account of the Purchaser at DTC designated in Annex 1 hereto. The Second Lien Notes will be evidenced by one or more global securities in definitive form and will be registered in the name of Cede & Co. as nominee of DTC.

3. Representations, Warranties and Agreements of the Company and the Guarantors. Each of the Company and the Guarantors, jointly and severally, represent, warrant and agree, on and as of the date hereof, as follows:

(a) The Registration Statement of the Parent on Form S-4, relating to the Exchange Offer, as filed with the Securities and Exchange Commission (the “Commission”) on August 26, 2011, as amended on September 19, 2011, September 22, 2011, September 26, 2011 and September 29, 2011 (as so amended, the “Registration Statement”), together with the form of Indenture attached hereto as Exhibit I, the form of Security Agreement attached hereto as Exhibit II, the form of Intercreditor Agreement attached hereto as Exhibit III and the form of Registration Rights Agreement attached hereto as Exhibit IV hereto, (collectively, the “Disclosure Package”), contains all the information specified in, and meeting the requirements of, Rule 144A(d)(4) under the Securities Act of 1933 (the “Securities Act”). The Registration Statement was declared effective by the Commission on October 3, 2011.

(b) The Second Lien Notes and Note Guarantees are not of the same class (within the meaning of Rule 144A under the Securities Act) as securities of the Company or the Guarantors that are listed on a national securities exchange registered under Section 6 of the Exchange Act or that are quoted in a United States automated inter-dealer quotation system.

(c) None of the Company or the Guarantors is, and after giving effect to the Transactions, as described under “Unaudited Pro Forma Condensed Combined Financial Information” in the Disclosure Package, will be, an “investment company” or a company “controlled” by an “investment company” within the meaning of the Investment Company Act and the rules and regulations of the Commission thereunder.

(d) The offer and sale of the Second Lien Notes pursuant hereto is exempt from the registration requirements of the Securities Act. No form of general solicitation or general advertising within the meaning of Regulation D under the Securities Act (including,

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but not limited to, advertisements, articles, notices or other communications published in any newspaper, magazine or similar medium or broadcast over television or radio, or any seminar or meeting whose attendees have been invited by any general solicitation or general advertising) was used by the Company or the Guarantors, any of their respective Affiliates or any of their representatives in connection with the offer and sale of the Second Lien Notes.

(e) No directed selling efforts within the meaning of Rule 902 under the Securities Act were used by the Company, the Guarantors or any of their respective representatives with respect to Second Lien Notes sold outside the United States to non-U.S. persons, and the Company and the Guarantors and any of their respective Affiliates and any person acting on their behalf has complied with and will implement the “offering restrictions” required by Rule 902 under the Securities Act.

(f) The Disclosure Package has been prepared by the Company, the Parent and the other Guarantors for use in connection with the issuance of the Second Lien Notes. No other materials have been prepared by the Company, the Parent or the other Guarantors for use in connection with the issuance of the Second Lien Notes. No order or decree preventing the use of the Disclosure Package, or any order asserting that the Transactions are subject to the registration requirements of the Securities Act has been issued, and no proceeding for that purpose has commenced or is pending or, to the knowledge of the Company or the Guarantors, is contemplated.

(g) As of the date hereof, the Disclosure Package does not contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading.

(h) The statistical and market-related data included in the Disclosure Package are based on or derived from sources that the Company and the Guarantors believe to be reliable in all material respects.

(i) Each of the Company and the Guarantors and their respective subsidiaries has been duly organized, is validly existing and in good standing as a limited liability company or corporation, as applicable, under the laws of its jurisdiction of organization and is duly qualified to do business and in good standing as a limited liability company or corporation, as applicable, in each jurisdiction in which its ownership or lease of property or the conduct of its businesses requires such qualification, except where the failure to be so qualified or in good standing would not, in the aggregate, reasonably be expected to have (i) a material adverse effect on the condition (financial or otherwise), results of operations, stockholders’ equity, properties, business or prospects of the Company and the Guarantors, taken as a whole or (ii) a material adverse effect on the performance by the Company and the Guarantors of this Agreement or any of the Transaction Documents (as defined below) or the consummation of any of the transactions contemplated hereby or thereby (the events described in clauses (i) and (ii), collectively, a “Purchase Agreement Material Adverse Effect”); each of the Company, the Guarantors and their respective subsidiaries has all power and authority necessary to own or hold its properties and to conduct the businesses in which it is engaged. The Company and the Guarantors do not own or control, directly or indirectly, any corporation,

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association or other entity other than the subsidiaries listed on Exhibit V hereto. None of the subsidiaries of the Company or any of the Guarantors (other than as identified as such in Exhibit V) is a “significant subsidiary” (as defined in Rule 405 under the Securities Act).

(j) The Parent has the authorized capitalization as set forth in the Disclosure Package, and all of the issued and outstanding shares of capital stock of the Parent have been duly authorized and validly issued and are fully paid and non-assessable.

(k) All of the issued and outstanding equity interests of the Company are directly or indirectly owned by Horizon Lines Holding Corp. and have been duly authorized and validly issued, are fully paid and non-assessable and are owned of record by one or more of the Other Guarantors, free and clear of all Liens other than those imposed in connection with the Transactions. All of the issued and outstanding shares of capital stock or equity interests (as the case may be) of Hawaii Stevedores, Inc., Horizon Lines Holding Corp., Horizon Lines of Puerto Rico, Inc., Horizon Lines of Alaska, LLC, Horizon Lines of Guam, LLC, Horizon Lines Vessels, LLC, H-L Distribution Service, LLC, Horizon Logistics, LLC, Aero Logistics, LLC, Sea-Logix, LLC and Horizon Services Group, LLC (together, the “Other Guarantors”), have been duly authorized and validly issued, are fully paid and non-assessable and are owned of record by one or more of the Other Guarantors, free and clear of all Liens other than those imposed in connection with the Transactions.

(l) Each of the Company and the Guarantors has all requisite limited liability company or corporate power, as applicable, and authority to execute, deliver and perform its obligations under the Indenture. The Indenture has been duly and validly authorized by each of the Company and the Guarantors and upon its execution and delivery and constitutes the valid and binding agreement of each of the Company and the Guarantors, enforceable against it in accordance with its terms, except as such enforceability may be limited by bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium, and other laws relating to or affecting creditors’ rights generally and by general equitable principles (regardless of whether such enforceability is considered in a proceeding in equity or at law). No qualification of the Indenture under the Trust Indenture Act of 1939 (the “Trust Indenture Act”) is required in connection with the offer and sale of the Second Lien Notes in the manner contemplated hereby.

(m) The Company has all requisite limited liability company power and authority to execute, issue, sell and perform its obligations under the Second Lien Notes. The Second Lien Notes have been duly authorized by the Company and, when duly executed by the Company in accordance with the terms of the Indenture, assuming due authentication of the Second Lien Notes by the Trustee, upon delivery to the Purchaser against payment therefor in accordance with the terms hereof, will be validly issued and delivered and will constitute valid and binding obligations of the Company entitled to the benefits of the Indenture, enforceable against the Company in accordance with their terms, except as such enforceability may be limited by bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium, and other laws relating to or affecting creditors’ rights generally and by general equitable principles (regardless of whether such enforceability is considered in a proceeding in equity or at law).

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(n) Each of the Company and the Guarantors has all requisite limited liability company or corporate power, as applicable, and authority to execute, deliver and perform its obligations under the Security Agreement. The Security Agreement has been duly and validly authorized by each of the Company and the Guarantors and upon its execution and delivery and constitutes the valid and binding agreement of each of the Company and the Guarantors, enforceable against it in accordance with its terms, except as such enforceability may be limited by bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium, and other laws relating to or affecting creditors’ rights generally and by general equitable principles (regardless of whether such enforceability is considered in a proceeding in equity or at law).

(o) Each of the Company and the Guarantors has all requisite limited liability company or corporate power, as applicable, and authority to execute, deliver and perform its obligations under the Intercreditor Agreement. The Intercreditor Agreement has been duly and validly authorized by each of the Company and the Guarantors and upon its execution and delivery and constitutes the valid and binding agreement of each of the Company and the Guarantors, enforceable against it in accordance with its terms, except as such enforceability may be limited by bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium, and other laws relating to or affecting creditors’ rights generally and by general equitable principles (regardless of whether such enforceability is considered in a proceeding in equity or at law).

(p) Each of the Company and the Guarantors has all requisite limited liability company or corporate power, as applicable, and authority to execute, deliver and perform its obligations under the Registration Rights Agreement. The Registration Rights Agreement has been duly and validly authorized by each of the Company and the Guarantors and upon its execution and delivery and constitutes the valid and binding agreement of each of the Company and the Guarantors, enforceable against it in accordance with its terms, except (i) as such enforceability may be limited by bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium, and other laws relating to or affecting creditors’ rights generally and by general equitable principles (regardless of whether such enforceability is considered in a proceeding in equity or at law) and (ii) as any indemnification provisions contained therein relating to securities law liabilities may be unenforceable.

(q) Each of the Guarantors has all requisite corporate or limited liability company power and authority, as applicable, to execute, issue, sell and perform its obligations under the Note Guarantees and the related Notation of Guarantee. The Note Guarantees and Notations of Guarantee have been duly authorized by the Guarantors and, when duly executed by the Guarantors in accordance with the terms of the Indenture will constitute valid and binding obligations of each of the Guarantors entitled to the benefits of the Indenture, enforceable against each of the Guarantors in accordance with their terms, except as such enforceability may be limited by bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium, and other laws relating to or affecting creditors’ rights generally and by general equitable principles (regardless of whether such enforceability is considered in a proceeding in equity or at law).

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(r) Each of the Company, the Guarantors and their respective subsidiaries, as applicable, has all requisite limited liability or corporate power and authority, as applicable, to execute, deliver and perform its obligations under each Transaction Document (other than the Second Lien NPAs, the Indenture, the Second Lien Notes, the Note Guarantees, the Notations of Guarantee, the Security Agreement, the Intercreditor Agreement, the Registration Rights Agreement and the First Lien NPAs) to which it is a party. Each such Transaction Document has been duly and validly authorized by each of the Company and the Guarantors (to the extent a party thereto), and will be validly executed and delivered and (assuming the due authorization, execution and delivery thereof by any other parties thereto other than the Company and the Guarantors) will constitute the valid and binding obligation of each of the Company and the Guarantors (to the extent a party thereto), in accordance with the terms thereof, enforceable against it in accordance with its terms, except (i) as such enforceability may be limited by bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium and other similar laws relating to or affecting creditors’ rights generally, by general equitable principles (regardless of whether such enforceability is considered in a proceeding in equity or at law) and, as to rights of indemnification and contribution with respect to liabilities under securities laws, by principles of public policy and (ii) as any indemnification provisions contained therein relating to securities law liabilities may be unenforceable. To the extent described in the Disclosure Package, each Transaction Document conforms in all material respects to the description thereof in the Disclosure Package.

(s) Each of the Company and each of the Guarantors has all requisite limited liability or corporate power and authority, as applicable, to execute, deliver and perform its obligations under this Agreement, the other Second Lien NPAs and the First Lien NPAs. This Agreement, the other Second Lien NPAs and the First Lien NPAs have been duly and validly authorized, executed and delivered by the Company and each of the Guarantors.

(t) The Transactions will not (i) conflict with or result in a breach or violation of any of the terms or provisions of, impose any lien, charge or encumbrance upon any property or assets of the Company, the Guarantors or their respective subsidiaries, or constitute a default under, any indenture, mortgage, deed of trust, loan agreement, license, lease or other agreement or instrument to which the Company, the Guarantors or any of their respective subsidiaries is a party or by which the Company, the Guarantors or any of their respective subsidiaries is bound or to which any of the property or assets of the Company, the Guarantors or any of their respective subsidiaries is subject, except for Liens created by the Transaction Documents, (ii) result in any violation of the provisions of the certificate of formation, limited liability company agreement, charter or by-laws (or similar organizational documents) of any of the Company, the Guarantors or any of their respective subsidiaries or (iii) result in any violation of any statute or any judgment, order, decree, rule or regulation of any court or governmental agency or body having jurisdiction over any of the Company, the Guarantors or any of their respective subsidiaries or any of their properties or assets, except, with respect to clauses (i) and (iii) above, where any such matters would not, individually or in the aggregate, have a Purchase Agreement Material Adverse Effect.

(u) No consent, approval, authorization or order of, or filing, registration or qualification with any court or governmental agency or body having jurisdiction over any of the Company, the Guarantors or any of their respective subsidiaries and properties or assets is

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required for the execution, delivery and performance by the Company and the Guarantors, to the extent a party thereto, of the Transaction Documents or the completion of the Transactions, except in connection with the registration process contemplated by the Registration Rights Agreements.

(v) Other than pursuant to the Registration Statement and other than the Registration Rights Agreements, there are no contracts, agreements or understandings between any of the Company and the Guarantors and any person, granting such person the right to require the Company or the Guarantors to file a registration statement under the Securities Act with respect to any securities of the Company or the Guarantors owned or to be owned by such person.

(w) None of the Company, the Guarantors nor any other person acting on behalf of the Company or the Guarantors has sold or issued any securities that would be integrated with the offering of the Second Lien Notes contemplated by this Agreement pursuant to the Securities Act, the rules and regulations thereunder or the interpretations thereof by the Commission. The Company and the Guarantors will take reasonable precautions designed to insure that any offer or sale, direct or indirect, in the United States or to any U.S. person (as defined in Rule 902 under the Securities Act), of any Second Lien Notes or any substantially similar security issued by the Company or the Guarantors, within six months subsequent to the date hereof, is made under restrictions and other circumstances reasonably designed not to affect the status of the offer and sale of the Second Lien Notes in the United States and to U.S. persons contemplated by this Agreement as transactions exempt from the registration provisions of the Securities Act, including any sales pursuant to Rule 144A under, or Regulation S of, the Securities Act.

(x) Since the date of the latest audited financial statements of the Parent included in the Disclosure Package and except as disclosed in the Disclosure Package, none of the Company, the Guarantors or any of their respective subsidiaries has (i) sustained any loss or interference with its business from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor disturbance or dispute or court or governmental action, order or decree, (ii) issued or granted any securities, (iii) incurred any liability or obligation, direct or contingent, other than liabilities and obligations that were incurred in the ordinary course of business, that is material to the Company and its subsidiaries, taken as a whole, (iv) entered into any transaction not in the ordinary course of business, that is material to the Company and its subsidiaries, taken as a whole, (v) declared or paid any dividend on its capital stock, and (vi) since such date, there has not been any change in the capital stock or limited liability interests, as applicable, or long-term debt of any of the Company, the Guarantors or any of their respective subsidiaries or any adverse change, or any development involving a prospective adverse change, in or affecting the condition (financial or otherwise), results of operations, stockholders’ equity or limited liability company interests, as applicable, properties, management, business or prospects of any of the Company, the Guarantors or their respective subsidiaries, in each case except as would not, in the aggregate, reasonably be expected to have a Purchase Agreement Material Adverse Effect and except, in the case of clauses (ii), (iii), (iv) and (vi), pursuant to the Transactions.

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(y) Except as disclosed in the Disclosure Package, there are no judicial, administrative, legal or governmental proceedings (including any notice of violation or alleged violation) pending to which any of the Company, the Guarantors or any of their respective subsidiaries is a party or of which any property or assets of the Company, the Guarantors or any of their respective subsidiaries is the subject that would, in the aggregate, reasonably be expected to have a Purchase Agreement Material Adverse Effect. To the Company’s and the Guarantors’ knowledge, no such proceedings are threatened or contemplated by governmental authorities or others.

(z) Except as would not reasonably be expected to have a Purchase Agreement Material Adverse Effect:

(i) The facilities and properties owned, leased or operated by the Company and the Guarantors or any of their subsidiaries (the “Properties”) do not contain any gasoline or petroleum (including crude oil or any fraction thereof) or petroleum products or any hazardous or toxic substances, materials or wastes, defined or regulated as such in or under any Environmental Law (as defined below), including, without limitation, asbestos, perchlorate, polychlorinated biphenyls and urea-formaldehyde insulation (“Materials of Environmental Concern”) in amounts or concentrations which (i) constitute a violation of, or (ii) could reasonably be expected to give rise to liability on behalf of any of the Company or the Guarantors under, any and all applicable foreign, federal, state, local or municipal laws, rules, orders, regulations, statutes, ordinances, codes, decrees, requirements of the government of the United States of America or any other nation, or of any political subdivision thereof, whether state or local (including common law) regulating, relating to or imposing liability or standards of conduct concerning protection of (i) human health from exposure to any Materials of Environmental Concern or (ii) the environment, as now or may at any time be in effect during the term of this Agreement (“Environmental Law”);

(ii) The Properties, including any vessel owned, bareboat chartered or operated by the Company or the Guarantors and their respective subsidiaries other than Vessels owned by an entity other than the Company and the Guarantors and which are managed under Vessel management agreements, (the “Vessels”), and all operations of the Company and the Guarantors and/or their respective subsidiaries at the Properties or respecting the Vessels are in compliance, and have in the last five years been in compliance, with all applicable Environmental Laws, and there is no contamination at, under or about the Properties or violation of any Environmental Law with respect to the Properties, including the Vessels, or the business operated by the Company, the Guarantors or any of their subsidiaries (the “Business”);

(iii) Materials of Environmental Concern have not been transported or disposed of from the Properties, including the Vessels, in violation of, or in a manner or to a location that could reasonably be expected to give rise to liability on behalf of the Company or the Guarantors under any Environmental Law, and no Materials of Environmental Concern have been generated, treated, stored or disposed of at, on or under any of the Properties or from the Vessels in violation of, or in a manner that could reasonably be expected to give rise to liability on behalf of the Company or the Guarantors under, any applicable Environmental Law; and

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(iv) there has been no release or threat of release of Materials of Environmental Concern at or from the Properties, including the Vessels, or arising from or related to the operations of the Company or the Guarantors or any Subsidiary in connection with the Properties, including the Vessels, or otherwise in connection with the Business, in violation of or in amounts or in a manner that could reasonably be expected to give rise to liability on behalf of the Company or the Guarantors under Environmental Laws.

(aa) (i) Each “employee benefit plan” (within the meaning of Section 3(3) of the Employee Retirement Security Act of 1974, as amended (“ERISA”) and whether or not subject to ERISA) that is or, in the past six years has been maintained, administered or contributed to, or has had any obligation to contribute to, by any of the Company, the Guarantors or any member of the respective Controlled Group (each a “Plan”), has been maintained in compliance with its terms and with the requirements of all applicable statutes, rules and regulations including ERISA and the Code; (ii) no prohibited transaction, within the meaning of Section 406 of ERISA or Section 4975 of the Code, has occurred with respect to any Plan excluding transactions effected pursuant to a statutory or administrative exemption; (iii) no Plan is or was subject to Title IV of ERISA or is or was a Multiemployer Plan; (iv) each Plan that is intended to be qualified under Section 401(a) of the Code is so qualified and nothing has occurred, whether by action or by failure to act, which would cause the loss of such qualification; and (v) none of the Company or the Guarantors or a member of a Controlled Group under any of them has any material liability with regards to any post-retirement welfare benefit under a Plan other than as required by Part 6 of Subtitle B of Title I of ERISA or similar required continuation of coverage law.

(bb) The Parent. and each of its subsidiaries maintains a system of internal control over financial reporting (as such term is defined in Rule 13a-15(f) of the Exchange Act) that complies with the requirements of the Exchange Act and that has been designed by, or under the supervision of, the Parent’s principal executive and principal financial officers, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles in the United States. The Parent, and each of its subsidiaries maintains internal accounting controls sufficient to provide reasonable assurances regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles in the United States, including, but not limited to, internal accounting controls sufficient to provide reasonable assurance that (i) transactions are executed in accordance with management’s general or specific authorization, (ii) transactions are recorded as necessary to permit preparation of the relevant entity’s financial statements in conformity with accounting principles generally accepted in the United States and to maintain accountability for its assets, (iii) access to the relevant entity’s assets is permitted only in accordance with management’s general or specific authorization, and (iv) the recorded accountability for the relevant entity’s assets is compared with existing assets at reasonable intervals and appropriate action is taken with respect to any differences. As of the date of the most recent consolidated balance sheet of the Parent, reviewed or audited by Ernst & Young LLP, there were no material weaknesses in any of the Parent’s or its subsidiaries’ internal control over financial reporting.

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(cc) After giving effect to the Transactions (including, without limitation, the retirement of existing indebtedness and the related agreements contemplated thereby), none of the Company, the Guarantors or any of their respective subsidiaries (i) is in violation of its certificate of formation, limited liability company agreement, charter or by-laws (or similar organizational documents), (ii) is in default, and no event has occurred that, with notice or lapse of time or both, would constitute such a default, in the due performance or observance of any term, covenant, condition or other obligation contained in any indenture, mortgage, deed of trust, loan agreement, license or other agreement or instrument to which it is a party or by which it is bound or to which any of its properties or assets is subject, or (iii) is in violation of any statute or any order, rule or regulation of any court or governmental agency or body having jurisdiction over it or its property or assets or has failed to obtain any license, permit, certificate, franchise or other governmental authorization or permit necessary to the ownership of its property or to the conduct of its business, except in the case of clauses (ii) and (iii), to the extent any such conflict, breach, violation, failure or default would not, individually or in the aggregate, have a Purchase Agreement Material Adverse Effect.

(dd) None of the Parent, the Company, the other Guarantors or any of their respective subsidiaries, nor, to the knowledge of the Parent, the Company or the other Guarantors, any director, officer, manager, member, agent, employee or other person associated with or acting on behalf of the Parent, the Company, the other Guarantors or any of their respective subsidiaries, has (i) used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expense relating to political activity; (ii) made any direct or indirect unlawful payment to any foreign or domestic government official or employee from corporate funds; (iii) violated or is in violation of any provision of the Foreign Corrupt Practices Act of 1977; or (iv) made any bribe, rebate, payoff, influence payment, kickback or other unlawful payment.

(ee) None of the Transactions will violate or result in a violation of Regulations T, U and X of the Board of Governors of the Federal Reserve System.

(ff) The Parent, the Company and the other Guarantors and their respective Affiliates have not taken, directly or indirectly, any action designed to or that has constituted or that would reasonably be expected to cause or result in the stabilization or manipulation of the price of the First Lien Notes, the Second Lien Notes, the New Convertible Notes, the Existing Convertible Notes or the common stock of the Parent.

(gg) (i) The Parent and its subsidiaries maintains “disclosure controls and procedures” (as such term is defined in Rule 13a-15(e) under the Exchange Act), (ii) such disclosure controls and procedures are designed to ensure that the information required to be disclosed by the Parent and its subsidiaries in the reports they file or submit under the Exchange Act is accumulated and communicated to management of the Parent and its subsidiaries, including their respective principal executive officers and principal financial officers, as appropriate, to allow timely decisions regarding required disclosure to be made; and (iii) such disclosure controls and procedures are effective in all material respects to perform the functions for which they were established.

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(hh) Except as disclosed in the Disclosure Package, since the date of the most recent balance sheet of the Company and the Parent and their respective consolidated subsidiaries included in the Disclosure Package, (i) the Company and the Parent have not been advised of or become aware of (A) any significant deficiencies in the design or operation of internal control over financial reporting, that could adversely affect the ability of the Company, the Parent or any of their respective subsidiaries to record, process, summarize and report financial data, or any material weaknesses in internal control over financial reporting, and (B) any fraud, whether or not material, that involves management or other employees who have a significant role in the internal control over financial reporting of any of the Company, the Parent and each of their respective subsidiaries; and (ii) there have been no significant changes in internal control over financial reporting or in other factors that could significantly affect internal control over financial reporting, including any corrective actions with regard to significant deficiencies and material weaknesses.

(ii) After giving effect to the Transactions (including, without limitation, the retirement of existing indebtedness and the related agreements contemplated thereby), the Company and each Guarantor owns and has good title to its “Collateral” (as defined in Exhibit I hereto), free and clear of all “Liens” (as defined in Exhibit I hereto) other than “Permitted Liens” (as defined in Exhibit I hereto). The Liens granted under the Indenture and the Security Agreement (the “Second Lien Note Liens”) will constitute valid and continuing Liens on the Collateral in favor of the Trustee on behalf of and for the benefit of the holders of the First Lien Notes, which Liens on the Collateral (1) will have been perfected (as described in, and subject to any exceptions to be set forth in the Disclosure Package) (2) will have the priority set forth in the Disclosure Package, and (3) will be enforceable as such as against creditors of and purchasers from the Company and each Guarantor in accordance with its terms, except as such enforceability may be limited by bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium, and other laws relating to or affecting creditors’ rights generally and by general equitable principles (regardless of whether such enforceability is considered in a proceeding in equity or at law). The Company and the Guarantors will have received all consents and approvals required by the terms of the Security Agreement to the pledge of the Collateral to the Trustee under the Indenture and under the Security Agreement. As of the Closing Date, all action necessary to perfect the Second Lien Note Liens will have been duly taken.

(jj) After giving effect to the Transactions (including, without limitation, the retirement of existing indebtedness and the related agreements contemplated thereby), other than Liens granted pursuant to the Transaction Documents and Permitted Liens, none of the Company or the Guarantors have pledged, assigned, sold or granted a security interest in the Collateral. All actions necessary (including the filing of UCC-1 financing statements and filings with the United States Patent and Trademark Office, the United States Copyright Office or any applicable foreign intellectual property office or agency) to protect and evidence the Trustee’s Liens in the Collateral will have been duly and effectively taken by the Company and the Guarantors (as described in, and subject to any exceptions to be set forth in the Security Agreement). After giving effect to the Transactions (including, without limitation, the retirement of existing indebtedness and the related agreements contemplated thereby), no security agreement, financing statement, equivalent security or Lien instrument or continuation statement authorized by the Company or any Guarantor and listing the Company or any

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Guarantor as debtor covering all or any part of the Collateral shall be on file or of record in any jurisdiction, except in respect of Permitted Liens or such as may have been filed, recorded or made as contemplated by the Transaction Documents.

(kk) The historical financial statements (including the related notes and supporting schedules) included in Disclosure Package present fairly in all material respects the financial condition, results of operations and cash flows of the entities purported to be shown thereby, at the dates and for the periods indicated, and have been prepared in conformity with accounting principles generally accepted in the United States applied on a consistent basis throughout the periods involved.

(ll) The pro forma financial statements included in the Disclosure Package include assumptions that provide a reasonable basis for presenting the significant effects directly attributable to the Transactions, and the related pro forma adjustments give appropriate effect to those assumptions. The pro forma financial statements included in the Disclosure Package have been prepared in accordance with the Commission’s rules and guidance with respect to pro forma financial information. The pro forma financial statements set forth in the Disclosure Package have been prepared on the basis consistent with such historical financial statements, include all material adjustments to the historical financial data required by Rule 11-02 of Regulation S-X to reflect the Transactions, and give effect to assumptions made on a reasonable basis and in good faith present fairly in all material respects the Transactions.

(mm) No labor disturbance by or dispute with the employees of the Parent or any of its subsidiaries exists or, to the knowledge of the Parent or such subsidiaries, is imminent that would reasonably be expected to have a Purchase Agreement Material Adverse Effect.

(nn) Except as disclosed in the Disclosure Package, there is and has been no material failure on the part of the Company or the Guarantors, to the extent applicable, or any of the Company’s or the Guarantors’ directors or officers, in their capacities as such, to comply with any provision of the Sarbanes-Oxley Act of 2002 and the rules and regulations promulgated in connection therewith.

(oo) The operations of the Company, the Guarantors and their respective subsidiaries are and have been conducted at all times in compliance with applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, the money laundering statutes of all jurisdictions, the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any governmental agency (collectively, the “Money Laundering Laws”) and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company, the Guarantors or any of their respective subsidiaries with respect to the Money Laundering Laws is pending or, to the knowledge of the Company or the Guarantors, threatened.

(pp) None of the Company, the Guarantors or any of their respective subsidiaries nor, to the knowledge of any of the Company or the Guarantors, any director, officer, manager, member, agent, employee or affiliate of any of the Company, the Guarantors

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or any of their respective subsidiaries is currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury Department (“OFAC”); and the Company and the Guarantors will not directly or indirectly use the proceeds of the offering of the First Lien Notes, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other person or entity, for the purpose of financing the activities of any person currently subject to any U.S. sanctions administered by OFAC.

(qq) Immediately after the consummation of the Transactions, each of the Company and the Guarantors will be Solvent. As used in this paragraph, the term “Solvent” means, with respect to a particular date, that on such date (i) the present fair market value (or present fair saleable value) of the assets of the relevant entity are not less than the total amount required to pay the probable liabilities of such entity on its total existing debts and liabilities (including contingent liabilities) as they become absolute and matured, (ii) the relevant entity is able to realize upon its assets and pay its debts and other liabilities, contingent obligations and commitments as they mature and become due in the normal course of business, (iii) assuming the completion of the transactions contemplated by the Transaction Documents, the relevant entity is not incurring debts or liabilities beyond its ability to pay as such debts and liabilities mature, (iv) the relevant entity is not engaged in any business or transaction, and is not about to engage in any business or transaction, for which its property would constitute unreasonably small capital after giving due consideration to the prevailing practice in the industry in which such entity is engaged, and (v) the relevant entity is not a defendant in any civil action that is reasonably expected to result in a judgment that such entity is or would become unable to satisfy. In computing the amount of such contingent liabilities at any time, it is intended that such liabilities will be computed at the amount that, in the light of all the facts and circumstances existing at such time, represents the amount that can reasonably be expected to become an actual or matured liability.

(rr) None of the Company or the Guarantors is a party to any contract, agreement or understanding with any person that would give rise to a valid claim against any of them or the Purchaser for a brokerage commission, finder’s fee or like payment in connection with the Transactions.

Any certificate signed by any officer of the Company and delivered to the Purchaser or counsel for the Purchaser in connection with the offering of the First Lien Notes shall be deemed a representation and warranty by the Company, as to matters covered thereby, to the Purchaser, and not a representation or warranty by the individual officer.

Any certificate signed by any officer of any of the Guarantors and delivered to the Purchaser or counsel for the Purchaser in connection with the offering of the First Lien Notes shall be deemed a representation and warranty by such Guarantor, as to matters covered thereby, to the Purchaser, and not a representation or warranty by the individual officer.

4. Representations, Warranties and Agreements of the Purchaser. The Purchaser hereby represents and warrants to the Company and the Guarantors as follows (it being understood that the Purchaser does not make any representation, warranty, covenant or agreement to any other purchaser of Second Lien Notes or to the Company or the Guarantors on behalf of any other purchaser of the Second Lien Notes):

(a) The Purchaser (i) is knowledgeable, sophisticated and experienced in making, and is qualified to make, decisions with respect to investments in securities representing an investment decision like that involved in the purchase of the Second Lien Notes, and has requested, received, reviewed and considered all information it deems relevant in making an informed decision to purchase the Second Lien Notes; (ii) is acquiring the Second Lien Notes in the ordinary course of its business and for its own account for investment purposes only and with no present intention of distributing any of such Second Lien Notes or any arrangement or understanding with any other persons regarding the distribution of such Second Lien Notes; and (iii) will not, directly or indirectly, offer, sell, pledge, transfer or otherwise dispose of (or solicit any offers to buy, purchase or otherwise acquire or take a pledge of) any of the Second Lien Notes except in compliance with the Securities Act and any applicable state securities laws.

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(b) The Purchaser is a “qualified institutional buyer” (as defined in Rule 144A under the Securities Act.

(c) The Purchaser understands and acknowledges that (i) the Second Lien Notes are being offered in transactions not involving any public offering within the meaning of the Securities Act; (ii) the initial offering and issuance of the Second Lien Notes has not been registered under the Securities Act or any other securities laws, (iii) if in the future it decides to resell, pledge or otherwise transfer the Second Lien Notes that it purchases hereunder, those Second Lien Notes, absent an effective registration statement under the Securities Act, may be resold, pledged or transferred only pursuant to an applicable exemption from registration under the Securities Act in accordance with any applicable securities laws of the states and other jurisdictions of the United States, and (iv) it will, and each subsequent holder of any of the Second Lien Notes that it purchases in this offering is required to, notify any subsequent purchaser of such Second Lien Notes from it or subsequent holders, as applicable, of the resale restrictions referred to in clause (iii) above.

(d) The Purchaser understands and acknowledges that the Company and the Guarantors are relying upon the truth and accuracy of, and the Purchaser’s compliance with, the representations, warranties, agreements, acknowledgments and understanding of the Purchaser set forth herein in order to determine the availability of such exemptions and the eligibility of the Purchaser to acquire the Second Lien Notes.

(e) The Purchaser understands that the Second Lien Notes will bear a restrictive legend substantially in the following form:

“THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER SECTION 5 OF THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND THE SECURITY EVIDENCED HEREBY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THE SECURITY EVIDENCED HEREBY IS HEREBY NOTIFIED THAT

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THE SELLER MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. THE HOLDER OF THE SECURITY EVIDENCED HEREBY AGREES FOR THE BENEFIT OF THE ISSUER THAT (A) SUCH SECURITY MAY BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY (i) (a) TO A PERSON WHO IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (b) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT, (c) OUTSIDE THE UNITED STATES TO A NON-U.S. PERSON IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 904 UNDER THE SECURITIES ACT, OR (d) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND BASED UPON AN OPINION OF COUNSEL IF THE ISSUER SO REQUESTS), (ii) TO THE ISSUER, OR (iii) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN EACH CASE IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION, AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER FROM IT OF THE SECURITY EVIDENCED HEREBY OF THE RESALE RESTRICTIONS SET FORTH IN CLAUSE (A) ABOVE. NO REPRESENTATION CAN BE MADE AS TO THE AVAILABILITY OF THE EXEMPTION PROVIDED BY RULE 144 FOR RESALE OF THE SECURITY EVIDENCED HEREBY.”

(f) (i) The Purchaser has full right, power, authority and capacity to enter into this Agreement and to consummate the transactions contemplated hereby and has taken all necessary action to authorize the execution, delivery and performance of this Agreement, and (ii) the execution, delivery and performance of the Agreement by the Purchaser and the consummation of the transactions herein contemplated will not violate any provision of the organizational documents of the Purchaser or any statute or any authorization, judgment, decree, order, rule or regulation of any court or any regulatory body, administrative agency or other governmental body applicable to Purchaser.

(g) The Purchaser understands that no United States federal or state agency or any other government or governmental agency has passed upon or made any recommendation or endorsement of the Second Lien Notes or the fairness or suitability of the investment in the Second Lien Notes nor have such authorities passed upon or endorsed the merits of the offering of the Second Lien Notes.

(h) The Purchaser’s principal executive offices are in the jurisdiction set forth under the Purchaser’s signature on the signature block hereto.

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(i) The Purchaser acknowledges that the Company, the Guarantors and its counsel will rely upon the accuracy of the foregoing acknowledgments, representations and agreements. The Purchaser agrees that if any of the acknowledgments, representations or agreements that Purchaser is deemed to have made by its purchase of the Second Lien Notes is no longer accurate, it shall promptly notify the Company and the Guarantors. If the Purchaser is purchasing the Second Lien Notes as a fiduciary or agent for one or more investor accounts, the Purchaser represents that it has sole investment discretion with respect to each of those accounts and full power to make the above acknowledgments, representations and agreements on behalf of each account.

5. Agreements of the Company and the Guarantors. The Company and the Guarantors, jointly and severally, agree with the Purchaser as follows:

(a) The Company and the Guarantors will apply the net proceeds from the sale of the Second Lien Notes to be sold by the Company hereunder substantially in accordance with the description set forth in the Disclosure Package under the caption “Unaudited Pro Forma Condensed Combined Financial Information”.

(b) The Company, the Guarantors and their respective Affiliates will not take, directly or indirectly, any action designed to or that has constituted or that reasonably could be expected to cause or result in the stabilization or manipulation of the price of any security of the Company and the Guarantors in connection with the offering of the Second Lien Notes.

(c) The Second Lien Notes will be eligible for clearance and settlement in the United States through DTC and in Europe through Euroclear Bank, S.A./N.V., or Clearstream Banking, société anonyme.

(d) The Company and the Guarantors will not, and will not cause their respective Affiliates to, engage in any “directed selling efforts” within the meaning of Rule 902 under the Securities Act.

(e) The Company and the Guarantors will, and will cause their respective Affiliates to, comply with and implement the “offering restrictions” required by Rule 902 under the Securities Act with respect to the sale of the Second Lien Notes.

(f) The Company and the Guarantors agree not to sell, offer for sale or solicit offers to buy or otherwise negotiate in respect of any security (as defined in the Securities Act) that would be integrated with the sale of the Second Lien Notes in a manner that would require the registration under the Securities Act of the sale to the Purchaser of the Second Lien Notes. The Company and the Guarantors will take reasonable precautions designed to insure that any offer or sale, direct or indirect, in the United States or to any U.S. person (as defined in Rule 902 under the Securities Act) or U.S. resident (as defined in the Investment Company Act), of any Notes or any substantially similar security issued by the Company or the Guarantors, within six months subsequent to the date on which the distribution of the Second Lien Notes has been completed (as notified to the Company by the Purchaser), is made under restrictions and other circumstances reasonably designed not to affect the status of

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the offer and sale of the Second Lien Notes in the United States and to U.S. persons or U.S. residents contemplated by this Agreement as transactions exempt from the registration provisions of the Securities Act, including any sales pursuant to Rule 144A under, or Regulations D or S of, the Securities Act.

(g) The Company and the Guarantors agree to comply with all agreements set forth in the representation letters of the Company and the Guarantors to DTC relating to the approval of the First Lien Notes by DTC for “book entry” transfer.

6. Conditions to Purchaser’s Obligations. The obligations of the Purchaser hereunder are subject (i) to the accuracy of the representations and warranties of the Company and the Guarantors contained herein, (ii) to the accuracy of the statements of each of the Company, the Guarantors and each of their respective officers made in any certificate delivered pursuant hereto, (iii) to the performance by the Company and the Guarantors of their respective obligations hereunder, and (iv) to each of the following additional terms and conditions:

(a) All corporate proceedings and other legal matters incident to the authorization, form and validity of the Transaction Documents and all other legal matters relating to this Agreement and the transactions contemplated hereby shall be reasonably satisfactory in all material respects to counsel for the Purchaser, and the Company and the Guarantors shall have furnished to such counsel all documents and information that they may reasonably request to enable them to pass upon such matters.

(b) Kirkland & Ellis, LLP, special counsel to the Company and the Guarantors, shall have delivered an opinion reasonably satisfactory to the Purchaser;

(c) Carlsmith Ball LLP, special Hawaii counsel to Hawaii Stevedores, Inc., shall have delivered an opinion reasonably satisfactory to the Purchaser;

(d) The Parent shall have furnished or caused to be furnished to the Purchaser a certificate of the Chief Financial Officer of the Parent, or other officers satisfactory to the Purchaser, dated the date hereof, as to such matters as the Purchaser may reasonably request, including, without limitation, a statement that:

(i) The representations, warranties and agreements of the Company and the Guarantors, as applicable, in Section 3 herein and in any other Transaction Document to which each of the Company and any of the Guarantors, as applicable, is a party are true and correct, and the Company and the Guarantors, as applicable, has complied with all its agreements contained herein and in any other Transaction Document to which it is a party and satisfied all the conditions on its part to be performed or satisfied hereunder or thereunder;

(ii) They have carefully examined the Disclosure Package and, in their opinion, the Disclosure Package, as of the date hereof, does not contain any untrue statement of a material fact and does not omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.

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(e) The Parent shall have furnished or caused to be furnished to the Purchaser a certificate of the Parent, dated the date hereof, substantially in the form of Exhibit VI hereto.

(f) The Parent shall have furnished or caused to be furnished to the Purchaser a solvency certificate, dated the date hereof, substantially in the form of Exhibit VII hereto.

(g) The Second Lien Notes shall be eligible for clearance and settlement through DTC.

(h) The Company and the Trustee shall have executed and delivered the Indenture, and the Purchaser shall have received an original copy thereof, duly executed by the Company and the Trustee.

(i) The Second Lien Notes shall have been duly executed and delivered by the Company and duly authenticated by the Trustee.

(j) The Note Guarantees shall have been duly executed and delivered by the Guarantors.

(k) Each Notation of Guarantee shall have been duly executed and delivered by the Guarantors.

(l) Each of the Transaction Documents shall have been duly executed and delivered by the respective parties thereto (other than the Purchaser).

(m) The representations and warranties of each of the Company and the Guarantors (to the extent a party thereto) contained in the Transaction Documents to which each of the Company and any such Guarantor is a party are true and correct as of the date hereof.

(n) Second Lien Notes (in an aggregate principal amount equal to $100.0 million less the aggregate principal amount of Second Lien Notes sold hereby) shall have been sold pursuant to the other Second Lien Purchase Agreements simultaneously with the sale of the Second Lien Notes sold hereby, and the use of proceeds therefrom shall conform to the description in the Disclosure Package under “Unaudited Pro Forma Condensed Combined Financial Information”.

(o) The First Lien Notes shall have been issued, and the use of proceeds therefrom shall conform to the description in the Disclosure Package under “Unaudited Pro Forma Condensed Combined Financial Information”.

(p) All parties to the New ABL Facility shall have executed and delivered the New ABL Facility and all borrowings thereunder contemplated by the Disclosure Package shall have been made.

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(q) The Exchange Offer and the other Transactions shall have been consummated as contemplated by the Disclosure Package.

All opinions, letters, evidence and certificates mentioned above or elsewhere in this Agreement shall be deemed to be in compliance with the provisions hereof only if they are in form and substance reasonably satisfactory to counsel for the Purchaser.

7. Indemnification and Contribution.

(a) Each of the Company and the Guarantors hereby agrees, jointly and severally, to indemnify and hold harmless the Purchaser, its Affiliates, directors, officers and employees and each person, if any, who controls the Purchaser within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act, from and against any loss, claim, damage or liability, joint or several, or any action in respect thereof (including, but not limited to, any loss, claim, damage, liability or action relating to purchases and sales of Second Lien Notes), to which the Purchaser, affiliate, director, officer, employee or controlling person may become subject, under the Securities Act or otherwise, insofar as such loss, claim, damage, liability or action arises out of, or is based upon, (i) any breach by the Company or the Guarantors of any representation or warranty or material failure to comply with any of the covenants and agreements contained in this Agreement, (ii) any untrue statement or alleged untrue statement of a material fact contained (A) in the Disclosure Package or in any amendment or supplement thereto, (B) in any Blue Sky application or other document prepared or executed by the Company or the Guarantors (or based upon any written information furnished by the Company or the Guarantors) specifically for the purpose of qualifying any or all of the Second Lien Notes under the securities laws of any state or other jurisdiction (any such application, document or information being hereinafter called a “Blue Sky Application”), (iii) the omission or alleged omission to state in the Disclosure Package, or in any amendment or supplement thereto, in any Blue Sky Application, any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading or (iv) the Transactions (other than those contemplated by this Agreement) and shall reimburse the Purchaser and each such director, officer, employee or controlling person promptly upon demand for any legal or other expenses reasonably incurred by the Purchaser, affiliate, director, officer, employee or controlling person in connection with investigating or defending or preparing to defend against any such loss, claim, damage, liability or action as such expenses are incurred. The foregoing indemnity agreement is in addition to any liability that the Company and the Guarantors may otherwise have to the Purchaser or to any affiliate, director, officer, employee or controlling person of the Purchaser.

(b) Promptly after receipt by an indemnified party under this Section 7 of notice of any claim or the commencement of any action, the indemnified party shall, if a claim in respect thereof is to be made against the indemnifying party under this Section 7, notify the indemnifying party in writing of the claim or the commencement of that action; provided, however, that the failure to notify the indemnifying party shall not relieve it from any liability that it may have under this Section 7 except to the extent it has been materially prejudiced (through the forfeiture of substantive rights or defenses) by such failure and; provided, further, that the failure to notify the indemnifying party shall not relieve it from any liability that it may have to an indemnified party otherwise than under this Section 7. If any such claim or action

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shall be brought against an indemnified party, and it shall notify the indemnifying party thereof, the indemnifying party shall be entitled to participate therein and, to the extent that it wishes, jointly with any other similarly notified indemnifying party, to assume the defense thereof with counsel reasonably satisfactory to the indemnified party. After notice from the indemnifying party to the indemnified party of its election to assume the defense of such claim or action, the indemnifying party shall not be liable to the indemnified party under this Section 7 for any legal or other expenses subsequently incurred by the indemnified party in connection with the defense thereof other than reasonable costs of investigation; provided, however, that the Purchaser shall have the right to employ counsel to represent jointly the Purchaser and its directors, officers, employees and controlling persons who may be subject to liability arising out of any claim in respect of which indemnity may be sought by the Purchaser against any of the Company or the Guarantors under this Section 7, if (i) the Company, the Guarantors and the Purchaser shall have so mutually agreed; (ii) the Company and the Guarantors have failed within a reasonable time to retain counsel reasonably satisfactory to the Purchaser; (iii) the Purchaser and its respective directors, managers, officers, employees and controlling persons shall have reasonably concluded, based on the advice of counsel, that there may be legal defenses available to them that are different from or in addition to those available to the Company or the Guarantors; or (iv) the named parties in any such proceeding (including any impleaded parties) include both the Purchaser or its directors, officers, employees or controlling persons, on the one hand, and the Company or the Guarantors, on the other hand, and representation of both sets of parties by the same counsel would present a conflict due to actual or potential differing interests between them, and in any such event the fees and expenses of such separate counsel shall be paid by the Company and the Guarantors. No indemnifying party shall (x) without the prior written consent of the indemnified parties (which consent shall not be unreasonably withheld), settle or compromise or consent to the entry of any judgment with respect to any pending or threatened claim, action, suit or proceeding in respect of which indemnification or contribution may be sought hereunder (whether or not the indemnified parties are actual or potential parties to such claim or action) unless such settlement, compromise or consent includes an unconditional release of each indemnified party from all liability arising out of such claim, action, suit or proceeding and does not include a statement as to, or an admission of fault, culpability or a failure to act by or on behalf of any indemnified party, or (y) be liable for any settlement of any such action effected without its written consent (which consent shall not be unreasonably withheld), but if settled with the consent of the indemnifying party or if there be a final judgment of the plaintiff in any such action, the indemnifying party agrees to indemnify and hold harmless any indemnified party from and against any loss or liability by reason of such settlement or judgment.

(c) If the indemnification provided for in this Section 7 shall for any reason be unavailable to or insufficient to hold harmless an indemnified party under Section 7(a) in respect of any loss, claim, damage or liability, or any action in respect thereof, referred to therein, then each indemnifying party shall, in lieu of indemnifying such indemnified party, contribute to the amount paid or payable by such indemnified party as a result of such loss, claim, damage or liability, or action in respect thereof, in such proportion as shall be appropriate to reflect the relative fault of the Company and the Guarantors, on the one hand, and the Purchaser, on the other, with respect to the statements or omissions that resulted in such loss, claim, damage or liability, or action in respect thereof, as well as any other relevant equitable considerations. The relative fault shall be determined by reference to whether the

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untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact relates to information supplied by the Company and the Guarantors, or the Purchaser, the intent of the parties and their relative knowledge, access to information and opportunity to correct or prevent such statement or omission. The Company, the Guarantors and the Purchaser agree that it would not be just and equitable if contributions pursuant to this Section 7(c) were to be determined by pro rata allocation or by any other method of allocation that does not take into account the equitable considerations referred to herein. The amount paid or payable by an indemnified party as a result of the loss, claim, damage or liability, or action in respect thereof, referred to above in this Section 7 shall be deemed to include, for purposes of this Section 7 any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim.

8. Termination. The obligations of the Purchaser hereunder may be terminated by the Purchaser by notice given to and received by the Company prior to delivery of and payment for the Second Lien Notes if the Purchaser shall decline to purchase the Second Lien Notes for any reason permitted under this Agreement.

9. Notices, etc. All statements, requests, notices and agreements hereunder shall be in writing, and:

(a) if to the Purchaser, shall be delivered or sent by hand delivery, mail, telex, overnight courier or facsimile transmission to the address specified on the signature page hereto with a copy to Paul, Weiss, Rifkind, Wharton & Garrison LLP, 1285 Avenue of the Americas, New York, NY 10019, Attention: Lawrence Wee; and

(b) if to any of the Company or the Guarantors, shall be delivered or sent by mail, overnight courier or facsimile transmission to Horizon Lines, Inc. 4064 Colony Road, Suite 200, Charlotte, NC 28211, Attention: General Counsel, with a copy to Kirkland & Ellis LLP, 601 Lexington Avenue, New York, NY 10023, Attention: Christian Nagler.

10. Survival. The respective indemnities, rights of contribution, representations, warranties and agreements of the Company or the Guarantors and the Purchaser contained in this Agreement or made by or on behalf of them, respectively, pursuant to this Agreement, shall survive the delivery of and payment for the Second Lien Notes and shall remain in full force and effect, regardless of any termination of this Agreement or any investigation made by or on behalf of any of them or any person controlling any of them.

11. Definition of the Terms “Business Day”, “Affiliate”, and “Subsidiary.” For purposes of this Agreement, (a) “business day” means any day on which the New York Stock Exchange, Inc. is open for trading, and (b) “affiliate” and “subsidiary” have the meanings set forth in Rule 405 under the Securities Act.

12. Governing Law. This Agreement and any matters arising out of or in any way relating to this Agreement shall be governed by and construed in accordance with the laws of the State of New York.

13. Submission to Jurisdiction. Each of the parties hereto hereby irrevocably and unconditionally:

(a) submits for itself and its property in any legal action or proceeding relating to this Agreement or any of the transactions contemplated hereby, or for recognition and enforcement of any judgment in respect thereof, to the non-exclusive general jurisdiction of the State or Federal courts sitting in the Borough of Manhattan, the City of New York (“New York Courts”);

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(b) consents that any such action or proceeding may be brought in such New York Courts and waives any objection that it may now or hereafter have to the venue of any such action or proceeding in any such New York Court or that such action or proceeding was brought in an inconvenient court and agrees not to plead or claim the same;

(c) agrees that service of process in any such action or proceeding may be effected by mailing a copy thereof by registered or certified mail (or any substantially similar form of mail), postage prepaid, to any party hereto at its address set forth in Section 9 or at such other address of which such party shall have been notified pursuant thereto; and

(d) agrees that nothing herein shall affect the right to effect service of process in any other manner permitted by law or shall limit the right to sue in any other jurisdiction; and waives, to the maximum extent not prohibited by law, any right it may have to claim or recover in any legal action or proceeding referred to in this Section 13 any special, exemplary, punitive or consequential damages.

14. Waiver of Jury Trial. The Company, the Guarantors and the Purchaser hereby irrevocably waive, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising out of or relating to this Agreement or the transactions contemplated hereby.

15. Counterparts. This Agreement may be executed in one or more counterparts and, if executed in more than one counterpart, the executed counterparts shall each be deemed to be an original but all such counterparts shall together constitute one and the same instrument.

16. Headings. The headings herein are inserted for convenience of reference only and are not intended to be part of, or to affect the meaning or interpretation of, this Agreement.

17. Delivery of Payment. If the Company has not received payment in full for any of the Second Lien Notes purchased pursuant hereto prior to 4:00 p.m., New York City time, on October 5, 2011, upon written request by the Company, the Purchaser shall surrender to the Company for cancellation such Second Lien Notes for which payment has not been received.

23

If the foregoing correctly sets forth the agreement among the Company, the Guarantors and the Purchaser, please indicate your acceptance in the space provided for that purpose below.

HORIZON LINES, LLC
By:
	Name:
	Title:
The Company hereby acknowledges receipt of $[            ] from the Purchaser as payment for the Second Lien Notes indicated on the signature page hereto.

GUARANTORS:

HORIZON LINES, INC.

HORIZON LINES HOLDING CORP.

HAWAII STEVEDORES, INC.

HORIZON LINES OF PUERTO RICO, INC.

HORIZON LINES OF ALASKA, LLC

HORIZON LINES OF GUAM, LLC

HORIZON LINES VESSELS, LLC

H-L DISTRIBUTION SERVICE, LLC

HORIZON LOGISTICS, LLC

AERO LOGISTICS, LLC

SEA-LOGIX, LLC

HORIZON SERVICES GROUP, LLC

By:
	Name:
	Title:

[Signature Page to Note Purchase Agreement]

Accepted:

[    ]

a
	[Jurisdiction]	[Form of Entity]

on behalf of certain funds and/or accounts

it manages and/or advises

By:
	Name:
	Title:

Principal executive office of the Purchaser:

c/o [    ]

The above Purchaser hereby acknowledges receipt of $[            ] aggregate principal amount of Second Lien Notes.

[Signature Page to Note Purchase Agreement]

Annex 1

Purchaser’s DTC Account Information

Annex 1

Exhibit I

Form of Indenture for the Second Lien Notes

Exhibit II

Form of Security Agreement

3

Exhibit III

Form of Intercreditor Agreement

4

Exhibit IV

Form of Registration Rights Agreement

5

Exhibit V

List of Subsidiaries of the Company and the Guarantors

HORIZON LINES, INC.

HORIZON LINES HOLDING CORP.

HAWAII STEVEDORES, INC.

HORIZON LINES OF PUERTO RICO, INC.

HORIZON LINES OF ALASKA, LLC

HORIZON LINES OF GUAM, LLC

HORIZON LINES VESSELS, LLC

H-L DISTRIBUTION SERVICE, LLC

HORIZON LOGISTICS, LLC

AERO LOGISTICS, LLC

SEA-LOGIX, LLC

HORIZON SERVICES GROUP, LLC

6

Exhibit VI

OFFICER’S CERTIFICATE OF

HORIZON LINES, INC.

The undersigned, [                    ], does hereby certify that he is the [                    ] of Horizon Lines, Inc., a Delaware corporation (the “Company”). Reference is hereby made to the commitment letters, dated as of August 26, 2011 (each, a “Commitment Letter” and collectively, the “Commitment Letters”) by and between the Company and holders of its 4.25% convertible senior notes due in 2012 issued under the Indenture, dated as of August 8, 2007, by and between the Company, as issuer, and The Bank of New York Trust Company, N.A., as Trustee, in the aggregate principal amount of $330,000,000.00 and certain other third parties (each, a “Commitment Party” and collectively, the “Commitment Parties”).

Pursuant to Section 7 of each Commitment Letter, the funding of the commitment of each Commitment Party is subject to satisfaction of, among other things, the legal and documentary conditions described on Exhibit G to each Commitment Letter, attached hereto as Annex A.

Pursuant to Section 21 of Exhibit G of each Commitment Letter, I do hereby certify, in my capacity as such officer and not in a personal capacity, on behalf of the Company, that all of the conditions set forth in items 6, 7, 8, 10, 12, 13, 14, 16, 17, 18 and 20 of Exhibit G (to the extent such conditions do not consist of the satisfaction of or approvals of the Commitment Parties or their representatives) of each Commitment Letter have been satisfied.

[Remainder of page intentionally left blank]

7

IN WITNESS WHEREOF, the undersigned have executed this Officer’s Certificate as of this 5th day of October, 2011.

HORIZON LINES, INC.

By:

Name:

Title

8

ANNEX A

Exhibit G to Commitment Letter

Legal and Documentary Conditions

In addition to the conditions described in the body of the Commitment Letter, the obligations of each Commitment Party under the Commitment Letter to fund its Commitment with respect to the Secured Notes are subject to the satisfaction or waiver (in accordance with the “Amendments” Section thereof) of the following additional conditions precedent (capitalized terms used and not otherwise defined in this Exhibit G have the meanings given to them in the Commitment Letter or Exhibit C and D, as applicable):

18. Exchange Offer, New ABL Facility. The Exchange Offer and entry into the New ABL Facility shall be consummated pursuant to the RSAs substantially simultaneously with the purchase of the Secured Notes and no provision thereof shall have been amended or waived (and, in the case of the New ABL Facility, no consent to deviation from the requirements thereof shall have been granted by the lenders thereunder), in each case, in any material respect adverse to the Commitment Parties, solely in their capacity as providers of their respective Commitment.

19. Financing Terms. The terms of the Secured Notes, the terms and conditions of the Convertible Secured Notes and the New ABL Facility (including but not limited to terms and conditions relating to the interest rate, fees, amortization, maturity, subordination, covenants, events of default and remedies), shall be consistent in all material respects with the terms set forth herein and in the RSAs and otherwise reasonably satisfactory in all respects to the Commitment Parties.

20. Absence of Defaults. There shall not exist any default or event of default on the Closing Date under the Indenture after giving effect to the use of the proceeds of the Secured Notes. There shall not exist any default or event of default on the Closing Date under the Note Purchase Agreements.

21. Trustees. The trustee under the indenture governing the First Lien Secured Notes, the trustee under the indenture governing the Second Lien Secured Notes and the trustee under the indenture governing the Convertible Secured Notes shall not have taken action that would reasonably be expected to adversely affect (in any material respect) the consummation of any of the Transactions on the Closing Date and shall have taken no action that challenges the validity or effectiveness of the procedures used by the Company in the making the Exchange Offer or the Consent Solicitation.

22. Definitive Documentation; Customary Closing Documents. The parties shall have executed and delivered (or be willing to execute and deliver) for the First Lien Secured Notes and the Second Lien Secured Notes (a) the respective Note Purchase Agreements, containing a 10b-5 representation in connection with any transaction contemplated by the Restructuring, including the Exchange Offer, as to the information contained in the S-4 registration statement filed, and agreed upon indemnities plus other terms, consistent in all material respects with this Commitment Letter, by and among the Issuer and the other parties thereto (including a representation by each purchaser thereunder that it is either a “qualified institutional buyer” or an

9

institution that is an “accredited investor” (each as defined in the Security Act)), except that as the Commitment Parties are not underwriters, there shall be no requirement for an offering memorandum or other offering documentation beyond the documentation and information necessary to satisfy the requirements of Rule 144A(d)(4) promulgated under the Securities Act; (b) the indenture governing the First Lien Secured Notes consistent with the terms set forth in Exhibit C and otherwise containing customary terms for the First Lien Secured Notes issued in a private placement and eligible for resale on a “144A-for-life” basis; (c) the indenture governing the Second Lien Secured Notes consistent with the terms set forth in Exhibit D and otherwise containing customary terms for the Second Lien Secured Notes issued in a private placement and eligible for resale on a “144A-for-life” basis; and (d) pledge and security agreements covering the collateral for the First Lien Secured Notes and the Second Lien Secured Notes; in each of cases (a) through (d) in form and substance consistent in all material respects with this Commitment Letter and otherwise reasonably satisfactory to the Supermajority Commitment Parties and the Company (collectively, the “Definitive Documentation”); and the Commitment Parties shall have received customary closing certificates (including a solvency certificate of a financial officer as to the solvency of the Borrower and its subsidiaries, taken as a whole, after giving effect to the Transactions), customary legal opinions (for the avoidance of doubt, other than a 10b-5 letter), customary corporate documents, customary evidence of corporate authority, and customary certificates of good standing in the Loan Parties’ respective jurisdictions of formation.

23. Representations and Warranties. The representations and warranties made by the Company and its subsidiaries herein, or which are contained in any certificate furnished at any time under or in connection herewith shall (i) with respect to representations and warranties that contain a materiality qualification, be true and correct and (ii) with respect to representations and warranties that do not contain a materiality qualification, be true and correct in all material respects, in each case on and as of the Closing Date as if made on and as of such date (except for those which expressly relate to an earlier date).

24. Bankruptcy. There shall be no bankruptcy or insolvency proceedings pending with respect to the Company or any subsidiary thereof.

25. Discharge of Existing Debt. After giving effect to the Transactions, the Company and its subsidiaries shall have (A) no outstanding indebtedness other than (i) up to $280 million of Convertible Secured Notes, (ii) $325 million of Secured Notes, (iii) borrowings under the New ABL Facility; and (iv) existing Notes that have not been tendered into the Exchange Offer in an aggregate principal amount not exceeding the amount permitted to remain outstanding after the Closing Date under the terms of the RSAs; and (B) no liens in respect of borrowed money, other than liens permitted by or expressly provided for under the New ABL Facility, Bridge Loan Facility or the indentures governing the First Lien Secured Notes and the Second Lien Secured Notes and/or liens outstanding immediately prior to the Closing Date (and not securing the First Lien Facility).

26. Expenses. All expenses, including legal fees, required to be paid to the Commitment Parties under the “Expenses” section of this Commitment Letter shall have been paid in full.

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27. Litigation. Except as disclosed in the RSAs, there shall not have been instituted, threatened or be pending against, or with respect to, the Company or any of its subsidiaries any action, bankruptcy or insolvency, injunction, proceeding, application, order, claim counterclaim or investigation (whether formal or informal) (and there shall have been no material adverse development to any action, application, claim counterclaim or proceeding currently instituted, threatened or pending) before or by any stock exchange, court or any governmental, regulatory or administrative agency or instrumentally, domestic or foreign, or by any other person, domestic or foreign, in connection with the Transactions that would or would reasonably be expected to (i) prohibit, prevent, restrict or delay consummation of any of the Transactions, or (ii) impose burdensome restrictions on the Transactions.

28. Intercreditor Agreement. The agent, on behalf of itself and the lenders, under the New ABL Facility shall have entered into an intercreditor agreement (the “Intercreditor Agreement”) with the trustee on behalf of the purchasers of the First Lien Secured Notes, the trustee on behalf of the purchasers of the Second Lien Secured Notes and the trustee on behalf of the holders of new Convertible Secured Notes that is not materially less favorable to the holders of the First Lien Secured Notes and the holders of the Second Lien Secured Notes than the terms described on Exhibit C and D, respectively.

29. Audited Financial Statements. The Commitment Parties shall have received audited consolidated balance sheets and related statements of operations, stockholder’s equity and cash flows, together with all footnotes thereto, accompanied by the reports thereon of the accountants of the Company and its subsidiaries as of and for the three most recently completed fiscal years ended at least ninety days before the Closing Date, which (x) were prepared in accordance with the books of account and other financial records of the Company, (y) except as disclosed in the Secured Notes and schedules thereto, have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”), consistently applied without modification of the accounting principles used in the preparation thereof throughout the periods presented, and (z) present fairly the consolidated financial condition, results of operations and cash flows of the Company, as applicable, as at the dates and for the periods indicated therein, except to the extent any failure of the foregoing clauses to be true and correct does not result in or constitute a MAC (as defined in the RSAs).

30. Unaudited Financial Statements. The Commitment Parties shall have received (a) unaudited consolidated balance sheets and related statements of operations, stockholder’s equity and cash flows of the Company and its subsidiaries for each fiscal quarter ended after the date of this Commitment Letter and at least sixty (60) days before the Closing Date, which were prepared in accordance with GAAP, subject to the absence of footnotes and normal year-end adjustments, and (b) a pro forma consolidated balance sheet and related pro forma consolidated statement of operations of the Company and its subsidiaries for the twelve-month period ending on the last day of the most recently completed four-fiscal quarter period ended at least sixty (60) days prior to the Closing Date, prepared after giving effect to the Transactions, as if such Transactions had occurred as of such date (in the case of such balance sheet) or at the beginning of such period (in the case of such other financial statements).

31. Consents. Counsel to the Commitment Parties shall have received evidence that all boards of directors, governmental, shareholder and material third party consents and approvals

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(if any) necessary in connection with the Transactions have been obtained or duly waived and all applicable waiting periods have expired without any action being taken by any authority that could restrain, prevent or impose any material adverse conditions on such transactions or that could seek or threaten any of the foregoing.

32. PATRIOT Act. The Issuer shall have delivered all documentation and other information reasonably required by regulatory authorities under applicable “know-your-customer” and anti-money laundering rules and regulations, including the PATRIOT Act, in any case, requested in writing by the Commitment Parties at least three Business Days prior to the Closing Date.

33. Compliance with Laws. The issuance of the Secured Notes and other Transactions contemplated hereby shall be in compliance in all material respects with all applicable laws and regulations and no order, statute, rule, regulation, executive order, stay, decree, judgment or injunction shall have been proposed, enacted, entered, issued, promulgated, enforced or deemed applicable by any stock exchange, court or any governmental, regulatory or administrative agency or instrumentally, that would or would reasonably be expected to (i) prohibit, prevent, restrict or delay consummation of the Transactions, or (ii) impose burdensome restrictions on the Transaction.

34. Suspension/Limitation on Trading. There shall not have occurred (i) any general suspension of, or limitation on prices for, trading in securities in the United States securities or financial markets, (ii) any material impairment in the trading market for debt securities, (iii) any declaration of a banking moratorium or any suspension of payments in respect to banks in the United States or other major financial markets, (iv) any limitation (whether or not mandatory) by any stock exchange, government or governmental, administrative or regulatory authority or agency, domestic or foreign, or other event that might affect the extension of credit by banks or other lending institutions, (v) a commencement of a war, armed hostilities, terrorist acts or other national or international calamity directly or indirectly involving the United States or (vi) in the case of any of the foregoing existing on the date hereof, a material acceleration or worsening thereof.

35. Material Adverse Change. Except as set forth on Schedule I hereto, since March 31, 2011, no MAC has occurred and is continuing in the business, properties, operations, financial condition, assets or liabilities (whether actual or contingent) of the Company and its subsidiaries, taken as a whole.

36. Collateral. All Uniform Commercial Code UCC-1 financing statements reasonably necessary or desirable to create and perfect the first priority and second priority (as applicable) liens and security interests in respect of the collateral securing the Secured Notes shall have been delivered for filing, customary short-form security agreements with respect to intellectual property shall have been executed and delivered to the Collateral Agent for filing with the U.S. Patent and Trademark Office and the U.S. Copyright Office and certificates representing the capital stock and membership interests (to the extent issued and certificated) of the Issuer and Guarantors shall have been delivered to the collateral agent (or to its designated advisors) under the Indenture; provided that, to the extent the creation of any lien on any collateral or perfection of such lien requires any action on the part of any third party (including, without limitation, delivery of reasonably satisfactory mortgages, title insurance policies, surveys and other

12

customary documentation in connection with real estate collateral) and is not provided on the Closing Date after the Issuer’s use of commercially reasonable efforts to do so (other than in respect of the filing of financing statements and the delivery of short-form security agreements and certificates representing capital stock and membership interest, in each case as set forth above), the creation or perfection (as applicable) of such lien shall not constitute a condition precedent to the issuance of the Secured Notes on the Closing Date but such action shall be required to have been taken within a commercially reasonable time after the Closing Date and in any event within 90 days thereafter, subject to exceptions to perfection requirements to be reasonably agreed.

37. Qualification. After giving effect to the debt financing and other transactions contemplated hereby, the Company and its subsidiaries shall each be qualified as “a citizen of the United States” within the meaning of Section 2 of the Shipping Act, 1916, as amended, 46 U.S.C. § 50501(a) and (d), qualified to own and operate vessels in the coastwise trade of the United States to the extent required by such Act in connection with the Company and its subsidiaries’ business.

38. Closing; Company Deliverables. On the Closing Date, the Company shall have (i) delivered to the Commitment Parties a certificate signed by an executive officer of the Company pursuant to which such officer shall certify that all of the conditions set forth in items 6, 7, 8, 10, 12, 13, 14, 16, 17, 18 and 20 on this Exhibit G (to the extent such conditions do not consist of the satisfaction of or approvals of the Commitment Parties or their representatives) have been satisfied (or waived in writing by Commitment Parties), and (ii) delivered to each Commitment Party designated on Exhibit A and Exhibit B to the Commitment Letter the Secured Notes duly registered in name of such Commitment Party or its affiliates or its designee.

39. Information Verification. The Company shall have satisfied the information verification requirements described in a letter to a representative of the Exchanging Holders on or prior to the date of this Commitment Letter.

40. Additional Matters. The parties shall, in good faith, work and cooperate together on the corporate, tax and regulatory aspects of the Transactions and the post-reorganized Company so that the resolution of such matters is reasonably satisfactory to the Commitment Parties. Any new shipping charters entered into after the date hereof shall be in form and substance reasonably satisfactory to the Commitment Parties.

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EXHIBIT VII

SOLVENCY CERTIFICATE

I, Michael T. Avara, the duly authorized and acting Chief Financial Officer of HORIZON LINES, INC., a Delaware corporation (the “Company”), pursuant to the commitment letters, dated as of August 26, 2011 (each, a “Commitment Letter” and collectively, the “Commitment Letters”) by and between the Company and certain holders of its 4.25% convertible senior notes due in 2012 issued under the Indenture, dated as of August 8, 2007, by and between the Company, as issuer, and The Bank of New York Trust Company, N.A., as Trustee, in the aggregate principal amount of $330,000,000.00 and certain other third parties (each, a “Commitment Party” and collectively, the “Commitment Parties”) do hereby certify in the name of and on behalf of the Company and its Subsidiaries, and in my capacity as Chief Financial Officer of the Company, but without any personal liability, as follows (capitalized terms used herein and not otherwise defined herein shall have the meanings ascribed thereto in the Commitment Letter):

41. On the date hereof and after giving effect to the Transactions:

(a) the fair value of the assets of the Company and its Subsidiaries, on a consolidated basis, is greater than the total amount of liabilities, including contingent, subordinated, absolute, fixed, matured or unmatured and liquidated or unliquidated liabilities, of the Company and its Subsidiaries, on a consolidated basis;

(b) the present fair saleable value of the assets of the Company and its Subsidiaries, on a consolidated basis, exceeds (i) the amount that will be required to pay the probable liability of the Company and its Subsidiaries, on a consolidated basis, on the debts of the Company and its Subsidiaries, on a consolidated basis, as such debts become absolute and matured and (ii) the total liabilities of the Company and its Subsidiaries, on a consolidated basis (including, without limitation, subordinated, unmatured, unliquidated and known contingent liabilities);

(c) the Company and its Subsidiaries, on a consolidated basis, are able to pay their debts and other liabilities, contingent obligations and other commitments as they mature in the normal course of business;

(d) the Company and its Subsidiaries, on a consolidated basis, are not engaged in business or any transaction, or are about to engage in business or any transaction, for which their property would constitute unreasonably small capital; and

(e) the Company and its Subsidiaries, on a consolidated basis, are not “insolvent” as such term is defined in Section 101(32) of Title 11 of the United States Code, 11 U.S.C. Section 101, et. seq.

42. In consummating the Transactions, neither the Company nor any of its Subsidiaries intends to hinder, delay or defraud either present or future creditors of the Company or any of its Subsidiaries.

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43. In reaching the conclusions set forth in this Certificate, I have made such investigation and inquiries as to the financial condition of the Company and its Subsidiaries as I deem necessary and prudent for the purpose of providing this Certificate, including without limitation:

(a) the cash and other current assets of the Company and its Subsidiaries, on a consolidated basis; and

(b) all contingent liabilities of the Company and its Subsidiaries, on a consolidated basis, including, without limitation, claims arising out of pending or threatened litigation against any such entity, and in so doing, have computed the amount of such liabilities as the amount which, in light of all the facts and circumstances existing on the date hereof, represents the amount that can reasonably be expected to become an actual or matured liability.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

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IN WITNESS WHEREOF, I have executed this Certificate as of the date first above written.

By:
	Name:
	Title:    Chief Financial Officer

EX-10.3

Exhibit 10.3

EXECUTION VERSION

REGISTRATION RIGHTS AGREEMENT

by and among

Horizon Lines, Inc.,

the Guarantors listed on the signature page hereto

and

the Holders party hereto

Dated as of October 5, 2011

REGISTRATION RIGHTS AGREEMENT

This Registration Rights Agreement (this “Agreement”) is made and entered into as of October 5, 2011, by and among Horizon Lines, Inc., a Delaware corporation (the “Company”), the guarantors listed on the signature page hereto (collectively, the “Guarantors”), the investors signatory hereto (collectively, the “Initial Holders”) and any Permitted Transferee (as defined below) who hereafter becomes a party to this Agreement as contemplated by Section 7(b) of this Agreement (each such party who holds Registrable Securities (as defined below), a “Holder” and, collectively, the “Holders”).

Pursuant to the exchange offer (the “Exchange Offer”) described in the Company’s Registration Statement on Form S-4 (File No. 333-176520), the Initial Holders will exchange the Company’s existing 4.25% Convertible Senior Notes due 2012 for (i) shares of the Company’s common stock, par value $0.01 per share (“Common Stock”) (or Warrants (as defined herein) or redemption notes in lieu thereof), (ii) new 6.00% Series A Convertible Senior Secured Notes due 2017 (the “Series A Notes”) and (iii) new 6.00% Series B Convertible Senior Secured Notes (the “Series B Notes” and, together with the Series A Notes, the “New Notes”).

This Agreement is made for the benefit of the Holders. In connection with the Exchange Offer, the Company has agreed to provide the registration rights set forth in this Agreement.

The parties hereby agree as follows:

Section 1. Definitions.

As used in this Agreement, the following capitalized terms shall have the following meanings:

“Affiliate” means, with respect to any Person, any Person directly or indirectly controlling, controlled by or under common control with, such other Person. For purposes of this definition, “control” (including, with correlative meanings, the terms “controlled by” and “under common control with”) when used with respect to any Person, means the possession, directly or indirectly, of the power to cause the direction of management and/or policies of such Person, whether through the ownership of voting securities by contract or otherwise.

“Business Day” means any day other than a Saturday, Sunday or U.S. federal holiday or a day on which banking institutions or trust companies located in New York, New York are authorized or obligated to be closed. If the time to perform any action hereunder falls on a day that is not a Business Day, such time will be extended to the next Business Day and no Additional Interest shall accrue for the intervening period.

“Commission” means the Securities and Exchange Commission.

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

“FINRA” means the Financial Industry Regulatory Authority, Inc.

“Indemnified Holder” has the meaning set forth in Section 5(a) hereof.

“Permitted Transferee” means any transferee of Registrable Securities in a transaction not involving a public offering; provided that such transferee agrees in writing to become a party to this Agreement.

“Person” means an individual, partnership, corporation, trust or unincorporated organization, or a government or agency or political subdivision thereof.

“Prospectus” means the prospectus included in a Shelf Registration Statement, as amended or supplemented by any prospectus supplement and by all other amendments thereto, including post-effective amendments, and all material incorporated by reference into such Prospectus.

“Registrable Securities” means (i) all Common Stock held by the Initial Holders immediately following the consummation of the Exchange Offer, (ii) all Warrants held by the Initial Holders immediately following the consummation of the Exchange Offer and the Common Stock issuable upon exercise or conversion of such Warrants, (iii) the Series A Notes held by the Initial Holders immediately following the consummation of the Exchange Offer and the Common Stock or Warrants issuable upon conversion of such Series A Notes (including the Common Stock issuable upon exercise or conversion of any such Warrants) and (iv) the Series B Notes held by the Initial Holders immediately following the consummation of the Exchange Offer and the Common Stock or Warrants issuable upon conversion of such Series B Notes (including the Common Stock issuable upon exercise or conversion of any such Warrants). Registrable Securities include any shares of capital stock, warrants or other securities of the Company issued as a dividend or other distribution with respect to or in exchange for or in replacement of Registrable Securities. As to any particular Registrable Securities, such securities shall cease to be Registrable Securities when: (a) a Registration Statement with respect to the sale of such securities shall have become effective under the Securities Act and such securities shall have been sold, transferred, disposed of or exchanged in accordance with such Registration Statement; (b) such securities shall have ceased to be outstanding; or (c) the entire amount of the Registrable Securities held by any Holder may be sold in a single sale, in the opinion of counsel reasonably satisfactory to the Holder, without any limitation as to volume or manner of sale pursuant to Rule 144 (or any successor rule or regulation) under the Securities Act.

“Registration Statement” means a registration statement filed by the Company with the Commission in compliance with the Securities Act for a public offering and sale of Registrable Securities (other than a registration statement on Form S-4 or S-8 (or any successor or substantially similar form), or in connection with (i) an employee stock option, stock purchase or compensation plan or securities issued or issuable pursuant to any such plan or (ii) a dividend reinvestment plan).

“Securities Act” means the Securities Act of 1933, as amended.

“Shelf Registration Statement” has the meaning set forth in Section 2(a) hereof and including the Prospectus included therein, all amendments and supplements thereto (including post-effective amendments) and all exhibits and material incorporated by reference therein.

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“Warrants” means the Company’s warrants described in the Warrant Agreement dated as of the date hereof between the Company and The Bank of New York Mellon Trust Company, N.A., as warrant agent.

Section 2. Shelf Registration.

(a) Shelf Registration. The Company shall use commercially reasonable efforts to (i) cause to be filed a shelf registration statement on Form S-1 or Form S-3, as applicable, pursuant to Rule 415 under the Securities Act, which shall provide for resales, on a delayed or continuous basis, of all Registrable Securities by the Holders thereof (the “Shelf Registration Statement”), within 60 days following the date hereof and (ii) cause the Shelf Registration Statement to be declared effective under the Securities Act by no later than the 180^th day following the date hereof.

The Company shall use commercially reasonable efforts to keep such Shelf Registration Statement continuously effective, supplemented and amended as required by the provisions of Section 3 hereof to the extent necessary to ensure that it is available for resales of Registrable Securities by the Holders of such Securities entitled to the benefit of this Section 2(a), and to ensure that it conforms with the requirements of this Agreement in all material respects, the Securities Act and the policies, rules and regulations of the Commission as announced from time to time, from the date on which the Shelf Registration Statement is declared effective by the Commission until all the Registrable Securities have been sold pursuant to such Shelf Registration Statement.

(b) Provision by Holders of Certain Information in Connection with the Shelf Registration Statement. No Holder of Registrable Securities may include any of its Registrable Securities in any Shelf Registration Statement pursuant to this Agreement unless and until such Holder furnishes to the Company in writing such information as required by Regulation S-K under the Securities Act or reasonably requested by the Company for use in connection with any Shelf Registration Statement or Prospectus or preliminary Prospectus included therein. Each Holder as to which any Shelf Registration Statement is being effected agrees to furnish promptly to the Company all information required to be disclosed in order to make the information previously furnished to the Company by such Holder not materially misleading and shall promptly supply such other information as the Company may from time to time reasonably request.

(c) Certification. Within 15 Business Days following receipt of written request from the Company by any Holder whose Registrable Securities have been included in a Shelf Registration Statement (which request shall not be made more than once in any calendar year beginning with the second calendar year after the effectiveness of the Shelf Registration), such Holder shall certify to the Company that such Holder continues to hold Registrable Securities (the “Certification”). If a Holder of Registrable Securities fails to provide the Certification within the 15 Business Day period referred to in the immediately preceding sentence, the Company reserves the right, in its sole discretion, to remove such Holder’s

3

Registrable Securities from the Shelf Registration Statement within 15 Business Days after receipt by such Holder of a second written notice specifying that the Holder may be removed from the Shelf Registration Statement unless such Holder provides the Certification within such subsequent 15 Business Day period. The Company shall use commercially reasonable efforts to deliver the applicable written request(s) to any Holder.

Section 3. Registration Procedures.

(a) In connection with any Shelf Registration Statement and any Prospectus required by this Agreement to permit the sale or resale of Registrable Securities, the Company shall:

(i) use commercially reasonable efforts to keep such Shelf Registration Statement continuously effective and provide all requisite financial statements (including, if required by the Securities Act or any regulation thereunder, financial statements of the Guarantors) until all Registrable Securities have been sold; upon the occurrence of any event that would cause any such Shelf Registration Statement or the Prospectus contained therein (A) to contain a material misstatement or omission or (B) not to be effective and usable for resale of Registrable Securities during the period required by this Agreement, the Company shall file promptly an appropriate amendment to such Shelf Registration Statement, in the case of clause (A), correcting any such misstatement or omission, and, if Commission review is required, use their commercially reasonable efforts to cause such amendment to be declared effective and such Shelf Registration Statement and the related Prospectus to become usable for their intended purpose(s) as soon as practicable thereafter;

(ii) use commercially reasonable efforts to prepare and file with the Commission such amendments and post-effective amendments to the Shelf Registration Statement as may be necessary to keep the Shelf Registration Statement effective until all Registrable Securities have been sold; cause the Prospectus to be supplemented by any required Prospectus supplement, and as so supplemented to be filed pursuant to Rule 424 under the Securities Act, and to comply fully with the applicable provisions of Rules 424 and 430A under the Securities Act in a timely manner; and comply with the provisions of the Securities Act with respect to the disposition of all securities covered by such Shelf Registration Statement during the period in accordance with the intended method or methods of distribution by the sellers thereof set forth in such Shelf Registration Statement or supplement to the Prospectus;

(iii) advise each Holder whose Registrable Securities have been included in a Shelf Registration Statement, (A) when the Prospectus or any Prospectus supplement or post-effective amendment has been filed, and, with respect to such Shelf Registration Statement or any post-effective amendment thereto, when the same has become effective, (B) of any request by the Commission for amendments to the Shelf Registration Statement or amendments or supplements to the Prospectus or for additional information relating thereto, (C) of the issuance by the Commission of any stop order suspending the effectiveness of the Shelf Registration Statement under the Securities Act or of the suspension by any state securities commission of the qualification of the

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Registrable Securities for offering or sale in any jurisdiction, or the initiation of any proceeding for any of the preceding purposes, (D) of the happening of any event that makes any statement of a material fact made in the Shelf Registration Statement, the Prospectus, any amendment or supplement thereto, or any document incorporated by reference therein untrue, or that requires the making of any additions to or changes in the Shelf Registration Statement or the Prospectus in order to make the statements therein not misleading. If at any time the Commission shall issue any stop order suspending the effectiveness of the Shelf Registration Statement, or any state securities commission or other regulatory authority shall issue an order suspending the qualification or exemption from qualification of the Registrable Securities under state securities or blue sky laws, the Company shall use commercially reasonable efforts to obtain the withdrawal or lifting of such order at the earliest possible time;

(iv) furnish without charge, upon request, to each selling Holder named in a Shelf Registration Statement, and each of the underwriter(s), if any, before filing with the Commission, copies of the Shelf Registration Statement or any Prospectus included therein or any amendments or supplements to any such Shelf Registration Statement or Prospectus (including all documents incorporated by reference after the initial filing of such Shelf Registration Statement), which documents will be subject to the review and comment of such Holders and underwriter(s) in connection with such sale, if any, for a period of at least three Business Days, and the Company will not file any such Shelf Registration Statement or Prospectus or any amendment or supplement to any such Shelf Registration Statement or Prospectus (including all such documents incorporated by reference) to which a Holder of Registrable Securities covered by such Shelf Registration Statement or the underwriter(s), if any, shall reasonably object in writing within three Business Days after the receipt thereof (such objection to be deemed timely made upon confirmation of telecopy transmission within such period). The objection of a Holder or underwriter, if any, shall be deemed to be reasonable if such Shelf Registration Statement, amendment, Prospectus or supplement, as applicable, as proposed to be filed, contains a material misstatement or omission. Notwithstanding the foregoing, the Company shall not be required to take any actions under this clause (iv) that are not, in the reasonable opinion of counsel for the Company, in compliance with applicable law;

(v) promptly prior to the filing of any document that is to be incorporated by reference into a Shelf Registration Statement or Prospectus in connection with such registration or sale, if any, provide copies of such document to each selling Holder named in the Shelf Registration Statement in connection with such exchange, registration or sale, if any, and to the underwriter(s), if any, make the Company’s representatives available for discussion of such document and other customary due diligence matters subject to execution and delivery of customary confidentiality agreements, and include such information in such document prior to the filing thereof as such selling Holders or underwriter(s), if any, reasonably may request;

(vi) make available at reasonable times for inspection by the selling Holders, the underwriter(s), if any, participating in any disposition pursuant to such Shelf Registration Statement and any attorney or accountant retained by such selling Holder or

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any of the underwriter(s), all financial and other records, pertinent corporate documents and properties of each of the Company and the Guarantors and cause the Company’s and the Guarantors’ officers, directors and employees to supply all information reasonably requested by any such Holder, underwriter, attorney or accountant in connection with such Shelf Registration Statement or any post-effective amendment thereto subsequent to the filing thereof and prior to its effectiveness and to participate in meetings with investors to the extent requested by the underwriter(s), if any; provided that any Holder or representative thereof requesting or receiving such information shall agree to be bound by reasonable confidentiality agreements and procedures with respect thereto;

(vii) if requested by any selling Holders or the underwriter(s), if any, promptly incorporate in any Shelf Registration Statement or Prospectus, pursuant to a supplement or post-effective amendment if necessary, such information as such selling Holders and underwriter(s), if any, may reasonably request to have included therein, including, without limitation, information relating to the “Plan of Distribution” of the Registrable Securities, information with respect to the principal amount of Registrable Securities being sold to such underwriter(s), the purchase price being paid therefor and any other terms of the offering of the Registrable Securities to be sold in such offering; and make all required filings of such Prospectus supplement or post-effective amendment as soon as practicable after the Company is notified of the matters to be incorporated in such Prospectus supplement or post-effective amendment;

(viii) upon request, furnish to each selling Holder and each of the underwriter(s), if any, without charge, at least one copy of the Shelf Registration Statement, as first filed with the Commission, and of each amendment thereto, including financial statements and schedules (without all documents incorporated by reference therein or exhibits thereto, unless requested);

(ix) upon request, deliver to each selling Holder and each of the underwriter(s), if any, without charge, as many copies of the Prospectus (including each preliminary prospectus) and any amendment or supplement thereto as such Persons reasonably may request; provided, that if no Shelf Registration Statement is effective or no Prospectus is usable, the Company shall deliver to each selling Holder a notice to that effect in response to such request; each of the Company and the Guarantors hereby consents to the use (in accordance with law) of the Prospectus and any amendment or supplement thereto by each of the selling Holders and each of the underwriter(s), if any, in connection with the offering and the sale of the Registrable Securities covered by the Prospectus or any amendment or supplement thereto;

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(x) upon the reasonable request of such Holder, enter into such agreements (including an underwriting agreement containing customary terms), and make such representations and warranties, and take all such other actions in connection therewith in order to expedite or facilitate the disposition of the Registrable Securities pursuant to a Shelf Registration Statement contemplated by this Agreement, all to such extent as may be customarily and reasonably requested by any Holder of Registrable Securities or underwriter in connection with any sale or resale pursuant to a Shelf Registration Statement contemplated by this Agreement; and whether or not an underwriting agreement is entered into and whether or not the registration is an underwritten registration, the Company shall:

(A) upon the request of any Holder, furnish to each underwriter, if any, in such substance and scope as they may reasonably request and as are customarily made by issuers to underwriters in primary underwritten offerings, upon the date of the effectiveness of the Shelf Registration Statement:

(1) an opinion and 10b-5 letter in customary form of counsel for the Company and the Guarantors, covering the matters customarily covered in opinions and 10b-5 letters requested in similar underwritten offerings and such other matters as such parties may reasonably request; and

(2) use commercially reasonable efforts to obtain a customary comfort letter, dated the date of effectiveness of the Shelf Registration Statement, from the Company’s independent accountants, in the customary form and covering matters of the type customarily requested to be covered in comfort letters by underwriters in connection with primary underwritten offerings;

(B) deliver such other documents and certificates as may be reasonably requested by such parties to evidence compliance with clause (A) above and with any customary conditions contained in the underwriting agreement or other agreement entered into by the Company or any of the Guarantors;

(xi) prior to any public offering of Registrable Securities, cooperate with the selling Holders, the underwriter(s), if any, and their respective counsel in connection with the registration and qualification of the Registrable Securities under the state securities or blue sky laws of such jurisdictions as the selling Holders or underwriter(s), if any, may request and do any and all other acts or things necessary or advisable to enable the disposition in such jurisdictions of the Registrable Securities covered by the Shelf Registration Statement;

(xii) use its commercially reasonable efforts to cause the Registrable Securities covered by the Shelf Registration Statement to be registered with or approved by such other governmental agencies or authorities as may be necessary to enable the seller or sellers thereof or the underwriter(s), if any, to consummate the disposition of such Registrable Securities;

(xiii) if any fact or event contemplated by Section 3(a)(iii)(D) hereof shall exist or have occurred, prepare a supplement or post-effective amendment to the Shelf Registration Statement or related Prospectus or any document incorporated therein by reference or file any other required document so that, as thereafter delivered to the purchasers of Registrable Securities, the Prospectus will not contain an untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein not misleading;

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(xiv) cooperate and assist in any filings required to be made with FINRA and in the performance of any due diligence investigation by any underwriter (including any “qualified independent underwriter”) that is required to be retained in accordance with the rules and regulations of FINRA; and

(xv) otherwise use commercially reasonable efforts to comply with all applicable rules and regulations of the Commission, and make generally available to its security holders, as soon as practicable, a consolidated earnings statement meeting the requirements of Rule 158 under the Securities Act (which need not be audited) for the twelve-month period commencing after the effective date of the Shelf Registration Statement.

(b) Restrictions on Holders. Each Holder agrees that, upon receipt of the notice referred to in Section 3(a)(iii)(C) or any notice from the Company of the existence of any fact of the kind described in Section 3(a)(iii)(D) hereof (in each case, a “Suspension Notice”), such Holder will forthwith discontinue disposition of Registrable Securities pursuant to the Shelf Registration Statement until (i) such Holder’s receipt of the copies of the supplemented or amended Prospectus contemplated by Section 3(a)(xiii) hereof, or (ii) it is advised in writing by the Company that the use of the Prospectus may be resumed, and has received copies of any additional or supplemental filings that are incorporated by reference in the Prospectus. Each Holder receiving a Suspension Notice hereby agrees that it will either (1) destroy any Prospectuses, other than permanent file copies, then in such Holder’s possession which have been replaced by the Company with more recently dated Prospectuses, or (2) deliver to the Company (at the Company’s expense) all copies, other than permanent file copies then in such Holder’s possession, of the Prospectus covering such Registrable Securities that was current at the time of receipt of such notice. In the event the Company shall give any such notice, the time period regarding the effectiveness of such Shelf Registration Statement set forth in Section 2 hereof shall be extended by the number of days during the period from and including the date of the giving of such notice pursuant to Section 3(a)(iii)(D) hereof to and including the date when each selling Holder covered by such Shelf Registration Statement shall have received the copies of the supplemented or amended Prospectus contemplated by Section 3(a)(xiii) hereof or shall have been advised in writing that the use of the Prospectus may be resumed.

Section 4. Registration Expenses.

(a) All expenses incident to the Company’s performance of or compliance with this Agreement will be borne by the Company regardless of whether a Shelf Registration Statement becomes effective, including, without limitation: (i) all registration and filing fees and expenses (including filings made by any Holder with FINRA (and, if applicable, the fees and expenses of any “qualified independent underwriter” and its counsel that may be required by the rules and regulations of FINRA)); (ii) all fees and expenses of compliance with federal securities and state securities or blue sky laws; (iii) all fees and disbursements of counsel for the Company and reasonable and documented fees and disbursements for one counsel for all of the Holders of Registrable Securities; and (iv) all fees and disbursements of independent certified public accountants of the Company and the Guarantors (including the expenses of any special audit and comfort letters required by or incident to such performance).

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The Company will, in any event, bear its internal expenses (including, without limitation, all salaries and expenses of its officers and employees performing legal or accounting duties), the expenses of any annual audit and the fees and expenses of any Person, including special experts, retained by the Company.

(b) In connection with a Shelf Registration Statement required by this Agreement, the Company will reimburse the Holders of Registrable Securities being registered pursuant to the Shelf Registration Statement for the reasonable and documented fees and disbursements of counsel.

Section 5. Indemnification.

(a) The Company agrees to indemnify and hold harmless (i) each Holder and (ii) each Person, if any, who controls (within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act) any Holder (any of the Persons referred to in this clause (ii) being hereinafter referred to as a “controlling person”) and (iii) the respective officers, directors, partners, employees, representatives and agents of any Holder or any controlling person (any Person referred to in clause (i), (ii) or (iii) may hereinafter be referred to as an “Indemnified Holder”), to the fullest extent lawful, from and against any and all losses, claims, damages, liabilities, judgments, actions and expenses (including, without limitation, and as incurred, reimbursement of all reasonable out-of-pocket costs of investigating, preparing, pursuing, settling, compromising, paying or defending any claim or action, or any investigation or proceeding by any governmental agency or body, commenced or threatened, including the reasonable fees and expenses of counsel to any Indemnified Holder), joint or several, directly or indirectly caused by, related to, based upon, arising out of or in connection with any untrue statement or alleged untrue statement of a material fact contained in a Shelf Registration Statement or Prospectus (or any amendment or supplement thereto), or any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, except insofar as such losses, claims, damages, liabilities or expenses are caused by an untrue statement or omission or alleged untrue statement or omission that is based upon information relating to any of the Holders furnished in writing to the Company by or on behalf of any of the Holders expressly for use therein or out of sales of Registrable Securities made during a Suspension Period after notice is given pursuant to Section 3(b) hereof. This indemnity agreement shall be in addition to any liability which the Company may otherwise have.

In case any action or proceeding (including any governmental or regulatory investigation or proceeding) shall be brought or asserted against any of the Indemnified Holders with respect to which indemnity may be sought against the Company, such Indemnified Holder (or the Indemnified Holder controlled by such controlling person) shall promptly notify the Company in writing; provided, however, that the failure to give such notice shall not relieve the Company of its obligations pursuant to this Agreement except to the extent that it had been materially prejudiced by such failure (through forfeiture of substantive rights). Such Indemnified Holder shall have the right to employ its own counsel in any such action and the

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fees and expenses of such counsel shall be paid, as incurred, by the Company. The Company shall not, in connection with any one such action or proceeding or separate but substantially similar or related actions or proceedings in the same jurisdiction arising out of the same general allegations or circumstances, be liable for the reasonable fees and expenses of more than one separate firm of attorneys (in addition to any local counsel) at any time for such Indemnified Holders, which firm shall be designated by the Holders. The Company shall be liable for any settlement of any such action or proceeding effected with the Company’s prior written consent, which consent shall not be withheld unreasonably, and the Company agrees to indemnify and hold harmless any Indemnified Holder from and against any loss, claim, damage, liability or reasonable out-of-pocket expense by reason of any settlement of any action effected with the written consent of the Company. The Company shall not, without the prior written consent of each Indemnified Holder, settle or compromise or consent to the entry of judgment in or otherwise seek to terminate any pending or threatened action, claim, litigation or proceeding in respect of which indemnification or contribution may be sought hereunder (whether or not any Indemnified Holder is a party thereto), unless such settlement, compromise, consent or termination (i) includes an unconditional release of each Indemnified Holder from all liability arising out of such action, claim, litigation or proceeding and (ii) does not include a statement as to an admission of fault, culpability or a failure to act, by or on behalf of the Indemnified Holder.

(b) By its acquisition of Registrable Securities, each Holder of Registrable Securities agrees, severally and not jointly, to indemnify and hold harmless the Company and the directors and officers of the Company who sign a Shelf Registration Statement, and any Person controlling (within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act) the Company, and the respective officers, directors, partners, employees, representatives and agents of each such Person, to the same extent as the foregoing indemnity from the Company to each of the Indemnified Holders, but only with respect to claims and actions based on information relating to such Holder furnished in writing by such Holder expressly for use in a Shelf Registration Statement. In case any action or proceeding shall be brought against the Company or its directors or officers or any such controlling person in respect of which indemnity may be sought against a Holder of Registrable Securities, such Holder shall have the rights and duties given the Company, and the Company, its directors and officers and such controlling person shall have the rights and duties given to each Holder by the preceding paragraph.

(c) If the indemnification provided for in this Section 5 is unavailable to an indemnified party under Section 5(a) or (b) hereof (other than by reason of exceptions provided in those Sections) in respect of any losses, claims, damages, liabilities, judgments, actions or expenses referred to therein, then each applicable indemnifying party, in lieu of indemnifying such indemnified party, shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages, liabilities or expenses in such proportion as is appropriate to reflect the relative fault of the Company, on the one hand, and the Holders, on the other hand, in connection with the statements or omissions which resulted in such losses, claims, damages, liabilities or expenses, as well as any other relevant equitable considerations. The relative fault of the Company, on the one hand, and of the Indemnified Holder, on the other hand, shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company, on the one hand, or the Indemnified Holders, on

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the other hand, and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The amount paid or payable by a party as a result of the losses, claims, damages, liabilities and expenses referred to above shall be deemed to include, subject to the limitations set forth in the second paragraph of Section 5(a) hereof, any legal or other fees or expenses reasonably incurred by such party in connection with investigating or defending any action or claim.

The Company and each Holder of Registrable Securities agree that it would not be just and equitable if contribution pursuant to this Section 5(c) were determined by pro rata allocation (even if the Holders were treated as one entity for such purpose) or by any other method of allocation which does not take account of the equitable considerations referred to in the immediately preceding paragraph. The amount paid or payable by an indemnified party as a result of the losses, claims, damages, liabilities or expenses referred to in the immediately preceding paragraph shall be deemed to include, subject to the limitations set forth above, any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this Section 5, the total amount to be contributed by a Holder pursuant to this Section 5 shall be limited to the net proceeds (after deducting underwriters’ discounts and commissions) received by such Holder in the offering to which such Shelf Registration Statement or prospectus relates. No Person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation. The Holders’ obligations to contribute pursuant to this Section 5(c) are several in proportion to the respective principal amount of Securities held by each of the Holders hereunder and not joint.

Section 6. Underwritten Offerings. The Holders of Registrable Securities covered by the Shelf Registration Statement who desire to do so may sell such Registrable Securities in an underwritten offering. In any such underwritten offering, the investment banker(s) and managing underwriter(s) that will administer such offering will be selected by the Holders of a majority in aggregate principal amount of the Registrable Securities included in such offering; provided, however, that such investment banker(s) and managing underwriter(s) must be reasonably satisfactory to the Company. No Holder may participate in any underwritten offering hereunder unless such Holder (a) agrees to sell such Holder’s Registrable Securities on the basis provided in any underwriting arrangements approved by the Persons entitled hereunder to approve such arrangements and (b) completes and executes all reasonable questionnaires, powers of attorney, indemnities, underwriting agreements, lock-up letters and other documents required under the terms of such underwriting arrangements.

Section 7. Miscellaneous.

(a) Remedies. The Company hereby agrees that monetary damages would not be adequate compensation for any loss incurred by reason of a breach by it of the provisions of this Agreement and hereby agree to waive the defense in any action for specific performance that a remedy at law would be adequate.

(b) Assignment; No Third Party Beneficiaries; Additional Parties. This Agreement and the rights, duties and obligations of the Company and the Guarantors hereunder

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may not be assigned or delegated by the Company or the Guarantors in whole or in part. This Agreement and the rights, duties and obligations of the Holders hereunder may be freely assigned or delegated by such Holder in conjunction with and to the extent of any transfer of Registrable Securities by any such Holder to a Permitted Transferee. This Agreement is not intended to confer any rights or benefits on any persons that are not party hereto other than as expressly set forth in Section 5 and this Section 7(b).

(c) No Inconsistent Agreements. The Company will not on or after the date of this Agreement enter into any agreement with respect to its securities that is inconsistent with the rights granted to the Holders in this Agreement or otherwise conflicts with the provisions hereof. The rights granted to the Holders hereunder do not in any way conflict with and are not inconsistent with the rights granted to the holders of the Company’s securities under any agreement in effect on the date hereof.

(d) Amendments and Waivers. The provisions of this Agreement may not be amended, modified or supplemented, and waivers or consents to or departures from the provisions hereof may not be given unless the Company has obtained the written consent of Holders of a majority of the outstanding principal amount of Registrable Securities (excluding any Registrable Securities held by the Company or its subsidiaries); provided, however, that, with respect to any matter that directly or indirectly affects the rights of any Initial Holder hereunder, the Company shall obtain the written consent of each such Initial Holder with respect to which such amendment, qualification, supplement, waiver, consent or departure is to be effective.

(e) Notices. All notices and other communications provided for or permitted hereunder shall be made in writing by hand-delivery, first-class mail (registered or certified, return receipt requested), telex, telecopier, or air courier guaranteeing overnight delivery:

(i) if to a Holder, at the address set forth on the records of the registrar under the indenture governing the New Notes; and

(ii) if to the Company:

Horizon Lines, Inc.

4064 Colony Road, Suite 200

Charlotte, NC 28211

Telephone: (704) 973-7000

Facsimile: (704) 973-7010

Attention: General Counsel

All such notices and communications shall be deemed to have been duly given: at the time delivered by hand, if personally delivered; five Business Days after being deposited in the mail, postage prepaid, if mailed; when answered back, if telexed; when receipt acknowledged, if telecopied; and on the next Business Day, if timely delivered to an air courier guaranteeing overnight delivery.

(f) Successors and Assigns. This Agreement shall inure to the benefit of and be binding upon the successors and assigns of each of the parties, including, without limitation,

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and without the need for an express assignment, subsequent Holders of Registrable Securities; provided, however, that this Agreement shall not inure to the benefit of or be binding upon a successor or assign of a Holder unless and to the extent such successor or assign acquired Registrable Securities from such Holder.

(g) Counterparts. This Agreement may be executed in any number of counterparts and by the parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement.

(h) Headings. The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof.

(i) Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of New York, without regard to the conflicts of law rules thereof.

(j) Severability. In the event that any one or more of the provisions contained herein, or the application thereof in any circumstance, is held invalid, illegal or unenforceable, the validity, legality and enforceability of any such provision in every other respect and of the remaining provisions contained herein shall not be affected or impaired thereby.

(k) Entire Agreement. This Agreement is intended by the parties as a final expression of their agreement and intended to be a complete and exclusive statement of the agreement and understanding of the parties hereto in respect of the subject matter contained herein. There are no restrictions, promises, warranties or undertakings, other than those set forth or referred to herein with respect to the registration rights granted by the Company with respect to the Registrable Securities. This Agreement supersedes all prior agreements and understandings between the parties with respect to such subject matter.

(l) Use of Free Writing Prospectus. No Holder shall use a free writing prospectus prepared by or on behalf of the relevant Holder or used or referred to by such Holder in connection with the offering of Registrable Securities pursuant to the Shelf Registration Statement without the prior written consent of the Company, which shall not be unreasonably withheld.

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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.

