8-K

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):  September 27, 2002

BMC Industries, Inc.

(Exact name of registrant as specified in its charter)

Minnesota	1-8467	41-0169210
(State of Incorporation)	(Commission file number)	(I.R.S. Employer Identification No.)
One Meridian Crossings, Suite 850
Minneapolis, Minnesota		55423
(Address of principal executive offices)		(Zip Code)

(952) 851-6000

(Registrant's telephone number)

Items 1-4.	Not Applicable.
Item 5.	Other Events.

                The Registrant has entered into a Third Amended and Restated Credit Agreement (the "Amendment"), dated as of September 27, 2002, with Deutsche Bank Trust Company Americas, as administrative agent for the lenders and a lender; Bank One, NA, as documentation agent and a lender; and the several banks and other financial institutions from time to time parties thereto, amending the Registrant's Second Amended and Restated Credit Agreement, dated as of October 12, 2001, as has been amended from time to time (the "Second Amended and Restated Credit Agreement," and as amended by the Amendment, the "Credit Agreement").

                The Amendment, among other changes, extends the remaining term of the Credit Agreement by an additional year, from May 2003 to May 2004. Further, the Amendment permanently reduced the aggregate commitment under the Credit Agreement from $185,000,000 to $145,000,000.

                In conjunction with the Amendment (and in addition to the pre-existing collateral under the Second Amended and Restated Credit Agreement), the Registrant, Vision-Ease Lens, Inc., and Vision-Ease Lens Azusa, Inc. entered into Amended and Restated Security Agreements providing additional collateral, and the Registrant granted a mortgage on its real property located in Cortland, New York, to secure the obligations under the Credit Agreement.  Such additional collateral and mortgage will also secure up to a maximum amount of $2,000,000 of the Registrant's obligations under an existing Continuing Reimbursement Agreement for Commercial Letters of Credit, dated as of July 14, 2000, between the Registrant and U.S. Bank National Association.

Item 6.	Not Applicable.
Item 7.	Financial Statements and Exhibits.
	(a) - (b)	Not Applicable.
	(c)	Exhibits Required by Item 601 of Regulation S-K.
	Exhibit	Description
	10.45	Third Amended and Restated Credit Agreement, dated as of September 27, 2002, among BMC Industries, Inc., Deutsche Bank Trust Company Americas, as Administrative Agent and Bank One, NA, as Documentation Agent and Various Lending Institutions.
	10.46	Amended and Restated Security Agreement, dated as of September 27, 2002, between BMC Industries, Inc., Deutsche Bank Trust Company Americas, as Administrative Agent and U.S. Bank National Association.
	10.47	Amended and Restated Subsidiary Guarantor Security Agreement, dated as of September 27, 2002, between Vision-Ease Lens, Inc., Vision-Ease Lens, Azusa, Inc, Deutsche Bank Trust Company Americas, as Administrative Agent and U.S. Bank National Association.
	10.48	Amended and Restated Subsidiary Guarantee Agreement, dated as of October 12, 2001, made by Vision-Ease Lens, Inc. and Vision-Ease Lens Azusa, Inc. (Incorporated by reference to Exhibit 10.49 to the Company's Current Report on Form 8-K dated October 12, 2001 and filed with the Commission on October 24, 2001 (File No. 1-8467)).
	10.49	Second Amended and Restated Pledge Agreement, dated as of October 12, 2001, made by BMC Industries, Inc., to Bankers Trust Company, as Collateral Agent. (Incorporated by reference to Exhibit 10.50 to the Company's Current Report on Form 8-K dated October 12, 2001 and filed with the Commission on October 24, 2001 (File No. 1-8467)).
	10.50	First Amendment to Mortgage, effective as of September 27, 2002, by and between Vision-Ease Lens, Inc. and Deutsche Bank Trust Company Americas, as Administrative Agent.
	10.51	Mortgage, Assignment of Leases and Rents, and Security Agreement, dated as of September 27, 2002, made by BMC Industries, Inc. and Cortland County Industrial Development Agency to Deutsche Bank Trust Company Americas, in its capacity as Administrative Agent under the Credit Agreement
Items 8-9.		Not Applicable.

SIGNATURE

                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 thereunto duly authorized.

	BMC INDUSTRIES, INC.
Dated:  October 2, 2002	By:	/s/Jon A. Dobson
	Its:	Vice President, General Counsel and Secretary

EXHIBIT INDEX

Exhibit	Description	Method of Filing
10.45	Third Amended and Restated Credit Agreement, dated as of September 27, 2002, among BMC Industries, Inc., Deutsche Bank Trust Company Americas, as Administrative Agent and Bank One, NA, as Documentation Agent and Various Lending Institutions.	Electronic Transmission
10.46	Amended and Restated Security Agreement, dated as of September 27, 2002, between BMC Industries, Inc., Deutsche Bank Trust Company Americas, as Administrative Agent and U.S. Bank National Association.	Electronic Transmission
10.47	Amended and Restated Subsidiary Guarantor Security Agreement, dated as of September 27, 2002, between Vision-Ease Lens, Inc., Vision-Ease Lens, Azusa, Inc, Deutsche Bank Trust Company Americas, as Administrative Agent and U.S. Bank National Association.	Electronic Transmission
10.48	Amended and Restated Subsidiary Guarantee Agreement, dated as of October 12, 2001, made by Vision-Ease Lens, Inc. and Vision-Ease Lens Azusa, Inc.	Incorporated by reference to Exhibit 10.49 to the Company's Current Report on Form 8-K dated October 12, 2001 and filed with the Commission on October 24, 2001 (File No. 1-8467).
10.49	Second Amended and Restated Pledge Agreement, dated as of October 12, 2001, made by BMC Industries, Inc., to Bankers Trust Company, as Collateral Agent.	Incorporated by reference to Exhibit 10.50 to the Company's Current Report on Form 8-K dated October 12, 2001 and filed with the Commission on October 24, 2001 (File No. 1-8467).
10.50	First Amendment to Mortgage, effective as of September 27, 2002, by and between Vision-Ease Lens, Inc. and Deutsche Bank Trust Company Americas, as Administrative Agent.	Electronic Transmission
10.51	Mortgage, Assignment of Leases and Rents, and Security Agreement, dated as of September 27, 2002, made by BMC Industries, Inc. and Cortland County Industrial Development Agency to Deutsche Bank Trust Company Americas, in its capacity as Administrative Agent under the Credit Agreement.	Electronic Transmission

EX-10.45 3 credit-agreement.htm

BMC INDUSTRIES, INC.

______________________________

THIRD AMENDED AND RESTATED CREDIT AGREEMENT

dated as of September 27, 2002

______________________________

DEUTSCHE BANK TRUST COMPANY AMERICAS,
as Administrative Agent

BANK ONE, NA,
as Documentation Agent

and

VARIOUS LENDING INSTITUTIONS

TABLE OF CONTENTS

Page

ARTICLE I	2
1.1	Defined Terms.	2
1.2	Accounting Terms, Financial Statements.	37
1.3	Other Definitional Terms.	37
ARTICLE II	38
2.1	The Commitments.	38
	(a)  Term Loans.	a
	(b)  Revolving Loan Commitment	38
	(c)  Swing Line Loans.	39
2.2	Notes.	41
	(a)  Evidence of Indebtedness.	41
	(b)  Notation of Payments.	42
2.3	Minimum Amount of Each Borrowing; Maximum Number of Borrowings.	42
2.4	Borrowing Options.	42
2.5	Notice of Borrowing.	43
2.6	Conversion or Continuation.	43
2.7	Disbursement of Funds; Funding Assumptions.	44
2.8	Pro Rata Borrowings.	45
2.9	Amount and Terms of Letter of Credit.	45
	(a)  Letter of Credit Commitments, Terms of Letters of Credit.	45
	(b)  Procedure for Issuance of Letters of Credit.	46
	(c)  Draws upon Letters of Credit; Reimbursement Obligation.	47
	(d)  Lenders' Participation in Letters of Credit.	47
	(e)  Fees for Letters of Credit.	48
	(f)  LC Obligations Unconditional.	49
	(g)  Indemnification.	50
ARTICLE III	51
3.1	Interest.	52
	(a)  Base Rate Loans.	52
	(b)  Eurodollar Loans.	52
	(c)  Payment of Interest.	52
	(d)  Notification of Rate.	52
	(e)  Default Interest.	52
	(f)  Maximum Interest.	52
3.2	Fees.	53
	(a)  Commitment Fee.	53
	(b)  Agency Fees.	53
	(c)  Third Amended and Restated Credit Agreement Fees	53
	(d)  July 1, 2003 Special Fee	53
3.3	Computation of Interest and Fees.	53
3.4	Interest Periods.	54
3.5	Compensation for Funding Losses.	54
3.6	Increased Costs, Illegality, Etc.	55
	(a)  Generally.	55
	(b)  Eurodollar Loans.	57
	(c)  Capital Requirements.	57
	(d)  Change of Lending Office.	57
3.7	Replacement of Affected Lenders.	58
ARTICLE IV	58
4.1	Voluntary Reduction of Commitments.	58
4.2	Voluntary Prepayments.	59
4.3	Mandatory Prepayments.	60
	(a)  Prepayment Upon Overadvance.	60
	(b)  Payment at Termination Date.	60
	(c)  Mandatory Prepayment Upon Asset Disposition.	61
	(d)  Mandatory Prepayment Upon Incurrence of Indebtedness.	61
	(e)  Scheduled Term Repayments.	61
	(f)  Mandatory Prepayment With Excess Cash Flow.	61
	(g)  Mandatory Prepayment Upon Recovery Event	61
4.4	Application of Prepayments.	62
4.5	Method and Place of Payment.	62
4.6	Net Payments.	63
ARTICLE V	66
5.1	Corporate Existence; Compliance with Law.	67
5.2	Corporate Power; Authorization; No Violation.	67
5.3	Binding Effect.	67
5.4	Purpose of Loans.	67
5.5	Subsidiaries.	68
5.6	Indebtedness.	68
5.7	Financial Statements; Financial Condition; Undisclosed Liabilities; Projections, etc.	68
	(a)  Financial Statements.	68
	(b)  Solvency.	68
	(c)  No Undisclosed Liabilities.	69
	(d)  Projections.	69
5.8	No Material Litigation.	69
5.9	Performance of Agreements.	69
5.10	Taxes.	69
5.11	Governmental Regulation.	70
5.12	Ownership of Property; Liens.	70
5.13	Intellectual Property.	70
5.14	Disclosure.	70
5.15	ERISA.	71
5.16	Labor Relations.	71
5.17	Insurance.	71
5.18	Public Utility Holding Company Act.	71
5.19	Security Documents.	71
	(a)  Security Agreement Collateral.	71
	(b)  Real Estate Collateral.	71
5.20	Matters Pertaining to Second Amendment and Restatement Agreement.	72
	(a)  Representations and Warranties	72
	(b)  Corporate Power; Authorization; No Violation	72
5.21	Matters Pertaining to Third Amended and Restated Credit Agreement	72
	(a)  Representations and Warranties	72
	(b)  Corporate Power; Authorization; No Violation	72
5.22	Deposit Accounts	73
ARTICLE VI	73
6.1	Conditions Precedent to Effectiveness.	73
	(a)  Loan Documents.	73
	(b)  Corporate Proceedings.	74
	(c)  Corporate Documents.	75
	(d)  Incumbency Certificate.	75
	(e)  Fees and Amendment Fee.	75
	(f)  Legal Opinions.	75
	(g)  Approvals.	75
	(h)  Litigation.	76
	(i)  Officer's Certificate.	76
	(j)  Adverse Change.	76
6.2	Conditions Precedent to Effectiveness.	76
	(a)  Loan Documents.	76
	(b)  Corporate Proceedings.	78
	(c)  Corporate Documents.	78
	(d)  Incumbency Certificate.	78
	(e)  Fees and Amendment Fee.	78
	(f)  Legal Opinions.	79
	(g)  Approvals.	79
	(h)  Litigation.	79
	(i)  Officer's Certificate.	79
	(j)  Adverse Change.	79
6.3	Certain Conditions Precedent to Each Loan.	80
	(a)  Representations and Warranties.	80
	(b)  No Events of Default.	80
	(c)  Available Revolving Commitment.	80
	(d)  Other Matters.	80
ARTICLE VII	81
7.1	Financial Statements.	81
7.2	Certificates; Other Information.	82
	(a)  Accountant's Certificates.	82
	(b)  Officer's Certificate.	82
	(c)  Budgets; Projections.	82
	(d)  Audit Reports and Statements.	82
	(e)  Public Filings.	83
	(f)  Status.	83
	(g)  Other Requested Information	83
	(h)  Borrowing Base Certificate	83
7.3	Notices.	83
	(a)  Event of Default or Unmatured Event of Default.	83
	(b)  Litigation and Related Matters.	83
	(c)  Notice of Change of Control.	83
7.4	Conduct of Business and Maintenance of Existence.	84
7.5	Payment of Obligations.	84
7.6	Inspection of Property, Books and Records.	84
7.7	ERISA.	85
7.8	Insurance.	86
7.9	Environmental Laws.	86
7.10	Additional Subsidiary Guarantors.	87
7.11	Intentionally Omitted.	87
7.12	Additional Security; Further Assurances.	87
	(a)  Additional Subsidiary Guarantors.	87
	(b)  Pledge of New Subsidiary Stock.	87
	(c)  Grant of Security by New Domestic Subsidiaries.	87
	(d)  Documentation for Additional Security.	87
	(e)  Foreign Subsidiaries Security.	88
	(f)  Agreement to Grant Additional Security	88
7.13	Pledge of BV1	88
7.14	Third Party Consultant	89
7.15	Field Audit	89
7.16	Operating Accounts and Deposit Accounts	89
ARTICLE VIII	90
8.1	Financial Condition Covenants.	90
	(a)  Maintenance of Consolidated Net Worth.	90
	(b)  Leverage Ratio.	90
	(c)  Interest Coverage Ratio.	90
	(d)  Capital Expenditures.	91
8.2	Indebtedness.	91
8.3	Liens.	92
8.4	Fundamental Changes.	92
8.5	Restricted Payments.	93
8.6	Distributions from Subsidiaries.	93
8.7	Sales of Assets and Subsidiary Stock.	93
8.8	Investments.	94
8.9	Transactions with Affiliates.	94
8.10	Sale-Leasebacks.	94
8.11	Fiscal Year.	94
8.12	Amendments to Organizational Documents.	94
8.13	Accounting Changes.	94
8.14	Lines of Business.	94
8.15	Limitation on Voluntary Payments	94
ARTICLE IX	95
9.1	Events of Default.	95
	(a)  Failure to Make Payments When Due.	95
	(b)  Representations.	95
	(c)  Breach of Certain Covenants.	95
	(d)  Other Defaults Under Agreement or Loan Documents.	95
	(e)  Default Under Other Agreements.	95
	(f)  Judgments.	96
	(g)  Voluntary Insolvency, Etc.	96
	(h)  Involuntary Insolvency, Etc.	96
	(i)  Unenforceability.	96
	(j)  ERISA.	96
	(k)  Change of Control.	97
	(l)  Environmental Default.	97
	(m)  Security Documents.	97
9.2	Rescission of Acceleration.	98
9.3	Rights Not Exclusive.	98
ARTICLE X	99
10.1	Appointment and Authorization.	99
10.2	Nature of Duties.	99
10.3	Liability of Agent.	99
10.4	Reliance by Agent.	100
10.5	Notice of Default.	100
10.6	Credit Decision.	101
10.7	Indemnification.	101
10.8	Agent in Individual Capacity.	102
10.9	Resignation by Agent.	102
10.10	Documentation Agent.	103
ARTICLE XI	103
11.1	No Waiver; Modifications in Writing.	103
11.2	Intentionally omitted.	105
11.3	Notices, Etc.	105
11.4	Costs, Expenses and Taxes; Indemnity.	105
	(a)  Generally.	105
	(b)  Indemnification.	106
11.5	Confirmations.	108
11.6	Transfer of Notes.	108
11.7	Adjustments; Setoff.	108
11.8	Execution in Counterparts.	110
11.9	Binding Effect; Assignment; Addition and Substitution of Lenders.	110
11.10	CONSENT TO JURISDICTION; MUTUAL WAIVER OR JURY TRIAL.	112
11.11	Governing Law.	113
11.12	Registry.	113
11.13	Severability of Provisions.	114
11.14	Headings.	114
11.15	Independent Nature of Lenders' Rights.	114
11.16	Survival of Representations.	114
11.17	Confidentiality.	114
11.18	Effectiveness.	115
11.19	Waiver of Immunities.	115
11.20	Concerning the Collateral and the Loan Documents.	115
	(a)  Authority.	115
	(b)  Release of Collateral.	116
	(c)  No Obligation.	117

Schedules
Schedule 2.1(a)(i)	--	Converted Term Loan Amounts
Schedule 2.1(a)(ii)	--	Original Term Loan, Term A Loan and Term B Loan Amounts
Schedule 2.9(a)(i)	--	Existing Letters of Credit
Schedule 2.1(b)	--	Revolving Commitments
Schedule 5.5	--	Subsidiaries
Schedule 5.6	--	Indebtedness
Schedule 5.7(c)	--	Liabilities
Schedule 5.7(d)	--	Projections
Schedule 5.22	--	Deposit Accounts
Schedule 8.2(c)	--	Outstanding Subsidiary Indebtedness
Schedule 8.3	--	Permitted Liens
Schedule 8.6(a)	--	Certain Restrictions
Schedule 11.3	--	Addresses for Notice; Payment and Lending Offices
Exhibits
Exhibit 2.2(a)-1(a)	--	Form of Term A Note
Exhibit 2.2(a)-1(b)	--	Form of Term B Note
Exhibit 2.2(a)-2	--	Form of Revolving Note
Exhibit 2.2(a)-3	--	Form of Swing Line Note
Exhibit 2.5	--	Form of Notice of Borrowing
Exhibit 2.6	--	Form of Notice of Conversion or Continuation
Exhibit 2.9	--	Form of Letter of Credit Request
Exhibit 4.6(d)	--	Form of Section 4.6(d)(ii) Certificate
Exhibit 6.1(a)(iii)(x)	--	Form of Borrower Security Agreement
Exhibit 6.1(a)(iii)(y)	--	Form of Subsidiary Guarantor Security Agreement
Exhibit 6.1(a)(iv)	--	Form of Pledge Agreement
Exhibit 6.1(a)(v)	--	Form of Subsidiary Guarantee Agreement
Exhibit 6.1(a)(vi)(i)	--	Form of Ramsey Mortgage
Exhibit 6.1(a)(vi)(ii)	--	Form of Ramsey Mortgage Title Insurance Commitment
Exhibit 6.1(f)(i)	--	Form of Opinion of Borrower's general counsel
Exhibit 6.1(f)(ii)	--	Form of Opinion of Borrower's outside counsel
Exhibit 6.1(f)(iii)	--	Form of Opinion of Borrower's outside real estate counsel
Exhibit 6.1(i)	--	Form of Officer's Certificate
Exhibit 6.2(a)(vi)(i)	--	Form of Cortland Mortgage
Exhibit 6.2(a)(vi)(ii)	--	Form of Cortland Mortgage Title Insurance Commitment
Exhibit 6.2(f)(i)	--	Form of Opinion of Borrower's outside counsel
Exhibit 6.2(f)(ii)	--	Form of Opinion of Borrower's general counsel
Exhibit 6.2(i)	--	Form of Officer's Certificate
Exhibit 7.2(b)	--	Form of Certificate of Financial Officer
Exhibit 7.2(h)	--	Form of Borrowing Base Certificate

THIRD AMENDED AND RESTATED CREDIT AGREEMENT

    THIS THIRD AMENDED AND RESTATED CREDIT AGREEMENT (the "Third Amended and Restated Credit Agreement"), dated as of September 27, 2002, among BMC Industries, Inc., a Minnesota corporation ("Borrower"), the several banks and other financial institutions set forth on the signature pages hereto, DEUTSCHE BANK TRUST COMPANY AMERICAS (formerly named Bankers Trust Company), as administrative agent for the Lenders hereunder (in such capacity, the "Agent") and as a Lender, and Bank One, NA, as Documentation Agent and a Lender.

W I T N E S S E T H:

    WHEREAS, Borrower, Agent, the financial institutions party thereto and NBD Bank, as Documentation Agent, have entered into that certain Credit Agreement dated as of May 15, 1998 (the "Original Credit Agreement") providing for revolving credit facilities for working capital and other corporate purposes to Borrower as the same was amended and restated as of June 25, 1998 (as the same was previously amended prior to the date hereof, the "First Amended and Restated Credit Agreement");

    WHEREAS, Borrower, Agent, Documentation Agent and the financial institutions party thereto have entered into that certain amendment to the First Amended and Restated Credit Agreement dated as of October 12, 2001 (the "Second Amendment and Restatement Agreement");

    WHEREAS, the parties hereto wish to amend the First Amended and Restated Credit Agreement (as previously amended by the Second Amendment and Restatement Agreement) in the manner set forth in each corresponding or new section below to (i) convert the Term Loans outstanding thereunder into two new tranches of term loans; (ii) to permanently reduce the Revolving Commitment by $25,000,000 with the resulting Revolving Commitment on the Third Amended and Restated Effective Date being $35,000,000; and (iii) to extend the Termination Date and the maturity date of the Term Loans to May 14, 2004 and to make certain other modifications as set forth below;

    NOW, THEREFORE, in consideration of the premises and of the mutual covenants herein contained, the parties hereto agree that the First Amended and Restated Credit Agreement (as amended by the Second Amendment and Restatement Agreement) is hereby further amended by the modifications or additions in each corresponding or new section, schedule or exhibit set forth below:

ARTICLE I
 DEFINITIONS

    1.1    Defined Terms.  As used in this Agreement, the following terms shall have the following meanings, such meanings to be equally applicable to both the singular and plural forms of the terms defined:

     "Accounts Receivable" means presently existing and hereafter arising or acquired accounts receivable, notes, drafts, acceptances, choses in action and other forms of obligations and receivables relating in any way to Inventory or arising from the sale of Inventory (or goods previously sold that would be Inventory but for the fact that such goods have been sold)  or the rendering of services or the receipt of royalty payments by the Borrower or any of its Subsidiaries or howsoever otherwise arising, including the right to payment of any interest or finance charges with respect thereto and all proceeds of insurance with respect thereto, together with all of the Borrower's and such Subsidiaries' rights as an unpaid vendor, all pledged assets, guaranty claims, liens and security interests held by or granted to the Borrower or such Subsidiary to secure payment of any Accounts Receivable and all books, customer lists, ledgers, records and files (whether written or stored electronically) relating to any of the foregoing.

    "Acquisition": any transaction or series of related transactions for the purpose of or resulting, directly or indirectly, in (a) the acquisition of all or substantially all of the assets of a Person, or of any business or division of a Person, (b) the acquisition of in excess of 50% of the capital stock, partnership interests, membership interests or equity of any Person, or otherwise causing any Person to become a Subsidiary, or (c) a merger or consolidation or any other combination with another Person (other than a Person that is a Subsidiary) provided that the Borrower or the Subsidiary is the surviving entity.

 "Additional Security Documents": all mortgages, pledge agreements, security agreements and other security documents entered into pursuant to Section 7.12 and the Security Agreement.

"Adjusted Working Capital": the difference between (i) Consolidated Current Assets and (ii) Consolidated Current Liabilities excluding from Consolidated Current Liabilities all short-term borrowings, the current portion of long-term indebtedness and the current portion of Capitalized Lease Obligations.

"Adjustment Date": the earlier of (i) the second Business Day after receipt by Agent of the financial statements required to be delivered by Borrower pursuant to Section 7.1 and (ii) the date five days after notice from Agent to Borrower that Borrower has failed to deliver such financial statements; provided that if an Adjustment Date pursuant to clause (ii) occurs, the date which is the Second Business Day after Agent does receive such financial statements shall also be an Adjustment Date.

"Agent": as defined in the preamble.

"Agents": the Agent and the Documentation Agent.

"Affiliate": with respect to any Person, any Person or group acting in concert in respect of the Person in question that, directly or indirectly, controls or is controlled by or is under common control with such Person.  For the purposes of this definition, "control" (including, with correlative meanings, the terms "controlled by" and "under common control with") shall mean the possession, directly or indirectly, of the power to direct or cause the direction of management and policies of a Person, whether through the ownership of voting securities or by contract or otherwise.

"Agent‑Related Persons": as defined in Section 10.3.

"Aggregate Commitment": the sum of (a) the Total Revolving Commitment, and (b) the aggregate outstanding Term Loans of the Term Lenders.

"Aggregate Consideration": the aggregate value of all cash, securities and other property paid in connection with an Acquisition, including all Indebtedness of the acquired Person repaid or assumed, directly or indirectly (by operation of law or otherwise) in connection with the Acquisition.

"Aggregate Converted Term Loan Amount"  means the sum of the Converted Term Loan Amounts of all Converting Lenders on the Restatement Date.

"Agreement": this Agreement, as amended, supplemented or otherwise modified from time to time.

 "Applicable Commitment Fee": at any date, shall equal .750%.

"Applicable Margin": means (i) at any time prior to July 1, 2003, (a) 2.250% with respect to Revolving Loans and Term A Loans which are Base Rate Loans or Unpaid Drawings and 3.250% with respect to Revolving Loans and Term A Loans which are Eurodollar Loans; and (b) 4.750% with respect to Term B Loans which are Base Rate Loans and 5.750% with respect to Term B Loans which are Eurodollar Loans; and (ii) at any time on or after July 1, 2003, (a) 2.750% with respect to Revolving Loans and Term A Loans which are Base Rate Loans or Unpaid Drawings and 3.750% with respect to Revolving Loans and Term A Loans which are Eurodollar Loans; and (b) 5.250% with respect to Term B Loans which are Base Rate Loans and 6.250% with respect to Term B Loans which are Eurodollar Loans.

"Asset Acquisition": the purchase by Borrower of the assets of the Orcolite business unit, an operating division of the Monsanto Corporation in 1998.

"Asset Acquisition-Related and Other Special Charges": means charges taken in 1998 for accounting purposes in connection with the Asset Acquisition to reflect write-offs, costs, expenses or other charges related to the Asset Acquisition and other special non-recurring non cash accounting charges (provided that no more than $2,000,000 may be cash severance payments) in 1998 not to exceed $65,000,000 in the aggregate.

"Asset Disposition": any sale, lease, transfer or other disposition (or series of related sales, leases, transfers or dispositions) of shares of Capital Stock of a Subsidiary of Borrower (other than directors' qualifying shares), property or other assets (each referred to for the purposes of this definition as a "disposition") by Borrower or any of its Subsidiaries the fair market value of which, as determined in good faith by the board of directors of Borrower or such Subsidiary, as the case may be, exceeds $1,000,000 (other than (i) a disposition by a Subsidiary to Borrower or by Borrower or a Subsidiary to a Wholly-Owned Subsidiary, (ii) a disposition of property or other assets at fair market value in the ordinary course of business, including non-exclusive licenses to use trademarks, trade names or other similar property of Borrower or its Subsidiaries and (iii) a disposition of obsolete property or other assets in the ordinary course of business).

"Assignee": an Eligible Assignee which is an "Assignee" party to an Assignment and Assumption Agreement pursuant to Section 11.9.

"Assignment and Assumption Agreement": an Assignment and Assumption Agreement substantially in the form of Exhibit 11.9 annexed hereto and made a part hereof made by any applicable Lender, as assignor and such Lender's assignee in accordance with Section 11.9, with such modifications (including, without limitation, additional representations, warranties and covenants by the assignor Lender or assignee Lender) as such assignor Lender and assignee Lender may agree to from time to time which solely affect the relative rights and/or obligations of the assignor Lender and assignee Lender as between themselves.

"Attorney Costs": all reasonable fees and disbursements of any law firm or other external counsel and the reasonable allocated cost of internal legal services, including all reasonable disbursements of internal counsel.

"Attributable Debt": as of the date of determination thereof in connection with a Sale and Leaseback Transaction occurring after the Closing Date, the greater of (1) the fair value of the assets subject to such transaction (as determined in good faith by the applicable lessee) and (2) the present value (discounted according to GAAP at the cost of debt implied in the lease) of the obligations of the lessee for rental payments during the term of any applicable lease.

"Available Revolving Commitment": as to any Lender at any time, an amount in Dollars equal to the excess, if any, of (a) such Lender's Revolving Commitment over (b) the sum of (i) the aggregate principal amount then outstanding of Revolving Loans made by such Lender and (ii) such Lender's Commitment Percentage of the LC Obligations and Commitment Percentage of the Swing Line Loans then outstanding.

"Bankruptcy Code": Title 11 of the United States Code entitled Bankruptcy as now or hereafter in effect or any successor thereto.

"Base Rate": the higher of (i) the Prime Lending Rate and (ii) the Federal Funds Effective Rate plus one‑half of one percent (½½%).

"Base Rate Loans": Loans bearing interest at a rate determined by reference to the Base Rate, or Swing Line Loans, as the context shall require.

"Board": the Board of Governors of the Federal Reserve System (or any successor thereto).

"Borrower": as defined in the preamble.

"Borrower Security Agreement": as defined in Section 6.1(a)(iii).

"Borrowing": a group of Loans of a single Type made by the Lenders or the Swing Line Lender, as appropriate, on a single date and as to which a single Interest Period is in effect.

"Borrowing Base" means at any time the sum of (a) eighty-five percent (85%) of the outstanding amount of Eligible Receivables and (b) fifty-five percent (55%) of the value of Eligible Inventory, in each case as determined from the Borrowing Base Certificate most recently delivered and updated pursuant to subsection 7.2(h); provided, however, that the Borrowing Base shall be deemed to be no more than $30 million until delivery of the Field Audit.

 "Borrowing Base Certificate" has the meaning assigned to that term in subsection 7.2(h).

 "Business Day": a day other than a Saturday, Sunday or other day on which commercial banks in New York City are authorized or required by law to close; provided, however, that when used in connection with a Eurodollar Loan, the term "Business Day" shall also exclude any day on which banks are not open for dealings in dollar deposits in the London interbank market.

"Capital Expenditures": without duplication, with respect to any Person, any amounts expended or Indebtedness incurred during or in respect of a period for any purchase or other acquisition for value of any asset that should be classified on a consolidated balance sheet of such Person prepared in accordance with GAAP as a fixed or capital asset including, without limitation, the direct or indirect acquisition of such assets or improvements by way of increased product or service charges, offset items or otherwise, and shall include Capitalized Lease Obligations and shall include amounts expended, incurred or obligated to be expended during or in respect of a period for any Permitted Acquisition or Permitted Investment regardless of whether such Permitted Acquisition or Permitted Investment would be classified as fixed or capital assets on a consolidated balance sheet of such Person prepared in accordance with GAAP.

"Capital Lease": as applied to any Person, any lease of any property (whether real, personal or mixed) by that Person as lessee which would, in conformity with GAAP, be required to be accounted for as a capital lease on the balance sheet of that Person.

"Capital Stock": with respect to any Person, any and all shares, interests, participations, rights in or other equivalents (however designated) of such Person's capital stock, partnership interests, membership interests or other equivalent interests and any rights (other than debt securities convertible into or exchangeable for capital stock or such interests), warrants or options exchangeable for or convertible into such capital stock or other interests.

"Capitalized Lease Obligation": at the time any determination thereof is to be made, the amount of the liability in respect of a Capital Lease which would at such time be so required to be capitalized on such a balance sheet in accordance with GAAP.

"Cash": means money, currency or the available credit balance in a Deposit Account.

"Cash Equivalents": Investments of the type specified in clauses (i), (ii), (iii), (iv)  and (ix) of the definition of "Permitted Investments".

"Change of Control": (i) the sale, lease or transfer of all or substantially all of Borrower's assets to any Person or group (as such term is used in Section 13(d)(3) of the Exchange Act), (ii) the liquidation or dissolution of Borrower, (iii) any person or group of persons (within the meaning of the Exchange Act) acquiring beneficial ownership (within the meaning of Rule 13d-3 promulgated by the SEC under the Exchange Act) of 20% or more of the issued and outstanding shares of Borrower's Voting Securities; or (iv) a majority of the directors of the Borrower are Persons other than Persons (A) for whose election proxies have been solicited by Borrower's board of directors or (B) who are then serving as directors appointed by Borrower's board of directors to fill vacancies on the Board caused by death or resignation (but not by removal) or to fill new created directorships.

"Closing Date" May 15, 1998.

"Code": the Internal Revenue Code of 1986, as amended from time to time.

"Collateral" means all "Collateral" as defined in each of the Security Documents.

"Collateral Account": as defined in Section 4.3(a).

"Collateral Agent": the Agent acting as collateral agent for the Secured Creditors.

"Commercial Letter of Credit": means any letter of credit or similar instrument issued for the account of Borrower pursuant to this Agreement for the purpose of supporting trade obligations of Borrower or any of its Domestic Subsidiaries in the ordinary course of business.

 "Committed Loan": any Revolving Loan, Term Loan or Swing Line Loan.

"Commitment": as to any Lender at any time, the aggregate of such Lender's outstanding Revolving Commitment and its Swing Line Commitment.

"Commitment Percentage": means, as to any Lender, (a) in respect of a particular Loan and/or Commitment, (i) at any time at which the Commitments in respect of such Loan remain outstanding, the percentage equivalent (expressed as a decimal, rounded to the ninth decimal place) at such time of such Lender's Commitment in respect of such Loan divided by the combined Commitments in respect of such Loan; and (ii) after the termination of the Commitments in respect of such Loan or in respect of any Term Loan, the percentage equivalent (expressed as a decimal, rounded to the ninth decimal place) at such time of the principal amount outstanding of such Loans held by such Lender divided by the aggregate principal amount outstanding of such Loans held by all Lenders, and (b) in respect of all Loans and/or Commitments, (i) at any  time at which the Aggregate Commitments (or any portion thereof) remains outstanding, the percentage equivalent (expressed as a decimal, rounded to the ninth decimal place) at such time of the sum of such Lender's Revolving Commitments and such Lender's outstanding Term Loans divided by the Aggregate Commitment, and (ii) after the termination of the Revolving Commitments, the percentage equivalent (expressed as a decimal, rounded to the ninth decimal place) at such time of the principal amount of such Lender's outstanding Loans and LC Obligations divided by the aggregate principal amount of the outstanding Loans and LC Obligations of all of the Lenders. 

"Commitment Period": the period from and including the date hereof to but not including the Termination Date.

"Commodity Price Protection Agreement": any Contractual Obligation or other arrangement designed to protect Borrower or any of its Subsidiaries from fluctuations in the price of commodities.

 "Consolidated Capital Expenditures": for any period, the aggregate of all Capital Expenditures by Borrower and its Subsidiaries during that period that, in conformity with GAAP, are included in "additions to property, plant or equipment" or comparable items reflected in the consolidated statement of cash flows of Borrower and its Subsidiaries.

"Consolidated Current Assets": with respect to any Person, as at the time any determination thereof is to be made, the amount, without duplication, that is classified on a consolidated balance sheet of such Person and its Subsidiaries as the consolidated current assets of such Person and its Subsidiaries in accordance with GAAP.

"Consolidated Current Liabilities": with respect to any Person, as at the time any determination thereof is to be made,  any indebtedness (other than the Indebtedness hereunder) that is classified as consolidated current liabilities on a consolidated balance sheet of such Person and its Subsidiaries in accordance with GAAP.

"Consolidated Debt": indebtedness for money borrowed of Borrower and its Subsidiaries that should be shown as a liability on a consolidated balance sheet of Borrower and its Subsidiaries prepared in accordance with GAAP plus, without duplication, the amount of Indebtedness of the type described in clauses (iii), (v), (ix) and (x) of the definition thereof plus, without duplication, Attributable Debt.

"Consolidated EBITDA": without duplication for any Person for any period for which such amount is being determined, Consolidated Net Income or Consolidated Net Loss for such period minus Second Quarter 2001 Deferred Tax Charges for such period, if any, plus the sum of the amounts for such period of (i) Consolidated Interest Expense, (ii) provision for taxes based on income, (iii) depreciation expense, and (iv) amortization expense minus any non-cash non-operating income for such period to the extent included in Consolidated Net Income or Consolidated Net Loss and excluding any gain or loss recognized in respect of post-retirement benefits as a result of the application of FASB 106 and any foreign currency translation adjustments as a result of the application of FASB 52, all as determined on a consolidated basis for such Person and its consolidated Subsidiaries in accordance with GAAP.  For purpose of this definition, "Consolidated EBITDA" shall be calculated after giving effect on a pro forma basis to any Acquisition as if such Acquisition occurred on the first day of the applicable period on the same basis as is required in clauses (A) through (C) for the pro forma test under clause (iii) of the definition of Permitted Acquisition.

"Consolidated Interest Expense": with respect to any Person, for any period for which such amount is being determined, total interest expense of such Person and its Subsidiaries on a consolidated basis in accordance with GAAP for such period.

"Consolidated Net Income" and "Consolidated Net Loss": for any Person for any period for which such amount is being determined, the net income (loss) of such Person and its consolidated Subsidiaries during such period determined on a consolidated basis for such period taken as a single accounting period in accordance with GAAP, provided that in making such determination there shall be excluded any effect of (i) income (or loss) of any Person (other than a consolidated Subsidiary of such Person) in which any other Person (other than such Person or any of its consolidated Subsidiaries) has a joint interest, except to the extent of the amount of dividends or other distributions actually paid to such Person or any of its consolidated Subsidiaries by such other Person during such period, (ii) the income (or loss) of any Person accrued prior to the date it becomes a consolidated Subsidiary of such Person or is merged into or consolidated with such Person or any of its consolidated Subsidiaries or the Person's assets are acquired by such Person or any of its consolidated Subsidiaries, (iii) the income of any consolidated Subsidiary of such Person to the extent that the declaration or payment of dividends or similar distributions by that consolidated Subsidiary of the income is not at the time permitted by operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to that consolidated Subsidiary, (iv) Asset Acquisition-Related and Other Special Charges, (v) Third Quarter 2001 Non-Recurring Charges; (vi) Restructuring Charges; (vii) the Second Quarter 2001 Deferred Tax Charges; and (viii) to the extent deducted from determining Consolidated Net Income, any non-cash charge required as a result of the application of FASB 142.

"Consolidated Net Worth": of a Person means total stockholders' equity of such Person and its Subsidiaries on a consolidated basis in accordance with GAAP plus, without duplication, Asset Acquisition-Related and Other Special Charges plus, without duplication, the Second Quarter 2001 Deferred Tax Charges plus, without duplication, Third Quarter 2001 Non-Recurring Charges plus, without duplication, Restructuring Charges plus, without duplication and only to the extent deducted in the determination of stockholder's equity, any non-cash charge required as a result of the application of FASB 142; provided, however, notwithstanding anything in the definitions thereof to the contrary, Asset Acquisition-Related and Other Special Charges, Second Quarter 2001 Deferred Tax Charges, Third Quarter 2001 Non-Recurring Charges and Restructuring Charges shall be considered in calculating Consolidated Net Worth for purposes of Section 8.1(a) on an ongoing basis without duplication and only to the extent previously deducted in the determination of stockholder's equity.

"Contaminant": any material with respect to which any Environmental Law imposes a duty or obligation, including without limitation any pollutant, contaminant (as those terms are defined in 42 U.S.C. §9601(33)), toxic pollutant (as that term is defined in 33 U.S.C. §1362(13)), hazardous substance (as that term is defined in 42 U.S.C. §9601(14)), hazardous chemical (as that term is defined by 29 CFR § 1910.1200(c)), hazardous waste (as that term is defined in 42 U.S.C. § 6903(5)), or any state or local equivalent of such laws and regulations, including, without limitation, radioactive material, special waste, polychlorinated biphenyls, asbestos, petroleum, including crude oil or any petroleum-derived substance, (or any fraction thereof), waste, or breakdown or decomposition product thereof, or any constituent of any such substance or waste, including but not limited to polychlorinated biphenyls and asbestos.

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

"Converted Term Loan Amount": as defined in Section 2.1(a)(i).

"Converting Lender" means each Lender which executed the Second Amendment and Restatement Agreement on or before the Restatement Date and each Lender who delivered a Term Loan Conversion Notice to the Agent on or before the Restatement Date.

"Cortland Mortgage": the form of Cortland Mortgage attached hereto as Exhibit 6.2(a)(vi) covering the Cortland, New York property of the Borrower as amended, restated, supplemented or otherwise modified from time to time.

"Cortland Mortgage Policy": any mortgage insurance policies, "marked up" mortgage title insurance commitment, items described in Exhibit 6.2(a)(vi)(ii) hereto or similar documents delivered pursuant to Section 5.19(b).

"Credit Event": the making of any Loan or the issuance of any Letter of Credit.

"Credit Party": Borrower, each Subsidiary Guarantor and any guarantor which may hereafter enter into a guarantee agreement with respect to the Obligations.

"Currency Protection Agreement": any foreign exchange contract, currency swap agreement, or other financial agreement or arrangement to which Borrower or any of its Subsidiaries is a party that is designed to protect Borrower or any of its Subsidiaries against fluctuations in currency values.

"DBTCA": Deutsche Bank Trust Company Americas (formerly named Bankers Trust Company).

"Debts": all liabilities, whether matured or unmatured, liquidated or unliquidated, absolute, fixed or contingent.

"Default Rate": a variable rate per annum which shall be two percent (2%) per annum plus either (i) the then applicable interest rate hereunder in respect of the amount on which the Default Rate is being assessed, or (ii) if there is no such applicable interest rate, the Base Rate plus the Applicable Margin, but in no event in excess of that permitted by applicable law.

"Defaulting Lender": any Lender with respect to which a Lender Default is in effect.

"Deposit Account" means any account held by a Person at a bank or other financial institution into which such Person deposits cash, checks, drafts or other similar items of payment relating to or constituting payments made in respect of any and all Collateral.

"Documents": the Loan Documents.

"Dollars" and "$": dollars in lawful currency of the U.S.

 "Domestic Subsidiary": any Subsidiary of Borrower that is not a Foreign Subsidiary.

"Drawing": as defined in Section 2.9(d)(ii).

"Effective Date": the effective date of the applicable Assignment and Assumption Agreement, as defined therein.

 "Eligible Assignee": (i) a commercial bank organized under the laws of the U.S., or any State thereof, (ii) a commercial bank organized under the laws of any other country which is a member of OECD, or a political subdivision of any such country; provided, however, that such bank is acting through a branch or agency located in the country in which it is organized or another country which is also a member of the OECD or the Cayman Islands, (iii) the central bank of any country which is a member of the OECD, (iv) a finance company or other financial institution or fund (whether a corporation, partnership, trust or other entity) that is engaged in making, purchasing or otherwise investing in commercial loans in the ordinary course of its business, (v) an insurance company organized under the laws of the U.S. (or any State thereof), (vi) a savings bank or savings and loan association organized under the laws of the U.S., or any State thereof, (vii) any Lender party to this Agreement, (viii) any Affiliate of any Lender party to this Agreement, and (ix) any other Person approved by Agent and Borrower, such approval not to be unreasonably withheld; provided, however, that an affiliate of Borrower shall not qualify as an Eligible Assignee.

"Eligible Inventory" means the Inventory of the Borrower and its Domestic Subsidiaries (valued at the lower of cost (determined on a first-in-first-out basis) or market) located in the continental United States as to which (a) the Borrower or a Domestic Subsidiary of the Borrower has acquired title, (b) the Collateral Agent has a first (subject only to statutory or common law non-consensual Liens constituting Permitted Liens) and perfected security interest and (c) such Person shall have furnished to the Agent information adequate for purposes of identification at times and in form and substance as may be reasonably requested by the Agent; provided, however, that such Inventory shall not constitute Eligible Inventory (i) if and when the Borrower or such Subsidiary sells it, otherwise passes title thereto or consumes it, (ii) if the Collateral Agent releases its security interest therein, or (iii) to the extent that it (A) is obsolete, not in good condition or not either currently useable or currently salable in the ordinary course of the Borrower's or such Subsidiary's business, (B) is produced in violation of the Fair Labor Standards Act and subject to the so-called "hot goods" provision contained in Title 29, §215(a) (1) of the United States Code, (C) is Inventory consisting of packaging material or supplies, (D) is Inventory consisting of work in progress, (E) is Inventory held for consumption (other than raw materials) by the Borrower or such Subsidiary and not for sale or lease in the ordinary course of business, (F) is Inventory which is subject to a Lien in favor of any Person other than the Collateral Agent (other than statutory or common law non-consensual Liens constituting Permitted Liens), (G) constitutes Inventory which is not located either (i) on the Borrower's or such Subsidiary's owned premises in the United States of America, (ii) on any leased premises in the United States of America provided that on any date occurring sixty days or more following the Third Amended and Restated Effective Date, Inventory under this subclause (G)(ii) shall, subject to the other provisions of this definition, constitute Eligible Inventory only in the event the same exists on leased premises in the United States of America where the landlord thereof has consented in writing to the Collateral Agent's prior Lien in such Inventory and the Collateral Agent's right to enter such premises and take possession and remove such Inventory pursuant to a landlord access and lien waiver in form and substance reasonably satisfactory to the Agent or (iii) in warehouses or with bailees in the United States of America where the warehousemen or bailee has consented in writing to the Collateral Agent's prior Lien in such Inventory and the Collateral Agent's right to enter such premises and take possession of and remove such Inventory, pursuant to an access and lien waiver in form and substance satisfactory to the Administrative Agent, (H) constitutes Inventory which is evidenced by an Eligible Receivable, or (I) is Inventory which is not in full conformity with the representations made by the Borrower and the Borrower's Subsidiaries with respect thereto in this Agreement or the Security Documents; provided, further, that nothing in the preceding clauses (F) or (G) shall exclude any Inventory from the definition of Eligible Inventory to the extent such Inventory would otherwise be considered Eligible Inventory hereunder (excluding the effect of such clauses (F) and (G)) and is Inventory consigned for sale by the Borrower or one of its Domestic Subsidiaries to a third party for which the Borrower or such Domestic Subsidiary has taken all steps reasonably required by the Collateral Agent to perfect Collateral Agent's security interest in such consigned Inventory (including without limitation completing all filings and notices required by Section 9-324 of the Uniform Commercial Code required to protect the Borrower's or such Domestic Subsidiary's interest in such consigned Inventory against lenders of the applicable consignee).  Any Inventory which is Eligible Inventory at any time, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be Eligible Inventory until such time as it once again meets all of the foregoing requirements.

"Eligible Receivables" means the Accounts Receivable of the Borrower and its Domestic Subsidiaries located in the continental United States as to which (a) the Collateral Agent has a first (subject only to statutory or common law non-consensual Liens constituting Permitted Liens) perfected security interest and (b) the Borrower shall have furnished to the Agent information adequate for purposes of identification at times and in form and substance as may be reasonably requested by the Agent; provided, however, that such Accounts Receivable shall not constitute Eligible Receivables if they (i) by their terms are not payable within ninety (90) days after the date of the applicable invoice with respect to shipped goods or they remain unpaid ninety (90) days after the original date of the applicable invoice; (ii) are Accounts Receivable owing by a single Accounts Receivable debtor in the event that fifty percent (50%) or more of the balance of Accounts Receivable owing by such Accounts Receivable debtor is ineligible by reason of the criteria set forth in clause (i) immediately preceding; (iii) are Accounts Receivable with respect to which the Accounts Receivable debtor is an Affiliate of the Borrower or such Subsidiary or a director, officer of employee of the Borrower or of such Subsidiary or such Affiliates; (iv) are Accounts Receivable with respect to which the Accounts Receivable debtor is not a resident of the United States of America other than such foreign account receivable secured by letters of credit or sight drafts reasonably acceptable to the Agent; provided that such letter of credit or sight draft is delivered and pledged to the Collateral Agent as additional Collateral; (v) are Accounts Receivable arising with respect to goods which have not been shipped or arising with respect to services which have not been fully performed; (vi) are Accounts Receivable which are not invoiced (and dated as of the date of such invoice) and sent to the Accounts Receivable debtor within a reasonable time consistent with reasonable business practices; (vii) are Accounts Receivable with respect to which the Borrower knows, or should reasonably know, that the Accounts Receivable debtor is the subject of a bankruptcy or a similar insolvency proceeding or has made an assignment for the benefit of creditors or whose assets have been conveyed to a receiver or trustee other than Accounts Receivable of such debtor arising after an order for relief has been entered in a case under Title 11 of the United States Code to the extent the payment of such Accounts Receivable has been approved in such case; (viii) are Accounts Receivable with respect to sales made on a bill-and-hold, guaranteed sale, sale-and-return, sale on approval, consignment or similar basis; (ix) are Accounts Receivable which are or may reasonably be expected to become subject to any right of setoff by the Accounts Receivable debtor but only (A) to the extent of such right of setoff and (B) if such Accounts Receivable debtor has not entered into an agreement with the Agent which is acceptable to the Agent with respect to the wavier of rights of setoff; or (x) are not in conformity with the representations and warranties made by the Borrower and the Borrower's  Subsidiaries with respect thereto in this Agreement or any Security Document; provided, further, that such Accounts Receivable which fail to meet any of the foregoing requirements shall be excluded from the calculation of Eligible Receivables without duplication.  Any Account Receivable which is at any time an Eligible Receivable, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Receivable until such time as it once again meets all of the foregoing requirements.

"Environmental Laws": any and all foreign, Federal, state, local or municipal laws, rules, orders, regulations, statutes, ordinances, codes or decrees of any Governmental Authority or other Requirements of Law regulating, relating to or imposing liability or standards of conduct concerning protection of human health or the environment, as now or may at any time hereafter be in effect that are applicable to the Borrower or its Subsidiaries.

"ERISA": the Employee Retirement Income Security Act of 1974, as amended from time to time.

"ERISA Affiliate": each trade or business (whether or not incorporated) which together with Borrower or a Subsidiary of Borrower would be deemed to be a "single employer" within the meaning of Section 4001(b)(1) of ERISA or would be included in a "controlled group of corporations," a group of "trades or businesses under common control" or an "affiliated service group" within the meaning of Section 414(b), (c), (m) or (o) of the Code.  Unless otherwise qualified, all references to an "ERISA Affiliate" in this Agreement shall refer to an ERISA Affiliate of Borrower or any Subsidiary.

"Eurocurrency Reserve Requirements": for any day as applied to a Eurodollar Loan, the aggregate (without duplication) of the maximum rates (expressed as a decimal fraction) of reserve requirements in effect on such day (including, without limitation, basic, supplemental, marginal and emergency reserves under any regulations of the Board or other Governmental Authority having jurisdiction with respect thereto) dealing with reserve requirements prescribed for Eurocurrency funding (currently referred to as "Eurocurrency liabilities" in Regulation D of such Board) maintained by a member bank of the Federal Reserve System.

"Eurodollar Borrowing": a Borrowing comprised of Eurodollar Loans.

"Eurodollar Loan": any Loan bearing interest at a rate determined by reference to the Eurodollar Rate.

"Eurodollar Rate": the arithmetic average (rounded upwards to the nearest 1/16 of 1%) of the offered quotations, if any, to first class banks in the Eurodollar market by DBTCA for Dollar deposits of amounts in immediately available funds comparable to the principal amount of the applicable Eurodollar Loan for which the Eurodollar Rate is being determined with maturities comparable to the Interest Period for which such Eurodollar Rate will apply, as of approximately 10:00 A.M. (New York City time) on the applicable Interest Rate Determination Date.  The determination of the Eurodollar Rate by Agent shall be conclusive and binding on Borrower absent demonstrable error.

"Eurodollar Reserve Rate": with respect to each day during each Interest Period pertaining to a Eurodollar Loan, a rate per annum determined for such day in accordance with the following formula (rounded upward to the nearest 1/100th of 1%):

                   Eurodollar Rate                                   
1.00 ‑ Eurocurrency Reserve Requirements

"European Reorganization" has the meaning assigned to that term in that certain Consent, Waiver and Fourth Amendment to Credit Agreement dated as of December 21, 1999 by and among the Borrower, the Agent and the Lenders signatory thereto.

"Event of Default": any of the events specified in Section 9.1; provided, however, that any requirement for the giving of notice, the lapse of time, or both, or any other condition, has been satisfied.

"Excess Cash Flow": for any period, the excess of (i) the sum of (without duplication) (A) Consolidated Net Income for such period, plus (B) the amount of all non-cash charges (including, without limitation or duplication, depreciation, amortization and non-cash (including without limitation any original issue discount or pay-in-kind interest expense) interest expense) included in determining Consolidated Net Income for such period, plus (C) the decrease, if any, in Adjusted Working Capital from the first day to the last day of such period, plus (D) provisions for taxes appearing on an income statement of Borrower and its Subsidiaries for such period, over (ii) the sum (without duplication) of (A) any non-cash credits (including from sales of assets) included in determining Consolidated Net Income for such period, plus (B) gains from sales of assets included in determining Consolidated Net Income for such period, plus (C) the aggregate amount of Capital Expenditures (excluding Capital Expenditures made utilizing insurance proceeds from Recovery Events or financed through Indebtedness (other than Indebtedness under this Agreement)), plus (D) the aggregate principal amount of permanent principal payments of Indebtedness for borrowed money of Borrower and its Subsidiaries (other than (1) repayment of Indebtedness with proceeds of issuance of other Indebtedness or equity or equity contributions or with Net Sale Proceeds or Recovery Events and (2) repayment of Loans, provided that repayments of Loans shall be deducted in determining Excess Cash Flow if such repayments were (x) required as a result of a Scheduled Term Repayments under Section 4.4(e) or were repayments of Loans on the Termination Date, (y) made as a voluntary prepayment with internally generated funds (but in the case of a voluntary prepayment of Revolving Loans or Swing Line Loans, only to the extent accompanied by a voluntary permanent reduction to the Total Revolving Commitment) or (z) made with Net Sale Proceeds from any Asset Disposition but only to the extent that any gain from such Asset Disposition has been included in the determination of Consolidated Net Income for such period) during such period, plus (E) non-cash charges added back in a previous period pursuant to clause (i)(B) above to the extent any such charge has become a cash item in the current period, plus (F) the increase, if any, in Adjusted Working Capital from the first day to the last day of such period, plus (G) taxes paid by Borrower and its Subsidiaries during such period, plus (H) the principal portion of Capitalized Lease Obligations paid by Borrower and its Subsidiaries during such period.

"Excess Cash Flow Period": with respect to the repayment required on each Excess Cash Payment Date, the immediately preceding Fiscal Year of Borrower; provided, however, that with respect to the Fiscal Year ended December 31, 2002, there shall be used in determining Excess Cash Flow for such Fiscal Year only the period between the Third Amended and Restated Effective Date and December 31, 2002.

 "Excess Cash Payment Date": the date occurring 95 days after the last day of a Fiscal Year of Borrower (beginning with its Fiscal Year ending on December 31, 2002).

"Exchange Act": the Securities Exchange Act of 1934, as amended and codified in U.S.C. 78a et seq. and as hereafter amended from time to time.

"Exchangeable Stock": any Capital Stock which is exchangeable or convertible into another security (other than Capital Stock of Borrower which is neither Exchangeable Stock nor Redeemable Stock).

"Existing Credit Agreements": that certain Credit Agreement among BMC Industries, Inc., various Banks and Norwest Bank Minnesota, National Association, dated June 5, 1996, as amended to date, and all agreements relating to such loan agreement, including, without limitation, any and all guarantees, pledge agreements and security agreements.

 "Facility": any of the credit facilities established under this Agreement.

"Facing Agent": means (i) for Standby Letters of Credit, DBTCA and (ii) for Commercial Letters of Credit any Revolving Lender, other than DBTCA, which at the request of the Borrower and with the written approval of the Agent, agrees to issue Commercial Letters of Credit.

"Federal Funds Effective Rate": for any period, a fluctuating interest rate per annum equal for each day during such period to 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 for such day (or, if such day is not a Business Day, for the next preceding 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 DBTCA, as Agent, from three Federal funds brokers of recognized standing selected by it.

"Field Audit": as defined in Section 7.15.

"Financial Officer": with respect to any Person, the chief financial officer, principal accounting officer, a financial vice president, treasurer or assistant treasurer of such Person.

"Foreign Subsidiary": a Subsidiary of Borrower that is incorporated under the laws of a jurisdiction other than any State of the U.S. or the District of Columbia.

"GAAP": generally accepted accounting principles in the U.S. as in effect from time to time.  If any changes in GAAP or the application thereof from that used in the preparation of the financial statements referred to in Section 7.1(a) hereof occur after the Closing Date and such changes result in a material change in the calculation of any financial covenants or restrictions set forth in this Agreement, then the parties hereto agree to enter into and diligently pursue negotiations in order to amend such financial covenants and restrictions so as to equitably reflect such changes, with the desired result that the criteria for evaluating the financial condition and results of operations of Borrower and its Subsidiaries shall be the same after such changes as if such changes had not been made.

"Governmental Authority": any nation or government, any state or other political subdivision thereof and any entity exercising executive, legislative, judicial, regulatory or administrative functions of government.

"Guarantee Obligations": as to any Person, without duplication, any direct or indirect obligation of such Person guaranteeing or intended to guarantee any Indebtedness, Capital Lease or operating lease, dividend or other obligation ("primary obligations") of any other Person (the "primary obligor") in any manner, whether directly or indirectly, including, without limitation, any obligation of such Person, whether or not contingent:  (i) to purchase any such primary obligation or any property constituting direct or indirect security therefor; (ii) to advance or supply funds (a) for the purchase or payment of any such primary obligation, or (b) to maintain working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency of the primary obligor; (iii) to purchase property, securities or services primarily for the purpose of assuring the owner of any such primary obligation of the ability of the primary obligor to make payment of such primary obligation; or (iv) otherwise to assure or hold harmless the owner of such primary obligation against loss in respect thereof; provided, however, that the term Guarantee Obligation shall not include any endorsements of instruments for deposit or collection in the ordinary course of business.  The amount of any Guarantee Obligation of any Person at any time shall be deemed to be an amount equal to the lesser at such time of (y) the stated or determinable amount of the primary obligation in respect of which such Guarantee Obligation is made or (z) the maximum amount for which such Person may be liable pursuant to the terms of the instrument embodying such Guarantee Obligation; or, if not stated or determinable, the maximum reasonably anticipated liability (assuming full performance) in respect thereof.     

"Indebtedness": as applied to any Person (without duplication):

(i)     all indebtedness of such Person for borrowed money;

(ii)     the deferred and unpaid balance of the purchase price of assets or services (other than trade payables and other accrued liabilities incurred in the ordinary course of business that are not overdue by more than 90 days unless being contested in good faith) which purchase price is (y) due more than six months from the date of incurrence of the obligation in respect thereof or (z) evidenced by a note or a similar written instrument;

(iii)    that portion of obligations of such Person with respect to Capital Leases which is required to be classified as a liability on a balance sheet in accordance with GAAP;

(iv)    all indebtedness secured by any Lien on any property owned by such Person, whether or not such indebtedness has been assumed by such Person or is nonrecourse to such Person;

(v)     notes payable and drafts accepted representing extensions of credit whether or not representing obligations for borrowed money (other than such notes or drafts for the deferred purchase price of assets or services which does not constitute Indebtedness pursuant to clause (ii) above);

(vi)    indebtedness or obligations of such Person, in each case, evidenced by bonds, notes or similar written instrument;

(vii)    the face amount of all letters of credit and bankers' acceptances issued for the account of such Person, and without duplication, all drafts drawn thereunder other than, in each case, commercial or standby letters of credit or the functional equivalent thereof issued in connection with performance, bid or advance payment obligations incurred in the ordinary course of business, including, without limitation, performance requirements  under workers compensation or similar laws;

(viii)    all obligations of such Person under Interest Rate Protection Agreements or Currency Protection Agreements;

(ix)    Guarantee Obligations of such Person; and

(x)     the principal balance outstanding under any synthetic lease, tax retention operation lease, off-balance sheet loan or similar off-balance sheet financing product to which such Person is a party, where such transaction is considered borrowed money indebtedness for tax purposes but is classified as an operating lease in accordance with GAAP.

"Insolvent": with respect to any Person, that the present fair saleable value of the assets of such Person is less than the amount that will be required to pay the probable liability on existing Debts of such Person or such Person is unable to pay its Debts, as such Debts become absolute and matured.

"Intellectual Property": as defined in Section 5.13.

"Intercompany Indebtedness": Indebtedness of Borrower or any of its Subsidiaries which, in the case of Borrower, is owing to any such Subsidiary and which, in the case of any Subsidiary of Borrower, is owing to Borrower or any of its other Subsidiaries.

"Interest Payment Date": (a)  as to any Base Rate Loan, the last Business Day of each March, June, September and December to occur while such Loan is outstanding and the date on which all of the Loans hereunder are paid in full, (b) as to any Eurodollar Loan, the last day of the Interest Period applicable thereto and (c) as to any Eurodollar Loan having an Interest Period longer than three months, each day which is three months after the first day of the Interest Period applicable thereto; provided, however, that, in addition to the foregoing, each of (x) the date upon which the Commitments have been terminated and the Loans have been paid in full and (y) the Termination Date shall be deemed to be an "Interest Payment Date" with respect to any interest which is then accrued hereunder.

"Interest Period": as defined in Section 3.4.

"Interest Rate Determination Date": the date for calculating the Eurodollar Rate for an Interest Period, which date shall be the second Business Day prior to the first day of the related Interest Period for such Eurodollar Loan.

"Interest Rate Protection Agreement": any interest rate swap agreement, interest rate cap agreement or other financial agreement or arrangement designed to protect Borrower or any of its Subsidiaries against fluctuations in interest rates.

"Inventory" means, with respect to the Borrower and its Subsidiaries, inclusively, all goods, merchandise and other personal property wherever located, now owned or hereafter acquired by the Borrower or any of its Subsidiaries of every kind or description which are held for sale or lease or are furnished or to be furnished under a contract of service or are raw materials, work-in-process or materials used or consumed or to be used or consumed in the Borrower's or any of its Subsidiaries' business.

"Investment": as applied to any Person, any direct or indirect purchase or other acquisition for value by that Person of stock or other securities of any other Person (or a beneficial interest therein), or a capital contribution by that Person to any other Person, or any direct or indirect loan or advance to any other Person, or any purchase by that Person of all or a significant part of the assets of a business conducted by another Person or any purchase by that Person of a futures contract or such person otherwise becoming liable for the purchase or sale of currency or other commodity at a future date in the nature of a futures contract.  The amount of any Investment by any Person shall be the original Investment (including the amount of any liability assumed to the extent that such liability would be reflected on a balance sheet prepared in accordance with GAAP) plus the cost of all additions thereto, without any adjustments for increases or decreases in value, or write-ups, write-downs or write-offs with respect to such Investment.

"IRS": the United States Internal Revenue Service, or any successor or analogous U.S. Governmental Authority.

"Landlord Consent" means a letter in favor of Agent and the Lenders which is executed by each lessor of any material leased facility of Borrower or any Subsidiary of Borrower at which Collateral may now or in the future be located, in form and substance reasonably satisfactory to the Agent and consistent with the standards outlined in subclause(G)(ii) of the definition of Eligible Inventory.

 "LC Commission": as defined in Section 2.9(e)(ii).

"LC Obligations": at any time, an amount equal to the sum of (a) the aggregate Stated Amount of the then outstanding Letters of Credit and (b) the aggregate amount of Unpaid Drawings (in each case without duplication).  The LC Obligation of any Lender at any time shall mean its Pro Rata Share of the aggregate LC Obligations outstanding at such time.

"LC Participant": as defined in Section 2.9(e).

"LC Supportable Indebtedness": (i) obligations of Borrower or its Subsidiaries incurred in the ordinary course of business with respect to insurance obligations and workers' compensation, surety bonds and other similar statutory obligations and (ii) such other obligations of Borrower or any of its Subsidiaries as are reasonably acceptable to Agent and the respective Facing Agent and otherwise permitted to exist pursuant to the terms of this Agreement.

"Lender Default": (i) the refusal (which has not been retracted) of a Lender to meet its obligation to make available its portion of any Borrowing or to fund its portion of any unreimbursed payment under Section 2.1(b)or (ii) a Lender having notified in writing Borrower and/or Agent that it does not intend to comply with its obligations under Section 2.1 (whether or not as a result of any takeover of such Lender by any regulatory authority or agency).

"Lenders": means those financial institutions from time to time party to the Agreement.

"Lending Office": with respect to each Lender, the office specified on such Lender's signature page or in the applicable Assignment and Assumption Agreement with respect to each Type of Loan, or such other office as such Lender may designate in writing from time to time to Borrower and Agent with respect thereto.

"Letter of Credit": means any Standby Letter of Credit or Commercial Letter of Credit issued by a Facing Agent hereunder, and any amendments thereto or replacements thereof, pursuant to Section 2.9.

"Letter of Credit Payment": as applicable (a) all payments made by the Facing Agent pursuant to either a draft or demand for payment under a Letter of Credit or (b) all payments made by the Lenders to the Facing Agent in respect thereof.

"Letter of Credit Request": as defined in Section 2.9(c).

"Lien": any judgment lien or execution, attachment, levy, distraint or similar legal process and any mortgage, pledge, security interest, encumbrance, lien, charge or deposit arrangement (other than a deposit in the ordinary course of business and not intended as security) of any kind (including, without limitation, any conditional sale or other title retention agreement or lease in the nature thereof, any sale of receivables with recourse (in whole or in part) against the seller or any other Person except the account debtors, any filing or agreement to file a financing statement as debtor under the UCC or any similar statute other than to reflect ownership by a third party of property leased to Borrower or any of its Subsidiaries under a lease which is not in the nature of a conditional sale or title retention agreement, or any subordination arrangement in favor of another Person).

"Liquidity": as of any date of determination, all cash and Cash Equivalents of the Borrower (determined on a consolidated basis) plus the Total Available Revolving Commitments.

"Loan": a Revolving Loan, Term Loan or a Swing Line Loan, as the context shall require; collectively, the "Loans."

"Loan Documents": this Agreement, the Notes, each Letter of Credit, each Security Document and any other instruments, documents and agreements delivered to Agent in favor of the Lenders or for the benefit of the Lenders.

"Majority Lenders" of any Facility means those Non-Defaulting Lenders which would constitute the Required Lenders under, and as defined in, this Agreement if all outstanding Obligations of other Facilities under this Agreement were repaid in full and all Commitments with respect thereto were terminated.

 "Material Adverse Effect": a material adverse effect on (a) the business, condition (financial or otherwise), assets, liabilities, property or operations of Borrower and its Subsidiaries taken as a whole, (b) the ability of Borrower or any Subsidiary to perform its obligations under any Loan Document to which it is a party, or (c) the validity or enforceability of this Agreement, any Note, any Security Document or the material rights or remedies of Agent and the Lenders hereunder or thereunder.

"Material Asset Disposition": any Asset Disposition of all or any substantial part of the assets of Borrower and its Subsidiaries, taken as a whole, to any Person (other than Borrower or any of its Subsidiaries).  For purposes of this definition, any subsidiary or the assets of a business operation which, in each case, if separately counted would constitute a "significant subsidiary" within the meaning of Rule 1-02 of Regulation S-X promulgated by the United States Securities and Exchange Commission shall be deemed to constitute a "substantial part of the assets" of such Borrower and its Subsidiaries, taken as a whole.

"Material Subsidiary": a Subsidiary, including its subsidiaries, which meets any of the following conditions:

(i)     the Borrower's and its Subsidiaries' advances to and other investments in the Subsidiary exceed 10 percent of the total assets of the Borrower and its Subsidiaries consolidated as of the end of the most recently completed fiscal year; or

(ii)     the Borrower's and its other Subsidiaries' proportionate share of the total assets (after intercompany eliminations) of the Subsidiary exceeds 10 percent of the total assets of the Borrower and its Subsidiaries consolidated as of the end of the most recently completed fiscal year; or

(iii)     the EBITDA of the Subsidiary exceeds 10 percent of the EBITDA of the Borrower and its Subsidiaries consolidated for the most recently completed fiscal year.

"Minimum Borrowing Amount": with respect to Base Rate Loans, $5,000,000, and with respect to Eurodollar Loans, $5,000,000, and with respect to Swing Line Loans, $1,000,000.

"Modification": as defined in Section 11.1.

"Moody's": Moody's Investors Service, Inc. or any successor to the rating agency business thereof.

 "Mortgaged Property": any real property subject to the Mortgages pursuant to Section 5.19(b) or 7.12.

"Mortgage" means individually and collectively, the Ramsey Mortgage, the Cortland Mortgage and any mortgages or similar documents executed pursuant to Section 7.12, all as amended, restated, supplemented or otherwise modified from time to time.

"Mortgage Policies" means any mortgage insurance policies, "marked up" mortgage title insurance commitment, items described in Exhibits 6.1(a)(vi)(ii) or 6.2(a)(vi)(ii) hereto or similar documents delivered pursuant to Sections 5.19(a), 5.19(b) or 7.12.

 "Most Recent Ratio of Consolidated Debt to Consolidated EBITDA": at any date, the ratio of Consolidated Debt as of the end of the most recently ended fiscal quarter of Borrower for which financial statements have been delivered pursuant to Section 7.1 (after giving effect to all payments made on or before such date) to Consolidated EBITDA for the period of four consecutive fiscal quarters ending on the last day of the most recently ended fiscal quarter of Borrower for which financial statements have been delivered pursuant to Section 7.1; provided, however, that on the date of any Acquisition, the "Most Recent Ratio of Consolidated Debt to Consolidated EBITDA" shall be recalculated effective until the date of delivery of the next quarterly financial statements as the ratio of Consolidated Debt as of the date of any such Acquisition (and after giving effect to any Indebtedness incurred or assumed in connection therewith) to Consolidated EBITDA for the four fiscal quarter period ending as of the most recently ended fiscal quarter for which financial statements have been delivered pursuant to Section 7.1 (calculated on a pro forma basis as set forth in the definition of Consolidated EBITDA after giving effect to the Acquisition); provided, further, however, that if Borrower fails to deliver such financial statements as required by Article VII and further fails to remedy such default within five days of notice thereof from Agent, then, without prejudice to any other rights of any Lender hereunder, the Most Recent Ratio of Consolidated Debt to Consolidated EBITDA" shall be deemed to be greater than 3.50 to 1.0 as of the date such financial statements were required to be delivered under Section 7.1.

"Multiemployer Plan": any plan described in Section 4001(a)(3) of ERISA to which contributions are or, within the immediately preceding six years, have been made or required by Borrower or any of its Subsidiaries or ERISA Affiliates.

"Net Offering Proceeds": the proceeds received from (a) the issuance of any Capital Stock or (b) the incurrence of any Indebtedness net of the actual liabilities for reasonably anticipated cash taxes in connection with such issuance or incurrence, if any, any underwriting, brokerage and other customary selling commissions incurred in connection with such issuance or incurrence, and reasonable legal, advisory and other fees and expenses, including title and recording tax expenses, if any, incurred in connection with such issuance or incurrence.

"Net Sale Proceeds": means the aggregate cash proceeds received from any Asset Disposition (including, without limitation, cash received by way of deferred payment pursuant to a note receivable, conversion of non-cash consideration, cash payments in respect of purchase price adjustments or otherwise, but only as and when such cash is received) by Borrower or any Subsidiary minus the reasonable costs and expenses incurred in connection therewith and any provision for taxes in respect thereof made in accordance with GAAP.

"New Domestic Subsidiary": as defined in Section 7.12(a).

"Non-Convertible Capital Stock": with respect to any corporation, any non-convertible Capital Stock of such corporation and any Capital Stock of such corporation convertible solely into non-convertible common stock of such corporation; provided, however, that Non-Convertible Capital Stock shall not include any Redeemable Stock or Exchangeable Stock.

"Non-Defaulting Lender": each Lender which is not a Defaulting Lender.

"Notes": respectively (i) individually, each Revolving Note, Term A Note, Term B Note or Swing Line Note and (ii) collectively, all Revolving Notes, all Term Notes and all Swing Line Notes.

"Notice of Borrowing": as defined in Section 2.5.

"Notice of Conversion or Continuation": as defined in Section 2.6.

"Obligations": all Loans and other Indebtedness, advances, debts, liabilities, obligations, covenants and duties owing by any Credit Party to any Lender, any Agent or any other Person required to be indemnified under any Loan Document, of any kind or nature, present or future, whether or not evidenced by any note, guaranty or other instrument, arising under this Agreement or under any other Loan Document, whether or not for the payment of money, whether arising by reason of an extension of credit, loan, guaranty, indemnification or in any other manner, whether direct or indirect (including those acquired by assignment), absolute or contingent, due or to become due, now existing or hereafter arising and however acquired.

"OECD": the Organization for Economic Cooperation and Development.

"Operating Account" means any account held at a bank or other financial institution out of which a Person disburses funds for the purpose of conducting the business of such Person.

"Original Credit Agreement": has the meaning assigned to that term in the recitals hereto.

"Original Term Loan Lender" as defined in Section 2.1(a)(ii).

"Original Term Loans" as defined in Section 2.1(a)(i).

"Payment Office": the address for such payments for such Loans set forth on Schedule 11.3 hereto in relation to Agent, or such other address as Agent may from time to time specify in accordance with Section 11.3.

"PBGC": the Pension Benefit Guaranty Corporation created by Section 4002(a) of ERISA or any successor thereto.

 "Permitted Acquisition": any Acquisition where the Person acquired is a Wholly-Owned Subsidiary or the assets acquired are owned by Borrower or a Wholly-Owned Subsidiary and where (i) the Person acquired becomes a Credit Party or the assets acquired are owned by a Credit Party and the Aggregate Consideration paid by the Borrower and its Subsidiaries is less than $5,000,000 when aggregated with the Aggregate Consideration paid in connection with any other Permitted Acquisition consummated on or after the Third Amended and Restated Effective Date  and (1) the Person or assets to be acquired are in a business which is reasonably related to the business the Borrower or any Subsidiary of the Borrower is engaged in on the date hereof (2) after giving effect thereto on a pro forma basis for the period (the "Pro Forma Period") of four fiscal quarters ending with the fiscal quarter for which financial statements have most recently been delivered (or were required to be delivered) under Section 7.1 (on the basis that (A) Indebtedness incurred or assumed in connection with such Acquisition was incurred or assumed at the beginning of the Pro Forma Period, (B) if such Indebtedness bears interest at a floating rate, interest expense for the Pro Forma Period shall be calculated at the rate in effect on the date of such Acquisition, and (C) all income and expenses associated with the assets or entity acquired in connection with such Acquisition for the most recently ended four fiscal quarter period for which such income and expense amounts are available (with good faith estimates thereof being permitted if financial statements indicating such amounts are not available) shall be treated as being earned or incurred by Borrower over the Pro Forma Period on a pro forma basis), no Event of Default or Unmatured Event of Default would exist hereunder (including, without limitation, under Section 8.1(d)); (3) the ratio of Consolidated Debt to Consolidated EBITDA of Borrower on the pro forma basis described above would be less than 2.75 to 1.0; and (4) after giving effect thereto the Borrower's Liquidity shall not be less than $35,000,000; and (ii) Borrower and its Subsidiaries have complied with the requirement of Section 7.12 hereof with respect to any required execution of the Subsidiary Guarantee Agreement; and (iii) such Acquisition has been approved by the board of directors of the Person to be acquired.

"Permitted IDB/Community Development Indebtedness": (a) Indebtedness related to municipal bonds or similar obligations of a state or political subdivision thereof, issued in connection with an industrial development or related facilities, and (b) Indebtedness owed to or for the benefit of any community development agency, state or local economic development authority or similar entity providing loans, grants or other economic assistance to encourage employment, construction, local investment or other activity deemed beneficial for the community (including without limitation such indebtedness having terms calling for reduced interest rates, debt forgiveness and similar benefits) not exceeding in the aggregate $1,500,000 outstanding at any time (when aggregated with amounts of Permitted IDB/Community Development Indebtedness outstanding on the Third Amended and Restated Effective Date and scheduled on Schedule 5.6 to the Credit Agreement).

"Permitted Investments":

(i)     any demand deposits with any bank or trust company maintained in the ordinary course of business or shares of any money market mutual fund rated at least AAA or the equivalent thereof by S&P or at least Aaa or the equivalent thereof by Moody's, including, without limitation, any such mutual fund managed or advised by any Lender or Agent;

(ii)     any evidence of Indebtedness, maturing not more than two (2) years after the date of acquisition thereof, issued by the U.S., or an instrumentality or agency thereof and guaranteed fully as to principal, interest and premium, if any, by the U.S.;

(iii)    any certificate of deposit that is denominated in Dollars, maturing not more than six (6) months after the date of purchase, issued by a Lender or a commercial banking institution which is a member of the Federal Reserve System and which has a combined capital and surplus and undivided profits of not less than $200,000,000;

(iv)    commercial paper, maturing not more than ninety (90) days after the date of acquisition, issued by a corporation organized and existing under the laws of any State of the U.S. or the District of Columbia or Canada, which is denominated in Dollars, with a rating, at any date of determination, of "Prime‑2" (or better) according to Moody's, or "A‑2" (or better) according to S & P;

(v)     any Investments in any Credit Party (other than an Investment in connection with an Acquisition which shall be governed by clause (vii));

(vi)    any Investments made after the Third Amended and Restated Effective Date by Borrower or any Credit Party in any Subsidiary which is not a Credit Party or any Permitted Unconsolidated Venture in an aggregate amount outstanding at any time not in excess of $5,000,000 or, in the case of any Subsidiary which is not a Credit Party, any Investment in any Subsidiary which is not a Credit Party;

(vii)    Investments made solely as a result of mergers, acquisitions or consolidations permitted under Section 8.4;

(viii)    loans or advances to employees made in the ordinary course of business;

(ix)    Investments in overnight Nassau time deposits and Eurodollar deposits in branches or offices of banking institutions described in clause (ii) of this definition of the term "Permitted Investments";

(x)     Investments outstanding as of the Closing Date in Subsidiaries (as such Investments may be adjusted due to appreciation, repayment of principal, payment of interest, return of capital and similar circumstances);

(xi)    Investments not otherwise permitted hereunder not to exceed $3,000,000 in the aggregate outstanding at any time;

(xii)    Investments by Buckbee-Mears European Holding Company B.V. ("BV2") in that certain Note A dated as of December 22, 1999 by Buckbee-Mears Deutschland Holding GmbH in favor of the Borrower and assigned to BV2 in the original principal amount of 77,000,000 Euro; and

(xiii)    Investments by the Borrower in that certain Note B dated as of December 22, 1999 by Buckbee-Mears Holding Company B.V. in favor of the Borrower in the original principal amount of 77,000,000 Euro ("Note B&1uot;);

provided that if a Permitted Unconsolidated Venture or a Subsidiary which is not a Credit Party shall thereafter become a Credit Party, the foregoing limitations shall thereafter be determined as though any Investment made in such Permitted Unconsolidated Venture or Subsidiary was originally made as an Investment in a Credit Party permitted under clause (v) above; provided, further, that Permitted Investments shall not include Cash or Cash Equivalents exceeding $7,000,000 held by Borrower or its Subsidiaries for more than five (5) consecutive Business Days.