HORIZON LINES, INC.
By:
	Name:
	Title:
HORIZON LINES, LLC
HORIZON LINES HOLDING CORP.
HAWAII STEVEDORES, INC.
HORIZON LINES OF PUERTO RICO, INC.
HORIZON LINES OF ALASKA, LLC
HORIZON LINES OF GUAM, LLC
HORIZON LINES VESSELS, LLC
H-L DISTRIBUTION SERVICE, LLC
HORIZON LOGISTICS, LLC
AERO LOGISTICS, LLC
SEA-LOGIX, LLC
HORIZON SERVICES GROUP, LLC
By:
	Name:
	Title:

The foregoing Registration Rights Agreement is hereby confirmed and accepted as of the date first above written:

CASPIAN CAPITAL MANAGEMENT
By:
	Name: Title
ARCHVIEW INVESTMENT GROUP
By:
	Name: Title
POST ADVISORY GROUP
By:
	Name: Title
BEACH POINT CAPITAL MANAGEMENT
By:
	Name: Title
WESTERN ASSET MANAGEMENT
By:
	Name: Title

LOGAN CIRCLE PARTNERS
By:
	Name: Title
TROOB CAPITAL MANAGEMENT
By:
	Name: Title

EX-10.4

Exhibit 10.4

EXECUTION VERSION

REGISTRATION RIGHTS AGREEMENT

by and among

Horizon Lines, LLC

the Guarantors Listed on the Signature Pages hereto

and

Purchasers

Dated as of October 5, 2011

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REGISTRATION RIGHTS AGREEMENT

This Registration Rights Agreement (this “Agreement”) is made and entered into as of October 5, 2011, by and among Horizon Lines, LLC, a Delaware limited liability company (the “Company”), the guarantors listed on Schedule I hereto (collectively, the “Guarantors”) and the Purchasers, governing the Company’s 11.0% Senior Secured Notes due 2016 (the “Initial Notes”), which are fully and unconditionally guaranteed by the Guarantors (the “Guarantees”). The Initial Notes and the Guarantees attached thereto are herein collectively referred to as the “Initial Securities.”

This Agreement is made pursuant to the Purchase Agreement relating to the Initial Notes of even date herewith, (the “Purchase Agreement”), by and among the Company, the Guarantors and the various Purchasers. In order to induce the Purchasers to purchase the Initial Securities, the Company has agreed to provide the registration rights set forth in this Agreement. The execution and delivery of this Agreement is a condition to the obligations of the Purchasers set forth in Section 6(k) of the Purchase Agreement. Capitalized terms used herein and not otherwise defined shall have the meaning assigned to them in the Indenture of even date herewith (as amended or supplemented from time to time, the “Indenture”), by and among the Company, the Guarantors and U.S. Bank National Association, as trustee (the “Trustee”), relating to the Initial Notes and the Exchange Notes (as defined below).

The parties hereby agree as follows:

SECTION 1. Definitions. As used in this Agreement, the following capitalized terms shall have the following meanings:

Additional Interest: As defined in Section 5 hereof.

Advice: As defined in Section 6(d) hereof.

Affiliate: As defined in Rule 144.

Broker-Dealer: Any broker or dealer registered with the Commission under the Exchange Act.

Business Day: Any day other than a Saturday, Sunday or U.S. federal holiday or a day on which banking institutions or trust companies located in New York, New York are authorized or obligated to be closed. If the time to perform any action hereunder falls on a day that is not a Business Day, such time will be extended to the next Business Day and no Additional Interest shall accrue for the intervening period.

Closing Date: The date of this Agreement.

Commission: The Securities and Exchange Commission.

Consummate: An Exchange Offer shall be deemed “Consummated” for purposes of this Agreement upon the occurrence of (i) the filing and effectiveness under the Securities Act of the

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Exchange Offer Registration Statement relating to the Exchange Securities to be issued in the Exchange Offer, (ii) the maintenance of such Exchange Offer Registration Statement continuously effective and the keeping of the Exchange Offer open for a period not less than the minimum period required pursuant to Section 3(b) hereof, and (iii) the delivery by the Company to the Registrar under the Indenture of Exchange Securities in the same aggregate principal amount as the aggregate principal amount of Initial Securities that were validly tendered (and not withdrawn) by Holders thereof pursuant to the Exchange Offer.

Exchange Act: The Securities Exchange Act of 1934.

Exchange Date: As defined in Section 3(a) hereto.

Exchange Offer: The registration by the Company under the Securities Act of the issuance of the Exchange Securities pursuant to a Registration Statement pursuant to which the Company offers the Holders of all outstanding Transfer Restricted Securities the opportunity to exchange all such outstanding Transfer Restricted Securities held by such Holders for Exchange Securities in an aggregate principal amount equal to the aggregate principal amount of the Transfer Restricted Securities tendered in such exchange offer by such Holders.

Exchange Offer Registration Statement: The Registration Statement relating to the Exchange Offer, including the related Prospectus.

Exchange Securities or Exchange Notes: The 11.00% Senior Secured Notes due 2016, of the same series under the Indenture (and having the same rights and provisions, except for registration rights) as the Initial Notes and the Guarantees attached thereto, to be issued to Holders in exchange for Transfer Restricted Securities pursuant to this Agreement in the Exchange Offer.

FINRA: Financial Industry Regulatory Authority, Inc.

Holders: As defined in Section 2(b) hereof.

Indemnified Holder: As defined in Section 8(a) hereof.

Indenture: As defined in the preamble hereto.

Initial Notes: As defined in the preamble hereto.

Initial Placement: The issuance and sale by the Company of the Initial Securities to the Purchasers pursuant to the Purchase Agreements.

Initial Securities: As defined in the preamble hereto.

Interest Payment Date: As defined in the Indenture and the Securities.

Person: An individual, partnership, corporation, trust or unincorporated organization, or a government or agency or political subdivision thereof.

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Prospectus: The prospectus included in a Registration Statement, as amended or supplemented by any prospectus supplement and by all other amendments thereto, including post-effective amendments, and all material incorporated by reference into such Prospectus.

Purchaser: Each “Purchaser” named in a Purchase Agreement.

Registration Default: As defined in Section 5 hereof.

Registration Statement: Any registration statement of the Company and the Guarantors relating to (a) an offering of Exchange Securities pursuant to an Exchange Offer or (b) the registration for resale of Transfer Restricted Securities pursuant to the Shelf Registration Statement, in each case, (i) that is filed pursuant to the provisions of this Agreement, (ii) including the Prospectus included therein, and (iii) including all amendments and supplements thereto (including post-effective amendments) and all exhibits and material incorporated by reference therein.

Restricted Holder: A holder (i) that is an Affiliate of the Company within the meaning of Rule 405 or Rule 144, (ii) who acquires Exchange Notes outside the ordinary course of such holder’s business, (iii) who has arrangements or understandings with any person to participate in the Exchange Offer for the purpose of distributing Exchange Notes and (iv) that is a Broker-Dealer, but only with respect to Exchange Notes received by such Broker-Dealer pursuant to the Exchange Offer in exchange for Transfer Restricted Securities acquired by the Broker-Dealer directly from the Company.

Rule 144: Rule 144 promulgated under the Securities Act.

Securities: The Initial Securities and/or the Exchange Securities, as applicable.

Securities Act: The Securities Act of 1933.

Shelf Effectiveness Deadline: As defined in Section 4(a) hereof.

Shelf Registration Statement: As defined in Section 4(a) hereof.

Transfer Restricted Securities: The Initial Securities; provided that the Initial Securities shall cease to be Transfer Restricted Securities on the earliest to occur of (i) the date on which a Registration Statement with respect to such Initial Securities has become effective under the Securities Act and such Initial Securities have been exchanged or disposed of pursuant to such Registration Statement; (ii) such Initial Securities are sold pursuant to Rule 144 under circumstances in which any legend borne by such Initial Securities relating to restrictions on transferability thereof, under the Securities Act or otherwise, is removed by the Company or pursuant to the Indenture; (iii) the date that is one (1) year after the date of this Agreement, if the holder of such Initial Securities is eligible to dispose of all of the Initial Securities held by such holder within a three (3) month period pursuant to Rule 144(e) (or any successor provision thereto) and the restrictive legend has been removed from all certificates evidencing such Initial Securities; or (iv) the date on which such Initial Securities cease to be outstanding.

Trust Indenture Act: The Trust Indenture Act of 1939.

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Underwritten Registration or Underwritten Offering: A registration in which securities of the Company are sold to an underwriter for reoffering to the public.

SECTION 2. Securities Subject to this Agreement.

(a) Transfer Restricted Securities. The securities entitled to the benefits of this Agreement are the Transfer Restricted Securities.

(b) Holders of Transfer Restricted Securities. A Person, including each Purchaser, is deemed to be a holder of Transfer Restricted Securities (each, a “Holder”) whenever such Person owns Transfer Restricted Securities, whether such Person owns such Transfer Restricted Securities directly or through nominees.

SECTION 3. Registered Exchange Offer.

(a) Unless the Exchange Offer shall not be permissible under applicable law or Commission policy (after the procedures set forth in Section 6(a)(i) hereof have been complied with), or there are no Transfer Restricted Securities outstanding, the Company and the Guarantors shall, as soon as practicable after the Closing Date, (i) cause the Exchange Offer Registration Statement to be filed with the Commission, (ii) use commercially reasonable efforts to cause such Exchange Offer Registration Statement to become effective, (iii) in connection with the foregoing, use commercially reasonable efforts to (A) file all preeffective amendments to such Exchange Offer Registration Statement as may be necessary in order to cause it to become effective, (B) file, if applicable, a post-effective amendment to such Exchange Offer Registration Statement pursuant to Rule 430A under the Securities Act and (C) cause all necessary filings, if any, in connection with the registration and qualification of the Exchange Securities to be made under the state securities or blue sky laws of such jurisdictions as are necessary to permit Consummation of the Exchange Offer, provided, however, that neither the Company nor any Guarantor shall be required to take any action that would subject them to general service of process or taxation in any jurisdiction where they are not already subject, and (iv) upon the effectiveness of such Exchange Offer Registration Statement, commence the Exchange Offer. Each of the Company and the Guarantors shall use commercially reasonable efforts to Consummate the Exchange Offer as soon as practicable after the Closing Date, but in any event not later than 180 days following the Closing Date (such 180th day being the “Exchange Date”). The Exchange Offer, if required pursuant to this Section 3(a), shall be on the appropriate form permitting registration of the Exchange Securities to be offered in exchange for the Transfer Restricted Securities and to permit resales of Initial Securities held by Broker-Dealers as contemplated by Section 3(c) hereof.

(b) If an Exchange Offer Registration Statement is required to be filed and declared effective pursuant to Section 3(a) above, the Company and the Guarantors shall use commercially reasonable efforts to cause the Exchange Offer Registration Statement to be effective continuously, and shall keep the Exchange Offer open for a period of not less than the minimum period required under applicable federal and state securities laws to Consummate the Exchange Offer; provided, however, that in no event shall such period be less than 20 Business Days after the date notice of the Exchange Offer is mailed to the Holders. The Company shall cause the Exchange Offer to comply with all applicable federal and state securities laws. No securities other than the Exchange Securities shall be included in the Exchange Offer Registration Statement.

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(c) The Company shall indicate in a “Plan of Distribution” section contained in the Prospectus forming a part of the Exchange Offer Registration Statement that any Broker-Dealer who holds Transfer Restricted Securities that were acquired for its own account as a result of market-making activities or other trading activities (other than Initial Securities acquired directly from the Company), may exchange such Transfer Restricted Securities pursuant to the Exchange Offer. Such “Plan of Distribution” section shall also contain all other information with respect to such resales by Broker-Dealers that the Commission may require in order to permit such resales pursuant thereto, but such “Plan of Distribution” shall not name any such Broker-Dealer or disclose the amount of Transfer Restricted Securities held by any such Broker-Dealer except to the extent required by the Commission as a result of a change in policy after the date of this Agreement.

Because such Broker-Dealer may be deemed to be an “underwriter” within the meaning of the Securities Act and must, therefore, deliver a prospectus meeting the requirements of the Securities Act in connection with resales of any Exchange Securities received by such Broker-Dealer in the Exchange Offer, the Company and the Guarantors shall permit the use of the Prospectus contained in the Exchange Offer Registration Statement by such Broker-Dealer to satisfy such prospectus delivery requirement. The Company and the Guarantors shall use commercially reasonable efforts to keep the Exchange Offer Registration Statement continuously effective, supplemented and amended as required by the provisions of Section 6(c) hereof to the extent necessary to ensure that it is available for resales of Transfer Restricted Securities acquired by Broker-Dealers for their own accounts as a result of marketmaking activities or other trading activities, and to ensure that it conforms with the requirements of this Agreement, the Securities Act and the policies, rules and regulations of the Commission as announced from time to time, for a period ending on the earlier of (i) 180 days from the date on which the Exchange Offer Registration Statement is declared effective and (ii) the date on which a Broker-Dealer is no longer required to deliver a prospectus in connection with marketmaking or other trading activities.

Upon request, the Company shall provide sufficient copies of the latest version of such Prospectus to such Broker-Dealers within five Business Days after such request at any time during such 180 day (or shorter, as provided in the foregoing sentence) period in order to facilitate such resales.

SECTION 4. Shelf Registration.

(a) Shelf Registration. If (i) the Company and the Guarantors are not required to file an Exchange Offer Registration Statement or to Consummate the Exchange Offer solely because the Exchange Offer is not permitted by applicable law or Commission policy (after the procedures set forth in Section 6(a)(i) hereof have been complied with), (ii) for any reason the Exchange Offer is not Consummated by the Exchange Date, or (iii) prior to the Exchange Date, (A) one or more Purchasers make a request to the Company with respect to Transfer Restricted Securities not eligible to be exchanged for Exchange Securities in the Exchange Offer or (B) any Holder of Transfer Restricted Securities notifies the Company that (1) such Holder is prohibited

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by applicable law or Commission policy from participating in the Exchange Offer, (2) such Holder may not resell the Exchange Securities acquired by it in the Exchange Offer to the public without delivering a prospectus and that the Prospectus contained in the Exchange Offer Registration Statement is not appropriate or available for such resales by such Holder, or (3) such Holder is a Broker-Dealer and holds Transfer Restricted Securities acquired directly from the Company or one of its Affiliates, then the Company and the Guarantors shall use commercially reasonable efforts to cause to be filed and declared effective a shelf registration statement pursuant to Rule 415 under the Securities Act, which may be an amendment to the Exchange Offer Registration Statement (in either event, the “Shelf Registration Statement”), as soon as practicable after the Closing Date and in any event, on or prior to the 90th day after the date such obligation arises pursuant to this clause (such later date being the “Shelf Effectiveness Deadline”), which Shelf Registration Statement shall provide for resales of all Transfer Restricted Securities the Holders of which shall have provided the information required pursuant to Section 4(b) hereof.

Each of the Company and the Guarantors shall use commercially reasonable efforts to keep such Shelf Registration Statement continuously effective, supplemented and amended as required by the provisions of Sections 6(b) and (c) hereof to the extent necessary to ensure that it is available for resales of Transfer Restricted Securities by the Holders of such Securities entitled to the benefit of this Section 4(a), and to ensure that it conforms with the requirements of this Agreement in all material respect, the Securities Act and the policies, rules and regulations of the Commission as announced from time to time, from the date on which the Shelf Registration Statement is declared effective by the Commission until the expiration of the one year period referred to in Rule 144 applicable to securities held by nonaffiliates under the Securities Act (or shorter period that will terminate when all the Transfer Restricted Securities covered by such Shelf Registration Statement have been sold pursuant to such Shelf Registration Statement).

(b) Provision by Holders of Certain Information in Connection with the Shelf Registration Statement. No Holder of Transfer Restricted Securities may include any of its Transfer Restricted Securities in any Shelf Registration Statement pursuant to this Agreement unless and until such Holder furnishes to the Company in writing, within 20 Business Days after receipt of a request therefor, such information as required by Regulation S-K of the Securities Act or, reasonably requested by the Company for use in connection with any Shelf Registration Statement or Prospectus or preliminary Prospectus included therein. No Holder shall be entitled to Additional Interest pursuant to Section 5 hereof unless and until (and from and after such time) such Holder shall have provided all such information. Each Holder as to which any Shelf Registration Statement is being effected agrees to furnish promptly to the Company all information required to be disclosed in order to make the information previously furnished to the Company by such Holder not materially misleading and shall promptly supply such other information as the Company may from time to time reasonably request.

(c) Certification. Within fifteen (15) business days following receipt of written request from the Company by any Holder (which request shall not be made more than once in any calendar year), such Holder shall certify to the Company that such holder continues to hold Transfer Restricted Securities (the “Certification”). If a Holder fails to provide the Certification within the fifteen (15) business day period referred to in the immediately preceding sentence, the Company reserves the right, in its sole discretion, to remove such Holder’s Transfer Restricted

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Securities from a Registration Statement within fifteen (15) business days after receipt by such holder of a second written notice specifying that the Holder may be removed from such Registration Statement unless such holder provides the Certification within such subsequent fifteen (15) business day period. The Company will use commercially reasonable efforts to notify all Holders of the certification request pursuant to this Section 4(c).

SECTION 5. Additional Interest. If (i) the Exchange Offer has not been Consummated by the Exchange Date, (ii) any Shelf Registration Statement, if required hereby, has not been declared effective by the Commission by the Shelf Effectiveness Deadline or (iii) any Registration Statement required by this Agreement has been declared effective but ceases to be effective or otherwise available at any time for more than 60 calendar days in a twelve month period during which it is required to be effective under this Agreement (each such event referred to in clauses (i) through (iii), a “Registration Default”), the Company hereby agrees that the interest rate borne by the Transfer Restricted Securities shall be increased by 0.25% per annum during the 90-day period immediately following the occurrence of any Registration Default and shall increase by 0.25% per annum at the end of each subsequent 90-day period (such increase, “Additional Interest”), but in no event shall such increase exceed 1.00% per annum on the principal amount of Transfer Restricted Securities; provided that the Company and the Guarantors shall in no event be required to pay Additional Interest for more than one Registration Default at any given time. At the cure of all Registration Defaults relating to the particular Transfer Restricted Securities, the interest rate borne by the relevant Transfer Restricted Securities will be reduced to the original interest rate borne by such Transfer Restricted Securities.

All accrued Additional Interest shall be paid by the Company and the Guarantors (or the Company and the Guarantors will cause the Paying Agent to make such payment on their behalf) to the Holders entitled thereto, in the manner provided for the payment of interest in the Indenture, on each Interest Payment Date, as more fully set forth in the Indenture, the Initial Notes and the Exchange Notes. All obligations of the Company and the Guarantors set forth in the preceding paragraph that are outstanding with respect to any Transfer Restricted Security at the time such security ceases to be a Transfer Restricted Security shall survive until such time as all such obligations with respect to such security shall have been satisfied in full.

SECTION 6. Registration Procedures.

(a) Exchange Offer Registration Statement. In connection with the Exchange Offer, if required pursuant to Section 3(a) hereof, the Company and the Guarantors shall comply with all of the provisions of Section 6(c) hereof, shall use commercially reasonable efforts to effect such exchange to permit the sale of Transfer Restricted Securities being sold in accordance with the intended method or methods of distribution thereof, and shall comply with all of the following provisions:

(i) If in the reasonable opinion of counsel to the Company there is a question as to whether the Exchange Offer is permitted by applicable law, each of the Company and the Guarantors hereby agrees to use commercially reasonable efforts to seek a no-action letter or other favorable decision from the Commission allowing the Company and the Guarantors to Consummate an Exchange Offer for such Transfer Restricted

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Securities. Each of the Company and the Guarantors hereby agrees to pursue the issuance of such a decision to the Commission staff level but shall not be required to take commercially unreasonable action to effect a change of Commission policy. In connection with the foregoing, each of the Company and the Guarantors hereby agrees, however, to (A) participate in telephonic conferences with the Commission, (B) deliver to the Commission staff an analysis prepared by counsel to the Company setting forth the legal bases, if any, upon which such counsel has concluded that such an Exchange Offer should be permitted and (C) diligently pursue a resolution (which need not be favorable and which need not be a written resolution) by the Commission staff of such submission.

(ii) As a condition to its participation in the Exchange Offer pursuant to the terms of this Agreement, each Holder of Transfer Restricted Securities (including, without limitation, any Holder who is a Broker-Dealer) shall furnish, upon the request of the Company, prior to the Consummation of the Exchange Offer, a written representation to the Company and the Guarantors (which may be contained in the letter of transmittal contemplated by the Exchange Offer Registration Statement) to the effect that (A) it is not an Affiliate of the Company, (B) it is not engaged in, and does not intend to engage in, and has no arrangement or understanding with any Person to participate in, a distribution of the Exchange Securities to be issued in the Exchange Offer, (C) it is acquiring the Exchange Securities in its ordinary course of business, and (D) only if such Holder is a Broker-Dealer that will receive Exchange Securities in exchange for Initial Securities that such Broker-Dealer acquired for its own private account as a result of market making or other trading activities, it will deliver a Prospectus, as required by law, in connection with any sale of such Exchange Securities. In addition, all such Holders of Transfer Restricted Securities shall otherwise cooperate in the Company’s preparations for the Exchange Offer. As a condition to its participation in the Exchange Offer, each Holder hereby acknowledges and agrees that any Holder that is a Broker-Dealer using the Exchange Offer to participate in a distribution of the securities to be acquired in the Exchange Offer (1) could not, under Commission policy as in effect on the date of this Agreement, rely on the position of the Commission enunciated in Morgan Stanley and Co., Inc.(available June 5, 1991) and Exxon Capital Holdings Corporation (available May 13, 1988), as interpreted in the Commission’s letter to Shearman & Sterling dated July 2, 1993, and similar no-action letters (which may include any no-action letter obtained pursuant to clause (i) above), and (2) must comply with the registration and prospectus delivery requirements of the Securities Act in connection with a secondary resale transaction and that such a secondary resale transaction should be covered by an effective registration statement containing the selling security holder information required by Item 507 or 508, as applicable, of Regulation S-K if the resales are of Exchange Securities obtained by such Holder in exchange for Transfer Restricted Securities acquired by such Holder directly from the Company.

(b) Shelf Registration Statement. If required pursuant to Section 4, in connection with the Shelf Registration Statement, each of the Company and the Guarantors shall comply with all the provisions of Section 6(c) hereof and shall use commercially reasonable efforts to effect such registration to permit the sale of the Transfer Restricted Securities being sold in accordance with the intended method or methods of distribution thereof, and pursuant thereto each of the Company and the Guarantors will as expeditiously as possible prepare and file with

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the Commission a Registration Statement relating to the registration on any appropriate form under the Securities Act, which form shall be available for the sale of the Transfer Restricted Securities in accordance with the intended method or methods of distribution thereof.

(c) General Provisions. In connection with any Registration Statement and any Prospectus required by this Agreement to permit the sale or resale of Transfer Restricted Securities (including, without limitation, any Registration Statement and the related Prospectus required to permit resales of Transfer Restricted Securities by Broker-Dealers), each of the Company and the Guarantors shall:

(i) use commercially reasonable efforts to keep such Registration Statement continuously effective and provide all requisite financial statements (including, if required by the Securities Act or any regulation thereunder, financial statements of the Guarantors) for the period specified in Section 3 or 4 hereof, as applicable; upon the occurrence of any event that would cause any such Registration Statement or the Prospectus contained therein (A) to contain a material misstatement or omission or (B) not to be effective and usable for resale of Transfer Restricted Securities during the period required by this Agreement, the Company shall file promptly an appropriate amendment to such Registration Statement, in the case of clause (A), correcting any such misstatement or omission, and, if Commission review is required, use commercially reasonable efforts to cause such amendment to be declared effective and such Registration Statement and the related Prospectus to become usable for their intended purpose(s) as soon as practicable thereafter;

(ii) use commercially reasonable efforts to prepare and file with the Commission such amendments and post-effective amendments to the applicable Registration Statement as may be necessary to keep the Registration Statement effective for the applicable period set forth in Section 3 or 4 hereof, as applicable, or such shorter period as will terminate when all Transfer Restricted Securities covered by such Registration Statement have been sold; cause the Prospectus to be supplemented by any required Prospectus supplement, and as so supplemented to be filed pursuant to Rule 424 under the Securities Act, and to comply fully with the applicable provisions of Rules 424 and 430A under the Securities Act in a timely manner; and comply with the provisions of the Securities Act with respect to the disposition of all securities covered by such Registration Statement during the applicable period in accordance with the intended method or methods of distribution by the sellers thereof set forth in such Registration Statement or supplement to the Prospectus;

(iii) advise each Holder whose Transfer Restricted Securities have been included in a Shelf Registration Statement, (A) when the Prospectus or any Prospectus supplement or post-effective amendment has been filed, and, with respect to any Registration Statement or any post-effective amendment thereto, when the same has become effective, (B) of any request by the Commission for amendments to the Registration Statement or amendments or supplements to the Prospectus or for additional information relating thereto, (C) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement under the Securities Act or of the suspension by any state securities commission of the qualification of the Transfer

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Restricted Securities for offering or sale in any jurisdiction, or the initiation of any proceeding for any of the preceding purposes, (D) of the happening of any event that makes any statement of a material fact made in the Registration Statement, the Prospectus, any amendment or supplement thereto, or any document incorporated by reference therein untrue, or that requires the making of any additions to or changes in the Registration Statement or the Prospectus in order to make the statements therein not misleading. If at any time the Commission shall issue any stop order suspending the effectiveness of the Registration Statement, or any state securities commission or other regulatory authority shall issue an order suspending the qualification or exemption from qualification of the Transfer Restricted Securities under state securities or blue sky laws, each of the Company and the Guarantors shall use commercially reasonable efforts to obtain the withdrawal or lifting of such order at the earliest possible time;

(iv) in the case of a Shelf Registration Statement, furnish without charge, upon request, to each selling Holder named in any Registration Statement, and each of the underwriter(s), if any, before filing with the Commission, copies of any Registration Statement or any Prospectus included therein or any amendments or supplements to any such Registration Statement or Prospectus (including all documents incorporated by reference after the initial filing of such Registration Statement), which documents will be subject to the review and comment of such Holders and underwriter(s) in connection with such sale, if any, for a period of at least three Business Days, and make the Company’s representatives available for discussion of such documents and other customary due diligence matters, and the Company will not file any such Registration Statement or Prospectus or any amendment or supplement to any such Registration Statement or Prospectus (including all such documents incorporated by reference) to which a Holder of Transfer Restricted Securities covered by such Registration Statement or the underwriter(s), if any, shall reasonably object in writing within three Business Days after the receipt thereof (such objection to be deemed timely made upon confirmation of telecopy transmission within such period). The objection of a Holder or underwriter, if any, shall be deemed to be reasonable if such Registration Statement, amendment, Prospectus or supplement, as applicable, as proposed to be filed, contains a material misstatement or omission. Notwithstanding the foregoing, the Company shall not be required to take any actions under this Section 6(c)(iv) that are not, in the reasonable opinion of counsel for the Company, in compliance with applicable law;

(v) in the case of a Shelf Registration Statement, promptly prior to the filing of any document that is to be incorporated by reference into a Registration Statement or Prospectus in connection with such registration or sale, if any, provide copies of such document to each selling Holder named in the Registration Statement in connection with such exchange, registration or sale, if any, and to the underwriter(s), if any, make the Company’s and the Guarantors’ representatives available for discussion of such document and other customary due diligence matters subject to execution and delivery of customary confidentiality agreements, and include such information in such document prior to the filing thereof as such selling Holders or underwriter(s), if any, reasonably may request;

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(vi) in the case of a Shelf Registration Statement, make available at reasonable times for inspection by the selling Holders, the managing underwriter(s), if any, participating in any disposition pursuant to such Registration Statement and any attorney or accountant retained by such selling Holder or any of the underwriter(s), all financial and other records, pertinent corporate documents and properties of each of the Company and the Guarantors and cause the Company’s and the Guarantors’ officers, directors and employees to supply all information reasonably requested by any such Holder, underwriter, attorney or accountant in connection with such Registration Statement or any post-effective amendment thereto subsequent to the filing thereof and prior to its effectiveness and to participate in meetings with investors to the extent requested by the managing underwriter(s), if any; provided that any Holder or representative thereof requesting or receiving such information shall agree to be bound by reasonable confidentiality agreements and procedures with respect thereto;

(vii) in the case of a Shelf Registration Statement, if requested by any selling Holders or the underwriter(s), if any, promptly incorporate in any Registration Statement or Prospectus, pursuant to a supplement or post-effective amendment if necessary, such information as such selling Holders and underwriter(s), if any, may reasonably request to have included therein, including, without limitation, information relating to the “Plan of Distribution” of the Transfer Restricted Securities, information with respect to the principal amount of Transfer Restricted Securities being sold to such underwriter(s), the purchase price being paid therefor and any other terms of the offering of the Transfer Restricted Securities to be sold in such offering; and make all required filings of such Prospectus supplement or post-effective amendment as soon as practicable after the Company is notified of the matters to be incorporated in such Prospectus supplement or post-effective amendment;

(viii) in the case of a Shelf Registration Statement, upon request, furnish to each selling Holder and each of the underwriter(s), if any, without charge, at least one copy of the Registration Statement, as first filed with the Commission, and of each amendment thereto, including financial statements and schedules (without all documents incorporated by reference therein or exhibits thereto, unless requested);

(ix) in the case of a Shelf Registration Statement, upon request, deliver to each selling Holder and each of the underwriter(s), if any, without charge, as many copies of the Prospectus (including each preliminary prospectus) and any amendment or supplement thereto as such Persons reasonably may request; provided, that if no Registration Statement is effective or no Prospectus is usable in accordance with the provisions of Section 6(b) hereof, the Company shall deliver to each selling Holder a notice to that effect in response to such request; each of the Company and the Guarantors hereby consents to the use (in accordance with law) of the Prospectus and any amendment or supplement thereto by each of the selling Holders and each of the underwriter(s), if any, in connection with the offering and the sale of the Transfer Restricted Securities covered by the Prospectus or any amendment or supplement thereto;

(x) in the case of a Shelf Registration Statement, upon the reasonable request of such Holder, enter into such agreements (including an underwriting agreement

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containing customary terms), and make such representations and warranties, and take all such other actions in connection therewith in order to expedite or facilitate the disposition of the Transfer Restricted Securities pursuant to any Registration Statement contemplated by this Agreement, all to such extent as may be customarily and reasonably requested by any Holder or Holders of Transfer Restricted Securities or underwriter in connection with any sale or resale pursuant to any Registration Statement contemplated by this Agreement; and whether or not an underwriting agreement is entered into and whether or not the registration is an Underwritten Registration, each of the Company and the Guarantors shall:

(A) upon the request of any Holder, furnish to each underwriter, if any, in such substance and scope as they may reasonably request and as are customarily made by issuers to underwriters in primary underwritten offerings, upon the date of the effectiveness of the Shelf Registration Statement:

(1) a certificate in customary form, dated the date of effectiveness of the Shelf Registration Statement, as the case may be, signed by (y) the Chief Executive Officer or any Vice President and (z) a principal financial or accounting officer of the Company and such Guarantor, confirming, as of the date thereof, the matters set forth in paragraphs (i) and (ii) of Section 6(c) of the Purchase Agreement and such other matters as such parties may reasonably request;

(2) an opinion in customary form, dated the date of the effectiveness of the Shelf Registration Statement of counsel for the Company and the Guarantors, covering the matters customarily covered in opinions request in similar underwritten offerings (including so-called “10b-5” letters) and such other matters as such parties may reasonably request; and

(3) use commercially reasonable efforts to obtain a customary comfort letter, dated the date of effectiveness of the Shelf Registration Statement, from the Company’s independent accountants, together with a bring down comfort letter, each in the customary form and covering matters of the type customarily requested to be covered in comfort letters by underwriters in connection with primary underwritten offerings;

(B) deliver such other documents and certificates as may be reasonably requested by such parties to evidence compliance with Section 6(c)(x)(A) hereof and with any customary conditions contained in the underwriting agreement or other agreement entered into by the Company or any of the Guarantors pursuant to this Section 6(c)(x), if any; and

(C) set forth in the underwriting agreement customary indemnification provisions from the Company.

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(xi) prior to any public offering of Transfer Restricted Securities, cooperate with the selling Holders, the underwriter(s), if any, and their respective counsel in connection with the registration and qualification of the Transfer Restricted Securities under the state securities or blue sky laws of such jurisdictions as the selling Holders or underwriter(s), if any, may request and do any and all other acts or things necessary or advisable to enable the disposition in such jurisdictions of the Transfer Restricted Securities covered by the Shelf Registration Statement; provided, however, that none of the Company nor the Guarantors shall be required to register or qualify as a foreign corporation where it is not then so qualified or to take any action that would subject it to the service of process in suits or to taxation, other than as to matters and transactions relating to the Registration Statement, in any jurisdiction where it is not then so subject;

(xii) shall issue, upon the request of any Holder of Transfer Restricted Securities covered by the Shelf Registration Statement, Exchange Securities having an aggregate principal amount equal to the aggregate principal amount of Transfer Restricted Securities surrendered to the Company by such Holder in exchange therefor or being sold by such Holder, such Exchange Securities to be registered in the name of such Holder or in the name of the purchaser(s) of such Securities, as the case may be, and in return, the Transfer Restricted Securities held by such Holder shall be surrendered to the Company for cancellation;

(xiii) cooperate with the selling Holders and the underwriter(s), if any, to facilitate the timely preparation and delivery of certificates representing Transfer Restricted Securities to be sold and not bearing any restrictive legends; and enable such Transfer Restricted Securities to be in such denominations and registered in such names as the Holders or the underwriter(s), if any, may request at least three Business Days prior to any sale of Transfer Restricted Securities made by such Holders or underwriter(s);

(xiv) use commercially reasonable efforts to cause the Transfer Restricted Securities covered by the Registration Statement to be registered with or approved by such other governmental agencies or authorities as may be necessary to enable the seller or sellers thereof or the underwriter(s), if any, to consummate the disposition of such Transfer Restricted Securities, subject to the proviso contained in Section 6(c)(xi) hereof;

(xv) if any fact or event contemplated by Section 6(c)(iii)(D) hereof shall exist or have occurred, prepare a supplement or post-effective amendment to the Registration Statement or related Prospectus or any document incorporated therein by reference or file any other required document so that, as thereafter delivered to the purchasers of Transfer Restricted Securities, the Prospectus will not contain an untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein not misleading;

(xvi) provide a CUSIP number for all Securities not later than the effective date of the Registration Statement covering such Securities and provide the Trustee under the Indenture with printed certificates for such Securities which are in a form eligible for deposit with the Depository Trust Company and take all other action necessary to ensure that all such Securities are eligible for deposit with the Depository Trust Company;

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(xvii) cooperate and assist in any filings required to be made with FINRA and in the performance of any due diligence investigation by any underwriter (including any “qualified independent underwriter”) that is required to be retained in accordance with the rules and regulations of FINRA;

(xviii) otherwise use commercially reasonable efforts to comply with all applicable rules and regulations of the Commission, and make generally available to its security holders, as soon as practicable, a consolidated earnings statement meeting the requirements of Rule 158 under the Securities Act (which need not be audited) for the twelvemonth period commencing after the effective date of the Registration Statement;

(xix) cause the Indenture to be qualified under the Trust Indenture Act not later than the effective date of the first Registration Statement required by this Agreement, and, in connection therewith, cooperate with the Trustee and the Holders of Securities to effect such changes to the Indenture as may be required for such Indenture to be so qualified in accordance with the terms of the Trust Indenture Act; and to execute and use commercially reasonable efforts to cause the Trustee to execute, all documents that may be required to effect such changes and all other forms and documents required to be filed with the Commission to enable such Indenture to be so qualified in a timely manner; and

(xx) to the extent such documents are not electronically filed with the Commission’s Electronic Data Gathering, Analysis and Retrieval system, provide promptly to each Holder upon request each document filed with the Commission pursuant to the requirements of Section 13 and Section 15 of the Exchange Act.

(d) Restrictions on Holders. Each Holder agrees by acquisition of a Transfer Restricted Security that, upon receipt of the notice referred to in Section 6(c)(iii)(C) or any notice from the Company of the existence of any fact of the kind described in Section 6(c)(iii)(D) hereof (in each case, a “Suspension Notice”), such Holder will forthwith discontinue disposition of Transfer Restricted Securities pursuant to the applicable Registration Statement until (i) such Holder’s receipt of the copies of the supplemented or amended Prospectus contemplated by Section 6(c)(xv) hereof, or (ii) it is advised in writing (the “Advice”) by the Company that the use of the Prospectus may be resumed, and has received copies of any additional or supplemental filings that are incorporated by reference in the Prospectus (each, a “Suspension Period”). Each Holder receiving a Suspension Notice hereby agrees that it will either (i) destroy any Prospectuses, other than permanent file copies, then in such Holder’s possession which have been replaced by the Company with more recently dated Prospectuses, or (ii) deliver to the Company (at the Company’s expense) all copies, other than permanent file copies then in such Holder’s possession, of the Prospectus covering such Transfer Restricted Securities that was current at the time of receipt of such notice. In the event the Company shall give any such notice, the time period regarding the effectiveness of such Registration Statement set forth in Section 3 or 4 hereof, as applicable, shall be extended by the number of days during the period from and including the date of the giving of such notice pursuant to Section 6(c)(iii)(D) hereof to and including the date when each selling Holder covered by such Registration Statement shall

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have received the copies of the supplemented or amended Prospectus contemplated by Section 6(c)(xv) hereof or shall have received the Advice; provided, however, that no such extension shall be taken into account in determining whether Additional Interest is due pursuant to Section 5 hereof or the amount of such Additional Interest, it being agreed that the Company’s option to suspend use of a Registration Statement pursuant to this paragraph shall be treated as a Registration Default for purposes of Section 5 hereof.

SECTION 7. Registration Expenses.

(a) All expenses incident to the Company’s and the Guarantors’ performance of or compliance with this Agreement will be borne by the Company and the Guarantors, jointly and severally, regardless of whether a Registration Statement becomes effective, including, without limitation: (i) all registration and filing fees and expenses (including filings made by any Purchaser or Holder with FINRA (and, if applicable, the fees and expenses of any “qualified independent underwriter” and its counsel that may be required by the rules and regulations of FINRA)); (ii) all fees and expenses of compliance with federal securities and state securities or blue sky laws; (iii) all expenses of printing (including printing certificates for the Exchange Securities to be issued in the Exchange Offer and printing of Prospectuses), messenger and delivery services; (iv) all fees and disbursements of counsel for the Company and the Guarantors and, subject to Section 7(b) hereof, reasonable and documented fees and disbursements for one counsel for all of the Holders of Transfer Restricted Securities; (v) all application and filing fees in connection with listing the Exchange Securities on a securities exchange or automated quotation system pursuant to the requirements thereof; (vi) all fees and disbursements of independent certified public accountants of the Company and the Guarantors (including the expenses of any special audit and comfort letters required by or incident to such performance); and (vii) all fees and disbursements of the Trustee and its counsel.

Each of the Company and the Guarantors will, in any event, bear its internal expenses (including, without limitation, all salaries and expenses of its officers and employees performing legal or accounting duties), the expenses of any annual audit and the fees and expenses of any Person, including special experts, retained by the Company or the Guarantors.

(b) In connection with any Registration Statement required by this Agreement (including, without limitation, the Exchange Offer Registration Statement and the Shelf Registration Statement), the Company and the Guarantors, jointly and severally, will reimburse the Purchaser and the Holders of Transfer Restricted Securities being tendered in the Exchange Offer and/or resold pursuant to the “Plan of Distribution” contained in the Exchange Offer Registration Statement or registered pursuant to the Shelf Registration Statement, as applicable, for the reasonable and documented fees and disbursements of not more than one counsel, which shall be chosen by the Holders of a majority in principal amount of the Transfer Restricted Securities for whose benefit such Registration Statement is being prepared.

SECTION 8. Indemnification.

(a) The Company and the Guarantors agree, jointly and severally, to indemnify and hold harmless (i) each Holder and (ii) each Person, if any, who controls (within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act) any Holder (any of the

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Persons referred to in this clause (ii) being hereinafter referred to as a “controlling person”) and (iii) the respective officers, directors, partners, employees, representatives and agents of any Holder or any controlling person (any Person referred to in clause (i), (ii) or (iii) may hereinafter be referred to as an “Indemnified Holder”), to the fullest extent lawful, from and against any and all losses, claims, damages, liabilities, judgments, actions and expenses (including, without limitation, and as incurred, reimbursement of all reasonable out-of-pocket costs of investigating, preparing, pursuing, settling, compromising, paying or defending any claim or action, or any investigation or proceeding by any governmental agency or body, commenced or threatened, including the reasonable fees and expenses of counsel to any Indemnified Holder), joint or several, directly or indirectly caused by, related to, based upon, arising out of or in connection with any untrue statement or alleged untrue statement of a material fact contained in any Registration Statement or Prospectus (or any amendment or supplement thereto), or any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, except insofar as such losses, claims, damages, liabilities or expenses are (i) caused by an untrue statement or omission or alleged untrue statement or omission that is based upon information relating to such Holder furnished in writing to the Company by or on behalf of such Holder expressly for use therein or (ii) out of sales of Transfer Restricted Securities registered on a Registration Statement made during a Suspension Period after notice is given pursuant to Section 6(d) hereof. This indemnity agreement shall be in addition to any liability which the Company or any of the Guarantors may otherwise have.

In case any action or proceeding (including any governmental or regulatory investigation or proceeding) shall be brought or asserted against any of the Indemnified Holders with respect to which indemnity may be sought against the Company or the Guarantors, such Indemnified Holder (or the Indemnified Holder controlled by such controlling person) shall promptly notify the Company and the Guarantors in writing; provided, however, that the failure to give such notice shall not relieve any of the Company or the Guarantors of its obligations pursuant to this Agreement except to the extent that it had been materially prejudiced by such failure. Such Indemnified Holder shall have the right to employ its own counsel in any such action, and the fees and expenses of such counsel shall be paid, as incurred, by the Company and the Guarantors (regardless of whether it is ultimately determined that an Indemnified Holder is not entitled to indemnification hereunder). The Company and the Guarantors shall not, in connection with any one such action or proceeding or separate but substantially similar or related actions or proceedings in the same jurisdiction arising out of the same general allegations or circumstances, be liable for the fees and expenses of more than one separate firm of attorneys (in addition to any local counsel) at any time for such Indemnified Holders, which firm shall be designated by the Holders. The Company and the Guarantors shall be liable for any settlement of any such action or proceeding effected with the Company’s and the Guarantors’ prior written consent, which consent shall not be withheld unreasonably, and each of the Company and the Guarantors agrees to indemnify and hold harmless any Indemnified Holder from and against any loss, claim, damage, liability or reasonable out-of-pocket expense by reason of any settlement of any action effected with the written consent of the Company and the Guarantors. The Company and the Guarantors shall not, without the prior written consent of each Indemnified Holder, settle or compromise or consent to the entry of judgment in or otherwise seek to terminate any pending or threatened action, claim, litigation or proceeding in respect of which indemnification or contribution may be sought hereunder (whether or not any Indemnified Holder is a party

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thereto), unless such settlement, compromise, consent or termination (i) includes an unconditional release of each Indemnified Holder from all liability arising out of such action, claim, litigation or proceeding and (ii) does not include a statement as to an admission of fault, culpability or a failure to act, by or on behalf of the Indemnified Holder.

(b) By its acquisition of Transfer Restricted Securities each Holder of Transfer Restricted Securities agrees, severally and not jointly, to indemnify and hold harmless the Company, the Guarantors and their respective directors and officers of the Company and the Guarantors who sign a Registration Statement, and any Person controlling (within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act) the Company or any of the Guarantors, and the respective officers, directors, partners, employees, representatives and agents of each such Person, to the same extent as the foregoing indemnity from the Company and the Guarantors to each of the Indemnified Holders, but only with respect to claims and actions based on information relating to such Holder furnished in writing by such Holder expressly for use in any Registration Statement. In case any action or proceeding shall be brought against the Company, the Guarantors or their respective directors or officers or any such controlling person in respect of which indemnity may be sought against a Holder of Transfer Restricted Securities, such Holder shall have the rights and duties given the Company and the Guarantors, and the Company, the Guarantors, their respective directors and officers and such controlling person shall have the rights and duties given to each Holder by the preceding paragraph. The liability of any Holder of Transfer Restricted Securities under this Section 8(b) shall not exceed the aggregate net proceeds to such Holder, if any, received from the sale of Transfer Restricted Securities or Exchange Securities pursuant to any Registration Statement.

(c) If the indemnification provided for in this Section 8 is unavailable to an indemnified party under Section 8(a) or (b) hereof (other than by reason of exceptions provided in those Sections) in respect of any losses, claims, damages, liabilities, judgments, actions or expenses referred to therein, then each applicable indemnifying party, in lieu of indemnifying such indemnified party, shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages, liabilities or expenses in such proportion as is appropriate to reflect the relative benefits received by the Company and the Guarantors, on the one hand, and the Holders, on the other hand, from the Initial Placement (which in the case of the Company and the Guarantors shall be deemed to be equal to the total gross proceeds to the Company and the Guarantors from the Initial Placement), the amount of Additional Interest which did not become payable as a result of the filing of the Registration Statement resulting in such losses, claims, damages, liabilities, judgments actions or expenses, and such Registration Statement (and, if applicable, from sales of Transfer Restricted Securities pursuant to a Shelf Registration Statement), or if such allocation is not permitted by applicable law, the relative fault of the Company and the Guarantors, on the one hand, and the Holders, on the other hand, in connection with the statements or omissions which resulted in such losses, claims, damages, liabilities or expenses, as well as any other relevant equitable considerations. The relative fault of the Company, on the one hand, and of the Indemnified Holder, on the other hand, shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company or any of the Guarantors, on the one hand, or the Indemnified Holders, on the other hand, and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The amount paid

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or payable by a party as a result of the losses, claims, damages, liabilities and expenses referred to above shall be deemed to include, subject to the limitations set forth in the second paragraph of Section 8(a) hereof, any legal or other fees or expenses reasonably incurred by such party in connection with investigating or defending any action or claim.

The Company, the Guarantors and each Holder of Transfer Restricted Securities agree that it would not be just and equitable if contribution pursuant to this Section 8(c) were determined by pro rata allocation (even if the Holders were treated as one entity for such purpose) or by any other method of allocation which does not take account of the equitable considerations referred to in the immediately preceding paragraph. The amount paid or payable by an indemnified party as a result of the losses, claims, damages, liabilities or expenses referred to in the immediately preceding paragraph shall be deemed to include, subject to the limitations set forth above, any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this Section 8, the total amount to be contributed by a Holder pursuant to this Section 8 shall be limited to the aggregate net proceeds, if any, received by such Holder from the sale of Transfer Restricted Securities or Exchange Securities pursuant to any Registration Statement. No Person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation. The Holders’ obligations to contribute pursuant to this Section 8(c) are several in proportion to the respective principal amount of Initial Securities held by each of the Holders hereunder and not joint.

SECTION 9. Participation in Underwritten Registrations. No Holder may participate in any Underwritten Registration hereunder unless such Holder (a) agrees to sell such Holder’s Transfer Restricted Securities on the basis provided in any underwriting arrangements approved by the Persons entitled hereunder to approve such arrangements and (b) completes and executes all reasonable questionnaires, powers of attorney, indemnities, underwriting agreements, lockup letters and other documents required under the terms of such underwriting arrangements.

SECTION 10. Selection of Underwriters. The Holders of Transfer Restricted Securities covered by the Shelf Registration Statement who desire to do so may sell such Transfer Restricted Securities in an Underwritten Offering. In any such Underwritten Offering, the investment banker(s) and managing underwriter(s) that will administer such offering will be selected by the Holders of a majority in aggregate principal amount of the Transfer Restricted Securities included in such offering; provided, however, that such investment banker(s) and managing underwriter(s) must be reasonably satisfactory to the Company.

SECTION 11. Miscellaneous.

(a) Remedies. Each of the Company and the Guarantors hereby agrees that monetary damages would not be adequate compensation for any loss incurred by reason of a breach by it of the provisions of this Agreement and hereby agree to waive the defense in any action for specific performance that a remedy at law would be adequate.

(b) No Inconsistent Agreements. Each of the Company and the Guarantors will not on or after the date of this Agreement enter into any agreement with respect to its securities that

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violates the rights granted to the Holders in this Agreement or otherwise conflicts with the provisions hereof. Other than this Agreement, the Registration Rights Agreement for the Second Lien Notes and the Registration Rights Agreement for the Convertible Notes, neither the Company nor any of the Guarantors has entered into any agreement granting any registration rights with respect to its securities to any Person. The rights granted to the Holders hereunder do not in any way conflict with and are not inconsistent with the rights granted to the holders of the Company’s or any of the Guarantors’ securities under any agreement in effect on the date hereof.

(c) Amendments and Waivers. The provisions of this Agreement may not be amended, modified or supplemented, and waivers or consents to or departures from the provisions hereof may not be given unless the Company has (i) in the case of Section 5 hereof and this Section 11(c)(i), obtained the written consent of Holders of all outstanding Transfer Restricted Securities and (ii) in the case of all other provisions hereof, obtained the written consent of Holders of a majority of the outstanding principal amount of Transfer Restricted Securities (excluding any Transfer Restricted Securities held by the Company or its Affiliates). Notwithstanding the foregoing, a waiver or consent to departure from the provisions hereof that relates exclusively to the rights of Holders whose securities are being tendered pursuant to the Exchange Offer and that does not affect directly or indirectly the rights of other Holders whose securities are not being tendered pursuant to such Exchange Offer may be given by the Holders of a majority of the outstanding principal amount of Transfer Restricted Securities being tendered or registered; provided, however, that, with respect to any matter that directly or indirectly affects the rights of the Trustee hereunder, the Company shall obtain the written consent of the Trustee with respect to which such amendment, qualification, supplement, waiver, consent or departure is to be effective.

(d) Notices. All notices and other communications provided for or permitted hereunder shall be made in writing by hand-delivery, first-class mail (registered or certified, return receipt requested), telex, telecopier, or air courier guaranteeing overnight delivery:

(i) if to a Holder, at the address set forth on the records of the Registrar under the Indenture, with a copy to the Registrar under the Indenture; and

(ii) if to the Company:

Horizon Lines, LLC

4064 Colony Road

Suite 200

Charlotte, North Carolina 28211

Fax: (704) 973-7010

Attention: Michael F. Zendan II

With a copy to:

Kirkland & Ellis LLP

601 Lexington Avenue

New York, NY 10022

Fax: (212) 446-6460

Attention: Christian O. Nagler

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All such notices and communications shall be deemed to have been duly given: at the time delivered by hand, if personally delivered; five Business Days after being deposited in the mail, postage prepaid, if mailed; when answered back, if telexed; when receipt acknowledged, if telecopied; and on the next Business Day, if timely delivered to an air courier guaranteeing overnight delivery.

Copies of all such notices, demands or other communications shall be concurrently delivered by the Person giving the same to the Trustee at the address specified in the Indenture.

(e) Successors and Assigns. This Agreement shall inure to the benefit of and be binding upon the successors and assigns of each of the parties, including, without limitation, and without the need for an express assignment, subsequent Holders of Transfer Restricted Securities; provided, however, that this Agreement shall not inure to the benefit of or be binding upon a successor or assign of a Holder unless and to the extent such successor or assign acquired Transfer Restricted Securities from such Holder.

(f) Counterparts. This Agreement may be executed in any number of counterparts and by the parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement.

(g) Headings. The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof.

(h) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE CONFLICTS OF LAW RULES THEREOF.

(i) Severability. In the event that any one or more of the provisions contained herein, or the application thereof in any circumstance, is held invalid, illegal or unenforceable, the validity, legality and enforceability of any such provision in every other respect and of the remaining provisions contained herein shall not be affected or impaired thereby.

(j) Entire Agreement. This Agreement is intended by the parties as a final expression of their agreement and intended to be a complete and exclusive statement of the agreement and understanding of the parties hereto in respect of the subject matter contained herein. There are no restrictions, promises, warranties or undertakings, other than those set forth or referred to herein with respect to the registration rights granted by the Company with respect to the Transfer Restricted Securities. This Agreement supersedes all prior agreements and understandings between the parties with respect to such subject matter.

(k) Use of FWP. No Holder shall use, in any offering registered on a Registration Statement, a Free Writing Prospectus prepared by or on behalf of the relevant Holder or used or referred to by such Holder in connection with the offering of Transfer Restricted Securities without the prior written consent of the Company, which consent shall not be unreasonably withheld.

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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.

HORIZON LINES, LLC.
By:
	Name:
	Title:
HORIZON LINES, INC.
HORIZON LINES HOLDING CORP.
HAWAII STEVEDORES, INC.
HORIZON LINES OF PUERTO RICO, INC.
HORIZON LINES OF ALASKA, LLC
HORIZON LINES OF GUAM, LLC
HORIZON LINES VESSELS, LLC
H-L DISTRIBUTION SERVICE, LLC
HORIZON LOGISTICS, LLC
AERO LOGISTICS, LLC
SEA-LOGIX, LLC
HORIZON SERVICES GROUP, LLC
By:
	Name:
	Title:

The foregoing Registration Rights Agreement is hereby confirmed and accepted as of the date first above written:

By:	Purchasers
By:
	Authorized Signatory:

EX-10.5

Exhibit 10.5

EXECUTION VERSION

REGISTRATION RIGHTS AGREEMENT

by and among

Horizon Lines, LLC

the Guarantors Listed on the Signature Pages hereto

and

Purchasers

Dated as of October 5, 2011

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REGISTRATION RIGHTS AGREEMENT

This Registration Rights Agreement (this “Agreement”) is made and entered into as of October 5, 2011, by and among Horizon Lines, LLC, a Delaware limited liability company (the “Company”), the guarantors listed on Schedule I hereto (collectively, the “Guarantors”) and the Purchasers, governing the Company’s Second Lien Senior Secured Notes due 2016 (the “Initial Notes”), which are fully and unconditionally guaranteed by the Guarantors (the “Guarantees”). The Initial Notes and the Guarantees attached thereto are herein collectively referred to as the “Initial Securities.”

This Agreement is made pursuant to the Purchase Agreement relating to the Initial Notes of even date herewith, (the “Purchase Agreement”), by and among the Company, the Guarantors and the various Purchasers. In order to induce the Purchasers to purchase the Initial Securities, the Company has agreed to provide the registration rights set forth in this Agreement. The execution and delivery of this Agreement is a condition to the obligations of the Purchasers set forth in Section 6(k) of the Purchase Agreement. Capitalized terms used herein and not otherwise defined shall have the meaning assigned to them in the Indenture of even date herewith (as amended or supplemented from time to time, the “Indenture”), by and among the Company, the Guarantors and U.S. Bank National Association, as trustee (the “Trustee”), relating to the Initial Notes and the Exchange Notes (as defined below).

The parties hereby agree as follows:

SECTION 1. Definitions. As used in this Agreement, the following capitalized terms shall have the following meanings:

Additional Interest: As defined in Section 5 hereof.

Advice: As defined in Section 6(d) hereof.

Affiliate: As defined in Rule 144.

Broker-Dealer: Any broker or dealer registered with the Commission under the Exchange Act.

Business Day: Any day other than a Saturday, Sunday or U.S. federal holiday or a day on which banking institutions or trust companies located in New York, New York are authorized or obligated to be closed. If the time to perform any action hereunder falls on a day that is not a Business Day, such time will be extended to the next Business Day and no Additional Interest shall accrue for the intervening period.

Closing Date: The date of this Agreement.

Commission: The Securities and Exchange Commission.

Consummate: An Exchange Offer shall be deemed “Consummated” for purposes of this Agreement upon the occurrence of (i) the filing and effectiveness under the Securities Act of the

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Exchange Offer Registration Statement relating to the Exchange Securities to be issued in the Exchange Offer, (ii) the maintenance of such Exchange Offer Registration Statement continuously effective and the keeping of the Exchange Offer open for a period not less than the minimum period required pursuant to Section 3(b) hereof, and (iii) the delivery by the Company to the Registrar under the Indenture of Exchange Securities in the same aggregate principal amount as the aggregate principal amount of Initial Securities that were validly tendered (and not withdrawn) by Holders thereof pursuant to the Exchange Offer.

Exchange Act: The Securities Exchange Act of 1934.

Exchange Date: As defined in Section 3(a) hereto.

Exchange Offer: The registration by the Company under the Securities Act of the issuance of the Exchange Securities pursuant to a Registration Statement pursuant to which the Company offers the Holders of all outstanding Transfer Restricted Securities the opportunity to exchange all such outstanding Transfer Restricted Securities held by such Holders for Exchange Securities in an aggregate principal amount equal to the aggregate principal amount of the Transfer Restricted Securities tendered in such exchange offer by such Holders.

Exchange Offer Registration Statement: The Registration Statement relating to the Exchange Offer, including the related Prospectus.

Exchange Securities or Exchange Notes: The Second Lien Senior Secured Notes due 2016, of the same series under the Indenture (and having the same rights and provisions, except for registration rights) as the Initial Notes and the Guarantees attached thereto, to be issued to Holders in exchange for Transfer Restricted Securities pursuant to this Agreement in the Exchange Offer.

FINRA: Financial Industry Regulatory Authority, Inc.

Holders: As defined in Section 2(b) hereof.

Indemnified Holder: As defined in Section 8(a) hereof.

Indenture: As defined in the preamble hereto.

Initial Notes: As defined in the preamble hereto.

Initial Placement: The issuance and sale by the Company of the Initial Securities to the Purchasers pursuant to the Purchase Agreements.

Initial Securities: As defined in the preamble hereto.

Interest Payment Date: As defined in the Indenture and the Securities.

Person: An individual, partnership, corporation, trust or unincorporated organization, or a government or agency or political subdivision thereof.

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Prospectus: The prospectus included in a Registration Statement, as amended or supplemented by any prospectus supplement and by all other amendments thereto, including post-effective amendments, and all material incorporated by reference into such Prospectus.

Purchaser: Each “Purchaser” named in a Purchase Agreement.

Registration Default: As defined in Section 5 hereof.

Registration Statement: Any registration statement of the Company and the Guarantors relating to (a) an offering of Exchange Securities pursuant to an Exchange Offer or (b) the registration for resale of Transfer Restricted Securities pursuant to the Shelf Registration Statement, in each case, (i) that is filed pursuant to the provisions of this Agreement, (ii) including the Prospectus included therein, and (iii) including all amendments and supplements thereto (including post-effective amendments) and all exhibits and material incorporated by reference therein.

Restricted Holder: A holder (i) that is an Affiliate of the Company within the meaning of Rule 405 or Rule 144, (ii) who acquires Exchange Notes outside the ordinary course of such holder’s business, (iii) who has arrangements or understandings with any person to participate in the Exchange Offer for the purpose of distributing Exchange Notes and (iv) that is a Broker-Dealer, but only with respect to Exchange Notes received by such Broker-Dealer pursuant to the Exchange Offer in exchange for Transfer Restricted Securities acquired by the Broker-Dealer directly from the Company.

Rule 144: Rule 144 promulgated under the Securities Act.

Securities: The Initial Securities and/or the Exchange Securities, as applicable.

Securities Act: The Securities Act of 1933.

Shelf Effectiveness Deadline: As defined in Section 4(a) hereof.

Shelf Registration Statement: As defined in Section 4(a) hereof.

Transfer Restricted Securities: The Initial Securities; provided that the Initial Securities shall cease to be Transfer Restricted Securities on the earliest to occur of (i) the date on which a Registration Statement with respect to such Initial Securities has become effective under the Securities Act and such Initial Securities have been exchanged or disposed of pursuant to such Registration Statement; (ii) such Initial Securities are sold pursuant to Rule 144 under circumstances in which any legend borne by such Initial Securities relating to restrictions on transferability thereof, under the Securities Act or otherwise, is removed by the Company or pursuant to the Indenture; (iii) the date that is one (1) year after the date of this Agreement, if the holder of such Initial Securities is eligible to dispose of all of the Initial Securities held by such holder within a three (3) month period pursuant to Rule 144(e) (or any successor provision thereto) and the restrictive legend has been removed from all certificates evidencing such Initial Securities; or (iv) the date on which such Initial Securities cease to be outstanding.

Trust Indenture Act: The Trust Indenture Act of 1939.

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Underwritten Registration or Underwritten Offering: A registration in which securities of the Company are sold to an underwriter for reoffering to the public.

SECTION 2. Securities Subject to this Agreement.

(a) Transfer Restricted Securities. The securities entitled to the benefits of this Agreement are the Transfer Restricted Securities.

(b) Holders of Transfer Restricted Securities. A Person, including each Purchaser, is deemed to be a holder of Transfer Restricted Securities (each, a “Holder”) whenever such Person owns Transfer Restricted Securities, whether such Person owns such Transfer Restricted Securities directly or through nominees.

SECTION 3. Registered Exchange Offer.

(a) Unless the Exchange Offer shall not be permissible under applicable law or Commission policy (after the procedures set forth in Section 6(a)(i) hereof have been complied with), or there are no Transfer Restricted Securities outstanding, the Company and the Guarantors shall, as soon as practicable after the Closing Date, (i) cause the Exchange Offer Registration Statement to be filed with the Commission, (ii) use commercially reasonable efforts to cause such Exchange Offer Registration Statement to become effective, (iii) in connection with the foregoing, use commercially reasonable efforts to (A) file all preeffective amendments to such Exchange Offer Registration Statement as may be necessary in order to cause it to become effective, (B) file, if applicable, a post-effective amendment to such Exchange Offer Registration Statement pursuant to Rule 430A under the Securities Act and (C) cause all necessary filings, if any, in connection with the registration and qualification of the Exchange Securities to be made under the state securities or blue sky laws of such jurisdictions as are necessary to permit Consummation of the Exchange Offer, provided, however, that neither the Company nor any Guarantor shall be required to take any action that would subject them to general service of process or taxation in any jurisdiction where they are not already subject, and (iv) upon the effectiveness of such Exchange Offer Registration Statement, commence the Exchange Offer. Each of the Company and the Guarantors shall use commercially reasonable efforts to Consummate the Exchange Offer as soon as practicable after the Closing Date, but in any event not later than 180 days following the Closing Date (such 180th day being the “Exchange Date”). The Exchange Offer, if required pursuant to this Section 3(a), shall be on the appropriate form permitting registration of the Exchange Securities to be offered in exchange for the Transfer Restricted Securities and to permit resales of Initial Securities held by Broker-Dealers as contemplated by Section 3(c) hereof.

(b) If an Exchange Offer Registration Statement is required to be filed and declared effective pursuant to Section 3(a) above, the Company and the Guarantors shall use commercially reasonable efforts to cause the Exchange Offer Registration Statement to be effective continuously, and shall keep the Exchange Offer open for a period of not less than the minimum period required under applicable federal and state securities laws to Consummate the Exchange Offer; provided, however, that in no event shall such period be less than 20 Business Days after the date notice of the Exchange Offer is mailed to the Holders. The Company shall cause the Exchange Offer to comply with all applicable federal and state securities laws. No securities other than the Exchange Securities shall be included in the Exchange Offer Registration Statement.

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(c) The Company shall indicate in a “Plan of Distribution” section contained in the Prospectus forming a part of the Exchange Offer Registration Statement that any Broker-Dealer who holds Transfer Restricted Securities that were acquired for its own account as a result of market-making activities or other trading activities (other than Initial Securities acquired directly from the Company), may exchange such Transfer Restricted Securities pursuant to the Exchange Offer. Such “Plan of Distribution” section shall also contain all other information with respect to such resales by Broker-Dealers that the Commission may require in order to permit such resales pursuant thereto, but such “Plan of Distribution” shall not name any such Broker-Dealer or disclose the amount of Transfer Restricted Securities held by any such Broker-Dealer except to the extent required by the Commission as a result of a change in policy after the date of this Agreement.

Because such Broker-Dealer may be deemed to be an “underwriter” within the meaning of the Securities Act and must, therefore, deliver a prospectus meeting the requirements of the Securities Act in connection with resales of any Exchange Securities received by such Broker-Dealer in the Exchange Offer, the Company and the Guarantors shall permit the use of the Prospectus contained in the Exchange Offer Registration Statement by such Broker-Dealer to satisfy such prospectus delivery requirement. The Company and the Guarantors shall use commercially reasonable efforts to keep the Exchange Offer Registration Statement continuously effective, supplemented and amended as required by the provisions of Section 6(c) hereof to the extent necessary to ensure that it is available for resales of Transfer Restricted Securities acquired by Broker-Dealers for their own accounts as a result of marketmaking activities or other trading activities, and to ensure that it conforms with the requirements of this Agreement, the Securities Act and the policies, rules and regulations of the Commission as announced from time to time, for a period ending on the earlier of (i) 180 days from the date on which the Exchange Offer Registration Statement is declared effective and (ii) the date on which a Broker-Dealer is no longer required to deliver a prospectus in connection with marketmaking or other trading activities.

Upon request, the Company shall provide sufficient copies of the latest version of such Prospectus to such Broker-Dealers within five Business Days after such request at any time during such 180 day (or shorter, as provided in the foregoing sentence) period in order to facilitate such resales.

SECTION 4. Shelf Registration.

(a) Shelf Registration. If (i) the Company and the Guarantors are not required to file an Exchange Offer Registration Statement or to Consummate the Exchange Offer solely because the Exchange Offer is not permitted by applicable law or Commission policy (after the procedures set forth in Section 6(a)(i) hereof have been complied with), (ii) for any reason the Exchange Offer is not Consummated by the Exchange Date, or (iii) prior to the Exchange Date, (A) one or more Purchasers make a request to the Company with respect to Transfer Restricted Securities not eligible to be exchanged for Exchange Securities in the Exchange Offer or (B) any Holder of Transfer Restricted Securities notifies the Company that (1) such Holder is prohibited

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by applicable law or Commission policy from participating in the Exchange Offer, (2) such Holder may not resell the Exchange Securities acquired by it in the Exchange Offer to the public without delivering a prospectus and that the Prospectus contained in the Exchange Offer Registration Statement is not appropriate or available for such resales by such Holder, or (3) such Holder is a Broker-Dealer and holds Transfer Restricted Securities acquired directly from the Company or one of its Affiliates, then the Company and the Guarantors shall use commercially reasonable efforts to cause to be filed and declared effective a shelf registration statement pursuant to Rule 415 under the Securities Act, which may be an amendment to the Exchange Offer Registration Statement (in either event, the “Shelf Registration Statement”), as soon as practicable after the Closing Date and in any event, on or prior to the 90th day after the date such obligation arises pursuant to this clause (such later date being the “Shelf Effectiveness Deadline”), which Shelf Registration Statement shall provide for resales of all Transfer Restricted Securities the Holders of which shall have provided the information required pursuant to Section 4(b) hereof.

Each of the Company and the Guarantors shall use commercially reasonable efforts to keep such Shelf Registration Statement continuously effective, supplemented and amended as required by the provisions of Sections 6(b) and (c) hereof to the extent necessary to ensure that it is available for resales of Transfer Restricted Securities by the Holders of such Securities entitled to the benefit of this Section 4(a), and to ensure that it conforms with the requirements of this Agreement in all material respect, the Securities Act and the policies, rules and regulations of the Commission as announced from time to time, from the date on which the Shelf Registration Statement is declared effective by the Commission until the expiration of the one year period referred to in Rule 144 applicable to securities held by nonaffiliates under the Securities Act (or shorter period that will terminate when all the Transfer Restricted Securities covered by such Shelf Registration Statement have been sold pursuant to such Shelf Registration Statement).

(b) Provision by Holders of Certain Information in Connection with the Shelf Registration Statement. No Holder of Transfer Restricted Securities may include any of its Transfer Restricted Securities in any Shelf Registration Statement pursuant to this Agreement unless and until such Holder furnishes to the Company in writing, within 20 Business Days after receipt of a request therefor, such information as required by Regulation S-K of the Securities Act or, reasonably requested by the Company for use in connection with any Shelf Registration Statement or Prospectus or preliminary Prospectus included therein. No Holder shall be entitled to Additional Interest pursuant to Section 5 hereof unless and until (and from and after such time) such Holder shall have provided all such information. Each Holder as to which any Shelf Registration Statement is being effected agrees to furnish promptly to the Company all information required to be disclosed in order to make the information previously furnished to the Company by such Holder not materially misleading and shall promptly supply such other information as the Company may from time to time reasonably request.

(c) Certification. Within fifteen (15) business days following receipt of written request from the Company by any Holder (which request shall not be made more than once in any calendar year), such Holder shall certify to the Company that such holder continues to hold Transfer Restricted Securities (the “Certification”). If a Holder fails to provide the Certification within the fifteen (15) business day period referred to in the immediately preceding sentence, the Company reserves the right, in its sole discretion, to remove such Holder’s Transfer Restricted

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Securities from a Registration Statement within fifteen (15) business days after receipt by such holder of a second written notice specifying that the Holder may be removed from such Registration Statement unless such holder provides the Certification within such subsequent fifteen (15) business day period. The Company will use commercially reasonable efforts to notify all Holders of the certification request pursuant to this Section 4(c).

SECTION 5. Additional Interest. If (i) the Exchange Offer has not been Consummated by the Exchange Date, (ii) any Shelf Registration Statement, if required hereby, has not been declared effective by the Commission by the Shelf Effectiveness Deadline or (iii) any Registration Statement required by this Agreement has been declared effective but ceases to be effective or otherwise available at any time for more than 60 calendar days in a twelve month period during which it is required to be effective under this Agreement (each such event referred to in clauses (i) through (iii), a “Registration Default”), the Company hereby agrees that the interest rate borne by the Transfer Restricted Securities shall be increased by 0.25% per annum during the 90-day period immediately following the occurrence of any Registration Default and shall increase by 0.25% per annum at the end of each subsequent 90-day period (such increase, “Additional Interest”), but in no event shall such increase exceed 1.00% per annum on the principal amount of Transfer Restricted Securities; provided that the Company and the Guarantors shall in no event be required to pay Additional Interest for more than one Registration Default at any given time. At the cure of all Registration Defaults relating to the particular Transfer Restricted Securities, the interest rate borne by the relevant Transfer Restricted Securities will be reduced to the original interest rate borne by such Transfer Restricted Securities.

All accrued Additional Interest shall be paid by the Company and the Guarantors (or the Company and the Guarantors will cause the Paying Agent to make such payment on their behalf) to the Holders entitled thereto, in the manner provided for the payment of interest in the Indenture, on each Interest Payment Date, as more fully set forth in the Indenture, the Initial Notes and the Exchange Notes. All obligations of the Company and the Guarantors set forth in the preceding paragraph that are outstanding with respect to any Transfer Restricted Security at the time such security ceases to be a Transfer Restricted Security shall survive until such time as all such obligations with respect to such security shall have been satisfied in full.

SECTION 6. Registration Procedures.

(a) Exchange Offer Registration Statement. In connection with the Exchange Offer, if required pursuant to Section 3(a) hereof, the Company and the Guarantors shall comply with all of the provisions of Section 6(c) hereof, shall use commercially reasonable efforts to effect such exchange to permit the sale of Transfer Restricted Securities being sold in accordance with the intended method or methods of distribution thereof, and shall comply with all of the following provisions:

(i) If in the reasonable opinion of counsel to the Company there is a question as to whether the Exchange Offer is permitted by applicable law, each of the Company and the Guarantors hereby agrees to use commercially reasonable efforts to seek a no-action letter or other favorable decision from the Commission allowing the Company and the Guarantors to Consummate an Exchange Offer for such Transfer Restricted

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Securities. Each of the Company and the Guarantors hereby agrees to pursue the issuance of such a decision to the Commission staff level but shall not be required to take commercially unreasonable action to effect a change of Commission policy. In connection with the foregoing, each of the Company and the Guarantors hereby agrees, however, to (A) participate in telephonic conferences with the Commission, (B) deliver to the Commission staff an analysis prepared by counsel to the Company setting forth the legal bases, if any, upon which such counsel has concluded that such an Exchange Offer should be permitted and (C) diligently pursue a resolution (which need not be favorable and which need not be a written resolution) by the Commission staff of such submission.

(ii) As a condition to its participation in the Exchange Offer pursuant to the terms of this Agreement, each Holder of Transfer Restricted Securities (including, without limitation, any Holder who is a Broker-Dealer) shall furnish, upon the request of the Company, prior to the Consummation of the Exchange Offer, a written representation to the Company and the Guarantors (which may be contained in the letter of transmittal contemplated by the Exchange Offer Registration Statement) to the effect that (A) it is not an Affiliate of the Company, (B) it is not engaged in, and does not intend to engage in, and has no arrangement or understanding with any Person to participate in, a distribution of the Exchange Securities to be issued in the Exchange Offer, (C) it is acquiring the Exchange Securities in its ordinary course of business, and (D) only if such Holder is a Broker-Dealer that will receive Exchange Securities in exchange for Initial Securities that such Broker-Dealer acquired for its own private account as a result of market making or other trading activities, it will deliver a Prospectus, as required by law, in connection with any sale of such Exchange Securities. In addition, all such Holders of Transfer Restricted Securities shall otherwise cooperate in the Company’s preparations for the Exchange Offer. As a condition to its participation in the Exchange Offer, each Holder hereby acknowledges and agrees that any Holder that is a Broker-Dealer using the Exchange Offer to participate in a distribution of the securities to be acquired in the Exchange Offer (1) could not, under Commission policy as in effect on the date of this Agreement, rely on the position of the Commission enunciated in Morgan Stanley and Co., Inc.(available June 5, 1991) and Exxon Capital Holdings Corporation (available May 13, 1988), as interpreted in the Commission’s letter to Shearman & Sterling dated July 2, 1993, and similar no-action letters (which may include any no-action letter obtained pursuant to clause (i) above), and (2) must comply with the registration and prospectus delivery requirements of the Securities Act in connection with a secondary resale transaction and that such a secondary resale transaction should be covered by an effective registration statement containing the selling security holder information required by Item 507 or 508, as applicable, of Regulation S-K if the resales are of Exchange Securities obtained by such Holder in exchange for Transfer Restricted Securities acquired by such Holder directly from the Company.

(b) Shelf Registration Statement. If required pursuant to Section 4, in connection with the Shelf Registration Statement, each of the Company and the Guarantors shall comply with all the provisions of Section 6(c) hereof and shall use commercially reasonable efforts to effect such registration to permit the sale of the Transfer Restricted Securities being sold in accordance with the intended method or methods of distribution thereof, and pursuant thereto each of the Company and the Guarantors will as expeditiously as possible prepare and file with

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the Commission a Registration Statement relating to the registration on any appropriate form under the Securities Act, which form shall be available for the sale of the Transfer Restricted Securities in accordance with the intended method or methods of distribution thereof.

(c) General Provisions. In connection with any Registration Statement and any Prospectus required by this Agreement to permit the sale or resale of Transfer Restricted Securities (including, without limitation, any Registration Statement and the related Prospectus required to permit resales of Transfer Restricted Securities by Broker-Dealers), each of the Company and the Guarantors shall:

(i) use commercially reasonable efforts to keep such Registration Statement continuously effective and provide all requisite financial statements (including, if required by the Securities Act or any regulation thereunder, financial statements of the Guarantors) for the period specified in Section 3 or 4 hereof, as applicable; upon the occurrence of any event that would cause any such Registration Statement or the Prospectus contained therein (A) to contain a material misstatement or omission or (B) not to be effective and usable for resale of Transfer Restricted Securities during the period required by this Agreement, the Company shall file promptly an appropriate amendment to such Registration Statement, in the case of clause (A), correcting any such misstatement or omission, and, if Commission review is required, use commercially reasonable efforts to cause such amendment to be declared effective and such Registration Statement and the related Prospectus to become usable for their intended purpose(s) as soon as practicable thereafter;

(ii) use commercially reasonable efforts to prepare and file with the Commission such amendments and post-effective amendments to the applicable Registration Statement as may be necessary to keep the Registration Statement effective for the applicable period set forth in Section 3 or 4 hereof, as applicable, or such shorter period as will terminate when all Transfer Restricted Securities covered by such Registration Statement have been sold; cause the Prospectus to be supplemented by any required Prospectus supplement, and as so supplemented to be filed pursuant to Rule 424 under the Securities Act, and to comply fully with the applicable provisions of Rules 424 and 430A under the Securities Act in a timely manner; and comply with the provisions of the Securities Act with respect to the disposition of all securities covered by such Registration Statement during the applicable period in accordance with the intended method or methods of distribution by the sellers thereof set forth in such Registration Statement or supplement to the Prospectus;

(iii) advise each Holder whose Transfer Restricted Securities have been included in a Shelf Registration Statement, (A) when the Prospectus or any Prospectus supplement or post-effective amendment has been filed, and, with respect to any Registration Statement or any post-effective amendment thereto, when the same has become effective, (B) of any request by the Commission for amendments to the Registration Statement or amendments or supplements to the Prospectus or for additional information relating thereto, (C) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement under the Securities Act or of the suspension by any state securities commission of the qualification of the Transfer

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Restricted Securities for offering or sale in any jurisdiction, or the initiation of any proceeding for any of the preceding purposes, (D) of the happening of any event that makes any statement of a material fact made in the Registration Statement, the Prospectus, any amendment or supplement thereto, or any document incorporated by reference therein untrue, or that requires the making of any additions to or changes in the Registration Statement or the Prospectus in order to make the statements therein not misleading. If at any time the Commission shall issue any stop order suspending the effectiveness of the Registration Statement, or any state securities commission or other regulatory authority shall issue an order suspending the qualification or exemption from qualification of the Transfer Restricted Securities under state securities or blue sky laws, each of the Company and the Guarantors shall use commercially reasonable efforts to obtain the withdrawal or lifting of such order at the earliest possible time;

(iv) in the case of a Shelf Registration Statement, furnish without charge, upon request, to each selling Holder named in any Registration Statement, and each of the underwriter(s), if any, before filing with the Commission, copies of any Registration Statement or any Prospectus included therein or any amendments or supplements to any such Registration Statement or Prospectus (including all documents incorporated by reference after the initial filing of such Registration Statement), which documents will be subject to the review and comment of such Holders and underwriter(s) in connection with such sale, if any, for a period of at least three Business Days, and make the Company’s representatives available for discussion of such documents and other customary due diligence matters, and the Company will not file any such Registration Statement or Prospectus or any amendment or supplement to any such Registration Statement or Prospectus (including all such documents incorporated by reference) to which a Holder of Transfer Restricted Securities covered by such Registration Statement or the underwriter(s), if any, shall reasonably object in writing within three Business Days after the receipt thereof (such objection to be deemed timely made upon confirmation of telecopy transmission within such period). The objection of a Holder or underwriter, if any, shall be deemed to be reasonable if such Registration Statement, amendment, Prospectus or supplement, as applicable, as proposed to be filed, contains a material misstatement or omission. Notwithstanding the foregoing, the Company shall not be required to take any actions under this Section 6(c)(iv) that are not, in the reasonable opinion of counsel for the Company, in compliance with applicable law;

(v) in the case of a Shelf Registration Statement, promptly prior to the filing of any document that is to be incorporated by reference into a Registration Statement or Prospectus in connection with such registration or sale, if any, provide copies of such document to each selling Holder named in the Registration Statement in connection with such exchange, registration or sale, if any, and to the underwriter(s), if any, make the Company’s and the Guarantors’ representatives available for discussion of such document and other customary due diligence matters subject to execution and delivery of customary confidentiality agreements, and include such information in such document prior to the filing thereof as such selling Holders or underwriter(s), if any, reasonably may request;

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(vi) in the case of a Shelf Registration Statement, make available at reasonable times for inspection by the selling Holders, the managing underwriter(s), if any, participating in any disposition pursuant to such Registration Statement and any attorney or accountant retained by such selling Holder or any of the underwriter(s), all financial and other records, pertinent corporate documents and properties of each of the Company and the Guarantors and cause the Company’s and the Guarantors’ officers, directors and employees to supply all information reasonably requested by any such Holder, underwriter, attorney or accountant in connection with such Registration Statement or any post-effective amendment thereto subsequent to the filing thereof and prior to its effectiveness and to participate in meetings with investors to the extent requested by the managing underwriter(s), if any; provided that any Holder or representative thereof requesting or receiving such information shall agree to be bound by reasonable confidentiality agreements and procedures with respect thereto;

(vii) in the case of a Shelf Registration Statement, if requested by any selling Holders or the underwriter(s), if any, promptly incorporate in any Registration Statement or Prospectus, pursuant to a supplement or post-effective amendment if necessary, such information as such selling Holders and underwriter(s), if any, may reasonably request to have included therein, including, without limitation, information relating to the “Plan of Distribution” of the Transfer Restricted Securities, information with respect to the principal amount of Transfer Restricted Securities being sold to such underwriter(s), the purchase price being paid therefor and any other terms of the offering of the Transfer Restricted Securities to be sold in such offering; and make all required filings of such Prospectus supplement or post-effective amendment as soon as practicable after the Company is notified of the matters to be incorporated in such Prospectus supplement or post-effective amendment;

(viii) in the case of a Shelf Registration Statement, upon request, furnish to each selling Holder and each of the underwriter(s), if any, without charge, at least one copy of the Registration Statement, as first filed with the Commission, and of each amendment thereto, including financial statements and schedules (without all documents incorporated by reference therein or exhibits thereto, unless requested);

(ix) in the case of a Shelf Registration Statement, upon request, deliver to each selling Holder and each of the underwriter(s), if any, without charge, as many copies of the Prospectus (including each preliminary prospectus) and any amendment or supplement thereto as such Persons reasonably may request; provided, that if no Registration Statement is effective or no Prospectus is usable in accordance with the provisions of Section 6(b) hereof, the Company shall deliver to each selling Holder a notice to that effect in response to such request; each of the Company and the Guarantors hereby consents to the use (in accordance with law) of the Prospectus and any amendment or supplement thereto by each of the selling Holders and each of the underwriter(s), if any, in connection with the offering and the sale of the Transfer Restricted Securities covered by the Prospectus or any amendment or supplement thereto;

(x) in the case of a Shelf Registration Statement, upon the reasonable request of such Holder, enter into such agreements (including an underwriting agreement

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containing customary terms), and make such representations and warranties, and take all such other actions in connection therewith in order to expedite or facilitate the disposition of the Transfer Restricted Securities pursuant to any Registration Statement contemplated by this Agreement, all to such extent as may be customarily and reasonably requested by any Holder or Holders of Transfer Restricted Securities or underwriter in connection with any sale or resale pursuant to any Registration Statement contemplated by this Agreement; and whether or not an underwriting agreement is entered into and whether or not the registration is an Underwritten Registration, each of the Company and the Guarantors shall:

(A) upon the request of any Holder, furnish to each underwriter, if any, in such substance and scope as they may reasonably request and as are customarily made by issuers to underwriters in primary underwritten offerings, upon the date of the effectiveness of the Shelf Registration Statement:

(1) a certificate in customary form, dated the date of effectiveness of the Shelf Registration Statement, as the case may be, signed by (y) the Chief Executive Officer or any Vice President and (z) a principal financial or accounting officer of the Company and such Guarantor, confirming, as of the date thereof, the matters set forth in paragraphs (i) and (ii) of Section 6(c) of the Purchase Agreement and such other matters as such parties may reasonably request;

(2) an opinion in customary form, dated the date of the effectiveness of the Shelf Registration Statement of counsel for the Company and the Guarantors, covering the matters customarily covered in opinions request in similar underwritten offerings (including so-called “10b-5” letters) and such other matters as such parties may reasonably request; and

(3) use commercially reasonable efforts to obtain a customary comfort letter, dated the date of effectiveness of the Shelf Registration Statement, from the Company’s independent accountants, together with a bring down comfort letter, each in the customary form and covering matters of the type customarily requested to be covered in comfort letters by underwriters in connection with primary underwritten offerings;

(B) deliver such other documents and certificates as may be reasonably requested by such parties to evidence compliance with Section 6(c)(x)(A) hereof and with any customary conditions contained in the underwriting agreement or other agreement entered into by the Company or any of the Guarantors pursuant to this Section 6(c)(x), if any; and

(C) set forth in the underwriting agreement customary indemnification provisions from the Company.

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(xi) prior to any public offering of Transfer Restricted Securities, cooperate with the selling Holders, the underwriter(s), if any, and their respective counsel in connection with the registration and qualification of the Transfer Restricted Securities under the state securities or blue sky laws of such jurisdictions as the selling Holders or underwriter(s), if any, may request and do any and all other acts or things necessary or advisable to enable the disposition in such jurisdictions of the Transfer Restricted Securities covered by the Shelf Registration Statement; provided, however, that none of the Company nor the Guarantors shall be required to register or qualify as a foreign corporation where it is not then so qualified or to take any action that would subject it to the service of process in suits or to taxation, other than as to matters and transactions relating to the Registration Statement, in any jurisdiction where it is not then so subject;

(xii) shall issue, upon the request of any Holder of Transfer Restricted Securities covered by the Shelf Registration Statement, Exchange Securities having an aggregate principal amount equal to the aggregate principal amount of Transfer Restricted Securities surrendered to the Company by such Holder in exchange therefor or being sold by such Holder, such Exchange Securities to be registered in the name of such Holder or in the name of the purchaser(s) of such Securities, as the case may be, and in return, the Transfer Restricted Securities held by such Holder shall be surrendered to the Company for cancellation;

(xiii) cooperate with the selling Holders and the underwriter(s), if any, to facilitate the timely preparation and delivery of certificates representing Transfer Restricted Securities to be sold and not bearing any restrictive legends; and enable such Transfer Restricted Securities to be in such denominations and registered in such names as the Holders or the underwriter(s), if any, may request at least three Business Days prior to any sale of Transfer Restricted Securities made by such Holders or underwriter(s);

(xiv) use commercially reasonable efforts to cause the Transfer Restricted Securities covered by the Registration Statement to be registered with or approved by such other governmental agencies or authorities as may be necessary to enable the seller or sellers thereof or the underwriter(s), if any, to consummate the disposition of such Transfer Restricted Securities, subject to the proviso contained in Section 6(c)(xi) hereof;

(xv) if any fact or event contemplated by Section 6(c)(iii)(D) hereof shall exist or have occurred, prepare a supplement or post-effective amendment to the Registration Statement or related Prospectus or any document incorporated therein by reference or file any other required document so that, as thereafter delivered to the purchasers of Transfer Restricted Securities, the Prospectus will not contain an untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein not misleading;

(xvi) provide a CUSIP number for all Securities not later than the effective date of the Registration Statement covering such Securities and provide the Trustee under the Indenture with printed certificates for such Securities which are in a form eligible for deposit with the Depository Trust Company and take all other action necessary to ensure that all such Securities are eligible for deposit with the Depository Trust Company;

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(xvii) cooperate and assist in any filings required to be made with FINRA and in the performance of any due diligence investigation by any underwriter (including any “qualified independent underwriter”) that is required to be retained in accordance with the rules and regulations of FINRA;

(xviii) otherwise use commercially reasonable efforts to comply with all applicable rules and regulations of the Commission, and make generally available to its security holders, as soon as practicable, a consolidated earnings statement meeting the requirements of Rule 158 under the Securities Act (which need not be audited) for the twelvemonth period commencing after the effective date of the Registration Statement;

(xix) cause the Indenture to be qualified under the Trust Indenture Act not later than the effective date of the first Registration Statement required by this Agreement, and, in connection therewith, cooperate with the Trustee and the Holders of Securities to effect such changes to the Indenture as may be required for such Indenture to be so qualified in accordance with the terms of the Trust Indenture Act; and to execute and use commercially reasonable efforts to cause the Trustee to execute, all documents that may be required to effect such changes and all other forms and documents required to be filed with the Commission to enable such Indenture to be so qualified in a timely manner; and

(xx) to the extent such documents are not electronically filed with the Commission’s Electronic Data Gathering, Analysis and Retrieval system, provide promptly to each Holder upon request each document filed with the Commission pursuant to the requirements of Section 13 and Section 15 of the Exchange Act.

(d) Restrictions on Holders. Each Holder agrees by acquisition of a Transfer Restricted Security that, upon receipt of the notice referred to in Section 6(c)(iii)(C) or any notice from the Company of the existence of any fact of the kind described in Section 6(c)(iii)(D) hereof (in each case, a “Suspension Notice”), such Holder will forthwith discontinue disposition of Transfer Restricted Securities pursuant to the applicable Registration Statement until (i) such Holder’s receipt of the copies of the supplemented or amended Prospectus contemplated by Section 6(c)(xv) hereof, or (ii) it is advised in writing (the “Advice”) by the Company that the use of the Prospectus may be resumed, and has received copies of any additional or supplemental filings that are incorporated by reference in the Prospectus (each, a “Suspension Period”). Each Holder receiving a Suspension Notice hereby agrees that it will either (i) destroy any Prospectuses, other than permanent file copies, then in such Holder’s possession which have been replaced by the Company with more recently dated Prospectuses, or (ii) deliver to the Company (at the Company’s expense) all copies, other than permanent file copies then in such Holder’s possession, of the Prospectus covering such Transfer Restricted Securities that was current at the time of receipt of such notice. In the event the Company shall give any such notice, the time period regarding the effectiveness of such Registration Statement set forth in Section 3 or 4 hereof, as applicable, shall be extended by the number of days during the period from and including the date of the giving of such notice pursuant to Section 6(c)(iii)(D) hereof to and including the date when each selling Holder covered by such Registration Statement shall

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have received the copies of the supplemented or amended Prospectus contemplated by Section 6(c)(xv) hereof or shall have received the Advice; provided, however, that no such extension shall be taken into account in determining whether Additional Interest is due pursuant to Section 5 hereof or the amount of such Additional Interest, it being agreed that the Company’s option to suspend use of a Registration Statement pursuant to this paragraph shall be treated as a Registration Default for purposes of Section 5 hereof.

SECTION 7. Registration Expenses.

(a) All expenses incident to the Company’s and the Guarantors’ performance of or compliance with this Agreement will be borne by the Company and the Guarantors, jointly and severally, regardless of whether a Registration Statement becomes effective, including, without limitation: (i) all registration and filing fees and expenses (including filings made by any Purchaser or Holder with FINRA (and, if applicable, the fees and expenses of any “qualified independent underwriter” and its counsel that may be required by the rules and regulations of FINRA)); (ii) all fees and expenses of compliance with federal securities and state securities or blue sky laws; (iii) all expenses of printing (including printing certificates for the Exchange Securities to be issued in the Exchange Offer and printing of Prospectuses), messenger and delivery services; (iv) all fees and disbursements of counsel for the Company and the Guarantors and, subject to Section 7(b) hereof, reasonable and documented fees and disbursements for one counsel for all of the Holders of Transfer Restricted Securities; (v) all application and filing fees in connection with listing the Exchange Securities on a securities exchange or automated quotation system pursuant to the requirements thereof; (vi) all fees and disbursements of independent certified public accountants of the Company and the Guarantors (including the expenses of any special audit and comfort letters required by or incident to such performance); and (vii) all fees and disbursements of the Trustee and its counsel.

Each of the Company and the Guarantors will, in any event, bear its internal expenses (including, without limitation, all salaries and expenses of its officers and employees performing legal or accounting duties), the expenses of any annual audit and the fees and expenses of any Person, including special experts, retained by the Company or the Guarantors.

(b) In connection with any Registration Statement required by this Agreement (including, without limitation, the Exchange Offer Registration Statement and the Shelf Registration Statement), the Company and the Guarantors, jointly and severally, will reimburse the Purchaser and the Holders of Transfer Restricted Securities being tendered in the Exchange Offer and/or resold pursuant to the “Plan of Distribution” contained in the Exchange Offer Registration Statement or registered pursuant to the Shelf Registration Statement, as applicable, for the reasonable and documented fees and disbursements of not more than one counsel, which shall be chosen by the Holders of a majority in principal amount of the Transfer Restricted Securities for whose benefit such Registration Statement is being prepared.

SECTION 8. Indemnification.

(a) The Company and the Guarantors agree, jointly and severally, to indemnify and hold harmless (i) each Holder and (ii) each Person, if any, who controls (within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act) any Holder (any of the

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Persons referred to in this clause (ii) being hereinafter referred to as a “controlling person”) and (iii) the respective officers, directors, partners, employees, representatives and agents of any Holder or any controlling person (any Person referred to in clause (i), (ii) or (iii) may hereinafter be referred to as an “Indemnified Holder”), to the fullest extent lawful, from and against any and all losses, claims, damages, liabilities, judgments, actions and expenses (including, without limitation, and as incurred, reimbursement of all reasonable out-of-pocket costs of investigating, preparing, pursuing, settling, compromising, paying or defending any claim or action, or any investigation or proceeding by any governmental agency or body, commenced or threatened, including the reasonable fees and expenses of counsel to any Indemnified Holder), joint or several, directly or indirectly caused by, related to, based upon, arising out of or in connection with any untrue statement or alleged untrue statement of a material fact contained in any Registration Statement or Prospectus (or any amendment or supplement thereto), or any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, except insofar as such losses, claims, damages, liabilities or expenses are (i) caused by an untrue statement or omission or alleged untrue statement or omission that is based upon information relating to such Holder furnished in writing to the Company by or on behalf of such Holder expressly for use therein or (ii) out of sales of Transfer Restricted Securities registered on a Registration Statement made during a Suspension Period after notice is given pursuant to Section 6(d) hereof. This indemnity agreement shall be in addition to any liability which the Company or any of the Guarantors may otherwise have.

In case any action or proceeding (including any governmental or regulatory investigation or proceeding) shall be brought or asserted against any of the Indemnified Holders with respect to which indemnity may be sought against the Company or the Guarantors, such Indemnified Holder (or the Indemnified Holder controlled by such controlling person) shall promptly notify the Company and the Guarantors in writing; provided, however, that the failure to give such notice shall not relieve any of the Company or the Guarantors of its obligations pursuant to this Agreement except to the extent that it had been materially prejudiced by such failure. Such Indemnified Holder shall have the right to employ its own counsel in any such action, and the fees and expenses of such counsel shall be paid, as incurred, by the Company and the Guarantors (regardless of whether it is ultimately determined that an Indemnified Holder is not entitled to indemnification hereunder). The Company and the Guarantors shall not, in connection with any one such action or proceeding or separate but substantially similar or related actions or proceedings in the same jurisdiction arising out of the same general allegations or circumstances, be liable for the fees and expenses of more than one separate firm of attorneys (in addition to any local counsel) at any time for such Indemnified Holders, which firm shall be designated by the Holders. The Company and the Guarantors shall be liable for any settlement of any such action or proceeding effected with the Company’s and the Guarantors’ prior written consent, which consent shall not be withheld unreasonably, and each of the Company and the Guarantors agrees to indemnify and hold harmless any Indemnified Holder from and against any loss, claim, damage, liability or reasonable out-of-pocket expense by reason of any settlement of any action effected with the written consent of the Company and the Guarantors. The Company and the Guarantors shall not, without the prior written consent of each Indemnified Holder, settle or compromise or consent to the entry of judgment in or otherwise seek to terminate any pending or threatened action, claim, litigation or proceeding in respect of which indemnification or contribution may be sought hereunder (whether or not any Indemnified Holder is a party

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thereto), unless such settlement, compromise, consent or termination (i) includes an unconditional release of each Indemnified Holder from all liability arising out of such action, claim, litigation or proceeding and (ii) does not include a statement as to an admission of fault, culpability or a failure to act, by or on behalf of the Indemnified Holder.

(b) By its acquisition of Transfer Restricted Securities each Holder of Transfer Restricted Securities agrees, severally and not jointly, to indemnify and hold harmless the Company, the Guarantors and their respective directors and officers of the Company and the Guarantors who sign a Registration Statement, and any Person controlling (within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act) the Company or any of the Guarantors, and the respective officers, directors, partners, employees, representatives and agents of each such Person, to the same extent as the foregoing indemnity from the Company and the Guarantors to each of the Indemnified Holders, but only with respect to claims and actions based on information relating to such Holder furnished in writing by such Holder expressly for use in any Registration Statement. In case any action or proceeding shall be brought against the Company, the Guarantors or their respective directors or officers or any such controlling person in respect of which indemnity may be sought against a Holder of Transfer Restricted Securities, such Holder shall have the rights and duties given the Company and the Guarantors, and the Company, the Guarantors, their respective directors and officers and such controlling person shall have the rights and duties given to each Holder by the preceding paragraph. The liability of any Holder of Transfer Restricted Securities under this Section 8(b) shall not exceed the aggregate net proceeds to such Holder, if any, received from the sale of Transfer Restricted Securities or Exchange Securities pursuant to any Registration Statement.

(c) If the indemnification provided for in this Section 8 is unavailable to an indemnified party under Section 8(a) or (b) hereof (other than by reason of exceptions provided in those Sections) in respect of any losses, claims, damages, liabilities, judgments, actions or expenses referred to therein, then each applicable indemnifying party, in lieu of indemnifying such indemnified party, shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages, liabilities or expenses in such proportion as is appropriate to reflect the relative benefits received by the Company and the Guarantors, on the one hand, and the Holders, on the other hand, from the Initial Placement (which in the case of the Company and the Guarantors shall be deemed to be equal to the total gross proceeds to the Company and the Guarantors from the Initial Placement), the amount of Additional Interest which did not become payable as a result of the filing of the Registration Statement resulting in such losses, claims, damages, liabilities, judgments actions or expenses, and such Registration Statement (and, if applicable, from sales of Transfer Restricted Securities pursuant to a Shelf Registration Statement), or if such allocation is not permitted by applicable law, the relative fault of the Company and the Guarantors, on the one hand, and the Holders, on the other hand, in connection with the statements or omissions which resulted in such losses, claims, damages, liabilities or expenses, as well as any other relevant equitable considerations. The relative fault of the Company, on the one hand, and of the Indemnified Holder, on the other hand, shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company or any of the Guarantors, on the one hand, or the Indemnified Holders, on the other hand, and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The amount paid

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or payable by a party as a result of the losses, claims, damages, liabilities and expenses referred to above shall be deemed to include, subject to the limitations set forth in the second paragraph of Section 8(a) hereof, any legal or other fees or expenses reasonably incurred by such party in connection with investigating or defending any action or claim.

The Company, the Guarantors and each Holder of Transfer Restricted Securities agree that it would not be just and equitable if contribution pursuant to this Section 8(c) were determined by pro rata allocation (even if the Holders were treated as one entity for such purpose) or by any other method of allocation which does not take account of the equitable considerations referred to in the immediately preceding paragraph. The amount paid or payable by an indemnified party as a result of the losses, claims, damages, liabilities or expenses referred to in the immediately preceding paragraph shall be deemed to include, subject to the limitations set forth above, any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this Section 8, the total amount to be contributed by a Holder pursuant to this Section 8 shall be limited to the aggregate net proceeds, if any, received by such Holder from the sale of Transfer Restricted Securities or Exchange Securities pursuant to any Registration Statement. No Person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation. The Holders’ obligations to contribute pursuant to this Section 8(c) are several in proportion to the respective principal amount of Initial Securities held by each of the Holders hereunder and not joint.

SECTION 9. Participation in Underwritten Registrations. No Holder may participate in any Underwritten Registration hereunder unless such Holder (a) agrees to sell such Holder’s Transfer Restricted Securities on the basis provided in any underwriting arrangements approved by the Persons entitled hereunder to approve such arrangements and (b) completes and executes all reasonable questionnaires, powers of attorney, indemnities, underwriting agreements, lockup letters and other documents required under the terms of such underwriting arrangements.

SECTION 10. Selection of Underwriters. The Holders of Transfer Restricted Securities covered by the Shelf Registration Statement who desire to do so may sell such Transfer Restricted Securities in an Underwritten Offering. In any such Underwritten Offering, the investment banker(s) and managing underwriter(s) that will administer such offering will be selected by the Holders of a majority in aggregate principal amount of the Transfer Restricted Securities included in such offering; provided, however, that such investment banker(s) and managing underwriter(s) must be reasonably satisfactory to the Company.

SECTION 11. Miscellaneous.

(a) Remedies. Each of the Company and the Guarantors hereby agrees that monetary damages would not be adequate compensation for any loss incurred by reason of a breach by it of the provisions of this Agreement and hereby agree to waive the defense in any action for specific performance that a remedy at law would be adequate.

(b) No Inconsistent Agreements. Each of the Company and the Guarantors will not on or after the date of this Agreement enter into any agreement with respect to its securities that

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violates the rights granted to the Holders in this Agreement or otherwise conflicts with the provisions hereof. Other than this Agreement, the Registration Rights Agreement for the Second Lien Notes and the Registration Rights Agreement for the Convertible Notes, neither the Company nor any of the Guarantors has entered into any agreement granting any registration rights with respect to its securities to any Person. The rights granted to the Holders hereunder do not in any way conflict with and are not inconsistent with the rights granted to the holders of the Company’s or any of the Guarantors’ securities under any agreement in effect on the date hereof.

(c) Amendments and Waivers. The provisions of this Agreement may not be amended, modified or supplemented, and waivers or consents to or departures from the provisions hereof may not be given unless the Company has (i) in the case of Section 5 hereof and this Section 11(c)(i), obtained the written consent of Holders of all outstanding Transfer Restricted Securities and (ii) in the case of all other provisions hereof, obtained the written consent of Holders of a majority of the outstanding principal amount of Transfer Restricted Securities (excluding any Transfer Restricted Securities held by the Company or its Affiliates). Notwithstanding the foregoing, a waiver or consent to departure from the provisions hereof that relates exclusively to the rights of Holders whose securities are being tendered pursuant to the Exchange Offer and that does not affect directly or indirectly the rights of other Holders whose securities are not being tendered pursuant to such Exchange Offer may be given by the Holders of a majority of the outstanding principal amount of Transfer Restricted Securities being tendered or registered; provided, however, that, with respect to any matter that directly or indirectly affects the rights of the Trustee hereunder, the Company shall obtain the written consent of the Trustee with respect to which such amendment, qualification, supplement, waiver, consent or departure is to be effective.

(d) Notices. All notices and other communications provided for or permitted hereunder shall be made in writing by hand-delivery, first-class mail (registered or certified, return receipt requested), telex, telecopier, or air courier guaranteeing overnight delivery:

(i) if to a Holder, at the address set forth on the records of the Registrar under the Indenture, with a copy to the Registrar under the Indenture; and

(ii) if to the Company:

Horizon Lines, LLC

4064 Colony Road

Suite 200

Charlotte, North Carolina 28211

Fax: (704) 973-7010

Attention: Michael F. Zendan II

With a copy to:

Kirkland & Ellis LLP

601 Lexington Avenue

New York, NY 10022

Fax: (212) 446-6460

Attention: Christian O. Nagler

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All such notices and communications shall be deemed to have been duly given: at the time delivered by hand, if personally delivered; five Business Days after being deposited in the mail, postage prepaid, if mailed; when answered back, if telexed; when receipt acknowledged, if telecopied; and on the next Business Day, if timely delivered to an air courier guaranteeing overnight delivery.

Copies of all such notices, demands or other communications shall be concurrently delivered by the Person giving the same to the Trustee at the address specified in the Indenture.

(e) Successors and Assigns. This Agreement shall inure to the benefit of and be binding upon the successors and assigns of each of the parties, including, without limitation, and without the need for an express assignment, subsequent Holders of Transfer Restricted Securities; provided, however, that this Agreement shall not inure to the benefit of or be binding upon a successor or assign of a Holder unless and to the extent such successor or assign acquired Transfer Restricted Securities from such Holder.

(f) Counterparts. This Agreement may be executed in any number of counterparts and by the parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement.

(g) Headings. The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof.

(h) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE CONFLICTS OF LAW RULES THEREOF.

(i) Severability. In the event that any one or more of the provisions contained herein, or the application thereof in any circumstance, is held invalid, illegal or unenforceable, the validity, legality and enforceability of any such provision in every other respect and of the remaining provisions contained herein shall not be affected or impaired thereby.

(j) Entire Agreement. This Agreement is intended by the parties as a final expression of their agreement and intended to be a complete and exclusive statement of the agreement and understanding of the parties hereto in respect of the subject matter contained herein. There are no restrictions, promises, warranties or undertakings, other than those set forth or referred to herein with respect to the registration rights granted by the Company with respect to the Transfer Restricted Securities. This Agreement supersedes all prior agreements and understandings between the parties with respect to such subject matter.

(k) Use of FWP. No Holder shall use, in any offering registered on a Registration Statement, a Free Writing Prospectus prepared by or on behalf of the relevant Holder or used or referred to by such Holder in connection with the offering of Transfer Restricted Securities without the prior written consent of the Company, which consent shall not be unreasonably withheld.

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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.

HORIZON LINES, LLC.
By:
	Name:
	Title:
HORIZON LINES, INC.
HORIZON LINES HOLDING CORP.
HAWAII STEVEDORES, INC.
HORIZON LINES OF PUERTO RICO, INC.
HORIZON LINES OF ALASKA, LLC
HORIZON LINES OF GUAM, LLC
HORIZON LINES VESSELS, LLC
H-L DISTRIBUTION SERVICE, LLC
HORIZON LOGISTICS, LLC
AERO LOGISTICS, LLC
SEA-LOGIX, LLC
HORIZON SERVICES GROUP, LLC
By:
	Name:
	Title:

The foregoing Registration Rights Agreement is hereby confirmed and accepted as of the date first above written:

By:	Purchasers
By:
	Authorized Signatory:

EX-10.6

Exhibit 10.6

Execution Version

CREDIT AGREEMENT

Dated as of October 5, 2011

by and among

HORIZON LINES, INC.,

as Parent,

HORIZON LINES, LLC,

as Borrower,

THE LENDERS THAT ARE SIGNATORIES HERETO,

as the Lenders,

and

WELLS FARGO CAPITAL FINANCE, LLC,

as Administrative Agent

WELLS FARGO CAPITAL FINANCE, LLC,

as Sole Lead Arranger and Sole Bookrunner

TABLE OF CONTENTS

		Page
1.	DEFINITIONS AND CONSTRUCTION		1
1.1	Definitions		1
1.2	Accounting Terms		1
1.3	Code		2
1.4	Construction		2
1.5	Schedules and Exhibits		2
2.	LOANS AND TERMS OF PAYMENT		3
2.1	Revolver Loans		3
2.2	Reserved		3
2.3	Borrowing Procedures and Settlements		3
2.4	Payments; Reductions of Revolver Commitments; Prepayments		10
2.5	Overadvances		15
2.6	Interest Rates and Letter of Credit Fee: Rates, Payments, and Calculations		15
2.7	Crediting Payments		17
2.8	Designated Account		17
2.9	Maintenance of Loan Account; Statements of Obligations		17
2.10	Fees		18
2.11	Letters of Credit		18
2.12	LIBOR Option		23
2.13	Capital Requirements		25
2.14	Increase Option		27
3.	CONDITIONS; TERM OF AGREEMENT		28
3.1	Conditions Precedent to the Initial Extension of Credit		28
3.2	Conditions Precedent to all Extensions of Credit		28
3.3	Maturity		28
3.4	Effect of Maturity		29
3.5	Early Termination by Borrower		29
3.6	Conditions Subsequent, Etc.		29
4.	REPRESENTATIONS AND WARRANTIES		29
4.1	Due Organization and Qualification; Subsidiaries		29
4.2	Due Authorization; No Conflict		30
4.3	Governmental Consents		30
4.4	Binding Obligations; Perfected Liens		31
4.5	Title to Assets; No Encumbrances		31
4.6	Jurisdiction of Organization; Location of Chief Executive Office; Organizational Identification Number; Commercial Tort Claims		32
4.7	Litigation		32
4.8	Compliance with Laws		32

i

4.9	No Material Adverse Change	32
4.10	Fraudulent Transfer	33
4.11	Employee Benefits	33
4.12	Environmental Condition	34
4.13	Intellectual Property	34
4.14	Leases	34
4.15	Deposit Accounts and Securities Accounts	34
4.16	Complete Disclosure	34
4.17	Material Contracts	35
4.18	Patriot Act	35
4.19	Indebtedness	35
4.20	Payment of Taxes	35
4.21	Margin Stock	36
4.22	Governmental Regulation	36
4.23	OFAC	36
4.24	Employee and Labor Matters	36
4.25	Eligible Accounts	36
4.26	Owned and Leased Locations	37
4.27	Reserved	37
4.28	Vessels	37
4.29	Jones Act Trade	37
5.	AFFIRMATIVE COVENANTS	38
5.1	Financial Statements, Reports, Certificates	38
5.2	Collateral Reporting	38
5.3	Existence	38
5.4	Maintenance of Properties	38
5.5	Taxes	38
5.6	Insurance	39
5.7	Inspection	39
5.8	Compliance with Laws	40
5.9	Environmental	40
5.10	Disclosure Updates	40
5.11	Formation of Subsidiaries, Etc.	41
5.12	Further Assurances	42
5.13	Lender Meetings	43
5.14	Material Contracts	43
5.15	Location of Books and Records	43
5.16	Compliance with ERISA	43
5.17	Jones Act Trade	44
5.18	Antitrust Judgment Lien	44
6.	NEGATIVE COVENANTS	44
6.1	Indebtedness	44
6.2	Liens	44
6.3	Restrictions on Fundamental Changes	44

ii

6.4	Disposal of Assets	45
6.5	Change Name	45
6.6	Nature of Business	45
6.7	Prepayments and Amendments	45
6.8	Change of Control	46
6.9	Restricted Stock Payments	46
6.10	Accounting Methods	46
6.11	Investments; Controlled Investments	46
6.12	Transactions with Affiliates	46
6.13	Use of Proceeds	47
6.14	Limitation on Issuance of Stock	47
6.15	Restrictions Affecting Subsidiaries	48
7.	FIXED CHARGE COVERAGE RATIO	49
8.	EVENTS OF DEFAULT	49
8.1	Payment Default	49
8.2	Covenant Default	49
8.3	Judgments	50
8.4	Voluntary Insolvency Proceeding	50
8.5	Involuntary Insolvency Proceeding	50
8.6	Restriction on Business	50
8.7	Cross Default	50
8.8	Misrepresentation	51
8.9	Failure of Guaranty	51
8.10	Failure of other Loan Documents	51
8.11	Invalidity of Loan Documents	51
8.12	ERISA Events	52
8.13	Designation as Senior Indebtedness	52
8.14	Chartered Vessel Document Default	52
8.15	Attachment/Levy Default	52
8.16	Jones Act Trade	53
9.	RIGHTS AND REMEDIES	53
9.1	Rights and Remedies	53
9.2	Remedies Cumulative	53
10.	WAIVERS; INDEMNIFICATION	54
10.1	Demand; Protest; etc.	54
10.2	The Lender Group’s Liability for Collateral	54
10.3	Indemnification	54

iii

11.	NOTICES	55
12.	CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER	56
13.	ASSIGNMENTS AND PARTICIPATIONS; SUCCESSORS	57
13.1	Assignments and Participations	57
13.2	Successors	61
14.	AMENDMENTS; WAIVERS	61
14.1	Amendments and Waivers	61
14.2	Replacement of Certain Lenders	63
14.3	No Waivers; Cumulative Remedies	64
15.	AGENT; THE LENDER GROUP	64
15.1	Appointment and Authorization of Agent	64
15.2	Delegation of Duties	65
15.3	Liability of Agent	66
15.4	Reliance by Agent	66
15.5	Notice of Default or Event of Default	66
15.6	Credit Decision	67
15.7	Costs and Expenses; Indemnification	67
15.8	Agent in Individual Capacity	68
15.9	Successor Agent	68
15.10	Lender in Individual Capacity	69
15.11	Collateral Matters	69
15.12	Restrictions on Actions by Lenders; Sharing of Payments	71
15.13	Agency for Perfection	72
15.14	Payments by Agent to Lenders	72
15.15	Concerning the Collateral and Related Loan Documents	72
15.16	Audits and Examination Reports; Confidentiality; Disclaimers by Lenders; Other Reports and Information	72
15.17	Several Obligations; No Liability	73
15.18	Intercreditor Agreement	74
16.	TAXES	74
17.	GENERAL PROVISIONS	78
17.1	Effectiveness	78
17.2	Section Headings	78
17.3	Interpretation	78
17.4	Severability of Provisions	78
17.5	Bank Product Providers	78
17.6	Debtor-Creditor Relationship	79
17.7	Counterparts; Electronic Execution	79
17.8	Revival and Reinstatement of Obligations	79

iv

17.9	Confidentiality	80
17.10	Lender Group Expenses	81
17.11	Survival	81
17.12	Patriot Act	81
17.13	Integration	81

v

SCHEDULES AND EXHIBITS

Schedule 1.1	Definitions
Schedule 3.1	Conditions Precedent
Schedule 3.6	Conditions Subsequent
Schedule 4.1	Capitalization of Parent’s Subsidiaries
Schedule 4.6(a)	States of Organization
Schedule 4.6(b)	Chief Executive Offices
Schedule 4.6(c)	Organizational Identification Numbers
Schedule 4.6(d)	Commercial Tort Claims
Schedule 4.7	Litigation
Schedule 4.12	Environmental Matters
Schedule 4.13	Intellectual Property
Schedule 4.15	Deposit Accounts and Securities Accounts
Schedule 4.17	Material Contracts
Schedule 4.19	Permitted Indebtedness
Schedule 4.26	Locations of Inventory and Equipment
Schedule 4.28	Vessels
Schedule 5.1	Financial Statements, Reports, Certificates
Schedule 5.2	Collateral Reporting
Schedule 6.12	Affiliate Transactions
Schedule A-1	Agent’s Account
Schedule A-2	Authorized Persons
Schedule C-1	Revolver Commitments
Schedule D-1	Designated Account
Schedule E-1	Existing Letters of Credit
Schedule P-1	Permitted Investments
Schedule P-2	Permitted Liens
Schedule R-1	Real Property Collateral
Schedule V-1	Chartered Vessel Documents
Exhibit A-1	Form of Assignment and Acceptance
Exhibit B-1	Form of Borrowing Base Certificate
Exhibit B-2	Form of Bank Products Provider Agreement
Exhibit C-1	Form of Compliance Certificate
Exhibit L-1	Form of LIBOR Notice

vi

CREDIT AGREEMENT

THIS CREDIT AGREEMENT (this “Agreement”), is entered into as of October 5, 2011, by and among the lenders identified on the signature pages hereof (each of such lenders, together with their respective successors and permitted assigns, are referred to hereinafter as a “Lender”, as that term is hereinafter further defined), WELLS FARGO CAPITAL FINANCE, LLC, a Delaware limited liability company, as administrative agent for the Lenders (in such capacity, together with its successors and assigns in such capacity, “Agent”), HORIZON LINES, INC., a Delaware corporation (“Parent”) and HORIZON LINES, LLC, a Delaware corporation (“Borrower”).

The parties agree as follows:

1. DEFINITIONS AND CONSTRUCTION.

1.1 Definitions. Capitalized terms used in this Agreement shall have the meanings specified therefor on Schedule 1.1.

1.2 Accounting Terms. All accounting terms not specifically defined herein shall be construed in accordance with GAAP; provided, however, that if Borrower notifies Agent that Borrower requests an amendment to any provision hereof to eliminate the effect of any Accounting Change occurring after the Closing Date or in the application thereof on the operation of such provision (or if Agent notifies Borrower that the Required Lenders request an amendment to any provision hereof for such purpose), regardless of whether any such notice is given before or after such Accounting Change or in the application thereof, then Agent and Borrower agree that they will negotiate in good faith amendments to the provisions of this Agreement that are directly affected by such Accounting Change with the intent of having the respective positions of the Lenders and Borrower after such Accounting Change conform as nearly as possible to their respective positions as of the date of this Agreement and, until any such amendments have been agreed upon and agreed to by the Required Lenders, the provisions in this Agreement shall be calculated as if no such Accounting Change had occurred. When used herein, the term “financial statements” shall include the notes and schedules thereto. Whenever the term “Parent” is used in respect of a financial covenant or a related definition, it shall be understood to mean Parent and its Subsidiaries on a consolidated basis, unless the context clearly requires otherwise.

Notwithstanding anything herein to the contrary (a) any change in GAAP that would result in a lease that is classified and accounted for as an operating lease as of the Closing Date being treated as a Capital Lease (or being given a substantially similar treatment) shall not be given effect in the definition of Indebtedness or any related definitions or in the computation of any financial ratio or requirement set forth in any Loan Document and (b) if the Borrower notifies Agent that it or Parent is required to report under International Financial Reporting Standards (“IFRS”), or has elected to do so through an early-adoption policy, “GAAP” shall mean international financial reporting standards pursuant to IFRS (provided that after such conversion, (i) the Borrower cannot elect to report under U.S. generally accepted accounting principles and (ii) the Borrower shall reconcile the two financial computation methods under IFRS and GAAP in a manner reasonably acceptable to Agent).

1.3 Code. Any terms used in this Agreement that are defined in the Code shall be construed and defined as set forth in the Code unless otherwise defined herein; provided, however, that to the extent that the Code is used to define any term herein and such term is defined differently in different Articles of the Code, the definition of such term contained in Article 9 of the Code shall govern.

1.4 Construction. Unless the context of this Agreement or any other Loan Document clearly requires otherwise, references to the plural include the singular, references to the singular include the plural, the terms “includes” and “including” are not limiting, and the term “or” has, except where otherwise indicated, the inclusive meaning represented by the phrase “and/or.” The words “hereof,” “herein,” “hereby,” “hereunder,” and similar terms in this Agreement or any other Loan Document refer to this Agreement or such other Loan Document, as the case may be, as a whole and not to any particular provision of this Agreement or such other Loan Document, as the case may be. Section, subsection, clause, schedule, and exhibit references herein are to this Agreement unless otherwise specified. Any reference in this Agreement or in any other Loan Document to any agreement, instrument, or document shall include all alterations, amendments, changes, extensions, modifications, renewals, replacements, substitutions, joinders, and supplements, thereto and thereof, as applicable (subject to any restrictions on such alterations, amendments, changes, extensions, modifications, renewals, replacements, substitutions, joinders, and supplements set forth herein). The words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties. Any reference herein or in any other Loan Document to the satisfaction, repayment, or payment in full of the Obligations shall mean the repayment in full in cash or immediately available funds (or, (a) in the case of contingent reimbursement obligations with respect to Letters of Credit, providing Letter of Credit Collateralization, and (b) in the case of obligations with respect to Bank Products (other than Hedge Obligations), providing Bank Product Collateralization) of all of the Obligations (including the payment of any Lender Group Expenses that have accrued irrespective of whether demand has been made therefor and the payment of any termination amount then applicable (or which would or could become applicable as a result of the repayment of the other Obligations) under Hedge Agreements provided by Hedge Providers) other than (i) Contingent Obligations, (ii) any Bank Product Obligations (other than Hedge Obligations) that, at such time, are allowed by the applicable Bank Product Provider to remain outstanding without being required to be repaid or cash collateralized, and (iii) any Hedge Obligations that, at such time, are allowed by the applicable Hedge Provider to remain outstanding without being required to be repaid. Any reference herein to any Person shall be construed to include such Person’s successors and assigns. Any requirement of a writing contained herein or in any other Loan Document shall be satisfied by the transmission of a Record.

1.5 Schedules and Exhibits. All of the schedules and exhibits attached to this Agreement shall be deemed incorporated herein by reference.

2

2. LOANS AND TERMS OF PAYMENT.

2.1 Revolver Loans.

(a) Subject to the terms and conditions of this Agreement, and during the term of this Agreement, each Lender with a Revolver Commitment agrees (severally, not jointly or jointly and severally) to make revolving loans (“Revolver Loans”) to Borrower in an aggregate amount (after giving effect to such Revolver Loans) at any one time outstanding not to exceed the lesser of:

(i) such Lender’s Revolver Commitment, and

(ii) such Lender’s Pro Rata Share of an amount equal to (A) the lesser of (1) the Maximum Revolver Amount and (2) the Borrowing Base at such time minus (B) the sum of (1) the Letter of Credit Usage at such time, plus (2) the principal amount of Swing Loans outstanding at such time.

(b) Amounts borrowed pursuant to this Section 2.1 may be repaid and, subject to the terms and conditions of this Agreement, reborrowed at any time during the term of this Agreement. The outstanding principal amount of the Advances, together with interest accrued and unpaid thereon, shall be due and payable on the Maturity Date or, if earlier, on the date on which they are declared due and payable pursuant to the terms of this Agreement.

(c) Anything to the contrary in this Section 2.1 notwithstanding, Agent shall have the right (but not the obligation) to establish, increase, reduce, eliminate, or otherwise adjust reserves from time to time against the Borrowing Base or the Maximum Revolver Amount in such amounts, and with respect to such matters, as Agent in its Permitted Discretion shall deem necessary or appropriate, including (i) reserves in an amount equal to the Bank Product Reserve Amount, (ii) reserves in an amount equal to the Dilution Reserve, (iii) reserves in an amount equal to 1 month’s rent with respect to any leased property where books and records pertaining to ABL Priority Collateral of a Loan Party are located, unless a Collateral Access Agreement for such location has been obtained and (iv) reserves with respect to (A) sums that Parent or its Subsidiaries are required to pay under this Agreement or any other Loan Document (such as taxes, assessments, insurance premiums, or, in the case of leased assets, rents or other amounts payable under such leases) and has failed to pay when due, and (B) amounts owing by Parent or its Subsidiaries to any Person to the extent secured by a Lien (including the Antitrust Judgment Lien) on, or trust over, any of the ABL Priority Collateral (other than a Permitted Lien which is a permitted purchase money Lien or the interest of a lessor under a Capital Lease), which Lien or trust, in the Permitted Discretion of Agent likely would have a priority superior to Agent’s Liens (such as Liens or trusts in favor of landlords, warehousemen, carriers, mechanics, materialmen, laborers, or suppliers, or Liens or trusts for ad valorem, excise, sales, or other taxes where given priority under applicable law) in and to such item of the ABL Priority Collateral; provided that, in each case, reserves established by Agent and in effect on the Closing Date, if any, shall be mutually agreed upon by Borrower and Agent.

2.2 Reserved.

2.3 Borrowing Procedures and Settlements.

(a) Procedure for Borrowing. Each Borrowing shall be made by a written request by an Authorized Person delivered to Agent. Unless Swing Lender is not obligated to

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make a Swing Loan pursuant to Section 2.3(b) below, such notice must be received by Agent no later than 2:00 p.m. (New York time) on the Business Day that is the requested Funding Date specifying (i) the amount of such Borrowing, and (ii) the requested Funding Date, which shall be a Business Day; provided, however, that if Swing Lender is not obligated to make a Swing Loan as to a requested Borrowing, such notice must be received by Agent no later than 2:00 p.m. (New York time) on the Business Day prior to the date that is the requested Funding Date (or, if WFCF is the sole Lender at such time, such request shall be effective if received by Agent not later than 1:00 p.m. (New York time) on the Funding Date applicable thereto). At Agent’s election, in lieu of delivering the above-described written request, any Authorized Person may give Agent telephonic notice of such request by the required time. In such circumstances, Borrower agrees that any such telephonic notice will be confirmed in writing within 24 hours of the giving of such telephonic notice, but the failure to provide such written confirmation shall not affect the validity of the request.

(b) Making of Swing Loans. In the case of a request for an Advance and so long as either (i) the aggregate amount of Swing Loans made since the last Settlement Date, minus the amount of Collections or payments applied to Swing Loans since the last Settlement Date, plus the amount of the requested Advance does not exceed $15,000,000, or (ii) Swing Lender, in its sole discretion, shall agree to make a Swing Loan notwithstanding the foregoing limitation, Swing Lender shall make an Advance in the amount of such requested Borrowing (any such Advance made solely by Swing Lender pursuant to this Section 2.3(b) being referred to as a “Swing Loan” and such Advances being referred to as “Swing Loans”) available to Borrower on the Funding Date applicable thereto by transferring immediately available funds to the Designated Account. Anything contained herein to the contrary notwithstanding, the Swing Lender may, but shall not be obligated to, make Swing Loans at any time that one or more of the Lenders is a Defaulting Lender. Each Swing Loan shall be deemed to be an Advance hereunder and shall be subject to all the terms and conditions (including Section 3) applicable to other Advances, except that all payments on any Swing Loan shall be payable to Swing Lender solely for its own account. Subject to the provisions of Section 2.3(d)(ii), Swing Lender shall not make and shall not be obligated to make any Swing Loan if Swing Lender has actual knowledge that (A) one or more of the applicable conditions precedent set forth in Section 3 will not be satisfied on the requested Funding Date for the applicable Borrowing, or (B) the requested Borrowing (together with all other outstanding Revolver Usage) would exceed the lesser of (1) the Maximum Revolver Amount and (2) the Borrowing Base on such Funding Date. Swing Lender shall not otherwise be required to determine whether the applicable conditions precedent set forth in Section 3 have been satisfied on the Funding Date applicable thereto prior to making any Swing Loan. The Swing Loans shall be secured by Agent’s Liens, constitute Advances and Obligations hereunder, and bear interest at the rate applicable from time to time to Advances that are Base Rate Loans. Immediately upon the making of a Swing Loan, each Lender shall be deemed to, and hereby irrevocably and unconditionally agrees to, purchase from the Swing Lender a risk participation in such Swing Loan in an amount equal to such Lender’s Pro Rata share of the amount of such Swing Loan.

(c) Making of Revolver Loans.

(i) In the event that Swing Lender is not obligated to make a Swing Loan, then promptly after receipt of a request for a Borrowing pursuant to Section 2.3(a),

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Agent shall notify Lenders, not later than 4:00 p.m. (New York time) on the Business Day immediately preceding the Funding Date applicable thereto (provided that, so long as WFCF is the sole Lender, such notice shall be deemed so delivered if the notice of Borrower under Section 2.3(a) is received by Agent not later than 1:00 p.m. (New York time) on the Funding Date applicable thereto), by telecopy, telephone, or other similar form of transmission, of the requested Borrowing. Each Lender shall make the amount of such Lender’s Pro Rata Share of the requested Borrowing available to Agent in immediately available funds, to Agent’s Account, not later than 1:00 p.m. (New York time) on the Funding Date applicable thereto. After Agent’s receipt of the proceeds of such Advances, Agent shall make the proceeds thereof available to Borrower on the applicable Funding Date by transferring immediately available funds equal to such proceeds received by Agent to the Designated Account; provided, however, that, subject to the provisions of Section 2.3(d)(ii), Agent shall not request any Lender to make any Advance if it has knowledge that, and no Lender shall have the obligation to make any Advance, if (A) one or more of the applicable conditions precedent set forth in Section 3 will not be satisfied on the requested Funding Date for the applicable Borrowing unless such condition has been waived, or (B) the requested Borrowing (together with all other outstanding Revolver Usage) would exceed the lesser of (1) the Maximum Revolver Amount and (2) the Borrowing Base on such Funding Date.

(ii) Unless Agent receives notice from a Lender prior to 12:00 noon (New York time) on the date of a Borrowing, that such Lender will not make available as and when required hereunder to Agent for the account of Borrower the amount of that Lender’s Pro Rata Share of the Borrowing, Agent may assume that each Lender has made or will make such amount available to Agent in immediately available funds on the Funding Date and Agent may (but shall not be so required), in reliance upon such assumption, make available to Borrower on such date a corresponding amount. If any Lender shall not have made its full amount available to Agent in immediately available funds and if Agent in such circumstances has made available to Borrower such amount, that Lender shall on the Business Day following such Funding Date make such amount available to Agent, together with interest at the Defaulting Lender Rate for each day during such period. A notice submitted by Agent to any Lender with respect to amounts owing under this Section 2.3(c)(ii) shall be conclusive, absent manifest error. If such amount is so made available, such payment to Agent shall constitute such Lender’s Advance on the date of Borrowing for all purposes of this Agreement. If such amount is not made available to Agent on the Business Day following the Funding Date, Agent will notify Borrower of such failure to fund and, within 3 Business Days after demand by Agent, Borrower shall pay such amount to Agent for Agent’s account, together with interest thereon for each day elapsed since the date of such Borrowing, at a rate per annum equal to the interest rate applicable at the time to the Advances composing such Borrowing.

(d) Protective Advances and Optional Overadvances.

(i) Any contrary provision of this Agreement or any other Loan Document notwithstanding, but subject to Section 2.3(d)(iv), Agent hereby is authorized by Borrower and Lenders, from time to time in Agent’s sole discretion, (A) after the

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occurrence and during the continuance of a Default or an Event of Default, or (B) at any time that any of the other applicable conditions precedent set forth in Section 3 are not satisfied, to make Advances to, or for the benefit of, Borrower on behalf of the Lenders that Agent, in its Permitted Discretion deems necessary or desirable (1) to preserve or protect the ABL Priority Collateral, or any portion thereof, or (2) to enhance the likelihood of repayment of the Obligations (other than the Bank Product Obligations) (any of the Advances described in this Section 2.3(d)(i) shall be referred to as “Protective Advances”).

(ii) Any contrary provision of this Agreement or any other Loan Document notwithstanding, but subject to Section 2.3(d)(iv), the Lenders hereby authorize Agent or Swing Lender, as applicable, and either Agent or Swing Lender, as applicable, may, but is not obligated to, knowingly and intentionally, continue to make Advances (including Swing Loans) to Borrower notwithstanding that an Overadvance exists or would be created thereby, so long as (A) after giving effect to such Advances, the outstanding Revolver Usage does not exceed the Borrowing Base by more than 10% of the lesser of (1) the Maximum Revolver Amount and (2) the Borrowing Base, and (B) after giving effect to such Advances, the outstanding Revolver Usage (except for and excluding amounts charged to the Loan Account for interest, fees, or Lender Group Expenses) does not exceed the Maximum Revolver Amount. In the event Agent obtains actual knowledge that the Revolver Usage exceeds the amounts permitted by the immediately foregoing provisions, regardless of the amount of, or reason for, such excess, Agent shall notify Lenders as soon as practicable (and prior to making any (or any additional) intentional Overadvances (except for and excluding amounts charged to the Loan Account for interest, fees, or Lender Group Expenses) unless Agent determines that prior notice would result in imminent harm to the Collateral or its value, in which case Agent may make such Overadvances and provide notice as promptly as practicable thereafter), and Lenders with Revolver Commitments thereupon shall, together with Agent, jointly determine the terms of arrangements that shall be implemented with Borrower intended to reduce, within a reasonable time, the outstanding principal amount of the Advances to Borrower to an amount permitted by the preceding sentence. In such circumstances, if any Lender with a Revolver Commitment objects to the proposed terms of reduction or repayment of any Overadvance, the terms of reduction or repayment thereof shall be implemented according to the determination of the Required Lenders. In any event: (x) if any unintentional Overadvance remains outstanding for more than 30 days, unless otherwise agreed to by the Required Lenders, Borrower shall immediately repay Advances in an amount sufficient to eliminate all such unintentional Overadvances, and (y) after the date all such Overadvances have been eliminated, there must be at least five consecutive days before intentional Overadvances are made. The foregoing provisions are meant for the benefit of Lenders and Agent and are not meant for the benefit of Borrower, which shall continue to be bound by the provisions of Section 2.5. Each Lender with a Revolver Commitment shall be obligated to settle with Agent as provided in Section 2.3(e) (or Section 2.3(g), as applicable) for the amount of such Lender’s Pro Rata Share of any unintentional Overadvances by Agent reported to such Lender, any intentional Overadvances made as permitted under this Section 2.3(d)(ii), and any Overadvances resulting from the charging to the Loan Account of interest, fees, or Lender Group Expenses.

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(iii) Each Protective Advance and each Overadvance shall be deemed to be an Advance hereunder, except that no Protective Advance or Overadvance shall be eligible to be a LIBOR Rate Loan and, prior to Settlement thereof, all payments on the Protective Advances shall be payable to Agent solely for its own account. The Protective Advances and Overadvances shall be repayable on demand, secured by Agent’s Liens, constitute Obligations hereunder, and bear interest at the rate applicable from time to time to Advances that are Base Rate Loans. The ability of Agent to make Protective Advances is separate and distinct from its ability to make Overadvances and its ability to make Overadvances is separate and distinct from its ability to make Protective Advances. For the avoidance of doubt, the limitations on Agent’s ability to make Protective Advances do not apply to Overadvances and the limitations on Agent’s ability to make Overadvances do not apply to Protective Advances. The provisions of this Section 2.3(d) are for the exclusive benefit of Agent, Swing Lender, and Lenders and are not intended to benefit Borrower in any way.

(iv) Notwithstanding anything contained in this Agreement or any other Loan Document to the contrary: (A) no Overadvance or Protective Advance may be made by Agent if such Advance would cause the aggregate principal amount of Overadvances and Protective Advances outstanding to exceed an amount equal to 10% of the lesser of (1) the Maximum Revolver Amount and (2) the Borrowing Base and (B) after giving effect to all Overadvances and Protective Advances, the aggregate Revolver Usage (except for and excluding amounts charged to the Loan Account for interest, fees, or Lender Group Expenses) shall not exceed the Maximum Revolver Amount; provided that, to the extent any Protective Advance causes the aggregate Revolver Usage (except for and excluding amounts charged to the Loan Account for interest, fees, or Lender Group Expenses) to exceed the Maximum Revolver Amount, such portion of such Protective Advance shall be for Agent’s sole and separate account and not for the account of any Lender and shall be entitled to priority in repayment in accordance with Section 2.4(b).

(e) Settlement. It is agreed that each Lender’s funded portion of the Advances is intended by Lenders to equal, at all times, such Lender’s Pro Rata Share of the outstanding Advances. Such agreement notwithstanding, Agent, Swing Lender, and the other Lenders agree (which agreement shall not be for the benefit of Borrower) that in order to facilitate the administration of this Agreement and the other Loan Documents, settlement among Lenders as to the Revolver Loans, the Swing Loans, and the Protective Advances shall take place on a periodic basis in accordance with the following provisions:

(i) Agent shall request settlement (“Settlement”) with the Lenders on a weekly basis, or on a more frequent basis if so determined by Agent (1) on behalf of Swing Lender, with respect to the outstanding Swing Loans, (2) for itself, with respect to the outstanding Protective Advances or Overadvances, and (3) with respect to any Loan Party’s Collections or payments received, as to each by notifying the Lenders by telecopy, telephone, or other similar form of transmission, of such requested Settlement, no later than 4:00 p.m. (New York time) on the Business Day immediately prior to the date of such requested Settlement (the date of such requested Settlement being the “Settlement Date”). Such notice of a Settlement Date shall include a summary statement

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of the amount of outstanding Revolver Loans, Swing Loans, Overadvances, and Protective Advances for the period since the prior Settlement Date. Subject to the terms and conditions contained herein (including Section 2.3(g)): (y) if the amount of the Advances (including Revolver Loans, Swing Loans, Overadvances, and Protective Advances) made by a Lender that is not a Defaulting Lender exceeds such Lender’s Pro Rata Share of the Advances (including Revolver Loans, Swing Loans, Overadvances, and Protective Advances) as of a Settlement Date, then Agent shall, by no later than 3:00 p.m. (New York time) on the Settlement Date, transfer in immediately available funds to a Deposit Account of such Lender (as such Lender may designate), an amount such that each such Lender shall, upon receipt of such amount, have as of the Settlement Date, its Pro Rata Share of the Advances (including Revolver Loans, Swing Loans, Overadvances, and Protective Advances), and (z) if the amount of the Advances (including Revolver Loans, Swing Loans, Overadvances, and Protective Advances) made by a Lender is less than such Lender’s Pro Rata Share of the Advances (including Revolver Loans, Swing Loans, Overadvances, and Protective Advances) as of a Settlement Date, such Lender shall no later than 3:00 p.m. (New York time) on the Settlement Date transfer in immediately available funds to Agent’s Account, an amount such that each such Lender shall, upon transfer of such amount, have as of the Settlement Date, its Pro Rata Share of the Advances (including Revolver Loans, Swing Loans, Overadvances, and Protective Advances). Such amounts made available to Agent under clause (z) of the immediately preceding sentence shall be applied against the amounts of the applicable Swing Loans, Overadvances, or Protective Advances and, together with the portion of such Swing Loans, Overadvances, or Protective Advances representing Swing Lender’s Pro Rata Share thereof, shall constitute Advances of such Lenders. If any such amount is not made available to Agent by any Lender on the Settlement Date applicable thereto to the extent required by the terms hereof, Agent shall be entitled to recover for its account such amount on demand from such Lender together with interest thereon at the Defaulting Lender Rate.

(ii) In determining whether a Lender’s actual balance of the Revolver Loans, Swing Loans, Overadvances, and Protective Advances is less than, equal to, or greater than such Lender’s Pro Rata Share of the Revolver Loans, Swing Loans, Overadvances, and Protective Advances as of a Settlement Date, Agent shall, as part of the relevant Settlement, apply to such balance the portion of payments actually received in good funds by Agent with respect to principal, interest, fees payable by Borrower and allocable to Lenders hereunder, and proceeds of Collateral.

(iii) Between Settlement Dates, Agent, to the extent Protective Advances, Overadvances, or Swing Loans are outstanding, may pay over to Agent or Swing Lender, as applicable, any Collections or payments received by Agent, that in accordance with the terms of this Agreement would be applied to the reduction of the Advances, for application to the Protective Advances, Overadvances, or Swing Loans. Between Settlement Dates, Agent, to the extent no Protective Advances, Overadvances, or Swing Loans are outstanding, may pay over to Swing Lender any Collections or payments received by Agent, that in accordance with the terms of this Agreement would be applied to the reduction of the Advances, for application to Swing Lender’s Pro Rata Share of the Advances. If, as of any Settlement Date, Collections or payments of Parent

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or its Subsidiaries received since the then immediately preceding Settlement Date have been applied to Swing Lender’s Pro Rata Share of the Advances (other than to Swing Loans), as provided for in the previous sentence, Swing Lender shall pay to Agent for the accounts of the Lenders, and Agent shall pay to the Lenders (other than a Defaulting Lender if Agent has implemented the provisions of Section 2.3(g)), to be applied to the outstanding Advances of such Lenders, an amount such that each such Lender shall, upon receipt of such amount, have, as of such Settlement Date, its Pro Rata Share of the Advances. During the period between Settlement Dates, Swing Lender with respect to Swing Loans, Agent with respect to Protective Advances and Overadvances, and each Lender with respect to the Revolver Loans, shall be entitled to interest at the applicable rate or rates payable under this Agreement on the daily amount of funds employed by Swing Lender, Agent, or the Lenders, as applicable.

(iv) Anything in this Section 2.3(e) to the contrary notwithstanding, in the event that a Lender is a Defaulting Lender, Agent shall not be obligated to remit settlement amounts to the Defaulting Lender and, instead, may implement the provisions set forth in Section 2.3(g).

(f) Reserved.

(g) Defaulting Lenders. Agent shall not be obligated to transfer to a Defaulting Lender any payments made by Borrower to Agent for the Defaulting Lender’s benefit or any Collections or proceeds of Collateral that would otherwise be remitted hereunder to the Defaulting Lender, and, in the absence of such transfer to the Defaulting Lender, Agent shall transfer any such payments (A) first, to Swing Lender to the extent of any Swing Loans that were made by Swing Lender and that were required to be, but were not, paid by the Defaulting Lender or any other Person, (B) second, to the Issuing Lender, to the extent of the portion of a Letter of Credit Disbursement that was required to be, but was not, paid by the Defaulting Lender or any other Person, (C) third, to each non-Defaulting Lender ratably in accordance with their Revolver Commitments (but, in each case, only to the extent that such Defaulting Lender’s portion of an Advance (or other funding obligation) was funded by such other non-Defaulting Lender), (D) to a suspense account maintained by Agent, the proceeds of which shall be retained by Agent and may be made available to be re-advanced to or for the benefit of Borrower as if such Defaulting Lender had made its portion of Advances (or other funding obligations) hereunder, and (E) from and after the date on which the Revolver Commitment is cancelled or terminated and all other Obligations have been paid in full, to such Defaulting Lender in accordance with tier (N) of Section 2.4(b)(ii). Subject to the foregoing, Agent may hold and, in its discretion, re-lend to Borrower for the account of such Defaulting Lender the amount of all such payments received and retained by Agent for the account of such Defaulting Lender. Solely for the purposes of voting or consenting to matters with respect to the Loan Documents (including the calculation of Pro Rata Share in connection therewith) and for the purpose of calculating the fee payable under Section 2.10(b), such Defaulting Lender shall be deemed not to be a “Lender” and such Lender’s Revolver Commitment shall be deemed to be zero; provided, however, that the foregoing shall not apply to any of the matters governed by Section 14.1(a)(i) through (iii). The provisions of this Section 2.3(g) shall remain effective with respect to such Defaulting Lender until the earlier of (y) the date on which all of the non-Defaulting Lenders, Agent, Issuing Lender, and Borrower shall have waived, in writing, the application of this Section 2.3(g) to such Defaulting Lender, or

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(z) the date on which such Defaulting Lender makes payment of all amounts that it was obligated to fund hereunder, pays to Agent all amounts owing by Defaulting Lender in respect of the amounts that it was obligated to fund hereunder, and, if requested by Agent, provides adequate assurance of its ability to perform its future obligations hereunder. The operation of this Section 2.3(g) shall not be construed to increase or otherwise affect the Revolver Commitment of any Lender, to relieve or excuse the performance by such Defaulting Lender or any other Lender of its duties and obligations hereunder, or to relieve or excuse the performance by Borrower of its duties and obligations hereunder to Agent, Issuing Lender, or to the Lenders other than such Defaulting Lender. Any failure by a Defaulting Lender to fund amounts that it was obligated to fund hereunder shall constitute a material breach by such Defaulting Lender of this Agreement and shall entitle Borrower, in addition to any other remedies which it may be entitled, to replace such Defaulting Lender in accordance with Section 14.2. In the event of a direct conflict between the priority provisions of this Section 2.3(g) and any other provision contained in this Agreement or any other Loan Document, it is the intention of the parties hereto that such provisions be read together and construed, to the fullest extent possible, to be in concert with each other. In the event of any actual, irreconcilable conflict that cannot be resolved as aforesaid, the terms and provisions of this Section 2.3(g) shall control and govern.

(h) Independent Obligations. All Revolver Loans shall be made by the Lenders contemporaneously and in accordance with their Pro Rata Shares. It is understood that (i) no Lender shall be responsible for any failure by any other Lender to perform its obligation to make any Advance (or other extension of credit) hereunder, nor shall any Revolver Commitment of any Lender be increased or decreased as a result of any failure by any other Lender to perform its obligations hereunder, and (ii) no failure by any Lender to perform its obligations hereunder shall excuse any other Lender from its obligations hereunder.

2.4 Payments; Reductions of Revolver Commitments; Prepayments.

(a) Payments by Borrower.

(i) Except as otherwise expressly provided herein, all payments by Borrower shall be made to Agent’s Account for the account of the Lender Group and shall be made in immediately available funds, no later than 3:00 p.m. (New York time) on the date specified herein. Any payment received by Agent later than 3:00 p.m. (New York time) shall be deemed to have been received on the following Business Day and any applicable interest or fee shall continue to accrue until such following Business Day.

(ii) Unless Agent receives notice from Borrower prior to the date on which any payment is due to Lenders that Borrower will not make such payment in full as and when required, Agent may assume that Borrower has made (or will make) such payment in full to Agent on such date in immediately available funds and Agent may (but shall not be so required), in reliance upon such assumption, distribute to each Lender on such due date an amount equal to the amount then due such Lender. If and to the extent Borrower does not make such payment in full to Agent on the date when due, each Lender severally shall repay to Agent on demand such amount distributed to such Lender, together with interest thereon at the Defaulting Lender Rate for each day from the date such amount is distributed to such Lender until the date repaid.

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(b) Apportionment and Application.

(i) So long as no Application Event has occurred and is continuing and except as otherwise provided herein with respect to Defaulting Lenders, all principal and interest payments received by Agent shall be apportioned ratably among Lenders (according to the unpaid principal balance of the Obligations to which such payments relate held by each Lender) and all payments of fees and expenses received by Agent (other than fees or expenses that are for Agent’s separate account or for the separate account of the Issuing Lender) shall be apportioned ratably among the Lenders having a Pro Rata Share of the type of Revolver Commitment or Obligation to which a particular fee or expense relates. All payments to be made hereunder by Borrower shall be remitted to Agent and all (subject to Section 2.4(b)(iv) and Section 2.4(e)) such payments, and all proceeds of Collateral received by Agent, shall be applied, so long as no Application Event has occurred and is continuing, to reduce the balance of the Advances outstanding and, thereafter, to Borrower (to be wired to the Designated Account) or such other Person entitled thereto under applicable law.

(ii) At any time that an Application Event has occurred and is continuing and except as otherwise provided herein with respect to Defaulting Lenders, all payments remitted to Agent and all proceeds of Collateral received by Agent shall be applied as follows:

(A) first, to pay any Lender Group Expenses (including cost or expense reimbursements) or indemnities then due to Agent for its own account under the Loan Documents, until paid in full,

(B) second, to pay any fees or premiums then due to Agent for its own account under the Loan Documents until paid in full,

(C) third, to pay interest due in respect of all Protective Advances until paid in full,

(D) fourth, to pay the principal of all Protective Advances until paid in full,

(E) fifth, ratably, to pay any Lender Group Expenses (including cost or expense reimbursements) or indemnities then due to any of the Lenders under the Loan Documents, until paid in full,

(F) sixth, ratably, to pay any fees or premiums then due to any of the Lenders under the Loan Documents until paid in full,

(G) seventh, to pay interest accrued in respect of the Swing Loans until paid in full,

(H) eighth, to pay the principal of all Swing Loans until paid in full,

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(I) ninth, ratably, to pay interest accrued in respect of the Revolver Loans,

(J) tenth, ratably (i) to pay the principal of all Revolver Loans until paid in full, (ii) to Agent, to be held by Agent, for the benefit of Issuing Lender (and for the ratable benefit of each of the Lenders that have an obligation to pay to Agent, for the account of the Issuing Lender, a share of each Letter of Credit Disbursement), as cash collateral in an amount up to 105% of the Letter of Credit Usage (to the extent permitted by applicable law, such cash collateral shall be applied to the reimbursement of any Letter of Credit Disbursement as and when such disbursement occurs and, if a Letter of Credit expires undrawn, the cash collateral held by Agent in respect of such Letter of Credit shall, to the extent permitted by applicable law, be reapplied pursuant to this Section 2.4(b)(ii), beginning with tier (A) hereof), and (iii) ratably, to the Hedge Providers based upon amounts certified to Agent to be due and payable to such Hedge Provider on account of Noticed Bank Product Obligations constituting Hedge Obligations,

(K) eleventh, ratably to the Bank Product Providers based upon amounts certified to Agent to be due and payable to such Bank Product Provider on account of Noticed Bank Product Obligations (other than Hedge Obligations provided for in clause (J) above),

(L) twelfth, ratably to the Bank Product Providers on account of any other Bank Product Obligations that are due and payable,

(M) thirteenth, to pay any other Obligations that are due and payable other than Obligations owed to Defaulting Lenders,

(N) fourteenth, ratably to pay any Obligations that are due and payable owed to Defaulting Lenders; and

(O) fifteenth, to Borrower (to be wired to the Designated Account) or such other Person entitled thereto under applicable law.

(iii) Agent promptly shall distribute to each Lender, pursuant to the applicable wire instructions received from each Lender in writing, such funds as it may be entitled to receive, subject to a Settlement delay as provided in Section 2.3(e).

(iv) In each instance, so long as no Application Event has occurred and is continuing, Section 2.4(b)(i) shall not apply to any payment made by Borrower to Agent and specified by Borrower to be for the payment of specific Obligations then due and payable (or prepayable) under any provision of this Agreement or any other Loan Document.

(v) For purposes of Section 2.4(b), “paid in full” of a type of Obligation means payment in cash or immediately available funds of all amounts owing on account of such type of Obligation, including interest accrued after the commencement of any Insolvency Proceeding, default interest, interest on interest, and expense reimbursements, irrespective of whether any of the foregoing would be or is allowed or disallowed in whole or in part in any Insolvency Proceeding.

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(vi) In the event of a direct conflict between the priority provisions of this Section 2.4 and any other provision contained in this Agreement or any other Loan Document, it is the intention of the parties hereto that such provisions be read together and construed, to the fullest extent possible, to be in concert with each other. In the event of any actual, irreconcilable conflict that cannot be resolved as aforesaid, if the conflict relates to the provisions of Section 2.3(g) and this Section 2.4, then the provisions of Section 2.3(g) shall control and govern, and if otherwise, then the terms and provisions of this Section 2.4 shall control and govern.

(c) Reduction of Revolver Commitments. The Revolver Commitments shall terminate on the Maturity Date. Borrower may reduce the Revolver Commitments, without premium or penalty, to an amount (which may be zero) not less than the sum of (A) the Revolver Usage as of such date, plus (B) the principal amount of all Advances not yet made as to which a request has been given by Borrower under Section 2.3(a), plus (C) the amount of all Letters of Credit not yet issued as to which a request has been given by Borrower pursuant to Section 2.11(a). Each such reduction shall be in an amount which is not less than $5,000,000 (unless the Revolver Commitments are being reduced to zero and the amount of the Revolver Commitments in effect immediately prior to such reduction are less than $5,000,000), shall be made by providing not less than 5 Business Days prior written notice to Agent and shall be irrevocable. Once reduced, the Revolver Commitments may not be increased except in accordance with Section 2.14. Each such reduction of the Revolver Commitments shall reduce the Revolver Commitments of each Lender proportionately in accordance with its ratable share thereof.

(d) Optional Prepayments. Borrower may prepay the principal of any Advance at any time in whole or in part, without premium or penalty.

(e) Mandatory Prepayments.

(i) Borrowing Base. If, at any time, the Revolver Usage on such date exceeds (A) the Borrowing Base (such excess being referred to as the “Borrowing Base Excess”) or (B) the Maximum Revolver Amount (such excess being referred to as the “Commitment Excess”), then Borrower shall, subject to Section 2.5, promptly, but in any event, within 3 Business Days prepay the Obligations in accordance with Section 2.4(f) in an aggregate amount equal to the greater of the Borrowing Base Excess and the Commitment Excess.

(ii) Dispositions.

(A) ABL Priority Collateral. Within 3 Business Days after the date of receipt by any Loan Party of the Net Cash Proceeds of any voluntary or involuntary sale or disposition by a Loan Party of any ABL Priority Collateral (including casualty losses or condemnations) in excess of $500,000 individually, or $1,000,000 in the aggregate in any fiscal year, other than sales or dispositions permitted under clauses (b), (c), (f), (j), (l), (m) or (q) of the definition of

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Permitted Dispositions, Borrower shall prepay the outstanding principal amount of the Obligations in accordance with Section 2.4(f) in an amount equal to 100% of such Net Cash Proceeds (including condemnation awards and payments in lieu thereof) received by such Person in connection with such sale or disposition, provided that during any Trigger Period, concurrently with the receipt of any Net Cash Proceeds in connection with this clause (A), 100% of such proceeds shall be immediately deposited into Agent’s Account and used to prepay Advances and/or provide for Letter of Credit Collateralization in accordance with Section 2.4(f).

(B) Secured Notes Priority Collateral. Within 10 Business Days after the date of receipt by any Loan Party or, if the Secured Notes or any Permitted Additional Pari Passu Obligations (or any Refinancing Indebtedness in respect of the foregoing) are outstanding, 10 Business Days after the expiration of all prepayment and reinvestment periods under the Secured Notes Documents or documents governing any Permitted Additional Pari Passu Obligations (or any Refinancing Indebtedness in respect of the foregoing) with respect to the receipt by any Loan Party, in each case, of the Net Cash Proceeds of any voluntary or involuntary sale or disposition by any Loan Party of any Collateral (other than ABL Priority Collateral) (including casualty losses or condemnations), except sales or dispositions permitted under Sections 6.3 or 6.11, or under clauses (b), (c), (f), (j), (l), (m) or (q) of the definition of Permitted Dispositions and unless the Secured Notes or any Permitted Additional Pari Passu Obligations (or any Refinancing Indebtedness in respect of the foregoing) are outstanding and such Net Cash Proceeds are prepaid or reinvested in accordance with the terms of the Secured Notes Documents or such Permitted Additional Pari Passu Obligations or Refinancing Indebtedness, and to the extent the aggregate amount of Net Cash Proceeds received or unapplied by the Loan Parties exceeds $2,500,000 in any fiscal year, then Borrower shall (I) prepay the outstanding principal amount of the Obligations in accordance with Section 2.4(f) in an amount equal to 100% of such Net Cash Proceeds (including condemnation awards and payments in lieu thereof) received by such Person in connection with such sales or dispositions or (II) if the Secured Notes or any Permitted Additional Pari Passu Obligations (or any Refinancing Indebtedness in respect of the foregoing) are not outstanding, so long as no Event of Default under Section 8.1 has occurred and is continuing on the date such Net Cash Proceeds are received, deliver to Agent, written notice that Parent or another Loan Party intends to reinvest (or actually has reinvested) such Net Cash Proceeds in assets useful in its business. If the Secured Notes or any Permitted Additional Pari Passu Obligations (or any Refinancing Indebtedness in respect of the foregoing) are not outstanding, to the extent that such Net Cash Proceeds have not theretofore been applied to prepay the Obligations or reinvested within 12 months after the date of receipt thereof, or to the extent that Parent or another Loan Party has entered into a binding commitment to reinvest such Net Cash Proceeds, the date that is the later of (x) 12 months after the receipt thereof and (y) 90 days after the date of entry into such binding commitment, Borrower shall make an additional prepayment of the outstanding principal amount of the Obligations in an amount equal to such unapplied Net Cash Proceeds.

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Nothing contained in this Section 2.4(e)(ii) shall permit Parent or any of its Subsidiaries to sell or otherwise dispose of any assets other than in accordance with Section 6.4.

(f) Application of Payments. Each prepayment pursuant to Section 2.4(e)(i) or 2.4(e)(ii) shall, (A) so long as no Application Event shall have occurred and be continuing, be applied, first, to the outstanding principal amount of the Advances (without a corresponding permanent reduction in the Maximum Revolver Amount) until paid in full (applied first ratably to Protective Advances, second ratably to Swing Loans and third ratably to Revolver Loans), and second, to cash collateralize the Letters of Credit in an amount equal to 105% of the then extant Letter of Credit Usage (without a corresponding permanent reduction in the Maximum Revolver Amount), and (B) if an Application Event shall have occurred and be continuing, be applied in the manner set forth in Section 2.4(b)(ii).

2.5 Overadvances. If, at any time or for any reason, the amount of Obligations owed by Borrower to the Lender Group pursuant to Section 2.1 or Section 2.11 is greater than any of the limitations set forth in Section 2.1, Section 2.4(e)(i) or Section 2.11, as applicable (an “Overadvance”), Borrower shall, subject to Section 2.3(d)(ii), promptly, but in any event, within 3 Business Days of the initial occurrence of an Overadvance pay to Agent, in cash, the amount of such excess, which amount shall be used by Agent to reduce the Obligations in accordance with the priorities set forth in Section 2.4(b); provided, however, that in the case of an Overadvance that is caused solely as a result of (a) the charging by Agent of Lender Group Expenses to the Loan Account or (b) the implementation or increase of reserves by Agent subsequent to the Closing Date, Borrower shall have 3 Business Days from the date of the initial occurrence of such Overadvance to pay to Agent, in cash, the amount of such excess (which period of 3 Business Days shall in no event be duplicative of the 3 Business Days period referenced in Section 8.1(a)). Borrower promises to pay the Obligations (including principal, interest, fees, costs, and expenses) in full on the Maturity Date or, if earlier, on the date on which the Obligations (other than the Bank Product Obligations) become due and payable pursuant to the terms of this Agreement.

2.6 Interest Rates and Letter of Credit Fee: Rates, Payments, and Calculations.

(a) Interest Rates. Except as provided in Section 2.6(c), all Obligations (except for undrawn Letters of Credit) that have been charged to the Loan Account pursuant to the terms hereof shall bear interest on the Daily Balance thereof as follows:

(i) if the relevant Obligation is a LIBOR Rate Loan, at a per annum rate equal to the LIBOR Rate plus the Applicable Margin for LIBOR Rate Loans, and

(ii) otherwise, at a per annum rate equal to the Base Rate plus the Applicable Margin for Base Rate Loans.

(b) Letter of Credit Fee. Borrower shall pay Agent (for the ratable benefit of the Lenders with a Revolver Commitment), a Letter of Credit fee (in addition to the charges, commissions, fees, and costs set forth in Section 2.11(f)) which shall accrue at a per annum rate equal to the Applicable Margin for LIBOR Rate Loans times the Daily Balance of the undrawn amount of all outstanding Letters of Credit.

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(c) Default Rate. (i) Immediately upon the occurrence and during the continuation of an Event of Default under Sections 8.1, 8.4 or 8.5, or (ii) at the election of the Required Lenders, upon the occurrence and during the continuation of any other Event of Default,

(A) all Obligations (except for undrawn Letters of Credit) that have been charged to the Loan Account pursuant to the terms hereof shall bear interest on the Daily Balance thereof at a per annum rate equal to 2% above the per annum rate otherwise applicable thereunder, and

(B) the Letter of Credit fee provided for in Section 2.6(b) shall be increased to 2% above the per annum rate otherwise applicable hereunder.

(d) Payment. Except to the extent provided to the contrary in Section 2.10 or Section 2.12(a), all interest, all Letter of Credit fees, and all other fees payable hereunder or under any of the other Loan Documents shall be due and payable, in arrears, on the first day of each month at any time that Obligations or Revolver Commitments are outstanding. All costs and expenses payable hereunder or under any of the other Loan Documents, and all Lender Group Expenses shall be due and payable on demand of Agent. Borrower hereby authorizes Agent, from time to time without prior notice to Borrower, to charge all interest, Letter of Credit fees, and all other fees payable hereunder or under any of the other Loan Documents (in each case, as and when due and payable), all costs and expenses payable hereunder or under any of the other Loan Documents (in each case, as and when accrued or incurred), and all Lender Group Expenses (as and when accrued or incurred), all charges, commissions, fees, and costs provided for in Section 2.11(f) (as and when accrued or incurred), all fees and costs provided for in Section 2.10 (as and when accrued or incurred), and all other payment obligations as and when due and payable under any Loan Document or any Bank Product Agreement (including any amounts due and payable to the Bank Product Providers in respect of Bank Products) to the Loan Account, which amounts thereafter shall constitute Advances hereunder and, initially, shall accrue interest at the rate then applicable to Advances that are Base Rate Loans. Any interest, fees, costs, expenses, Lender Group Expenses, or other amounts payable hereunder or under any other Loan Document or under any Bank Product Agreement that are charged to the Loan Account shall thereupon constitute Advances hereunder and shall initially accrue interest at the rate then applicable to Advances that are Base Rate Loans (unless and until converted into LIBOR Rate Loans in accordance with the terms of this Agreement).

(e) Computation. All interest and fees chargeable under the Loan Documents shall be computed on the basis of a 360 day year, in each case, for the actual number of days elapsed in the period during which the interest or fees accrue; provided that Base Rate Loans bearing interest based on the “prime rate” shall be calculated on the basis of a 365 day year (or a 366 day year, in the case of a leap year). In the event the Base Rate is changed from time to time hereafter, the rates of interest hereunder based upon the Base Rate automatically and immediately shall be increased or decreased by an amount equal to such change in the Base Rate.

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(f) Intent to Limit Charges to Maximum Lawful Rate. In no event shall the interest rate or rates payable under this Agreement, plus any other amounts paid in connection herewith, exceed the highest rate permissible under any law that a court of competent jurisdiction shall, in a final determination, deem applicable. Borrower and the Lender Group, in executing and delivering this Agreement, intend legally to agree upon the rate or rates of interest and manner of payment stated within it; provided, however, that, anything contained herein to the contrary notwithstanding, if such rate or rates of interest or manner of payment exceeds the maximum allowable under applicable law, then, ipso facto, as of the date of this Agreement, Borrower is and shall be liable only for the payment of such maximum amount as is allowed by law, and payment received from Borrower in excess of such legal maximum, whenever received, shall be applied to reduce the principal balance of the Obligations to the extent of such excess.

2.7 Crediting Payments. The receipt of any payment item by Agent shall not be considered a payment on account unless such payment item is a wire transfer of immediately available federal funds made to Agent’s Account or unless and until such payment item is honored when presented for payment. Should any payment item not be honored when presented for payment, then Borrower shall be deemed not to have made such payment and interest shall be calculated accordingly. Anything to the contrary contained herein notwithstanding, any payment item shall be deemed received by Agent only if it is received into Agent’s Account on a Business Day on or before 3:00 p.m. (New York time). If any payment item is received into Agent’s Account on a non-Business Day or after 3:00 p.m. (New York time) on a Business Day, it shall be deemed to have been received by Agent as of the opening of business on the immediately following Business Day.

2.8 Designated Account. Agent is authorized to make the Advances, and Issuing Lender is authorized to issue the Letters of Credit, under this Agreement based upon telephonic or other instructions received from anyone purporting to be an Authorized Person or, without instructions, if pursuant to Section 2.6(d). Borrower agrees to establish and maintain the Designated Account with the Designated Account Bank for the purpose of receiving the proceeds of the Advances requested by Borrower and made by Agent or the Lenders hereunder. Unless otherwise agreed by Agent and Borrower, any Advance or Swing Loan requested by Borrower and made by Agent or the Lenders hereunder shall be made to the Designated Account.

2.9 Maintenance of Loan Account; Statements of Obligations. Agent shall maintain an account on its books in the name of Borrower (the “Loan Account”) on which Borrower will be charged with all Advances (including Revolver Loans, Protective Advances and Swing Loans) made by Agent, Swing Lender, or the Lenders to Borrower or for Borrower’s account, the Letters of Credit issued or arranged by Issuing Lender for Borrower’s account, and with all other payment Obligations hereunder or under the other Loan Documents, including, accrued interest, fees and expenses, and Lender Group Expenses. In accordance with Section 2.7, the Loan Account will be credited with all payments received by Agent from Borrower or for Borrower’s account. Agent shall render monthly statements regarding the Loan Account to Borrower, including principal, interest, fees, and including an itemization of all charges and expenses constituting Lender Group Expenses owing, and such statements, absent manifest error, shall be conclusively presumed to be correct and accurate and constitute an account stated between Borrower and the Lender Group unless, within 30 days after receipt thereof by Borrower, Borrower shall deliver to Agent written objection thereto describing the error or errors contained in any such statements.

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2.10 Fees. Borrower shall pay to Agent,

(a) for the account of Agent, as and when due and payable under the terms of the Fee Letter, the fees set forth in the Fee Letter;

(b) for the ratable account of the Lenders, on the first day of each month from and after the Closing Date up to the first day of the month prior to the Payoff Date and on the Payoff Date, (i) if the average Daily Balance of the Revolver Usage during the immediately preceding three-month period (or portion thereof) exceeds 50% of the Maximum Revolver Amount, an unused line fee in an amount equal to 0.375% per annum or (ii) if the average Daily Balance of the Revolver Usage during the immediately preceding three-month period (or portion thereof) is less than or equal to 50% of the Maximum Revolver Amount, an unused line fee in an amount equal to 0.50% per annum, in either case times the result of (A) the aggregate amount of the Maximum Revolver Amount, less (B) the average Daily Balance of the Revolver Usage during the immediately preceding three-month period (or portion thereof); and

(c) audit, appraisal, and valuation fees and charges, as and when incurred or chargeable, as follows (i) a fee of $1,000 per day, per auditor, plus out-of-pocket expenses for each financial audit of Borrower performed by personnel employed by Agent, (ii) a fee of $1,000 per day, per applicable individual, plus out of pocket expenses in connection with any modifications to the electronic collateral reporting system established for Parent and the other Loan Parties, and (iii) the actual charges paid or incurred by Agent if it elects to employ the services of one or more third Persons to perform field audits of Parent or the other Loan Parties or to appraise the Collateral, or any portion thereof; provided, however, that so long as no Event of Default shall have occurred and be continuing, Borrower shall not be obligated to reimburse Agent for more than 2 audits and 1 appraisal for Collateral during any calendar year; provided, further that (A) the total number of audits shall be increased by 1 in any 12 month period during a Trigger Period and (B) upon the occurrence and during the continuation of an Event of Default, there shall be no limit on the number of audits or appraisals which may be conducted by Agent (or its designee) upon reasonable prior notice, each at the expense of Borrower.

2.11 Letters of Credit.

(a) Subject to the terms and conditions of this Agreement, upon the request of Borrower made in accordance herewith, the Issuing Lender agrees to issue, or to cause an Underlying Issuer (including, as Issuing Lender’s agent) to issue, a requested Letter of Credit. If Issuing Lender, at its option, elects to cause an Underlying Issuer to issue a requested Letter of Credit, then Issuing Lender agrees that it will enter into arrangements relative to the reimbursement of such Underlying Issuer (which may include, among, other means, by becoming an applicant with respect to such Letter of Credit or entering into undertakings which provide for reimbursements of such Underlying Issuer with respect to such Letter of Credit; each such obligation or undertaking, irrespective of whether in writing, a “Reimbursement Undertaking”) with respect to Letters of Credit issued by such Underlying Issuer. By submitting a request to Issuing Lender for the issuance of a Letter of Credit, Borrower shall be deemed to

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have requested that Issuing Lender issue or that an Underlying Issuer issue the requested Letter of Credit and to have requested Issuing Lender to issue a Reimbursement Undertaking with respect to such requested Letter of Credit if it is to be issued by an Underlying Issuer (it being expressly acknowledged and agreed by Borrower that Borrower is and shall be deemed to be an applicant (within the meaning of Section 5-102(a)(2) of the Code) with respect to each Underlying Letter of Credit). Each request for the issuance of a Letter of Credit, or the amendment, renewal, or extension of any outstanding Letter of Credit, shall be made in writing by an Authorized Person and delivered to the Issuing Lender via hand delivery, facsimile, or other electronic method of transmission reasonably in advance of the requested date of issuance, amendment, renewal, or extension. Each such request shall be in form and substance reasonably satisfactory to the Issuing Lender and shall specify (i) the amount of such Letter of Credit, (ii) the date of issuance, amendment, renewal, or extension of such Letter of Credit, (iii) the proposed expiration date of such Letter of Credit, (iv) the name and address of the beneficiary of the Letter of Credit, and (v) such other information (including, the conditions of drawing, and, in the case of an amendment, renewal, or extension, identification of the Letter of Credit to be so amended, renewed, or extended) as shall be necessary to prepare, amend, renew, or extend such Letter of Credit. Anything contained herein to the contrary notwithstanding, the Issuing Lender may, but shall not be obligated to, issue or cause the issuance of a Letter of Credit or to issue a Reimbursement Undertaking in respect of an Underlying Letter of Credit, in either case, that supports the obligations of Parent or its Subsidiaries (1) in respect of (A) a lease of real property, or (B) an employment contract, or (2) at any time that one or more of the Lenders is a Defaulting Lender. The Issuing Lender shall have no obligation to issue a Letter of Credit or a Reimbursement Undertaking in respect of an Underlying Letter of Credit, in either case, if any of the following would result after giving effect to the requested issuance:

(i) the Letter of Credit Usage would exceed (A) the lesser of (x) the Borrowing Base and (y) the Maximum Revolver Amount less (B) the outstanding amount of Advances (inclusive of Revolver Loans and Swing Loans), or

(ii) the Letter of Credit Usage would exceed $30,000,000.

Borrower and the Lender Group hereby acknowledge and agree that all Existing Letters of Credit shall constitute Letters of Credit under this Agreement on and after the Closing Date with the same effect as if such Existing Letters of Credit were issued by Issuing Lender or an Underlying Issuer at the request of Borrower on the Closing Date. Each Letter of Credit shall be in form and substance reasonably acceptable to the Issuing Lender, including the requirement that the amounts payable thereunder must be payable in Dollars. If Issuing Lender makes a payment under a Letter of Credit or an Underlying Issuer makes a payment under an Underlying Letter of Credit, Borrower shall pay to Agent an amount equal to the applicable Letter of Credit Disbursement on the date such Letter of Credit Disbursement is made and, in the absence of such payment, the amount of the Letter of Credit Disbursement immediately and automatically shall be deemed to be an Advance hereunder and, initially, shall bear interest at the rate then applicable to Advances that are Base Rate Loans. If a Letter of Credit Disbursement is deemed to be an Advance hereunder (notwithstanding any failure to satisfy any condition precedent set forth in Section 3), Borrower’s obligation to pay the amount of such Letter of Credit Disbursement to Issuing Lender shall be automatically converted into an obligation to pay the resulting Advance. Promptly following receipt by Agent of any payment from Borrower

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pursuant to this paragraph, Agent shall distribute such payment to the Issuing Lender or, to the extent that Lenders have made payments pursuant to Section 2.11(b) to reimburse the Issuing Lender, then to such Lenders and the Issuing Lender as their interests may appear.

(b) Promptly following receipt of a notice of a Letter of Credit Disbursement pursuant to Section 2.11(a), each Lender with a Revolver Commitment agrees to fund its Pro Rata Share of any Advance deemed made pursuant to Section 2.11(a) on the same terms and conditions as if Borrower had requested the amount thereof as an Advance and Agent shall promptly pay to Issuing Lender the amounts so received by it from the Lenders. By the issuance of a Letter of Credit or a Reimbursement Undertaking (or an amendment, renewal, or extension of a Letter of Credit or a Reimbursement Undertaking) and without any further action on the part of the Issuing Lender or the Lenders with Revolver Commitments, the Issuing Lender shall be deemed to have granted to each Lender with a Revolver Commitment, and each Lender with a Revolver Commitment shall be deemed to have purchased, a participation in each Letter of Credit issued by Issuing Lender and each Reimbursement Undertaking, in an amount equal to its Pro Rata Share of such Letter of Credit or Reimbursement Undertaking, and each such Lender agrees to pay to Agent, for the account of the Issuing Lender, such Lender’s Pro Rata Share of any Letter of Credit Disbursement made by Issuing Lender or an Underlying Issuer under the applicable Letter of Credit. In consideration and in furtherance of the foregoing, each Lender with a Revolver Commitment hereby absolutely and unconditionally agrees to pay to Agent, for the account of the Issuing Lender, such Lender’s Pro Rata Share of each Letter of Credit Disbursement made by Issuing Lender or an Underlying Issuer and not reimbursed by Borrower on the date due as provided in Section 2.11(a), or of any reimbursement payment required to be refunded (or that Agent or Issuing Lender elects, based upon the advice of counsel, to refund) to Borrower for any reason. Each Lender with a Revolver Commitment acknowledges and agrees that its obligation to deliver to Agent, for the account of the Issuing Lender, an amount equal to its respective Pro Rata Share of each Letter of Credit Disbursement pursuant to this Section 2.11(b) shall be absolute and unconditional and such remittance shall be made notwithstanding the occurrence or continuation of an Event of Default or Default or the failure to satisfy any condition set forth in Section 3. If any such Lender fails to make available to Agent the amount of such Lender’s Pro Rata Share of a Letter of Credit Disbursement as provided in this Section, such Lender shall be deemed to be a Defaulting Lender and Agent (for the account of the Issuing Lender) shall be entitled to recover such amount on demand from such Lender together with interest thereon at the Defaulting Lender Rate until paid in full.

(c) Borrower hereby agrees to indemnify, save, defend, and hold the Lender Group and each Underlying Issuer harmless from any damage, loss, cost, expense, or liability, and reasonable attorneys fees incurred by Issuing Lender, any other member of the Lender Group, or any Underlying Issuer arising out of or in connection with any Reimbursement Undertaking or any Letter of Credit; provided, however, that Borrower shall not be obligated hereunder to indemnify for any loss, cost, expense, or liability that a court of competent jurisdiction finally determines to have resulted from the gross negligence or willful misconduct of the Issuing Lender, any other member of the Lender Group, or any Underlying Issuer. Borrower agrees to be bound by the Underlying Issuer’s regulations and interpretations of any Letter of Credit or by Issuing Lender’s interpretations of any Reimbursement Undertaking even though this interpretation may be different from Borrower’s own, and Borrower understands and agrees that none of the Issuing Lender, any other member of the Lender Group, or any

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Underlying Issuer shall be liable for any error, negligence, or mistake, whether of omission or commission, in following Borrower’s instructions or those contained in the Letter of Credit or any modifications, amendments, or supplements thereto. Borrower understands that the Reimbursement Undertakings may require Issuing Lender to indemnify the Underlying Issuer for certain costs or liabilities arising out of claims by Borrower against such Underlying Issuer. Borrower hereby agrees to indemnify, save, defend, and hold Issuing Lender and the other members of the Lender Group harmless with respect to any loss, cost, expense (including reasonable attorneys fees), or liability (other than taxes but including any taxes that represent losses, claims, damages etc. arising from any non-tax claim) incurred by them as a result of the Issuing Lender’s indemnification of an Underlying Issuer; provided, however, that Borrower shall not be obligated hereunder to indemnify for any such loss, cost, expense, or liability to the extent that it is caused by the gross negligence or willful misconduct of the Issuing Lender or any other member of the Lender Group. Borrower hereby acknowledges and agrees that none of the Issuing Lender, any other member of the Lender Group, or any Underlying Issuer shall be responsible for delays, errors, or omissions resulting from the malfunction of equipment in connection with any Letter of Credit.

(d) The obligation of Borrower to reimburse the Issuing Lender for each drawing under each Letter of Credit 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 another Loan Document,

(ii) the existence of any claim, counterclaim, setoff, defense or other right that Parent or any of its Subsidiaries 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 maybe acting), the Issuing Lender or any other Person, whether in connection with this Agreement, the transactions contemplated hereby or 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 Issuing Lender under such Letter of Credit against presentation of a draft or certificate that does not substantially or strictly comply with the terms of such Letter of Credit (including, without limitation, any requirement that presentation be made at a particular place or by a particular time of day), or any payment made by the Issuing Lender 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,

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(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 discharge of, Borrower or any of its Subsidiaries, or

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

(e) Borrower hereby authorizes and directs any Underlying Issuer to deliver to the Issuing Lender all instruments, documents, and other writings and property received by such Underlying Issuer pursuant to such Underlying Letter of Credit and to accept and rely upon the Issuing Lender’s instructions with respect to all matters arising in connection with such Underlying Letter of Credit and the related application.

(f) Borrower acknowledges and agrees that any and all issuance charges, usage charges, commissions, fees, and costs incurred by the Issuing Lender relating to Underlying Letters of Credit shall be Lender Group Expenses for purposes of this Agreement and shall be reimbursable promptly, but in any event, within 1 Business Day by Borrower to Agent for the account of the Issuing Lender; it being acknowledged and agreed by Borrower that, as of the Closing Date, the usage charge imposed by the Underlying Issuer is 0.125% per annum times the stated amount of each Underlying Letter of Credit and shall be payable in advance upon the issuance of each Letter of Credit, that such usage charge may be changed from time to time, and that the Underlying Issuer also imposes a schedule of charges for amendments, extensions, drawings, and renewals.

(g) If by reason of (i) any change after the Closing Date in any applicable law, treaty, rule, or regulation or any change in the interpretation or application thereof by any Governmental Authority, or (ii) compliance by the Issuing Lender, any other member of the Lender Group, or Underlying Issuer with any direction, request, or requirement (irrespective of whether having the force of law) of any Governmental Authority or monetary authority including, Regulation D of the Federal Reserve Board as from time to time in effect (and any successor thereto):

(i) any reserve, deposit, or similar requirement is or shall be imposed or modified in respect of any Letter of Credit issued or caused to be issued hereunder or hereby,

(ii) any Issuing Lender or other member of the Lender Group or Underlying Issuer shall become subject to any taxes (other than Taxes, including Taxes resulting from a Lender’s failure to provide the forms described in Section 16(c)) on its loans, loan principal, letters of credit, commitments, or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto, or

(iii) there shall be imposed on the Issuing Lender, any other member of the Lender Group, or Underlying Issuer any other condition regarding any Letter of Credit or Reimbursement Undertaking,

and the result of the foregoing is to increase, directly or indirectly, the cost to the Issuing Lender, any other member of the Lender Group, or an Underlying Issuer of issuing, making, participating

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in, or maintaining any Reimbursement Undertaking or Letter of Credit or to reduce the amount receivable in respect thereof, then, and in any such case, Agent may, at any time within a reasonable period after the additional cost is incurred or the amount received is reduced, notify Borrower, and Borrower shall pay within 30 days after demand therefor, such amounts as Agent may specify to be necessary to compensate the Issuing Lender, any other member of the Lender Group, or an Underlying Issuer for such additional cost or reduced receipt, together with interest on such amount from the date of such demand until payment in full thereof at the rate then applicable to Base Rate Loans hereunder; provided, however, that Borrower shall not be required to provide any compensation pursuant to this Section 2.11(g) for any such amounts incurred more than 180 days prior to the date on which the demand for payment of such amounts is first made to Borrower; provided further, however, that if an event or circumstance giving rise to such amounts is retroactive, then the 180-day period referred to above shall be extended to include the period of retroactive effect thereof. The determination by Agent of any amount due pursuant to this Section 2.11(g), as set forth in a certificate setting forth the calculation thereof in reasonable detail, shall, in the absence of manifest or demonstrable error, be final and conclusive and binding on all of the parties hereto.

2.12 LIBOR Option.

(a) Interest and Interest Payment Dates. In lieu of having interest charged at the rate based upon the Base Rate, Borrower shall have the option, subject to Section 2.12(b) below (the “LIBOR Option”) to have interest on all or a portion of the Revolver Loans be charged (whether at the time when made (unless otherwise provided herein), upon conversion from a Base Rate Loan to a LIBOR Rate Loan, or upon continuation of a LIBOR Rate Loan as a LIBOR Rate Loan) at a rate of interest based upon the LIBOR Rate. Interest on LIBOR Rate Loans shall be payable on the earliest of (i) the last day of the Interest Period applicable thereto; provided, however, that, subject to the following clauses (ii) and (iii), in the case of any Interest Period greater than 3 months in duration, interest shall be payable at 3 month intervals after the commencement of the applicable Interest Period and on the last day of such Interest Period; (ii) the date on which all or any portion of the Obligations are accelerated pursuant to the terms hereof, or (iii) the date on which this Agreement is terminated pursuant to the terms hereof. On the last day of each applicable Interest Period, unless Borrower properly has exercised the LIBOR Option with respect thereto, the interest rate applicable to such LIBOR Rate Loan automatically shall convert to the rate of interest then applicable to Base Rate Loans of the same type hereunder. At any time that an Event of Default has occurred and is continuing, unless consented to in writing by the Required Lenders, Borrower no longer shall have the option to request that Advances bear interest at a rate based upon the LIBOR Rate.

(b) LIBOR Election.

(i) Borrower may, at any time and from time to time, so long as no Event of Default has occurred and is continuing (unless the Required Lenders otherwise agree), elect to exercise the LIBOR Option by notifying Agent prior to 2:00 p.m. (New York time) at least 3 Business Days prior to the commencement of the proposed Interest Period (the “LIBOR Deadline”). Notice of Borrower’s election of the LIBOR Option for a permitted portion of the Revolver Loans and an Interest Period pursuant to this Section shall be made by delivery to Agent of a LIBOR Notice received by Agent before the

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LIBOR Deadline, or by telephonic notice received by Agent before the LIBOR Deadline (to be confirmed by delivery to Agent of a LIBOR Notice received by Agent prior to 5:00 p.m. (New York time) on the same day). Promptly upon its receipt of each such LIBOR Notice, Agent shall provide a copy thereof to each of the affected Lenders.

(ii) Each LIBOR Notice shall be irrevocable and binding on Borrower. In connection with each LIBOR Rate Loan, Borrower shall indemnify, defend, and hold Agent and the Lenders harmless against any loss, cost, or expense actually incurred by Agent or any Lender as a result of (A) the payment of any principal of any LIBOR Rate Loan other than on the last day of an Interest Period applicable thereto (including as a result of an Event of Default), (B) the conversion of any LIBOR Rate Loan other than on the last day of the Interest Period applicable thereto, or (C) the failure to borrow, convert, continue or prepay any LIBOR Rate Loan on the date specified in any LIBOR Notice delivered pursuant hereto (such losses, costs, or expenses, “Funding Losses”). A certificate of Agent or a Lender delivered to Borrower setting forth in reasonable detail any amount or amounts that Agent or such Lender is entitled to receive pursuant to this Section 2.12 shall be conclusive absent manifest error. Borrower shall pay such amount to Agent or the Lender, as applicable, within 30 days of the date of its receipt of such certificate. If a payment of a LIBOR Rate Loan on a day other than the last day of the applicable Interest Period would result in a Funding Loss, Agent may, in its sole discretion at the request of Borrower, hold the amount of such payment as cash collateral in support of the Obligations until the last day of such Interest Period and apply such amounts to the payment of the applicable LIBOR Rate Loan on such last day, it being agreed that Agent has no obligation to so defer the application of payments to any LIBOR Rate Loan and that, in the event that Agent does not defer such application, Borrower shall be obligated to pay any resulting Funding Losses.

(iii) Borrower shall have not more than 7 LIBOR Rate Loans in effect at any given time. Borrower only may exercise the LIBOR Option for proposed LIBOR Rate Loans of at least $1,000,000.

(c) Conversion. Borrower may prepay or convert LIBOR Rate Loans to Base Rate Loans at any time; provided, however, that in the event that LIBOR Rate Loans are converted or prepaid on any date that is not the last day of the Interest Period applicable thereto, including as a result of any automatic prepayment through the required application by Agent of proceeds of Parent’s and its Subsidiaries’ Collections in accordance with Section 2.4(b) or for any other reason, including early termination of the term of this Agreement or acceleration of all or any portion of the Obligations pursuant to the terms hereof, Borrower shall indemnify, defend, and hold Agent and the Lenders and their Participants harmless against any and all Funding Losses in accordance with Section 2.12 (b)(ii).

(d) Special Provisions Applicable to LIBOR Rate.

(i) The LIBOR Rate may be adjusted by Agent with respect to any Lender on a prospective basis to take into account any additional or increased costs to such Lender of maintaining or obtaining any eurodollar deposits or increased costs, in each case, due to changes in applicable law occurring subsequent to the commencement

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of the then applicable Interest Period, including changes in tax laws (except changes of general applicability in corporate income tax laws and without duplication of amounts payable under Section 16) and changes in the reserve requirements imposed by the Board of Governors of the Federal Reserve System (or any successor), which additional or increased costs would increase the cost of funding or maintaining loans bearing interest at the LIBOR Rate. In any such event, the affected Lender shall give Borrower and Agent notice of such a determination and adjustment and Agent promptly shall transmit the notice to each other Lender and, upon its receipt of the notice from the affected Lender, Borrower may, by notice to such affected Lender (y) require such Lender to furnish to Borrower a statement setting forth the basis for adjusting such LIBOR Rate and the method for determining the amount of such adjustment, or (z) repay the LIBOR Rate Loans with respect to which such adjustment is made (together with any amounts due under Section 2.12(b)(ii)).

(ii) In the event that any change in market conditions or any law, regulation, treaty, or directive, or any change therein or in the interpretation or application thereof, shall at any time after the date hereof, in the reasonable opinion of any Lender, make it unlawful or impractical for such Lender to fund or maintain LIBOR Rate Loans or to continue such funding or maintaining, or to determine or charge interest rates at the LIBOR Rate, such Lender shall give notice of such changed circumstances to Agent and Borrower and Agent promptly shall transmit the notice to each other Lender and (y) in the case of any LIBOR Rate Loans of such Lender that are outstanding, the date specified in such Lender’s notice shall be deemed to be the last day of the Interest Period of such LIBOR Rate Loans, and interest upon the LIBOR Rate Loans of such Lender thereafter shall accrue interest at the rate then applicable to Base Rate Loans, and (z) Borrower shall not be entitled to elect the LIBOR Option until such Lender determines that it would no longer be unlawful or impractical to do so.

(e) No Requirement of Matched Funding. Anything to the contrary contained herein notwithstanding, neither Agent, nor any Lender, nor any of their Participants, is required actually to acquire eurodollar deposits to fund or otherwise match fund any Obligation as to which interest accrues at the LIBOR Rate.

2.13 Capital Requirements.

(a) If, after the date hereof, any Lender determines that (i) the adoption of or change in any law, rule, regulation or guideline regarding capital requirements for banks or bank holding companies, or any change in the interpretation, implementation, or application thereof by any Governmental Authority charged with the administration thereof, or (ii) compliance by such Lender or its parent bank holding company with any guideline, request or directive of any such entity regarding capital adequacy (whether or not having the force of law), has the effect of reducing the return on such Lender’s or such holding company’s capital as a consequence of such Lender’s Revolver Commitments hereunder to a level below that which such Lender or such holding company could have achieved but for such adoption, change, or compliance (taking into consideration such Lender’s or such holding company’s then existing policies with respect to capital adequacy and assuming the full utilization of such entity’s capital) by any amount deemed by such Lender to be material, then such Lender may notify Borrower and Agent

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thereof. Following receipt of such notice, Borrower agrees to pay such Lender on demand the amount of such reduction of return of capital as and when such reduction is determined, payable within 30 days after presentation by such Lender of a statement in the amount and setting forth in reasonable detail such Lender’s calculation thereof and the assumptions upon which such calculation was based (which statement shall be deemed true and correct absent manifest error). In determining such amount, such Lender may use any reasonable averaging and attribution methods. Failure or delay on the part of any Lender to demand compensation pursuant to this Section shall not constitute a waiver of such Lender’s right to demand such compensation; provided that Borrower shall not be required to compensate a Lender pursuant to this Section for any reductions in return incurred more than 180 days prior to the date that such Lender notifies Borrower of such law, rule, regulation or guideline giving rise to such reductions and of such Lender’s intention to claim compensation therefor; provided further that if such claim arises by reason of the adoption of or change in any law, rule, regulation or guideline that is retroactive, then the 180-day period referred to above shall be extended to include the period of retroactive effect thereof.

(b) If any Lender requests additional or increased costs referred to in Section 2.12(d)(i) or amounts under Section 2.11(g) or Section 2.13(a) or sends a notice under Section 2.12(d)(ii) relative to changed circumstances (any such Lender, an “Affected Lender”), then such Affected Lender shall use reasonable efforts to promptly designate a different one of its lending offices or to assign its rights and obligations hereunder to another of its offices or branches, if (i) in the reasonable judgment of such Affected Lender, such designation or assignment would eliminate or reduce amounts payable pursuant to Section 2.12(d)(i) or Section 2.13(a), as applicable, or would eliminate the illegality or impracticality of funding or maintaining LIBOR Rate Loans and (ii) in the reasonable judgment of such Affected Lender, such designation or assignment would not subject it to any material unreimbursed cost or expense and would not otherwise be materially disadvantageous to it. Borrower agrees to pay all reasonable out-of-pocket costs and expenses incurred by such Affected Lender in connection with any such designation or assignment. If, after such reasonable efforts, such Affected Lender does not so designate a different one of its lending offices or assign its rights to another of its offices or branches so as to eliminate Borrower’s obligation to pay any future amounts to such Affected Lender pursuant to Section 2.12(d)(i), Section 2.11(g) or Section 2.13(a), as applicable, or to enable Borrower to Obtain LIBOR Rate Loans, then Borrower (without prejudice to any amounts then due to such Affected Lender under Section 2.12(d)(i), Section 2.11(g) or Section 2.13(a), as applicable) may, unless prior to the effective date of any such assignment the Affected Lender withdraws its request for such additional amounts under Section 2.12(d)(i), Section 2.11(g) or Section 2.13(a), as applicable, or indicates that it is no longer unlawful or impractical to fund or maintain LIBOR Rate Loans, may seek a substitute Lender reasonably acceptable to Agent to purchase the Obligations owed to such Affected Lender and such Affected Lender’s Revolver Commitments hereunder (a “Replacement Lender”), and if such Replacement Lender agrees to such purchase, such Affected Lender shall assign to the Replacement Lender its Obligations and Revolver Commitments, pursuant to an Assignment and Acceptance Agreement, and upon such purchase by the Replacement Lender, such Replacement Lender shall be deemed to be a “Lender” for purposes of this Agreement and such Affected Lender shall cease to be a “Lender” for purposes of this Agreement.

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2.14 Increase Option.

(a) Request for Increase. Provided there exists no Default or Event of Default, upon notice to Agent (which shall promptly notify Lenders), Borrower may from time to time, request an increase in the Maximum Revolver Amount by an amount (for all such requests) not exceeding $25,000,000; provided that any such request for an increase shall be in a minimum amount of $5,000,000. At the time of sending such notice, Borrower (in consultation with 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 Lenders).

(b) Lender Elections to Increase. Each Lender shall notify Agent within such time period whether or not it agrees to increase its Revolver Commitment and, if so, whether by an amount equal to, greater than, or less than its Pro Rata Share of such requested increase. Any Lender not responding within such time period shall be deemed to have declined to increase its Revolver Commitment.

(c) Notification by Agent; Additional Lenders. Agent shall notify Borrower and each Lender of Lenders’ responses to each request made hereunder. To achieve the full amount of a requested increase and subject to the approval of Agent, the Issuing Lender and the Swing Lender (which approvals shall not be unreasonably withheld, conditioned or delayed), Borrower may also invite additional Eligible Transferees to become Lenders pursuant to a joinder agreement in form and substance satisfactory to Agent.

(d) Closing Date and Allocations. If the Maximum Revolver Amount is increased in accordance with this Section, Agent and Borrower shall determine the effective date (the “Increase Closing Date”) and the final allocation of such increase. Agent shall promptly notify Borrower and Lenders of the final allocation of such increase and the Increase Closing Date.

(e) Conditions to Effectiveness of Increase. As a condition precedent to such increase, (i) Borrower shall deliver to Agent a certificate dated as of the Increase Closing Date signed by a Responsible Officer of Borrower (A) certifying and attaching the resolutions adopted by Borrower approving or consenting to such increase, and (B) certifying that, before and after giving effect to such increase, (I) the representations and warranties of the Loan Parties contained in this Agreement or in the other Loan Documents shall be true and correct in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof) on the Increase Closing Date (except to the extent that such representations and warranties relate solely to an earlier date), and (II) no Default or Event of Default shall have occurred and be continuing on the Increase Closing Date, nor shall either result from the making thereof and (ii) the Guarantors shall deliver to Agent a reaffirmation of their obligations under the Guaranty in form and substance satisfactory to Agent. The outstanding Revolver Loans and other Advances and Pro Rata Shares of Swing Loans and Letters of Credit will be reallocated by Agent on the applicable Increase Closing Date among Lenders (including the new Lenders providing a portion of such increase) in accordance with their revised Pro Rata Shares and Lenders (including such new Lenders) agree (1) to make all payments and adjustments necessary to effect such reallocation and Borrower shall pay any and all costs required pursuant to Section 2.12 in connection with such reallocation as if such reallocation were a repayment and (2)

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without any further action or consent on the part of any Lender, Agent and Borrower may amend this Agreement and any other Loan Documents to effect any changes to the Loan Documents as may be necessary to reflect such increase and the reallocation of the Pro Rata Shares of the Lenders, that do not otherwise adversely affect the rights of any Lenders.

3. CONDITIONS; TERM OF AGREEMENT.

3.1 Conditions Precedent to the Initial Extension of Credit. The obligation of each Lender to make its initial Extension of Credit provided for hereunder is subject to the satisfaction (or waiver by Agent and the Require Lenders) of each of the conditions precedent set forth on Schedule 3.1 (the making of such initial extension of credit being conclusively deemed to be the satisfaction or waiver of the conditions precedent ).

3.2 Conditions Precedent to all Extensions of Credit. The obligation of the Lender Group (or any member thereof) to make any Extension of Credit at any time shall be subject to the satisfaction (or waiver by the Required Lenders) of the following conditions precedent (and each request for an Advance or other Extension of Credit, and the acceptance by Borrower of the proceeds of any such Advance or making of any other Extension of Credit, shall constitute a representation and warranty by Borrower that on the date of such Advance or other Extension of Credit before and after giving effect thereto and to the application of the proceeds therefrom, such statements below are true and correct):

(a) the representations and warranties of the Loan Parties contained in this Agreement or in the other Loan Documents shall be true and correct in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof) on and as of the date of such Extension of Credit, as though made on and as of such date (except to the extent that such representations and warranties relate solely to an earlier date);

(b) no Default or Event of Default shall have occurred and be continuing on the date of such Extension of Credit, nor shall either result from the making thereof; and

(c) Revolver Usage (after giving effect to such requested Extension of Credit) shall not exceed the lesser of (i) the Maximum Revolver Amount and (ii) the Borrowing Base.

3.3 Maturity. This Agreement shall continue in full force and effect for a term ending on October 5, 2016 (the “Maturity Date”); provided that if the Secured Notes (First Lien) and the Secured Notes (Second Lien) shall have not been repaid, refinanced, or defeased in full or, in the reasonable determination of Agent, adequately reserved for or cash collateralized on or prior to the 90^th day immediately preceding the maturity date of the Secured Notes (First Lien), the Secured Notes (Second Lien) and any Additional Notes (and any Refinancing Indebtedness in respect of the foregoing) permitted hereunder, then the Maturity Date will occur on such 90^th day; provided further that, with respect to any refinancing, such refinanced notes shall have a maturity date that is at least 90 days later than the Maturity Date. The foregoing notwithstanding, the Lender Group, upon the election of the Required Lenders, shall have the right to terminate its obligations under this Agreement immediately and without notice upon the occurrence and during the continuation of an Event of Default.

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3.4 Effect of Maturity. On the Maturity Date, all commitments of the Lender Group to provide additional credit hereunder shall automatically be terminated and the Obligations (other than Contingent Obligations) immediately shall become due and payable without notice or demand and Borrower shall be required to repay all of the Obligations (other than Contingent Obligations) in full. No termination of the obligations of the Lender Group (other than payment in full of the Obligations and termination of the Revolver Commitments) shall relieve or discharge any Loan Party of its duties, obligations, or covenants hereunder or under any other Loan Document and Agent’s Liens in the Collateral shall continue to secure the Obligations and shall remain in effect until all Obligations have been paid in full and the Revolver Commitments have been terminated. When all of the Obligations have been paid in full and the Lender Group’s obligations to provide additional credit under the Loan Documents have been terminated irrevocably, Agent will, at Borrower’s sole expense, execute and deliver any termination statements, lien releases, discharges of security interests, and other similar discharge or release documents (and, if applicable, in recordable form) as are reasonably necessary to release, as of record, Agent’s Liens and any and all notices of security interests and Liens previously filed in favor of Agent.

3.5 Early Termination by Borrower. Borrower has the option, at any time upon 5 Business Days prior written notice to Agent, to terminate this Agreement and terminate the Revolver Commitments hereunder by repaying to Agent the Obligations in full.

3.6 Conditions Subsequent, Etc. The obligation of the Lender Group (or any member thereof) to continue to make Advances (or otherwise make Extensions of Credit hereunder) is subject to the satisfaction or waiver, on or before the date applicable thereto (or such later date as the Agent may agree in its sole discretion), of the conditions subsequent and the other requirements set forth on Schedule 3.6.

4. REPRESENTATIONS AND WARRANTIES.

In order to induce the Lender Group to enter into this Agreement, Parent and Borrower hereby represent and warrant to the Lender Group that:

4.1 Due Organization and Qualification; Subsidiaries.

(a) Each Loan Party (i) is duly organized and existing and in good standing under the laws of the jurisdiction of its organization, (ii) is qualified to do business in any state where the failure to be so qualified could reasonably be expected to result in a Material Adverse Change (iii) has all requisite power and authority to own and operate its properties, to carry on its business as conducted where the failure to comply with this clause (iii) could reasonably be expected to result in a Material Adverse Change and (iv) has all requisite power and authority to, to enter into and perform under the Loan Documents to which it is a party and to carry out the Transactions.

(b) Set forth on Schedule 4.1 is a complete and accurate description of the authorized capital Stock of Parent, by class, and, as of the Closing Date, a description of the number of shares of each such class that are issued and outstanding.

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(c) Set forth on Schedule 4.1, is a complete and accurate list of the Loan Parties’ direct and indirect Subsidiaries as of the Closing Date, showing, as of the Closing Date: (i) the number and percentage of each class of Stock owned directly or indirectly by Parent and its Subsidiaries in each of such Subsidiaries, and (ii) the number of shares of each class of common and preferred Stock (if any) authorized for each Loan Party and its Subsidiaries. All of the outstanding capital Stock of each such Subsidiary has been validly issued and is fully paid and non-assessable.

(d) Except as set forth on Schedule 4.1, there are no subscriptions, options, warrants, or calls relating to any shares of Parent’s Subsidiaries’ capital Stock, including any right of conversion or exchange under any outstanding security or other instrument. Neither Parent nor any of its Subsidiaries is subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of Parent’s Subsidiaries’ capital Stock or any security convertible into or exchangeable for any such capital Stock.

4.2 Due Authorization; No Conflict.

(a) As to each Loan Party, the execution, delivery, and performance by such Loan Party of the Loan Documents to which it is a party have been duly authorized by all necessary corporate or other organizational action on the part of such Loan Party.

(b) As to each Loan Party, the execution, delivery, and performance by such Loan Party of the Loan Documents to which it is a party do not and will not (i) violate any material provision of federal, state, or local law or regulation applicable to such Loan Party or its Subsidiaries, the Governing Documents of such Loan Party, or any order, judgment, or decree of any court or other Governmental Authority binding on such Loan Party or its Subsidiaries, other than violations which, individually or in the aggregate could not reasonably be expected to result in a Material Adverse Change, (ii) conflict with, result in a breach of, or constitute (with due notice or lapse of time or both) a default under any Material Contract (except those as to which waivers or consents have been obtained) except to the extent that any such conflict, breach or default could not individually or in the aggregate reasonably be expected to result in a Material Adverse Change, (iii) result in or require the creation or imposition of any Lien upon any assets of any Loan Party, other than Permitted Liens, or (iv) require any approval of any Loan Party’s equity holders or any approval or consent of any Person under any Material Contract, other than consents or approvals that have been obtained and that are still in force and effect and except, in the case of Material Contracts, for consents or approvals, the failure to obtain could not individually or in the aggregate reasonably be expected to result in a Material Adverse Change.

4.3 Governmental Consents. (i) The execution, delivery, and performance by each Loan Party of the Loan Documents to which such Loan Party is a party, (ii) the acceptance of Extensions of Credit by the Borrower, (iii) the making of the Guaranty and (iv) the consummation of the other Transactions, in each case, do not and will not require any registration with, consent, or approval of, or notice to, or other action with or by, any Governmental Authority, other than registrations, consents, approvals, notices, or other actions that have been obtained and that are still in force and effect and except for filings and recordings with respect to the Collateral to be made, or otherwise delivered to Agent for filing or recordation, as of the Closing Date or, if later, as specified in Schedule 3.6 or as required pursuant to Section 5.11 or 5.12 or the Security Agreement.

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4.4 Binding Obligations; Perfected Liens.

(a) Each Loan Document has been duly executed and delivered by each Loan Party that is a party thereto and is the legally valid and binding obligation of such Loan Party, enforceable against such Loan Party in accordance with its respective terms, except as enforcement may be limited by equitable principles (whether enforcement is sought by proceedings in equity or at law) or by bankruptcy, insolvency, reorganization, moratorium, or similar laws relating to or limiting creditors’ rights generally.

(b) Agent’s Liens are and will be (other than with respect to Excluded Assets):

(i) validly created;

(ii) perfected (to the extent required under the Loan Documents) (A) with respect to ABL Priority Collateral, upon the (I) execution and delivery of Control Agreements with respect to Deposit Accounts and Securities Accounts (other than Excluded Accounts) as contemplated by the Loan Documents and (II) the filing of financing statements and (B) with respect to the Secured Notes Priority Collateral, upon the (I) execution and delivery of Control Agreements with respect to Deposit Accounts and Securities Accounts (other than Excluded Accounts) as contemplated by the Loan Documents, (II) the filing of financing statements, the filing of intellectual property security agreements with the United States Patent and Trademark Office and/or the United States Copyright Office, the recordation of Mortgages and the filing and recording of Vessel Fleet Mortgages, in each case, in the appropriate filing offices and the payment of the associated filing or recordation fees (provided that it is acknowledged that the Liens shall not be perfected with respect to any non-U.S. copyrights, patents or trademarks), and (III) the taking of possession or control by the Agent or the collateral agent under Secured Notes Documents of the Collateral with respect to which a security interest may be perfected only by possession or control in each case under this clause (ii), to the extent such Liens can be perfected by such actions, and

(iii) to the extent perfected as set forth in clause (ii) above, first priority in and upon the ABL Priority Collateral and, in the case of Secured Notes Priority Collateral, the priority set forth in the Intercreditor Agreement (subject, in each case, only to Permitted Liens and the relative priorities thereof).

4.5 Title to Assets; No Encumbrances. Each of the Loan Parties and its Subsidiaries has (a) good, marketable and legal title to (in the case of fee interests in Real Property), (b) valid leasehold interests in (in the case of leasehold interests in real or personal property), and (c) good and marketable title to or a license or other right to use (in the case of all other personal property), all of its respective assets (except for minor defects in title to property that do not materially interfere with its ability to conduct its business as currently conducted or to use such properties for their intended purposes), which, together with assets leased or licensed by

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the Loan Parties and their Subsidiaries, represents all assets in the aggregate material to the conduct of the business of the Loan Parties and their Subsidiaries. After giving effect to the Transactions, none of such assets are subject to any Lien except for Permitted Liens.

4.6 Jurisdiction of Organization; Location of Chief Executive Office; Organizational Identification Number; Commercial Tort Claims.

(a) The name of (within the meaning of Section 9-503 of the Code) and jurisdiction of organization of each Loan Party and each of its Subsidiaries is set forth on Schedule 4.6(a) (as such Schedule may be updated from time to time to reflect changes resulting from transactions permitted under this Agreement).

(b) The chief executive office of each Loan Party and each of its Subsidiaries is located at the address indicated on Schedule 4.6(b) (as such Schedule may be updated from time to time to reflect changes resulting from transactions permitted under this Agreement).

(c) Each Loan Party’s and each of its Subsidiaries’ tax identification numbers and organizational identification numbers, if any, are identified on Schedule 4.6(c) (as such Schedule may be updated from time to time to reflect changes resulting from transactions permitted under this Agreement).

(d) As of the Closing Date, no Loan Party holds any commercial tort claims for which the expected amount recoverable exceeds $1,000,000, except as set forth on Schedule 4.6(d).

4.7 Litigation. Except as specifically set forth on Schedule 4.7, there are no actions, suits, or proceedings pending or, to the knowledge of any Loan Party, threatened in writing against a Loan Party, any of its Subsidiaries or any assets thereof that either individually or in the aggregate could reasonably be expected to result in a Material Adverse Change.

4.8 Compliance with Laws. No Loan Party nor any of its Subsidiaries (a) is in violation of any applicable laws, rules, regulations, executive orders, or codes (including Environmental Laws) that, individually or in the aggregate, could reasonably be expected to result in a Material Adverse Change, or (b) is subject to or in default with respect to any final judgments, writs, injunctions, decrees, rules or regulations of any Governmental Authority, that, individually or in the aggregate, could reasonably be expected to result in a Material Adverse Change.

4.9 No Material Adverse Change. All historical financial statements relating to the Loan Parties and their Subsidiaries that have been delivered by Parent or Borrower to Agent have been prepared in accordance with GAAP (except, in the case of unaudited financial statements, for the lack of footnotes and being subject to year-end audit adjustments) and present fairly in all material respects, the Loan Parties’ and their Subsidiaries’ consolidated financial condition as of the date thereof and results of operations for the period then ended. Since December 26, 2010, no event, circumstance, or change has occurred that has resulted or could reasonably be expected to result in a Material Adverse Change.

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4.10 Fraudulent Transfer.

(a) After giving effect to the Transactions, Borrower and its Subsidiaries, taken as a whole, are Solvent.

(b) In executing the Loan Documents and consummating the Transactions, no Loan Party intends to hinder, delay, or defraud either present or future creditors of such Loan Party.