"Permitted Liens": The following Liens:

(i)     Liens for property taxes and assessments or governmental charges or levies and Liens securing claims or demands of mechanics and materialmen; provided, however, payment thereof is not later than the time required by Section 7.5;

(ii)     Liens in an aggregate amount not to exceed $10,000,000 at any time of or resulting from any judgment or award, the time for the appeal or petition for rehearing of which shall not have expired, or in respect of which Borrower or a Subsidiary of Borrower shall at any time in good faith be prosecuting an appeal or proceeding for a review and in respect of which a stay of execution pending such appeal or proceeding for review shall have been secured;

(iii)    Liens incidental to the conduct of business or the ownership of properties and assets (including Liens in connection with worker's compensation, unemployment insurance and other like laws, warehousemen's and attorneys' liens and statutory landlords' liens) and Liens to secure the performance of bids, tenders or trade contracts, or to secure statutory obligations, surety or appeal bonds or other Liens of like general nature incurred in the ordinary course of business and not in connection with the borrowing of money; provided, however, in each case, the obligation secured is not overdue or, if overdue, is being contested in good faith by appropriate actions or proceedings;

(iv)    minor survey exceptions or minor encumbrances, easements or reservations, or rights of others for rights‑of‑way, utilities and other similar purposes, or zoning or other restrictions as to the use of real properties, which customarily exist on properties of corporations engaged in similar activities and similarly situated and which do not in any event materially impair their use in the operation of the business of Borrower and its Subsidiaries;

(v)     Liens securing Indebtedness of a Subsidiary of Borrower to Borrower;

(vi)    Liens existing as of the Third Amended and Restated Effective Date and reflected on Schedule 8.3 hereto and Liens incurred in connection with the refinancing of Indebtedness secured thereby so long as no such Lien extends to any property not subject thereto as of the Third Amended and Restated Effective Date (other than improvements thereto or, if required by the terms of the document or instrument creating or governing such Lien as in effect on the Third Amended and Restated Effective Date, additions thereto and replacements and substitutions therefor);

(vii)    customary rights of setoff, revocation, refund or chargeback under deposit agreements or under the UCC of banks or other financial institutions where Borrower or its Subsidiaries maintain deposits in the ordinary course of business;

(viii)    Liens securing Permitted IDB/Community Development Indebtedness;

(ix)    additional Liens incurred by Borrower and its Subsidiariesso long as the aggregate amount of the obligations secured by such Liens does not exceed on and after the Third Amended and Restated Effective Date, $2,000,000 plus any amounts outstanding on the Third Amended and Restated Effective Date and listed on Schedule 8.3 hereto; and

(x)   Permitted Real Property Encumbrances.

"Permitted Real Property Encumbrances": (i) those liens, encumbrances and other matters affecting title to any Mortgaged Property listed in the Mortgage Policies on the date of delivery of such Mortgage Policies to Agent in accordance with the terms hereof,  (ii) as to any particular parcel of real property at any time, such easements, encroachments, covenants, rights of way, minor defects, irregularities or encumbrances on title which do not materially impair such parcel of real property for the purpose for which it is held by the user thereof, or the Lien held by Agent, (iii) municipal and zoning ordinances and environmental regulations, which are not violated in any material respect by the existing improvements and the present use made by the mortgagor thereof of the premises (as defined in the respective Mortgage), (iv) general real estate taxes and assessments not yet delinquent, and (v) such other items as to which Agent may consent which do not materially impair such parcel of real property for the purpose for which it is held by the user thereof, or the Lien held by the Agent.

"Permitted Subordinated Indebtedness": up to $100,000,000 in aggregate initial principal amount of indebtedness of the Borrower which (i) by its terms is expressly subordinated to this Agreement, as from time to time amended, restated, supplemented, modified, refinanced, refunded or replaced, (ii) has a maturity date not less than one year after the Termination Date, (iii) is in all respects in form and substance satisfactory to Agent and (iv) is rated no lower than BB by S&P and no lower than Ba2 by Moody's.

"Permitted Unconsolidated Venture": an Investment in a Person not constituting a Subsidiary of Borrower which Person is engaged in the same or related business as Borrower or any of its Subsidiaries is engaged on the Closing Date.

"Person": an individual or a corporation, limited liability company, partnership, trust, incorporated or unincorporated association, joint venture, joint stock company, government (or an agency or political subdivision thereof) or other entity of any kind provided; however, that references to Persons include their respective permitted successors and assigns or, in the case of governmental Persons, Persons succeeding to the relevant functions of such persons; and all references to statutes and related regulations shall include any amendments of same and any successor statutes and regulations.

"Plan": any plan described in Section 4021(a) of ERISA and not excluded pursuant to Section 4021(b) thereof, which may hereafter be or has been established or maintained, within the immediately preceding six years, or to which contributions are or, within the immediately preceding six years, have been made, by Borrower or any of its Subsidiaries or ERISA Affiliates, but not including any Multiemployer Plan.

"Plan Administrator": has the meaning assigned to the term "administrator" in Section 3(16)(A) of ERISA.

"Plan Sponsor": has the meaning assigned to the term "plan sponsor" in Section 3(16)(B) of ERISA.

"Pledge Agreement": has the meaning assigned to that term in Section 6.1(a)(iv).

 "Pledged Stock": as defined in the Security Documents.

"Prime Lending Rate": the rate which DBTCA announces from time to time as its prime lending rate, base rate or equivalent, as in effect from time to time.  The Prime Lending Rate is a reference rate and does not necessarily represent the lowest or best rate actually charged to any customer.  Any Lender may make commercial loans or other loans at rates of interest at, above or below the Prime Lending Rate.  The Prime Lending Rate shall change automatically and without notice from time to time as and when DBTCA changes its prime lending rates, base rates or equivalent.

"Pro Rata Share": when used with reference to any Lender and any described aggregate or total amount, an amount equal to the result obtained by multiplying such described aggregate or total amount by a fraction the numerator of which shall be such Lender's Revolving Commitment and the denominator of which shall be the Total Revolving Commitment or, if no Revolving Commitments are then outstanding, such Lender's aggregate outstanding principal amount of Revolving Loans and LC Obligations to the total outstanding principal balance of all Revolving Loans and LC Obligations hereunder.

"Quarterly Payment Date": the last Business Day of each March, June, September and December of each year.

"Ramsey Mortgage": the form of Ramsey Mortgage attached hereto as Exhibit 6.1(a)(vi)(i) covering the Ramsey, Minnesota property of the Borrower's Subsidiary as amended, restated, supplemented or otherwise modified from time to time.

"Ramsey Mortgage Policy": any mortgage insurance policies, "marked up" mortgage title insurance commitment, items described in Exhibit 6.1(a)(vi)(ii) hereto or similar documents delivered pursuant to Section 5.19(b).

"Recovery Event": the receipt by Borrower (or any of its Affiliates) of any insurance or condemnation proceeds payable (i) by reason of any theft, physical destruction or damage or any other similar event with respect to any properties or assets of Borrower or any of its Subsidiaries, (ii) by reason of any condemnation, taking, seizing or similar event with respect to any properties or assets of Borrower or any of its Subsidiaries and (iii) under any policy of insurance required to be maintained under Section 5.17.

"Redeemable Stock": any Capital Stock that by its terms or otherwise is required to be redeemed on or prior to the first anniversary of the Termination Date (as the same may be extended pursuant to the terms hereof) or is redeemable at the option of the holder thereof at any time on or prior to the first anniversary of such Termination Date.

"Refunded Swing Line Loans": as defined in Section 2.2(d).

"Register": as defined in Section 11.9(c).

"Regulation D", "Regulation T", "Regulation U" and "Regulation X": respectively, Regulation D, T, U and X of the Board as from time to time in effect and any successor to all or a portion of any thereof.

"Release": any release, spill, emission, leaking, pumping, pouring, emptying, dumping, injection, deposit, disposal, discharge, dispersal, escape, leaching or migration in violation of any Environmental Law into the indoor or outdoor environment or into or out of any property of Borrower or its Subsidiaries, or at any other location, including any location to which Borrower or any Subsidiary has transported or arranged for the transportation of any Contaminant, including the movement of Contaminants through or in the air, soil, surface water, groundwater or property of Borrower or its Subsidiaries or at any other location, including any location to which Borrower or any Subsidiary has transported or arranged for the transportation of any Contaminant.

"Remedial Action": actions required to (i) clean up, remove, treat or in any other way address Contaminants in the indoor or outdoor environment, (ii) prevent or minimize the Release or threat of Release of Contaminants so they do not migrate or endanger or threaten to endanger public health or welfare or the indoor or outdoor environment; or (iii) perform pre-remedial or post-remedial studies and investigations and post-remedial monitoring and care or any other studies, reports or investigations relating to Contaminants.

 "Reportable Event": a "reportable event" described in Section 4043(c) of ERISA or in the regulations thereunder or receipt of a notice of withdrawal liability with respect to a Multiemployer Plan pursuant to Section 4202 of ERISA.

"Required Lenders": at any time, Lenders then holding at least 51% of the sum of (a) the then aggregate unpaid principal amount of the Term Loans,  plus (b) the amount of the Total Revolving Commitment (or if the Total Revolving Commitment has been terminated, then the aggregate principal amount outstanding of Revolving Loans, plus the outstanding amount of LC Obligations); provided, that, if no principal amount of any Loan is then outstanding, then "Required Lenders" shall mean Lenders then having at least 51% of the Total Revolving Commitment.

"Requirement of Law": as to any Person, any law (including common law), treaty, rule or regulation or determination of an arbitrator or a court or other Governmental Authority, including without limitation, any Environmental Law, 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 any of the President, any Executive Vice President, the Chief Financial Officer, Controller or the Treasurer of Borrower.

"Restatement Date": the date on which the conditions specified in Section 6.1 of the Second Amendment and Restatement Agreement were satisfied (or waived in accordance with Section 11.1).

"Restructuring Charges": for any period of four consecutive fiscal quarters that includes the first fiscal quarter of Fiscal Year 2002, any actual restructuring charges recorded by the Borrower and its Subsidiaries during such period but no later than the first quarter of Fiscal Year 2002 in an aggregate amount for all such Restructuring Charges not to exceed $15,000,000, of which up to $4,000,000 may be in cash, in connection with the restructuring of the Borrower and its Subsidiaries.

"Revolver Commitment Reduction" means a permanent reduction of the undrawn Revolving Commitments of the Lenders on the Restatement Date by $35,000,000.

"Revolving Commitment": as to any Lender, the obligation of such Lender to (a) make Revolving Loans to Borrower, (b) participate in Swing Line Loans made to Borrower and (c) to participate in Letters of Credit, in an aggregate principal and/or Stated Amount at any one time outstanding not to exceed the amount set forth opposite such Lender's name on Schedule 2.1(b) under the heading "Revolving Commitment", and as such amount may be reduced from time to time in accordance with the terms hereof; collectively, as to all Lenders, the "Revolving Commitments".

"Revolving Lenders": any Lender that has a Revolving Commitment or is owed a Revolving Loan.

"Revolving Loan Facility": means the credit facility consisting of the Revolving Commitments.

"Revolving Loans": as defined in Section 2.1(b).

"Revolving Note": as defined in Section 2.1(b).

"Sale and Leaseback Transaction": any arrangement, directly or indirectly, with any Person whereby a seller or transferor shall sell or otherwise transfer any real or personal property and then or thereafter lease, or repurchase under an extended purchase contract, conditional sales or other title retention agreement, the same or similar property.

"Scheduled Term Repayments" means a Scheduled Term A Repayment or a Scheduled Term B Repayment.

"Scheduled Term A Repayments" means, with respect to the principal payments on the Term A Loans for each date set forth below, the Dollar amount set forth opposite thereto:

Date	Scheduled Term A Loan Principal Payment
September 30, 2002	$1,665,900
December 31, 2002	$1,665,900
March 31, 2003	$2,332,260
June 30, 2003	$2,332,260
September 30, 2003	$2,332,260
December 31, 2003	$2,332,260
March 31, 2004	$2,332,260

Term A Loan Maturity Date          $58,306,900 or, if less, the aggregate principal amount of Term A Loans outstanding

"Scheduled Term B Repayments" means, with respect to the principal payments on the Term B Loans for each date set forth below, the Dollar amount set forth opposite thereto:

	Scheduled Term B Loan
Date	Principal Payment
September 30, 2002	$834,100
December 31, 2002	$834,100
March 31, 2003	$1,167,740
June 30, 2003	$1,167,740
September 30, 2003	$1,167,740
December 31, 2003	$1,167,740
March 31, 2004	$1,167,740
Term B Loan Maturity Date	$29,193,100 or, if less, the aggregate principal amount of Term B Loans outstanding

"Second Amendment and Restatement Agreement": as defined in the Recitals.

"Second Quarter 2001 Deferred Tax Charge": means, with respect to any period of four consecutive fiscal quarters which includes June 30, 2001, the charge against earnings taken for the second quarter of Fiscal Year 2001 for valuation of deferred income taxes in an amount not exceeding $10,000,000.

"Secured Creditors": as defined in the Security Documents.

"Security Agreements": as defined in Section 6.1(a)(iii).

"Security Documents": collectively, the Security Agreements, the Mortgage, each of the Pledge Agreements each Subsidiary Guarantee Agreement, each Additional Security Document and all other agreements, assignments, security agreements, instruments and documents executed in connection therewith, in each case as the same may be amended, supplemented, restated or otherwise modified and in effect.  For purposes of this Agreement, "Security Documents" shall also include all guaranties, security agreements, mortgages, pledge agreements, collateral assignments, subordination agreements and other collateral documents in the nature of any thereof entered into by Borrower or any Subsidiary of Borrower after the date of this Agreement in favor of Agent for the benefit of the Lenders in satisfaction of the requirements of any Loan Document.

"S&P": Standard & Poor's Ratings Services, a division of the McGraw Hill Companies, Inc. or any successor to the rating agency business thereof.

"Standby Letters of Credit" means any of the irrevocable standby letters of credit issued for the account of Borrower pursuant to this Agreement, in form acceptable to the Facing Agent, together with any increases or decreases in the Stated Amount thereof and any renewals, amendments and/or extensions thereof.

 "Stated Amount" or "Stated Amounts": with respect to any Letter of Credit issued in Dollars, the stated or face amount of such Letter of Credit to the extent available at the time for drawing (subject to presentment of all requisite documents), as the same may be increased or decreased from time to time in accordance with the terms of such Letter of Credit.  

 "Subsidiary": as to any Person, any corporation, partnership (limited or general), limited liability company, trust or other entity of which a majority of the stock (or equivalent ownership or controlling interest) having voting power to elect a majority of the board of directors (if a corporation) or to select the trustee or equivalent controlling interest, shall, at the time such reference becomes operative, be directly or indirectly owned or controlled by such Person or one or more of the other subsidiaries of such Person or any combination thereof.  Unless otherwise qualified, all references to a "Subsidiary" or to "Subsidiaries" in this Agreement shall refer to a Subsidiary or Subsidiaries of Borrower.

"Subsidiary Guarantee Agreement": the Subsidiary Guarantee Agreement in substantially the form of Exhibit 6.1(a)(v) hereto, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms and the terms hereof.

"Subsidiary Guarantor": such Subsidiaries which are parties to the Subsidiary Guarantee Agreement or which pursuant to Section 7.12 from time to time become a party to the Subsidiary Guarantee Agreement and collectively, all of such Subsidiaries.

"Subsidiary Guarantor Security Agreement" as defined in Section 6.1(a)(iii).

"Supermajority Lenders" of any Facility means those Non-Defaulting Lenders of such Facility the sum of whose outstanding Loans of such Facility would constitute greater than 66 2/3% of the sum of the total outstanding Loans of Non-Defaulting Lenders of such Facility.

"Swing Line Commitment": of the Swing Line Lender at any date, the obligation of the Swing Line Lender to make Swing Line Loans pursuant to Section 2.2 in the amount referred to therein.

"Swing Line Lender": DBTCA.

"Swing Line Loans": as defined in Section 2.2(a).

"Swing Line Loan Participation Certificate": a certificate, substantially in the form of Exhibit 2.2(e).

"Swing Line Note": as defined in Section 2.2(b).

 "Taxes": any present or future taxes, levies, imposts, duties or other charges of whatever nature imposed by any government or any political subdivision or taxing authority thereof, other than any tax on, or measured by, the net income of any applicable Lender.

"Term A Conversion Pro Rata Share": means, when used with reference to any Original Term Loan Lender, an amount equal to the result obtained by multiplying $73,300,000 by a fraction the numerator of which shall be such Lender's then outstanding Original Term Loans and the denominator of which shall be all then outstanding Original Term Loans.

"Term A Facility" means the credit facility under this Agreement evidenced by the Term A Loans.

"Term A Lender" means any Lender which is owed a Term A Loan.

"Term A Loan" and "Term A Loans" as defined in Section 2.1(a)(ii).

"Term A Loan Maturity Date": May 14, 2004 or such earlier date as the outstanding Term A Loans shall have been reduced to $0 pursuant to this Agreement.

"Term A Note" is defined in Section 2.2(a).

"Term A Percentage" means, as of any date of determination, expressed as a percentage, (i) the aggregate principal amount of outstanding Term A Loans divided by (ii) the aggregate principal amount of all outstanding Term Loans.

"Term A Pro Rata Share" means, when used with reference to any Term A Lender and any described aggregate or total amount, an amount equal to the result obtained by multiplying such described aggregate or total amount by a fraction the numerator of which shall be such Lender's then outstanding Term A Loan and the denominator of which shall be all then outstanding Term A Loans.

"Term B Conversion Pro Rata Share": means, when used with reference to any Original Term Loan Lender, an amount equal to the result obtained by multiplying $36,700,000 by a fraction the numerator of which shall be such Lender's then outstanding Original Term Loans and the denominator of which shall be all then outstanding Original Term Loans.

"Term B Facility" means the credit facility under this Agreement evidenced by the Term B Loans.

"Term B Lender" means any Lender which is owed a Term B Loan.

"Term B Loan" and "Term B Loans": as defined in Section 2.1(a)(ii).

"Term B Loan Maturity Date": May 14, 2004 or such earlier date as the outstanding Term B Loans shall have been reduced to $0 pursuant to this Agreement.

"Term B Note": as defined in Section 2.2(a).

"Term B Percentage": means, as of any date of determination, expressed as a percentage, (i) the aggregate principal amount of outstanding Term B Loans divided by (ii) the aggregate principal amount of all outstanding Term Loans.

"Term B Pro Rata Share": means, when used with reference to any Term B Lender and any described aggregate or total amount, an amount equal to the result obtained by multiplying such described aggregate or total amount by a fraction the numerator of which shall be such Lender's then outstanding Term B Loan and the denominator of which shall be all then outstanding Term B Loans.

"Term Lender": any Lender that is owed a Term Loan.

"Term Loan" and "Term Loans": as defined in Section 2.1(a)(ii).

"Term Loan Conversion": as defined in Section 2.1(a)(i).

"Term Loan Conversion Notice": a Term Loan Conversion Notice substantially in the form of Exhibit 11.10 annexed hereto, delivered on or prior to the Restatement Date and made a part hereof made by any applicable Lender.

"Term Note": as defined in Section 2.2(a).

"Termination Date": the earlier to occur of

(a)     May 14, 2004; and
      (b)     the date on which the Commitments shall otherwise terminate in accordance with the provisions of this Agreement.

"Termination Event": (i) a Reportable Event (other than a Reportable Event not subject to the provisions for 30-day notice to the PBGC), or (ii) the withdrawal of Borrower or any of its ERISA Affiliates from a Plan during a plan year in which it was a "substantial employer" as defined in Section 4001(a)(2) of ERISA, or (iii) the filing of a notice of intent to terminate a Plan in a distress termination under Section 4041 of ERISA, or (iv) the institution of proceedings to terminate a Plan by the PBGC, or (v) any other event or condition which could reasonably be expected to constitute grounds under Section 4042 of ERISA for the involuntary termination of, or the appointment of a trustee to administer, any Plan, or (vi) the imposition of liability of Borrower or any of its ERISA Affiliates pursuant to Sections 4064 or 4069 of ERISA, which, in the case of any event described in clauses (i) through (vi) above, would cause the sum of Borrower's and its ERISA Affiliates' liabilities (after giving effect to the tax consequences thereof) resulting from or otherwise associated with such event to exceed $10,000,000.

"Third Amended and Restated Effective Date": the date on which the conditions specified in Section 6.2 of the Third Amended and Restated Credit Agreement are satisfied (or waived in accordance with Section 11.1).

 "Third Quarter 2001 Nonrecurring Charges" means, with respect to any period of four consecutive fiscal quarters which includes September 30, 2001, actual non-recurring charges of the Borrower and its Subsidiaries in an amount up to $3,500,000.

"Total Available Revolving Commitment": at the time any determination thereof is made, the sum of the respective Available Revolving Commitments of the Revolving Lenders at such time.

"Total Revolving Commitment": at any time any determination is to be made, the sum of the respective Revolving Commitments of the Revolving Lenders at such time.

"Transaction": shall mean and include (i) each of the Credit Events occurring on the Restatement Date, (ii) such other transactions as are contemplated by the Documents, and (iii) the payment of fees and expenses in connection with the foregoing.

"Type": as to any Loan, its nature as a Base Rate Loan or a Eurodollar Loan.

"Unmatured Event of Default": an event, act, condition or occurrence which with the giving of notice or the lapse of time (or both) would become an Event of Default.

"Unpaid Drawing": as defined in Section 2.9(c).

"U.S.": the United States of America, its territories, its possessions and all other areas subject to its jurisdiction.

"Voting Securities": any class of Capital Stock of a Person pursuant to which the holders thereof have, at the time of determination, the general voting power under ordinary circumstances to vote for the election of directors, managers, trustees or general partners of such Person (irrespective of whether or not at the time any other class or classes will have or might have voting power by reason of the happening of any contingency).

"Wholly‑Owned Subsidiary": with respect to any Person, any Subsidiary of such Person, all of the outstanding shares of capital stock of which (other than qualifying shares required to be owned by directors) are at the time owned directly or indirectly by such Person and/or one or more Wholly‑Owned Subsidiaries of such Person.

"Withdrawal Liability": liability to a Multiemployer Plan as a result of a complete or partial withdrawal of Borrower or any of its Subsidiaries from such Multiemployer Plan, as such terms are defined in Part I of Subtitle E of Title IV of ERISA.

"written" or "in writing": any form of written communication or a communication by means of a telecopier device or authenticated telex, telegraph or cable.

1.2    Accounting Terms, Financial Statements.  All accounting terms used herein shall have the respective meanings given to them in accordance with GAAP, unless otherwise provided herein.  All computations and determinations for purposes of determining compliance with the financial requirements of this Agreement shall be made in accordance with GAAP, unless otherwise provided herein.

1.3    Other Definitional Terms.  The words "hereof", "herein" and "hereunder" and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement, and Article, Section, Recital, Schedule, Exhibit and like references are to this Agreement unless otherwise specified.

ARTICLE II
AMOUNT AND TERMS OF CREDIT

2.1    The Commitments.

(a)     Term Loans.          

(i)     On the Restatement Date, each Converting Lender, severally and for itself alone, converted a portion of its then outstanding Revolving Loans in a principal amount equal to the amount set forth opposite each such Lender's name on Schedule 2.1(a)(i) hereto or in any Term Loan Conversion Notice delivered by such Lender to term loans (in each case such Converting Lender's "Converted Term Loan Amount" and each such loan as converted, an "Original Term Loan" and collectively, the "Original Term Loans").  Each Lender's Revolving Commitment in effect immediately prior to the Restatement Date was reduced by its Converted Term Loan Amount, if any (collectively, the "Term Loan Conversion").  The amount of Revolving Loans that was converted to Term Loans on the Restatement Date was a principal amount of $125,000,000.

(ii)     On the Third Amended and Restated Effective Date, each Lender with an Original Term Loan (each an "Original Term Loan Lender"), severally and for itself alone, hereby agrees, on the terms and subject to the conditions hereinafter set forth and in reliance upon the representations and warranties set forth herein and in the other Loan Documents, to convert all of its Original Term Loans outstanding on the Third Amended and Restated Effective Date (the "Original Term Loan Conversion") into two separate tranches of term loans with (A) the Term A Conversion Pro Rata Share of such Original Term Loan Lender's Original Term Loans being converted into one tranche of term loans (each such loan as converted, a "Term A Loan" and collectively, the "Term A Loans") and (B) the Term B Conversion Pro Rata Share of such Original Term Loan Lender's Original Term Loans being converted into a separate tranche of term loans (each such loan as converted, a "Term B Loan" and collectively, the "Term B Loans" and together with the Term A Loans, collectively, the "Term Loans").  Except as hereinafter provided, Term Loans may, at the option of Borrower, be maintained as and/or converted into Base Rate Loans or Eurodollar Loans.  No amount of a Term Loan which is repaid or prepaid by Borrower may be reborrowed hereunder.  The amount of each Lender's outstanding Term A Loans and Term B Loans on the Third Amended and Restated Effective Date shall be as set forth on Schedule 2.1(a)(ii) under the columns "Term A Loans" and "Term B Loans", respectively.  The Borrower and the Lenders hereby acknowledge that the aggregate amounts of the Term A Loans and Term B Loans outstanding on the Third Amended and Restated Effective Date is equal to $73,300,000 and $36,700,000, respectively. 

(b)     Revolving Loan Commitment.  Each Lender severally and for itself alone, hereby agrees, on the terms and subject to the conditions hereinafter set forth and in reliance upon the representations and warranties set forth herein and in the other Loan Documents, to make loans to Borrower on a revolving basis from time to time during the Commitment Period, in an amount not to exceed its Commitment Percentage of the Total Available Revolving Commitment (each such loan by any Lender, a "Revolving Loan" and collectively, the "Revolving Loans"); provided, however, that, after giving effect to any Borrowing of Revolving Loans, the aggregate amount of all outstanding Revolving Loans, and the aggregate amount of all LC Obligations and Swing Line Loans then outstanding, shall not at any time exceed the lesser of (i) the Borrowing Base and (ii) the Total Revolving Commitment; provided, further, that in no event may Borrower make any Borrowing of Revolving Loans the effect of which would cause Borrower to have on hand Cash or Cash Equivalents in excess of $7,000,000 for a period greater than five (5) consecutive Business Days.  All Revolving Loans comprising the same Borrowing hereunder shall be made by the Revolving Lenders simultaneously and in proportion to their respective Revolving Commitments.  Prior to the Termination Date, Revolving Loans may be repaid and reborrowed by Borrower in accordance with the provisions hereof and, except as otherwise specifically provided in Section 3.6, all Revolving Loans comprising the same Borrowing shall at all times be of the same Type.  Notwithstanding anything else herein to the contrary, the parties hereby acknowledge that (A) on the Restatement Date, the Total Revolving Commitment in effect immediately prior to the Restatement Date (which, for the avoidance of doubt, was $220,000,000) was permanently reduced by (x) the Aggregate Converted Term Loan Amount; and (y) the Revolver Commitment Reduction; and (B) on the Third Amended and Restated Effective Date, the Total Revolving Commitment in effect immediately prior to the Third Amended and Restated Effective Date (which, for avoidance of doubt, is acknowledged to be $60,000,000) shall be permanently reduced by $25,000,000 and the Borrower and the Lenders hereby acknowledge that the Total Revolving Commitment after such reduction shall be equal to $35,000,000.

(c)    Swing Line Loans.

(i)     Swing Line Commitment.  Subject to the terms and conditions hereof, the Swing Line Lender in its individual capacity agrees to make swing line loans in Dollars ("Swing Line Loans") to Borrower on any Business Day from time to time during the Commitment Period in an aggregate principal amount at any one time outstanding not to exceed $10,000,000; provided, however, that in no event may the amount of any Borrowing of Swing Line Loans (A) exceed the Total Available Revolving Commitment immediately prior to such Borrowing (after giving effect to the use of proceeds thereof) or (B) cause the outstanding Revolving Loans of any Lender, when added to such Lender's Commitment Percentage of the then outstanding Swing Line Loans and Commitment Percentage of the aggregate LC Obligations (exclusive of Unpaid Drawings relating to LC Obligations which are repaid with the proceeds of, and simultaneously with the incurrence of, Revolving Loans or Swing Line Loans) to exceed such Lender's Revolving Commitment; provided, further, that, after giving effect to any Borrowing of Swing Line Loans, the aggregate amount of all outstanding Swing Line Loans, and the aggregate amount of all LC Obligations and Revolving Loans then outstanding, shall not at any time exceed the lesser of (i) the Borrowing Base and (ii) the Total Revolving Commitment.  Amounts borrowed by Borrower under this Section 2.1(c)(i) may be repaid and, at any time prior to the Termination Date, reborrowed.  The Swing Line Loans shall be made in Dollars and maintained as Base Rate Loans and, notwithstanding Section 2.6, shall not be converted into any other Type of Loan.

(ii)     Refunding of Swing Line Loans.  The Swing Line Lender, at any time in its sole and absolute discretion, may on behalf of Borrower (which hereby irrevocably directs the Swing Line Lender to so act on its behalf) notify each Lender (including the Swing Line Lender) to make a Revolving Loan in an amount equal to such Lender's Commitment Percentage of the principal amount of the Swing Line Loans (the "Refunded Swing Line Loans") outstanding on the date such notice is given, provided, however, that such notice shall be deemed to have automatically been given upon the occurrence of an Event of Default under Sections 9.1(g) or 9.1(h) or upon the occurrence of a Change of Control.  Unless any of the events described in Sections 9.1(g) or 9.1(h) shall have occurred (in which event the procedures of Section 2.1(c)(iii) shall apply) and regardless of whether the conditions precedent set forth in this Agreement to the making of a Revolving Loan are then satisfied, each Lender shall make the proceeds of its Revolving Loan available to the Swing Line Lender at the Payment Office prior to 11:00 A.M., New York City time, in funds immediately available on the Business Day next succeeding the date such notice is given.  The proceeds of such Revolving Loans shall be immediately applied to repay the Refunded Swing Line Loans.

(iii)    Participation in Swing Line Loans.  If, prior to refunding a Swing Line Loan with a Revolving Loan pursuant to Section 2.1(c)(ii), one of the events described in Sections 9.1(g) or 9.1(h) shall have occurred, or if for any other reason a Revolving Loan cannot be made pursuant to Section 2.1(c)(ii), then, subject to the provisions of Section 2.1(c)(iv) below, each Lender will, on the date such Revolving Loan was to have been made, purchase (without recourse or warranty) from the Swing Line Lender an undivided participation interest in the Swing Line Loans in an amount equal to its Commitment Percentage of such Swing Line Loans.  Upon request, each Lender will immediately transfer to the Swing Line Lender, in immediately available funds, the amount of its participation and upon receipt thereof the Swing Line Lender will deliver to such Lender a Swing Line Loan Participation Certificate dated the date of receipt of such funds and in such amount.

(iv)    Lenders' Obligations Unconditional.  Each Lender's obligation to make Revolving Loans in accordance with Section 2.1(c)(ii) and to purchase participating interests in accordance with Section 2.1(c)(iii) above shall be absolute and unconditional and shall not be affected by any circumstance, including, without limitation, (A) any setoff, counterclaim, recoupment, defense or other right which such Lender may have against the Swing Line Lender, Borrower or any other Person for any reason whatsoever; (B) the occurrence or continuance of any Event of Default or Unmatured Event of Default; (C) any adverse change in the condition (financial or otherwise) of Borrower or any other Person; (D) any breach of this Agreement by Borrower or any other Person; (E) any inability of Borrower to satisfy the conditions precedent to borrowing set forth in this Agreement on the date upon which such participating interest is to be purchased or (F) any other circumstance, happening or event whatsoever, whether or not similar to any of the foregoing.  If any Lender does not make available to the Swing Line Lender the amount required pursuant to Section 2.1(c)(ii) or (iii) above, as the case may be, the Swing Line Lender shall be entitled to recover such amount on demand from such Lender, together with interest thereon for each day from the date of non-payment until such amount is paid in full at the Federal Funds Rate for the first two Business Days and at the Base Rate thereafter.  Notwithstanding the foregoing provisions of this Section 2.1(c)(iv), no Lender shall be required to make a Revolving Loan to Borrower for the purpose of refunding a Swing Line Loan pursuant to Section 2.1(c)(ii) above or to purchase a participating interest in a Swing Line Loan pursuant to Section 2.1(c)(iii) if an Event of Default or Unmatured Event of Default has occurred and is continuing and, prior to the making by the Swing Line Lender of such Swing Line Loan, the Swing Line Lender had received written notice from such Lender specifying that such Event of Default or Unmatured Event of Default has occurred and is continuing, describing the nature thereof and stating that, as a result thereof, such Lender shall cease to make such Refunded Swing Line Loans and purchase such participating interests, as the case may be; provided, however, that the obligation of such Lender to make such Refunded Swing Line Loans and to purchase such participating interests shall be reinstated upon the earlier to occur of (y) the date upon which such Lender notifies the Swing Line Lender that its prior notice has been withdrawn and (z) the date upon which the Event of Default or Unmatured Event of Default specified in such notice no longer is continuing.

2.2    Notes.

(a)     Evidence of Indebtedness.  Borrower's obligation to pay the principal of and interest on all the Loans made to it by each Lender shall be evidenced, (w) if Term A Loans, by a promissory note (each, a "Term A Note" and collectively, the "Term A Notes") duly executed and delivered by Borrower substantially in the form of Exhibit 2.2(a)-1(a) hereto, with blanks appropriately completed in conformity herewith, (x) if Term B Loans, by a promissory note (each, a "Term B Note" and collectively, the "Term B Notes" and collectively with the Term A Notes, the "Term Notes")) duly executed and delivered by Borrower substantially in the form of Exhibit 2.2(a)-1(b) hereto, with blanks appropriately completed in conformity herewith, (y) if Revolving Loans, by a promissory note (each, a "Revolving Note" and, collectively, the "Revolving Notes") duly executed and delivered by Borrower substantially in the form of Exhibit 2.2(a)-2 hereto, with blanks appropriately completed in conformity herewith and (z) if Swing Line Loans, by a promissory note (the "Swing Line Note") duly executed and delivered by Borrower substantially in the form of Exhibit 2.2(a)-3 hereto, with blanks appropriately completed in conformity herewith.

(i)     Provisions of the Term Notes.  (x) The Term A Note issued to each Term A Lender shall (A) be executed by Borrower, (B) be payable to the order of such Term A Lender and be dated the Third Amended and Restated Effective Date, (C) be payable in the aggregate principal amount of the Term A Loan evidenced thereby, (D) mature, with respect to each Term A Loan evidenced thereby, on the Term A Loan Maturity Date, (E) be subject to mandatory prepayment as provided in Section 4.3, (F) bear interest as provided in Section 3.1 in respect of the Base Rate Loans and Eurodollar Loans, as the case may be, evidenced thereby and (G) be entitled to the benefits of this Agreement and the other applicable Loan Documents; and (y) the Term B Note issued to each Term B Lender shall (A) be executed by Borrower, (B) be payable to the order of such Term B Lender and be dated the Third Amended and Restated Effective Date, (C) be payable in the aggregate principal amount of the Term B Loan evidenced thereby, (D) mature, with respect to each Term B Loan evidenced thereby, on the Term B Loan Maturity Date, (E) be subject to mandatory prepayment as provided in Section 4.3, (F) bear interest as provided in Section 3.1 in respect of the Base Rate Loans and Eurodollar Loans, as the case may be, evidenced thereby and (G) be entitled to the benefits of this Agreement and the other applicable Loan Documents.

(ii)     Provisions of the Revolving Notes.  The Revolving Note issued to each Lender shall (A) be executed by Borrower, (B) be payable to the order of such Lender and be dated the Third Amended and Restated Effective Date, (C) be in a stated principal amount equal to the Revolving Commitment of such Revolving Lender and be payable in the aggregate principal amount of the Revolving Loans evidenced thereby, (D) mature, with respect to each Loan evidenced thereby, on the Termination Date, (E) be subject to mandatory prepayment as provided in Section 4.3, (F) bear interest as provided in the appropriate clause of Section 3.1 in respect of the Base Rate Loans or Eurodollar Loans, as the case may be, evidenced thereby and (G) be entitled to the benefits of this Agreement and the other applicable Loan Documents.

(iii)    Provisions of the Swing Line Note.  The Swing Line Note issued to the Swing Line Lender shall (A) be executed by Borrower, (B) be payable to the order of Swing Line Lender or its registered assigns and be dated the Initial Borrowing Date, (C) be in a stated principal amount equal to the Swing Line Commitment and be payable in the aggregate principal amount of the Swing Line Loans evidenced thereby, (D) mature, with respect to each Loan evidenced thereby, five (5) Business Days prior to the Termination Date, (E) be subject to mandatory prepayment as provided in Section 4.3, (F) bear interest as provided in Section 3.1 in respect of the Base Rate Loans evidenced thereby and (G) be entitled to the benefits of this Agreement and the other applicable Loan Documents.

(b)     Notation of Payments.  Each Lender will note on its internal records the amount of each Loan made by it and each payment in respect thereof and will, prior to any transfer of any of its Notes, endorse on the reverse side thereof the outstanding principal amount of Loans evidenced thereby.  Failure to make any such notation shall not affect Borrower's or any guarantor's obligations hereunder or under the other applicable Loan Documents in respect of such Loans.

2.3    Minimum Amount of Each Borrowing; Maximum Number of Borrowings.  The aggregate principal amount of each Borrowing by Borrower hereunder shall be not less than (i) in the case of a Base Rate Loan, $5,000,000 and, if greater, shall be in integral multiples of $1,000,000 above such minimum (or, if less, the then Total Available Revolving Commitment) and (ii) in the case of a Eurodollar Loan, $5,000,000 and, if greater, shall be in integral multiples of $1,000,000 above such minimum and (iii) in the case of a Swing Line Loan, $1,000,000 and, if greater, shall be in integral multiples of $500,000 above such minimum.  More than one Borrowing may be incurred on any date; provided that at no time shall there be outstanding more than seven (7) Borrowings of Eurodollar Loans.

2.4    Borrowing Options. The Term Loans and the Revolving Loans shall, at the option of Borrower except as otherwise provided in this Agreement, be (i) Base Rate Loans, (ii) Eurodollar Loans, or (iii) part Base Rate Loans and part Eurodollar Loans.  As to any Eurodollar Loan, any Lender may, if it so elects, fulfill its commitment by causing a foreign branch or affiliate to make or continue such Loan, provided that in such event that Lender's Commitment Percentage of the Loan shall, for the purposes of this Agreement, be considered to have been made by that Lender and the obligation of Borrower to repay that Lender's Commitment Percentage of the Loan shall nevertheless be to that Lender and shall be deemed held by that Lender, for the account of such branch or affiliate.

2.5    Notice of Borrowing.  Whenever Borrower desires to make a Borrowing of any Loan hereunder, it shall give Agent at its office located at 90 Hudson Street, Fifth Floor, Jersey City, New Jersey, 07302 (or such other address as the Agent may hereafter designate in writing to the parties hereto) (the "Notice Address") at least one Business Day's prior written notice (or telephonic notice promptly confirmed in writing), given not later than 12:00 P.M. (New York City time) of each Base Rate Loan, and at least three Business Days' prior written notice (or telephonic notice promptly confirmed in writing), given not later than 12:00 P.M. (New York City time), of each Eurodollar Loan to be made hereunder; provided, however, that a Notice of Borrowing with respect to Borrowings to be made on the date hereof may, at the discretion of Agent, be delivered later than the time specified above.  Whenever Borrower desires that Swing Line Lender make a Swing Line Loan under Section 2.1(c), it shall deliver to Swing Line Lender prior to 11:00 A.M. (New York City time) on the date of Borrowing written notice (or telephonic notice promptly confirmed in writing).  Each such notice (each a "Notice of Borrowing"), which shall be in the form of Exhibit 2.5 hereto, shall be irrevocable, shall be deemed a representation by Borrower that all conditions precedent to such Borrowing have been satisfied and shall specify (i) the aggregate principal amount of the Loans to be made pursuant to such Borrowing, (ii) the date of Borrowing (which shall be a Business Day) and (iii) whether the Loans being made pursuant to such Borrowing are to be Base Rate Loans or Eurodollar Loans and, with respect to Eurodollar Loans, the Interest Period to be applicable thereto.  Agent shall as promptly as practicable give each Lender written or telephonic notice (promptly confirmed in writing) of each proposed Borrowing, of such Lender's Commitment Percentage thereof and of the other matters covered by the Notice of Borrowing.  Without in any way limiting Borrower's obligation to confirm in writing any telephonic notice, Agent or the Swing Line Lender (in the case of Swing Line Loans) may act without liability upon the basis of telephonic notice reasonably believed by Agent in good faith to be from a Responsible Officer of Borrower prior to receipt of written confirmation.  Agent's records shall, absent demonstrable error, be final, conclusive and binding on Borrower with respect to evidence of the terms of such telephonic Notice of Borrowing.

2.6    Conversion or Continuation.  Borrower may elect (i) on any Business Day occurring on or after the earlier of (i) the 30th day after the Initial Borrowing Date and (ii) the Syndication Date to convert Base Rate Loans or any portion thereof to Eurodollar Loans and (ii) at the end of any Interest Period with respect thereto, to convert Eurodollar Loans or any portion thereof into Base Rate Loans or to continue such Eurodollar Loans or any portion thereof for an additional Interest Period; provided, however, that the aggregate principal amount of the Eurodollar Loans for each Interest Period therefor must be in an aggregate principal amount of $5,000,000 or an integral multiple of $1,000,000 in excess thereof.  Each conversion or continuation of Revolving Loans shall be allocated among the Revolving Loans of the Revolving Lenders in accordance with their respective Commitment Percentages and each conversion or continuation of Term Loans shall be allocated among the Term Loans of the Term Lenders in accordance with their respective Commitment Percentages.  Each such election shall be in substantially the form of Exhibit 2.6 hereto (a "Notice of Conversion or Continuation") and shall be made by giving Agent at least three Business Days' prior written notice thereof to the Notice Address specifying (i) the amount and type of conversion or continuation, (ii) in the case of a conversion to or a continuation of Eurodollar Loans, the Interest Period therefor, (iii) whether such conversion or continuation is made with respect to Revolving Loans or Term Loans and (iv) in the case of a conversion, the date of conversion (which date shall be a Business Day and, if a conversion from Eurodollar Loans, shall also be the last day of the Interest Period therefor).  Notwithstanding the foregoing, no conversion in whole or in part of Base Rate Loans to Eurodollar Loans, and no continuation in whole or in part of Eurodollar Loans upon the expiration of any Interest Period therefor, shall be permitted at any time at which an Unmatured Event of Default or an Event of Default shall have occurred and be continuing.  If, within the time period required under the terms of this Section 2.6, Agent does not receive a Notice of Conversion or Continuation from Borrower containing a permitted election to continue any Eurodollar Loans for an additional Interest Period or to convert any such Loans, then, upon the expiration of the Interest Period therefor, such Loans will be automatically converted to Base Rate Loans.  Each Notice of Conversion or Continuation shall be irrevocable.

2.7    Disbursement of Funds; Funding Assumptions.

(a)     No later than 12:00 P.M. (New York City time) on the date specified in each Notice of Borrowing, each Lender will make available its Commitment Percentage of Revolving Loans of the Borrowing requested to be made on such date in Dollars and in immediately available funds, at the office (the "Payment Office") of Agent located at 90 Hudson Street, Fifth Floor, Jersey City, New Jersey, 07302 (for the account of such non-U.S. office of Agent as Agent may direct in the case of Eurodollar Loans) and Agent will make available to Borrower at its Payment Office the aggregate of the amounts so made available by the Lenders.

(b)     Unless Agent shall have been notified by any Lender at least one Business Day prior to the date of Borrowing that such Lender does not intend to make available to Agent such Lender's portion of the Loans to be purchased or Borrowing to be made on such date, Agent may assume that such Lender has made such amount available to Agent on such date of Borrowing and Agent may, but shall not be required to, in reliance upon such assumption, make available to Borrower a corresponding amount.  If such corresponding amount is not in fact made available to Agent by such Lender on the date of Borrowing, Agent shall be entitled to recover such corresponding amount on demand from such Lender. If such Lender does not pay such corresponding amount forthwith upon Agent's demand therefor, Agent shall promptly notify Borrower and, if so notified, Borrower shall immediately pay such corresponding amount to Agent.  Agent shall also be entitled to recover from Borrower interest on such corresponding amount in respect of each day from the date such corresponding amount was made available by Agent to Borrower to the date such corresponding amount is recovered by Agent, at a rate per annum equal to the rate for Base Rate Loans or Eurodollar Loans, as the case may be, applicable during the period in question, provided, however, that any interest paid to Agent in respect of such corresponding amount shall be credited against interest payable by Borrower to such lender under Section 3.1 in respect of such corresponding amount.  Any amount due hereunder to Agent from any Lender which is not paid when due shall bear interest payable by such Lender, from the date due until the date paid, at the Federal Funds Rate for the first three days after the date such amount is due and thereafter at the Federal Funds Rate plus 1%, together with Agent's standard interbank processing fee.  Further, such Lender shall be deemed to have assigned any and all payments made of principal and interest on its Loans,  amounts due with respect to its Letters of Credit (or its participations therein) and any other amounts due to it hereunder first to Agent to fund any outstanding Loans made available on behalf of such Lender by Agent pursuant to this Section 2.7 until such Loans have been funded (as a result of such assignment or otherwise) and then to fund Loans of all Lenders other than such Lender until each Lender has outstanding Loans equal to its Commitment Percentage of all Revolving Loans and Term Loans (as a result of such assignment or otherwise).  Such Lender shall not have recourse against Borrower with respect to any amounts paid to Agent or any Lender with respect to the preceding sentence; provided, that such Lender shall have full recourse against Borrower to the extent of the amount of such loans it has in fact made.  Nothing herein shall be deemed to relieve any Lender from its obligation to fulfill its Revolving Commitment hereunder or to prejudice any rights which Borrower may have against the Lender as a result of any default by such Lender hereunder.

2.8    Pro Rata Borrowings.  All Borrowings of Revolving Loans under this Agreement shall be loaned by the Lenders pro rata on the basis of their Revolving Commitments.  No Lender shall be responsible for any default by any other Lender in its obligation to make Loans hereunder and each Lender shall be obligated to make the Loans provided to be made by it hereunder, regardless of the failure of any other Lender to fulfill its Revolving Commitment or make Revolving Loans hereunder.

2.9    Amount and Terms of Letter of Credit.

(a)     Letter of Credit Commitments, Terms of Letters of Credit.

(i)     Subject to and upon the terms and conditions herein set forth and such other conditions as are applicable to its customers generally, at any time and from time to time on or after the Initial Borrowing Date and prior to the 30th Business Day preceding the Termination Date, the Facing Agent agrees to issue, in its own name, but for the ratable benefit of all Revolving Lenders (including Facing Agent) one or more Letters of Credit, each having a Stated Amount in Dollars and on a sight basis, for the account of Borrower in an aggregate undrawn amount at any one time outstanding that together with the aggregate Stated Amount of other Letters of Credit then outstanding, does not exceed $15,000,000; provided, however, that Facing Agent shall not issue or extend the expiration of any Letter of Credit if, immediately after giving effect to such issuance or extension, (A) the aggregate LC Obligations at such time would exceed $15,000,000, or (B) the Available Revolving Commitment of any Revolving Lender would be less than zero.  Each Revolving Lender severally, but not jointly, agrees to participate in each such Letter of Credit issued by Facing Agent to the extent of its Commitment Percentage and to make available to Facing Agent such Revolving Lender's Commitment Percentage of any payment made to the beneficiary of such Letter of Credit to the extent not reimbursed by Borrower; provided, however, that no Revolving Lender shall be required to participate in any Letter of Credit to the extent that such participation therein would exceed such Revolving Lender's Available Revolving Commitment then in effect; provided, further, that, after giving effect to the Issuance of any Letter of Credit, the aggregate amount of all LC Obligations, and the aggregate amount of all Revolving Loans and Swing Line Loans then outstanding, shall not exceed the lesser of (i) the Borrowing Base and (ii) the Total Revolving Commitment.  No Lender's obligation to participate in any Letter of Credit or to make available to Facing Agent such Revolving Lender's Commitment Percentage of any Letter of Credit Payment made by Facing Agent shall be affected by any other Revolving Lender's failure to participate in the same or any other Letter of Credit or by any other Revolving Lender's failure to make available to Facing Agent such other Revolving Lender's Commitment Percentage of any Letter of Credit Payment.  Notwithstanding the foregoing, in the event a Lender Default exists, Facing Agent shall not be required to issue any Letter of Credit unless Facing Agent has entered into arrangements satisfactory to it and Borrower to eliminate such Facing Agent's risk with respect to the participation in Letters of Credit of the Defaulting Lender or Lenders, including by cash collateralizing such Defaulting Lender's or Lenders' Commitment Percentage of the LC Obligations.  Schedule 2.9(a)(i) lists all Letters of Credit outstanding on the Third Amended and Restated Effective Date and which, for purposes of clarification, it is agreed shall remain outstanding under this Agreement.  

(ii)     Each Standby Letter of Credit issued or to be issued hereunder shall have an expiration date of one (1) year or less after the issuance date thereof; provided, however, that each Standby Letter of Credit may provide by its terms that it will be automatically extended for additional successive one (1) year periods unless Facing Agent shall have given notice to the applicable beneficiary of the election by Facing Agent (such election to be in the sole and absolute discretion of Facing Agent) not to extend such Letter of Credit; provided, further, that no Standby Letter of Credit or extension thereof shall be stated to expire later than the 10th Business Day preceding the date set forth in clause (a) of the definition of Termination Date.  Each Commercial Letter of Credit issued or to be issued hereunder shall have an expiration date not later than 180 days after the date of issuance or the date which is 30 Business Days preceding the Termination Date.

(b)     Procedure for Issuance of Letters of Credit.  Whenever Borrower desires the issuance of a Letter of Credit hereunder, it shall give Agent and Facing Agent at least three (3) Business Days' prior written notice (or such shorter period as may be agreed to by Borrower, Agent and Facing Agent) specifying the day of issuance thereof (which day shall be a Business Day), such notice to be given prior to 11:00 A.M. (New York City time) on the date specified for the giving of such notice.  Each such notice (each, a "Letter of Credit Request") shall be in the form of Exhibit 2.9 hereto and shall specify (A) the proposed issuance date and expiration date, (B) the name(s) of each obligor with respect to such Letter of Credit, (C) Borrower as the account party, (D) the name and address of the beneficiary (which Person shall be reasonably acceptable to Facing Agent), (E) the Stated Amount of such proposed Letter of Credit and (F) the purpose of such Letter of Credit and such other information as Facing Agent may reasonably request.  In addition, each Letter of Credit Request shall contain a description of the terms and conditions to be included in such proposed Letter of Credit.  Promptly after the issuance of or amendment to a Standby Letter of Credit, the Facing Agent shall notify the Borrower and the Agent, in writing, of such issuance or amendment, and such notice shall be accompanied by a copy of such issuance or amendment.  Upon receipt of such notice, the Agent shall notify the Revolving Lenders, in writing of such issuance or amendment and if requested to by a Revolving Lender, the Agent shall provide such Revolving Lender with a copy of such issuance or amendment.  With regards to Commercial Letters of Credit, the Facing Agent shall on the first Business Day of each week provide the Agent by facsimile with a report detailing the aggregate daily outstanding amount of Commercial Letters of Credit issued by such Facing Agent for the prior week.  Unless otherwise specified, all Letters of Credit will be governed by Uniform Customs and Practice for Documentary Credits (the "UCP").  On the Business Day specified by Borrower and upon fulfillment or waiver of the applicable conditions set forth in Article VI,  Facing Agent will issue the requested Letter of Credit to the applicable beneficiary.

(c)     Draws upon Letters of Credit; Reimbursement Obligation.  In the event of any drawing under any Letter of Credit by the beneficiary thereof (each such drawing until reimbursed, an "Unpaid Drawing"), Facing Agent shall give telephonic notice to Borrower and Agent (x) confirming such drawing and (y) of the date on or before which Facing Agent intends to honor such drawing, and Borrower shall reimburse Facing Agent on the day on which such drawing is honored in an amount in same day funds and like currency equal to the amount of such drawing; provided, however, that, anything contained in this Agreement to the contrary notwithstanding, (i) unless Borrower shall have notified Agent and Facing Agent prior to 11:00 A.M. (New York City time) on the Business Day Facing Agent intends to honor such drawing that Borrower intends to reimburse Facing Agent for the amount of such drawing with funds other than the proceeds of Revolving Loans, Borrower shall be deemed to have timely given a Notice of Borrowing to Agent requesting each Revolving Lender to make Revolving Loans which are Base Rate Loans on the date on which such drawing is honored in an amount equal to the amount of such drawing and (ii) subject to satisfaction or waiver of the conditions specified in Section 6.3, each such Revolving Lender shall, on the date of such drawing, make Revolving Loans which are Base Rate Loans in the amount of its Commitment Percentage of such drawing, the proceeds of which shall be applied directly by Agent to reimburse Facing Agent for the amount of such drawing; provided, further, that, if for any reason, proceeds of Revolving Loans are not received by Facing Agent on such date in an amount equal to the amount of such drawing, Borrower shall reimburse Facing Agent, on the Business Day immediately following the date of such drawing, in an amount in same day funds equal to the excess of the amount of such drawing over the amount of such Revolving Loans, if any, which are so received, plus accrued interest on such amount at the rate set forth in Section 3.1(a).

(d)     Lenders' Participation in Letters of Credit.  In the event that Borrower shall fail to reimburse Facing Agent as provided in Section 2.9(c) in an amount equal to the amount of any drawing honored by Facing Agent under a Letter of Credit issued by it in accordance with the terms hereof, Facing Agent shall promptly notify Agent and Agent shall promptly notify each Revolving Lender of the unreimbursed amount of such drawing and of such Revolving Lender's respective participation therein.  Each such Lender shall make available to Facing Agent an amount equal to its Commitment Percentage of such drawing in same day funds, at the office of Facing Agent specified in such notice, not later than 1:00 P.M. (New York City time) on the Business Day after the date such Revolving Lender is notified by Agent.  In the event that any such Revolving Lender fails to make available to Facing Agent the amount of such Revolving Lender's participation in such Letter of Credit as provided in this Section 2.9(d), Facing Agent shall be entitled to recover such amount on demand from such Lender together with interest at the Federal Funds Effective Rate for two Business Days and thereafter at the Base Rate.  Nothing in this Section 2.9(d) shall be deemed to prejudice the right of any Revolving Lender to recover from Facing Agent any amounts made available by such Revolving Lender to Facing Agent pursuant to this Section 2.9(d) in the event that it is determined that the payment with respect to a Letter of Credit by Facing Agent in respect of which payment was made by such Revolving Lender constituted gross negligence or willful misconduct as determined by a court of competent jurisdiction on the part of Facing Agent.  Facing Agent shall distribute to each other Revolving Lender which has paid all amounts payable by it under this Section 2.9(d) with respect to any Letter of Credit issued by Facing Agent such other Revolving Lender's Commitment Percentage of all payments received by Facing Agent from Borrower in reimbursement of drawings honored by Facing Agent under such Letter of Credit when such payments are received.  Upon any change in the Revolving Commitments of the Revolving Lenders pursuant to Section 3.7 or 12.8(c) or otherwise, it is hereby agreed that, with respect to all LC Obligations, there shall be an automatic adjustment to the participations pursuant to this Section 2.9(d) to reflect the new Commitment Percentages of the assigning Lender and the Assignee.

(e)     Fees for Letters of Credit.

(i)     Facing Agent.  Borrower agrees to pay the following amount to Facing Agent with respect to Letters of Credit issued by it for the account of Borrower:

(A)    with respect to drawings made under any Letter of Credit, interest, payable on demand, at a rate which is at all times equal to the sum of (i) 2% per annum, (ii) the Base Rate, and (iii) the Applicable Margin on the amount paid by Facing Agent in respect of each such drawing from the date of the drawing to the date such amount is reimbursed by Borrower (including any such reimbursement out of the proceeds of Revolving Loans pursuant to Section 2.9(c));

(B)    with respect to the issuance or amendment of each Letter of Credit and each drawing made thereunder, documentary and processing charges in accordance with Facing Agent's standard schedule for such charges in effect at the time of such issuance, amendment, transfer or drawing, as the case may be; and

(C)    a facing fee as agreed to between Borrower and the applicable Facing Bank for the applicable Letter of Credit and unless otherwise agreed, shall be payable with respect to the maximum Stated Amount under such outstanding Letters of Credit payable in arrears on the Quarterly Payment Date, on the Termination Date and thereafter, on demand together with customary issuance and drawing charges payable pursuant to clause (B) above; provided, however, if calculation of the facing fee in the manner set forth above would result in a facing fee of less than $500 per year per Letter of Credit, Borrower shall be obligated to pay such additional amount to the applicable Facing Bank so as to provide for a minimum facing fee of $500 per year per Letter of Credit.

(ii)     Participating Lender.  Borrower agrees to pay to Agent for distribution to each participating Revolving Lender in respect of all Letters of Credit outstanding such Revolving Lender's Commitment Percentage of a commission equal to the Applicable Eurodollar Rate Margin with respect to the daily Stated Amount under such outstanding Letters of Credit (the "LC Commission"), payable in arrears on each Quarterly Payment Date, on the Termination Date and thereafter, on demand.  The LC Commission shall be computed from the first day of issuance of each Letter of Credit and on the basis of the actual number of days elapsed over a year of 360 days.

Promptly upon receipt by Facing Agent or Agent of any amount described in clause (i)(A) and clause (ii) of this Section 2.9(e), Facing Agent or Agent shall distribute to each Revolving Lender that has reimbursed Facing Agent in accordance with Section 2.9(d) its Commitment Percentage of such amount.  Amounts payable under clauses (i)(A), (B) and (C) of this Section 2.9(e) shall be paid directly to Facing Agent.

(f)     LC Obligations Unconditional.  Subject to the last paragraph of Section 2.9(g), the obligation of Borrower to reimburse Facing Agent for drawings made under any Letter of Credit issued by it and the obligations of each Revolving Lender under Section 2.9(d) with respect thereto shall be unconditional and irrevocable and shall be paid strictly in accordance with the terms of this Agreement under all circumstances, including, without limitation, any of the following circumstances:

(i)     any lack of validity or enforceability of such Letter of Credit;

(ii)     the existence of any claim, setoff, defense or other right which Borrower or any of its Affiliates may have at any time against a beneficiary or any transferee of such Letter of Credit (or any persons or entities for which any such beneficiary or transferee may be acting), Facing Agent, any Lender or any other Person, whether in connection with this Agreement, the transactions contemplated herein or any unrelated transaction (including any underlying transaction between Borrower or one of its Subsidiaries and the beneficiary of such Letter of Credit);

(iii)    any draft, demand, certificate or any 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, provided the same appears on its face to comply with the draw requirements for the Letter of Credit;

(iv)    payment by Facing Agent under such Letter of Credit against presentation of a demand, draft or certificate or other document which does not comply with the terms of such Letter of Credit, provided the same appears on its face to comply with the draw requirements for the Letter of Credit;

(v)     the fact that an Event of Default or an Unmatured Event of Default shall have occurred and be continuing.

(g)     Indemnification.  In addition to amounts payable as elsewhere provided in this Agreement, Borrower hereby agrees to protect, indemnify, pay and save Facing Agent harmless from and against any and all claims, demands, liabilities, damages, losses, costs, charges and expenses (including reasonable attorneys fees) (other than for Taxes, which shall be covered by Section 4.7) which Facing Agent may incur or be subject to as a consequence, direct or indirect, of (i) the issuance of the Letters of Credit, other than as a result of the gross negligence or willful misconduct of Facing Agent as determined by a court of competent jurisdiction or (ii) the failure of Facing Agent to honor a drawing under any Letter of Credit as a result of any act or omissions, whether rightful or wrongful, of any present or future de jure or de facto government or Governmental Authority (all such acts or omissions herein called "Government Acts").  As between Borrower and Facing Agent, Borrower assumes all risks of the acts and omissions of, or misuse of the Letters of Credit issued by Facing Agent by, the respective beneficiaries of such Letters of Credit.  In furtherance and not in limitation of the foregoing, Facing Agent shall not be responsible: (i) for the form, validity, sufficiency, accuracy, genuineness or legal effect of any document submitted by any party in connection with the application for and issuance of or any drawing under such Letters of Credit, even if it should in fact prove to be in any or all respects invalid, insufficient, inaccurate, fraudulent or forged, provided such document appears on its face to comply with the requirements applicable to it; (ii) for the validity or sufficiency of any instrument transferring or assigning or purporting to transfer or assign any such Letter of Credit or the rights or benefits thereunder or proceeds thereof, in whole or in part, which may prove to be invalid or ineffective for any reason; (iii) for failure of the beneficiary of any such Letter of Credit to comply fully with conditions required in order to draw upon such Letter of Credit; (iv) for errors, omissions, interruptions or delays in transmission or delivery of any messages, by mail, cable, telegraph, telex or otherwise, whether or not they be in cipher; (v) for errors in interpretation of technical terms; (vi) for any loss or delay in the transmission or otherwise of any document required in order to make a drawing under any such Letter of Credit or of the proceeds thereof; (vii) for the misapplication by the beneficiary of any such Letter of Credit of the proceeds of any drawing under such Letter of Credit; and (viii) for any consequences arising from causes beyond the control of Facing Agent, including, without limitation, any Government Acts.  None of the above shall affect, impair, or prevent the vesting of any of Facing Agent's rights or powers hereunder.

In furtherance and extension and not in limitation of the specific provisions hereinabove set forth, any action taken or omitted by Facing Agent under or in connection with the Letters of Credit issued by it or the related certificates, if taken or omitted in good faith, shall not put Facing Agent under any resulting liability to Borrower.  Notwithstanding anything to the contrary contained in this Agreement, Borrower shall have no obligation to indemnify Facing Agent in respect of any liability incurred by Facing Agent arising solely out of the gross negligence or willful misconduct of Facing Agent.  The right of indemnification in the first paragraph of this Section 2.9(g) shall not prejudice any rights that Borrower may otherwise have against Facing Agent with respect to a Letter of Credit issued hereunder.

 (h)    Increased Costs.  If at any time after the Closing Date, any Facing Agent or any Lender determines that the introduction of or any change in any applicable law, rule, regulation, order, guideline or request or in the interpretation or administration thereof by any Governmental Authority charged with the interpretation or administration thereof, or compliance by such Facing Agent or such Lender with any request or directive by any such authority (whether or not having the force of law), shall either (i) impose, modify or make applicable any reserve, deposit, capital adequacy or similar requirement against Letters of Credit issued by Facing Agent or participated in by any Lender, or (ii) impose on any Facing Agent or any Lender any other conditions relating, directly or indirectly, to this Agreement or any Letter of Credit; and the result of any of the foregoing is to increase the cost to any Facing Agent or any Lender of issuing, maintaining or participating in any Letter of Credit, or reduce the amount of any sum received or receivable by any Facing Agent or any Lender hereunder or reduce the rate of return on its capital with respect to Letters of Credit, then, upon demand to Borrower by Facing Agent or any Lender (a copy of which demand shall be sent by such Facing Agent or such Lender to Agent), Borrower shall pay to such Facing Agent or such Lender such additional amount or amounts as will compensate such Facing Agent or such Lender for such increased cost or reduction in the amount receivable or reduction on the rate of return on its capital.  In determining such additional amounts pursuant to the preceding sentence, such Facing Agent or such Lender will act reasonably and in good faith and will, to the extent the increased costs or reductions in amounts receivable or reductions in rates of return relate to such Facing Agent's or such Lender's letters of credit in general and are not specifically attributable to the Letters of Credit hereunder, use averaging and attribution methods which are reasonable and which cover all letters of credit similar to the Letters of Credit issued by or participated in by such Facing Agent or such Lender whether or not the documentation for such other Letters of Credit permit such Facing Agent or such Lender to receive amounts of the type described in this Section 2.9(i).  Any Facing Agent or any Lender, upon determining that any additional amounts will be payable pursuant to this Section 2.9(i), will give prompt written notice thereof to Borrower, which notice shall include a certificate submitted to Borrower by such Facing Agent or such Lender (a copy of which certificate shall be sent by such Facing Agent or such Lender to Agent), setting forth in reasonable detail the basis for the calculation of such additional amount or amounts necessary to compensate such Facing Agent or such Lender, although failure to give any such notice shall not release or diminish Borrower's obligations to pay additional amounts pursuant to this Section 2.9(i) provided that Borrower shall not be required to compensate a Lender or a Facing Agent pursuant to this section for any increased costs or reductions incurred more than 180 days prior to the date that such Lender or such Facing Agent, as the case may be, notifies Borrower of the additional amounts and of such Lender's or Facing Agent's intention to claim compensation therefor; provided further that, if the change in law giving rise to such increased costs or reductions is retroactive, then the 180-day period referred to above shall be extended to include the period of retroactive effect thereof. The certificate required to be delivered pursuant to this Section 2.9(i) shall, absent demonstrable error, be final, conclusive and binding on Borrower and the Facing Agent or the Lender, as applicable.

ARTICLE III
INTEREST AND FEES

3.1    Interest.

(a)     Base Rate Loans.  Borrower agrees to pay interest in respect of the unpaid principal amount of each Base Rate Loan at a rate per annum equal to the Base Rate plus the Applicable Margin from the date the proceeds thereof are made available to Borrower until the earlier of (i) the maturity (whether by acceleration or otherwise) of such Base Rate Loan or (ii) the conversion of such Base Rate Loan to a Eurodollar Loan pursuant to Section 2.6.

(b)     Eurodollar Loans.  Borrower agrees to pay interest in respect of the unpaid principal amount of each Eurodollar Loan from the date the proceeds thereof are made available to Borrower until the earlier of (i) the maturity (whether by acceleration or otherwise) of such Eurodollar Loan or (ii) the conversion of such Eurodollar Loan to a Base Rate Loan pursuant to Section 2.6 at a rate per annum equal to the relevant Eurodollar Rate plus the Applicable Margin

(c)     Payment of Interest.  Interest on each Loan shall be payable in arrears on each Interest Payment Date; provided, however, that interest accruing pursuant to Section 3.1(e) shall be payable from time to time on demand.  Interest shall also be payable on all then outstanding Loans on the Termination Date and on all Loans on the date of repayment (including prepayment) thereof (except that voluntary prepayments of Revolving Loans that are Base Rate Loans made pursuant to Section 4.2 on any day other than an Interest Payment Date or the Termination Date need not be made with accrued interest from the most recent Quarterly Payment Date, provided such accrued interest is paid on the next Interest Payment Date) and on the date of maturity (by acceleration or otherwise) of such Loans.  During the existence of any Event of Default, interest on any Loan shall be payable on demand.

(d)     Notification of Rate.  Agent, upon determining in accordance herewith the interest rate for any Borrowing of Eurodollar Loans for any Interest Period, shall promptly notify Borrower and the Lenders thereof.  Such determination shall, absent demonstrable error and subject to Section 3.6, be final, conclusive and binding upon all parties hereto.

(e)     Default Interest.  Notwithstanding the rates of interest specified herein, effective on the date 30 days after the occurrence and continuance during such 30 day period of any Event of Default (other than the failure to pay Obligations when due) and for so long thereafter as any Event of Default shall be continuing, and effective immediately upon any failure to pay any Obligations or any other amounts due under any of the Loan Documents when due, whether by acceleration or otherwise, the principal balance of each Loan then outstanding and, to the extent permitted by applicable law, any interest payment on each Loan not paid when due or other amounts then due and payable shall bear interest payable on demand, after as well as before judgment at a rate per annum equal to the Default Rate.

(f)     Maximum Interest.  If any interest payment or other charge or fee payable hereunder exceeds the maximum amount then permitted by applicable law, Borrower shall be obligated to pay the maximum amount then permitted by applicable law and Borrower shall continue to pay the maximum amount from time to time permitted by applicable law until all such interest payments and other charges and fees otherwise due hereunder (in the absence of such restraint imposed by applicable law) have been paid in full.

3.2    Fees.

(a)     Commitment Fee.  On each Quarterly Payment Date, and on the Termination Date (or, if earlier, on the date upon which the Revolving Commitments are terminated and the Loans are paid in full and the LC Obligations are paid in full or cash collateralized in a manner satisfactory to Agent), Borrower shall pay to Agent, for the ratable benefit of the Lenders, a commitment fee equal to the Applicable Commitment Fee which accrued during the quarterly period most recently ended (or, in the case of the payment due on the Termination Date, the portion thereof ending on such date).  Such commitment fee shall be based upon the average unused Revolving Commitments of the Lenders during the preceding quarter.

(b)     Agency Fees.  Borrower shall pay to Agent for its own account, agency and other Loan fees in the amount and at the times set forth in the letter agreement between Borrower and Agent.

(c)     Third Amended and Restated Credit Agreement Fees.  In consideration of the execution of the Third Amended and Restated Credit Agreement by the Agent and the Lenders, the Borrower hereby agrees to pay to each Lender executing this Agreement a fee in an amount equal to (a) such Lender's Revolving Commitment in effect on the Third Amended and Restated Effective Date (after giving effect to the Third Amended and Restated Credit Agreement) plus the aggregate outstanding principal amount of such Lender's Term Loans multiplied by (b) 0.500%.  

(d)     July 1, 2003 Special Fee.  Borrower shall pay on July 1, 2003, a special one-time fee to each Lender in an amount equal to (a) such Lender's Revolving Commitment (as in effect on such date) plus the aggregate outstanding principal amount of such Lender's Term Loans (as outstanding on such date) multiplied by (b) 0.750%.  

3.3    Computation of Interest and Fees.  Interest on all Loans and fees payable hereunder shall be computed on the basis of the actual number of days elapsed over a year of 360 days; provided that interest on all Base Rate Loans shall be computed on the basis of the actual number of days elapsed over a year of 365 or 366 days, as the case may be.  Each determination of an interest rate by Agent pursuant to any provision of this Agreement and in accordance therewith shall be conclusive and binding on Borrower, Agent and the Lenders in the absence of demonstrable error.  Agent shall, at any time and from time to time upon request of Borrower, deliver to Borrower a statement showing the quotations used by Agent in determining any interest rate applicable to Loans pursuant to this Agreement.  Each change in the Applicable Margin, the Applicable Commitment Fee or any change in the applicable LC Commission as a result of a change in Borrower's Most Recent Ratio of Total Debt to EBITDA shall become effective on the Adjustment Date.

3.4    Interest Periods.  At the time it gives any Notice of Borrowing or a Notice of Conversion or Continuation with respect to Eurodollar Loans, Borrower shall elect, by giving Agent written notice, the interest period (each an "Interest Period") which Interest Period shall, at the option of Borrower, be one, two, three or six months, provided that:

(i)     all Eurodollar Loans comprising a single Borrowing shall at all times have the same Interest Period;

(ii)     the initial Interest Period for any Eurodollar Loan shall commence on the date of such Borrowing of such Eurodollar Loan (including the date of any conversion thereto from a Loan of a different Type) and each Interest Period occurring thereafter in respect of such Eurodollar Loan shall commence on the last day of the immediately preceding Interest Period;

(iii)    if any Interest Period relating to a Eurodollar Loan begins on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period, such Interest Period shall end on the last Business Day of such calendar month;

(iv)    if any Interest Period would otherwise expire on a day which is not a Business Day, such Interest Period shall expire on the next succeeding Business Day; provided, however, that if any Interest Period for a Eurodollar Loan would otherwise expire on a day which is not a Business Day but is a day of the month after which no further Business Day occurs in such month, such Interest Period shall expire on the next preceding Business Day;

(v)     no Interest Period may be selected at any time when an Unmatured Event of Default or Event of Default is then in existence; and

(vi)    no Interest Period shall extend beyond the Termination Date.

3.5    Compensation for Funding Losses.

(a)     Borrower shall compensate each Lender, upon its written request (which request shall set forth in reasonable detail the basis for requesting such amounts), for all losses, expenses and liabilities (including, without limitation, any interest paid by such Lender to lenders of funds borrowed by it to make or carry its Eurodollar Loans to the extent not recovered by the Lender in connection with the liquidation or re-employment of such funds and including the compensation payable by such Lender to a Participant but excluding loss of anticipated profit with respect to any Loans) and any loss sustained by such Lender in connection with the liquidation or re-employment of such funds (including, without limitation, a return on such liquidation or re-employment that would result in such Lender receiving less than it would have received had such Eurodollar Loan remained outstanding until the last day of the Interest Period applicable to such Eurodollar Loans) which such Lender may sustain as a result of (regardless of whether such events occur as a result of an Event of Default or Unmatured Event of Default or the exercise of any right or remedy of Agent or the Lenders under this Agreement or any other agreement, or at law): (i) any failure by Borrower to continue or borrow, or convert from or into, Eurodollar Loans on a date specified therefor in a Notice of Borrowing or Notice of Conversion or Continuation delivered by Borrower (whether or not withdrawn); (ii) any payment, prepayment or conversion or continuation of any of its Eurodollar Loans occurring for any reason whatsoever on a date which is not the last day of an Interest Period applicable thereto; (iii) any repayment of any of its Eurodollar Loans not being made on the date specified in a notice of payment given by Borrower; or (iv) (A) any other failure by Borrower to repay its Eurodollar Loans when required by the terms of this Agreement or (B) an election made by Borrower pursuant to Section 3.7.  Such a written request as to additional amounts owed such Lender under this Section 3.5 and delivered to Borrower and Agent by such Lender shall, absent demonstrable error, be final, conclusive and binding for all purposes.

(b)     Calculation of all amounts payable to a Lender under this Section 3.5 shall be made as though that Lender had actually funded its relevant Eurodollar Loan through the purchase of a Eurodollar deposit bearing interest at the Eurodollar Rate in an amount equal to the amount of that Loan, having a maturity comparable to the relevant Interest Period and through the transfer of such Eurodollar deposit from an offshore office of that Lender to a domestic office of that Lender in the United States of America; provided, however, that each Lender may fund each of its Eurodollar Loans in any manner it sees fit and the foregoing assumption shall be utilized only for the calculation of amounts payable under this Section 3.5.