4.11 Employee Benefits.

(a) Each Loan Party and each ERISA Affiliate is in compliance with all applicable provisions of ERISA, the IRC and the regulations and published interpretations thereunder with respect to all Employee Benefit Plans except for any required amendments for which the remedial amendment period as defined in Section 401(b) of the IRC has not yet expired and except where a failure to so comply could not reasonably be expected to have a Material Adverse Change. No liability has been incurred by any Loan Party or any ERISA Affiliate which remains unsatisfied for any taxes or penalties assessed with respect to any Employee Benefit Plan or any Multiemployer Plan except for a liability that could not reasonably be expected to result in a Material Adverse Change.

(b) As of the Closing Date, no Pension Plan has been terminated, nor has any Pension Plan become subject to funding based benefit restrictions under Section 436 of the IRC, nor has any funding waiver from the Internal Revenue Service been received or requested with respect to any Pension Plan, nor has any Loan Party or any ERISA Affiliate failed to make any contributions or to pay any amounts due and owing with respect to a Pension Plan as required by Sections 412 or 430 of the IRC, Section 302 of ERISA or the terms of any Pension Plan prior to the due dates of such contributions under Sections 412 or 430 of the IRC or Section 302 of ERISA, nor has there been any event requiring any disclosure under Section 4041(c)(3)(C) or 4063(a) of ERISA with respect to any Pension Plan except, in each case, as could not reasonably be expected to result in a Material Adverse Change.

(c) Except where the failure of any of the following representations to be correct could not reasonably be expected to result in a Material Adverse Change, no Loan Party nor any ERISA Affiliate has: (i) engaged in a nonexempt prohibited transaction described in Section 406 of the ERISA or Section 4975 of the IRC, (ii) incurred any liability to the PBGC which remains outstanding other than the payment of premiums and there are no premium payments which are due and unpaid, (iii) failed to make a required contribution or payment to a Multiemployer Plan, or (iv) failed to make a required installment or other required payment under Sections 412 or 430 of the IRC.

(d) No Termination Event has occurred or is reasonably expected to occur which reasonably could be expected to result in a Material Adverse Change.

(e) Except where the failure of any of the following representations to be correct in all material respects could not reasonably be expected to result in a Material Adverse Change, no proceeding, claim (other than a benefits claim in the ordinary course of business), lawsuit and/or investigation is existing or, to the best of the knowledge of Parent and Borrower after due inquiry, threatened concerning or involving any Employee Benefit Plan.

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4.12 Environmental Condition. Except as set forth on Schedule 4.12, (a) no Loan Party’s nor any of its Subsidiaries’ properties or assets has ever been used by a Loan Party, its Subsidiaries, or by previous owners or operators in the disposal of, or to produce, store, handle, treat, release, or transport, any Hazardous Materials, where such disposal, production, storage, handling, treatment, release or transport was in violation of any applicable Environmental Law that could reasonably be expected to result in a Material Adverse Change, (b) no Loan Party’s nor any of its Subsidiaries’ properties or assets has ever been designated or identified in any manner pursuant to any environmental protection statute as a Hazardous Materials disposal site for which such designation or identification could reasonably be expected to result in a Material Adverse Change, (c) no Loan Party nor any of its Subsidiaries has received notice that an Environmental Lien has attached to any revenues or to any Real Property owned or operated by a Loan Party or its Subsidiaries, and (d) no Loan Party nor any of its Subsidiaries nor any of their respective facilities or operations is subject to any outstanding written order, consent decree, or settlement agreement with any Person relating to any Environmental Law or Environmental Liability that, individually or in the aggregate, could reasonably be expected to result in a Material Adverse Change.

4.13 Intellectual Property. Each Loan Party and its Subsidiaries own, or hold licenses or other valid rights to use, all trademarks, trade names, copyrights, patents, and licenses that are material to the conduct of its business as currently conducted, and attached hereto as Schedule 4.13 is a true, correct, and complete listing, as of the Closing Date, of all material registered or applied for trademarks, copyrights and patents as to which Parent or one of its Subsidiaries is the owner or is an exclusive licensee.

4.14 Leases. (a) Each Loan Party and its Subsidiaries enjoy peaceful and undisturbed possession under all of its leases to which they are parties or under which they are operating, (b) all of such leases are valid, subsisting and in full force and effect, except as may be limited by bankruptcy, insolvency, reorganization or other laws affecting creditor’s rights generally and by general equitable principles and (c) no material default by the applicable Loan Party or its Subsidiaries exists under any such leases, except, in each case of the foregoing clauses (a), (b), and (c), as could not reasonably be expected to result, individually or in the aggregate, in a Material Adverse Change.

4.15 Deposit Accounts and Securities Accounts. Set forth on Schedule 4.15 (as updated pursuant to the provisions of the Security Agreement from time to time) is a listing of all of the Loan Parties’ Deposit Accounts and Securities Accounts, including, with respect to each bank or securities intermediary (a) the name and address of such Person, (b) the account numbers of the Deposit Accounts or Securities Accounts maintained with such Person, and (c) identification of any Excluded Accounts and any Controlled Account.

4.16 Complete Disclosure. All factual information taken as a whole (other than forward-looking information, projections, information of a general economic nature and general information about Borrower’s industry) furnished by or on behalf of a Loan Party or its Subsidiaries in writing to Agent or any Lender (including all information contained in the Schedules hereto or in the other Loan Documents) for purposes of or in connection with this Agreement or the other Loan Documents, and all other such factual information taken as a whole (other than forward-looking information, projections, information of a general economic nature

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and general information about Borrower’s industry) hereafter furnished by or on behalf of a Loan Party or its Subsidiaries in writing to Agent or any Lender will be, true and accurate, in all material respects, on the date as of which such information is dated or certified and not incomplete by omitting to state any fact necessary to make such information (taken as a whole) not misleading in any material respect at such time in light of the circumstances under which such information was provided. The Projections delivered to Agent on August 3, 2011 represent, and as of the date on which any other Projections are delivered to Agent, such additional Projections represent, Borrower’s good faith estimate, on the date such Projections are delivered, of the Loan Parties’ and their Subsidiaries’ future performance for the periods covered thereby based upon assumptions believed by Borrower to be reasonable at the time of the delivery thereof to Agent (provided, it is understood that such Projections are subject to uncertainties and contingencies, many of which are beyond the control of the Loan Parties and their Subsidiaries, that no assurances can be given that such Projections will be realized, and that actual results may differ in a material manner from such Projections).

4.17 Material Contracts. Set forth on Schedule 4.17 in reasonable detail is a list of the Material Contracts as of the Closing Date. Except for matters which, either individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Change, each Material Contract (other than those that have expired at the end of their normal terms) (a) is in full force and effect and (b) is not in default due to the action or inaction of the applicable Loan Party.

4.18 Patriot Act. To the extent applicable, each Loan Party is in compliance, in all material respects, with the (a) Trading with the Enemy Act, as amended, and each of the foreign assets control regulations of the United States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) and any other enabling legislation or executive order relating thereto, and (b) Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA Patriot Act of 2001) (the “Patriot Act”). No part of the proceeds of the loans made hereunder will be used by any Loan Party or any of their Affiliates, 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.

4.19 Indebtedness. Set forth on Schedule 4.19 is (a) a true and complete list of all Indebtedness of each Loan Party and each of its Subsidiaries with a principal balance of more than $1,000,000 outstanding as of the dates specified therein or if not so specified, the Closing Date, that is to remain outstanding immediately after giving effect to the closing hereunder on the Closing Date, and (b) certain other Indebtedness of each Loan Party and each of its Subsidiaries with a principal balance of $1,000,000 or less outstanding on the Closing Date that is to remain outstanding immediately after giving effect to the closing hereunder on the Closing Date, and in the case of clause (b), such Schedule accurately sets forth the approximate aggregate principal amount of such Indebtedness as of the dates specified therein or if not so specified, the Closing Date.

4.20 Payment of Taxes. Except as otherwise permitted under Section 5.5, all material tax and information returns and reports of each Loan Party and its Subsidiaries required to be

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filed by any of them have been timely filed, and all material taxes due and payable and all material assessments, fees and other governmental charges upon a Loan Party and its Subsidiaries and upon their respective assets, income, businesses and franchises that are due and payable have been paid before becoming delinquent and having penalties attach thereto. Each Loan Party and each of its Subsidiaries have made adequate provision in accordance with GAAP for all material taxes not yet due and payable. Borrower knows of no material proposed tax assessment against a Loan Party or any of its Subsidiaries that is not being actively contested by such Loan Party or such Subsidiary diligently, in good faith, and by appropriate proceedings; provided such reserves or other appropriate provisions, if any, as shall be required in conformity with GAAP shall have been made or provided therefor.

4.21 Margin Stock. No Loan Party nor any of its Subsidiaries is engaged principally, or as one of its important activities, in the business of extending credit for the purpose of purchasing or carrying any Margin Stock. No part of the proceeds of the Advances or other Extensions of Credit made to Borrower will be used to purchase or carry any such Margin Stock or to extend credit to others for the purpose of purchasing or carrying any such margin stock or for any purpose that violates the provisions of Regulation T, U or X of the Board of Governors of the United States Federal Reserve.

4.22 Governmental Regulation. No Loan Party nor any of its Subsidiaries is subject to regulation under the Federal Power Act or the Investment Company Act of 1940 or under any other federal or state statute or regulation which may limit its ability to incur Indebtedness or which may otherwise render all or any portion of the Obligations unenforceable. No Loan Party nor any of its Subsidiaries is a “registered investment company” or a company “controlled” by a “registered investment company” or a “principal underwriter” of a “registered investment company” as such terms are defined in the Investment Company Act of 1940.

4.23 OFAC. No Loan Party nor any of its Subsidiaries is in violation of any of the country or list based economic and trade sanctions administered and enforced by OFAC. No Loan Party nor any of its Subsidiaries (a) is a Sanctioned Person or a Sanctioned Entity, (b) has its assets located in Sanctioned Entities, or (c) derives revenues from investments in, or transactions with Sanctioned Persons or Sanctioned Entities. No proceeds of any loan made hereunder will be used to fund any operations in, finance any investments or activities in, or make any payments to, a Sanctioned Person or a Sanctioned Entity.

4.24 Employee and Labor Matters. There is (i) no unfair labor practice complaint pending or, to the knowledge of Parent and Borrower, threatened against Parent or its Subsidiaries before any Governmental Authority and no grievance or arbitration proceeding pending or threatened against Parent or its Subsidiaries which arises out of or under any collective bargaining agreement and that could reasonably be expected to result in a material liability, or (ii) no strike, labor dispute, slowdown, stoppage or similar action or grievance pending or threatened in writing against Parent or its Subsidiaries that could reasonably be expected to result in a material liability.

4.25 Eligible Accounts. As to each Account that is identified by Borrower as an Eligible Account in a Borrowing Base Certificate submitted to Agent, such Account is (a) a bona fide existing payment obligation of the applicable Account Debtor created by the sale and

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delivery of Inventory or the rendition of services to such Account Debtor in the ordinary course of Borrower’s business, (b) owed to a Loan Party, and (c) not excluded as ineligible by virtue of one or more of the excluding criteria (other than Agent-discretionary criteria) set forth in the definition of Eligible Accounts.

4.26 Owned and Leased Locations. Schedule 4.26 sets forth, as of the Closing Date, a complete and accurate list of all real property owned or leased by each Loan Party and identifies (a) whether such property is owned or leased, (b) those properties where the books and records of any Loan Party pertaining to ABL Priority Collateral are located and (c), if such locations identified under clause (b) are leased, the lessor with respect to such property and the monthly lease payments.

4.27 Reserved.

4.28 Vessels. Schedule 4.28 sets forth, as of the Closing Date, for each Vessel, (a) its name, (b) its owner, (c) the arrangements (including intercompany arrangements) pursuant to which the Vessel is chartered or operated by any Loan Party or Subsidiary as of the Closing Date, (d) its class description, (e) the name of its classification society, (f) its shipyard and year in which the Vessel was constructed and (g) any and all applicable Chartered Vessel Documents. Except as could not reasonably be expected to result, individually or in the aggregate, in a Material Adverse Change, the Loan Parties and their Subsidiaries own or are licensed or otherwise have the right to use all Vessels. Except as could not reasonably be expected to result, individually or in the aggregate, in a Material Adverse Change, each Vessel (i) is adequate and suitable for use by such Loan Party or Subsidiary in its business as presently conducted by it, ordinary wear and tear and depreciation excepted; (ii) is seaworthy for hull and machinery insurance warranty purposes; (iii) is insured in accordance with the Vessel Fleet Mortgage and each of the arrangements pursuant to which the Vessel is chartered or operated by the Loan Parties as set forth in Schedule 4.28; (iv) is in compliance with any applicable Chartered Vessel Documents covering such Vessel; (v) is in compliance with all Federal, state, local or foreign statutes, laws, regulations, ordinances, rules, judgments, orders, code and decrees, or rule of common law (including Environmental Laws) as are applicable to Vessels documented under U.S. flag and is operated by a Loan Party or any Subsidiary in accordance with past practice; (vi) is properly documented under the U.S. flag and owned by a Person eligible to document the Vessel pursuant to 46 U.S.C. § 12103, and if holding a coastwise trade endorsement, is owned by a Person deemed to be (or in the case of a Chartered Vessel, a Person who has represented to Parent, Borrower, and the U.S. Coast Guard, that it is) a “citizen of the United States” within the meaning of 46 U.S.C. § 50501(a) and (d); and (vii) except as set forth on Schedule 4.28, is in compliance with the requirements of its present class and classification society. As of the Closing Date, all of the Vessels are in class.

4.29 Jones Act Trade. Each of the Loan Parties and their Subsidiaries, in each case, to the extent it owns or operates Vessels in the coastwise trade of the United States, is a “citizen of the United States” within the meaning of 46 U.S.C. § 50501(a) and (d). Each of the Mortgaged Vessels is duly documented in the name of the respective Loan Party or Subsidiary and duly qualified for the coastwise trade of the United States. Each of the Vessels covered by a Chartered Vessel Document is duly documented (or upon delivery by the shipyard building the same will be duly documented) in the name of the owner thereof and the relevant Chartered Vessel Documents are or shall be in full force and effect.

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5. AFFIRMATIVE COVENANTS.

Each of Parent and Borrower covenants and agrees that, until termination of all of the Revolver Commitments and payment in full of the Obligations (other than Contingent Obligations), the Loan Parties shall and shall cause each of their Subsidiaries to comply with each of the following:

5.1 Financial Statements, Reports, Certificates. Deliver to Agent, each of the financial statements, reports, and other items set forth on Schedule 5.1 no later than the times specified therein. In addition, each of Parent and Borrower agrees that no Subsidiary of a Loan Party will have a fiscal year different from that of Parent other than any Subsidiary acquired after the Closing Date, in which case Parent shall cause such Subsidiary to have the same fiscal year as Parent as soon as reasonably practicable after the date of acquisition thereof. In addition, Parent agrees to maintain a system of accounting that enables Parent to produce financial statements in accordance with GAAP. Each Loan Party shall also (a) keep a reporting system that shows all additions, sales, claims, returns, and allowances with respect to its and its Subsidiaries’ sales, and (b) maintain its billing systems/practices substantially as in effect as of the Closing Date and shall only make material modifications thereto with notice to Agent.

5.2 Collateral Reporting. Provide Agent with each of the reports set forth on Schedule 5.2 at the times specified therein. In addition, Borrower agrees to use commercially reasonable efforts in cooperation with Agent to maintain a system of electronic collateral reporting in order to provide electronic reporting of each of the items set forth on such Schedule.

5.3 Existence. Except as otherwise permitted under Section 6.3 or Section 6.4, with respect to each Loan Party at all times maintain and preserve in full force and effect its existence (including being in good standing in its jurisdiction of organization) and all rights and franchises, licenses and permits granted by Governmental Authorities that are necessary in the normal conduct of its business; provided, however, that no Loan Party shall be required to preserve any such right or franchise, licenses or permits if such Person’s board of directors (or similar governing body) shall determine that the preservation thereof is no longer desirable in the conduct of the business of such Person, or that the loss thereof could not reasonably be expected to result in a Material Adverse Change.

5.4 Maintenance of Properties. Maintain and preserve all of its material tangible assets that are necessary and useful in the proper conduct of its business in good working order and condition, ordinary wear, tear, and casualty and condemnation excepted and Permitted Dispositions excepted, except where the failure to do so could not reasonably be expected to result in a Material Adverse Change.

5.5 Taxes. Cause all material assessments and taxes imposed, levied, or assessed against any Loan Party or its Subsidiaries, or any of their respective assets or in respect of any of its income, businesses, or franchises to be paid in full, before delinquency or before the expiration of any extension period, except to the extent that the validity of such assessment or tax

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shall be the subject of a Permitted Protest and so long as, in the case of an assessment or tax that has or may become a Lien against any of the Collateral, such contest proceedings conclusively operate to stay the sale of any portion of the Collateral to satisfy such assessment or tax. Parent will and will cause each of its Subsidiaries to make timely payment or deposit of all material tax payments and withholding taxes required of it and them by applicable laws.

5.6 Insurance. At Borrower’s expense, maintain insurance respecting each of the Loan Parties’ and their Subsidiaries’ assets, covering loss or damage by fire, theft, explosion, and such other hazards and risks as ordinarily are insured against by other Persons engaged in the same or similar businesses; provided that in the case of Vessels, the Vessels shall be insured in accordance with the Vessel Fleet Mortgage and each of the arrangements pursuant to which the Vessel is chartered or operated by the Loan Parties as set forth in Schedule 4.28. Borrower also shall maintain (with respect to each of the Loan Parties and their Subsidiaries) business interruption, general liability, and flood insurance with respect to any Real Property Collateral in a flood plain. All such policies of insurance shall be with financially sound and reputable insurance companies having a “Best” rating of B+ or better and in such amounts and scope as is carried generally in accordance with sound business practice by companies in similar businesses similarly situated and located and in any event reasonably satisfactory to Agent, it being understood that the amounts and scope set forth in the certificates provided on the Closing Date are satisfactory. Subject to the terms of the Intercreditor Agreement, all property insurance policies covering the Collateral are to be made payable to Agent for the benefit of Agent and the Lenders, as their interests may appear, in case of loss, pursuant to a standard loss payable endorsement with a standard non contributory “lender” or “secured party” clause and are to contain such other provisions as Agent may reasonably require to fully protect the Lenders’ interest in the Collateral and to any payments to be made under such policies. All certificates of property and general liability insurance are to be delivered to Agent, with the loss payable (but only in respect of Collateral) and additional insured endorsements in favor of Agent and shall provide for not less than 30 days (10 days in the case of non-payment) prior written notice to Agent of the exercise of any right of cancellation. If Borrower fails to maintain such insurance, Agent may, after providing written notice to the Borrower, arrange for such insurance, but at Borrower’s expense and without any responsibility on Agent’s part for obtaining the insurance, the solvency of the insurance companies, the adequacy of the coverage, or the collection of claims. Borrower shall give Agent prompt notice of any loss exceeding $2,500,000 covered by its casualty or business interruption insurance. Upon the occurrence and during the continuance of an Event of Default, subject to the terms of the Intercreditor Agreement, Agent shall have the sole right to file claims under any property and general liability insurance policies in respect of the Collateral, to receive, receipt and give acquittance for any payments that may be payable thereunder, and to execute any and all endorsements, receipts, releases, assignments, reassignments or other documents that may be necessary to effect the collection, compromise or settlement of any claims under any such insurance policies.

5.7 Inspection. Keep proper books of record and accounts in which full, true and correct entries which permit the preparation of financial statements in accordance with GAAP and which conform to all Requirements of Law, shall be made of all material dealings and transactions in relation to its business and activities. During regular business hours and, so long as no Event of Default exists, upon reasonable notice to Borrower, Borrower shall permit Agent and each of its duly authorized representatives or agents to visit any of its properties and inspect

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any of its assets or books and records, to conduct appraisals and valuations, to examine and make copies of its books and records, and to discuss its affairs, finances, and accounts with, and to be advised as to the same by, its officers and employees at mutually convenient times and reasonable intervals; provided that the Borrower (or any other Loan Party) shall not be obligated to reimburse for more than 2 audits and 1 appraisal during any calendar year; provided, further, that (i) the total number of reimbursable audits shall be increased by 1 in any 12 month period during a Trigger Event and (ii) upon the occurrence and during the continuance of an Event of Default, there shall be no limit on the number of audits which may be conducted by the Agent, each at the expense of the Borrower. Notwithstanding anything in this Section 5.7 to the contrary, none of the Loan Parties or any of their officers or employees will be required to disclose, permit the inspection, examination or making copies or abstracts of, or discussion of, any document, information or other matter (i) in respect of which disclosure to the Agent ( or its representatives or agents) is prohibited by applicable law or binding agreement or (ii) that is subject to attorney-client privilege or constitutes attorney work product.

5.8 Compliance with Laws. Comply with the requirements of all applicable laws, rules, regulations, and orders of any Governmental Authority, except to the extent non-compliance with such applicable laws, rules, regulations, and orders, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Change.

5.9 Environmental.

(a) Keep any property either owned or operated by Parent or its Subsidiaries free of any Environmental Liens or post bonds or other financial assurances sufficient to satisfy the obligations or liability evidenced by such Environmental Liens,

(b) Comply with Environmental Laws except where the failure to do so could not reasonably be expected to result in a Material Adverse Change,

(c) Promptly notify Agent of any release of a Hazardous Material in any reportable quantity from or onto property owned or operated by a Loan Party and take any Remedial Actions required to abate said release or otherwise to come into compliance with applicable Environmental Law except where the failure to do so could not reasonably be expected to result in a Material Adverse Change, and

(d) Promptly, but in any event within 5 Business Days of its receipt thereof, provide Agent with written notice of any of the following: (i) notice that an Environmental Lien has been filed against any of the real or personal property of any Loan Party and (ii) commencement of any Environmental Action.

5.10 Disclosure Updates. Promptly and in no event later than 5 Business Days after obtaining knowledge thereof, notify Agent if any written information, exhibit, or report (other than projections, forward looking statements and information of a general economic nature and general information about Borrower’s industry) furnished to Agent or the Lender Group contained, at the time it was furnished, any untrue statement of a material fact or omitted to state any material fact necessary to make the statements contained therein (taken as a whole) not misleading in light of the circumstances in which made (it being understood that with respect to

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projections and other forward-looking statements, the same are subject to the proviso in the last sentence of Section 4.16). The foregoing to the contrary notwithstanding, any notification pursuant to the foregoing provision will not cure or remedy the effect of the prior untrue statement of a material fact or omission of any material fact nor shall any such notification have the effect of amending or modifying this Agreement or any of the Schedules hereto.

5.11 Formation of Subsidiaries, Etc. At the time that (x) any Person becomes (whether by acquisition, formation or otherwise) a direct or indirect Subsidiary (other than any Foreign Subsidiary, any direct or indirect Subsidiary of a Foreign Subsidiary or an Immaterial Subsidiary) of a Loan Party, (y) any Immaterial Subsidiary ceases to be an Immaterial Subsidiary (but is otherwise still a direct or indirect Domestic Subsidiary of a Loan Party and not a direct or indirect Subsidiary of a Foreign Subsidiary) or (z) any Subsidiary of a Loan Party that is not a Guarantor guarantees the Secured Notes, any Additional Notes, any Permitted Additional Pari Passu Obligations, and the Vessel Financing Debt (and any Refinancing Indebtedness in respect of the foregoing), such Loan Party shall:

(a) within 30 days thereof (or such later date as permitted by Agent in its sole discretion), (i) notify Agent thereof (and, notwithstanding the parenthetical in clause (x) above, the existence of any Person that becomes a Foreign Subsidiary or an Immaterial Subsidiary) and (ii) cause any Subsidiary described in clauses (x), (y) or (z) above to provide to Agent a joinder (or such other supplements) to the Guaranty and the Security Agreement, together with such other security documents (including (A) upon request of Agent, Mortgages with respect to any Real Property owned in full by such Subsidiary having a fair market value in excess of $1,000,000, (B) Vessel Fleet Mortgages with respect to any Vessel owned by such Subsidiary except to the extent a mortgage in favor of Agent is prohibited as a result of a permitted mortgage in favor of the Maritime Administration in connection with a U.S. Government-guaranteed financing transaction under 46 U.S.C. Chapter 537, and (C) certificates of title with respect to Chassis) as well as appropriate financing statements, all in form and substance reasonably satisfactory to Agent and otherwise consistent with other then existing Loan Documents (including being sufficient to grant Agent a first priority Lien in and upon the ABL Priority Collateral and, in the case of Secured Notes Priority Collateral, Liens with the priority set forth in the Intercreditor Agreement (subject, in each case, only to Permitted Liens and the relative priorities thereof));

(b) within 30 days thereof (or such later date as permitted by Agent in its sole discretion), provide to Agent a pledge agreement (or an addendum to the Security Agreement) and deliver appropriate Stock certificates and powers or financing statements, pledging all of the direct or beneficial ownership interest in such Subsidiary reasonably satisfactory to Agent; provided that no more than 65% of the total outstanding voting Stock (and 100% of the total outstanding non-voting Stock) of any first-tier Foreign Subsidiary of any Loan Party (and none of the Stock of any Subsidiary of a Foreign Subsidiary) shall be required to be pledged under the Loan Documents;

(c) within 30 days thereof (or such later date as permitted by Agent in its sole discretion), provide to Agent all other documentation, including one or more opinions of counsel reasonably satisfactory to Agent, which in its opinion is appropriate with respect to the execution and delivery of the applicable documentation referred to above (including policies of title

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insurance or other documentation with respect to such Real Property owned in fee and subject to a mortgage, such Vessels subject to Vessel Fleet Mortgages and such Chassis for which certificates of title have been so delivered). Any document, agreement, or instrument executed or issued pursuant to this Section 5.11 shall be a Loan Document;

(d) Notwithstanding anything to the contrary in this Agreement or any other Loan Document, so long as the Secured Notes or any Permitted Additional Pari Passu Obligations (or Refinancing Indebtedness in respect of the foregoing) are outstanding, the actions and deliverables required by this Section 5.11 with respect to Agent’s security interest in any Secured Notes Priority Collateral (including (i) the Stock in or of such Subsidiary, (ii) Mortgages with respect to any Real Property owned in fee of a Loan Party, which shall only be delivered to Agent upon its request therefor, (iii) Vessel Fleet Mortgages with respect to any Vessel owned by such Subsidiary and (iv) Chassis subject to certificates of title statues owned by such Subsidiary) shall be subject to the terms of the Intercreditor Agreement and required only to the extent required under the Secured Notes Documents, including the documentation required to evidence the Agent’s security interest and the timing of delivery with respect thereto.

5.12 Further Assurances. At any time upon the reasonable request of Agent, execute or deliver to Agent any and all financing statements, fixture filings, security agreements, pledges, assignments, endorsements of certificates of title, mortgages, vessel mortgages, deeds of trust, opinions of counsel, and all other documents (the “Additional Documents”) that Agent may reasonably request in form and substance reasonably satisfactory to Agent, to create, perfect, and continue perfected or to better perfect Agent’s Liens (to the extent required under the Loan Documents) in substantially all assets of the Loan Parties (other than Immaterial Subsidiaries) (whether now owned or hereafter arising or acquired, tangible or intangible, real or personal, but excluding Excluded Assets), to create and perfect Liens in favor of Agent in any Real Property acquired by the Loan Parties after the Closing Date with a fair market value in excess of $1,000,000 and any Vessels acquired by the Loan Parties after the Closing Date (except to the extent a mortgage in favor of Agent is prohibited as a result of a permitted mortgage in favor of the Maritime Administration in connection with a U.S. Government-guaranteed financing transaction under 46 U.S.C. Chapter 537), and in order to fully consummate all of the transactions contemplated hereby and under the other Loan Documents; provided that (a) the foregoing shall not apply to any Foreign Subsidiary of Parent or any Immaterial Subsidiary and (b) Mortgages with respect to Real Property shall only be delivered upon request of Agent. To the maximum extent permitted by applicable law, if Parent refuses or fails to execute or deliver any reasonably requested Additional Documents within a reasonable period of time following the request to do so, Parent hereby authorizes Agent to execute any such Additional Documents in the applicable Loan Party’s or its Subsidiary’s name, as applicable, and authorizes Agent to file such executed Additional Documents in any appropriate filing office. In furtherance and not in limitation of the foregoing, each Loan Party shall take such actions as Agent may reasonably request from time to time to ensure that the Obligations are guaranteed by the Guarantors and are secured, to the extent required under the Loan Documents, by first priority Lien in and upon the ABL Priority Collateral and, in the case of Secured Notes Priority Collateral, the Lien priority set forth in the Intercreditor Agreement (subject, in each case, only to Permitted Liens and the relative priorities thereof).

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Notwithstanding anything to the contrary in this Agreement or any other Loan Document, so long as the Secured Notes or any Permitted Additional Pari Passu Obligations (or Refinancing Indebtedness in respect of the foregoing) are outstanding, the further assurances required to be taken in this Section 5.12 with respect to Agent’s security interest in any Secured Notes Priority Collateral (including (A) the Stock in or of a Subsidiary of a Loan Party, (B) Mortgages with respect to any Real Property owned in fee of a Loan Party, which shall only be delivered to Agent upon its request therefor, (C) Vessel Fleet Mortgages with respect to any Vessel owned by a Loan Party and (D) Chassis subject to certificates of title statues owned by a Loan Party) shall be subject to the terms of the Intercreditor Agreement and required only to the extent required under the Secured Notes Documents, including the documentation required to evidence the Agent’s security interest and the timing of delivery with respect thereto.

5.13 Lender Meetings. Within 120 days after the close of each fiscal year of Parent, at the request of Agent or of the Required Lenders and upon reasonable prior notice, hold a meeting (at a time mutually agreeable and by meeting or phone, as mutually agreed, by Agent and Parent) with all Lenders who choose to attend such meeting at which meeting shall be reviewed the financial results of the previous fiscal year and the financial condition of Parent and its Subsidiaries and the projections presented for the current fiscal year of Parent.

5.14 Material Contracts. Concurrently with the filing of Parent’s quarterly financial statements with the SEC, deliver a list of any Material Contracts entered into by a Loan Party since the making of the previous quarterly filings. Promptly notify Agent (a) if any Material Contract is terminated other than in accordance with its terms or (b) of a material default thereunder, except, in each case of the foregoing clauses (a) and (b), as could not reasonably be expected to result, individually or in the aggregate, in a Material Adverse Change. Upon request from Agent, provide Agent with copies of each Material Contract entered into, except to the extent not permitted to be disclosed pursuant to confidentiality obligations.

5.15 Location of Books and Records. Keep each Loan Parties’ books and records pertaining to the ABL Priority Collateral only at the locations identified on Schedule 4.26 and their chief executive offices only at the locations identified on Schedule 4.6(b); provided, however, that Borrower may amend Schedule 4.26 or Schedule 4.6(b) so long as such amendment occurs by written notice to Agent not less than 10 days prior to the date on which such books and records are moved to such new location or such chief executive office is relocated and so long as such new location is within the continental United States, and so long as, at the time of such written notification, Borrower shall use commercially reasonable efforts to provide Agent a Collateral Access Agreement with respect to locations where such books and records are located.

5.16 Compliance with ERISA. In addition to and without limiting the generality of Section 5.8, (a) except where the failure to so comply could not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Change, (i) comply with applicable provisions of ERISA, the IRC and the regulations and published interpretations thereunder with respect to all Employee Benefit Plans (other than Multiemployer Plans), (ii) not take any action or fail to take action the result of which could reasonably be expected to result in a liability to the PBGC or to a Multiemployer Plan, (iii) not participate in any non-exempt prohibited transaction with respect to any Employee Benefit Plan that could result in any civil penalty under ERISA or

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tax under the IRC and (iv) operate each Employee Benefit Plan (other than Multiemployer Plans) in such a manner that will not incur any tax liability under Section 4980B of the IRC or any liability to any qualified beneficiary as defined in Section 4980B of the IRC and (b) furnish to Agent upon Agent’s request such additional information about any Employee Benefit Plan as may be reasonably requested by Agent.

5.17 Jones Act Trade. With respect to each Loan Party that owns or operates vessels in the coastwise trade of the United States, to remain a “citizen of the United States” within the meaning of 46 U.S.C. § 50501(a) and (d), eligible to own and operate vessels in the coastwise trade of the United States.

5.18 Judgment Liens. Take all actions necessary to satisfy the terms of the Antitrust Judgment Lien and the Vessel Environmental Judgment Lien, including the making of all payments due in respect thereof on or before the respective dates such payments are due and payable as stipulated in the Antitrust Judgment or the Vessel Environmental Judgment, as applicable. Promptly, after the making of each such payment, Parent shall confirm to Agent that such payment has been made.

6. NEGATIVE COVENANTS.

Each of Parent and Borrower covenants and agrees that, until termination of all of the Revolver Commitments and payment in full of the Obligations (other than Contingent Obligations), the Loan Parties will not and will not permit any of their Subsidiaries to do any of the following:

6.1 Indebtedness. Create, incur, assume, suffer to exist, guarantee, or otherwise become or remain, liable with respect to any Indebtedness, except for Permitted Indebtedness.

6.2 Liens. Create, incur, assume, or suffer to exist, any Lien on or with respect to any of its assets, of any kind, whether now owned or hereafter acquired, or any income or profits therefrom, except for Permitted Liens.

6.3 Restrictions on Fundamental Changes.

(a) Other than in order to consummate a Permitted Acquisition, enter into any merger or consolidation, except for (i) any merger or consolidation between Loan Parties, provided that Borrower must be the surviving entity of any such merger to which it is a party and no merger may occur between Parent and Borrower, (ii) any merger between a Loan Party and Subsidiaries of such Loan Party that are not Loan Parties so long as such Loan Party is the surviving entity of any such merger, and (iii) any merger between Subsidiaries of Parent that are not Loan Parties,

(b) Liquidate, wind up, or dissolve itself (or suffer any liquidation or dissolution), except for (i) the liquidation or dissolution of Immaterial Subsidiaries of Borrower, (ii) the liquidation or dissolution of a Loan Party (other than Parent or Borrower) or any of its wholly-owned Subsidiaries so long as all of the assets (including any interest in any Stock) of such liquidating or dissolving Loan Party or Subsidiary are transferred to a Loan Party (or in the case of a Subsidiary that is not a Loan Party, to any other Subsidiary of Parent) that is not

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liquidating or dissolving at such time, or (iii) the liquidation or dissolution of a Subsidiary of Parent that is not a Loan Party (except that in the case of any such Subsidiary the Stock of which (or any portion thereof) is subject to a Lien in favor of Agent, such liquidation or dissolution shall only be permitted to the extent such Stock is transferred to a Loan Party or cancelled) so long as all of the assets of such liquidating or dissolving Subsidiary are transferred to a Subsidiary of Parent that is not liquidating or dissolving; provided that for the avoidance of doubt, nothing in this Section 6.3 shall be construed to prohibit or restrict the Non-Domestic Reorganization.

6.4 Disposal of Assets. Other than Permitted Dispositions or transactions expressly permitted by Sections 6.3 or 6.11, convey, sell, lease, license, assign, transfer, or otherwise dispose of (or enter into an agreement to convey, sell, lease, license, assign, transfer, or otherwise dispose of) any of Parent’s or its Subsidiaries assets.

6.5 Change Name. Change Parent’s or any other Loan Party’s name, organizational identification number, state of organization or organizational identity; provided, however, that Parent or any other Loan Party may change its name, organizational identification number, state of organization or organizational identity upon at least 10 Business Days’ prior written notice (or such later date as Agent may agree in its sole discretion) to Agent of such change.

6.6 Nature of Business. Make any change in the nature of their business (taken as a whole) as described in Schedule 6.6; provided, however, that the foregoing shall not prohibit Parent and its Subsidiaries from: (a) engaging in any business that is reasonably related or ancillary to its or their business, (b) making any Permitted Disposition or Permitted Investments, (c) consummating any other transactions permitted under Section 6.3 or 6.11, or (d) consummating the Non-Domestic Reorganization.

6.7 Prepayments and Amendments.

(a) Restricted Debt Payments. Make any Restricted Debt Payments except for Permitted Restricted Debt Payments.

(b) Amendments. Amend, modify, or change any of the terms or provisions of:

(i) the Senior Notes, except to the extent that such amendment, modification or change could not, individually or in the aggregate, reasonably be expected to be materially adverse to the interests of the Lenders; provided that in any event the following amendments, modifications or changes shall be permitted: (x) increases in the interest rate on such Secured Notes by not more than 2.00% per annum, (y) changes that eliminate or waive (or otherwise make less restrictive on Parent and its Subsidiaries) any covenant, representation, condition or event of default, or increase any grace period related thereto and (z) amendments, modifications or changes in accordance with clause (p) of the definition of Permitted Indebtedness;

(ii) any Material Contract except to the extent that such amendment, modification, or change could not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Change; and

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(iii) the Governing Documents of any Loan Party or any of its Subsidiaries if the effect thereof, either individually or in the aggregate, could reasonably be expected to be materially adverse to the interests of the Lenders.

6.8 Change of Control. Cause, permit, or suffer, directly or indirectly, any Change of Control.

6.9 Restricted Stock Payments. Make any Restricted Stock Payment; provided, however, that, so long as it is permitted by law, and so long as no Default or Event of Default shall have occurred and be continuing or would result therefrom, Parent and its Subsidiaries may make, Permitted Restricted Stock Payments.

6.10 Accounting Methods. Modify or change its fiscal year or its method of accounting (other than as may be required to conform to GAAP) without the prior consent of Agent not to be unreasonably withheld, conditioned or delayed.

6.11 Investments; Controlled Investments.

(a) Investments. Make or acquire any Investment or incur any liabilities (including contingent obligations) for or in connection with any Investment, except for Permitted Investments.

(b) Controlled Investments. Subject to Section 3.6 with respect to Deposit Accounts and Securities Accounts existing on the Closing Date, Parent shall not, and shall not permit its Subsidiaries, to establish or maintain any Deposit Account or Securities Account (other than Excluded Accounts) unless Agent shall have received a Control Agreement in respect of such Deposit Account or Securities Account.

6.12 Transactions with Affiliates. Enter into or permit to exist any transaction with any Affiliate of Parent or any of its Subsidiaries except for:

(a) transactions (other than the payment of management, consulting, monitoring, or advisory fees) between Parent or its Subsidiaries, on the one hand, and any Affiliate of Parent or its Subsidiaries, on the other hand, so long as such transactions (i) are fully disclosed to Agent prior to the consummation thereof, if they involve one or more payments by Parent or its Subsidiaries in excess of $2,500,000 for any single transaction or series of related transactions, and (ii) are no less favorable, taken as a whole, to Parent or its Subsidiaries, as applicable, than would be obtained in an arm’s length transaction with a non-Affiliate,

(b) so long as it has been approved by Parent’s or its applicable Subsidiary’s board of directors (or comparable governing body) in accordance with applicable law, any indemnity provided for the benefit of directors (or comparable managers) of Parent or its applicable Subsidiary,

(c) so long as it has been approved by Parent’s or its applicable Subsidiary’s board of directors (or comparable governing body) in accordance with applicable law, the payment of reasonable compensation, severance, or employee benefit arrangements to employees, officers, and outside directors of Parent and its Subsidiaries in the ordinary course of business,

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(d) transactions permitted by Section 6.3, Section 6.7(a) or Section 6.9, or any Permitted Intercompany Investment,

(e) transactions between any Loan Parties, and/or between Subsidiaries thereof that are not Loan Parties,

(f) any agreement, instrument or arrangement as in effect on the Closing Date and identified on Schedule 6.12 or any amendment thereto (so long as such amendment is not materially more disadvantageous taken as a whole, than the applicable agreement, instrument or arrangement, as in effect on the date of the Closing Date),

(g) loans or advances to employees of any Loan Party or its Subsidiaries in the ordinary course of business and permitted by Section 6.11,

(h) payment of reasonable fees and reimbursement of expenses of directors of any Loan Party, and

(i) the Transactions.

6.13 Use of Proceeds. Use the proceeds of any loan made hereunder for any purpose other than (a) together with the proceeds of the Secured Notes (First Lien) and Secured Notes (Second Lien), to refinance certain existing Indebtedness of Parent (including Indebtedness incurred pursuant to the Existing Credit Agreement), (b) to fund certain fees, costs and expenses associated with Transactions, and (c) to finance the ongoing general corporate and working capital needs of Borrower, the other Loan Parties and, to extent expressly permitted hereunder, their Subsidiaries; including any Permitted Acquisition; provided that no part of the proceeds of the loans made to Borrower will be used to purchase or carry any such Margin Stock or to extend credit to others for the purpose of purchasing or carrying any such margin stock or for any purpose that violates the provisions of Regulation T, U or X of the Board of Governors of the United States Federal Reserve).

6.14 Limitation on Issuance of Stock. Issue or sell or enter into any agreement or arrangement for the issuance and sale of any of its Stock, except for the issuance or sale of (a) common Stock (including options, warrants, interests, participations or other equivalents relating thereto), (b) Permitted Preferred Stock by Parent (including options, warrants, interests, participations or other equivalents relating thereto), (c) instruments representing rights to issue common Stock of Parent in exchange for any Secured Notes (Convertible) in accordance with the terms of the Secured Notes Documents (Convertible), (d) Stock of a Loan Party to another Loan Party, (e) Stock of a Non-Loan Party to another Non-Loan Party, (f) Stock of a Non-Loan Party to a Loan Party so long as the acquisition of such Stock by a Loan Party constitutes a Permitted Investment, or (g) any warrants or options to acquire common Stock issued to ensure compliance by any Loan Party of its agreement to be and remain a “citizen of the United States” within the meaning of 46 U.S.C. § 50501(a) and (d).

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6.15 Restrictions Affecting Subsidiaries. Create or otherwise permit to exist any encumbrance or restriction (other than pursuant to this Agreement or any other Loan Document) that (a) limits the ability (i) of any Subsidiary to make dividends or distributions to a Loan Party or to otherwise transfer property to or invest in a Loan Party, (ii) of any Subsidiary to make loans or advances to any Loan party or to pay any Indebtedness owed to a Loan Party, (iii) of any Subsidiary to guarantee the Indebtedness of Borrower or (iv) of any Loan Party to create, incur, assume or suffer to exist Liens on property of such Loan Party, 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 the foregoing shall not apply to encumbrances or restrictions which (A) are customary provisions in joint venture agreements and other similar agreements applicable to joint ventures permitted under Section 6.11 and applicable solely to such joint venture entered into in the ordinary course of business, (B) are customary restrictions on leases, subleases, licenses or sublicenses otherwise permitted hereunder so long as such restrictions relate solely to the assets subject thereto, (C) are customary anti-assignment provisions in contracts restricting the assignment of any agreement entered into in the ordinary course of business, (D) are customary restrictions in contracts for the disposition of any assets permitted by Section 6.4, provided that the restrictions in any such contracts shall apply only to such assets that is to be disposed of, (E) are customary provisions in leases of Real Property that prohibit mortgages or pledges of the lessee’s interest under such lease, (F) are contained in any Acquired Indebtedness not created in anticipation thereof, (G) are contained in the Secured Notes Documents and any Refinancing Indebtedness incurred in respect thereof, (H) are customary restrictions on Liens in the terms of any Indebtedness for which Liens are permitted under clause (f) of the definition of Permitted Liens if such restriction applies only to the property financed by or the subject of such Indebtedness, (I) arise under applicable law, (J) result from agreements in effect on the Closing Date and, if of a material nature, disclosed to Agent, and any amendments, restatements, modifications, renewals, supplements, refundings, replacements or refinancings of such agreements; provided that the amendments, restatements, modifications, renewals, supplements refundings, replacements or refinancings are not materially more restrictive with respect to such dividend and other payment restrictions than those contained in those agreements on the Closing Date, (K) result from any agreement for the sale or other disposition of the equity Stock or assets of a Person permitted by this Agreement that restricts distributions by that Person pending such sale or other disposition, (L) pursuant to Refinancing Indebtedness; provided that the restrictions contained in the agreements governing such Refinancing Indebtedness are not materially more restrictive, taken as a whole, than those contained in the agreements governing the Indebtedness being refinanced, extended, renewed, refunded, replaced, defeased or discharged, (M) restrictions on cash or other deposits or net worth imposed by customers under contracts or other agreements entered into in the ordinary course of business, (N) encumbrances on property permitted by this Agreement that exist at the time such property was acquired by the Loan Parties or their Subsidiaries or (O) restrictions or conditions contained in any trading, netting, operating, construction, service, supply, purchase or other similar agreement permitted by this Agreement to which a Loan Party or any of its Subsidiaries is a party entered into in the ordinary course of business; provided that such agreement prohibits the encumbrance of solely the property or assets of such Person that are the subject of such agreement, the payment rights arising thereunder or the proceeds thereof and does not extend to any other asset or property of such Person.

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7. FIXED CHARGE COVERAGE RATIO.

Each of Parent and Borrower covenants and agrees that, until termination of all of the Revolver Commitments and payment in full of the Obligations (other than Contingent Obligations), during a Trigger Period, Parent shall maintain, on a consolidated basis, as of the last day of each fiscal month commencing with the last day of the most recent fiscal month immediately preceding the commencement of a Trigger Period for which financial information is available and ending on the expiration of such Trigger Period, a Fixed Charge Coverage Ratio of at least 1.00 to 1.00 (computed for the 12 month period then ending).

8. EVENTS OF DEFAULT.

Any one or more of the following events shall constitute an event of default (each, an “Event of Default”) under this Agreement:

8.1 Payment Default. If Borrower fails to pay when due and payable in accordance with the terms hereof (whether at maturity, by reason of acceleration or otherwise), (a) all or any portion of the Obligations (other than Bank Product Obligations) consisting of interest, fees, or charges due the Lender Group, reimbursement of Lender Group Expenses, or other amounts (other than any portion thereof constituting principal) constituting Obligations (other than Bank Product Obligations), and such failure continues for a period of 3 Business Days, or (b) all or any portion of the principal of the Obligations (other than Bank Product Obligations).

8.2 Covenant Default. If any Loan Party:

(a) fails to perform or observe any covenant or other agreement contained in any of (i) Sections 3.6, 5.1, 5.2, 5.3 (solely if Borrower is not in good standing in its jurisdiction of organization), 5.7 (solely if Borrower refuses to allow Agent or its representatives or agents to visit Borrower’s properties, inspect its assets or books or records, examine and make copies of its books and records, or discuss Borrower’s affairs, finances, and accounts with officers and employees of Borrower), 5.10, 5.11, 5.13, 5.15 or 5.17 of this Agreement, (ii) Sections 6.1 through 6.15 of this Agreement, (iii) Section 7 of this Agreement, or (iv) Section 6(k) of the Security Agreement;

(b) fails to perform or observe any covenant or other agreement contained in Section 5.18 of this Agreement and such failure continues for a period of 3 Business Days;

(c) fails to perform or observe any covenant or other agreement contained in any of Sections 5.3 (other than if Borrower is not in good standing in its jurisdiction of organization), 5.4, 5.5, 5.6, 5.8, 5.12 or 5.14 of this Agreement and such failure continues for a period of 10 days after the earlier of (i) the date on which such failure shall first become known to any officer of Borrower or (ii) the date on which written notice thereof is given to Borrower by Agent; or

(d) fails to perform or observe any covenant or other agreement contained in this Agreement, or in any of the other Loan Documents, in each case, other than any such covenant or agreement that is the subject of another provision of this Section 8 (in which event such other provision of this Section 8 shall govern), and such failure continues for a period of 30 days after the earlier of (i) the date on which such failure shall first become known to any officer of Borrower or (ii) the date on which written notice thereof is given to Borrower by Agent.

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8.3 Judgments. After the Closing Date, if one or more judgments, orders, or awards for the payment of money involving an aggregate amount of $10,000,000, or more (except for (a) the Vessel Environmental Judgment and (b) to the extent (i) fully covered (other than to the extent of customary deductibles) by insurance pursuant to which the insurer has not denied coverage or (ii) fully covered by one or more unsecured settlements or plea agreements providing for annual aggregate payments of not more than (A) for calendar years 2011 and 2012, $15,000,000, (B) for calendar year 2013, $12,500,000 and (C) for calendar year 2014 and each calendar year thereafter, $10,000,000) is entered or filed against a Loan Party or any of its Subsidiaries, or with respect to any of their respective assets, and either (I) there is a period of 60 consecutive days at any time after the entry of any such judgment, order, or award during which (x) the same is not discharged, satisfied, vacated, or bonded pending appeal, or (y) a stay of enforcement thereof is not in effect, or (II) enforcement proceedings are commenced upon such judgment, order, or award.

8.4 Voluntary Insolvency Proceeding. If any Loan Party or any Subsidiary thereof (other than any Immaterial Subsidiary) shall (a) commence an Insolvency Proceeding, (b) admit in writing its inability to pay its debts as they become due, or (c) take any corporate action for the purpose of authorizing any of the foregoing.

8.5 Involuntary Insolvency Proceeding. If an Insolvency Proceeding is commenced against a Loan Party or any of its Subsidiaries (other than any Immaterial Subsidiary) and any of the following events occur: (a) such Loan Party or such Subsidiary consents to the institution of such Insolvency Proceeding against it, (b) the petition commencing the Insolvency Proceeding is not timely controverted, (c) the petition commencing the Insolvency Proceeding is not dismissed within 60 calendar days of the date of the filing thereof, (d) an interim trustee is appointed to take possession of all or any substantial portion of the properties or assets of, or to operate all or any substantial portion of the business of, such Loan Party or its Subsidiary, or (e) an order for relief shall have been issued or entered therein.

8.6 Restriction on Business. If a Loan Party is enjoined, restrained, or in any way prevented by court order from continuing to conduct all or any material part of the business affairs of Parent and its Subsidiaries, taken as a whole, in such a manner as results in, or could reasonably be expected to result in, a Material Adverse Change.

8.7 Cross Default.

(a) If any Loan Party or any Subsidiary thereof shall (i) default in respect of any Secured Notes or any Additional Notes and such default results in an “Event of Default” (or the equivalent term) under, and as defined in, the Secured Notes Documents or the documents evidencing the Additional Notes, (ii) default in the payment of any Bank Product Obligations (other than Hedging Obligations) beyond the period of grace, if any, provided in the instrument or agreement under which such obligations were created, (iii) default in the payment of any Indebtedness (other than (x) the Obligations and (y) obligations under any Hedge Agreements, the Secured Notes or the Additional Notes) the aggregate outstanding amount of which

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Indebtedness is in excess of $10,000,000 beyond the period of grace if any, provided in the instrument or agreement under which such Indebtedness was created, or (iv) default in the observance or performance of any other agreement or condition relating to any Indebtedness (other than (x) the Obligations and (y) obligations under any Hedge Agreements) the aggregate outstanding amount of which Indebtedness is in excess of $10,000,000 or contained in any instrument or agreement evidencing, securing or relating thereto or any other event shall occur or condition exist, the effect of which default or other event or condition is to cause, or to permit the holder or holders of such Indebtedness (or a trustee or agent on behalf of such holder or holders) to cause, with the giving of notice and/or lapse of time, any such Indebtedness to become due prior to its stated maturity (any applicable grace period having expired), including, without limitation, pursuant to any “put”, or mandatory tender, redemption or repurchase of such Indebtedness.

(b) If there is an involuntary “early termination event” or other similar event (which event shall extend beyond any applicable cure periods or grace periods) shall have occurred in respect of obligations owing under any Hedge Agreement of a Loan Party, and the amount of such obligations, either individually or in the aggregate for all such Hedge Agreements, is in excess of $10,000,000; provided that, in respect of obligations owing under any Hedge Agreement of such Loan Party owed to the applicable counterparty at such time, the amount for purposes of this Section 8.7(b) shall be the amount payable on a net basis by such Loan Party to such counterparty if such Hedge Agreement were terminated at such time).

8.8 Misrepresentation. If any warranty, representation, certificate, statement, or Record made herein or in any other Loan Document or delivered in writing to Agent or any Lender in connection with this Agreement or any other Loan Document proves to be untrue in any material respect (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof) as of the date of issuance or making or deemed making thereof.

8.9 Failure of Guaranty. If the obligation of any Guarantor under the Guaranty is limited or terminated by operation of law or by such Guarantor (other than in accordance with the terms of this Agreement or any other Loan Document).

8.10 Failure of other Loan Documents. If the Security Agreement or any other Loan Document that purports to create a Lien, shall, for any reason, fail or cease to create a valid and perfected (to the extent required under the Loan Documents) and, except to the extent of Permitted Liens which are permitted tax Liens, the Antitrust Judgment Lien or the Vessel Environmental Judgment Lien, first priority Lien in and upon the ABL Priority Collateral and, in the case of Secured Notes Priority Collateral, the Lien priority set forth in the Intercreditor Agreement, except (a) as a result of a disposition of the applicable Collateral permitted under this Agreement or (b) as the result of an action or failure to act on the part of Agent.

8.11 Invalidity of Loan Documents. The validity or enforceability of any Loan Document shall at any time for any reason (other than solely as the result of an action or failure to act on the part of Agent) be declared to be null and void, or a proceeding shall be commenced by a Loan Party, or by any Governmental Authority having jurisdiction over a Loan Party, seeking to establish the invalidity or unenforceability thereof, or a Loan Party shall deny that such Loan Party has any liability or obligation purported to be created under any Loan Document.

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8.12 ERISA Events. The occurrence of any of the following events which reasonably could be expected to result in a Material Adverse Change: (i) any Loan Party or any ERISA Affiliate fails to make full payment when due of all amounts which, under the provisions of any Pension Plan or Sections 412 or 430 of the IRC, any Loan Party or any ERISA Affiliate is required to pay as contributions thereto or (ii) a Termination Event.

8.13 Designation as Senior Indebtedness. If (a) the Obligations shall at any time fail to constitute “Senior Indebtedness”, “Designated Senior Indebtedness” or any similar designation under and as defined in any agreement or instrument governing any Indebtedness that is subordinated to the Obligations, (b) the subordination provisions of any agreement or instrument governing any Indebtedness in a principal amount in excess of $2,500,000 that is subordinated to the Obligations shall for any reason (other than as a result of any action or inaction of Agent or any Lender) be revoked or invalidated, or otherwise cease to be in full force and effect, unless such Indebtedness would otherwise be permitted to be incurred as “Senior Indebtedness” at such time (and for purposes of any baskets, shall be deemed to be incurred as such), or any Loan Party shall contest in any manner the validity or enforceability thereof, or (c) any Indebtedness other than the Indebtedness evidenced by this Agreement and/or Bank Product Obligations shall be designated as an “ABL Facility” or a “ Credit Facility” or any similar designation under and as defined in the Secured Notes.

8.14 Chartered Vessel Document Default. Except to the extent a result of a buy-out, buy-down, the Non-Domestic Reorganization, acquisition or other purchase of a Chartered Vessel subject to a Chartered Vessel Document, any event or condition occurs that (i) results in any amount (that is not covered by insurance to the extent such insurance is provided by insurers that are solvent and have not denied payment with respect to any such event or condition) in excess of $10,000,000 that any Loan Party or Subsidiary is obligated to pay under any Chartered Vessel Document becoming due prior to its scheduled payment date or (ii) enables or permits (with or without the giving of notice) any Person (A) to cause any amount (that is not covered by insurance to the extent such insurance is provided by insurers that are solvent and have not denied payment with respect to any such event or condition) in excess of $10,000,000 that any Loan Party or Subsidiary is obligated to pay under any Chartered Vessel Document to become due, or (B) to require the prepayment, repurchase, redemption or defeasance of any amount (that is not covered by insurance to the extent such insurance is provided by insurers that are solvent and have not denied payment with respect to any such event or condition) in excess of $10,000,000, in each case prior to its scheduled payment date and, in the case of each of clauses (i) and (ii), such event or condition shall continue unremedied past any applicable cure or grace period for a period of 30 days.

8.15 Attachment/Levy Default. Any material Mortgaged Vessel shall have been (i) attached, levied upon or taken into custody by virtue of any legal proceeding in any court or tribunal or by an Governmental Authority in the United States and such Mortgaged Vessel shall not have been released within 30 days after such attachment, levy or taking into custody or (ii) attached, levied upon or taken into custody by virtue of any legal proceeding in any court or tribunal or by any Governmental Authority outside the United States and such Mortgaged Vessel

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shall not have been released within the earlier of (x) 75 days after such attachment, levy or taking into custody or (y) the date on which the Mortgage Trustee must make a filing in such attachment, levy or taking to preserve its rights.

8.16 Jones Act Trade. Any Loan Party that owns or operates vessels in the coastwise trade of the United States shall cease to qualify as a “citizen of the United States” within the meaning of 46 U.S.C. § 50501(a) and (d), eligible to own and operate vessels in the coastwise trade of the United States or any Loan Party shall have received from the U.S. Coast Guard notice of revocation for any Vessel of its privilege to operate in the coastwise trade of the United States.

9. RIGHTS AND REMEDIES.

9.1 Rights and Remedies. Upon the occurrence and during the continuation of an Event of Default, Agent may, and, at the instruction of the Required Lenders, shall (in each case under clauses (a) or (b) by written notice to Borrower), in addition to any other rights or remedies provided for hereunder or under any other Loan Document or by applicable law, do any one or more of the following:

(a) declare the Obligations (other than the Bank Product Obligations), whether evidenced by this Agreement or by any of the other Loan Documents immediately due and payable, whereupon the same shall become and be immediately due and payable and Borrower shall be obligated to repay all of such Obligations in full, without presentment, demand, protest, or further notice or other requirements of any kind, all of which are hereby expressly waived by Borrower;

(b) declare the Revolver Commitments terminated, whereupon the Revolver Commitments shall immediately be terminated together with (i) any obligation of any Lender hereunder to make Advances, (ii) the obligation of the Swing Lender to make Swing Loans, and (iii) the obligation of the Issuing Lender to issue Letters of Credit; and

(c) exercise all other rights and remedies available to Agent or Lenders under the Loan Documents or applicable law.

The foregoing to the contrary notwithstanding, upon the occurrence of any Event of Default described in Section 8.4 or Section 8.5, in addition to the remedies set forth above, without any notice to Borrower or any other Person or any act by the Lender Group, the Revolver Commitments shall automatically terminate and the Obligations (other than the Bank Product Obligations), inclusive of all accrued and unpaid interest thereon and all fees and all other amounts owing under this Agreement or under any of the other Loan Documents, shall automatically and immediately become due and payable and Borrower shall be obligated to repay all of such Obligations in full, without presentment, demand, protest, or notice of any kind, all of which are expressly waived by Parent.

9.2 Remedies Cumulative. The rights and remedies of the Lender Group under this Agreement, the other Loan Documents, and all other agreements shall be cumulative. The Lender Group shall have all other rights and remedies not inconsistent herewith as provided under the Code, by law, or in equity. No exercise by the Lender Group of one right or remedy

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shall be deemed an election, and no waiver by the Lender Group of any Event of Default shall be deemed a continuing waiver. No delay by the Lender Group shall constitute a waiver, election, or acquiescence by it.

10. WAIVERS; INDEMNIFICATION.

10.1 Demand; Protest; etc. Borrower waives demand, protest, notice of protest, notice of default or dishonor, notice of payment and nonpayment, nonpayment at maturity, release, compromise, settlement, extension, or renewal of documents, instruments, chattel paper, and guarantees at any time held by the Lender Group on which Borrower may in any way be liable.

10.2 The Lender Group’s Liability for Collateral. Borrower hereby agrees that: (a) so long as Agent complies with its obligations, if any, under the Code, the Lender Group shall not in any way or manner be liable or responsible for: (i) the safekeeping of the Collateral, (ii) any loss or damage thereto occurring or arising in any manner or fashion from any cause, (iii) any diminution in the value thereof, or (iv) any act or default of any carrier, warehouseman, bailee, forwarding agency, or other Person, and (b) all risk of loss, damage, or destruction of the Collateral shall be borne by Borrower other than any resulting from the gross negligence, or willful misconduct of any Agent-Related Persons or Lender-Related Persons as determined by court of competent jurisdiction in a final determination.

10.3 Indemnification. Borrower shall pay, indemnify, defend, and hold Agent-Related Persons, the Lender-Related Persons, and each Participant (each, an “Indemnified Person”) harmless (to the fullest extent permitted by law) from and against any and all claims, demands, suits, actions, investigations, proceedings, liabilities, fines, costs, penalties, and damages, and all reasonable fees and disbursements of one external legal counsel for all such Indemnified Persons (and, in the case of an actual or perceived conflict of interest among any one or more Indemnified Persons, one additional counsel to each group of affected Indemnified Parties), experts, or consultants and all other reasonable costs and expenses actually incurred in connection therewith or in connection with the enforcement of this indemnification (as and when they are incurred and irrespective of whether suit is brought), at any time asserted against, imposed upon, or incurred by any of them (a) in connection with or as a result of or related to the execution and delivery (provided that Borrower shall not be liable for costs and expenses (including attorneys fees) of any Lender (other than WFCF) incurred in advising, structuring, drafting, reviewing, administering or syndicating the Loan Documents), enforcement, performance, or administration (including any restructuring or workout with respect hereto) of this Agreement, any of the other Loan Documents, or the Transactions or any transactions contemplated hereby or thereby or the monitoring of Parent’s and its Subsidiaries’ compliance with the terms of the Loan Documents (provided, however, that the indemnification in this clause (a) shall not extend to (i) disputes solely between or among the Lenders, (ii) disputes solely between or among Lenders and their respective Affiliates; it being understood and agreed that the indemnification in this clause (a) shall extend to Agent (but not the Lenders) relative to disputes between or among Agent on the one hand, and one or more Lenders, or one or more of their Affiliates, on the other hand, or (iii) any taxes or any costs attributable to taxes (other than taxes that represent losses, claims, damages, etc. arising from any non-tax claim)), (b) with respect to any investigation, litigation, or proceeding related to this Agreement, any other Loan

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Document, or the use of the proceeds of the credit provided hereunder (irrespective of whether any Indemnified Person is a party thereto), or any act, omission, event, or circumstance in any manner related thereto, and (c) in connection with or arising out of any presence or release of Hazardous Materials at, on, under, to or from any assets or properties owned, leased or operated by Borrower or any of its Subsidiaries or any Environmental Actions, Environmental Liabilities or Remedial Actions related in any way to any such assets or properties of Borrower or any of its Subsidiaries (each and all of the foregoing, the “Indemnified Liabilities”). The foregoing to the contrary notwithstanding, Borrower shall have no obligation to any Indemnified Person under this Section 10.3 with respect to any Indemnified Liability that a court of competent jurisdiction finally determines to have resulted from the gross negligence or willful misconduct of such Indemnified Person or its officers, directors, advisors, legal representatives, employees, attorneys, or agents. This provision shall survive the termination of this Agreement and the repayment of the Obligations. If any Indemnified Person makes any payment to any other Indemnified Person with respect to an Indemnified Liability as to which Borrower was required to indemnify the Indemnified Person receiving such payment, the Indemnified Person making such payment is entitled to be indemnified and reimbursed by Borrower with respect thereto. WITHOUT LIMITATION, THE FOREGOING INDEMNITY SHALL APPLY TO EACH INDEMNIFIED PERSON WITH RESPECT TO INDEMNIFIED LIABILITIES WHICH IN WHOLE OR IN PART ARE CAUSED BY OR ARISE OUT OF ANY NEGLIGENT ACT OR OMISSION OF SUCH INDEMNIFIED PERSON OR OF ANY OTHER PERSON.

11. NOTICES.

Unless otherwise provided in this Agreement, all notices or demands relating to this Agreement or any other Loan Document shall be in writing and (except for financial statements and other informational documents which may be sent by first-class mail, postage prepaid) shall be personally delivered or sent by registered or certified mail (postage prepaid, return receipt requested), overnight courier, electronic mail (at such email addresses as a party may designate in accordance herewith), or facsimile. In the case of notices or demands to Parent, Borrower or Agent, as the case may be, they shall be sent to the respective address set forth below:

If to Parent or Borrower:	HORIZON LINES, INC. 4064 Colony Road, Suite 200 Charlotte, NC 28211 Attn: Michael T. Avara
	Fax No.
with copies to:
	Attn:	, Esq.
	Fax No.

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If to Agent:	WELLS FARGO CAPITAL FINANCE, LLC 1100 Abernathy Road, Suite 1600 Atlanta, GA 30328
	Attn:
	Fax No.
with copies to:	WINSTON & STRAWN LLP 214 N. Tryon Street, Suite 2200 Charlotte, NC 28202 Attn: Molly McGill, Esq.
	Fax No. 704-350-7800

Any party hereto may change the address at which they are to receive notices hereunder, by notice in writing in the foregoing manner given to the other party. All notices or demands sent in accordance with this Section 11, shall be deemed received on the earlier of the date of actual receipt or 3 Business Days after the deposit thereof in the mail; provided, that (a) notices sent by overnight courier service shall be deemed to have been given when received, (b) notices by facsimile shall be deemed to have been given when sent (except that, if not given during normal business hours for the recipient, shall be deemed to have been given at the opening of business on the next Business Day for the recipient) and (c) notices by electronic mail 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 email or other written acknowledgment).

12. CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER.

(a) THE VALIDITY OF THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS (UNLESS EXPRESSLY PROVIDED TO THE CONTRARY IN ANOTHER LOAN DOCUMENT IN RESPECT OF SUCH OTHER LOAN DOCUMENT), THE CONSTRUCTION, INTERPRETATION, AND ENFORCEMENT HEREOF AND THEREOF, AND THE RIGHTS OF THE PARTIES HERETO AND THERETO WITH RESPECT TO ALL MATTERS ARISING HEREUNDER OR THEREUNDER OR RELATED HERETO OR THERETO SHALL BE DETERMINED UNDER, GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

(b) THE PARTIES AGREE THAT ALL ACTIONS OR PROCEEDINGS ARISING IN CONNECTION WITH THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS SHALL BE TRIED AND LITIGATED ONLY IN THE STATE AND, TO THE EXTENT PERMITTED BY APPLICABLE LAW, FEDERAL COURTS LOCATED IN THE COUNTY OF NEW YORK, STATE OF NEW YORK; PROVIDED, HOWEVER, THAT ANY SUIT SEEKING ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT AGENT’S OPTION, IN THE COURTS OF ANY JURISDICTION WHERE AGENT ELECTS TO BRING SUCH ACTION OR WHERE SUCH COLLATERAL OR OTHER PROPERTY MAY BE FOUND. EACH OF PARENT AND BORROWER AND EACH MEMBER OF

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THE LENDER GROUP WAIVE, TO THE EXTENT PERMITTED UNDER APPLICABLE LAW, ANY RIGHT EACH MAY HAVE TO ASSERT THE DOCTRINE OF FORUM NON CONVENIENS OR TO OBJECT TO VENUE TO THE EXTENT ANY PROCEEDING IS BROUGHT IN ACCORDANCE WITH THIS SECTION 12(b).

(c) TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, EACH OF PARENT AND BORROWER AND EACH MEMBER OF THE LENDER GROUP HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF ANY OF THE LOAN DOCUMENTS OR ANY OF THE TRANSACTIONS CONTEMPLATED THEREIN, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR STATUTORY CLAIMS. EACH OF PARENT AND BORROWER AND EACH MEMBER OF THE LENDER GROUP REPRESENT THAT EACH HAS REVIEWED THIS WAIVER AND EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT OF LITIGATION, A COPY OF THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.

(d) EACH OF PARENT AND BORROWER HEREBY IRREVOCABLY AND UNCONDITIONALLY SUBMITS TO THE EXCLUSIVE JURISDICTION OF THE STATE AND FEDERAL COURTS LOCATED IN THE COUNTY OF NEW YORK AND THE STATE OF NEW YORK, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO ANY LOAN DOCUMENTS, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT AGENT 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.

13. ASSIGNMENTS AND PARTICIPATIONS; SUCCESSORS.

13.1 Assignments and Participations.

(a) With the prior written consent of Borrower, which consent of Borrower shall not be unreasonably withheld, delayed or conditioned, and shall not be required (1) if an Event of Default has occurred and is continuing, or (2) in connection with an assignment to a Person that is a Lender, an Affiliate (other than individuals) of a Lender or a Related Fund; provided that Borrower shall be deemed to have consented to a proposed assignment unless it objects thereto by written notice to Agent within 5 Business Days after having received notice thereof, and with the prior written consent of Agent, which consent of Agent shall not be unreasonably withheld, delayed or conditioned, and shall not be required in connection with an assignment to a Person that is a Lender, an Affiliate (other than individuals) of a Lender or a

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Related Fund, any Lender may assign and delegate to one or more assignees so long as such prospective assignee is an Eligible Transferee (each, an “Assignee”; provided, however, that no Loan Party or Affiliate of a Loan Party shall be permitted to become an Assignee) all or any portion of the Obligations, the Revolver Commitments and the other rights and obligations of such Lender hereunder and under the other Loan Documents, in a minimum amount (unless waived by Agent) of $5,000,000 (except such minimum amount shall not apply to (x) an assignment or delegation by any Lender to any other Lender or an Affiliate of any Lender, (y) a group of new Lenders, each of which is an Affiliate of each other or a Related Fund of such new Lender to the extent that the aggregate amount to be assigned to all such new Lenders is at least $5,000,000 or (z) an assignment to one or more Replacement Lenders pursuant to Section 14.2); provided, however, that Borrower and Agent may continue to deal solely and directly with such Lender in connection with the interest so assigned to an Assignee until (i) written notice of such assignment, together with payment instructions, addresses, and related information with respect to the Assignee, have been given to Borrower and Agent by such Lender and the Assignee and such assignment has been recorded in the Register, (ii) such Lender and its Assignee have delivered to Borrower and Agent an Assignment and Acceptance and Agent has notified the assigning Lender of its receipt thereof in accordance with Section 13.1(b), and (iii) except in connection with any assignment to any Replacement Lender pursuant to Section 14.2, unless waived by Agent, the assigning Lender or Assignee has paid to Agent for Agent’s separate account a processing fee in the amount of $3,500.

(b) From and after the date that Agent notifies the assigning Lender (with a copy to Borrower) that it has received an executed Assignment and Acceptance and, if applicable, payment of the required processing fee, (i) the Assignee thereunder shall be a party hereto and, to the extent that rights and obligations hereunder have been assigned to it pursuant to such Assignment and Acceptance, shall be a “Lender” and shall have the rights and obligations of a Lender under the Loan Documents, and (ii) the assigning Lender shall, to the extent that rights and obligations hereunder and under the other Loan Documents have been assigned by it pursuant to such Assignment and Acceptance, relinquish its rights (except with respect to Section 10.3) and be released from any future obligations under this Agreement (and in the case of an Assignment and Acceptance covering all or the remaining portion of an assigning Lender’s rights and obligations under this Agreement and the other Loan Documents, such Lender shall cease to be a party hereto and thereto); provided, however, that nothing contained herein shall release any assigning Lender from obligations that survive the termination of this Agreement, including such assigning Lender’s obligations under Section 15 and Section 17.9(a).

(c) By executing and delivering an Assignment and Acceptance, the assigning Lender thereunder and the Assignee thereunder confirm to and agree with each other and the other parties hereto as follows: (i) other than as provided in such Assignment and Acceptance, such assigning Lender makes no representation or warranty and assumes no responsibility with respect to any statements, warranties or representations made in or in connection with this Agreement or the execution, legality, validity, enforceability, genuineness, sufficiency or value of this Agreement or any other Loan Document furnished pursuant hereto, (ii) such assigning Lender makes no representation or warranty and assumes no responsibility with respect to the financial condition of Borrower or the performance or observance by Borrower of any of its obligations under this Agreement or any other Loan Document furnished pursuant hereto, (iii)

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such Assignee confirms that it has received a copy of this Agreement, together with such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into such Assignment and Acceptance, (iv) such Assignee will, independently and without reliance upon Agent, such assigning Lender or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under this Agreement, (v) such Assignee appoints and authorizes Agent to take such actions and to exercise such powers under this Agreement and the other Loan Documents as are delegated to Agent, by the terms hereof and thereof, together with such powers as are reasonably incidental thereto, and (vi) such Assignee agrees that it will perform all of the obligations which by the terms of this Agreement are required to be performed by it as a Lender.

(d) Immediately upon Agent’s receipt of the required processing fee, if applicable, and delivery of notice to the assigning Lender pursuant to Section 13.1(b), this Agreement shall be deemed to be amended to the extent, but only to the extent, necessary to reflect the addition of the Assignee and the resulting adjustment of the Revolver Commitments arising therefrom. The Revolver Commitment allocated to each Assignee shall reduce such Revolver Commitments of the assigning Lender pro tanto.

(e) Any Lender may at any time sell to one or more commercial banks, financial institutions, or other Persons (a “Participant”) participating interests in all or any portion of its Obligations, its Revolver Commitment, and the other rights and interests of that Lender (the “Originating Lender”) hereunder and under the other Loan Documents; provided, however, that (i) the Originating Lender shall remain a “Lender” for all purposes of this Agreement and the other Loan Documents and the Participant receiving the participating interest in the Obligations, the Revolver Commitments, and the other rights and interests of the Originating Lender hereunder shall not constitute a “Lender” hereunder or under the other Loan Documents and the Originating Lender’s obligations under this Agreement shall remain unchanged, (ii) the Originating Lender shall remain solely responsible for the performance of such obligations, (iii) Borrower, Agent, and the Lenders shall continue to deal solely and directly with the Originating Lender in connection with the Originating Lender’s rights and obligations under this Agreement and the other Loan Documents, (iv) no Lender shall transfer or grant any participating interest under which the Participant has the right to approve any amendment to, or any consent or waiver with respect to, this Agreement or any other Loan Document, except to the extent such amendment to, or consent or waiver with respect to this Agreement or of any other Loan Document would (A) extend the final maturity date of the Obligations hereunder in which such Participant is participating, (B) reduce the interest rate applicable to the Obligations hereunder in which such Participant is participating, (C) release all or substantially all of the Collateral or guaranties (except to the extent expressly provided herein or in any of the Loan Documents) supporting the Obligations hereunder in which such Participant is participating, (D) postpone the payment of, or reduce the amount of, the interest or fees payable to such Participant through such Lender (other than a waiver of default interest), or (E) decrease the amount or postpone the due dates of scheduled principal repayments or prepayments or premiums payable to such Participant through such Lender, and (v) all amounts payable by Borrower hereunder shall be determined as if such Lender had not sold such participation, except that, if amounts outstanding under this Agreement are due and unpaid, or shall have been declared or shall have become due and payable upon the occurrence of an Event of Default, each Participant shall be

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deemed to have the right of set off in respect of its participating interest in amounts owing under this Agreement to the same extent as if the amount of its participating interest were owing directly to it as a Lender under this Agreement. The rights of any Participant are subject to the requirements and limitations therein (including the requirements of Section 16(c)) only shall be derivative through the Originating Lender with whom such Participant participates and no Participant shall have any rights under this Agreement or the other Loan Documents or any direct rights as to the other Lenders, Agent, Borrower, the Collections of Parent or its Subsidiaries, the Collateral, or otherwise in respect of the Obligations. No Participant shall have the right to participate directly in the making of decisions by Lenders among themselves.

(f) In connection with any such assignment or participation or proposed assignment or participation or any grant of a security interest in, or pledge of, its rights under and interest in this Agreement, a Lender may, subject to the provisions of Section 17.9, disclose all documents and information which it now or hereafter may have relating to Parent and its Subsidiaries and their respective businesses.

(g) Any other provision in this Agreement notwithstanding, any Lender may at any time create a security interest in, or pledge, all or any portion of its rights under and interest in this Agreement in favor of any Federal Reserve Bank in accordance with Regulation A of the Federal Reserve Bank or U.S. Treasury Regulation 31 CFR §203.24, and such Federal Reserve Bank may enforce such pledge or security interest in any manner permitted under applicable law.

(h) Agent (as a non-fiduciary agent on behalf of Borrower) shall maintain, or cause to be maintained, a register (the “Register”) on which it enters the name and address of each Lender and the Commitments of, and principal amounts (and stated interest) of the Advances owing to, each Lender pursuant to the terms hereof from time to time (each, a “Registered Loan”). (i) A Registered Loan (and the registered note, if any, evidencing the same) may be assigned or sold in whole or in part only by registration of such assignment or sale on the Register (and each registered note shall expressly so provide) and (ii) any assignment or sale of all or part of such Registered Loan (and the registered note, if any, evidencing the same) may be effected only by registration of such assignment or sale on the Register, together with the surrender of the registered note, if any, evidencing the same duly endorsed by (or accompanied by a written instrument of assignment or sale duly executed by) the holder of such registered note, whereupon, at the request of the designated assignee(s) or transferee(s), one or more new registered notes in the same aggregate principal amount shall be issued to the designated assignee(s) or transferee(s). Prior to the registration of assignment or sale of any Registered Loan (and the registered note, if any evidencing the same), Borrower shall treat the Person in whose name such Registered Loan (and the registered note, if any, evidencing the same) is registered as the owner thereof for the purpose of receiving all payments thereon and for all other purposes, notwithstanding notice to the contrary.

(i) In the event that a Lender sells participations in the Registered Loan, such Lender, as a non-fiduciary agent on behalf of Borrower, shall maintain (or cause to be maintained) a register on which it enters the name of all participants in the Registered Loans held by it (and the principal amount (and stated interest thereon) of the portion of such Registered Loans that is subject to such participations) (the “Participant Register”); provided that no Lender

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shall have any obligation to disclose all or any portion of the Participant Register (including the identity of any Participant or any information relating to a Participant’s interest in any commitments, loans, letters of credit or its other obligations under any Loan Document) to any Person except to the extent that such disclosure is necessary to establish that such commitment, loan, letter of credit or other obligation is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations. 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. For the avoidance of doubt, Agent (in its capacity as Agent) shall have no responsibility for maintaining a Participant Register. A Registered Loan (and the registered note, if any, evidencing the same) may be participated in whole or in part only by registration of such participation on the Participant Register (and each registered note shall expressly so provide). Any participation of such Registered Loan (and the registered note, if any, evidencing the same) may be effected only by the registration of such participation on the Participant Register.

(j) Agent shall make a copy of the Register (and each Lender shall make a copy of its Participant Register to the extent it has one) available for review by Borrower from time to time as Borrower may reasonably request.

(k) The entries in the Register shall be conclusive absent manifest error, and Borrower, Agent and Lenders shall treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement.

13.2 Successors. This Agreement shall bind and inure to the benefit of the respective successors and assigns of each of the parties; provided, however, that Borrower may not assign this Agreement or any rights or duties hereunder without Lenders’ prior written consent and any prohibited assignment shall be absolutely void ab initio. No consent to assignment by Lenders shall release Borrower from its Obligations. A Lender may assign this Agreement and the other Loan Documents and its rights and duties hereunder and thereunder pursuant to Section 13.1 and, except as expressly required pursuant to Section 13.1, no consent or approval by Borrower is required in connection with any such assignment.

14. AMENDMENTS; WAIVERS.

14.1 Amendments and Waivers.

(a) No amendment, waiver or other modification of any provision of this Agreement or any other Loan Document (other than Bank Product Agreements or the Fee Letter), and no consent with respect to any departure by Parent therefrom, shall be effective unless the same shall be in writing and signed by the Required Lenders (or by Agent at the written request of the Required Lenders) and the Loan Parties that are party thereto and then any such waiver or consent shall be effective, but only in the specific instance and for the specific purpose for which given; provided, however, that no such waiver, amendment, or consent shall, unless in writing and signed by all of the Lenders directly affected thereby and all of the Loan Parties that are party thereto, do any of the following:

(i) increase the amount of or extend the expiration date of any Revolver Commitment of any Lender or amend, modify, or eliminate the last sentence of Section 2.4(c) regarding pro rata Revolver Commitment reductions;

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(ii) postpone or delay any date fixed by this Agreement or any other Loan Document for any payment of principal, interest, fees, or other amounts due hereunder or under any other Loan Document (other than mandatory prepayments, the payment of which may be waived, postponed or delayed with the consent of the Required Lenders);

(iii) reduce the principal of, or the rate of interest on, any loan or other extension of credit hereunder, or reduce any fees or other amounts payable hereunder or under any other Loan Document (except (x) in connection with the waiver of applicability of Section 2.6(c) (which waiver shall be effective with the written consent of the Required Lenders and (y) that any amendment or modification of defined terms used in the financial covenants and ratios under this Agreement shall not constitute a reduction in the rate of interest or a reduction of fees or any other amounts for purposes of this clause (iii));

(iv) amend, modify, or eliminate this Section or any provision of this Agreement providing for consent or other action by all Lenders;

(v) other than as permitted by Section 15.11 or as provided in the Intercreditor Agreement, release Agent’s Lien in and to any material portion of the Collateral;

(vi) amend, modify, or eliminate the definition of “Required Lenders” or “Pro Rata Share”;

(vii) contractually subordinate any of Agent’s Liens other than as provided in Section 15.11 or in the Intercreditor Agreement;

(viii) other than in connection with a merger, liquidation, dissolution or sale of such Person expressly permitted by the terms hereof or the other Loan Documents, release Borrower or any Guarantor from any obligation for the payment of money or consent to the assignment or transfer by Borrower or any Guarantor of any of its rights or duties under this Agreement or the other Loan Documents;

(ix) amend, modify, or eliminate any of the provisions of Section 2.4(b)(i) or (ii);

(x) amend, modify, or eliminate any of the provisions of Section 13.1(a) to permit a Loan Party or an Affiliate of a Loan Party to be permitted to become an Assignee; or

(xi) amend, modify, or eliminate the definition of Borrowing Base or any of the defined terms (including the definition of Eligible Accounts) that are used in such definition to the extent that any such change results in more credit being made available to Borrower based upon the Borrowing Base, but not otherwise, or change Section 2.1(c).

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(b) No amendment, waiver, modification, elimination, or consent shall amend, modify, or waive (i) the definition of, or any of the terms or provisions of, the Fee Letter, without the written consent of Agent and Parent (and shall not require the written consent of any of the Lenders), and (ii) any provision of Section 15 pertaining to Agent, or any other rights or duties of Agent under this Agreement or the other Loan Documents, without the written consent of Agent, Borrower, and the Required Lenders,

(c) No amendment, waiver, modification, elimination, or consent shall amend, modify, or waive any provision of this Agreement or the other Loan Documents pertaining to Issuing Lender, or any other rights or duties of Issuing Lender under this Agreement or the other Loan Documents, without the written consent of Issuing Lender, Agent, Borrower, and the Required Lenders,

(d) No amendment, waiver, modification, elimination, or consent shall amend, modify, or waive any provision of this Agreement or the other Loan Documents pertaining to Swing Lender, or any other rights or duties of Swing Lender under this Agreement or the other Loan Documents, without the written consent of Swing Lender, Agent, Borrower, and the Required Lenders,

(e) Anything in this Section 14.1 to the contrary notwithstanding, (i) any amendment, modification, elimination, waiver, consent, termination, or release of, or with respect to, any provision of this Agreement or any other Loan Document that relates only to the relationship of the Lender Group among themselves, and that does not affect the rights or obligations of Parent or any of its Subsidiaries, shall not require consent by or the agreement of any Loan Party, (ii) any amendment, waiver, modification, elimination, or consent of or with respect to any provision of this Agreement or any other Loan Document may be entered into without the consent of, or over the objection of, any Defaulting Lender other than any of the matters governed by Section 14.1(a)(i) through (iii), (iii) any amendments necessary to implement any increase in the Maximum Revolver Amount in accordance with Section 2.14, shall be effective if in a writing signed only by Agent and Borrower and (iv) nothing in this Section 14.1 shall be construed to prohibit the amendment of any schedule hereto or to any other Loan Document which is expressly permitted to be amended pursuant to written notice provided to Agent by Borrower or the applicable Loan Party.

14.2 Replacement of Certain Lenders.

(a) If (i) any action to be taken by the Lender Group or Agent hereunder requires the consent, authorization, or agreement of all Lenders or all Lenders affected thereby and if such action has received the consent, authorization, or agreement of the Required Lenders but not of all Lenders or all Lenders affected thereby, (ii) any Lender makes a claim for compensation under Section 16 and a replacement will result in a reduction in such compensation thereafter (a “Tax Lender”), or (iii) any Lender is a Defaulting Lender, then Borrower or Agent, upon at least 5 Business Days prior irrevocable notice, may permanently replace any Lender that failed to give its consent, authorization, or agreement (a “Holdout

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Lender”), any Tax Lender or any Defaulting Lender with one or more Replacement Lenders, and the Holdout Lender, Tax Lender or Defaulting Lender, as applicable, shall have no right to refuse to be replaced hereunder. Such notice to replace the Holdout Lender, Tax Lender or Defaulting Lender, as applicable, shall specify an effective date for such replacement, which date shall not be later than 15 Business Days after the date such notice is given and such Lender will retain its existing rights to payments pursuant to Sections 2 and 16.

(b) Prior to the effective date of such replacement, the Holdout Lender, Tax Lender or Defaulting Lender, as applicable, and each Replacement Lender shall execute and deliver an Assignment and Acceptance, subject only to the Holdout Lender, Tax Lender or Defaulting Lender, as applicable, being repaid in full its share of the outstanding Obligations (without any premium or penalty of any kind whatsoever, but including (i) all interest, fees and other amounts that may be due and payable in respect thereof, and (ii) an assumption of its Pro Rata Share of participations in the Letters of Credit). If the Holdout Lender, Tax Lender or Defaulting Lender, as applicable, shall refuse or fail to execute and deliver any such Assignment and Acceptance prior to the effective date of such replacement, Agent may, but shall not be required to, execute and deliver such Assignment and Acceptance in the name or and on behalf of the Holdout Lender, Tax Lender or Defaulting Lender, as applicable, and irrespective of whether Agent executes and delivers such Assignment and Acceptance, the Holdout Lender, Tax Lender or Defaulting Lender, as applicable, shall be deemed to have executed and delivered such Assignment and Acceptance. The replacement of any Holdout Lender, Tax Lender or Defaulting Lender, as applicable, shall otherwise be made in accordance with the terms of Section 13.1. Until such time as one or more Replacement Lenders shall have acquired all of the Obligations, the Revolver Commitments, and the other rights and obligations of the Holdout Lender, Tax Lender or Defaulting Lender, as applicable, hereunder and under the other Loan Documents, the Holdout Lender, Tax Lender or Defaulting Lender, as applicable, shall remain obligated to make the Holdout Lender’s, Tax Lender’s or Defaulting Lender’s, as applicable, Pro Rata Share of Advances and to purchase a participation in each Letter of Credit, in an amount equal to its Pro Rata Share of such Letters of Credit.

14.3 No Waivers; Cumulative Remedies. No failure by Agent or any Lender to exercise any right, remedy, or option under this Agreement or any other Loan Document, or delay by Agent or any Lender in exercising the same, will operate as a waiver thereof. No waiver by Agent or any Lender will be effective unless it is in writing, and then only to the extent specifically stated. No waiver by Agent or any Lender on any occasion shall affect or diminish Agent’s and each Lender’s rights thereafter to require strict performance by Parent and Borrower of any provision of this Agreement. Agent’s and each Lender’s rights under this Agreement and the other Loan Documents will be cumulative and not exclusive of any other right or remedy that Agent or any Lender may have.

15. AGENT; THE LENDER GROUP.

15.1 Appointment and Authorization of Agent. Each Lender hereby designates and appoints WFCF as its agent under this Agreement and the other Loan Documents and each Lender hereby irrevocably authorizes (and by entering into a Bank Product Agreement, each Bank Product Provider shall be deemed to designate, appoint, and authorize) Agent to execute and deliver each of the other Loan Documents on its behalf and to take such other action on its

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behalf under the provisions of this Agreement and each other Loan Document and to exercise such powers and perform such duties as are expressly delegated to Agent by the terms of this Agreement or any other Loan Document, together with such powers as are reasonably incidental thereto. Agent agrees to act as agent for and on behalf of Lenders (and the Bank Product Providers) on the conditions contained in this Section 15. Any provision to the contrary contained elsewhere in this Agreement or in any other Loan Document notwithstanding, Agent shall not have any duties or responsibilities, except those expressly set forth herein or in the other Loan Documents, nor shall Agent have or be deemed to have any fiduciary relationship with any Lender (or Bank Product Provider), and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this Agreement or any other Loan Document or otherwise exist against Agent. Without limiting the generality of the foregoing, the use of the term “agent” in this Agreement or the other Loan Documents with reference to Agent is not intended to connote any fiduciary or other implied (or express) obligations arising under agency doctrine of any applicable law. Instead, such term is used merely as a matter of market custom, and is intended to create or reflect only a representative relationship between independent contracting parties. Each Lender hereby further authorizes (and by entering into a Bank Product Agreement, each Bank Product Provider shall be deemed to authorize) Agent to act as the secured party under each of the Loan Documents that create a Lien on any item of Collateral. Except as expressly otherwise provided in this Agreement, Agent shall have and may use its sole discretion with respect to exercising or refraining from exercising any discretionary rights or taking or refraining from taking any actions that Agent expressly is entitled to take or assert under or pursuant to this Agreement and the other Loan Documents. Without limiting the generality of the foregoing, or of any other provision of the Loan Documents that provides rights or powers to Agent, Lenders agree that Agent shall have the right to exercise the following powers as long as this Agreement remains in effect: (a) maintain, in accordance with its customary business practices, ledgers and records reflecting the status of the Obligations, the Collateral, the Collections of the Loan Parties, and related matters, (b) execute or file any and all financing or similar statements or notices, amendments, renewals, supplements, documents, instruments, proofs of claim, notices and other written agreements with respect to the Loan Documents, (c) make Advances, for itself or on behalf of Lenders, as provided in the Loan Documents, (d) exclusively receive, apply, and distribute the Collections of the Loan Parties as provided in the Loan Documents, (e) open and maintain such bank accounts and cash management arrangements as Agent deems necessary and appropriate in accordance with the Loan Documents for the foregoing purposes with respect to the Collateral and the Collections of the Loan Parties, (f) perform, exercise, and enforce any and all other rights and remedies of the Lender Group with respect to Parent or its Subsidiaries, the Obligations, the Collateral, the Collections of the Loan Parties, or otherwise related to any of same as provided in the Loan Documents, and (g) incur and pay such Lender Group Expenses as Agent may deem necessary or appropriate for the performance and fulfillment of its functions and powers pursuant to the Loan Documents.

15.2 Delegation of Duties. Agent may execute any of its duties under this Agreement or any other Loan Document by or through agents, employees or attorneys in fact and shall be entitled to advice of counsel concerning all matters pertaining to such duties. Agent shall not be responsible for the negligence or misconduct of any agent or attorney in fact that it selects as long as such selection was made without gross negligence or willful misconduct.

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15.3 Liability of Agent. None of the Agent-Related Persons shall (a) be liable for any action taken or omitted to be taken by any of them under or in connection with this Agreement or any other Loan Document or the Transactions or any transactions contemplated hereby (except for its own gross negligence or willful misconduct), or (b) be responsible in any manner to any of Lenders (or Bank Product Providers) for any recital, statement, representation or warranty made by Parent or any of its Subsidiaries or Affiliates, or any officer or director thereof, contained in this Agreement or in any other Loan Document, or in any certificate, report, statement or other document referred to or provided for in, or received by Agent under or in connection with, this Agreement or any other Loan Document, or the validity, effectiveness, genuineness, enforceability or sufficiency of this Agreement or any other Loan Document, or for any failure of Parent or its Subsidiaries or any other party to any Loan Document to perform its obligations hereunder or thereunder. No Agent-Related Person shall be under any obligation to any Lenders (or Bank Product Providers) to ascertain or to inquire as to the observance or performance of any of the agreements contained in, or conditions of, this Agreement or any other Loan Document, or to inspect the books and records or properties of Parent or its Subsidiaries.

15.4 Reliance by Agent. Agent shall be entitled to rely, and shall be fully protected in relying, upon any writing, resolution, notice, consent, certificate, affidavit, letter, telegram, facsimile or other electronic method of transmission, telex or telephone message, statement or other document or conversation believed by it to be genuine and correct and to have been signed, sent, or made by the proper Person or Persons, and upon advice and statements of legal counsel (including counsel to Borrower or counsel to any Lender), independent accountants and other experts selected by Agent. Agent shall be fully justified in failing or refusing to take any action under this Agreement or any other Loan Document unless Agent shall first receive such advice or concurrence of Lenders as it deems appropriate and until such instructions are received, Agent shall act, or refrain from acting, as it deems advisable. If Agent so requests, it shall first be indemnified to its reasonable satisfaction by Lenders (and, if it so elects, the Bank Product Providers) against any and all liability and expense that may be incurred by it by reason of taking or continuing to take any such action. Agent shall in all cases be fully protected in acting, or in refraining from acting, under this Agreement or any other Loan Document in accordance with a request or consent of the Required Lenders and such request and any action taken or failure to act pursuant thereto shall be binding upon all of Lenders (and Bank Product Providers). Notwithstanding any other provision of a Loan Document to the contrary, Agent need not, and may omit to, do anything if it would or might in its reasonable opinion constitute a breach of any law or regulation or a breach of a fiduciary obligation or duty of confidentiality.

15.5 Notice of Default or Event of Default. Agent shall not be deemed to have knowledge or notice of the occurrence of any Default or Event of Default, except with respect to defaults in the payment of principal, interest, fees, and expenses required to be paid to Agent for the account of Lenders and, except with respect to Events of Default of which Agent has actual knowledge, unless Agent shall have received written notice from a Lender or Borrower referring to this Agreement, describing such Default or Event of Default, and stating that such notice is a “notice of default.” Agent promptly will notify Lenders of its receipt of any such notice or of any Event of Default of which Agent has actual knowledge. If any Lender obtains actual knowledge of any Event of Default, such Lender promptly shall notify the other Lenders and Agent of such Event of Default. Each Lender shall be solely responsible for giving any notices to its Participants, if any. Subject to Section 15.4, Agent shall take such action with respect to

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such Default or Event of Default as may be requested by the Required Lenders in accordance with Section 9; provided, however, that unless and until Agent has received any such request, Agent may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to such Default or Event of Default as it shall deem advisable.

15.6 Credit Decision. Each Lender (and Bank Product Provider) acknowledges that none of the Agent-Related Persons has made any representation or warranty to it, and that no act by Agent hereinafter taken, including any review of the affairs of Parent and its Subsidiaries or Affiliates, shall be deemed to constitute any representation or warranty by any Agent-Related Person to any Lender (or Bank Product Provider). Each Lender represents (and by entering into a Bank Product Agreement, each Bank Product Provider shall be deemed to represent) to Agent that it has, independently and without reliance upon any Agent-Related Person and based on such due diligence, documents and information as it has deemed appropriate, made its own appraisal of and investigation into the business, prospects, operations, property, financial and other condition and creditworthiness of Borrower or any other Person party to a Loan Document, and all applicable bank regulatory laws relating to the Transactions or any transactions contemplated hereby, and made its own decision to enter into this Agreement and to extend credit to Borrower. Each Lender also represents (and by entering into a Bank Product Agreement, each Bank Product Provider shall be deemed to represent) that it will, independently and without reliance upon any Agent-Related Person and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit analysis, appraisals and decisions in taking or not taking action under this Agreement and the other Loan Documents, and to make such investigations as it deems necessary to inform itself as to the business, prospects, operations, property, financial and other condition and creditworthiness of Borrower or any other Person party to a Loan Document. Except for notices, reports, and other documents expressly herein required to be furnished to Lenders by Agent, Agent shall not have any duty or responsibility to provide any Lender (or Bank Product Provider) with any credit or other information concerning the business, prospects, operations, property, financial and other condition or creditworthiness of Borrower or any other Person party to a Loan Document that may come into the possession of any of the Agent-Related Persons. Each Lender acknowledges (and by entering into a Bank Product Agreement, each Bank Product Provider shall be deemed to acknowledge) that Agent does not have any duty or responsibility, either initially or on a continuing basis (except to the extent, if any, that is expressly specified herein) to provide such Lender (or Bank Product Provider) with any credit or other information with respect to Borrower, its Affiliates or any of their respective business, legal, financial or other affairs, and irrespective of whether such information came into Agent’s or its Affiliates’ or representatives’ possession before or after the date on which such Lender became a party to this Agreement (or such Bank Product Provider entered into a Bank Product Agreement).

15.7 Costs and Expenses; Indemnification. Agent may incur and pay Lender Group Expenses to the extent Agent reasonably deems necessary or appropriate for the performance and fulfillment of its functions, powers, and obligations pursuant to the Loan Documents, including court costs, attorneys fees and expenses, fees and expenses of financial accountants, advisors, consultants, and appraisers, costs of collection by outside collection agencies, auctioneer fees and expenses, and costs of security guards or insurance premiums paid to maintain the Collateral, whether or not Borrower is obligated to reimburse Agent or Lenders for such expenses pursuant to this Agreement or otherwise. Agent is authorized and directed to deduct and retain sufficient

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amounts from the Collections of the Loan Parties received by Agent to reimburse Agent for such out-of-pocket costs and expenses prior to the distribution of any amounts to Lenders (or Bank Product Providers). In the event Agent is not reimbursed for such costs and expenses by any Loan Party, each Lender hereby agrees that it is and shall be obligated to pay to Agent such Lender’s ratable thereof. Whether or not the transactions contemplated hereby are consummated, each of the Lenders, on a ratable basis, shall indemnify and defend the Agent-Related Persons (to the extent not reimbursed by or on behalf of Borrower and without limiting the obligation of Borrower to do so) from and against any and all Indemnified Liabilities; provided, however, that no Lender shall be liable for the payment to any Agent-Related Person of any portion of such Indemnified Liabilities resulting solely from such Person’s gross negligence or willful misconduct nor shall any Lender be liable for the obligations of any Defaulting Lender in failing to make an Advance or other extension of credit hereunder. Without limitation of the foregoing, each Lender shall reimburse Agent upon demand for such Lender’s ratable share of any costs or out of pocket expenses (including attorneys, accountants, advisors, and consultants fees and expenses) incurred by Agent in connection with the preparation, execution, delivery, administration, modification, amendment, or enforcement (whether through negotiations, legal proceedings or otherwise) of, or legal advice in respect of rights or responsibilities under, this Agreement or any other Loan Document to the extent that Agent is not reimbursed for such expenses by or on behalf of Borrower. The undertaking in this Section shall survive the payment of all Obligations hereunder and the resignation or replacement of Agent.

15.8 Agent in Individual Capacity. WFCF and its Affiliates may make loans to, issue letters of credit for the account of, accept deposits from, provide Bank Products to, acquire equity interests in, and generally engage in any kind of banking, trust, financial advisory, underwriting, or other business with Parent and its Subsidiaries and Affiliates and any other Person party to any Loan Document as though WFCF were not Agent hereunder, and, in each case, without notice to or consent of the other members of the Lender Group. The other members of the Lender Group acknowledge (and by entering into a Bank Product Agreement, each Bank Product Provider shall be deemed to acknowledge) that, pursuant to such activities, WFCF or its Affiliates may receive information regarding Parent or its Affiliates or any other Person party to any Loan Documents that is subject to confidentiality obligations in favor of Parent or such other Person and that prohibit the disclosure of such information to the Lenders (or Bank Product Providers), and Lenders acknowledge (and by entering into a Bank Product Agreement, each Bank Product Provider shall be deemed to acknowledge) that, in such circumstances (and in the absence of a waiver of such confidentiality obligations, which waiver Agent will use its reasonable best efforts to obtain), Agent shall not be under any obligation to provide such information to them. The terms “Lender” and “Lenders” include WFCF in its individual capacity.

15.9 Successor Agent. Agent may resign as Agent upon 30 days prior written notice to the Lenders (unless such notice is waived by the Required Lenders) and Borrower (unless such notice is waived by Borrower) and without any notice to the Bank Product Providers. If Agent resigns under this Agreement, the Required Lenders shall be entitled, with (so long as no Event of Default has occurred and is continuing) the consent of Borrower (such consent not to be unreasonably withheld, delayed, or conditioned), appoint a successor Agent for the Lenders (and the Bank Product Providers). If, at the time that Agent’s resignation is effective, it is acting as

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the Issuing Lender or the Swing Lender, such resignation shall also operate to effectuate its resignation as the Issuing Lender or the Swing Lender, as applicable, and it shall automatically be relieved of any further obligation to issue Letters of Credit, to cause the Underlying Issuer to issue Letters of Credit, or to make Swing Loans. If no successor Agent is appointed prior to the effective date of the resignation of Agent, Agent may appoint, after consulting with the Lenders and Borrower, a successor Agent. If Agent has materially breached or failed to perform any material provision of this Agreement or of applicable law or if any Insolvency Proceeding is commenced by or against Agent, the Required Lenders may agree in writing to remove and replace Agent with a successor Agent from among the Lenders with (so long as no Event of Default has occurred and is continuing) the consent of Borrower (such consent not to be unreasonably withheld, delayed, or conditioned). In any such event, upon the acceptance of its appointment as successor Agent hereunder, such successor Agent shall succeed to all the rights, powers, and duties of the retiring Agent and the term “Agent” shall mean such successor Agent and the retiring Agent’s appointment, powers, and duties as Agent shall be terminated. After any retiring Agent’s resignation hereunder as Agent, the provisions of this Section 15 shall inure to its benefit as to any actions taken or omitted to be taken by it while it was Agent under this Agreement. If no successor Agent has accepted appointment as Agent by the date which is 30 days following a retiring Agent’s notice of resignation, the retiring Agent’s resignation shall nevertheless thereupon become effective and the Required Lenders shall perform all of the duties of Agent hereunder until such time, if any, as the Required Lenders appoint a successor Agent as provided for above.

15.10 Lender in Individual Capacity. Any Lender and its respective Affiliates may make loans to, issue letters of credit for the account of, accept deposits from, provide Bank Products to, acquire equity interests in and generally engage in any kind of banking, trust, financial advisory, underwriting, or other business with Parent and its Subsidiaries and Affiliates and any other Person party to any Loan Documents as though such Lender were not a Lender hereunder without notice to or consent of the other members of the Lender Group (or the Bank Product Providers). The other members of the Lender Group acknowledge (and by entering into a Bank Product Agreement, each Bank Product Provider shall be deemed to acknowledge) that, pursuant to such activities, such Lender and its respective Affiliates may receive information regarding Parent or its Affiliates or any other Person party to any Loan Documents that is subject to confidentiality obligations in favor of Parent, such Affiliate or such other Person and that prohibit the disclosure of such information to the Lenders, and the Lenders acknowledge (and by entering into a Bank Product Agreement, each Bank Product Provider shall be deemed to acknowledge) that, in such circumstances (and in the absence of a waiver of such confidentiality obligations, which waiver such Lender will use its reasonable best efforts to obtain), such Lender shall not be under any obligation to provide such information to them.

15.11 Collateral Matters.

(a) Lenders hereby irrevocably authorize (and by entering into a Bank Product Agreement, each Bank Product Provider shall be deemed to authorize) Agent to release any Lien on any Collateral (i) upon the termination of the Revolver Commitments and payment in full of all of the Obligations, (ii) constituting property being sold, transferred or otherwise disposed of if a release is required or desirable in connection therewith and if Borrower certifies to Agent that the sale or disposition is permitted under Section 6.4 (and Agent may rely conclusively on any

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such certificate, without further inquiry), (iii) constituting property in which Parent or its Subsidiaries owned no interest at the time Agent’s Lien was granted nor at the time of such release, (iv) constituting property leased to Parent or its Subsidiaries under a lease that has expired, is terminated in a transaction permitted under this Agreement or (v) constituting Secured Notes Priority Collateral in connection with the release of Liens on such Collateral as provided for in the Intercreditor Agreement. The Loan Parties and Lenders hereby irrevocably authorize (and by entering into a Bank Product Agreement, each Bank Product Provider shall be deemed to authorize) Agent, based upon the instruction of the Required Lenders, to (a) consent to, credit bid or purchase (either directly or through one or more acquisition vehicles) all or any portion of the Collateral at any sale thereof conducted under the provisions of the Bankruptcy Code, including under Section 363 of the Bankruptcy Code, (b) credit bid or purchase (either directly or through one or more acquisition vehicles) all or any portion of the Collateral at any sale or other disposition thereof conducted under the provisions of the Code, including pursuant to Sections 9-610 or 9-620 of the Code, or (c) credit bid or purchase (either directly or through one or more acquisition vehicles) all or any portion of the Collateral at any other sale or foreclosure conducted by Agent (whether by judicial action or otherwise) in accordance with applicable law. In connection with any such credit bid or purchase, the Obligations owed to Lenders and the Bank Product Providers shall be entitled to be, and shall be, credit bid on a ratable basis (with Obligations with respect to contingent or unliquidated claims being estimated for such purpose if the fixing or liquidation thereof would not unduly delay the ability of Agent to credit bid or purchase at such sale or other disposition of the Collateral and, if such claims cannot be estimated without unduly delaying the ability of Agent to credit bid, then such claims shall be disregarded, not credit bid, and not entitled to any interest in the asset or assets purchased by means of such credit bid) and Lenders and the Bank Product Providers whose Obligations are credit bid shall be entitled to receive interests (ratably based upon the proportion of their Obligations credit bid in relation to the aggregate amount of Obligations so credit bid) in the asset or assets so purchased (or in the Stock of the acquisition vehicle or vehicles that are used to consummate such purchase). Except as provided above, Agent will not execute and deliver a release of any Lien on any Collateral without the prior written authorization of (y) if the release is of all or substantially all of the Collateral, all of the Lenders other than any Defaulting Lenders (without requiring the authorization of the Bank Product Providers), or (z) otherwise, the Required Lenders other than Defaulting Lenders (without requiring the authorization of the Bank Product Providers). Upon request by Agent or Borrower at any time, the Lenders will (and if so requested, the Bank Product Providers will) confirm in writing Agent’s authority to release any such Liens on particular types or items of Collateral pursuant to this Section 15.11; provided, however, that (1) Agent shall not be required to execute any document necessary to evidence such release on terms that, in Agent’s opinion, would expose Agent to liability or create any obligation or entail any consequence other than the release of such Lien without recourse, representation, or warranty, and (2) such release shall not in any manner discharge, affect, or impair the Obligations or any Liens (other than those expressly being released) upon (or obligations of Borrower in respect of) all interests retained by Borrower, including, the proceeds of any sale, all of which shall continue to constitute part of the Collateral. Lenders further hereby irrevocably authorize (and by entering into a Bank Product Agreement, each Bank Product Provider shall be deemed to authorize) Agent, at its option and in its sole discretion, to release or subordinate any Lien granted to or held by Agent under any Loan Document to the holder of any Permitted Lien on such property if such Permitted Lien secures Permitted Purchase

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Money Indebtedness (and any Refinancing Indebtedness in respect thereof) or the Secured Notes (and any Refinancing Indebtedness in respect thereof) (but only with respect to Secured Notes Priority Collateral) or as otherwise permitted under the Loan Documents.

(b) Agent shall have no obligation whatsoever to any of the Lenders (or the Bank Product Providers) to assure that the Collateral exists or is owned by Parent or its Subsidiaries or is cared for, protected, or insured or has been encumbered, or that Agent’s Liens have been properly or sufficiently or lawfully created, perfected, protected, or enforced or are entitled to any particular priority, or that any particular items of Collateral meet the eligibility criteria applicable in respect thereof or whether to impose, maintain, reduce, or eliminate any particular reserve hereunder or whether the amount of any such reserve is appropriate or not, or to exercise at all or in any particular manner or under any duty of care, disclosure or fidelity, or to continue exercising, any of the rights, authorities and powers granted or available to Agent pursuant to any of the Loan Documents, it being understood and agreed that in respect of the Collateral, or any act, omission, or event related thereto, subject to the terms and conditions contained herein, Agent may act in any manner it may deem appropriate, in its sole discretion given Agent’s own interest in the Collateral in its capacity as one of the Lenders and that Agent shall have no other duty or liability whatsoever to any Lender (or Bank Product Provider) as to any of the foregoing, except as otherwise provided herein.

15.12 Restrictions on Actions by Lenders; Sharing of Payments.

(a) Each of the Lenders agrees that it shall not, without the express written consent of Agent, and that it shall, to the extent it is lawfully entitled to do so, upon the written request of Agent, set off against the Obligations, any amounts then due and owing by such Lender to any Loan Party or any deposit accounts of a Loan Party now or hereafter maintained with such Lender. Each of the Lenders further agrees that it shall not, unless specifically requested to do so in writing by Agent, take or cause to be taken any action, including, the commencement of any legal or equitable proceedings to enforce any Loan Document against Borrower or any Guarantor or to foreclose any Lien on, or otherwise enforce any security interest in, any of the Collateral.

(b) If, at any time or times any Lender shall receive (i) by payment, foreclosure, setoff, or otherwise, any proceeds of Collateral or any payments with respect to the Obligations, except for any such proceeds or payments received by such Lender from Agent pursuant to the terms of this Agreement, or (ii) payments from Agent in excess of such Lender’s Pro Rata Share of all such distributions by Agent, such Lender promptly shall (A) turn the same over to Agent, in kind, and with such endorsements as may be required to negotiate the same to Agent, or in immediately available funds, as applicable, for the account of all of the Lenders and for application to the Obligations in accordance with the applicable provisions of this Agreement, or (B) purchase, without recourse or warranty, an undivided interest and participation in the Obligations owed to the other Lenders so that such excess payment received shall be applied ratably as among the Lenders in accordance with their Pro Rata Shares; provided, however, that to the extent that such excess payment received by the purchasing party is thereafter recovered from it, those purchases of participations shall be rescinded in whole or in part, as applicable, and the applicable portion of the purchase price paid therefor shall be returned to such purchasing party, but without interest except to the extent that such purchasing party is required to pay interest in connection with the recovery of the excess payment.

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15.13 Agency for Perfection. Agent hereby appoints each other Lender (and each Bank Product Provider) as its agent (and each Lender hereby accepts (and by entering into a Bank Product Agreement, each Bank Product Provider shall be deemed to accept) such appointment) for the purpose of perfecting Agent’s Liens in assets which, in accordance with Article 8 or Article 9, as applicable, of the Code can be perfected by possession or control. Should any Lender obtain possession or control of any such Collateral, such Lender shall notify Agent thereof, and, promptly upon Agent’s request therefor shall deliver possession or control of such Collateral to Agent or in accordance with Agent’s instructions.

15.14 Payments by Agent to Lenders. All payments to be made by Agent to the Lenders (or Bank Product Providers) shall be made by bank wire transfer of immediately available funds pursuant to such wire transfer instructions as each party may designate for itself by written notice to Agent. Concurrently with each such payment, Agent shall identify whether such payment (or any portion thereof) represents principal, premium, fees, or interest of the Obligations.

15.15 Concerning the Collateral and Related Loan Documents. Each member of the Lender Group authorizes and directs Agent to enter into this Agreement and the other Loan Documents. Each member of the Lender Group agrees (and by entering into a Bank Product Agreement, each Bank Product Provider shall be deemed to agree) that any action taken by Agent in accordance with the terms of this Agreement or the other Loan Documents relating to the Collateral and the exercise by Agent of its powers set forth therein or herein, together with such other powers that are reasonably incidental thereto, shall be binding upon all of Lenders (and such Bank Product Provider). Agent is authorized by Lenders, without necessity of any notice to or further consent from any Lender, from time to time, to take any action with respect to any Collateral or Loan Documents which may be necessary to perfect and maintain perfected the security interest in and Liens upon Collateral pursuant to the Loan Documents.

15.16 Audits and Examination Reports; Confidentiality; Disclaimers by Lenders; Other Reports and Information. By becoming a party to this Agreement, each Lender:

(a) is deemed to have requested that Agent furnish such Lender, promptly after it becomes available, a copy of each field audit or examination report respecting Parent or its Subsidiaries (each, a “Report”) prepared by or at the request of Agent, and Agent shall so furnish each Lender with such Reports,

(b) expressly agrees and acknowledges that Agent does not (i) make any representation or warranty as to the accuracy of any Report, and (ii) shall not be liable for any information contained in any Report,

(c) expressly agrees and acknowledges that the Reports are not comprehensive audits or examinations, that Agent or other party performing any audit or examination will inspect only specific information regarding Parent and its Subsidiaries and will rely significantly upon Parent’s and its Subsidiaries’ books and records, as well as on representations of Borrower’s personnel,

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(d) agrees to keep all Reports and other non-public information regarding Parent and its Subsidiaries and their operations, assets, and existing and contemplated business plans in a confidential manner in accordance with Section 17.9, and

(e) without limiting the generality of any other indemnification provision contained in this Agreement, agrees: (i) to hold Agent and any other Lender preparing a Report harmless from any action the indemnifying Lender may take or fail to take or any conclusion the indemnifying Lender may reach or draw from any Report in connection with any loans or other credit accommodations that the indemnifying Lender has made or may make to Borrower, or the indemnifying Lender’s participation in, or the indemnifying Lender’s purchase of, a loan or loans of Borrower, and (ii) to pay and protect, and indemnify, defend and hold Agent, and any such other Lender preparing a Report harmless from and against, the claims, actions, proceedings, damages, costs, expenses, and other amounts (including, attorneys fees and costs) incurred by Agent and any such other Lender preparing a Report as the direct or indirect result of any third parties who might obtain all or part of any Report through the indemnifying Lender.

In addition to the foregoing: (x) any Lender may from time to time request of Agent in writing that Agent provide to such Lender a copy of any report or document provided by Parent or its Subsidiaries to Agent that has not been contemporaneously provided by Parent or such Subsidiary to such Lender, and, upon receipt of such request, Agent promptly shall provide a copy of same to such Lender, (y) to the extent that Agent is entitled, under any provision of the Loan Documents, to request additional reports or information from Parent or its Subsidiaries, any Lender may, from time to time, reasonably request Agent to exercise such right as specified in such Lender’s notice to Agent, whereupon Agent promptly shall request of Borrower the additional reports or information reasonably specified by such Lender, and, upon receipt thereof from Parent or such Subsidiary, Agent promptly shall provide a copy of same to such Lender, and (z) any time that Agent renders to Borrower a statement regarding the Loan Account, Agent shall send a copy of such statement to each Lender.

15.17 Several Obligations; No Liability. Notwithstanding that certain of the Loan Documents now or hereafter may have been or will be executed only by or in favor of Agent in its capacity as such, and not by or in favor of the Lenders, any and all obligations on the part of Agent (if any) to make any credit available hereunder shall constitute the several (and not joint) obligations of the respective Lenders on a ratable basis, according to their respective Revolver Commitments, to make an amount of such credit not to exceed, in principal amount, at any one time outstanding, the amount of their respective Revolver Commitments. Nothing contained herein shall confer upon any Lender any interest in, or subject any Lender to any liability for, or in respect of, the business, assets, profits, losses, or liabilities of any other Lender. Each Lender shall be solely responsible for notifying its Participants of any matters relating to the Loan Documents to the extent any such notice may be required, and no Lender shall have any obligation, duty, or liability to any Participant of any other Lender. Except as provided in Section 15.7, no member of the Lender Group shall have any liability for the acts of any other member of the Lender Group. No Lender shall be responsible to Borrower or any other Person for any failure by any other Lender (or Bank Product Provider) to fulfill its obligations to make

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credit available hereunder, nor to advance for such Lender (or Bank Product Provider) or on its behalf, nor to take any other action on behalf of such Lender (or Bank Product Provider) hereunder or in connection with the financing contemplated herein.

15.18 Intercreditor Agreement. Each Lender (a) consents to the subordination of Liens provided for in the Intercreditor Agreement, (b) agrees that it will be bound by, and will take no actions contrary to, the provisions of the Intercreditor Agreement, (c) authorizes and instructs Agent to enter into the Intercreditor Agreement as Agent on behalf of such holder of Obligations, (d) acknowledges (or is deemed to acknowledge) that a copy of the Intercreditor Agreement was delivered, or made available, to such Lender and that such Lender reviewed the Intercreditor Agreement and (e) authorizes and instructs Agent to enter into amendments, restatements, amendments and restatements of, or to supplement or other wise modify the Intercreditor Agreement or enter into one or more other intercreditor agreements having terms reasonably satisfactory to Agent, from time to time, in connection with the incurrence or Refinancing Indebtedness in respect of secured Permitted Indebtedness.

16. TAXES.

(a) All payments made by or on behalf of a Loan Party hereunder or under any note or other Loan Document will be made without setoff, counterclaim, or other defense. In addition, all such payments will be made free and clear of, and without deduction or withholding for, any present or future Taxes, and in the event any deduction or withholding of Taxes is required, each Loan Party shall comply with the next sentence of this Section 16(a). If any Taxes are so levied or imposed, each Loan Party agrees to timely pay the full amount of such Taxes and such additional amounts as may be necessary (whether or not such Taxes or amounts were correctly or legally imposed or asserted by the relevant Governmental Authority) so that every payment of all amounts due under this Agreement or any Loan Document, including any amount paid pursuant to this Section 16(a) after withholding or deduction for or on account of any Taxes, will not be less than the amount such member of the Lender Group or Underlying Issuer would have received had no such withholding or deduction been made. The Loan Parties will furnish to Agent as promptly as possible after the date the payment of any Tax is due pursuant to applicable law, certified copies of tax receipts issued by the Governmental Authority (or other evidence reasonably acceptable to Agent) evidencing such payment by the Loan Parties. The Loan Parties shall jointly and severally indemnify the Lender Group and the Underlying Issuer, within 10 days after demand therefor, for the full amount of any Taxes (including such amounts described in Section 16(b) and any Taxes imposed or asserted on, or attributable to, amounts payable under this Section) payable or paid by such member of the Lender Group or the Underlying Issuer or required to be withheld or deducted from a payment to such member of the Lender Group or the Underlying Issuer and any reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to the Borrower by the Lender (with a copy to Agent), or by Agent on its own behalf or on behalf of a Lender, shall be conclusive absent manifest error.

(b) The Loan Parties agree to timely pay any present or future stamp, value added, filing, recording, intangible, court or documentary or other similar taxes or any other excise or property taxes, charges, or similar levies that arise from any payment made hereunder

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or from the execution, delivery, performance, registration, recordation, or filing of, from the receipt or perfection of a security interest under, or otherwise with respect to this Agreement or any other Loan Document.

(c) If Borrower is a U.S. Person and if Agent, the Underlying Issuer, a Lender or Participant is entitled to claim an exemption or reduction from United States withholding tax, such Lender or such Participant agrees with and in favor of Agent, to deliver to each of Borrower and Agent (or, in the case of a Participant, to the Lender granting the participation only, and, in the case of Agent, to Borrower only) one of the following before receiving its first payment under this Agreement (all such forms are required to be provided by the beneficial owner of such payments, other than those forms required by Section 16(c)(iv)):

(i) if Agent, such Lender or such Participant is entitled to claim an exemption from United States withholding tax pursuant to the portfolio interest exception, (A) a statement of the Lender or Participant, signed under penalty of perjury, that it is not a (I) a “bank” as described in Section 881(c)(3)(A) of the IRC, (II) a 10% shareholder of Borrower (within the meaning of Section 871(h)(3)(B) of the IRC), or (III) a controlled foreign corporation related to Borrower within the meaning of Section 864(d)(4) of the IRC, and (B) a properly completed and executed Internal Revenue Service Form W-8BEN or Form W-8IMY (with proper attachments);

(ii) if such Agent, such Lender or such Participant is entitled to claim an exemption from, or a reduction of, withholding tax under a United States tax treaty, a properly completed and executed copy of Internal Revenue Service Form W-8BEN;

(iii) if Agent, such Lender or such Participant is entitled to claim that any payment made under this Agreement is exempt from United States withholding tax because it is effectively connected with a United States trade or business of such Lender, a properly completed and executed copy of Internal Revenue Service Form W-8ECI;

(iv) if Agent, such Lender or such Participant is entitled to claim that any payment made under this Agreement is exempt from United States withholding tax because such Lender or such Participant serves as an intermediary, a properly completed and executed copy of Internal Revenue Service Form W-8IMY (with proper attachments); or

(v) a properly completed and executed copy of any other form or forms, including Internal Revenue Service Form W-9, as may be required under the IRC or other laws of the United States as a condition to exemption from, or reduction of, United States withholding or backup withholding tax.

Agent, and each Lender or Participant shall provide new forms (or successor forms) upon the expiration or obsolescence of any previously delivered forms and to promptly notify Agent (or, in the case of a Participant, to the Lender granting the participation only and in the case of Agent, Borrower only) of any change in circumstances which would modify or render invalid any claimed exemption or reduction.

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If a payment made to a Lender under any Loan Document would be subject to U.S. federal withholding tax imposed by FATCA if such Lender were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the IRC, as applicable), such Lender shall deliver to the Borrower and Agent at the time or times prescribed by law and at such time or times reasonably requested by the Borrower or Agent such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the IRC) and such additional documentation reasonably requested by the Borrower or Agent as may be necessary for the Borrower and Agent to comply with their obligations under FATCA and to determine that such Lender has complied with such Lender’s obligations under FATCA or to determine the amount to deduct and withhold from such payment. Solely for purposes of this paragraph, “FATCA” shall include any amendments made to FATCA after the date of this Agreement.

(d) If a Lender or Participant claims an exemption from withholding tax in a jurisdiction other than the United States, such Lender or such Participant agrees with and in favor of Agent, to deliver to each of Borrower and Agent (or, in the case of a Participant, to the Lender granting the participation only) any such form or forms, as may be required under the laws of such jurisdiction as a condition to exemption from, or reduction of, foreign withholding or backup withholding tax before receiving its first payment under this Agreement, but only if such Lender or such Participant is legally able to deliver such forms, provided, however, that nothing in this Section 16(d) shall require a Lender or Participant to disclose any information that it deems to be confidential (including without limitation, its tax returns). Each Lender and each Participant shall provide new forms (or successor forms) upon the expiration or obsolescence of any previously delivered forms and to promptly notify Agent (or, in the case of a Participant, to the Lender granting the participation only) of any change in circumstances which would modify or render invalid any claimed exemption or reduction. Notwithstanding anything to the contrary in the preceding two sentences, the completion, execution and submission of such documentation shall not be required if in the Lender’s reasonable judgment such completion, execution or submission would subject such Lender to any material unreimbursed cost or expense or would materially prejudice the legal or commercial position of such Lender.

(e) If a Lender or Participant claims exemption from, or reduction of, withholding tax and such Lender or such Participant sells, assigns, grants a participation in, or otherwise transfers all or part of the Obligations of Borrower to such Lender or such Participant, such Lender or such Participant agrees to notify Agent (or, in the case of a sale of a participation interest, to the Lender granting the participation only) of the percentage amount in which it is no longer the beneficial owner of Obligations of Borrower to such Lender or such Participant. To the extent of such percentage amount, Agent will treat such Lender’s or such Participant’s documentation provided pursuant to Section 16(c) or 16(d) as no longer valid. With respect to such percentage amount, such Participant or Assignee may provide new documentation, pursuant to Section 16(c) or 16(d), if applicable. Borrower agrees that each Participant shall be entitled to the benefits of this Section 16 with respect to its participation in any portion of the Revolver Commitments and the Obligations so long as such Participant complies with the obligations set forth in this Section 16 with respect thereto.

(f) Without limiting the obligations of the Loan Parties under Section 16(a), if a Lender or a Participant is entitled to a reduction in the applicable withholding tax, Borrower

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and Agent (or, in the case of a Participant, to the Lender granting the participation) may withhold from any interest payment to such Lender or such Participant an amount equivalent to the applicable withholding tax after taking into account such reduction. If the forms or other documentation required by Section 16(c) or 16(d) are not delivered to Agent (or, in the case of a Participant, to the Lender granting the participation), then Agent (or, in the case of a Participant, to the Lender granting the participation) may withhold from any interest payment to such Lender or such Participant not providing such forms or other documentation an amount equivalent to the applicable withholding tax.

(g) Each Lender shall severally indemnify Agent, within 10 days after demand therefor, for (i) any Taxes attributable to such Lender (but only to the extent that any Loan Party has not already indemnified Agent for such Taxes and without limiting the obligation of the Loan Party to do so), (ii) any taxes attributable to such Lender’s failure to comply with the provisions of Section 13 relating to the maintenance of a Participant Register and (iii) any taxes that are not included in the definition of Taxes attributable to such Lender, in each case, that are payable or paid by Agent in connection with any Loan Document, and any reasonable expenses (including interest and penalties) arising therefrom or with respect thereto, whether or not such taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to any Lender by Agent shall be conclusive absent manifest error. Each member of the Lender Group and the Underlying Issuer hereby authorizes Agent to set off and apply any and all amounts at any time owing to the member of the Lender Group or the Underlying Issuer under any Loan Document or otherwise payable by Agent to the Lender from any other source against any amount due to Agent under this paragraph (g).

(h) If Agent or a Lender determines, in its sole discretion, that it has received a refund of any Taxes as to which it has been indemnified by Borrower or with respect to which Borrower has paid additional amounts pursuant to this Section 16, so long as no Default or Event of Default has occurred and is continuing, it shall pay over such refund to Borrower (but only to the extent of payments made, or additional amounts paid, by Borrower under this Section 16 with respect to Taxes giving rise to such a refund), net of all out-of-pocket expenses of Agent or such Lender and without interest (other than any interest paid by the relevant Governmental Authority with respect to such a refund); provided, that Borrower, upon the request of Agent or such Lender, agrees to repay the amount paid over to Borrower (plus any penalties, interest or other charges, imposed by the relevant Governmental Authority, other than such penalties, interest or other charges imposed as a result of the willful misconduct or gross negligence of Agent hereunder) to Agent or such Lender in the event Agent or such Lender is required to repay such refund to such Governmental Authority. Notwithstanding anything to the contrary in this paragraph (h), in no event will the indemnified party be required to pay any amount to an indemnifying party pursuant to this paragraph (h) the payment of which would place the indemnified party in a less favorable net after-tax position than the indemnified party would have been in if the indemnification payments or additional amounts giving rise to such refund had never been paid. Notwithstanding anything in this Agreement to the contrary, this Section 16 shall not be construed to require Agent or any Lender to make available its tax returns (or any other information which it deems confidential) to Borrower or any other Person.

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17. GENERAL PROVISIONS.

17.1 Effectiveness. This Agreement shall be binding and deemed effective when executed by Parent, Borrower, Agent, and each Lender whose signature is provided for on the signature pages hereof.

17.2 Section Headings. Headings and numbers have been set forth herein for convenience only. Unless the contrary is compelled by the context, everything contained in each Section applies equally to this entire Agreement.

17.3 Interpretation. Neither this Agreement nor any uncertainty or ambiguity herein shall be construed against the Lender Group or any Loan Party, whether under any rule of construction or otherwise. On the contrary, this Agreement has been reviewed by all parties and shall be construed and interpreted according to the ordinary meaning of the words used so as to accomplish fairly the purposes and intentions of all parties hereto.

17.4 Severability of Provisions. Each provision of this Agreement shall be severable from every other provision of this Agreement for the purpose of determining the legal enforceability of any specific provision.

17.5 Bank Product Providers. Each Bank Product Provider shall be deemed a third party beneficiary hereof and of the provisions of the other Loan Documents for purposes of any reference in a Loan Document to the parties for whom Agent is acting. Agent hereby agrees to act as agent for such Bank Product Providers and, by virtue of entering into a Bank Product Agreement, the applicable Bank Product Provider shall be automatically deemed to have appointed Agent as its agent and to have accepted the benefits of the Loan Documents; it being understood and agreed that the rights and benefits of each Bank Product Provider under the Loan Documents consist exclusively of such Bank Product Provider’s being a beneficiary of the Liens and security interests (and, if applicable, guarantees) granted to Agent and the right to share in payments and collections out of the Collateral as more fully set forth herein. In addition, each Bank Product Provider, by virtue of entering into a Bank Product Agreement, shall be automatically deemed to have agreed that Agent shall have the right, but shall have no obligation, to establish, maintain, relax, or release reserves in respect of the Bank Product Obligations and that if reserves are established there is no obligation on the part of Agent to determine or insure whether the amount of any such reserve is appropriate or not. In connection with any such distribution of payments or proceeds of Collateral, Agent shall be entitled to assume no amounts are due or owing to any Bank Product Provider unless such Bank Product Provider has provided a written certification (setting forth a reasonably detailed calculation) to Agent as to the amounts that are due and owing to it and such written certification is received by Agent a reasonable period of time prior to the making of such distribution. Agent shall have no obligation to calculate the amount due and payable with respect to any Bank Products, but may rely upon the written certification of the amount due and payable from the relevant Bank Product Provider. In the absence of an updated certification, Agent shall be entitled to assume that the amount due and payable to the relevant Bank Product Provider is the amount last certified to Agent by such Bank Product Provider as being due and payable (less any distributions made to such Bank Product Provider on account thereof). The Loan Parties may obtain Bank Products from any Bank Product Provider, although they are not required to do so. Parent and Borrower

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acknowledge and agree that no Bank Product Provider has committed to provide any Bank Products and that the providing of Bank Products by any Bank Product Provider is in the sole and absolute discretion of such Bank Product Provider. Notwithstanding anything to the contrary in this Agreement or any other Loan Document, no provider or holder of any Bank Product shall have any voting or approval rights hereunder (or be deemed a Lender) or under any other Loan Document solely by virtue of its status as the provider or holder of such agreements or products or the Obligations owing thereunder, nor shall the consent of any such provider or holder be required (other than in their capacities as Lenders, to the extent applicable) for any matter hereunder or under any of the other Loan Documents, including as to any matter relating to the Collateral or the release of Collateral or Guarantors.

17.6 Debtor-Creditor Relationship. The relationship between Lenders and Agent, on the one hand, and the Loan Parties, on the other hand, is solely that of creditor and debtor. No member of the Lender Group has (or shall be deemed to have) any fiduciary relationship or duty to any Loan Party arising out of or in connection with the Loan Documents or the Transactions or any transactions contemplated thereby, and there is no agency or joint venture relationship between the members of the Lender Group, on the one hand, and the Loan Parties, on the other hand, by virtue of any Loan Document or any transaction contemplated therein.

17.7 Counterparts; Electronic Execution. This Agreement may be executed in any number of counterparts and by different parties on separate counterparts, each of which, when executed and delivered, shall be deemed to be an original, and all of which, when taken together, shall constitute but one and the same Agreement. Delivery of an executed counterpart of this Agreement by facsimile or other electronic method of transmission (including Adobe portable document format (.pdf)) shall be equally as effective as delivery of an original executed counterpart of this Agreement. Any party delivering an executed counterpart of this Agreement by facsimile or other electronic method of transmission also shall deliver an original executed counterpart of this Agreement but the failure to deliver an original executed counterpart shall not affect the validity, enforceability, and binding effect of this Agreement. The foregoing shall apply to each other Loan Document mutatis mutandis.

17.8 Revival and Reinstatement of Obligations. If the incurrence or payment of the Obligations by Borrower or Guarantors or the transfer to the Lender Group of any property should for any reason subsequently be asserted, or declared, to be void or voidable under any state or federal law relating to creditors’ rights, including provisions of the Bankruptcy Code relating to fraudulent conveyances, preferences, or other voidable or recoverable payments of money or transfers of property (each, a “Voidable Transfer”), and if the Lender Group is required to repay or restore, in whole or in part, any such Voidable Transfer, or elects to do so upon the advice of counsel, then, as to any such Voidable Transfer, or the amount thereof that the Lender Group is required or elects to repay or restore, and as to all reasonable costs, expenses, and attorneys fees of the Lender Group related thereto, the liability of Borrower or such Guarantor automatically shall be revived, reinstated, and restored and shall exist as though such Voidable Transfer had never been made.

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17.9 Confidentiality.

(a) Agent and Lenders each individually (and not jointly or jointly and severally) agree that information regarding Parent and its Subsidiaries, their operations, assets, and existing and contemplated business plans (“Confidential Information”) shall be treated by Agent and Lenders in a confidential manner, and shall not be disclosed by Agent and Lenders to Persons who are not parties to this Agreement, except: (i) to attorneys for and other advisors, accountants, auditors, and consultants to any member of the Lender Group and to employees, directors and officers of any member of the Lender Group (the Persons in this clause (i), “Lender Group Representatives”) on a “need to know” basis in connection with this Agreement and the Transactions or any transactions contemplated hereby and on a confidential basis, (ii) to Subsidiaries and Affiliates of any member of the Lender Group (including the Bank Product Providers), provided that any such Subsidiary or Affiliate shall have agreed to receive such information hereunder subject to the terms of this Section 17.9, (iii) as may be required by regulatory authorities purporting to have legal authority to regulate the business and operations of such member of the Lender Group or its Affiliates so long as such authorities are informed of the confidential nature of such information, (iv) as may be required by statute, decision, or judicial or administrative order, rule, or regulation; provided that (x) prior to any disclosure under this clause (iv), the disclosing party shall provide Borrower with prior notice thereof, to the extent that it is practicable to do so and to the extent that the disclosing party is permitted to provide such prior notice to Borrower pursuant to the terms of the applicable statute, decision, or judicial or administrative order, rule, or regulation and (y) any disclosure under this clause (iv) shall be limited to the portion of the Confidential Information as may be required by such statute, decision, or judicial or administrative order, rule, or regulation, (v) as may be agreed to in advance in writing by Borrower, (vi) as requested or required by any Governmental Authority pursuant to any subpoena or other legal process, provided, that, (x) prior to any disclosure under this clause (vi) the disclosing party agrees to provide Borrower with prior written notice thereof, to the extent that it is practicable to do so and to the extent that the disclosing party is permitted to provide such prior written notice to Borrower pursuant to the terms of the subpoena or other legal process and (y) any disclosure under this clause (vi) shall be limited to the portion of the Confidential Information as may be required by such Governmental Authority pursuant to such subpoena or other legal process, (vii) as to any such information that is or becomes generally available to the public (other than as a result of prohibited disclosure by Agent or Lenders or the Lender Group Representatives), (viii) in connection with any assignment, participation or pledge of any Lender’s interest under this Agreement, provided that prior to receipt of Confidential Information any such assignee, participant, or pledgee shall have agreed in writing to receive such Confidential Information hereunder subject to the terms of this Section, (ix) in connection with any litigation or other adversary proceeding involving parties hereto which such litigation or adversary proceeding involves claims related to the rights or duties of such parties under this Agreement or the other Loan Documents; provided, that, prior to any disclosure to any Person (other than any Loan Party, Agent, any Lender, any of their respective Affiliates, or their respective counsel) under this clause (ix) with respect to litigation involving any Person (other than Borrower, Agent, any Lender, any of their respective Affiliates, or their respective counsel), the disclosing party agrees to provide Borrower with prior written notice thereof, and (x) in connection with, and to the extent reasonably necessary for, the exercise of any secured creditor remedy under this Agreement or under any other Loan Document.

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(b) Anything in this Agreement to the contrary notwithstanding, Agent may (i) provide customary information concerning the terms and conditions of this Agreement and the other Loan Documents to loan syndication and pricing reporting services, and (ii) use the name, logos, and other insignia of Borrower and the Loan Parties and the Revolver Commitments provided hereunder in any “tombstone” or comparable advertising, on its website or in other marketing materials of Agent.

17.10 Lender Group Expenses. Borrower agrees to pay the Lender Group Expenses on the earlier of (a) the first day of the month following the date on which such Lender Group Expenses were first incurred or (b) the date on which written demand therefor, together with reasonably detailed documentation thereof, is made by Agent. Borrower agrees that its obligations contained in this Section 17.10 shall survive payment or satisfaction in full of all other Obligations.

17.11 Survival. All representations and warranties made by the Loan Parties in the Loan Documents and in the certificates or other instruments delivered in connection with or pursuant to this Agreement or any other Loan Document shall be considered to have been relied upon by the other parties hereto and shall survive the execution and delivery of the Loan Documents and the making of any loans and issuance of any Letters of Credit, regardless of any investigation made by any such other party or on its behalf and notwithstanding that Agent, the Issuing Lender, or any Lender may have had notice or knowledge of any Default or Event of Default or incorrect representation or warranty at the time any credit is extended hereunder, and shall continue in full force and effect as long as the principal of or any accrued interest on any loan or any fee or any other amount payable under this Agreement is outstanding and unpaid or any Letter of Credit is outstanding and so long as the Revolver Commitments have not expired or terminated.

17.12 Patriot Act. Each Lender that is subject to the requirements of the Patriot Act hereby notifies Borrower that pursuant to the requirements of the Patriot Act, it is required to obtain, verify and record information that identifies Borrower, which information includes the name and address of Borrower and other information that will allow such Lender to identify Borrower in accordance with the Patriot Act. In addition, if Agent is required by law or regulation or internal policies to do so, it shall have the right to periodically conduct (a) Patriot Act searches, OFAC/PEP searches, and customary individual background checks for the Loan Parties and (b) OFAC/PEP searches and customary individual background checks for the Loan Parties’ senior management and key principals, and Borrower agrees to cooperate in respect of the conduct of such searches and further agrees that the reasonable out-of-pocket costs and expenses for such searches shall constitute Lender Group Expenses hereunder.

17.13 Integration. This Agreement, together with the other Loan Documents, reflects the entire understanding of the parties with respect to the Transactions or any transactions contemplated hereby and shall not be contradicted or qualified by any other agreement, oral or written, before the date hereof. The foregoing to the contrary notwithstanding, all Bank Product Agreements, if any, are independent agreements governed by the written provisions of such Bank Product Agreements, which will remain in full force and effect, unaffected by any repayment, prepayments, acceleration, reduction, increase, or change in the terms of any credit extended hereunder, except as provided in such Bank Product Agreement.

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[Signature pages to follow.]

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

HORIZON LINES, INC.,

as Parent

By:

Title:

HORIZON LINES, LLC,

as Borrower.

By:

Title:

Horizon Lines, Inc.

Credit Agreement

WELLS FARGO CAPITAL FINANCE, LLC,

as Agent and as a Lender

By:

Title:

Horizon Lines, Inc.

Credit Agreement

Schedule 1.1

Definitions

As used in the Agreement, the following terms shall have the following definitions:

“ABL Priority Collateral” has the meaning specified therefor in the Intercreditor Agreement.

“Account” means an account (as that term is defined in the Code).

“Account Debtor” means any Person who is obligated on an Account, chattel paper, or a general intangible.

“Accounting Changes” means changes in accounting principles required by the promulgation of any rule, regulation, pronouncement or opinion by the Financial Accounting Standards Board of the American Institute of Certified Public Accountants (or successor thereto or any agency with similar functions).

“Acquired Indebtedness” means Indebtedness of a Person whose assets or Stock is acquired by Parent or any of its Subsidiaries in a Permitted Acquisition; provided, however, that such Indebtedness (a) is either Purchase Money Indebtedness or a Capital Lease with respect to Equipment or mortgage financing with respect to Real Property, (b) was in existence prior to the date of such Permitted Acquisition, and (c) was not incurred in connection with, or in contemplation of, such Permitted Acquisition.

“Acquisition” means (a) the purchase or other acquisition by a Person or its Subsidiaries of all or substantially all of the assets of (or any division or business line of) any other Person, or (b) the purchase or other acquisition (whether by means of a merger, consolidation, or otherwise) by a Person or its Subsidiaries of all or substantially all of the Stock of any other Person.

“Additional Documents” has the meaning specified therefor in Section 5.12 of the Agreement.

“Additional Notes” has the meaning specified therefor in the applicable Secured Notes Documents as in effect on the Closing Date.

“Adjusted EBITDA” means, with respect to any fiscal period (in each case, determined on a consolidated basis in accordance with GAAP and, in each case, without duplication):

(a) Parent’s consolidated net earnings (or loss) for such period,

minus

(b) the sum of the following amounts of Parent for such period to the extent included in determining consolidated net earnings (or loss) for such period:

(i) extraordinary, unusual, or non-recurring gains,

1

(ii) interest income,

(iii) tax benefit or credit,

(iv) exchange, translation or performance gains relating to any hedging transactions or foreign currency fluctuations,

(v) income arising by reason of the application of FAS 141R,

(vi) the gain from the reversal in the fiscal month ending May 22, 2011 of $19,200,000 of the $30,000,000 charge recorded in the fiscal month ending December 26, 2010 for the present value of the original $45,000,000 fine resulting from the settlement of the Antitrust Investigation (which such $19,200,000 gain resulted from the reduction of the fine from $45,000,000 to $15,000,000) pursuant to the Antitrust Judgment,

(vii) earnings, to the extent such exists, contributed by the Non-Domestic Service,

(viii) earnings, to the extent such exists, contributed by the TP1 Service, and

(ix) non-cash charges and non-cash expenses previously added back to Parent’s consolidated net earnings (or loss) in determining Adjusted EBITDA pursuant to clauses (c)(i), (c)(ii), (c)(viii), (c)(ix), (c)(xi), (c)(xii), (c)(xiv), (c)(xv) and (c)(xvi), below to the extent such non-cash charges and non-cash expenses have become cash charges and cash expenses during such period,

plus

(c) the sum of the following amounts of Parent for such period to the extent included in determining consolidated net earnings (or loss) for such period:

(i) non-cash extraordinary, unusual, impairment, or non-recurring losses,

(ii) other non-cash charges or non-cash expenses, in each case incurred other than in the ordinary course of business,

(iii) interest expense,

(iv) tax expense based on income, profits or capital, including federal, foreign, state, franchise and similar taxes (including tonnage taxes) (and for the avoidance of doubt, specifically excluding any sales taxes or any other taxes held in trust for, or on behalf of, a Governmental Authority),

2

(v) depreciation and amortization,

(vi) non-cash compensation expense (including deferred non-cash compensation expense), or other non-cash expenses or charges, arising from the sale or issuance of stock, the granting of stock options, and the granting of stock appreciation rights, restricted stock and similar arrangements (including any re-pricing, amendment, modification, substitution, or change of any such stock, stock option, stock appreciation rights, or similar arrangements) minus the amount of any such expenses or charges when paid in cash to the extent not deducted in the computation of Parent’s consolidated net earnings (or loss),

(vii) expenses incurred as a result of the repurchase, redemption or retention of Capital Stock earned under equity compensation programs solely in order to make withholding tax payments in an aggregate amount not to exceed $1,500,000 in any fiscal year,

(viii) non-cash restructuring charges unrelated to the Non-Domestic Reorganization,

(ix) non-cash fees, expenses or charges incurred other than in the ordinary course of business associated with changes in the method of operations pursuant to cost reduction programs,

(x) Non-Domestic Reorganization Charges in an aggregate amount not to exceed $35,000,000 in the fourth fiscal quarter of fiscal year 2011 and the first fiscal quarter of 2012,

(xi) non-cash exchange, translation or performance losses relating to any hedging transactions or foreign currency fluctuations,

(xii) non-cash losses on sales of fixed or other tangible assets or write-downs of fixed, other tangible or intangible assets,

(xiii) Recapitalization Costs in an aggregate amount not to exceed $2,500,000 in fiscal year 2011,

(xiv) any amortization of debt discount, premium and deferred financing costs or write-off of financing costs, including but not limited to non-cash expense or loss associated with the early retirement or extinguishment of debt,

(xv) non-cash loss on modification of debt,

(xvi) non-cash charges resulting from the application of purchase accounting,

(xvii) charges recorded for the fine resulting from the settlement of the Antitrust Investigation in aggregate amount not exceed $15,000,000 over the period beginning with the fiscal month ending December 26, 2010 and ending March 24, 2016,

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(xviii) charges for such period relating to the lawsuits of claimants that opted out of the class action lawsuits subject to the Puerto Rico Settlement in an aggregate amount not to exceed $25,000,000 during the term of this Agreement,

(xix) charges for such period relating to the Indirect Purchasers Settlement in an aggregate amount not to exceed $1,800,000 during the term of this Agreement,

(xx) legal and professional fees and expenses incurred during such period relating to Antitrust Litigation Matters in an aggregate amount not to exceed (A) $7,500,000 during any twelve-month period and (B) $7,500,000 incurred after the Closing Date during the term of this Agreement,

(xxi) charges for the settlement of, and legal and professional fees and expenses incurred during such period relating to, the investigation into environmental compliance recordkeeping in an aggregate amount not to exceed $3,500,000 during the term of this Agreement,

(xxii) Non-Domestic Service losses for the period prior to the commencement of the Non-Domestic Reorganization in the amounts and for the periods set forth in the Non-Domestic Service Losses Schedule in an aggregate amount not to exceed $35,800,000 in fiscal year 2011;

(xxiii) Non-Domestic Service losses for the period after the commencement of the Non-Domestic Reorganization in an aggregate amount not to exceed (A) $10,000,000 in any fiscal quarter and (B) $25,000,000 during the term of this Agreement, and

(xxiv) TP1 Service losses in an aggregate amount not to exceed $1,500,000 for fiscal year 2011.

“Advances” means Revolver Loans (including Revolver Loans that result in an Overadvance), Swing Loans and Protective Advances, or any one of them, as the context may require.

“Affected Lender” has the meaning specified therefor in Section 2.13(b) of the Agreement.

“Affiliate” means, as applied to any Person, any other Person who controls, is controlled by, or is under common control with, such Person. For purposes of this definition, “control” means the possession, directly or indirectly through one or more intermediaries, of the power to direct the management and policies of a Person, whether through the ownership of Stock, by contract, or otherwise; provided, however, that, for purposes of the definition of Eligible Accounts and Section 6.12 of the Agreement: (a) any Person which owns directly or indirectly 10% or more of the Stock having ordinary voting power for the election of directors or other members of the governing body of a Person or 10% or more of the partnership or other ownership interests of a Person (other than as a limited partner of such Person) shall be deemed an Affiliate of such Person, (b) each director (or comparable manager) of a Person shall be deemed to be an Affiliate of such Person, and (c) each partnership in which a Person is a general partner shall be deemed an Affiliate of such Person.

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“Agent” has the meaning specified therefor in the preamble to the Agreement.

“Agent-Related Persons” means Agent, together with its Affiliates (including the Issuing Lender and the Swing Lender), officers, directors, employees, attorneys, and agents.

“Agent’s Account” means the Deposit Account of Agent identified on Schedule A-1.

“Agent’s Liens” means the Liens granted by each of the Loan Parties to Agent under the Loan Documents.

“Agreement” means the Credit Agreement to which this Schedule 1.1 is attached.

“Antitrust Investigation” means the investigation by the Antitrust Division of the United States Department of Justice regarding possible antitrust violations by the Loan Parties or their Subsidiaries with respect to the ocean shipping business.

“Antitrust Judgment” has the meaning specified therefor in the definition of Antitrust Judgment Lien.

“Antitrust Judgment Lien” means the Lien securing the obligations of Parent and its Subsidiaries with respect to that certain Second Amended Judgment (the “Antitrust Judgment”) entered by the United States District Court for the Judicial District of Puerto Rico on April 28, 2011 in the case of United States of America v. Horizon Lines, LLC (Case Number 03:11-CR-0071-001 (DRD)) (a notice of which was recorded in favor of the United States of America in the Register of Deeds for Mecklenburg County, North Carolina on June 07, 2011), pursuant to which judgment Borrower is required to pay over a period of 5 years, the following amounts by the following dates: (i) $1,000,000 on or before May 28, 2011, (ii) $1,000,000 on or before March 22, 2012, (iii) $2,000,000 on or before March 22, 2013, (iv) $3,000,000 on or before March 22, 2014, (v) $4,000,000 on or before March 22, 2015, and (vi) $4,000,000 on or before March 22, 2016.

“Antitrust Litigation Matters” means any civil action, criminal action or investigation, including related shareholder litigation, involving any allegation of a violation of federal, state or other antitrust law by any of the Loan Parties or their Subsidiaries with respect to the ocean shipping business.

“Application Event” means the occurrence of (a) a failure by Borrower to repay all of the Obligations (other than Contingent Obligations) in full on the Maturity Date, or (b) an Event of Default and the election by Agent or the Required Lenders to require that payments and proceeds of Collateral be applied pursuant to Section 2.4(b)(ii) of the Agreement.

“Applicable Leverage Premium” means, as of any date of determination, the applicable premium set forth in the following table that corresponds to the most recent calculation of the Leverage Ratio delivered to Agent pursuant to Section 5.1 of the Agreement

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(the “Leverage Ratio Calculation”); provided that for the period from the Closing Date through the date Agent receives the Leverage Ratio Calculation in respect of the Reference Period ending December 25, 2011, the Applicable Leverage Premium shall be set at “Level IV”:

Level	Leverage Ratio	Leverage Premium
I	< 4.00 to 1.00		0.00	%
II	³ 4.00 to 1.00 but < 5.00 to 1.00		0.25	%
III	³ 5.00 to 1.00 but < 6.00 to 1.00		0.50	%
IV	³ 6.00 to 1.00		0.75	%

Except as set forth in the foregoing proviso, the Applicable Leverage Premium shall be based upon the most recent Leverage Ratio Calculation, which will be calculated as of the end of each fiscal month for the most recently ended 12 month period. Except as set forth in the proviso to the first sentence of this definition, the Applicable Leverage Premium shall be re-determined monthly on the first day of the calendar month following the date of delivery to Agent of the certified calculation thereof pursuant to Section 5.1 of the Agreement; provided, however, that if Parent fails to provide such certification when such certification is due, the Applicable Leverage Premium shall be set at “Level IV” as of the first day of the calendar month following the date on which the certification was required to be delivered until the date on which such certification or a subsequent month’s certification is delivered (on which date (but not retroactively), without constituting a waiver of any Default or Event of Default occasioned by the failure to timely deliver such certification, the Applicable Leverage Premium shall be set at the Level based upon the calculations disclosed by such certification). In the event that the information regarding the Leverage Ratio contained in any certificate delivered pursuant to Section 5.1 of the Agreement is shown to be inaccurate, and such inaccuracy, if corrected, would have led to the application of a higher Applicable Leverage Premium for any period (a “Margin Period”) than the Applicable Leverage Premium actually applied for such Margin Period, then (i) Parent shall promptly deliver to Agent a correct certificate for such Margin Period, (ii) the Applicable Leverage Premium shall be determined as if the correct Applicable Leverage Premium (as set forth in the table above) were applicable for such Margin Period, and (iii) Parent shall promptly deliver to Agent full payment in respect of the accrued additional interest as a result of such increased Applicable Leverage Premium for such Margin Period, which payment shall be promptly applied by Agent to the affected Obligations.

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“Applicable Margin” means, as of any date of determination, the sum of (a) the applicable margin set forth in the following table that corresponds to the most recent calculation of Average Three-Month Excess Availability delivered to Agent pursuant to Section 5.1 of the Agreement (the “Excess Availability Calculation”) plus (b) the Applicable Leverage Premium; provided that for the period from the Closing Date through the date Agent receives the Excess Availability Calculation in respect of the Reference Period ending December 25, 2011, the Applicable Margin shall be calculated based on “Level II”:

Level	Average Three- Month Excess Availability	LIBOR Rate Loans			Base Rate Loans
I	> $60,000,000		2.25	%		1.25	%
II	£ $60,000,000 but > $45,000,000		2.50	%		1.50	%
III	£ $45,000,000 but > $30,000,000		2.75	%		1.75	%
IV	£ $30,000,000		3.00	%		2.00	%

Except as set forth in the foregoing proviso, the Applicable Margin shall be based upon the most recent Excess Availability Calculation, which will be calculated as of the end of each fiscal month. Except as set forth in the proviso to the first sentence of this definition, the Applicable Margin shall be re-determined monthly on the first day of the calendar month following the date of delivery to Agent of the certified calculation of the Average Three-Month Excess Availability pursuant to Section 5.1 of the Agreement; provided, however, that if Parent fails to provide such certification when such certification is due, the Applicable Margin shall be set at “Level IV” as of the first day of the calendar month following the date on which the certification was required to be delivered until the date on which such certification or a subsequent month’s certification is delivered (on which date (but not retroactively), without constituting a waiver of any Default or Event of Default occasioned by the failure to timely deliver such certification, the Applicable Margin shall be set at the Level based upon the calculations disclosed by such certification). In the event that the information regarding the Average Three-Month Excess Availability contained in any certificate delivered pursuant to Section 5.1 of the Agreement is shown to be inaccurate, and such inaccuracy, if corrected, would have led to the application of a higher Applicable Margin for any period (a “Margin Period”) than the Applicable Margin actually applied for such Margin Period, then (i) Parent shall promptly deliver to Agent a correct certificate for such Margin Period, (ii) the Applicable Margin shall be determined as if the correct Applicable Margin (as set forth in the table above) were applicable for such Margin Period, and (iii) Parent shall promptly deliver to Agent full payment in respect of the accrued additional interest as a result of such increased Applicable Margin for such Margin Period, which payment shall be promptly applied by Agent to the affected Obligations.

“Assignee” has the meaning specified therefor in Section 13.1(a) of the Agreement.

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“Assignment and Acceptance” means an Assignment and Acceptance Agreement substantially in the form of Exhibit A-1.

“Authorized Person” means any one of the individuals identified on Schedule A-2, as such schedule is updated from time to time by written notice from Parent to Agent.

“Average Three-Month Excess Availability” means for any consecutive three month period, an amount equal to the sum of the actual amount of Excess Availability on each day during such three-month period, as calculated by Borrower subject to confirmation by Agent, divided by the number of days in such three-month period.

“Bank Product” means any one or more of the following financial products or accommodations extended to a Loan Party by a Bank Product Provider: (a) credit cards, (b) credit card processing services, (c) debit cards, (d) stored value cards, (e) purchase cards (including so-called “procurement cards” or “P-cards”), (f) Cash Management Services, or (g) transactions under Hedge Agreements.

“Bank Product Agreements” means those agreements entered into from time to time by a Loan Party with a Bank Product Provider in connection with the obtaining of any of the Bank Products.

“Bank Product Collateralization” means providing cash collateral (pursuant to documentation reasonably satisfactory to Agent) to be held by Agent for the benefit of the Bank Product Providers (other than the Hedge Providers) in an amount determined by Agent as sufficient to satisfy the reasonably estimated credit exposure with respect to then existing Noticed Bank Product Obligations (other than Hedge Obligations).

“Bank Product Obligations” means (a) all obligations, liabilities, reimbursement obligations, fees, or expenses owing to any Bank Product Provider pursuant to or evidenced by a Bank Product Agreement and irrespective of whether for the payment of money, whether direct or indirect, absolute or contingent, due or to become due, now existing or hereafter arising and (b) all Hedge Obligations.

“Bank Product Provider” means any Lender or any of its Affiliates; provided that if, at any time, a Lender ceases to be a Lender under the Agreement, then, from and after the date on which it ceases to be a Lender thereunder, neither it nor any of its Affiliates shall constitute Bank Product Providers and the obligations with respect to Bank Products provided by such former Lender or any of its Affiliates shall no longer constitute Bank Product Obligations.

“Bank Products Provider Agreement” means a letter agreement in substantially the form attached hereto as Exhibit B-2, in form and substance reasonably satisfactory to Agent, duly executed by the applicable Bank Product Provider, Borrower, and Agent.

“Bank Product Reserve Amount” means, as of any date of determination, the Dollar amount of reserves that Agent has determined is necessary or appropriate to establish in its Permitted Discretion in respect of Bank Product Obligations then provided or outstanding.

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“Bankruptcy Code” means title 11 of the United States Code, as in effect from time to time.

“Base Rate” means, for any day, a per annum rate equal to the greatest of (a) the Federal Funds Rate plus  ¹/2%, (b) the LIBOR Rate (which rate shall be calculated based upon an Interest Period of 1 month and shall be determined on a daily basis), plus 1%, and (c) the rate of interest announced, from time to time, within Wells Fargo at its principal office in San Francisco as its “prime rate”, with the understanding that the “prime rate” is one of Wells Fargo’s base rates (not necessarily the lowest of such rates) and serves as the basis upon which effective rates of interest are calculated for those loans making reference thereto and is evidenced by the recording thereof after its announcement in such internal publications as Wells Fargo may designate.

“Base Rate Loan” means each portion of the Advances that bears interest at a rate determined by reference to the Base Rate.

“Board of Directors” means the board of directors (or comparable managers) of Parent or any committee thereof duly authorized to act on behalf of the board of directors (or comparable managers).

“Borrower” has the meaning specified therefor in the preamble to the Agreement.

“Borrowing” means a borrowing consisting of Revolver Loans made on the same day by the Lenders (or Agent on behalf thereof), or by Swing Lender in the case of a Swing Loan, or by Agent in the case of a Protective Advance.

“Borrowing Base” means, as of any date of determination, the result of (a) 85% of the amount of Eligible Accounts; less (b) the aggregate amount of reserves, if any, established by Agent in its Permitted Discretion under Section 2.1(c) of the Agreement.

“Borrowing Base Certificate” means a certificate in the form of Exhibit B-1.

“Borrowing Base Excess” has the meaning specified therefor in Section 2.4(e)(i).

“Bridge Credit Agreement” means that certain Second Lien Term Loan Facility, dated as of September 13, 2011, among Parent, as borrower, certain Subsidiaries of Parent as guarantors, the banks and other financial institutions party thereto, as lenders, and Cantor Fitzgerald Securities, as administrative agent for the lenders thereunder, as amended.

“Business Day” means any day that is not a Saturday, Sunday, or other day on which banks are authorized or required to close in the state of New York, except that, if a determination of a Business Day shall relate to a LIBOR Rate Loan, the term “Business Day” also shall exclude any day on which banks are closed for dealings in Dollar deposits in the London interbank market.

“Capital Expenditures” means, with respect to any Person for any period, the aggregate of all expenditures by such Person and its Subsidiaries during such period that are capital expenditures as determined in accordance with GAAP, whether such expenditures are

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paid in cash or financed; provided that the following shall not be considered Capital Expenditures (a) expenditures as a result of a trade-in or reinvestment of proceeds of an asset disposition, (b) expenditures using proceeds of insurance or condemnation event proceeds, (c) expenditures made to effect a Permitted Acquisition, (d) expenditures resulting from a reinvestment in accordance with Section 2.4(e)(ii), (e) expenditures financed solely with net cash proceeds from an issuance of Stock, (f) expenditures made as a tenant in leasehold improvements, to the extent reimbursed by the landlords and (g) expenditures actually paid for by a third party (excluding any Loan Party or any Subsidiary thereof) and for which no Loan Party or any Subsidiary has provided or is required to provide or incur, directly or indirectly, and consideration or monetary obligation to such third party or any other Person (whether before, during or after such period).

“Capitalized Lease Obligation” means that portion of the obligations under a Capital Lease that is required to be capitalized in accordance with GAAP.

“Capital Lease” means a lease that is required to be capitalized for financial reporting purposes in accordance with GAAP.

“Cash Equivalents” means (a) marketable direct obligations issued by, or unconditionally guaranteed by, the United States or issued by any agency thereof and backed by the full faith and credit of the United States, in each case maturing within 1 year from the date of acquisition thereof, (b) marketable direct obligations issued or fully guaranteed by any state of the United States or any political subdivision of any such state or any public instrumentality thereof maturing within 1 year from the date of acquisition thereof and, at the time of acquisition, having one of the two highest ratings obtainable from either Standard & Poor’s Rating Group (“S&P”) or Moody’s Investors Service, Inc. (“Moody’s”), (c) commercial paper maturing no more than 270 days from the date of creation thereof and, at the time of acquisition, having a rating of at least A-1 from S&P or at least P-1 from Moody’s, (d) certificates of deposit, time deposits, overnight bank deposits or bankers’ acceptances maturing within 1 year from the date of acquisition thereof issued by any bank organized under the laws of the United States or any state thereof or the District of Columbia or any United States branch of a foreign bank having at the date of acquisition thereof combined capital and surplus of not less than $250,000,000, (e) Deposit Accounts maintained with (collectively, the “Specified Institutions”) (i) any bank that satisfies the criteria described in clause (d) above, or (ii) any other bank organized under the laws of the United States or any state thereof so long as the full amount maintained with any such other bank is insured by the Federal Deposit Insurance Corporation, (f) repurchase obligations of any commercial bank satisfying the requirements of clause (d) of this definition or recognized securities dealer having combined capital and surplus of not less than $250,000,000, having a term of not more than seven days, with respect to securities satisfying the criteria in clauses (a) or (d) above, (g) debt securities with maturities of six months or less from the date of acquisition backed by standby letters of credit issued by any commercial bank satisfying the criteria described in clause (d) above, (h) Investments in money market funds substantially all of whose assets are invested in the types of assets described in clauses (a) through (g) above, and (i) Securities Accounts maintained with Specified Institutions in which all of the assets therein are Investments in the types of assets described in clauses (a) through (g) above.

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“Cash Management Services” means any cash management or related services including treasury, depository, return items, overdraft, controlled disbursement, merchant store value cards, e-payables services, electronic funds transfer, interstate depository network, automatic clearing house transfer (including the Automated Clearing House processing of electronic funds transfers through the direct Federal Reserve Fedline system) and other cash management arrangements.

“Change of Control” means at any time, after giving effect to the ownership changes on the Closing Date as a result of the consummation of the Transactions, the occurrence of any of the following events:

(a) any “person” or “group” (as such terms are used in Section 13(d) and 14(d) of the Exchange Act), is or becomes the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that a person shall be deemed to have “beneficial ownership” of all securities that such person has the right to acquire, whether such right is exercisable immediately or only after the passage of time), directly or indirectly, of 35% or more of the then outstanding voting Stock of Parent;

(b) the replacement of a majority of the Board of Directors of Parent over a 24 month period from the directors who constituted the Board of Directors at the beginning of such period, and such replacement shall not have been approved by a vote of at least a majority of the Board of Directors of Parent then still in office who either were members of such Board of Directors at the beginning of such period or whose election as a member of such Board of Directors was previously so approved;

(c) the occurrence of a “Change of Control” (or any comparable term) under, and as defined in, the documents evidencing any of the Senior Notes; and

(d) Parent fails to own and control, directly or indirectly, 100% of the Stock of each other Loan Party, except (i) as a result of any transaction permitted under Section 6.3, (ii) as a result of any sale or other disposition permitted under clause (p) of the definition of Permitted Dispositions or (iii) to the extent such other Loan Party is released from the Guaranty or no longer required to be a Guarantor pursuant to and in accordance with the terms of the Loan Documents.

“Change in Law” means the occurrence, after the date of the Agreement, of any of the following: (a) the adoption or taking effect of any law, rule, regulation or treaty, (b) any change in any law, rule, regulation or treaty or in the administration, interpretation, implementation or application thereof by any Governmental Authority or (c) the making or issuance of any request, rule, guideline or directive (whether or not having the force of law) by any Governmental Authority; provided that notwithstanding anything herein to the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (y) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in Law”, regardless of the date enacted, adopted or issued.

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“Chartered Vessel” means any Vessel leased, chartered, subleased or subchartered by a Loan Party or any Subsidiary pursuant to one or more Chartered Vessel Documents.

“Chartered Vessel Documents” means all Vessel leases, charters, subleases, subcharters and all related documents in respect of any Chartered Vessel, including those listed on Schedule V-1 hereto.

“Chassis” has the meaning specified therefor in the Security Agreement.

“Closing Date” means the date on which each of the conditions precedent set forth on Schedule 3.1 either have been satisfied or have been waived.

“Code” means the New York Uniform Commercial Code, as in effect from time to time.

“Collateral” means all assets and interests in assets and proceeds thereof now owned or hereafter acquired by a Loan Party in or upon which a Lien is granted by such Person in favor of Agent or the Lenders under any of the Loan Documents. For the avoidance of doubt, “Collateral” does not include any Excluded Assets.

“Collateral Access Agreement” means a landlord waiver, bailee letter, or acknowledgement agreement of any lessor, warehouseman, processor, consignee, or other Person in possession of, having a Lien upon, or having rights or interests in a Loan Party’s books and records pertaining to ABL Priority Collateral, in each case, in form and substance reasonably satisfactory to Agent.

“Collections” means all cash, checks, notes, instruments, and other items of payment (including insurance proceeds, cash proceeds of asset sales, rental proceeds, and tax refunds).

“Commitment Excess” has the meaning specified therefor in Section 2.4(e)(i).

“Compliance Certificate” means a certificate substantially in the form of Exhibit C-1 delivered by the chief financial officer of Parent to Agent.

“Confidential Information” has the meaning specified therefor in Section 17.9(a) of the Agreement.

“Contingent Obligations” means taxes, costs, indemnifications, reimbursements, damages, contingent Obligations and other claims and liabilities which are not due and owing or in respect of which no assertion of liability or no claim or demand for payment, in each case, in writing, has been made at such time.

“Control Agreement” means a control agreement, in form and substance reasonably satisfactory to Agent, executed and delivered by a Loan Party, Agent, and the applicable securities intermediary (with respect to a Securities Account) or bank (with respect to a Deposit Account).

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“Controlled Account” has the meaning specified therefor in the Security Agreement.

“Controlled Account Agreement” has the meaning specified therefor in the Security Agreement.

“Copyright Security Agreement” has the meaning specified therefor in the Security Agreement.

“CoT Chassis” has the meaning specified therefor in the Security Agreement.

“CSX” means CSX Corporation, a Virginia corporation.

“Daily Balance” means, as of any date of determination and with respect to any Obligation, the outstanding amount of such Obligation owed at the end of such day.

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

“Defaulting Lender” means any Lender that (a) has failed to fund any amounts required to be funded by it under the Agreement within 1 Business Day of the date that it is required to do so under the Agreement (including the failure to make available to Agent amounts required pursuant to a Settlement or to make a required payment in connection with a Letter of Credit Disbursement), (b) notified Borrower, Agent, or any Lender in writing that it does not intend to comply with all or any portion of its funding obligations under the Agreement, (c) has made a public statement to the effect that it does not intend to comply with its funding obligations under the Agreement or under other agreements generally (as reasonably determined by Agent) under which it has committed to extend credit, (d) failed, within 3 Business Day after written request by Agent, to confirm that it will comply with the terms of the Agreement relating to its obligations to fund any amounts required to be funded by it under the Agreement, (e) otherwise failed to pay over to Agent or any other Lender any other amount required to be paid by it under the Agreement within 1 Business Day of the date that it is required to do so under the Agreement, unless the subject of a good faith dispute, or (f) (i) becomes or is insolvent or has a parent company that has become or is insolvent or (ii) becomes the subject of a bankruptcy or insolvency proceeding, or has had a receiver, conservator, trustee, or custodian or appointed for it, or has taken any action in furtherance of, or indicating its consent to, approval of or acquiescence in any such proceeding or appointment or has a parent company that has become the subject of a bankruptcy or insolvency proceeding, or has had a receiver, conservator, trustee, or custodian appointed for it, or has taken any action in furtherance of, or indicating its consent to, approval of or acquiescence in any such proceeding or appointment.

“Defaulting Lender Rate” means (a) for the first 3 days from and after the date the relevant payment is due, the Base Rate, and (b) thereafter, the interest rate then applicable to Advances that are Base Rate Loans (inclusive of the Applicable Margin applicable thereto).

“Deposit Account” means any deposit account (as that term is defined in the Code).

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“Designated Account” means the Deposit Account of Borrower identified on Schedule D-1.

“Designated Account Bank” has the meaning specified therefor in Schedule D-1.

“Dilution” means, as of any date of determination, a percentage, based upon the experience of the immediately prior 3 consecutive months, that is the result of dividing the Dollar amount of (a) bad debt write-downs, discounts, advertising allowances, credits, or other similar dilutive items with respect to Borrower’s Accounts during such period, by (b) Borrower’s billings with respect to Accounts during such period.

“Dilution Reserve” means, as of any date of determination, an amount sufficient to reduce the advance rate against Eligible Accounts by 1% for each percentage point by which Dilution is in excess of 5%.

“Dollars” or “$” means United States dollars.

“Domestic Subsidiary” means any Subsidiary that is organized under the laws of the United States, any state thereof or the District of Columbia.

“Earn-Outs” means unsecured liabilities of a Loan Party arising under an agreement to make any deferred payment as a part of the Purchase Price for a Permitted Acquisition, including performance bonuses or consulting payments in any related services, employment or similar agreement, in an amount that is subject to or contingent upon the revenues, income, cash flow or profits (or the like) of the underlying target.

“Eligible Accounts” means those Accounts created by any Loan Party in the ordinary course of its business, that arise out of such Loan Party’s sale of goods or rendition of services, that comply with each of the representations and warranties respecting Eligible Accounts made in the Loan Documents, to the extent not excluded by virtue of one or more of the excluding criteria set forth below; provided, however, that such criteria may be revised from time to time by Agent in Agent’s Permitted Discretion to address the results of any field exam performed by Agent from time to time after the Closing Date. In determining the amount to be included, Eligible Accounts shall be calculated net of customer deposits and unapplied cash. Eligible Accounts shall not include the following:

(a) Accounts that the Account Debtor has failed to pay within 90 days of original invoice date or Accounts with payment terms of more than 60 days; provided, however, that Accounts with payment terms greater than 60 days will not be excluded from Eligible Accounts to the extent the aggregate amount of such Accounts does not exceed $1,000,000,

(b) Accounts owed by an Account Debtor (or its Affiliates) where 50% or more of all Accounts owed by that Account Debtor (or its Affiliates) are deemed ineligible under clause (a) above,

(c) Accounts with respect to which the Account Debtor is an Affiliate of a Loan Party or an employee or agent of a Loan Party,

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(d) Accounts that are not payable in Dollars,

(e) Accounts with respect to which the Account Debtor (i) does not maintain its chief executive office in the United States, or (ii) is not organized under the laws of the United States or any state thereof, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality, or other political subdivision thereof, or of any department, agency, public corporation, or other instrumentality thereof, except in any such case, to the extent (y) the Account is supported by a letter of credit satisfactory to Agent (as to form, substance, and issuer or domestic confirming bank) in its Permitted Discretion that has been delivered to Agent and is directly drawable by Agent, or (z) the Account is covered by credit insurance in form, substance, and amount, and by an insurer, satisfactory to Agent in its Permitted Discretion,

(f) Accounts with respect to which the Account Debtor is either (i) the United States or any department, agency, or instrumentality of the United States (exclusive, however, of Accounts with respect to which a Loan Party has complied, to the reasonable satisfaction of Agent, with the Assignment of Claims Act, 31 USC §3727, or has otherwise made arrangements with respect to such Accounts satisfactory to Agent in its Permitted Discretion) (any such Account described in this clause (i) being referred to herein as a “US Government Account”), or (ii) any state of the United States (exclusive, however, of Accounts with respect to which a Loan Party has made arrangements with respect to such Accounts satisfactory to Agent in its Permitted Discretion); provided that US Government Accounts which are not otherwise excluded from Eligible Accounts for any other reason hereunder shall be included as Eligible Accounts notwithstanding that compliance with the Assignment of Claims Act, 31 USC §3727 has not been effected unless and until 10 Business Days after Agent shall have requested that such compliance be effected (the “Exclusion Date”), and upon such request, Borrower agrees to cooperate with Agent to execute and obtain all requisite government assignments and consents from the applicable government account debtor as soon as possible, it being understood that from the Exclusion Date until such government assignments and consents have been obtained such US Government Accounts may be excluded from Eligible Accounts in Agent’s Permitted Discretion,

(g) Accounts with respect to which the Account Debtor is a creditor of any Loan Party, has a right of setoff or has asserted a right of setoff, or has disputed its obligation to pay all or any portion of the Account, in each case solely to the extent of such claim, right of setoff, or dispute,

(h) Accounts with respect to an Account Debtor whose total obligations owing to a Loan Party exceed 10% (except that, in the case of Wal-Mart, such percentage shall be 20%) (such percentage, as applied to a particular Account Debtor, being subject to reduction by Agent in its Permitted Discretion if the creditworthiness of such Account Debtor deteriorates) of all Eligible Accounts, to the extent of the obligations owing by such Account Debtor in excess of such percentage; provided, however, that, in each case, the amount of Accounts that would otherwise be Eligible Accounts that are excluded because they exceed the foregoing percentage shall be determined by Agent based on all of the otherwise Eligible Accounts prior to giving effect to any eliminations based upon the foregoing concentration limit,

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(i) Accounts with respect to which the Account Debtor is subject to an Insolvency Proceeding, is not Solvent, has gone out of business, or as to which a Loan Party has received notice of an imminent Insolvency Proceeding or a material impairment of the financial condition of such Account Debtor,

(j) Accounts, the collection of which, Agent, in its Permitted Discretion, believes to be doubtful by reason of the Account Debtor’s financial condition,

(k) Accounts that are not subject to a valid and perfected first priority Agent’s Lien; provided that, without limiting the effect or application of any other exclusion in the definition of Eligible Accounts, the existence of (i) state and federal tax Liens so long as any such lien (A) is permitted under the Agreement, (B) has priority by operation of applicable law and (C) to the extent that (1) any Loan Party has knowledge of such Lien (other than an inchoate Lien) or (2) the related taxes are overdue and unpaid or (3) the applicable tax authority has recorded or filed such lien, in each case, such Loan Party shall have promptly notified Agent of the existence of such Liens and the related taxes, but in any event within 5 days thereof, (ii) the Antitrust Judgment Lien, and (iii) the Vessel Environmental Judgment Lien, shall, in each case, not result in Accounts being excluded from Eligible Accounts; provided further that Agent shall at all times have the unfettered right to establish reserves in its Permitted Discretion against any of the foregoing Liens as provided in Section 2.1(c) of the Agreement.

(l) Accounts that are subject to a Lien of any other Person (other than a Person with whom Agent entered into an intercreditor agreement subordinating such Person’s Liens to Agent’s Liens on terms satisfactory to Agent, and other than Liens constituting Permitted Liens set forth in clause (g) of the definition thereof for which Agent has received written notice thereof),

(m) Accounts with respect to which the services giving rise to such Account have not been performed and billed to the Account Debtor (it being understood that services giving rise to an account for shipment of ocean freight are deemed performed at such time as the vessel carrying such freight sets sail from the port of departure),

(n) Accounts with respect to which the Account Debtor is a Sanctioned Person or Sanctioned Entity,

(o) Accounts that represent the right to receive progress payments or other advance billings that are due prior to the completion of performance by any Loan Party of the subject contract for goods or service (it being understood that services giving rise to an account for shipment of ocean freight are deemed performed at such time as the vessel carrying such freight sets sail from the port of departure),

(p) Accounts with payment terms requiring that cash payment be made on the date of the performance of the underlying service,

(q) Accounts associated with volume incentive discounts (such as GL#3440000), solely to the extent of any such volume incentive discount agreed to by the Loan Parties and accrued against such Accounts,

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(r) Accounts with a remaining balance currently outstanding that is less than the original invoice amount,

(s) Accounts solely to the extent cash has been received in payment of such Accounts but unapplied to the specific invoices (such as amounts in GL#1539700), or

(t) Accounts acquired in connection with any Permitted Acquisition, until the completion of an audit of such Accounts, satisfactory to Agent in its Permitted Discretion (which audit may be conducted prior to the closing of such Permitted Acquisition).

“Eligible Transferee” means (a) a commercial bank organized under the laws of the United States, or any state thereof, and having total assets in excess of $500,000,000, (b) a commercial bank organized under the laws of any other country which is a member of the Organization for Economic Cooperation and Development or a political subdivision of any such country and which has total assets in excess of $500,000,000, provided that such bank is acting through a branch or agency located in the United States, (c) a finance company, insurance company, or other financial institution or fund that is engaged in making, purchasing, or otherwise investing in commercial loans in the ordinary course of its business and having (together with its Affiliates) total assets in excess of $500,000,000, (d) any Affiliate (other than individuals) of a pre-existing Lender, (e) so long as no Event of Default has occurred and is continuing, any other Person approved by Agent and Borrower (such approval by Borrower not to be unreasonably withheld, conditioned or delayed), and (f) during the continuation of an Event of Default, any other Person approved by Agent; provided that an “Eligible Transferee” shall not include any Loan Party or any Affiliate of any Loan Party.

“Employee Benefit Plan” means (a) any employee benefit plan within the meaning of Section 3(3) of ERISA that is maintained, funded or administered by any Loan Party or any ERISA Affiliate or (b) any Pension Plan or Multiemployer Plan that has at any time within the preceding six (6) years been maintained, funded or administered by any Loan Party or any current or former ERISA Affiliate.

“Environmental Action” means any written complaint, summons, citation, directive, order, claim, litigation, investigation, judicial or administrative proceeding or judgment from any Governmental Authority, or any Person involving violations or alleged violations of Environmental Laws or releases or threatened releases of Hazardous Materials (a) from any assets, properties, or businesses of Parent, any Subsidiary of Parent, or any of their predecessors in interest, or (b) from or onto any facilities which received Hazardous Materials generated by Parent, any Subsidiary of Parent, or any of their predecessors in interest.

“Environmental Law” means any applicable federal, state, provincial, foreign or local statute, law, rule having the force and effect of law, regulation, ordinance, code, binding and enforceable guideline, binding and enforceable written policy, or rule of common law now or hereafter in effect and in each case as amended, including any judicial or administrative order, consent decree or judgment, in each case, to the extent binding on Parent or its Subsidiaries, relating to the environment, the effect of the environment on employee health, or Hazardous Materials, in each case as amended from time to time.

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“Environmental Liabilities” means all liabilities, monetary obligations, losses, damages, costs and expenses (including all reasonable fees, disbursements and expenses of counsel, experts, or consultants, and costs of investigation and feasibility studies), fines, penalties, sanctions, and interest incurred as a result of any claim or demand, or Remedial Action required, by any Governmental Authority or any third party, and which relate to any Environmental Action.

“Environmental Lien” means any Lien in favor of any Governmental Authority for Environmental Liabilities.

“Equipment” means equipment (as that term is defined in the Code).

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended, and any successor statute thereto.

“ERISA Affiliate” means (a) any Person subject to ERISA whose employees are treated as employed by the same employer as the employees of Parent or its Subsidiaries under IRC Section 414(b), (b) any trade or business subject to ERISA whose employees are treated as employed by the same employer as the employees of Parent or its Subsidiaries under IRC Section 414(c), (c) solely for purposes of Section 302 of ERISA or Section 412 or 430 of the IRC, any organization subject to ERISA that is a member of an affiliated service group of which Parent or any of its Subsidiaries is a member under IRC Section 414(m), or (d) solely for purposes of Section 302 of ERISA or Section 412 or 430 of the IRC, any Person subject to ERISA that is a party to an arrangement with Parent or any of its Subsidiaries and whose employees are aggregated with the employees of Parent or its Subsidiaries under IRC Section 414(o).

“Event of Default” has the meaning specified therefor in Section 8 of the Agreement.

“Excess Availability” means, as of any date of determination, an amount equal to (a) the lesser of (i) the Maximum Revolver Amount and (ii) the Borrowing Base minus (b) the Revolver Usage minus (c) the aggregate amount, if any, of all trade payables of the Loan Parties that are more than 60 days past due, except for trade payables which are being disputed in good faith by a Loan Party.

“Excess Availability Calculation” has the meaning specified therefor in the definition of Applicable Margin.

“Exchange Act” means the Securities Exchange Act of 1934, as in effect from time to time.

“Excluded Accounts” has the meaning specified therefor in the Security Agreement.

“Excluded Assets” has the meaning specified therefor in the Security Agreement.

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“Existing Credit Agreement” means that certain Credit Agreement, dated as of August 8, 2007, among Parent, certain Subsidiaries of Parent as guarantors, the lenders party thereto and Wells Fargo Bank, National Association (successor by merger to Wachovia Bank, National Association), as administrative agent, as amended.

“Existing Letters of Credit” means those letters of credit described on Schedule E-1 to the Agreement.

“Existing Notes” means the 4.25% Convertible Secured Notes due 2012, issued by Parent in an aggregate principal amount of $330,000,000.

“Extension of Credit” means, as the context may require, (i) the making of an Advance by a Lender or (ii) the issuance of any Letter of Credit by the Issuing Lender or the amendment, extension or renewal of any Letter of Credit; provided that “Extensions of Credit” shall not include conversions and continuations of outstanding Advances.

“FATCA” means Sections 1471 through 1474 of the IRC, as of the date of the Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with) and any current or future regulations or official interpretations thereof.

“Federal Funds Rate” means, for any period, a fluctuating interest rate per annum equal to, for each day during such period, the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers, as published on the next succeeding Business Day by the Federal Reserve Bank of New York, or, if such rate is not so published for any day which is a Business Day, the average of the quotations for such day on such transactions received by Agent from three Federal funds brokers of recognized standing selected by it.

“Fee Letter” means that certain fee letter, dated as of August 26, 2011, between Parent and Agent.

“Fixed Charge Coverage Ratio” means, with respect to Parent and its Subsidiaries, determined on a consolidated basis, for any Reference Period, the ratio of (a) Adjusted EBITDA for such period for such period, minus the sum of (i) Unfinanced Capital Expenditures made or incurred during such period, (ii) all federal state, and local income taxes paid in cash during such period to the extent added back in the calculation of Adjusted EBITDA for such period and (iii) Restricted Stock Payments paid in cash during such period to persons other than Parent or another Loan Party to (b) Fixed Charges for such period.

“Fixed Charges” means, with respect to any fiscal period and with respect to Parent and its Subsidiaries determined on a consolidated basis in accordance with GAAP, the sum, without duplication, of (a) Interest Expense (net of interest income and other cash offsets to Interest Expense) paid in cash during such period, (b) scheduled principal payments in respect of Funded Indebtedness that are required to be paid during such period and (c) scheduled payments after the Closing Date in respect of the Antitrust Judgment, the Vessel Environmental Judgment and any scheduled payments in connection any judgments, orders or awards entered into or existing after the Closing Date for such period, which are secured by Liens on the Collateral.

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For the purposes of calculating Interest Expense with respect to Fixed Charges for any Reference Period, if at any time during such Reference Period (and after the Closing Date), Parent or any of its Subsidiaries shall have (to the extent permitted by the Agreement) (a) converted any Indebtedness of Parent or any of its Subsidiaries into Stock of Parent or such Subsidiary or (b) repurchased or repaid any Indebtedness (other than (x) the repayment of revolving Indebtedness that does not permanently reduce the commitments therefor and Indebtedness maturing within 1 year of the date of issuance thereof and (y) repurchases or repayments of term loans, notes and other Funded Indebtedness maturing more than 1 year after the date of issuance thereof which are refinanced or replaced by other Funded Indebtedness) of Parent or any of its Subsidiaries (collectively, a “Specified Transaction”), then Interest Expense for such Reference Period shall be calculated as if such Specified Transaction occurred on the first day of such Reference Period and all Interest Expense attributable to such converted or refinanced Indebtedness shall be excluded from the calculation of Fixed Charges; provided that Interest Expense accrued prior to the Closing Date shall be measured as the actual amount thereof paid and not in accordance with the preceding provisions of this paragraph.

“Foreign Lender” means any Lender or Participant that is not a United States person within the meaning of Section 7701(a)(30) of the IRC.

“Foreign Subsidiary” means any Subsidiary that is not a Domestic Subsidiary.

“Funded Indebtedness” means, as of any date of determination, all Indebtedness for borrowed money or letters of credit of Parent, determined on a consolidated basis in accordance with GAAP, that by its terms matures more than one year after the date of calculation, and any such Indebtedness maturing within one year from such date that is renewable or extendable at the option of Parent or its Subsidiaries, as applicable, to a date more than one year from such date, including, in any event, but without duplication, with respect to Parent and its Subsidiaries, the Revolver Usage, and the amount of their Capitalized Lease Obligations.

“Funding Date” means the date on which a Borrowing occurs.

“Funding Losses” has the meaning specified therefor in Section 2.12(b)(ii) of the Agreement.

“GAAP” means, subject to the limitations and application thereof set forth in Section 1.2, generally accepted accounting principles as in effect from time to time in the United States, consistently applied; provided, however, that all calculations relative to liabilities shall be made without giving effect to Statement of Financial Accounting Standards No. 159.

“Governing Documents” means, with respect to any Person, the certificate or articles of incorporation, by-laws, or other organizational documents of such Person.

“Governmental Authority” means any federal, state, local, or other governmental or administrative body, instrumentality, board, department, or agency or any court, tribunal, administrative hearing body, arbitration panel, commission, or other similar dispute-resolving panel or body.

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“Guarantors” means (a) each Domestic Subsidiary of Parent (other than any Immaterial Subsidiary and any other Subsidiary that is not required to become a Guarantor pursuant to Section 5.11), (b) Parent and (c) each other Person that becomes a guarantor after the Closing Date pursuant to Section 5.11 of the Agreement, and “Guarantor” means any one of them.

“Guaranty” means that certain general continuing guaranty, dated as of even date with the Agreement, executed and delivered by each extant Guarantor in favor of Agent, for the benefit of the Lender Group and the Bank Product Providers, in form and substance reasonably satisfactory to Agent.

“Hazardous Materials” means (a) substances that are defined or listed in, or otherwise classified pursuant to, any applicable laws or regulations as “hazardous substances,” “hazardous materials,” “hazardous wastes,” “toxic substances,” or any other formulation intended to define, list, or classify substances by reason of deleterious properties such as ignitability, corrosivity, reactivity, carcinogenicity, reproductive toxicity, or “EP toxicity”, (b) oil, petroleum, or petroleum derived substances, natural gas, natural gas liquids, synthetic gas, drilling fluids, produced waters, and other wastes associated with the exploration, development, or production of crude oil, natural gas, or geothermal resources, (c) any flammable substances or explosives or any radioactive materials, and (d) asbestos in any form or electrical equipment that contains any oil or dielectric fluid containing levels of polychlorinated biphenyls in excess of 50 parts per million.

“Hedge Agreement” means a “swap agreement” as that term is defined in Section 101(53B)(A) of the Bankruptcy Code, including, without limitation, any rate swap agreement, forward rate agreement, commodity swap, commodity option (including with respect to commodities, raw materials, emission rights and weather related risks or assets), interest rate option, forward foreign exchange agreement, spot foreign exchange agreement, rate cap agreement, rate floor agreement, rate collar agreement, currency swap agreement, cross-currency rate swap agreement, currency option (including in each case with respect to any indexes in respect of any of the foregoing, and any other similar agreement.

“Hedge Obligations” means any and all obligations or liabilities, whether absolute or contingent, due or to become due, now existing or hereafter arising, of a Loan Party arising under, owing pursuant to, or existing in respect of Hedge Agreements entered into with one or more of the Hedge Providers.

“Hedge Provider” means any Lender or any of its Affiliates; provided, however, that no such Person (other than Wells Fargo or its Affiliates) shall constitute a Hedge Provider unless and until Agent shall have received a Bank Product Provider Agreement from such Person and with respect to the applicable Hedge Agreement within 10 days after (a) the execution and delivery of such Hedge Agreement with any Loan Party or (b) if such Person entered into such Hedge Agreement prior to the Closing Date, the Closing Date; provided further, however, that if, at any time, a Lender ceases to be a Lender under the Agreement, then, from and after the date on which it ceases to be a Lender thereunder, neither it nor any of its Affiliates shall constitute Hedge Providers and the obligations with respect to Hedge Agreements entered into with such former Lender or any of its Affiliates shall no longer constitute Hedge Obligations.

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“Holdout Lender” has the meaning specified therefor in Section 14.2(a) of the Agreement.

“Immaterial Subsidiary” means a direct or indirect Subsidiary of Parent with respect to which each of the following is satisfied: (a) the aggregate net sales of such Subsidiary are less than $2,000,000 for the period of 12 months most recently ended prior to such Subsidiary being designated an Immaterial Subsidiary, (b) the book value of the tangible assets of such Subsidiary is less than $1,500,000, (c) after giving pro forma effect to the designation of such Subsidiary as an Immaterial Subsidiary, (i) the aggregate net sales of all Subsidiaries that are not Guarantors for the 12 months most recently ended prior to such designation do not exceed $5,000,000 and (ii) the aggregate book value of the tangible assets of all Immaterial Subsidiaries does not exceed $5,000,000, (d) Parent has designated such Subsidiary as an Immaterial Subsidiary under the Agreement and Parent has provided written notice to Agent in reasonable detail of such designation within 5 days after designation thereof, (e) such Subsidiary does not own any Stock or hold any Lien on any property of a Loan Party and (f) such Subsidiary has never been a Loan Party after being an Immaterial Subsidiary.

“Increase Closing Date” has the meaning specified therefor in Section 2.14(d).

“Indebtedness” as to any Person means (a) all obligations of such Person for borrowed money, (b) all obligations of such Person evidenced by bonds, debentures, notes, or other similar instruments and all reimbursement or other obligations in respect of letters of credit, bankers acceptances, or other financial products, (c) all obligations of such Person as a lessee under Capital Leases, (d) all obligations or liabilities of others secured by a Lien on any asset of such Person, irrespective of whether such obligation or liability is assumed, (e) all obligations of such Person to pay the deferred purchase price of assets (other than trade payables incurred in the ordinary course of business and repayable in accordance with customary trade practices), (f) all obligations of such Person owing under Hedge Agreements (which amount shall be calculated based on the amount that would be payable by such Person if the Hedge Agreement were terminated on the date of determination), (g) any Prohibited Preferred Stock of such Person, and (h) any obligation of such Person guaranteeing or intended to guarantee (whether directly or indirectly guaranteed, endorsed, co-made, discounted, or sold with recourse) any obligation of any other Person that constitutes Indebtedness under any of clauses (a) through (g) above. Notwithstanding the foregoing, “Indebtedness,” except for purposes of Section 8.7, shall not include obligations under any unsecured settlement or plea agreements or similar arrangements providing for the payment of judgments, decrees, orders, awards, settlements or fines. For purposes of this definition, (i) the amount of any Indebtedness represented by a guaranty or other similar instrument shall be the lesser of the principal amount of the obligations guaranteed and still outstanding and the maximum amount for which the guaranteeing Person may be liable pursuant to the terms of the instrument embodying such Indebtedness, and (ii) the amount of any Indebtedness described in clause (d) above shall be the lower of the amount of the obligation and the fair market value of the assets of such Person securing such obligation.

“Indemnified Liabilities” has the meaning specified therefor in Section 10.3 of the Agreement.

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“Indemnified Person” has the meaning specified therefor in Section 10.3 of the Agreement.

“Indirect Purchasers Settlement” means the $1,800,000 settlement of the investigation by the Puerto Rico office of Monopolistic Affairs and the lawsuit filed by the Commonwealth of Puerto Rico and the class action lawsuit in the indirect purchasers case.

“Insolvency Proceeding” means any proceeding commenced by or against any Person under any provision of the Bankruptcy Code or under any other state or federal bankruptcy or insolvency law, assignments for the benefit of creditors, formal or informal moratoria, compositions, extensions generally with creditors, or proceedings seeking reorganization, arrangement, or other similar relief.

“Intercreditor Agreement” means that certain Intercreditor Agreement, dated as of the date hereof, by and among Parent, Borrower, Agent, and the applicable trustee under each of the Secured Notes.

“Interest Expense” means, for any period, the aggregate of the interest expense of Parent for such period, determined on a consolidated basis in accordance with GAAP.

“Interest Period” means, with respect to each LIBOR Rate Loan, a period commencing on the date of the making of such LIBOR Rate Loan (or the continuation of a LIBOR Rate Loan or the conversion of a Base Rate Loan to a LIBOR Rate Loan) and ending 1, 2, or 3, or 6 months thereafter and 9 or 12 months thereafter, if available to, and consented to by, each Lender; provided, however, that (a) interest shall accrue at the applicable rate based upon the LIBOR Rate from and including the first day of each Interest Period to, but excluding, the day on which any Interest Period expires, (b) any Interest Period that would 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 month, in which case such Interest Period shall end on the next preceding Business Day, (c) with respect to an Interest Period that begins on the last Business Day of a month (or on a day for which there is no numerically corresponding day in the month at the end of such Interest Period), the Interest Period shall end on the last Business Day of the month that is 1, 2, or 3, or 6 months after (or 9 or 12 months after, if available to, and consented to by, each Lender) the date on which the Interest Period began, as applicable, and (d) Borrower may not elect an Interest Period which will end after the Maturity Date.

“Inventory” means inventory (as that term is defined in the Code).

“Investment” means, with respect to any Person, any investment by such Person in any other Person (including Affiliates) in the form of loans, guarantees, advances, capital contributions (excluding (a) commission, travel, and similar advances to officers, directors (or the equivalent) and employees of such Person made in the ordinary course of business, and (b) bona fide Accounts arising in the ordinary course of business), or acquisitions of Indebtedness, Stock, or all or substantially all of the assets of such other Person (or of any division or business line of such other Person), and any other items, in each case, that are or would be classified as investments on a balance sheet prepared in accordance with GAAP. The value of an Investment shall be determined based on its cost on the date each such Investment was made, minus all capital returned and sale proceeds received in respect thereof, and without giving effect to any other subsequent changes in value.

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“IRC” means the Internal Revenue Code of 1986, as amended from time to time.

“Issuing Lender” means WFCF (or one of its Affiliates).

“Lender” has the meaning specified therefor in the preamble to the Agreement, shall include the Issuing Lender and the Swing Lender, and shall also include any Assignee made a party to the Agreement pursuant to and in accordance with the provisions of Section 13.1 of the Agreement, and “Lenders” means each of the Lenders or any one or more of them.

“Lender Group” means each of the Lenders (including the Issuing Lender and the Swing Lender) and Agent, or any one or more of them.

“Lender Group Expenses” means all (a) costs or expenses (including taxes, and insurance premiums) required to be paid by a Loan Party under any of the Loan Documents that are paid, advanced, or incurred by the Lender Group, (b) out-of-pocket fees or charges paid or incurred by Agent in connection with the Lender Group’s transactions with the Loan Parties under any of the Loan Documents, including, fees or charges for photocopying, notarization, couriers and messengers, telecommunication, public record searches (including tax lien, litigation, and uniform commercial code searches and including searches with the patent and trademark office, the copyright office, or, if applicable, the department of motor vehicles), filing, recording, publication, appraisal (including periodic collateral appraisals or business valuations to the extent of the fees and charges (and up to the amount of any limitation) contained in the Agreement or the Fee Letter), real estate surveys, real estate title policies and endorsements, and environmental audits, (c) Agent’s customary fees and charges (as adjusted from time to time) with respect to the disbursement of funds (or the receipt of funds) to or for the account of Borrower (whether by wire transfer or otherwise), together with any out-of-pocket costs and expenses incurred in connection therewith, (d) out-of-pocket charges paid or incurred by Agent resulting from the dishonor of checks payable by or to any Loan Party, (e) reasonable out-of-pocket costs and expenses paid or incurred by the Lender Group to correct any default or enforce any provision of the Loan Documents, or during the continuance of an Event of Default, in gaining possession of, maintaining, handling, preserving, storing, shipping, selling, preparing for sale, or advertising to sell the Collateral, or any portion thereof, irrespective of whether a sale is consummated, (f) reasonable out-of-pocket audit fees and expenses (including travel, meals, and lodging) of Agent related to any inspections or audits to the extent of the fees and charges (and up to the amount of any limitation) contained in the Agreement or the Fee Letter, (g) reasonable out-of-pocket costs and expenses of third party claims or any other suit paid or incurred by the Lender Group in enforcing or defending the Loan Documents or in connection with the Transactions or any transactions contemplated by the Loan Documents, (h) Agent’s reasonable costs and expenses (including reasonable attorneys fees) incurred in advising, structuring, drafting, reviewing, administering (including travel, meals, and lodging), syndicating, or amending the Loan Documents, (i) Agent’s and each Lender’s reasonable costs and expenses (including reasonable attorneys, accountants, consultants, and other advisors fees and expenses) incurred in terminating, enforcing (including attorneys, accountants, consultants, and other advisors fees and expenses incurred in connection with a “workout,” a “restructuring,” or an

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Insolvency Proceeding concerning Parent or any of the other Loan Parties or in exercising rights or remedies under the Loan Documents), or defending the Loan Documents, irrespective of whether suit is brought, or in taking any Remedial Action concerning the Collateral, and (j) usage charges, charges, fees, costs and expenses for amendments, renewals, extensions, transfers, or drawings from time to time imposed by the Underlying Issuer or incurred by the Issuing Lender in respect of Letters of Credit and out-of-pocket charges, fees, costs and expenses paid or incurred by the Underlying Issuer or Issuing Lender in connection with the issuance, amendment, renewal, extension, or transfer of, or drawing under, any Letter of Credit or any demand for payment thereunder.

“Lender Group Representatives” has the meaning specified therefor in Section 17.9 of the Agreement.

“Lender-Related Person” means, with respect to any Lender, such Lender, together with such Lender’s Affiliates, officers, directors, employees, attorneys, and agents.

“Letter of Credit” means a letter of credit (as that term is defined in the Code) issued by Issuing Lender or a letter of credit (as that term is defined in the Code) issued by Underlying Issuer, as the context requires, including each Existing Letter of Credit.

“Letter of Credit Collateralization” means either (a) providing cash collateral (pursuant to documentation reasonably satisfactory to Agent, including provisions that specify that the Letter of Credit fee and all usage charges set forth in the Agreement will continue to accrue while such Letters of Credit is outstanding) to be held by Agent for the benefit of the Applicable Party in an amount equal to 105% of the then existing Letter of Credit Usage, (b) delivering to Agent documentation executed by all beneficiaries under the Letters of Credit, in form and substance reasonably satisfactory to Agent and the Issuing Lender, terminating all of such beneficiaries’ rights under the Letters of Credit or (c) providing Agent with a standby letter of credit, in form and substance reasonably satisfactory to Agent, from a commercial bank acceptable to Agent (in its sole discretion) in an amount equal to 105% of the then existing Letter of Credit Usage (it being understood that the Letter of Credit fee and all usage charges set forth in the Agreement will continue to accrue while the Letters of Credit are outstanding and that any such fees that accrue must be an amount that can be drawn under any such standby letter of credit). “Applicable Party” means (i) prior to termination of the of the Lenders obligations to purchase participations in Letters of Credit, those Lenders with a Revolver Commitment, and (ii) thereafter, the Issuing Lender.

“Letter of Credit Disbursement” means a payment made by Issuing Lender or Underlying Issuer pursuant to a Letter of Credit.

“Letter of Credit Usage” means, as of any date of determination, the aggregate undrawn amount of all outstanding Letters of Credit.

“Leverage Ratio” means, as of the last day of any fiscal month, the ratio of (a) the amount of Funded Indebtedness as of such date, to (b) Adjusted EBITDA for the Reference Period ended as of such date.

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“LIBOR Deadline” has the meaning specified therefor in Section 2.12(b)(i) of the Agreement.

“LIBOR Notice” means a written notice in the form of Exhibit L-1.

“LIBOR Option” has the meaning specified therefor in Section 2.12(a) of the Agreement.

“LIBOR Rate” means the rate per annum rate determined by Agent pursuant to the following formula:

LIBOR Rate =	LIBOR Base Rate
	1.00-LIBOR Reserve Percentage

“LIBOR Base Rate” means the rate per annum rate appearing on Macro*World’s (www.mworld.com; the “Service”) Page BBA LIBOR - USD (or on any successor or substitute page of such Service, or any successor to or substitute for such Service) 2 Business Days prior to the commencement of the requested Interest Period, for a term and in an amount comparable to the Interest Period and the amount of the LIBOR Rate Loan requested (whether as an initial LIBOR Rate Loan or as a continuation of a LIBOR Rate Loan or as a conversion of a Base Rate Loan to a LIBOR Rate Loan) by Borrower in accordance with the Agreement, which determination shall be conclusive in the absence of manifest error.

“LIBOR Reserve Percentage” means, for any day during any Interest Period, the reserve percentage (expressed as a decimal, carried out to five decimal places) in effect on such day applicable to member banks under regulations issued from time to time by the Federal Reserve Bank for determining the maximum reserve requirement (including any emergency, supplemental or other marginal reserve requirement) with respect to LIBOR Rate Loans (currently referred to as “Eurocurrency liabilities”). The LIBOR Rate for each outstanding LIBOR Rate Loan shall be adjusted automatically as of the effective date of any change in the LIBOR Reserve Percentage.

“LIBOR Rate Loan” means each portion of an Advance that bears interest at a rate determined by reference to the LIBOR Rate.

“Lien” means any mortgage, deed of trust, pledge, hypothecation, assignment, charge, deposit arrangement, encumbrance, easement, lien (statutory or other), security interest, or other security arrangement and any other preference, priority, or preferential arrangement of any kind or nature whatsoever, including any conditional sale contract or other title retention agreement, the interest of a lessor under a Capital Lease and any synthetic or other financing lease having substantially the same economic effect as any of the foregoing.

“Loan Account” has the meaning specified therefor in Section 2.9 of the Agreement.

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“Loan Documents” means the Agreement, the Intercreditor Agreement, any Borrowing Base Certificate, the Controlled Account Agreement, the Control Agreements, the Copyright Security Agreement, the Fee Letter, the Guaranty, the Letters of Credit, the Mortgages, the Vessel Fleet Mortgages, the Patent Security Agreement, the Security Agreement, the Trademark Security Agreement, any note or notes executed by Borrower evidencing Obligations under the Agreement and payable to any member of the Lender Group, any Letter of Credit application or Letter of Credit agreement entered into by Borrower in connection with the Agreement, and any other instrument or agreement entered into, now or in the future, by Parent or any of its Subsidiaries and any member of the Lender Group in connection with the Agreement.

“Loan Party” means Borrower or any Guarantor.

“Margin Stock” as defined in Regulation U of the Board of Governors of the Federal Reserve System as in effect from time to time.

“Material Adverse Change” means (a) a material adverse change in, or material adverse effect on, the business, affairs, properties, operations, condition (financial or otherwise), assets or liabilities (whether actual or contingent) of Parent and its Subsidiaries, taken as a whole (b) a material impairment of Parent’s and its Subsidiaries ability to perform their obligations under the Loan Documents to which they are parties or of the Lender Group’s ability to enforce the Obligations or realize upon the Collateral, or (c) a material impairment of the enforceability or priority of Agent’s Liens with respect to the Collateral as a result of an action or failure to act on the part of Parent or its Subsidiaries; provided, however, that none of the following will be deemed to constitute, individually or in the aggregate, a Material Adverse Change:

(i) the negative changes, if any, in the financial position and results of operations of Parent since December 26, 2010, as reflected in Part I, item 1 of the 10Q Report for the quarter ended June 26, 2011 (the “10Q Report”); (ii) the performance of the business and operations of Parent and its Subsidiaries for any period prior to the Closing Date in a manner materially consistent with Parent’s financial projections previously delivered to the Agent and dated August 3, 2011 (for the avoidance of doubt, any decrease of projected adjusted trailing 12-month Adjusted EBITDA from the amounts reflected in such projections of not more than 22.75% would be considered materially consistent); (iii) notice of the delisting of Parent’s shares so long as Parent is diligently pursuing a plan of action with the New York Stock Exchange to avoid a delisting; (iv) (a) any workforce reductions (and any related restructuring costs) occurring prior to the date hereof and disclosed in Part I, item 1 of the 10Q Report under the heading “Restructuring”, (b) Parent’s senior management changes occurring after December 26, 2010 described in Part II, item 7 of Parent’s annual report on Form 10-K for the year ended December 26, 2010 (the “10K Report”) under the heading “Recent Developments” and (c) the separation and compensation obligations relating to Parent’s former CEO, interim CEO and any permanent CEO disclosed in Part I, item 1 and Part I, item 7 of the 10K Report and Part I, item 2 of the 10Q Report under the heading “Executive Overview”; (v) (a) the existence of the litigation matters, judgments and settlements, and the payments of the respective amounts of such judgments and settlements, and the payment of legal fees and expenses incurred in connection with such matters, judgments and settlements, described in Part II, item 1 of the 10Q Report, the actual settlement of which such non-antitrust litigation matters does not exceed $7,500,000 in the

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aggregate and (b) settlement and other similar items disclosed in writing to, and agreed to by, the Agent prior to the date of the Commitment Letter, in amounts less than or equal to the amounts disclosed in writing to, and agreed to in writing by, the Agent prior to the date of the Commitment Letter; (vi) the contraction in liquidity described in Part I, item 2 of the 10Q Report under the heading “Liquidity Outlook”; and (vii) the Non-Domestic Reorganization to the extent the actual cost and expenses therefor do not exceed the amount agreed to in writing by Agent prior to the Closing Date.