3.6    Increased Costs, Illegality, Etc.

(a)     Generally.  In the event that:

(i)     on any Interest Rate Determination Date, by reason of any changes arising after the date of this Agreement affecting the interbank Eurodollar market, adequate and fair means do not exist for ascertaining the applicable interest rate on the basis provided for in the definition of Eurodollar Rate; or

(ii)     at any time, any Lender shall incur increased costs or reduction in the amounts received or receivable hereunder with respect to any Eurodollar Loan because of (x) any change since the date of this Agreement in any applicable law or governmental rule, regulation, order, guideline or request (whether or not having the force of law) or in the interpretation or administration thereof and including the introduction of any new law or governmental rule, regulation, order, guideline or request, such as, for example, but not limited to: (A) a change in the basis of taxation of payments to any Lender of the principal of or interest on the Notes or any other amounts payable hereunder (except for (a) changes in the rate of tax on, or determined by reference to, the net income or profits of such Lender imposed by the jurisdiction in which its principal office or applicable lending office is located and (b) United States withholding taxes, which shall be governed by the provisions of Section 4.6) or (B) a change in official reserve requirements (but, in all events, excluding reserves required under Regulation D to the extent included in the computation of the Eurodollar Rate) and/or (y) other circumstances since the date of this Agreement affecting such Lender or the interbank Eurodollar market or the position of such Lender in such market (excluding, however, differences in a Lender's cost of funds from those of Agent which are solely the result of credit differences between such Lender and Agent); or

(iii)    at any time, the making or continuance of any Eurodollar Loan has been made (x) unlawful by any law or governmental rule, regulation or order, (y) impossible by compliance by any Lender in good faith with any governmental request (whether or not having force of law) or (z) impracticable as a result of a contingency occurring after the date of this Agreement which materially and adversely affects the interbank Eurodollar market;

then, and in any such event, such Lender (or Agent, in the case of clause (i) above) shall promptly give notice (by telephone confirmed in writing), which notice shall, absent demonstrable error, be final and conclusive and binding upon all parties hereto, to Borrower and, except in the case of clause (i) above, to Agent of such determination (which notice Agent shall promptly transmit to each of the other Lenders).  Thereafter (x) in the case of clause (i) above, Eurodollar Loans shall no longer be available until such time as Agent notifies Borrower and the Lenders that the circumstances giving rise to such notice by Agent no longer exist, and any Notice of Borrowing or Notice of Conversion or Continuation given by Borrower with respect to Eurodollar Loans (other than with respect to conversions to Base Rate Loans) which have not yet been incurred (including by way of conversion) shall be deemed rescinded by Borrower, (y) in the case of clause (ii) above, Borrower shall pay to such Lender, upon written demand therefor, such additional amounts (in the form of an increased rate of, or a different method of calculating, interest or otherwise as such Lender shall reasonably determine) as shall be required to compensate such Lender for such increased costs or reductions in amounts received or receivable hereunder (a written notice as to the additional amounts owed to such Lender, showing the basis for the calculation thereof, submitted to Borrower by such Lender shall, absent demonstrable error, be final and conclusive and binding on all the parties hereto; however the failure to give any such notice shall not release or diminish Borrower's obligations to pay additional amounts pursuant to this Section 3.6 (a)(y) provided that Borrower shall not be required to compensate such Lender pursuant to this section for any increased costs or reductions incurred more than 180 days prior to the date that such Lender notifies Borrower of the increased costs or reductions and of such Lender's intention to claim compensation therefor; provided further that, if the change in law giving rise to such increased costs or reductions is retroactive, then the 180-day period referred to above shall be extended to include the period of retroactive effect thereof and (z) in the case of clause (iii) above, Borrower shall take one of the actions specified in Section 3.6(b) as promptly as possible and, in any event, within the time period required by law.  In determining such additional amounts pursuant to clause (y) of the immediately preceding sentence, each Lender shall act reasonably and in good faith and will, to the extent the increased costs or reductions in amounts receivable relate to such Lender's loans in general and are not specifically attributable to a Loan hereunder, use averaging and attribution methods which are reasonable and which cover all loans similar to the Loans made by such Lender whether or not the loan documentation for such other loans permits the Lender to receive increased costs of the type described in this Section 3.6(a).

(b)     Eurodollar Loans.  At any time that any Eurodollar Loan is affected by the circumstances described in Section 3.6(a)(ii) or (iii), Borrower may (and, in the case of a Eurodollar Loan affected by the circumstances described in Section 3.6(a)(iii), shall) either (i) if the affected Eurodollar Loan is then being made initially or pursuant to a conversion, cancel the respective Borrowing by giving Agent telephonic notice (confirmed in writing) on the same date that Borrower was notified by the affected Lender or Agent pursuant to Section 3.6(a)(ii) or (iii), or (ii) if the affected Eurodollar Loan is then outstanding, upon at least three Business Days' written notice to Agent, require the affected Lender to convert such Eurodollar Loan into a Base Rate Loan, provided, that if more than one Lender is affected at any time, then all affected Lenders must be treated the same pursuant to this Section 3.6(b).

(c)     Capital Requirements.  If any Lender determines that the introduction of or any change in any applicable law or governmental rule, regulation, order, guideline or request (whether or not having the force of law) concerning capital adequacy, or any change in (after the date of this Agreement) interpretation or administration thereof by any Governmental Authority, central bank or comparable agency, will have the effect of increasing the amount of capital required or expected to be maintained by such Lender or any corporation controlling such Lender based on the existence of such Lender's Revolving Commitment or Term Loans hereunder or its obligations hereunder, then Borrower shall pay to such Lender, upon its written demand therefor, such additional amounts as shall be required to compensate such Lender or such other corporation for the increased cost to such Lender or such other corporation or the reduction in the rate of return to such Lender or such other corporation as a result of such increase of capital.  In determining such additional amounts, each Lender will act reasonably and in good faith and will use averaging and attribution methods which are reasonable and which will, to the extent the increased costs or reduction in the rate of return relates to such Lender's commitments or obligations in general and are not specifically attributable to the Revolving Commitments, Term Loans and obligations hereunder, cover all commitments and obligations similar to the Revolving Commitment or Term Loans and obligations of such Lender hereunder whether or not the loan documentation for such other commitments or obligations permits the Lender to make the determination specified in this Section 3.6(c), and such Lender's determination of compensation owing under this Section 3.6(c) shall, absent demonstrable error, be final and conclusive and binding on all the parties hereto.  Each Lender, upon determining that any additional amounts will be payable pursuant to this Section 3.6(c), will give prompt written notice thereof to Borrower, which notice shall show in reasonable detail the basis for calculation of such additional amounts, although the failure to give any such notice shall not release or diminish any of Borrower's obligations to pay additional amounts pursuant to this Section 3.6(c) provided that Borrower shall not be required to compensate such Lender pursuant to this Section 3.6(c) for any increased costs or reductions incurred more than 180 days prior to the date that such Lender notifies Borrower of the increased costs or reductions and of such Lender's intention to claim compensation therefor; provided further that, if the change in law giving rise to such increased costs or reductions is retroactive, then the 180-day period referred to above shall be extended to include the period of retroactive effect thereof.

(d)     Change of Lending Office.  Each Lender which is or will be owed compensation pursuant to Section 3.6(a) or (c) will, if requested by Borrower, use reasonable efforts (subject to overall policy considerations of such Lender) to cause a different branch or Affiliate to make or continue a Loan or Letter of Credit if such designation will avoid the need for, or materially reduce the amount of, such compensation to such Lender and will not, in the judgment of such Lender, be otherwise disadvantageous to such Lender.  Borrower hereby agrees to pay all reasonable expenses incurred by any Lender in utilizing a different branch or Affiliate pursuant to this Section 3.6(d).  Nothing in this Section 3.6(d) shall affect or postpone any of the obligations of Borrower or the right of any Lender provided for herein.

3.7    Replacement of Affected Lenders.  (x) If any Lender becomes a Defaulting Lender or otherwise defaults in its Obligations to make Revolving Loans or fund Unpaid Drawings, (y) if any Lender is owed increased costs under Section 3.6(a)(ii) or (iii), Section 3.6(c) or Borrower is required to make any payments under Section 4.6 to any Lender materially in excess of those to the other Lenders or (z) as provided in Section 11.1(b) in the case of certain refusals by a Lender to consent to certain proposed amendments, changes, supplements, waivers, discharges or terminations with respect to this Agreement which have been approved by the Required Lenders, Borrower shall have the right, if no Event of Default or Unmatured Event of Default then exists, to replace such Lender (the "Replaced Lender") with one or more other Eligible Assignee or Eligible Assignees, none of whom shall be a Defaulting Lender at the time of such replacement (collectively, the "Replacement Lender") acceptable to Agent, provided that (i) at the time of any replacement pursuant to this Section 3.7, the Replacement Lender shall enter into one or more assignment agreements, in the form of Exhibit 11.9 hereto, pursuant to which the Replacement Lender shall acquire all of the Commitments and outstanding Loans of the Replaced Lender and (ii) all obligations of Borrower owing to the Replaced Lender (including, without limitation, any such increased costs and excluding those specifically described in clause (i) above in respect of which the assignment purchase price has been, or is concurrently being paid) shall be paid in full to such Replaced Lender concurrently with such replacement.  Upon the execution of the respective assignment documentation, the payment of amounts referred to in clauses (i) and (ii) above and, if so requested by the Replacement Lender, delivery to the Replacement Lender of the appropriate Note or Notes executed by Borrower, the Replacement Lender shall become a Lender hereunder and the Replaced Lender shall cease to constitute a Lender hereunder, except with respect to indemnification provisions under this Agreement, which shall survive as to such Replaced Lender.  Notwithstanding anything to the contrary contained above, no Lender that acts as a Facing Agent may be replaced hereunder at any time which it has Letters of Credit outstanding hereunder unless arrangements satisfactory to such Facing Agent (including the furnishing of a standby letter of credit in form and substance, and issued by an issuer satisfactory to such Facing Agent or the depositing of cash collateral into the Collateral Account in amounts and pursuant to arrangements satisfactory to such Facing Agent) have been made with respect to such outstanding Letters of Credit.

ARTICLE IV
REDUCTION OF COMMITMENTS; PAYMENTS AND PREPAYMENTS

4.1    Voluntary Reduction of Commitments.  Upon at least three Business Days' prior written notice (or telephonic notice confirmed in writing) to Agent at the Notice Office (which notice Agent shall promptly transmit to each Lender), Borrower shall have the right, from time to time and without premium or penalty, to terminate the unutilized portion of the Revolving Commitments or the Swing Line Commitment, as the case may be, in part or in whole; provided that (x) any such voluntary termination of the Revolving Commitments shall apply to proportionately and permanently reduce the Revolving Commitment of each Revolving Lender, (y) any partial voluntary reduction pursuant to this Section 4.1 shall be in the amount of at least $5,000,000 and integral multiples of $5,000,000 in excess of that amount and (z) no such voluntary termination of the Revolving Commitments shall be permitted if the effect thereof would be to reduce the total of the Revolving Commitments below the aggregate principal amount of outstanding Revolving Loans plus the aggregate LC Obligations and the Swing Line Loan Commitment.  The parties hereto acknowledge that the Borrower on the Restatement Date and prior to the Term Loan Conversion permanently reduced the Revolving Commitments by the amount of the Revolver Commitment Reduction .  The parties hereto further acknowledge that on the Third Amended and Restated Effective Date the Borrower further permanently reduced the Revolving Commitments by $20,000,000.

4.2    Voluntary Prepayments.  (a)  Borrower shall have the right to prepay any or all of the Loans in whole or in part from time to time on the following terms and conditions: (i) Borrower shall give Agent irrevocable written notice at its Notice Office (or telephonic notice promptly confirmed in writing) of its intent to prepay, the amount of such prepayment and the specific Borrowings to which such prepayment is to be applied, which notice shall be given by Borrower to Agent by 12:00 noon (New York City time) at least three Business Days prior to the date of such prepayment and which notice shall (except in the case of Swing Line Loans) promptly be transmitted by Agent to each of the applicable Lenders; (ii) each partial prepayment of any Borrowing (other than a Borrowing of Swing Line Loans) shall be in an aggregate principal amount of at least $1,000,000 and each partial prepayment of a Swing Line Loan shall be in an aggregate principal amount of at least $500,000; provided that no partial prepayment of Eurodollar Loans made pursuant to a single Borrowing shall reduce the aggregate principal amount of the outstanding Loans made pursuant to such Borrowing to an amount less than the Minimum Borrowing Amount applicable thereto; (iii) Eurodollar Loans may only be prepaid pursuant to this Section 4.2 on the last day of an Interest Period applicable thereto or on any other day subject to Section 3.5; (iv) each prepayment in respect of any Borrowing shall be applied pro rata among the Loans comprising such Borrowing provided, that such prepayment shall not be applied to any Loans of a Defaulting Lender at any time when the aggregate amount of Loans of any Non-Defaulting Lender exceeds such Non-Defaulting Lender's Commitment Percentage of all Loans then outstanding.  Voluntary prepayments of Term Loans may not be made utilizing proceeds of Revolving Loans or Swing Line Loans and shall be applied first to the Scheduled Term A Repayments and the Scheduled Term B Repayments due within the 6 month period following the date of such prepayment in direct order of maturity and, thereafter, shall be applied in proportional amounts equal to the Term A Percentage and Term B Percentage (in each case, after giving effect to the prepayments made to the Scheduled Term A Repayments and Scheduled Term B Repayments due within such 6 month period as specified above), as the case may be, of such remaining prepayment, if any, and within each Term Loan, shall be applied to reduce the remaining Scheduled Term A Repayments and Scheduled Term B Repayments on a pro rata basis. The notice provisions, the provisions with respect to the minimum amount of any prepayment, and the provisions requiring prepayments in integral multiples above such minimum amount of this Section 4.2 are for the benefit of Agent and may be waived unilaterally by Agent.

(b)     In the event of certain refusals by a Lender to consent to certain proposed amendments, changes, supplements, waivers, discharges or terminations with respect to this Agreement which have been approved by the Required Lenders as provided in Section 11.1(b), Borrower shall have the right, upon five (5) Business Days' prior written notice to Agent (which notice Agent shall promptly transmit to each of the Lenders), to repay all Loans, together with accrued and unpaid interest, fees  and all other amounts due and owing to such Lender in accordance with said Section 11.1(b), so long as (A) in the case of the repayment of Revolving Loans of any Revolving Lender pursuant to this clause (b), the Revolving Commitment of such Revolving Lender is terminated concurrently with such repayment pursuant to Section 4.1(b) and (B) in the case of the repayment of Loans of any Lender, the consents required by Section 11.1(b) in connection with the repayment pursuant to this clause (b) shall have been obtained.

4.3    Mandatory Prepayments.

(a)     Prepayment Upon Overadvance.  Borrower shall prepay the outstanding principal amount of the Revolving Loans or the Swing Line Loan on any date on which the aggregate outstanding principal amount of such Loanstogether with the aggregate LC Obligations (after giving effect to any other repayments or prepayments on such day) exceeds the aggregate Revolving Commitments or the Swing Line Loan Commitment, as the case may be, in the amount of such excess; provided, however, if at any time the aggregate of all Revolving Loans then outstanding plus the aggregate amount of all LC Obligations and Swing Line Loans then outstanding exceeds the lesser of (i) the Borrowing Base and (ii) the Total Revolving Commitment, the Borrower shall immediately, and without notice or demand, prepay the outstanding principal amount of the Revolving Loans and Swing Line Loans by an amount equal to the applicable excess.  If, after giving effect to the prepayment of all outstanding Revolving Loans, the aggregate LC Obligations exceeds the lesser of (i) the Borrowing Base and (ii) the Total Revolving Commitment then in effect, Borrower shall cash collateralize LC Obligations by depositing, pursuant to a cash collateral agreement to be entered into in form and substance reasonably satisfactory to Agent and Borrower, cash with Agent in an amount equal to the difference between such LC Obligations and the lesser of (i) the Borrowing Base and (ii) the Total Revolving Commitment then in effect.  Agent shall establish in its name for the benefit of the Revolving Lenders a cash collateral account (the "Collateral Account") into which it shall deposit such cash to hold as collateral security for the LC Obligations.

(b)     Payment at Termination Date.  Borrower hereby unconditionally promises to pay to each Lender on the Termination Date, the unpaid principal amount of each Loan (including, without limitation, each Swing Line Loan) made by such Lender.  Borrower hereby further agrees to pay interest in immediately available funds at the office of Agent on the unpaid principal amount of such Loans from time to time from the date hereof until payment in full thereof at the rates per annum, and on the dates, set forth in Section 2.6.

(c)     Mandatory Prepayment Upon Asset Disposition.  On the first Business Day after the date of receipt thereof by Borrower and/or any of its Subsidiaries of Net Sale Proceeds from any Asset Disposition, an amount equal to 100% of the Net Sale Proceeds from such Asset Disposition shall be applied as a mandatory repayment of principal of the Loans as provided in Section 4.4.

(d)     Mandatory Prepayment Upon Incurrence of Indebtedness.  On the date of receipt by Borrower and/or any of their Subsidiaries of Net Offering Proceeds from the incurrence of Indebtedness, an amount equal to 100% of such Net Offering Proceeds shall be applied as a mandatory prepayment of Loans in the manner set forth in Section 4.4.

(e)     Scheduled Term Repayments.  

       (i)     Scheduled Term A Repayments. Borrower agrees to pay Scheduled Term A Repayments on the Term A Loans until the Term A Loans are paid in full in the amounts and at the times specified in the definition of Scheduled Term A Repayments to the extent that prepayments have not previously been applied to such Scheduled Term A Repayments (and such Scheduled Term A Repayments have not otherwise been reduced) pursuant to the terms hereof.

       (ii)     Scheduled Term B Repayments. Borrower agrees to pay Scheduled Term B Repayments on the Term B Loans until the Term B Loans are paid in full in the amounts and at the times specified in the definition of Scheduled Term B Repayments to the extent that prepayments have not previously been applied to such Scheduled Term B Repayments (and such Scheduled Term B Repayments have not otherwise been reduced) pursuant to the terms hereof.

(f)     Mandatory Prepayment With Excess Cash Flow.  On each Excess Cash Payment Date, an amount equal to 75% of Excess Cash Flow, if positive, of Borrower and its Subsidiaries for the most recent Excess Cash Flow Period ending prior to such Excess Cash Payment Date shall be applied as a mandatory repayment of principal of the Loans as provided in Section 4.4.

(g)     Mandatory Prepayment Upon Recovery Event.  Within fifteen (15) days following each date on which Borrower or any of its Subsidiaries receives any proceeds from any Recovery Event, an amount equal to 100% of the proceeds of such Recovery Event (net of reasonable costs and taxes incurred in connection with such Recovery Event) shall be applied as a mandatory repayment of principal of the Loans as provided in Section 4.4, provided that (1) so long as no Event of Default or Unmatured Event of Default then exists, if the net proceeds from any Recovery Event are less than $500,000, then no prepayment shall be required pursuant to this Section 4.3(g), and (2) so long as no Event of Default or Unmatured Event of Default then exists, with respect to any single or series of related Recovery Events the net proceeds therefrom which are equal to or greater than $500,000 but less than $1,000,000, such proceeds shall not be required to be so applied on such date to the extent that Borrower has delivered a certificate to the Agent on or prior to such date stating that such proceeds shall be used to replace or restore any properties or assets in respect of which such proceeds were paid within 180 days following the date of the receipt of such proceeds (which certificate shall set forth the estimates of the proceeds to be so expended) provided, further, that (i) if the amount of such proceeds from any single or series of related Recovery Events exceeds $1,000,000, then the entire amount and not just the portion in excess of $1,000,000 shall be applied as a mandatory repayment of Loans as provided above in this Section 4.3(g) and (ii) if all or any portion of such proceeds not required to be applied to the repayment of Loans pursuant to the first proviso of this Section 4.3(g) are not so used (or contractually committed to be used) within 180 days after the day of the receipt of such proceeds, such remaining portion shall be applied on the last day of such period as a mandatory repayment of principal of the Loans as provided in this Section 4.3(g).

4.4    Application of Prepayments. Except as expressly provided in this Agreement, all prepayments of principal made by Borrower pursuant to Section 4.3(c),(d), (f) and (g) shall be applied (i) first to the payment of the unpaid principal amount of the Term Loans (with the Term A Percentage of such repayment to be applied as a repayment of Term A Loans and the Term B Percentage of such repayment to be applied as a repayment of Term B Loans), after all Term A and Term B Loans have been paid in full, second to the payment of the then outstanding balance of the Revolving Loans and third, after all Revolving Loans have been paid in full, to the cash collateralization of LC Obligations; (ii) within each of the foregoing Loans, first to the payment of Base Rate Loans and second to the payment  of Eurodollar Loans; and (iii) with respect to Eurodollar Loans, in such order as Borrower shall request (and in the absence of such request, as Agent shall determine so as to minimize breakage costs).  Each prepayment of the Term Loans pursuant to Sections 4.3(c) and (d)  shall be applied to the Term Loans in proportional amounts equal to the Term A Percentage and Term B Percentage, as the case may be, of such remaining prepayment, if any and, within each Term Loan, shall be applied first to the Scheduled Term A Repayments and the Scheduled Term B Repayments due within the 6 month period following the date of such prepayment in direct order of maturity and, thereafter to reduce the remaining Scheduled Term A Repayments and Scheduled Term B Repayments on a pro rata basis (based upon the then remaining principal amount of such Scheduled Term A Repayments and Scheduled Term B Repayments, respectively).  Each prepayment of the Term Loans pursuant to Sections 4.3(f) and (g) shall be applied to the Term Loans in proportional amounts equal to the Term A Percentage and Term B Percentage, as the case may be, of such remaining prepayment, if any and, within each Term Loan, shall be applied to reduce the remaining Scheduled Term A Repayments and Scheduled Term B Repayments on a pro rata basis (based upon the then remaining principal amount of such Scheduled Term A Repayments and Scheduled Term B Repayments, respectively).  If any prepayment of Eurodollar Loans made pursuant to a single Borrowing shall reduce the outstanding Loans made pursuant to such Borrowing to an amount less than the Minimum Borrowing Amount, such Borrowing shall immediately be converted into Base Rate Loans.  All prepayments shall include payment of accrued interest on the principal amount so prepaid, shall be applied to the payment of interest before application to principal and shall include amounts payable, if any, under Section 3.5.

4.5    Method and Place of Payment.

(a)     Except as otherwise specifically provided herein, all payments under this Agreement shall be made to Agent, for the ratable account of the Lenders entitled thereto, not later than 12:00 Noon (New York City time) on the date when due and shall be made in immediately available funds in lawful money of the United States of America and in each case to the account specified therefor for Agent or if no account has been so specified at the Payment Office, it being understood that with respect to payments in Dollars, written telex or telecopy notice by Borrower to Agent to make a payment from the funds in Borrower's account at the Payment Office shall constitute the making of such payment to the extent of such funds held in such account.  Agent will thereafter cause to be distributed on the same day (if payment was actually received by Agent prior to 12:00 Noon (New York City time) on such day) like funds relating to the payment of principal or interest or fees ratably to the Lenders entitled to receive any such payment in accordance with the terms of this Agreement.  If and to the extent that any such distribution shall not be so made by Agent in full on the same day (if payment was actually received by Agent prior to 12:00 Noon (New York City time) on such day), Agent shall pay to each Lender its ratable amount thereof and each such Lender shall be entitled to receive from Agent interest on such amount at the overnight Federal Funds Rate for each day from the date such amount is paid to Agent until the date Agent pays such amount to such Lender.

(b)     Any payments under this Agreement which are made by Borrower later than 12:00 Noon (New York City time) shall, for the purpose of calculation of interest, be deemed to have been made on the next succeeding Business Day.  Whenever any payment to be made hereunder shall be stated to be due on a day which is not a Business Day, the due date thereof shall be extended to the next succeeding Business Day and, with respect to payments of principal, interest shall be payable during such extension at the applicable rate in effect immediately prior to such extension, except that with respect to Eurodollar Loans, if such next succeeding Business Day is not in the same month as the date on which such payment would otherwise be due hereunder or under any Note, the due date with respect thereto shall be the next preceding applicable Business Day.

4.6    Net Payments.

(a)     All payments made by Borrower hereunder or under any Loan Document will be made without setoff, counterclaim or other defense.  Except as provided in Section 4.7(d), all payments hereunder and under any of the Loan Documents (including, without limitation, payments on account of principal and interest and fees) shall be made by Borrower free and clear of and without deduction or withholding for or on account of any present or future tax, duty, levy, impost, assessment or other charge of whatever nature now or hereafter imposed by any Governmental Authority, but excluding therefrom (i) a tax imposed on or measured by the net income, net profits, net receipts or capital (including a branch profits tax or a franchise tax based on net income, net profits, net receipts or capital) of the Lender by the jurisdiction (or political subdivision or taxing authority thereof) in which the Lender is incorporated or organized, or in which it is a citizen, resident or domiciliary or the jurisdiction (or political subdivision or taxing authority thereof) in which any lending office that participated in the making of a loan hereunder is located, (ii) in the case of any Lender organized under the laws of any jurisdiction other than the United States or any state thereof (including the District of Columbia), any taxes imposed by the United States by means of withholding at the source unless, and to the extent that, such withholding results from a change in applicable law, treaty or regulations or the interpretation or administration thereof (including, without limitation, any guideline or policy not having the force of law) by any authority charged with the administration thereof subsequent to the date such Lender becomes a Lender with respect to the Loan or portion thereof affected by such change and (iii) any tax imposed on or measured by the net income, net profits, net receipts or capital (including a branch profits tax, or a franchise tax based on net income, net profits, net receipts or capital) of a Lender or an office or branch thereof by the United States of America or any political subdivision or taxing authority thereof or therein (such tax or taxes, other than a tax or taxes excluded under (i), (ii), or (iii), being herein referred to as "Tax" or "Taxes" and tax or taxes excluded under (i), (ii) or (iii) shall be referred to as "Excluded Taxes").  If Borrower is required by law to make any deduction or withholding of any Taxes from any payment due hereunder or under any of the Loan Documents, then the amount payable will be increased to such amount which, after deduction from such increased amount of all such Taxes required to be withheld or deducted therefrom, will not be less than the amount due and payable hereunder had no such deduction or withholding been required.  A certificate as to any additional amounts payable to a Lender under this Section 4.6 submitted to Borrower by such Lender shall show in reasonable detail the amount payable and the calculations used to determine in good faith such amount and shall, absent manifest error, be final, conclusive and binding upon all parties hereto.

(b)     If Borrower makes any payment hereunder or under any of the Loan Documents in respect of which it is required by law to make any deduction or withholding of any Taxes, it shall pay the full amount to be deducted or withheld to the relevant taxation or other authority within the time allowed for such payment under applicable law and shall deliver to all affected Lenders within 30 days after it has made such payment to the applicable authority any receipt issued by such authority to the Borrower evidencing the payment to such authority of all amounts so required to be deducted or withheld from such payment.

(c)     Without prejudice to the other provisions of Section 4.6, if any Lender, or Agent on its behalf, is required by law to make any payment on account of Taxes on or in relation to any amount received or receivable hereunder or under any of the Loan Documents by such Lender, or Agent on its behalf, or any liability for Tax in respect of any such payment is imposed, levied or assessed against any Lender or Agent on its behalf, Borrower will promptly, following receipt of the certificate described in the immediately following sentence, indemnify such person against such Tax payment or liability, together with any interest, penalties and expenses (including reasonable counsel fees and expenses) payable or incurred in connection therewith, including any tax of any Lender arising by virtue of payments under this Section 4.6(c), computed in a manner consistent with this Section 4.6(c).  A certificate prepared in good faith as to the amount of such payment (showing in reasonable detail the amount payable and the calculations used to determine such amount) by such Lender, or Agent on its behalf, absent manifest error, shall be final, conclusive and binding upon all parties hereto for all purposes.

(d)     Each Lender that is not a United States person (as such term is defined in Section 7701(a)(30) of the Code) agrees to deliver to Borrower and Agent on or prior to the Third Amended and Restated Effective Date, or in the case of a Lender that is an Assignee of an interest under this Agreement pursuant to Section 3.7 or 11.9 (unless the respective Lender was already a Lender hereunder immediately prior to such assignment), on the date of such assignment to such Lender, (i) two accurate and complete original signed copies of IRS Form W-8BEN, W-8ECI, or W-8IMY (or successor or other applicable forms prescribed by the IRS) certifying to such Lender's entitlement to a complete exemption from or reduced rate of United States withholding tax on interest payments to be made under this Agreement and under any Note, or (ii) if the Lender is not a "bank" within the meaning of Section 881(c)(3)(A) of the Code and cannot deliver the applicable form pursuant to clause (i) above, (x) a certificate substantially in the form of Exhibit 4.6(d) (any such certificate, a "Section 4.6(d)(ii) Certificate") and (y) two accurate and complete original signed copies of IRS Form W-8BEN (or successor form), certifying to such Lender's entitlement to a complete exemption from United States withholding tax on payments of interest to be made under this Agreement and under any Note; provided, however, that no Lender shall be required to deliver an IRS Form W-8BEN, W-8ECI, W-8IMY, or Section 4.6(d)(ii) Certificate under this Section 4.6(d) to the extent that the delivery of such form is not authorized by law; provided further, however, that in the event that a Lender provides the Borrower or the Agent with an IRS Form W-8IMY (or substitute form) indicating that it is a "flow through" entity, as defined in Treasury Regulations promulgated under Section 1441 of the Code, or otherwise, not a beneficial owner of interest payments under this Agreement and under any Note, such Lender agrees, on or prior to the Third Amended and Restated Effective Date, or the date of assignment to such Lender, as applicable, to take any actions necessary, and to deliver to Borrower and Agent all forms necessary, to establish such Lender's entitlement to a complete exemption from, or a reduction in, United States withholding tax on payments of interest to be made under this Agreement and under any Note, including causing its partners, members, beneficiaries, beneficial owners, and their beneficial owners, if any, to take any actions and deliver any forms necessary to establish such exemption.  Notwithstanding the foregoing, (i) a fiscally transparent entity may provide an IRS Form W-8BEN to claim a treaty exemption or rate reduction to the extent that such entity is receiving interest and is not treated as fiscally transparent by its own jurisdiction,  provided the satisfaction of such conditions entitles the Lender to an exemption or reduction from withholding at the time such Lender becomes a party to this Agreement and (ii) a withholding foreign partnership, withholding foreign trust, and qualified intermediary shall only provide such information as is required by Treasury Regulations promulgated under Code Section 1441.  For purposes of this Agreement, the term "Forms" shall include any attachments for to IRS Forms W-8 IMY required to be filed by the Lender.  In addition, each Lender agrees that from time to time after the Initial Borrowing Date, when a lapse in time or change in circumstances renders the previous certification obsolete or inaccurate in any material respect, such Lender will deliver to Borrower and Agent two new accurate and complete original signed copies of an IRS Form W-8BEN, W-8ECI, or W-8IMY and a Section 4.6(d)(ii) Certificate, as the case may be, and such other forms as may be required in order to confirm or establish the entitlement of such Lender (or its partners, members, beneficiaries, or beneficial owners) to a continued exemption from or reduction in United States withholding Tax on interest payments under this Agreement and any Note, or it shall immediately notify Borrower and Agent of its inability to deliver any such form or certificate; provided, however, that no Lender shall be required to deliver an IRS Form W8-BEN, W-8ECI, or W-8IMY under this Section 4.6(d) to the extent that the delivery of such form is not authorized by law; provided, further, however, that any Lender which does not deliver the applicable form pursuant to Section 4.6(d) shall be entitled to additional payment pursuant to Section 4.6(a) or indemnification under Section 4.6(c) only if and to the extent (i) such failure results solely from a change in law or (ii) the Tax to which such additional payment or indemnification relates would have been imposed regardless of whether such Lender provided such forms.  Notwithstanding anything to the contrary contained in Section 4.6, any Lender that has not provided to Borrower the IRS Forms required to be provided to Borrower pursuant to this Section 4.6(d) shall not be entitled to any payment of additional amounts pursuant to Section 4.6(a) or indemnification under Section 4.6(c) with respect to any deduction or withholding which would not have been required if such Lender had provided such forms.

(e)     Each Lender that is incorporated or organized under the laws of the United States of America or a state thereof shall provide two properly completed and duly executed copies of IRS Form W-9, or any successor or other applicable form.  Each Lender shall deliver to Borrower and Agent (provided that such Lender remains lawfully able to do so), two further duly executed forms and statements, properly completed in all material respects, at or before 4he time any such form or statement expires or becomes obsolete, or otherwise as reasonably requested by Borrower.  Each Lender shall promptly notify Borrower at any time it determines that it is no longer in a position to provide any previously delivered certificate to Borrower (or any other form or certification adopted by U.S. taxing authorities for such purpose).

(f)     Each Lender agrees that, as promptly as practicable after it becomes aware of the occurrence of any event or the existence of any condition that would cause Borrower to make a payment in respect of any Taxes to such Lender pursuant to Section 4.6(a) or a payment in indemnification for any Taxes pursuant to Section 4.6(c), it will use reasonable efforts to make, fund or maintain the Loan (or portion thereof) of such Lender with respect to which the aforementioned payment is or would be made through another lending office of such Lender or take any other action reasonably requested by Borrower if as a result thereof the additional amounts which would otherwise be required to be paid by such Borrower in respect of such Loans (or portions thereof) or participation in Letters of Creditpursuant to Section 4.6(a) or Section 4.6(c) would be materially reduced, and if, as determined by such Lender, in its reasonable discretion, the making, funding or maintaining of such Loans or participation in Letters of Credit (or portions thereof) through such other lending office or taking of such other action would not otherwise materially adversely affect such Loans or such Lender.  Borrower agrees to pay all reasonable expenses incurred by any Lender in utilizing another lending office of such Lender or taking of such other action pursuant to this Section 4.6(f).

ARTICLE V
REPRESENTATIONS AND WARRANTIES

To induce Agent and each Lender to enter into this Agreement and the Third Amended and Restated Credit Agreement and to make the Loans and issue (or participate in) the Letters of Credit, Borrower hereby represents and warrants to Agent and each Lender, and hereby agrees, as follows:

5.1    Corporate Existence; Compliance with Law.  Each of Borrower and its Subsidiaries (a) is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization, (b) has the corporate power and authority, and the legal right, to own and operate its property, to lease the property it operates as lessee and to conduct the business in which it is currently engaged, (c) is duly qualified and in good standing as a foreign corporation, and is duly authorized to do business, in each jurisdiction where its ownership or leasing of property or the character of its operations makes such qualification necessary, except where the failure to so qualify would not reasonably be expected to have a Material Adverse Effect and (d) is in compliance with all Requirements of Law except to the extent that all failures to comply therewith would not reasonably be expected to have a Material Adverse Effect.

5.2    Corporate Power; Authorization; No Violation.  The execution, delivery and performance by each Credit Party of this Agreement and the other Loan Documents to which it is a party (i) are within such Credit Party's corporate power, (ii) have been duly authorized by all necessary corporate, shareholder and other action on the part of each Person whose authorization is required, (iii) do not violate any Requirement of Law or any material Contractual Obligation applicable to such Credit Party, (iv) will not result in or require the creation or imposition of any Lien of any nature upon or with respect to any of the properties now owned or hereafter acquired by such Person (other than any permitted by the Loan Documents) and (v) will not require any authorization or approval or other action by, or notice to or filing or registration with, any Governmental Authority (other than those which have been obtained and are in force and effect).

5.3    Binding Effect.  This Agreement has been, and the other Loan Documents to which any Credit Party is a party will be when executed and delivered, duly executed and delivered on behalf of Borrower and the other Loan Parties thereto.  This Agreement constitutes, and the other Loan Documents to which any Credit Party is a party when executed and delivered will constitute, a legal, valid and binding obligation of the Loan Parties that are party thereto, enforceable against such Loan Parties in accordance with their respective terms, except as enforcement thereof may be subject to (i) the effect of any applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors' rights generally and (ii) general principles of equity (regardless of whether such enforcement is sought in a proceeding in equity or at law).  The security interests created in favor of Agent, as Pledgee for the benefit of the Lenders under the Pledge Agreement constitute first perfected security interests in the Pledged Stock, subject to no security interests of any other Person.  No filings or recordings are required in order to perfect the security interests created in the Pledged Stock under the Pledge Agreement.

5.4    Purpose of Loans.  The proceeds of the Loans shall be used by Borrower to (i) repay existing indebtedness under the Existing Credit Agreements and (ii) for general corporate and working capital purposes (including without limitation the Asset Acquisition and other Acquisitions).  No proceeds of any of the Loans will be used for "buying," "purchasing," or "carrying," any "margin stock" within the respective meanings of each of the quoted terms under Regulation U of the Board as now and from time to time hereafter in effect or for any purpose which would cause any of the loans or extensions of credit under this Agreement to be considered a "purpose credit" within the meaning of Regulation T, U or X of the Board.  Notwithstanding anything else herein to the contrary, no proceeds of any Revolving Loans will be used to effect (either directly or indirectly) a voluntary or mandatory prepayment of Term Loans hereunder.

5.5    Subsidiaries.  Schedule 5.5 annexed hereto and made a part hereof is a complete and correct list of all Subsidiaries of Borrower as of the Third Amended and Restated Effective Date and separately identifies all Material Subsidiaries of Borrower as of the Third Amended and Restated Effective Date.  All of such Subsidiaries are Wholly‑Owned Subsidiaries of Borrower except as otherwise indicated on such Schedule 5.5.  There does not exist any encumbrance or restriction on the ability of (i) any Subsidiary of Borrower to pay dividends or make any other distributions on its capital stock or any other interest or participation in its profits owned by Borrower or any Subsidiary of Borrower, or to pay any Indebtedness owed to Borrower or a Subsidiary of Borrower, (ii) any Subsidiary of Borrower to make loans or advances to Borrower or any of Borrower's Subsidiaries or (iii) Borrower or any of its Subsidiaries to transfer any of its properties or assets to Borrower or any of its Subsidiaries, except for such encumbrances or restrictions existing under or by reason of (x) applicable law, (y) this Agreement or the other Loan Documents or (z) customary provisions restricting subletting or assignment of any lease or other contract governing a leasehold interest or other contract rights of Borrower or a Subsidiary of Borrower.

5.6    Indebtedness.  Schedule 5.6 annexed hereto and made a part hereof is a complete and correct list of all Indebtedness of Borrower and its Subsidiaries which, in any individual instance exceeds $250,000 in principal amount and which is outstanding as of the Third Amended and Restated Effective Date (other than Intercompany Indebtedness).

5.7    Financial Statements; Financial Condition; Undisclosed Liabilities; Projections, etc.

(a)     Financial Statements.  The balance sheet of Borrower at December 31, 1998, December 31, 1999, December 31, 2000 and December 31, 2001, and the related statements of operations, cash flows and shareholders' equity of Borrower for the Fiscal Year or other period ended on such dates, as the case may be, copies of which have been furnished to the Lenders prior to the date hereof which have been examined by Ernst & Young L.L.P., independent certified public accountants, were prepared in accordance with GAAP in effect on the date such statements were prepared and fairly present the consolidated financial condition and results of operations of the Borrower and its Subsidiaries at such dates and for the periods then ended.  Since December 31, 2001, there has been no Material Adverse Effect.

(b)     Solvency.  On and as of the Third Amended and Restated Effective Date, after giving effect to the Third Amended and Restated Credit Agreement and to all Indebtedness (including the Loans) being incurred, and to be incurred (and the use or proceeds thereof), and Liens created, and to be created, by Borrower in connection with the transactions contemplated hereby, (i) the sum of the assets, at a fair valuation, of Borrower will exceed its Debts; (ii) Borrower has not incurred nor intends to, nor believes that it will, incur Debts beyond its ability to pay such Debts as such Debts mature; and (iii) Borrower will have sufficient capital with which to conduct its business.

(c)     No Undisclosed Liabilities.  Except as fully reflected in the financial statements and the notes thereto referred to in Section 5.7(a) or on Schedule 5.7(c), there are (after giving effect to the Third Amended and Restated Credit Agreement and the other transactions contemplated hereby) no liabilities or obligations with respect to Borrower of any nature whatsoever (whether absolute, accrued, contingent or otherwise and whether or not due) which, either individually or in aggregate, would be material to Borrower.  As of the Third Amended and Restated Effective Date (and after giving effect to the Third Amended and Restated Credit Agreement and the other transaction contemplated hereby), Borrower does not know of any basis for the assertion against Borrower of any liability or obligation of any nature whatsoever that is not reflected in such financial statements or the notes related thereto delivered pursuant to Section 5.7(a) or on Schedule 5.6 which, either individually or in the aggregate, could reasonably be expected to be material to Borrower.

(d)     Projections.  On and as of the Third Amended and Restated Effective Date, the financial projections, attached hereto as Schedule 5.7(d) (the "Projections") have been prepared on a basis consistent with the financial statements referred to in Section 5.7(a) and are based on good faith estimates and assumptions made by the management of Borrower, and there are no statements or conclusions in any of the Projections which are based upon or include information known to Borrower to be misleading or which fail to take into account material information known to Borrower regarding the matters reported therein.  On the Third Amended and Restated Effective Date, Borrower believed that the Projections were reasonable and attainable, it being understood that uncertainty is inherent in any forecasts or projections and that no assurance can be given that the results set forth in the Projections will actually be obtained.

5.8    No Material Litigation.  There are no actions, suits, proceedings or investigations pending or, to the knowledge of Borrower, threatened against Borrower or any of its Subsidiaries or any of its or their respective properties or assets before any arbitrator or Governmental Authority (a) with respect to this Agreement or any other Loan Document or any of the actions contemplated hereby or thereby, or (b) which would reasonably be expected to have a Material Adverse Effect.

5.9    Performance of Agreements.  Neither Borrower nor any of its Subsidiaries is in default in the performance, observance or fulfillment of any of the obligations, covenants or conditions contained in any Contractual Obligation of Borrower or any of its Subsidiaries and no event or condition has occurred or become known or exists which with notice or the lapse of time or both would constitute such a default except where such default or defaults, if any, would not reasonably be expected to have a Material Adverse Effect.

5.10   Taxes.  Borrower and each of its Subsidiaries has filed or caused to be filed all material tax returns and reports which are required to be filed, and has paid all taxes shown to be due and payable on said returns or on any assessments made against it or any of its properties or assets and all other taxes, fees and other charges imposed on its or any of their respective properties by any Governmental Authority other than those the amount or validity of which are currently being contested in good faith by appropriate proceedings diligently pursued and with respect to which reserves in conformity with GAAP have been provided on the books of Borrower and/or its Subsidiaries, as applicable) and no material tax Lien has been filed or received.  There is no proposed tax assessment against Borrower or any of its Subsidiaries which would reasonably be expected to have a Material Adverse Effect.

5.11   Governmental Regulation.  (i)  Neither Borrower nor any of its Subsidiaries is an "investment company" or a company "controlled" by a company required to be registered as an "investment company" within the meaning of the Investment Company Act of 1940, as amended, and (ii) neither Borrower nor any of its Subsidiaries is engaged directly or indirectly, principally, or as one of its important activities, in the business of extending, or arranging for the extension of, credit for the purposes of purchasing or carrying any margin stock, within the meaning of Regulation T, U or X of the Board.

5.12   Ownership of Property; Liens.  Each of Borrower and its Subsidiaries has good and indefeasible title in fee simple to, or a valid leasehold interest in, all its material real property, and good title to, or a valid leasehold interest in, all its other material property, and none of such property is subject to any Lien except for Permitted Liens.

5.13   Intellectual Property.  Borrower and each of its Subsidiaries owns, or is licensed to use, all trademarks, tradenames, copyrights, technology, know-how, patents and processes necessary for the conduct of its business as currently conducted, except for those the failure to own or be licensed to use, which would not reasonably be expected to have a Material Adverse Effect (the "Intellectual Property").  No claim has been asserted and is pending by any Person challenging or questioning the use of any such Intellectual Property or the validity or effectiveness of any such Intellectual Property, nor does Borrower know of any valid basis for any such claim except for such claims and infringements that, in the aggregate, would not reasonably be expected to have a Material Adverse Effect.  To Borrower's or any of its Subsidiaries' knowledge, the use of such Intellectual Property by Borrower and its Subsidiaries does not infringe on the rights of any Person, in each case except for such claims and infringements that, in the aggregate, would not reasonably be expected to have a Material Adverse Effect.

5.14   Disclosure.  This Agreement and any other document, certificate or statement furnished to Agent or any Lender by or on behalf of Borrower or any of its Subsidiaries, taken as a whole, do not contain any untrue statement of a material fact and do not omit to state a material fact necessary in order to make the statements contained herein and therein not misleading when made.  There is no fact known to Borrower or any of its Subsidiaries which now has or in the future would reasonably be expected to have (so far as Borrower or any of its Subsidiaries can now reasonably foresee) a Material Adverse Effect which has not been disclosed in this Agreement, or in the other documents and certificates furnished to Agent and each Lender specifically for use in connection with the transactions contemplated hereby.

5.15   ERISA.  Borrower and each of its ERISA Affiliates are in compliance in all material respects with applicable provisions of ERISA and the Code and the regulations and published interpretations thereunder with respect to all Plans and, to the best of Borrower's knowledge, all Multiemployer Plans, except where noncompliance would not reasonably be expected to have a Material Adverse Effect.  No Termination Event has occurred or is reasonably expected to occur with respect to any Plan.  The sum of the "amounts of unfunded benefit commitments" (as defined in Section 4001(a)(18) of ERISA) under all Plans (excluding each Plan with an amount of unfunded benefit commitments of zero or less) is not more than $7,500,000.  The aggregate Withdrawal Liability under all Multiemployer Plans is not more than $7,500,000.

5.16   Labor Relations.  Except to the extent that such practices, circumstances, events or questions would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, (a) neither Borrower nor any of its Subsidiaries is engaged in any unfair labor practice and (b) no significant strike, labor dispute, slowdown or stoppage is pending against Borrower or any of its Subsidiaries or, to the best knowledge of Borrower, threatened against Borrower or any of its Subsidiaries.

5.17   Insurance.  Except as otherwise permitted by Section 7.8, the properties of Borrower and its Subsidiaries are insured with financially sound and reputable insurance companies, in such amounts, with such deductibles and covering such risks as are customarily carried by Persons engaged in the same or similar businesses.

5.18   Public Utility Holding Company Act.  Neither Borrower nor any of its Subsidiaries is a "holding company," or a "subsidiary company" of a "holding company," or an "affiliate" of a "holding company" or of a "subsidiary company" of a "holding company," within the meaning of the Public Utility Holding Company Act of 1935, as amended.

5.19   Security Documents.  

(a)     Security Agreement Collateral.  The provisions of each Security Agreement  are effective to create in favor of Collateral Agent for the benefit of the Secured Creditors a legal, valid and enforceable security interest in all right, title and interest of the relevant Credit Party in the Collateral, and each Security Agreement, together with the timely filings of Form UCC-1 creates a fully perfected first lien on, and security interest in, all right, title and interest of the relevant Credit Party in all of the Collateral described therein, subject to no other Liens other than Permitted Liens.  Each Credit Party has good and marketable title to, or rights in, all Collateral, free and clear of all Liens except Permitted Liens.

(b)     Real Estate Collateral.  (i) The Ramsey Mortgage executed on the Restatement Date creates, as security for the obligations purported to be secured thereby, a valid and enforceable perfected security interest in and Lien on the Mortgaged Property thereunder for the benefit of the Secured Creditors, superior to and prior to the rights of all third Persons (except that the security interest created in the Mortgaged Property thereunder may be subject to the Permitted Liens related thereto and any Liens referred to in the Ramsey Mortgage Policy) and subject to no other Liens (other than Permitted Real Property Encumbrances and any Liens referred to in the Ramsey Mortgage Policy).

(ii) The Cortland Mortgage creates, as security for the obligations purported to be secured thereby, a valid and enforceable perfected security interest in and Lien on the Mortgaged Property thereunder for the benefit of the Secured Creditors, superior to and prior to the rights of all third Persons (except that the security interest created in the Mortgaged Property thereunder may be subject to the Permitted Liens related thereto and any Liens referred to in the Cortland Mortgage Policy) and subject to no other Liens (other than Permitted Real Property Encumbrances and any Liens referred to in the Cortland Mortgage Policy).  

5.20   Matters Pertaining to Second Amendment and Restatement Agreement.  

(a)     Representations and Warranties.  Each of the representations and warranties given by Borrower in the Agreement are true and correct in all material respects as of the Restatement Date, except to the extent such representations and warranties are expressly made as of a specified date in which event such representations and warranties shall be true and correct as of such specified date.

(b)     Corporate Power; Authorization; No Violation.  The execution, delivery and performance by each Credit Party of the Second Amendment and Restatement Agreement and the other Loan Documents to which it is a party (i) are within such Credit Party's corporate power, (ii) have been duly authorized by all necessary corporate, shareholder and other action on the part of each Person whose authorization is required, (iii) do not violate any Requirement of Law or any material Contractual Obligation applicable to such Credit Party, (iv) will not result in or require the creation or imposition of any Lien of any nature upon or with respect to any of the properties now owned or hereafter acquired by such Person (other than any permitted by the Loan Documents) and (v) will not require any authorization or approval or other action by, or notice to or filing or registration with, any Governmental Authority (other than those which have been obtained and are in force and effect).

5.21   Matters Pertaining to Third Amended and Restated Credit Agreement.  

(a)     Representations and Warranties.  Each of the representations and warranties given by Borrower in the Agreement are true and correct in all material respects as of the Third Amended and Restated Effective Date, except to the extent such representations and warranties are expressly made as of a specified date in which event such representations and warranties shall be true and correct in all material respects as of such specified date.

(b)     Corporate Power; Authorization; No Violation.  The execution, delivery and performance by each Credit Party of the Third Amended and Restated Credit Agreement and the other Loan Documents to which it is a party (i) are within such Credit Party's corporate power, (ii) have been duly authorized by all necessary corporate, shareholder and other action on the part of each Person whose authorization is required, (iii) do not violate any Requirement of Law or any material Contractual Obligation applicable to such Credit Party, (iv) will not result in or require the creation or imposition of any Lien of any nature upon or with respect to any of the properties now owned or hereafter acquired by such Person (other than any permitted by the Loan Documents) and (v) will not require any authorization or approval or other action by, or notice to or filing or registration with, any Governmental Authority (other than those which have been obtained and are in force and effect).

5.22   Deposit Accounts.  Schedule 5.22 lists all banks and other financial institutions at which any Credit Party maintains deposits and/or other accounts as of the Third Amended and Restated Effective Date and such Schedule correctly identifies the name, city and state of each depository, the name in which the account is held and the complete account number.

ARTICLE VI
CONDITIONS OF CREDIT

6.1    Conditions Precedent to Effectiveness.  The parties acknowledge and agree that the Second Amendment and Restatement Agreement became effective upon the satisfaction or waiver of each of the following conditions:

(a)     Loan Documents.  Agent shall have received each of:

(i)                  the Second Amendment and Restatement Agreement, executed and delivered by a duly authorized officer of Borrower, the Agent and the Required Lenders;

(ii)                for the account of each Lender requesting the same, Notes conforming to the requirements hereof and executed by a duly authorized officer of Borrower;

(iii)               a Security Agreement executed and delivered by a duly authorized officer of Borrower and each Subsidiary Guarantor substantially in the form of Exhibit 6.1(a)(iii) hereto (as amended, restated, supplemented or otherwise modified from time to time, in the case of the Borrower the "Original Borrower Security Agreement" and in the case of the Subsidiary Guarantors the "Original Subsidiary Guarantor Security Agreement" collectively with the Borrower Security Agreement, the "Original Security Agreements") together with:

(a)     proper financing statements (Form UCC-1 or such other financial statements or similar notices as shall be required by local law) duly prepared for filing under the UCC or other appropriate filing offices of each jurisdiction as may be necessary or, in the opinion of Agent, desirable to perfect the security interests purported to be created by the Original Security Agreements;

 (b)    evidence of the completion of all other recordings and filings of, or with respect to, the Security Agreements and all other actions as may be necessary or, in the opinion of Agent, desirable to perfect the security interests intended to be created by the Original Security Agreements;

 (c)    evidence that all other actions necessary, or in the reasonable opinion of Agent, desirable to perfect the security interests purported to be granted by the Original Security Agreements have been taken;

(iv)    the Amended and Restated Pledge Agreement executed and delivered by a duly authorized officer of Borrower substantially in the form of Exhibit 6.1(a)(iv) hereto (as amended, restated, supplemented or otherwise modified from time to time, the "Pledge Agreement") and all the Pledged Securities referred to therein then owned, if any, by such Credit Party, (x) endorsed in blank in the case of promissory notes constituting Pledged Securities and (y) together with executed and undated stock powers, in the case of capital stock constituting Pledged Securities, or other transfer assignment instruments in form and substance satisfactory to Agent, in the case of membership interests constituting Pledged Securities and (z) the Pledge Agreement and such other documents shall be in full force and effect, and each Credit Party which is a limited liability company shall have certificated all existing membership interests and delivered to Agent, as pledgee, such pledged certificates as Pledged Securities;

(v)     the Amended and Restated Guaranty executed and delivered by a duly authorized officer of each Subsidiary Guarantor substantially in the form of Exhibit 6.1(a)(v) (as amended, restated, supplemented or otherwise modified from time to time, the "Subsidiary Guaranty"); and

(vi)    the Ramsey Mortgage in the form of Exhibit 6.1(a)(vi)(i), executed by Borrower's Subsidiary, Vision Ease Lens, Inc., with respect to such Subsidiary's real property in the city of Ramsey, Minnesota together with a "marked up" Ramsey Mortgage Title Insurance Commitment in the form attached hereto as Exhibit 6.1(a)(vi)(ii).

(b)     Corporate Proceedings.  Agent shall have received (i) a copy of the resolutions, in form and substance satisfactory to Agent, of the board of directors of Borrower authorizing (x) the execution, delivery and performance of the Second Amendment and Restatement Agreement, the Notes and the other Loan Documents to which it is a party and (y) the borrowings and other extensions of credit contemplated hereunder, certified by the Secretary or an Assistant Secretary of Borrower as of the Restatement Date, which certificate shall state that the resolutions thereby certified have not been amended, revoked, or rescinded and shall be in form and substance satisfactory to Agent, (ii) a copy of the resolutions, in form and substance satisfactory to Agent, of the board of directors of each Subsidiary Guarantor authorizing (x) the execution, delivery and performance of each Loan Document to which it is a party, certified by the Secretary or an Assistant Secretary of each such Subsidiary Guarantor as of the Restatement Date, which certificate shall state that the resolutions thereby certified have not been amended, revoked, or rescinded and shall be in form and substance satisfactory to Agent and (iii) copies of all documents and papers, including records of corporate proceedings, governmental approvals, good standing certificates, and bring down telegrams, if any, which Agent reasonably may have requested in connection therewith, such documents and papers where appropriate to be certified by proper corporate or governmental authorities.

(c)     Corporate Documents.  Agent shall have received, with a counterpart for each Lender, true and complete copies of the certificate of incorporation and by-laws of Borrower and each Subsidiary, certified as of the Restatement Date as complete and correct copies thereof by the Secretary or an Assistant Secretary of such Person or a certificate of the Secretary or an Assistance Secretary of such Person certifying that there has been no change to such Certificate of Incorporation and By-laws since the Restatement Date.

(d)     Incumbency Certificate.  Agent shall have received a certificate of the Secretary or an Assistant Secretary of each Credit Party, dated the Restatement Date, as to the incumbency and signature of the officers of such Person executing the Loan Documents to which it is a party and any certificate or other documents to be delivered by it pursuant thereto.

(e)     Fees and Amendment Fee.  Agent and the Documentation Agent shall have received, for their own accounts and/or the accounts of Lenders, (i) all accrued fees and expenses due and owing hereunder or in connection herewith to Lenders and Agents and (ii) an amendment fee in the amount of .125% of the sum of the Commitments and Converted Term Loan Amounts of each Lender (after giving effect to the Second Amendment and Restatement Agreement) that executes the Second Amendment and Restatement Agreement on or before 5:00 p.m. central time, October 12, 2001.

(f)     Legal Opinions.  Agent shall have received, with a counterpart for each Lender, the executed legal opinion of each of Faegre & Benson, counsel to the Credit Parties, substantially in the form of Exhibit 6.1(f)(i) and of the general counsel of Borrower substantially in the form of Exhibit 6.1(f)(ii).  Such legal opinions shall cover such other matters incident to the transactions contemplated by the Second Amendment and Restatement Agreement as Agent may reasonably require and such counsel delivering the foregoing legal opinion is expressly instructed to deliver its opinion for the benefit of each of Agent and the Lenders.

(g)     Approvals.  All necessary governmental (domestic and foreign) and third party approvals in connection with the Transaction and otherwise referred to herein or therein shall have been obtained and remain in effect, and all applicable waiting periods shall have expired without any action being taken by any competent authority which restrains, prevents or imposes materially adverse conditions upon the consummation of all or any part of the Transaction or the other transactions contemplated by the Loan Documents and otherwise referred to herein or therein.  Additionally, there shall not exist any judgment, order, injunction or other restraint issued or filed or a hearing seeking injunctive relief or other restraint pending or notified prohibiting or imposing materially adverse conditions upon all or any part of the Transaction, the transactions contemplated by the Documents or the making of the Loans or the issuance of the Letters of Credit.

(h)     Litigation.  No litigation by any entity (private or governmental) shall be pending or, to the best knowledge of Borrower, threatened with respect to the Second Amendment and Restatement Agreement, any of the Loan Documents or any documentation executed in connection herewith or the transactions contemplated hereby (including, without limitation, the Transaction), or the obligations being refinanced in connection with the consummation of the Transaction or which Agents or the Required Lenders shall determine could reasonably be expected to have a Material Adverse Effect.

(i)     Officer's Certificate.  Agents shall have received a certificate executed by a responsible officer on behalf of Borrower, dated the Restatement Date and in the form of Exhibit 6.1(i) hereto, stating that the representations and warranties set forth in Article V hereof are true and correct as of the date of the certificate, that no Event of Default or Unmatured Event of Default has occurred and is continuing and that the conditions of Section 6.1 hereof have been fully satisfied (except that no opinion need be expressed as to the Agent's or Required Lenders' satisfaction with any document, instrument or other matter).

(j)     Adverse Change.  On or prior to the Restatement Date, nothing shall have occurred (and none of the Agents nor any Lender shall have become aware of any facts or conditions not previously known) which Agents or the Required Lenders shall determine has or reasonably could be expected to have, or could have a Material Adverse Effect.

6.2    Conditions Precedent to Effectiveness.  The Third Amended and Restated Credit Agreement shall become effective upon the satisfaction of each of the following conditions:

(a)     Loan Documents.  Agent shall have received each of:

(i)     the Third Amended and Restated Credit Agreement, executed and delivered by a duly authorized officer of Borrower, the Agent and the Lenders;

(ii)     for the account of each Lender requesting the same, Notes conforming to the requirements hereof and executed by a duly authorized officer of Borrower;

(iii)    an Amended and Restated Security Agreement executed and delivered by a duly authorized officer of Borrower and each Subsidiary Guarantor substantially in the form of Exhibit 6.2(a)(iii) hereto (as amended, restated, supplemented or otherwise modified from time to time, in the case of the Borrower the "Borrower Security Agreement" and in the case of the Subsidiary Guarantors the "Subsidiary Guarantor Security Agreement" collectively with the Borrower Security Agreement, the "Security Agreements") and in each case along with Annex H and Annex I thereto executed and delivered by a duly authorized officer of each Person party thereto, together with:

(a)     proper amendments to the UCC-1 financing statements (Form UCC-3 or such other financial statements or similar notices as shall be required by local law) duly prepared for filing under the UCC or other appropriate filing offices of each jurisdiction as may be necessary or, in the opinion of Agent, desirable to perfect the security interests purported to be created by the Security Agreements;

 (b)    evidence of the completion of all other recordings and filings of, or with respect to, the Security Agreements and all other actions as may be necessary or, in the reasonable opinion of Agent, desirable to perfect the security interests intended to be created by the Security Agreements;

 (c)    evidence that all other actions necessary, or in the reasonable opinion of Agent, desirable to perfect the security interests purported to be granted by the Security Agreement have been taken;

(iv)    any additional Pledged Securities required to be delivered pursuant to the Pledge Agreement, if any, by any Credit Party, (x) endorsed in blank in the case of promissory notes constituting Pledged Securities and (y) together with executed and undated stock powers, in the case of capital stock constituting Pledged Securities, or other transfer assignment instruments in form and substance satisfactory to Agent, in the case of membership interests constituting Pledged Securities and (z) the Pledge Agreement and such other documents shall be in full force and effect, and each Credit Party which is a limited liability company shall have certificated all existing membership interests and delivered to Agent, as pledgee, such pledged certificates as Pledged Securities;

(v)     the Reaffirmation of Guaranty executed and delivered by a duly authorized officer of each Subsidiary Guarantor substantially in the form of Exhibit 6.2(a)(v) (as amended, restated, supplemented or otherwise modified from time to time, the "Reaffirmation of  Guaranty"); and

(vi)    the Cortland Mortgage in the form of Exhibit 6.2(a)(vi)(i), executed by Borrower together with a "marked up" Cortland Mortgage Title Insurance Commitment in the form attached hereto as Exhibit 6.2(a)(vi)(ii).

(b)     Corporate Proceedings.  Agent shall have received (i) a copy of the resolutions, in form and substance satisfactory to Agent, of the board of directors of Borrower authorizing (x) the execution, delivery and performance of the Third Amended and Restated Credit Agreement, the Notes and the other Loan Documents to which it is a party and (y) the borrowings and other extensions of credit contemplated hereunder, certified by the Secretary or an Assistant Secretary of Borrower as of the Third Amended and Restated Effective Date, which certificate shall state that the resolutions thereby certified have not been amended, revoked, or rescinded and shall be in form and substance satisfactory to Agent, (ii) a copy of the resolutions, in form and substance satisfactory to Agent, of the board of directors of each Subsidiary Guarantor authorizing (x) the execution, delivery and performance of each Loan Document to which it is a party, certified by the Secretary or an Assistant Secretary of each such Subsidiary Guarantor as of the Third Amended and Restated Effective Date, which certificate shall state that the resolutions thereby certified have not been amended, revoked, or rescinded and shall be in form and substance satisfactory to Agent and (iii) copies of all documents and papers, including records of corporate proceedings, governmental approvals, good standing certificates, and bring down telegrams, if any, which Agent reasonably may have requested in connection therewith, such documents and papers where appropriate to be certified by proper corporate or governmental authorities.

(c)     Corporate Documents.  Agent shall have received, with a counterpart for each Lender, true and complete copies of the certificate of incorporation and by-laws of Borrower and each Subsidiary Guarantor, certified as of the Third Amended and Restated Effective Date as complete and correct copies thereof by the Secretary or an Assistant Secretary of such Person or a certificate of the Secretary or an Assistance Secretary of such Person certifying that there has been no change to such Certificate of Incorporation and By-laws since the Third Amended and Restated Effective Date.

(d)     Incumbency Certificate.  Agent shall have received a certificate of the Secretary or an Assistant Secretary of each Credit Party, dated the Third Amended and Restated Effective Date, as to the incumbency and signature of the officers of such Person executing the Loan Documents to which it is a party and any certificate or other documents to be delivered by it pursuant thereto.

(e)     Fees and Amendment Fee.  Agent and the Documentation Agent shall have received, for their own accounts and/or the accounts of Lenders, (i) all accrued fees and expenses due and owing hereunder or in connection herewith to Lenders and Agents and (ii) an amendment fee in the amount of .500% of the sum of the Commitments and Term Loans of each Lender (after giving effect to the Third Amended and Restated Credit Agreement) that executes the Third Amended and Restated Credit Agreement on or before 5:00 p.m. central time, September 27, 2002.

(f)     Legal Opinions.  Agent shall have received, with a counterpart for each Lender, the executed legal opinions of (i) the general counsel of Borrower, substantially in the form of Exhibit 6.2(f)(i); (ii) Faegre & Benson LLP, counsel to the Credit Parties, substantially in the form of Exhibit 6.2(f)(ii); and (iii) Bond, Schoenock & King LLP, counsel to the Credit Parties substantially in the form of Exhibit 6.2(f)(iii)  Such legal opinions shall cover such other matters incident to the transactions contemplated by the Third Amended and Restated Credit Agreement as Agent may reasonably require and such counsel delivering the foregoing legal opinion is expressly instructed to deliver its opinion for the benefit of each of Agent and the Lenders.

(g)     Approvals.  All necessary governmental (domestic and foreign) and third party approvals in connection with the Third Amended and Restated Credit Agreement and otherwise referred to herein or therein shall have been obtained and remain in effect, and all applicable waiting periods shall have expired without any action being taken by any competent authority which restrains, prevents or imposes materially adverse conditions upon the consummation of all or any part of the Third Amended and Restated Credit Agreement or the other transactions contemplated by the Loan Documents and otherwise referred to herein or therein.  Additionally, there shall not exist any judgment, order, injunction or other restraint issued or filed or a hearing seeking injunctive relief or other restraint pending or notified prohibiting or imposing materially adverse conditions upon all or any part of the Third Amended and Restated Credit Agreement, the transactions contemplated by the Documents or the making of the Loans or the issuance of the Letters of Credit.

(h)     Litigation.  No litigation by any entity (private or governmental) shall be pending or, to the best knowledge of Borrower, threatened with respect to the Third Amended and Restated Credit Agreement, any of the Loan Documents or any documentation executed in connection herewith or the transactions contemplated hereby (including, without limitation, the Third Amended and Restated Credit Agreement), or the obligations being refinanced in connection with the consummation of the Third Amended and Restated Credit Agreement or which Agents or the Required Lenders shall determine could reasonably be expected to have a Material Adverse Effect.

(i)     Officer's Certificate.  Agents shall have received a certificate executed by a responsible officer on behalf of Borrower, dated the Third Amended and Restated Effective Date and in the form of Exhibit 6.2(i) hereto, stating that the representations and warranties set forth in Article V hereof are true and correct as of the date of the certificate, that no Event of Default or Unmatured Event of Default has occurred and is continuing and that the conditions of Section 6.2 hereof have been fully satisfied (except that no opinion need be expressed as to the Agent's or Required Lenders' satisfaction with any document, instrument or other matter).

(j)     Adverse Change.  On or prior to the Third Amended and Restated Effective Date, nothing shall have occurred (and none of the Agents nor any Lender shall have become aware of any facts or conditions not previously known) which Agents or the Required Lenders shall determine has or reasonably could be expected to have, or could have a Material Adverse Effect.

 (k)    Cortland Appraisal.  On or prior to the Third Amended and Restated Effective Date, the Agents and the Lenders shall have received an appraisal of the Cortland, New York property owned by the Borrower in form and substance satisfactory to the Agent and the Required Lenders.

(l)     Ramsey Mortgage Amendment.  Agent shall have received an amendment to the Ramsey Mortgage executed and delivered by a duly authorized officer of Borrower in form and substance satisfactory to the Agent.

(m)    Borrowing Base Certificate.  Agent shall have received a Borrowing Base Certificate executed by the Treasurer or Chief Financial Officer of Borrower, dated the Third Amended and Restated Effective Date in the form of Exhibit 7.2(h) hereto.

6.3    Certain Conditions Precedent to Each Loan or Letter of Credit.  The agreement of each Lender to make a Loan (including, without limitation, its initial Loans hereunder, but other than any Revolving Loan the proceeds of which are to be used exclusively to repay Refunded Swing Line Loans) and the obligation of any Facing Agent to issue or any Lender to participate in any Letter of Credit is subject to the satisfaction of the following conditions precedent:

(a)     Representations and Warranties.  All representations and warranties of Borrower and each other Credit Party contained herein and in the other Loan Documents shall be true and correct in all material respects with the same effect as though such representations and warranties had been made on and as of the date of the making of such Loan or Letter of Credit;

(b)     No Events of Default.  There shall exist no Event of Default or Unmatured Event of Default;

(c)     Available Revolving Commitment.  After giving effect to the Loans and Letters of Credit requested to be made, no Lender will have an Available Revolving Commitment which is less than zero; and

(d)     Other Matters.  Agent shall have received such other documents as required by this Agreement in connection with such Loan, all in form and substance as required by this Agreement including, with respect to Revolving Loans, a request for a Borrowing in accordance with the provisions of Section 2.5 hereof; and with respect to the issuance of a Letter of Credit, Agent and the respective facing Agent shall have received a Letter of Credit Request meeting the requirements of Section 2.9(b).

Each request for a Borrowing and the acceptance by Borrower of the proceeds thereof shall constitute a representation and warranty by Borrower, as of the date of the Loans comprising such Borrowing, that the conditions specified in Section 6.3(a), (b) and (c) have been satisfied.

ARTICLE VII
AFFIRMATIVE COVENANTS

Borrower hereby agrees that, so long as any Commitment remains in effect, or any Loan or LC Obligation remains outstanding and unpaid or any other amount is owing to any Lender or any Agent hereunder, Borrower shall:

7.1    Financial Statements.  Furnish to each Lender:

(a)     as soon as available, but in any event within 90 days after the end of each fiscal year of Borrower, a copy of the consolidated and consolidating (by business unit) balance sheet of Borrower and its consolidated Subsidiaries as at the end of such year and the related consolidated and consolidating (by business unit) statements of income, retained earnings and of cash flows for such year, setting forth in each case in comparative form the figures for the previous year; and

(b)     as soon as available, but in any event not later than 45 days after the end of each of the quarterly periods of each fiscal year of Borrower, the unaudited consolidated and consolidating (by business unit) balance sheet of Borrower and its consolidated Subsidiaries as at the end of such quarter and the related unaudited consolidated and consolidating (by business unit) statements of income, retained earnings and of cash flows of Borrower and its consolidated Subsidiaries for such quarter and the portion of the fiscal year through the end of such quarter, setting forth in each case in comparative form the figures for the previous year (except with respect to balance sheet figures which shall be in comparative form for the previous audited period only);

(c)     as soon as available, but in any event within 30 days after the end of each fiscal month of Borrower other than the last such month of any fiscal quarter of Borrower, the consolidated and business segment statements of operations for such month in form reasonably satisfactory to Agent;

all such financial statements shall be complete and correct in all material respects and shall be prepared in accordance with GAAP applied consistently throughout the periods reflected therein and with prior periods (except as approved by the accountants preparing such statements or Financial Officer, as the case may be, and disclosed therein) and, in the case of the consolidated financial statements referred to in Section 7.1(a), accompanied by a report thereon of independent certified public accountants of recognized national standing, which report shall contain no qualifications with respect to the continuance of Borrower and its Subsidiaries as going concerns and shall include a statement to the effect that such financial statements present fairly in all material respects the consolidated financial position of Borrower and its Subsidiaries as at the dates indicated and the consolidated results of their operations and cash flow for the periods indicated in conformity with GAAP and that the examination by such accountants in connection with such financial statements has been made in accordance with generally accepted auditing standards.

7.2    Certificates; Other Information.  Furnish to each Lender (or, if specified below, to Agent):

(a)     Accountant's Certificates.  Concurrently with the delivery of the financial statements referred to in Section 7.1(a), (i) to the extent not contrary to the then current recommendations of the American Institute of Certified Public Accountants, a certificate from Ernst & Young L.L.P. or other independent certified public accountants of nationally recognized standing, stating that, in the course of their annual audit of the books and records of Borrower, no Event of Default or Unmatured Event of Default has come to their attention which was continuing at the end of such fiscal year or on the date of their certificate, or if such an Event of Default or Unmatured Event of Default has come to their attention, the certificate shall indicate the nature of such Event of Default or Unmatured Event of Default and the action which Borrower proposes to take with respect thereto, and (ii) a letter, in form reasonably satisfactory to Agent from such accountants with respect to reliance on such accountant's certificate and report on the annual consolidated financial statements referred to in this Section;

(b)     Officer's Certificate.  Concurrently with the delivery of the financial statements referred to in Sections 7.1(a), 7.1(b) and 7.1(c), a certificate of a Financial Officer substantially in the form of Exhibit 7.2(b) stating that, to the best of such Financial Officer's knowledge, (i) such financial statements present fairly, in accordance with GAAP, the financial condition and results of operations of Borrower and its Subsidiaries for the period referred to therein (subject, in the case of interim statements, to normal recurring adjustments) and  (ii) that no Event of Default or Unmatured Event of Default has occurred, in each case except as specified in such certificates, which shall set forth detailed computations to the extent necessary to establish whether Borrower is in compliance with the covenants set forth in Section 8.1 of this Agreement;

(c)     Budgets; Projections.  As soon as available and in any event within sixty (60) days following the first day of each fiscal year of Borrower (i) an annual budget in form substantially similar to the Projections (including budgeted statements of operations, income, cash flows, retained earnings and shareholders' equity and balance sheets) prepared by Borrower for each fiscal quarter of such fiscal year and (ii) projections in form substantially similar to the Projections covering the period from such fiscal year through the Termination Date, in each case prepared in reasonable detail, with appropriate presentation and discussion of the principal assumptions upon which such budgets and projections are based, which shall be accompanied by the statement of the chief executive officer or Chief Financial Officer of Borrower to the effect that, to the best of his knowledge, such budget and projections are a reasonable estimate for the periods respectively covered thereby;

(d)     Audit Reports and Statements.  Promptly following Borrower's receipt thereof, copies of all consolidated financial or other consolidated reports or statements, if any, submitted to Borrower or any of its Subsidiaries by independent public accountants relating to any annual or interim audit of the books of Borrower or any of its Subsidiaries;

(e)     Public Filings.  Within 20 days after the same become public, copies of all financial statements, filings, registrations and reports which Borrower may make to, or file with, the United States Securities and Exchange Commission or any successor or analogous U.S. Governmental Authority;

(f)     Status.  Within five Business Days after the occurrence thereof, written notice to Agent of any change in the Most Recent Ratio of Consolidated Debt to Consolidated EBITDA which results in a change in the Applicable Margin or the Applicable Commitment Fee, provided, however, that the failure to provide such notice shall not delay or otherwise affect any change in the Applicable Margin or other amount payable hereunder which is to occur upon such a change pursuant to the terms of this Agreement; and

(g)    Other Requested Information  Such other information respecting the respective properties, business affairs, financial condition and/or operations of Borrower or any of its Subsidiaries as Agent or any Lender may from time to time reasonably request.

(h)     Borrowing Base Certificate.  As soon as available, but not later than 30 days after the end of each month, a borrowing base certificate in the form of Exhibit 7.2(h) (each, a "Borrowing Base Certificate") executed by the Treasurer or Chief Financial Officer of the Borrower, with respect to the Eligible Receivables and Eligible Inventory of the Borrower and its Subsidiaries as of the last day of the immediately preceding month.

7.3    Notices.  Promptly upon obtaining knowledge thereof, give notice to Agent (which shall promptly provide a copy of such notice to each Lender) of:

(a)     Event of Default or Unmatured Event of Default.  The occurrence of any Event of Default or Unmatured Event of Default, accompanied by a statement of a Financial Officer setting forth details of the occurrence referred to therein and stating what action Borrower proposes to take with respect thereto.

(b)     Litigation and Related Matters.  The commencement of, or any material development in any action, suit, proceeding or investigation pending or threatened against or affecting Borrower or any of its Subsidiaries or any of their respective properties before any arbitrator or Governmental Authority, in which the amount involved that Borrower reasonably determines is not covered by insurance is $7,500,000 or more, or which, if determined adversely to Borrower or any of its Subsidiaries, would reasonably be expected to have a Material Adverse Effect.

(c)     Notice of Change of Control.  Each occasion that there shall occur a Change of Control, and such notice shall set forth in reasonable detail the particulars of each such occasion.

7.4    Conduct of Business and Maintenance of Existence.  Continue to engage in business of the same general type as now conducted by it and preserve, renew and keep in full force and effect its and each Subsidiary's corporate existence (except for any Subsidiary merged or otherwise consolidated with or into Borrower or another Subsidiary) and take all reasonable action to maintain all rights, privileges and franchises material to its and those of each of its Subsidiaries' businesses except as otherwise permitted pursuant to Sections 8.4 and 8.7 and comply and cause each of its Subsidiaries to comply with all Contractual Obligations and Requirements of Law except to the extent that failure to comply therewith would not in the aggregate reasonably be expected to have a Material Adverse Effect.

7.5    Payment of Obligations.  Pay or discharge or otherwise satisfy at maturity or, to the extent permitted hereby, prior to maturity or before they become delinquent, as the case may be, and cause each of its Subsidiaries to pay or discharge or otherwise satisfy at or before maturity or before they become delinquent, as the case may be:

(i)     all its and their respective Indebtedness;

(ii)     all taxes, assessments and governmental charges or levies imposed upon any of them or upon any of their income or profits or any of their respective properties or assets prior to the date on which penalties attach thereto; and

(iii)    all lawful claims prior to the time they become a Lien (other than Permitted Liens) upon any of their respective properties or assets;

provided, however, that neither Borrower nor any of its Subsidiaries shall be required to pay or discharge any such Indebtedness, tax, assessment, charge, levy or claim while the same is being contested by it in good faith and by appropriate proceedings diligently pursued so long as Borrower or such Subsidiary, as the case may be, shall have set aside on its books adequate reserves in accordance with GAAP (segregated to the extent required by GAAP) with respect thereto and title to any material properties or assets is not jeopardized in any material respect.

7.6    Inspection of Property, Books and Records.  Keep, or cause to be kept, and cause each of its Subsidiaries to keep or cause to be kept, adequate records and books of account, in which complete entries are to be made reflecting its and their business and financial transactions, such entries to be made in accordance with sound accounting principles consistently applied and will permit, and cause each of its Subsidiaries to permit, any Lender or its respective representatives, at any reasonable time, and from time to time at the reasonable request of such Lender made to Borrower and upon reasonable notice, to visit and inspect its and their respective properties, to examine and make copies of and take abstracts from its and their records and books of account, and to discuss its and their respective affairs, finances and accounts with its and their principal officers, directors and independent public accountants (and by this provision Borrower authorizes such accountants to discuss with the Lenders and such representatives the affairs, finances and accounts of Borrower and its Subsidiaries; provided, however, that prior to the occurrence and continuance of an Event of Default, all such discussions shall take place in the presence of a Financial Officer of Borrower).

7.7    ERISA.  (i)  As soon as practicable and in any event within thirty days after Borrower or any of its Subsidiaries or ERISA Affiliates knows or has reason to know that a Reportable Event has occurred with respect to any Plan which would have a Material Adverse Effect, deliver, or cause such Subsidiary or ERISA Affiliate to deliver, to Agent a certificate of a responsible officer of Borrower or such Subsidiary or ERISA Affiliate, as the case may be, setting forth the details of such Reportable Event and the action, if any, which Borrower or such Subsidiary or ERISA Affiliate is required or proposes to take, together with any notices required or proposed to be given; (ii) upon the request of any Lender made from time to time, deliver, or cause each Subsidiary or ERISA Affiliate to deliver, to each Lender a copy of the most recent actuarial report completed and annual report filed with respect to any Plan; (iii) as soon as possible and in any event within ten (10) days after Borrower or any of its Subsidiaries or ERISA Affiliates knows or has reason to know that any of the following have occurred or is reasonably likely to occur with respect to any Plan and could reasonably be expected to have a Material Adverse Effect: (A) the Plan Sponsor intends to terminate such Plan, (B) the PBGC has instituted or will institute proceedings under Section 4042 of ERISA to terminate such Plan, (C) that an accumulated funding deficiency (as defined in Section 3.02(a) of ERISA and Section 412(a) of the Code) has been incurred or that on application may be or has been made to the Secretary of the Treasury for a waiver or modification of the minimum funding standard (including any required installment payments) or on extension of any amortization period under Section 412 of the Code, or (D) that Borrower, or any Subsidiary of Borrower or any ERISA Affiliate will or is reasonably likely to incur any liability (including, but not limited to, contingent or secondary liability) to or on account of the termination of or withdrawal from a Plan under Section 401(a)(29), 4971, 4975 or 4980 of the Code or Section 409 or 502(1) of ERISA, deliver, or cause such Subsidiary or ERISA Affiliate to deliver, to Agent a written notice thereof; and (iv) as soon as possible and in any event within thirty days after Borrower or any of its Subsidiaries or ERISA Affiliates knows or has reason to know that any of them has caused a complete withdrawal or partial withdrawal (within the meaning of Sections 4203 and 4205, respectively, of ERISA) from any Multiemployer Plan and that such withdrawal could reasonably be expected to have a Material Adverse Effect, deliver, or cause such Subsidiary or ERISA Affiliate to deliver, to Agent a written notice thereof.  For purposes of this Section 7.7, Borrower shall be deemed to have knowledge of all facts known by the Plan Administrator of any Plan of which Borrower is the Plan Sponsor, and each Subsidiary and ERISA Affiliate of Borrower shall be deemed to have knowledge of all facts known by the Plan Administrator of any Plan of which such Subsidiary or ERISA Affiliate, respectively, is a Plan Sponsor.  In addition to its other obligations set forth in this Section 7.7, Borrower shall, and shall cause each of its Subsidiaries and ERISA Affiliates to,

(A)    furnish to Agent, promptly after delivery of the same to the PBGC by Borrower or any of its Subsidiaries, a copy of any delinquency notice pursuant to Section 412(n) (4) of the Code,

(B)    correct any such failure to satisfy funding requirements or delinquency referred to in the foregoing clauses (iii)(C) of the first sentence of this Section 7.7 and clause (A) above within ninety (90) days after the occurrence thereof, except where the failure to so satisfy would not reasonably be expected to have a Material Adverse Effect, and

(C)    comply in good faith with the requirements set forth in Section 4980B of the Code and with Sections 601(a) and 606 of ERISA, except where the failure to so comply could not reasonably be expected to have a Material Adverse Effect.

7.8    Insurance.  Borrower shall maintain, and shall cause each of its Subsidiaries to maintain, with financially sound and reputable insurers, insurance with respect to its properties and business against loss or damage of the kinds customarily insured against by Persons engaged in the same or similar business, or such types and in such amounts as are customarily carried under similar circumstances by such other Persons.  Such insurance shall be maintained with financially sound and reputable insurers, except that a portion of such insurance program (not to exceed that which is customary in the case of companies engaged in the same or similar business or having similar properties similarly situated) may be effected through self-insurance, provided adequate reserves therefor, in accordance with GAAP, are maintained.

7.9    Environmental Laws.

(a)     Comply with in all material respects, and cause its Subsidiaries to comply with in all material respects, and, in each case take reasonable steps to ensure compliance in all material respects by all tenants and subtenants, if any, with, all applicable Environmental Laws and obtain and comply in all material respects with and maintain, and take reasonable steps to ensure that all tenants and subtenants obtain and comply in all material respects with and maintain, any and all licenses, approvals, notifications, registrations or permits required by applicable Environmental Laws except to the extent that failure to do so would not reasonably be expected to have a Material Adverse Effect;

(b)     Conduct and complete all investigations, studies, sampling and testing, and all remedial, removal and other actions required under Environmental Laws and promptly comply in all material respects with all lawful orders, directives and information requests of all Governmental Authorities regarding Environmental Laws except to the extent that the same are being contested in good faith by appropriate proceedings and the pendency of such proceedings would not  reasonably be expected to have a Material Adverse Effect; and

(c)     Defend, indemnify and hold harmless Agent and the Lenders, and their respective employees, agents, officers and directors, from and against any and all claims, demands, penalties, fines, liabilities, settlements, damages, costs and expenses of whatever kind or nature known or unknown, contingent or otherwise, arising out of, or in any way relating to the violation of, noncompliance with or liability under, any Environmental Law applicable to the operations of Borrower, any of its Subsidiaries or their respective properties, or any orders, requirements or demands of Governmental Authorities related thereto, including, without limitation, reasonable attorneys' and consultants' fees, investigation and laboratory fees, costs arising from any Remedial Actions, court costs and litigation expenses, except to the extent that any of the foregoing arise out of the gross negligence or willful misconduct of the party seeking indemnification therefor.  The agreements in this clause (c) shall survive repayment of the Notes and all other Obligations.

7.10   Intentionally Omitted.  

7.11   Intentionally Omitted.

7.12   Additional Security; Further Assurances.  

(a)     Additional Subsidiary Guarantors.  Borrower agrees to cause each new Domestic Subsidiary established or created in accordance with Sections 8.4 and 8.8 (a "New Domestic Subsidiary") to execute and deliver the Subsidiary Guaranty or such other guaranty of all Obligations and all obligations under Interest Rate Protection Agreements entered into with a Lender or any Affiliate thereof in form and substance reasonably satisfactory to Agent.

(b)     Pledge of New Subsidiary Stock.  Borrower agrees to pledge, or to cause its Subsidiaries to pledge, (i) all of the Capital Stock of each New Domestic Subsidiary and (ii) 65% of all Capital Stock of each new Foreign Subsidiary owned directly by Borrower or any Domestic Subsidiary established or created to Collateral Agent for the benefit of the Secured Creditors pursuant to the Pledge Agreement.

(c)     Grant of Security by New Domestic Subsidiaries.  Borrower will cause each New Domestic Subsidiary which is required to execute and deliver the Subsidiary Guarantee Agreement pursuant to Section 7.12(a) to grant to Collateral Agent a first priority Lien (subject to Permitted Liens) on all property (tangible and intangible) of such Subsidiary that would have constituted Collateral on the Third Amended and Restated Effective Date upon terms substantially similar to those set forth in the Security Documents as appropriate, and reasonably satisfactory in form and substance to Agent.  Borrower shall cause each Subsidiary, at its own expense, to execute, acknowledge and deliver, or cause the execution, acknowledgment and delivery of, any document or instrument necessary or desirable for the creation and perfection of the foregoing Liens.  Borrower will cause each of its newly established Subsidiaries to take all actions requested by Agent (including, without limitation, the filing of UCC-1's) in connection with the granting and perfecting of such security interests.

(d)     Documentation for Additional Security.  The security interests required to be granted pursuant to this Section 7.12 shall be granted pursuant to such security documentation (which shall  be substantially similar to the Security Documents already executed and delivered by the Credit Parties on the Third Amended and Restated Effective Date) reasonably satisfactory in form and substance to Agent and shall constitute valid and enforceable perfected security interests prior to the rights of all third Persons (subject to Permitted Liens) and subject to no other Liens except Permitted Liens or, in the case of Mortgages, Permitted Real Property Encumbrances.  The Additional Security Documents and other instruments related thereto shall be duly recorded or filed in such manner and in such places and at such times as are required by law to establish, perfect, preserve and protect the Liens, in favor of Collateral Agent for the benefit of the Secured Creditors, required to be granted pursuant to the Additional Security Document and, all taxes, fees and other charges payable in connection therewith shall be paid in full by Borrower.  At the time of the execution and delivery of the Additional Security Documents, Borrower shall cause to be delivered to the Collateral Agent such agreements, certificates, opinions of counsel, Mortgage Policies, title surveys, real estate appraisals  and other related documents as may be reasonably requested by Agent to assure Agent that this Section 7.12 has been complied with.

(e)     Foreign Subsidiaries Security.  If following a change in applicable law, including the relevant sections of the Code or the regulations promulgated thereunder, counsel for Borrower reasonably acceptable to Agent does not within 45 days after a request from Agent or the Lenders deliver evidence, in form and substance reasonably satisfactory to Agent, with respect to any Foreign Subsidiary which has not already had all of its stock pledged pursuant to the Pledge Agreement that a pledge of 66-2/3% or more of the total combined voting power of all classes of capital stock of such Foreign Subsidiary entitled to vote would cause the undistributed earnings of such Foreign Subsidiary as determined for Federal income tax purposes to be treated as a deemed dividend to such Foreign Subsidiary's United States parent for Federal income tax purposes, then that portion of such Foreign Subsidiary's outstanding capital stock not theretofore pledged pursuant to the Pledge Agreement shall be pledge to the Collateral Agent for the benefit of the Secured Creditors pursuant to the Pledge Agreement (or another pledge agreement in substantially similar form, if needed), to the extent that entering into such Pledge Agreement is permitted by the laws of the respective foreign jurisdiction and with all documents delivered pursuant to this Section 7.12 to be in form and substance reasonably satisfactory to Agent.

(f)     Agreement to Grant Additional Security.  Promptly, and in any event within 30 days after the acquisition by Borrower or any Subsidiary of assets or real or personal property or leasehold interests of the type that would have constituted Collateral on the Third Amended and Restated Effective Date and investments of the type that would have constituted Collateral on the Third Amended and Restated Effective Date (the "Additional Collateral"), Borrower will notify the Agent of such new Collateral and will execute all filing of appropriate financing statements under the provisions of the UCC, applicable foreign, domestic or local laws, rules or regulations in each of the offices where such filing is, except with respect to Foreign Subsidiaries as otherwise set forth herein, necessary or appropriate and (ii) will with respect to real estate, execute a mortgage, obtain Mortgage Policies, title surveys, Landlord Consents and real estate appraisals satisfying all Requirements of Law, to grant Collateral Agent a perfected Lien in such Collateral (or comparable interest under foreign law in the case of foreign Collateral) pursuant to and to the full extent required by the Security Documents and this Agreement; provided, however, that Borrower shall not be required to notify the Agent for any Additional Collateral in the event Lenders' security interest therein has already been perfected.

7.13  Pledge of BV1.   Borrower shall, as soon as practicable, but in any event not later than January 31, 2000 (subject to extension in the reasonable discretion of the Agent), pledge 65% of the issued and outstanding Capital Stock of Buckbee-Mears Holding Company B.V., to the Collateral Agent for the benefit of the Secured Creditors pursuant to documentation reasonably satisfactory to the Agent, including, without limitation, an opinion of counsel (if requested by Agent).

7.14  Third Party Consultant.     Upon the occurrence of any Event of Default, or in the event that as of the last day of any fiscal quarter, the Consolidated EBITDA of the Borrower and its Subsidiaries is less than $26 million for the period of four consecutive fiscal quarters ending on such last day as determined in conjunction with the calculation of the Leverage Ratio pursuant to Section 8.1(b), the Agent shall be entitled to retain an independent third party consultant to assist it in evaluating the reasonableness of Borrower's financial forecast, the fees and expenses of such third party consultant to be paid by Borrower.  

7.15   Field Audit.  Within sixty (60) days following the Third Amended and Restated Effective Date, the Borrower shall deliver to Agent and the Lenders a report of the field examination of the Accounts Receivable and Inventory of Borrower and its Subsidiaries (the "Field Audit") which shall be in a form reasonably satisfactory to Agent.

7.16   Operating Accounts and Deposit Accounts.  Borrower shall, at all times, and shall cause each Credit Party to, at all times, maintain all of its Operating Accounts and Deposit Accounts with a Lender or Lenders; provided, however, that nothing in this Section 7.16 shall be construed to require Borrower or any Credit Party to maintain its Deposit Accounts and Operating Accounts with any Lender on terms that are not commercially reasonable nor shall anything in this Section 7.16 be construed to require any Lender to offer any such services to Borrower or any Credit Party; provided, further, in the event Borrower or any Credit Party is unable to obtain Deposit Accounts and Operating Accounts with any of the Lenders on a commercially reasonable basis, Borrower and the Credit Parties may maintain such Deposit Accounts and Operating Accounts with a financial institution(s) that is not a Lender provided that such financial institution(s) provide the Agent a written acknowledgement in form and substance reasonably satisfactory to Agent acknowledging the Lenders' Lien in the Collateral held in such Deposit Accounts and Operating Accounts and agreeing, upon the occurrence and continuance of an Event of Default, to take any such action with respect to the Collateral as directed by the Agent consistent with the terms of this Agreement and the Loan Documents.

7.17   Field Exam Upon Event of Default.  Upon the occurrence of any Event of Default, at the request of the Agent and the Supermajority Lenders of the Revolving Loan Facility, the Term A Facility and the Term B Facility, the Borrower shall retain a third party consultant to undertake a field examination of the Accounts Receivable and Inventory of Borrower and its Subsidiaries a report of which field examination shall be delivered to the Lenders and Agent within forty-five (45) days following any such request.   

ARTICLE VIII
NEGATIVE COVENANTS

Borrower hereby agrees that, so long as the Revolving Commitments remain in effect or any Obligation is owing to any Lender or any Agent hereunder, Borrower shall not, nor shall it permit any of its Subsidiaries to, directly or indirectly:

8.1    Financial Condition Covenants.

(a)     Maintenance of Consolidated Net Worth.  Permit Consolidated Net Worth on the last day of any fiscal quarter to be less than the sum of (i)  $150,000,000 plus (ii) the amount equal to 50% of the aggregate Consolidated Net Income of Borrower and its consolidated Subsidiaries since December 31, 1997; provided, however, that in the event that Borrower and its consolidated Subsidiaries have a consolidated net loss for any fiscal quarter, Consolidated Net Income for purposes only of clause (ii) of this Section 8.1(a) shall be deemed to be zero for such fiscal quarter plus (iii) 75% of the Net Offering Proceeds from the issuance of Capital Stock.

(b)     Leverage Ratio.  Permit the ratio of (a) Consolidated Debt on the last day of any fiscal quarter of Borrower (after giving effect to all payments and prepayments made on or prior to such last day) to (b) Consolidated EBITDA for the period of four consecutive fiscal quarters ending on such last day to be greater than the respective ratio set forth below opposite such fiscal quarter:

Fiscal Quarter Ending	Ratio
September 30, 2002	4.40:1.0
December 31, 2002	4.25:1.0
March 31, 2003	4.25:1.0
June 30, 2003	3.50:1.0
September 30, 2003	3.25:1.0
December 31, 2003	3.00:1.0
March  31, 2004	3.00:1.0

(c)     Interest Coverage Ratio.  Permit the ratio of (a) Consolidated EBITDA for the period of four consecutive fiscal quarters ending on the last day of any fiscal quarter of Borrower to (b) Consolidated Interest Expense for such period to be less than the respective ratio set forth below opposite such fiscal quarter:

Fiscal Quarter Ending	Ratio
September 30, 2002 through March 31, 2003	2.00:1.0
June 30, 2003	2.25:1.0
September 30, 2003 through December 31, 2003	2.50:1.0
March 31, 2004	2.75:1.0

(d)     Capital Expenditures. (i) Borrower will not, and will not permit any of its Subsidiaries to, make any Capital Expenditures, except that during any fiscal year Borrower and its Subsidiaries may make Capital Expenditures so long as the aggregate amount so made by Borrower and its Subsidiaries (on a consolidated basis) during such fiscal year does not exceed $15,000,000.

 (ii)    Notwithstanding the foregoing, Borrower and its Subsidiaries may make Capital Expenditures (which Capital Expenditures will not be included in any determination under the foregoing clause (i)) with the insurance proceeds received by Borrower or any of its Subsidiaries from any Recovery Event so long as such Capital Expenditures are to replace or restore any properties or assets in respect to which such proceeds are received.

8.2    Indebtedness.  Incur, directly or indirectly, or suffer to exist any Indebtedness except:

(a)     Indebtedness incurred pursuant to this Agreement and the other Loan Documents;

(b)     Intercompany Indebtedness to the extent such Indebtedness constitutes a Permitted Investment; provided, however, that in the event of any subsequent issuance or transfer of any Capital Stock which results in the holder of such Indebtedness ceasing to be a Credit Party of Borrower or any subsequent transfer of such Indebtedness (other than to Borrower or any other Credit Party) such Indebtedness shall be required to be permitted under another clause of this Section 8.2; provided, further, however, that in the case of Intercompany Indebtedness consisting of a loan or advance to Borrower, each such loan or advance shall be subordinated to the indefeasible payment in full of all of Borrower's obligations pursuant to this Agreement and the other Loan Documents, and each such loan or advance shall be on open account and shall not be evidenced by a promissory note or other instrument;

(c)     Indebtedness outstanding on the Closing Date and listed on Schedule 8.2(c) hereto, provided that the Indebtedness under Existing Credit Agreements have been paid in full with the proceeds of the Initial Loans under the Original Agreement;

(d)     Indebtedness under Interest Rate Protection Agreements entered into to protect Borrower or any of its Subsidiaries against fluctuations in interest rates in respect of the Obligations;

(e)     Indebtedness under Currency Protection Agreements so long as management of Borrower or such Subsidiary, as the case may be, has determined that entering into of such Currency Protection Agreements are bona fide hedging activities;

(f)     Permitted Subordinated Indebtedness;

(g)     Permitted IDB/Community Development Indebtedness; and

(h)     other Indebtedness in addition to that described in clauses (a) through (g) of this Section 8.2; provided, however, that the aggregate principal amount of the Indebtedness permitted under this Section 8.2(i), when added to all Permitted IDB/Community Development Indebtedness then outstanding does not exceed $5,000,000.

8.3    Liens. Create, incur, assume or suffer to exist or agree to create, incur or assume any Lien (except for Permitted Liens) in, upon or with respect to any of its properties or assets (including, without limitation, any securities or debt instruments of any of its Subsidiaries), whether now owned or hereafter acquired, or assign or otherwise convey any right to receive income to secure any obligation.

8.4    Fundamental Changes.  Enter into any merger, consolidation or amalgamation, or liquidate, wind-up or dissolve itself (or suffer any liquidation or dissolution); make any Material Asset Disposition; make any Acquisition; or make any material change in its present method of conducting business; provided, however, that as long as immediately after giving effect to such transaction, the resulting, surviving or transferee Person shall have Consolidated Net Worth in an amount which is not less than the Consolidated Net Worth of such Person prior to such transaction:

(a)     any Subsidiary of Borrower may be merged or consolidated with or into Borrower (provided, however, that Borrower shall be the continuing or surviving corporation) or with or into any one or more Wholly-Owned Subsidiaries of Borrower (provided, however, that (i) at least one Wholly-Owned Subsidiary shall be the continuing or surviving corporation and (ii) in the case of any merger or consolidation between Subsidiaries at least one of that is a Subsidiary Guarantor, a Subsidiary Guarantor shall be the surviving Person);

(b)     any Wholly-Owned Subsidiary may sell, lease, transfer or otherwise dispose of any or all of its assets (upon voluntary liquidation or otherwise) to Borrower or any other Wholly-Owned Subsidiary of Borrower (and may thereafter be dissolved);

(c)     Borrower may make any Permitted Acquisition (which may be effected through a merger of a Subsidiary with or into an acquired Person); and

(d)     Borrower may carry out the European Reorganization, may continue its departure from the computer-monitor apperture business, may complete the sale and transfer of its operations in Saint Paul, Minnesota, and may close its operations in Azusa, California (including the exercise by Vision-Ease Lens Azusa, Inc. of its option to purchase certain real estate under its current leases and to sell such real estate).

8.5    Restricted Payments.  Either:  (i) declare or pay any dividend or make any distribution on or in respect of its Capital Stock or to the direct or indirect holders of its Capital Stock (except dividends or distributions payable solely in its Non-Convertible Capital Stock or in options, warrants or other rights to purchase its Non-Convertible Capital Stock and except dividends or distributions payable to Borrower or a Subsidiary of Borrower) or (ii) purchase, redeem or otherwise acquire or retire for value any Capital Stock of Borrower (any such dividend, distribution, purchase, redemption, repurchase, defeasance, other acquisition, retirement or Investment being hereinafter referred to as a "Restricted Payment"); provided, however, that during such time as no Event of Default or Unmatured Event of Default has occurred and is continuing or would result therefrom, Borrower or any Wholly-Owned Subsidiary of Borrower may make Restricted Payments in any fiscal year of Borrower consisting of repurchases of Capital Stock of Borrower in an aggregate amount not to exceed $1,000,000.

8.6    Distributions from Subsidiaries.  Create or otherwise cause or permit to exist or become effective any consensual encumbrance or restriction on the ability of any Subsidiary of Borrower to (i) pay dividends or make any other distributions on its Capital Stock or pay any Indebtedness or other obligation owed to Borrower or any of its other Subsidiaries, (ii) make any loans or advances to Borrower or any of its other Subsidiaries, or (iii) transfer any of its property or assets to Borrower or any of its other Subsidiaries, except:

(a)     any encumbrance or restriction pursuant to an agreement in effect at or entered into on the Closing Date and reflected on Schedule 8.6(a) hereto;

(b)     any encumbrance or restriction with respect to a Subsidiary of Borrower pursuant to an agreement relating to any Indebtedness issued by such Subsidiary on or prior to the date on which such Subsidiary became a Subsidiary of Borrower or was acquired by Borrower (other than Indebtedness issued as consideration in, or to provide all or any portion of the funds utilized to consummate, the transaction or series of related transactions in contemplation of or pursuant to which such Subsidiary became a Subsidiary or was acquired by Borrower) and outstanding on such date;

(c)     any such encumbrance or restriction consisting of customary non-assignment provisions in leases or other contracts governing leasehold interests or other contract rights to the extent such provisions restrict the transfer of the lease, contract or rights; and

(d)     in the case of clause (iii) above, restrictions contained in security agreements securing Indebtedness of a Subsidiary of Borrower to the extent such restrictions restrict the transfer of the property subject to such security agreements.

8.7    Sales of Assets and Subsidiary Stock.  Convey, sell, lease or otherwise dispose of (or agree to do any of the foregoing without the Agent's prior written consent) all or any part of the property or assets of a Subsidiary of Borrower with a value in excess of $1,000,000 unless Borrower or such Subsidiary receives consideration at the time of such disposition at least equal to the fair market value, as determined in good faith by the board of directors of such Person (including a determination as to the value of all noncash consideration), of the shares and assets subject to such disposition.  The Net Sale Proceeds of any disposition shall be applied in the manner set forth in Section 4.3.

8.8    Investments.  Make any Investments except for Permitted Investments.

8.9    Transactions with Affiliates.  Conduct any business or enter into any transaction or series of similar transactions (including the purchase, sale, lease or exchange of any property or the rendering of any service) with any Affiliate of Borrower or any legal or beneficial owner of 5% or more of any class of Capital Stock of Borrower or with any Affiliate of such owner (other than a Wholly-Owned Subsidiary of Borrower or an employee stock ownership plan for the benefit of Borrower's or any of its Subsidiaries' employees) unless the terms of such business, transaction or series of transactions are (i) as favorable to Borrower or such Subsidiary as terms that would be obtainable at the time for a comparable transaction or series of similar transactions in arm's‑length dealings with an unrelated third person or, if such transaction is not one which by its nature could be obtained from such person, is on fair and reasonable terms and (ii) are in the ordinary course of business or, if not in the ordinary course of business, are set forth in writing and the board of directors of Borrower or such Subsidiary, as the case may be, has determined in good faith that such business or transaction or series of transactions meets the applicable criteria set forth in clause (i) above.

8.10   Sale-Leasebacks.  Lease any property as lessee in connection with a Sale and Leaseback Transaction entered into after the Closing Date if, at the time of such entering into and after giving effect thereto, Attributable Debt for such Sale and Leaseback Transaction and for all Sale and Leaseback Transactions so entered into by Borrower and its Subsidiaries from and after the Closing Date shall exceed $5,000,000.

8.11   Fiscal Year.  Change the fiscal year of Borrower.

8.12   Amendments to Organizational Documents.  Amend, modify or waive, or permit any amendment, modification or waiver as to any material provision of its articles of incorporation, by-laws or other similar governing documents if such amendment, modification or waiver would adversely affect the interests of Agent or the Lenders.

8.13   Accounting Changes.  Make or permit to be made any change in accounting policies affecting the presentation of financial statements or reporting practices from those employed by it on the date hereof, unless (i) such change is required by GAAP, (ii) such change is disclosed to the Lenders through Agent or otherwise and (iii) relevant prior financial statements that are affected by such change are restated (in form and detail reasonably satisfactory to Agent) as may be required by GAAP to show comparative results.

8.14   Lines of Business.  Enter into or acquire any line of business which is not reasonably related to the business engaged in as of the date hereof.

8.15   Limitation on Voluntary Payments.  Make any voluntary prepayment of, or redeem, repurchase or defease, any Indebtedness except (i) prepayments of the Obligations and (ii) mandatory prepayments required pursuant to the instrument evidencing such Indebtedness or pursuant to which any such Indebtedness was issued.

ARTICLE IX
EVENTS OF DEFAULT

9.1    Events of Default.  If any of the events, acts, conditions or occurrences (each, an "Event of Default") hereinafter set forth shall occur or exist (for any reason whatsoever, and whether such happening shall be voluntary or involuntary or come about or be effected by operation of law or pursuant to or in accordance with any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body):

(a)     Failure to Make Payments When Due.  (i) Borrower shall default in the payment when due of principal on any Loan in accordance with the terms hereof or any reimbursement obligation with respect to any Letter of Credit; or (ii) Borrower shall default in the payment when due of interest on any Loan in accordance with the terms hereof and such default shall continue for five (5) days after the date when due; or (iii) Borrower shall default in the payment when due of any other amount owing hereunder or any other Loan Document and such default shall continue for ten (10) days after the date when due; or

(b)     Representations.  Any representation or warranty made or deemed to be made by Borrower or any Credit Party herein or in any document, instrument or certificate delivered by a Credit Party pursuant hereto shall prove to have been incorrect or misleading in any material respect on or as of the date made or deemed made; or

(c)     Breach of Certain Covenants.  Borrower shall fail to perform or comply with any term or condition contained in Sections 7.1, 7.2, 7.3 or 7.12, Article VIII; or

(d)     Other Defaults Under Agreement or Loan Documents.  Borrower or any of its Subsidiaries shall default in the performance or observance of any term, covenant, condition or agreement contained in this Agreement (other than as provided in clauses (a), (b) or (c) of this Section 9.1), or any other Loan Document and such default shall continue unremedied for a period of 30 days after written notice thereof shall have been given to Borrower by Agent or the Required Lenders; or

(e)     Default Under Other Agreements.  Borrower or any of its Subsidiaries (i) shall default in the payment when due (after giving effect to any applicable grace period), whether at stated maturity or otherwise, of principal or interest in respect of Indebtedness having an aggregate principal amount of $5,000,000 or more; or (ii) shall fail to perform or observe any other condition or covenant, or any other event shall occur or condition exist, under any agreement or instrument relating to any such Indebtedness having an aggregate principal amount of $5,000,000, if the effect of any such failure, event or condition is to cause, or to permit the holder or holders of such Indebtedness or beneficiary or beneficiaries of such Indebtedness (or a trustee or agent on behalf of such holder or holders or beneficiary or beneficiaries) to cause (determined without regard to whether any notice of acceleration or similar notice is required), such Indebtedness to be declared to be due and payable prior to its stated maturity, or cash collateral in respect thereof to be demanded; or

(f)     Judgments.  One or more judgments or decrees shall be entered against Borrower or any of its Subsidiaries involving, individually or in the aggregate, a liability of $7,500,000 or more and all such judgments or decrees shall not have been vacated, discharged or stayed pending appeal within sixty (60) days from the entry thereof but in any event prior to the commencement of enforcement proceedings; or

(g)     Voluntary Insolvency, Etc.  Borrower or any of its Material Subsidiaries shall become insolvent, generally fail to pay, or state in writing or publicly its inability or unwillingness to pay, its debts as they become due or call a meeting of creditors for the purpose of adjusting its debts; or Borrower or any of its Material Subsidiaries shall become insolvent or shall voluntarily commence any proceeding or file any petition under any bankruptcy, insolvency or similar law seeking dissolution or reorganization or the appointment of a receiver, trustee, custodian or liquidator for it or a substantial portion of its property, assets or business, or to effect a plan or other arrangement with its creditors, or shall file any answer admitting the jurisdiction of the court and the material allegations of an involuntary petition filed against it in any bankruptcy, insolvency or similar proceeding, or shall be adjudicated bankrupt, or shall make a general assignment for the benefit of creditors, or shall consent to, or acquiesce in the appointment of, a receiver, trustee, custodian or liquidator for a substantial portion of its property, assets or business; or

(h)     Involuntary Insolvency, Etc.  Involuntary proceedings or an involuntary petition shall be commenced or filed against Borrower or any of its Material Subsidiaries under any bankruptcy, insolvency or similar law or seeking the dissolution or reorganization of it or the appointment of a receiver, trustee, custodian or liquidator for it or of a substantial part of its property, assets or business, or any writ, judgment, warrant of attachment, execution or similar process shall be issued or levied against a substantial part of its property, assets or business, and such proceedings or petition shall not be dismissed, or such writ, judgment, warrant of attachment, execution or similar process shall not be released, vacated or fully bonded, within sixty (60) days after commencement, filing or levy, as the case may be, or any order for relief shall be entered in any such proceeding; or

(i)     Unenforceability.  This Agreement or any other Loan Document shall cease for any reason to be in full force and effect (other than by reason of any action by Agent or any Lender or the satisfaction of all Borrower's or any of its Subsidiaries' obligations thereunder) or Borrower or any of its Subsidiaries or any other Person (other than the Lenders or Agent) shall disavow its obligations under any provision hereof or thereof, or shall deny that it has any or further obligations under any provision thereof, or shall contest the validity or enforceability of any provision thereof; or

(j)     ERISA.

(i)  A Reportable Event or Reportable Events, or a failure to make a required installment or other payment (within the meaning of Section 412(n)(l) of the Code), shall have occurred with respect to any Plan or Plans that would reasonably be expected to result in liability of Borrower to the PBGC or to a Plan in each case in an aggregate amount exceeding $7,500,000 and the Agent shall have notified Borrower in writing that (x) the Required Lenders have made a determination that, on the basis of such Reportable Event or Reportable Events or such failure to make a required payment, there are reasonable grounds (A) for the termination of such Plan or Plans by the PBGC, (B) for the appointment by the appropriate United States District Court of a trustee to administer such Plan or Plans or (C) for the imposition of a lien in favor of a Plan and (y) as a result thereof an Event of Default exists hereunder; or a Termination Event shall have occurred; or

(ii)     The Borrower or any ERISA Affiliate shall have been notified by the sponsor of a Multiemployer Plan that it has incurred Withdrawal Liability to such Multiemployer Plan and the amount of the Withdrawal Liability specified in such notice, when aggregated with all other Withdrawal Liabilities (determined as of the date or dates of such notification), exceeds $7,500,000; or

(iii)    Borrower or any ERISA Affiliate shall have been notified by the sponsor of a Multiemployer Plan that such Multiemployer Plan is in reorganization or is being terminated, within the meaning of Title IV of ERISA, if solely as a result of such reorganization or termination the aggregate annual contributions of Borrower and its ERISA Affiliates to all Multiemployer Plans that are then in reorganization or have been or are being terminated have been or will be increased over the amounts required to be contributed to such Multiemployer Plans for their most recently completed plan years by an amount exceeding $7,500,000; or

(k)     Change of Control.  A Change of Control shall occur; or

(l)     Environmental Default.  The Borrower or any of its Subsidiaries shall be the subject of any proceeding or investigation pertaining to the release by Borrower or any of its Subsidiaries, or any other Person of any toxic or hazardous waste or substance into the environment, or any violation of any Environmental Law, which, in either case, would reasonably be expected to have a Material Adverse Effect; or

(m)    Security Documents.  At any time after the execution and delivery thereof, any of the Security Documents shall cease to be in full force and effect in accordance with the terms thereof or shall cease to give Agent for the benefit of the Lenders the Liens, rights, powers and privileges purported to be created thereby (including, without limitation, a first priority perfected security interest (subject to Permitted Liens) in, and Lien on, all of the Collateral for which Agent or Collateral Agent has taken necessary actions to perfect its security interest), in favor of Agent, superior to and prior to the rights of all third Persons and subject to no other Liens (except to the extent expressly permitted herein or therein); or any Credit Party shall default in the due performance or observance of any term, covenant or agreement on its part to be performed or observed pursuant to any of the Security Documents and such default shall continue beyond any grace period specifically applicable thereto pursuant to the terms of such Security Document.

THEN, and in any such event (except an Event of Default specified in paragraph (g) or (h) of this Section) and at any time thereafter while an Event of Default is continuing, Agent may with the consent of Required Lenders, and at the direction of the Required Lenders shall, take one or more of the following actions: (A) declare the Revolving Commitments terminated, whereupon the Revolving Commitment(s) of each Lender hereunder shall terminate immediately and all fees and other amounts accrued in accordance with this Agreement shall forthwith become due and payable without any other notice of any kind; (B) declare all sums then owing by Borrower hereunder and under the Notes to be forthwith due and payable, whereupon all such sums shall become and be immediately due and payable without presentment, demand, protest or notice of any kind, all of which are hereby expressly waived by Borrower; (C) exercise on behalf of itself and the Lenders all rights and remedies available to it and the Lenders under the Loan Documents or applicable law and (D) terminate any Letter of Credit which may be terminated in accordance with its terms, (iv) direct Borrower to pay (and Borrower agrees that upon receipt of such notice, or upon the occurrence of any Event of Default specified in Section 9.1(g) or Section 9.1(h) with respect to Borrower it will pay) to Agent such additional amount of cash, to be held as security by Agent, as is equal to the aggregate Stated Amount of all Letters of Credit issued for the account of Borrower and its subsidiaries and then outstanding, provided, however, that if an Event of Default specified in paragraph (g) or (h) of this Section shall occur, the result which would occur upon the giving of notice by Agent to Borrower, as specified in clauses (A) or (B) above, shall occur automatically without the giving of any such notice.  Promptly following the making of any such declaration, Agent shall give notice thereof to Borrower and each Lender, but failure to notify any Person shall not impair the effect of such declaration.

9.2    Rescission of Acceleration.  Anything in Section 9.1 to the contrary notwithstanding, Agent shall, at the request of the Required Lenders, rescind and annul any acceleration of the Notes under this Agreement by written instrument filed with Borrower; provided, however, that at the time such acceleration is so rescinded and annulled:

(i)     all past due interest and principal, if any, on the Notes and all other sums payable under this Agreement (except any principal and interest on any Notes which has become due and payable solely by reason of such acceleration) shall have been duly paid, and

(ii)     no other Event of Default or Unmatured Event of Default shall have occurred and be continuing which shall not have been waived in accordance with this Agreement.

9.3    Rights Not Exclusive.  The rights provided for in this Agreement and the other Loan Documents are cumulative and are not exclusive of any other rights, powers, privileges or remedies provided by law or in equity, or under any other instrument, document or agreement now existing or hereafter arising.

ARTICLE X
AGENT

10.1   Appointment and Authorization.  Each Lender hereby irrevocably appoints, designates and authorizes DBTCA as Agent (for purposes of this Article X the term "Agent" shall include DBTCA in its capacity as Collateral Agent pursuant to the Security Documents) and each holder of any Note by the acceptance of such Note shall be deemed irrevocably to have authorized Agent to take such action on its behalf under the provisions of this Agreement and each other Loan Document and to exercise such powers and perform such duties as are expressly delegated to it by the terms of this Agreement or any other Loan Document, together with such powers as are reasonably incidental thereto (including, without limitation, to give notices and take such actions on behalf of the Required Lenders as are consented to in writing by the Required Lenders).  Agent may perform any of its duties hereunder, or under the other Loan Documents, by or through its agents or employees.

10.2   Nature of Duties.  Agent shall have no duties or responsibilities except those expressly set forth in this Agreement.  The duties of Agent shall be mechanical and administrative in nature.  EACH LENDER HEREBY ACKNOWLEDGES AND AGREES THAT AGENT SHALL NOT HAVE, BY REASON OF THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, A FIDUCIARY RELATIONSHIP TO OR IN RESPECT OF ANY LENDER.  Nothing in any of the Loan Documents, expressed or implied, is intended to or shall be so construed as to impose upon Agent any obligations in respect of any of the Loan Documents except as expressly set forth herein or therein.  Each Lender shall make its own independent investigation of the financial condition and affairs of Borrower in connection with the making and the continuance of the Loans hereunder and shall make its own appraisal of the credit worthiness of Borrower, and Agent shall have no duty or responsibility, either initially or on a continuing basis, to provide any lender with any credit or other information with respect thereto, whether coming into its possession before making of the Loans or at any time or times thereafter.  Agent will promptly notify each Lender at any time that the Required Lenders have instructed it to act or refrain from acting pursuant to Article IX.

10.3   Liability of Agent.  Agent, its Affiliates, or any of their respective officers, directors, employees, agents, affiliates or attorneys‑in‑fact (collectively, the "Agent‑Related Persons") shall not (i) be liable to any of the Lenders 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 (except for their own gross negligence or willful misconduct), or (ii) be responsible in any manner to any of the Lenders for any recital, statement, representation or warranty made by Borrower or Affiliate of Borrower, or any officer 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, or the Documentation Agent under or in connection with, this Agreement or any other Loan Document, or the execution, validity, effectiveness, genuineness, enforceability, collectibility or sufficiency of this Agreement or any other Loan Document, or for any failure of Borrower to perform its obligations hereunder or thereunder.  No Agent‑Related Person shall be under any obligation to any Lender to ascertain or to inquire as to the observance or performance of any of the terms or provisions contained in, or conditions of, this Agreement or any other Loan Document, or the financial condition of Borrower, or the existence or possible existence of any Unmatured Event of Default or Event of Default unless requested to do so by the Required Lenders, or to inspect the properties, books or records of Borrower or any of its Subsidiaries or Affiliates.

10.4   Reliance by Agent.

(a)     The Lenders agree that Agent shall be entitled to rely, and shall be fully protected in relying, upon any writing, resolution, notice, consent, certificate, affidavit, letter, telegram, facsimile, 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), independent accountants and other experts selected by Agent.  Agent may at any time request instructions from the Lenders with respect to actions or approvals (including the failure to act or approve) which by the terms of any of the Loan Documents Agent is permitted or required to take or to grant.  The Lenders agree that Agent shall be fully justified in failing or refusing to take any action under this Agreement or any other Loan Document unless it shall first receive such advice or concurrence of the Required Lenders as it deems appropriate and, if it so requests, it shall first be indemnified to its satisfaction by the Lenders against any and all liability and expense which may be incurred by it by reason of taking or continuing to take any such action.  The Lenders agree that 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 or consent and any action taken or failure to act pursuant thereto shall be binding upon all of the Lenders.

(b)     For purposes of determining compliance with the conditions specified in Sections 6.1 and 6.2, each Lender that has executed this Agreement shall be deemed to have consented to, approved or accepted or to be satisfied with each document or other matter required thereunder to be consented to or approved by or acceptable or satisfactory to the Lender, unless an officer of Agent, responsible for the transactions contemplated by the Loan Documents shall have received notice from the Lender prior to the initial Borrowing specifying in reasonable detail its objection thereto and either such objection shall not have been withdrawn by notice to Agent to that effect, or the Lender shall not have made available to Agent the Lender's ratable portion of such Borrowing.

10.5   Notice of Default.  Agent shall not be deemed to have knowledge or notice of the occurrence of any Event of Default or Unmatured Event of Default, except with respect to defaults in the payment of principal, interest and fees required to be paid to Agent for the account of the Lenders, unless Agent shall have received written notice from a Lender or Borrower referring to this Agreement, describing such Event or Default or Unmatured Event of Default and stating that such notice is a "notice of default".  In the event that Agent receives such a notice, Agent shall give notice thereof to the Lenders.  Agent shall take such action with respect to such Event of Default or Unmatured Event of Default as shall be requested by the Required Lenders in accordance with Article IX; provided, however, that unless and until Agent shall have 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 Event of Default or Unmatured Event of Default as it shall deem advisable or in the best interest of the Lenders.

10.6   Credit Decision.  Each Lender expressly acknowledges that none of the Agent‑Related Persons has made any representation or warranty to it and that no act by any Agent, hereinafter taken, including any review of the affairs of Borrower and its Subsidiaries shall be deemed to constitute any representation or warranty by such Agent to any Lender.  Each Lender represents to Agent that it has, independently and without reliance upon Agent and based on such documents and information as it has deemed appropriate, made its own appraisal of and investigation into the business, prospects, operations, property, financial and other condition and creditworthiness of Borrower and its Subsidiaries, and all applicable bank regulatory laws relating to the transactions contemplated thereby, and made its own decision to enter into this Agreement and extend credit to Borrower hereunder.  Each Lender also represents that it will, independently and without reliance upon Agent, 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 its Subsidiaries.  Except for notices, reports and other documents expressly herein required to be furnished to the Lenders by Agent, Agent shall not have any duty or responsibility to provide any Lender with any credit or other information concerning the business, prospects, operations, property, financial and other condition or creditworthiness of Borrower which may come into the possession of any of the Agent‑Related Persons.

10.7   Indemnification.  The Lenders shall indemnify upon demand 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), ratably according to each Lender's Commitment Percentage from and against any and all liabilities, obligations, losses, damages, claims, penalties, actions, judgments, suits, costs, and reasonable expenses and disbursements of any kind whatsoever which may at any time (including at any time following the repayment of the Loans) be imposed on, incurred by or asserted against any such Person any way relating to or arising out of this Agreement or any document contemplated by or referred to herein or therein or the transactions contemplated hereby or thereby or any action taken or omitted by any such Person under or in connection with any of the foregoing; provided, however, that no Lender shall be liable for the payment to the Agent‑Related Persons of any portion of such liabilities, obligations, losses, damages, claims, penalties, actions, judgments, suits, costs, expenses or disbursements resulting from such Person's gross negligence or willful misconduct.  Without limitation of the foregoing, each Lender shall reimburse Agent upon demand for its ratable share of any reasonable costs or out‑of‑pocket expenses (including Attorney Costs) 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, any other Loan Document, or any document contemplated by or referred to herein to the extent that Agent is not reimbursed for such expenses by or on behalf of Borrower.  Without limiting the generality of the foregoing, if the IRS or any authority of the U.S. or other jurisdiction asserts a claim that Agent did not properly withhold tax from amounts paid to or for the account of any Lender (because the appropriate form was not delivered, was not properly executed, or because such Lender failed to notify Agent of a change in circumstances which rendered the exemption from, or reduction of, withholding tax ineffective, or for any other reason) such Lender shall indemnify Agent fully for all amounts paid, directly or indirectly, by Agent as tax or otherwise, including penalties and interest, and including any taxes imposed by any jurisdiction on the amounts payable to Agent under this Section 10.7, together with all Attorney Costs.  The obligation of the Lenders in this Section 10.7 shall survive the payment of all Obligations hereunder and termination of the Agreement.

10.8   Agent in Individual Capacity.  Agent and its Affiliates may make loans to, issue letters of credit for the account of, accept deposits from, acquire equity interests in and generally engage in any kind of banking, trust, financial advisory or other business with Borrower and its Subsidiaries and Affiliates as though Agent were not Agent hereunder and without notice to the Lenders.  With respect to its Loans, Agent shall have the same rights and powers under this Agreement as any other Lender and may exercise the same as though it were not Agent hereunder or under any other Loan Document, including, without limitation, the acceptance of fees or other consideration for services without having to account for the same to any of the Lenders.  The terms "Lender" and "Lenders" shall include DBTCA in its individual capacity.

10.9   Resignation by Agent.

(a)     Agent may resign from the performance of all its functions and duties hereunder at any time by giving fifteen (15) Business Days' prior written notice to Borrower and the Lenders.  Such resignation shall take effect upon the acceptance by a successor Agent of appointment pursuant to clauses (b) and (c) below or as otherwise provided below.

(b)     Upon any such notice of resignation, the Required Lenders shall appoint a successor Agent who shall (unless an Event of Default has occurred and is continuing) be satisfactory to Borrower and shall be an incorporated bank or trust company.

(c)     If a successor Agent shall not have been so appointed within said 15 Business Day period, Agent, with the consent of Borrower, shall then appoint a successor Agent who shall serve as Agent until such time, if any, as the Required Lenders, with the consent of Borrower, appoint a successor Agent as provided above.

(d)     If no successor Agent has been appointed pursuant to clause (b) or (c) by the 20th Business Day after the date such notice of resignation was given by Agent, Agent's resignation shall become effective and the Required Lenders shall thereafter perform all the duties of Agent hereunder until such time, if any, as the Required Lenders, with the consent of Borrower, appoint a successor Agent as provided above.

(e)     Upon the effective date of such resignation, only 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 rights, powers and duties in such capacity shall be terminated.  After any retiring Agent resigns hereunder as Agent the provisions of this Article X and Section 11.4 shall inure to their respective benefit as to any actions taken or omitted to be taken by it while it was Agent under this Agreement; except with respect to indemnification provisions under this Agreement which shall survive as to such resigning Agent.

10.10  Documentation Agent.  The designation of Bank One, NA as Documentation Agent shall not impose upon it any obligation or liability to the Borrower or any Lender.

ARTICLE XI
MISCELLANEOUS

11.1   No Waiver; Modifications in Writing.  

(a) No failure or delay on the part of Agent or any Lender in exercising any right, power or remedy under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any such right, power or remedy preclude any other or further exercise thereof or the exercise of any other right, power or remedy.  The remedies provided for in this Agreement are cumulative and are not exclusive of any remedies that may be available to Agent or any Lender at law or in equity or otherwise.  No amendment, modification, supplement, termination or waiver of or to any provision of this Agreement or any Note, nor consent to any departure by Borrower therefrom, shall be effective unless the same shall be consented to by or on behalf of Borrower and the Required Lenders; provided, however, that the consent of each Lender (other than a Defaulting Lender) affected thereby shall be required to effect any amendment, modification, supplement, termination, waiver or consent, as the case may be (any of the foregoing, a "Modification"), which has the effect of

(i)     reducing the aggregate principal amount of, or interest rate on, any of the Revolving Notes or Term Notes or releasing any Subsidiary Guarantor (other than as a result of a transaction permitted by Section 8.4 or an Asset Disposition made in accordance with the terms of this Agreement) or reducing the aggregate amount of any fees provided for in this Agreement, except that any Modification that has the effect of reducing the aggregate amount of any fees payable to Agent for its own account shall require only the consent of Agent;

(ii)     extending the stated final maturity of any of the Revolving Commitments, Term Loans or the Notes or extending the date of any portion of any payment of principal of, or interest or fees in respect of, any of the Revolving Commitments, Term Loans or Notes (it being understood that modifying or waiving any Event of Default or Unmatured Event of Default (other than an Event of Default described in Section 9.1(a)(i), 9.1(g) or 9.1(h)) or amending the mandatory prepayment provisions or financial covenants shall not constitute an extension of the final stated maturity or extension of the date of any payment of any Commitment,  Loan or Note); or

(iii)    changing this proviso or the first sentence of Section 11.9(a), reducing the percentage specified in the definition of the term "Required Lenders", or (except in connection with a permitted assignment by any Lender under this Agreement) the definition of the terms "Revolving Commitment", "Term Loans" or "Commitment Percentage" (it being understood with respect to all of the foregoing that, with the consent of the Required Lenders, additional extensions of credit pursuant to this Agreement may be included in the determination of the Required Lenders);

(iv)    releasing any of the Pledged Stock (except as expressly provided in the applicable Security Documents) under all of the Security Documents; or

(v)    releasing any of the Collateral (except as expressly provided in Section 11.20(b));

provided, further, that no such amendment, modification, supplement, waiver, discharge, termination or other change shall (1) without the consent of the Majority Lenders of each Facility which is being allocated a lesser prepayment, repayment or commitment reduction, alter the required application of any prepayments or repayments (or commitment reduction), as between the various Facilities (although the Required Lenders may waive in whole or in part, any such prepayment, repayment or commitment reduction so long as the application, as amongst the various Facilities, of any such prepayment, repayment or commitment reduction which is still required to be made is not altered) (it being understood with respect to all of the foregoing that, with the consent of the Required Lenders, the definition of Majority Lenders may be amended to permit additional extensions of credit as otherwise permitted by this Agreement) or (2) amend the definitions of "Borrowing Base", "Eligible Receivables", or "Eligible Inventory" without the consent of the Supermajority Lenders of the Revolving Loan Facility;

provided, further, that the consent of Agent shall be required to effect any Modification that has the effect of (x) increasing the duties or obligations of Agent, (y) increasing the standard of care or performance required on the part of Agent, or (z) reducing or eliminating the indemnities, exculpations or immunities to which Agent is entitled;

Any Modification of or to any provision of this Agreement shall be effective only in the specific instance and for the specific purpose for which made or given and only if in writing.  Except where notice is specifically required by this Agreement, no notice to or demand on Borrower or any other Person in any case shall entitle Borrower or such other Person to any other or further notice or demand in similar or other circumstances.

 (b)  If, in connection with any proposed amendment, change, supplement, waiver, discharge or termination of any of the provisions of this Agreement as contemplated by clauses (a)(i) through (v), inclusive, of the first proviso to the third sentence of Section 11.1(a), the consent of the Required Lenders is obtained but the consent of one or more of such other Lenders whose consent is required is not obtained, then Borrower shall have the right, so long as all non‑consenting Lenders whose individual consent is required are treated as described in either clauses (A) or (B) below, to either (A) replace each such non‑consenting Lender or Lenders (or, at the option of the Borrower if the respective Lender's consent is required with respect to less than all Loans, to replace only the respective Loans of the respective non-consenting Lender which gave rise to the need to obtain such Lender's individual consent) with one or more Replacement Lenders pursuant to Section 3.7 so long as at the time of such replacement, each such Replacement Lender consents to the proposed amendment, modification, supplement, waiver, discharge, termination or other change or (B) terminate such non‑consenting Lender's Revolving Commitment and repay all outstanding Loans of such Lender which gave rise to the need to obtain such Lender's consent, in accordance with Section 4.l(b) and/or 4.2; provided that, unless the Revolving Commitment is terminated and Loans repaid pursuant to the preceding clause (B) are immediately replaced in full at such time through the addition of new Lenders or the increase of the Commitments and/or outstanding Loans of existing Lenders (who in each case must specifically consent thereto), then in the case of any action pursuant to preceding clause (B) the Required Lenders (determined before giving effect to the proposed action) shall specifically consent thereto, provided, further, that in any event Borrower shall not have the right to replace a Lender, terminate its Revolving Commitment or repay its Loans solely as a result of the exercise of such Lender's rights (and the withholding of any required consent by such Lender) contemplated by the second proviso to the third sentence of Section 11.1(a).

11.2   Intentionally omitted.

11.3   Notices, Etc.  Except where telephonic instructions or notices are authorized herein to be given, all notices, demands, instructions and other communications required or permitted to be given to or made upon any party hereto or any other Person shall be in writing and shall be personally delivered or sent by registered or certified mail, postage prepaid, return receipt requested, or by a reputable courier delivery service, or by prepaid telex, TWX or telegram (with messenger delivery specified in the case of a telegram), or by telecopier, and shall be deemed to be given for purposes of this Agreement on the day received if deposited in registered or certified mail, postage prepaid, and otherwise on the day that such writing is delivered or sent to the intended recipient thereof, or in the case of notice delivered by telecopy, upon completion of transmission with a copy of such notice also being delivered under any of the methods provided above, all in accordance with the provisions of this Section provided that any notice, request or demand to or upon any Agent or the Lenders pursuant to Sections 2.1, 2.2, 3.4 or 4.1 shall not be effective until received.  Unless otherwise specified in a notice sent or delivered in accordance with the foregoing provisions of this Section, notices, demands, instructions and other communications in writing shall be given to or made upon the respective parties hereto at their respective addresses (or to their respective telex, TWX or telecopier numbers) indicated on Schedule 11.3 hereto or in any applicable Assignment and Assumption Agreement and, in the case of telephonic instructions or notices, by calling the telephone number or numbers indicated for such party on Schedule 11.3 hereto or in any applicable Assignment and Assumption Agreement (in each case as such may be modified from time to time by notice hereunder).

11.4   Costs, Expenses and Taxes; Indemnity.

(a)     Generally.  Borrower agrees (without duplication) to pay promptly upon written request by Agent, which shall include reasonable detail (i) all reasonable costs and expenses in connection with the negotiation, preparation, printing, typing, reproduction, execution and delivery of this Agreement and the other Loan Documents and the documents and instruments referred to herein and therein and any amendment, waiver, consent relating hereto or thereto or other modifications of (or supplements to) any of the foregoing and any and all other documents and instruments furnished pursuant hereto or thereto or in connection herewith or therewith, including without limitation, the reasonable fees and out-of-pocket expenses of Winston & Strawn, special counsel to Agent, and any local counsel retained by Agent relative thereto, other Attorney Costs, independent public accountants and other outside experts retained by Agent in connection with the administration of this Agreement and the other Loan Documents, and (ii) all reasonable costs and expenses (including, without limitation, Attorney Costs), if any, paid by Agent or any Lender in connection with the enforcement of this Agreement, any of the Loan Documents or any other agreement furnished by Borrower or any of its Subsidiaries pursuant hereto or thereto or in connection herewith or therewith.  In addition, Borrower shall pay any and all present and future stamp, transfer excise and other similar taxes payable or determined to be payable in connection with the execution and delivery of this Agreement, any Loan Document, or the making of any Loan, and each agrees to save and hold Agent and each Lender harmless from and against any and all liabilities with respect to or resulting from any delay by Borrower in paying, or omission by Borrower to pay, such taxes.  Any portion of the foregoing fees,  costs and expenses which remains unpaid more than thirty (30) days following Agent's or any Lender's statement and request for payment thereof shall bear interest from the date of such statement and request to the date of payment at the Default Rate.

(b)     Indemnification.  Borrower will indemnify and hold harmless Agent and each Lender and each director, officer, employee, agent and Affiliate of each Agent and each Lender (collectively, the "Indemnified Persons") from and against all losses, claims, damages, penalties, causes of action, obligations, costs, expenses or liabilities (including, without limitation, Attorney Costs and reasonable expenses, consultant fees and investigation fees) (collectively, "Expenses") to which such Indemnified Person shall become subject, insofar as such Expenses (or actions, suits or proceedings, including, without limitation, any inquiry or investigation or claim in respect thereof, whether or not any Indemnified Person is named as a party) arise out of, in any way relate to, or result from the transactions contemplated by this Agreement and to reimburse each Indemnified Person upon its written demand showing reasonable detail, for any legal or other expenses incurred in connection with investigating, preparing to defend or defending any such loss, claim, damage, liability, action or claim; provided, however, that Borrower shall have no obligation to an Indemnified Person hereunder with respect to indemnified liabilities arising from the gross negligence or willful misconduct of any such Indemnified Person or for any loss, claim, damage, liability, action or claim incurred by such Indemnified Person hereunder resulting solely from the gross negligence or willful misconduct of such Indemnified Person; and provided, further, however, that no Indemnified Person may settle any such action, suit or proceeding without the consent of Borrower which consent shall not be unreasonably withheld or delayed.  If an action, suit or proceeding arising from any of the foregoing is brought against any Indemnified Person, Borrower shall, if requested by such Indemnified Person, resist and defend at its own expense such action, suit or proceeding or cause the same to be resisted and defended by counsel reasonably satisfactory to such Indemnified Person.  Each Indemnified Person shall have the right to employ its own counsel to investigate and control the defense of any matter covered by such indemnity and the reasonable fees and expenses of such counsel shall be at the expense of the indemnifying party, provided, however, that in any one action or separate but similar or related actions in the same jurisdiction arising out of the same general allegations or circumstances, Borrower shall not be liable for fees and expenses of more than one counsel (in addition to any local counsel), which counsel shall be designated by the Agent provided, further, however, each Indemnified Person shall have the right to employ separate counsel in any such inquiry, action, claim or proceeding and to control the defense thereof, and the reasonable fees and expenses of such counsel shall be at the expense of the Borrower if (i) Borrower shall have agreed in writing to pay such fees and expenses or (ii) such Indemnified Person shall have notified Borrower that it has been advised by counsel that there may be one or more legal defenses available to such Indemnified Person that are different from or additional to those available to the other Indemnified Persons and that such common representation would adversely impact the adequacy of the proposed representation.  If Borrower shall fail to do, or cause to be done, any act or thing which it has covenanted to do or cause to be done under this Agreement or any representation or warranty on the part of Borrower contained in any Loan Document shall be breached, Agent may (but shall not be obligated to) do the same or cause it to be done or remedy any such breach, and may expend its own funds for such purpose, and will use its best efforts to give prompt written notice to Borrower that it proposes to take such action; provided, however, that any failure by Agent to do any such act or thing or give any such notice shall not relieve Borrower of any such obligations and shall not impose or result in the imposition of any liability on Agent or any Lender.  Any and all amounts so expended by Agent shall be due and payable by Borrower promptly upon Agent's written demand therefor, together with interest thereon at a rate per annum equal to the Default Rate during the period from and including the date so demanded by Agent to the date of repayment.  To the extent that the undertaking to indemnify, pay or hold harmless Agent or Lender as set forth in this Section 11.4 may be unenforceable because it is violative of any law or public policy, Borrower shall make the maximum contribution to the payment and satisfaction of each of the indemnified liabilities which is permissible under applicable law.

(c)     If any sum due from Borrower under this Agreement or any order or judgment given or made in relation hereto has to be converted from the currency (the "first currency") in which the same is payable hereunder or under such order or judgment into another currency (the "second currency") for the purpose of (i) making or filing a claim or proof against Borrower with any Governmental Authority or in any court or tribunal, or (ii) enforcing any order or judgment given or made in relation hereto, Borrower shall indemnify and hold harmless each of the Persons to whom such sum is due from and against any loss actually suffered as a result of any discrepancy between (a) the rate of exchange used to convert the amount in question from the first currency into the second currency, and (b) the rate or rates of exchange at which such Person, acting in good faith in a commercially reasonable and prompt manner, purchased the first currency with the second currency after receipt of a sum paid to it in the second currency in satisfaction, in whole or in part, of any such order, judgment, claim or proof.  The foregoing indemnity shall constitute a separate obligation of Borrower distinct from its other obligations hereunder and shall survive the giving or making of any judgment or order in relation to all or any of such other obligations.

(d)     The obligations of Borrower under this Section and the other indemnification obligations of the Borrower under this Agreement shall be effective and binding on Borrower irrespective of whether any Loans are made and shall survive (i) the termination of this Agreement and the discharge of Borrower's other obligations hereunder and under the Notes and (ii) the assignment by any Lender of any of its interests herein pursuant to Section 11.9(c) with respect to any acts, omissions and/or events occurring or arising prior to the Effective Date of such assignment.

(e)     Nothing contained in this Section shall be deemed to limit or reduce any indemnity in favor of any Agent or any Lender contained in any other Loan Document or agreement.

11.5   Confirmations.  Each of Borrower and each holder of a Note agrees, from time to time, upon written request received by it from the other, to confirm to the other in writing (with a copy of each such confirmation to Agent) the aggregate unpaid principal amount of the Loans then outstanding under such Note.

11.6   Transfer of Notes.  In the event that the holder of any Note (including any Lender) shall transfer such Note, it shall immediately advise Agent and Borrower of such transfer, and Agent and Borrower shall be entitled conclusively to assume that no transfer of any Note has been made by any holder (including any Lender) unless and until Agent and Borrower shall have received written notice to the contrary.  Each transferee of any Note shall take such Note subject to the provisions of this Agreement and to any Modification or other action taken under this Agreement prior to the receipt by Agent and Borrower of written notice of such transfer by each previous holder of such Note and, except as expressly otherwise provided in such notice, Agent and Borrower shall be entitled conclusively to assume that the transferee named in such notice shall thereafter be vested with all rights and powers under this Agreement with respect to the Loans of the Lender named as the payee of the Note which is the subject of such transfer.

11.7   Adjustments; Setoff.

(a)     If, other than as expressly set forth elsewhere herein, any Lender shall obtain on account of the Committed Loans made by it any payment (whether voluntary, involuntary, through the exercise of any right of setoff, or otherwise) in excess of its Commitment Percentage of payments on account of the Committed Loans obtained by all the Lenders, such Lender shall forthwith (x) notify Agent of such fact, and (y) purchase from the other Lenders such participations in the Committed Loans made by them as shall be necessary to cause such purchasing Lender to share the excess payment ratably with each of them; provided, however, that if all or any portion of such excess payment is thereafter recovered from the purchasing Lender, such purchase shall to that extent be rescinded and each other Lender shall repay to the purchasing Lender the purchase price paid thereto together with an amount equal to such paying Lender's Commitment Percentage (according to the proportion of (i) the amount of such paying Lender's required repayment to (ii) the total amount so recovered from the purchasing Lender, of any interest or other amount paid or payable by the purchasing Lender in respect of the total amount so recovered.  Agent will keep records (which shall be conclusive and binding in the absence of demonstrable error), of participations purchased pursuant to this Section 11.7 and will in each case promptly notify the Lenders and Borrower following any such purchases.  Any payments received after the Lenders have taken action pursuant to this Section 11.7 shall be allocated ratably among the Revolving Loans and the Swing Line Loans of all the Lenders.

(b)     Borrower agrees that any Lender so purchasing a participation from another Lender pursuant to this Section 11.7 may, to the fullest extent permitted by law, exercise all its rights of payment (including the right of setoff, but subject to Section 11.7(d)) with respect to such participation as fully as if such Lender were the direct creditor of Borrower in the amount of such participation.

(c)     Nothing herein shall require any Lender to exercise any right of setoff or similar rights or shall affect the right of any Lender to exercise, and retain the benefits of exercising, any such right with respect to any other Indebtedness or obligation of Borrower.

(d)     In addition to any rights and remedies of the Lenders provided by law, each Lender shall have the right, without prior notice to Borrower or any other Person, any such notice being expressly waived by Borrower, upon the occurrence of an Event of Default to setoff and apply against any Obligations any and all deposits (general or special, time or demand, provisional or final), in any currency, and any other credits, indebtedness or claims, in any currency, in each case whether direct or indirect, absolute or contingent, whether matured or unmatured, of Borrower to such Lender, any amount owing from such Lender or any branch or agency thereof to or for the credit or account of Borrower, at or at any time after, the happening of  any of the above-mentioned events, and the aforesaid right of setoff may be exercised by such Lender against Borrower or against any trustee in bankruptcy, debtor in possession, assignee for the benefit of creditors, receivers, or execution, judgment or attachment creditor of Borrower, or against anyone else claiming through or against, Borrower or such trustee in bankruptcy, debtor in possession, assignee for the benefit of creditors, receivers, or execution, judgment or attachment creditor, notwithstanding the fact that such right of setoff shall not have been exercised by such Lender prior to the making, filing or issuance, or service upon such Lender of, or of notice of, any such petition, assignment for the benefit of creditors, appointment or application for the appointment of a receiver, or issuance of execution, subpoena, order or warrant.  Each Lender agrees promptly to notify Borrower and Agent after any such setoff and application made by such Lender; provided, however, that the failure to give such notice shall not affect the validity of such setoff and application.

(e)     Borrower expressly agrees that to the extent Borrower makes a payment or payments and such payment or payments, or any part thereof, are subsequently invalidated, declared to be fraudulent or preferential, set aside or are required to be repaid to a trustee, receiver, or any other party under any bankruptcy act, state or federal law, common law or equitable cause, then to the extent of such payment or repayment, the Indebtedness to the Lenders or part thereof intended to be satisfied shall be revived and continued in full force and effect as if said payment or payments had not been made.

11.8   Execution in Counterparts.  This Agreement may be executed in any number of counterparts and by the different parties hereto on separate counterparts, each of which counterparts, when so executed and delivered, shall be deemed to be an original and all of which counterparts, taken together, shall constitute but one and the same Agreement and it shall not be necessary in making proof of this Agreement to produce more than one such counterpart or counterparts bearing the signatures of all of the parties thereto.

11.9   Binding Effect; Assignment; Addition and Substitution of Lenders.

(a)     This Agreement shall be binding upon, and inure to the benefit of, Borrower, Agent, the Lenders, all future holders of the Notes and their respective successors and assigns; provided, however, that Borrower may not assign its rights or obligations hereunder or in connection herewith or any interest herein (voluntarily, by operation of law or otherwise) without the prior written consent of Agent and all of the Lenders.

(b)     Each Lender may at any time sell to one or more banks or other entities ("Participants") participating interests in all or any portion of its Revolving Commitment and Loans or participation in Letters of Credit or any other interest of such Lender hereunder (in respect of any Lender, its "Credit Exposure").  In the event of any such sale by a Lender of participating interests to a Participant, such Lender's obligations under this Agreement shall remain unchanged, such Lender shall remain solely responsible for the performance thereof, and Borrower and Agent shall continue to deal solely and directly with such Lender in connection with such Lender's rights and obligations under this Agreement.  Borrower agrees that if amounts outstanding under this Agreement or any of the Loan Documents are due or 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 deemed to have the right of setoff in respect of its participating interest in amounts owing under this Agreement and the Loan Documents to the same extent as if the amount of its participating interest were owing directly to it as a Lender under this Agreement or any other Loan Document, provided, however,  that such right of setoff shall be subject to the obligation of such Participant to share with the Lenders, and the Lenders agree to share with such Participant, as provided in Section 11.7.  Borrower also agrees that each Participant shall be entitled to the benefits of Sections 3.5, 3.6 and 4.6 with respect to its participation in the Loans outstanding from time to time.  Each Lender agrees that any agreement between such Lender and any such Participant in respect of such participating interest shall not restrict such Lender's right to approve or agree to any amendment, change, supplement waiver of, discharge or termination to any of the provisions of this Agreement or any of the Loan Documents except to the extent that any of the forgoing would (i) extend the final scheduled maturity of any Loan or Note in which such Participant is participating beyond the Termination Date, or reduce the rate or extend the time of payment of interest or fees on any such Loan or Note (except in connection with a waiver of applicability of any post‑default increase in interest rates) or reduce the principal amount thereof, or increase the amount of the participant's participation over the amount thereof then in effect (it being understood that waivers or modifications of conditions precedent, covenants, Events of Default or Unmatured Events of Default or of a mandatory reduction in Commitments shall not constitute a change in the terms of such participation, and that an increase in any Revolving Commitment or Loan shall be permitted without the consent of any Participant if the Participant's participation is not increased as a result thereof), (ii) consent to the assignment or transfer by Borrower of any of its rights and obligations under this Agreement or (iii) release all or substantially all of the Collateral under all of the Security Documents (except as expressly provided in the Loan Documents) supporting the Loans and/or Letters of Credit hereunder in which such Participant is participating.

(c)     Any Lender may at any time assign to one or more Eligible Assignees, including an Affiliate thereof (each an "Assignee"), all or any part of its Credit Exposure pursuant to an Assignment and Assumption Agreement, provided that (i) it assigns its Credit Exposure in an amount not less than $5,000,000 (or if less the entire amount of Lender's Credit Exposure) and (ii) any assignment of all or any portion of any Lender's Credit Exposure to an Assignee other than another Lender shall require the prior written consent of Agent and, so long as no Unmatured Event of Default or Event of Default has occurred and is continuing, Borrower (the consent of Borrower and Agent not to be unreasonably withheld or delayed), and provided further, that notwithstanding the foregoing limitations, any Lender may at any time assign all or any part of its Credit Exposure to any Affiliate of such Lender or to any other Lender.  Upon execution of an Assignment and Assumption Agreement and the payment of a nonrefundable assignment fee of $3,500 in immediately available funds to Agent at its Payment Office in connection with each such assignment, written notice thereof by such transferor Lender to Agent and the recording by Agent of such assignment and the resulting effect upon the Loans and Revolving Commitment of the assigning Lender and the Assignee, the Assignee shall have, to the extent of such assignment, the same rights and benefits as it would have if it were a Lender hereunder and the holder of the Obligations (provided that Borrower and Agent shall be entitled to continue to deal solely and directly with the assignor Lender in connection with the interests so assigned to the Assignee until written notice of such assignment, together with payment instructions, addresses and related information with respect to the Assignee, shall have been given to Borrower and Agent by the assignor Lender and the Assignee) and, if the Assignee has expressly assumed, for the benefit of Borrower, some or all of the transferor Lender's obligations hereunder, such transferor Lender shall be relieved of its obligations hereunder to the extent of such assignment and assumption, and except as described above, no further consent or action by Borrower, the Lenders or Agent shall be required.  At the time of each assignment pursuant to this Section 11.9(c) to a Person which is not already a Lender hereunder and which is not a United States person (as such term is defined in Section 7701(a)(30) of the Code) United States Federal income tax purposes, the respective Assignee shall provide to Borrower and Agent the appropriate IRS Forms (and, if applicable a Section 4.6(d)(ii) Certificate) described in Section 4.6(d).  Each Assignee shall take such Credit Exposure subject to the provisions of this Agreement and to any request made, waiver or consent given or other action taken hereunder, prior to the receipt by Agent and Borrower of written notice of such transfer, by each previous holder of such Credit Exposure.  Such Assignment and Assumption Agreement shall be deemed to amend this Agreement and Schedule 2.1(a)(ii) and 2.1(b) hereto, to  the extent, and only to the extent, necessary to reflect the addition of such Assignee as a Lender and the resulting adjustment of all or a portion of the rights and obligations of such transferor Lender under this Agreement, the Revolving Commitment, the determination of its Commitment Percentage (rounded to twelve decimal places), the Loans and any new Notes to be issued, at Borrower's expense, to  such Assignee, and no further consent or action by Borrower or the Lenders shall be required to effect such amendments.

(d)     Borrower authorizes each Lender to disclose to any Participant or Assignee (each, a "Transferee") and any prospective Transferee any and all financial information in such Lender's possession concerning Borrower and any Subsidiary of Borrower which has been delivered to such Lender by Borrower pursuant to this Agreement or which has been delivered to such Lender by Borrower in connection with such Lender's credit evaluation of Borrower prior to entering into this Agreement; provided that such Transferee or prospective Transferee agrees in writing to treat any such information which is not public as confidential.

(e)     Notwithstanding any other provision set forth in this Agreement, any Lender may at any time pledge or assign all or any portion of its rights under this Agreement and the other Loan Documents (including, without limitation, the Notes held by it) to any Federal Reserve Bank in accordance with Regulation A of the Federal Reserve Board without notice to, or the consent of, Borrower.  No such pledge or assignment shall release the transferor Lender from its obligations hereunder.

11.10  CONSENT TO JURISDICTION; MUTUAL WAIVER OR JURY TRIAL.

(A)    ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK, AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH PARTY HEREBY IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID COURTS.  EACH PARTY HEREBY IRREVOCABLY DESIGNATES, APPOINTS AND EMPOWERS CT CORPORATION SYSTEM WITH OFFICES ON THE DATE HEREOF AT 1633 BROADWAY, NEW YORK, NEW YORK 10019 AS ITS DESIGNEE, APPOINTEE AND AGENT TO RECEIVE, ACCEPT AND ACKNOWLEDGE FOR AND ON ITS BEHALF, AND IN RESPECT OF ITS PROPERTY, SERVICE OF ANY AND ALL LEGAL PROCESS, SUMMONS, NOTICES AND DOCUMENTS WHICH MAY BE SERVED IN ANY SUCH ACTION OR PROCEEDING.  IF FOR ANY REASON SUCH DESIGNEE, APPOINTEE AND AGENT SHALL CEASE TO BE AVAILABLE TO ACT AS SUCH, THEN SUCH PARTY SHALL DESIGNATE A NEW DESIGNEE, APPOINTEE AND AGENT IN NEW YORK CITY ON THE TERMS AND FOR THE PURPOSES OF THIS PROVISION SATISFACTORY TO AGENT UNDER THIS AGREEMENT.  EACH PARTY FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO SUCH PARTY, AT ITS ADDRESS SET FORTH OPPOSITE ITS SIGNATURE BELOW.  NOTHING HEREIN SHALL AFFECT THE RIGHT OF ANY PARTY UNDER THIS AGREEMENT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST ANY PARTY IN ANY OTHER JURISDICTION.

(B)    EACH PARTY HEREBY IRREVOCABLY WAIVES ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF THE AFORESAID ACTIONS OR PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT BROUGHT IN THE COURTS REFERRED TO IN CLAUSE (A) ABOVE AND HEREBY FURTHER IRREVOCABLY WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.

(C)    EACH OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE TO TRIAL BY JURY IN ANY COURT OR JURISDICTION, INCLUDING WITHOUT LIMITATION THOSE REFERRED TO IN CLAUSE (A) ABOVE, IN RESPECT TO ANY MATTER ARISING OUT OF OR RELATING TO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.

11.11  Governing Law.  THIS AGREEMENT AND EACH NOTE SHALL BE DEEMED TO BE A CONTRACT MADE UNDER THE INTERNAL LAWS OF THE STATE OF NEW YORK, AND FOR ALL PURPOSES SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH SUCH LAWS OF SAID STATE, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.

11.12  Registry.  Borrower hereby designates Agent to serve as Borrower's agent, solely for purposes of this Section 11.12 to maintain a register (the "Register") on which it will record the Commitment from time to time of each of the Lenders, the Loans made by each of the Lenders and each repayment in respect of the principal amount of the Loans of each Lender.  Failure to make any such recordation, or any error in such recordation shall not affect Borrower's obligations in respect of such Loans.  With respect to any Lender, the transfer of the Commitments of such Lender and the rights to the principal of, and interest on, any Loan made pursuant to such Commitment shall not be effective until such transfer is recorded on the Register maintained by Agent with respect to ownership of such Commitment and Loans and prior to such recordation all amounts owing to the transferor with respect to such Commitments and Loans shall remain owing to the transferor.  The registration of assignment or transfer of all or part of any Commitment and Loans shall be recorded by Agent on the Register only upon the acceptance by Agent of a properly executed and delivered Assignment and Assumption Agreement pursuant to Section 11.9.  Coincident with the delivery of such an Assignment and Assumption Agreement to Agent for acceptance and registration of assignment or transfer of all or part of a Loan, or as soon thereafter as practicable, the assigning or transferor Lender shall surrender the Note evidencing such Loan, and thereupon one or more new Notes in the same aggregate principal amount then owing to such assignor or transferor Lender shall be issued to the assigning or transferor Lender and/or the new Lender. Borrower agrees to indemnify Agent from and against any and all losses, claims, damages and liabilities of whatsoever nature which may be imposed on, asserted against or incurred by Agent in performing its duties under this Section 11.12 except for those resulting solely from Agent's willful misconduct and/or gross negligence in the performance of such duties.

11.13  Severability of Provisions.  Any provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof or affecting the validity or enforceability of such provision in any other jurisdiction.

11.14  Headings.  The Table of Contents and article and section headings used in this Agreement are for convenience of reference only and shall not affect the construction of this Agreement.

11.15  Independent Nature of Lenders' Rights.  The amounts payable at any time under this Agreement to each Agent and each Lender shall be separate and independent debts; each Lender shall be entitled to protect and enforce its rights arising out of this Agreement; and it shall not be necessary for any Agent or any other Lender to be joined as an additional party in any proceeding for such purpose.

11.16  Survival of Representations.  Unless a longer period is provided herein, all covenants, agreements and representations in this Agreement shall survive the making by the Lenders of the Loans and the execution and delivery to Agent for the account of the Lenders of the Notes evidencing the Loans, regardless of any investigation made by any Agent or the Lenders and of the Agent's and the Lenders' access to any information, and shall continue in full force and effect until the final and indefeasible payment in full of the Notes and all of Borrower's obligations under this Agreement and the termination of the Revolving Commitments in their entirety.

11.17  Confidentiality.  Each of the Lenders severally agrees to keep confidential all non-public information pertaining to Borrower and its Subsidiaries which is provided to it by any such parties in accordance with such Lender's customary procedures for handling confidential information of this nature and in a prudent fashion, and shall not disclose such information to any Person except (i) to the extent such information is public when received by such Lender or becomes public thereafter due to the act or omission of any party other than a Lender, (ii) to the extent such information is independently obtained from a source other than Borrower or its Subsidiaries and such information from such source is not, to such Lender's knowledge, subject to an obligation of confidentiality or, if such information is subject to an obligation of confidentiality, that disclosure of such information is permitted, (iii) to an Affiliate of such Lender, counsel, auditors, examiners of any regulatory authority having jurisdiction over such Lender, accountants and other consultants retained by Agent or any Lender, (iv) in connection with any litigation or the enforcement of the rights of any Lender or Agent under this Agreement or any other Loan Document, (v) to the extent required by any applicable statute, rule or regulation or court order (including, without limitation, by way of subpoena) or pursuant to the request of any Governmental Authority having jurisdiction over any Lender or Agent; provided, however, that in such event, if the Lender(s) are able to do so, the Lender shall provide Borrower with prompt notice of such requested disclosure so that Borrower may seek a protective order or other appropriate remedy, and, in any event, the Lenders will endeavor in good faith to provide only that portion of such information which, in the reasonable judgment of the Lender(s), is relevant and legally required to be provided, or (vi) to the extent disclosure to other entities is appropriate in connection with any proposed or actual assignment or grant of a participation by any of the Lenders of interests in this Agreement and/or any of the other Loan Documents to such other financial institutions (who will in turn be required to maintain confidentiality as if they were Lenders parties to this Agreement).  In no event shall Agent or any Lender be obligated or required to return any such information or other materials furnished by Borrower.