Notwithstanding anything herein to the contrary, the foregoing clauses in the proviso immediately above shall not be construed as precluding any material worsening of any of the circumstances or conditions described in such clauses which worsening causes a material adverse change in or has a material adverse effect on the business, affairs, properties, operations, condition (financial or otherwise), assets or liabilities (whether actual or contingent) of Parent and its Subsidiaries, taken as a whole, from constituting a Material Adverse Change.

“Material Contract” means, with respect to any Loan Party, all contracts or agreements, the loss of which could reasonably be expected to result in a Material Adverse Change.

“Maturity Date” has the meaning specified therefor in Section 3.3 of the Agreement.

“Maximum Revolver Amount” means $100,000,000, decreased by the amount of reductions in the Revolver Commitments made in accordance with Section 2.4(c) of the Agreement or increased pursuant to Section 2.14.

“Moody’s” has the meaning specified therefor in the definition of Cash Equivalents.

“Mortgage Policy” has the meaning specified therefor in Schedule 3.6.

“Mortgage Trustee” means the “Mortgagee” as defined in the applicable Vessel Fleet Mortgage.

“Mortgaged Vessel” means each Vessel and appurtenance thereto owned by any Loan Party and identified as such on Schedule 4.28 and each other Vessel and all appurtenances thereto with respect to which a Vessel Fleet Mortgage is granted pursuant to the Loan Documents.

“Mortgages” means, individually and collectively, one or more mortgages, deeds of trust, or deeds to secure debt, executed and delivered by Parent or its Subsidiaries in favor of Agent, in form and substance reasonably satisfactory to Agent, that encumber the Real Property Collateral.

“Multiemployer Plan” means a “multiemployer plan” as defined in Section 4001(a)(3) of ERISA to which any Loan Party or any ERISA Affiliate is making, or is accruing an obligation to make, or has accrued an obligation to make contributions within the preceding seven (7) years.

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“Net Cash Proceeds” means, with respect to any sale or disposition by Parent or any of its Subsidiaries of assets, the amount of cash proceeds received (directly or indirectly) from time to time (whether as initial consideration or through the payment of deferred consideration) by or on behalf of Parent or its Subsidiaries, in connection therewith after deducting therefrom only (i) the amount of any Indebtedness secured by any Permitted Lien on any such asset (other than (A) Indebtedness owing to Agent or any Lender under the Agreement or the other Loan Documents and (B) Indebtedness assumed by the purchaser of such assets) which is required to be, and is, repaid in connection with such sale or disposition, (ii) reasonable fees, commissions, and expenses related thereto and required to be paid by Parent or such Subsidiary in connection with such sale or disposition, (iii) any payment with respect to liabilities associated with such assets or assets and retained by Parent or any of its Subsidiaries after such sale or other disposition thereof, including, without limitation, severance costs, pension and other post-employment benefit liabilities and liabilities related to environmental matters or against any indemnification obligations associated with such transaction, (iv) any cash escrows in connection with purchase price adjustments, reserves or indemnities (until released) and (v) taxes paid or payable to any taxing authorities by Parent or such Subsidiary as a result of such sale or disposition, in each case to the extent, but only to the extent, that the amounts so deducted are properly attributable to such transaction.

“Non-Domestic Reorganization” means the complete or partial shut-down, wind-down closure, restructuring, reorganization, consolidation or reduction of the Non-Domestic Service.

“Non-Domestic Reorganization Charges” means any and all reasonable fees, costs, charges, expenses or liabilities associated with, or resulting from, the Non-Domestic Reorganization, including without limitation (i) such fees, costs, charges, expenses or liabilities resulting from, or associated with, the sale, disposition, trade-in, lease, sub-lease, use or maintenance of Vessels and any other related assets, (ii) such fees, costs, charges, expenses or liabilities resulting from, or associated with, the storage, parking, docking, dry-docking, repair, refurbishment or reflagging of Vessels and other related assets and (iii) such fees, costs, charges, expenses or liabilities resulting from, or associated with the compliance with any agreements relevant to the Non-Domestic Service, and/or the buy-down or early termination or breach of any such agreement, including any early termination payments, lease and/or sub-lease payments (including any such payments resulting from an early-termination or a termination in breach of the terms and conditions of any relevant agreement), breakage costs, indemnities, premiums, off-sets, make-whole payments, parking charges, penalties, fines and any litigation, settlement and/or work-out fees, costs, charges, expenses and/or liabilities in connection with any of the foregoing.

“Non-Domestic Service” means the non-domestic service provided by Parent and its Subsidiaries using vessels not qualified for operation in the coastwise trade of the United States.

“Non-Domestic Services Losses Schedule” means that certain schedule of Non-Domestic Service losses referred to clause (xxii) of the definition of Adjusted EBITDA and delivered to Agent after the Closing Date pursuant to Section 3.6.

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“Non-Loan Party” means any Subsidiary of Parent that is not a Loan Party.

“Noticed Bank Product Obligations” means (a) all Bank Product Obligations of Wells Fargo and its Affiliates and (b) those Bank Product Obligations of other Bank Product Providers for which Agent has received a Bank Product Provider Agreement within 10 days after the date of the provision of such Bank Product to a Parent or its Subsidiaries, as such Noticed Bank Product Obligations may be adjusted from time to time pursuant to a written report delivered in accordance with the applicable Bank Product Provider Agreement; provided that (i) no Noticed Bank Product Obligations may be established or increased (A) at any time that an Event of Default exists or (B) if a reserve in the amount of such established or increased Bank Product Obligations would cause an Overadvance and (ii) for any Bank Product Obligations existing on the Closing Date, Agent shall have received a Bank Product Provider Agreement within 10 days after the Closing Date.

“Obligations” means (a) all loans (including the Advances (inclusive of Revolver Loans, Protective Advances and Swing Loans)), debts, principal, interest (including any interest that accrues after the commencement of an Insolvency Proceeding, regardless of whether allowed or allowable in whole or in part as a claim in any such Insolvency Proceeding), reimbursement or indemnification obligations with respect to Reimbursement Undertakings or with respect to Letters of Credit (irrespective of whether contingent), premiums, liabilities (including all amounts charged to the Loan Account pursuant to the Agreement), obligations (including indemnification obligations), fees (including the fees provided for in the Fee Letter), Lender Group Expenses (including any fees or expenses that accrue after the commencement of an Insolvency Proceeding, regardless of whether allowed or allowable in whole or in part as a claim in any such Insolvency Proceeding), guaranties, and all covenants and duties of any other kind and description owing by any Loan Party pursuant to or evidenced by the Agreement or any of the other Loan Documents and irrespective of whether for the payment of money, whether direct or indirect, absolute or contingent, due or to become due, now existing or hereafter arising, and including all interest not paid when due and all other expenses or other amounts that Borrower is required to pay or reimburse by the Loan Documents or by law or otherwise in connection with the Loan Documents, (b) all debts, liabilities, or obligations (including reimbursement obligations, irrespective of whether contingent) owing by Borrower or any other Loan Party to an Underlying Issuer now or hereafter arising from or in respect of an Underlying Letters of Credit, and (c) all Bank Product Obligations. Any reference in the Agreement or in the Loan Documents to the Obligations shall include all or any portion thereof and any extensions, modifications, renewals, or alterations thereof, both prior and subsequent to any Insolvency Proceeding.

“OFAC” means The Office of Foreign Assets Control of the U.S. Department of the Treasury.

“Originating Lender” has the meaning specified therefor in Section 13.1(e) of the Agreement.

“Overadvance” has the meaning specified therefor in Section 2.5 of the Agreement.

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“Parent” has the meaning specified thereof in the preamble to the Agreement.

“Participant” has the meaning specified therefor in Section 13.1(e) of the Agreement.

“Participant Register” has the meaning specified therefor in Section 13.1(i) of the Agreement.

“Patent Security Agreement” has the meaning specified therefor in the Security Agreement.

“Patriot Act” has the meaning specified therefor in Section 4.18 of the Agreement.

“Payoff Date” means the first date on which all of the Obligations are paid in full and the Revolver Commitments of the Lenders are terminated.

“PBGC” means the Pension Benefit Guaranty Corporation or any successor agency.

“Pension Plan” means any Employee Benefit Plan, other than a Multiemployer Plan, which is subject to the provisions of Title IV of ERISA or Section 412 of the IRC and which (a) is maintained, funded or administered by any Loan Party or any ERISA Affiliate or (b) has at any time within the preceding six (6) years been maintained, funded or administered any Loan Party or any current or former ERISA Affiliates.

“Permitted Acquisition” means any Acquisition by Parent or a Loan Party so long as:

(a) no Default or Event of Default shall have occurred and be continuing or would result from the consummation of the proposed Acquisition and the proposed Acquisition is consensual,

(b) no Indebtedness will be incurred, assumed, or would exist with respect to Parent or its Subsidiaries as a result of such Acquisition, other than Indebtedness permitted under clauses (f), (g), (m) or (x) of the definition of Permitted Indebtedness and no Liens will be incurred, assumed, or would exist with respect to the assets of Parent or its Subsidiaries as a result or such Acquisition other than Permitted Liens,

(c) Borrower has provided Agent with due diligence materials relative to the proposed Acquisition, including forecasted balance sheets, profit and loss statements, and cash flow statements of the Person or assets to be acquired, all prepared on a basis consistent with such Person’s (or assets’) historical financial statements, together with appropriate supporting details and a statement of underlying assumptions for the 1 year period following the date of the proposed Acquisition, on a quarter by quarter basis), in form and substance reasonably satisfactory to Agent,

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(d) Adjusted EBITDA (calculated as if the assets being acquired or the Person whose Stock is being acquired is Parent and its Subsidiaries on a consolidated basis for purposes of the definition of Adjusted EBITDA) attributable to the assets being acquired or the Person whose Stock is being acquired for the 12 consecutive month period most recently concluded prior to the date of the proposed Acquisition is not negative by more than 5% of Parent and its Subsidiary’s Adjusted EBITDA for then most recent Reference Period for which a Compliance Certificate containing a calculation thereof has been delivered to Agent,

(e) Borrower has provided Agent with written notice of the proposed Acquisition at least 15 Business Days prior to the anticipated closing date of the proposed Acquisition and, not later than 5 Business Days prior to the anticipated closing date of the proposed Acquisition, copies of the acquisition agreement and other material documents relative to the proposed Acquisition, which agreement and documents must be reasonably acceptable to Agent,

(f) the assets being acquired (other than a de minimis amount of assets in relation to Parent’s and its Subsidiaries’ total assets), or the Person whose Stock is being acquired, are useful in or engaged in, as applicable, the business of Parent and its Subsidiaries or a business reasonably related thereto,

(g) the assets being acquired (other than a de minimis amount of assets in relation to the assets being acquired) are located within the United States or the Person whose Stock is being acquired is organized in a jurisdiction located within the United States or any State, commonwealth, territory or possession thereof,

(h) the subject assets or Stock, as applicable, are being acquired directly by Borrower or one of its Subsidiaries that is a Loan Party, and, in connection therewith, Borrower or the applicable Loan Party shall have complied with Section 5.11 or 5.12, as applicable, of the Agreement, and

(i) the Specified Condition is satisfied and at least 5 Business Days prior to the anticipated closing date of the proposed Acquisition, Agent shall have received a certificate of a Responsible Officer of Parent demonstrating that the Specified Condition has been satisfied (and attaching the calculations with respect thereto).

“Permitted Additional Pari Passu Obligations” has the meaning specified therefor in the applicable Secured Notes Documents as in effect on the Closing Date.

“Permitted Discretion” means a determination made in good faith in the exercise of reasonable (from the perspective of an asset-based secured lender) business judgment.

“Permitted Dispositions” means:

(a) sales, abandonment, or other dispositions of equipment, machinery or other similar tangible assets that are (i) substantially worn, damaged, or obsolete or (ii) no longer used or useful in the business of Parent and its Subsidiaries,

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(b) sales of Inventory or damaged or abandoned or seized cargo to buyers in the ordinary course of business,

(c) the use or transfer of money or Cash Equivalents in a manner that is not prohibited by the terms of the Agreement or the other Loan Documents,

(d) the licensing of patents, trademarks, copyrights, and other intellectual property rights in the ordinary course of business in a manner that does not materially impair the conduct of the business or the value of the ABL Priority Collateral,

(e) the granting of Permitted Liens,

(f) the sale or discount, in each case without recourse, of Accounts arising in the ordinary course of business, but only in connection with the compromise or collection thereof,

(g) any involuntary loss, damage or destruction of property,

(h) any involuntary condemnation, seizure or taking, by exercise of the power of eminent domain or otherwise, or confiscation or requisition of use of property,

(i) the leasing or subleasing of assets of Parent or its Subsidiaries in the ordinary course of business, or assets related to the Non-Domestic Service,

(j) (i) the sale or issuance of Stock (other than Prohibited Preferred Stock) of Parent, (ii) the sale or issuance of Stock of any Loan Party to any other Loan Party, (iii) sale or issuance of Stock of any Non-Loan Party to any Non-Loan Party, and (iv) the sale or issuance of Stock of any Non-Loan Party to any Loan Party in connection with a Permitted Investment by such Loan Party,

(k) the lapse of or abandonment of patents, trademarks and other intellectual property of Parent and its Subsidiaries to the extent such asset is not material to the conduct of their business,

(l) the making of a Permitted Restricted Stock Payment,

(m) the making of a Permitted Investment,

(n) the Non-Domestic Reorganization,

(o) the disposition of cranes and related assets (or interests therein) located in Puerto Rico, Guam or Hawaii or originally purchased for use in Alaska;

(p) the sale, wind-up, shutdown or other disposition (in one or more transactions) of all or substantially all of the current business of Horizon Logistics, LLC and its Subsidiary Aero Logistics, LLC as integrated third-party logistics providers of transportation and distribution solutions (including transportation management, full truckload and less-than truckload transportation brokerage, international ocean transportation as a Non-Vessel Operating

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Common Carrier, expedited ground and international air, and warehousing and distribution services) to client-shippers requiring transportation services principally to, from and within North America (such business, the “Logistics Business”), whether such sale or sales, wind-up, shutdown or other dispositions are consummated pursuant to one or more dispositions of the Stock in such Subsidiaries and/or pursuant to one or more dispositions of the assets and liabilities of the Logistics Business,

(q) dispositions of assets (i) to any Loan Party, (ii) by any Non-Loan Party to any other Non-Loan Party and (iii) by any Loan Party to any Non-Loan Party in connection with a Permitted Investment by such Loan Party or otherwise made in compliance with Section 6.12(a), and

(r) so long as no Default or Event of Default has occurred and is continuing or would result therefrom, dispositions of assets (other than ABL Priority Collateral, Stock of Subsidiaries of Parent, or Material Contracts) not otherwise permitted in clauses (a) through (m) above so long as made at fair market value and the aggregate fair market value of all assets disposed of in all such dispositions since the Closing Date (including the proposed disposition) would not exceed $15,000,000,

provided that substantially concurrently with the disposition of any Accounts included in the Borrowing Base as a result of a Permitted Disposition, the Borrower shall deliver a revised Borrowing Base Certificate reflecting such disposition.

“Permitted Indebtedness” means:

(a) Indebtedness evidenced by the Agreement or the other Loan Documents, as well as Indebtedness owed to Underlying Issuers with respect to Underlying Letters of Credit,

(b) Indebtedness (other than Purchase Money Indebtedness) set forth on Schedule 4.19 and any Refinancing Indebtedness in respect of such Indebtedness (other than the Existing Notes),

(c) Permitted Purchase Money Indebtedness and any Refinancing Indebtedness in respect of such Indebtedness,

(d) endorsement of instruments or other payment items for deposit,

(e) Indebtedness consisting of (i) unsecured guarantees incurred in the ordinary course of business with respect to surety and appeal bonds, performance bonds, bid bonds, appeal bonds, completion guarantee and similar obligations; (ii) unsecured guarantees arising with respect to customary indemnification obligations to purchasers in connection with Permitted Dispositions; and (iii) unsecured guarantees with respect to Indebtedness of Parent or one of its Subsidiaries, to the extent that the Person that is obligated under such guaranty could have incurred such underlying Indebtedness,

(f) Indebtedness of Parent that is incurred on the date of the consummation of a Permitted Acquisition solely for the purpose of consummating such Permitted Acquisition so long as (i) no Default or Event of Default has occurred and is continuing or would result therefrom, (ii) such Indebtedness is not incurred for working capital purposes, and (iii) such Indebtedness does not mature prior to the date that is 91 days after the Maturity Date,

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(g) Acquired Indebtedness in an amount not to exceed $5,000,000 outstanding at any one time,

(h) Indebtedness incurred in the ordinary course of business under performance, surety, statutory, and appeal bonds,

(i) Indebtedness owed to any Person providing property, casualty, liability, or any other insurance to Parent or any of its Subsidiaries and other similar or deferred payment obligations in respect of insurance, so long as the amount of such Indebtedness is not in excess of the amount of the unpaid cost (and related fees, costs and expenses) of, and shall be incurred only to defer the cost of, such insurance for the year in which such Indebtedness is incurred and such Indebtedness is outstanding only during such year,

(j) the incurrence by Parent or its Subsidiaries of Indebtedness under Hedge Agreements that are incurred for the bona fide purpose of hedging the interest rate, commodity, or foreign currency risks associated with Parent’s and its Subsidiaries’ operations and not for speculative purposes,

(k) Indebtedness incurred in respect of credit cards, credit card processing services, debit cards, stored value cards, purchase cards (including so-called “procurement cards” or “P-cards”), or Cash Management Services, in each case, incurred in the ordinary course of business,

(l) unsecured Indebtedness of Parent owing to former employees, officers, or directors (or any spouses, ex-spouses, or estates of any of the foregoing) incurred in connection with the repurchase by Parent of the Stock of Parent that has been issued to such Persons, so long as (i) no Default or Event of Default has occurred and is continuing or would result from the incurrence of such Indebtedness, and (ii) the aggregate amount of all such Indebtedness outstanding at any one time does not exceed $2,500,000,

(m) Indebtedness owing to sellers of assets or Stock to a Loan Party that is incurred by the applicable Loan Party in connection with the consummation of one or more Permitted Acquisitions so long as (i) the aggregate principal amount for all such unsecured Indebtedness does not exceed $10,000,000 at any one time outstanding and (ii) it is otherwise on terms and conditions (including all economic terms and the absence of covenants) reasonably acceptable to Agent,

(n) contingent liabilities in respect of any indemnification obligation, adjustment of purchase price, non-compete, or similar obligation of Parent or the applicable Loan Party incurred in connection with the consummation of one or more Permitted Acquisitions,

(o) Indebtedness constituting Permitted Investments,

(p) Indebtedness of the Loan Parties consisting of:

(i) the Secured Notes (First Lien) in an aggregate principal amount not to exceed $225,000,000 at any time outstanding less the aggregate amount of principal repayments and redemptions with respect thereto made after the Closing Date, and Refinancing Indebtedness in respect thereof,

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(ii) the Secured Notes (Second Lien) in an aggregate principal amount not to exceed $100,000,000 at any time outstanding less the aggregate amount of principal repayments and redemptions with respect thereto made after the Closing Date, and Refinancing Indebtedness in respect thereof,

(iii) the Secured Notes (Convertible) in an aggregate principal amount not to exceed $280,000,000 at any time outstanding less the aggregate amount of conversions into common Stock of Parent, principal repayments and redemptions with respect thereto made after the Closing Date, and Refinancing Indebtedness in respect thereof,

(iv) the Additional Notes and Permitted Additional Pari Passu Obligations to the extent permitted to be issued and outstanding under the Secured Notes Documents as in effect on the date hereof in an aggregate outstanding principal amount, together with the aggregate principal amount of Vessel Financing Debt, not to exceed $50,000,000 at any time outstanding less the aggregate amount of principal repayments and redemptions with respect thereto made after the Closing Date (and Refinancing Indebtedness in respect of the foregoing), and

provided that, in each case, such Refinancing Indebtedness has no scheduled amortization or scheduled payment of principal prior to the 91^st day after the Maturity Date,

(q) Indebtedness in respect of workers’ compensation claims, unemployment or other insurance or self-insurance obligations, health, disability or other benefits to employees or former employees and their families, bankers’ acceptances, performance, completion and surety bonds, completion guarantees and similar obligations in the ordinary course of business,

(r) Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently drawn against insufficient funds, so long as such Indebtedness is covered within five Business Days and does not exceed $2,500,000 in the aggregate,

(s) to the extent constituting Indebtedness, obligations in respect of bankers’ acceptances, tender, bid, judgment, appeal, performance or governmental contract bonds and completion guarantees, surety, standby letters of credit and warranty and contractual service obligations of a like nature, trade letters of credit and documentary letters of credit and similar bonds or guarantees provided in the ordinary course of business in an aggregate amount not to exceed $2,500,000,

(t) Indebtedness in the form of unsecured notes to fund non-pro rata Stock buyback(s) in an amount not to exceed the minimum amount necessary to ensure compliance by any Loan Party of its agreement to be and remain a “citizen of the United States” within the

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meaning of 46 U.S.C. § 50501(a) and (d), eligible to own and operate vessels in the coastwise trade of the United States; provided that such Indebtedness has no scheduled amortization or payment of principal prior to the 91^st day after the Maturity Date,

(u) Indebtedness incurred to finance the replacement (through construction, acquisition, lease or otherwise) of one or more Vessels and the Vessel Related Assets in respect thereof, upon a total loss (including without limitation with respect to a Vessel, an actual, constructive, compromised, agreed or arranged total loss of such Vessel), destruction, condemnation, confiscation, requisition, seizure, forfeiture or other taking of title to or use of such Vessel (provided that such loss, destruction, condemnation, confiscation, requisition, seizure, forfeiture or other taking of title to or use of such Vessel was covered by insurance or resulted in the actual payment of compensation, indemnification or similar payments to such Person (collectively, a “Total Loss”)) in an aggregate amount no greater than the Ready for Sea Cost for such replacement Vessel, in each case, less all compensation, damages and other payments (including insurance proceeds other than in respect of business interruption insurance) actually received by Parent or any of its Subsidiaries from any Person in connection with the Total Loss in excess of amounts actually used to repay Indebtedness secured by the Vessel subject to the Total Loss,

(v) Indebtedness incurred in relation to (i) maintenance, repairs, refurbishments and replacements required to maintain the classification of or the U.S. Coast Guard-issued Certificate of Inspection for any of the Vessels owned, leased or bareboat chartered to or by the any Loan Party or any Subsidiary thereof, (ii) drydocking of any of the Vessels owned or leased by any Loan Party or any Subsidiary thereof for maintenance, repair, refurbishment or replacement purposes in the ordinary course of business; and (iii) any expenditures which will or may be reasonably expected to be recoverable from insurance on such Vessels,

(w) Indebtedness (which may include, for the avoidance of doubt, deferred or installment payment obligations) (“Vessel Financing Debt”), in an aggregate principal amount, together with the aggregate principal amount of Indebtedness outstanding pursuant to clause (p)(iv) above, not to exceed $50,000,000, incurred in order to repurchase, repay, refinance, redeem, defease or otherwise retire for value the all or any portion of the obligations of any Loan Party or any Subsidiary thereof with respect to ship financing arrangements (including those related to the Non-Domestic Service) in existence on the Closing Date, and any Refinancing Indebtedness in respect thereof, provided that (a)(i) the affirmative covenants and negative covenants (including financial maintenance covenants) are customary for financings of the applicable type of Permitted Indebtedness and, in any event, no more restrictive than the Loan Documents, (ii) the cross default provisions are not materially less favorable to the Loan Parties than those contained in the Secured Notes Documents as in effect on the Closing Date, and (iii) the other terms and conditions thereof (other than those covered by clause (b) or (c) below), taken as a whole, are not materially less favorable to the Loan Parties than those contained in the Secured Notes Documents as in effect on the Closing Date, in each case except to the extent approved by Agent (such approval not to be unreasonably withheld, delayed or conditioned), (b) the scheduled amortization for such Indebtedness shall be no greater than the scheduled amortization for the Secured Notes (First Lien) as in effect on the Closing Date for any period on or prior to the 91^st day following the Maturity Date, (c) the interest rates for any cash-pay interest

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(or portion of the total interest rate required to be regularly paid in cash), for such Indebtedness shall be no greater than 2.00% in excess of the applicable interest rates for the Secured Notes (Second Lien) as in effect on the Closing Date for any period on or prior to the 91^st day following the Maturity Date, and (d) such Indebtedness shall have a maturity date at least 91 days after the Maturity Date,

(x) additional Indebtedness in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Refinancing Indebtedness incurred to renew, refund, refinance, replace, defease or discharge any Indebtedness incurred pursuant to this clause (x), not to exceed $20,000,000, and

(y) the payment obligations with respect to the Antitrust Judgment and the Vessel Environmental Judgment.

Notwithstanding anything in the foregoing to the contrary, the accrual of interest, the accretion of accreted value, the payment of interest in the form of additional Indebtedness and the payment or accrual of premiums, fees and expenses in cash or in the form of additional Indebtedness shall not be deemed to be existing, or an incurrence of Indebtedness, for purposes any basket amount in this definition.

“Permitted Intercompany Investments” means Investments made by (a) a Loan Party to or in another Loan Party (other than Parent), (b) a Non-Loan Party to or in another Non-Loan Party, (c) a Non-Loan Party to or in a Loan Party, so long such Indebtedness is subordinated in right of payment to the Obligations on terms and conditions reasonably satisfactory to Agent and (d) a Loan Party to or in a Non-Loan Party so long as (i) the amount of such loans (together with all Investments made pursuant to clause (o) of the definition of Permitted Investments) does not exceed $2,500,000 outstanding at any one time and (ii) no Default or Event of Default has occurred and is continuing or would result therefrom.

“Permitted Investments” means:

(a) Investments in cash and Cash Equivalents,

(b) Investments in negotiable instruments deposited or to be deposited for collection in the ordinary course of business,

(c) advances made in connection with purchases of goods or services in the ordinary course of business,

(d) Investments received in settlement of amounts due to any Loan Party or any of its Subsidiaries effected in the ordinary course of business or owing to any Loan Party or any of its Subsidiaries as a result of Insolvency Proceedings involving an Account Debtor or upon the foreclosure or enforcement of any Lien in favor of a Loan Party or its Subsidiaries,

(e) Investments owned by any Loan Party or any of its Subsidiaries on the Closing Date and set forth on Schedule P-1,

(f) guarantees permitted under the definition of Permitted Indebtedness,

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(g) Permitted Intercompany Investments,

(h) Stock or other securities acquired in connection with the satisfaction or enforcement of Indebtedness or claims due or owing to a Loan Party or its Subsidiaries (in bankruptcy of customers or suppliers or otherwise outside the ordinary course of business) or as security for any such Indebtedness or claims,

(i) deposits of cash made in the ordinary course of business to secure performance of operating leases,

(j) non-cash loans to employees, officers, and directors of Parent or any of its Subsidiaries for the purpose of purchasing Stock in Parent so long as the proceeds of such loans are used in their entirety to purchase such stock in Parent,

(k) Permitted Acquisitions,

(l) Investments in the form of capital contributions and the acquisition of Stock made by any Loan Party in any other Loan Party (other than capital contributions to or the acquisition of Stock of Parent),

(m) Investments resulting from entering into (i) Bank Product Agreements, or (ii) agreements relative to Indebtedness that is permitted under clause (j) of the definition of Permitted Indebtedness,

(n) Investments held by a Person acquired in a Permitted Acquisition to the extent that such Investments were not made in contemplation of or in connection with such Permitted Acquisition and were in existence on the date of such Permitted Acquisition,

(o) any Investments received in compromise or resolution of litigation, arbitration or other disputes,

(p) Investments resulting from Hedging Obligations,

(q) loans and advances to officers, directors or employees (i) for business-related travel expenses, moving expenses and other similar expenses, including as part of a recruitment or retention plan, in each case incurred in the ordinary course of business, (ii) required by applicable employment laws and (iii) other loans and advances not to exceed $2,000,000 at any one time outstanding,

(r) prepaid expenses, and lease, utility, workers’ compensation and other deposits, if created, acquired or entered into in the ordinary course of business,

(s) payroll, business-related travel, and similar advances to cover matters that are expected at the time of such advances to be ultimately treated as expenses for accounting purposes and that are made in the ordinary course of business,

(t) Investments resulting from the prepayment of obligations of Parent and/or any of its Subsidiaries related to the payment or prepayment of ship financing arrangements (including those related to the Non-Domestic Service) in existence on the Closing Date or otherwise resulting from the Non-Domestic Reorganization,

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(u) so long as no Default or Event of Default has occurred and is continuing or would result therefrom, any other Investments (together with all Loans made pursuant to clause (d) of the definition of Permitted Intercompany Investments) in an aggregate amount not to exceed $5,000,000 during the term of the Agreement, and

(v) additional Investments not otherwise permitted in clauses (a) through (u) above so long as the Specified Condition is satisfied,

provided that no Acquisition shall be permitted hereunder that is not a Permitted Acquisition.

“Permitted Liens” means

(a) Liens granted to, or for the benefit of, Agent to secure the Obligations,

(b) Liens for unpaid taxes, assessments, or other governmental charges or levies that (i) are not yet delinquent, (ii) do not have priority over Agent’s Liens and the underlying taxes, assessments, or charges or levies are the subject of Permitted Protests, or (iii) have priority by operation of applicable law, are the subject of Permitted Protests and, to the extent that (A) any Loan Party has knowledge of such Lien (other than an inchoate Lien) or (B) the related taxes, assessments, charges or levies are overdue and unpaid or (C) the applicable Governmental Authority has recorded or filed such lien, in each case, such Loan Party shall have promptly notified Agent of the existence of such Liens and the related taxes, assessments, charges or levies but in any even within 5 days of such recording or filing),

(c) judgment Liens arising solely as a result of the existence of judgments, orders, or awards that do not constitute an Event of Default under Section 8.3 of the Agreement,

(d) Liens set forth on Schedule P-2; provided, however, that to qualify as a Permitted Lien, any such Lien described on Schedule P-2 shall only secure the Indebtedness that it secures on the Closing Date and any Refinancing Indebtedness in respect thereof,

(e) the rights, interests, Liens or title of lessors and sub-lessors under leases and licensors under license agreements or in the property being leased or licensed,

(f) purchase money Liens or the interests of lessors and sub-lessors under Capital Leases and/or Sale/Leaseback Transactions to the extent that such Liens or interests secure Permitted Purchase Money Indebtedness and so long as (i) such Lien attaches only to the asset purchased or acquired and the proceeds thereof, and (ii) such Lien only secures the Indebtedness that was incurred to acquire the asset purchased or acquired or any Refinancing Indebtedness in respect thereof,

(g) statutory Liens arising in favor of warehousemen, landlords, carriers, mechanics, materialmen, laborers, or suppliers, incurred in the ordinary course of business and not in connection with the borrowing of money, and which Liens either (i) are for sums not yet delinquent, or (ii) are the subject of Permitted Protests,

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(h) Liens on amounts deposited to secure Parent’s and its Subsidiaries obligations in connection with worker’s compensation or other unemployment insurance, employee-loyalty and/or disability benefits, and/or casualty insurance or self-insurance,

(i) Liens on amounts deposited to secure Parent’s and its Subsidiaries obligations in connection with the making or entering into of bids, tenders, or leases in the ordinary course of business and not in connection with the borrowing of money,

(j) Liens on amounts deposited to secure Parent’s and its Subsidiaries reimbursement obligations with respect to surety or appeal bonds obtained in the ordinary course of business,

(k) with respect to any Real Property, easements, rights of way, encroachments, zoning restrictions, title irregularities and similar matters or restrictions that do not materially interfere with or impair the use or operation thereof,

(l) licenses of patents, trademarks, copyrights, and other intellectual property rights in the ordinary course of business in any manner that does not materially impair the conduct of the business or the value of the ABL Priority Collateral,

(m) Liens that are replacements of Permitted Liens to the extent that the original Indebtedness is the subject of Refinancing Indebtedness and so long as the replacement Liens only encumber those assets that secured the original Indebtedness,

(n) rights of setoff, bankers’ liens and other Liens upon deposit accounts, securities accounts or commodities accounts in favor of banks or other depository intermediary or brokerage institutions, solely to the extent incurred (i) in connection with the maintenance of such deposit accounts, securities accounts or commodities accounts in the ordinary course of business or (ii) in respect of credit cards, credit card processing services, debit cards, stored value cards, purchase cards (including so-called “procurement cards” or “P-cards”), or Cash Management Services, in each case, incurred in the ordinary course of business,

(o) Liens granted in the ordinary course of business on the unearned portion of insurance premiums and other similar deferred payment obligations in connection therewith securing the financing of insurance premiums and other similar deferred payment obligations in connection therewith to the extent the financing is permitted under the definition of Permitted Indebtedness,

(p) Liens in favor of customs and revenue authorities arising as a matter of law to secure payment of customs duties in connection with the importation of goods,

(q) Liens solely on any earnest money deposits made by Parent or any of its Subsidiaries in connection with any letter of intent or purchase agreement with respect to a Permitted Acquisition,

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(r) Liens on assets (other than ABL Priority Collateral) in connection with Indebtedness permitted under clause (f) of Permitted Indebtedness; provided that such Indebtedness is subject to an intercreditor agreement having terms reasonably satisfactory to Agent,

(s) Liens on assets (other than ABL Priority Collateral) in connection with Indebtedness permitted under clause (m) of Permitted Indebtedness; provided that such Indebtedness is subject to an intercreditor agreement having terms reasonably satisfactory to Agent,

(t) Liens assumed by Parent or its Subsidiaries in connection with a Permitted Acquisition that secure Acquired Indebtedness,

(u) (i) Liens on the Collateral securing Indebtedness permitted under clause (p) of the definition of Permitted Indebtedness (other than clause (iv)), and (ii) Liens securing Indebtedness permitted under clause (p)(iv) of the definition of Permitted Indebtedness; provided that the holders of such Indebtedness (or their authorized representatives on their behalf) shall have entered into a joinder to the Intercreditor Agreement or such other documentation reasonably satisfactory to Agent agreeing to be bound by the terms thereof and to have the same rights and obligations thereunder as holders of the Secured Notes,

(v) Liens to secure the performance of tenders, completion guarantees, statutory obligations, surety, environmental or appeal bonds, bids, leases, government contracts, performance bonds or other obligations of a like nature incurred in the ordinary course of business,

(w) to the extent constituting Liens, options, put and call arrangements, rights of first refusal and similar rights relating to Permitted Investments in joint ventures,

(x) Liens arising from precautionary UCC financing statement filings regarding operating leases entered into by the Loan Parties or any of their Subsidiaries in the ordinary course of business or other precautionary UCC financing statement filings,

(y) Liens on Vessels and Vessel Related Assets incurred in the ordinary course of business of the Loan Parties or their Subsidiaries arising from Vessel chartering, drydocking, maintenance, repair, refurbishment or replacement, the furnishing of supplies, bunkers and other necessaries to Vessels and Vessel Related Assets, repairs and improvements to Vessels and Vessel Related Assets, crews’ wages, the wages of a stevedore, maritime Liens, Liens covered by insurance and any deductible applicable thereto, and other Liens filed in respect of any Vessel not otherwise constituting Permitted Liens under the foregoing of this clause (w) or clause (x); provided that the Loan Party shall cause any such Lien to be removed within 30 days of obtaining knowledge thereof except where (i) the validity or amount thereof is being contested in good faith by appropriate proceedings, (ii) the Loan Party has set aside on its books adequate reserves with respect thereto to the extent required by GAAP, (iii) such contest effectively suspends the enforcement of such Lien securing such obligation and (iv) neither the Vessel nor any interest therein has been arrested by reason thereof or would be in any danger of being sold, forfeited or lost during the pendency of such contest,

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(z) Liens on Vessels and Vessel Related Assets for salvage (including contract salvage) and general average,

(aa) Liens on Vessels and Vessel Related Assets securing Indebtedness incurred to finance the construction, purchase or lease of, or repairs, improvements or additions to, a Vessel (which term, for purposes of this clause (z), shall include the Capital Stock of a Person substantially all of the assets of which are Vessels and Vessel Related Assets, as the context may require), provided that (i) the principal amount of Indebtedness secured by such a Lien does not exceed (x) with respect to Indebtedness incurred to finance the construction of such Vessel, 87.5% of the sum of (1) the contract price pursuant to the Vessel Construction Contract for such Vessel and (2) any other Ready for Sea Cost for such Vessel, and (y) with respect to Indebtedness Incurred to finance the acquisition of such Vessel, 87.5% of the sum of (1) the contract price for the acquisition of such Vessel and (2) any other Ready for Sea Cost of such Vessel, (ii) in the case of Indebtedness that matures within nine months after the incurrence of such Indebtedness, the principal amount of Indebtedness secured by such a Lien shall not exceed the fair market value, as determined in good faith by the Board of Directors of Parent, of such Vessel at the time such Lien is incurred, (iii) in the case of a Sale/Leaseback Transaction, the principal amount of Indebtedness secured by such a Lien shall not exceed the fair market value, as determined in good faith by the Board of Directors of Parent, of such Vessel at the time such Lien is incurred and (iv) in the case of Indebtedness representing Capital Lease Obligations relating to a Vessel, the principal amount of Indebtedness secured by such a Lien shall not exceed 100% of the sum of (1) the fair market value, as determined in good faith by the Board of Directors of Parent, of such Vessel at the time such Lien is incurred and (2) any Ready for Sea Costs for such Vessel, provided, further, however that such Lien may not extend to any other property owned by such Loan Party or any of its Subsidiaries at the time the Lien is incurred and the Indebtedness (other than any interest thereon) secured by the Lien may not be incurred more than 180 days after the later of the acquisition, completion of construction, repair, improvement, addition or commencement of full operation of the property subject to the Lien,

(bb) Liens on Vessels and Vessel Related Assets in favor of the Maritime Administration in respect of guaranties provided thereby of Indebtedness incurred by the Loan Parties and their Subsidiaries for the purposes of acquiring or constructing new Vessels pursuant to 46 U.S.C. Chapter 537,

(cc) Liens on Collateral securing Vessel Financing Debt ranking junior to the Agent’s Liens on the ABL Priority Collateral; provided that such Indebtedness is subject to an intercreditor agreement with terms and conditions that are at least as favorable to Agent and the Lender Group as those in the Intercreditor Agreement (or otherwise reasonably satisfactory to Agent) in form and substance reasonably satisfactory to Agent,

(dd) Liens on assets (other than ABL Priority Collateral) securing Indebtedness incurred pursuant to clause (x) of the definition of Permitted Indebtedness; provided that (i) Agent has received written notice of the incurrence of such Indebtedness and (ii) if requested by Agent in its Permitted Discretion, such Indebtedness is subject to an intercreditor agreement having terms reasonably satisfactory to Agent, and

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(ee) Liens on assets (other than ABL Priority Collateral) not otherwise permitted under clauses (a) though (dd) above securing obligations in an amount not to exceed $1,500,000 at any time outstanding.

“Permitted Preferred Stock” means and refers to any Preferred Stock issued by Parent (and not by one or more of its Subsidiaries) that is not Prohibited Preferred Stock.

“Permitted Protest” means the right of Parent or any of its Subsidiaries to protest any Lien (other than any Lien that secures the Obligations), taxes (other than payroll taxes or taxes that are the subject of a United States federal tax lien), or rental payment, provided that (a) a reserve with respect to such obligation is established on Parent’s or its Subsidiaries’ books and records in such amount as is required under GAAP and (b) any such protest is instituted promptly and prosecuted diligently by Parent or its Subsidiary, as applicable, in good faith.

“Permitted Purchase Money Indebtedness” means, as of any date of determination, Purchase Money Indebtedness in an aggregate principal amount outstanding at any one time not in excess of $25,000,000.

“Permitted Restricted Debt Payments” means:

(a) Refinancing Indebtedness thereof permitted by Section 6.1,

(b) the payment of scheduled principal installments, if any, and interest in respect of subordinated Indebtedness (other than any such payment prohibited by the subordination provisions thereof),

(c) the payment of scheduled principal installments in respect of the Senior Notes and interest in respect thereof,

(d) Restricted Debt Payments of Indebtedness constituting Permitted Intercompany Investments; provided that no Default or Event of Default is continuing or would result therefrom,

(e) the conversion of the Secured Notes (Convertible) into common Stock of Parent (or into instruments representing rights with respect to common Stock),

(f) Restricted Debt Payments of the Senior Notes solely with the proceeds from any sale or other disposition of Secured Notes Priority Collateral and any premium owed with respect to such principal payment, and

(h) additional Restricted Debt Payments of the Senior Notes not otherwise permitted in clauses (a) through (f) above so long as the Specified Condition is satisfied.

“Permitted Restricted Stock Payments” means:

(a) (i) Restricted Stock Payments made by any Subsidiary of Parent to Parent or any wholly-owned Subsidiary of Parent and (ii) Restricted Stock Payments made in cash by any non-wholly-owned Subsidiary of Parent to its shareholders generally so long as Parent or its

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respective Subsidiary which owns the Stock in the Subsidiary paying such Restricted Stock Payments receives at least its proportionate share thereof (based upon its relative holding of the Stock in the Subsidiary paying such Restricted Stock Payments and taking into account the relative preferences, if any, of the various classes of Stock of such Subsidiary and any requirements imposed by applicable law); provided that any Restricted Stock Payment made by a Loan Party pursuant to clause (i) immediately above to a wholly-owned Subsidiary that is not a Loan Party may only be made if (1) no Default or Event of Default is continuing or would result therefrom and (2) such wholly-owned Subsidiary promptly distributes and/or transfer any assets received pursuant to such Restricted Stock Payment (directly or indirectly through other wholly-owned Subsidiaries) to a Loan Party,

(b) the redemption or purchase shares of Parent’s common Stock or options to purchase Parent’s common Stock, as the case may be, held by former officers or employees of Parent or any of its Subsidiaries following the death, disability, retirement or termination of employment of such officers or employees, provided that (i) the only consideration paid by Parent in respect of such redemptions and/or purchases shall be cash, and (ii) the aggregate amount paid by Parent in cash in respect of all such redemptions and/or purchases shall not exceed $3,000,000 in any fiscal year of Parent plus the proceeds of any key-man life insurance,

(c) Restricted Stock Payments, in accordance with Parent’s Governing Documents, to the holders of the Stock issued by Parent (i) solely with the proceeds of Indebtedness permitted pursuant to clause (q) of the definition of Permitted Indebtedness and (ii) so long as clauses (a) and (c) of the Specified Condition are satisfied, in an aggregate amount not to exceed the lesser of (A) $15,000,000 during the term of the Agreement and (B) the minimum amount necessary to ensure compliance by any Loan Party of its agreement to be and remain a “citizen of the United States” within the meaning of 46 U.S.C. § 50501(a) and (d), eligible to own and operate vessels in the coastwise trade of the United States, and

(d) additional Restricted Stock Payments not otherwise permitted in clauses (a) or (b) above so long as the Specified Condition is satisfied; provided that in no event shall this clause (d) permit additional Restricted Stock Payments described in clause (c) above or any other Restricted Stock Payments intended to ensure compliance by any Loan Party of its agreement to be and remain a “citizen of the United States” within the meaning of 46 U.S.C. § 50501(a) and (d), eligible to own and operate vessels in the coastwise trade of the United States, or to accomplish the same results.

“Person” means natural persons, corporations, limited liability companies, limited partnerships, general partnerships, limited liability partnerships, joint ventures, trusts, land trusts, business trusts, or other organizations, irrespective of whether they are legal entities, and governments and agencies and political subdivisions thereof.

“Preferred Stock” means, as applied to the Stock of any Person, the Stock of any class or classes (however designated) that is preferred with respect to the payment of dividends, or as to the distribution of assets upon any voluntary or involuntary liquidation or dissolution of such Person, over shares of Stock of any other class of such Person.

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“Prohibited Preferred Stock” means any Preferred Stock that by its terms is mandatorily redeemable or subject to any other payment obligation (including any obligation to pay dividends, other than dividends of shares of Preferred Stock of the same class and series payable in kind or dividends of shares of common stock) on or before a date that is less than 1 year after the Maturity Date, or, on or before the date that is less than 1 year after the Maturity Date, is redeemable at the option of the holder thereof for cash or assets or securities (other than distributions in kind of shares of Preferred Stock of the same class and series or of shares of common stock).

“Projections” means Parent’s forecasted (a) balance sheets, (b) profit and loss statements, and (c) cash flow statements, all prepared on a basis consistent with Parent’s historical financial statements, together with appropriate supporting details and a statement of underlying assumptions.

“Pro Rata Share” means, as of any date of determination:

(a) with respect to a Lender’s obligation to make Revolver Loans and right to receive payments of principal, interest, fees, costs, and expenses with respect thereto, (i) prior to the Revolver Commitments being terminated or reduced to zero, the percentage obtained by dividing (y) such Lender’s Revolver Commitment, by (z) the aggregate Revolver Commitments of all Lenders, and (ii) from and after the time that the Revolver Commitments have been terminated or reduced to zero, the percentage obtained by dividing (y) the outstanding principal amount of such Lender’s Revolver Loans by (z) the outstanding principal amount of all Revolver Loans,

(b) with respect to a Lender’s obligation to participate in Letters of Credit, Protective Advances, Swing Loans and Reimbursement Undertakings, to reimburse the Issuing Lender, Agent and the Swing Lenders, as applicable, and right to receive payments of fees with respect thereto, (i) prior to the Revolver Commitments being terminated or reduced to zero, the percentage obtained by dividing (y) such Lender’s Revolver Commitment, by (z) the aggregate Revolver Commitments of all Lenders, and (ii) from and after the time that the Revolver Commitments have been terminated or reduced to zero, the percentage obtained by dividing (y) the outstanding principal amount of such Lender’s Advances by (z) the outstanding principal amount of all Advances; provided, however, that if all of the Advances have been repaid in full and Letters of Credit remain outstanding, Pro Rata Share under this clause shall be determined based upon subclause (i) of this clause as if the Revolver Commitments had not been terminated or reduced to zero and based upon the Revolver Commitments as they existed immediately prior to their termination or reduction to zero, and

(c) with respect to all other matters as to a particular Lender (including the indemnification obligations arising under Section 15.7 of the Agreement), (i) prior to the Revolver Commitments being terminated or reduced to zero, the percentage obtained by dividing (y) such Lender’s Revolver Commitment, by (z) the aggregate amount of Revolver Commitments of all Lenders, and (ii) from and after the time that the Revolver Commitments have been terminated or reduced to zero, the percentage obtained by dividing (y) the outstanding principal amount of such Lender’s Advances, by (z) the outstanding principal amount of all Advances; provided, however, that if all of the Advances have been repaid in full and Letters of

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Credit remain outstanding, Pro Rata Share under this clause shall be determined based upon subclause (i) of this clause as if the Revolver Commitments had not been terminated or reduced to zero and based upon the Revolver Commitments as they existed immediately prior to their termination or reduction to zero.

“Protective Advances” has the meaning specified therefor in Section 2.3(d)(i) of the Agreement.

“Puerto Rico Settlement” means the settlement of certain class action lawsuits (which were consolidated into a single multidistrict litigation proceeding (case no. MDL1960) in the District of Puerto Rico), in each case involving any allegation of a violation of federal, state or other antitrust law by any of the Loan Parties or their Subsidiaries with respect to the ocean shipping business in the Puerto Rico trade lanes.

“Purchase Money Indebtedness” means Indebtedness (other than the Obligations, but including mortgage financings, Capitalized Lease Obligations and any obligations under Sale/Leaseback Transactions), incurred at the time of, or within 180 days after, the acquisition, development, construction, installation, expansion, repair or improvement of any fixed assets for the purpose of financing all or any part of the acquisition, development, construction, installation, expansion, repair or improvement cost thereof.

“Purchase Price” means, with respect to any Acquisition, an amount equal to the aggregate consideration, whether cash, property or securities (including the fair market value of any Stock of Parent issued in connection with such Acquisition and including the maximum amount of Earn-Outs), paid or delivered by Parent or one of its Subsidiaries in connection with such Acquisition (whether paid at the closing thereof or payable thereafter and whether fixed or contingent), but excluding therefrom (a) any cash of the seller and its Affiliates used to fund any portion of such consideration and (b) any cash or Cash Equivalents acquired in connection with such Acquisition.

“Ready for Sea Costs” means with respect to a Vessel or Vessels to be acquired or leased (pursuant to a Capital Lease Obligation) by any Loan Party or any Subsidiary thereof, the aggregate amount of expenditures incurred to acquire or construct and bring such Vessel or Vessels to the condition and location necessary for their intended use, including any and all inspections, appraisals, repairs, modifications, additions, permits and licenses in connection with such acquisition or lease, which would be classified and accounted for as “property, plant and equipment” in accordance with GAAP.

“Real Property” means any estates or interests in real property now owned or hereafter acquired by Parent or its Subsidiaries and the improvements thereto.

“Real Property Collateral” means the Real Property identified on Schedule R-1 and any Real Property hereafter acquired by Parent or its Subsidiaries.

“Recapitalization” means the Transactions, as well as any activities preceding the Transactions relating to (a) the second amendment to the Existing Credit Agreement dated as of March 9, 2011, (b) the third amendment to the Existing Credit Agreement dated as of June 24, 2011, (c) the fourth amendment to the Existing Credit Agreement dated as of September 13.

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2011, (d) the Bridge Credit Agreement, (e) any attempt to obtain consent or waiver from the holders of the Existing Notes in connection with the Antitrust Judgment or otherwise, (f) any proposed refinancing of the Existing Credit Agreement or the Indebtedness under the Existing Notes.

“Recapitalization Costs” means the fees and expenses incurred by (or reimbursable to third parties by) Parent, Borrower and any of their respective Subsidiaries in connection with the Recapitalization.

“Record” means information that is inscribed on a tangible medium or that is stored in an electronic or other medium and is retrievable in perceivable form.

“Reference Period” means any applicable period of 12 consecutive fiscal months.

“Refinancing Indebtedness” means refinancings, renewals, replacements, exchanges or extensions of Indebtedness so long as:

(a) such refinancings, renewals, replacements, exchanges or extensions do not result in an increase in the principal amount of the Indebtedness so refinanced, renewed, replaced, exchanged or extended, other than by the amount of premiums paid thereon, interest and fees accrued thereon and the fees and expenses incurred in connection therewith and by the amount of unfunded commitments with respect thereto,

(b) such refinancings, renewals, replacements, exchanges or extensions do not result in a shortening of the maturity date or the average weighted maturity (measured as of the refinancing, renewal, replacement, exchange or extension) of the Indebtedness so refinanced, renewed, replaced, exchanged or extended, nor are they on terms or conditions that, taken as a whole, are materially less favorable to the Loan Parties, taken as a whole, than those of the Indebtedness being refinanced, renewed, replaced, exchanged or extended,

(c) if the Indebtedness that is refinanced, renewed, replaced, exchanged or extended was subordinated (i) in right of payment to the Obligations or (ii) with respect to the priority of Liens to the Agent’s Liens, then, in each case, the terms and conditions of the refinancing, renewal, replacement, exchange or extension must include subordination and intercreditor terms and conditions that are at least as favorable to the Lender Group as those that were applicable to the refinanced, renewed, replaced, exchanged or extended Indebtedness,

(d) the Indebtedness that is refinanced, renewed, replaced, exchanged or extended is not recourse to any Person that is liable on account of the Obligations other than those Persons which were obligated with respect to the Indebtedness that was refinanced, renewed, replaced, exchanged or extended, and

(e) no Default or Event of Default is continuing or would result from such refinancing, renewal, replacement, exchange or extension.

“Register” has the meaning specified therefor in Section 13.1(h) of the Agreement.

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“Registered Loan” has the meaning specified therefor in Section 13.1(h) of the Agreement.

“Reimbursement Undertaking” has the meaning specified therefor in Section 2.11(a) of the Agreement.

“Related Fund” means, with respect to any Lender that is an investment fund, any other investment fund that invests in commercial loans and that is managed or advised by the same investment advisor as such Lender or by an Affiliate of such investment advisor.

“Remedial Action” means all actions taken to (a) clean up, remove, remediate, contain, treat, monitor, assess, evaluate, or in any way address Hazardous Materials in the indoor or outdoor environment, (b) prevent or minimize a release or threatened release of Hazardous Materials so they do not migrate or endanger or threaten to endanger public health or welfare or the indoor or outdoor environment, (c) restore or reclaim natural resources or the environment, (d) perform any pre-remedial studies, investigations, or post-remedial operation and maintenance activities, or (e) conduct any other actions with respect to Hazardous Materials required by Environmental Laws.

“Replacement Lender” has the meaning specified therefor in Section 2.13(b) of the Agreement.

“Report” has the meaning specified therefor in Section 15.16 of the Agreement.

“Required Lenders” means, at any time, Lenders whose aggregate Pro Rata Shares (calculated under clause (c) of the definition of Pro Rata Shares) exceed 50% (subject to Section 14.1(e) with respect to Defaulting Lenders); provided, however, that at any time there are 2 or more Lenders, “Required Lenders” must include at least 2 Lenders.

“Requirement of Law” means, as to any Person, the articles or certificate of incorporation and by-laws or other organizational or governing documents of such Person, and each law, treaty, rule or regulation or determination of an arbitrator or a court or other Governmental Authority, in each case applicable to or binding upon such Person or any of its property or to which such Person or any of its property is subject.

“Responsible Officer” means the chief executive officer, corporate secretary, the president, the controller, the chief financial officer or the treasurer of a Loan Party, as applicable, or any other officer having substantially the same authority and responsibility; or, with respect to compliance with financial covenants or delivery of financial information, the chief financial officer, the controller or the treasurer of a Borrower, as applicable, or any other officer having substantially the same authority and responsibility.

“Restricted Debt Payment” means any payment, prepayment, redemption, defeasance, purchase, distribution on account of, retirement or other acquisition of, or the setting apart of assets for a sinking or other analogous fund for the same or similar purpose with respect to (a) any Indebtedness that is subordinated in right of payment to the Obligations and (b) the Senior Notes; provided that, for avoidance of doubt, the foregoing shall not be construed to limit the payment of fees (other than fees in the nature of penalties, premiums or similar payments), expense reimbursements or indemnification payments required to be paid in connection with any such Indebtedness.

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“Restricted Stock Payment” means to (a) declare or pay any dividend or make any other payment or distribution on account of Stock issued by Parent (including any payment in connection with any merger or consolidation involving Parent) or to the direct or indirect holders of Stock issued by Parent, in each case, in their capacity as such (other than dividends or distributions payable in Stock (other than Prohibited Preferred Stock) issued by Parent, or (b) purchase, redeem, or otherwise acquire or retire for value (including in connection with any merger or consolidation involving Parent) any Stock issued by Parent.

“Revolver Commitment” means, with respect to each Lender, its Revolver Commitment, and, with respect to all Lenders, their Revolver Commitments, in each case as such Dollar amounts are set forth beside such Lender’s name under the applicable heading on Schedule C-1 or in the Assignment and Acceptance pursuant to which such Lender became a Lender under the Agreement, as such amounts may be reduced or increased from time to time pursuant to assignments made in accordance with the provisions of Section 13.1 of the Agreement.

“Revolver Loans” has the meaning specified therefor in Section 2.1(a) of the Agreement and, for avoidance of doubt, shall include Overadvances.

“Revolver Usage” means, as of any date of determination, the sum of (a) the amount of outstanding Advances, plus (b) the amount of the Letter of Credit Usage.

“Sanctioned Entity” means (a) a country or a government of a country, (b) an agency of the government of a country, (c) an organization directly or indirectly controlled by a country or its government, (d) a Person resident in or determined to be resident in a country, in each case, that is subject to a country sanctions program administered and enforced by OFAC.

“Sanctioned Person” means a person named on the list of Specially Designated Nationals maintained by OFAC.

“Sale/Leaseback Transaction” means any arrangement, directly or indirectly, between any Loan Party and an unrelated third party whereby such Loan Party shall sell or transfer any property, real or personal, used or useful in its business, whether now owned or hereafter acquired, and thereafter rent or lease such property or other property from such third party which such Loan Party intends to use for substantially the same purpose or purposes as the property being sold or transferred.

“S&P” has the meaning specified therefor in the definition of Cash Equivalents.

“SEC” means the United States Securities and Exchange Commission and any successor thereto.

“Secured Notes” means, collectively, the Secured Notes (Convertible), the Secure Notes (First Lien) and the Secured Notes (Second Lien).

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“Secured Notes (Convertible)” means, collectively the Convertible Secured Notes due April 15, 2017 in an aggregate principal amount not to exceed $280,000,000, which have been issued by Parent pursuant to and are subject to the Secured Notes Indenture (Convertible).

“Secured Notes (First Lien)” means the 11% First Lien Secured Notes due October 15, 2016 in an aggregate principal amount not to exceed $225,000,000, which have been issued by Borrower pursuant to and are subject to the Secured Notes Indenture (First Lien).

“Secured Notes (Second Lien)” means, collectively the Second Lien Secured Notes due October 15, 2016 in an aggregate principal amount not to exceed $100,000,000 plus any accretions or paid-in-kind interest thereon, which have been issued by Borrower pursuant to and are subject to the Secured Notes Indenture (Second Lien).

“Secured Notes Documents” means, collectively, the Secured Notes Documents (Convertible), the Secure Notes Documents (First Lien) and the Secured Notes Documents (Second Lien).

“Secured Notes Documents (Convertible)” means, collectively, the Secured Notes Indenture (Convertible) and all other loan agreements, indentures, note purchase agreements, promissory notes, guarantees, intercreditor agreements, assignment and assumption agreements and other instruments and agreements evidencing the terms of the Secured Notes (Convertible), including a security agreement with a collateral description and Lien structure similar to that of the Agreement and satisfactory to Agent.

“Secured Notes Documents (First Lien)” means, collectively, the Secured Notes Indenture (First Lien) and all other loan agreements, indentures, note purchase agreements, promissory notes, guarantees, intercreditor agreements, assignment and assumption agreements and other instruments and agreements evidencing the terms of the Secured Notes (First Lien), including a security agreement with a collateral description and Lien structure similar to that of the Agreement and satisfactory to Agent.

“Secured Notes Documents (Second Lien)” means, collectively, the Secured Notes Indenture (Second Lien) and all other loan agreements, indentures, note purchase agreements, promissory notes, guarantees, intercreditor agreements, assignment and assumption agreements and other instruments and agreements evidencing the terms of the Secured Notes (Second Lien), including a security agreement with a collateral description and Lien structure similar to that of the Agreement and satisfactory to Agent.

“Secured Notes Indenture (Convertible)” means that certain Indenture, dated as of October 5, 2011, among Parent, the Borrower, the other Guarantors and U.S. Bank National Association, as trustee.

“Secured Notes Indenture (First Lien)” means that certain Indenture, dated as of October 5, 2011, among Parent, the Borrower, the other Guarantors and U.S. Bank National Association, as trustee.

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“Secured Notes Indenture (Second Lien)” means that certain Indenture, dated as of October 5, 2011, among Parent, the Borrower, the other Guarantors and U.S. Bank National Association, as trustee.

“Secured Notes Priority Collateral” means Notes Priority Collateral (as defined in the Intercreditor Agreement).

“Securities Account” means a securities account (as that term is defined in the Code).

“Securities Act” means the Securities Act of 1933, as amended from time to time, and any successor statute.

“Security Agreement” means a security and pledge agreement, dated as of even date with the Agreement, in form and substance reasonably satisfactory to Agent, executed and delivered by Borrower and Guarantors to Agent.

“Senior Notes” means the Secured Notes, the Additional Notes, the Permitted Additional Pari Passu Obligations and the Vessel Financing Debt (and any Refinancing Indebtedness in respect of the foregoing), or any one of them, as the context may require.

“Settlement” has the meaning specified therefor in Section 2.3(e)(i) of the Agreement.

“Settlement Date” has the meaning specified therefor in Section 2.3(e)(i) of the Agreement.

“Shipco” means CSX Alaska Vessel Company, LLC, a Subsidiary of CSX.

“Solvent” means, with respect to any Person or consolidated group of Persons, taken as a whole (a “Group”), as the context may require, on a particular date, that:

(a) the fair value of the assets of such Person or Group is greater than the total amount of liabilities, including contingent, subordinated, absolute, fixed, matured or unmatured and liquidated or unliquidated liabilities, of such Person or Group,

(b) the present fair saleable value of the assets of such Person or Group exceeds (i) the amount that will be required to pay the probable liability of such Person or Group on its debts as such debts become absolute and matured and (ii) the total liabilities of such Person or Group (including, without limitation, subordinated, unmatured, unliquidated and known contingent liabilities),

(c) such Person or Group will be able to pay their debts and other liabilities, contingent obligations and other commitments as they mature in the normal course of business,

(d) such Person or Group is not engaged in business or any transaction, or is about to engage in business or any transaction, for which its property would constitute unreasonably small capital, and

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(e) such Person or Group is not “insolvent” as such term is defined in Section 101(32) of Title 11 of the United States Code, 11 U.S.C. Section 101, et. seq.

“Specified Condition” means, with respect to the making of any Specified Event (a) Excess Availability for the 30 consecutive days ending on the date of such Specified Event (including the date thereof) (calculated on a pro forma basis after giving effect to such Specified Event), plus, so long as there are no outstanding Advances on the date of such Specified Event, the Specified Liquidity Amount, shall not be less than $40,000,000, (b) the Fixed Charge Coverage Ratio shall be greater than 1.00 to 1.00 (calculated on a pro forma basis after giving effect to such Specified Event), and (c) no Default or Event of Default is continuing or would result from such Specified Event.

“Specified Event” means the making of, or entering into, a Permitted Acquisition, a Permitted Investment, a Permitted Restricted Stock Payment or a Permitted Restricted Debt Payment, in each case, which expressly references the Specified Condition.

“Specified Liquidity Amount” means, with respect to any Specified Event, an amount up to $10,000,000, which amount shall be on deposit in an account at the Agent or any of its Affiliates subject to a first priority perfected security interest (subject only to Permitted Liens) in favor of Agent and available for withdrawal by Borrower no earlier than 5 Business Days after the occurrence of such Specified Event.

“Stock” means all shares, options, warrants, interests, participations, or other equivalents (regardless of how designated) of or in a Person, whether voting or nonvoting, including common stock, preferred stock, or any other “equity security” (as such term is defined in Rule 3a11-1 of the General Rules and Regulations promulgated by the SEC under the Exchange Act).

“Subsidiary” of a Person means a corporation, partnership, limited liability company, or other entity in which that Person directly or indirectly owns or controls the shares of Stock having ordinary voting power to elect a majority of the Board of Directors (or appoint other comparable managers) of such corporation, partnership, limited liability company, or other entity.

“Swing Lender” means WFCF or any other Lender that, at the request of Borrower and with the consent of Agent agrees, in such Lender’s sole discretion, to become the Swing Lender under Section 2.3(b) of the Agreement.

“Swing Loan” has the meaning specified therefor in Section 2.3(b) of the Agreement.

“Taxes” means any taxes, levies, imposts, duties, fees, assessments or other charges of whatever nature now or hereafter imposed by any jurisdiction or by any political subdivision or taxing authority thereof or therein and all interest, penalties or similar liabilities with respect thereto; provided, however, that Taxes shall exclude the following, including any interest or penalties with respect thereto (i) any tax imposed on the net income or net profits of Agent, any Underlying Issuer, any Lender or any Participant (including any branch profits or similar taxes), in each case imposed by the jurisdiction (or by any political subdivision or taxing

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authority thereof) in which Agent, such Underlying Issuer, such Lender or such Participant is organized or the jurisdiction (or by any political subdivision or taxing authority thereof) in which Agent’s, such Underlying Issuer’s, such Lender’s or such Participant’s principal office is located; (ii) taxes resulting from Agent’s, such Underlying Issuer’s, such Lender’s or such Participant’s failure (other than as a result of a Change in Law) to comply with the requirements of Section 16(c) or (d) of the Agreement, (iii) U.S. federal withholding Taxes imposed under FATCA, and (iv) any United States federal withholding taxes that would be imposed on amounts payable to a Lender or Participant based upon the applicable withholding rate in effect at the time such Person becomes a party to the Agreement (or designates a new lending office), except that Taxes shall include (A) any amount that such Person (or its assignor, if any) was previously entitled to receive pursuant to Section 16(a) of the Agreement, if any, with respect to such withholding tax at the time such Person becomes a party to the Agreement (or designates a new lending office), and (B) United States federal withholding taxes that may be imposed after the time such Person becomes a party to the Agreement (or designates a new lending office), as a result of a Change in Law, rule, regulation, treaty, order or other decision with respect to any of the foregoing by any Governmental Authority.

“Tax Lender” has the meaning specified therefor in Section 14.2(a) of the Agreement.

“Termination Event” means the occurrence of any of the following which, individually or in the aggregate, has resulted or could reasonably be expected to result in liability of Borrower in an aggregate amount in excess of $10,000,000 (a) a “Reportable Event” described in Section 4043 of ERISA for which the thirty (30) day notice requirement has not been waived by the PBGC, or (b) the withdrawal of any Loan Party or any ERISA Affiliate from a Pension Plan 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, or (c) the termination of a Pension Plan, the filing of a notice of intent to terminate a Pension Plan or the treatment of a Pension Plan amendment as a termination, under Section 4041 of ERISA, if the plan assets are not sufficient to pay all plan liabilities, or (d) the institution of proceedings to terminate, or the appointment of a trustee with respect to, any Pension Plan by the PBGC, or (e) any other event or condition which would constitute grounds under Section 4042(a) of ERISA for the termination of, or the appointment of a trustee to administer, any Pension Plan, or (f) the imposition of a Lien pursuant to Section 430(k) of the IRC or Section 303 of ERISA, or (g) the determination that any Pension Plan or Multiemployer Plan is considered an at-risk plan or plan in endangered or critical status with the meaning of Sections 430, 431 or 432 of the IRC or Sections 303, 304 or 305 of ERISA or (h) the partial or complete withdrawal of any Loan Party or any ERISA Affiliate from a Multiemployer Plan if withdrawal liability is asserted by such plan, or (i) any event or condition which results in the reorganization or insolvency of a Multiemployer Plan under Sections 4241 or 4245 of ERISA, or (j) any event or condition which results in the termination of a Multiemployer Plan under Section 4041A of ERISA or the institution by PBGC of proceedings to terminate a Multiemployer Plan under Section 4042 of ERISA, or (k) 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 any Loan Party or any ERISA Affiliate.

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“TP1 Service” means the trans-Pacific service preceding the Non-Domestic Service in which Parent and its Subsidiaries used vessels not qualified for operation in the coastwise trade of the United States.

“Trademark Security Agreement” has the meaning specified therefor in the Security Agreement.

“Transactions” means collectively, (a) the repayment, in full, of the outstanding principal, accrued interest, and accrued fees and expenses owing under or in connection with the Existing Credit Agreement, (b) the entering into of the Loan Documents and the incurrence of all Advances and the issuance of all Letters of Credit on the Closing Date, (c) the issuance of the Secured Notes (First Lien) and the Secured Notes (Second Lien), (d) the issuance of the Secured Notes (Convertible) and common Stock of Parent in exchange for the Existing Notes and (e) the payment of fees and expenses in connection with the foregoing.

“Trigger Amount” means the greater of (a) $12,500,000 and (b) 12.5% of the Maximum Revolver Amount.

“Trigger Period” means the period (a) commencing on the date that an Event of Default occurs, or Excess Availability is less than the Trigger Amount and (b) continuing until, during the preceding consecutive 45 days, no Event of Default exists and Excess Availability is equal to or greater than the Trigger Amount at all times.

“Underlying Issuer” means Wells Fargo or one of its Affiliates.

“Underlying Letter of Credit” means a Letter of Credit that has been issued by an Underlying Issuer.

“Unfinanced Capital Expenditures” means, for any period, the Capital Expenditures made by Parent and its Subsidiaries during such period, which Capital Expenditures are not financed from the proceeds of any Indebtedness (other than the Revolver Loans, it being agreed that, to the extent financed with Revolver Loans, such Capital Expenditures shall be deemed Unfinanced Capital Expenditures).

“United States” means the United States of America.

“U.S. Person” means a “United States person” as defined in Section 7701(a)(30) of the IRC.

“Voidable Transfer” has the meaning specified therefor in Section 17.8 of the Agreement.

“Vessel” has the meaning specified therefor in the Security Agreement.

“Vessel Construction Contract” means any contract for the construction (or construction and acquisition) of a Vessel entered into by any Loan Party or any Subsidiary thereof, including any amendments, supplements or modifications thereto or change orders in respect thereof.

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“Vessel Environmental Judgment” has the meaning specified therefor in the definition of Vessel Environmental Judgment Lien.

“Vessel Environmental Judgment Lien” means the Lien, if any, securing the obligations of Parent and its Subsidiaries with respect to the fines and penalties (the “Vessel Environmental Judgment”) in an aggregate amount not to exceed $1,600,000 that may be assessed against Parent and Borrower as a result of the settlement of the investigation into certain environmental issues pertaining to the use and operation of certain of Borrower’s Vessels by the Unites States Coast Guard and United States Attorney for the Northern and Central Districts of California described under the heading “Environmental Matters” in Part II of the Parent’s Form 10-Q Report for the period ended June 26, 2011, pursuant to which judgment the Parent and its Subsidiaries shall be required to make payments in substantially the amounts previously disclosed in writing to Agent prior to the Closing Date.

“Vessel Fleet Mortgage” has the meaning specified therefor in the Security Agreement.

“Vessel Financing Debt” has the meaning specified therefor in clause (w) of the definition of Permitted Indebtedness.

“Vessel Related Assets” means with respect to any Vessel, the fixed assets attached to or maintained on such Vessel and all related spares and equipment and any additional improvements thereto, but in no event shall Vessel Related Assets include any assets that constitute ABL Priority Collateral.

“Wells Fargo” means Wells Fargo Bank, National Association, a national banking association.

“WFCF” means Wells Fargo Capital Finance, LLC, a Delaware limited liability company.

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Schedule 3.1

Conditions Precedent

The obligation of each Lender to make its initial Extension of Credit provided for in the Agreement is subject to the satisfaction or waiver, of each of the following conditions precedent (the making of such initial Extension of Credit being conclusively deemed to be the satisfaction or waiver of all of the following:

(a) the Closing Date shall occur on or before October 31, 2011;

(b) Agent shall have received the results of Lien searches (including a search as to judgments, pending litigation and tax matters) for the jurisdiction of organization of each Loan Party and the jurisdiction of the chief executive office of each Loan Party, which, solely with respect to ABL Priority Collateral, such search results shall be reasonably satisfactory to Agent;

(c) Agent shall have received (i) UCC-1 financing statements in form appropriate for filing in each Loan Parties’ jurisdiction of organization and (ii) agreements, documents and instruments reasonably necessary to perfect the Agent’s Liens to the extent required under the Loan Documents to be perfected as of the Closing Date, other than those agreements, documents and instruments identified on Schedule 3.6;

(d) Agent shall have received each of the following documents, duly executed by the Loan Party party thereto:

(i) the Agreement,

(ii) the promissory notes requested by any Lender at least 2 Business Days prior to the Closing Date, if any,

(iii) the Guaranty,

(iv) the Security Agreement,

(v) the Intercreditor Agreement,

(vi) a disbursement letter executed and delivered by Borrower to Agent regarding the Extensions of Credit to be made under the Agreement on the Closing Date, the form and substance of which is reasonably satisfactory to Agent,

(vii) a payoff letter, in form and substance reasonably satisfactory to Agent, from Wells Fargo Bank, N.A., as administrative agent (“Existing Agent”) for the lenders (“Existing Lenders”) party to the Existing Credit Agreement, respecting the amount necessary to repay in full all of the obligations of Parent and its Subsidiaries owing to Existing Agent and Existing Lenders under the Existing Credit Agreement (other than the Existing Letters of Credit) and releasing all of the Liens existing in favor of Existing Agent in and to the assets of

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Parent and its Subsidiaries, together with termination statements and other documentation evidencing the termination by Existing Lender of its Liens in and to the properties and assets of Parent and its Subsidiaries; and

(viii) a payoff letter, in form and substance reasonably satisfactory to Agent, from Cantor Fitzgerald Securities, as administrative agent (the “Bridge Agent”) for the lenders (“Bridge Lenders”) party to the Bridge Credit Agreement, respecting the amount necessary to repay in full all of the obligations of Parent and its Subsidiaries owing under the Bridge Credit Agreement and releasing all of the Liens existing in favor thereof in and to the assets of Parent and its Subsidiaries, together with termination statements and other documentation evidencing the termination thereby of its Liens in and to the properties and assets of Parent and its Subsidiaries;

(e) Agent shall have received a certificate from the Secretary of Borrower (i) attesting to the resolutions of Borrower’s Board of Directors authorizing its execution, delivery, and performance of the Agreement and the other Loan Documents to which Borrower is a party, (ii) authorizing specific officers of Borrower to execute the same, and (iii) attesting to the incumbency and signatures of such specific officers of Borrower;

(f) Agent shall have received copies of each Loan Parties’ Governing Documents, as amended, modified, or supplemented to the Closing Date, certified by the appropriate officer of the jurisdiction of organization of such Loan Party and the Secretary of such Loan Party;

(g) Agent shall have received a certificate of status with respect to each Loan Party, dated within 20 days of the Closing Date, such certificate to be issued by the appropriate officer of the jurisdiction of organization of such Loan Party, which certificate shall indicate that such Loan Party is in good standing in each such jurisdiction;

(h) Agent shall have received certificates of insurance and endorsements as are required by Section 5.6, the form and substance of which shall be reasonably satisfactory to Agent;

(i) Agent shall have received a legal opinion from Kirkland and Ellis LLP, legal counsel to the Loan Parties, and Carlsmith Ball LLP, as special Hawaii counsel to Hawaii Stevedores, Inc., each addressed to Agent and each Lender and otherwise in form and substance reasonably satisfactory to Agent;

(j) Agent shall have received (i) a Borrowing Base Certificate from Borrower, calculating the Borrowing Base as of the most recent month-end occurring at least 10 days prior to the Closing Date (based on the confirmatory field exam conducted within a reasonable period of time prior to the Closing Date) and certifying that Excess Availability together with cash on hand of the Loan Parties, after giving effect to the consummation of the Transactions, is not less than $40,000,000 and (ii) a solvency certificate certified by the chief financial officer or treasurer of Parent in form and substance satisfactory to Agent;

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(k) Agent shall have (i) completed customary “bring-down” due diligence, with results reasonably satisfactory to Agent and (ii) completed a confirmatory field exam of the Loan Parties and the Collateral in accordance with Agent’s customary procedures and practices and as otherwise required by the nature and circumstances of the businesses of the Loan Parties and the Collateral, reflecting that the Borrower has Excess Availability, together with cash on hand of the Loan Parties, of at least $40,000,000 as required by clause (j) above;

(l) Agent shall have completed (i) customary Patriot Act searches, OFAC/PEP searches and customary individual background checks for Parent, and (ii) OFAC/PEP searches and customary individual background searches for Parent’s senior management and key principals, and each Guarantor, the results of which shall be satisfactory to Agent and Lenders;

(m) Agent shall have received (i) copies of interim unaudited consolidated financial statements of Parent and its Subsidiaries for the most recent month-end occurring not less than 30 days prior to the Closing Date, (ii) a set of Projections of Parent and its Subsidiaries prepared by management of Parent, which shall be quarterly from the Closing Date through the end of the first four fiscal quarters following the Closing Date and annually thereafter for the term of the Agreement, and (iii) an opening pro forma balance sheet of Parent and its Subsidiaries as of the date of the most recent unaudited consolidated financial statements referred to in clause (i), but giving effect to the Transactions on the Closing Date, all in form and substance (including as to scope and underlying assumptions) reasonably satisfactory to Agent;

(n) Borrower shall have paid all Lender Group Expenses incurred in connection with the transactions evidenced by the Agreement;

(o) All fees and reasonable out-of-pocket expenses that have been properly documented and are in each case due and payable to WFCF, the Agent and counsel to the Agent on the Closing Date pursuant to the Fee Letter, the Commitment Letter, dated as of August 26, 2011 between WFCF and Parent, including the Term Sheet attached thereto, shall have been, or substantially concurrently with the consummation of the Transactions on the Closing Date shall be, paid;

(p) Agent shall have received copies of each Material Contract (except to the extent not permitted to be disclosed pursuant to confidentially obligations of the Loan Parties or their Subsidiaries);

(q) (i) the Secured Notes (First Lien), in an aggregate principal amount of $225,000,000, the Secured Notes (Second Lien), in an aggregate principal amount of $100,000,000, and the Secured Notes (Convertible), in an aggregate principal amount of $280,000,000, shall have been, or substantially concurrently with the effectiveness of the Agreement shall be, issued on terms and conditions reasonably satisfactory to Agent and Borrower shall have received the net proceeds of the Secured Notes (other than the portion thereof constituting loans under the Bridge Loan Facility converted to Secured Notes) substantially simultaneously with the Closing Date, and (ii) all or substantially all (but in no event shall more than $20,000,000 in principal amount of the Existing Notes remain outstanding on the Closing Date after giving effect to the Transactions and any remaining Existing Notes

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shall remain unsecured and the documents evidencing the Existing Notes shall be amended to remove substantially all of the restrictive covenants and certain events of default thereunder other than the required repayment thereof) of the outstanding principal amount of the Existing Notes shall have been exchanged for the Secured Notes (Convertible) and approximately $50,000,00 of common Stock of Parent, each on terms and conditions reasonably satisfactory to Agent.

(r) Agent shall have received a certificate signed by a Responsible Officer of Parent, which certifies and attaches copies of the final and executed Secured Notes Indenture (Convertible), Secured Notes Indenture (First Lien), Secured Notes Indenture (Second Lien), each of the final and executed security agreements with respect thereto, and each of the final and executed note purchase agreements with respect thereto;

(s) the pro forma capital and ownership structure and the shareholding arrangements of Parent and its Subsidiaries, after giving effect to the Transactions, shall be substantially consistent with the description thereof delivered to Agent on or prior to August 26, 2011;

(t) Parent and its Subsidiaries shall have received all governmental and third-party approvals necessary, if any, in connection with the consummation of the Transactions, which shall all be in full force and effect, unless the absence of any such approval could not reasonably be expected to result in a Material Adverse Change;

(u) to the extent required by, or delivered to, the trustee under the Secured Notes on the Closing Date, Agent shall have received copies of all such possessory Collateral constituting Notes Priority Collateral; and

(v) Agent shall have received a certificate signed by a Responsible Officer of Parent which certifies that each Loan Party that owns or operates vessels in the coastwise trade of the United States is a “citizen of the United States” within the meaning of 46 U.S.C. § 50501(a) and (d).

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SCHEDULE 3.6

CONDITIONS SUBSEQUENT

1. Promptly after the Closing Date, Agent shall have received a Coast Guard form CG-1330, Certificate of Ownership, covering the Vessels subject to the Vessel Fleet Mortgages, evidencing recordation of the Vessel Fleet Mortgage in favor of Agent and copies of each Vessel Fleet Mortgage certified by the U.S. Coast Guard National Vessel Documentation Center.

2. Promptly after the Closing Date, Agent shall have received a legal opinion from Blank Rome LLP, maritime legal counsel to the Loan Parties in the form agreed to immediately prior to the Closing Date,

3. Promptly after the Closing Date each applicable Loan Party shall amend its limited liability company operating agreement, partnership agreement, bylaws and other formation documents to remove any references to a Credit Agreement dated February 26, 2003 among inter alia, Horizon Lines, LLC and ABN AMRO Bank, N.V. as administrative agent.

4. Within 5 Business Days after the Closing Date, Agent shall have received a monthly schedule of the Non-Domestic Service losses for fiscal year 2011 referenced in clause (c)(xxii) of the definition of Adjusted EBITDA.

5. Within 10 days after the Closing Date, Agent shall have received for the fiscal month ended September 25, 2011, each of the items identified in clauses (a) through (g) of Schedule 5.2.

6. Within 15 days after the Closing Date, Agent shall have received certificates of property insurance as are required by Section 5.6, with a schedule of properties attached thereto and otherwise in the form agreed to immediately prior to the Closing Date.

7. Within 40 days after the Closing Date, Agent shall have received for the fiscal quarter ended September 25, 2011, the quarterly financial statements identified in clause (c) of Schedule 5.1.

8. Within 60 days after the Closing Date, Agent shall have received, with respect to each Deposit Account and Security Account (other than Excluded Accounts), executed Control Agreements; provided that upon the commencement of any Trigger Period, such Control Agreements will be delivered to Agent within 5 Business Days thereafter (as such date may be extended by the Agent in its sole discretion).

9. At such time as, and to the extent required by, or delivered to, the trustee under the Secured Notes: (a) a certificate executed by an officer of Parent that includes a schedule setting forth the model, model year, identification number and location of all CoT Chassis owned by each Loan Party, along with representations by the Parent as to the accuracy in all material respects of the information set forth on such schedule and (b) evidence that Agent’s Lien has been noted on the certificates of title with respect to the CoT Chassis owned by the Loan Parties to the extent multiple lien holders can be noted thereon.

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Schedule 5.1

Financial Statements, Reports, Certificates

Deliver to Agent each of the financial statements, reports, or other items set forth below at the following times in form satisfactory to Agent:

as soon as available, but in any event within 30 days (45 days in the case of a month that is the end of one of Parent’s fiscal quarters) after the end of each fiscal month during each of Parent’s fiscal years,	(a) an unaudited consolidated and consolidating balance sheet, income statement, and statement of cash flow covering Parent’s and its Subsidiaries’ operations during such period and compared, in the case of such balance sheet, to the end of the prior fiscal year, and in the case of such statements of income and cash flow, to the prior year period and plan and (b) a Compliance Certificate attaching (i) the financial statements described in clause (a) above, (ii) the Excess Availability Calculation, the Leverage Ratio Calculation, the calculation of Fixed Charge Coverage Ratio and the calculation of Adjusted EBITDA, each in form and containing sufficient detail satisfactory to Agent, (iii) a schedule of all Hedge Agreements entered into by Parent or any of its Subsidiaries with any Lender and/or any Affiliates of any Lender, which schedule shall show whether such Hedge Agreement is secured pursuant to any of the Loan Documents.
as soon as available, but in any event within 45 days after the end of each fiscal quarter during each of Parent’s fiscal years,	(c) an unaudited consolidated and consolidating balance sheet, income statement, statement of cash flow, and statement of shareholder’s equity covering Parent’s and its Subsidiaries’ operations during such period, and compared to the prior year period and plan, together with a corresponding discussion and analysis of results from management and (d) a Compliance Certificate attaching (i) the financial statements described in clause (a) above, (ii) the Excess Availability Calculation, the Leverage Ratio Calculation, the calculation of Fixed Charge Coverage Ratio and the calculation of Adjusted EBITDA, each in form and containing sufficient detail satisfactory to Agent, (iii) a schedule of all Hedge Agreements entered into by Parent or any of its Subsidiaries with any Lender and/or any Affiliates of any Lender, which schedule shall show whether such Hedge Agreement is secured pursuant to any of the Loan Documents.
as soon as available, but in any event within 90 days after the end of each of Parent’s fiscal years,	(e) consolidated and consolidating financial statements of Parent and its Subsidiaries for each such fiscal year, audited by independent certified public accountants reasonably acceptable to Agent and certified, without any qualifications (including any (A) “going concern” or like qualification or exception or (B) qualification or exception as to the scope of such audit, by such accountants to have been prepared in accordance with GAAP (such audited financial

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	statements to include a balance sheet, income statement, statement of cash flow, and statement of shareholder’s equity and, if prepared, such accountants’ letter to management), and (f) a Compliance Certificate attaching (i) the financial statements described in clause (c) above, (ii) supplemental Schedules in accordance with the Credit Agreement, (iii) the Excess Availability Calculation, the Leverage Ratio Calculation, the calculation of Fixed Charge Coverage Ratio and the calculation of Adjusted EBITDA, each in form and containing sufficient detail satisfactory to Agent, and (iv) a schedule of all Hedge Agreements entered into by Parent or any of its Subsidiaries with any Lender and/or any Affiliates of any Lender, which schedule shall show whether such Hedge Agreement is secured pursuant to any of the Loan Documents.
as soon as available, but in any event within 45 days after the start of each of Parent’s fiscal years,	(g) copies of Parent’s Projections, in form and containing sufficient detail (including as to scope and underlying assumptions, subject to the qualifications in Section 4.16 of the Agreement) reasonably satisfactory to Agent, in its Permitted Discretion, for the forthcoming 3 years, year by year, and for the forthcoming fiscal year, month by month, certified by the chief financial officer of Parent as being the good faith estimate of the financial performance of Parent and its consolidated Subsidiaries during the period covered thereby.
if and when filed by Parent,	(h) Form 10-Q quarterly reports, Form 10-K annual reports, and Form 8-K current reports, (i) any other material filings made by Parent with the SEC, and (j) any other material information that is provided by Parent to its shareholders generally. (It is understood and agreed that in the event Agent, after the Closing Date, notifies Parent that electronic delivery of items (h), (i) and (j) is acceptable, then such electronic delivery shall be deemed to satisfy the requirements of items (h), (i) and (j).)
Concurrently with the filing of Parent’s Form 10-Q quarterly report and Form 10-K annual report,	(k) a list of any Material Contracts entered into by a Loan Party since the most recent such filing.
promptly after being furnished or received,	(l) copies of all notices, reports, certificates and other information furnished to or received from any of the holders of the Secured Notes, or any other trustee, agent or representative of such holders (including any notices or other documents relating to any default or potential default thereunder, but in any event excluding routine notices, reports and certificates of an administrative nature), and

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	(m) a copy of the annual citizenship affidavit required to be submitted to MARAD.
At such time as, and to the extent required by, or delivered to, the trustee under the Secured Notes,	(n) copies of any possessory Collateral constituting Notes Priority Collateral, and (o) Additional Documents, substantially similar to those Additional Documents (other than with respect to the Collateral identified in clause (n) above) to the collateral agent under the Secured Notes, in favor of Agent to ensure that the ABL Collateral (as defined in the Intercreditor Agreement) and the Notes Collateral (as defined in the Intercreditor Agreement) are identical to the extent required by the Intercreditor Agreement.
Promptly after execution thereof,	(p) any settlement or plea agreement or similar arrangement providing for aggregate payments in excess of $5,000,000 per calendar year.
promptly, but in any event within 5 days after Parent or Borrower has knowledge of any event or condition that constitutes a Default or an Event of Default,	(q) notice of such event or condition and a statement of the curative action that Parent or Borrower proposes to take with respect thereto.
promptly after the commencement thereof, but in any event within 5 Business Days after the service of process with respect thereto on Parent or any of its Subsidiaries,	(r) notice of all actions, suits, or proceedings brought by or against Parent or any of its Subsidiaries before any Governmental Authority which reasonably could be expected to result in a Material Adverse Change.
on or before 5 Business Days (or such shorter period as Agent may agree) prior to the date of any Specified Event utilizing any basket amount available as a result of satisfaction of the Specified Condition,	(s) Parent shall provide Agent a certificate of a Responsible Officer, along with reasonably detailed calculations (calculated on a pro forma basis after giving effect to such Specified Event), certifying compliance with each of the conditions set forth in the definition of “Specified Condition”.

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upon the request of Agent, (t) any other information reasonably requested relating to the financial condition of Parent or its Subsidiaries.

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Schedule 5.2

Collateral Reporting

Provide Agent with each of the documents set forth below at the following times in form satisfactory to Agent:

Monthly (no later than the 5th day after the end of each calendar month), except during a Trigger Period, in which case it shall be weekly (no later than 1 Business Day following the end of each week)	(a) a Borrowing Base Certificate for the fiscal month most recently ended or calendar week, as applicable (the “Reporting Period”), (b) a detailed aging, by total, of each Loan Parties’ Accounts, together with a reconciliation and supporting documentation for any reconciling items noted (delivered electronically in an acceptable format, if Parent has implemented electronic reporting) for the Reporting Period, (c) a detailed calculation of those Accounts that are not eligible for the Borrowing Base, if Parent has not implemented electronic reporting for the Reporting Period, (d) a summary aging, by vendor, of Parent’s and its Subsidiaries’ accounts payable and any book overdraft (delivered electronically in an acceptable format, if Parent has implemented electronic reporting) and an aging, by vendor, of any held checks for the Reporting Period, and (e) a detailed report regarding Parent’s and the other Loan Parties’ cash and Cash Equivalents, including an indication of which amounts are deposited in Deposit Accounts and/or Securities Accounts subject to Control Agreements for the Reporting Period.
Monthly (no later than the 10th day after each calendar month)	(f) a detailed reconciliation to Parent’s general ledger accounts (delivered electronically in an acceptable format) for the Reporting Period, and (g) a monthly Account roll-forward, in a format acceptable to Agent, tied to the beginning and ending account receivable balances of Parent’s general ledger for the Reporting Period.
Monthly (no later than the 30th day after each calendar month),	(h) a reconciliation of Accounts, trade accounts payable, Parent’s general ledger accounts to its monthly financial statements including any book reserves related to each such category for the Reporting Period.
Quarterly (no later than the 45th day after each fiscal quarter),	(i) a report regarding Parent’s and its Subsidiaries’ accrued, but unpaid, ad valorem taxes for the most recently ended fiscal quarter.

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Upon request by Agent, (j) a detailed list of Parent’s and the other Loan Parties’ customers, with address and contact information, and   (k) such other reports as to the Collateral or the financial condition of Parent and its Subsidiaries, as Agent may reasonably request, including updates to Schedules 4.13 and 4.17.

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EX-10.7

Exhibit 10.7

EXECUTION VERSION

INTERCREDITOR AGREEMENT

This INTERCREDITOR AGREEMENT is dated as of October 5, 2011, and entered into by and among HORIZON LINES, LLC, a Delaware limited liability company (the “Company”), HORIZON LINES, INC., a Delaware corporation (the “Parent”), each of the other Grantors (as defined herein) from time to time party hereto, WELLS FARGO CAPITAL FINANCE, LLC, in its capacity as agent under the ABL Credit Agreement, including its successors and assigns from time to time (the “Initial ABL Agent”), U.S. BANK NATIONAL ASSOCIATION, as Trustee for the First-Lien Notes (defined below) (the “First-Lien Trustee”) and Collateral Agent, not in its individual capacity, but solely in its capacity as trustee and collateral agent under the First-Lien Indenture (defined below), including its successors and assigns from time to time (in such capacity as collateral agent, the “First-Lien Notes Agent”); U.S. BANK NATIONAL ASSOCIATION, as Trustee for the Second-Lien Notes (defined below) (the “Second-Lien Trustee”) and Collateral Agent, not in its individual capacity, but solely in its capacity as trustee and collateral agent under the Second-Lien Indenture (defined below), including its successors and assigns from time to time (in such capacity as collateral agent, the “Second-Lien Notes Agent”); and U.S. BANK NATIONAL ASSOCIATION, as Trustee for the Third-Lien Notes (defined below) (the “Third-Lien Trustee”) and Collateral Agent, not in its individual capacity, but solely in its capacity as trustee and collateral agent under the Third-Lien Indenture (defined below), including its successors and assigns from time to time (in such capacity as collateral agent, the “Third-Lien Notes Agent”). Capitalized terms used in this Agreement have the meanings assigned to them in Section 1.

RECITALS

The Company, the Parent, the ABL Lenders, and the Initial ABL Agent have entered into that certain Credit Agreement, dated as of the date hereof (as amended, supplemented, modified or Refinanced from time to time, the “Initial ABL Credit Agreement”);

The Company has issued, or will issue, $225 million principal amount at maturity of first-lien senior secured notes due in 2016 (the “First-Lien Notes”) under an indenture, dated as of the date hereof (as amended, supplemented, modified or Refinanced from time to time, the “First-Lien Indenture”) among the Company and the First-Lien Notes Agent;

The Company has issued, or will issue, $100 million principal amount at maturity of second-lien senior secured notes due in 2016 (the “Second-Lien Notes”) under an indenture, dated as of the date hereof (as amended, supplemented, modified or Refinanced from time to time, the “Second-Lien Indenture”) among the Company and the Second-Lien Notes Agent;

The Parent has issued, or will issue, 6.00% Series A Convertible Senior Secured Notes due 2017 (the “Series A Notes”) and the 6.00% Series B Mandatorily Convertible Senior Secured Notes (the “Series B Notes” and, together with the Series A Notes, the “Third-Lien Notes”) under an indenture, dated as of the date hereof (as amended, supplemented, modified or Refinanced from time to time, the “Third-Lien Indenture”) among the Parent and the Third-Lien Notes Agent;

The ABL Obligations are to be secured (i) on a first priority basis by Liens on the ABL Priority Collateral and (ii) on a fourth priority basis by Liens on the Notes Priority Collateral;

The First-Lien Notes Obligations are to be secured (i) on a first priority basis by Liens on the Notes Priority Collateral and (ii) on a second priority basis by Liens on the ABL Priority Collateral;

The Second-Lien Notes Obligations are to be secured (i) on a second priority basis by Liens on the Notes Priority Collateral and (ii) on a third priority basis by Liens on the ABL Priority Collateral;

The Third-Lien Notes Obligations are to be secured (i) on a third priority basis by Liens on the Notes Priority Collateral and (ii) on a fourth priority basis by Liens on the ABL Priority Collateral;

The ABL Loan Documents and the Notes Documents provide, among other things, that the parties thereto shall set forth in this Agreement their respective rights and remedies with respect to the Collateral and certain other matters; and

The ABL Agent and the Notes Agents, as required by the respective Indentures, have agreed to the intercreditor and other provisions set forth in this Agreement.

AGREEMENT

In consideration of the foregoing, the mutual covenants and obligations herein set forth and for other good and valuable consideration, the sufficiency and receipt of which are hereby acknowledged, the parties hereto, intending to be legally bound, hereby agree as follows:

I. DEFINITIONS.

1.1. Defined Terms. As used in this Agreement, the following terms shall have the following meanings:

“ABL Agent” means the Initial ABL Agent and any successor or other agent under any ABL Credit Agreement.

“ABL Claimholders” means, at any relevant time, the holders of ABL Obligations at that time, including, without limitation, the ABL Lenders and the ABL Agent under the ABL Credit Agreement and the Bank Product Providers.

“ABL Collateral” means all of the assets and property of any Grantor, whether real, personal or mixed, with respect to which a Lien is granted as security for any ABL Obligations.

“ABL Credit Agreement” means collectively, (a) the Initial ABL Credit Agreement and (b) any other credit agreement or credit agreements, one or more debt facilities, and/or commercial paper facilities, in each case, with banks or other institutional or commercial lenders providing for revolving credit loans, term loans, receivables financing (including through the sale of receivables to such lenders or to special purpose entities formed to borrow from (or sell such receivables to) such lenders against such receivables), letters of credit, bankers’ acceptances, or other borrowings, that has been incurred to increase, replace (whether upon or after termination or otherwise), Refinance in whole or in part from time to time the Obligations outstanding under the

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Initial ABL Credit Agreement or any other agreement or instrument referred to in this clause, whether or not such increase or Refinancing occurs (i) with the original parties thereto, (ii) on one or more separate occasions or (iii) simultaneously or not with the termination or repayment of the Initial ABL Credit Agreement or any other agreement or instrument referred to in this clause, in each case, unless such agreement or instrument expressly provides that it is not intended to be and is not an ABL Credit Agreement, or such agreement or instrument is not a Permitted Refinancing Agreement. Any reference to the ABL Credit Agreement hereunder shall be deemed a reference to any ABL Credit Agreement then in existence.

“ABL Default” means an “Event of Default” (as defined in the ABL Credit Agreement).

“ABL DIP Financing” has the meaning assigned to that term in Section 6.1(a).

“ABL Intercompany Loans” means intercompany loans made from time to time by the Parent or the Company or another Loan Party (as defined in the ABL Credit Agreement) to one or more of the Parent’s subsidiaries (a) for working capital purposes (as designated by the Company in good faith) and/or (b) with the proceeds of loans under the ABL Credit Agreement. The outstanding ABL Intercompany Loans, as of the date of effectiveness of this Agreement, are listed on Schedule 1 hereto.

“ABL Lenders” means the “Lenders” under and as defined in the ABL Credit Agreement or any other Person which extends credit under the ABL Credit Agreement.

“ABL Loan Documents” means, collectively (a) the “Loan Documents” (as defined in the ABL Credit Agreement) and (b) all Bank Product Agreements, as each may be amended, restated, supplemented, modified, renewed, extended or Refinanced from time to time in accordance with the provisions of this Agreement.

“ABL Mortgages” means a collective reference to each mortgage, deed of trust and other document or instrument under which any Lien on real property owned or leased by any Grantor is granted to secure any ABL Obligations or under which rights or remedies with respect to any such Liens are governed.

“ABL Obligations” means all “Obligations” (as defined in the ABL Credit Agreement), including, in each case, all amounts accruing on or after the commencement of any Insolvency or Liquidation Proceeding relating to any Grantor and all amounts that would have accrued or become due under the terms of the ABL Loan Documents but for the effect of the Insolvency or Liquidation Proceeding and irrespective of whether a claim for all or any portion of such amounts is allowable or allowed in such Insolvency or Liquidation Proceeding.

“ABL Priority Collateral” means all now owned or hereafter acquired ABL Collateral that constitutes:

(a) Accounts including, without limitation, all Accounts arising from the shipment or delivery of goods or other items generated from the operations of any Vessel, other than Accounts (“NPC Accounts”) which arise from the sale, license, assignment or other disposition of Notes Priority Collateral;

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(b) Deposit Accounts and Securities Accounts and Security Entitlements, Securities and Financial Assets credited thereto, including all cash and other funds or other property held in or on deposit therein, except in each case (i) in respect of cash and other funds to the extent constituting identifiable Proceeds of the Notes Priority Collateral and (ii) Investment Property excluded from the following clause (c);

(c) Investment Property (other than (x) Equity Interests (“NPC Equity Interests”) in Subsidiaries of the Parent or in any joint venture, partnership or other similar non-publicly owned Person owned by any Grantor, and (y) any Investment Property relating to or included in any Securities Account constituting identifiable Proceeds of NPC Accounts or any other Notes Priority Collateral or NPC Equity Interests);

(d) Money, cash and Cash Equivalents (in each case, except to the extent constituting identifiable Proceeds of the Notes Priority Collateral);

(e) tax refunds and similar tax payments;

(f) ABL Intercompany Loans;

(g) Instruments, Chattel Paper and other contracts and Documents, in each case, evidencing or substituted for, any items referred to in the preceding clauses (a) through (f);

(h) guarantees, letters of credit, Letter of Credit Rights, security and other credit enhancements and supporting obligations, in each case for items referred to in the preceding clause (a) through (f);

(i) claims and causes of action to the extent relating to any of the items referred to in the preceding clause (a) through (f);

(j) Commercial Tort Claims;

(k) General Intangibles (including contract rights), Instruments, books and Records and Supporting Obligations related to the foregoing; and

(l) Products and Proceeds (including, without limitation, insurance Proceeds) of, and books and Records evidencing or relating to, the foregoing.

“ABL Priority Collateral First Standstill Period” has the meaning assigned to that term in Section 3.1(a).

“ABL Priority Collateral Second Standstill Period” has the meaning assigned to that term in Section 3.1(a).

“ABL Priority Collateral Standstill Period” means (i) in respect of the First-Lien Notes Claimholders, the ABL Priority Collateral First Standstill Period; (ii) in respect of the

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Second-Lien Notes Claimholders, the ABL Priority Collateral Second Standstill Period; and (iii) in respect of the Third-Lien Notes Claimholders, the ABL Priority Collateral Third Standstill Period.

“ABL Priority Collateral Third Standstill Period” has the meaning assigned to that term in Section 3.1(a).

“ABL Security Documents” means any agreement, document or instrument pursuant to which a Lien is granted securing any ABL Obligations or under which rights or remedies with respect to such Liens are governed.

“Access Period” means for the Grantors’ books and Records, including, without limitation, any information relating to ABL Priority Collateral wherever located (including to the extent on Mortgaged Premises or Vessels), the period, after the commencement of an Enforcement Period by the ABL Agent, which begins on the earlier of (a) the day on which the ABL Agent provides each Notes Agent with the written notice of its election to request access pursuant to Section 3.3(b) and (b) the fifth Business Day after any Notes Agent provides the ABL Agent with notice that such Notes Agent (or its agent) has obtained possession or control of such parcel and ends on the earliest of (i) the 180th day after the date (the “Initial Access Date”) on which the ABL Agent initially obtains the ability to take physical possession of, remove, or otherwise control physical access to, or actually uses, the ABL Priority Collateral located on such Mortgaged Premises plus such number of days, if any, after the Initial Access Date that it is stayed or otherwise prohibited by law or court order from exercising remedies with respect to ABL Priority Collateral located on such Mortgaged Premises, and (ii) the termination of such Enforcement Period (the “Access Termination Date”); provided, further that the Access Termination Date may be extended upon the prior written consent of the Notes Agent representing the Higher Priority Obligations in respect of the Notes Priority Collateral.

“Account Agreements” means any lockbox account agreement, pledged account agreement, blocked account agreement, securities account control agreement, or any similar deposit or securities account agreements among any one or more of the Notes Agents and/or the ABL Agent, one or more Grantors and the relevant financial institution depository or securities intermediary.

“Additional Pari Passu Notes Agent” means the Person appointed to act as trustee, agent or representative for the holders of Additional Pari Passu Notes Obligations pursuant to any Additional Pari Passu Notes Agreement, it being understood and agreed that no Additional Pari Passu Notes Agent shall hold any Lien on Collateral, other than pursuant to a Notes Security Document; provided (i) that any such Lien shall not change or modify the Lien priorities securing any of the Notes Obligations and ABL Obligations pursuant to Section 2.1 and (ii) that the Additional Pari Passu Notes Agent’s rights are represented by the applicable Notes Agent as described in clause (c) of the definition of Additional Pari Passu Notes Obligations.

“Additional Pari Passu Notes Agreement” means the indenture, credit agreement or other agreement under which any Additional Pari Passu Notes Obligations are incurred (including, without limitation, any Permitted Refinancing Agreement in respect of any of the foregoing).