11.18   Effectiveness.  This Agreement shall become effective on the date (the "Effective Date") on which Borrower, Agent and each of the Lenders shall have signed a counterpart of this Agreement (whether the same or different counterparts) and shall have delivered the same to the Agent at the Notice Office (or to Agent's counsel as directed by such counsel) or, in the case of the Lenders, shall have given to Agent or telephonic (confirmed in writing), written, telex or facsimile notice (actually received) at such office or the office of Agent's counsel that the same has been signed and mailed to it.  Agent will give Borrower and each Lender prompt written notice of the occurrence of the Effective Date.

11.19  Waiver of Immunities.  Subject to Section 11.10 of this Agreement, each Lender waives, in relation to any action or proceeding arising out of or relating to this Agreement or any Note, any sovereign immunity or other immunity to suit or to execution or attachment to which such Lender or any of its property may be or become entitled.

11.20  Concerning the Collateral and the Loan Documents.

(a)     Authority.  Each Lender (on its own behalf and on behalf of any Affiliate of such Lender which is a Secured Creditor) authorizes and directs DBTCA to act as collateral agent and to enter into the Loan Documents relating to the Collateral for the benefit of the Lenders and the other Secured Creditors.  Each Lender (on its own behalf and on behalf of any Affiliate of such Lender which is a Secured Creditor) agrees that any action taken by the Agent, the Collateral Agent or the Required Lenders (or, where required by the express terms, hereof, a different proportion of the Lenders) in accordance with the provisions hereof or of the other Loan Documents, and the exercise by the Agent, the Collateral Agent or the Required Lenders (or, where so required, such different proportion) of the powers set forth herein or therein, together with such other powers as are reasonably incidental thereto, shall be authorized and binding upon all of the Lenders and the other Secured Creditors. Without limiting the generality of the foregoing, the Agent and the Collateral Agent shall have the sole and exclusive right and authority to (i) act as the disbursing and collecting agent for the Lenders and the other Secured Creditors with respect to all payments and collections arising in connection herewith and with the Loan Documents relating to the Collateral; (ii) execute and deliver each Loan Document relating to the Collateral and accept delivery of each such agreement delivered by any Credit Party, (iii) act as collateral agent for the Lenders and the other Secured Creditors for purposes stated in the Loan Documents to the extent such perfection is required under the Loan Documents, provided, however, the Agent and the Collateral Agent hereby appoints, authorizes and directs each Lender and the other Secured Creditors to act as collateral sub-agent for the Agent, the Collateral Agent and the Lenders for purposes of the perfection of all security interests and Liens with respect to each Credit Party's respective deposit accounts maintained with, and cash and Cash Equivalents held by, such Lender or such other Secured Creditor; (iv) manage, supervise and otherwise deal with the Collateral; (v) take such action as is necessary or desirable to maintain the perfection and priority of the security interests and liens created or purported to be created by the Loan Documents, and (vi) except as may be otherwise specifically restricted by the terms hereof or of any other Loan Document, exercise all remedies given to the Agent or the Lenders with respect to the Collateral under the Loan Documents relating thereto, applicable law or otherwise.

(b)     Release of Collateral.  

(i)     The Agent and each Lender (on its own behalf and on behalf of any Affiliate of such Lender that is a Secured Creditor) hereby directs the Agent and the Collateral Agent to release, in accordance with the terms hereof, any Lien held by the Agent or the Collateral Agent, under the Security Documents:

(A)    against all of the Collateral, upon final and indefeasible payment in full in cash of the Loans and Obligations and termination of all Commitments and Letters of Credit and termination hereof;

(B)    against any part of the Collateral sold or disposed of by Borrower or any of its Subsidiaries to the extent such sale or disposition is permitted hereby (or permitted pursuant to a waiver or consent of a transaction otherwise prohibited hereby);

(C)    against any Collateral acquired by Borrower or any of its Subsidiaries after the Third Amended and Restated Effective Date and at least 80% of the purchase price therefor is within 120 days of the acquisition thereof financed with Purchase Money Indebtedness secured by a Lien permitted by clause (ix) of the definition of Permitted Liens.

(D)    so long as no Unmatured Event of Default or Event of Default has occurred and is continuing, in the sole discretion of the Agent upon the request of Borrower, against any part of the Collateral with a fair market value of less than $1,000,000 in the aggregate during the term of this Agreement as such fair market value may be certified to the Agent by Borrower in an officer's certificate acceptable in form and substance to the Agent; and

(E)    against a part of the Collateral which release does not require the consent of all of the Lenders as set forth in Section 11.1(a), if such release is consented to by the Required Lenders;

provided, however, that (y) the Agent and the Collateral Agent shall not be required to execute any such document on terms which, in its opinion, would expose it to liability or create any obligation or entail any consequence other than the release of such Liens without recourse or warranty, and (z) such release shall not in any manner discharge, affect or impair the Obligations or any Liens upon (or obligations of Borrower or any of its Subsidiaries in respect of) all interests retained by Borrower and/or any of its Subsidiaries, including (without limitation) the proceeds of any sale, all of which shall continue to constitute part of the Collateral.

(ii)     Each Lender (on its own behalf and on behalf of any Affiliate of such Lender that is a Secured Creditor) hereby directs the Agent and the Collateral Agent (and the Agent and the Collateral Agent agree) to execute and deliver or file such termination and partial release statements and such other things as are necessary to release Liens to be released pursuant to this Section 11.20 promptly upon the effectiveness of any such release or enter into intercreditor agreements contemplated or permitted herein.

(c)     No Obligation.  Neither the Agent nor the Collateral Agent shall have any obligation whatsoever to any Lender or any other Secured Creditor or to any other Person to assure that the Collateral exists or is owned by any Credit Party or is cared for, protected or insured or has been encumbered or that the Liens granted to the Agent and the Collateral Agent herein or pursuant to the Loan Documents have been properly or sufficiently or lawfully created, perfected, protected or enforced or are entitled to any particular priority, 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 the Agent or the Collateral Agent in any of the Loan Documents, it being understood and agreed that in respect of the Collateral, or any act, omission or event related thereto, Agent and the Collateral Agent may act in any manner it may deem appropriate, in its sole discretion, given the Agent's and the Collateral Agent's own interests in the Collateral as one of the Lenders and that the Agent and the Collateral Agent shall not have any duty or liability whatsoever to any Lender, provided, that, notwithstanding the foregoing, the Agent and the Collateral Agent shall be responsible for its grossly negligent actions or actions constituting intentional misconduct.

      IN WITNESS WHEREOF, the parties hereto have caused this Third Amended and Restated Credit Agreement to be executed by their respective officers thereunto duly authorized, as of the date first above written.

BMC INDUSTRIES, INC.

By:  /s/ Curtis E. Petersen

Name:  Curtis E. Petersen

Title:  Senior Vice President, Finance and Administration, Chief Financial Officer

 

DEUTSCHE BANK TRUST COMPANY AMERICAS (formerly named Bankers Trust Company),
individually as a Lender and as Agent

By:  /s/ M.A. Orlando

Name:  Marco Orlando

Title:  Director

BANK ONE, NA (Main Office Chicago)
individually as a Lender and as documentation agent

By:  /s/ Henry W. Howe

Name:  Henry W. Howe

Title:  Officer

WELLS FARGO BANK MINNESOTA, NATIONAL ASSOCIATION (f/k/a Norwest Bank Minnesota, National Association)

By:  /s/ Calvin R. Emerson

Name:  Calvin R. Emerson

Title:  Vice President

HARRIS TRUST AND SAVINGS BANK

By:  /s/ George M. Oluhy

Name:  George M. Oluhy

Title:  Vice President

CREDIT AGRICOLE INDOSUEZ

By:  /s/ Larry Materi

Name:  Larry Materi

Title:  Vice President

WACHOVIA BANK, N.A.

By:  /s/ Richard E.S. Bowen

Name:  Richard E.S. Bowen

Title:  Vice President

UNION BANK OF CALIFORNIA, N.A.

By:  /s/ Jeffrey Mumm

Name:  Jeffrey Mumm

Title:  Vice President

U.S. BANK NATIONAL ASSOCIATION

By:  /s/ Nicholas G. Myers

Name:  Nicholas G. Myers

Title:  Assistant Vice President

EX-10.46 4 bmc_security-agreement.htm

TABLE OF CONTENTS

ARTICLE I SECURITY INTERESTS			5
	1.1	Grant of Security Interests	5
	1.2	Power of Attorney	5
ARTICLE II GENERAL REPRESENTATIONS, WARRANTIES AND COVENANTS			6
	2.1	Chief Executive Office/Inventory and Equipment Locations	6
	2.2	State of Incorporation	6
	2.3	Trade Names; CHANGE OF NAME	7
ARTICLE III PROVISIONS CONCERNING ALL COLLATERAL			7
	3.1	Protection of Administrative Agent's Security	7
	3.2	Warehouse Receipts Non-Negotiable; THIRD-PARTY ACKNOWLEDGMENTS	7
	3.3	Further Actions	8
	3.4	Financing Statements	8
ARTICLE IV REMEDIES UPON OCCURRENCE OF EVENT OF DEFAULT			8
	4.1	Remedies; Obtaining the Collateral Upon Default	8
	4.2	Remedies; Disposition of the Collateral	9
	4.3	Waiver of Claims	10
	4.4	Application of Proceeds	11
	4.5	Remedies Cumulative	13
	4.6	Discontinuance of Proceedings	13
ARTICLE V INDEMNITY			14
	5.1	Indemnity	14
	5.2	Indemnity Obligations Secured by Collateral; SURVIVAL	14
ARTICLE VI DEFINITIONS			15
ARTICLE VII MISCELLANEOUS			19
	7.1	Notices	19
	7.2	Waiver; AMENDMENT	19
	7.3	Obligations Absolute	19
	7.4	Successors and Assigns	19
	7.5	Headings Descriptive	20
	7.6	Severability	20
	7.7	GOVERNING LAW	20
	7.8	Borrower's Duties	20
	7.9	Termination; RELEASE	20
	7.10	Counterparts	21
	7.11	The Administrative Agent	21
ARTICLE VIII SPECIAL PROVISIONS CONCERNING ACCOUNTS;  CONTRACT RIGHTS;  INSTRUMENTS			22
	8.1	Additional Representations and Warranties	22
	8.2	Maintenance of Records	22
	8.3	Modification of Terms; ETC	23
	8.4	Collection	23
	8.5	Instruments	23
	8.6	Further Actions	23
ARTICLE IX SPECIAL PROVISIONS CONCERNING MARKS			24
	9.1	Additional Representations and Warranties	24
	9.2	Licenses and Assignments	24
	9.3	Infringements	24
	9.4	Preservation of Marks	24
	9.5	Maintenance of Registration	24
	9.6	Future Registered Marks	25
	9.7	Remedies	25
ARTICLE X SPECIAL PROVISIONS CONCERNING PATENTS AND COPYRIGHTS AND TRADE SECRETS			25
	10.1	Additional Representations and Warranties	25
	10.2	Licenses and Assignments	26
	10.3	Infringements	26
	10.4	Maintenance of Patents	26
	10.5	Prosecution of Patent Application	26
	10.6	Other Patents and Copyrights	27
	10.7	Remedies	27

;

ANNEX A	Schedule of Chief Executive Offices
ANNEX B	Schedule of Inventory and Equipment Locations
ANNEX C	Schedule of Trade, Fictitious and Other Names
ANNEX D	Schedule of Marks
ANNEX E	Schedule of License Agreements and Assignments
ANNEX F	Schedule of Patents and Copyrights
ANNEX G	Schedule of Copyrights and Applications
ANNEX H	Assignment of Security Interest in U.S. Trademarks and Patents
ANNEX I	Assignment of Security Interest in U.S. Copyrights

AMENDED AND RESTATED

SECURITY AGREEMENT

between

BMC INDUSTRIES, INC.,

DEUTSCHE BANK TRUST COMPANY AMERICAS
(formerly named Bankers Trust Company),
as Administrative Agent

and

U.S. BANK NATIONAL ASSOCIATION

Dated as of September 27, 2002

AMENDED AND RESTATED SECURITY AGREEMENT

THIS AMENDED AND RESTATED SECURITY AGREEMENT, dated as of September 27, 2002, is between BMC INDUSTRIES, INC., a Minnesota corporation ("Borrower"), DEUTSCHE BANK TRUST COMPANY AMERICAS (formerly named Bankers Trust Company), as administrative agent (the "Administrative Agent") and U.S. BANK NATIONAL ASSOCIATION ("US Bank") for the benefit of (i) the Lenders and the Agent under the Credit Agreement hereinafter referred to (such Lenders and the Agent are hereinafter called the "Bank Creditors"), (ii) if one or more Lenders (or any Affiliate thereof) enter into one or more (A) interest rate protection agreements (including, without limitation, interest rate swaps, caps, floors, collars and similar agreements), (B) foreign exchange contracts, currency swap agreements or other similar agreements or arrangements designed to protect against the fluctuations in currency values and/or (C) other types of hedging agreements from time to time (collectively, the "Interest Rate Protection or Other Hedging Agreements") with, or guaranteed by, Borrower, any such Lender or Lenders or any Affiliate of such Lender or Lenders (even if the respective Lender subsequently ceases to be a Lender under the Credit Agreement for any reason) so long as any such Lender or Affiliate participates in the extension of such Interest Rate Protection or Other Hedging Agreements and their subsequent assigns, if any (collectively, the "Other Creditors") and (iii) US Bank as lender under the US Bank Letter of Credit Facility (as defined below) (the "LC Creditor" and, together with the Other Creditors and the Bank Creditors, hereinafter called the "Secured Creditors").  Except as otherwise defined herein, terms used herein and defined in the Credit Agreement (as hereinafter defined) shall be used herein as so defined.

W I T N E S S E T H :

WHEREAS, Borrower, the financial institutions (the "Lenders") from time to time party thereto and Bankers Trust Company, as Administrative Agent (together with any successor agent, the "Agent"), have entered into an Amended and Restated Credit Agreement, dated as of June 25, 1998, providing for the making of Loans and the issuance of, and participation in, Letters of Credit as contemplated therein (as used herein, the term "Credit Agreement" means the Credit Agreement described above in this paragraph, as in effect on the date hereof and as amended by that certain Second Amendment and Restatement Agreement dated as of October 12, 2001 and as amended and restated by that certain Third Amended and Restated Credit Agreement dated as of the date hereof, as the same may be amended, modified, extended, renewed, replaced, restated or supplemented from time to time, and including any agreement extending the maturity of or restructuring of all or any portion of the Indebtedness under such agreement or any successor agreements);

WHEREAS, Borrower may at any time and from time to time enter into, or guarantee, one or more Interest Rate Protection or Other Hedging Agreements with one or more Other Creditors;

WHEREAS, Borrower, Administrative Agent and US Bank previously entered into a Security Agreement dated as of October 12, 2001 (the "Original Security Agreement");

WHEREAS, it is a condition precedent to each of the above-described extensions of credit that Borrower shall have executed and delivered this Agreement which shall amend and restate the Original Security Agreement in its entirety; and

WHEREAS, Borrower desires to enter into this Agreement in order to satisfy the condition described in the preceding paragraph;

NOW, THEREFORE, in consideration of the extensions of credit to be made to Borrower and other benefits accruing to Borrower, the receipt and sufficiency of which are hereby acknowledged, Borrower hereby makes the following representations and warranties to the Administrative Agent for the benefit of the Secured Creditors and hereby covenants and agrees with the Administrative Agent for the benefit of the Secured Creditors as follows:

ARTICLE I
SECURITY INTERESTS

1.1              Grant of Security Interests.  (a)  As security for the prompt and complete payment and performance when due of all of the Obligations, Borrower does hereby pledge and grant to the Administrative Agent for the benefit of the Secured Creditors, a continuing security interest of first priority (subject to Liens evidenced by Permitted Filings and other Permitted Liens) in, all of the right, title and interest of Borrower in, to and under all of the following, whether now existing or hereafter from time to time acquired:  (i) each and every Account, (ii) all Contracts, together with all Contract Rights arising thereunder, (iii) all Inventory, (iv) all Equipment, (v) all Marks, together with the registrations and right to all renewals thereof, and the goodwill of the business of Borrower symbolized by the Marks, (vi) all Patents and Copyrights, and all reissues, renewals or extensions thereof, (vii) all computer programs of Borrower and all intellectual property rights therein and all other proprietary information of Borrower, including, but not limited to, Trade Secrets, (viii) all other Goods, General Intangibles, Chattel Paper, Documents, Investment Property and Instruments, (ix) Letter of Credit Rights, (x) Deposit Accounts, (xi) all cash, accounts, deposits and insurance policies now or at any time hereafter in the possession or under control of Borrower or its respective bailees and any interest therein, (xii) all vehicles, aircraft, vessels, barges, railcars, rolling stock and fixtures owned by the Borrower, together with accessions thereto and replacement parts therefor, and (xiii) all Proceeds and products of any and all of the foregoing (all of the above, collectively, the "Collateral").

(b)  The security interests of the Administrative Agent under this Agreement extend to all Collateral of the kind which is the subject of this Agreement which Borrower may acquire at any time during the continuation of this Agreement.

1.2              Power of Attorney.  Borrower hereby constitutes and appoints the Administrative Agent its true and lawful attorney, with full power after the occurrence of and during the continuance of an Event of Default (in the name of Borrower or otherwise), in the Administrative Agent's reasonable discretion, to take any action and to execute any instrument required by this Agreement if Borrower has failed to do so after demand by the Administrative Agent.

ARTICLE II
GENERAL REPRESENTATIONS, WARRANTIES AND COVENANTS

Borrower represents, warrants and covenants, which representations, warranties and covenants shall survive execution and delivery of this Agreement, as follows:

2.1              Chief Executive Office/Inventory and Equipment Locations.  The chief executive office of Borrower is located at the address indicated on Annex A hereto.  All Inventory and Equipment held on the date hereof by Borrower is located at one of the locations shown on Annex B hereto (other than (i) immaterial portions of Inventory or Equipment or (ii) Equipment out for repair).    Prior to January 1, 2002, the Borrower shall not (x) move its chief executive office to any of the States of Mississippi, Alabama or Florida, or (y) move any Inventory or Equipment to any of the States of Mississippi, Alabama or Florida until (i) it shall have given to the Administrative Agent not less than 30 days' prior written notice of its intention to do so, (ii) with respect to such move, it shall have taken all action, reasonably satisfactory to the Administrative Agent, to maintain the security interest of the Administrative Agent in the Collateral intended to be granted and perfected under the Uniform Commercial Code hereby at all times fully perfected and in full force and effect, (iii) at the reasonable request of the Administrative Agent, it shall have furnished a customary opinion of counsel reasonably acceptable to the Administrative Agent to the effect that all financing or continuation statements and amendments or supplements thereto have been filed in the appropriate filing office or offices, and all other actions (including, without limitation, the payment of all filing fees and taxes, if any, payable in connection with such filings) have been taken, in order to perfect (and maintain the perfection and priority of) the security interest granted hereby and (iv) the Administrative Agent shall have received evidence that all other actions (including, without limitation, the payment of all filing fees and taxes, if any, payable in connection with such filings) have been taken, in order to perfect (and maintain the perfection and priority of) the security interest granted hereby.

2.2              State of Incorporation.  The state of incorporation of Borrower is indicated on Annex A hereto.  Borrower will not change its state of incorporation except as in accordance with the last sentence of this Section 2.2.  Borrower shall not establish a new state of incorporation until (i) it shall have given to the Administrative Agent not less than 30 days' prior written notice of its intention to do so, clearly describing such new state of incorporation and providing such other information in connection therewith as the Administrative Agent may reasonably request, (ii) with respect to such new state of incorporation, it shall have taken all action, reasonably satisfactory to the Administrative Agent, to maintain the security interest of the Administrative Agent in the Collateral intended to be granted and perfected under the Uniform Commercial Code hereby at all times fully perfected and in full force and effect, (iii) at the reasonable request of the Administrative Agent, it shall have furnished a customary opinion of counsel reasonably acceptable to the Administrative Agent to the effect that all financing or continuation statements and amendments or supplements thereto have been filed in the appropriate filing office or offices, and all other actions (including, without limitation, the payment of all filing fees and taxes, if any, payable in connection with such filings) have been taken, in order to perfect (and maintain the perfection and priority of) the security interest granted hereby and (iv) the Administrative Agent shall have received evidence that all other actions (including, without limitation, the payment of all filing fees and taxes, if any, payable in connection with such filings have been taken, in order to perfect (and maintain the perfection and priority of) the security interest granted hereby.

2.3              Trade Names; Change of Name.  Borrower does not have and has not operated in any jurisdiction under, or in the preceding 12 months has not had nor has operated in any jurisdiction under, any trade names, fictitious names or other names (including, without limitation, any names of divisions or operations) except its legal name and such other trade, fictitious or other names as are listed on Annex C hereto.  The corporation identification number or other applicable formation identification number shall be set forth across from the exact legal name of Borrower identified in Annex C.  Borrower shall not change its legal name or assume or operate in any jurisdiction under any trade, fictitious or other name in any manner which might make any financing statement or continuation statement filed in connection therewith seriously misleading except those names listed on Annex C hereto and new names (including, without limitation, any names of divisions or operations) established in accordance with the last sentence of this Section 2.3.  Borrower shall not assume or operate in any jurisdiction under any new trade, fictitious or other name that would make any financing statement or continuation statement filed in connection therewith, seriously misleading until (i) it shall have given to the Administrative Agent not less than 30 days' prior written notice of its intention so to do, clearly describing such new name and the jurisdictions in which such new name shall be used and providing such other information in connection therewith as the Administrative Agent may reasonably request, (ii) with respect to such new name, it shall have taken all action to maintain the security interest of the Administrative Agent in the Collateral intended to be granted hereby at all times fully perfected and in full force and effect, (iii) at the reasonable request of the Administrative Agent, it shall have furnished a customary opinion of counsel reasonablyacceptable to the Administrative Agent to the effect that all financing or continuation statements and amendments or supplements thereto have been filed in the appropriate filing office or offices, and (iv) the Administrative Agent shall have received evidence that all other actions (including, without limitation, the payment of all filing fees and taxes, if any, payable in connection with such filings) have been taken, in order to perfect (and maintain the perfection and priority of) the security interest granted hereby.

ARTICLE III
PROVISIONS CONCERNING ALL COLLATERAL

3.1              Protection of Administrative Agent's Security.  Borrower will do nothing to impair the rights of the Administrative Agent in the Collateral other than dispositions, the creation of Liens and other encumbrances and other actions permitted hereunder and under the Credit Agreement and other Loan Documents.  

3.2              Warehouse Receipts Non-Negotiable; Third-Party Acknowledgments.  Borrower agrees that if any warehouse receipt or receipt in the nature of a warehouse receipt is issued with respect to any of its Inventory, such warehouse receipt or receipt in the nature thereof shall not be "negotiable" (as such term is used in Section 7-104 of the Uniform Commercial Code as in effect in any relevant jurisdiction or under other relevant law).  Where Collateral with a fair market value of greater than $100,000 is in the possession of a third party, Borrower will promptly notify Administrative Agent of the occurrence of any such fact and will join with the Administrative Agent in notifying the third party of the Administrative Agent's security interest and obtaining an acknowledgment from the third party that it is holding the Collateral for the benefit of the Administrative Agent.

3.3              Further Actions.  Borrower will, at its own expense, make, execute, endorse, acknowledge, file and/or deliver to the Administrative Agent from time to time such lists, descriptions and designations of its Collateral, warehouse receipts, receipts in the nature of warehouse receipts, bills of lading, documents of title, vouchers, invoices, schedules, confirmatory assignments, conveyances, financing statements, transfer endorsements, powers of attorney, certificates, reports and other assurances or instruments and take such further steps relating to the Collateral and other property or rights covered by the security interest hereby granted, which the Administrative Agent deems reasonably appropriate or advisable to perfect, preserve or protect its security interest in the Collateral.  

3.4              Financing Statements.  Borrower agrees to deliver to the Administrative Agent such financing statements, in form reasonably acceptable to the Administrative Agent, as the Administrative Agent may from time to time reasonably request or as are reasonably  necessary (or desirable in the reasonable opinion of the Administrative Agent) to establish and maintain a valid, enforceable, first priority perfected security interest (subject only to Permitted Liens) in the Collateral as provided herein and the other rights and security contemplated hereby all in accordance with the Uniform Commercial Code as enacted in any and all relevant jurisdictions or any other relevant law.  Borrower will pay any applicable filing fees, recordation taxes and related expenses relating to its Collateral.  Borrower hereby authorizes the Administrative Agent to file any such Uniform Commercial Code financing statements without the signature of Borrower where permitted by law.

ARTICLE IV
REMEDIES UPON OCCURRENCE OF EVENT OF DEFAULT

4.1              Remedies; Obtaining the Collateral Upon Default.  Borrower agrees that, if any Event of Default shall have occurred and be continuing, then and in every such case, subject to any mandatory requirements of applicable law then in effect, the Administrative Agent, in addition to any rights now or hereafter existing under applicable law, shall have all rights as a secured creditor under the Uniform Commercial Code in all relevant jurisdictions and may:

(a)        personally, or by agents or attorneys, immediately take possession of the Collateral or any part thereof, from Borrower or any other Person who then has possession of any part thereof with or without notice or process of law, and for that purpose may enter upon Borrower's premises where any of the Collateral is located and remove the same and use in connection with such removal any and all services, supplies, aids and other facilities of Borrower; and

(b)        instruct the obligor or obligors on any agreement, instrument or other obligation (including, without limitation, the Accounts and the Contracts) constituting the Collateral to make any payment required by the terms of such agreement, instrument or other obligation directly to the Administrative Agent and may exercise any and all remedies of Borrower in respect of such Collateral; and

(c)       sell, assign or otherwise liquidate, or direct Borrower to sell, assign or otherwise liquidate, any or all of the Collateral or any part thereof, and take possession of the proceeds of any such sale or liquidation; and

(d)        take possession of the Collateral or any part thereof, by directing Borrower in writing to deliver the same to the Administrative Agent at any place or places reasonably designated by the Administrative Agent, in which event Borrower shall at its own expense:

(i)         forthwith cause the same to be moved to the place or places so designated by the Administrative Agent and there delivered to the Administrative Agent, and

(ii)        store and keep any Collateral so delivered to the Administrative Agent at such place or places pending further action by the Administrative Agent as provided in Section 6.2 hereof, and

(iii)       while the Collateral shall be so stored and kept, provide such guards and maintenance services as shall be necessary to protect the same and to preserve and maintain them in good condition; and

(e)        license or sublicense (to the extent not in violation of the license), whether on an exclusive or nonexclusive basis, any Marks (together with associated goodwill), Patents or Copyrights included in the Collateral for such term and on such conditions and in such manner as the Administrative Agent shall in its sole judgment determine (taking into account such provisions as may be necessary to protect and preserve such Marks, Patents or Copyrights); and

it being understood that Borrower's obligation so to deliver the Collateral is of the essence of this Agreement and that, accordingly, upon application to a court of equity having jurisdiction, the Administrative Agent shall be entitled to seek a decree requiring specific performance by Borrower of said obligation.

4.2              Remedies; Disposition of the Collateral.  If an Event of Default shall have occurred and be continuing, then any Collateral repossessed by the Administrative Agent under or pursuant to Section 4.1 hereof and any other Collateral whether or not so repossessed by the Administrative Agent, may be sold, assigned, leased or otherwise disposed of under one or more contracts or as an entirety, and without the necessity of gathering at the place of sale the property to be sold, and in general in such manner, at such time or times, at such place or places and on such terms as the Administrative Agent may, in compliance with any mandatory requirements of applicable law, determine to be commercially reasonable.  Any of the Collateral may be so sold, leased or otherwise disposed of, in the condition in which the same existed when taken by the Administrative Agent or after any overhaul or repair at the expense of Borrower which the Administrative Agent shall determine to be commercially reasonable.  Any such disposition which shall be a private sale or other private proceedings permitted by such requirements shall be made upon not less than 10 days' written notice to Borrower specifying the time at which such disposition is to be made and the intended sale price or other consideration therefor, and shall be subject, for the 10 days after the giving of such notice, to the right of Borrower or any nominee of Borrower to acquire the Collateral involved at a price or for such other consideration at least equal to the intended sale price or other consideration so specified.  Any such disposition which shall be a public sale permitted by such requirements shall be made upon not less than 10 days' written notice to Borrower specifying the time and place of such sale and, in the absence of applicable requirements of law, shall be by public auction (which may, at the Administrative Agent's option, be subject to reserve), after publication of notice of such auction not less than 10 days prior thereto in two newspapers in general circulation in the City of New York or in such other locations as may be necessary in order for the sale to be "commercially reasonable" (as such term is used in Article 9 Part V of the New York Uniform Commercial Code).  To the extent permitted by any such requirement of law, the Administrative Agent and the Secured Creditors may bid for and become the purchaser of the Collateral or any item thereof, offered for sale in accordance with this Section without accountability to Borrower.  If, under mandatory requirements of applicable law, the Administrative Agent shall be required to make disposition of the Collateral within a period of time which does not permit the giving of notice to Borrower as hereinabove specified, the Administrative Agent need give Borrower only such notice of disposition as shall be reasonably practicable in view of such mandatory requirements of applicable law.  Borrower agrees to do or cause to be done all such other acts and things as may be reasonably necessary to make such sale or sales of all or any portion of the Collateral valid and binding and in compliance with any and all applicable laws, regulations, orders, writs, injunctions, decrees or awards of any and all courts, arbitrators or governmental instrumentalities, domestic or foreign, having jurisdiction over any such sale or sales, all at Borrower's expense.

4.3              Waiver of Claims.  Except as otherwise provided in this Agreement, BORROWER HEREBY WAIVES, TO THE EXTENT PERMITTED BY APPLICABLE LAW, NOTICE AND JUDICIAL HEARING IN CONNECTION WITH THE ADMINISTRATIVE AGENT'S TAKING POSSESSION OR THE ADMINISTRATIVE AGENT'S DISPOSITION OF ANY OF THE COLLATERAL, INCLUDING, WITHOUT LIMITATION, ANY AND ALL PRIOR NOTICE AND HEARING FOR ANY PREJUDGMENT REMEDY OR REMEDIES AND ANY SUCH RIGHT WHICH BORROWER WOULD OTHERWISE HAVE UNDER THE CONSTITUTION OR ANY STATUTE OF THE UNITED STATES OR OF ANY STATE, and Borrower hereby further waives, to the extent permitted by law:

(a)        all damages occasioned by such taking of possession except any damages which are the direct result of the Administrative Agent's gross negligence or willful misconduct;

(b)        all other requirements as to the time, place and terms of sale or other requirements with respect to the enforcement of the Administrative Agent's rights hereunder; and

(c)        all rights of redemption, appraisement, valuation, stay, extension or moratorium now or hereafter in force under any applicable law in order to prevent or delay the enforcement of this Agreement or the absolute sale of the Collateral or any portion thereof, and Borrower, for itself and all who may claim under it, insofar as it or they now or hereafter lawfully may, hereby waives the benefit of all such laws.

Any sale of, or the grant of options to purchase, or any other realization upon, any Collateral shall operate to divest all right, title, interest, claim and demand, either at law or in equity, of Borrower therein and thereto, and shall be a perpetual bar both at law and in equity against Borrower and against any and all Persons claiming or attempting to claim the Collateral so sold, optioned or realized upon, or any part thereof, from, through and under Borrower.

4.4              Application of Proceeds.  (a)  All moneys collected by the Administrative Agent (or, to the extent the Pledge Agreement or any Mortgage to which Borrower is a party requires proceeds of Collateral under such agreement to be applied in accordance with the provisions of this Agreement, the Pledgee or Mortgagee under such other agreement) upon any sale or other disposition of the Collateral, together with all other moneys received by the Administrative Agent hereunder, shall be applied as follows:

(i)         first, to the payment of all amounts owing the Administrative Agent of the type    described in clauses (iii) and (iv) of the definition of "Obligations";

(ii)        second, to the extent proceeds remain after the application pursuant to the preceding clause (i), an amount equal to the outstanding Primary Obligations shall be paid to the Secured Creditors as provided in Section 4.4(e) hereof, with each Secured Creditor receiving an amount equal to such outstanding Primary Obligations or, if the proceeds are insufficient to pay in full all such Primary Obligations, its Pro Rata Share of the amount remaining to be distributed;

(iii)       third, to the extent proceeds remain after the application pursuant to the preceding clauses (i) and (ii), an amount equal to the outstanding Secondary Obligations shall be paid to the Secured Creditors as provided in Section 4.4(e), with each Secured Creditor receiving an amount equal to its outstanding Secondary Obligations or, if the proceeds are insufficient to pay in full all such Secondary Obligations, its Pro Rata Share of the amount remaining to be distributed; and

(iv)       fourth, to the extent proceeds remain after the application pursuant to the preceding clauses (i) through (iii), inclusive, and following the termination of this Agreement pursuant to Section 7.9(a) hereof, to Borrower or to whomever may be lawfully entitled to receive such surplus.

(b)        For purposes of this Agreement (i) "Pro Rata Share" shall mean, when calculating a Secured Creditor's portion of any distribution or amount, that amount (expressed as a percentage) equal to a fraction the numerator of which is the then unpaid amount of such Secured Creditor's Primary Obligations or Secondary Obligations, as the case may be, and the denominator of which is the then outstanding amount of all Primary Obligations or Secondary Obligations, as the case may be, (ii) "Primary Obligations" shall mean (A) in the case of the Credit Agreement Obligations, all principal of, and interest on, all Loans, all Unpaid Drawings theretofore made (together with all interest accrued thereon), and the aggregate Stated Amounts of all Letters of Credit issued (or deemed issued) under the Credit Agreement, and all Fees and (B) in the case of the Other Obligations, all amounts due under the Interest Rate Protection or Other Hedging Agreements (other than indemnities, fees (including, without limitation, attorneys' fees) and similar obligations and liabilities) and (iii) "Secondary Obligations" shall mean all Obligations other than Primary Obligations.

(c)        When payments to Secured Creditors are based upon their respective Pro Rata Shares, the amounts received by such Secured Creditors hereunder shall be applied (for purposes of making determinations under this Section 4.4 only) (i) first, to their Primary Obligations and (ii) second, to their Secondary Obligations.  If any payment to any Secured Creditor of its Pro Rata Share of any distribution would result in overpayment to such Secured Creditor, such excess amount shall instead be distributed in respect of the unpaid Primary Obligations or Secondary Obligations, as the case may be, of the other Secured Creditors, with each Secured Creditor whose Primary Obligations or Secondary Obligations, as the case may be, have not been paid in full to receive an amount equal to such excess amount multiplied by a fraction the numerator of which is the unpaid Primary Obligations or Secondary Obligations, as the case may be, of such Secured Creditor and the denominator of which is the unpaid Primary Obligations or Secondary Obligations, as the case may be, of all Secured Creditors entitled to such distribution.

(d)        Each of the Secured Creditors agrees and acknowledges that if the Bank Creditors are to receive a distribution on account of undrawn amounts with respect to Letters of Credit issued (or deemed issued) under the Credit Agreement (which shall only occur after all outstanding Loans and Unpaid Drawings with respect to such Letters of Credit have been paid in full), such amounts shall be paid to the Agent under the Credit Agreement and held by it, for the equal and ratable benefit of the Bank Creditors, as cash security for the repayment of Obligations owing to the Bank Creditors as such.  If any amounts are held as cash security pursuant to the immediately preceding sentence, then upon the termination of all outstanding Letters of Credit, and after the application of all such cash security to the repayment of all Obligations owing to the Bank Creditors after giving effect to the termination of all such Letters of Credit, if there remains any excess cash, such excess cash shall be returned by the Agent to the Administrative Agent for distribution in accordance with Section 4.4(a) hereof.

(e)        Except as set forth in Section 4.4(d) hereof, all payments required to be made hereunder shall be made (i) if to the Bank Creditors, to the Agent under the Credit Agreement for the account of the Bank Creditors, and (ii) if to the Other Creditors, to the trustee, paying agent or other similar representative (each a "Representative") for the Other Creditors or, in the absence of such a Representative, directly to the Other Creditors.

(f)         For purposes of applying payments received in accordance with this Section 4.4, the Administrative Agent shall be entitled to rely upon (i) the Agent under the Credit Agreement and (ii) the Representative for the Other Creditors or, in the absence of such a Representative, upon the Other Creditors for a determination (which the Agent, each Representative for any Secured Creditors and the Secured Creditors agree (or shall agree) to provide upon request of the Administrative Agent) of the outstanding Primary Obligations and Secondary Obligations owed to the Bank Creditors or the Other Creditors, as the case may be.  Unless it has actual knowledge (including by way of written notice from a Bank Creditor or an Other Creditor) to the contrary, the Agent and each Representative, in furnishing information pursuant to the preceding sentence, and the Administrative Agent, in acting hereunder, shall be entitled to assume that no Secondary Obligations are outstanding.  Unless it has actual knowledge (including by way of written notice from an Other Creditor) to the contrary, the Administrative Agent, in acting hereunder, shall be entitled to assume that no Interest Rate Protection or Other Hedging Agreements are in existence.

(g)        It is understood and agreed that Borrower shall remain jointly and severally liable to the extent of any deficiency between the amount of the proceeds of the Collateral hereunder and the aggregate amount of the sums referred to in clauses (i) through (iii), inclusive, of Section 4.4(a) hereof.

4.5              Remedies Cumulative.   Each and every right, power and remedy hereby specifically given to the Administrative Agent shall be in addition to every other right, power and remedy specifically given under this Agreement, the Interest Rate Protection or Other Hedging Agreements, the other Loan Documents or now or hereafter existing at law or in equity, or by statute and each and every right, power and remedy whether specifically herein given or otherwise existing may be exercised from time to time or simultaneously and as often and in such order as may be deemed expedient by the Administrative Agent.   All such rights, powers and remedies shall be cumulative and the exercise or the beginning of the exercise of one shall not be deemed a waiver of the right to exercise any other or others.   No delay or omission of the Administrative Agent in the exercise of any such right, power or remedy and no renewal or extension of any of the Obligations and no course of dealing between Borrower and the Administrative Agent or any holder of any of the Obligations shall impair any such right, power or remedy or shall be construed to be a waiver of any Default or Event of Default or an acquiescence therein.  No notice to or demand on Borrower in any case shall entitle it to any other or further notice or demand in similar or other circumstances or constitute a waiver of any of the rights of the Administrative Agent to any other or further action in any circumstances without notice or demand.   In the event that the Administrative Agent shall bring any suit to enforce any of its rights hereunder and shall be entitled to judgment, then in such suit the Administrative Agent may recover reasonable expenses, including reasonable attorneys' fees, and the amounts thereof shall be included in such judgment.

4.6              Discontinuance of Proceedings.  In case the Administrative Agent shall have instituted any proceeding to enforce any right, power or remedy under this Agreement by foreclosure, sale, entry or otherwise, and such proceeding shall have been discontinued or abandoned for any reason or shall have been determined adversely to the Administrative Agent, then and in every such case Borrower, the Administrative Agent and each holder of any of the Obligations shall be restored to their former positions and rights hereunder with respect to the Collateral subject to the security interest created under this Agreement (except to the extent of any such adverse determination), and all rights, remedies and powers of the Administrative Agent shall continue (a) as if no such proceeding had been instituted, in the case of any such proceeding so discontinued or abandoned, or (b) as if no proceeding had been instituted, except to the extent of the determination, in the case of any such proceeding so adversely determined.

ARTICLE V
INDEMNITY

5.1              Indemnity.  (a)  Borrower agrees to indemnify and hold harmless the Administrative Agent and each Secured Creditor and their respective successors, assigns, employees, agents and servants (individually an "Indemnitee," and collectively the "Indemnitees") from and against any and all claims, demands, losses, judgments and liabilities (including liabilities for penalties) of whatsoever kind or nature, and to reimburse each Indemnitee for all costs and expenses, including reasonable attorneys' fees, growing out of or resulting from this Agreement or the exercise by any Indemnitee of any right or remedy granted to it hereunder or under any Interest Rate Hedging Agreement or under any other Loan Document (but excluding any claims, demands, losses, judgments and liabilities or expenses to the extent incurred by reason of gross negligence or willful misconduct of such Indemnitee).  If and to the extent that the obligations of the Borrower under this Section 5.1(a) are unenforceable for any reason, the Borrower hereby agrees to make the maximum contribution to the payment and satisfaction of such obligations which is permissible under applicable law.

(b)        Without limiting the application of Section 5.1(a) hereof, Borrower agrees to pay, or reimburse the Administrative Agent for any and all reasonable fees, costs and expenses of whatever kind or nature incurred in connection with the creation, preservation or protection of the Administrative Agent's Liens on, and security interest in, the Collateral, including, without limitation, all reasonable fees and taxes in connection with the recording or filing of instruments and documents in public offices, payment or discharge of any taxes or Liens upon or in respect of the Collateral, premiums for insurance with respect to the Collateral and all other reasonable fees, costs and expenses in connection with protecting, maintaining or preserving the Collateral and the Administrative Agent's interest therein, whether through judicial proceedings or otherwise, or in defending or prosecuting any actions, suits or proceedings arising out of or relating to the Collateral.

(c)        Without limiting the application of Section 5.1(a) or (b) hereof, Borrower agrees to pay, indemnify and hold each Indemnitee harmless from and against any loss, costs, damages and expenses which such Indemnitee may suffer, expend or incur in consequence of or growing out of any misrepresentation by Borrower in this Agreement, any Interest Rate Protection or Other Hedging Agreement, any other Loan Document or in any writing contemplated by or made or delivered pursuant to or in connection with this Agreement, any Interest Rate Protection or Other Hedging Agreement or any other Loan Document.

(d)        If and to the extent that the obligations of Borrower under this Section 5.1 are unenforceable for any reason, Borrower hereby agrees to make the maximum contribution to the payment and satisfaction of such obligations which is permissible under applicable law.

5.2              Indemnity Obligations Secured by Collateral; Survival.  Any amounts paid by any Indemnitee as to which such Indemnitee has the right to reimbursement shall constitute Obligations secured by the Collateral prior to the release of the Collateral pursuant to the terms hereof.  The indemnity obligations of Borrower contained in this Article V shall continue in full force and effect notwithstanding the full payment of all the Notes issued under the Credit Agreement, the termination of all Interest Rate Protection or Other Hedging Agreements and the payment of all other Obligations (but excluding any unasserted contingent and indemnification obligations which survive the termination hereof) and notwithstanding the discharge thereof.

ARTICLE VI
DEFINITIONS

The following terms shall have the meanings herein specified.  Such definitions shall be equally applicable to the singular and plural forms of the terms defined.

"Account" shall have the meaning provided in the Uniform Commercial Code.

"Administrative Agent" shall have the meaning provided in the first paragraph of this Agreement.

"Agent" shall have the meaning provided in the first WHEREAS clause of this Agreement.

"Agreement" shall mean this Amended and Restated Security Agreement as the same may be modified, supplemented, extended, renewed, replaced, restated or amended from time to time in accordance with its terms.

"Bank Creditor" shall have the meaning provided in the first paragraph of this Agreement.

"Borrower" shall have the meaning provided in the first paragraph of this Agreement.

"Chattel Paper" shall have the meaning provided in the Uniform Commercial Code.

"Class" shall have the meaning provided in Section 7.2 of this Agreement.

"Collateral" shall have the meaning provided in Section 1.1(a) of this Agreement.

"Contract Rights" shall mean all rights of Borrower (including, without limitation, all rights to payment) under each Contract.

"Contracts" shall mean all contracts between Borrower and one or more additional parties (including, without limitation, (i) each partnership agreement to which Borrower is a party and (ii) any Interest Rate Protection or Other Hedging Agreements), but excluding licenses, agreements and leases, which are immaterial to the operations of Borrower, to the extent that the terms thereof prohibit the assignment of, or granting of a security interest in, such licenses, agreements or leases.

"Copyrights" shall mean any United States copyright which Borrower now owns or hereafter acquires, including any registrations of any Copyrights in the United States Copyright Office, as well as any application for a United States copyright registration now or hereafter made with the United States Copyright Office by Borrower.

"Credit Agreement" shall have the meaning provided in the first WHEREAS clause of this Agreement.

"Credit Agreement Obligations" shall have the meaning provided in the definition of "Obligations" in this Article VI.

"Default" shall mean any event which, with notice or lapse of time, or both, would constitute an Event of Default.

"Deposit Accounts" shall have the meaning provided in the Uniform Commercial Code.

"Documents" shall have the meaning provided in the Uniform Commercial Code.

"Equipment" shall mean any "equipment," as such term is defined in the Uniform Commercial Code, now or hereafter owned by Borrower.

"Event of Default" shall mean any Event of Default under, and as defined in, the Credit Agreement and shall in any event, without limitation, include any payment default on any of the Obligations after the expiration of any applicable grace period.

"General Intangibles" shall have the meaning provided in the Uniform Commercial Code.

"Goods" shall have the meaning provided in the Uniform Commercial Code.

"Indemnitee" shall have the meaning provided in Section 5.1 of this Agreement.

"Instrument" shall have the meaning provided in Article 9 of the Uniform Commercial Code.

"Interest Rate Protection or Other Hedging Agreements" shall have the meaning provided in the first paragraph of this Agreement.

"Inventory" shall mean all "inventory" as such term is defined in the Uniform Commercial Code, now or hereafter owned by Borrower.

"Investment Property" shall have the meaning ascribed thereto in Article 9 of the UCC.

"LC Creditor" shall have the meaning provided in the first WHEREAS clause of this Agreement.

"Lenders" shall have the meaning provided in the first WHEREAS clause of this Agreement.

"Letter-of-Credit Rights" shall have the meaning provided in the Uniform Commercial Code.

"Marks" shall mean all right, title and interest in and to any trademarks and service marks and trade names now held or hereafter acquired by Borrower, which are registered in the United States Patent and Trademark Office or in any similar office or agency of the United States or any state thereof or any political subdivision thereof and any application for such trademarks and service marks, as well as any unregistered marks used by Borrower in the United States and trade dress including logos, designs, trade names, company names, business names, fictitious business names and other business identifiers in connection with which any of these registered or unregistered marks are used in the United States, but excluding all intent-to-use trademark applications for which an application to allege use under 15 U.S.C. §1051(c) and/or for which a statement of use under 15 U.S.C. §1051(d) has not been filed, which applications are identified in Annex D (III).

"Obligations" shall mean (i) the full and prompt payment when due (whether at the stated maturity, by acceleration or otherwise) of all obligations (including, without limitation, all "Obligations" as such term is defined in the Credit Agreement and all obligations which, but for the automatic stay under Section 362(a) of the Bankruptcy Code, would become due) and liabilities of Borrower now existing or hereafter incurred under, arising out of or in connection with the Credit Agreement or any other Loan Document to which Borrower is a Party and the due performance and compliance by Borrower with all of the terms, conditions and agreements contained in each such Loan Document (all such obligations and liabilities being herein collectively called the "Credit Agreement Obligations"); (ii) the full and prompt payment when due (whether at the stated maturity, by acceleration or otherwise) of all obligations (including obligations which, but for the automatic stay under Section 362(a) of the Bankruptcy Code, would become due) and liabilities of Borrower now existing or hereafter incurred under, arising out of or in connection with (x) any Interest Rate Protection or Other Hedging Agreement, whether such Interest Rate Protection or Other Hedging Agreement is now in existence or hereafter arising and the due performance and compliance by Borrower with all of the terms, conditions and agreements contained therein and (y) the US Bank Letter of Credit Facility up to a maximum amount of $2,000,000 (provided that at no time shall there be more than $2,000,000 under the US Bank Letter of Credit Facility secured by the Security Documents) (all such obligations and liabilities described in this clause (ii) being herein collectively called the "Other Obligations"); (iii) any and all sums advanced by the Administrative Agent in order to preserve the Collateral or preserve its security interest in the Collateral; (iv) in the event of any proceeding for the collection or enforcement of any indebtedness, obligations, or liabilities of Borrower referred to in clauses (i) and (ii), after an Event of Default shall have occurred and be continuing, the reasonable expenses of taking, holding, preparing for sale or lease, selling or otherwise disposing of or realizing on the Collateral, or of any exercise by the Administrative Agent of its rights hereunder, together with reasonable attorneys' fees and court costs; and (v) all amounts paid by any Indemnitee as to which such Indemnitee has the right to reimbursement under Section 6.1 of this Agreement.  It is acknowledged and agreed that the "Obligations" shall include extensions of credit of the types described above, whether outstanding on the date of this Agreement or extended from time to time after the date of this Agreement.

"Other Creditors" shall have the meaning provided in the first paragraph of this Agreement.

"Other Obligations" shall have the meaning provided in the definition of "Obligations" in this Article VI.

"Patents" shall mean any United States patent now or hereafter owned by Borrower, as well as any application for a United States patent now or hereafter owned by Borrower, but excluding patents and applications for patents that Borrower is prohibited by written contract from assigning or granting a security interest in.

"Permitted Filings" shall mean any filing or similar item that was a matter of public record on October 12, 2001, with respect to Collateral secured by the Original Security Agreement, or on the date hereof, with respect to any other Collateral.

"Primary Obligations" shall have the meaning provided in Section 4.4(b) of this Agreement.

"Pro Rata Share" shall have the meaning provided in Section 4.4(b) of this Agreement.

"Proceeds" shall have the meaning provided in the Uniform Commercial Code.

"Representative" shall have the meaning provided in Section 5.4(e) of this Agreement.

"Required Secured Creditors" shall mean (i) the Required Lenders (or, to the extent required by Article XI of the Credit Agreement, all of the Lenders) under the Credit Agreement so long as any Credit Agreement Obligations remain outstanding and (ii) in any situation not covered by preceding clause (i), the holders of a majority of the outstanding principal amount of the Other Obligations.

"Requisite Creditors" shall have the meaning provided in Section 7.2 of this Agreement.

"Secondary Obligations" shall have the meaning provided in Section 4.4(b) of this Agreement.

"Secured Creditors" shall have the meaning provided in the first paragraph of this Agreement.

"Termination Date" shall have the meaning provided in Section 7.9 of this Agreement.

"Trade Secrets" shall mean any know-how, technology, product formulations, procedures and product and manufacturing specifications or standards now or hereafter utilized by Borrower in Borrower's business.

"Uniform Commercial Code" or "UCC" shall mean the Uniform Commercial Code as now or hereafter in effect from time to time in the State of New York or any other applicable jurisdiction.

"US Bank Letter of Credit Facility" means that certain revolving letter of credit facility in effect on the date hereof pursuant to that certain Continuing Reimbursement Agreement for Commercial Letters of Credit, dated as of July 14, 2000 by and among the LC Creditor and the Borrower providing for commercial letters of credit; provided, however, that at no time shall there be more than a maximum amount of $2,000,000 under the US Bank Letter of Credit Facility secured by the Security Documents.

ARTICLE VII
MISCELLANEOUS

7.1&nb3p;             Notices.  All such notices and communications hereunder shall be sent or delivered in accordance with the terms of the Credit Agreement.

7.2              Waiver; Amendment.   None of the terms and conditions of this Agreement may be changed, waived, modified or varied in any manner whatsoever unless in writing duly signed by Borrower and the Administrative Agent (with the written consent of the Required Lenders, or to the extent required by Section 11.1 of the Credit Agreement, all the Lenders); provided, however, that any change, waiver, modification or variance affecting the rights and benefits of a single Class of Secured Creditors (and not all Secured Creditors in a like or similar manner) shall require the written consent of the Requisite Creditors of such affected Class.  For the purpose of this Agreement, the term "Class" shall mean each class of Secured Creditors, i.e., whether (i) the Bank Creditors as holders of the Credit Agreement Obligations or (ii) the Other Creditors as the holders of the Other Obligations; and the term "Requisite Creditors" of any Class shall mean each of (A) with respect to the Credit Agreement Obligations, the Required Lenders and (B) with respect to the Other Obligations, the holders of at least a majority of all obligations outstanding from time to time under the Interest Rate Protection Agreements or Other Hedging Agreements.

7.3              Obligations Absolute.   The obligations of Borrower hereunder shall remain in full force and effect without regard to, and shall not be impaired by, (a) any bankruptcy, insolvency, reorganization, arrangement, readjustment, composition, liquidation or the like of Borrower; (b) any exercise or non-exercise, or any waiver of, any right, remedy, power or privilege under or in respect of this Agreement, any other Loan Document or any Interest Rate Protection or Other Hedging Agreement except as specifically set forth in a waiver granted pursuant to Section 7.2 hereof; or (c) any amendment to or modification of any Loan Document or any Interest Rate Protection or Other Hedging Agreement or any security for any of the Obligations; whether or not Borrower shall have notice or knowledge of any of the foregoing.

7.4              Successors and Assigns.  This Agreement shall be binding upon the parties hereto and their respective successors and assigns and shall inure to the benefit of the Administrative Agent, each Secured Creditor and Borrower and their respective successors and assigns, provided that Borrower may not transfer or assign any or all of its rights or obligations hereunder without the written consent of the Required Secured Creditors.  All agreements, statements, representations and warranties made by Borrower herein or in any certificate or other instrument delivered by Borrower or on its behalf under this Agreement shall be considered to have been relied upon by the Secured Creditors and shall survive the execution and delivery of this Agreement, the other Loan Documents and the Interest Rate Protection or Other Hedging Agreements regardless of any investigation made by the Secured Creditors or on their behalf.

7.5              Headings Descriptive.   The headings of the several sections of this Agreement are inserted for convenience only and shall not in any way affect the meaning or construction of any provision of this Agreement.

7.6              Severability.   Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating 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.

7.7              GOVERNING LAW.   THIS AGREEMENT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER THE LAWS OF THE STATE OF NEW YORK, AND FOR ALL PURPOSES SHALL BE CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS AND DECISIONS OF SAID STATE, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW.

7.8              Borrower's Duties.   It is expressly agreed, anything herein contained to the contrary notwithstanding, that Borrower shall remain liable to perform all of the obligations, if any, assumed by it with respect to the Collateral and the Administrative Agent shall not have any obligations or liabilities with respect to any Collateral by reason of or arising out of this Agreement, nor shall the Administrative Agent be required or obligated in any manner to perform or fulfill any of the obligations of Borrower under or with respect to any Collateral.

7.9              Termination; Release.   (a)  After the Termination Date, this Agreement shall automatically terminate (provided that all indemnities set forth herein including, without limitation, in Section 5.1 hereof shall survive such termination) and the Administrative Agent, at the request and expense of Borrower, will execute and deliver to Borrower a proper instrument or instruments (including Uniform Commercial Code termination statements on form UCC-3) acknowledging the satisfaction and termination of this Agreement, and will duly assign, transfer and deliver to Borrower (without recourse and without any representation or warranty) such of the Collateral of Borrower and as has not theretofore been sold or otherwise applied or released pursuant to this Agreement.  As used in this Agreement, "Termination Date" shall mean the date upon which all Interest Rate Protection or Other Hedging Agreements have been terminated, no Note under the Credit Agreement is outstanding (and all Loans have been repaid in full), all Letters of Credit have been terminated and all Obligations (as defined in the Credit Agreement) then outstanding (other than any indemnities described in Section 5.1 hereof and in Section 11.4 of the Credit Agreement with respect to which no claim has been asserted) have been paid in full in cash.

(b)        In the event that any part of the Collateral is sold or otherwise disposed of in connection with a sale or other disposition permitted by Section 8.7 of the Credit Agreement or is otherwise released at the direction of the Required Lenders (or all the Lenders if required by Section 11.1 of the Credit Agreement) and the proceeds of such sale or sales or from such release are applied in accordance with the provisions of Section 4.4 of the Credit Agreement, to the extent required to be so applied, such Collateral will be sold free and clear of the Liens created by this Agreement and the Administrative Agent, at the request and expense of Borrower, will duly assign, transfer and deliver to Borrower (without recourse and without any representation or warranty) such of the Collateral as is then being (or has been) so sold or released and has not theretofore been released pursuant to this Agreement.  The Administrative Agent shall also be entitled to and is hereby authorized and directed to duly assign, transfer and deliver such of the Collateral as provided in Section 11.20(b) of the Credit Agreement.

(c)        At any time that Borrower desires that the Administrative Agent take any action to acknowledge or give effect to any release of Collateral pursuant to the foregoing Section 7.9(a) or (b), as the case may be, it shall deliver to the Administrative Agent a certificate signed by an Authorized Officer stating that the release of the respective Collateral is permitted pursuant to Section 7.9(a) or (b), as the case may be.

(d)        The Administrative Agent shall have no liability whatsoever to any Secured Creditor as a result of any release of Collateral by it in accordance with this Section 7.9.

7.10          Counterparts.  This Agreement may be executed in any number of counterparts and by the different parties hereto on separate counterparts, each of which when so executed and delivered shall be an original, but all of which shall together constitute one and the same instrument.  A set of counterparts executed by all the parties hereto shall be lodged with Borrower and the Administrative Agent.

7.11          The Administrative Agent.  The Administrative Agent will hold in accordance with this Agreement all items of the Collateral at any time received under this Agreement.  It is expressly understood and agreed by the parties hereto and each Secured Creditor, by accepting the benefits of this Agreement, acknowledges and agrees that the obligations of the Administrative Agent as holder of the Collateral and interests therein and with respect to the disposition thereof, and otherwise under this Agreement, are only those expressly set forth in this Agreement and as provided in the Uniform Commercial Code in the State of New York.   The Administrative Agent shall act hereunder on the terms and conditions set forth in Article IX and Section 11.18 of the Credit Agreement.

7.12          US Bank.  (a) US Bank as LC Creditor under the US Bank Letter of Credit Facility and in its capacity as a Secured Party hereunder hereby irrevocably designates and appoints Bankers Trust Company as Administrative Agent under this Agreement and irrevocably authorizes Bankers Trust Company to act as its Administrative Agent and to take such action on its behalf under the provisions of this Agreement and to exercise such powers and perform such duties as are expressly delegated to the Administrative Agent under this Agreement and the Loan Documents, together with such other powers as are reasonably incidental thereto.  Notwithstanding any provision to the contrary in this Agreement, the Administrative Agent shall not have any duties or responsibilities with respect to US Bank in its capacity LC Creditor under the US Bank Letter of Credit Facility or any fiduciary relationship with US Bank, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this Agreement or otherwise exist against the Administrative Agent.

            (b)        For avoidance of doubt, US Bank expressly acknowledges that all rights and remedies of the Administrative Agent hereunder shall be exercised by the Administrative Agent in accordance with the applicable provisions of the Credit Agreement, and no consent of, or notice to, US Bank shall be required with respect thereto and US Bank shall not undertake any separate action with respect to the Collateral.  The sole right of US Bank hereunder shall be to receive its proportionate share of any proceeds received by the Administrative Agent hereunder in accordance with the terms hereof.

7.13          Amended and Restated.   This Agreement amends and restates the Original Security Agreement and is not in satisfaction of payment of any obligations thereunder and does not constitute a novation of the Original Security Agreement but rather shall relate back to the time of the Original Security Agreement for the purposes of filing and perfection.

ARTICLE VIII
SPECIAL PROVISIONS CONCERNING ACCOUNTS; CONTRACT RIGHTS; INSTRUMENTS

8.1              Additional Representations and Warranties.  As of the time when each of its Accounts arises, Borrower shall be deemed to have represented and warranted that such Account, and all records, papers and documents of Borrower relating thereto (if any) are genuine and in all material respects what they purport to be, and that all papers and documents of Borrower (if any) relating thereto to the best knowledge of Borrower (i) will represent the genuine, legal, valid and binding obligation of the account debtor evidencing indebtedness unpaid and owed by the respective account debtor arising out of the performance of labor or services or the sale or lease and delivery of the merchandise listed therein, or both, (ii) will be the only original writings of Borrower evidencing and embodying such obligation of the account debtor named therein (other than copies created for general accounting purposes), (iii) will evidence true and valid obligations, enforceable in accordance with their respective terms subject to applicable bankruptcy, insolvency, reorganization, moratorium and general principles of equityand (iv) will be in material compliance and will conform in all material respects with all applicable federal, state and local laws and applicable laws of any relevant foreign jurisdiction.

8.2              Maintenance of Records.  Borrower will keep and maintain at its own cost and expense accurate and complete records of its Accounts and Contracts, including, but not limited to, records of all payments received, all credits granted thereon, all merchandise returned and all other dealings therewith, and Borrower will make the same available on Borrower's premises to the Administrative Agent for inspection, at Borrower's own cost and expense (not to exceed reasonable costs and expenses), at any and all reasonable times upon prior notice to an Responsible Officer of Borrower.  At the request of the Administrative Agent and upon the occurrence and during the continuance of an Event of Default, Borrower shall, at its own cost and expense, deliver all tangible evidence of its Accounts and Contract Rights (including, without limitation, all documents evidencing the Accounts and all Contracts) and such books and records to the Administrative Agent or to its representatives (copies of which evidence and books and records may be retained by Borrower).  Upon the occurrence and during the continuance of an Event of Default, if the Administrative Agent so directs, Borrower shall legend, in form and manner reasonably satisfactory to the Administrative Agent, the Accounts and the Contracts, as well as books, records and documents of Borrower evidencing or pertaining to such Accounts and Contracts with an appropriate reference to the fact that the Administrative Agent and that the Administrative Agent has a security interest therein.

8.3              Modification of Terms; etc.  Borrower shall not rescind or cancel any indebtedness evidenced by any Account or under any Contract, or modify any term relating to such indebtedness or make any adjustment with respect thereto, or extend or renew the same, or compromise or settle any material dispute, claim, suit or legal proceeding relating thereto, or sell any Account or Contract, or interest therein, without the prior written consent of the Administrative Agent (not to be unreasonably withheld or delayed), except as permitted by Section 8.4 hereof or the Credit Agreement.   Borrower will duly fulfill in all material respects all obligations on its part to be fulfilled under or in connection with the Accounts and Contracts and will do nothing to impair the rights of the Administrative Agent in the Accounts or Contracts.

8.4              Collection.   Borrower shall endeavor to cause to be collected from the account debtor named in each of its Accounts or obligor under any Contract, as and when due (including, without limitation, amounts which are delinquent, such amounts to be collected in accordance with sound business judgement) any and all amounts owing under or on account of such Account or Contract, and apply forthwith upon receipt thereof all such amounts as are so collected to the outstanding balance of such Account or under such Contract, except that, unless an Event of Default has occurred and is continuing, Borrower may allow in the ordinary course of business as adjustments to amounts owing under its Accounts and Contracts (i) an extension or renewal of the time or times of payment, or settlement for less than the total unpaid balance, which Borrower finds appropriate in accordance with sound business judgment and (ii) a refund or credit due as a result of returned or damaged merchandise or improperly performed services or for other reasons which Borrower finds appropriate in accordance with sound business judgment.  The reasonable costs and expenses (including, without limitation, reasonable attorneys' fees) of collection, whether incurred by Borrower or the Administrative Agent, shall be borne by Borrower.

8.5              Instruments.  If Borrower owns or acquires any Instrument constituting Collateral, Borrower will within 15 days notify the Administrative Agent thereof, and upon request by the Administrative Agent will promptly deliver such Instrument to the Administrative Agent appropriately endorsed to the order of the Administrative Agent as further security hereunder.

8.6              Further Actions.   Borrower will, at its own expense, make, execute, endorse, acknowledge, file and/or deliver to the Administrative Agent from time to time such vouchers, invoices, schedules, confirmatory assignments, conveyances, financing statements, transfer endorsements, powers of attorney, certificates, reports and other assurances or instruments and take such further steps relating to its Accounts, Contracts, Instruments and other property or rights covered by the security interest hereby granted, as the Administrative Agent may reasonably require.

ARTICLE IX
SPECIAL PROVISIONS CONCERNING MARKS

9.1              Additional Representations and Warranties.  Borrower represents and warrants that it is the true and lawful exclusive owner of or otherwise has the right to use the Marks listed in Annex D(I) and D(II) hereto for Borrower and that said listed Marks include all the United States federal trademark registrations or applications registered in the United States Patent and Trademark Office.  Borrower represents and warrants that it owns or is licensed to use or is not prohibited from using all Marks that it uses.  Borrower further warrants that, except as set forth in Annex D(IV), it is aware of no third party claim that any aspect of Borrower's present or contemplated business operations infringes or will infringe any Mark.  Borrower represents and warrants that it is the owner of record of or otherwise has the right to use all United States registrations and applications listed in Annex D(I) and D(II) hereto and that said registrations are valid, subsisting, have not been canceled and that, except as set forth in Annex D(IV), Borrower is not aware of any third-party claim that any of said registrations is invalid or unenforceable.  Borrower hereby grants to the Administrative Agent an absolute power of attorney to sign, upon the occurrence and during the continuance of an Event of Default, any document which may be required by the United States Patent and Trademark Office in order to effect an absolute assignment of all right, title and interest in each Mark and associated goodwill, and record the same.

9.2              Licenses and Assignments.  Other than the license agreements listed on Annex E hereto and any extensions or renewals thereof, Borrower hereby agrees not to divest itself of any right under any Mark absent prior written approval of the Administrative Agent (which shall not be unreasonably withheld or delayed), except that Borrower may license any of its rights in such a Mark in the ordinary course of business provided that such license does not materially interfere with the business of Borrower.

9.3              Infringements.   Borrower agrees, promptly upon learning thereof, to notify the Administrative Agent in writing of the name and address of, and to furnish such pertinent information that may be available with respect to (except for any privileged communication), any party who may be infringing or otherwise violating any of Borrower's rights in and to any Mark to the extent that Borrower reasonably believes that such infringement or violation is material to its business, or with respect to any party claiming that Borrower's use of any Mark violates any property right of that party.  Borrower further agrees, if consistent with good business practice and unless otherwise agreed by the Administrative Agent, to diligently prosecute any Person infringing any Mark to the extent that Borrower reasonably believes that such infringement is material to its business.

9.4              Preservation of Marks.   Borrower agrees to use its Marks in interstate commerce during the time in which this Agreement is in effect, sufficiently to preserve such Marks as trademarks or service marks registered under the laws of the United States; provided that, to the extent permitted by the Credit Agreement, Borrower shall not be obligated to preserve any Mark in the event Borrower determines, in its reasonable business judgment, that the preservation of such Mark is no longer desirable in the conduct of its business.

9.5              Maintenance of Registration.  Borrower shall, at its own expense, diligently process all documents required by the Trademark Act of 1946, 15 U.S.C. §§ 1051 et seq. to maintain trademark registrations, including but not limited to affidavits of use and applications for renewals of registration in the United States Patent and Trademark Office for all of its Marks pursuant to 15 U.S.C. §§ 1058(a), 1059 and 1065, and shall pay all fees and disbursements in connection therewith and shall not abandon any such filing of affidavit of use or any such application of renewal prior to the exhaustion of all reasonable administrative and judicial remedies without prior written consent of the Administrative Agent (which consent will not be unreasonably withheld or delayed) except if, in its reasonable business judgment, such action is no longer desirable in the conduct of its business.

9.6              Future Registered Marks.  If any Mark registration issues hereafter to Borrower as a result of any application now or hereafter pending before the United States Patent and Trademark Office, within 60 days of receipt of such certificate, Borrower shall deliver to the Administrative Agent a copy of such certificate, and a grant of security in such Mark to the Administrative Agent, confirming the grant thereof hereunder, the form of such confirmatory grant to be substantially the same as the form hereof.

9.7              Remedies.  If an Event of Default shall occur and be continuing, the Administrative Agent may, by written notice to Borrower, take any or all of the following actions:  (i) declare the entire right, title and interest of Borrower in and to each of its Marks together with the goodwill of the business associated therewith, together with all trademark rights and rights of protection to the same, vested in the Administrative Agent for the benefit of the Secured Creditors, in which event such rights, title and interest shall immediately vest, in the Administrative Agent for the benefit of the Secured Creditors, in which case the Administrative Agent shall be entitled to exercise the power of attorney referred to in Section 9.1 to execute, cause to be acknowledged and notarized and record said absolute assignment with the applicable agency; (ii) take and use or sell the Marks together with the goodwill of Borrower's business symbolized by the Marks and the right to carry on the business and use the assets of Borrower in connection with which the Marks have been used; and (iii) direct Borrower to refrain, in which event Borrower shall refrain, from using the Marks in any manner whatsoever, directly or indirectly, and, if requested by the Administrative Agent, change Borrower's corporate name to eliminate therefrom any use of any Mark and execute such other and further documents that the Administrative Agent may request to further confirm this and to transfer ownership of the Marks and any registrations and any trademark application in the United States Patent and Trademark Office or any equivalent government agency or office in any foreign jurisdiction to the Administrative Agent.

ARTICLE X
SPECIAL PROVISIONS CONCERNING PATENTS AND COPYRIGHTS AND TRADE SECRETS

10.1          Additional Representations and Warranties.  Borrower represents and warrants that it is the true and lawful exclusive owner of or otherwise has the right to use (i) all material Trade Secrets necessary to operate the business of Borrower, (ii) the Patents listed in Annex F hereto for Borrower and (iii) the Copyrights listed in Annex G hereto for Borrower, that to the best of its knowledge said Patents include all the United States patents and applications for United States patents that Borrower now owns or otherwise has the right to use (except for any patent that Borrower does not have the right to assign or grant a security interest in) and that said Copyrights constitute all the United States copyrights registered with the United States Copyright Office and applications for United States copyrights that Borrower now owns or otherwise has the right to use and that in each case are necessary in the conduct of the business of Borrower.  Borrower represents and warrants that it owns or is licensed to practice under all Patents and Copyrights that it now uses or practices under.  Borrower further warrants that, except as set forth in Schedule F(I), it is aware of no third party claim that any aspect of Borrower's present or contemplated business operations infringes or will infringe any patent or any copyright or Borrower has misappropriated any Trade Secrets or proprietary information.   Borrower hereby grants to the Administrative Agent an absolute power of attorney to sign, upon the occurrence and during the continuance of any Event of Default, any document which may be required by the United States Patent and Trademark Office or the United States Copyright Office in order to effect an absolute assignment of all right, title and interest in each Patent and Copyright, and record the same.

10.2          Licenses and Assignments.  Other than the license agreements listed on Annex E hereto and any extensions or renewals thereof, Borrower hereby agrees not to divest itself of any right under any Patent or Copyright absent prior written approval of the Administrative Agent except that Borrower may license any of its rights to such Patent or Copyright in the ordinary course of business provided that such license does not materially interfere with the business of Borrower or any Subsidiary consistent with past practices or as is consistent with its existing licensing strategy.

10.3          Infringements.   Borrower agrees, promptly upon learning thereof, to furnish the Administrative Agent in writing with all pertinent information (except for any privileged information) available to Borrower with respect to any infringement or other violation of Borrower's rights in and to any Patent or Copyright to the extent that Borrower reasonably believes that such infringement or violation is material to its business, or with respect to any claim that practice of any Patent or Copyright violates any property right of a third party, or with respect to any misappropriation of any Trade Secret by Borrower or any claim that Borrower's practice of any Trade Secret violates any property right of a third party.  Borrower further agrees, consistent with good business practice and absent direction of the Administrative Agent to the contrary, diligently to prosecute any Person infringing any Patent or Copyright or any Person misappropriating any of such Borrower's Trade Secrets to the extent that Borrower reasonably believes that such infringement or misappropriation is material to its business.

10.4          Maintenance of Patents.  At its own expense, Borrower shall make timely payment of all post-issuance fees required pursuant to 35 U.S.C. § 41 to maintain in force rights under each Patent except if, in its reasonable business judgment, such maintenance of such Patent is no longer desirable in the conduct of its business.

10.5          Prosecution of Patent Application.  At its own expense, Borrower shall diligently prosecute all applications for Patents listed in Annex F hereto for Borrower and shall not abandon any such application prior to exhaustion of all reasonable administrative and judicial remedies, absent written consent of the Administrative Agent; provided, however, that to the extent permitted by the Credit Agreement, Borrower shall not be obligated to prosecute any application in the event Borrower determines, in its reasonable business judgment, that the prosecuting of such application is no longer necessary or desirable in the conduct of its business.

10.6          Other Patents and Copyrights.  Within 60 days of its acquisition of a Patent or Copyright, or of its filing of an application for a Patent or Copyright, Borrower shall deliver to the Administrative Agent a copy of said Patent or Copyright or such application, as the case may be, with a grant of security as to such Patent or Copyright, as the case may be, confirming the grant thereof hereunder, the form of such confirmatory grant to be substantially the same as the form hereof.

10.7          Remedies.  If an Event of Default shall occur and be continuing, the Administrative Agent may by written notice to Borrower, take any or all of the following actions:  (i) declare the entire right, title, and interest of Borrower in each of the Patents and Copyrights vested in the Administrative Agent for the benefit of the Secured Creditors, in which event such right, title, and interest shall immediately vest in the Administrative Agent for the benefit of the Secured Creditors, in which case the Administrative Agent shall be entitled to exercise the power of attorney referred to in Section 10.1 hereof to execute, cause to be acknowledged and notarized and record said absolute assignment with the applicable agency; (ii) take and practice or sell the Patents and Copyrights; and (iii) direct Borrower to refrain, in which event Borrower shall refrain, from practicing the Patents and using the Copyrights directly or indirectly, and Borrower shall execute such other and further documents as the Administrative Agent may request further to confirm this and to transfer ownership of the Patents and Copyrights to the Administrative Agent for the benefit of the Secured Creditors.

[Signature Page Follows]

                        IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed and delivered by their duly authorized officers as of the date first above written.

BMC INDUSTRIES, INC.,
as Borrower

By:  /s/ Bradley D. Carlson

Name:  Bradley D. Carlson

Title:  Treasurer

DEUTSCHE BANK TRUST COMPANY AMERICAS (formerly named Bankers Trust Company),
as Administrative Agent

By:  /s/ Mary Jo Jolly

Name:  Mary Jo Jolly

Title:  Assistant Vice President

U.S. BANK NATIONAL ASSOCIATION

By:  /s/ Nicholas G. Myers

Name:  Nicholas G. Myers

Title:  Assistant Vice President

EX-10.47 5 sub_security-agreement.htm

TABLE OF CONTENTS

ARTICLE I SECURITY INTERESTS			2
	1.1	Grant of Security Interests	2
	1.2	Power of Attorney	3
ARTICLE II GENERAL REPRESENTATIONS, WARRANTIES AND COVENANTS			3
	2.1	Chief Executive Office/Inventory and Equipment Locations	3
	2.2	State of Incorporation	3
	2.3	Trade Names; Change of Name	4
ARTICLE III PROVISIONS CONCERNING ALL COLLATERAL			5
	3.1	Protection of Administrative Agent's Security	5
	3.2	Warehouse Receipts Non-Negotiable; Third-Party Acknowledgments	5
	3.3	Further Actions	5
	3.4	Financing Statements	5
ARTICLE IV REMEDIES UPON OCCURRENCE OF EVENT OF DEFAULT			5
	4.1	Remedies; Obtaining the Collateral Upon Default	5
	4.2	Remedies; Disposition of the Collateral	7
	4.3	Waiver of Claims	7
	4.4	Application of Proceeds	8
	4.5	Remedies Cumulative	10
	4.6	Discontinuance of Proceedings	11
ARTICLE V INDEMNITY			11
	5.1	Indemnity	11
	5.2	Indemnity Obligations Secured by Collateral; Survival	12
ARTICLE VI DEFINITIONS			12
ARTICLE VII MISCELLANEOUS			16
	7.1	Notices	16
	7.2	Waiver; Amendment	16
	7.3	Obligations Absolute	17
	7.4	Successors and Assigns	17
	7.5	Headings Descriptive	17
	7.6	Severability	17
	7.7	GOVERNING LAW	17
	7.8	Each Guarantor's Duties	17
	7.9	Termination; Release	18
	7.10	Counterparts	18
	7.11	The Administrative Agent	19
	7.12	US Bank	19
	7.13	Additional Guarantors	19
	7.14	Amended and Restated	19
ARTICLE VIII SPECIAL PROVISIONS CONCERNING ACCOUNTS; CONTRACT RIGHTS;  INSTRUMENTS			20
	8.1	Additional Representations and Warranties	20
	8.2	Maintenance of Records	20
	8.3	Modification of Terms; etc	20
	8.4	Collection	21
	8.5	Instruments	21
	8.6	Further Actions	21
ARTICLE IX SPECIAL PROVISIONS CONCERNING MARKS			21
	9.1	Additional Representations and Warranties	21
	9.2	Licenses and Assignments	22
	9.3	Infringements	22
	9.4	Preservation of Marks	22
	9.5	Maintenance of Registration	22
	9.6	Future Registered Marks	22
	9.7	Remedies	23
ARTICLE X SPECIAL PROVISIONS CONCERNING PATENTS AND COPYRIGHTS AND TRADE SECRETS			23
	10.1	Additional Representations and Warranties	23
	10.2	Licenses and Assignments	24
	10.3	Infringements	24
	10.4	Maintenance of Patents	24
	10.5	Prosecution of Patent Application	24
	10.6	Other Patents and Copyrights	24
	10.7	Remedies	24

ANNEX A	Schedule of Chief Executive Offices
ANNEX B	Schedule of Inventory and Equipment Locations
ANNEX C	Schedule of Trade, Fictitious and Other Names
ANNEX D	Schedule of Marks
ANNEX E	Schedule of License Agreements and Assignments
ANNEX F	Schedule of Patents and Copyrights
ANNEX G	Schedule of Copyrights and Applications
ANNEX H	Assignment of Security Interest in U.S. Trademarks and Patents
ANNEX I	Assignment of Security Interest in U.S. Copyrights

      xxx

AMENDED AND RESTATED

SUBSIDIARY GUARANTOR SECURITY AGREEMENT

between

VISION-EASE LENS, INC.,

VISION-EASE LENS AZUSA, INC.,

DEUTSCHE BANK TRUST COMPANY AMERICAS
(formerly named Bankers Trust Company),
as Administrative Agent

and

U.S. BANK NATIONAL ASSOCIATION

Dated as of September 27, 2002

AMENDED AND RESTATED SUBSIDIARY GUARANTOR SECURITY AGREEMENT

THIS AMENDED AND RESTATED SUBSIDIARY GUARANTOR SECURITY AGREEMENT (this "Agreement"), dated as of September 27, 2002, is among the undersigned (each a "Guarantor" and, together with any other entity that becomes party hereto pursuant to Section 7.13 hereof, collectively, the "Guarantors"), DEUTSCHE BANK TRUST COMPANY AMERICAS (formerly named Bankers Trust Company), as administrative agent (the "Administrative Agent") and U.S. BANK NATIONAL ASSOCIATION ("US Bank") for the benefit of (i) the Lenders and the Agent under the Credit Agreement hereinafter referred to (such Lenders and the Agent are hereinafter called the "Bank Creditors"), (ii) if one or more Lenders (or any Affiliate thereof) enter into one or more (A) interest rate protection agreements (including, without limitation, interest rate swaps, caps, floors, collars and similar agreements), (B) foreign exchange contracts, currency swap agreements or other similar agreements or arrangements designed to protect against the fluctuations in currency values and/or (C) other types of hedging agreements from time to time (collectively, the "Interest Rate Protection or Other Hedging Agreements") with, or guaranteed by, Borrower, any such Lender or Lenders or any Affiliate of such Lender or Lenders (even if the respective Lender subsequently ceases to be a Lender under the Credit Agreement for any reason) so long as any such Lender or Affiliate participates in the extension of such Interest Rate Protection or Other Hedging Agreements and their subsequent assigns, if any (collectively, the "Other Creditors") and (iii) US Bank as lender under the US Bank Letter of Credit Facility (as defined below) (the "LC Creditor" and, together with the Other Creditors and the Bank Creditors, hereinafter called the "Secured Creditors").  Except as otherwise defined herein, terms used herein and defined in the Credit Agreement (as hereinafter defined) shall be used herein as so defined.

W I T N E S S E T H :

WHEREAS, BMC Industries, Inc. (the "Borrower"), the financial institutions (the "Lenders") from time to time party thereto and Bankers Trust Company, as Administrative Agent (together with any successor agent, the "Agent"), have entered into an Amended and Restated Credit Agreement, dated as of June 25, 1998, providing for the making of Loans and the issuance of, and participation in, Letters of Credit as contemplated therein (as used herein, the term "Credit Agreement" means the Credit Agreement described above in this paragraph, as in effect on the date hereof and as amended by that certain Second Amendment and Restatement Agreement dated as of October 12, 2001 and as amended and restated by that certain Third Amended and Restated Credit Agreement dated as of the date hereof, as the same may be amended, modified, extended, renewed, replaced, restated or supplemented from time to time, and including any agreement extending the maturity of or restructuring of all or any portion of the Indebtedness under such agreement or any successor agreements);

WHEREAS, Borrower may at any time and from time to time enter into, or guarantee, one or more Interest Rate Protection or Other Hedging Agreements with one or more Other Creditors;

WHEREAS, Borrower, Administrative Agent and US Bank previously entered into a Security Agreement dated as of October 12, 2001 (the "Original Security Agreement");

WHEREAS, it is a condition precedent to each of the above-described extensions of credit that Borrower shall have executed and delivered this Agreement which shall amend and restate the Original Security Agreement in its entirety; and

WHEREAS, pursuant to the Amended and Restated Subsidiary Guarantee Agreement, dated October 12, 2001, each Guarantor has jointly and severally guaranteed to the Secured Creditors the payment when due of certain obligations of Borrower and each Guarantor under or with respect to the Loan Documents, the Interest Rate Protection or Other Hedging Agreements and the US Bank Letter of Credit Facility (provided that at no time shall there be more than $2,000,000 under the US Bank Letter of Credit Facility secured by the Security Documents);

WHEREAS, each Guarantor desires to enter into this Agreement in order to satisfy the condition described in the preceding paragraph;

NOW, THEREFORE, in consideration of the extensions of credit to be made to Borrower and other benefits accruing to each Guarantor, the receipt and sufficiency of which are hereby acknowledged, each Guarantor hereby makes the following representations and warranties to the Administrative Agent for the benefit of the Secured Creditors and hereby covenants and agrees with the Administrative Agent for the benefit of the Secured Creditors as follows:

ARTICLE I
SECURITY INTERESTS

1.1              Grant of Security Interests.  (a)  As security for the prompt and complete payment and performance when due of all of the Obligations, each Guarantor does hereby pledge and grant to the Administrative Agent for the benefit of the Secured Creditors, a continuing security interest of first priority (subject to Liens evidenced by Permitted Filings and other Permitted Liens) in, all of the right, title and interest of such Guarantor in, to and under all of the following, whether now existing or hereafter from time to time acquired:  (i) each and every Account, (ii) all Contracts, together with all Contract Rights arising thereunder, (iii) all Inventory, (iv) all Equipment, (v) Marks, together with the registrations and right to all renewals thereof, and the goodwill of the business of such Guarantor symbolized by the Marks, (vi) all Patents and Copyrights, and all reissues, renewals or extensions thereof, (vii) all computer programs of such Guarantor and all intellectual property rights therein and all other proprietary information of such Guarantor, including, but not limited to, Trade Secrets, (viii) all other Goods, General Intangibles, Chattel Paper, Documents, Investment Property and Instruments, and (ix) policies now or at any time hereafter in the possession or under control of such Guarantor or its respective bailees and any interest therein, (xii) all vehicles, aircraft, vessels, barges, railcars, rolling stock and fixtures owned by such Guarantor, together with accessions thereto and replacement parts therefor, and (xiii) all Proceeds and products of any and all of the foregoing (all of the above, collectively, the "Collateral").

(b)  The security interests of the Administrative Agent under this Agreement extend to all Collateral of the kind which is the subject of this Agreement which any Guarantor may acquire at any time during the continuation of this Agreement.

1.2              Power of Attorney.   Each Guarantor hereby constitutes and appoints the Administrative Agent its true and lawful attorney, with full power after the occurrence of and during the continuance of an Event of Default (in the name of such Guarantor or otherwise), in the Administrative Agent's reasonable discretion, to take any action and to execute any instrument required by this Agreement if such Guarantor has failed to do so after demand by the Administrative Agent.

ARTICLE II
GENERAL REPRESENTATIONS, WARRANTIES AND COVENANTS

Each Guarantor represents, warrants and covenants, which representations, warranties and covenants shall survive execution and delivery of this Agreement, as follows:

2.1              Chief Executive Office/Inventory and Equipment Locations.  The chief executive office of such Guarantor is located at the address indicated on Annex A hereto.  All Inventory and Equipment held on the date hereof by such Guarantor is located at one of the locations shown on Annex B hereto (other than (i) immaterial portions of Inventory or Equipment or (ii) Equipment out for repair).    Prior to January 1, 2002, such Guarantor shall not (x) move its chief executive office to any of the States of Mississippi, Alabama or Florida, or (y) move any Inventory or Equipment to any of the States of Mississippi, Alabama or Florida until (i) it shall have given to the Administrative Agent not less than 30 days' prior written notice of its intention to do so, (ii) with respect to such move, it shall have taken all action, reasonably satisfactory to the Administrative Agent, to maintain the security interest of the Administrative Agent in the Collateral intended to be granted and perfected under the Uniform Commercial Code hereby at all times fully perfected and in full force and effect, (iii) at the reasonable request of the Administrative Agent, it shall have furnished a customary opinion of counsel reasonably acceptable to the Administrative Agent to the effect that all financing or continuation statements and amendments or supplements thereto have been filed in the appropriate filing office or offices, and all other actions (including, without limitation, the payment of all filing fees and taxes, if any, payable in connection with such filings) have been taken, in order to perfect (and maintain the perfection and priority of) the security interest granted hereby and (iv) the Administrative Agent shall have received evidence that all other actions (including, without limitation, the payment of all filing fees and taxes, if any, payable in connection with such filings) have been taken, in order to perfect (and maintain the perfection and priority of) the security interest granted hereby.

2.2              State of Incorporation.  The state of incorporation of each Guarantor is indicated on Annex A hereto.  No Guarantor will change its state of incorporation except as in accordance with the last sentence of this Section 2.2.  No Guarantor shall establish a new state of incorporation until (i) it shall have given to the Administrative Agent not less than 30 days' prior written notice of its intention to do so, clearly describing such new state of incorporation and providing such other information in connection therewith as the Administrative Agent may reasonably request, (ii) with respect to such new state of incorporation, it shall have taken all action, reasonably satisfactory to the Administrative Agent, to maintain the security interest of the Administrative Agent in the Collateral intended to be granted and perfected under the Uniform Commercial Code hereby at all times fully perfected and in full force and effect, (iii) at the reasonable request of the Administrative Agent, it shall have furnished a customary opinion of counsel reasonably acceptable to the Administrative Agent to the effect that all financing or continuation statements and amendments or supplements thereto have been filed in the appropriate filing office or offices, and all other actions (including, without limitation, the payment of all filing fees and taxes, if any, payable in connection with such filings) have been taken, in order to perfect (and maintain the perfection and priority of) the security interest granted hereby and (iv) the Administrative Agent shall have received evidence that all other actions (including, without limitation, the payment of all filing fees and taxes, if any, payable in connection with such filings have been taken, in order to perfect (and maintain the perfection and priority of) the security interest granted hereby.

2.3              Trade Names; Change of Name.  No Guarantor operates in any jurisdiction under, nor in the preceding 12 months has operated in any jurisdiction under, any trade names, fictitious names or other names (including, without limitation, any names of divisions or operations) except its legal name and such other trade, fictitious or other names as are listed on Annex C hereto.  The corporation identification number or other applicable formation identification number shall be set forth across from the exact legal name of each Guarantor identified in Annex C.  No Guarantor shall change its legal name or assume or operate in any jurisdiction under any trade, fictitious or other name in any manner which might make any financing statement or continuation statement filed in connection therewith seriously misleading except those names listed on Annex C hereto and new names (including, without limitation, any names of divisions or operations) established in accordance with the last sentence of this Section 2.3.  No Guarantor shall assume or operate in any jurisdiction under any new trade, fictitious or other name that would make any financing statement or continuation statement filed in connection therewith, seriously misleading until (i) it shall have given to the Administrative Agent not less than 30 days' prior written notice of its intention so to do, clearly describing such new name and the jurisdictions in which such new name shall be used and providing such other information in connection therewith as the Administrative Agent may reasonably request, (ii) with respect to such new name, it shall have taken all action to maintain the security interest of the Administrative Agent in the Collateral intended to be granted hereby at all times fully perfected and in full force and effect, (iii) at the reasonable request of the Administrative Agent, it shall have furnished a customary opinion of counsel reasonablyacceptable to the Administrative Agent to the effect that all financing or continuation statements and amendments or supplements thereto have been filed in the appropriate filing office or offices, and (iv) the Administrative Agent shall have received evidence that all other actions (including, without limitation, the payment of all filing fees and taxes, if any, payable in connection with such filings) have been taken, in order to perfect (and maintain the perfection and priority of) the security interest granted hereby.

ARTICLE III
PROVISIONS CONCERNING ALL COLLATERAL

3.1              Protection of Administrative Agent's Security.  No Guarantor will do anything to impair the rights of the Administrative Agent in the Collateral other than dispositions, the creation of Liens and other encumbrances and other actions permitted hereunder and under the Credit Agreement and other Loan Documents.  

3.2              Warehouse Receipts Non-Negotiable; Third-Party Acknowledgments.  Each Guarantor agrees that if any warehouse receipt or receipt in the nature of a warehouse receipt is issued with respect to any of its Inventory, such warehouse receipt or receipt in the nature thereof shall not be "negotiable" (as such term is used in Section 7-104 of the Uniform Commercial Code as in effect in any relevant jurisdiction or under other relevant law).  Where Collateral with a fair market value of greater than $100,000 is in the possession of a third party, each Guarantor will promptly notify Administrative Agent of the occurrence of any such fact and will join with the Administrative Agent in notifying the third party of the Administrative Agent's security interest and obtaining an acknowledgment from the third party that it is holding the Collateral for the benefit of the Administrative Agent.

3.3              Further Actions.   Each Guarantor will, at its own expense, make, execute, endorse, acknowledge, file and/or deliver to the Administrative Agent from time to time such lists, descriptions and designations of its Collateral, warehouse receipts, receipts in the nature of warehouse receipts, bills of lading, documents of title, vouchers, invoices, schedules, confirmatory assignments, conveyances, financing statements, transfer endorsements, powers of attorney, certificates, reports and other assurances or instruments and take such further steps relating to the Collateral and other property or rights covered by the security interest hereby granted, which the Administrative Agent deems reasonably appropriate or advisable to perfect, preserve or protect its security interest in the Collateral.  

3.4              Financing Statements.   Each Guarantor agrees to deliver to the Administrative Agent such financing statements, in form reasonably acceptable to the Administrative Agent, as the Administrative Agent may from time to time reasonably request or as are reasonably  necessary (or desirable in the reasonable opinion of the Administrative Agent) to establish and maintain a valid, enforceable, first priority perfected security interest (subject only to Permitted Liens) in the Collateral as provided herein and the other rights and security contemplated hereby all in accordance with the Uniform Commercial Code as enacted in any and all relevant jurisdictions or any other relevant law.  Each Guarantor will pay any applicable filing fees, recordation taxes and related expenses relating to its Collateral.  Each Guarantor hereby authorizes the Administrative Agent to file any such Uniform Commercial Code financing statements without the signature of such Guarantor where permitted by law.

ARTICLE IV
REMEDIES UPON OCCURRENCE OF EVENT OF DEFAULT

4.1              Remedies; Obtaining the Collateral Upon Default.  Each Guarantor agrees that, if any Event of Default shall have occurred and be continuing, then and in every such case, subject to any mandatory requirements of applicable law then in effect, the Administrative Agent, in addition to any rights now or hereafter existing under applicable law, shall have all rights as a secured creditor under the Uniform Commercial Code in all relevant jurisdictions and may:

(a)            personally, or by agents or attorneys, immediately take possession of the Collateral or any part thereof, from such Guarantor or any other Person who then has possession of any part thereof with or without notice or process of law, and for that purpose may enter upon such Guarantor's premises where any of the Collateral is located and remove the same and use in connection with such removal any and all services, supplies, aids and other facilities of such Guarantor; and

(b)            instruct the obligor or obligors on any agreement, instrument or other obligation (including, without limitation, the Accounts and the Contracts) constituting the Collateral to make any payment required by the terms of such agreement, instrument or other obligation directly to the Administrative Agent and may exercise any and all remedies of such Guarantor in respect of such Collateral; and

(c)            sell, assign or otherwise liquidate, or direct such Guarantor to sell, assign or otherwise liquidate, any or all of the Collateral or any part thereof, and take possession of the proceeds of any such sale or liquidation; and

(d)            take possession of the Collateral or any part thereof, by directing such Guarantor in writing to deliver the same to the Administrative Agent at any place or places reasonably designated by the Administrative Agent, in which event such Guarantor shall at its own expense:

(i)             forthwith cause the same to be moved to the place or places so designated by the Administrative Agent and there delivered to the Administrative Agent, and

(ii)             store and keep any Collateral so delivered to the Administrative Agent at such place or places pending further action by the Administrative Agent as provided in Section 6.2 hereof, and

(iii)             while the Collateral shall be so stored and kept, provide such guards and maintenance services as shall be necessary to protect the same and to preserve and maintain them in good condition; and

(e)            license or sublicense (to the extent not in violation of the license), whether on an exclusive or nonexclusive basis, any Marks (together with associated goodwill), Patents or Copyrights included in the Collateral for such term and on such conditions and in such manner as the Administrative Agent shall in its sole judgment determine (taking into account such provisions as may be necessary to protect and preserve such Marks, Patents or Copyrights); and

it being understood that each Guarantor's obligation so to deliver the Collateral is of the essence of this Agreement and that, accordingly, upon application to a court of equity having jurisdiction, the Administrative Agent shall be entitled to seek a decree requiring specific performance by such Guarantor of said obligation.

4.2              Remedies; Disposition of the Collateral.  If an Event of Default shall have occurred and be continuing, then any Collateral repossessed by the Administrative Agent under or pursuant to Section 4.1 hereof and any other Collateral whether or not so repossessed by the Administrative Agent, may be sold, assigned, leased or otherwise disposed of under one or more contracts or as an entirety, and without the necessity of gathering at the place of sale the property to be sold, and in general in such manner, at such time or times, at such place or places and on such terms as the Administrative Agent may, in compliance with any mandatory requirements of applicable law, determine to be commercially reasonable.  Any of the Collateral may be so sold, leased or otherwise disposed of, in the condition in which the same existed when taken by the Administrative Agent or after any overhaul or repair at the expense of the relevant Guarantor which the Administrative Agent shall determine to be commercially reasonable.   Any such disposition which shall be a private sale or other private proceedings permitted by such requirements shall be made upon not less than 10 days' written notice to the relevant Guarantor specifying the time at which such disposition is to be made and the intended sale price or other consideration therefor, and shall be subject, for the 10 days after the giving of such notice, to the right of such Guarantor or any nominee of such Guarantor to acquire the Collateral involved at a price or for such other consideration at least equal to the intended sale price or other consideration so specified.  Any such disposition which shall be a public sale permitted by such requirements shall be made upon not less than 10 days' written notice to the relevant Guarantor specifying the time and place of such sale and, in the absence of applicable requirements of law, shall be by public auction (which may, at the Administrative Agent's option, be subject to reserve), after publication of notice of such auction not less than 10 days prior thereto in two newspapers in general circulation in the City of New York or in such other locations as may be necessary in order for the sale to be "commercially reasonable" (as such term is used in Article 9 Part V of the New York Uniform Commercial Code).  To the extent permitted by any such requirement of law, the Administrative Agent and the Secured Creditors may bid for and become the purchaser of the Collateral or any item thereof, offered for sale in accordance with this Section without accountability to such Guarantor.  If, under mandatory requirements of applicable law, the Administrative Agent shall be required to make disposition of the Collateral within a period of time which does not permit the giving of notice to the relevant Guarantor as hereinabove specified, the Administrative Agent need give such Guarantor only such notice of disposition as shall be reasonably practicable in view of such mandatory requirements of applicable law.  Each Guarantor agrees to do or cause to be done all such other acts and things as may be reasonably necessary to make such sale or sales of all or any portion of the Collateral valid and binding and in compliance with any and all applicable laws, regulations, orders, writs, injunctions, decrees or awards of any and all courts, arbitrators or governmental instrumentalities, domestic or foreign, having jurisdiction over any such sale or sales, all at such Guarantor's expense.

4.3              Waiver of Claims.   Except as otherwise provided in this Agreement, EACH GUARANTOR HEREBY WAIVES, TO THE EXTENT PERMITTED BY APPLICABLE LAW, NOTICE AND JUDICIAL HEARING IN CONNECTION WITH THE ADMINISTRATIVE AGENT'S TAKING POSSESSION OR THE ADMINISTRATIVE AGENT'S DISPOSITION OF ANY OF THE COLLATERAL, INCLUDING, WITHOUT LIMITATION, ANY AND ALL PRIOR NOTICE AND HEARING FOR ANY PREJUDGMENT REMEDY OR REMEDIES AND ANY SUCH RIGHT WHICH SUCH GUARANTOR WOULD OTHERWISE HAVE UNDER THE CONSTITUTION OR ANY STATUTE OF THE UNITED STATES OR OF ANY STATE, and each Guarantor hereby further waives, to the extent permitted by law:

(a)            all damages occasioned by such taking of possession except any damages which are the direct result of the Administrative Agent's gross negligence or willful misconduct;

(b)            all other requirements as to the time, place and terms of sale or other requirements with respect to the enforcement of the Administrative Agent's rights hereunder; and

(c)            all rights of redemption, appraisement, valuation, stay, extension or moratorium now or hereafter in force under any applicable law in order to prevent or delay the enforcement of this Agreement or the absolute sale of the Collateral or any portion thereof, and such Guarantor, for itself and all who may claim under it, insofar as it or they now or hereafter lawfully may, hereby waives the benefit of all such laws.

Any sale of, or the grant of options to purchase, or any other realization upon, any Collateral shall operate to divest all right, title, interest, claim and demand, either at law or in equity, of such Guarantor therein and thereto, and shall be a perpetual bar both at law and in equity against such Guarantor and against any and all Persons claiming or attempting to claim the Collateral so sold, optioned or realized upon, or any part thereof, from, through and under such Guarantor.

4.4              Application of Proceeds.  (a)  All moneys collected by the Administrative Agent (or, to the extent the Pledge Agreement or any Mortgage to which any Guarantor is a party requires proceeds of Collateral under such agreement to be applied in accordance with the provisions of this Agreement, the Pledgee or Mortgagee under such other agreement) upon any sale or other disposition of the Collateral, together with all other moneys received by the Administrative Agent hereunder, shall be applied as follows:  

(i)            first, to the payment of all amounts owing the Administrative Agent of the type described in clauses (iii) and (iv) of the definition of "Obligations";

(ii)            second, to the extent proceeds remain after the application pursuant to the preceding clause (i), an amount equal to the outstanding Primary Obligations shall be paid to the Secured Creditors as provided in Section 4.4(e) hereof, with each Secured Creditor receiving an amount equal to such outstanding Primary Obligations or, if the proceeds are insufficient to pay in full all such Primary Obligations, its Pro Rata Share of the amount remaining to be distributed;

(iii)            third, to the extent proceeds remain after the application pursuant to the preceding clauses (i) and (ii), an amount equal to the outstanding Secondary Obligations shall be paid to the Secured Creditors as provided in Section 4.4(e), with each Secured Creditor receiving an amount equal to its outstanding Secondary Obligations or, if the proceeds are insufficient to pay in full all such Secondary Obligations, its Pro Rata Share of the amount remaining to be distributed; and

(iv)            fourth, to the extent proceeds remain after the application pursuant to the preceding clauses (i) through (iii), inclusive, and following the termination of this Agreement pursuant to Section 7.9(a) hereof, to such Guarantor or to whomever may be lawfully entitled to receive such surplus.

(b)         For purposes of this Agreement (i) "Pro Rata Share" shall mean, when calculating a Secured Creditor's portion of any distribution or amount, that amount (expressed as a percentage) equal to a fraction the numerator of which is the then unpaid amount of such Secured Creditor's Primary Obligations or Secondary Obligations, as the case may be, and the denominator of which is the then outstanding amount of all Primary Obligations or Secondary Obligations, as the case may be, (ii) "Primary Obligations" shall mean (A) in the case of the Credit Agreement Obligations, all principal of, and interest on, all Loans, all Unpaid Drawings theretofore made (together with all interest accrued thereon), and the aggregate Stated Amounts of all Letters of Credit issued (or deemed issued) under the Credit Agreement, and all Fees and (B) in the case of the Other Obligations, all amounts due under the Interest Rate Protection or Other Hedging Agreements (other than indemnities, fees (including, without limitation, attorneys' fees) and similar obligations and liabilities) and (iii) "Secondary Obligations" shall mean all Obligations other than Primary Obligations.

(c)         When payments to Secured Creditors are based upon their respective Pro Rata Shares, the amounts received by such Secured Creditors hereunder shall be applied (for purposes of making determinations under this Section 4.4 only) (i) first, to their Primary Obligations and (ii) second, to their Secondary Obligations.  If any payment to any Secured Creditor of its Pro Rata Share of any distribution would result in overpayment to such Secured Creditor, such excess amount shall instead be distributed in respect of the unpaid Primary Obligations or Secondary Obligations, as the case may be, of the other Secured Creditors, with each Secured Creditor whose Primary Obligations or Secondary Obligations, as the case may be, have not been paid in full to receive an amount equal to such excess amount multiplied by a fraction the numerator of which is the unpaid Primary Obligations or Secondary Obligations, as the case may be, of such Secured Creditor and the denominator of which is the unpaid Primary Obligations or Secondary Obligations, as the case may be, of all Secured Creditors entitled to such distribution.

(d)         Each of the Secured Creditors agrees and acknowledges that if the Bank Creditors are to receive a distribution on account of undrawn amounts with respect to Letters of Credit issued (or deemed issued) under the Credit Agreement (which shall only occur after all outstanding Loans and Unpaid Drawings with respect to such Letters of Credit have been paid in full), such amounts shall be paid to the Agent under the Credit Agreement and held by it, for the equal and ratable benefit of the Bank Creditors, as cash security for the repayment of Obligations owing to the Bank Creditors as such.  If any amounts are held as cash security pursuant to the immediately preceding sentence, then upon the termination of all outstanding Letters of Credit, and after the application of all such cash security to the repayment of all Obligations owing to the Bank Creditors after giving effect to the termination of all such Letters of Credit, if there remains any excess cash, such excess cash shall be returned by the Agent to the Administrative Agent for distribution in accordance with Section 4.4(a) hereof.

(e)         Except as set forth in Section 4.4(d) hereof, all payments required to be made hereunder shall be made (i) if to the Bank Creditors, to the Agent under the Credit Agreement for the account of the Bank Creditors, and (ii) if to the Other Creditors, to the trustee, paying agent or other similar representative (each a "Representative") for the Other Creditors or, in the absence of such a Representative, directly to the Other Creditors.

(f)          For purposes of applying payments received in accordance with this Section 4.4, the Administrative Agent shall be entitled to rely upon (i) the Agent under the Credit Agreement and (ii) the Representative for the Other Creditors or, in the absence of such a Representative, upon the Other Creditors for a determination (which the Agent, each Representative for any Secured Creditors and the Secured Creditors agree (or shall agree) to provide upon request of the Administrative Agent) of the outstanding Primary Obligations and Secondary Obligations owed to the Bank Creditors or the Other Creditors, as the case may be.  Unless it has actual knowledge (including by way of written notice from a Bank Creditor or an Other Creditor) to the contrary, the Agent and each Representative, in furnishing information pursuant to the preceding sentence, and the Administrative Agent, in acting hereunder, shall be entitled to assume that no Secondary Obligations are outstanding.  Unless it has actual knowledge (including by way of written notice from an Other Creditor) to the contrary, the Administrative Agent, in acting hereunder, shall be entitled to assume that no Interest Rate Protection or Other Hedging Agreements are in existence.

(g)         It is understood and agreed that each Guarantor shall remain jointly and severally liable to the extent of any deficiency between the amount of the proceeds of the Collateral hereunder and the aggregate amount of the sums referred to in clauses (i) through (iii), inclusive, of Section 4.4(a) hereof.

4.5              Remedies Cumulative.   Each and every right, power and remedy hereby specifically given to the Administrative Agent shall be in addition to every other right, power and remedy specifically given under this Agreement, the Interest Rate Protection or Other Hedging Agreements, the other Loan Documents or now or hereafter existing at law or in equity, or by statute and each and every right, power and remedy whether specifically herein given or otherwise existing may be exercised from time to time or simultaneously and as often and in such order as may be deemed expedient by the Administrative Agent.   All such rights, powers and remedies shall be cumulative and the exercise or the beginning of the exercise of one shall not be deemed a waiver of the right to exercise any other or others.   No delay or omission of the Administrative Agent in the exercise of any such right, power or remedy and no renewal or extension of any of the Obligations and no course of dealing between any Guarantor and the Administrative Agent or any holder of any of the Obligations shall impair any such right, power or remedy or shall be construed to be a waiver of any Default or Event of Default or an acquiescence therein.  No notice to or demand on any Guarantor in any case shall entitle it to any other or further notice or demand in similar or other circumstances or constitute a waiver of any of the rights of the Administrative Agent to any other or further action in any circumstances without notice or demand.  In the event that the Administrative Agent shall bring any suit to enforce any of its rights hereunder and shall be entitled to judgment, then in such suit the Administrative Agent may recover reasonable expenses, including reasonable attorneys' fees, and the amounts thereof shall be included in such judgment.

4.6              Discontinuance of Proceedings.  In case the Administrative Agent shall have instituted any proceeding to enforce any right, power or remedy under this Agreement by foreclosure, sale, entry or otherwise, and such proceeding shall have been discontinued or abandoned for any reason or shall have been determined adversely to the Administrative Agent, then and in every such case each Guarantor, the Administrative Agent and each holder of any of the Obligations shall be restored to their former positions and rights hereunder with respect to the Collateral subject to the security interest created under this Agreement (except to the extent of any such adverse determination), and all rights, remedies and powers of the Administrative Agent shall continue (a) as if no such proceeding had been instituted, in the case of any such proceeding so discontinued or abandoned, or (b) as if no proceeding had been instituted, except to the extent of the determination, in the case of any such proceeding so adversely determined.

ARTICLE V
INDEMNITY

5.1              Indemnity.  (a)  Each Guarantor agrees to indemnify and hold harmless the Administrative Agent and each Secured Creditor and their respective successors, assigns, employees, agents and servants (individually an "Indemnitee," and collectively the "Indemnitees") from and against any and all claims, demands, losses, judgments and liabilities (including liabilities for penalties) of whatsoever kind or nature, and to reimburse each Indemnitee for all costs and expenses, including reasonable attorneys' fees, growing out of or resulting from this Agreement or the exercise by any Indemnitee of any right or remedy granted to it hereunder or under any Interest Rate Hedging Agreement or under any other Loan Document (but excluding any claims, demands, losses, judgments and liabilities or expenses to the extent incurred by reason of gross negligence or willful misconduct of such Indemnitee).  If and to the extent that the obligations of such Guarantor under this Section 5.1(a) are unenforceable for any reason, such Guarantor hereby agrees to make the maximum contribution to the payment and satisfaction of such obligations which is permissible under applicable law.

(b)         Without limiting the application of Section 5.1(a) hereof, each Guarantor agrees to pay, or reimburse the Administrative Agent for any and all reasonable fees, costs and expenses of whatever kind or nature incurred in connection with the creation, preservation or protection of the Administrative Agent's Liens on, and security interest in, the Collateral, including, without limitation, all reasonable fees and taxes in connection with the recording or filing of instruments and documents in public offices, payment or discharge of any taxes or Liens upon or in respect of the Collateral, premiums for insurance with respect to the Collateral and all other reasonable fees, costs and expenses in connection with protecting, maintaining or preserving the Collateral and the Administrative Agent's interest therein, whether through judicial proceedings or otherwise, or in defending or prosecuting any actions, suits or proceedings arising out of or relating to the Collateral.

(c)         Without limiting the application of Section 5.1(a) or (b) hereof, each Guarantor agrees to pay, indemnify and hold each Indemnitee harmless from and against any loss, costs, damages and expenses which such Indemnitee may suffer, expend or incur in consequence of or growing out of any misrepresentation by such Guarantor in this Agreement, any Interest Rate Protection or Other Hedging Agreement, any other Loan Document or in any writing contemplated by or made or delivered pursuant to or in connection with this Agreement, any Interest Rate Protection or Other Hedging Agreement or any other Loan Document.

(d)         If and to the extent that the obligations of any Guarantor under this Section 5.1 are unenforceable for any reason, each Guarantor hereby agrees to make the maximum contribution to the payment and satisfaction of such obligations which is permissible under applicable law.

5.2              Indemnity Obligations Secured by Collateral; Survival.  Any amounts paid by any Indemnitee as to which such Indemnitee has the right to reimbursement shall constitute Obligations secured by the Collateral prior to the release of the Collateral pursuant to the terms hereof.  The indemnity obligations of each Guarantor contained in this Article V shall continue in full force and effect notwithstanding the full payment of all the Notes issued under the Credit Agreement, the termination of all Interest Rate Protection or Other Hedging Agreements and the payment of all other Obligations (but excluding any unasserted contingent and indemnification obligations which survive the termination hereof) and notwithstanding the discharge thereof.

ARTICLE VI
DEFINITIONS

The following terms shall have the meanings herein specified.  Such definitions shall be equally applicable to the singular and plural forms of the terms defined.

"Account" shall have the meaning provided in the Uniform Commercial Code.

"Administrative Agent" shall have the meaning provided in the first paragraph of this Agreement.

"Agent" shall have the meaning provided in the first WHEREAS clause of this Agreement.

"Agreement" shall mean this Amended and Restated Security Agreement as the same may be modified, supplemented, extended, renewed, replaced, restated or amended from time to time in accordance with its terms.

"Guarantor" shall have the meaning provided in the first paragraph of this Agreement.

"Bank Creditor" shall have the meaning provided in the first paragraph of this Agreement.

"Borrower" shall have the meaning provided in the first WHEREAS clause of this Agreement.

"Chattel Paper" shall have the meaning provided in the Uniform Commercial Code.

"Class" shall have the meaning provided in Section 7.2 of this Agreement.

"Collateral" shall have the meaning provided in Section 1.1(a) of this Agreement.

"Contract Rights" shall mean all rights of a Guarantor (including, without limitation, all rights to payment) under each Contract.

"Contracts" shall mean all contracts between a Guarantor and one or more additional parties (including, without limitation, (i) each partnership agreement to which a Guarantor is a party and (ii) any Interest Rate Protection or Other Hedging Agreements), but excluding licenses, agreements and leases, which are immaterial to the operations of an Guarantor, to the extent that the terms thereof prohibit the assignment of, or granting of a security interest in, such licenses, agreements or leases.

"Copyrights" shall mean any United States copyright which a Guarantor now owns or hereafter acquires, including any registrations of any Copyrights in the United States Copyright Office, as well as any application for a United States copyright registration now or hereafter made with the United States Copyright Office by a Guarantor.

"Credit Agreement" shall have the meaning provided in the first WHEREAS clause of this Agreement.

"Credit Agreement Obligations" shall have the meaning provided in the definition of "Obligations" in this Article VI.

"Default" shall mean any event which, with notice or lapse of time, or both, would constitute an Event of Default.

"Deposit Accounts" shall have the meaning provided in the Uniform Commercial Code.

"Documents" shall have the meaning provided in the Uniform Commercial Code.

"Equipment" shall mean any "equipment," as such term is defined in the Uniform Commercial Code, now or hereafter owned by a Guarantor.

"Event of Default" shall mean any Event of Default under, and as defined in, the Credit Agreement and shall in any event, without limitation, include any payment default on any of the Obligations after the expiration of any applicable grace period.

"General Intangibles" shall have the meaning provided in the Uniform Commercial Code.

"Goods" shall have the meaning provided in the Uniform Commercial Code.

"Indemnitee" shall have the meaning provided in Section 5.1 of this Agreement.

"Instrument" shall have the meaning provided in Article 9 of the Uniform Commercial Code.

"Interest Rate Protection or Other Hedging Agreements" shall have the meaning provided in the first paragraph of this Agreement.

"Inventory" shall mean all "inventory" as such term is defined in the Uniform Commercial Code, now or hereafter owned by a Guarantor.

"Investment Property" shall have the meaning ascribed thereto in Article 9 of the UCC.

"LC Creditor" shall have the meaning provided in the first WHEREAS clause of this Agreement.

"Lenders" shall have the meaning provided in the first WHEREAS clause of this Agreement.

"Lenders" shall have the meaning provided in the first WHEREAS clause of this Agreement.

"Letter-of-Credit Rights" shall have the meaning provided in the Uniform Commercial Code.

"Marks" shall mean all right, title and interest in and to any trademarks and service marks and trade names now held or hereafter acquired by a Guarantor, which are registered in the United States Patent and Trademark Office or in any similar office or agency of the United States or any state thereof or any political subdivision thereof and any application for such trademarks and service marks, as well as any unregistered marks used by a Guarantor in the United States and trade dress including logos, designs, trade names, company names, business names, fictitious business names and other business identifiers in connection with which any of these registered or unregistered marks are used in the United States, but excluding all intent-to-use trademark applications for which an application to allege use under 15 U.S.C. §1051(c) and/or for which a statement of use under 15 U.S.C. §1051(d) has not been filed, which applications are identified in Annex D (III).

"Obligations" shall mean (i) the full and prompt payment when due (whether at the stated maturity, by acceleration or otherwise) of all obligations (including, without limitation, all "Obligations" as such term is defined in the Credit Agreement and all obligations which, but for the automatic stay under Section 362(a) of the Bankruptcy Code, would become due) and liabilities of Borrower and each Guarantor now existing or hereafter incurred under, arising out of or in connection with the Credit Agreement or any other Loan Document to which Borrower or any Guarantor is a Party and the due performance and compliance by Borrower and each Guarantor with all of the terms, conditions and agreements contained in each such Loan Document (all such obligations and liabilities being herein collectively called the "Credit Agreement Obligations"); (ii) the full and prompt payment when due (whether at the stated maturity, by acceleration or otherwise) of all obligations (including obligations which, but for the automatic stay under Section 362(a) of the Bankruptcy Code, would become due) and liabilities of Borrower now existing or hereafter incurred under, arising out of or in connection with (x) any Interest Rate Protection or Other Hedging Agreement, whether such Interest Rate Protection or Other Hedging Agreement is now in existence or hereafter arising and the due performance and compliance by Borrower with all of the terms, conditions and agreements contained therein and (y) the US Bank Letter of Credit Facility up to a maximum amount of $2,000,000 (provided that at no time shall there be more than $2,000,000 under the US Bank Letter of Credit Facility secured by the Security Documents) (all such obligations and liabilities described in this clause (ii) being herein collectively called the "Other Obligations"); (iii) any and all sums advanced by the Administrative Agent in order to preserve the Collateral or preserve its security interest in the Collateral; (iv) in the event of any proceeding for the collection or enforcement of any indebtedness, obligations, or liabilities of Borrower or any Guarantor referred to in clauses (i) and (ii), after an Event of Default shall have occurred and be continuing, the reasonable expenses of taking, holding, preparing for sale or lease, selling or otherwise disposing of or realizing on the Collateral, or of any exercise by the Administrative Agent of its rights hereunder, together with reasonable attorneys' fees and court costs; and (v) all amounts paid by any Indemnitee as to which such Indemnitee has the right to reimbursement under Section 6.1 of this Agreement.  It is acknowledged and agreed that the "Obligations" shall include extensions of credit of the types described above, whether outstanding on the date of this Agreement or extended from time to time after the date of this Agreement.

"Other Creditors" shall have the meaning provided in the first paragraph of this Agreement.

"Other Obligations" shall have the meaning provided in the definition of "Obligations" in this Article VI.

"Patents" shall mean any United States patent now or hereafter owned by a Guarantor, as well as any application for a United States patent now or hereafter owned by such Guarantor, but excluding patents and applications for patents that such Guarantor is prohibited by written contract from assigning or granting a security interest in.

"Permitted Filings" shall mean any filing or similar item that was a matter of public record on October 12, 2001, with respect to Collateral secured by the Original Security Agreement, or on the date hereof, with respect to any other Collateral.  

"Primary Obligations" shall have the meaning provided in Section 4.4(b) of this Agreement.

"Pro Rata Share" shall have the meaning provided in Section 4.4(b) of this Agreement.

"Proceeds" shall have the meaning provided in the Uniform Commercial Code.

"Representative" shall have the meaning provided in Section 5.4(e) of this Agreement.

"Required Secured Creditors" shall mean (i) the Required Lenders (or, to the extent required by Article XI of the Credit Agreement, all of the Lenders) under the Credit Agreement so long as any Credit Agreement Obligations remain outstanding and (ii) in any situation not covered by preceding clause (i), the holders of a majority of the outstanding principal amount of the Other Obligations.

"Requisite Creditors" shall have the meaning provided in Section 7.2 of this Agreement.

"Secondary Obligations" shall have the meaning provided in Section 4.4(b) of this Agreement.

"Secured Creditors" shall have the meaning provided in the first paragraph of this Agreement.

"Termination Date" shall have the meaning provided in Section 7.9 of this Agreement.

"Trade Secrets" shall mean any know-how, technology, product formulations, procedures and product and manufacturing specifications or standards now or hereafter utilized by a Guarantor in such Guarantor's business.

"Uniform Commercial Code" or "UCC" shall mean the Uniform Commercial Code as now or hereafter in effect from time to time in the State of New York or any other applicable jurisdiction.

"US Bank Letter of Credit Facility" means that certain revolving letter of credit facility in effect on the date hereof pursuant to that certain Continuing Reimbursement Agreement for Commercial Letters of Credit, dated as of July 14, 2000 by and among the LC Creditor and the Borrower providing for commercial letters of credit; provided, however, that at no time shall there be more than a maximum amount of $2,000,000 under the US Bank Letter of Credit Facility secured by the Security Documents.

ARTICLE VII
MISCELLANEOUS

7.1              Notices.  All such notices and communications hereunder shall be sent or delivered in accordance with the terms of the Credit Agreement.

7.2              Waiver; Amendment.   None of the terms and conditions of this Agreement may be changed, waived, modified or varied in any manner whatsoever unless in writing duly signed by each Guarantor and the Administrative Agent (with the written consent of the Required Lenders, or to the extent required by Section 11.1 of the Credit Agreement, all the Lenders); provided, however, that any change, waiver, modification or variance affecting the rights and benefits of a single Class of Secured Creditors (and not all Secured Creditors in a like or similar manner) shall require the written consent of the Requisite Creditors of such affected Class.  For the purpose of this Agreement, the term "Class" shall mean each class of Secured Creditors, i.e., whether (i) the Bank Creditors as holders of the Credit Agreement Obligations or (ii) the Other Creditors as the holders of the Other Obligations; and the term "Requisite Creditors" of any Class shall mean each of (A) with respect to the Credit Agreement Obligations, the Required Lenders and (B) with respect to the Other Obligations, the holders of at least a majority of all obligations outstanding from time to time under the Interest Rate Protection Agreements or Other Hedging Agreements.

7.3              Obligations Absolute.   The obligations of each Guarantor hereunder shall remain in full force and effect without regard to, and shall not be impaired by, (a) any bankruptcy, insolvency, reorganization, arrangement, readjustment, composition, liquidation or the like of such Guarantor; (b) any exercise or non-exercise, or any waiver of, any right, remedy, power or privilege under or in respect of this Agreement, any other Loan Document or any Interest Rate Protection or Other Hedging Agreement except as specifically set forth in a waiver granted pursuant to Section 7.2 hereof; or (c) any amendment to or modification of any Loan Document or any Interest Rate Protection or Other Hedging Agreement or any security for any of the Obligations; whether or not such Guarantor shall have notice or knowledge of any of the foregoing.

7.4              Successors and Assigns.  This Agreement shall be binding upon the parties hereto and their respective successors and assigns and shall inure to the benefit of the Administrative Agent, each Secured Creditor and each Guarantor and their respective successors and assigns, provided that no Guarantor may transfer or assign any or all of its rights or obligations hereunder without the written consent of the Required Secured Creditors.  All agreements, statements, representations and warranties made by each Guarantor herein or in any certificate or other instrument delivered by such Guarantor or on its behalf under this Agreement shall be considered to have been relied upon by the Secured Creditors and shall survive the execution and delivery of this Agreement, the other Loan Documents and the Interest Rate Protection or Other Hedging Agreements regardless of any investigation made by the Secured Creditors or on their behalf.

7.5              Headings Descriptive.   The headings of the several sections of this Agreement are inserted for convenience only and shall not in any way affect the meaning or construction of any provision of this Agreement.

7.6              Severability.   Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating 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.

7.7              GOVERNING LAW.   THIS AGREEMENT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER THE LAWS OF THE STATE OF NEW YORK, AND FOR ALL PURPOSES SHALL BE CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS AND DECISIONS OF SAID STATE, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW.

7.8              Each Guarantor's Duties.  It is expressly agreed, anything herein contained to the contrary notwithstanding, that each Guarantor shall remain liable to perform all of the obligations, if any, assumed by it with respect to the Collateral and the Administrative Agent shall not have any obligations or liabilities with respect to any Collateral by reason of or arising out of this Agreement, nor shall the Administrative Agent be required or obligated in any manner to perform or fulfill any of the obligations of such Guarantor under or with respect to any Collateral.

7.9              Termination; Release.   (a)  After the Termination Date, this Agreement shall automatically terminate (provided that all indemnities set forth herein including, without limitation, in Section 5.1 hereof shall survive such termination) and the Administrative Agent, at the request and expense of the Guarantors, will execute and deliver to each Guarantor a proper instrument or instruments (including Uniform Commercial Code termination statements on form UCC-3) acknowledging the satisfaction and termination of this Agreement, and will duly assign, transfer and deliver to each Guarantor (without recourse and without any representation or warranty) such of the Collateral of such Guarantor as has not theretofore been sold or otherwise applied or released pursuant to this Agreement.  As used in this Agreement, "Termination Date" shall mean the date upon which all Interest Rate Protection or Other Hedging Agreements have been terminated, no Note under the Credit Agreement is outstanding (and all Loans have been repaid in full), all Letters of Credit have been terminated and all Obligations (as defined in the Credit Agreement) then outstanding (other than any indemnities described in Section 5.1 hereof and in Section 11.4 of the Credit Agreement with respect to which no claim has been asserted) have been paid in full in cash.

(b)         In the event that any part of the Collateral is sold or otherwise disposed of in connection with a sale or other disposition permitted by Section 8.7 of the Credit Agreement or is otherwise released at the direction of the Required Lenders (or all the Lenders if required by Section 11.1 of the Credit Agreement) and the proceeds of such sale or sales or from such release are applied in accordance with the provisions of Section 4.4 of the Credit Agreement, to the extent required to be so applied, such Collateral will be sold free and clear of the Liens created by this Agreement and the Administrative Agent, at the request and expense of the Guarantors, will duly assign, transfer and deliver to the relevant Guarantor (without recourse and without any representation or warranty) such of the Collateral as is then being (or has been) so sold or released and has not theretofore been released pursuant to this Agreement.  The Administrative Agent shall also be entitled to and is hereby authorized and directed to duly assign, transfer and deliver such of the Collateral as provided in Section 11.20(b) of the Credit Agreement.

(c)         At any time that an Guarantor desires that the Administrative Agent take any action to acknowledge or give effect to any release of Collateral pursuant to the foregoing Section 7.9(a) or (b), as the case may be, it shall deliver to the Administrative Agent a certificate signed by an Authorized Officer stating that the release of the respective Collateral is permitted pursuant to Section 7.9(a) or (b), as the case may be.

(d)         The Administrative Agent shall have no liability whatsoever to any Secured Creditor as a result of any release of Collateral by it in accordance with this Section 7.9.

7.10          Counterparts.  This Agreement may be executed in any number of counterparts and by the different parties hereto on separate counterparts, each of which when so executed and delivered shall be an original, but all of which shall together constitute one and the same instrument.  A set of counterparts executed by all the parties hereto shall be lodged with each Guarantor and the Administrative Agent.

7.11          The Administrative Agent.  The Administrative Agent will hold in accordance with this Agreement all items of the Collateral at any time received under this Agreement.  It is expressly understood and agreed by the parties hereto and each Secured Creditor, by accepting the benefits of this Agreement, acknowledges and agrees that the obligations of the Administrative Agent as holder of the Collateral and interests therein and with respect to the disposition thereof, and otherwise under this Agreement, are only those expressly set forth in this Agreement and as provided in the Uniform Commercial Code in the State of New York.   The Administrative Agent shall act hereunder on the terms and conditions set forth in Article IX and Section 11.18 of the Credit Agreement.

7.12          US Bank.  (a) US Bank as LC Creditor under the US Bank Letter of Credit Facility and in its capacity as a Secured Party hereunder hereby irrevocably designates and appoints Bankers Trust Company as Administrative Agent under this Agreement and irrevocably authorizes Bankers Trust Company to act as its Administrative Agent and to take such action on its behalf under the provisions of this Agreement and to exercise such powers and perform such duties as are expressly delegated to the Administrative Agent under this Agreement and the Loan Documents, together with such other powers as are reasonably incidental thereto.  Notwithstanding any provision to the contrary in this Agreement, the Administrative Agent shall not have any duties or responsibilities with respect to US Bank in its capacity LC Creditor under the US Bank Letter of Credit Facility or any fiduciary relationship with US Bank, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this Agreement or otherwise exist against the Administrative Agent.

            (b)            For avoidance of doubt, US Bank expressly acknowledges that all rights and remedies of the Administrative Agent hereunder shall be exercised by the Administrative Agent in accordance with the applicable provisions of the Credit Agreement, and no consent of, or notice to, US Bank shall be required with respect thereto and US Bank shall not undertake any separate action with respect to the Collateral.  The sole right of US Bank hereunder shall be to receive its proportionate share of any proceeds received by the Administrative Agent hereunder in accordance with the terms hereof.  

7.13          Additional Guarantors.   It is understood and agreed that any Subsidiary of Borrower that is required to become a party to this Agreement after the Restatement Date pursuant to Section 7.12 of the Credit Agreement shall automatically become a party hereunder upon the execution and delivery by such Subsidiary of an instrument in the form of Exhibit A hereto and the delivery of same to the Administrative Agent, with the same force and effect as if originally named as a party herein.  The execution and delivery of any instrument adding an additional party to this Agreement shall not require the consent of any party hereunder or of any Secured Creditor.  The rights and obligations of each party hereunder shall remain in full force and effect notwithstanding the addition of any new party hereto.

7.14          Amended and Restated.   This Agreement amends and restates the Subsidiary Guarantor Security Agreement, dated October 12, 2001, among Deutsche Bank Trust Company Americas, U.S. Bank National Association, Vision-Ease Lens, Inc. and Vision-Ease Lens Azusa, Inc. (the "Original Subsidiary Guarantor Security Agreement") and is not in satisfaction of payment of any obligations thereunder and does not constitute a novation of the Original Subsidiary Guarantor Security Agreement but rather shall relate back to the time of the Original Subsidiary Guarantor Security Agreement for the purposes of filing and perfection.

ARTICLE VIII
SPECIAL PROVISIONS CONCERNING ACCOUNTS; CONTRACT RIGHTS; INSTRUMENTS

8.1              Additional Representations and Warranties.  As of the time when each of its Accounts arises, each Guarantor shall be deemed to have represented and warranted that such Account, and all records, papers and documents of each Guarantor relating thereto (if any) are genuine and in all material respects what they purport to be, and that all papers and documents of Guarantor (if any) relating thereto to the best knowledge of each Guarantor (i) will represent the genuine, legal, valid and binding obligation of the account debtor evidencing indebtedness unpaid and owed by the respective account debtor arising out of the performance of labor or services or the sale or lease and delivery of the merchandise listed therein, or both, (ii) will be the only original writings of Guarantor and embodying such obligation of the account debtor named therein (other than copies created for general accounting purposes), (iii) will evidence true and valid obligations, enforceable in accordance with their respective terms subject to applicable bankruptcy, insolvency, reorganization, moratorium and general principles of equityand (iv) will be in material compliance and will conform in all material respects with all applicable federal, state and local laws and applicable laws of any relevant foreign jurisdiction.

8.2              Maintenance of Records.  Each Guarantor will keep and maintain at its own cost and expense accurate and complete records of its Accounts and Contracts, including, but not limited to, records of all payments received, all credits granted thereon, all merchandise returned and all other dealings therewith, and such Guarantor will make the same available on such Guarantor's premises to the Administrative Agent for inspection, at such Guarantor's own cost and expense (not to exceed reasonable costs and expenses), at any and all reasonable times upon prior notice to an Responsible Officer of such Guarantor.  At the request of the Administrative Agent and upon the occurrence and during the continuance of an Event of Default, each Guarantor shall, at its own cost and expense, deliver all tangible evidence of its Accounts and Contract Rights (including, without limitation, all documents evidencing the Accounts and all Contracts) and such books and records to the Administrative Agent or to its representatives (copies of which evidence and books and records may be retained by such Guarantor).  Upon the occurrence and during the continuance of an Event of Default, if the Administrative Agent so directs, each Guarantor shall legend, in form and manner reasonably satisfactory to the Administrative Agent, the Accounts and the Contracts, as well as books, records and documents of such Guarantor evidencing or pertaining to such Accounts and Contracts with an appropriate reference to the fact that the Administrative Agent and that the Administrative Agent has a security interest therein.

8.3              Modification of Terms; etc.  No Guarantor shall rescind or cancel any indebtedness evidenced by any Account or under any Contract, or modify any term relating to such indebtedness or make any adjustment with respect thereto, or extend or renew the same, or compromise or settle any material dispute, claim, suit or legal proceeding relating thereto, or sell any Account or Contract, or interest therein, without the prior written consent of the Administrative Agent (not to be unreasonably withheld or delayed), except as permitted by Section 8.4 hereof or the Credit Agreement.  Each Guarantor will duly fulfill in all material respects all obligations on its part to be fulfilled under or in connection with the Accounts and Contracts and will do nothing to impair the rights of the Administrative Agent in the Accounts or Contracts.

8.4              Collection.   Each Guarantor shall endeavor to cause to be collected from the account debtor named in each of its Accounts or obligor under any Contract, as and when due (including, without limitation, amounts which are delinquent, such amounts to be collected in accordance with sound business judgement) any and all amounts owing under or on account of such Account or Contract, and apply forthwith upon receipt thereof all such amounts as are so collected to the outstanding balance of such Account or under such Contract, except that, unless an Event of Default has occurred and is continuing, each Guarantor may allow in the ordinary course of business as adjustments to amounts owing under its Accounts and Contracts (i) an extension or renewal of the time or times of payment, or settlement for less than the total unpaid balance, which such Guarantor finds appropriate in accordance with sound business judgment and (ii) a refund or credit due as a result of returned or damaged merchandise or improperly performed services or for other reasons which such Guarantor finds appropriate in accordance with sound business judgment.  The reasonable costs and expenses (including, without limitation, reasonable attorneys' fees) of collection, whether incurred by a Guarantor or the Administrative Agent, shall be borne by such Guarantor.

8.5              Instruments.  If any Guarantor owns or acquires any Instrument constituting Collateral, such Guarantor will within 15 days notify the Administrative Agent thereof, and upon request by the Administrative Agent will promptly deliver such Instrument to the Administrative Agent appropriately endorsed to the order of the Administrative Agent as further security hereunder.

8.6              Further Actions.   Each Guarantor will, at its own expense, make, execute, endorse, acknowledge, file and/or deliver to the Administrative Agent from time to time such vouchers, invoices, schedules, confirmatory assignments, conveyances, financing statements, transfer endorsements, powers of attorney, certificates, reports and other assurances or instruments and take such further steps relating to its Accounts, Contracts, Instruments and other property or rights covered by the security interest hereby granted, as the Administrative Agent may reasonably require.

ARTICLE IX
SPECIAL PROVISIONS CONCERNING MARKS

9.1              Additional Representations and Warranties.  Each Guarantor represents and warrants that it is the true and lawful exclusive owner of or otherwise has the right to use the Marks listed in Annex D(I) and D(II) hereto for such Guarantor and that said listed Marks include all the United States federal trademark registrations or applications registered in the United States Patent and Trademark Office.  Each Guarantor represents and warrants that it owns or is licensed to use or is not prohibited from using all Marks that it uses.  Each Guarantor further warrants that, except as set forth in Annex D(IV), it is aware of no third party claim that any aspect of such Guarantor's present or contemplated business operations infringes or will infringe any Mark.  Each Guarantor represents and warrants that it is the owner of record of or otherwise has the right to use all United States registrations and applications listed in Annex D(I) and D(II) hereto and that said registrations are valid, subsisting, have not been canceled and that, except as set forth in Annex D(IV), No Guarantor is aware of any third-party claim that any of said registrations is invalid or unenforceable.  Each Guarantor hereby grants to the Administrative Agent an absolute power of attorney to sign, upon the occurrence and during the continuance of an Event of Default, any document which may be required by the United States Patent and Trademark Office in order to effect an absolute assignment of all right, title and interest in each Mark and associated goodwill, and record the same.

9.2              Licenses and Assignments.  Other than the license agreements listed on Annex E hereto and any extensions or renewals thereof, each Guarantor hereby agrees not to divest itself of any right under any Mark absent prior written approval of the Administrative Agent (which shall not be unreasonably withheld or delayed), except that such Guarantor may license any of its rights in such a Mark in the ordinary course of business provided that such license does not materially interfere with the business of such Guarantor.

9.3              Infringements.   Each Guarantor agrees, promptly upon learning thereof, to notify the Administrative Agent in writing of the name and address of, and to furnish such pertinent information that may be available with respect to (except for any privileged communication), any party who may be infringing or otherwise violating any of such Guarantor's rights in and to any Mark to the extent that such Guarantor reasonably believes that such infringement or violation is material to its business, or with respect to any party claiming that Borrower's use of any Mark violates any property right of that party.  Each Guarantor further agrees, if consistent with good business practice and unless otherwise agreed by the Administrative Agent, to diligently prosecute any Person infringing any Mark to the extent that such Guarantor reasonably believes that such infringement is material to its business.

9.4              Preservation of Marks.   Each Guarantor agrees to use its Marks in interstate commerce during the time in which this Agreement is in effect, sufficiently to preserve such Marks as trademarks or service marks registered under the laws of the United States; provided that, to the extent permitted by the Credit Agreement, no Guarantor shall be obligated to preserve any Mark in the event such Guarantor determines, in its reasonable business judgment, that the preservation of such Mark is no longer desirable in the conduct of its business.

9.5              Maintenance of Registration.  Each Guarantor shall, at its own expense, diligently process all documents required by the Trademark Act of 1946, 15 U.S.C. §§ 1051 et seq. to maintain trademark registrations, including but not limited to affidavits of use and applications for renewals of registration in the United States Patent and Trademark Office for all of its Marks pursuant to 15 U.S.C. §§ 1058(a), 1059 and 1065, and shall pay all fees and disbursements in connection therewith and shall not abandon any such filing of affidavit of use or any such application of renewal prior to the exhaustion of all reasonable administrative and judicial remedies without prior written consent of the Administrative Agent (which consent will not be unreasonably withheld or delayed) except if, in its reasonable business judgment, such action is no longer desirable in the conduct of its business.

9.6              Future Registered Marks.  If any Mark registration issues hereafter to a Guarantor as a result of any application now or hereafter pending before the United States Patent and Trademark Office, within 60 days of receipt of such certificate, such Guarantor shall deliver to the Administrative Agent a copy of such certificate, and a grant of security in such Mark to the Administrative Agent, confirming the grant thereof hereunder, the form of such confirmatory grant to be substantially the same as the form hereof.

9.7              Remedies.  If an Event of Default shall occur and be continuing, the Administrative Agent may, by written notice to the Guarantors, take any or all of the following actions:  (i) declare the entire right, title and interest of each Guarantor in and to each of such Guarantor's Marks together with the goodwill of the business associated therewith, together with all trademark rights and rights of protection to the same, vested in the Administrative Agent for the benefit of the Secured Creditors, in which event such rights, title and interest shall immediately vest, in the Administrative Agent for the benefit of the Secured Creditors, in which case the Administrative Agent shall be entitled to exercise the power of attorney referred to in Section 9.1 to execute, cause to be acknowledged and notarized and record said absolute assignment with the applicable agency; (ii) take and use or sell the Marks together with the goodwill of such Guarantor's business symbolized by the Marks and the right to carry on the business and use the assets of such Guarantor in connection with which the Marks have been used; and (iii) direct such Guarantor to refrain, in which event such Guarantor shall refrain, from using the Marks in any manner whatsoever, directly or indirectly, and, if requested by the Administrative Agent, change such Guarantor's corporate name to eliminate therefrom any use of any Mark and execute such other and further documents that the Administrative Agent may request to further confirm this and to transfer ownership of the Marks and any registrations and any trademark application in the United States Patent and Trademark Office or any equivalent government agency or office in any foreign jurisdiction to the Administrative Agent.

ARTICLE X
SPECIAL PROVISIONS CONCERNING PATENTS AND COPYRIGHTS AND TRADE SECRETS

10.1          Additional Representations and Warranties.  Each Guarantor represents and warrants that it is the true and lawful exclusive owner of or otherwise has the right to use (i) all material Trade Secrets necessary to operate the business of such Guarantor, (ii) the Patents listed in Annex F hereto for such Guarantor and (iii) the Copyrights listed in Annex G hereto for such Guarantor, that to the best of its knowledge said Patents include all the United States patents and applications for United States patents that such Guarantor now owns or otherwise has the right to use (except for any patent that such Guarantor does not have the right to assign or grant a security interest in) and that said Copyrights constitute all the United States copyrights registered with the United States Copyright Office and applications for United States copyrights that such Guarantor now owns or otherwise has the right to use and that in each case are necessary in the conduct of the business of such Guarantor.  Each Guarantor represents and warrants that it owns or is licensed to practice under all Patents and Copyrights that it now uses or practices under.  Each Guarantor further warrants that, except as set forth in Schedule F(I), it is aware of no third party claim that any aspect of such Guarantor's present or contemplated business operations infringes or will infringe any patent or any copyright or which such Guarantor has misappropriated any Trade Secrets or proprietary information.  Each Guarantor hereby grants to the Administrative Agent an absolute power of attorney to sign, upon the occurrence and during the continuance of any Event of Default, any document which may be required by the United States Patent and Trademark Office or the United States Copyright Office in order to effect an absolute assignment of all right, title and interest in each Patent and Copyright, and record the same.

10.2          Licenses and Assignments.  Other than the license agreements listed on Annex E hereto and any extensions or renewals thereof, Each Guarantor hereby agrees not to divest itself of any right under any Patent or Copyright absent prior written approval of the Administrative Agent except that such Guarantor may license any of its rights to such Patent or Copyright in the ordinary course of business provided that such license does not materially interfere with the business of such Guarantor or any Subsidiary consistent with past practices or as is consistent with its existing licensing strategy.

10.3          Infringements.   Each Guarantor agrees, promptly upon learning thereof, to furnish the Administrative Agent in writing with all pertinent information (except for any privileged information)available to such Guarantor with respect to any infringement or other violation of such Guarantor's rights in and to any Patent or Copyright to the extent that such Guarantor reasonably believes that such infringement or violation is material to its business, or with respect to any claim that practice of any Patent or Copyright violates any property right of a third party, or with respect to any misappropriation of any Trade Secret by such Guarantor or any claim that such Guarantor's practice of any Trade Secret violates any property right of a third party.   Each Guarantor further agrees, consistent with good business practice and absent direction of the Administrative Agent to the contrary, diligently to prosecute any Person infringing any Patent or Copyright or any Person misappropriating any of such Guarantor's Trade Secrets to the extent that such Guarantor reasonably believes that such infringement or misappropriation is material to its business.

10.4          Maintenance of Patents.  At its own expense, each Guarantor shall make timely payment of all post-issuance fees required pursuant to 35 U.S.C. § 41 to maintain in force rights under each Patent except if, in its reasonable business judgment, such maintenance of such Patent is no longer desirable in the conduct of its business.

10.5          Prosecution of Patent Application.  At its own expense, each Guarantor shall diligently prosecute all applications for Patents listed in Annex F hereto for such Guarantor and shall not abandon any such application prior to exhaustion of all reasonable administrative and judicial remedies, absent written consent of the Administrative Agent; provided, however, that to the extent permitted by the Credit Agreement, no Guarantor shall be obligated to prosecute any application in the event such Guarantor determines, in its reasonable business judgment, that the prosecuting of such application is no longer necessary or desirable in the conduct of its business.

10.6          Other Patents and Copyrights.  Within 60 days of its acquisition of a Patent or Copyright, or of its filing of an application for a Patent or Copyright, each Guarantor shall deliver to the Administrative Agent a copy of said Patent or Copyright or such application, as the case may be, with a grant of security as to such Patent or Copyright, as the case may be, confirming the grant thereof hereunder, the form of such confirmatory grant to be substantially the same as the form hereof.

10.7          Remedies.  If an Event of Default shall occur and be continuing, the Administrative Agent may by written notice to Guarantors, take any or all of the following actions:  (i) declare the entire right, title, and interest of Guarantors in each of the Patents and Copyrights vested in the Administrative Agent for the benefit of the Secured Creditors, in which event such right, title, and interest shall immediately vest in the Administrative Agent for the benefit of the Secured Creditors, in which case the Administrative Agent shall be entitled to exercise the power of attorney referred to in Section 10.1 hereof to execute, cause to be acknowledged and notarized and record said absolute assignment with the applicable agency; (ii) take and practice or sell the Patents and Copyrights; and (iii) direct Guarantors to refrain, in which event each Guarantor shall refrain, from practicing the Patents and using the Copyrights directly or indirectly, and each Guarantor shall execute such other and further documents as the Administrative Agent may request further to confirm this and to transfer ownership of the Patents and Copyrights to the Administrative Agent for the benefit of the Secured Creditors.

[Signature Page Follows]

                        IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed and delivered by their duly authorized officers as of the date first above written.

VISION-EASE LENS, INC.,
as Guarantor

                        By:  /s/ Bradley D. Carlson

                        Name:  Bradley D. Carlson

                        Title:  Treasurer

VISION-EASE LENS AZUSA, INC.,
as Guarantor

                        By:  /s/ Bradley D. Carlson

                        Name:  Bradley D. Carlson

                        Title:  Treasurer

DEUTSCHE BANK TRUST COMPANY AMERICAS,
(formerly named Bankers Trust Company),
 as Administrative Agent

                        By:  /s/ Mary Jo Jolly

                        Name:  Mary Jo Jolly

                        Title:  Assistant Vice President

U.S. BANK NATIONAL ASSOCIATION

                        By:  /s/ Nicholas G. Myers

                        Name:  Nicholas G. Myers

                        Title:  Assistant Vice President

EX-10.50 6 ramsey-mortgage_amendment.htm

FIRST AMENDMENT TO MORTGAGE

This FIRST AMENDMENT TO MORTGAGE (this "Amendment"), effective as of September 27, 2002, is made by and between VISION-EASE LENS, INC., a Minnesota corporation (the "Mortgagor"), having an office at One Meridian Crossings, Suite 850, Minneapolis, Minnesota 55423, and DEUTSCHE BANK TRUST COMPANY AMERICAS (formerly named Bankers Trust Company), as administrative agent for the Lenders (in such capacity, hereinafter, the "Mortgagee") and as a Lender, having an office at 130 Liberty Street, New York, New York 10006.

WITNESSETH:

WHEREAS, Mortgagor executed in favor of Bankers Trust Company (now named Deutsche Bank Trust Company Americas), as Administrative Agent, that certain Mortgage, Assignment of Leases and Rents and Fixture Filing (the "Mortgage") dated as of October 12, 2001 and recorded October 15, 2001 with the Office of the Clerk and Recorder of Anoka County, Minnesota as Document No. 1610955, relating to the real estate legally described on Exhibit A attached hereto and made a part hereof (the "Property");

WHEREAS, Mortgagor, Mortgagee, certain banks and financial institutions party thereto and Bank One, N.A., as "Documentation Agent" have entered into that certain Third Amended and Restated Credit Agreement of even date herewith (the "Third Amended and Restated Credit Agreement"), further amending and restating that certain Credit Agreement (as defined in the Mortgage); and

WHEREAS, in connection with the Third Amended and Restated Credit Agreement, Mortgagor and Mortgagee desire to amend the Mortgage in certain respects as hereinafter provided. All capitalized terms not specifically defined herein shall have the respective meanings given or ascribed to them in the Mortgage or, if not defined in the Mortgage, the Third Amended and Restated Credit Agreement.

NOW THEREFORE, for Ten Dollars ($10.00) and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Mortgagor and Mortgagee hereby agree as follows:

1.          Effective Date. The terms and provisions of this Amendment shall become effective as of the date hereof (the "Effective Date").

2.           Amendment of "Mortgagee". All references to "Mortgagee" in the Mortgage shall hereinafter refer to Deutsche Bank Trust Company Americas (formerly named Bankers Trust Company) as administrative agent for the Lenders and as a Lender.

3.           Replacement of Paragraph 35. Paragraph 35 of the Mortgage is hereby deleted in its entirety and replaced with the following:

"35.     Maturity Date. The latest obligation secured by this Mortgage matures on May 14, 2004."

4.           Severability. If any provision of this Amendment is held to be illegal, invalid or unenforceable under present or future laws, such provision shall be fully severable and this Amendment shall be construed and enforced as if such illegal, invalid or unenforceable provision had never comprised a part hereof, and the remaining provisions hereof or thereof shall remain in full force and effect and shall not be affected by the illegal, invalid or unenforceable provision which shall be construed as similar in terms as may be possible while remaining legal, valid and enforceable.

5.           Successors and Assigns. This Amendment shall be binding upon Mortgagor and its successors and assigns, and shall inure to the benefit of Mortgagee and its successors and assigns.

6.           Governing Law. This Amendment shall be governed by and shall be construed and enforced in accordance with the internal laws of the State of Minnesota (without regard to conflicts of law principles) and applicable laws of the United States.

7.           Counterparts. This Amendment may be executed in one or more counterparts, each of which shall constitute an original, but all of which together shall constitute one and the same instrument.

8.           Headings. The headings of sections and paragraphs in this Amendment are for convenience and reference only and shall not be construed in any way to limit or define the content, scope, or intent of the provisions.

9.           Reaffirmation of Mortgage. Except as specifically modified by this Amendment, all other terms of the Mortgage shall remain in full force and effect. Any and all references in the Mortgage to the "Mortgage" shall mean the Mortgage, as amended by this Amendment.

[Signature and Notary Pages Follow]

    IN WITNESS WHEREOF, Mortgagor and Mortgagee have executed this Amendment intending same to be effective as of the date first written above.

MORTGAGOR:

VISION-EASE LENS, INC., a Minnesota corporation

By: /s/ Bradley D. Carlson
Name: Bradley D. Carlson
Title: Treasurer

MORTGAGEE:

DEUTSCHE BANK TRUST COMPANY AMERICAS (formerly named Bankers Trust
Company), as administrative agent for the
Lenders and as a Lender

By: /s/ Mary Jo Jolly
Name: Mary Jo Jolly
Title: Assistant Vice President

STATE OF MINNESOTA	)
	)	ss.
COUNTY OF HENNEPIN	)

The foregoing instrument was acknowledged before me this 7th day of August, 2002, by Bradley D. Carlson, the Treasurer of Vision-Ease Lens, Inc., a Minnesota corporation, on behalf of said corporation.

/s/ Julie K. Uhrich
Notary Public

STATE OF NEW YORK	)
	)	ss.
COUNTY OF NEW YORK	)

The foregoing instrument was acknowledged before me this 27th day of September, 2002, by Mary Jo Jolly, the Assistant Vice President of Deutsche Bank Trust Company Americas (formerly named Bankers Trust Company), on behalf of said entity.

/s/ Mary E. Somoza
Notary Public

THIS INSTRUMENT WAS
PREPARED BY AND AFTER
RECORDING SHOULD BE
RETURNED TO:

Winston & Strawn
35 West Wacker Drive
Chicago, Illinois 60601
Attn: Ankur Gupta, Esq.

EXHIBIT A
TO
FIRST AMENDMENT TO MORTGAGE

Mortgagor:       VISION-EASE LENS, INC., a Minnesota corporation

Mortgagee: DEUTSCHE BANK TRUST COMPANY AMERICAS (formerly named Bankers Trust Company), as administrative agent for the Lenders and as a Lender

The Land described in the referenced instrument is located in Anoka County, Minnesota, and is described as follows:

    Lot 1, Block 1, A.E.C. Energy Park Second Addition, according to the recorded plat thereof, in the County of Anoka, State of Minnesota.

EX-10.51 7 cortland_mortgage.htm

PRINCIPAL AMOUNT  

SECURED $145,000,000.00

MORTGAGE, ASSIGNMENT OF LEASES AND RENTS,

AND SECURITY AGREEMENT

THIS MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, AND SECURITY AGREEMENT, dated as of the 27th day of September, 2002 (the "Mortgage"), is executed and delivered by BMC INDUSTRIES, INC., a Minnesota corporation ("BMC"), and CORTLAND COUNTY INDUSTRIAL DEVELOPMENT AGENCY, a public benefit corporation existing under the laws of the State of New York (the "Agency"), (BMC and the Agency hereafter collectively referred to as "Mortgagor"), to DEUTSCHE BANK TRUST COMPANY AMERICAS (formerly known as Bankers Trust Company), not individually, but solely in its capacity as Administrative Agent under the Credit Agreement (as defined below) (the "Mortgagee").

Recitals

 WHEREAS, BMC is the holder of the fee simple title to the Premises (defined below);

WHEREAS, the Agency is the holder of leasehold estates in the Premises pursuant to that certain Lease to Agency dated as of February 1, 1999, together with all options to renew, extend or purchase (including rights of first refusal) now or hereafter contained therein (the "Underlying Lease") by and between BMC, as landlord, and the Agency, as tenant, which Underlying Lease has been memorialized of record by that certain Memorandum of Underlying Lease by and between BMC and the Agency dated as of February 1, 1999 and recorded on February 25, 1999 as Instrument No. 1999-1008, and that certain Lease to Agency dated as of July 1, 1996, together with all options to renew, extend or purchase (including rights of first refusal) now or hereafter contained therein (the "1996 Lease") by and between BMC, as landlord, and the Agency, as tenant, which 1996 Lease, as further evidenced by that certain Memorandum of Underlying Lease by and between BMC and the Agency dated as of July 1, 1996 (unrecorded);

WHEREAS, BMC, Mortgagee, NBD Bank, as Documentation Agent, and certain other lenders have entered into that certain Credit Agreement dated as of May 15, 1998 (the "Original Credit Agreement"), as the same was amended and restated as of June 25, 1998, and as the same was previously amended prior to that date hereof (the "First Amended and Restated Credit Agreement");

WHEREAS, BMC, Mortgagee, Documentation Agent and the financial institutions parties thereto have entered into that certain Second Amendment and Restatement Agreement dated as of October 12, 2001 (the "Second Amendment and Restatement Agreement"), amending and restating the First Amended and Restated Credit Agreement;

WHEREAS, pursuant to that certain Third Amended and Restated Credit Agreement, dated as of the date hereof, the First Amended and Restated Credit Agreement (as previously amended by the Second Amendment and Restatement Agreement) was further amended (as used herein, the term "Credit Agreement" means the First Amended and Restated Credit Agreement, as in effect on the date hereof and as amended by that certain Second Amendment and Restatement Agreement described above and as amended by that certain Third Amended and Restated Credit Agreement described above, as the same may be amended, modified, extended, renewed, replaced, restated or supplemented from time to time, and including any agreement extending the maturity of or restructing of all or any portion of the Indebtedness (as hereinafter defined) under such agreement or any successor agreements), and the financial institutions party thereto have severally agreed to make certain extensions of credit to or for the benefit of BMC upon the terms and conditions set forth therein;

WHEREAS, pursuant to the terms of the Credit Agreement, the obligations of BMC under the Credit Agreement and the other Loan Documents (as hereinafter defined) shall be secured by, among other things, a lien upon and perfected security interest in all estate, right, title and interest of the Mortgagor in and to the Mortgaged Property (as hereinafter defined) pursuant to the terms hereof;

WHEREAS, terms used but not defined in this Mortgage have the meanings given to them in the Credit Agreement;

NOW, THEREFORE, to secure (a) payment of the Notes, with interest thereon, (b) performance of BMC's obligations under the Loan Documents insofar as they relate to the Notes or guarantee repayment of the Notes, (c) payment by BMC to Mortgagee of all sums expended or advanced by Mortgagee pursuant to any covenant, term, or provision of this Mortgage, and (d) performance of each covenant, term and provision by BMC to be performed pursuant to this Mortgage (clauses (a)-(d) hereafter collectively referred to as the "Indebtedness"), and provided that the maximum principal indebtedness secured hereby shall never exceed $145,000,000, Mortgagor hereby mortgages, grants, conveys, warrants, pledges, assigns, and hypothecates unto Mortgagee, its successors and assigns, WITH THE POWER OF SALE, the real property described in Exhibit A attached hereto including, but not limited to, Mortgagor's interests in the Premises, (the "Premises"), and all of the buildings, structures, fixtures, additions, enlargements, extensions, modifications, repairs, replacements, and improvements now or hereafter located thereon (the "Improvements");

TOGETHER WITH all right, title, interest, and estate of Mortgagor now owned, or hereafter acquired, in and to the following property, rights, interests and estates (the Premises, the Improvements, and such property, rights, interests, and estates hereinafter described are collectively referred to as the "Mortgaged Property"):

GRANTING CLAUSE ONE

All easements, rights-of-way, strips and gores of land, streets, ways, alleys, passages, sewer rights, water, water courses, water rights and powers, air rights and development rights, all rights to oil, gas, minerals, coal and other substances of any kind or character, and all estates, rights, titles, interests, privileges, liberties, tenements, hereditaments and appurtenances of any nature whatsoever, in any way belonging, relating or pertaining to the Premises and the Improvements and the reversion and reversions, remainder and remainders, and all land lying in the bed of any street, road, highway, alley or avenue, opened, vacated or proposed, in front of or adjoining the Premises, to the center line thereof and all the estates, rights, titles, interests, dower and rights of dower, curtsey and rights of curtsey, property, possession, claim and demand whatsoever, both at law and in equity, of Mortgagor of, in and to the Premises and the Improvements and every part and parcel thereof, with the appurtenances thereto;

GRANTING CLAUSE TWO

All machinery, furniture, furnishings, equipment, computer software and hardware, fixtures (including, without limitation, all heating, air conditioning, plumbing, lighting, communications and elevator fixtures) and other property of every kind and nature, whether tangible or intangible, whatsoever owned by Mortgagor, or in which Mortgagor has or shall have an interest, now or hereafter located upon the Premises and the Improvements, or appurtenant thereto, and usable in connection with the present or future operation and occupancy of the Premises and the Improvements and all building equipment, materials and supplies of any nature whatsoever owned by Mortgagor, or in which Mortgagor has or shall have an interest, now or hereafter located upon the Premises and the Improvements, or appurtenant thereto, or usable in connection with the present or future operation, enjoyment and occupancy of the Premises and the Improvements (hereinafter collectively referred to as the "Equipment"), including any leases of any of the foregoing, any deposits existing at any time in connection with any of the foregoing, and the proceeds of any sale or transfer of the foregoing, and the right, title and interest of Mortgagor in and to any of the Equipment that may be subject to any "security interests" as defined in New York's Uniform Commercial Code (the "Uniform Commercial Code"), superior in lien to the lien of this Mortgage;

GRANTING CLAUSE THREE

Awards or payments, including interest thereon, that may heretofore and hereafter be made with respect to the Premises and the Improvements, whether from the exercise of the right of eminent domain or condemnation (including, without limitation, any transfer made in lieu of or in anticipation of the exercise of said rights), or for a change of grade, or for any other injury to or decrease in the value of the Premises and Improvements;

GRANTING CLAUSE FOUR

All leases and other agreements or arrangements heretofore or hereafter entered into affecting the use, enjoyment or occupancy of, or the conduct of any activity upon or in, the Premises and the Improvements, including any extensions, renewals, modifications or amendments thereof, but excluding the exercise by the Agency of the Agency's Reserved Rights (as hereinafter defined), (the "Leases") and all rents, rent equivalents, moneys payable as damages or in lieu of rent or rent equivalents, royalties (including, without limitation, all oil and gas or other mineral royalties and bonuses), income, receivables, receipts, revenues, deposits (including, without limitation, security, utility and other deposits), accounts, cash, issues, profits, charges for services rendered, and other consideration of whatever form or nature received by or paid to or for the account of or benefit of Mortgagor or its agents or employees from any and all sources arising from or attributable to the Premises and the Improvements, excluding, however, any moneys payable to the Agency pursuant to the Agency's Reserved Rights (the "Rents"), together with all proceeds from the sale or other disposition of the Leases and the right to receive and apply the Rents to the payment of the Obligations;

GRANTING CLAUSE FIVE

All proceeds of and any unearned premiums on any insurance policies covering the Mortgaged Property, including, without limitation, the right to receive and apply the proceeds of any insurance, judgments, or settlements made in lieu thereof, for damage to the Mortgaged Property;

GRANTING CLAUSE SIX

The right, in the name and on behalf of Mortgagor, to appear in and defend any action or proceeding brought with respect to the Mortgaged Property and to commence any action or proceeding to protect the interest of Mortgagee in the Mortgaged Property;

GRANTING CLAUSE SEVEN

All proceeds, products, offspring, rents and profits from any of the foregoing, including, without limitation, those from sale, exchange, transfer, collection, loss, damage, disposition, substitution or replacement of any of the foregoing.