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“Additional Pari Passu Notes Obligations” means Indebtedness of the Grantors issued following the date of this Agreement to the extent (a) such Indebtedness is permitted by the terms of the ABL Credit Agreement and the applicable Indenture (pursuant to which such Indebtedness described in this definition was issued) to be secured by Liens on the Collateral ranking pari passu with the Liens securing the Notes Obligations relating to or arising out of such applicable Indenture, (b) the Grantors have granted Liens on the Collateral to secure the obligations in respect of such Indebtedness, and (c) the Additional Pari Passu Notes Agent, for the holders of such Indebtedness, has signed a joinder to this Agreement substantially in the form of Exhibit A or the applicable Notes Documents reasonably satisfactory to each Agent agreeing on behalf of itself and such holders to (i) be bound by the terms of this Agreement applicable to them, (ii) appoint the applicable Notes Agent to act as their representative hereunder and (iii) agree to be bound by the pari passu intercreditor provisions contained in the Notes Security Documents entered into in connection with the applicable Indenture (pursuant to which such Indebtedness described in this definition was issued) as in effect on the date hereof (which provisions are binding on the applicable Notes Claimholders only).

“Affiliate” means, with respect to a specified Person, another Person that directly, or indirectly through one or more intermediaries, controls or is controlled by or is under common control with the Person specified. For purposes of this definition, a Person shall be deemed to “control” or be “controlled by” a Person if such Person possesses, directly or indirectly, power to direct or cause the direction of the management or policies of such Person whether through ownership of equity interests, by contract or otherwise.

“Agents” means the ABL Agent, the First-Lien Notes Agent, the Second-Lien Notes Agent and the Third-Lien Notes Agent.

“Agreement” means this Intercreditor Agreement, as amended, restated, renewed, extended, supplemented or otherwise modified from time to time.

“Bank Product Agreements” means those agreements entered into from time to time by a Grantor with a Bank Product Provider in connection with the obtaining of any of the Bank Products.

“Bank Product Debt” means Indebtedness and other Obligations relating to or arising from Bank Products, including Bank Product Obligations (as defined in the ABL Credit Agreement).

“Bank Product Provider” shall mean any ABL Lender or Affiliate of an ABL Lender that provides any Bank Products to any Grantor; provided, however, that if, at any time, an ABL Lender ceases to be an ABL Lender under the ABL Credit Agreement, then, from and after the date on which it ceases to be an ABL Lender thereunder, neither it nor any of its Affiliates shall constitute Bank Product Providers and the obligations with respect to Bank Products provided by such former ABL Lender or any of its Affiliates shall no longer constitute Bank Product Debt.

“Bank Products” means any one or more of the following financial products or accommodations extended to the Parent, the Company or any of their respective Subsidiaries by

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a Bank Product Provider: (a) credit cards, (b) credit card processing services, (c) debit cards, (d) stored value cards, (e) purchase cards (including so-called “procurement cards” or “P-cards”), (f) Cash Management Services, or (g) transactions under Hedge Agreements.

“Bankruptcy Code” means Title 11 of the United States Code entitled “Bankruptcy,” as now and hereafter in effect, or any successor statute.

“Bankruptcy Law” means the Bankruptcy Code and any similar federal, state or foreign law for the relief of debtors.

“Business Day” means a day other than a Saturday, Sunday or other day on which commercial banks in New York City or in the city in the United States of the corporate trust office of the First-Lien Trustee (currently located in New York City), are authorized or required by law to close.

“Capital Stock” means (a) in the case of a corporation, capital stock, (b) in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of capital stock, (c) in the case of a partnership, partnership interests (whether general or limited), (d) in the case of a limited liability company, membership interests and (e) any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets of, the issuing Person and all rights, warrants or options exchangeable for or convertible into any of the items described in clauses (a) through (e) above; provided that with respect to the foregoing, Capital Stock shall exclude any debt securities convertible into Capital Stock, whether or not such debt securities include any right of vote or participation with Capital Stock.

“Cash Management Services” means any cash management or related services including treasury, depository, return items, overdraft, controlled disbursement, merchant store value cards, e-payables services, electronic funds transfer, interstate depository network, automatic clearing house transfer (including the Automated Clearing House processing of electronic funds transfers through the direct Federal Reserve Fedline system) and other cash management arrangements.

“Claimholder” means any First-Lien Notes Claimholder, Second-Lien Notes Claimholder, Third-Lien Notes Claimholder or ABL Claimholder, as applicable.

“Class” means a category of holders of Obligations comprised of one of the following: ABL Obligations; First-Lien Notes Obligations; Second-Lien Notes Obligations; Third-Lien Notes Obligations.

“Collateral” means any and all of the assets and property of any Grantor, whether real, personal or mixed, which constitute ABL Collateral or Notes Collateral.

“Company” has the meaning assigned to that term in the Preamble to this Agreement.

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“Discharge(d)” shall have the correlative meaning in respect of, as the context requires, Discharge of ABL Obligations, Discharge of First-Lien Notes Obligations, Discharge of Second-Lien Notes Obligations or Discharge of Third-Lien Notes Obligations.

“Discharge of ABL Obligations” means, except to the extent otherwise expressly provided in Section 5.5:

(a) payment in full in cash of all ABL Obligations (other than contingent obligations or contingent indemnification obligations except as provided in clause (e) below);

(b) termination or expiration of all commitments, if any, to extend credit under the ABL Loan Documents;

(c) termination, cash collateralization (in an amount and manner reasonably satisfactory to the ABL Agent, but in no event greater than 105% of the aggregate undrawn face amount, plus commissions, fees, and expenses) or backstop of all letters of credit issued under the ABL Credit Agreement in compliance with the terms of the ABL Credit Agreement;

(d) cash collateralization of the ABL Obligations constituting Bank Product Debt (in an amount and manner reasonably satisfactory to the ABL Agent, such amount to be determined by the ABL Agent as sufficient to satisfy the reasonably estimated credit exposure in respect thereof); and

(e) cash collateralization (or support by a letter of credit) for any costs, expenses and contingent indemnification obligations consisting of ABL Obligations not yet due and payable but with respect to which a claim has been threatened or asserted under any ABL Loan Documents (in an amount and manner reasonably satisfactory to the ABL Agent).

“Discharge of All Notes Obligations” means, collectively, the Discharge of First-Lien Notes Obligations, the Discharge of Second-Lien Notes Obligations and the Discharge of Third-Lien Notes Obligations.

“Discharge of First-Lien Notes Obligations” means, except to the extent otherwise expressly provided in Section 5.5:

(a) payment in full in cash of all First-Lien Notes Obligations (other than contingent obligations or indemnification obligations, in each case for which no claim has been threatened or asserted); and

(b) cash collateralization (or support by a letter of credit) for any costs, expenses and contingent indemnification obligations consisting of First-Lien Notes Obligations not yet due and payable but with respect to which a claim has been threatened or asserted under any First-Lien Notes Documents (in an amount and manner reasonably satisfactory to the First-Lien Notes Agent).

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“Discharge of Second-Lien Notes Obligations” means, except to the extent otherwise expressly provided in Section 5.5:

(a) payment in full in cash of all Second-Lien Notes Obligations (other than contingent obligations or indemnification obligations, in each case for which no claim has been threatened or asserted); and

(b) cash collateralization (or support by a letter of credit) for any costs, expenses and contingent indemnification obligations consisting of Second-Lien Notes Obligations not yet due and payable but with respect to which a claim has been threatened or asserted under any Second-Lien Notes Documents (in an amount and manner reasonably satisfactory to the Second-Lien Notes Agent).

“Discharge of Third-Lien Notes Obligations” means, except to the extent otherwise expressly provided in Section 5.5:

(a) payment in full in cash of all Third-Lien Notes Obligations (other than contingent obligations or indemnification obligations, in each case for which no claim has been threatened or asserted); and

(b) cash collateralization (or support by a letter of credit) for any costs, expenses and contingent indemnification obligations consisting of Third-Lien Notes Obligations not yet due and payable but with respect to which a claim has been threatened or asserted under any Third-Lien Notes Documents (in an amount and manner reasonably satisfactory to the Third-Lien Notes Agent).

“Disposition” means any sale, lease, exchange, transfer or other disposition of any Collateral.

“Enforcement” means, collectively or individually for any one or more of the Agents, when an ABL Default or Notes Default, as applicable, has occurred and is continuing, to enforce or attempt to enforce any right or power to repossess, replevy, attach, garnish, levy upon, collect the Proceeds of, foreclose or realize in any manner whatsoever its Lien upon, sell, liquidate or otherwise dispose of, or otherwise restrict or interfere with the use of, or exercise any remedies with respect to, any material amount of Collateral, whether by judicial enforcement of any of the rights and remedies under the ABL Loan Documents, the applicable Notes Documents and/or under any applicable law, by self-help repossession, by non-judicial foreclosure sale, lease, or other disposition, by set-off, by notification to account obligors of any Grantor, by any sale, lease, or other disposition implemented by any Grantor following an ABL Default or a Notes Default, as applicable, in connection with which the ABL Agent or the applicable Notes Agent, as applicable, has agreed to release its Liens on the subject property, or otherwise, but in all cases excluding (i) the establishment of borrowing base reserves, collateral ineligibles, or other conditions for advances, (ii) the changing of advance rates or advance sublimits, (iii) the imposition of a default rate or late fee, (iv) the collection and application of Accounts or other monies deposited from time to time in Deposit Accounts or Securities Accounts, in each case, to the extent constituting ABL Priority Collateral, against the ABL Obligations pursuant to the provisions of the ABL Loan Documents (including, without limitation, the notification of account debtors, depositary

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institutions or any other Person to deliver proceeds of Collateral to the ABL Agent), (v) the cessation of lending pursuant to the provisions of the ABL Loan Documents, including upon the occurrence of a default on the existence of an overadvance, (vi) the filing of a proof of claim in any Insolvency or Liquidation Proceeding, (vii) the consent by the ABL Agent to disposition by any Grantor of any of the ABL Priority Collateral, (viii) the acceleration of the Notes Obligations or the ABL Obligations, (ix) the application of monies deposited from time to time in Deposit Accounts or Securities Accounts, in each case identified in clause (e) of the definition of Notes Priority Collateral, only to the extent constituting proceeds from disposition by any Grantor of Notes Priority Collateral to be applied against the applicable Notes Obligations pursuant to the provisions of the Notes Documents as a mandatory prepayment or repurchase of Notes only so long as any action or application undertaken under this clause (ix) may occur in connection with an offer to repurchase the Notes pursuant to the applicable asset sale covenant of the applicable Indenture; and (x) the consent by the applicable Notes Agent to disposition by any Grantor of any of the Notes Priority Collateral as long as such disposition is conducted in the ordinary course of business and not in anticipation of or in connection with an event of default, acceleration or any other Enforcement event under or in respect of any of the Notes Documents.

“Enforcement Notice” means a written notice delivered, at a time when an ABL Default or Notes Default has occurred and is continuing, by any of the ABL Agent or a Notes Agent to the other Agents announcing that an Enforcement Period has commenced, specifying the relevant event of default, stating that the payment of the principal amount of all Notes Obligations of such Notes Agent and its related Notes Claimholders or ABL Obligations, as applicable, have been accelerated and including the current balance of the ABL Obligations or such Notes Obligations, as applicable, and requesting the current balance of the ABL Obligations or such Notes Obligations, as applicable, owing to the noticed party.

“Enforcement Period” means the period of time following the receipt by any Agent of an Enforcement Notice from any other Agent until the earliest of (a) in the case of an Enforcement Period commenced by the First-Lien Notes Agent, the Discharge of First-Lien Notes Obligations, (b) in the case of an Enforcement Period commenced by the Second-Lien Notes Agent, the Discharge of the Second-Lien Notes Obligations, (c) in the case of an Enforcement Period commenced by the Third-Lien Notes Agent, the Discharge of the Third-Lien Notes Obligations, (d) in the case of an Enforcement Period commenced by the ABL Agent, the Discharge of ABL Obligations, (e) the date on which the ABL Agent or the relevant Notes Agent (as applicable) agrees in writing to terminate the Enforcement Period commenced by it, or (f) the date on which the ABL Default or the applicable Notes Default that was the subject of the Enforcement Notice relating to such Enforcement Period has been cured to the satisfaction of the ABL Agent or the relevant Notes Agent, as applicable, or waived in writing.

“First-Lien Indenture” has the meaning assigned to that term in the Recitals to this Agreement.

“First-Lien Notes” has the meaning assigned to that term in the Recitals to this Agreement.

“First-Lien Notes Agent” has the meaning assigned to that term in the Preamble to this Agreement.

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“First-Lien Notes Claimholders” means, at any relevant time, the holders of First-Lien Notes Obligations at that time, including the Noteholders of First-Lien Notes, each Additional Pari Passu Notes Agent appointed under or in respect of the First-Lien Notes Documents, the First-Lien Trustee and the First-Lien Notes Agent.

“First-Lien Notes Documents” means the First-Lien Indenture, the First-Lien Notes, each Additional Pari Passu Notes Agreement relating to the First-Lien Indenture, the Notes Security Documents securing or relating to the First-Lien Notes Obligations and each of the other agreements, documents and instruments executed pursuant thereto, and any other document or instrument executed or delivered at any time in connection with any First-Lien Notes Obligations, including any intercreditor or joinder agreement among holders of First-Lien Notes Obligations to the extent such are effective at the relevant time (including, without limitation, any Permitted Refinancing Agreement in respect of any of the foregoing), as each may be amended, restated, supplemented, modified, renewed, extended or Refinanced from time to time in accordance with the provisions of this Agreement.

“First-Lien Notes Obligations” means all Obligations owing, due, or secured under any of the First-Lien Notes and any of the other First-Lien Notes Documents, and all Additional Pari Passu Notes Obligations related thereto, whether now existing or arising hereafter, including all principal, premium, interest, fees, attorneys fees, costs, charges, expenses, reimbursement obligations, indemnities, guarantees, and all other amounts payable under or secured by any First-Lien Notes Document or Additional Pari Passu Notes Agreement related thereto (including, in each case, all amounts accruing on or after the commencement of any Insolvency or Liquidation Proceeding and all amounts that would have accrued or become due but for the effect of the Insolvency or Liquidation Proceeding and irrespective of whether a claim for all or any portion of such amounts is allowable or allowed in such Insolvency or Liquidation Proceeding).

“First-Lien Trustee” has the meaning assigned to that term in the Preamble to this Agreement.

“Governmental Authority” means any federal, state, municipal, national or other government, governmental department, commission, board, bureau, court, agency or instrumentality or political subdivision thereof or any entity or officer exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to any government or any court, in each case whether associated with a state of the United States, the United States, or a foreign entity or government.

“Grantors” means the Company, the Parent, each Subsidiary of the Parent and each other Person that has or may from time to time hereafter execute and deliver an ABL Security Document or a Notes Security Document as a grantor of a security interest (or the equivalent thereof).

“Hedge Agreement” means any rate swap agreement, forward rate agreement, commodity swap, commodity option, interest rate option, forward foreign exchange agreement, spot foreign exchange agreement, rate cap agreement, rate floor agreement, rate collar agreement, currency swap agreement, cross-currency rate swap agreement, currency option and any other similar agreement entered into for the purposes of hedging risks of currency, interest,

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or commodity price fluctuations or similar matters, or any indemnity agreements and arrangements entered into in connection therewith, in each case, as the same may be amended, restated, supplemented, or otherwise modified from time to time.

“Higher Priority Agent” means, at any relevant time, each Agent whose related Obligations are Higher Priority Obligations in relation to any other Obligations not yet Discharged consistent with the definition of Discharge of ABL Obligations, Discharge of First-Lien Notes Obligations, Discharge of Second-Lien Notes Obligations or Discharge of Third-Lien Notes Obligations, as applicable.

“Higher Priority Claimholders” means, at any relevant time, the Claimholders whose related Obligations are Higher Priority Obligations in relation to any other Obligations not yet Discharged.

“Higher Priority Liens” means, at any relevant time, the Liens in favor of an Agent which are intended as established under Section 2.1 or 6.1 hereof to be higher in priority in relation to those Liens in favor of an Agent or Claimholder of lower ranking priority and if the order of priority is relevant in the context of any of Sections 3.1, 3.2, 4.2, 5.1, 5.2 or 5.4 or elsewhere herein, then in order of descending priority from the highest to the lowest ranking priority among Classes.

“Higher Priority Obligations” means, at any relevant time, Obligations held by an Agent (for itself or for the benefit of its related Claimholder) or Claimholder the liens in favor of which are Higher Priority Liens.

“Indebtedness” means and includes all Obligations that constitute “Debt,” “Indebtedness,” “Obligations,” “Liabilities” or any similar term within the ABL Credit Agreement or any Indenture, as applicable.

“Indenture(s)” means individually or collectively as the context requires, the First-Lien Indenture, the Second-Lien Indenture and the Third-Lien Indenture.

“Initial ABL Agent” has the meaning assigned to that term in the Preamble.

“Initial ABL Credit Agreement” has the meaning assigned to that term in the Recitals.

“Initial Access Date” has the meaning assigned to that term in the definition of the term “Access Period.”

“Initial Notes” means, individually or collectively as the context requires, the First-Lien Notes, the Second-Lien Notes and the Third-Lien Notes.

“Insolvency or Liquidation Proceeding” means:

(a) any voluntary or involuntary case or proceeding under the Bankruptcy Code or other applicable bankruptcy or insolvency laws of another jurisdiction with respect to any Grantor;

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(b) any other voluntary or involuntary insolvency, reorganization or bankruptcy case or proceeding, or any receivership, liquidation, reorganization or other similar case or proceeding with respect to any Grantor or with respect to a material portion of their respective assets;

(c) any composition of liabilities or similar arrangement relating to any Grantor, whether or not under a court’s jurisdiction or supervision;

(d) any liquidation, dissolution, reorganization or winding up of any Grantor, whether voluntary or involuntary, whether or not under a court’s jurisdiction or supervision, and whether or not involving insolvency or bankruptcy; or

(e) any general assignment for the benefit of creditors or any other marshalling of assets and liabilities of any Grantor.

“Intellectual Property” means, all of the following in any jurisdiction throughout the world: (a) patents, patent applications and inventions, including all renewals, extensions, combinations, divisions, or reissues thereof; (b) trademarks, service marks, trade names, trade dress, logos, internet domain names and other business identifiers, together with the goodwill symbolized by any of the foregoing, and all applications, registrations, renewals and extensions thereof; (c) copyrights and all works of authorship including all registrations, applications, renewals, extensions and reversions thereof; (d) all computer software, source code, executable code, data, databases and documentation thereof; (e) all trade secret rights in information, including trade secret rights in any formula, pattern, compilation, program, device, method, technique, or process, that (i) derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use, and (ii) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy; (f) all other intellectual property or proprietary rights in any discoveries, concepts, ideas, research and development, know-how, formulae, patterns, inventions, compilations, compositions, manufacturing and production processes and techniques, program, device, method, technique, technical data, procedures, designs, recordings, graphs, drawings, reports, analyses, specifications, databases, and other proprietary or confidential information, including customer lists, supplier lists, pricing and cost information, business and marketing plans and proposals and advertising and promotional materials; and (g) all rights to sue at law or in equity for any infringement or other impairment or violation thereof and all products and proceeds of the foregoing.

“Lien” means any mortgage, pledge, hypothec, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), charge or other security interest or any other security agreement (including, without limitation, any conditional sale or other title retention agreement and any Capital Lease or similar term within the ABL Credit Agreement or any Indenture, having substantially the same economic effect as any of the foregoing).

“Mortgaged Premises” means any real property which shall now or hereafter be subject to a Notes Mortgage and/or an ABL Mortgage.

“New Agent” has the meaning assigned to that term in Section 5.5.

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“New Debt Notice” has the meaning assigned to that term in Section 5.5.

“Noteholders” means the “Holders” (or any similar term) as defined in the applicable Indenture and any holders of Additional Pari Passu Notes Obligations in respect of such Indenture.

“Notes” means (a) the Initial Notes and any other senior secured notes issued under any Indenture and (b) any other credit agreement, loan agreement, note agreement, promissory note, indenture or other agreement or instrument evidencing or governing the terms of any indebtedness or other financial accommodation that has been incurred to increase or Refinance in whole or in part the Obligations outstanding under the Initial Notes, any other notes referred to in clause (a) or any other agreement or instrument referred to in this clause (b), unless such agreement or instrument expressly provides that it is not intended to be and is not a Note, or such agreement or instrument is not a Permitted Refinancing Agreement. Any reference to the Notes hereunder shall be deemed a reference to any Notes then in existence.

“Notes Agent(s)” means, individually or collectively as the context requires, the First-Lien Notes Agent, the Second-Lien Notes Agent and the Third-Lien Notes Agent.

“Notes Claimholders” means, at any relevant time, the holders of Notes Obligations at that time, including the Noteholders, each Additional Pari Passu Notes Agent, each Trustee and each Notes Agent.

“Notes Collateral” means any and all of the assets and property of any Grantor, whether real, personal or mixed, with respect to which a Lien is granted as security for any Notes Obligations.

“Notes Default” means an “Event of Default” as defined in the applicable Indenture or in any applicable Additional Pari Passu Note Agreement.

“Notes DIP Financing” has the meaning assigned to that term in Section 6.1(b).

“Notes Documents” means each of the Indentures, each of the Notes, each Additional Pari Passu Notes Agreement, the Notes Security Documents securing or executed or delivered in connection with any or all of the Notes and each of the other agreements, documents and instruments executed pursuant thereto, and any other document or instrument executed or delivered at any time in connection with any Notes Obligations, including any intercreditor or joinder agreement among holders of Notes Obligations to the extent such are effective at the relevant time (including, without limitation, any Permitted Refinancing Agreement in respect of any of the foregoing), as each may be amended, restated, supplemented, modified, renewed, extended or Refinanced from time to time in accordance with the provisions of this Agreement.

“Notes Intercompany Loans” means intercompany loans made from time to time by the Company or a Guarantor (as defined in any Indenture) to one or more of the Parent’s subsidiaries other than ABL Intercompany Loans. The outstanding Notes Intercompany Loans, as of the date hereof, are listed on Schedule 2 hereto.

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“Notes Mortgages” means a collective reference to each mortgage, deed of trust and any other document or instrument under which any Lien on real property owned or leased by any Grantor is granted to secure any Notes Obligations or under which rights or remedies with respect to any such Liens are governed.

“Notes Obligations” means all Obligations owing, due, or secured under any of the Notes and any of the other Notes Documents, and all Additional Pari Passu Notes Obligations, whether now existing or arising hereafter, including all principal, premium, interest, fees, attorneys fees, costs, charges, expenses, reimbursement obligations, indemnities, guarantees, and all other amounts payable under or secured by any Notes Document or Additional Pari Passu Notes Agreement (including, in each case, all amounts accruing on or after the commencement of any Insolvency or Liquidation Proceeding and all amounts that would have accrued or become due but for the effect of the Insolvency or Liquidation Proceeding and irrespective of whether a claim for all or any portion of such amounts is allowable or allowed in such Insolvency or Liquidation Proceeding).

“Notes Priority Collateral” means all now owned or hereafter acquired Notes Collateral that constitutes:

(a) Goods, Equipment (including Vessels) and Inventory and all Documents relating to any Goods, Equipment or Inventory;

(b) Intellectual Property;

(c) Real Estate Assets;

(d) (i) the Capital Stock of each Subsidiary of the Parent, and (ii) Capital Stock owned by any Grantor in any joint venture, partnership or similar non-publicly owned Person that is not a Subsidiary of the Parent;

(e) Deposit Accounts and Securities Accounts existing solely for the purpose of holding identifiable Proceeds of the Notes Priority Collateral including without limitation (to the extent containing solely such identifiable Proceeds of the Notes Priority Collateral) any Deposit Account or Securities Account designated under the applicable Indenture as the “Collateral Proceeds Account”;

(f) General Intangibles (excluding Hedge Agreements and any rights thereunder) including, without limitation, (i) any charters, operating leases and similar agreements entered into with respect to a Vessel and any security or guarantee in respect of the charterer’s or lessee’s obligations under such charter, lease or similar agreement and (ii) any building conversion or repair contracts relating to a Vessel and any security or guarantee in respect of the builder’s obligations thereunder (in each case, except to the extent constituting ABL Priority Collateral);

(g) claims and causes of action (except to the extent constituting ABL Priority Collateral);

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(h) Identifiable products and Proceeds of, and books and Records evidencing or relating to, the foregoing (including, without limitation, insurance proceeds); and

(i) all other Collateral other than ABL Priority Collateral.

Notwithstanding anything to the contrary in this Intercreditor Agreement, for the avoidance of doubt, all Accounts arising from the shipment or delivery of goods or other items generated from the operation of any Vessel (including, without limitation, any such Accounts generated through an entity acquired with proceeds of Notes Priority Collateral) shall constitute ABL Priority Collateral.

“Notes Priority Collateral First Standstill Period” has the meaning assigned to that term in Section 3.2(a).

“Notes Priority Collateral Second Standstill Period” has the meaning assigned to that term in Section 3.2(a).

“Notes Priority Collateral Standstill Period” means (i) in respect of the Second-Lien Notes Claimholders, the Notes Priority Collateral First Standstill Period; (ii) in respect of the Third-Lien Notes Claimholders, the Notes Priority Collateral Second Standstill Period; and (iii) in respect of the ABL Claimholders, the Notes Priority Collateral Third Standstill Period.

“Notes Priority Collateral Third Standstill Period” has the meaning assigned to that term in Section 3.2(a).

“Notes Security Documents” means any agreement, document or instrument pursuant to which a Lien is granted securing any Notes Obligations or under which rights or remedies with respect to such Liens are governed.

“Obligations” means all present and future loans, advances, liabilities, obligations, covenants, duties, and debts from time to time owing by any Grantor to any agent or trustee (including either Agent), the ABL Claimholders, the Notes Claimholders or any of them or their respective Affiliates, arising from or in connection with the ABL Loan Documents, the Notes Documents or Bank Products, whether for principal, interest or payments for early termination, whether or not evidenced by any note, or other instrument or document, whether arising from an extension of credit, opening of a letter of credit, acceptance, loan, guaranty, indemnification or otherwise, whether direct or indirect, absolute or contingent, due or to become due, primary or secondary, as principal or guarantor, and including all principal, interest, charges, expenses, fees, attorneys’ fees, filing fees and any other sums chargeable to the Grantors, including, without limitation, the “Obligations”, as defined in the ABL Credit Agreement, and the “Obligations”, as defined in any Indenture, under any of the Notes and any Additional Pari Passu Notes Agreement (including, in each case, all amounts accruing on or after the commencement of any Insolvency or Liquidation Proceeding and all amounts that would have accrued or become due but for the effect of the Insolvency or Liquidation Proceeding and irrespective of whether a claim for all or any portion of such amounts is allowable or allowed in such Insolvency or Liquidation Proceeding).

“Parent” has the meaning assigned to that term in the Recitals to this Agreement.

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“Parent Subsidiary” means any U.S. subsidiary of the Parent that becomes a party hereto.

“Permitted Higher Priority Claimholders” has the respective meanings assigned to that term separately in Section 3.1(a)(ii) and in Section 3.2(a)(ii).

“Permitted Refinancing” means any Refinancing the governing documentation of which constitutes Permitted Refinancing Agreements.

“Permitted Refinancing Agreements” means, with respect to either the ABL Credit Agreement, any of the Notes Documents or any Additional Pari Passu Notes Agreement, as applicable, any credit agreement, loan agreement, note agreement, promissory note, indenture or other agreement or instrument evidencing or governing the terms of any indebtedness or other financial accommodation that has been incurred to Refinance (whether upon or after termination or otherwise), in whole or in part the Obligations outstanding under the ABL Credit Agreement, any of the Notes or any Additional Pari Passu Notes Agreement, whether or not such Refinancing occurs (i) with the original parties thereto, (ii) on one or more separate occasions or (iii) simultaneously or not with the termination or repayment of the ABL Credit Agreement, any of the Notes Documents or any Additional Pari Passu Notes Agreement or any other agreement or instrument referred to in this clause, unless such agreement or instrument expressly provides that it is not intended to be and is not a Permitted Refinancing Agreement, as such financing documentation may be Refinanced from time to time and that would not be prohibited by Section 5.3(d) or Section 5.3(e), as applicable.

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

“Plan of Reorganization” means any plan of reorganization, plan of liquidation, agreement for composition, or other type of plan of arrangement proposed in or in connection with any Insolvency or Liquidation Proceeding.

“Pledged Collateral” has the meaning set forth in Section 5.4(a).

“Real Estate Asset” means, at any time of determination, any interest (fee, leasehold or otherwise) then owned by the Company or any Grantor in any real property.

“Records” means all present and future “records” (as defined in Article 9 of the UCC).

“Recovery” has the meaning set forth in Section 6.4.

“Refinance” means, in respect of any Indebtedness, to restate, refinance, extend, renew, defease, amend, modify, supplement, restructure, replace, refund or repay, or to issue other indebtedness (including, without limitation, debt securities) in exchange or replacement for, such Indebtedness, in any case in whole or in part and such term shall include, without limitation, increasing the amount borrowable thereunder, altering the maturity date thereof and adding subsidiaries as borrowers or guarantors thereunder, in each case, whether or not such refinancing,

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extension, renewal, defeasance, amendment, modification, supplementing, restructuring, replacement, exchange, refunding or repayment occurs (i) with the original parties to the documents governing such Indebtedness, (ii) on one or more separate occasions or (iii) simultaneously or not with the termination of the documents governing such Indebtedness or the repayment of such Indebtedness. “Refinanced” and “Refinancing” shall have correlative meanings.

“Second-Lien Indenture” has the meaning assigned to that term in the Recitals to this Agreement.

“Second-Lien Notes” has the meaning assigned to that term in the Recitals to this Agreement.

“Second-Lien Notes Agent” has the meaning assigned to that term in the Preamble to this Agreement.

“Second-Lien Notes Claimholders” means, at any relevant time, the holders of Second-Lien Notes Obligations at that time, including the Noteholders of Second-Lien Notes, each Additional Pari Passu Notes Agent appointed under or in respect of the Second-Lien Notes Documents, the Second-Lien Trustee and the Second-Lien Notes Agent.

“Second-Lien Notes Documents” means the Second-Lien Indenture, the Second-Lien Notes, each Additional Pari Passu Notes Agreement relating to the Second-Lien Indenture, the Notes Security Documents securing or relating to the Second-Lien Notes Obligations and each of the other agreements, documents and instruments executed pursuant thereto, and any other document or instrument executed or delivered at any time in connection with any Second-Lien Notes Obligations, including any intercreditor or joinder agreement among holders of Second-Lien Notes Obligations to the extent such are effective at the relevant time (including, without limitation, any Permitted Refinancing Agreement in respect of any of the foregoing), as each may be amended, restated, supplemented, modified, renewed, extended or Refinanced from time to time in accordance with the provisions of this Agreement.

“Second-Lien Notes Obligations” means all Obligations owing, due, or secured under any of the Second-Lien Notes and any of the other Second-Lien Notes Documents, and all Additional Pari Passu Notes Obligations related thereto, whether now existing or arising hereafter, including all principal, premium, interest, fees, attorneys fees, costs, charges, expenses, reimbursement obligations, indemnities, guarantees, and all other amounts payable under or secured by any Second-Lien Notes Document or Additional Pari Passu Notes Agreement related thereto (including, in each case, all amounts accruing on or after the commencement of any Insolvency or Liquidation Proceeding and all amounts that would have accrued or become due but for the effect of the Insolvency or Liquidation Proceeding and irrespective of whether a claim for all or any portion of such amounts is allowable or allowed in such Insolvency or Liquidation Proceeding).

“Second-Lien Trustee” has the meaning assigned to that term in the Preamble to this Agreement.

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“Secured Parties” means the ABL Claimholders and the Notes Claimholders.

“Series A Notes” has the meaning assigned to that term in the Recitals to this Agreement.

“Series B Notes” has the meaning assigned to that term in the Recitals to this Agreement.

“Subsidiary” means, with respect to any Person, any corporation, partnership, limited liability company, association, joint venture or other business entity of which more than 50% of the total voting power of shares of stock or other ownership interests entitled (without regard to the occurrence of any contingency) to vote in the election of the Person or Persons (whether directors, managers, trustees or other Persons performing similar functions) having the power to direct or cause the direction of the management and policies thereof is at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person or a combination thereof.

“Third-Lien Indenture” has the meaning assigned to that term in the Recitals to this Agreement.

“Third-Lien Notes” has the meaning assigned to that term in the Recitals to this Agreement.

“Third-Lien Notes Agent” has the meaning assigned to that term in the Preamble to this Agreement.

“Third-Lien Notes Claimholders” means, at any relevant time, the holders of Third-Lien Notes Obligations at that time, including the Noteholders of Third-Lien Notes, each Additional Pari Passu Notes Agent appointed under or in respect of the Third-Lien Notes Documents, the Third-Lien Trustee and the Third-Lien Notes Agent.

“Third-Lien Notes Documents” means the Third-Lien Indenture, the Third-Lien Notes, each Additional Pari Passu Notes Agreement relating to the Third-Lien Indenture, the Notes Security Documents securing or relating to the Third-Lien Notes Obligations and each of the other agreements, documents and instruments executed pursuant thereto, and any other document or instrument executed or delivered at any time in connection with any Third-Lien Notes Obligations, including any intercreditor or joinder agreement among holders of Third-Lien Notes Obligations to the extent such are effective at the relevant time (including, without limitation, any Permitted Refinancing Agreement in respect of any of the foregoing), as each may be amended, restated, supplemented, modified, renewed, extended or Refinanced from time to time in accordance with the provisions of this Agreement.

“Third-Lien Notes Obligations” means all Obligations owing, due, or secured under any of the Third-Lien Notes and any of the other Third-Lien Notes Documents, and all Additional Pari Passu Notes Obligations related thereto, whether now existing or arising hereafter, including all principal, premium, interest, fees, attorneys fees, costs, charges, expenses, reimbursement obligations, indemnities, guarantees, and all other amounts payable under or secured by any Third-Lien

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Notes Document or Additional Pari Passu Notes Agreement related thereto (including, in each case, all amounts accruing on or after the commencement of any Insolvency or Liquidation Proceeding and all amounts that would have accrued or become due but for the effect of the Insolvency or Liquidation Proceeding and irrespective of whether a claim for all or any portion of such amounts is allowable or allowed in such Insolvency or Liquidation Proceeding).

“Third-Lien Trustee” has the meaning assigned to that term in the Preamble to this Agreement.

“Trustee” means individually or collectively as the context requires, the First-Lien Trustee, the Second-Lien Trustee and the Third-Lien Trustee.

“UCC” means the Uniform Commercial Code (or any similar equivalent legislation) as in effect from time to time in the State of New York; provided, however, that, at any time, if by reason of mandatory provisions of law, any or all of the perfection or priority of the Agents’ security interest in any item or portion of the Collateral is governed by the Uniform Commercial Code as in effect in a jurisdiction other that the State of New York, the term “UCC” shall mean the Uniform Commercial Code as in effect, at such time, in such other jurisdiction for purposes of the provisions hereof relating to such perfection or priority and for purposes of definitions relating to such provisions.

“Vessel” means any watercraft or other artificial contrivance used, or capable of being used, as a means of transportation on water which is owned by and registered in the name of any of the Grantors or leased by any of the Grantors pursuant to a lease on a demise or bareboat charter basis or pursuant to an operating agreement constituting a capital lease obligation, including all spares, equipment, and any additional improvements associated with such watercraft or contrivance.

1.2. UCC Terms. The following terms shall have the meanings assigned to them in Article 8 or 9 of the UCC (provided that if a term is defined in Article 8 of the UCC and Article 9 of the UCC, such term shall have the meaning assigned to it in Article 9 of the UCC): “Accounts”, “Chattel Paper”, “Commercial Tort Claims”, “Deposit Accounts”, “Documents”, “Equipment”, “Financial Assets”, “General Intangibles”, “Goods”, “Instruments”, “Inventory”, “Investment Property”, “Letter of Credit Rights”, “Money”, “Proceeds”, “Security”, “Securities Accounts”, “Securities Entitlements” and “Supporting Obligations”.

1.3. Terms Generally. The definitions of terms in this Agreement 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:

(a) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, restated, supplemented, modified, renewed or extended;

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(b) any reference herein to any Person shall be construed to include such Person’s permitted successors and assigns;

(c) the words “herein,” “hereof” and “hereunder,” and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof;

(d) all references herein to Sections or Articles shall be construed to refer to Sections or Articles of this Agreement;

(e) all uncapitalized terms have the meanings, if any, given to them in the UCC, as now or hereafter enacted in the State of New York (unless otherwise specifically defined herein);

(f) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights;

(g) any reference herein to a Person in a particular capacity or capacities excludes such Person in any other capacity or individually;

(h) any reference herein to any law shall be construed to refer to such law as amended, modified, codified, replaced, or re-enacted, in whole or in part, and in effect on the pertinent date; and

(i) in the compilation of periods of time hereunder from a specified date to a later specified date, the word “from” means “from and including” and the words “to” and “until” each means “to, but not through.”

II. LIEN PRIORITIES.

2.1. Relative Priorities. Irrespective of the date, time, method, manner or order of grant, attachment or perfection of any Liens securing any of the Notes Obligations granted on the Collateral or of any Liens securing the ABL Obligations granted on the Collateral (including, in each case, irrespective of whether any such Lien is granted (or secures Obligations relating to the period) before or after the commencement of any Insolvency or Liquidation Proceeding) and notwithstanding any provision of any UCC, or any other applicable law, or the ABL Loan Documents or any of the Notes Documents or any defect or deficiencies in, or failure to attach or perfect, the Liens securing the ABL Obligations or any of the Notes Obligations or any other circumstance whatsoever, the ABL Agent, on behalf of the ABL Claimholders, the First-Lien Notes Agent on behalf of the First-Lien Notes Claimholders, the Second-Lien Notes Agent on behalf of the Second-Lien Notes Claimholders, and the Third-Lien Notes Agent on behalf of the Third-Lien Notes Claimholders, hereby agree that:

(a) any Lien of the ABL Agent on the ABL Priority Collateral securing the ABL Obligations, whether such Lien is now or hereafter held by or on behalf of the ABL Agent or any other ABL Claimholder or any other agent or trustee therefor, regardless of how or when

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acquired, whether by grant, possession, statute, operation of law, subrogation or otherwise, shall be senior in all respects and prior to any Lien on the ABL Priority Collateral securing any Notes Obligations; and the Liens of the ABL Claimholders, the Liens of the First-Lien Notes Claimholders, the Liens of the Second-Lien Notes Claimholders and the Liens of the Third-Lien Notes Claimholders shall rank as set forth below with respect to the ABL Priority Collateral:

	Priority on ABL Priority Collateral
ABL Claimholders	First
First-Lien Notes Claimholders	Second
Second-Lien Notes Claimholders	Third
Third-Lien Notes Claimholders	Fourth

(b) any Lien of the First-Lien Notes Agent on the Notes Priority Collateral securing the First-Lien Notes Obligations, whether such Lien is now or hereafter held by or on behalf of the First-Lien Notes Agent, any other Notes Claimholder or any other agent or trustee therefor, regardless of how or when acquired, whether by grant, possession, statute, operation of law, subrogation or otherwise, shall be senior in all respects to all Liens on the Notes Priority Collateral securing Second-Lien Notes Obligations, Third-Lien Notes Obligations and any ABL Obligations; and the Liens of the First-Lien Notes Claimholders, the Liens of the Second-Lien Notes Claimholders, the Liens of Third-Lien Notes Claimholders and the Liens of the ABL Claimholders shall rank as set forth below with respect to the Notes Priority Collateral:

	Priority on Notes Priority Collateral
First-Lien Notes Claimholders	First
Second-Lien Notes Claimholders	Second
Third-Lien Notes Claimholders	Third
ABL Claimholders	Fourth

(c) In the event the United States of America (or its successors or assigns) enforces the judgment lien issued in favor of the United States of America by the United States District Court for the District of Puerto Rico, Serial Number USAO-2011A44, recorded on June 7, 2011, Book Number 26527, Page 256, Instrument Number 201163850 (the “U.S. Judgment Lien”) by seeking satisfaction of the U.S. Judgment Lien from any property of the Grantors (the amount of the U.S. Judgment Lien to be satisfied at the time of any enforcement action being referred to as the “Judgment Amount”), each Agent, on its own behalf and on behalf of its respective Claimholders, hereby agrees that the Judgment Amount shall be applied 25% to the ABL Priority Collateral and 75% to the Notes Priority Collateral. Where the enforcement of the U.S. Judgment Lien has not been applied to the ABL Priority Collateral and Notes Priority Collateral as set forth in this Section 2.1, so long as neither the Discharge of ABL Obligations nor the Discharge of All Notes Obligations has occurred, whether or not any Insolvency or Liquidation Proceeding has been commenced by or against any Grantor, any Collateral (including assets or Proceeds subject to Liens referred to in the final sentence of Section 2.3) received by any Agent or any Notes Claimholders or ABL Claimholders, whether or not such receipt was in the ordinary course or in connection with the exercise of any right, power, or remedy (including set-off) or Enforcement

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relating to the Collateral shall be segregated and held in trust and forthwith paid over to the appropriate Agent for the benefit of the appropriate Notes Claimholders or the ABL Claimholders, as applicable, in the same form as received, with any necessary endorsements or as a court of competent jurisdiction may otherwise direct. The foregoing terms of this Section 2.1 shall apply to and bind each successive Higher Priority Agent in relation to the ABL Priority Collateral or Notes Priority Collateral respectively (as if such Agent were named in the preceding sentences of this Section 2.1) as applicable until Discharge of all Higher Priority Obligations in relation to the applicable ABL Priority Collateral or Notes Priority Collateral respectively so as to effectuate compliance and consistency with the applicable order of Liens priority set forth in this Agreement. Each Agent is hereby authorized by the other Agents to make any such endorsements as agent for the other appropriate Agent or any appropriate Notes Claimholders or ABL Claimholders, as applicable. This authorization is coupled with an interest and is irrevocable until the Discharge of ABL Obligations and Discharge of All Notes Obligations.

2.2. Prohibition on Contesting Liens. Each of the respective Notes Agents, on behalf of each of their respective Notes Claimholders, and the ABL Agent, on behalf of each ABL Claimholder, consents to the granting of Liens in favor of each of the others to secure the ABL Obligations and the Notes Obligations, as applicable, and agrees that no Claimholder will be entitled to, and it will not (and shall be deemed to have irrevocably, absolutely, and unconditionally waived any right to), contest (directly or indirectly) or support (directly or indirectly) any other Person in contesting, in any proceeding (including any Insolvency or Liquidation Proceeding): (a) the attachment, perfection, priority, validity or enforceability of any Lien in the Collateral held by or on behalf of any of the ABL Claimholders to secure the payment of the ABL Obligations or any of the Notes Claimholders to secure the payment of any of the Notes Obligations, (b) the priority, validity or enforceability of the ABL Obligations or the Notes Obligations, including the allowability or priority of the Notes Obligations or the ABL Obligations, as applicable, in any Insolvency or Liquidation Proceeding, or (c) the validity or enforceability of the provisions of this Agreement; provided that nothing in this Agreement shall be construed to prevent or impair the rights of the ABL Agent, on behalf of the ABL Claimholders, or any of the Notes Agents, on behalf of their respective Notes Claimholders, to enforce this Agreement, including the provisions of this Agreement relating to the priority of the Liens securing the Obligations as provided in Sections 2.1, 3.1, 3.2 and 6.1.

2.3. No New Liens. So long as one or more of the Discharge of the ABL Obligations, the Discharge of the First-Lien Notes Obligations, the Discharge of the Second-Lien Notes Obligations and the Discharge of the Third-Lien Notes Obligations has occurred, whether or not any Insolvency or Liquidation Proceeding has been commenced by or against one or more of the Company or any other Grantor, the parties hereto agree, subject to Article VI, that the Company shall not, and shall not permit any other Grantor to:

(a) grant or permit any additional Liens on any asset or property to secure any Notes Obligations unless it has granted or concurrently grants a Lien on such asset or property to secure the ABL Obligations and each of the other Notes Obligations; or

(b) grant or permit any additional Liens on any asset or property to secure any ABL Obligations unless it has granted or concurrently grants a Lien on such asset or property to secure all of the Notes Obligations.

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To the extent any additional Liens are granted on any asset or property pursuant to this Section 2.3, the priority of such additional Liens shall be determined in accordance with Section 2.1. In addition, to the extent that the foregoing provisions are not complied with for any reason, without limiting any other rights and remedies available hereunder, the ABL Agent, on behalf of the ABL Claimholders, and each of the Notes Agent, on behalf of their respective Notes Claimholders, agree that any amounts received by or distributed to any of them pursuant to or as a result of Liens granted in contravention of this Section 2.3 shall be subject to Section 4.2.

2.4. Similar Liens and Agreements. The parties hereto agree that it is their intention that the ABL Collateral and the Notes Collateral be identical except (a) as provided in Article VI and (b) as otherwise provided in this Agreement. In furtherance of the foregoing and of Section 8.8, the parties hereto agree, subject to the other provisions of this Agreement, upon request by the ABL Agent or any of the Notes Agents, to cooperate in good faith (and to direct their counsel to cooperate in good faith) from time to time in order to determine the specific items included in the ABL Collateral and the Notes Collateral and the steps taken to perfect their respective Liens thereon and the identity of the respective parties obligated under the ABL Loan Documents and the respective Notes Documents.

III. EXERCISE OF REMEDIES; ENFORCEMENT.

3.1. Restrictions on the Notes Agents and the Other Notes Claimholders.

(a) Until the Discharge of ABL Obligations has occurred, whether or not any Insolvency or Liquidation Proceeding has been commenced by or against any Grantor, the Notes Agents and the other Notes Claimholders:

(i) will not exercise or seek to exercise (but instead shall be deemed to have hereby irrevocably, absolutely and unconditionally waived for the duration of the respective ABL Priority Collateral Standstill Period applicable to each Notes Agent (which also binds the other respective Notes Claimholders) as provided below in this Section 3.1(a)(i)), any rights, powers, or remedies with respect to any ABL Priority Collateral (including (A) any right of set-off or any right under any Account Agreement, landlord waiver or bailee’s letter or similar agreement or arrangement to which any Notes Agent or any Notes Claimholder is a party, (B) any right to undertake self-help re-possession or non-judicial disposition of any ABL Priority Collateral (including any partial or complete strict foreclosure), and/or (C) any right to institute, prosecute, or otherwise maintain any action or proceeding with respect to such rights, powers or remedies (including any action of foreclosure)); provided, however, that:

(1) the First-Lien Notes Agent may exercise any or all of such rights, powers, or remedies after a period of at least 180 days has elapsed since the later of: (i) the date on which the First-Lien Notes Agent declared the existence of a Notes Default in respect of the First-Lien Notes Obligations, accelerated (to the extent such amount was not already due and owing) the payment of the principal amount of all First-Lien Notes Obligations, and demanded payment thereof and (ii) the date on which the ABL Agent received the Enforcement Notice from the First-Lien Notes Agent; provided further, however, that neither the First-Lien Notes Agent nor any other First-Lien Notes Claimholder shall exercise any rights or remedies with respect to the

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ABL Priority Collateral if, notwithstanding the expiration of such 180 day period, the ABL Agent or the other ABL Claimholders (A) shall have commenced, whether before or after the expiration of such 180 day period, and be diligently pursuing the exercise of their rights, powers, or remedies with respect to all or any material portion of such Collateral (prompt written notice of such exercise to be given to each of the other Agents), or (B) shall have been stayed by operation of law or any court order from pursuing any such exercise of remedies (the period during which the First-Lien Notes Agent and the other First-Lien Notes Claimholders may not pursuant to this Section 3.1(a)(i)(1) exercise any rights, powers, or remedies with respect to the ABL Priority Collateral, the “ABL Priority Collateral First Standstill Period”);

(2) the Second-Lien Notes Agent may exercise any or all of such rights, powers, or remedies after a period of at least 360 days has elapsed since the later of: (i) the date on which the Second-Lien Notes Agent declared the existence of a Notes Default in respect of the Second-Lien Notes Obligations, accelerated (to the extent such amount was not already due and owing) the payment of the principal amount of all Second-Lien Notes Obligations, and demanded payment thereof and (ii) the latest to occur of the date on which the ABL Agent and the First-Lien Notes Agent received the Enforcement Notice from the Second-Lien Notes Agent; provided further, however, that neither the Second-Lien Notes Agent nor any other Second-Lien Notes Claimholder shall exercise any rights or remedies with respect to the ABL Priority Collateral if, notwithstanding the expiration of such 360 day period, the ABL Agent, the other ABL Claimholders, the First-Lien Notes Agent or the First-Lien Notes Claimholders (A) shall have commenced, whether before or after the expiration of such 360 day period, and be diligently pursuing the exercise of their rights, powers, or remedies with respect to all or any material portion of such Collateral (prompt written notice of such exercise to be given to each of the other Agents, or (B) shall have been stayed by operation of law or any court order from pursuing any such exercise of remedies (the period during which the Second-Lien Notes Agent and the other Second-Lien Notes Claimholders may not pursuant to this Section 3.1(a)(i)(2) exercise any rights, powers, or remedies with respect to the ABL Priority Collateral, the “ABL Priority Collateral Second Standstill Period”);

(3) the Third-Lien Notes Agent may exercise any or all of such rights, powers, or remedies after a period of at least 540 days has elapsed since the later of: (i) the date on which the Third-Lien Notes Agent declared the existence of a Notes Default in respect of the Third-Lien Notes Obligations, accelerated (to the extent such amount was not already due and owing) the payment of the principal amount of all Third-Lien Notes Obligations, and demanded payment thereof and (ii) the latest to occur of the date on which the ABL Agent, the First-Lien Notes Agent and the Second-Lien Notes Agent received the Enforcement Notice from the Third-Lien Notes Agent; provided further, however, that neither the Third-Lien Notes Agent nor any other Third-Lien Notes Claimholder shall exercise any rights or remedies with respect to the ABL Priority Collateral if, notwithstanding the expiration of such 540 day period, any of the ABL Agent, the other ABL Claimholders, the First-Lien Notes Agent, the other First-Lien Notes Claimholders, the Second-Lien Notes Agent or the other Second-Lien Notes Claimholders (A) shall have commenced, whether before or after the expiration of such 540 day period, and be diligently pursuing the exercise of their rights, powers, or remedies with respect to all or any material portion of such Collateral (prompt written notice of such exercise to be given to each of the other Agents), or (B) shall have been stayed by operation of law or any court order from

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pursuing any such exercise of remedies (the period during which the Third-Lien Notes Agent and the other Third-Lien Notes Claimholders may not pursuant to this Section 3.1(a)(i)(3) exercise any rights, powers, or remedies with respect to the ABL Priority Collateral, the “ABL Priority Collateral Third Standstill Period”);

(ii) will not, directly or indirectly, contest, protest or object to or hinder any judicial or non-judicial foreclosure proceeding or action (including any partial or complete strict foreclosure) brought by the ABL Agent or any other ABL Claimholder or any other Higher Priority Claimholders in respect of the ABL Priority Collateral then permitted to so exercise rights, powers and remedies in accordance with the terms of this Agreement (for purposes only of this Section 3.1(a), a “Permitted Higher Priority Claimholder”) relating to the ABL Priority Collateral or any other exercise by the ABL Agent or any other ABL Claimholder (or any other Permitted Higher Priority Claimholders) of any other rights, powers and remedies relating to the ABL Priority Collateral, including any sale, lease, exchange, transfer, or other disposition of the ABL Priority Collateral, whether under the ABL Loan Documents, applicable Notes Documents in respect of Higher Priority Obligations, applicable law, or otherwise, or the exercise of the right of the ABL Agent to set-off or credit bid the ABL Obligations;

(iii) subject to their rights under clause (a)(i) above (and under clause (vi) of Section 3.1(c)), will not object to the forbearance by the ABL Agent or the ABL Claimholders (or any other Permitted Higher Priority Claimholders) from bringing or pursuing any Enforcement with respect to the ABL Priority Collateral;

(iv) except as may be permitted in Section 3.1(c), irrevocably, absolutely, and unconditionally waive any and all rights each respective Notes Agent or the respective Notes Claimholders may have as a junior lien creditor or otherwise to object (and seek or be awarded any relief of any nature whatsoever based on any such objection) to the manner in which the ABL Agent or the ABL Claimholders (or other Permitted Higher Priority Claimholders) (A) enforce or collect (or attempt to collect) the ABL Obligations or other Notes Obligations or (B) realize or seek to realize upon or otherwise enforce the Liens in and to the ABL Priority Collateral securing the ABL Obligations or other Notes Obligations, regardless of whether any action or failure to act by or on behalf of the ABL Agent or ABL Claimholders (or other Permitted Higher Priority Claimholders) is adverse to the interest of any Notes Agent or any of the other Notes Claimholders. Without limiting the generality of the foregoing, the Notes Claimholders shall be deemed to have hereby irrevocably, absolutely, and unconditionally waived any right to object (and seek or be awarded any relief of any nature whatsoever based on any such objection), at any time prior or subsequent to any disposition of any of the ABL Priority Collateral, on the ground(s) that any such disposition of ABL Priority Collateral (x) would not be or was not “commercially reasonable” within the meaning of any applicable UCC and/or (y) would not or did not comply with any other requirement under any applicable UCC or under any other applicable law governing the manner in which a secured creditor (including one with a Lien on real property) is to realize on its collateral; and

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(v) subject to Section 3.1(a) and (c), acknowledge and agree that no covenant, agreement or restriction contained in any of the Notes Security Documents or any other Notes Document (other than this Agreement) shall be deemed to restrict in any way the rights and remedies of the ABL Agent or the ABL Claimholders (or other Permitted Higher Priority Claimholders) with respect to the ABL Priority Collateral as set forth in this Agreement and the ABL Loan Documents(or Notes Documents in respect of Permitted Higher Priority Claimholders);

provided, however, that, in the case of (i), (ii) and (iii) above, the Liens granted to secure the respective Notes Obligations of the respective Notes Claimholders shall attach to any Proceeds resulting from actions taken by the ABL Agent or any ABL Claimholder (or other Permitted Higher Priority Claimholders) with respect to the ABL Priority Collateral in accordance with this Agreement after application of such Proceeds (in accordance with the relative priorities set forth in Section 2.1) to the extent necessary to meet the requirements of a Discharge of ABL Obligations and, if applicable, a Discharge of First-Lien Notes Obligations and a Discharge of Second-Lien Notes Obligations.

(b) (i) Until the Discharge of ABL Obligations has occurred, whether or not any Insolvency or Liquidation Proceeding has been commenced by or against any Grantor, the ABL Agent and the other ABL Claimholders shall have the right to enforce rights, exercise remedies (including set-off and the right to credit bid their debt) and, in connection therewith (including voluntary Dispositions of ABL Priority Collateral by the respective Grantors after an ABL Default) make determinations regarding the release, disposition, or restrictions with respect to the ABL Priority Collateral without any consultation with or the consent of any Notes Agents or any Notes Claimholder; provided, however, that the Liens securing the Notes Obligations shall remain on the Proceeds (other than those properly applied to the ABL Obligations in accordance with Section 4.1) of such Collateral released or disposed of subject to the relative priorities described in Section 2.1. In exercising rights, powers, and remedies with respect to the ABL Priority Collateral, the ABL Agent and the ABL Claimholders may enforce the provisions of the ABL Loan Documents and exercise rights, powers, and/or remedies thereunder and/or under applicable law or otherwise, all in such order and in such manner as they may determine in the exercise of their sole discretion. Such exercise and enforcement shall include the rights of an agent appointed by them to sell or otherwise dispose of the ABL Priority Collateral upon foreclosure, to incur expenses in connection with such sale or disposition, and to exercise all the rights and remedies of a secured creditor under the UCC, of a secured creditor under the Bankruptcy Laws of any applicable jurisdiction or any other applicable law.

(ii) After the Discharge of ABL Obligations has occurred, thereafter until the Discharge of First-Lien Notes Obligations has occurred, whether or not any Insolvency or Liquidation Proceeding has been commenced by or against any Grantor, the First-Lien Notes Agent and the other First-Lien Notes Claimholders shall have the right to enforce rights, exercise remedies (including set-off and the right to credit bid their debt) and, in connection therewith (including voluntary Dispositions of ABL Priority Collateral by the respective Grantors after a Notes Default in respect of the First-Lien Notes Obligations) make determinations regarding the release, disposition, or restrictions with respect to the ABL Priority Collateral without any consultation with or the consent of any other Notes Agents or any other Notes Claimholder; provided, however, that the Liens securing the Second-Lien Notes Obligations and the Third-Lien

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Notes Obligations shall remain on the Proceeds (other than those properly applied to the First-Lien Notes Obligations in accordance with Section 4.1) of such Collateral released or disposed of subject to the relative priorities described in Section 2.1. In exercising rights, powers, and remedies under this subsection (ii) with respect to the ABL Priority Collateral, the First-Lien Notes Agent and the other First-Lien Notes Claimholders may enforce the provisions of the First-Lien Notes Documents and exercise rights, powers, and/or remedies thereunder and/or under applicable law or otherwise, all in such order and in such manner as provided in the First-Lien Notes Documents. Such exercise and enforcement shall include the rights of an agent appointed by them to sell or otherwise dispose of the ABL Priority Collateral upon foreclosure, to incur expenses in connection with such sale or disposition, and to exercise all the rights and remedies of a secured creditor under the UCC, of a secured creditor under the Bankruptcy Laws of any applicable jurisdiction or any other applicable law.

(iii) After the Discharge of ABL Obligations has occurred, and after the Discharge of the First-Lien Notes Obligations has occurred, thereafter until the Discharge of Second-Lien Notes Obligations has occurred, whether or not any Insolvency or Liquidation Proceeding has been commenced by or against any Grantor, the Second Lien Notes Agent and the other Second-Lien Notes Claimholders shall have the right to enforce rights, exercise remedies (including set-off and the right to credit bid their debt) and, in connection therewith (including voluntary Dispositions of ABL Priority Collateral by the respective Grantors after a Notes Default in respect of the Second-Lien Notes Obligations) make determinations regarding the release, disposition, or restrictions with respect to the ABL Priority Collateral without any consultation with or the consent of any Third-Lien Notes Agent or any Third-Lien Notes Claimholder; provided, however, that the Liens securing the Third-Lien Notes Obligations shall remain on the Proceeds (other than those properly applied to the Second-Lien Notes Obligations in accordance with Section 4.1) of such Collateral released or disposed of subject to the relative priorities described in Section 2.1. In exercising rights, powers, and remedies under this subsection (iii) with respect to the ABL Priority Collateral, the Second-Lien Notes Agent and the Second-Lien Notes Claimholders may enforce the provisions of the Second-Lien Notes Documents and exercise rights, powers, and/or remedies thereunder and/or under applicable law or otherwise, all in such order and in such manner as provided in the Second-Lien Notes Documents. Such exercise and enforcement shall include the rights of an agent appointed by them to sell or otherwise dispose of the ABL Priority Collateral upon foreclosure, to incur expenses in connection with such sale or disposition, and to exercise all the rights and remedies of a secured creditor under the UCC, of a secured creditor under the Bankruptcy Laws of any applicable jurisdiction or any other applicable law.

(c) Notwithstanding anything to the contrary contained herein, any Notes Agent and any Notes Claimholder may:

(i) file a claim or statement of interest with respect to the applicable respective Notes Obligations; provided that an Insolvency or Liquidation Proceeding has been commenced by or against any Grantor;

(ii) take any action (not adverse to the priority status of the Liens of any Higher Priority Agent on the ABL Priority Collateral, or the rights of the ABL Agent or any of the other ABL Claimholders (or any other Higher Priority Claimholders in respect of the ABL Priority Collateral) to exercise rights, powers, and/or remedies in respect thereof, including those under Article VI) in order to create, perfect, preserve or protect (but not enforce) its Lien on any of the ABL Priority Collateral;

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(iii) file any necessary responsive or defensive pleadings in opposition to any motion, claim, adversary proceeding or other pleading made by any person objecting to or otherwise seeking the disallowance of the claims of such respective Notes Claimholders, including any claims secured by the ABL Priority Collateral, if any, in each case in accordance with the terms of this Agreement;

(iv) file any pleadings, objections, motions or agreements which assert rights or interests available to unsecured creditors of the Grantors arising under either any Insolvency or Liquidation Proceeding or applicable non-bankruptcy law, in each case not inconsistent with the terms of this Agreement or applicable law (including the Bankruptcy Laws of any applicable jurisdiction) and any pleadings, objections, motions or agreements which assert rights or interests available to secured creditors solely with respect to the Notes Priority Collateral of such respective Notes Agent or Notes Claimholder, provided, however, any Notes Agent and any Notes Claimholder may not file any pleadings, objections, motions or agreements which assert that the ABL Obligations should not be Discharged and otherwise indefeasibly paid in full in cash;

(v) vote on any Plan of Reorganization, file any proof of claim, make other filings and make any arguments, objections, and motions (including in support of or opposition to, as applicable, the confirmation or approval of any Plan of Reorganization) that are, in each case, in accordance with the terms of this Agreement; provided, however, any Notes Agent and any Notes Claimholder may not vote on any Plan of Reorganization, make other filings or make any arguments, objections, and motions (including in support of or opposition to, as applicable, the confirmation or approval of any Plan of Reorganization) that does not Discharge the ABL Obligations or otherwise indefeasibly pay in full in cash the ABL Obligations;

(vi) exercise any of its rights, powers and/or remedies with respect to any of the ABL Priority Collateral after the termination of the respective ABL Priority Collateral Standstill Period applicable to such respective Notes Agent and Notes Claimholders to the extent permitted by Section 3.1(a)(i); and

(vii) take any action permitted to be taken by any Notes Agent or Notes Claimholders described in clauses (iii), (vi), (viii), (ix) and (x) of the definition of “Enforcement”.

Each Notes Agent, on behalf of the respective Notes Claimholders for which it acts as agent, and each Notes Claimholder agrees that it will not take or receive any ABL Priority Collateral (including Proceeds) in connection with the exercise of any right or remedy (including set-off) with respect to ABL Priority Collateral in its capacity as a creditor in violation of this Agreement. Without limiting the generality of the foregoing, unless and until the Discharge of ABL Obligations has occurred, except as expressly provided in Sections 3.1(a)(i), 6.7 and Section 3.1(c), the sole right of the respective Notes Agents and the Notes Claimholders with respect to the ABL Priority Collateral is to hold its respective Lien on such Collateral pursuant to the applicable Notes Security Documents for the period and to the extent granted therein and to receive a share of the Proceeds thereof, if any, in accordance with Section 4.1.

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(d) Except as otherwise specifically set forth in Sections 3.1(a), 3.4 and Article VI, any of the Notes Agents and the Notes Claimholders with respect to the ABL Priority Collateral, may exercise rights and remedies as unsecured creditors against any Grantor and subject to Section 3.2, may exercise rights and remedies with respect to its respective Notes Priority Collateral, in each case, in accordance with the terms of its respective Notes Documents and applicable law; provided, however, that in the event that any Notes Agent or any Notes Claimholder becomes a judgment Lien creditor in respect of ABL Priority Collateral as a result of its enforcement of its rights as an unsecured creditor with respect to its respective Notes Obligations, such judgment Lien shall be subject to the terms of this Agreement for all purposes (including in relation to the ABL Obligations) as the other Liens securing its respective Notes Obligations are subject to this Agreement.

(e) Except as provided in Section 5.3(e), nothing in this Agreement shall prohibit the receipt by any Notes Agent or any other Notes Claimholders of the required payments of interest, principal and other amounts owed in respect of their respective Notes Obligations so long as such receipt is not the direct or indirect result of the exercise by any Notes Agent or any Notes Claimholders of rights or remedies as a secured creditor (including set-off) with respect to ABL Priority Collateral or enforcement in contravention of this Agreement of any Lien held by any of them. Nothing in this Agreement impairs or otherwise adversely affects any rights or remedies the ABL Agent or the ABL Claimholders may have against the Grantors under the ABL Loan Documents.

3.2. Restrictions on the ABL Agent and ABL Claimholders, Second-Lien Notes Agents and Second-Lien Notes Claimholders, and Third-Lien Notes Agents and Third-Lien Notes Claimholders.

(a) Until the Discharge of All Notes Obligations has occurred, whether or not any Insolvency or Liquidation Proceeding has been commenced by or against any Grantor, the ABL Agent, the other ABL Claimholders, the Second-Lien Notes Agent, the other Second-Lien Notes Claimholders, the Third-Lien Notes Agent and other Third-Lien Notes Claimholders:

(i) will not exercise or seek to exercise (but instead shall be deemed to have hereby irrevocably, absolutely and unconditionally waived for the duration of the respective Notes Priority Collateral Standstill Period applicable to such Notes Agent or ABL Agent (which also binds the other respective Second-Lien Notes Claimholders, Third-Lien Notes Claimholders and ABL Claimholders) as provided below in this Section 3.2(a)(i)) any rights, powers, or remedies with respect to any Notes Priority Collateral (including (A) any right of set-off or any right under any Account Agreement, landlord waiver or bailee’s letter or similar agreement or arrangement to which any Notes Agent or any other Notes Claimholder is a party, (B) any right to undertake self-help re-possession or nonjudicial disposition of any Notes Priority Collateral (including any partial or complete strict foreclosure), and/or (C) any right to institute, prosecute or otherwise maintain any action or proceeding with respect to such rights, powers, or remedies (including any action of foreclosure)); provided, however, that:

(1) the Second-Lien Notes Agent may exercise any or all of such rights, powers, or remedies after a period of at least 180 days has elapsed since the later of: (i) the date on which the Second-Lien Notes Agent declared the existence of a Notes Default in respect of the Second-Lien Obligations, accelerated (to the extent such amount was not already due and owing) the payment of the principal amount of all Second-Lien Notes Obligations, and demanded payment thereof and (ii) the date on which the First-Lien Notes Agent received the Enforcement Notice from the Second-Lien Notes Agent relating to such action; provided, further, however, that neither the Second-Lien Notes Agent nor the other Second-Lien Notes Claimholders shall exercise any rights or remedies with respect to the Notes Priority Collateral if, notwithstanding the expiration of such 180 day period, the First-Lien Notes Agent or the other First-Lien Notes Claimholders (A) shall have commenced, whether before or after the expiration of such 180 day period, and be diligently pursuing the exercise of their rights, powers or remedies with respect to all or any material portion of such Collateral (prompt written notice of such exercise to be given to each of the other Agents) or (B) shall have been stayed by operation of law or by any court order from pursuing any such exercise of remedies (the period during which each of the other Agents and the other Second-Lien Notes Claimholders may not pursuant to this Section 3.2(a)(i)(1) exercise any rights or remedies with respect to the Notes Priority Collateral, the “Notes Priority Collateral First Standstill Period”);

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(2) the Third-Lien Notes Agent may exercise any or all of such rights, powers, or remedies after a period of at least 360 days has elapsed since the later of: (i) the date on which the Third-Lien Notes Agent declared the existence of a Notes Default in respect of the Third-Lien Obligations, accelerated (to the extent such amount was not already due and owing) the payment of the principal amount of all Third-Lien Notes Obligations, and demanded payment thereof and (ii) the latest to occur of the date on which the First-Lien Notes Agent and the Second-Lien Notes Agent received the Enforcement Notice from the Third-Lien Notes Agent relating to such action; provided, further, however, that neither the Third-Lien Notes Agent nor the other Third-Lien Notes Claimholders shall exercise any rights or remedies with respect to the Notes Priority Collateral if, notwithstanding the expiration of such 360 day period, the First-Lien Notes Agent or the other First-Lien Notes Claimholders or the Second-Lien Notes Agent or the other Second-Lien Notes Claimholders (A) shall have commenced, whether before or after the expiration of such 360 day period, and be diligently pursuing the exercise of their rights, powers or remedies with respect to all or any material portion of such Collateral (prompt written notice of such exercise to be given to each of the other Agents) or (B) shall have been stayed by operation of law or by any court order from pursuing any such exercise of remedies (the period during which each of the other Agents and the other Third-Lien Notes Claimholders may not pursuant to this Section 3.2(a)(i)(2) exercise any rights or remedies with respect to the Notes Priority Collateral, the “Notes Priority Collateral Second Standstill Period”);

(3) the ABL Agent may exercise any or all of such rights, powers, or remedies after a period of at least 540 days has elapsed since the later of: (i) the date on which the ABL Agent declared the existence of an ABL Default in respect of the ABL Obligations, accelerated (to the extent such amount was not already due and owing) the payment of the principal amount of all ABL Obligations, and demanded payment thereof and (ii) the latest to occur of the date on which the First-Lien Notes Agent, the Second-Lien Notes Agent and the Third-Lien Notes Agent received the Enforcement Notice from the ABL Agent relating to such action; provided, further,

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however, that neither the ABL Agent nor the other ABL Claimholders shall exercise any rights or remedies with respect to the Notes Priority Collateral if, notwithstanding the expiration of such 540 day period, the First-Lien Notes Agent or the other First-Lien Notes Claimholders, the Second-Lien Notes Agent or other Second-Lien Notes Claimholders or the Third-Lien Notes Agent or other Third-Lien Notes Claimholders (A) shall have commenced, whether before or after the expiration of such 540 day period, and be diligently pursuing the exercise of their rights, powers or remedies with respect to all or any material portion of such Collateral (prompt written notice of such exercise to be given to each of the other Agents) or (B) shall have been stayed by operation of law or by any court order from pursuing any such exercise of remedies (the period during which each of the other Agents and the other ABL Claimholders may not pursuant to this Section 3.2(a)(i)(3) exercise any rights or remedies with respect to the Notes Priority Collateral, the “Notes Priority Collateral Third Standstill Period”); provided, finally, however, that the ABL Agent, independent in all respects of the preceding provisos, may exercise the rights provided for in Section 3.3;

(ii) will not, directly or indirectly, contest, protest or object to or hinder any judicial or non-judicial foreclosure proceeding or action (including any partial or complete strict foreclosure) brought by the First-Lien Notes Agent or any other First-Lien Notes Claimholder (or any other Higher Priority Claimholder in respect of the Notes Priority Collateral then permitted to so exercise rights, powers and remedies in accordance with the terms of this Agreement) (for purposes only of this Section 3.2(a), a “Permitted Higher Priority Claimholder”) relating to the Notes Priority Collateral or any other exercise by the First-Lien Notes Agent or any other First-Lien Notes Claimholder (or other Permitted Higher Priority Claimholder in respect of the Notes Priority Collateral) of any rights, powers and remedies relating to the Notes Priority Collateral, including any sale, lease, exchange, transfer, or other disposition of the Notes Priority Collateral, whether under the applicable Notes Documents, the ABL Loan Documents, applicable law, or otherwise, or the exercise of the right of the Notes Agent to set-off or credit bid the Notes Obligations, subject to the Notes Agents’ and the other Notes Claimholders’ obligations under Section 3.3;

(iii) subject to their rights under clause (a)(i) above (and under clause (vi) of Section 3.2(c), will not object to the forbearance by the First-Lien Notes Agent or the First-Lien Notes Claimholders (or any other Permitted Higher Priority Claimholder in respect of the Notes Priority Collateral) from bringing or pursuing any Enforcement with respect to the Notes Priority Collateral;

(iv) except as may be permitted in Section 3.2(c) and subject to Sections 3.3 and 3.4, irrevocably, absolutely and unconditionally waive any and all rights the Second-Lien Notes Agent, the Second-Lien Notes Claimholders, the Third-Lien Notes Agent, the Third-Lien Notes Claimholders, the ABL Agent and ABL Claimholders may have as a junior lien creditor or otherwise to object (and seek or be awarded any relief of any nature whatsoever based on any such objection) to the manner in which any Notes Agent or any Notes Claimholders (or other Permitted Higher Priority Claimholder) (A) enforce or collect (or attempt to collect) any Notes Obligations or (B) realize or seek to realize upon or otherwise enforce the Liens in and to the Notes Priority Collateral securing any Notes Obligations, regardless of whether any action or failure to act by or on behalf of

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any Notes Agent or Notes Claimholders is adverse to the interest of any other Notes Obligations Claimholders or the ABL Claimholders. Without limiting the generality of the foregoing, the Notes Obligations Claimholders and the ABL Claimholders shall be deemed to have hereby irrevocably, absolutely and unconditionally waived any right to object (and seek or be awarded any relief of any nature whatsoever based on any such objection), at any time prior to or subsequent to any disposition of any Notes Priority Collateral, on the ground(s) that any such disposition of Notes Priority Collateral (a) would not be or was not “commercially reasonable” within the meaning of any applicable UCC and/or (b) would not or did not comply with any other requirement under any applicable UCC or under any other applicable law governing the manner in which a secured creditor (including one with a Lien on real property) is to realize on its collateral; and

(v) subject to Sections 3.2(a) and (c) and Sections 3.3 and 3.4, acknowledge and agree that no covenant, agreement or restriction contained in any Notes Security Documents, other Notes Documents, the ABL Security Documents or any other ABL Loan Document (other than this Agreement) shall be deemed to restrict in any way the rights and remedies of the First-Lien Notes Agent or the First-Lien Notes Claimholders (or any other Permitted Higher Priority Claimholder in respect of the Notes Priority Collateral) with respect to the Notes Priority Collateral as set forth in this Agreement and the First-Lien Notes Documents (or the Notes Documents in respect of Permitted Higher Priority Claimholders);

provided, however, that in the case of (i), (ii) and (iii) above, the Liens granted to secure Notes Obligations of the Second-Lien Notes Claimholders, the Notes Obligations of the Third-Lien Notes Claimholders and the ABL Obligations of the ABL Claimholders shall attach to any Proceeds resulting from actions taken by the First-Lien Notes Agent or any First-Lien Notes Claimholder (or any other Permitted Higher Priority Claimholder in respect of the Notes Priority Collateral) with respect to the Notes Priority Collateral in accordance with this Agreement after application of such Proceeds (in accordance with the relative priorities set forth in Section 2.1) to the extent necessary to meet the requirements of a Discharge of First-Lien Notes Obligations and, if applicable, a Discharge of Second-Lien Notes Obligations and of Third-Lien Notes Obligations.

(b) (i) Until the Discharge of First-Lien Notes Obligations has occurred, whether or not any Insolvency or Liquidation Proceeding has been commenced by or against any Grantor, the First-Lien Notes Agent and the First-Lien Notes Claimholders shall have the right to enforce rights, exercise remedies (including set-off and the right to credit bid their debt) and make, in connection therewith (including voluntary Dispositions of Notes Priority Collateral by the respective Grantors after a Notes Default in respect of the First-Lien Notes Obligations) determinations regarding the release, disposition, or restrictions with respect to the Notes Priority Collateral without any consultation with or the consent of any other Notes Agent or Note Claimholder or the ABL Agent or any ABL Claimholder subject to the Notes Agents’ and the Notes Claimholders’ obligations under Section 3.3; provided, however, that the Lien securing the Second-Lien Notes Obligations, the Third-Lien Notes Obligations and the ABL Obligations shall remain on the Proceeds (other than those properly applied to the First-Lien Notes Obligations in accordance with the First-Lien Notes Documents but subject to the provisions of Section 4.1) of such Collateral released or disposed of subject to the relative priorities described in Section 2.1.

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In exercising rights, powers and remedies with respect to the Notes Priority Collateral, the First-Lien Notes Agent and the First-Lien Notes Claimholders may enforce the provisions of the First-Lien Notes Documents and exercise rights, powers and/or remedies thereunder and/or under applicable law or otherwise, all in such order and in such manner as provided in the First-Lien Notes Documents subject to the Notes Agents’ and the Notes Claimholders’ obligations under Sections 3.3. Such exercise and enforcement shall include the rights of an agent appointed by them to sell or otherwise dispose of the Notes Priority Collateral upon foreclosure, to incur expenses in connection with such sale or disposition, and to exercise all the rights and remedies of a secured creditor under the UCC, of a secured creditor under the Bankruptcy Laws of any applicable jurisdiction or any other applicable law.

(ii) After the Discharge of First-Lien Notes Obligations has occurred, thereafter whether or not Insolvency or Liquidation Proceeding has been commenced by or against any Grantor, the Second-Lien Notes Agent and the other Second-Lien Notes Claimholders shall have the right to enforce rights, exercise remedies (including set-off and the right to credit bid their debt) and make, in connection therewith (including voluntary Dispositions of Notes Priority Collateral by the respective Grantors after a Notes Default in respect of the Second-Lien Notes Obligations) determinations regarding the release, disposition, or restrictions with respect to the Notes Priority Collateral without any consultation with or consent of any other Notes Agent or Notes Claimholder or the ABL Agent or any ABL Claimholder subject to the Notes Agents’ and the Notes Claimholders’ obligations under Section 3.3; provided, however, that the Lien securing the Third-Lien Notes Obligations and the ABL Obligations shall remain on the Proceeds (other than those properly applied to the Second-Lien Notes Obligations in accordance with the Second-Lien Notes Documents but subject to the provisions of Section 4.1) of such Collateral released or disposed of subject to the relative priorities described in Section 2.1. In exercising rights, powers and remedies under this subsection (ii) with respect to the Notes Priority Collateral, the Second-Lien Notes Agent and the Second-Lien Notes Claimholders may enforce the provisions of the Second-Lien Notes Documents and exercise rights, powers and/or remedies thereunder and/or under applicable law or otherwise, all in such order and in such manner as provided in the Second-Lien Notes Documents subject to the Notes Agents’ and the Notes Claimholders’ obligations under Section 3.3. Such exercise and enforcement shall include the rights of an agent appointed by them to sell or otherwise dispose of the Notes Priority Collateral upon foreclosure, to incur expenses in connection with such sale or disposition, and to exercise all the rights and remedies of a secured creditor under the UCC, of a secured creditor under the Bankruptcy Laws of any applicable jurisdiction or any other applicable law.

(iii) After the Discharge of First-Lien Notes Obligations has occurred, and after the Discharge of the Second-Lien Notes has occurred, thereafter until the Discharge of the Third-Lien Notes has occurred, whether or not Insolvency or Liquidation Proceeding has been commenced by or against any Grantor, the Third-Lien Notes Agent and the other Third-Lien Notes Claimholders shall have the right to enforce rights, exercise remedies (including set-off and the right to credit bid their debt) and make, in connection therewith (including voluntary Dispositions of Notes Priority Collateral by

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the respective Grantors after a Notes Default in respect of the Third-Lien Notes Obligations) determinations regarding the release, disposition, or restrictions with respect to the Notes Priority Collateral without any consultation with or consent of any other Notes Agent or Notes Claimholder or the ABL Agent or any ABL Claimholder subject to the Notes Agents’ and the Notes Claimholders’ obligations under Section 3.3; provided, however, that the Lien securing the ABL Obligations shall remain on the Proceeds (other than those properly applied to the Third-Lien Notes Obligations in accordance with the Third-Lien Notes Documents but subject to the provisions of Section 4.1) of such Collateral released or disposed of subject to the relative priorities described in Section 2.1. In exercising rights, powers and remedies under this subsection (iii) with respect to the Notes Priority Collateral, the Third-Lien Notes Agent and the Third-Lien Notes Claimholders may enforce the provisions of the Third-Lien Notes Documents and exercise rights, powers and/or remedies thereunder and/or under applicable law or otherwise, all in such order and in such manner as provided in the Third-Lien Notes Documents subject to the Notes Agents’ and the Notes Claimholders’ obligations under Section 3.3. Such exercise and enforcement shall include the rights of an agent appointed by them to sell or otherwise dispose of the Notes Priority Collateral upon foreclosure, to incur expenses in connection with such sale or disposition, and to exercise all the rights and remedies of a secured creditor under the UCC, of a secured creditor under the Bankruptcy Laws of any applicable jurisdiction or any other applicable law.

(c) Notwithstanding anything to the contrary contained herein, any Notes Agent, any Notes Claimholder, the ABL Agent and any ABL Claimholder may:

(i) file a claim or statement of interest with respect to, in the case of any Notes Agent or Notes Claimholder, its respective Notes Obligations or in the case of the ABL Agent or any ABL Claimholder, the ABL Obligations; provided that an Insolvency or Liquidation Proceeding has been commenced by or against any Grantor;

(ii) take any action (not adverse to the priority status of the Liens of any Higher Priority Agent on the Notes Priority Collateral, or the rights of the First-Lien Notes Claimholders (or any other Higher Priority Claimholder in respect of the Notes Priority Collateral) to exercise rights, powers and/or remedies in respect thereof, including those under Article VI) in order to create, perfect, preserve or protect (but, subject to the provisions of Section 3.3, not enforce) its Lien on any of the Notes Priority Collateral;

(iii) file any necessary responsive or defensive pleadings in opposition to any motion, claim, adversary proceeding or other pleading made by any person objecting to or otherwise seeking the disallowance of the claims of such respective Notes Claimholders or the ABL Claimholders, including any claims secured by the Notes Priority Collateral, if any, in each case in accordance with the terms of this Agreement;

(iv) file any pleadings, objections, motions or agreements which assert rights or interests available to unsecured creditors of the Grantors arising under either any Insolvency or Liquidation Proceeding or applicable non-bankruptcy law, in each case not inconsistent with the terms of this Agreement or applicable law (including the

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Bankruptcy Laws of any applicable jurisdiction) and any pleadings, objections, motions or agreements which assert rights or interests available to secured creditors solely with respect to the ABL Priority Collateral of such respective Notes Agent or Notes Claimholder of the ABL Agent or ABL Claimholder; provided, however, the ABL Agent and any ABL Lender may not file any pleadings, objections, motions or agreements which assert that the Notes Obligations should not be Discharged and otherwise indefeasibly paid in full cash;

(v) vote on any Plan of Reorganization, file any proof of claim, make other filings and make any arguments, objections and motions (including in support of or opposition to, as applicable, the confirmation or approval of any Plan of Reorganization) that are, in each case, in accordance with the terms of this Agreement; provided, however, the ABL Agent and any ABL Lender may not vote on any Plan of Reorganization, make other filings or make any arguments, objections, and motions (including in support of or opposition to, as applicable, the confirmation or approval of any Plan of Reorganization) that does not Discharge the Notes Obligations or otherwise indefeasibly pay in full in cash the Notes Obligations;

(vi) exercise any of its rights, powers, and/or remedies with respect to any of the Notes Priority Collateral (A) after the termination of the respective Notes Priority Collateral Standstill Period applicable to such respective Notes Agent or ABL Agent to the extent permitted by Section 3.2(a)(i) and (B) in respect of the ABL Agent only, Section 3.3; and

(vii) take any action permitted to be taken by the ABL Agent or the ABL Claimholders described in clauses (i) through (viii) of the definition of “Enforcement”.

The Second-Lien Notes Agent, on behalf of the Second-Lien Claimholders, agrees that no Second-Lien Claimholder will take or receive any Notes Priority Collateral (including Proceeds) in connection with the exercise of any right or remedy (including set-off) with respect to any Notes Priority Collateral in its capacity as a creditor in violation of this Agreement. Without limiting the generality of the foregoing, unless and until the Discharge of First-Lien Notes Obligations has occurred, except as expressly provided in Sections 3.2(a)(i), 3.2(c), 3.3, 3.4 and 6.7, the sole right of the Second-Lien Notes Agent and the Second-Lien Notes Claimholders with respect to the Notes Priority Collateral is to hold a Lien on such Collateral pursuant to the Notes Security Documents relating to the Second-Lien Notes Obligations for the period and to the extent granted therein and to receive a share of the Proceeds thereof, if any, in accordance with Section 4.1.

The Third-Lien Notes Agent, on behalf of the Third-Lien Notes Claimholders, agrees that no Third-Lien Notes Claimholder will take or receive any Notes Priority Collateral (including Proceeds) in connection with the exercise of any right or remedy (including set-off) with respect to any Notes Priority Collateral in its capacity as a creditor in violation of this Agreement. Without limiting the generality of the foregoing, unless and until the Discharge of First-Lien Notes Obligations and the Discharge of Second-Lien Notes Obligations has occurred, except as expressly provided in Sections 3.2(a)(i), 3.2(c), 3.3, 3.4 and 6.7, the sole right of the Third-Lien Notes Agent and the Third-Lien Notes Claimholders with respect to the Notes Priority Collateral

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is to hold a Lien on such Collateral pursuant to the Notes Security Documents relating to the Third-Lien Notes Obligations for the period and to the extent granted therein and to receive a share of the Proceeds thereof, if any, in accordance with Section 4.1.

The ABL Agent, on behalf of the ABL Claimholders, agrees that no ABL Claimholder will take or receive any Notes Priority Collateral (including Proceeds) in connection with the exercise of any right or remedy (including set-off) with respect to any Notes Priority Collateral in its capacity as a creditor in violation of this Agreement. Without limiting the generality of the foregoing, unless and until the Discharge of All Notes Obligations in respect of each of the First-Lien Notes Obligations, the Second-Lien Notes Obligations and the Third-Lien Notes Obligations has occurred, except as expressly provided in Sections 3.2(a)(i), 3.2(c), 3.3, 3.4 and 6.7, the sole right of the ABL Agent and the ABL Claimholders with respect to the Notes Priority Collateral is to hold a Lien on such Collateral pursuant to the ABL Security Documents for the period and to the extent granted therein and to receive a share of the Proceeds thereof, if any, in accordance with Section 4.1.

(d) Except as otherwise specifically set forth in Sections 3.2(a) and 3.4 and Article VI, the Second-Lien Notes Agent, the Second Lien Notes Claimholders, the Third-Lien Notes Agent, the Third-Lien Notes Claimholders, the ABL Agent and the ABL Claimholders with respect to the Notes Priority Collateral, may exercise rights and remedies as unsecured creditors against any Grantor and subject to Section 3.1, may exercise rights and remedies with respect to the ABL Priority Collateral, in each case, in accordance with the terms of their respective Notes Documents or the ABL Loan Documents and applicable law; provided, however, that in the event that any of the foregoing Agents or Claimholders becomes a judgment Lien creditor in respect of Notes Priority Collateral as a result of its enforcement of its rights as an unsecured creditor with respect to the ABL Obligations or the applicable Notes Obligations, such judgment Lien shall be subject to the terms of this Agreement for all purposes (including in relation to the Notes Obligations) as the other Liens respectively securing the Second-Lien Notes Obligations, the Third-Lien Notes Obligations or the ABL Obligations are subject to this Agreement.

(e) Except as provided in Section 5.3(d), nothing in this Agreement shall prohibit the receipt by the Second-Lien Notes Agent, the Second Lien Notes Claimholders, the Third-Lien Notes Agent, the Third-Lien Notes Claimholders, the ABL Agent or any ABL Claimholders of the required payments of interest, principal and other amounts owed in respect of their respective Notes Obligations or the ABL Obligations so long as such receipt is not the direct or indirect result of the exercise by any such Agent or any such Claimholders of rights or remedies as a secured creditor (including set-off) with respect to Notes Priority Collateral or enforcement in contravention of this Agreement of any Lien held by any of them. Nothing in this Agreement impairs or otherwise adversely affects any rights or remedies the First-Lien Notes Agent or the First-Lien Notes Claimholders may have against the Grantors under the Notes Documents applicable to the First-Lien Notes Obligations.

3.3. Collateral Access Rights.

(a) The ABL Agent and each Notes Agent agree not to commence Enforcement until an Enforcement Notice has been given to each of the other Agents. Subject to the provisions

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of Sections 3.1 and 3.2, any Agent may join in any judicial proceedings commenced by another Agent to enforce Liens on the Collateral, provided that no Agent, nor the other ABL Claimholders or the other Notes Claimholders, as applicable, shall interfere with the Enforcement actions of another Agent with respect to Collateral in which such party has the priority Lien in accordance with Section 2.1 and Section 2.2. If either the ABL Agent or the First-Lien Notes Agent (in any case as described in this sentence, an “Access Agent”) becomes a party to a landlord waiver or bailee’s letter or similar agreement (“Access Agreement”) with respect to any assets of the Parent or its Subsidiaries, but the other Agent (“Non-Access Agent”) is not a party to such Access Agreement or a similar Access Agreement with respect to such assets, then the Access Agent shall promptly notify the Non-Access Agent in writing of that fact and, notwithstanding the rights conferred on the Access Agent under such Access Agreement, the Access Agent shall only exercise rights under such Access Agreement with respect to (i) ABL Priority Collateral if the Access Agent in respect of the respective subject Access Agreement is the ABL Agent or (ii) Notes Priority Collateral if the Access Agent in respect of the respective subject Access Agreement is the First-Lien Notes Agent; provided that (A) at the request of the Non-Access Agent, the Access Agent may, in its sole discretion, exercise rights under such Access Agreement with respect to the priority Collateral of the Non-Access Agent; and (B) the foregoing terms of this sentence shall apply to and bind each successive Higher Priority Agent that is an Access Agent in relation to the ABL Priority Collateral or Notes Priority Collateral respectively as if such Agent were named in the preceding terms of this sentence as applicable until Discharge of all Higher Priority Obligations in relation to the applicable ABL Priority Collateral or Notes Priority Collateral respectively covered by the above-described terms of access under any particular Access Agreement so as to effectuate compliance and consistency with the intent of preceding terms of this sentence.

(b) If any Notes Agent, or any agent or representative of any Notes Agent, or any receiver, shall, after any Notes Default, obtain possession or physical control of any of the Mortgaged Premises, such Notes Agent shall promptly notify the ABL Agent in writing of that fact, and the ABL Agent shall, within ten (10) Business Days thereafter, notify such Notes Agent in writing as to whether the ABL Agent desires to exercise access rights under this Agreement. In addition, if the ABL Agent, or any agent or representative of the ABL Agent, or any receiver, shall obtain possession or physical control of any of the Mortgaged Premises or any of the tangible Notes Priority Collateral located on any premises other than a Mortgaged Premises, following the delivery to such Note Agent of an Enforcement Notice, then the ABL Agent shall promptly notify such Note Agent in writing that the ABL Agent is exercising its access rights under this Agreement under either circumstance. Upon delivery of such notice by the ABL Agent to such Notes Agent, the parties shall confer in good faith to coordinate with respect to the ABL Agent’s exercise of such access rights. Consistent with the definition of “Access Period,” access rights will apply to differing parcels of Mortgaged Premises at differing times, in which case, a differing Access Period will apply to each such property. References to the Notes Agent in this Section 3.3 shall be deemed to be references to the Notes Agent then having controlling rights as a secured creditor in accordance with Sections 2.1, 3.2(b) and 6.1.

(c) During any pertinent Access Period, the ABL Agent and its agents, representatives and designees shall have an irrevocable, non-exclusive right to have access to, and a rent-free right to use, the Notes Priority Collateral for the purpose of (i) copying, using, or

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preserving any and all information relating to any of the ABL Priority Collateral, (ii) arranging for and effecting the sale or disposition of ABL Priority Collateral located on such parcel, (iii) selling (by public auction, private sale or a “store closing”, “going out of business” or similar sale, whether in bulk, in lots or to customers in the ordinary course of business or otherwise and which sale may include augmented Inventory of the same type sold in any Grantor’s business), and (iv) storing or otherwise dealing with the ABL Priority Collateral, in each case without interference by any Notes Agent or any Notes Claimholder or liability (except as and to the extent specifically set forth below in this Section 3.3(c)) to any Notes Agent or any Notes Claimholder. During any such Access Period, the ABL Agent and its representatives (and persons employed on their behalf), may continue to operate, service, maintain, process and sell the ABL Priority Collateral, as well as to engage in bulk sales of ABL Priority Collateral. The ABL Agent shall take proper and reasonable care under the circumstances of any Notes Priority Collateral that is used by the ABL Agent during the Access Period and repair and replace any damage (ordinary wear-and-tear excepted) caused by the ABL Agent or its agents, representatives or designees, and the ABL Agent shall comply with all applicable laws in all material respects in connection with its use or occupancy of the Notes Priority Collateral. The ABL Agent and the ABL Claimholders shall reimburse the applicable Notes Agent and the Notes Claimholders for any injury or damage to Persons or property (ordinary wear-and-tear excepted) caused by the acts or omissions of Persons under its control; provided, however, that the ABL Agent and the ABL Claimholders will not be liable for any diminution in the value of the Mortgaged Premises caused by the absence of the ABL Priority Collateral therefrom. In no event shall the ABL Claimholders or the ABL Agent have any liability to any Notes Claimholders and/or to any Notes Agent hereunder as a result of any condition (including any environmental condition, claim or liability) on or with respect to the Notes Priority Collateral existing prior to the date of the exercise by the ABL Agent of its rights under this Agreement. The ABL Agent and each applicable Notes Agent shall cooperate and use reasonable efforts to ensure that their activities during the Access Period as described above do not interfere materially with the activities of the other as described above, including the right of the applicable Notes Agent to show the Notes Priority Collateral to prospective purchasers and to ready the Notes Priority Collateral for sale.

(d) Consistent with the definition of the term “Access Period,” if any order or injunction is issued or stay is granted or is otherwise effective by operation of law that prohibits the ABL Agent from exercising any of its rights hereunder, then the Access Period granted to the ABL Agent under this Section 3.3 shall be stayed during the period of such prohibition and shall continue thereafter consistent with the definition of the term “Access Period”. No Notes Agent shall foreclose or otherwise sell or dispose of any of the Notes Priority Collateral during the Access Period, unless the buyer agrees in writing to acquire the Notes Priority Collateral subject to the terms of Section 3.3 of this Agreement and agrees therein to comply with the terms of this Section 3.3, and the rights of the ABL Agent and the ABL Claimholders under this Section 3.3 during the Access Period shall continue notwithstanding such foreclosure, sale or other disposition by any Notes Agent; provided, however, that the ABL Agent and the applicable Notes Agent shall confer in good faith, prior to and (if not theretofore resolved to the satisfaction of the ABL Agent) after any foreclosure, sale or other disposition, to determine the method for satisfying the access rights of the ABL Agent under this Section 3.3 and if the ABL Agent shall be satisfied (in its sole discretion) that it has or will have adequate access rights, then the ABL Agent shall promptly agree in a separate writing to waive any access rights beyond those rights that are satisfactory to the ABL Agent as aforesaid.

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(e) The ABL Agent and the ABL Claimholders shall have the right to bring an action to enforce their rights under this Section 3.3, including, without limitation, an action seeking possession of the applicable Collateral and/or specific performance of this Section 3.3.

3.4. Set-Off and Tracing of and Priorities in Proceeds. Each Notes Agent, on behalf of the respective Notes Claimholders, and the ABL Agent, on behalf of the ABL Claimholders, acknowledges and agrees that, to the extent of any exercise of rights of set-off in accordance with this Agreement against any ABL Priority Collateral or Notes Priority Collateral, the amount of such set-off shall be held and distributed pursuant to Section 4.1. Each Notes Agent, on behalf of the respective Notes Claimholders, acknowledges and agrees that, to the extent such Notes Agent or any such Notes Claimholder exercises its rights of set-off in accordance with this Agreement against any Notes Priority Collateral, the amount of such set-off shall be held and distributed pursuant to Section 4.1. The ABL Agent, for itself and on behalf of the ABL Claimholders, and each Notes Agent, for itself and on behalf of the respective Notes Claimholders, further agree that prior to issuance of an Enforcement Notice by any Agent, ABL Claimholder or Notes Claimholder, or the commencement of any Insolvency or Liquidation Proceeding, any Proceeds of Collateral, whether or not deposited under Account Agreements, which are used by any Grantor to acquire other property which is Collateral shall not (solely as among the Agents, the ABL Claimholders and the Notes Claimholders) be treated as Proceeds of Collateral for purposes of determining the relative priorities in the Collateral which was so acquired. In addition, unless and until the Discharge of ABL Obligations occurs, subject to Section 4.2, each Notes Agent and the Notes Claimholders each hereby consents to the application, prior to the receipt by the ABL Agent of an Enforcement Notice issued by the applicable Notes Agent, of cash or other Proceeds of Collateral, deposited under Account Agreements to the repayment of ABL Obligations pursuant to the ABL Loan Documents.

IV. PAYMENTS.

4.1. Application of Proceeds.

(a) (i) So long as the Discharge of ABL Obligations has not occurred, whether or not any Insolvency or Liquidation Proceeding has been commenced by or against any Grantor, (A) all ABL Priority Collateral or Proceeds thereof received in connection with the sale or other disposition of, or collection on, such ABL Priority Collateral upon the exercise of remedies or other Enforcement by any Agent or any ABL Claimholders or Notes Claimholders, shall be delivered to the ABL Agent and shall be applied or further distributed by the ABL Agent to or on account of the ABL Obligations in such order, if any, as specified in the relevant ABL Loan Documents or as a court of competent jurisdiction may otherwise direct and (B) all ABL Priority Collateral consisting of Accounts shall be deemed to be sold or disposed of at a valuation equal to the face amount of each such Account.

(ii) Upon the Discharge of ABL Obligations, the ABL Agent shall deliver to the First-Lien Notes Agent any Collateral and Proceeds of Collateral received or delivered to it pursuant to the preceding sentence, in the same form as received, with

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any necessary endorsements, to be applied by the First-Lien Notes Agent to the First-Lien Notes Obligations in such order as specified in the First-Lien Notes Documents or as a court of competent jurisdiction may otherwise direct.

(iii) Upon the Discharge of First-Lien Notes Obligations, the First-Lien Notes Agent shall deliver to the Second-Lien Notes Agent any Collateral and Proceeds of Collateral received or delivered to it pursuant to the preceding sentence, in the same form as received, with any necessary endorsements, to be applied by the Second-Lien Notes Agent to the Second-Lien Notes Obligations in such order as specified in the Second-Lien Notes Documents or as a court of competent jurisdiction may otherwise direct.

(iv) Upon the Discharge of Second-Lien Notes Obligations, the Second-Lien Notes Agent shall deliver to the Third-Lien Notes Agent any Collateral and Proceeds of Collateral received or delivered to it pursuant to the preceding sentence, in the same form as received, with any necessary endorsements, to be applied by the Third-Lien Notes Agent to the Third-Lien Notes Obligations in such order as specified in the Third-Lien Notes Documents or as a court of competent jurisdiction may otherwise direct.

(b) (i) So long as the Discharge of First-Lien Notes Obligations has not occurred, whether or not any Insolvency or Liquidation Proceeding has been commenced by or against any Grantor, all Notes Priority Collateral or Proceeds thereof received in connection with the sale or other disposition of, or collection on, such Notes Priority Collateral upon the exercise of remedies or other Enforcement by any Agent or any Notes Claimholders or ABL Claimholders, shall be delivered to the First-Lien Notes Agent and shall be applied by the First-Lien Notes Agent to the First-Lien Notes Obligations in such order as specified in the First-Lien Notes Documents or as a court of competent jurisdiction may otherwise direct.

(ii) Upon the Discharge of First-Lien Notes Obligations, the First-Lien Notes Agent shall deliver to the Second-Lien Notes Agent any Collateral and Proceeds of Collateral received or delivered to it pursuant to the preceding sentence, in the same form as received, with any necessary endorsements to be applied by the Second-Lien Notes Agent to the Second-Lien Notes Obligations in such order as specified in the Second-Lien Notes Documents or as a court of competent jurisdiction may otherwise direct.

(iii) Upon the Discharge of Second-Lien Notes Obligations, the Second-Lien Notes Agent shall deliver to the Third-Lien Notes Agent any Collateral and Proceeds of Collateral received or delivered to it pursuant to the preceding sentence, in the same form as received, with any necessary endorsements to be applied by the Third-Lien Notes Agent to the Third-Lien Notes Obligations in such order as specified in the Third-Lien Notes Documents or as a court of competent jurisdiction may otherwise direct.

(iv) Upon the Discharge of Third-Lien Notes Obligations, the Third-Lien Notes Agent shall deliver to the ABL Agent any Collateral and Proceeds of Collateral received or delivered to it pursuant to the preceding sentence, in the same form as received, with any necessary endorsements to be applied by the ABL Agent to the ABL Obligations in such order as specified in the ABL Security Documents relating to the ABL Obligations or as a court of competent jurisdiction may otherwise direct.

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4.2. Payments Over in Violation of Agreement. So long as neither the Discharge of ABL Obligations nor the Discharge of All Notes Obligations has occurred, whether or not any Insolvency or Liquidation Proceeding has been commenced by or against any Grantor, any Collateral (including assets or Proceeds subject to Liens referred to in the final sentence of Section 2.3) received by any Agent or any Notes Claimholders or ABL Claimholders in connection with the exercise of any right, power, or remedy (including set-off) relating to the Collateral in contravention of this Agreement shall be segregated and held in trust and forthwith paid over to the appropriate Agent for the benefit of the appropriate Notes Claimholders or the ABL Claimholders, as applicable, in the same form as received, with any necessary endorsements or as a court of competent jurisdiction may otherwise direct. The foregoing terms of this Section 4.2 shall apply to and bind each successive Higher Priority Agent in relation to the ABL Priority Collateral or Notes Priority Collateral respectively (as if such Agent were named in the preceding sentences of this Section 4.2) as applicable until Discharge of all Higher Priority Obligations in relation to the applicable ABL Priority Collateral or Notes Priority Collateral respectively so as to effectuate compliance and consistency with the applicable order of Liens priority set forth in this Agreement. Each Agent is hereby authorized by the other Agents to make any such endorsements as agent for the other appropriate Agent or any appropriate Notes Claimholders or ABL Claimholders, as applicable. This authorization is coupled with an interest and is irrevocable until the Discharge of ABL Obligations and Discharge of All Notes Obligations.

4.3. Application of Payments. Subject to the other terms of this Agreement, all payments received by (a) the ABL Agent or the ABL Claimholders may be applied, reversed and reapplied, in whole or in part, to the ABL Obligations to the extent provided for in the ABL Loan Documents; (b) the First-Lien Notes Agent or the First-Lien Notes Claimholders may be applied, reversed and reapplied, in whole or in part, to the First-Lien Notes Obligations to the extent provided for in the First-Lien Notes Documents; (c) the Second-Lien Notes Agent or the Second-Lien Notes Claimholders may be applied, reversed and reapplied, in whole or in part, to the Second-Lien Notes Obligations to the extent provided for in the Second-Lien Notes Documents; and (d) the Third-Lien Notes Agent or the Third-Lien Notes Claimholders may be applied, reversed and reapplied, in whole or in part, to the Third-Lien Notes Obligations to the extent provided for in the Third-Lien Notes Documents.