TO HAVE AND TO HOLD the above granted and described Mortgaged Property, WITH THE POWER OF SALE, unto and to the use and benefit of Mortgagee, forever;

PROVIDED, HOWEVER, these presents are upon the express condition that, if BMC shall well and truly pay to Mortgagee the Indebtedness at the time and in the manner provided in the Notes and this Mortgage and shall well and truly abide by and comply with each and every covenant and condition set forth herein, in the Notes and in the other Loan Documents in a timely manner, these presents and the estate hereby granted shall cease, terminate and be void upon the full payment of the Indebtedness.

This Mortgage secures the payment of the Indebtedness in a principal amount not to exceed $145,000,000 (the "Secured Principal Amount"), together with interest and amounts that Mortgagee expends under this Mortgage in connection with (i) any taxes, charges or assessments that may be imposed by law upon the Mortgaged Property, (ii) premiums on insurance policies covering the Mortgaged Property, and (iii) expenses incurred in upholding the lien of this Mortgage, including the expenses of any litigation to prosecute or defend the rights and lien created by this Mortgage, all of the foregoing Indebtedness and obligations, collectively, the "Secured Indebtedness." Notwithstanding any provision in this Mortgage to the contrary, (a) until the Indebtedness is paid in full, this Mortgage secures the entire Indebtedness provided that the maximum principal Indebtedness secured hereby shall never exceed the Secured Principal Amount; (b) this Mortgage shall secure only the Indebtedness, taxes, charges, assessments, premiums, and expenses included within the foregoing definition of "Secured Indebtedness"; and (c) the Secured Principal Amount shall be reduced only by the last and final sums that Mortgagor repays, or is paid on its behalf, with respect to the principal of the Indebtedness and shall not be reduced by any intervening principal payments of the Indebtedness; such intervening principal payments shall instead be deemed to reduce only such portions of the Indebtedness first, as are unsecured, second, as are secured by other collateral other than real property located in New York State owned by BMC, third, as are secured by a subordinated lien on real property located in New York State owned by BMC, including the Mortgaged Property, which subordinated lien is subordinated to a first lien held on such real property by the Mortgagee.

Mortgagor represents and warrants to and covenants and agrees with Mortgagee as follows:

PART I

GENERAL PROVISIONS

1.         Payment of Indebtedness and Incorporation of Covenants, Conditions and Agreements.  BMC shall pay the Indebtedness at the time and in the manner provided in the Notes and in the other Loan Documents.  All the covenants, conditions and agreements contained in the Notes and any of the Loan Documents are hereby made a part of this Mortgage to the same extent and with the same force as if fully set forth herein.

2.         Warranty of Title.  BMC warrants that Mortgagor has good, marketable and insurable title to the Mortgaged Property and has the full power, authority and right to execute, deliver and perform its obligations under this Mortgage and to deed, encumber, mortgage, give, grant, bargain, sell, alienate, convey, confirm, pledge, assign and hypothecate the same and that Mortgagor possesses an unencumbered fee estate in the Premises and the Improvements and that it owns the Mortgaged Property free and clear of all liens, encumbrances and charges whatsoever except for certain utility easements which do not affect in any way Mortgagor's use of the Mortgaged Property and except as listed in Schedule B of the Cortland Mortgage Policy (the "Permitted Exceptions") and that this Mortgage is and will remain a valid and enforceable first lien on and security interest in the Mortgaged Property, subject only to said Permitted Exceptions.  BMC shall forever warrant, defend and preserve such title and the validity and priority of the lien of this Mortgage and shall forever warrant and defend the same to Mortgagee against the claims of all persons whomsoever.

3.         Insurance; Casualty.

BMC, at its sole cost and expense, will maintain insurance coverage with respect to the Mortgaged Property of the types and in the amounts required by the Credit Agreement.  If the Mortgaged Property shall be damaged or destroyed in whole or in part by casualty, BMC shall give prompt written notice to Mortgagee generally describing the nature and extent of such casualty, and all insurance proceeds to which Mortgagor may be entitled as a result of such casualty shall be distributed and applied in accordance with the Credit Agreement.

4.         Representations.  BMC hereby represents and warrants to Mortgagee as follows:

(a)       This Mortgage is in all respects a valid and legally binding obligation of BMC, enforceable in accordance with its terms.

(b)       The execution and delivery of this Mortgage and the performance and observance by BMC of its obligations hereunder will not contravene or result in a breach of (i) BMC's certificate of incorporation or by-laws, (ii) any governmental requirements, (iii) any decree or judgement binding on Mortgagor, or (iv) any agreement or instrument binding on Mortgagor or any of its properties, nor will the same result in the creation of any lien or security interest under any such agreement or instrument.

(c)       All utility services necessary and sufficient for the construction, development and operation of the Mortgaged Property for its intended purposes are presently available to the Premises through dedicated public rights of way or through perpetual private easements, approved by Mortgagee, with respect to which the Mortgage creates a valid, binding and enforceable lien, including, but not limited to, water supply, storm and sanitary sewer, gas, electric and telephone facilities, and drainage.

(d)       Neither the Mortgaged Property nor any portion thereof is now damaged or injured as result of any fire, explosion, accident, flood or other casualty or has been the subject of any taking, and, to the knowledge of BMC, no taking is pending or contemplated.

(e)       All federal, state and other tax returns of BMC with respect to the Mortgaged Property required by law to be filed have been filed; all federal, state and other taxes, assessments and other governmental charges upon BMC with respect to the Mortgaged Property which are due and payable have been paid; and BMC has set aside on its books provisions reasonably adequate for the payment of all such taxes for periods subsequent to the periods for which such returns have been filed.

(f)       BMC has made no contract or arrangement of any kind or type whatsoever (whether oral or written, formal or informal), the performance of which by the other party thereto could give rise to a lien or encumbrance on the Mortgaged Property, except for contracts (all of which have been disclosed in writing to Mortgagee) made by Mortgagor with parties who have executed and delivered lien waivers to BMC, and which, in the opinion of Mortgagee's counsel, will not create rights in existing or future lien claimants which may be superior to the lien of the Mortgage.

(g)       The rights of way for all roads necessary for the full utilization of the Improvements for their intended purposes have either been acquired by the Mortgagor, the appropriate governmental authority or have been dedicated to public use and accepted by such governmental authority, and all such roads shall have been completed, or all necessary steps shall have been taken by BMC and such governmental authority to assure the complete construction and installation thereof prior to the date upon which access to the Mortgaged Property via such roads will be necessary.  All curb cuts, driveway permits and traffic signals necessary for access to the Mortgaged Property after completion of the Improvements are existing or have been fully approved by the appropriate governmental authority.

(h)       No Event of Default (hereinbelow defined) exists and no event which but for the passage of time, the giving of notice or both would constitute an Event of Default has occurred.

(i)       The Permitted Exceptions do not and will not materially and adversely affect (1) the ability of BMC to pay in full the principal and interest on the Notes in a timely manner or (2) the use of the Mortgaged Property for the use currently being made thereof, the operation of the Mortgaged Property as currently being operated or the value of the Mortgaged Property.

(j)       Upon the execution by Mortgagor and the recording of this Mortgage, and upon the execution and filing of UCC-1 financing statements or amendments thereto, Mortgagee will have a valid first lien on the Mortgaged Property and a valid security interest in the Equipment subject to no liens, charges or encumbrances other than the Permitted Exceptions.

(k)       BMC (1) has not executed the Notes, this Mortgage, or any other Loan Document with the actual intent to hinder, delay, or defraud any creditor and (2) has received reasonably equivalent value in exchange for its obligations under the Notes, this Mortgage, and the other Loan Documents.  The fair saleable value of Mortgagor's assets exceed and will, immediately following the execution and delivery of this Mortgage, exceed Mortgagor's total liabilities, including, without limitation, subordinated, unliquidated, disputed or contingent liabilities.  The fair saleable value of Mortgagor's assets is and will, immediately following the execution and delivery of this Mortgage, be greater than Mortgagor's probable liabilities, including the maximum amount of its contingent liabilities or its debts as such debts become absolute and matured.  Mortgagor's assets do not and, immediately following the execution and delivery of this Mortgage will not, constitute unreasonably small capital to carry out its business as conducted or as proposed to be conducted.  Mortgagor shall not incur debts and liabilities (including, without limitation, contingent liabilities and other commitments) beyond its ability to pay such debts as they mature (taking into account the timing and amounts to be payable on or in respect of obligations of Mortgagor).

(l)         Mortgagor has full power, authority and right to execute, deliver and perform its obligations pursuant to this Mortgage, and to deed, mortgage, give, grant, bargain, sell, alien, convey, confirm, warrant, pledge, hypothecate and assign the Mortgaged Property pursuant to the terms hereof and to keep and observe all of the terms of this Mortgage on Mortgagor's part to be performed.

(m)      BMC is not a "foreign person" within the meaning of Section 1445(f)(3) of the Internal Revenue Code of 1986, as amended and the related Treasury Department regulations, including temporary regulations.

5.         Appointment of Receiver. In any action to foreclose this Mortgage, Mortgagee shall be entitled, without notice and as a matter of right and without regard to the adequacy of any security of the indebtedness or the solvency of Mortgagor, upon application to any court having jurisdiction, to the appointment of a receiver of the rents, income and profits of the Mortgaged Property.  If an Event of Default occurs under this Mortgage, BMC, upon demand of Mortgagee, shall surrender the possession of, and it shall be lawful for Mortgagee, by such officer or agent as it may appoint, to take possession of, all or any part of the Mortgaged Property together with the books, papers, and accounts of BMC pertaining thereto, and to hold, operate and manage the same, and from time to time to make all needed repairs and improvements as Mortgagee shall deem wise; and, if Mortgagee deems it necessary or desirable, to complete construction and equipping of any Improvements and in the course of such construction or equipping to make such changes to the same as it may deem desirable; and Mortgagee may sell the Mortgaged Property or any part thereof, or institute proceedings for the complete or partial foreclosure of the lien of this Mortgage on the Mortgaged Property, or lease the Premises or any part thereof in the name and for the account of Mortgagor or Mortgagee and collect, receive and sequester the rents, revenues, earnings, income, products and profits therefrom, and out of the same and any other monies received hereunder pay or provide for the payment of, all proper costs and expenses of taking, holding, leasing, selling and managing the same, including reasonable compensation to Mortgagee, its agents and counsel, and any charges of Mortgagee hereunder, and any taxes and other charges prior to the lien of this Mortgage which Mortgagee may deem it wise to pay.  The Receiver shall also be authorized to collect from BMC, and BMC agrees to pay, the fair rental value of BMC's use and occupancy of the Mortgaged Property.

6.         Payment of Real Estate Taxes.  BMC shall pay all taxes, assessments, sewer rents or water rates or sums due under any payment in lieu of tax agreement ("Pilot Agreement") and in default thereof, Mortgagee may pay the same.  In the event that Mortgagee shall pay any such tax, assessment, sewer rent, water rate or sums due under any Pilot Agreement, Mortgagee shall have the right, among other rights, to declare the amount so paid with interest thereon immediately due and payable, and upon default of BMC in paying any such amount with interest thereon, Mortgagee shall have the right, subject to the limitations contained in the definition of Secured Indebtedness hereinabove set forth, to foreclose for such amount as well as any amounts due under the Notes. 

In the event that BMC should fail to pay any sum BMC has agreed to pay pursuant to this covenant for a period in excess of forty-five (45) days after the same is due and payable, in addition to any other remedies available to Mortgagee hereunder, Mortgagee may, at its option, require that BMC deposit with Mortgagee, monthly, one-twelfth (1/12th) of the annual charges for taxes and any other sums BMC is obligated to pay pursuant to this covenant and BMC shall make such deposits with Mortgagee.  BMC shall simultaneously therewith deposit with Mortgagee a sum of money which together with the monthly installments aforementioned will be sufficient to make payment of all sums required to be paid hereunder at least thirty (30) days prior to the due date of such payments, it being understood that Mortgagee shall calculate the amount of such deposits and notify BMC of the sum due.  Should an Event of Default (hereinbelow defined) occur, the funds deposited with Mortgagee pursuant to this provision may be applied in payment of the charges for which said funds shall have been deposited or to the payment of any other sums secured by this Mortgage as Mortgagee sees fit.

7.         Payment of Mortgage Taxes.  BMC shall pay immediately all taxes, if any, imposed pursuant to Article 11 of the New York Tax Law or any other statute, order or regulation, whether said tax is imposed at the time of recording or subsequent thereto.  This obligation shall survive the satisfaction or other termination of this Mortgage.

8.        Sale in One Parcel.  In the event of a foreclosure of this Mortgage or any mortgage at any time consolidated with this Mortgage, Mortgagor agrees that Mortgagee shall be entitled to a judgment directing the referee appointed in the foreclosure proceeding to sell all of the parcels constituting the Mortgaged Property at one foreclosure sale, either as a group or separately and that the Mortgagor expressly waives any right that it may now have or hereafter acquire to (i) request or require that the parcels be sold separately or (ii) request, if Mortgagee has elected to sell parcels separately, that there be a determination of any deficiency amount after any such separate sale or otherwise require a calculation of whether said parcel or parcels separately sold were conveyed for their "fair market value".

 9.         Condemnation.   If any proceeding in eminent domain is commenced with respect to the Mortgage property, or any portion thereof, BMC shall give prompt written notice thereof  to Mortgagee and all condemnation awards to which Mortgagor may be entitled as a result of such condemnation or eminent domain proceeding shall be distributed and applied in accordance with the Credit Agreement.

10.         Maintenance and Use of Mortgaged Property.  BMC shall cause the Mortgaged Property to be maintained in a good and safe condition and repair.  The Improvements and the Equipment shall not be removed, demolished or materially altered (except for normal replacement of the Equipment in the ordinary course of business) without the consent of Mortgagee.  BMC shall promptly comply with all laws, orders and ordinances affecting the Mortgaged Property, or its use of the Mortgaged Property.  BMC shall not initiate, join in, acquiesce in, or consent to any change in any private restrictive covenant, zoning law or other public or private restriction, limiting or defining the uses which may be made of the Mortgaged Property or any part thereof.  If under applicable zoning provisions the use of all or any portion of the Mortgaged Property is or shall become a nonconforming use, BMC will not cause or permit such nonconforming use to be discontinued or abandoned without the express written consent of  Mortgagee.  BMC shall not (i) change the use of the Mortgaged Property, (ii) permit or suffer to occur any waste on or to the Mortgaged Property or to any portion thereof or (iii) take any steps whatsoever to convert the Mortgaged Property, or any portion thereof, to a condominium or cooperative form of management.  BMC will not install or permit to be installed on the Premises any underground storage tank.

11.         Transfer or Encumbrance of the Mortgaged Property.

(a)         Mortgagor shall not, without the prior written consent of Mortgagee, sell, convey, alienate, mortgage, encumber, pledge or otherwise transfer the Mortgaged Property or any part thereof, or permit the Mortgaged Property or any part thereof to be sold, conveyed, alienated, mortgaged, encumbered, pledged or otherwise transferred, provided, however, that the Agency may convey the Mortgaged Property to BMC, subject to this Mortgage and, upon providing Mortgagee with the prior written notice of same, in accordance with the Lease Agreement dated as of July 1, 1996 between BMC and the Agency (the "Agency Lease Agreement") without the Mortgagee's prior written consent.

(b)       A sale, conveyance, alienation, mortgage, encumbrance, pledge or transfer within the meaning of this Paragraph 11 shall be deemed to include, without limitation,(i) an installment sales agreement wherein Mortgagor agrees to sell the Mortgaged Property or any part thereof for a price to be paid in installments; (ii) an agreement by Mortgagor leasing all or a substantial part of the Mortgaged Property; and (iii) a sale, assignment or other transfer of, or the grant of a security interest in, Mortgagor's right, title and interest in and to any leases or any rents.

(c)         Mortgagee shall not be required to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Indebtedness immediately due and payable upon Mortgagor's sale, conveyance, alienation, mortgage, encumbrance, pledge or transfer of the Mortgaged Property without Mortgagee's consent.  This provision shall apply to every sale, conveyance, alienation, mortgage, encumbrance, pledge or transfer of the Mortgaged Property regardless of whether voluntary or not, or whether or not Mortgagee has consented to any previous sale, conveyance, alienation, mortgage, encumbrance, pledge or transfer of the Mortgaged Property.

(d)         Mortgagee's consent to one sale, conveyance, alienation, mortgage, encumbrance, pledge or transfer of the Mortgaged Property shall not be deemed to be a waiver of Mortgagee's right to require such consent to any future occurrence of same.  Any sale, conveyance, alienation, mortgage, encumbrance, pledge or transfer of the Mortgaged Property made in contravention of this paragraph shall be null and void and of no force and effect.

(e)         Mortgagee may withhold its consent in its sole discretion.

12.       Books and Records.  BMC shall keep and maintain at all times at BMC's address stated in this Mortgage, or such other place as Mortgagee may approve in writing, complete and accurate books of accounts and records adequate to reflect correctly the results of the operation of the Mortgaged Property and copies of all written contracts, leases and other instruments which affect the Mortgaged Property.  Such books, records, contracts, leases and other instruments shall be subject to examination and inspection at any reasonable time by Mortgagee, at Mortgagee's expense upon five (5) days prior notice, at BMC's office.

13.         Estoppel Certificates and No Default Affidavits.  After request by Mortgagee, BMC shall within ten (10) days furnish Mortgagee with a statement, duly acknowledged and certified, setting forth (i) the amount of the original principal amount of the Notes, (ii) the unpaid principal amount of the Notes, (iii) the rate of interest of the Notes, (iv) the date installments of interest and/or principal were last paid, (v) any offsets or defenses to the payment of the Indebtedness, if any, (vi) that the Notes, this Mortgage and the other Loan Documents are valid, legal and binding obligations and have not been modified or if modified, giving particulars of such modification; and (vii) reaffirming all representations and warranties of Mortgagor set forth herein and in the other Loan Documents as of the date requested by Mortgagee or, to the extent of any changes to any such representations and warranties, so stating such changes.

14.       Usury.  It is expressly stipulated and agreed to be the intent of BMC and Mortgagee at all times to comply with applicable state usury law or applicable United States federal usury law (to the extent that it permits Mortgagee to contract for, charge, take, reserve, or receive a greater amount of interest than under state law).  If the applicable law (state or federal) is ever judicially interpreted so as to render usurious any amount called for under the Notes or under any of the other Loan Documents, or contracted for, charged, taken, reserved, or received with respect to the Indebtedness, or if Mortgagee's exercise of the option to accelerate the maturity of the Notes, or if any prepayment by BMC results in BMC having paid any interest in excess of that permitted by applicable law, then it is BMC's and Mortgagee's express intent that all excess amounts theretofore collected shall be credited on the principal balance of the Notes and all other Indebtedness (or, if the Notes and all other Indebtedness have been or would thereby be paid in full, refunded to BMC), and the provisions of the Notes and the other Loan Documents immediately be deemed reformed and the amounts thereafter collectible hereunder and thereunder reduced, without the necessity of the execution of any new documents, so as to comply with the applicable law, but so as to permit the recovery of the fullest amount otherwise called for hereunder or thereunder.  

15.         Performance of Other Agreements.  BMC shall observe and perform each and every term to be observed or performed by Mortgagor pursuant to the terms of any agreement or recorded instrument affecting or pertaining to the Mortgaged Property.

16.       Further Acts, Etc.  Mortgagor will, at the cost of BMC, and without expense to Mortgagee, do, execute, acknowledge and deliver all and every such further acts, deeds, conveyances, mortgages, assignments, notices of assignment, Uniform Commercial Code financing statements or continuation statements, transfers and assurances as Mortgagee shall, from time to time, require, for the better assuring, conveying, assigning, transferring, and confirming unto Mortgagee the property and rights hereby deeded, mortgaged, given, granted, bargained, sold, alienated, conveyed, confirmed, pledged, assigned and hypothecated or intended now or hereafter so to be, or which Mortgagor may be or may hereafter become bound to convey or assign to Mortgagee, or for carrying out the intention or facilitating the performance of the terms of this Mortgage or for filing, registering or recording this Mortgage.  Mortgagor, on demand, will execute and deliver and hereby authorizes Mortgagee to execute in the name of Mortgagor or without the signature of Mortgagor to the extent Mortgagee may lawfully do so, one or more financing statements, chattel mortgages or other instruments, to evidence more effectively the security interest of Mortgagee in the Mortgaged Property.  Upon foreclosure, the appointment of a receiver or any other relevant action, Mortgagor will, at the cost of BMC and without expense to Mortgagee, cooperate fully and completely to effect the assignment or transfer of any license, permit, agreement or any other right necessary or useful to the operation of or the Mortgaged Property.  Mortgagor grants to Mortgagee an irrevocable power of attorney coupled with an interest for the purpose of exercising and perfecting any and all rights and remedies available to Mortgagee at law and in equity, including, without limitation, such rights and remedies available to Mortgagee pursuant to this paragraph.

17.         Recording of Mortgage, Etc.  BMC forthwith upon the execution and delivery of this Mortgage and thereafter, from time to time, will cause this Mortgage, and any security instrument creating a lien or security interest or evidencing the lien hereof upon the Mortgaged Property and each instrument of further assurance to be filed, registered or recorded in such manner and in such places as may be required by any present or future law in order to publish notice of and fully to protect the lien or security interest hereof upon, and the interest of Mortgagee in, the Mortgaged Property.  BMC will pay all filing, registration or recording fees, and all expenses incident to the preparation, execution and acknowledgment of this Mortgage, any mortgage supplemental hereto, any security instrument with respect to the Mortgaged Property and any instrument of further assurance, and all federal, state, county and municipal, taxes, duties, imposts, assessments and charges arising out of or in connection with the execution and delivery of this Mortgage, any mortgage supplemental hereto, any security instrument with respect to the Mortgaged Property or any instrument of further assurance, except where prohibited by law so to do.  BMC shall hold harmless and indemnify Mortgagee, its successors and assigns, against any liability incurred by reason of the imposition of any tax on the making and recording of this Mortgage.

18.         Reporting Requirements.  BMC agrees to give prompt notice to Mortgagee of the insolvency or bankruptcy filing of BMC or the insolvency or bankruptcy filing of any guarantor of the Indebtedness.

19.       Events of Default.  The Indebtedness under the Notes shall become immediately due and payable at the option of Mortgagee upon the happening of any one or more of the following events of default (each an "Event of Default"):

(a)       an Event of Default shall have occurred under any of the Notes or under any Loan Document, including, if applicable the expiration of any grace period provided thereon;

(b)       failure of Mortgagor to perform or observe any covenant, agreement, representation, warranty or other provision contained in this Mortgage;

(c)       if any representation or warranty of BMC made herein or in any certificate, report, or other instrument or document furnished to BMC hereunder shall have been false or misleading in any material respect when made;

(d)       if BMC shall be in default under any other mortgage or security agreement covering any part of the Mortgaged Property whether it be superior or junior in lien to this Mortgage;

(e)       if the Mortgaged Property becomes subject to any mechanic's, materialman's or other lien and such lien is not removed of record within thirty (30) days of the filing or recording of such lien (except a lien for local real estate taxes and assessments not then due and payable); or

(f)       if BMC ceases to continuously use the Mortgaged Property or any material portion thereof for any reason whatsoever (other than temporary cessation in connection with any repair or renovation thereof undertaken with the consent of Mortgagee).

20.       Right To Cure Defaults.  Upon the occurrence of any Event of Default or if BMC fails to make any payment (including, without limitation, any required payments for taxes, insurance or to discharge any liens with respect to the Property) or to do any act as herein provided, Mortgagee may, but without any obligation to do so and without notice to or demand on BMC and without releasing BMC from any obligation hereunder, make or do the same in such manner and to such extent as Mortgagee may deem necessary to protect the security hereof.  Mortgagee is authorized to enter upon the Mortgaged Property for such purposes or appear in, defend, or bring any action or proceeding to protect its interest in the Mortgaged Property or to foreclose this Mortgage, and the cost and expense thereof (including reasonable attorneys' fees and disbursements to the extent permitted by law), with interest at the highest rate provided in the Notes for the period after notice from Mortgagee that such cost or expense was incurred to the date of payment, shall constitute a portion of the Indebtedness, subject to the limitations contained in the definition of Secured Indebtedness hereinabove set forth, shall be secured by this Mortgage and shall be due and payable upon demand.  

21.         Additional Remedies.

(a)       Upon the occurrence of any Event of Default, Mortgagee may take such action, without notice or demand, as it deems advisable to protect and enforce its rights against Mortgagor and in and to the Mortgaged Property by Mortgagee itself or otherwise, and Mortgagee may take the following additional actions, each of which may be pursued concurrently or otherwise, at such time and in such order as they may determine, in their sole discretion, without impairing or otherwise affecting their other rights and remedies:

(i)       declare the entire Indebtedness to be immediately due and payable;

(ii)       institute a proceeding or proceedings, judicial or nonjudicial, by advertisement or otherwise, for the complete foreclosure of this Mortgage in which case the Mortgaged Property or any interest therein may be sold for cash or upon credit in one or more parcels or in several interests or portions and in any order or manner, reserving Mortgagee's right to seek a deficiency judgment against BMC;

(iii)       with or without entry, to the extent permitted and pursuant to the procedures provided by applicable law, institute proceedings for the partial foreclosure of this Mortgage for the portion of the Indebtedness then due and payable, subject to the continuing lien of this Mortgage for the balance of the Indebtedness not then due;

(iv)      sell for cash or upon credit the Mortgaged Property or any part thereof and all estate, claim, demand, right, title and interest of Mortgagor therein and rights of redemption thereof, pursuant to the power of sale contained herein or otherwise, at one or more sales, as an entirety or in parcels, at such time and place, upon such terms and after such notice thereof as may be required or permitted by law;

(v)       institute an action, suit or proceeding in equity for the specific performance of any covenant, condition or agreement contained herein, or in any of the other Loan Documents;

(vi)      recover judgment on the Notes either before, during or after any proceedings for the enforcement of this Mortgage;

(vii)      apply for the appointment of a trustee, receiver, liquidator or conservator of the Mortgaged Property, without notice and without regard for the adequacy of the security for the Obligations and without regard for the solvency of BMC, any Guarantor or of any person, firm or other entity liable for the payment of the Obligations;

(viii)     sell all or any portion of the Mortgaged Property pursuant to Article 14 of New York's Real Property Actions and Proceedings Law; and

(ix)      pursue such other rights and remedies as may be available at law or in equity or under the Uniform Commercial Code including without limitation the right to receive Rents and any other receivables or rights to payments of BMC relating to the Mortgaged Property.

In the event of a sale, by foreclosure or otherwise, of less than all of the Mortgaged Property, this Mortgage shall continue as a lien on the remaining portion of the Mortgaged Property.

(b)       The proceeds of any sale made under or by virtue of this paragraph, together with any other sums which then may be held by Mortgagee under this Mortgage, whether under the provisions of this paragraph or otherwise, shall be applied by Mortgagee to the payment of the Indebtedness in the manner set forth in  the Credit Agreement.

(c)         Mortgagee may adjourn from time to time any sale by it to be made under or by virtue of this Mortgage by announcement at the time and place appointed for such sale or for such adjourned sale or sales; and, except as otherwise provided by any applicable provision of law, Mortgagee, without further notice or publication, may make such sale at the time and place to which the same shall be so adjourned.

(d)       Upon the completion of any sale or sales pursuant hereto, Mortgagee, or an officer of any court empowered to do so, shall execute and deliver to the accepted purchaser or purchasers a good and sufficient instrument, or good and sufficient instruments, conveying, assigning and transferring all estate, right, title and interest in and to the property and rights sold.  Mortgagee is hereby irrevocably appointed the true and lawful attorney of Mortgagor, in its name and stead, to make all necessary conveyances, assignments, transfers and deliveries of the Mortgaged Property and rights so sold and for that purpose Mortgagee may execute all necessary instruments of conveyance, assignment and transfer, and may substitute one or more persons with like power, Mortgagor hereby ratifying and confirming all that its said attorney or such substitute or substitutes shall lawfully do by virtue hereof.  Any sale or sales made under or by virtue of this paragraph, whether made under the power of sale herein granted or under or by virtue of judicial proceedings or of a judgment or decree of foreclosure and sale, shall operate to divest all the estate, right, title, interest, claim and demand whatsoever, whether at law or in equity, of Mortgagor in and to the properties and rights so sold, and shall be a perpetual bar both at law and in equity against Mortgagor and against any and all persons claiming or who may claim the same, or any part thereof from, through or under Mortgagor.

(e)       Upon any sale made under or by virtue of this paragraph, whether made under the power of sale herein granted or under or by virtue of judicial proceedings or of a judgment or decree of foreclosure and sale, Mortgagee may bid for and acquire the Mortgaged Property or any part thereof and in lieu of paying cash therefor may make settlement for the purchase price by crediting upon the Indebtedness the net sales price after deducting therefrom the expenses of the sale and costs of the action and any other sums which Mortgagee is authorized to deduct under this Mortgage.

(f)       No recovery of any judgment by Mortgagee and no levy of an execution under any judgment upon the Mortgaged Property or upon any other property of BMC shall affect in any manner or to any extent the lien of this Mortgage upon the Mortgaged Property or any part thereof, or any liens, rights, powers or remedies of Mortgagee hereunder, but such liens, rights, powers and remedies of Mortgagee shall continue unimpaired as before.

(g)         Mortgagee may terminate or rescind any proceeding or other action brought in connection with its exercise of the remedies provided in this paragraph at any time before the conclusion thereof, as determined in Mortgagee's sole discretion and without prejudice to Mortgagee.

(h)         Mortgagee may resort to any remedies and the security given by the Notes, this Mortgage or the other Loan Documents in whole or in part, and in such portions and in such order as determined by their sole discretion.  No such action shall in any way be considered a waiver of any rights, benefits or remedies evidenced or provided by the Notes, this Mortgage or any of the other Loan Documents.  The failure to exercise any right, remedy or option provided in the Notes, this Mortgage or any of the other Loan Documents shall not be deemed a waiver of such right, remedy or option or of any covenant or obligation secured by the Notes, this Mortgage or the other Loan Documents.  No acceptance by Lenders of any payment after the occurrence of any Event of Default and no payment by Mortgagee of any obligation for which BMC is liable hereunder shall be deemed to waive or cure any Event of Default with respect to BMC, or BMC's liability to pay such obligation.  No sale of all or any portion of the Mortgaged Property, no forbearance on the part of Mortgagee, and no extension of time for the payment of the whole or any portion of the Indebtedness or any other indulgence given by Mortgagee to BMC, shall operate to release or in any manner affect the interest of Mortgagee in the remaining Mortgaged Property or the liability of BMC to pay the Indebtedness.  No waiver by Mortgagee shall be effective unless it is in writing and then only to the extent specifically stated.  All costs and expenses of Mortgagee in exercising the rights and remedies under this Paragraph 21 (including reasonable attorneys' fees and disbursements to the extent permitted by law), shall be paid by BMC immediately upon notice from Mortgagee, with interest at the highest rate provided in any of the Notes for the period after notice from Mortgagee and, subject to the limitations contained in the definition of Secured Indebtedness hereinabove set forth, such costs and expenses shall constitute a portion of the Indebtedness and shall be secured by this Mortgage.

(i)       The interests and rights of Mortgagee under this Mortgage or in any of the other Loan Documents shall not be impaired by any indulgence, including (i) any renewal, extension or modification which Mortgage may grant with respect to any of the Indebtedness, (ii) any surrender, compromise, release, renewal, extension, exchange or substitution which Mortgagee may grant with respect to the Mortgaged Property or any portion thereof; or (iii) any release or indulgence granted to any maker, endorser, guarantor or surety of any of the Indebtedness.

(j)       The rights and remedies herein afforded to Mortgagee and the Lenders shall be cumulative and supplementary to and not exclusive of any other rights and remedies afforded the Mortgagee.

22.       Right of Entry.  In addition to any other rights or remedies granted under this Mortgage, Mortgagee, and its agents, during the Term, shall have the right to enter and inspect the Mortgaged Property during normal business hours.  The cost of such inspections or audits shall be borne by BMC, including the cost of all follow up or additional investigations or inquiries deemed reasonably necessary by Mortgagee.  The cost of such inspections, if not paid for by BMC following demand, shall bear interest thereafter until paid at the highest rate set forth in any of the Notes.

23.         Security Agreement.

(a)       This Mortgage is both a real property mortgage and a "security agreement" within the meaning of the Uniform Commercial Code.  The Mortgaged Property includes both real and personal property and all other rights and interests, whether tangible or intangible in nature, of Mortgagor in the Mortgaged Property.  Mortgagor, by executing and delivering this Mortgage, has granted and hereby grants to Mortgagee, as security for the Indebtedness, a security interest in the Mortgaged Property to the full extent that the Mortgaged Property may be subject to the Uniform Commercial Code (said portion of the Mortgaged Property so subject to the Uniform Commercial Code being called in this paragraph the "Collateral"). This Mortgage shall also constitute a "fixture filing" for the purposes of the Uniform Commercial Code.  As such, this Mortgage covers all items of the Collateral that are or are to become fixtures.  Information concerning the security interest herein granted may be obtained from the parties at the addresses of the parties set forth in the first paragraph of this Mortgage.

(b)       If an Event of Default shall occur, Mortgagee, in addition to any other rights and remedies which it may have, shall have and may exercise immediately and without demand, any and all rights and remedies granted to a secured party upon default under the Uniform Commercial Code, including, without limiting the generality of the foregoing, the right to take possession of the Collateral or any part thereof, and to take such other measures as Mortgagee may deem necessary for the care, protection and preservation of the Collateral.  Upon request or demand of Mortgagee, BMC shall at its expense assemble the Collateral and make it available to Mortgagee at a convenient place acceptable to Mortgagee.  BMC shall pay to Mortgagee on demand any and all expenses, including attorneys' fees and disbursements, incurred or paid by Mortgagee in protecting the interest in the Collateral and in enforcing the rights hereunder with respect to the Collateral.  Any notice of sale, disposition or other intended action by Mortgagee with respect to the Collateral sent to Mortgagor in accordance with the provisions hereof at least ten (10) days prior to such action, shall constitute commercially reasonable notice to BMC.  The proceeds of any disposition of the Collateral, or any part thereof, shall be applied by Mortgagee to the payment of the Indebtedness in such manner as may be provided in the Credit Agreement.  In the event of any change in name, identity or structure of any Mortgagor, such Mortgagor shall notify Mortgagee thereof and promptly after request shall execute, file and record such Uniform Commercial Code forms as are necessary to maintain the priority of Mortgagee's lien upon and security interest in the Collateral, and BMC shall pay all expenses and fees in connection with the filing and recording thereof.  If Mortgagee shall require the filing or recording of additional Uniform Commercial Code forms or continuation statements, Mortgagor shall, at BMC's expense, promptly after request, execute, file and record such Uniform Commercial Code forms or continuation statements as Mortgagee shall deem necessary, and BMC shall pay all expenses and fees in connection with the filing and recording thereof.  Mortgagor hereby irrevocably appoints Mortgagee as its attorney-in-fact, coupled with an interest, to file with the appropriate public office on its behalf any financing or other statements signed only by Mortgagee, as secured party, in connection with the Collateral covered by this Mortgage.

24.       Waiver of Setoff and Counterclaim.  All amounts due under this Mortgage, the Notes and the other Loan Documents shall be payable without setoff, counterclaim or any deduction whatsoever.  Mortgagor hereby waives the right to assert a setoff, counterclaim (other than a mandatory or compulsory counterclaim) or deduction in any action or proceeding in which Mortgagee is a participant, or arising out of or in any way connected with this Mortgage, the Notes, any of the other Loan Documents or the Indebtedness.

25.         Recovery of Sums Required to be Paid.  The Mortgagee shall have the right from time to time to take action to recover any sum or sums which constitute a part of the Indebtedness as the same become due, without regard to whether or not the balance of the Indebtedness shall be due, and without prejudice to the right of Mortgagee thereafter to bring an action of foreclosure, or any other action, for a default or defaults by Mortgagor existing at the time such earlier action was commenced.

26.         Marshalling and Other Matters.  Mortgagor hereby waives, to the extent permitted by law, the benefit of all appraisement, valuation, stay, extension, reinstatement and redemption laws now or hereafter in force and all rights of marshalling in the event of any sale hereunder of the Mortgaged Property or any part thereof or any interest therein.  Further, Mortgagor hereby expressly waives any and all rights of redemption from sale under any order or decree of foreclosure of this Mortgage on behalf of Mortgagor, and on behalf of each and every person acquiring any interest in or title to the Mortgaged Property subsequent to the date of this Mortgage and on behalf of all persons to the extent permitted by applicable law.

27.         Hazardous Substances.  The Mortgagor shall not use, or permit the use of, the Mortgaged Property for the handling, storage, transportation, manufacture, release or disposal of any Hazardous Substances.  In addition, the Mortgagor shall not install or maintain, or permit the installation or maintenance of, any above-ground or underground storage tanks for the storage of petroleum, petroleum by-products or other Hazardous Substances in, about or under the Mortgaged Property unless (a) the Mortgagor has obtained the prior written consent of the Mortgagee for such installation and maintenance and (b) the Mortgagor installs and maintains such above-ground or underground storage tanks in compliance with all applicable Environmental Laws.  Notwithstanding the foregoing, the Mortgagor or any tenant of the Mortgagor may use or store immaterial amounts of commonly known and used materials which may be deemed Hazardous Substances hereunder, provided that any such use or storage (i) does not constitute a remunerative activity of the Mortgagor or any tenant, (ii) is incidental to the Mortgagor's or such tenant's primary use of the Mortgaged Property and does not constitute a primary use thereof, and (iii) complies at all times with all applicable Environmental Laws.  "Hazardous Substances" means any Contaminant (as defined in the Credit Agreement), asbestos, ureaformaldehyde, polychlorinated biphenyls, nuclear fuel or material, chemical waste, radioactive material, explosives, known carcinogens, petroleum products and by-products and other dangerous, toxic or hazardous pollutants, contaminants, chemicals, materials or substances listed or identified in, or regulated by, any Environmental Laws.  Each of the agreements set forth in Section 7.9 of the Credit Agreement are hereby incorporated by reference herein with the same effect as if such agreements had been set forth herein.

28.         Conflicts with Credit Agreement.  Notwithstanding anything in this Mortgage to the contrary, in the event of a conflict or patent inconsistency between the terms of this Mortgage and the Credit Agreement, the terms of the Credit Agreement shall govern and apply.

29.         Notices.  Any notice, report, demand or other instrument authorized or required to be given or furnished ("Notices") shall be in writing and shall be given as follows:  (a) by hand delivery; (b) by deposit in the United States mail as first class certified mail, return receipt requested, postage paid; (c) by overnight nationwide commercial courier service; or (d) by telecopy transmission (other than for notices of default) with a confirmation copy to be delivered by duplicate notice in accordance with any of clauses (a)- (c) above, in each case, addressed to the party intended to receive the same at the following address(es):

Mortgagee:                   Deutsche Bank Trust Company Americas
233 South Wacker Drive, 84th Floor
Chicago, Illinois  60606
Attn:  John Anos
Telecopy No.:  (312) 993-8162

With a copy to:             Winston & Strawn
35 West Wacker Drive
Chicago, Illinois  60601
Attn.:  Charles B. Boehrer, Esq.
Telecopy No.:  (312) 558-5700

Agency:                        Cortland County Industrial Development Agency
34 Tompkins Street
Cortland,  New York 13045
Attn: Executive Director
Telecopy No.: (607) 756-7901

With a copy to:             Riehlman, Shafer & Shafer
397 Route 281
P.O. Box 430
Tully, New York 13159
Attn:  John P. Sidd, Esq.
Telecopy No.: (315) 696-6019
 

BMC:                          BMC Industries, Inc.
P.O. Box 189
Kellogg Road
Cortland, New York 13045
Attn: Treasurer

with a copy to:              Jon Dobson, Esq.
Vice President, General Counsel
BMC Industries, Inc.
One Meridan Crossings
Suite 850
Minneapolis, MN 55423
Telecopy No.:  (952) 851-6050

Any party may change the address to which any such Notice is to be delivered, by furnishing ten (10) days written notice of such change to the other parties in accordance with the provisions of this Paragraph 29.  Notices shall be deemed to have been given on the date they are actually received; provided, that the inability to deliver Notices because of a changed address of which no Notice was given, or rejection or refusal to accept any Notice offered for delivery shall be deemed to be receipt of the Notice as of the date of such inability to deliver or rejection or refusal to accept delivery.  Notice for either party may be given by its respective counsel.

30.       Waiver of Notice.  Mortgagor shall not be entitled to any notices of any nature whatsoever from Mortgagee except with respect to matters for which this Mortgage specifically and expressly provides for the giving of notice by Mortgagee to Mortgagor and except with respect to matters for which Mortgagee is required by applicable law to give notice, and Mortgagor hereby expressly waives the right to receive any notice from Mortgagee with respect to any matter for which this Mortgage does not specifically and expressly provide for the giving of notice by Mortgagee to Mortgagor.

31.       Sole Discretion of Mortgagee.  Wherever pursuant to this Mortgage, Mortgagee exercises any right given to it to consent or not consent or approve or disapprove, or any arrangement or term is to be satisfactory to Mortgagee, the decision of Mortgagee to consent or not consent, to approve or disapprove or to decide that arrangements or terms are satisfactory or not satisfactory shall be in the sole discretion of Mortgagee and shall be final and conclusive, except as may be otherwise expressly and specifically provided herein.

32.       Non-Waiver.  The failure of Mortgagee to insist upon strict performance of any term hereof shall not be deemed to be a waiver of any term of this Mortgage.  Mortgagor shall not be relieved of Mortgagor's obligations hereunder by reason of (a) the failure of Mortgagee or Lenders to comply with any request of Mortgagor to take any action to foreclose this Mortgage or otherwise enforce any of the provisions hereof or of the Notes, or the other Loan Documents, (b) the release, regardless of consideration, of the whole or any part of the Mortgaged Property, or of any person liable for the Indebtedness or any portion thereof, or (c) any agreement or stipulation by Mortgagee or Lenders extending the time of payment or otherwise modifying or supplementing the terms of the Notes, this Mortgage or any of the other Loan Documents.  Mortgagee and the Lenders may resort for the payment of the Indebtedness to any other security held by them in such order and manner as they, in their sole discretion, may elect.  Mortgagee and the Lenders may take action to recover the Indebtedness, or any portion thereof, or to enforce any covenant hereof without prejudice to the right of Mortgagee thereafter to foreclosure this Mortgage.  The rights and remedies of Mortgagee under this Mortgage shall be separate, distinct and cumulative and none shall be given effect to the exclusion of the others.  No act of Mortgagee or the Lenders shall be construed as an election to proceed under any one provision herein to the exclusion of any other provision.  Mortgagee and the Lenders shall not be limited exclusively to the rights and remedies herein stated but shall be entitled to every right and remedy now or hereafter afforded at law or in equity.

33.       No Oral Change.  This Mortgage, and any provisions hereof, may not be modified, amended, waived, extended, changed, discharged or terminated orally or by any act or failure to act on the part of Mortgagor or Mortgagee, but only by an agreement in writing signed by the party against whom enforcement of any modification, amendment, waiver, extension, change, discharge or termination is sought.

34.         Liability.  Subject to the provisions contained in Paragraph 55 of this Mortgage, if Mortgagor consists of more than one person, the obligations and liabilities of each such person hereunder shall be joint and several.  Subject to the provisions hereof requiring Mortgagee's consent to any transfer of the Mortgaged Property, this Mortgage shall be binding upon and inure to the benefit of Mortgagor and Mortgagee and their respective successors and assigns forever.

35.         Inapplicable Provisions.  If any term, covenant or condition of this Mortgage is held to be invalid, illegal or unenforceable in any respect, this Mortgage shall be construed without such provision.

36.         Headings, Etc.  The headings and captions of various paragraphs of this Mortgage are for convenience of reference only and are not to be construed as defining or limiting, in any way, the scope or intent of the provisions hereof.

37.         Definitions.  Unless the context clearly indicates a contrary intent or unless otherwise specifically provided herein, words used in this Mortgage may be used interchangeably in singular or plural form and the word "Mortgagor" shall mean "each Mortgagor and any subsequent owner or owners of the Mortgaged Property or any part thereof or any interest therein," the word "Mortgagee" shall mean "Mortgagee and any subsequent Administrative Agent under the Credit Agreement," the word "Notes" shall mean "any of the Notes and any other evidence of indebtedness secured by this Mortgage," the word "person" shall include an individual, corporation, partnership, trust, unincorporated association, government, governmental authority, and any other entity, and the words "Mortgaged Property" shall include any portion of the Mortgaged Property and any interest therein and the words "attorneys' fees" shall include any and all attorneys' fees, paralegal and law clerk fees, including, without limitation, fees at the pre-trial, trial and appellate levels incurred or paid by Mortgagee in protecting its interest in the Mortgaged Property and Collateral and enforcing its rights hereunder.  Whenever the context may require, any pronouns used herein shall include the corresponding masculine, feminine or neuter forms, and the singular form of nouns and pronouns shall include the plural and vice versa.

38.       Actions and Proceedings.  If any action or proceeding be commenced to which action or proceeding Mortgagee is made a party and in which it becomes necessary in the opinion of Mortgagee to defend or uphold the lien of this Mortgage, all sums paid by Mortgagee for the expense of any litigation to prosecute and defend the rights and lien created by this Mortgage, including reasonable counsel fees, costs and allowances, shall, together with interest thereon be a lien on the Mortgaged Property and, subject to the limitations contained in the definition of Secured Indebtedness hereinabove set forth, secured by this Mortgage and shall be collectible in like manner as said indebtedness and shall be paid by BMC upon receipt of an invoice from Mortgagee.

39.       Leases of the Mortgaged Property.  Mortgagor will not enter into any lease(s) for all or any portion of the Mortgaged Property other than the Agency Lease Agreement without the prior written consent of Mortgagee.

40.       Real Property Law.  All covenants hereof, which are in addition to those set forth in Sections 254 and 291-f of the New York Real Property Law, shall be construed as affording to Mortgagee rights additional to, and not exclusive of, the rights conferred under the provisions of said Sections 254 and 291-f.

41.         Successors.  All of the provisions of this Mortgage shall inure to the benefit of Mortgagee and of any subsequent holder of this Mortgage and shall be binding upon Mortgagor and each subsequent owner of the Mortgaged Property.

42.       Effect of Releases.  Mortgagee, without notice, may release any part of the security described herein, or any person or entity liable for any Indebtedness without in any way affecting the lien hereof upon any part of the security not expressly released, and may agree with any party obligated on said Indebtedness or having any interest in the security described herein to extend the time for payment of any part or all of the Indebtedness.  Such agreement shall not in any way release or impair the lien hereof, but shall extend the lien hereof as against the title of all parties having any interest in said security, which interest is subject to said lien, and no such release or agreement shall release any person or entity obligated to pay any Indebtedness.

43.         Mortgagee Not Obligated.  Nothing herein contained shall be construed as making the payment of any insurance premiums, taxes or assessments obligatory upon Mortgagee, although Mortgagee may pay same, or as making Mortgagee liable in any way for loss, damage or injury, resulting from the non-payment of any such insurance premiums, taxes or assessments.

44.       Lien Law.  BMC will, in compliance with Section 13 of the New York Lien Law, receive the advances secured by this Mortgage and will hold the right to receive such advances as a trust fund to be applied first for the purpose of paying the cost of the improvement and will apply the same first to the payment of the cost of the improvement before using any part of the total of the same for any other purpose.

45.       Costs, Expenses and Attorney's Fees.  Should one or more Events of Default occur hereunder, and should an action be commenced for the foreclosure of this Mortgage, Mortgagee shall be entitled to recover all sums due hereunder, statutory costs, and any additional allowances made pursuant to Section 8303(a) of the Civil Practice Law and Rules of the State of New York, and in addition thereto, reasonable attorneys' fees in such proceeding and in all proceedings related thereto necessary to and related to the foreclosing proceeding, and such amount shall be paid by BMC on demand and shall be a lien on the Mortgaged Property prior to any right or title to, interest in or claim upon the Mortgaged Property attaching and accruing subsequent to the lien of this Mortgage, and shall be deemed to be secured by this Mortgage and the indebtedness which it secures.

46.       Entire Agreement. This Mortgage constitutes the entire understanding between Mortgagor and Mortgagee relative to the granting of a mortgage lien on the Mortgaged Property and supersedes any prior writings or oral statements or conversations at any time made or had with respect thereto.

47.         Governing Law; Severability. This Mortgage shall be governed by the law of the jurisdiction in which the Mortgaged Property is located.  In the event that any provision or clause of this Mortgage conflicts with applicable law, such conflict shall not affect other provisions of this Mortgage which can be given effect without the conflicting provision, and to this end, the provisions of this Mortgage are declared to be severable.

48.       Time of the Essence. Time is of the essence with respect to each and every covenant, agreement and obligation of Mortgagor under this Mortgage.

49.         WAIVER OF JURY TRIAL.  MORTGAGOR AND MORTGAGEE HEREBY WAIVE TRIAL BY JURY IN ANY LITIGATION IN ANY COURT WITH RESPECT TO, IN CONNECTION WITH, OR ARISING OUT OF THIS MORTGAGE OR THE VALIDITY, PROTECTION, INTERPRETATION, COLLECTION OR ENFORCEMENT HEREOF, OR THE RELATIONSHIP BETWEEN MORTGAGOR AND MORTGAGEE OR ANY OTHER CLAIM OR DISPUTE HOWSOEVER ARISING BETWEEN MORTGAGOR AND MORTGAGEE ARISING UNDER THIS MORTGAGE.

50.       Tax Law Section 253 Statement. This Mortgage does not cover real property principally improved or to be improved by one or more structures containing in the aggregate not more than six residential dwelling units, each having their own separate cooking facilities.

51.         Execution of Counterparts.  This Agreement may be executed in one or more counterparts, any one or all of which shall constitute but one agreement.

52.         No Recourse; Special Obligation.

(a)         The obligations and agreements of the Agency contained herein and any other instrument or document executed in connection therewith or herewith, and any other instrument or document supplemental thereto or hereto, shall be deemed the obligations and agreements of the Agency, and not of any member, officer, director, agent (other than BMC) or employee of the Agency in his individual capacity, and the members, officers, directors, agents (other than BMC) and employees of the Agency shall not be liable personally hereon or thereon or be subject to any personal liability or accountability based upon or in respect hereof or thereof or of any transaction contemplated hereby or thereby.

(b)         The obligations and agreements of the Agency contained herein and therein shall not constitute or give rise to an obligation of the State of New York or Cortland County, New York, and neither the State of New York nor Cortland County, New York shall be liable hereon or thereon, and, further, such obligations and agreements shall not constitute or give rise to a general obligation of the Agency, and Mortgagee shall have no recourse to the Agency other than the Agency's interests in the Mortgaged Property, including, but not limited to, the revenues derived and to be derived from the sale or other disposition of the Real Property.  This Mortgage is specifically subordinate to the exercise by the Agency of the following rights (the "Agency's Reserved Rights") under the Agency Lease Agreement:  The right to (a) receive in its own behalf all opinions of counsel, reports, statements, certificates, insurance policies or binders or certificates, or other communications required to be delivered by BMC to the Agency; (b) grant or withhold any consents or approvals required of the Agency; (c) to enforce or otherwise exercise in its own behalf all agreements of BMC with respect to ensuring that the Mortgaged Property shall always constitute a qualified "project" as defined in and as contemplated by the Act (as that term is defined in the Agency Lease Agreement); (d) to amend with BMC the provisions of the Payment in Lieu of Tax Agreement (as that term is defined in the Agency Lease Agreement); (e) to enforce in its own behalf (or on behalf of the appropriate taxing authorities) the provisions of, and receive amounts payable under the Payment in Lieu of Tax Agreement and Sections 5.3, 8.9, 10.2 and 10.4 of the Agency Lease Agreement; (f) to be indemnified pursuant to Section 8.2 of the Agency Lease Agreement; (g) to terminate the Agency Lease Agreement in accordance with its terms; and (h) to reconvey the Mortgaged Property to Borrower in accordance with the terms of the Agency Lease Agreement.  The Agency's Reserved Rights are not pledged to the Mortgagee hereunder and are reserved to the Agency and the contractual obligations of BMC with respect to the Agency's Reserved Rights shall survive a foreclosure of this Mortgage.

(c)         No order or decree of specific performance with respect to any of the obligations of the Agency hereunder shall be sought or enforced against the Agency unless (1) the party seeking such order or decree shall first have requested the Agency in writing to take the action sought in such order or decree of specific performance, and thirty (30) days shall have elapsed from the date of receipt of such request, and the Agency shall have refused to comply with such request (or, if compliance therewith would reasonably be expected to take longer than thirty (30) days, shall have failed to institute and diligently pursue action to cause compliance with such request within such ten day period) or failed to respond within such notice period, (2) if the Agency refuses to comply with such request and the Agency's refusal to comply is based on its reasonable expectation that it will incur fees and expenses, the party seeking such order or decree shall have placed in an account with the Agency an amount or undertaking sufficient to cover such reasonable fees and expenses, and (3) if the Agency refuses to comply with such request and the Agency's refusal to comply is based on its reasonable expectation that it or any of its members, officers, agents (other than BMC) or employees shall be subject to potential liability, the party seeking such order or decree shall (a) agree to indemnify, defend and hold harmless the Agency and its members, officers, directors, agents (other than BMC) and employees against any liability incurred as a result of its compliance with such demand, and (b) if requested by the Agency, furnish to the Agency satisfactory security to protect the Agency and its members, officers, directors, agents (other than BMC) and employees against all liability expected to be incurred as a result of compliance with such request.  Any failure to provide the indemnity and/or security required in this Section 52(c) shall not affect the full force and effect of an Event of Default hereunder.

53.         New York State Specific Provisions.

(a)         Inconsistencies.  In the event of any inconsistencies between the terms and conditions of this Section 53 and the other provisions of this Mortgage, the terms and conditions of this Section 53 shall control and be binding.

(b)         Insurance.  The provisions of subsection 4 of Section 254 of the New York Real Property Law covering the insurance of buildings against loss by fire shall not apply to this Mortgage.  In the event of any conflict, inconsistency or ambiguity between the provisions of this Mortgage and the provisions of subsection 4 of Section 254 of the New York Real Property Law covering the insurance of buildings against loss by fire, the provisions of the Mortgage shall control.

(c)      Leases.  Mortgagee shall have all of the rights against lessees of the Mortgaged Property set forth in Section 291-f of the Real Property Law of New York.

(d)         Statutory Construction.  The clauses and covenants contained in this Mortgage that are construed by Section 254 of the New York Real Property Law shall be construed as provided in those sections (except as provided in Section 53(b)).  The additional clauses and covenants contained in this Mortgage shall afford rights supplemental to and not exclusive of the rights conferred by the clauses and covenants construed by Section 254 and shall not impair, modify, alter, or defeat such rights (except as provided in Section 53(b)), notwithstanding that such additional clauses and covenants may relate to the same subject matter or provide for different or additional rights in the same or similar contingencies as the clauses and covenants construed by Section 254.  The rights of Mortgagee arising under the clauses and covenants contained in this Mortgage shall be separate, distinct, and cumulative and none of them shall be in exclusion of the others.  No act of Mortgagee or any of the Lenders shall be construed as an election to proceed under any one provision herein to the exclusion of any other provision, anything herein or otherwise to the contrary notwithstanding.  In the event of any inconsistencies between the provisions of Section 254 and the provisions of this Mortgage, the provisions of this Mortgage shall prevail.

(e)      Power of Sale.  Upon the occurrence of an Event of Default, Mortgagee shall have the right to sell the Mortgaged Property, including, without limitation, by exercise of any and all rights and remedies available under Article 14 of the New York Real Property Actions and Proceedings Law (the "RPAPL").  Any deed or deeds executed and delivered in connection with the sale or sales of the Mortgaged Property pursuant to Article 14 of the RPAPL shall be in the form provided in Article 14 of the RPAPL.

[Remainder of page intentionally left blank]

IN WITNESS WHEREOF, this Mortgage has been duly executed as of the 27th day of September, 2002.

BMC INDUSTRIES, INC.

By:  /s/Bradley D. Carlson               
                               Bradley D. Carlson

CORTLAND COUNTY INDUSTRIAL DEVELOPMENT AGENCY

By:  /s/Paul F. Slowey
                               Paul F. Slowey

STATE OF MINNESOTA	)
	)	SS.:
COUNTY OF HENNEPIN	)

On the 25th day of September in the year 2002, before me, the undersigned, personally appeared  Bradley D. Carlson, personally known to me or proved to me on the basis of satisfactory evidence to be the individual whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his capacity, and that by his signature on the instrument, the individual or the person upon behalf of which the individual acted, executed the instrument, and that such individual made such appearance before the undersigned in the City of Minneapolis.  

/s/Julie K. Uhrich                      
                        Notary Public

STATE OF NEW YORK	)
	)	SS.:
COUNTY OF CORTLAND	)

On the 23rd day of September in the year 2002, before me, the undersigned, personally appeared PAUL F. SLOWEY, personally known to me or proved to me on the basis of satisfactory evidence to be the individual whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his capacity, and that by his signature on the instrument, the individual or the person upon behalf of which the individual acted, executed the instrument.

/s/Edwin J. Kelley Jr.               
                        Notary Public

EXHIBIT "A"

PARCEL 1

ALL THAT TRACT OR PARCEL OF LAND, situate in the Town of Cortlandville, City of Cortland, County of Cortland and State of New York, being part of Lot No. 76 in said Town, bounded and described as follows:

BEGINNING at a point in the centerline of Kellogg Road at its intersection with the south line of lands of the Erie-Lackawanna Railway Company (Cincinnatus Branch), reputed owner; thence running North 73° 47' 50" West along said south line of the Railway Company, a distance of 78.72 feet to a point; thence continuing westerly along said south line along the arc of a circle to the right having a radius of 1781.78 feet and a central angle of 17° 58' 20", a distance of 558.90 feet to a point; thence continuing along said south line North 55° 49' 20" West, a distance of 1135.06 feet to a point in the northeast corner of lands of The Grand Union Company, reputed owner; thence running South 8° 07' 15" West along the easterly line of The Grand Union Company, reputed owner, a distance of 1153.23 feet to a point in the north line of lands of The Erie-Lackawanna Railway Company (formerly known as The Syracuse, Binghamton and New York Railroad Company), reputed owner; thence running along said north line of the Railway Company South 44° 11' 30" East, a distance of 1637.37 feet to a point; thence continuing along said north line of the Railway Company South 46° 02' 40" East, a distance of 210.40 feet to a point; thence running North 60° 24' 10" East, a distance of 1129.21 feet to a point in the centerline of Kellogg Road, said point also being the northwesterly corner of lands of Richard Reeves and Elizabeth Reeves, reputed owners; thence running North 30° 29' 40" West along said centerline of Kellogg Road, a distance of 1169.32 feet to the place of beginning.

PARCEL II

ALL THAT TRACT OR PARCEL OF LAND, situate in the City of Cortland, County of Cortland and State of New York, being part of Lot No. 76 in said City, bounded and described as follows:

BEGINNING at a point in the south line of lands of The Erie-Lackawanna Railway Company (formerly known as The Syracuse, Binghamton and New York Railroad Company), reputed owner, said point being an angle point in said south line, said point being located a distance of 356.01 feet southeasterly from a point opposite the southwest corner of the parcel above described; thence running North 44° 11' 30" West along said south line of the Railway Company, a distance of 629.13 feet to a point, said point being designated as Station 13123+58.1, 1° Cv. R on a Map entitled "Station Map - Lands of The Syracuse, Binghamton and New York R.R. Co." dated April 2, 1915; thence running northwesterly along the arc of a circle to the right having a radius of 5770.58 feet and a central angle of 5° 04' 55", a distance of 511.83 feet to a point, said point also being the intersection of said south line of the Railway Company and the division line between Great Lots No. 75 and 76; thence running South 8° 10' 40" West along the west line of Lot No. 76, a distance of 959.61 feet to a point; thence running South 81° 49' 20" East, a distance of 700.00 feet to a point; thence running North 45° 48' 30" East, a distance of 309.90 feet to the place of beginning.

 Said premises being more particularly described as follows:

PARCEL I

ALL THAT TRACT OR PARCEL OF LAND, situate in the Town of Cortlandville, City of Cortland, County of Cortland and State of New York, being part of Lot No. 76 in said Town, bounded and described as follows:

BEGINNING at a point in the centerline of Kellogg Road, said point also being the southerly line of lands formerly owned by the Lehigh Valley Railroad, now owned by the City of Cortland; thence running North 72° 50' 40" West along said southerly line of the former Railroad a distance of 78.82 feet to a point of curvature; thence running northwesterly along the arc of a circle to the right, having a radius of 1781.78 feet, a central angle of 17° 58' 20" and an arc length of 558.90 feet to a point, said arc having a chord length of 556.61 feet at North 63° 51' 30" West; thence running North 54° 52' 20" West along said southerly line of the former Railroad, a distance of 1135.07 feet to a point marked by an existing iron pipe; thence running South 09° 04' 25" West a distance of 1153.23 feet to a point marked by an existing iron rod found in the northerly line of lands of Conrail; thence running South 43° 14' 20" East along said northerly line of the Railroad a distance of 1637.37 feet to an angle point in said line; thence running South 45° 05' 30" East along said northerly line of the Railroad a distance of 210.40 feet to a point; thence running North 61° 21' 20" East along the westerly line of lands of Westendorf, reputed owner per deed filed at Document #1999-4963, a distance of 1129.21 feet to a point in the centerline of the aforementioned Kellogg Road; thence running North 29° 32' 40" West along said centerline of Kellogg Road a distance of 1169.32 feet to the place of Beginning and containing 64.255 acres (2,798,937 square feet) more or less of land.

PARCEL II

ALL THAT TRACT OR PARCEL OF LAND, situate in the City of Cortland, County of Cortland and State of New York, being part of Lot No. 76 in said City, bounded and described as follows:

BEGINNING at a point in the southerly line of lands of Cortland County Industrial Development Agency, reputed owner per deed filed at Liber 506, Page 235 (formerly Erie Lackawanna Railroad), said point also being in the division line between Military Lots 76 and 75; thence running southeasterly along said southerly line of the Railroad, along the arc of a circle to the left, having a radius of 5770.58 feet, a central angle of 05° 04' 55" and an arc length of 511.82 feet to a point of tangency in said line, said arc having a chord length of 511.65 feet at South 40° 41' 54" East; thence running South 43° 14' 20" East along said southerly line of the Railroad, a distance of 629.13 feet to a point; thence running South 46° 45' 40" West a distance of 309.90 feet to a point; thence running North 80° 52' 10" West a distance of 700.00 feet to a point in the westerly line of Military Lot 76; thence running North 09° 07' 50" East along said division line between Military Lots 76 and 75, a distance of 959.61 feet to the place of Beginning and containing 11.558 acres (503,479 square feet) more or less of land.

-----END PRIVACY-ENHANCED MESSAGE-----

EX-10.45

BMC INDUSTRIES, INC.

______________________________

THIRD AMENDED AND RESTATED CREDIT AGREEMENT

dated as of September 27, 2002

______________________________

DEUTSCHE BANK TRUST COMPANY AMERICAS,
as Administrative Agent

BANK ONE, NA,
as Documentation Agent

and

VARIOUS LENDING INSTITUTIONS

TABLE OF CONTENTS

Page

ARTICLE I	2
1.1	Defined Terms.	2
1.2	Accounting Terms, Financial Statements.	37
1.3	Other Definitional Terms.	37
ARTICLE II	38
2.1	The Commitments.	38
	(a)  Term Loans.	a
	(b)  Revolving Loan Commitment	38
	(c)  Swing Line Loans.	39
2.2	Notes.	41
	(a)  Evidence of Indebtedness.	41
	(b)  Notation of Payments.	42
2.3	Minimum Amount of Each Borrowing; Maximum Number of Borrowings.	42
2.4	Borrowing Options.	42
2.5	Notice of Borrowing.	43
2.6	Conversion or Continuation.	43
2.7	Disbursement of Funds; Funding Assumptions.	44
2.8	Pro Rata Borrowings.	45
2.9	Amount and Terms of Letter of Credit.	45
	(a)  Letter of Credit Commitments, Terms of Letters of Credit.	45
	(b)  Procedure for Issuance of Letters of Credit.	46
	(c)  Draws upon Letters of Credit; Reimbursement Obligation.	47
	(d)  Lenders' Participation in Letters of Credit.	47
	(e)  Fees for Letters of Credit.	48
	(f)  LC Obligations Unconditional.	49
	(g)  Indemnification.	50
ARTICLE III	51
3.1	Interest.	52
	(a)  Base Rate Loans.	52
	(b)  Eurodollar Loans.	52
	(c)  Payment of Interest.	52
	(d)  Notification of Rate.	52
	(e)  Default Interest.	52
	(f)  Maximum Interest.	52
3.2	Fees.	53
	(a)  Commitment Fee.	53
	(b)  Agency Fees.	53
	(c)  Third Amended and Restated Credit Agreement Fees	53
	(d)  July 1, 2003 Special Fee	53
3.3	Computation of Interest and Fees.	53
3.4	Interest Periods.	54
3.5	Compensation for Funding Losses.	54
3.6	Increased Costs, Illegality, Etc.	55
	(a)  Generally.	55
	(b)  Eurodollar Loans.	57
	(c)  Capital Requirements.	57
	(d)  Change of Lending Office.	57
3.7	Replacement of Affected Lenders.	58
ARTICLE IV	58
4.1	Voluntary Reduction of Commitments.	58
4.2	Voluntary Prepayments.	59
4.3	Mandatory Prepayments.	60
	(a)  Prepayment Upon Overadvance.	60
	(b)  Payment at Termination Date.	60
	(c)  Mandatory Prepayment Upon Asset Disposition.	61
	(d)  Mandatory Prepayment Upon Incurrence of Indebtedness.	61
	(e)  Scheduled Term Repayments.	61
	(f)  Mandatory Prepayment With Excess Cash Flow.	61
	(g)  Mandatory Prepayment Upon Recovery Event	61
4.4	Application of Prepayments.	62
4.5	Method and Place of Payment.	62
4.6	Net Payments.	63
ARTICLE V	66
5.1	Corporate Existence; Compliance with Law.	67
5.2	Corporate Power; Authorization; No Violation.	67
5.3	Binding Effect.	67
5.4	Purpose of Loans.	67
5.5	Subsidiaries.	68
5.6	Indebtedness.	68
5.7	Financial Statements; Financial Condition; Undisclosed Liabilities; Projections, etc.	68
	(a)  Financial Statements.	68
	(b)  Solvency.	68
	(c)  No Undisclosed Liabilities.	69
	(d)  Projections.	69
5.8	No Material Litigation.	69
5.9	Performance of Agreements.	69
5.10	Taxes.	69
5.11	Governmental Regulation.	70
5.12	Ownership of Property; Liens.	70
5.13	Intellectual Property.	70
5.14	Disclosure.	70
5.15	ERISA.	71
5.16	Labor Relations.	71
5.17	Insurance.	71
5.18	Public Utility Holding Company Act.	71
5.19	Security Documents.	71
	(a)  Security Agreement Collateral.	71
	(b)  Real Estate Collateral.	71
5.20	Matters Pertaining to Second Amendment and Restatement Agreement.	72
	(a)  Representations and Warranties	72
	(b)  Corporate Power; Authorization; No Violation	72
5.21	Matters Pertaining to Third Amended and Restated Credit Agreement	72
	(a)  Representations and Warranties	72
	(b)  Corporate Power; Authorization; No Violation	72
5.22	Deposit Accounts	73
ARTICLE VI	73
6.1	Conditions Precedent to Effectiveness.	73
	(a)  Loan Documents.	73
	(b)  Corporate Proceedings.	74
	(c)  Corporate Documents.	75
	(d)  Incumbency Certificate.	75
	(e)  Fees and Amendment Fee.	75
	(f)  Legal Opinions.	75
	(g)  Approvals.	75
	(h)  Litigation.	76
	(i)  Officer's Certificate.	76
	(j)  Adverse Change.	76
6.2	Conditions Precedent to Effectiveness.	76
	(a)  Loan Documents.	76
	(b)  Corporate Proceedings.	78
	(c)  Corporate Documents.	78
	(d)  Incumbency Certificate.	78
	(e)  Fees and Amendment Fee.	78
	(f)  Legal Opinions.	79
	(g)  Approvals.	79
	(h)  Litigation.	79
	(i)  Officer's Certificate.	79
	(j)  Adverse Change.	79
6.3	Certain Conditions Precedent to Each Loan.	80
	(a)  Representations and Warranties.	80
	(b)  No Events of Default.	80
	(c)  Available Revolving Commitment.	80
	(d)  Other Matters.	80
ARTICLE VII	81
7.1	Financial Statements.	81
7.2	Certificates; Other Information.	82
	(a)  Accountant's Certificates.	82
	(b)  Officer's Certificate.	82
	(c)  Budgets; Projections.	82
	(d)  Audit Reports and Statements.	82
	(e)  Public Filings.	83
	(f)  Status.	83
	(g)  Other Requested Information	83
	(h)  Borrowing Base Certificate	83
7.3	Notices.	83
	(a)  Event of Default or Unmatured Event of Default.	83
	(b)  Litigation and Related Matters.	83
	(c)  Notice of Change of Control.	83
7.4	Conduct of Business and Maintenance of Existence.	84
7.5	Payment of Obligations.	84
7.6	Inspection of Property, Books and Records.	84
7.7	ERISA.	85
7.8	Insurance.	86
7.9	Environmental Laws.	86
7.10	Additional Subsidiary Guarantors.	87
7.11	Intentionally Omitted.	87
7.12	Additional Security; Further Assurances.	87
	(a)  Additional Subsidiary Guarantors.	87
	(b)  Pledge of New Subsidiary Stock.	87
	(c)  Grant of Security by New Domestic Subsidiaries.	87
	(d)  Documentation for Additional Security.	87
	(e)  Foreign Subsidiaries Security.	88
	(f)  Agreement to Grant Additional Security	88
7.13	Pledge of BV1	88
7.14	Third Party Consultant	89
7.15	Field Audit	89
7.16	Operating Accounts and Deposit Accounts	89
ARTICLE VIII	90
8.1	Financial Condition Covenants.	90
	(a)  Maintenance of Consolidated Net Worth.	90
	(b)  Leverage Ratio.	90
	(c)  Interest Coverage Ratio.	90
	(d)  Capital Expenditures.	91
8.2	Indebtedness.	91
8.3	Liens.	92
8.4	Fundamental Changes.	92
8.5	Restricted Payments.	93
8.6	Distributions from Subsidiaries.	93
8.7	Sales of Assets and Subsidiary Stock.	93
8.8	Investments.	94
8.9	Transactions with Affiliates.	94
8.10	Sale-Leasebacks.	94
8.11	Fiscal Year.	94
8.12	Amendments to Organizational Documents.	94
8.13	Accounting Changes.	94
8.14	Lines of Business.	94
8.15	Limitation on Voluntary Payments	94
ARTICLE IX	95
9.1	Events of Default.	95
	(a)  Failure to Make Payments When Due.	95
	(b)  Representations.	95
	(c)  Breach of Certain Covenants.	95
	(d)  Other Defaults Under Agreement or Loan Documents.	95
	(e)  Default Under Other Agreements.	95
	(f)  Judgments.	96
	(g)  Voluntary Insolvency, Etc.	96
	(h)  Involuntary Insolvency, Etc.	96
	(i)  Unenforceability.	96
	(j)  ERISA.	96
	(k)  Change of Control.	97
	(l)  Environmental Default.	97
	(m)  Security Documents.	97
9.2	Rescission of Acceleration.	98
9.3	Rights Not Exclusive.	98
ARTICLE X	99
10.1	Appointment and Authorization.	99
10.2	Nature of Duties.	99
10.3	Liability of Agent.	99
10.4	Reliance by Agent.	100
10.5	Notice of Default.	100
10.6	Credit Decision.	101
10.7	Indemnification.	101
10.8	Agent in Individual Capacity.	102
10.9	Resignation by Agent.	102
10.10	Documentation Agent.	103
ARTICLE XI	103
11.1	No Waiver; Modifications in Writing.	103
11.2	Intentionally omitted.	105
11.3	Notices, Etc.	105
11.4	Costs, Expenses and Taxes; Indemnity.	105
	(a)  Generally.	105
	(b)  Indemnification.	106
11.5	Confirmations.	108
11.6	Transfer of Notes.	108
11.7	Adjustments; Setoff.	108
11.8	Execution in Counterparts.	110
11.9	Binding Effect; Assignment; Addition and Substitution of Lenders.	110
11.10	CONSENT TO JURISDICTION; MUTUAL WAIVER OR JURY TRIAL.	112
11.11	Governing Law.	113
11.12	Registry.	113
11.13	Severability of Provisions.	114
11.14	Headings.	114
11.15	Independent Nature of Lenders' Rights.	114
11.16	Survival of Representations.	114
11.17	Confidentiality.	114
11.18	Effectiveness.	115
11.19	Waiver of Immunities.	115
11.20	Concerning the Collateral and the Loan Documents.	115
	(a)  Authority.	115
	(b)  Release of Collateral.	116
	(c)  No Obligation.	117

Schedules
Schedule 2.1(a)(i)	--	Converted Term Loan Amounts
Schedule 2.1(a)(ii)	--	Original Term Loan, Term A Loan and Term B Loan Amounts
Schedule 2.9(a)(i)	--	Existing Letters of Credit
Schedule 2.1(b)	--	Revolving Commitments
Schedule 5.5	--	Subsidiaries
Schedule 5.6	--	Indebtedness
Schedule 5.7(c)	--	Liabilities
Schedule 5.7(d)	--	Projections
Schedule 5.22	--	Deposit Accounts
Schedule 8.2(c)	--	Outstanding Subsidiary Indebtedness
Schedule 8.3	--	Permitted Liens
Schedule 8.6(a)	--	Certain Restrictions
Schedule 11.3	--	Addresses for Notice; Payment and Lending Offices
Exhibits
Exhibit 2.2(a)-1(a)	--	Form of Term A Note
Exhibit 2.2(a)-1(b)	--	Form of Term B Note
Exhibit 2.2(a)-2	--	Form of Revolving Note
Exhibit 2.2(a)-3	--	Form of Swing Line Note
Exhibit 2.5	--	Form of Notice of Borrowing
Exhibit 2.6	--	Form of Notice of Conversion or Continuation
Exhibit 2.9	--	Form of Letter of Credit Request
Exhibit 4.6(d)	--	Form of Section 4.6(d)(ii) Certificate
Exhibit 6.1(a)(iii)(x)	--	Form of Borrower Security Agreement
Exhibit 6.1(a)(iii)(y)	--	Form of Subsidiary Guarantor Security Agreement
Exhibit 6.1(a)(iv)	--	Form of Pledge Agreement
Exhibit 6.1(a)(v)	--	Form of Subsidiary Guarantee Agreement
Exhibit 6.1(a)(vi)(i)	--	Form of Ramsey Mortgage
Exhibit 6.1(a)(vi)(ii)	--	Form of Ramsey Mortgage Title Insurance Commitment
Exhibit 6.1(f)(i)	--	Form of Opinion of Borrower's general counsel
Exhibit 6.1(f)(ii)	--	Form of Opinion of Borrower's outside counsel
Exhibit 6.1(f)(iii)	--	Form of Opinion of Borrower's outside real estate counsel
Exhibit 6.1(i)	--	Form of Officer's Certificate
Exhibit 6.2(a)(vi)(i)	--	Form of Cortland Mortgage
Exhibit 6.2(a)(vi)(ii)	--	Form of Cortland Mortgage Title Insurance Commitment
Exhibit 6.2(f)(i)	--	Form of Opinion of Borrower's outside counsel
Exhibit 6.2(f)(ii)	--	Form of Opinion of Borrower's general counsel
Exhibit 6.2(i)	--	Form of Officer's Certificate
Exhibit 7.2(b)	--	Form of Certificate of Financial Officer
Exhibit 7.2(h)	--	Form of Borrowing Base Certificate

THIRD AMENDED AND RESTATED CREDIT AGREEMENT

    THIS THIRD AMENDED AND RESTATED CREDIT AGREEMENT (the "Third Amended and Restated Credit Agreement"), dated as of September 27, 2002, among BMC Industries, Inc., a Minnesota corporation ("Borrower"), the several banks and other financial institutions set forth on the signature pages hereto, DEUTSCHE BANK TRUST COMPANY AMERICAS (formerly named Bankers Trust Company), as administrative agent for the Lenders hereunder (in such capacity, the "Agent") and as a Lender, and Bank One, NA, as Documentation Agent and a Lender.