4.4. Revolving Nature of ABL Obligations. Each Notes Agent, on behalf of its respective Notes Claimholders, acknowledges and agrees that the ABL Credit Agreement includes a revolving commitment and that the amount of the ABL Obligations that may be outstanding at any time or from time to time may be increased or reduced and subsequently reborrowed.

V. OTHER AGREEMENTS.

5.1. Releases.

(a) (i) If, in connection with (A) any exercise of remedies or Enforcement (including as provided for in Section 3.1(b) or Section 6.8(a)), or (B) any sale, transfer or other

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disposition of all or any portion of the ABL Priority Collateral (other than in connection with a Refinancing as described in Section 5.5), so long as, in the case of this clause (B), such sale, transfer or other disposition is then not prohibited by the ABL Loan Documents (or consented to by the requisite ABL Lenders) and by any of the Notes Documents (or consented to by the requisite Noteholders under the applicable Notes Documents), irrespective of whether an ABL Default has occurred and is continuing, the ABL Agent, on behalf of any of the ABL Claimholders, releases any of its Liens on any part of the ABL Priority Collateral, then the Liens, if any, of each Notes Agent, for the benefit of each Notes Claimholders, on the Collateral sold or disposed of in connection therewith, shall be automatically, unconditionally and simultaneously released; provided that, to the extent the Proceeds of such ABL Priority Collateral are not applied to reduce ABL Obligations, each Notes Agent shall retain a Lien on such Proceeds in accordance with the terms of this Agreement. Each Notes Agent, on behalf of the Notes Claimholders, promptly shall execute and deliver to the ABL Agent or such Grantor such termination statements, releases and other documents as the ABL Agent or such Grantor may request in writing to effectively confirm such release. Following Discharge of the ABL Obligations, the rights of the ABL Agent under this Section 5.1(a)(i) shall become rights of the Agent representing the next Higher Priority Obligations in respect of ABL Priority Collateral and seriatim thereafter following Discharge of each successive class of Higher Priority Obligations in respect of ABL Priority Collateral.

(ii) If, in connection (A) with any exercise of remedies or Enforcement (including as provided for in Sections 3.2(b) or Section 6.8(b)), or (B) any sale, transfer or other disposition of all or any portion of the Notes Priority Collateral (other than in connection with a Refinancing as described in Section 5.5), so long as, in the case of this clause (B), such sale, transfer or other disposition is then not prohibited by any of the Notes Documents (or consented to by the requisite Noteholders under the applicable Notes Documents) and by the ABL Loan Documents (or consented to by the requisite ABL Lenders), irrespective of whether a Notes Default under the First-Lien Notes Documents has occurred and is continuing, the First-Lien Notes Agent, on behalf of any of the Notes Claimholders, releases any of its Liens on any part of the Notes Priority Collateral, then the Liens, if any, of the other Notes Agents for the benefit of their respective Notes Claimholders and of the ABL Agent, for the benefit of the ABL Claimholders, on the Collateral sold or disposed of in connection therewith, shall be automatically, unconditionally and simultaneously released; provided that the provisions of Section 3.3 shall continue, to the extent such Section is applicable at the time of such sale, transfer or other disposition; provided further that, to the extent the Proceeds of such Notes Priority Collateral are not applied to reduce First-Lien Notes Obligations, the other Notes Agents and the ABL Agent shall retain a Lien on such Proceeds in accordance with the terms of this Agreement. The other Notes Agents on behalf of their respective Notes Claimholders and the ABL Agent, on behalf of the ABL Claimholders, promptly shall execute and deliver to the First-Lien Notes Agent or such Grantor such termination statements, releases and other documents as the First-Lien Notes Agent or such Grantor may request to effectively confirm such release. Following Discharge of the First-Lien Notes Obligations, the rights of the First-Lien Notes Agent under this Section 5.1(a)(ii) shall become rights of the Agent representing the next Higher Priority Obligations in respect of Notes Priority Collateral, and seriatim thereafter following Discharge of each successive class of Higher Priority Obligations in respect of Notes Priority Collateral.

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(b) Until the Discharge of ABL Obligations and Discharge of All Notes Obligations shall occur, the ABL Agent, on behalf of the ABL Claimholders, and each Notes Agent, on behalf of its respective Notes Claimholders, as applicable, hereby irrevocably constitutes and appoints each of the other Agents and any officer or agent of each of the other Agents, with full power of substitution, as its true and lawful attorney-in-fact with full irrevocable power and authority in the place and stead of each of the other Agents or such holder or in each Agent’s own name, from time to time in such Agent’s discretion exercised in good faith, for the purpose of carrying out the terms of this Section 5.1, to take any and all appropriate action and to execute any and all documents and instruments which may be necessary to accomplish the purposes of this Section 5.1, including any endorsements or other instruments of transfer or release.

(c) Until the Discharge of ABL Obligations and Discharge of All Notes Obligations shall occur, to the extent that the Agents or the ABL Claimholders or the Notes Claimholders (i) have released any Lien on Collateral and such Lien is later reinstated or (ii) obtain any new Liens from any Grantor or any Grantor takes any action to perfect a Lien, then, in accordance with Section 2.3, the Grantors shall grant or perfect a Lien on any such Collateral, subject to the Lien priority provisions of this Agreement, to the other Agents, for the benefit of the ABL Claimholders or appropriate Notes Claimholders, as applicable.

5.2. Insurance.

(a) Unless and until the Discharge of ABL Obligations and subject to the terms of, and the rights of the Grantors under, the ABL Loan Documents, the ABL Agent, on behalf of the ABL Claimholders, shall have the sole and exclusive right to adjust settlement for any insurance policy covering the ABL Priority Collateral in the event of any loss thereunder and to approve any award granted in any condemnation or similar proceeding (or any deed in lieu of condemnation) affecting such Collateral. Until the Discharge of ABL Obligations has occurred, (i) all Proceeds of any such policy and any such award (or any payments with respect to a deed in lieu of condemnation) if in respect of the ABL Priority Collateral and to the extent required by the ABL Loan Documents shall be paid to the ABL Agent for the benefit of the ABL Claimholders pursuant to the terms of the ABL Loan Documents (including, without limitation, for purposes of cash collateralization of letters of credit) and thereafter, if the Discharge of ABL Obligations has occurred, and subject to the rights of the Grantors under the Notes Security Documents, seriatim thereafter in full to the Agent representing the next successive Higher Priority Obligations in relation to the ABL Priority Collateral for the benefit of the Claimholders of such respective Higher Priority Obligations to the extent required under the Notes Security Documents relating to such respective Higher Priority Obligations until Discharged, and then, to the extent no Notes Obligations are outstanding, to the owner of the subject property, such other Person as may be entitled thereto or as a court of competent jurisdiction may otherwise direct, and (ii) if any Notes Agent or any Notes Claimholders shall, at any time, receive any Proceeds of any such insurance policy or any such award or payment with respect to ABL Priority Collateral in contravention of this Agreement, it shall segregate and hold in trust and forthwith pay such Proceeds over to the ABL Agent in accordance with the terms of Section 4.2, or if the ABL Obligations have been Discharged, to the next Higher Priority Agent in relation to ABL Priority Collateral.

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(b) Unless and until the Discharge of First-Lien Notes Obligations has occurred, subject to the terms of, and the rights of the Grantors under, the First-Lien Notes Documents, (i) the First-Lien Notes Agent, on behalf of the First-Lien Notes Claimholders, shall have the sole and exclusive right to adjust settlement for any insurance policy covering the Notes Priority Collateral in the event of any loss thereunder and to approve any award granted in any condemnation or similar proceeding (or any deed in lieu of condemnation) affecting such Collateral; (ii) all Proceeds of any such policy and any such award (or any payments with respect to a deed in lieu of condemnation) if in respect of the Notes Priority Collateral and to the extent required by the First-Lien Notes shall be paid to the First-Lien Notes Agent for the benefit of the First-Lien Notes Claimholders pursuant to the terms of the First-Lien Notes Documents and thereafter, if the Discharge of First-Lien Notes Obligations has occurred, and subject to the rights of the Grantors under other Notes Documents or the ABL Loan Documents, seriatim thereafter in full to the Agent representing the next successive Higher Priority Obligations in relation to the Notes Priority Collateral for the benefit of the Claimholders of such respective Higher Priority Obligations to the extent required under the Notes Security Documents or ABL Security Documents as applicable until Discharged, and then, to the extent no Notes Obligations and ABL Obligations are outstanding, to the owner of the subject property, such other Person as may be entitled thereto or as a court of competent jurisdiction may otherwise direct, and (iii) if a Notes Agent, any Notes Claimholders, the ABL Agent or any ABL Claimholders shall, at any time, receive any Proceeds of any such insurance policy or any such award or payment with respect to Notes Priority Collateral in contravention of this Agreement, it shall segregate and hold in trust and forthwith pay such Proceeds over to the First-Lien Notes Agent in accordance with the terms of Section 4.2, or if the First-Lien Notes Obligations have been discharged, to the next Higher Priority Agent in relation to Notes Priority Collateral.

(c) To effectuate the foregoing, and to the extent that the pertinent insurance company agrees to issue such endorsements, the Agents shall each receive separate lender’s loss payable endorsements naming themselves as loss payee and additional insured, as their interests may appear, with respect to policies which insure Collateral hereunder.

5.3. Amendments to ABL Loan Documents and Notes Documents; Refinancing.

(a) Subject to Sections 5.3(d) and 5.3(e), the ABL Loan Documents and Notes Documents may be amended, restated, supplemented or otherwise modified in accordance with their terms, all without affecting the Lien subordination or other provisions of this Agreement. The ABL Obligations may be Refinanced without notice to, or the consent of any Notes Agent or any Notes Claimholders and without affecting the Lien subordination or other provisions of this Agreement, and the respective Notes Obligations may be Refinanced without notice to, or consent of, the ABL Agent or the ABL Claimholders or any other Notes Agent or Notes Claimholders and without affecting the Lien subordination and other provisions of this Agreement so long as such Refinancing is on terms and conditions that would not violate the Notes Documents or the ABL Loan Documents, each as in effect on the date hereof (or, if less restrictive to the Company, as in effect on the date of such amendment or Refinancing); provided, however, that, in each case, the lenders or holders of such Refinancing debt bind themselves in a writing addressed to each other Agent and the related Claimholders, as applicable, to the terms of this Agreement; provided further, however, that, if such Refinancing debt is secured by a Lien on any Collateral the holders of such Refinancing debt shall be deemed bound by the terms hereof regardless of whether or not

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such writing is provided. For the avoidance of doubt, the sale or other transfer of Indebtedness is not restricted by this Agreement but the provisions of this Agreement shall be binding on all holders of ABL Obligations and Notes Obligations.

(b) [Reserved].

(c) Subject to Sections 5.3(d) and 5.3(e), each Agent shall each use good faith efforts to notify the other Agents, in writing, of any written amendment or modification to its respective ABL Loan Documents and Notes Documents, but the failure to do so shall not create a cause of action against the party failing to give such notice or create any claim or right on behalf of any third party.

(d) Without the consent of each Notes Agent, the ABL Claimholders will not be entitled to agree (and will not agree) to any amendment to or modification of the ABL Loan Documents, whether in a Refinancing or otherwise, that is not permitted by each Indenture as in effect on the date hereof (or, if less restrictive to the ABL Claimholders, on the date of such amendment or modification).

(e) Without the consent of the ABL Agent and each other Notes Agent, no Notes Agent nor the related Notes Claimholders will be entitled to agree (and none will agree) to any amendment to or modification of its respective Notes Documents, whether in a Refinancing or otherwise, that is not permitted by the ABL Credit Agreement as in effect on the date hereof and the other Indentures as in effect on the date hereof (or, if less restrictive to the Notes Claimholders then amending or modifying their Notes Documents, on the date of such amendment or modification).

(f) So long as the Discharge of ABL Obligations has not occurred and so long as the Discharge of All Notes Obligations has not occurred, each Notes Agent agrees that each applicable Notes Security Document shall include the following language (or similar language acceptable to the ABL Agent and to the First-Lien Notes Agent): “Notwithstanding anything herein to the contrary, the liens and security interests granted to [applicable Notes Agent], as Collateral Agent, pursuant to this Agreement and the exercise of any right or remedy by [applicable Notes Agent], as Collateral Agent hereunder, are subject to the provisions of the Intercreditor Agreement dated as of October 5, 2011 (as amended, restated, supplemented or otherwise modified from time to time, the “Intercreditor Agreement”), among Wells Fargo Capital Finance, LLC, as ABL Agent, [applicable Notes Agent], as Notes Agent, certain other “Agents” and the Grantors (as defined in the Intercreditor Agreement) from time to time party thereto. In the event of any conflict between the terms of the Intercreditor Agreement and the terms of this Agreement, the terms of the Intercreditor Agreement shall govern and control.”

(g) So long as the Discharge of All Notes Obligations has not occurred, the ABL Agent agrees that each applicable ABL Security Document shall include the following language (or similar language acceptable to the First-Lien Note Agent): “Notwithstanding anything herein to the contrary, the liens and security interests granted to the Agent pursuant to this Agreement and the exercise of any right or remedy by the Agent hereunder, are subject to the provisions of the Intercreditor Agreement dated as of October 5, 2011 (as amended, restated, supplemented or otherwise modified from time to time, the “Intercreditor Agreement”), among the

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Agent, as ABL Agent, [applicable Notes Agent], as Trustee and Collateral Agent, as Notes Agent, certain other “Agents” and the Grantors (as defined in the Intercreditor Agreement) from time to time party thereto. In the event of any conflict between the terms of the Intercreditor Agreement and the terms of this Agreement, the terms of the Intercreditor Agreement shall govern and control.”

5.4. Bailees for Perfection.

(a) Each Agent agrees to hold that part of the Collateral that is in its possession or control (or in the possession or control of its agents or bailees) to the extent that possession or control thereof is taken to perfect a Lien thereon (such Collateral, which shall include without limitation Account Agreements, Instruments and Capital Stock, being the “Pledged Collateral”) as (i) in the case of the ABL Agent, the collateral agent for the ABL Claimholders under the ABL Loan Documents or, in the case of any Notes Agent, the collateral agent for the respective Notes Claimholders under the related Notes Documents and (ii) gratuitous bailee for the benefit of and on behalf of the other Agents (such bailment being intended, among other things, to satisfy the requirements of Sections 8-301(a)(2) and 9-313(c) of the UCC) and any assignee solely for the purpose of perfecting the security interest granted under the ABL Loan Documents and the applicable Notes Documents, respectively, subject to the terms and conditions of this Section 5.4. Each Notes Agent and the related Notes Claimholders hereby appoint the ABL Agent as their gratuitous bailee for the purposes of perfecting their security interest in all Deposit Accounts and Securities Accounts of the Company and the Company’s Subsidiaries. The ABL Agent hereby accepts such appointment and acknowledges and agrees that it shall act for the benefit of and on behalf of each Notes Agent and the other related Notes Claimholders under each Account Agreement and that any Proceeds received by the ABL Agent under any Account Agreement shall be applied in accordance with Article IV.

(b) No Agent shall have any obligation whatsoever to any other Agent or to any other Claimholder to ensure that the Pledged Collateral is genuine or owned by any of the Grantors or to preserve rights or benefits of any Person except as expressly set forth in this Section 5.4. The duties or responsibilities of the respective Agents under this Section 5.4 shall be limited solely to holding the Pledged Collateral as bailee in accordance with this Section 5.4 and delivering the Pledged Collateral or Proceeds thereof upon a Discharge of ABL Obligations, Discharge of First-Lien Notes Obligations, Discharge of Second-Lien Notes Obligations or Discharge of Third-Lien Notes Obligations, as applicable, as provided in paragraph (d) below, and each Agent and its related Claimholders hereby releases each other Agent from any liability of any kind and waives any right to make claim for any damages, costs or liabilities, by reason of or arising out of the terms of Section 5.4(a).

(c) No Agent acting pursuant to this Section 5.4 shall have by reason of the ABL Loan Documents, any of the Notes Documents, this Agreement or any other document a fiduciary relationship in respect of any other Agent, any ABL Claimholder or any Notes Claimholder.

(d) Upon the Discharge of ABL Obligations, the Discharge of First-Lien Notes Obligations, Discharge of Second-Lien Notes Obligations or Discharge of Third-Lien Notes

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Obligations, as applicable, the Agent under the ABL Credit Agreement or Note Agreement, as applicable, that has been Discharged shall deliver the remaining Pledged Collateral (if any) in its possession together with any necessary endorsements, first, to the Agent representing the next Higher Priority Obligation (below that of the delivering Agent) in relation to the item of ABL Priority Collateral or Notes Priority Collateral then being delivered (as applicable) to the extent such other Obligations remain outstanding, and second, to the applicable Grantor to the extent the Discharge of ABL Obligations and the Discharge of All Notes Obligations have occurred (in each case, so as to allow such Person to obtain possession or control of such Pledged Collateral) or as otherwise required by law. Each Agent further agrees to take all other action reasonably requested by the other applicable Agent in connection with the other applicable Agent obtaining a first-priority interest in the Collateral or as a court of competent jurisdiction may otherwise direct. Notwithstanding anything to the contrary contained in this Agreement, any obligation of any Agent, which has been Discharged, to make any delivery to any other Agent under this Section 5.4(d) or Section 5.5 is subject to (i) the order of any court of competent jurisdiction, or (ii) any automatic stay imposed in connection with any Insolvency or Liquidation Proceeding.

(e) Subject to the terms of this Agreement, (i) so long as the Discharge of ABL Obligations has not occurred, the ABL Agent (after Discharge of the ABL Obligations, seriatim, the Higher Priority Agent in respect of the ABL Priority Collateral, in lieu of the ABL Agent or the Notes Agent based on the Liens priority set forth in this Agreement) shall be entitled to deal with the Pledged Collateral or Collateral within its “control” in accordance with the terms of this Agreement and other ABL Loan Documents, but only to the extent that such Collateral constitutes ABL Priority Collateral, as if the Liens of the Notes Agents on behalf of the respective Notes Claimholders did not exist and, after Discharge of the ABL Obligations, as if the Liens of any other Notes Agents on behalf of Notes Claimholders having Liens priority ranking lower than that of the Higher Priority Agent then entitled to act pursuant to this clause (i) did not exist, and (ii) so long as the Discharge of First-Lien Notes Obligations has not occurred, the First-Lien Notes Agent (after Discharge of the First-Lien Notes Obligations, seriatim, the Higher Priority Agent in respect of the Notes Priority Collateral, in lieu of the First-Lien Notes Agent or another Agent based on the Liens priority set forth in this Agreement) shall be entitled to deal with the Pledged Collateral or Collateral within its “control” in accordance with the terms of this Agreement and other applicable Notes Documents, but only to the extent that such Collateral constitutes Notes Priority Collateral, as if the Liens of the ABL Agent on behalf of the ABL Claimholders did not exist and as if the Liens of any other Notes Agents on behalf of Notes Claimholders having Liens priority ranking lower than that of the Higher Priority Agent then entitled to act pursuant to this clause (ii) did not exist.

5.5. When Discharge of ABL Obligations and Discharge of Notes Obligations Deemed to Not Have Occurred. If at any time after the Discharge of ABL Obligations or a Discharge of particular Notes Obligations, the Company shall enter into any Permitted Refinancing of any ABL Obligation or Notes Obligation, as applicable, then such Discharge of ABL Obligations or the Discharge of particular Notes Obligations shall automatically be deemed not to have occurred for all purposes of this Agreement (other than with respect to any actions taken as a result of the occurrence of such first Discharge of ABL Obligations or the Discharge of particular Notes Obligations in order to effectuate such discharge among (i) the agent(s) and other claimholders under the facility to be discharged, (ii) the agents and other claimholders

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under the new facility, and (iii) the Company and the Company’s Subsidiaries), and, from and after the date on which the New Debt Notice is delivered to the appropriate Agent in accordance with the next sentence, the obligations under such Permitted Refinancing shall automatically be treated as ABL Obligations or Notes Obligations (of the same class of Notes Obligations so Refinanced) for all purposes of this Agreement, as applicable, including for purposes of the Lien priorities and rights in respect of Collateral set forth herein, and the ABL Agent or respective Notes Agent, as applicable, under such new ABL Loan Documents or respective Notes Documents, as applicable, shall be the ABL Agent or respective Notes Agent, as applicable, for all purposes of this Agreement. Upon receipt of a notice (substantially in the form attached to this Agreement as Exhibit B, the “New Debt Notice”) stating that the Company has entered into new ABL Loan Documents or new Notes Documents (which notice shall include a complete copy of the relevant new documents and provide the identity of the new Agent, such agent, the “New Agent”), the other Agents and the New Agent shall promptly (a) enter into a joinder hereto, substantially in the form attached hereto as Exhibit A, such documents and agreements (including amendments or supplements to this Agreement) as the Company or such New Agent shall reasonably request in order to provide to the New Agent the rights contemplated hereby, in each case consistent in all material respects with the then terms of this Agreement based on the Lien priorities and related rights and obligations previously held by the former Agent replaced by such New Agent and (b) deliver to the New Agent (if appropriate, based on the Lien priorities and related rights and obligations previously held by the former Agent replaced by such New Agent) any Pledged Collateral held by it together with any necessary endorsements (or otherwise allow the New Agent to obtain control of such Pledged Collateral (if appropriate, based on the Lien priorities and related rights and obligations previously held by the former Agent replaced by such New Agent)). In accordance with Section 5.3(a), the New Agent shall agree in a writing addressed to the other Agents and the ABL Claimholders or the other Notes Claimholders, as applicable, to be bound by the terms of this Agreement.

5.6. Certain Dispositions and Covenants Prior to Enforcement. Notwithstanding any provision contained herein to the contrary but subject to the limitations set forth in Sections 5.3(d) and (e), prior to delivery of an Enforcement Notice in accordance with the terms of this Agreement, the rights of each Agent (and the respective Claimholders for which it acts as described in this Agreement) relating to dispositions of Collateral and negative covenants in respect thereof are not governed by the terms of this Intercreditor Agreement but instead are and shall be governed (a) by the ABL Loan Documents as between the Grantors and the ABL Claimholders, (b) by the First-Lien Notes Documents as between the Grantors and the First-Lien Notes Claimholders, (c) by the Second-Lien Notes Documents as between the Grantors and the Second-Lien Notes Claimholders, and (d) by the Third-Lien Notes Documents as between the Grantors and the Third-Lien Notes Claimholders.

VI. INSOLVENCY OR LIQUIDATION PROCEEDINGS.

6.1. Finance Issues.

(a) Each Notes Agent, on behalf of its respective Notes Claimholders, hereby agrees that, until the Discharge of ABL Obligations has occurred, if any Grantor shall be subject to any Insolvency or Liquidation Proceeding and the ABL Agent shall desire to permit the use of “Cash Collateral” (as such term is defined in Section 363(a) of the Bankruptcy Code) constituting

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ABL Priority Collateral or to permit any Grantor to obtain financing, whether from the ABL Claimholders or any other Person under Section 364 of the Bankruptcy Code or any similar Bankruptcy Law secured by a Lien on ABL Priority Collateral and with a superpriority administrative expense claim against such Grantor (collectively, “ABL DIP Financing”), then no Notes Claimholder will be entitled to raise (and no Notes Claimholder will raise or support any Person in raising), but instead shall be deemed to have hereby irrevocably and absolutely waived, any objection to, and shall not otherwise in any manner be entitled to oppose or will oppose or support any Person in opposing, such Cash Collateral use or ABL DIP Financing (including, except as expressly provided in this Article VI, that the Notes Claimholders are entitled to adequate protection of their interest in the ABL Priority Collateral as a condition thereto) so long as such Cash Collateral use or ABL DIP Financing meets the following requirements: (i) subject to the Liens arising under the ABL DIP Financing, each Notes Agent is permitted to seek as adequate protection a replacement Lien, for the benefit of the respective Notes Claimholders, on the ABL Priority Collateral, with such replacement Liens to be junior and subordinate in priority to the adequate protection replacement Liens of the ABL Agent and ABL Lenders (with such Lien of the First-Lien Notes Agent being immediately followed in priority by a Lien of the Second-Lien Notes Agent and, thereafter, by a Lien of the Third-Lien Notes Agent), (ii) to the extent that the ABL Agent is granted adequate protection in the form of a Lien on the ABL Priority Collateral arising after the commencement of the Insolvency or Liquidation Proceeding, each Notes Agent is permitted to seek as adequate protection a Lien on the ABL Priority Collateral junior and subordinate in priority to the adequate protection Lien of the ABL Agent and ABL Lenders arising after the commencement of the Insolvency or Liquidation Proceeding (with such Lien of the First-Lien Notes Agent being immediately followed in priority by a Lien of the Second-Lien Notes Agent and, thereafter, by a Lien of the Third-Lien Notes Agent), (iii) to the extent that the ABL Agent is granted adequate protection in the form of an administrative expense claim against any Grantor, each Notes Agent is permitted to seek as adequate protection an administrative expense claim, with such claims to be junior and subordinate in priority to the adequate protection claims of the ABL Agent and ABL Lenders (and with such claims of the First-Lien Notes Agent being immediately followed in priority by a claim of the Second-Lien Notes Agent and, thereafter, by a claim of the Third-Lien Notes Agent), (iv) the terms of the Cash Collateral use or the ABL DIP Financing do not require a Lien on the Notes Priority Collateral (unless such ABL DIP Financing is provided to such Grantor with the consent of the First-Lien Notes Agent), (v) the terms of such ABL DIP Financing or use of Cash Collateral do not require any Grantor to seek approval for any Plan of Reorganization that is inconsistent with this Agreement, and (vi) any superpriority administrative expense claim arising under the ABL DIP Financing against any Grantor shall be pari passu to any superpriority administrative expenses claim arising under the Notes DIP Financing. Each Notes Agent shall be required to subordinate and will subordinate its adequate protection Liens in the ABL Priority Collateral and adequate protection claims in relation thereto to the Liens securing, and claims granted in respect of, such ABL DIP Financing (and all obligations relating thereto, including any “carve-out” granting administrative priority status or Lien priority to secure repayment of fees and expenses of professionals retained by any debtor or creditors’ committee) and if the Liens securing the ABL DIP Financing rank junior and subordinate to the Liens securing the ABL Obligations, each Notes Agent shall be required to subordinate its Liens in the ABL Priority Collateral to the Liens securing such ABL DIP Financing. Except as expressly permitted in Section 6.1(a) and Section 6.3, no Notes Agent will request adequate protection in respect of the ABL Priority Collateral or

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any other relief in connection therewith and the ABL Agent, the ABL Claimholders, each Notes Agent and each Notes Claimholder shall be deemed to consent to the adequate protection expressly permitted in Section 6.1(a) and Section 6.3. Unless the ABL Agent otherwise consents, each Notes Agent on behalf of itself and its respective Notes Claimholders, agrees that no such Person shall provide to such Grantor any ABL DIP Financing to the extent that any Notes Agent or any Notes Claimholder would, in connection with such financing, be granted a Lien on the ABL Priority Collateral.

(b) The ABL Agent, on behalf of the ABL Lenders, the Second-Lien Notes Agent, on behalf of the Second-Lien Noteholders, and the Third-Lien Notes Agent, on behalf of the Third-Lien Noteholders, hereby agree that, until the Discharge of the First-Lien Notes Obligations has occurred, if any Grantor shall be subject to any Insolvency or Liquidation Proceeding and the First-Lien Notes Agent shall desire to permit the use of “Cash Collateral” (as such term is defined in Section 363(a) of the Bankruptcy Code) constituting Notes Priority Collateral or to permit any Grantor to obtain financing, whether from the Notes Claimholders or any other Person under Section 364 of the Bankruptcy Code or any similar Bankruptcy Law secured by a Lien on Notes Priority Collateral and with a superpriority administrative expense claim against such Grantor (collectively, “Notes DIP Financing”), then no ABL Claimholder and no Notes Claimholder will be entitled to raise (and no ABL Claimholder and Notes Claimholder will raise or support any Person in raising), but instead shall be deemed to have hereby irrevocably and absolutely waived, any objection to, and shall not otherwise in any manner be entitled to oppose or will oppose or support any Person in opposing, such Cash Collateral use or Notes DIP Financing (including, except as expressly provided in this Article VI, that the ABL Claimholders and Notes Claimholders are entitled to adequate protection of their interest in the Notes Priority Collateral as a condition thereto) so long as such Cash Collateral use or Notes DIP Financing meets the following requirements: (i) subject to the Liens arising under the Notes DIP Financing, each Notes Agent and the ABL Agent is permitted to seek as adequate protection a replacement Lien, for the benefit of the respective Notes Claimholders and ABL Claimholders, on the Notes Priority Collateral (with such Liens of the First-Lien Notes Agent being junior and subordinate in priority to the Liens granted to secure the Notes DIP Financing and shall be immediately followed in priority by a Lien of the Second-Lien Notes Agent and, thereafter, by a Lien of the Third-Lien Notes Agent and, thereafter by a Lien of the ABL Agent), (ii) to the extent that the First-Lien Notes Agent is granted adequate protection in the form of a Lien on the Notes Priority Collateral arising after the commencement of the Insolvency or Liquidation Proceeding, each other Notes Agent and the ABL Agent is permitted to seek an adequate protection Lien on the Notes Priority Collateral arising after the commencement of the Insolvency or Liquidation Proceeding so long as such adequate protection Lien is junior and subordinate to the Liens securing such Notes DIP Financing and junior and subordinate to the Liens granted to the First-Lien Notes Agent as adequate protection (with such Lien of the Second-Lien Notes Agent being immediately followed in priority by a Lien of the Third-Lien Notes Agent and, thereafter, by a Lien of the ABL Agent), (iii) to the extent that the First-Lien Notes Agent is granted adequate protection in the form of an administrative expense claim against any Grantor, each other Notes Agent and the ABL Agent is permitted to seek as adequate protection an administrative expense claim, with such claims to be junior and subordinate in priority to the adequate protection claims of the First-Lien Note Agent (with such claims of the First-Lien Notes Agent being immediately followed in priority by a claim of the Second-Lien Notes Agent and, thereafter, by a claim of the

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Third-Lien Notes Agent and, thereafter by a claim of the ABL Agent), (iv) the terms of the Cash Collateral use or the Notes DIP Financing do not require a Lien on the ABL Priority Collateral to secure such Notes DIP Financing (unless such Notes DIP Financing is provided to such Grantor with the consent of the ABL Agent), (v) the terms of such Notes DIP Financing or use of Cash Collateral do not require any Grantor to seek approval for any Plan of Reorganization that is inconsistent with this Agreement, and (vi) any superpriority administrative expense claim arising under the Notes DIP Financing against any Grantor shall be pari passu to any superpriority administrative expenses claim arising under any ABL DIP Financing. Each Notes Agent and the ABL Agent shall be required to subordinate and will subordinate its adequate protection Liens in the Notes Priority Collateral and adequate protection claims in relation thereto to the Liens securing, and the claims granted in respect of, such Notes DIP Financing (and all obligations relating thereto, including any “carve-out” granting administrative priority status or Lien priority to secure repayment of fees and expenses of professionals retained by any debtor or creditors’ committee) and if the Liens securing the Notes DIP Financing rank junior and subordinate to the Liens securing the Notes Obligations, each Notes Agent and the ABL Agent shall be required to subordinate its Liens in the Notes Priority Collateral to the Liens securing such Notes DIP Financing. Except as expressly permitted in Section 6.1(b) and Section 6.3, no Notes Agent nor the ABL Agent will request adequate protection in respect of the Notes Priority Collateral or any other relief in connection therewith and each Notes Agent, each Notes Claimholder, the ABL Agent and the ABL Claimholders shall be deemed to consent to the adequate protection expressly permitted in Section 6.1(b) and Section 6.3. Notwithstanding the foregoing, the Second-Lien Notes Agent shall have the right to object to any Notes DIP Financing solely to the extent such Notes DIP Financing’s milestones, covenants or events of default expressly dictate any plan or reorganization for, or liquidation of, any Grantor in a manner that is materially adverse to the Second-Lien Notes Claimholders. Unless the First-Lien Notes Agent otherwise consents, each other Notes Agent on behalf of itself and its respective Notes Claimholders and the ABL Agent on behalf of itself and the ABL Claimholders, agrees that no such Person shall provide to any Grantor any Notes DIP Financing to the extent that any other Notes Agent, any other Notes Claimholder (other than a First-Lien Notes Claimholder), the ABL Agent or any ABL Claimholder would, in connection with such financing, be granted a Lien on the Notes Priority Collateral.

6.2. Relief from the Automatic Stay.

(a) Until the Discharge of ABL Obligations has occurred, each Notes Agent, and the other Notes Claimholders, agree that none of them shall seek (or support any other Person seeking) relief from the automatic stay or any other stay in any Insolvency or Liquidation Proceeding in respect of the ABL Priority Collateral, without the prior written consent of the ABL Agent (given or not given in its sole and absolute discretion), unless (i) the ABL Agent already has filed a motion (which remains pending) for such relief with respect to its interest in such ABL Priority Collateral and (ii) a corresponding motion, in the reasonable judgment of any applicable Notes Agent, must be filed for the purpose of preserving such Notes Agent’s ability to receive residual distributions pursuant to Section 4.1, although the Notes Claimholders shall otherwise remain subject to the restrictions in Section 3.1 following the granting of any such relief from the automatic stay.

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(b) Until the Discharge of First-Lien Notes Obligations has occurred, the Second-Lien Notes Agent on behalf of its respective Notes Claimholders, the Third-Lien Notes Agent on behalf of its respective Notes Claimholders, and the ABL Agent on behalf of the ABL Claimholders agrees that none of them shall seek (or support any other Person seeking) relief from the automatic stay or any other stay in any Insolvency or Liquidation Proceeding in respect of the Notes Priority Collateral (other than to the extent such relief is required to exercise its rights under Section 3.3), without the prior written consent of the First-Lien Notes Agent (given or not given as directed under the First-Lien Indenture), unless (i) the First-Lien Notes Agent already has filed a motion (which remains pending) for such relief with respect to its interest in the Notes Priority Collateral and (ii) a corresponding motion, in the reasonable judgment of the ABL Agent or other Notes Agent as applicable, must be filed for the purpose of preserving the ABL Agent’s or such other Notes Agent’s respective ability to receive residual distributions pursuant to Section 4.1, although the ABL Claimholders and other Notes Agents shall otherwise remain subject to the restrictions in Section 3.2 following the granting of any such relief from the automatic stay.

6.3. Adequate Protection.

(a) Nothing herein shall limit the rights of the ABL Agent or the ABL Claimholders from seeking adequate protection with respect to their rights in the ABL Priority Collateral in any Insolvency or Liquidation Proceeding (including adequate protection in the form of a cash payment, periodic cash payments or otherwise) so long as such request is not otherwise inconsistent with this Agreement. Neither any Notes Agent, on behalf of itself and its respective Notes Claimholders, nor any Notes Claimholder, shall be entitled to contest and none of them shall contest (or support any other Person contesting) (but instead shall be deemed to have hereby irrevocably, absolutely, and unconditionally waived any right in respect of):

(i) any request by the ABL Agent or the other ABL Claimholders for relief from the automatic stay with respect to the ABL Priority Collateral; or

(ii) any request by the ABL Agent or the other ABL Claimholders for adequate protection with respect to the ABL Priority Collateral (except to the extent that any such adequate protection is a payment from Notes Priority Collateral); or

(iii) any objection by the ABL Agent or the other ABL Claimholders to any motion, relief, action or proceeding based on the ABL Agent or the other ABL Claimholders claiming a lack of adequate protection with respect to the ABL Priority Collateral.

(b) Nothing herein shall limit the rights of the First-Lien Notes Agent on behalf of itself and on behalf of the Notes Claimholders from seeking adequate protection with respect to their rights in the Notes Priority Collateral in any Insolvency or Liquidation Proceeding (including adequate protection in the form of a cash payment, periodic cash payments or otherwise) so long as such request is not otherwise inconsistent with this Agreement. Neither the Second-Lien Notes Agent on behalf of itself and its respective Notes Claimholders, nor the Third-Lien Notes Agent on behalf of itself and its respective Notes Claimholders, nor any of their respective Notes Claimholders, nor the ABL Agent, on behalf of itself and the ABL

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Claimholders, nor any ABL Claimholder shall be entitled to contest and none of them shall contest (or support any other Person contesting) (but instead shall be deemed to have hereby irrevocably, absolutely, and unconditionally waived any right in respect of):

(i) any request by the First-Lien Notes Agent or the other First-Lien Notes Claimholders for relief from the automatic stay with respect to the Notes Priority Collateral; or

(ii) any request by the First-Lien Notes Agent or the First-Lien Notes Claimholders for adequate protection (including adequate protection in the form of a cash payment, periodic cash payments or otherwise) and with respect to the Notes Priority Collateral (except to the extent that any such adequate protection is a payment from ABL Priority Collateral); or

(iii) any objection by the First-Lien Notes Agent or the First-Lien Notes Claimholders to any motion, relief, action or proceeding based on the First-Lien Notes Agent or the First-Lien Notes Claimholders claiming a lack of adequate protection with respect to the Notes Priority Collateral.

(c) Consistent with the foregoing provisions in this Section 6.3, and except as provided in Sections 6.1 and 6.7, in any Insolvency or Liquidation Proceeding:

(i) no Notes Claimholder shall be entitled (and each Notes Claimholder shall be deemed to have hereby irrevocably, absolutely, and unconditionally waived any right) to seek or otherwise be granted any type of adequate protection with respect to its interests in the ABL Priority Collateral (except as expressly set forth in Section 6.1 or as may otherwise be consented to in writing by the ABL Agent in its sole and absolute discretion); provided, however, subject to Section 6.1, Notes Claimholders may seek and obtain adequate protection in the form of an additional or replacement Lien on Collateral so long as (A) the ABL Claimholders have been granted adequate protection in the form of a replacement lien on such Collateral, (B) any such Lien on ABL Priority Collateral (and on any Collateral granted as adequate protection for the ABL Claimholders in respect of their interest in such ABL Priority Collateral) is subordinated to the Liens of the ABL Agent in such Collateral on the same basis and with the same relative priority as the other Liens of any Notes Agent on ABL Priority Collateral, and (C) the Second-Lien Claimholders may seek adequate protection only if the First-Lien Claimholders shall have obtained adequate protection, and the Third-Lien Claimholders may seek adequate protection only if the Second-Lien Claimholders shall have obtained adequate protection; and

(ii) none of the Second-Lien Notes Claimholders, nor Third-Lien Notes Claimholders, nor ABL Claimholders shall be entitled (and each of them shall be deemed to have hereby irrevocably, absolutely, and unconditionally waived any right) to seek or otherwise be granted any type of adequate protection in respect of Notes Priority Collateral except as expressly permitted by Section 6.1(b) or as otherwise may be consented to in writing by the First-Lien Notes Agent as directed under the First-Lien Indenture; provided, however, the Second-Lien Notes Agent shall be permitted to request

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additional adequate protection (including adequate protection in the form of a cash payment, periodic cash payments or otherwise) with respect to the Notes Priority Collateral on behalf of itself and the Second Lien Notes Claimholders (x) so long as such request is not otherwise inconsistent with this Agreement, (y) subject to the right of the First-Lien Notes Agent and the First-Lien Notes Claimholders to object on any basis (including that the Second-Lien Notes Agent and the Second Lien Notes Claimholder are undersecured) and (z) only to the extent such adequate protection being requested was previously granted to the First-Lien Notes Agent, for itself and for the benefit of the First-Lien Notes Claimholders; provided, further, however, Second-Lien Notes Claimholders, Third-Lien Notes Claimholders and ABL Claimholders may seek and obtain adequate protection in respect of Notes Priority Collateral in the form of an additional or replacement Lien on Collateral so long as (A) the First-Lien Notes Claimholders have been granted adequate protection in the form of a replacement lien on such Collateral, (B) any such Lien on Notes Priority Collateral (and on any Collateral granted as adequate protection for the First-Lien Notes Claimholders in respect of their interest in such Notes Priority Collateral) is subordinated to the Liens of the First-Lien Notes Agent in such Collateral on the same basis and with the same relative priority respectively as the other Liens of the Second-Lien Notes Agent, the Third-Lien Notes Agent and the ABL Agent on Notes Priority Collateral, and (C) only if the Notes Claimholder having the Higher Priority Obligation immediately senior to the Claimholder seeking adequate protection shall have obtained such adequate protection.

6.4. Avoidance Issues. If any ABL Claimholder or Notes Claimholder is required in any Insolvency or Liquidation Proceeding or otherwise to turn over or otherwise pay to the estate of the applicable Grantor any amount paid in respect of ABL Obligations or their respective Notes Obligations, as applicable (a “Recovery”), then such ABL Claimholders or respective Notes Claimholders shall be entitled to a reinstatement of ABL Obligations or their respective Notes Obligations, as applicable, with respect to all such recovered amounts. If this Agreement shall have been terminated prior to such Recovery, this Agreement shall be reinstated in full force and effect, and such prior termination shall not diminish, release, discharge, impair or otherwise affect the obligations of the parties hereto from such date of reinstatement.

6.5. Reorganization Securities. Subject to the ability of the ABL Claimholders and respective Notes Claimholders, as applicable, to support or oppose confirmation or approval of any Plan of Reorganization or to oppose confirmation or approval of any Plan of Reorganization, as provided in this Agreement, if, in any Insolvency or Liquidation Proceeding, debt obligations of the reorganized debtor secured by Liens upon any property of the reorganized debtor are distributed pursuant to a Plan of Reorganization, both on account of ABL Obligations and on account of any respective Notes Obligations, then, to the extent the debt obligations distributed on account of the ABL Obligations and on account of such respective Notes Obligations are secured by Liens upon the same property, the provisions of this Agreement will survive the distribution of such debt obligations pursuant to such plan and will apply with like effect to the debt obligations so distributed, to the Liens securing such debt obligations and the distribution of Proceeds thereof.

6.6. Post-Petition Interest. Neither any Notes Agent nor any Notes Claimholder shall oppose or seek to challenge any claim by the ABL Agent or any ABL Claimholder for allowance in any Insolvency or Liquidation Proceeding of ABL Obligations

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consisting of post-petition interest, fees or expenses to the extent of the value of the Lien on the ABL Priority Collateral securing any ABL Claimholder’s claim, without regard to the existence of the Lien of any Notes Agent on behalf of its respective Notes Claimholders on the ABL Priority Collateral. None of the ABL Agent, any ABL Claimholder, the Second-Lien Notes Agent and any Second-Lien Notes Claimholder, the Third-Lien Notes Agent and any Third-Lien Notes Claimholder shall oppose or seek to challenge any claim by the First-Lien Notes Agent or any First-Lien Notes Claimholder for allowance in any Insolvency or Liquidation Proceeding of Notes Obligations consisting of post-petition interest, fees or expenses to the extent of the value of the Lien on the Notes Priority Collateral securing any First-Lien Notes Claimholder’s claim, without regard to the existence of the Lien of the ABL Agent on behalf of the ABL Claimholders with respect to the ABL Priority Collateral or the Notes Priority Collateral and the Second-Lien Agent or Third-Lien Agent on behalf of their respective Notes Claimholders with respect to the Notes Priority Collateral.

6.7. Separate Grants of Security and Separate Classification. Each Notes Agent, on behalf of its respective Notes Claimholders, and the ABL Agent on behalf of the ABL Claimholders, acknowledge and intend that: the respective grants of Liens pursuant to the ABL Security Documents and the respective Notes Security Documents constitute four separate and distinct grants of Liens, and because of, among other things, their differing rights in the Collateral, each class of Notes Obligations are fundamentally different from the ABL Obligations and must be separately classified in any Plan of Reorganization proposed or confirmed (or approved) in an Insolvency or Liquidation Proceeding. To further effectuate the intent of the parties as provided in the immediately preceding sentence, if it is held that the claims of the ABL Claimholders and any Notes Claimholders in respect of the Collateral constitute claims in the same class (rather than separate classes of senior and junior secured claims), then the ABL Claimholders and the Notes Claimholders hereby acknowledge and agree that all distributions shall be made as if there were separate classes of ABL Obligations and Notes Obligations against the Grantors (with the effect being that, to the extent that the aggregate value of the ABL Priority Collateral or Notes Priority Collateral is sufficient (for this purpose ignoring all claims held by the other Secured Parties for whom such Collateral is non-priority or lower priority in accordance with Section 2.1 and Section 2.2), the ABL Claimholders or the First-Lien Notes Claimholders, respectively, shall be entitled to receive, in addition to amounts distributed to them in respect of principal, pre-petition interest and other claims, all amounts owing in respect of post-petition interest, fees or expenses that is available from each pool of priority Collateral for each of the ABL Claimholders and the Notes Claimholders, respectively, before any distribution is made in respect of the claims held by the other Secured Parties for whom such Collateral is non-priority or lower priority, with such other Secured Parties hereby acknowledging and agreeing to turn over to the respective other Secured Parties amounts otherwise received or receivable by them to the extent necessary to effectuate the intent of this sentence, even if such turnover has the effect of reducing the aggregate recoveries.

6.8. Asset Dispositions in an Insolvency or Liquidation Proceeding.

(a) Without limiting the ABL Agent’s and the other ABL Claimholders’ rights under Section 3.1(b), none of the Notes Agent nor any other Notes Claimholder shall, in any Insolvency or Liquidation Proceeding or otherwise, oppose any sale or disposition of any ABL Priority Collateral that is supported by the ABL Claimholders, and each Notes Agent and each other Notes Claimholder will be deemed to have irrevocably, absolutely, and unconditionally

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consented under Section 363 of the Bankruptcy Code (and otherwise) to any sale of any ABL Priority Collateral supported by the ABL Claimholders and to have released their Liens on such assets; provided that to the extent the Proceeds of such Collateral are not applied to reduce ABL Obligations, each Notes Agent shall retain a Lien on such Proceeds in accordance with the terms of (and having the relative priority set forth in) this Agreement.

(b) Without limiting the First-Lien Notes Agent’s and the other First-Lien Notes Claimholders’ rights under Section 3.2(b), none of the other Notes Agents nor any other of their respective Notes Claimholders nor the ABL Agent nor any other ABL Claimholder shall, in any Insolvency or Liquidation Proceeding or otherwise, oppose any sale or disposition of any Notes Priority Collateral that is supported by the First-Lien Notes Claimholders and made subject to Section 3.3(d), and the Second-Lien Notes Agent, each other Second-Lien Notes Claimholder, the Third-Lien Notes Agent, each other Third-Lien Notes Claimholder, the ABL Agent and each other ABL Claimholder will be deemed to have consented under Section 363 of the Bankruptcy Code (and otherwise) to any sale of any Notes Priority Collateral supported by the First-Lien Notes Claimholders and to have released their Liens on such assets; provided that to the extent the Proceeds of such Collateral are not applied to reduce First-Lien Notes Obligations, each other Notes Agent and the ABL Agent shall retain a Lien on such Proceeds in accordance with the terms of, and having the relative priority set forth in, this Agreement; provided, further, that the Second-Lien Notes Agent shall have the right to raise, in any sale or disposition of any Notes Priority Collateral under this Section 6.8(b), any objection or opposition available to it solely as an unsecured creditor (and not based on its status as a secured creditor or otherwise in contradiction to this Agreement).

6.9. Certain Agreements with Respect to Unenforceable Liens. Notwithstanding anything to the contrary contained herein, if in any Insolvency or Liquidation Proceeding a determination is made that any first priority Lien encumbering any Collateral is not enforceable for any reason then the Agents and Claimholders having Liens of lower ranking priority as provided in this Agreement agree that any distribution or recovery they may receive with respect to, or allocable to, the value of the assets constituting Collateral subject to an enforceable Lien in favor of any such lower ranking priority Lien holder or any proceeds thereof shall (for so long as the Discharge of Obligations relating to the applicable first priority Lien has not occurred) be segregated and held in trust and forthwith paid over to the ABL Agent for the benefit of the ABL Claimholders or to the First-Lien Notes Agent for the benefit of the First-Lien Notes Claimholders, as applicable based on whichever holds or is intended to hold the first priority Lien as provided in Section 2.1, in the same form as received without recourse, representation or warranty (other than a representation of the Agent (required to so segregate and pay over) that it has not otherwise sold, assigned, transferred or pledged any right, title or interest in and to such distribution or recovery) but with any necessary endorsements or as a court of competent jurisdiction may otherwise direct.

VII. RELIANCE; WAIVERS; ETC.

7.1. Reliance. Other than any reliance on the terms of this Agreement, each of the ABL Claimholders represents and warrants that it has, independently and without reliance on any Notes Agent or any Notes Claimholder, and based on documents and information deemed by it appropriate, made its own credit analysis and decision to enter into ABL Loan Documents and be

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bound by the terms of this Agreement, and it will continue to make its own credit decision in taking or not taking any action under the ABL Loan Documents or this Agreement. Other than any reliance on the terms of this Agreement, each of the Notes Claimholders represents and warrants that it has, independently and without reliance on any other Notes Claimholder, the ABL Agent, any other ABL Claimholder, and based on documents and information deemed by it appropriate, made its own credit analysis and decision to enter into each of the Notes Documents and be bound by the terms of this Agreement, and it will continue to make its own credit decision in taking or not taking any action under the Notes Documents or this Agreement. Each Notes Agent and the ABL Agent represents and warrants to the other parties hereto that it is authorized and/or directed under its respective Indenture and the ABL Credit Agreement, as the case may be, to enter into this Agreement.

7.2. No Warranties or Liability. The ABL Agent, on behalf of the ABL Claimholders, acknowledges and agrees that each of the Notes Agents and the Notes Claimholders have made no express or implied representation or warranty, including with respect to the execution, validity, legality, completeness, collectibility or enforceability of any of the other Notes Documents, the ownership of any Collateral or the perfection or priority of any Liens thereon. Except as otherwise provided in this Agreement, the respective Notes Claimholders will be entitled to manage and supervise their respective Note holdings and extensions of credit under the respective Notes Documents in accordance with law and as they may otherwise, in their sole discretion, deem appropriate. Each Notes Agent, on behalf its respective Notes Claimholders, acknowledges and agrees that the ABL Agent and the other ABL Claimholders have made no express or implied representation or warranty, including with respect to the execution, validity, legality, completeness, collectibility or enforceability of any of the other ABL Loan Documents, the ownership of any Collateral or the perfection or priority of any Liens thereon. Except as otherwise provided herein, the ABL Agent and the other ABL Claimholders will be entitled to manage and supervise their respective loans and extensions of credit under their respective ABL Loan Documents in accordance with law and as they may otherwise, in their sole discretion, deem appropriate. Each Notes Agent and its respective Notes Claimholders shall have no duty to the ABL Agent or any of the ABL Claimholders, and the ABL Agent and the other ABL Claimholders shall have no duty to any Notes Agent or any of the other Notes Claimholders, to act or refrain from acting in a manner which allows, or results in, the occurrence or continuance of an event of default or default under any agreements any Grantor (including the ABL Loan Documents and the Notes Documents), regardless of any knowledge thereof which they may have or be charged with.

7.3. No Waiver of Lien Priorities.

(a) No right of the Agents, the other ABL Claimholders or the other Notes Claimholders to enforce any provision of this Agreement or any ABL Loan Document or Notes Document shall at any time in any way be prejudiced or impaired by any act or failure to act on the part of any Grantor or by any act or failure to act by such Agents, ABL Claimholder or Notes Claimholders or by any noncompliance by any Person with the terms, provisions and covenants of this Agreement, any of the ABL Loan Documents or any of the Notes Documents, regardless of any knowledge thereof which the Agents or the ABL Claimholders or Notes Claimholders, or any of them, may have or be otherwise charged with.

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(b) Without in any way limiting the generality of the foregoing paragraph (but subject to the rights of the Grantors under the ABL Loan Documents and Notes Documents and subject to the provisions of Sections 5.3(a), 5.3(d), and, as applicable, 5.3(e)), the Agents, the other ABL Claimholders and the other Notes Claimholders may, at any time and from time to time in accordance with the ABL Loan Documents and Notes Documents and/or applicable law, without the consent of, or notice to, the other Agents or the ABL Claimholders or the Notes Claimholders (as applicable), without incurring any liabilities to such Persons and without impairing or releasing the Lien priorities and other benefits provided in this Agreement (even if any right of subrogation or other right or remedy is affected, impaired or extinguished thereby) do any one or more of the following:

(i) change the manner, place or terms of payment or change or extend the time of payment of, or amend, renew, exchange, increase or alter, the terms of any of the Obligations or any Lien or guaranty thereof or any liability of any Grantor, or any liability incurred directly or indirectly in respect thereof (including any increase in or extension of the Obligations, without any restriction as to the tenor or terms of any such increase or extension) or otherwise amend, renew, exchange, extend, modify or supplement in any manner any Liens held by the Agents or any rights or remedies under any of the ABL Loan Documents or the Notes Documents;

(ii) sell, exchange, release, surrender, realize upon, enforce or otherwise deal with in any manner and in any order any part of the Collateral (except to the extent provided in this Agreement) or any liability of any Grantor or any liability incurred directly or indirectly in respect thereof;

(iii) settle or compromise any Obligation or any other liability of any Grantor or any security therefor or any liability incurred directly or indirectly in respect thereof and apply any sums by whomsoever paid and however realized to any liability in any manner or order that is not inconsistent with the terms of this Agreement; and

(iv) exercise or delay in or refrain from exercising any right or remedy against any security or any Grantor or any other Person, elect any remedy and otherwise deal freely with any Grantor.

7.4. Obligations Unconditional. All rights, interests, agreements and obligations of the ABL Claimholders and the Notes Claimholders, respectively, hereunder shall remain in full force and effect irrespective of:

(a) any lack of validity or enforceability of any ABL Loan Documents or any Notes Documents;

(b) except, in each case, as otherwise expressly set forth in this Agreement, any change in the time, manner or place of payment of, or in any other terms of, all or any of the ABL Obligations or Notes Obligations, or any amendment or waiver or other modification, including any increase in the amount thereof, whether by course of conduct or otherwise, of the terms of any ABL Loan Document or any Notes Document;

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(c) except as otherwise expressly set forth in this Agreement, any exchange, release, voiding, avoidance or non-perfection of any security interest in any Collateral or any other collateral, or any amendment, waiver or other modification, whether in writing or by course of conduct or otherwise, of all or any of the ABL Obligations or Notes Obligations or any guaranty thereof;

(d) the commencement of any Insolvency or Liquidation Proceeding in respect of any Grantor; or

(e) any other circumstances which otherwise might constitute a defense available to, or a discharge of, any Grantor in respect of the ABL Agent, the ABL Obligations, any ABL Claimholder, any Notes Agent, any Notes Obligations or any Notes Claimholder in respect of this Agreement.

VIII. MISCELLANEOUS.

8.1. Conflicts. In the event of any conflict between the provisions of this Agreement and the provisions of any ABL Loan Document or any Notes Document, the provisions of this Agreement shall govern and control.

8.2. Effectiveness; Continuing Nature of this Agreement; Severability. This Agreement shall become effective when executed and delivered by the parties hereto. This is a continuing agreement of Lien subordination (as opposed to an agreement of debt or claim subordination), and the ABL Claimholders and the respective Notes Claimholders may continue, at any time and without notice to the other Agents, to extend credit and other financial accommodations and lend monies to or for the benefit of any Grantor in reliance hereon. Each of the Agents, on behalf of the ABL Claimholders or the respective Notes Claimholders, as applicable, hereby irrevocably, absolutely, and unconditionally waives any right any Claimholder may have under applicable law to revoke this Agreement or any of the provisions of this Agreement. The terms of this Agreement shall survive, and shall continue in full force and effect, in any Insolvency or Liquidation Proceeding. Consistent with, but not in limitation of, the preceding sentence, each of the Agents, on behalf of the ABL Claimholders and the respective Notes Claimholders, as applicable, irrevocably acknowledges that this Agreement constitutes a “subordination agreement” within the meaning of both New York law and Section 510(a) of the Bankruptcy Code. Any provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall not invalidate the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. All references to any Grantor shall include such Grantor as debtor and debtor-in-possession and any receiver or trustee for any Grantor (as applicable) in any Insolvency or Liquidation Proceeding. This Agreement shall terminate and be of no further force and effect:

(a) with respect to the ABL Agent, the ABL Claimholders and the ABL Obligations, on the date of the Discharge of ABL Obligations, subject to the rights of the ABL Claimholders under Section 6.4;

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(b) with respect to the First-Lien Notes Agent, the First-Lien Notes Claimholders and the First-Lien Notes Obligations, on the date of the Discharge of First-Lien Notes Obligations, subject to the rights of the Notes Claimholders under Section 6.4;

(c) with respect to the Second-Lien Notes Agent, the Second-Lien Notes Claimholders and the Second-Lien Notes Obligations, on the date of the Discharge of Second-Lien Notes Obligations, subject to the rights of the Notes Claimholders under Section 6.4; and

(d) with respect to the Third-Lien Notes Agent, the Third-Lien Notes Claimholders and the Third-Lien Notes Obligations, on the date of the Discharge of Third-Lien Notes Obligations, subject to the rights of the Notes Claimholders under Section 6.4.

8.3. Amendments; Waivers. No amendment, modification or waiver of any of the provisions of this Agreement by any Notes Agent or the ABL Agent shall be deemed to be made unless the same shall be in writing signed on behalf of each party hereto or its authorized agent and each waiver, if any, shall be a waiver only with respect to the specific instance involved and shall in no way impair the rights of the parties making such waiver or the obligations of the other parties to such party in any other respect or at any other time. Notwithstanding the foregoing, (i) no Grantor shall have any right to consent to or approve any amendment, modification or waiver of any provision of this Agreement except to the extent its rights are directly affected and (ii) any Additional Pari Passu Notes Agent, on behalf of itself and the applicable holder of Additional Pari Passu Notes Obligations, may become a party to this Agreement, without any further action by any other party hereto, upon execution and delivery by the Company and such Agent of a properly completed joinder to this Agreement.

8.4. Information Concerning Financial Condition of the Parent, the Company and Their Subsidiaries. The ABL Claimholders, on the one hand, and the Notes Claimholders, on the other hand, shall each be responsible for keeping themselves informed of (a) the financial condition of the Company and the Company’s Subsidiaries and all endorsers and/or guarantors and other Grantors of the ABL Obligations or the Notes Obligations and (b) all other circumstances bearing upon the risk of nonpayment of the ABL Obligations or the Notes Obligations. None of the ABL Claimholders nor any of the Notes Claimholders shall have any duty to advise the others of information known to it or them regarding such condition or any such circumstances or otherwise. In the event that the ABL Agent or any of the other ABL Claimholders or any Notes Agent or any of the other Notes Claimholders undertakes at any time or from time to time to provide any such information to any of the others, it or they shall be under no obligation, (i) to make, and shall not make, any express or implied representation or warranty, including with respect to the accuracy, completeness, truthfulness or validity of any such information so provided, (ii) to provide any additional information or to provide any such information on any subsequent occasion, (iii) to undertake any investigation, or (iv) to disclose any information, which pursuant to accepted or reasonable commercial finance practices, such party wishes to maintain confidential or is otherwise required to maintain confidential.

8.5. Subrogation.

(a) With respect to the value of any payments or distributions in cash, property or other assets that any of the Notes Claimholders actually pays over to the ABL Agent or the ABL

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Claimholders under the terms of this Agreement as a result of its first priority Lien on the ABL Priority Collateral, the Notes Claimholders shall be subrogated to the rights of the ABL Claimholders; provided, however, that each Notes Agent, on behalf of the Notes Claimholders, hereby agrees not to assert or enforce all such rights of subrogation it may acquire as a result of any payment hereunder until the Discharge of ABL Obligations has occurred. The Grantors acknowledge and agree that, to the extent permitted by applicable law, the value of any payments or distributions in cash, property or other assets received by the Notes Claimholders that are paid over to the ABL Claimholders pursuant to this Agreement shall not reduce any of the Notes Obligations. Notwithstanding the foregoing provisions of this Section 8.5(a), none of the Notes Claimholders shall have any claim against any of the ABL Claimholders for any impairment of any subrogation rights herein granted to the Notes Claimholders.

(b) With respect to the value of any payments or distributions in cash, property or other assets that any of the Notes Claimholders or the ABL Claimholders actually pays over to the First-Lien Notes Claimholders under the terms of this Agreement as a result of its first priority Lien on the Notes Priority Collateral, the ABL Claimholders and such paying Notes Claimholders shall be subrogated to the rights of the First-Lien Notes Claimholders; provided, however, that each of the ABL Agent, on behalf of the ABL Claimholders, the Second-Lien Notes Agent on behalf of the Second-Lien Notes Claimholders and the Third-Lien Notes Agent on behalf of the Third-Lien Notes Claimholders, hereby agrees not to assert or enforce all such rights of subrogation it may acquire as a result of any payment hereunder until the Discharge of First-Lien Notes Obligations has occurred. The Grantors acknowledge and agree that, to the extent permitted by applicable law, the value of any payments or distributions in cash, property or other assets received by the ABL Claimholders or Notes Claimholders that are paid over to the First-Lien Notes Claimholders pursuant to this Agreement shall not reduce any of the ABL Obligations, Second-Lien Notes Obligations or Third-Lien Notes Obligations. Notwithstanding the foregoing provisions of this Section 8.5(b), none of the Second-Lien Notes Claimholders, the Third-Lien Notes Claimholders nor the ABL Claimholders shall have any claim against any of the First-Lien Notes Claimholders for any impairment of any subrogation rights herein granted to the ABL Claimholders, Second-Lien Notes Claimholders or Third-Lien Notes Claimholders.

8.6. SUBMISSION TO JURISDICTION; WAIVERS.

(a) ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST ANY PERSON ARISING OUT OF OR RELATING HERETO MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT JURISDICTION IN THE STATE, COUNTY AND CITY OF NEW YORK. BY EXECUTING AND DELIVERING THIS AGREEMENT, EACH PARTY, FOR ITSELF AND ON BEHALF OF ITS RESPECTIVE NOTES CLAIMHOLDERS (IN THE CASE OF EACH NOTES AGENT) AND THE ABL CLAIMHOLDERS (IN THE CASE OF THE ABL AGENT), IRREVOCABLY:

(1) AGREES THAT THE ONLY NECESSARY PARTIES TO ANY AND ALL JUDICIAL PROCEEDINGS ARISING OUT OF OR RELATING TO THIS AGREEMENT SHALL BE THE PARTIES HERETO, EXCEPT WHERE IN ANY SUCH JUDICIAL PROCEEDING RELIEF (INCLUDING INJUNCTIVE RELIEF OR THE RECOVERY OF MONEY) IS BEING SOUGHT DIRECTLY AGAINST OR FROM A PERSON THAT IS NOT A PARTY AND EXCEPT THAT, IN ANY SUCH JUDICIAL PROCEEDINGS BETWEEN

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ANY NOTES AGENT AND THE ABL AGENT THAT DOES NOT SEEK ANY RELIEF AGAINST OR FROM THE COMPANY, THE PARENT OR ANY OF THE PARENT’S SUBSIDIARIES, THE COMPANY, THE PARENT AND THE SUBSIDIARIES SHALL NOT BE NECESSARY PARTIES. WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, AND CONSISTENT WITH THE PROVISIONS OF SECTIONS 8.14 AND 8.17, NONE OF THE ABL CLAIMHOLDERS (OTHER THAN THE ABL AGENT) OR THE NOTES CLAIMHOLDERS (OTHER THAN THE RESPECTIVE NOTES AGENTS) SHALL BE NECESSARY OR OTHERWISE APPROPRIATE PARTIES TO ANY SUCH JUDICIAL PROCEEDINGS, UNLESS IN SUCH JUDICIAL PROCEEDING SUMS ARE BEING SOUGHT TO BE RECOVERED DIRECTLY FROM SUCH PERSONS, INCLUDING PURSUANT TO SECTION 4.2.

(2) ACCEPTS GENERALLY AND UNCONDITIONALLY THE NONEXCLUSIVE JURISDICTION AND VENUE OF SUCH COURTS;

(3) WAIVES ANY DEFENSE OF FORUM NON CONVENIENS;

(4) AGREES THAT SERVICE OF ALL PROCESS IN ANY SUCH PROCEEDING IN ANY SUCH COURT MAY BE MADE BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO THE APPLICABLE PERSON (AND IN THE CASE OF A PARTY, AT ITS ADDRESS PROVIDED IN ACCORDANCE WITH SECTION 8.7); AND

(5) AGREES THAT SERVICE AS PROVIDED IN CLAUSE (4) ABOVE IS SUFFICIENT TO CONFER PERSONAL JURISDICTION OVER THE APPLICABLE PERSON IN ANY SUCH PROCEEDING IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT.

(6) WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT, ANY OF THE ABL LOAN DOCUMENTS OR ANY OF THE NOTE DOCUMENTS. EACH OF THE PARTIES HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT, THE ABL LOAN DOCUMENTS AND THE NOTE DOCUMENTS, AS APPLICABLE, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 8.6.

8.7. Notices. All notices permitted or required under this Agreement need be sent only to the respective Notes Agents and the ABL Agent, as applicable, in order to be effective and otherwise binding on any applicable Claimholder. If any notice is sent for whatever reason to the other Notes Claimholders or the ABL Claimholders, such notice shall also be sent to the applicable Agent. Unless otherwise specifically provided herein, any notice hereunder shall be in writing and may be personally served or sent by facsimile or United States mail or courier service

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and shall be deemed to have been given when delivered in person or by overnight courier service and signed for against receipt thereof, upon receipt of facsimile during normal business hours, or three Business Days after depositing it in the United States certified mails (return receipt requested) with postage prepaid and properly addressed. For the purposes hereof, the addresses of the parties hereto shall be as set forth below each party’s name on the signature pages hereto, or, as to each party, at such other address as may be designated by such party in a written notice to all of the other parties.

8.8. Further Assurances. The ABL Agent, on behalf of the ABL Claimholders, and each Notes Agent, on behalf of its respective Notes Claimholders, and the Grantors, agree that each of them shall take such further action and shall execute and deliver such additional documents and instruments (in recordable form, if requested) as the ABL Agent or the respective Notes Agent may reasonably request to effectuate the terms of and the Lien priorities contemplated by this Agreement. If any Subsidiary of the Company shall become a Grantor after the date of this Agreement, such Grantor shall deliver a counterpart of this Agreement duly executed by such Grantor to the Agents whereupon such Subsidiary shall become a party hereto without any further action by any other party hereto (it being understood that any failure by a Grantor to deliver a counterpart to this Agreement shall not affect the relative rights and obligations of the ABL Claimholders and Notes Claimholders to the Collateral of such Grantor).

8.9. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

8.10. Specific Performance. Each Agent may demand specific performance of this Agreement. The ABL Agent, on behalf of itself and the ABL Claimholders, and each Notes Agent, on behalf of itself and its respective Notes Claimholders, hereby irrevocably waive any defense based on the adequacy of a remedy at law and any other defense which might be asserted to bar the remedy of specific performance in any action which may be brought by the ABL Agent or the other ABL Claimholders or any Notes Agent or any other Notes Claimholders, as applicable. Without limiting the generality of the foregoing or of the other provisions of this Agreement, in seeking specific performance in any Insolvency or Liquidation Proceeding, an Agent may seek such relief as if it were the “holder” of the claims of its own Claimholders under Section 1126(a) of the Bankruptcy Code or otherwise had been granted an irrevocable power of attorney by its Claimholders.

8.11. Headings. Section headings in this Agreement are included herein for convenience of reference only and shall not constitute a part of this Agreement for any other purpose or be given any substantive effect.

8.12. Counterparts. 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. Delivery of an executed counterpart of a signature page of this Agreement or any document or instrument delivered in connection herewith by telecopy shall be effective as delivery of a manually executed counterpart of this Agreement or such other document or instrument, as applicable.

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8.13. Authorization. By its signature, each party hereto represents and warrants to the other parties hereto that the individual signing this Agreement on its behalf is duly authorized to execute this Agreement. Each Notes Agent hereby represents that it is authorized to, and by its signature hereon does, bind the other Notes Claimholders for which such Notes Agent acts to the terms of this Agreement. The ABL Agent hereby represents that it is authorized to, and by its signature hereon does, bind the other ABL Claimholders to the terms of this Agreement.

8.14. No Third Party Beneficiaries. This Agreement and the rights and benefits hereof shall inure to the benefit of each of the parties hereto and its respective successors and assigns and shall inure to the benefit of (and shall be binding upon) each of the Agents, the other ABL Claimholders, the other Notes Claimholders and their respective successors and assigns. Without limiting the generality of the foregoing, each of the Indentures, each Additional Pari Passu Notes Agreement and the ABL Credit Agreement shall expressly refer to this Agreement and acknowledge that its provisions shall be binding on the Notes Agent, and the other Notes Claimholders (and their respective successors and assigns) and on the ABL Agent and the other ABL Claimholders (and their respective successors and assigns), as applicable, and, in any event, this Agreement shall be binding on the Agents, the other ABL Claimholders, and the other Notes Claimholders and the Grantors and their respective successors and assigns as if its provisions were set forth in their entirety in the ABL Credit Agreement, the Indentures and each Additional Pari Passu Notes Agreement.

8.15. Provisions Solely to Define Relative Rights. The provisions of this Agreement are and are intended solely for the purpose of defining the relative rights among themselves of the ABL Claimholders and each of the Notes Claimholders. No Grantor or any other creditor thereof shall have any rights hereunder, and no Grantor may rely on the terms hereof. Nothing in this Agreement is intended to or shall impair as between the Grantors and the ABL Agent and the other ABL Claimholders, or as between the Grantors and any Notes Agent and the other respective Notes Claimholders, the obligations of any Grantor, which are absolute and unconditional, to pay principal, interest, fees and other amounts as provided in the other ABL Loan Documents and the other Notes Documents, respectively, including as and when the same shall become due and payable in accordance with their terms.

8.16. Marshalling of Assets. Each Notes Agent, on behalf of its respective Notes Claimholders, hereby irrevocably, absolutely, and unconditionally waives any and all rights or powers any Notes Claimholder may have at any time under applicable law or otherwise to have the ABL Priority Collateral, or any part thereof, marshaled upon any foreclosure or other enforcement of the ABL Agent’s Liens. The ABL Agent, on behalf of the ABL Claimholders, and each Notes Agent (other than the Higher Priority Agent) on behalf of its respective Notes Claimholders hereby waives irrevocably, absolutely, and unconditionally any and all rights any ABL Claimholder and any such Notes Claimholders may have at any time under applicable law or otherwise to have the Notes Priority Collateral, or any part thereof, marshaled upon any foreclosure or other enforcement of the Notes Agents’ Liens.

8.17. Exclusive Means of Exercising Rights under this Agreement. The First-Lien Notes Claimholders shall be deemed to have irrevocably appointed the First-Lien Notes Agent, the Second-Lien Notes Claimholders shall be deemed to have irrevocably appointed the Second-Lien Notes Agent, the Third-Lien Notes Claimholders shall be deemed to have irrevocably

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appointed the Third-Lien Notes Agent, and the ABL Claimholders shall be deemed to have irrevocably appointed the ABL Agent, as their respective and exclusive agents hereunder. Consistent with such appointment, such Notes Claimholders and the ABL Claimholders further shall be deemed to have agreed that only their respective Agent (and not any individual Claimholder or group of Claimholders) shall have the exclusive right to exercise any rights, powers, and/or remedies under or in connection with this Agreement (including bringing any action to interpret or otherwise enforce the provisions of this Agreement) or the Collateral; provided, that (i) ABL Claimholders holding obligations in respect of Bank Products or Obligations in respect of Hedging Agreements may exercise customary netting rights with respect thereto, (ii) cash collateral may be held pursuant to the terms of the ABL Loan Documents (including any relating to Bank Products or Hedging Agreements) and any such individual ABL Claimholder may act against such Collateral, (iii) ABL Claimholders may exercise rights of setoff against depository or other accounts maintained with them, and (iv) may exercise rights of setoff against depository or other accounts maintained with them. Specifically, but without limiting the generality of the foregoing, each Noteholder or group of Noteholders, and each ABL Lender or group of ABL Lenders, shall not be entitled to take or file, but instead shall be precluded from taking or filing (whether in any Insolvency or Liquidation Proceeding or otherwise), any action, judicial or otherwise, to enforce any right or power or pursue any remedy under this Agreement (including any declaratory judgment or other action to interpret or otherwise enforce the provisions of this Agreement) or otherwise in relation to the Collateral, except solely as provided in the proviso in the preceding sentence.

8.18. Interpretation. This Agreement is a product of negotiations among representatives of, and has been reviewed by counsel to, each Notes Agent, the ABL Agent, the Company, the Parent, the Company’s Subsidiaries and the initial purchasers of the Notes and is the product of those Persons on behalf of themselves and the Notes Claimholders (in the case of the Notes Claimholders) and the ABL Claimholders (in the case of the ABL Claimholders). Accordingly, this Agreement’s provisions shall not be construed against, or in favor of, any party or other Person merely by virtue of that party or other Person’s involvement, or lack of involvement, in the preparation of this Agreement and of any of its specific provisions.

8.19. Certain Terms Concerning the Notes Agents. Each Notes Agent is executing and delivering this Agreement solely in its capacity as Trustee and Collateral Agent under and pursuant to directions set forth in the respective Notes Documents under which it was appointed; and in so doing, one of the Notes Agent shall be responsible for the terms or sufficiency of this Agreement for any purpose. None of the Notes Agents shall have any duties or obligations under or pursuant to this Agreement other than such duties as may be expressly set forth in this Agreement as duties on its part to be performed or observed. In entering into this Agreement, or in taking (or forbearing from) any action under or pursuant to the Agreement, each Notes Agent shall have and be protected by all of the rights, immunities, indemnities and other protections granted to the Trustee and Collateral Agent under the applicable Indenture and the other applicable Notes Documents.

8.20. Certain Terms Concerning ABL Agent and Notes Agents. Neither the ABL Agent nor any Notes Agent shall have any liability or responsibility for the actions or omissions of any other Secured Party, or for any other Secured Party’s compliance with (or failure to comply with) the terms of this Agreement. Neither the ABL Agent nor any Notes

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Agent shall have individual liability to any Person if it shall mistakenly pay over or distribute to any Secured Party (or the Issuers) any amounts in violation of the terms of this Agreement, so long as the ABL Agent or such Notes Agent, as the case may be, is acting in good faith.

8.21. Credit Bidding. The Parent, the Company and the Agents acknowledge that, following any Notes Default or ABL Default, in the context of any sale of Collateral (whether pursuant to a plan of reorganization, plan of liquidation, under Section 1129 of the Bankruptcy Code or Section 363 of the Bankruptcy Code, Enforcement or otherwise) the First-Lien Notes Agent, on behalf of the First-Lien Notes Claimholders, shall have the right to credit bid up to the full amount of the First-Lien Notes Obligations, the Second-Lien Notes Agent, on behalf of the Second-Lien Notes Claimholders, shall have the right to credit bid up to the full amount of the Second-Lien Notes Obligations, the Third-Lien Notes Agent, on behalf of the Third-Lien Notes Claimholders, shall have the right to credit bid up to the full amount of the Third-Lien Notes Obligations and the ABL Agent, on behalf of the ABL Claimholders, shall have the right to credit bid up to the full amount of the ABL Obligations, subject to the distribution provisions of this Agreement.

8.22. Rights Following Discharge of Obligations. Notwithstanding anything to the contrary in this Agreement:

(a) Upon Discharge of the ABL Obligations, (i) the respective rights of the ABL Agent and the ABL Claimholders under this Agreement granted to the ABL Agents and the ABL Claimholders in respect of the ABL Priority Collateral and (ii) any negative covenants, prohibitions or limitations on actions applicable to the respective Notes Agents and Notes Claimholders under this Agreement relating to their Liens being junior on the ABL Priority Collateral to the ABL Agent and the ABL Claimholders ((i) and (ii), collectively, the “ABL Specific Rights”), shall, so long as the Discharge of the First-Lien Notes Obligations has not occurred, be deemed to benefit the First-Lien Notes Agent and the First-Lien Notes Claimholders as if they were the ABL Agent and the ABL Claimholders under this Agreement; furthermore, upon Discharge of the First-Lien Notes Obligations, if Discharge of the ABL Obligations has occurred and Discharge of the Second-Lien Notes Obligations has not occurred, the ABL Specific Rights shall be deemed to benefit the Second-Lien Notes Agent and the Second-Lien Notes Claimholders as if they were the ABL Agents and the ABL Claimholders under this Agreement; and, furthermore, upon the Discharge of the Second-Lien Notes Obligations, if Discharge of the ABL Obligations and Discharge of the First-Lien Notes Obligations have occurred and Discharge of the Third-Lien Notes Obligations has not occurred, the ABL Specific Rights shall be deemed to benefit the Third-Lien Notes Agent and the Third-Lien Notes Claimholders as if they were the ABL Agents and the ABL Claimholders under this Agreement.

(b) Upon Discharge of the First-Lien Notes Obligations, (i) the respective rights of the First-Lien Notes Agent and the First-Lien Notes Claimholders under this Agreement granted to the First-Lien Notes Agent and the First-Lien Notes Claimholders in respect of the Notes Priority Collateral and (ii) any negative covenants, prohibitions or limitations on actions applicable to the respective Notes Agents and Notes Claimholders and the ABL Agent and the ABL Claimholders under this Agreement relating to their Liens being junior on the Notes Priority Collateral to the First-Lien Notes Agent and the First-Lien Notes Claimholders ((i) and (ii), collectively, the “Notes Specific Rights”), shall, so long as the Discharge of the Second-Lien

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Notes Obligations has not occurred, be deemed to benefit the Second-Lien Notes Agent and Second-Lien Notes Claimholders as if they were the First-Lien Notes Agent and the First-Lien Notes Claimholders under this Agreement; furthermore, upon Discharge of the Second-Lien Notes Obligations, if Discharge of the First-Lien Notes Obligations has occurred and Discharge of the Third Lien Notes Obligations has not occurred, the Notes Specific Rights shall be deemed to benefit the Third-Lien Notes Agent and the Third-Lien Notes Claimholders as if they were the First-Lien Notes Agent and the First-Lien Notes Claimholders under this Agreement; and, furthermore, upon Discharge of the Third-Lien Notes Obligations, if Discharge of the First-Lien Notes Obligations and Second-Lien Notes Obligations have occurred and Discharge of the ABL Obligations has not occurred, the Notes Specific Rights shall be deemed to benefit the ABL Agent and the ABL Claimholders as if they were the First-Lien Notes Agent and the First-Lien Notes Claimholders under this Agreement.

[Signature Pages Follow]

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IN WITNESS WHEREOF, the parties hereto have executed this Intercreditor Agreement as of the date first written above.

ABL Agent:

WELLS FARGO CAPITAL FINANCE, LLC

as ABL Agent

By:

Name:

Title:

Notice Address:

1100 Abernathy Road

Suite 1600

Atlanta, GA 30328

Attn: Loan Portfolio Manager

Fax No. 770-804-0785

with copies to:

Winston & Strawn LLP

214 N. Tryon Street

Suite 2200

Charlotte, NC 28202

Attn: Molly McGill, Esq.

Fax No. 704-350-7800

Signature Page to Horizon Lines, LLC Intercreditor Agreement

First-Lien Notes Agent:

U.S. BANK NATIONAL ASSOCIATION,

as Trustee and Collateral Agent under the Indenture and Collateral Agent under the First-Lien Notes Documents, as First-Lien Notes Agent

By:

Name:

Title:

Notice Address:
100 Wall Street - Suite 1600
New York, New York 10005
Attn: Corporate Trust Services-Horizon Lines, LLC
Fax No. (212) 509-3384 with copies to (which shall not constitute notice):
Pillsbury Winthrop Shaw Pittman LLP
1540 Broadway
New York, New York 10036
Attn:	Bart Pisella, Esq.
	Timothy P. Kober, Esq.
Fax No. (212) 881-9368

Signature Page to Horizon Lines, LLC Intercreditor Agreement

Second-Lien Notes Agent:

U.S. BANK NATIONAL ASSOCIATION,

as Trustee and Collateral Agent under the Indenture and Collateral Agent under the Second-Lien Notes Documents, as Second-Lien Notes Agent

By:

Name:

Title:

Notice Address:
100 Wall Street - Suite 1600
New York, New York 10005
Attn: Corporate Trust Services-Horizon Lines, LLC
Fax No. (212) 509-3384 with copies to (which shall not constitute notice):
Pillsbury Winthrop Shaw Pittman LLP
1540 Broadway
New York, New York 10036
Attn:	Bart Pisella, Esq.
	Timothy P. Kober, Esq.
Fax No. (212) 881-9368

Signature Page to Horizon Lines, LLC Intercreditor Agreement

Third-Lien Notes Agent:

U.S. BANK NATIONAL ASSOCIATION,

as Trustee and Collateral Agent under the Indenture and Collateral Agent under the Third-Lien Notes Documents, as Third-Lien Notes Agent

By:

Name:

Title:

Notice Address:
100 Wall Street - Suite 1600
New York, New York 10005
Attn: Corporate Trust Services-Horizon Lines, LLC
Fax No. (212) 509-3384 with copies to (which shall not constitute notice):
Pillsbury Winthrop Shaw Pittman LLP
1540 Broadway
New York, New York 10036
Attn:	Bart Pisella, Esq.
	Timothy P. Kober, Esq.
Fax No. (212) 881-9368

Signature Page to Horizon Lines, LLC Intercreditor Agreement

Acknowledged and Agreed to by:

Company:

HORIZON LINES, LLC

By:

Name:

Title:

Parent and each other Subsidiary of Parent:

HORIZON LINES, INC.

By:

Name:

Title:

AERO LOGISTICS, LLC

By:

Name:

Title:

HAWAII STEVEDORES, INC.

By:

Name:

Title:

HORIZON LINES HOLDING CORP.

By:

Name:

Title:

HORIZON LINES OF ALASKA, LLC

By:

Name:

Title:

Signature Page to Horizon Lines, LLC Intercreditor Agreement

HORIZON LINES OF GUAM, LLC

By:

Name:

Title:

HORIZON LINES OF PUERTO RICO, INC.

By:

Name:

Title:

HORIZON LINES VESSELS, LLC

By:

Name:

Title:

HORIZON LOGISTICS, LLC

By:

Name:

Title:

HORIZON SERVICES GROUP, LLC

By:

Name:

Title:

SEA-LOGIX, LLC

By:

Name:

Title:

Signature Page to Horizon Lines, LLC Intercreditor Agreement

H-L DISTRIBUTION SERVICE, LLC

By:

Name:

Title:

Notice Address:

4064 Colony Road, Suite 200

Charlotte, NC 28211

Attn: Michael T. Avara

Fax No.

with copies to:

Kirkland & Ellis

601 Lexington Avenue

New York, NY 10022

Attn: Yongjin Im, Esq.

Fax No. 212-446-6460

Signature Page to Horizon Lines, LLC Intercreditor Agreement

Schedule 1

ABL Intercompany Loans

None.

Schedule 2

Notes Intercompany Loans

None.

EXHIBIT A

FORM OF INTERCREDITOR AGREEMENT JOINDER

The undersigned                                         , a                                  , hereby agrees to become a party as [an Additional Pari Passu Notes Agent] [a New Agent] under the Intercreditor Agreement dated as of October 5, 2011 (the “Intercreditor Agreement”) among Horizon Lines, Inc., a Delaware corporation, Horizon Lines, LLC, a Delaware limited liability company, the other Grantors from time to time party thereto, Wells Fargo Capital Finance, LLC, in its capacity as agent under the ABL Credit Agreement, and U.S. Bank National Association, in its capacities as First-Lien Trustee, First-Lien Notes Agent, Second-Lien Trustee, Second-Lien Notes Agent, Third-Lien Trustee and Third-Lien Notes Agent, for all purposes thereof and on the terms set forth therein, and to be bound by the terms of the Intercreditor Agreement as fully as if the undersigned had executed and delivered the Intercreditor Agreement on the date thereof. All capitalized terms used but not defined herein shall have the meanings ascribed to them in the Intercreditor Agreement.

The undersigned, on behalf of itself and the holders it acts as an agent for, agrees to (i) be bound by the terms of the Intercreditor Agreement applicable to them, (ii) appoint the applicable Notes Agent to act as their representative hereunder and (iii) agree to be bound by the pari passu intercreditor provisions contained in the Notes Security Documents entered into in connection with the applicable Indenture (pursuant to which such Indebtedness described in this definition was issued) (which provisions are binding on the applicable Notes Claimholders only).

The provisions of Section 8 of the Intercreditor Agreement shall apply with like effect to this Intercreditor Agreement Joinder.

IN WITNESS WHEREOF, the undersigned has caused this Intercreditor Agreement Joinder to be executed by its respective officer or representative as of             , 20    .

[ ]

By:
	Name:
	Title:

EXHIBIT B

FORM OF NEW DEBT NOTICE

Pursuant to Section 5.5 of the Intercreditor Agreement dated as of October     , 2011 (the “Intercreditor Agreement”) among Horizon Lines, Inc. (the “Company”), a Delaware corporation, Horizon Lines, LLC, a Delaware limited liability company, the other Grantors from time to time party thereto, Wells Fargo Capital Finance, LLC, in its capacity as agent under the ABL Credit Agreement, and U.S. Bank National Association, in its capacities as First-Lien Trustee, First-Lien Notes Agent, Second-Lien Trustee, Second-Lien Notes Agent, Third-Lien Trustee and Third-Lien Notes Agent, the Company has entered into new [ABL Loan Documents] [Notes Documents].

Enclosed is a complete copy of the relevant new [ABL Loan Documents] [Notes Documents]. The New Agent is             , a             .

Date:

HORIZON LINES, INC.
By:
	Name:
	Title:

EX-10.8

Exhibit 10.8

SECOND AMENDMENT TO RESTRUCTURING SUPPORT

AGREEMENT

This SECOND AMENDMENT TO RESTRUCTURING SUPPORT AGREEMENT (this “Amendment”), dated as of October 3, 2011, is by and between Horizon Lines, Inc. (the “Parent”), a corporation duly organized and existing under the laws of the State of Delaware, and all of its subsidiaries and any successors thereto (collectively with the Parent, the “Company”) and the holder set forth on the signature page (the “Exchanging Holder”) of the 4.25% convertible senior notes due 2012 (the “Notes”) issued under the Indenture, dated as of August 8, 2007 (as amended, supplemented, or modified from time to time, the “Indenture”), by and between the Parent, as issuer, and The Bank of New York Trust Company, N.A., as Trustee, in the aggregate principal amount of $330,000,000.00. Capitalized terms not herein defined shall have the meanings set forth in the RSA (as defined below).

RECITALS

WHEREAS, the Company and the Exchanging Holder are party to that certain Restructuring Support Agreement dated as of August 26, 2011 (as amended modified, or supplemented from time to time, the “RSA”); and

WHEREAS, the Company has requested that the Exchanging Holder amend the RSA and the Exchanging Holder has agreed to amend the RSA in accordance with and subject to the terms and conditions set forth herein.

AGREEMENT

NOW, THEREFORE, in consideration of the agreements hereinafter set forth, and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the Parties hereto agree as follows:

1. Amendments to the RSA.

1.1 Section 26 of the RSA is hereby amended and restated in its entirety as follows:

“Section 26. Corporate Governance and Management/Employee Incentive Plan

The Company acknowledges that the terms set forth in the Restructuring Term Sheet under the Headings “Corporate Governance” and “Management/Employee Incentive Plan” will not be satisfied as of the Effective Date. As a result thereof, the Company covenants and agrees that it shall:

(i) with respect to those seven (7) candidates who will be designated by the Exchanging Holder(s) (each a “Holder Designee”) to the Company’s board of directors (the “Board”, each director a “Director”), in the period between the closing of the Exchange Offer and the Effective

Date, nominate and subsequently elect (subject to the Company’s customary due diligence process) all seven Holder Designees to the Board as promptly as possible after the Effective Date but, in any event, by the earlier to occur of (x) October 27, 2011 and (y) the first meeting of the Company’s shareholders that occurs following the Effective Date (the “Meeting”);

(ii) if any Holder Designee is not timely elected as set forth in clause (i) above, then the Company shall nominate the Holder Designees as a slate of director candidates for approval by the shareholders at the Meeting (subject to the Company’s customary due diligence process);

(iii) use reasonable best efforts to cause the Board to expand to comprise eleven (11) Directors;

(iv) use reasonable best efforts to cause the Holder Designees to comprise a majority of Directors of the Board at or prior to the Meeting;

(v) use reasonable best efforts to implement a 1 to 25 reverse share split at the Meeting;

(vi) not adopt or propose any management incentive plan or make any grants of stock, options or other compensation under any management incentive plan until such time as all of the appointments and other actions set forth in subclauses (i) and (ii) above shall have been effectuated; provided, however, that any management incentive plan thereafter approved and implemented by the Company shall be consistent in all respects with the terms set forth in the Restructuring Term Sheet;

(vii) if any Holder Designee is not elected to the Board at or prior to the Meeting, then the Holder Designees who have been so elected as Directors shall nominate and elect one or more candidates as necessary for the Holder Designees elected pursuant to this subclause (vii), together with the Holder Designees elected pursuant to subclauses (i) and (ii) above, to constitute a majority of Directors of the Board; and

(viii) in the event the Board is unable to agree on the four existing Directors (excluding Holder Designees) to remain on the Board following the Effective Date, the Company shall use its reasonable best efforts to cause the terms of the existing Directors in a class with the longest term expiry to terminate, it being understood, however that this clause (viii) shall not apply to the chairman of the Board in office as of the Effective Date.

2. Effectiveness. In accordance with Section 16 of the RSA, this Amendment shall be effective and binding upon the Company and the undersigned Exchanging Holder as of the date (the “Amendment Effective Date”) on which: (i) the Company shall have

executed and delivered counterpart signature pages of this Amendment to counsel to the Exchanging Holders and (ii) at least two-thirds of the Exchanging Holders, each of which is a party to a Similar RSA, shall have executed and delivered counterpart signature pages of this Amendment to counsel to the Company.

3. Representations and Warranties. Each Party hereby represents and warrants that as of the Amendment Effective Date, the representations and warranties contained in Section 8 of the RSA are true and current in all material respects on and as of Amendment Effective Date (and after giving pro forma effect to the Transactions) to the same extent as though made on and as of that date, except to the extent such representations and warranties specifically relate to an earlier date, in which case such representations and warranties shall have been true and correct in all material respects on and as of such earlier date.

4. Effect Upon RSA. Except as specifically set forth herein, the RSA shall remain in full force and effect and is hereby ratified and confirmed. The parties hereto specifically acknowledge and agree that the RSA, as hereby amended, is in full force and effect in accordance with its respective terms and has not been modified, except pursuant to this Amendment. This Amendment shall be deemed to be Definitive Documentation for all purposes under and in connection with the RSA and the other Definitive Documentation and shall be binding upon and inure to the benefit of each of the parties hereto and their respective successors and assigns. All references to the “RSA” in the Definitive Documentation shall mean and refer to the RSA, as modified by this Amendment.

5. Counterparts. This Amendment may be executed in one or more counterparts, each of which, when so executed, shall constitute the same instrument and the counterparts may be delivered by facsimile transmission or by electronic mail in portable document format (.pdf).

6. Headings. The headings of the sections, paragraphs and subsections of this Amendment are inserted for convenience only and shall not affect the interpretation hereof.

7. Governing Law. This Amendment shall be governed by, and construed in accordance with, the laws of the State of New York, without regard to such state’s choice of law provisions which would require the application of the law of any other jurisdiction.

IN WITNESS WHEREOF, the Parties hereto have caused their duly authorized officers to execute and deliver this Amendment as of the date first above written.

HORIZON LINES, INC.
By:
	Name:
	Title:
HORIZON LINES HOLDING CORP.
By:
	Name:
	Title:
HORIZON LINES, LLC
By:
	Name:
	Title:
HORIZON LINES OF PUERTO RICO, INC.
By:
	Name:
	Title:
HAWAII STEVEDORES, INC.
By:
	Name:
	Title:

Signature Page to Second Amendment to Restructuring

Support Agreement

HORIZON LOGISTICS, LLC
By:
	Name:
	Title:
H-L DISTRIBUTION SERVICE, LLC
By:
	Name:
	Title:
HORIZON LINES OF ALASKA, LLC
By:
	Name:
	Title:
HORIZON LINES OF GUAM, LLC
By:
	Name:
	Title:
HORIZON LINES VESSELS, LLC
By:
	Name:
	Title:

Signature Page to Second Amendment to Restructuring

Support Agreement

SEA-LOGIX, LLC
By:
	Name:
	Title:
AERO LOGISTICS, LLC
By:
	Name:
	Title:
HORIZON SERVICES GROUP, LLC
By:
	Name:
	Title:

Signature Page to Second Amendment to Restructuring

Support Agreement

EXCHANGING HOLDER:
[INSERT NAME OF EXCHANGING HOLDER ]
By:
	Name:
	Title:

Signature Page to Second Amendment to Restructuring

Support Agreement

EX-99.1

Exhibit 99.1

PRESS RELEASE

For information contact:

Jim Storey

Director, Investor Relations & Corporate Communications

704.973.7107

jstorey@horizonlines.com

HORIZON LINES COMPLETES COMPREHENSIVE REFINANCING

New Capital Structure Provides Opportunity for Significant Deleveraging

CHARLOTTE, NC, October 5, 2011 – Horizon Lines, Inc. (NYSE: HRZ) today announced that it has completed a comprehensive refinancing of the company’s entire capital structure. The new capital structure addresses the company’s financial needs by providing adequate liquidity to fund continuing operations and the ability to achieve substantial additional debt reduction.

“We now have a new capital structure that eliminates the refinancing uncertainty faced by our company over the past several months and better positions us for the future,” said Stephen H. Fraser, President and Chief Executive Officer. “We have put in place a solid financial foundation that affords us the opportunity to grow our business and significantly reduce debt over time.”

The terms of the recapitalization, which results in a $652.8 million financial restructuring, consist of the following:

• Certain holders of the 4.25% convertible senior notes due 2012 (the “2012 convertible notes”) and certain other parties purchased $225.0 million of 11.00% first-lien secured notes. The notes mature in October 2016, and are callable at 101.5% of the aggregate principal plus accrued and unpaid interest in year one, and at par plus accrued and unpaid interest thereafter.

• Certain holders of the 2012 convertible notes and certain other parties also purchased $100.0 million of second-lien secured notes, maturing in October 2016. The second-lien notes bear interest, payable semi-annually at a rate of 13.00% per annum if paid in cash, 14.00% per annum if paid 50% in cash and 50% in kind, and 15.00% per annum if paid in kind, at the company’s option. The $100.0 million amount includes second-lien notes that were issued in exchange for a $25.0 million bridge loan that was entered into in September 2011, with the remaining $75.0 million issued at par. The new second-lien secured notes are non callable for two years. After that, they are callable at 106% of the aggregate principal plus accrued and unpaid interest in year three, at 103% plus accrued and unpaid interest in year four, and at par plus accrued and unpaid interest thereafter.

Horizon Lines Completes Refinancing Page 2 of 4

• Additionally, the company and its subsidiaries entered into a new, $100.0 million, asset-based revolving credit facility arranged through Wells Fargo Capital Finance, LLC to provide liquidity for continuing operations. Availability under the ABL facility is based on a percentage of eligible accounts receivable, up to a maximum of $100.0 million. The ABL facility matures in October 2016, although the maturity will accelerate by 90 days if the first-lien notes and second-lien notes have not been repaid, refinanced or defeased by such date. The ABL facility bears interest at a floating rate based on a specified spread over LIBOR. The initial rate will be LIBOR plus 3.25%. No amounts were drawn at the closing date, although there were $19.1 million of outstanding letters of credit under the ABL facility, with $67.1 million available for borrowing.

• The company also completed its exchange offer and consent solicitation, in which $178.8 million of new 6.00% Series A convertible senior secured notes due April 15, 2017, $99.3 million of new 6.00% Series B mandatorily convertible senior secured notes, and $49.7 million of common stock and warrants, issued at $1.00 par value, were exchanged for the $327.8 million of 2012 convertible notes that were validly tendered in the exchange offer. In total, 99.3% of the $330.0 million of 2012 convertible notes were validly tendered in the exchange offer. Interest on the new notes is payable semi–annually in cash. The Series A Notes are convertible at the option of the holders, and at the company’s option under certain circumstances beginning on the one-year anniversary of their issuance, into shares of common stock or warrants, as described below. The Series B Notes are mandatorily convertible into shares of the company’s common stock or warrants in two equal installments of approximately $49.7 million each on the three-month and nine-month anniversaries of the consummation of the exchange offer, subject to certain conditions, as described below.

“We greatly appreciate the support of our note holders, previous lender group and the new lenders to facilitate this comprehensive and complex refinancing in an orderly and timely manner,” said Michael T. Avara, Executive Vice President and Chief Financial Officer. “We also are grateful to our teams of advisors from Kirkland & Ellis LLP and Moelis & Company for their expert advice, creativity and diligence through this arduous process. Our thanks further extends to Paul, Weiss, Rifkind, Wharton & Garrison LLP and Houlihan Lokey, who were the legal and financial advisors, respectively, to the holders of the 2012 convertible notes, for their important contributions.”

In the exchange offer, the company issued 25.1 million shares of common stock and 24.6 million warrants, based on the U.S. citizenship verifications of the participating 2012 convertible note holders.

Horizon Lines Completes Refinancing Page 3 of 4

Under terms of the new notes, and subject to certain conditions (including, without limitation, having sufficient authorized shares of common stock and the continued listing of the common stock), the company has the right to convert the new Series B Notes into $49.7 million of common stock or warrants at approximately $0.73 per share after January 5, 2012, and another $49.7 million of common stock or warrants at approximately $0.73 per share after July 5, 2012. After October 5, 2012, subject to certain conditions (including, without limitation, having sufficient authorized shares of common stock and the continued listing of the common stock), the company has the right to convert into common stock or warrants the new Series A Notes at its option, in whole or in part, and from time to time, at approximately $0.45 per share, plus accrued and unpaid interest, provided that the 30-trading-day, volume-weighted average price of the common stock is at least $0.63 per share at the conversion date.

Proceeds from the first-lien notes and the second-lien notes were used, among other things, to satisfy in full the company’s obligations outstanding under its previous first-lien revolving credit facility and term loan, which totaled $265.0 in principal and $1.4 million in accrued interest and fees.

In connection with the consent solicitation noted above, holders of old notes consented to amend the indenture related to the 2012 convertible notes, and the company and the trustee executed a supplemental indenture, removing or amending substantially all of the restrictive covenants, as well as modifying certain of the events of default and various other provisions contained in the old indenture.

The company will file with the SEC a Current Report on Form 8-K containing copies of the various agreements described herein.

About Horizon Lines

Horizon Lines, Inc. is the nation’s leading domestic ocean shipping and integrated logistics company. The company owns or leases a fleet of 20 U.S.-flag containerships and operates five port terminals linking the continental United States with Alaska, Hawaii, Guam, Micronesia and Puerto Rico. The company provides express trans-Pacific service between the U.S. West Coast and the ports of Ningbo and Shanghai in China, manages a domestic and overseas service partner network and provides integrated, reliable and cost competitive logistics solutions. Horizon Lines, Inc., is based in Charlotte, NC, and trades on the New York Stock Exchange under the ticker symbol HRZ.

Forward Looking Statements

The information contained in this press release should be read in conjunction with our filings made with the Securities and Exchange Commission. This press release contains “forward-looking statements” within the meaning of the federal securities laws. Forward-looking statements are those that do not relate solely to historical fact. They include, but are not limited to, any statement that may predict, forecast, indicate or imply future results, performance, achievements or events. Words such as, but not limited to, “will,” “intend,” “expect,” “would,” “could,” “must,” “may,” and similar expressions or phrases identify forward-looking statements.

Horizon Lines Completes Refinancing Page 4 of 4

Factors that may cause expected results or anticipated events or circumstances discussed in this press release to not occur or to differ from expected results include: our ability to maintain adequate liquidity to operate our business; our ability to refinance, repay, or extend our indebtedness when it becomes due; volatility in fuel prices; the cyclical nature of international shipping industry and resulting volatile changes in freight rates; decreases in shipping volumes; failure to comply with the terms of our probation imposed by the court in connection with our plea relating to antitrust matters; any new adverse developments relating to antitrust matters in any of our trades; failure to resolve or successfully defend pending and future civil antitrust claims or our pending securities litigation; government investigations related to environmental regulations including recordkeeping and reporting requirements for vessel generated pollution and any other government investigations and legal proceedings; suspension or debarment by the federal government; compliance with safety and environmental protection and other governmental requirements; increased inspection procedures and tighter import and export controls; repeal or substantial amendment of the coastwise laws of the United States, also known as the Jones Act; our ability to remain Jones Act compliant because of changes in ownership; catastrophic losses and other liabilities; the arrest of our vessels by maritime claimants; severe weather and natural disasters; and the aging of our vessels and unexpected substantial dry-docking or repair costs for our vessels.

All forward-looking statements involve risk and uncertainties. In light of these risks and uncertainties, expected results or other anticipated events or circumstances discussed in this press release might not occur. The forward-looking statements included in the press release are made only as of the date they are made and the company undertakes no obligation to update any such statements, except as otherwise required by applicable law. See the section entitled “Risk Factors” in our Form 10-K filed with the SEC on March 28, 2011, for a more complete discussion of these risks and uncertainties and for other risks and uncertainties. Those factors and the other risk factors described therein are not necessarily all of the important factors that could cause actual results or developments to differ materially from those expressed in any of our forward-looking statements. Other unknown or unpredictable factors also could harm our results. Consequently, there can be no assurance that actual results or developments anticipated by us will be realized or, even if substantially realized, that they will have the expected consequences.

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