W I T N E S S E T H:

    WHEREAS, Borrower, Agent, the financial institutions party thereto and NBD Bank, as Documentation Agent, have entered into that certain Credit Agreement dated as of May 15, 1998 (the "Original Credit Agreement") providing for revolving credit facilities for working capital and other corporate purposes to Borrower as the same was amended and restated as of June 25, 1998 (as the same was previously amended prior to the date hereof, the "First Amended and Restated Credit Agreement");

    WHEREAS, Borrower, Agent, Documentation Agent and the financial institutions party thereto have entered into that certain amendment to the First Amended and Restated Credit Agreement dated as of October 12, 2001 (the "Second Amendment and Restatement Agreement");

    WHEREAS, the parties hereto wish to amend the First Amended and Restated Credit Agreement (as previously amended by the Second Amendment and Restatement Agreement) in the manner set forth in each corresponding or new section below to (i) convert the Term Loans outstanding thereunder into two new tranches of term loans; (ii) to permanently reduce the Revolving Commitment by $25,000,000 with the resulting Revolving Commitment on the Third Amended and Restated Effective Date being $35,000,000; and (iii) to extend the Termination Date and the maturity date of the Term Loans to May 14, 2004 and to make certain other modifications as set forth below;

    NOW, THEREFORE, in consideration of the premises and of the mutual covenants herein contained, the parties hereto agree that the First Amended and Restated Credit Agreement (as amended by the Second Amendment and Restatement Agreement) is hereby further amended by the modifications or additions in each corresponding or new section, schedule or exhibit set forth below:

ARTICLE I
 DEFINITIONS

    1.1    Defined Terms.  As used in this Agreement, the following terms shall have the following meanings, such meanings to be equally applicable to both the singular and plural forms of the terms defined:

     "Accounts Receivable" means presently existing and hereafter arising or acquired accounts receivable, notes, drafts, acceptances, choses in action and other forms of obligations and receivables relating in any way to Inventory or arising from the sale of Inventory (or goods previously sold that would be Inventory but for the fact that such goods have been sold)  or the rendering of services or the receipt of royalty payments by the Borrower or any of its Subsidiaries or howsoever otherwise arising, including the right to payment of any interest or finance charges with respect thereto and all proceeds of insurance with respect thereto, together with all of the Borrower's and such Subsidiaries' rights as an unpaid vendor, all pledged assets, guaranty claims, liens and security interests held by or granted to the Borrower or such Subsidiary to secure payment of any Accounts Receivable and all books, customer lists, ledgers, records and files (whether written or stored electronically) relating to any of the foregoing.

    "Acquisition": any transaction or series of related transactions for the purpose of or resulting, directly or indirectly, in (a) the acquisition of all or substantially all of the assets of a Person, or of any business or division of a Person, (b) the acquisition of in excess of 50% of the capital stock, partnership interests, membership interests or equity of any Person, or otherwise causing any Person to become a Subsidiary, or (c) a merger or consolidation or any other combination with another Person (other than a Person that is a Subsidiary) provided that the Borrower or the Subsidiary is the surviving entity.

 "Additional Security Documents": all mortgages, pledge agreements, security agreements and other security documents entered into pursuant to Section 7.12 and the Security Agreement.

"Adjusted Working Capital": the difference between (i) Consolidated Current Assets and (ii) Consolidated Current Liabilities excluding from Consolidated Current Liabilities all short-term borrowings, the current portion of long-term indebtedness and the current portion of Capitalized Lease Obligations.

"Adjustment Date": the earlier of (i) the second Business Day after receipt by Agent of the financial statements required to be delivered by Borrower pursuant to Section 7.1 and (ii) the date five days after notice from Agent to Borrower that Borrower has failed to deliver such financial statements; provided that if an Adjustment Date pursuant to clause (ii) occurs, the date which is the Second Business Day after Agent does receive such financial statements shall also be an Adjustment Date.

"Agent": as defined in the preamble.

"Agents": the Agent and the Documentation Agent.

"Affiliate": with respect to any Person, any Person or group acting in concert in respect of the Person in question that, directly or indirectly, controls or is controlled by or is under common control with such Person.  For the purposes of this definition, "control" (including, with correlative meanings, the terms "controlled by" and "under common control with") shall mean the possession, directly or indirectly, of the power to direct or cause the direction of management and policies of a Person, whether through the ownership of voting securities or by contract or otherwise.

"Agent‑Related Persons": as defined in Section 10.3.

"Aggregate Commitment": the sum of (a) the Total Revolving Commitment, and (b) the aggregate outstanding Term Loans of the Term Lenders.

"Aggregate Consideration": the aggregate value of all cash, securities and other property paid in connection with an Acquisition, including all Indebtedness of the acquired Person repaid or assumed, directly or indirectly (by operation of law or otherwise) in connection with the Acquisition.

"Aggregate Converted Term Loan Amount"  means the sum of the Converted Term Loan Amounts of all Converting Lenders on the Restatement Date.

"Agreement": this Agreement, as amended, supplemented or otherwise modified from time to time.

 "Applicable Commitment Fee": at any date, shall equal .750%.

"Applicable Margin": means (i) at any time prior to July 1, 2003, (a) 2.250% with respect to Revolving Loans and Term A Loans which are Base Rate Loans or Unpaid Drawings and 3.250% with respect to Revolving Loans and Term A Loans which are Eurodollar Loans; and (b) 4.750% with respect to Term B Loans which are Base Rate Loans and 5.750% with respect to Term B Loans which are Eurodollar Loans; and (ii) at any time on or after July 1, 2003, (a) 2.750% with respect to Revolving Loans and Term A Loans which are Base Rate Loans or Unpaid Drawings and 3.750% with respect to Revolving Loans and Term A Loans which are Eurodollar Loans; and (b) 5.250% with respect to Term B Loans which are Base Rate Loans and 6.250% with respect to Term B Loans which are Eurodollar Loans.

"Asset Acquisition": the purchase by Borrower of the assets of the Orcolite business unit, an operating division of the Monsanto Corporation in 1998.

"Asset Acquisition-Related and Other Special Charges": means charges taken in 1998 for accounting purposes in connection with the Asset Acquisition to reflect write-offs, costs, expenses or other charges related to the Asset Acquisition and other special non-recurring non cash accounting charges (provided that no more than $2,000,000 may be cash severance payments) in 1998 not to exceed $65,000,000 in the aggregate.

"Asset Disposition": any sale, lease, transfer or other disposition (or series of related sales, leases, transfers or dispositions) of shares of Capital Stock of a Subsidiary of Borrower (other than directors' qualifying shares), property or other assets (each referred to for the purposes of this definition as a "disposition") by Borrower or any of its Subsidiaries the fair market value of which, as determined in good faith by the board of directors of Borrower or such Subsidiary, as the case may be, exceeds $1,000,000 (other than (i) a disposition by a Subsidiary to Borrower or by Borrower or a Subsidiary to a Wholly-Owned Subsidiary, (ii) a disposition of property or other assets at fair market value in the ordinary course of business, including non-exclusive licenses to use trademarks, trade names or other similar property of Borrower or its Subsidiaries and (iii) a disposition of obsolete property or other assets in the ordinary course of business).

"Assignee": an Eligible Assignee which is an "Assignee" party to an Assignment and Assumption Agreement pursuant to Section 11.9.

"Assignment and Assumption Agreement": an Assignment and Assumption Agreement substantially in the form of Exhibit 11.9 annexed hereto and made a part hereof made by any applicable Lender, as assignor and such Lender's assignee in accordance with Section 11.9, with such modifications (including, without limitation, additional representations, warranties and covenants by the assignor Lender or assignee Lender) as such assignor Lender and assignee Lender may agree to from time to time which solely affect the relative rights and/or obligations of the assignor Lender and assignee Lender as between themselves.

"Attorney Costs": all reasonable fees and disbursements of any law firm or other external counsel and the reasonable allocated cost of internal legal services, including all reasonable disbursements of internal counsel.

"Attributable Debt": as of the date of determination thereof in connection with a Sale and Leaseback Transaction occurring after the Closing Date, the greater of (1) the fair value of the assets subject to such transaction (as determined in good faith by the applicable lessee) and (2) the present value (discounted according to GAAP at the cost of debt implied in the lease) of the obligations of the lessee for rental payments during the term of any applicable lease.

"Available Revolving Commitment": as to any Lender at any time, an amount in Dollars equal to the excess, if any, of (a) such Lender's Revolving Commitment over (b) the sum of (i) the aggregate principal amount then outstanding of Revolving Loans made by such Lender and (ii) such Lender's Commitment Percentage of the LC Obligations and Commitment Percentage of the Swing Line Loans then outstanding.

"Bankruptcy Code": Title 11 of the United States Code entitled Bankruptcy as now or hereafter in effect or any successor thereto.

"Base Rate": the higher of (i) the Prime Lending Rate and (ii) the Federal Funds Effective Rate plus one‑half of one percent (½½%).

"Base Rate Loans": Loans bearing interest at a rate determined by reference to the Base Rate, or Swing Line Loans, as the context shall require.

"Board": the Board of Governors of the Federal Reserve System (or any successor thereto).

"Borrower": as defined in the preamble.

"Borrower Security Agreement": as defined in Section 6.1(a)(iii).

"Borrowing": a group of Loans of a single Type made by the Lenders or the Swing Line Lender, as appropriate, on a single date and as to which a single Interest Period is in effect.

"Borrowing Base" means at any time the sum of (a) eighty-five percent (85%) of the outstanding amount of Eligible Receivables and (b) fifty-five percent (55%) of the value of Eligible Inventory, in each case as determined from the Borrowing Base Certificate most recently delivered and updated pursuant to subsection 7.2(h); provided, however, that the Borrowing Base shall be deemed to be no more than $30 million until delivery of the Field Audit.

 "Borrowing Base Certificate" has the meaning assigned to that term in subsection 7.2(h).

 "Business Day": a day other than a Saturday, Sunday or other day on which commercial banks in New York City are authorized or required by law to close; provided, however, that when used in connection with a Eurodollar Loan, the term "Business Day" shall also exclude any day on which banks are not open for dealings in dollar deposits in the London interbank market.

"Capital Expenditures": without duplication, with respect to any Person, any amounts expended or Indebtedness incurred during or in respect of a period for any purchase or other acquisition for value of any asset that should be classified on a consolidated balance sheet of such Person prepared in accordance with GAAP as a fixed or capital asset including, without limitation, the direct or indirect acquisition of such assets or improvements by way of increased product or service charges, offset items or otherwise, and shall include Capitalized Lease Obligations and shall include amounts expended, incurred or obligated to be expended during or in respect of a period for any Permitted Acquisition or Permitted Investment regardless of whether such Permitted Acquisition or Permitted Investment would be classified as fixed or capital assets on a consolidated balance sheet of such Person prepared in accordance with GAAP.

"Capital Lease": as applied to any Person, any lease of any property (whether real, personal or mixed) by that Person as lessee which would, in conformity with GAAP, be required to be accounted for as a capital lease on the balance sheet of that Person.

"Capital Stock": with respect to any Person, any and all shares, interests, participations, rights in or other equivalents (however designated) of such Person's capital stock, partnership interests, membership interests or other equivalent interests and any rights (other than debt securities convertible into or exchangeable for capital stock or such interests), warrants or options exchangeable for or convertible into such capital stock or other interests.

"Capitalized Lease Obligation": at the time any determination thereof is to be made, the amount of the liability in respect of a Capital Lease which would at such time be so required to be capitalized on such a balance sheet in accordance with GAAP.

"Cash": means money, currency or the available credit balance in a Deposit Account.

"Cash Equivalents": Investments of the type specified in clauses (i), (ii), (iii), (iv)  and (ix) of the definition of "Permitted Investments".

"Change of Control": (i) the sale, lease or transfer of all or substantially all of Borrower's assets to any Person or group (as such term is used in Section 13(d)(3) of the Exchange Act), (ii) the liquidation or dissolution of Borrower, (iii) any person or group of persons (within the meaning of the Exchange Act) acquiring beneficial ownership (within the meaning of Rule 13d-3 promulgated by the SEC under the Exchange Act) of 20% or more of the issued and outstanding shares of Borrower's Voting Securities; or (iv) a majority of the directors of the Borrower are Persons other than Persons (A) for whose election proxies have been solicited by Borrower's board of directors or (B) who are then serving as directors appointed by Borrower's board of directors to fill vacancies on the Board caused by death or resignation (but not by removal) or to fill new created directorships.

"Closing Date" May 15, 1998.

"Code": the Internal Revenue Code of 1986, as amended from time to time.

"Collateral" means all "Collateral" as defined in each of the Security Documents.

"Collateral Account": as defined in Section 4.3(a).

"Collateral Agent": the Agent acting as collateral agent for the Secured Creditors.

"Commercial Letter of Credit": means any letter of credit or similar instrument issued for the account of Borrower pursuant to this Agreement for the purpose of supporting trade obligations of Borrower or any of its Domestic Subsidiaries in the ordinary course of business.

 "Committed Loan": any Revolving Loan, Term Loan or Swing Line Loan.

"Commitment": as to any Lender at any time, the aggregate of such Lender's outstanding Revolving Commitment and its Swing Line Commitment.

"Commitment Percentage": means, as to any Lender, (a) in respect of a particular Loan and/or Commitment, (i) at any time at which the Commitments in respect of such Loan remain outstanding, the percentage equivalent (expressed as a decimal, rounded to the ninth decimal place) at such time of such Lender's Commitment in respect of such Loan divided by the combined Commitments in respect of such Loan; and (ii) after the termination of the Commitments in respect of such Loan or in respect of any Term Loan, the percentage equivalent (expressed as a decimal, rounded to the ninth decimal place) at such time of the principal amount outstanding of such Loans held by such Lender divided by the aggregate principal amount outstanding of such Loans held by all Lenders, and (b) in respect of all Loans and/or Commitments, (i) at any  time at which the Aggregate Commitments (or any portion thereof) remains outstanding, the percentage equivalent (expressed as a decimal, rounded to the ninth decimal place) at such time of the sum of such Lender's Revolving Commitments and such Lender's outstanding Term Loans divided by the Aggregate Commitment, and (ii) after the termination of the Revolving Commitments, the percentage equivalent (expressed as a decimal, rounded to the ninth decimal place) at such time of the principal amount of such Lender's outstanding Loans and LC Obligations divided by the aggregate principal amount of the outstanding Loans and LC Obligations of all of the Lenders. 

"Commitment Period": the period from and including the date hereof to but not including the Termination Date.

"Commodity Price Protection Agreement": any Contractual Obligation or other arrangement designed to protect Borrower or any of its Subsidiaries from fluctuations in the price of commodities.

 "Consolidated Capital Expenditures": for any period, the aggregate of all Capital Expenditures by Borrower and its Subsidiaries during that period that, in conformity with GAAP, are included in "additions to property, plant or equipment" or comparable items reflected in the consolidated statement of cash flows of Borrower and its Subsidiaries.

"Consolidated Current Assets": with respect to any Person, as at the time any determination thereof is to be made, the amount, without duplication, that is classified on a consolidated balance sheet of such Person and its Subsidiaries as the consolidated current assets of such Person and its Subsidiaries in accordance with GAAP.

"Consolidated Current Liabilities": with respect to any Person, as at the time any determination thereof is to be made,  any indebtedness (other than the Indebtedness hereunder) that is classified as consolidated current liabilities on a consolidated balance sheet of such Person and its Subsidiaries in accordance with GAAP.

"Consolidated Debt": indebtedness for money borrowed of Borrower and its Subsidiaries that should be shown as a liability on a consolidated balance sheet of Borrower and its Subsidiaries prepared in accordance with GAAP plus, without duplication, the amount of Indebtedness of the type described in clauses (iii), (v), (ix) and (x) of the definition thereof plus, without duplication, Attributable Debt.

"Consolidated EBITDA": without duplication for any Person for any period for which such amount is being determined, Consolidated Net Income or Consolidated Net Loss for such period minus Second Quarter 2001 Deferred Tax Charges for such period, if any, plus the sum of the amounts for such period of (i) Consolidated Interest Expense, (ii) provision for taxes based on income, (iii) depreciation expense, and (iv) amortization expense minus any non-cash non-operating income for such period to the extent included in Consolidated Net Income or Consolidated Net Loss and excluding any gain or loss recognized in respect of post-retirement benefits as a result of the application of FASB 106 and any foreign currency translation adjustments as a result of the application of FASB 52, all as determined on a consolidated basis for such Person and its consolidated Subsidiaries in accordance with GAAP.  For purpose of this definition, "Consolidated EBITDA" shall be calculated after giving effect on a pro forma basis to any Acquisition as if such Acquisition occurred on the first day of the applicable period on the same basis as is required in clauses (A) through (C) for the pro forma test under clause (iii) of the definition of Permitted Acquisition.

"Consolidated Interest Expense": with respect to any Person, for any period for which such amount is being determined, total interest expense of such Person and its Subsidiaries on a consolidated basis in accordance with GAAP for such period.

"Consolidated Net Income" and "Consolidated Net Loss": for any Person for any period for which such amount is being determined, the net income (loss) of such Person and its consolidated Subsidiaries during such period determined on a consolidated basis for such period taken as a single accounting period in accordance with GAAP, provided that in making such determination there shall be excluded any effect of (i) income (or loss) of any Person (other than a consolidated Subsidiary of such Person) in which any other Person (other than such Person or any of its consolidated Subsidiaries) has a joint interest, except to the extent of the amount of dividends or other distributions actually paid to such Person or any of its consolidated Subsidiaries by such other Person during such period, (ii) the income (or loss) of any Person accrued prior to the date it becomes a consolidated Subsidiary of such Person or is merged into or consolidated with such Person or any of its consolidated Subsidiaries or the Person's assets are acquired by such Person or any of its consolidated Subsidiaries, (iii) the income of any consolidated Subsidiary of such Person to the extent that the declaration or payment of dividends or similar distributions by that consolidated Subsidiary of the income is not at the time permitted by operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to that consolidated Subsidiary, (iv) Asset Acquisition-Related and Other Special Charges, (v) Third Quarter 2001 Non-Recurring Charges; (vi) Restructuring Charges; (vii) the Second Quarter 2001 Deferred Tax Charges; and (viii) to the extent deducted from determining Consolidated Net Income, any non-cash charge required as a result of the application of FASB 142.

"Consolidated Net Worth": of a Person means total stockholders' equity of such Person and its Subsidiaries on a consolidated basis in accordance with GAAP plus, without duplication, Asset Acquisition-Related and Other Special Charges plus, without duplication, the Second Quarter 2001 Deferred Tax Charges plus, without duplication, Third Quarter 2001 Non-Recurring Charges plus, without duplication, Restructuring Charges plus, without duplication and only to the extent deducted in the determination of stockholder's equity, any non-cash charge required as a result of the application of FASB 142; provided, however, notwithstanding anything in the definitions thereof to the contrary, Asset Acquisition-Related and Other Special Charges, Second Quarter 2001 Deferred Tax Charges, Third Quarter 2001 Non-Recurring Charges and Restructuring Charges shall be considered in calculating Consolidated Net Worth for purposes of Section 8.1(a) on an ongoing basis without duplication and only to the extent previously deducted in the determination of stockholder's equity.

"Contaminant": any material with respect to which any Environmental Law imposes a duty or obligation, including without limitation any pollutant, contaminant (as those terms are defined in 42 U.S.C. §9601(33)), toxic pollutant (as that term is defined in 33 U.S.C. §1362(13)), hazardous substance (as that term is defined in 42 U.S.C. §9601(14)), hazardous chemical (as that term is defined by 29 CFR § 1910.1200(c)), hazardous waste (as that term is defined in 42 U.S.C. § 6903(5)), or any state or local equivalent of such laws and regulations, including, without limitation, radioactive material, special waste, polychlorinated biphenyls, asbestos, petroleum, including crude oil or any petroleum-derived substance, (or any fraction thereof), waste, or breakdown or decomposition product thereof, or any constituent of any such substance or waste, including but not limited to polychlorinated biphenyls and asbestos.

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

"Converted Term Loan Amount": as defined in Section 2.1(a)(i).

"Converting Lender" means each Lender which executed the Second Amendment and Restatement Agreement on or before the Restatement Date and each Lender who delivered a Term Loan Conversion Notice to the Agent on or before the Restatement Date.

"Cortland Mortgage": the form of Cortland Mortgage attached hereto as Exhibit 6.2(a)(vi) covering the Cortland, New York property of the Borrower as amended, restated, supplemented or otherwise modified from time to time.

"Cortland Mortgage Policy": any mortgage insurance policies, "marked up" mortgage title insurance commitment, items described in Exhibit 6.2(a)(vi)(ii) hereto or similar documents delivered pursuant to Section 5.19(b).

"Credit Event": the making of any Loan or the issuance of any Letter of Credit.

"Credit Party": Borrower, each Subsidiary Guarantor and any guarantor which may hereafter enter into a guarantee agreement with respect to the Obligations.

"Currency Protection Agreement": any foreign exchange contract, currency swap agreement, or other financial agreement or arrangement to which Borrower or any of its Subsidiaries is a party that is designed to protect Borrower or any of its Subsidiaries against fluctuations in currency values.

"DBTCA": Deutsche Bank Trust Company Americas (formerly named Bankers Trust Company).

"Debts": all liabilities, whether matured or unmatured, liquidated or unliquidated, absolute, fixed or contingent.

"Default Rate": a variable rate per annum which shall be two percent (2%) per annum plus either (i) the then applicable interest rate hereunder in respect of the amount on which the Default Rate is being assessed, or (ii) if there is no such applicable interest rate, the Base Rate plus the Applicable Margin, but in no event in excess of that permitted by applicable law.

"Defaulting Lender": any Lender with respect to which a Lender Default is in effect.

"Deposit Account" means any account held by a Person at a bank or other financial institution into which such Person deposits cash, checks, drafts or other similar items of payment relating to or constituting payments made in respect of any and all Collateral.

"Documents": the Loan Documents.

"Dollars" and "$": dollars in lawful currency of the U.S.

 "Domestic Subsidiary": any Subsidiary of Borrower that is not a Foreign Subsidiary.

"Drawing": as defined in Section 2.9(d)(ii).

"Effective Date": the effective date of the applicable Assignment and Assumption Agreement, as defined therein.

 "Eligible Assignee": (i) a commercial bank organized under the laws of the U.S., or any State thereof, (ii) a commercial bank organized under the laws of any other country which is a member of OECD, or a political subdivision of any such country; provided, however, that such bank is acting through a branch or agency located in the country in which it is organized or another country which is also a member of the OECD or the Cayman Islands, (iii) the central bank of any country which is a member of the OECD, (iv) a finance company or other financial institution or fund (whether a corporation, partnership, trust or other entity) that is engaged in making, purchasing or otherwise investing in commercial loans in the ordinary course of its business, (v) an insurance company organized under the laws of the U.S. (or any State thereof), (vi) a savings bank or savings and loan association organized under the laws of the U.S., or any State thereof, (vii) any Lender party to this Agreement, (viii) any Affiliate of any Lender party to this Agreement, and (ix) any other Person approved by Agent and Borrower, such approval not to be unreasonably withheld; provided, however, that an affiliate of Borrower shall not qualify as an Eligible Assignee.

"Eligible Inventory" means the Inventory of the Borrower and its Domestic Subsidiaries (valued at the lower of cost (determined on a first-in-first-out basis) or market) located in the continental United States as to which (a) the Borrower or a Domestic Subsidiary of the Borrower has acquired title, (b) the Collateral Agent has a first (subject only to statutory or common law non-consensual Liens constituting Permitted Liens) and perfected security interest and (c) such Person shall have furnished to the Agent information adequate for purposes of identification at times and in form and substance as may be reasonably requested by the Agent; provided, however, that such Inventory shall not constitute Eligible Inventory (i) if and when the Borrower or such Subsidiary sells it, otherwise passes title thereto or consumes it, (ii) if the Collateral Agent releases its security interest therein, or (iii) to the extent that it (A) is obsolete, not in good condition or not either currently useable or currently salable in the ordinary course of the Borrower's or such Subsidiary's business, (B) is produced in violation of the Fair Labor Standards Act and subject to the so-called "hot goods" provision contained in Title 29, §215(a) (1) of the United States Code, (C) is Inventory consisting of packaging material or supplies, (D) is Inventory consisting of work in progress, (E) is Inventory held for consumption (other than raw materials) by the Borrower or such Subsidiary and not for sale or lease in the ordinary course of business, (F) is Inventory which is subject to a Lien in favor of any Person other than the Collateral Agent (other than statutory or common law non-consensual Liens constituting Permitted Liens), (G) constitutes Inventory which is not located either (i) on the Borrower's or such Subsidiary's owned premises in the United States of America, (ii) on any leased premises in the United States of America provided that on any date occurring sixty days or more following the Third Amended and Restated Effective Date, Inventory under this subclause (G)(ii) shall, subject to the other provisions of this definition, constitute Eligible Inventory only in the event the same exists on leased premises in the United States of America where the landlord thereof has consented in writing to the Collateral Agent's prior Lien in such Inventory and the Collateral Agent's right to enter such premises and take possession and remove such Inventory pursuant to a landlord access and lien waiver in form and substance reasonably satisfactory to the Agent or (iii) in warehouses or with bailees in the United States of America where the warehousemen or bailee has consented in writing to the Collateral Agent's prior Lien in such Inventory and the Collateral Agent's right to enter such premises and take possession of and remove such Inventory, pursuant to an access and lien waiver in form and substance satisfactory to the Administrative Agent, (H) constitutes Inventory which is evidenced by an Eligible Receivable, or (I) is Inventory which is not in full conformity with the representations made by the Borrower and the Borrower's Subsidiaries with respect thereto in this Agreement or the Security Documents; provided, further, that nothing in the preceding clauses (F) or (G) shall exclude any Inventory from the definition of Eligible Inventory to the extent such Inventory would otherwise be considered Eligible Inventory hereunder (excluding the effect of such clauses (F) and (G)) and is Inventory consigned for sale by the Borrower or one of its Domestic Subsidiaries to a third party for which the Borrower or such Domestic Subsidiary has taken all steps reasonably required by the Collateral Agent to perfect Collateral Agent's security interest in such consigned Inventory (including without limitation completing all filings and notices required by Section 9-324 of the Uniform Commercial Code required to protect the Borrower's or such Domestic Subsidiary's interest in such consigned Inventory against lenders of the applicable consignee).  Any Inventory which is Eligible Inventory at any time, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be Eligible Inventory until such time as it once again meets all of the foregoing requirements.

"Eligible Receivables" means the Accounts Receivable of the Borrower and its Domestic Subsidiaries located in the continental United States as to which (a) the Collateral Agent has a first (subject only to statutory or common law non-consensual Liens constituting Permitted Liens) perfected security interest and (b) the Borrower shall have furnished to the Agent information adequate for purposes of identification at times and in form and substance as may be reasonably requested by the Agent; provided, however, that such Accounts Receivable shall not constitute Eligible Receivables if they (i) by their terms are not payable within ninety (90) days after the date of the applicable invoice with respect to shipped goods or they remain unpaid ninety (90) days after the original date of the applicable invoice; (ii) are Accounts Receivable owing by a single Accounts Receivable debtor in the event that fifty percent (50%) or more of the balance of Accounts Receivable owing by such Accounts Receivable debtor is ineligible by reason of the criteria set forth in clause (i) immediately preceding; (iii) are Accounts Receivable with respect to which the Accounts Receivable debtor is an Affiliate of the Borrower or such Subsidiary or a director, officer of employee of the Borrower or of such Subsidiary or such Affiliates; (iv) are Accounts Receivable with respect to which the Accounts Receivable debtor is not a resident of the United States of America other than such foreign account receivable secured by letters of credit or sight drafts reasonably acceptable to the Agent; provided that such letter of credit or sight draft is delivered and pledged to the Collateral Agent as additional Collateral; (v) are Accounts Receivable arising with respect to goods which have not been shipped or arising with respect to services which have not been fully performed; (vi) are Accounts Receivable which are not invoiced (and dated as of the date of such invoice) and sent to the Accounts Receivable debtor within a reasonable time consistent with reasonable business practices; (vii) are Accounts Receivable with respect to which the Borrower knows, or should reasonably know, that the Accounts Receivable debtor is the subject of a bankruptcy or a similar insolvency proceeding or has made an assignment for the benefit of creditors or whose assets have been conveyed to a receiver or trustee other than Accounts Receivable of such debtor arising after an order for relief has been entered in a case under Title 11 of the United States Code to the extent the payment of such Accounts Receivable has been approved in such case; (viii) are Accounts Receivable with respect to sales made on a bill-and-hold, guaranteed sale, sale-and-return, sale on approval, consignment or similar basis; (ix) are Accounts Receivable which are or may reasonably be expected to become subject to any right of setoff by the Accounts Receivable debtor but only (A) to the extent of such right of setoff and (B) if such Accounts Receivable debtor has not entered into an agreement with the Agent which is acceptable to the Agent with respect to the wavier of rights of setoff; or (x) are not in conformity with the representations and warranties made by the Borrower and the Borrower's  Subsidiaries with respect thereto in this Agreement or any Security Document; provided, further, that such Accounts Receivable which fail to meet any of the foregoing requirements shall be excluded from the calculation of Eligible Receivables without duplication.  Any Account Receivable which is at any time an Eligible Receivable, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Receivable until such time as it once again meets all of the foregoing requirements.

"Environmental Laws": any and all foreign, Federal, state, local or municipal laws, rules, orders, regulations, statutes, ordinances, codes or decrees of any Governmental Authority or other Requirements of Law regulating, relating to or imposing liability or standards of conduct concerning protection of human health or the environment, as now or may at any time hereafter be in effect that are applicable to the Borrower or its Subsidiaries.

"ERISA": the Employee Retirement Income Security Act of 1974, as amended from time to time.

"ERISA Affiliate": each trade or business (whether or not incorporated) which together with Borrower or a Subsidiary of Borrower would be deemed to be a "single employer" within the meaning of Section 4001(b)(1) of ERISA or would be included in a "controlled group of corporations," a group of "trades or businesses under common control" or an "affiliated service group" within the meaning of Section 414(b), (c), (m) or (o) of the Code.  Unless otherwise qualified, all references to an "ERISA Affiliate" in this Agreement shall refer to an ERISA Affiliate of Borrower or any Subsidiary.

"Eurocurrency Reserve Requirements": for any day as applied to a Eurodollar Loan, the aggregate (without duplication) of the maximum rates (expressed as a decimal fraction) of reserve requirements in effect on such day (including, without limitation, basic, supplemental, marginal and emergency reserves under any regulations of the Board or other Governmental Authority having jurisdiction with respect thereto) dealing with reserve requirements prescribed for Eurocurrency funding (currently referred to as "Eurocurrency liabilities" in Regulation D of such Board) maintained by a member bank of the Federal Reserve System.

"Eurodollar Borrowing": a Borrowing comprised of Eurodollar Loans.

"Eurodollar Loan": any Loan bearing interest at a rate determined by reference to the Eurodollar Rate.

"Eurodollar Rate": the arithmetic average (rounded upwards to the nearest 1/16 of 1%) of the offered quotations, if any, to first class banks in the Eurodollar market by DBTCA for Dollar deposits of amounts in immediately available funds comparable to the principal amount of the applicable Eurodollar Loan for which the Eurodollar Rate is being determined with maturities comparable to the Interest Period for which such Eurodollar Rate will apply, as of approximately 10:00 A.M. (New York City time) on the applicable Interest Rate Determination Date.  The determination of the Eurodollar Rate by Agent shall be conclusive and binding on Borrower absent demonstrable error.

"Eurodollar Reserve Rate": with respect to each day during each Interest Period pertaining to a Eurodollar Loan, a rate per annum determined for such day in accordance with the following formula (rounded upward to the nearest 1/100th of 1%):

                   Eurodollar Rate                                   
1.00 ‑ Eurocurrency Reserve Requirements

"European Reorganization" has the meaning assigned to that term in that certain Consent, Waiver and Fourth Amendment to Credit Agreement dated as of December 21, 1999 by and among the Borrower, the Agent and the Lenders signatory thereto.

"Event of Default": any of the events specified in Section 9.1; provided, however, that any requirement for the giving of notice, the lapse of time, or both, or any other condition, has been satisfied.

"Excess Cash Flow": for any period, the excess of (i) the sum of (without duplication) (A) Consolidated Net Income for such period, plus (B) the amount of all non-cash charges (including, without limitation or duplication, depreciation, amortization and non-cash (including without limitation any original issue discount or pay-in-kind interest expense) interest expense) included in determining Consolidated Net Income for such period, plus (C) the decrease, if any, in Adjusted Working Capital from the first day to the last day of such period, plus (D) provisions for taxes appearing on an income statement of Borrower and its Subsidiaries for such period, over (ii) the sum (without duplication) of (A) any non-cash credits (including from sales of assets) included in determining Consolidated Net Income for such period, plus (B) gains from sales of assets included in determining Consolidated Net Income for such period, plus (C) the aggregate amount of Capital Expenditures (excluding Capital Expenditures made utilizing insurance proceeds from Recovery Events or financed through Indebtedness (other than Indebtedness under this Agreement)), plus (D) the aggregate principal amount of permanent principal payments of Indebtedness for borrowed money of Borrower and its Subsidiaries (other than (1) repayment of Indebtedness with proceeds of issuance of other Indebtedness or equity or equity contributions or with Net Sale Proceeds or Recovery Events and (2) repayment of Loans, provided that repayments of Loans shall be deducted in determining Excess Cash Flow if such repayments were (x) required as a result of a Scheduled Term Repayments under Section 4.4(e) or were repayments of Loans on the Termination Date, (y) made as a voluntary prepayment with internally generated funds (but in the case of a voluntary prepayment of Revolving Loans or Swing Line Loans, only to the extent accompanied by a voluntary permanent reduction to the Total Revolving Commitment) or (z) made with Net Sale Proceeds from any Asset Disposition but only to the extent that any gain from such Asset Disposition has been included in the determination of Consolidated Net Income for such period) during such period, plus (E) non-cash charges added back in a previous period pursuant to clause (i)(B) above to the extent any such charge has become a cash item in the current period, plus (F) the increase, if any, in Adjusted Working Capital from the first day to the last day of such period, plus (G) taxes paid by Borrower and its Subsidiaries during such period, plus (H) the principal portion of Capitalized Lease Obligations paid by Borrower and its Subsidiaries during such period.

"Excess Cash Flow Period": with respect to the repayment required on each Excess Cash Payment Date, the immediately preceding Fiscal Year of Borrower; provided, however, that with respect to the Fiscal Year ended December 31, 2002, there shall be used in determining Excess Cash Flow for such Fiscal Year only the period between the Third Amended and Restated Effective Date and December 31, 2002.

 "Excess Cash Payment Date": the date occurring 95 days after the last day of a Fiscal Year of Borrower (beginning with its Fiscal Year ending on December 31, 2002).

"Exchange Act": the Securities Exchange Act of 1934, as amended and codified in U.S.C. 78a et seq. and as hereafter amended from time to time.

"Exchangeable Stock": any Capital Stock which is exchangeable or convertible into another security (other than Capital Stock of Borrower which is neither Exchangeable Stock nor Redeemable Stock).

"Existing Credit Agreements": that certain Credit Agreement among BMC Industries, Inc., various Banks and Norwest Bank Minnesota, National Association, dated June 5, 1996, as amended to date, and all agreements relating to such loan agreement, including, without limitation, any and all guarantees, pledge agreements and security agreements.

 "Facility": any of the credit facilities established under this Agreement.

"Facing Agent": means (i) for Standby Letters of Credit, DBTCA and (ii) for Commercial Letters of Credit any Revolving Lender, other than DBTCA, which at the request of the Borrower and with the written approval of the Agent, agrees to issue Commercial Letters of Credit.

"Federal Funds Effective Rate": for any period, a fluctuating interest rate per annum equal for each day during such period to 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 for such day (or, if such day is not a Business Day, for the next preceding 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 DBTCA, as Agent, from three Federal funds brokers of recognized standing selected by it.

"Field Audit": as defined in Section 7.15.

"Financial Officer": with respect to any Person, the chief financial officer, principal accounting officer, a financial vice president, treasurer or assistant treasurer of such Person.

"Foreign Subsidiary": a Subsidiary of Borrower that is incorporated under the laws of a jurisdiction other than any State of the U.S. or the District of Columbia.

"GAAP": generally accepted accounting principles in the U.S. as in effect from time to time.  If any changes in GAAP or the application thereof from that used in the preparation of the financial statements referred to in Section 7.1(a) hereof occur after the Closing Date and such changes result in a material change in the calculation of any financial covenants or restrictions set forth in this Agreement, then the parties hereto agree to enter into and diligently pursue negotiations in order to amend such financial covenants and restrictions so as to equitably reflect such changes, with the desired result that the criteria for evaluating the financial condition and results of operations of Borrower and its Subsidiaries shall be the same after such changes as if such changes had not been made.

"Governmental Authority": any nation or government, any state or other political subdivision thereof and any entity exercising executive, legislative, judicial, regulatory or administrative functions of government.

"Guarantee Obligations": as to any Person, without duplication, any direct or indirect obligation of such Person guaranteeing or intended to guarantee any Indebtedness, Capital Lease or operating lease, dividend or other obligation ("primary obligations") of any other Person (the "primary obligor") in any manner, whether directly or indirectly, including, without limitation, any obligation of such Person, whether or not contingent:  (i) to purchase any such primary obligation or any property constituting direct or indirect security therefor; (ii) to advance or supply funds (a) for the purchase or payment of any such primary obligation, or (b) to maintain working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency of the primary obligor; (iii) to purchase property, securities or services primarily for the purpose of assuring the owner of any such primary obligation of the ability of the primary obligor to make payment of such primary obligation; or (iv) otherwise to assure or hold harmless the owner of such primary obligation against loss in respect thereof; provided, however, that the term Guarantee Obligation shall not include any endorsements of instruments for deposit or collection in the ordinary course of business.  The amount of any Guarantee Obligation of any Person at any time shall be deemed to be an amount equal to the lesser at such time of (y) the stated or determinable amount of the primary obligation in respect of which such Guarantee Obligation is made or (z) the maximum amount for which such Person may be liable pursuant to the terms of the instrument embodying such Guarantee Obligation; or, if not stated or determinable, the maximum reasonably anticipated liability (assuming full performance) in respect thereof.     

"Indebtedness": as applied to any Person (without duplication):

(i)     all indebtedness of such Person for borrowed money;

(ii)     the deferred and unpaid balance of the purchase price of assets or services (other than trade payables and other accrued liabilities incurred in the ordinary course of business that are not overdue by more than 90 days unless being contested in good faith) which purchase price is (y) due more than six months from the date of incurrence of the obligation in respect thereof or (z) evidenced by a note or a similar written instrument;

(iii)    that portion of obligations of such Person with respect to Capital Leases which is required to be classified as a liability on a balance sheet in accordance with GAAP;

(iv)    all indebtedness secured by any Lien on any property owned by such Person, whether or not such indebtedness has been assumed by such Person or is nonrecourse to such Person;

(v)     notes payable and drafts accepted representing extensions of credit whether or not representing obligations for borrowed money (other than such notes or drafts for the deferred purchase price of assets or services which does not constitute Indebtedness pursuant to clause (ii) above);

(vi)    indebtedness or obligations of such Person, in each case, evidenced by bonds, notes or similar written instrument;

(vii)    the face amount of all letters of credit and bankers' acceptances issued for the account of such Person, and without duplication, all drafts drawn thereunder other than, in each case, commercial or standby letters of credit or the functional equivalent thereof issued in connection with performance, bid or advance payment obligations incurred in the ordinary course of business, including, without limitation, performance requirements  under workers compensation or similar laws;

(viii)    all obligations of such Person under Interest Rate Protection Agreements or Currency Protection Agreements;

(ix)    Guarantee Obligations of such Person; and

(x)     the principal balance outstanding under any synthetic lease, tax retention operation lease, off-balance sheet loan or similar off-balance sheet financing product to which such Person is a party, where such transaction is considered borrowed money indebtedness for tax purposes but is classified as an operating lease in accordance with GAAP.

"Insolvent": with respect to any Person, that the present fair saleable value of the assets of such Person is less than the amount that will be required to pay the probable liability on existing Debts of such Person or such Person is unable to pay its Debts, as such Debts become absolute and matured.

"Intellectual Property": as defined in Section 5.13.

"Intercompany Indebtedness": Indebtedness of Borrower or any of its Subsidiaries which, in the case of Borrower, is owing to any such Subsidiary and which, in the case of any Subsidiary of Borrower, is owing to Borrower or any of its other Subsidiaries.

"Interest Payment Date": (a)  as to any Base Rate Loan, the last Business Day of each March, June, September and December to occur while such Loan is outstanding and the date on which all of the Loans hereunder are paid in full, (b) as to any Eurodollar Loan, the last day of the Interest Period applicable thereto and (c) as to any Eurodollar Loan having an Interest Period longer than three months, each day which is three months after the first day of the Interest Period applicable thereto; provided, however, that, in addition to the foregoing, each of (x) the date upon which the Commitments have been terminated and the Loans have been paid in full and (y) the Termination Date shall be deemed to be an "Interest Payment Date" with respect to any interest which is then accrued hereunder.

"Interest Period": as defined in Section 3.4.

"Interest Rate Determination Date": the date for calculating the Eurodollar Rate for an Interest Period, which date shall be the second Business Day prior to the first day of the related Interest Period for such Eurodollar Loan.

"Interest Rate Protection Agreement": any interest rate swap agreement, interest rate cap agreement or other financial agreement or arrangement designed to protect Borrower or any of its Subsidiaries against fluctuations in interest rates.

"Inventory" means, with respect to the Borrower and its Subsidiaries, inclusively, all goods, merchandise and other personal property wherever located, now owned or hereafter acquired by the Borrower or any of its Subsidiaries of every kind or description which are held for sale or lease or are furnished or to be furnished under a contract of service or are raw materials, work-in-process or materials used or consumed or to be used or consumed in the Borrower's or any of its Subsidiaries' business.

"Investment": as applied to any Person, any direct or indirect purchase or other acquisition for value by that Person of stock or other securities of any other Person (or a beneficial interest therein), or a capital contribution by that Person to any other Person, or any direct or indirect loan or advance to any other Person, or any purchase by that Person of all or a significant part of the assets of a business conducted by another Person or any purchase by that Person of a futures contract or such person otherwise becoming liable for the purchase or sale of currency or other commodity at a future date in the nature of a futures contract.  The amount of any Investment by any Person shall be the original Investment (including the amount of any liability assumed to the extent that such liability would be reflected on a balance sheet prepared in accordance with GAAP) plus the cost of all additions thereto, without any adjustments for increases or decreases in value, or write-ups, write-downs or write-offs with respect to such Investment.

"IRS": the United States Internal Revenue Service, or any successor or analogous U.S. Governmental Authority.

"Landlord Consent" means a letter in favor of Agent and the Lenders which is executed by each lessor of any material leased facility of Borrower or any Subsidiary of Borrower at which Collateral may now or in the future be located, in form and substance reasonably satisfactory to the Agent and consistent with the standards outlined in subclause(G)(ii) of the definition of Eligible Inventory.

 "LC Commission": as defined in Section 2.9(e)(ii).

"LC Obligations": at any time, an amount equal to the sum of (a) the aggregate Stated Amount of the then outstanding Letters of Credit and (b) the aggregate amount of Unpaid Drawings (in each case without duplication).  The LC Obligation of any Lender at any time shall mean its Pro Rata Share of the aggregate LC Obligations outstanding at such time.

"LC Participant": as defined in Section 2.9(e).

"LC Supportable Indebtedness": (i) obligations of Borrower or its Subsidiaries incurred in the ordinary course of business with respect to insurance obligations and workers' compensation, surety bonds and other similar statutory obligations and (ii) such other obligations of Borrower or any of its Subsidiaries as are reasonably acceptable to Agent and the respective Facing Agent and otherwise permitted to exist pursuant to the terms of this Agreement.

"Lender Default": (i) the refusal (which has not been retracted) of a Lender to meet its obligation to make available its portion of any Borrowing or to fund its portion of any unreimbursed payment under Section 2.1(b)or (ii) a Lender having notified in writing Borrower and/or Agent that it does not intend to comply with its obligations under Section 2.1 (whether or not as a result of any takeover of such Lender by any regulatory authority or agency).

"Lenders": means those financial institutions from time to time party to the Agreement.

"Lending Office": with respect to each Lender, the office specified on such Lender's signature page or in the applicable Assignment and Assumption Agreement with respect to each Type of Loan, or such other office as such Lender may designate in writing from time to time to Borrower and Agent with respect thereto.

"Letter of Credit": means any Standby Letter of Credit or Commercial Letter of Credit issued by a Facing Agent hereunder, and any amendments thereto or replacements thereof, pursuant to Section 2.9.

"Letter of Credit Payment": as applicable (a) all payments made by the Facing Agent pursuant to either a draft or demand for payment under a Letter of Credit or (b) all payments made by the Lenders to the Facing Agent in respect thereof.

"Letter of Credit Request": as defined in Section 2.9(c).

"Lien": any judgment lien or execution, attachment, levy, distraint or similar legal process and any mortgage, pledge, security interest, encumbrance, lien, charge or deposit arrangement (other than a deposit in the ordinary course of business and not intended as security) of any kind (including, without limitation, any conditional sale or other title retention agreement or lease in the nature thereof, any sale of receivables with recourse (in whole or in part) against the seller or any other Person except the account debtors, any filing or agreement to file a financing statement as debtor under the UCC or any similar statute other than to reflect ownership by a third party of property leased to Borrower or any of its Subsidiaries under a lease which is not in the nature of a conditional sale or title retention agreement, or any subordination arrangement in favor of another Person).

"Liquidity": as of any date of determination, all cash and Cash Equivalents of the Borrower (determined on a consolidated basis) plus the Total Available Revolving Commitments.

"Loan": a Revolving Loan, Term Loan or a Swing Line Loan, as the context shall require; collectively, the "Loans."

"Loan Documents": this Agreement, the Notes, each Letter of Credit, each Security Document and any other instruments, documents and agreements delivered to Agent in favor of the Lenders or for the benefit of the Lenders.

"Majority Lenders" of any Facility means those Non-Defaulting Lenders which would constitute the Required Lenders under, and as defined in, this Agreement if all outstanding Obligations of other Facilities under this Agreement were repaid in full and all Commitments with respect thereto were terminated.

 "Material Adverse Effect": a material adverse effect on (a) the business, condition (financial or otherwise), assets, liabilities, property or operations of Borrower and its Subsidiaries taken as a whole, (b) the ability of Borrower or any Subsidiary to perform its obligations under any Loan Document to which it is a party, or (c) the validity or enforceability of this Agreement, any Note, any Security Document or the material rights or remedies of Agent and the Lenders hereunder or thereunder.

"Material Asset Disposition": any Asset Disposition of all or any substantial part of the assets of Borrower and its Subsidiaries, taken as a whole, to any Person (other than Borrower or any of its Subsidiaries).  For purposes of this definition, any subsidiary or the assets of a business operation which, in each case, if separately counted would constitute a "significant subsidiary" within the meaning of Rule 1-02 of Regulation S-X promulgated by the United States Securities and Exchange Commission shall be deemed to constitute a "substantial part of the assets" of such Borrower and its Subsidiaries, taken as a whole.

"Material Subsidiary": a Subsidiary, including its subsidiaries, which meets any of the following conditions:

(i)     the Borrower's and its Subsidiaries' advances to and other investments in the Subsidiary exceed 10 percent of the total assets of the Borrower and its Subsidiaries consolidated as of the end of the most recently completed fiscal year; or

(ii)     the Borrower's and its other Subsidiaries' proportionate share of the total assets (after intercompany eliminations) of the Subsidiary exceeds 10 percent of the total assets of the Borrower and its Subsidiaries consolidated as of the end of the most recently completed fiscal year; or

(iii)     the EBITDA of the Subsidiary exceeds 10 percent of the EBITDA of the Borrower and its Subsidiaries consolidated for the most recently completed fiscal year.

"Minimum Borrowing Amount": with respect to Base Rate Loans, $5,000,000, and with respect to Eurodollar Loans, $5,000,000, and with respect to Swing Line Loans, $1,000,000.

"Modification": as defined in Section 11.1.

"Moody's": Moody's Investors Service, Inc. or any successor to the rating agency business thereof.

 "Mortgaged Property": any real property subject to the Mortgages pursuant to Section 5.19(b) or 7.12.

"Mortgage" means individually and collectively, the Ramsey Mortgage, the Cortland Mortgage and any mortgages or similar documents executed pursuant to Section 7.12, all as amended, restated, supplemented or otherwise modified from time to time.

"Mortgage Policies" means any mortgage insurance policies, "marked up" mortgage title insurance commitment, items described in Exhibits 6.1(a)(vi)(ii) or 6.2(a)(vi)(ii) hereto or similar documents delivered pursuant to Sections 5.19(a), 5.19(b) or 7.12.

 "Most Recent Ratio of Consolidated Debt to Consolidated EBITDA": at any date, the ratio of Consolidated Debt as of the end of the most recently ended fiscal quarter of Borrower for which financial statements have been delivered pursuant to Section 7.1 (after giving effect to all payments made on or before such date) to Consolidated EBITDA for the period of four consecutive fiscal quarters ending on the last day of the most recently ended fiscal quarter of Borrower for which financial statements have been delivered pursuant to Section 7.1; provided, however, that on the date of any Acquisition, the "Most Recent Ratio of Consolidated Debt to Consolidated EBITDA" shall be recalculated effective until the date of delivery of the next quarterly financial statements as the ratio of Consolidated Debt as of the date of any such Acquisition (and after giving effect to any Indebtedness incurred or assumed in connection therewith) to Consolidated EBITDA for the four fiscal quarter period ending as of the most recently ended fiscal quarter for which financial statements have been delivered pursuant to Section 7.1 (calculated on a pro forma basis as set forth in the definition of Consolidated EBITDA after giving effect to the Acquisition); provided, further, however, that if Borrower fails to deliver such financial statements as required by Article VII and further fails to remedy such default within five days of notice thereof from Agent, then, without prejudice to any other rights of any Lender hereunder, the Most Recent Ratio of Consolidated Debt to Consolidated EBITDA" shall be deemed to be greater than 3.50 to 1.0 as of the date such financial statements were required to be delivered under Section 7.1.

"Multiemployer Plan": any plan described in Section 4001(a)(3) of ERISA to which contributions are or, within the immediately preceding six years, have been made or required by Borrower or any of its Subsidiaries or ERISA Affiliates.

"Net Offering Proceeds": the proceeds received from (a) the issuance of any Capital Stock or (b) the incurrence of any Indebtedness net of the actual liabilities for reasonably anticipated cash taxes in connection with such issuance or incurrence, if any, any underwriting, brokerage and other customary selling commissions incurred in connection with such issuance or incurrence, and reasonable legal, advisory and other fees and expenses, including title and recording tax expenses, if any, incurred in connection with such issuance or incurrence.

"Net Sale Proceeds": means the aggregate cash proceeds received from any Asset Disposition (including, without limitation, cash received by way of deferred payment pursuant to a note receivable, conversion of non-cash consideration, cash payments in respect of purchase price adjustments or otherwise, but only as and when such cash is received) by Borrower or any Subsidiary minus the reasonable costs and expenses incurred in connection therewith and any provision for taxes in respect thereof made in accordance with GAAP.

"New Domestic Subsidiary": as defined in Section 7.12(a).

"Non-Convertible Capital Stock": with respect to any corporation, any non-convertible Capital Stock of such corporation and any Capital Stock of such corporation convertible solely into non-convertible common stock of such corporation; provided, however, that Non-Convertible Capital Stock shall not include any Redeemable Stock or Exchangeable Stock.

"Non-Defaulting Lender": each Lender which is not a Defaulting Lender.

"Notes": respectively (i) individually, each Revolving Note, Term A Note, Term B Note or Swing Line Note and (ii) collectively, all Revolving Notes, all Term Notes and all Swing Line Notes.

"Notice of Borrowing": as defined in Section 2.5.

"Notice of Conversion or Continuation": as defined in Section 2.6.

"Obligations": all Loans and other Indebtedness, advances, debts, liabilities, obligations, covenants and duties owing by any Credit Party to any Lender, any Agent or any other Person required to be indemnified under any Loan Document, of any kind or nature, present or future, whether or not evidenced by any note, guaranty or other instrument, arising under this Agreement or under any other Loan Document, whether or not for the payment of money, whether arising by reason of an extension of credit, loan, guaranty, indemnification or in any other manner, whether direct or indirect (including those acquired by assignment), absolute or contingent, due or to become due, now existing or hereafter arising and however acquired.

"OECD": the Organization for Economic Cooperation and Development.

"Operating Account" means any account held at a bank or other financial institution out of which a Person disburses funds for the purpose of conducting the business of such Person.

"Original Credit Agreement": has the meaning assigned to that term in the recitals hereto.

"Original Term Loan Lender" as defined in Section 2.1(a)(ii).

"Original Term Loans" as defined in Section 2.1(a)(i).

"Payment Office": the address for such payments for such Loans set forth on Schedule 11.3 hereto in relation to Agent, or such other address as Agent may from time to time specify in accordance with Section 11.3.

"PBGC": the Pension Benefit Guaranty Corporation created by Section 4002(a) of ERISA or any successor thereto.

 "Permitted Acquisition": any Acquisition where the Person acquired is a Wholly-Owned Subsidiary or the assets acquired are owned by Borrower or a Wholly-Owned Subsidiary and where (i) the Person acquired becomes a Credit Party or the assets acquired are owned by a Credit Party and the Aggregate Consideration paid by the Borrower and its Subsidiaries is less than $5,000,000 when aggregated with the Aggregate Consideration paid in connection with any other Permitted Acquisition consummated on or after the Third Amended and Restated Effective Date  and (1) the Person or assets to be acquired are in a business which is reasonably related to the business the Borrower or any Subsidiary of the Borrower is engaged in on the date hereof (2) after giving effect thereto on a pro forma basis for the period (the "Pro Forma Period") of four fiscal quarters ending with the fiscal quarter for which financial statements have most recently been delivered (or were required to be delivered) under Section 7.1 (on the basis that (A) Indebtedness incurred or assumed in connection with such Acquisition was incurred or assumed at the beginning of the Pro Forma Period, (B) if such Indebtedness bears interest at a floating rate, interest expense for the Pro Forma Period shall be calculated at the rate in effect on the date of such Acquisition, and (C) all income and expenses associated with the assets or entity acquired in connection with such Acquisition for the most recently ended four fiscal quarter period for which such income and expense amounts are available (with good faith estimates thereof being permitted if financial statements indicating such amounts are not available) shall be treated as being earned or incurred by Borrower over the Pro Forma Period on a pro forma basis), no Event of Default or Unmatured Event of Default would exist hereunder (including, without limitation, under Section 8.1(d)); (3) the ratio of Consolidated Debt to Consolidated EBITDA of Borrower on the pro forma basis described above would be less than 2.75 to 1.0; and (4) after giving effect thereto the Borrower's Liquidity shall not be less than $35,000,000; and (ii) Borrower and its Subsidiaries have complied with the requirement of Section 7.12 hereof with respect to any required execution of the Subsidiary Guarantee Agreement; and (iii) such Acquisition has been approved by the board of directors of the Person to be acquired.

"Permitted IDB/Community Development Indebtedness": (a) Indebtedness related to municipal bonds or similar obligations of a state or political subdivision thereof, issued in connection with an industrial development or related facilities, and (b) Indebtedness owed to or for the benefit of any community development agency, state or local economic development authority or similar entity providing loans, grants or other economic assistance to encourage employment, construction, local investment or other activity deemed beneficial for the community (including without limitation such indebtedness having terms calling for reduced interest rates, debt forgiveness and similar benefits) not exceeding in the aggregate $1,500,000 outstanding at any time (when aggregated with amounts of Permitted IDB/Community Development Indebtedness outstanding on the Third Amended and Restated Effective Date and scheduled on Schedule 5.6 to the Credit Agreement).

"Permitted Investments":

(i)     any demand deposits with any bank or trust company maintained in the ordinary course of business or shares of any money market mutual fund rated at least AAA or the equivalent thereof by S&P or at least Aaa or the equivalent thereof by Moody's, including, without limitation, any such mutual fund managed or advised by any Lender or Agent;

(ii)     any evidence of Indebtedness, maturing not more than two (2) years after the date of acquisition thereof, issued by the U.S., or an instrumentality or agency thereof and guaranteed fully as to principal, interest and premium, if any, by the U.S.;

(iii)    any certificate of deposit that is denominated in Dollars, maturing not more than six (6) months after the date of purchase, issued by a Lender or a commercial banking institution which is a member of the Federal Reserve System and which has a combined capital and surplus and undivided profits of not less than $200,000,000;

(iv)    commercial paper, maturing not more than ninety (90) days after the date of acquisition, issued by a corporation organized and existing under the laws of any State of the U.S. or the District of Columbia or Canada, which is denominated in Dollars, with a rating, at any date of determination, of "Prime‑2" (or better) according to Moody's, or "A‑2" (or better) according to S & P;

(v)     any Investments in any Credit Party (other than an Investment in connection with an Acquisition which shall be governed by clause (vii));

(vi)    any Investments made after the Third Amended and Restated Effective Date by Borrower or any Credit Party in any Subsidiary which is not a Credit Party or any Permitted Unconsolidated Venture in an aggregate amount outstanding at any time not in excess of $5,000,000 or, in the case of any Subsidiary which is not a Credit Party, any Investment in any Subsidiary which is not a Credit Party;

(vii)    Investments made solely as a result of mergers, acquisitions or consolidations permitted under Section 8.4;

(viii)    loans or advances to employees made in the ordinary course of business;

(ix)    Investments in overnight Nassau time deposits and Eurodollar deposits in branches or offices of banking institutions described in clause (ii) of this definition of the term "Permitted Investments";

(x)     Investments outstanding as of the Closing Date in Subsidiaries (as such Investments may be adjusted due to appreciation, repayment of principal, payment of interest, return of capital and similar circumstances);

(xi)    Investments not otherwise permitted hereunder not to exceed $3,000,000 in the aggregate outstanding at any time;

(xii)    Investments by Buckbee-Mears European Holding Company B.V. ("BV2") in that certain Note A dated as of December 22, 1999 by Buckbee-Mears Deutschland Holding GmbH in favor of the Borrower and assigned to BV2 in the original principal amount of 77,000,000 Euro; and

(xiii)    Investments by the Borrower in that certain Note B dated as of December 22, 1999 by Buckbee-Mears Holding Company B.V. in favor of the Borrower in the original principal amount of 77,000,000 Euro ("Note B&1uot;);

provided that if a Permitted Unconsolidated Venture or a Subsidiary which is not a Credit Party shall thereafter become a Credit Party, the foregoing limitations shall thereafter be determined as though any Investment made in such Permitted Unconsolidated Venture or Subsidiary was originally made as an Investment in a Credit Party permitted under clause (v) above; provided, further, that Permitted Investments shall not include Cash or Cash Equivalents exceeding $7,000,000 held by Borrower or its Subsidiaries for more than five (5) consecutive Business Days.

"Permitted Liens": The following Liens:

(i)     Liens for property taxes and assessments or governmental charges or levies and Liens securing claims or demands of mechanics and materialmen; provided, however, payment thereof is not later than the time required by Section 7.5;

(ii)     Liens in an aggregate amount not to exceed $10,000,000 at any time of or resulting from any judgment or award, the time for the appeal or petition for rehearing of which shall not have expired, or in respect of which Borrower or a Subsidiary of Borrower shall at any time in good faith be prosecuting an appeal or proceeding for a review and in respect of which a stay of execution pending such appeal or proceeding for review shall have been secured;

(iii)    Liens incidental to the conduct of business or the ownership of properties and assets (including Liens in connection with worker's compensation, unemployment insurance and other like laws, warehousemen's and attorneys' liens and statutory landlords' liens) and Liens to secure the performance of bids, tenders or trade contracts, or to secure statutory obligations, surety or appeal bonds or other Liens of like general nature incurred in the ordinary course of business and not in connection with the borrowing of money; provided, however, in each case, the obligation secured is not overdue or, if overdue, is being contested in good faith by appropriate actions or proceedings;

(iv)    minor survey exceptions or minor encumbrances, easements or reservations, or rights of others for rights‑of‑way, utilities and other similar purposes, or zoning or other restrictions as to the use of real properties, which customarily exist on properties of corporations engaged in similar activities and similarly situated and which do not in any event materially impair their use in the operation of the business of Borrower and its Subsidiaries;

(v)     Liens securing Indebtedness of a Subsidiary of Borrower to Borrower;

(vi)    Liens existing as of the Third Amended and Restated Effective Date and reflected on Schedule 8.3 hereto and Liens incurred in connection with the refinancing of Indebtedness secured thereby so long as no such Lien extends to any property not subject thereto as of the Third Amended and Restated Effective Date (other than improvements thereto or, if required by the terms of the document or instrument creating or governing such Lien as in effect on the Third Amended and Restated Effective Date, additions thereto and replacements and substitutions therefor);

(vii)    customary rights of setoff, revocation, refund or chargeback under deposit agreements or under the UCC of banks or other financial institutions where Borrower or its Subsidiaries maintain deposits in the ordinary course of business;

(viii)    Liens securing Permitted IDB/Community Development Indebtedness;

(ix)    additional Liens incurred by Borrower and its Subsidiariesso long as the aggregate amount of the obligations secured by such Liens does not exceed on and after the Third Amended and Restated Effective Date, $2,000,000 plus any amounts outstanding on the Third Amended and Restated Effective Date and listed on Schedule 8.3 hereto; and

(x)   Permitted Real Property Encumbrances.

"Permitted Real Property Encumbrances": (i) those liens, encumbrances and other matters affecting title to any Mortgaged Property listed in the Mortgage Policies on the date of delivery of such Mortgage Policies to Agent in accordance with the terms hereof,  (ii) as to any particular parcel of real property at any time, such easements, encroachments, covenants, rights of way, minor defects, irregularities or encumbrances on title which do not materially impair such parcel of real property for the purpose for which it is held by the user thereof, or the Lien held by Agent, (iii) municipal and zoning ordinances and environmental regulations, which are not violated in any material respect by the existing improvements and the present use made by the mortgagor thereof of the premises (as defined in the respective Mortgage), (iv) general real estate taxes and assessments not yet delinquent, and (v) such other items as to which Agent may consent which do not materially impair such parcel of real property for the purpose for which it is held by the user thereof, or the Lien held by the Agent.

"Permitted Subordinated Indebtedness": up to $100,000,000 in aggregate initial principal amount of indebtedness of the Borrower which (i) by its terms is expressly subordinated to this Agreement, as from time to time amended, restated, supplemented, modified, refinanced, refunded or replaced, (ii) has a maturity date not less than one year after the Termination Date, (iii) is in all respects in form and substance satisfactory to Agent and (iv) is rated no lower than BB by S&P and no lower than Ba2 by Moody's.

"Permitted Unconsolidated Venture": an Investment in a Person not constituting a Subsidiary of Borrower which Person is engaged in the same or related business as Borrower or any of its Subsidiaries is engaged on the Closing Date.

"Person": an individual or a corporation, limited liability company, partnership, trust, incorporated or unincorporated association, joint venture, joint stock company, government (or an agency or political subdivision thereof) or other entity of any kind provided; however, that references to Persons include their respective permitted successors and assigns or, in the case of governmental Persons, Persons succeeding to the relevant functions of such persons; and all references to statutes and related regulations shall include any amendments of same and any successor statutes and regulations.

"Plan": any plan described in Section 4021(a) of ERISA and not excluded pursuant to Section 4021(b) thereof, which may hereafter be or has been established or maintained, within the immediately preceding six years, or to which contributions are or, within the immediately preceding six years, have been made, by Borrower or any of its Subsidiaries or ERISA Affiliates, but not including any Multiemployer Plan.

"Plan Administrator": has the meaning assigned to the term "administrator" in Section 3(16)(A) of ERISA.

"Plan Sponsor": has the meaning assigned to the term "plan sponsor" in Section 3(16)(B) of ERISA.

"Pledge Agreement": has the meaning assigned to that term in Section 6.1(a)(iv).

 "Pledged Stock": as defined in the Security Documents.

"Prime Lending Rate": the rate which DBTCA announces from time to time as its prime lending rate, base rate or equivalent, as in effect from time to time.  The Prime Lending Rate is a reference rate and does not necessarily represent the lowest or best rate actually charged to any customer.  Any Lender may make commercial loans or other loans at rates of interest at, above or below the Prime Lending Rate.  The Prime Lending Rate shall change automatically and without notice from time to time as and when DBTCA changes its prime lending rates, base rates or equivalent.

"Pro Rata Share": when used with reference to any Lender and any described aggregate or total amount, an amount equal to the result obtained by multiplying such described aggregate or total amount by a fraction the numerator of which shall be such Lender's Revolving Commitment and the denominator of which shall be the Total Revolving Commitment or, if no Revolving Commitments are then outstanding, such Lender's aggregate outstanding principal amount of Revolving Loans and LC Obligations to the total outstanding principal balance of all Revolving Loans and LC Obligations hereunder.

"Quarterly Payment Date": the last Business Day of each March, June, September and December of each year.

"Ramsey Mortgage": the form of Ramsey Mortgage attached hereto as Exhibit 6.1(a)(vi)(i) covering the Ramsey, Minnesota property of the Borrower's Subsidiary as amended, restated, supplemented or otherwise modified from time to time.

"Ramsey Mortgage Policy": any mortgage insurance policies, "marked up" mortgage title insurance commitment, items described in Exhibit 6.1(a)(vi)(ii) hereto or similar documents delivered pursuant to Section 5.19(b).

"Recovery Event": the receipt by Borrower (or any of its Affiliates) of any insurance or condemnation proceeds payable (i) by reason of any theft, physical destruction or damage or any other similar event with respect to any properties or assets of Borrower or any of its Subsidiaries, (ii) by reason of any condemnation, taking, seizing or similar event with respect to any properties or assets of Borrower or any of its Subsidiaries and (iii) under any policy of insurance required to be maintained under Section 5.17.

"Redeemable Stock": any Capital Stock that by its terms or otherwise is required to be redeemed on or prior to the first anniversary of the Termination Date (as the same may be extended pursuant to the terms hereof) or is redeemable at the option of the holder thereof at any time on or prior to the first anniversary of such Termination Date.

"Refunded Swing Line Loans": as defined in Section 2.2(d).

"Register": as defined in Section 11.9(c).

"Regulation D", "Regulation T", "Regulation U" and "Regulation X": respectively, Regulation D, T, U and X of the Board as from time to time in effect and any successor to all or a portion of any thereof.

"Release": any release, spill, emission, leaking, pumping, pouring, emptying, dumping, injection, deposit, disposal, discharge, dispersal, escape, leaching or migration in violation of any Environmental Law into the indoor or outdoor environment or into or out of any property of Borrower or its Subsidiaries, or at any other location, including any location to which Borrower or any Subsidiary has transported or arranged for the transportation of any Contaminant, including the movement of Contaminants through or in the air, soil, surface water, groundwater or property of Borrower or its Subsidiaries or at any other location, including any location to which Borrower or any Subsidiary has transported or arranged for the transportation of any Contaminant.

"Remedial Action": actions required to (i) clean up, remove, treat or in any other way address Contaminants in the indoor or outdoor environment, (ii) prevent or minimize the Release or threat of Release of Contaminants so they do not migrate or endanger or threaten to endanger public health or welfare or the indoor or outdoor environment; or (iii) perform pre-remedial or post-remedial studies and investigations and post-remedial monitoring and care or any other studies, reports or investigations relating to Contaminants.

 "Reportable Event": a "reportable event" described in Section 4043(c) of ERISA or in the regulations thereunder or receipt of a notice of withdrawal liability with respect to a Multiemployer Plan pursuant to Section 4202 of ERISA.

"Required Lenders": at any time, Lenders then holding at least 51% of the sum of (a) the then aggregate unpaid principal amount of the Term Loans,  plus (b) the amount of the Total Revolving Commitment (or if the Total Revolving Commitment has been terminated, then the aggregate principal amount outstanding of Revolving Loans, plus the outstanding amount of LC Obligations); provided, that, if no principal amount of any Loan is then outstanding, then "Required Lenders" shall mean Lenders then having at least 51% of the Total Revolving Commitment.

"Requirement of Law": as to any Person, any law (including common law), treaty, rule or regulation or determination of an arbitrator or a court or other Governmental Authority, including without limitation, any Environmental Law, 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 any of the President, any Executive Vice President, the Chief Financial Officer, Controller or the Treasurer of Borrower.

"Restatement Date": the date on which the conditions specified in Section 6.1 of the Second Amendment and Restatement Agreement were satisfied (or waived in accordance with Section 11.1).

"Restructuring Charges": for any period of four consecutive fiscal quarters that includes the first fiscal quarter of Fiscal Year 2002, any actual restructuring charges recorded by the Borrower and its Subsidiaries during such period but no later than the first quarter of Fiscal Year 2002 in an aggregate amount for all such Restructuring Charges not to exceed $15,000,000, of which up to $4,000,000 may be in cash, in connection with the restructuring of the Borrower and its Subsidiaries.

"Revolver Commitment Reduction" means a permanent reduction of the undrawn Revolving Commitments of the Lenders on the Restatement Date by $35,000,000.

"Revolving Commitment": as to any Lender, the obligation of such Lender to (a) make Revolving Loans to Borrower, (b) participate in Swing Line Loans made to Borrower and (c) to participate in Letters of Credit, in an aggregate principal and/or Stated Amount at any one time outstanding not to exceed the amount set forth opposite such Lender's name on Schedule 2.1(b) under the heading "Revolving Commitment", and as such amount may be reduced from time to time in accordance with the terms hereof; collectively, as to all Lenders, the "Revolving Commitments".

"Revolving Lenders": any Lender that has a Revolving Commitment or is owed a Revolving Loan.

"Revolving Loan Facility": means the credit facility consisting of the Revolving Commitments.

"Revolving Loans": as defined in Section 2.1(b).

"Revolving Note": as defined in Section 2.1(b).

"Sale and Leaseback Transaction": any arrangement, directly or indirectly, with any Person whereby a seller or transferor shall sell or otherwise transfer any real or personal property and then or thereafter lease, or repurchase under an extended purchase contract, conditional sales or other title retention agreement, the same or similar property.

"Scheduled Term Repayments" means a Scheduled Term A Repayment or a Scheduled Term B Repayment.

"Scheduled Term A Repayments" means, with respect to the principal payments on the Term A Loans for each date set forth below, the Dollar amount set forth opposite thereto:

Date	Scheduled Term A Loan Principal Payment
September 30, 2002	$1,665,900
December 31, 2002	$1,665,900
March 31, 2003	$2,332,260
June 30, 2003	$2,332,260
September 30, 2003	$2,332,260
December 31, 2003	$2,332,260
March 31, 2004	$2,332,260

Term A Loan Maturity Date          $58,306,900 or, if less, the aggregate principal amount of Term A Loans outstanding

"Scheduled Term B Repayments" means, with respect to the principal payments on the Term B Loans for each date set forth below, the Dollar amount set forth opposite thereto:

	Scheduled Term B Loan
Date	Principal Payment
September 30, 2002	$834,100
December 31, 2002	$834,100
March 31, 2003	$1,167,740
June 30, 2003	$1,167,740
September 30, 2003	$1,167,740
December 31, 2003	$1,167,740
March 31, 2004	$1,167,740
Term B Loan Maturity Date	$29,193,100 or, if less, the aggregate principal amount of Term B Loans outstanding

"Second Amendment and Restatement Agreement": as defined in the Recitals.

"Second Quarter 2001 Deferred Tax Charge": means, with respect to any period of four consecutive fiscal quarters which includes June 30, 2001, the charge against earnings taken for the second quarter of Fiscal Year 2001 for valuation of deferred income taxes in an amount not exceeding $10,000,000.

"Secured Creditors": as defined in the Security Documents.

"Security Agreements": as defined in Section 6.1(a)(iii).

"Security Documents": collectively, the Security Agreements, the Mortgage, each of the Pledge Agreements each Subsidiary Guarantee Agreement, each Additional Security Document and all other agreements, assignments, security agreements, instruments and documents executed in connection therewith, in each case as the same may be amended, supplemented, restated or otherwise modified and in effect.  For purposes of this Agreement, "Security Documents" shall also include all guaranties, security agreements, mortgages, pledge agreements, collateral assignments, subordination agreements and other collateral documents in the nature of any thereof entered into by Borrower or any Subsidiary of Borrower after the date of this Agreement in favor of Agent for the benefit of the Lenders in satisfaction of the requirements of any Loan Document.

"S&P": Standard & Poor's Ratings Services, a division of the McGraw Hill Companies, Inc. or any successor to the rating agency business thereof.

"Standby Letters of Credit" means any of the irrevocable standby letters of credit issued for the account of Borrower pursuant to this Agreement, in form acceptable to the Facing Agent, together with any increases or decreases in the Stated Amount thereof and any renewals, amendments and/or extensions thereof.

 "Stated Amount" or "Stated Amounts": with respect to any Letter of Credit issued in Dollars, the stated or face amount of such Letter of Credit to the extent available at the time for drawing (subject to presentment of all requisite documents), as the same may be increased or decreased from time to time in accordance with the terms of such Letter of Credit.  

 "Subsidiary": as to any Person, any corporation, partnership (limited or general), limited liability company, trust or other entity of which a majority of the stock (or equivalent ownership or controlling interest) having voting power to elect a majority of the board of directors (if a corporation) or to select the trustee or equivalent controlling interest, shall, at the time such reference becomes operative, be directly or indirectly owned or controlled by such Person or one or more of the other subsidiaries of such Person or any combination thereof.  Unless otherwise qualified, all references to a "Subsidiary" or to "Subsidiaries" in this Agreement shall refer to a Subsidiary or Subsidiaries of Borrower.

"Subsidiary Guarantee Agreement": the Subsidiary Guarantee Agreement in substantially the form of Exhibit 6.1(a)(v) hereto, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms and the terms hereof.

"Subsidiary Guarantor": such Subsidiaries which are parties to the Subsidiary Guarantee Agreement or which pursuant to Section 7.12 from time to time become a party to the Subsidiary Guarantee Agreement and collectively, all of such Subsidiaries.

"Subsidiary Guarantor Security Agreement" as defined in Section 6.1(a)(iii).

"Supermajority Lenders" of any Facility means those Non-Defaulting Lenders of such Facility the sum of whose outstanding Loans of such Facility would constitute greater than 66 2/3% of the sum of the total outstanding Loans of Non-Defaulting Lenders of such Facility.

"Swing Line Commitment": of the Swing Line Lender at any date, the obligation of the Swing Line Lender to make Swing Line Loans pursuant to Section 2.2 in the amount referred to therein.

"Swing Line Lender": DBTCA.

"Swing Line Loans": as defined in Section 2.2(a).

"Swing Line Loan Participation Certificate": a certificate, substantially in the form of Exhibit 2.2(e).

"Swing Line Note": as defined in Section 2.2(b).

 "Taxes": any present or future taxes, levies, imposts, duties or other charges of whatever nature imposed by any government or any political subdivision or taxing authority thereof, other than any tax on, or measured by, the net income of any applicable Lender.

"Term A Conversion Pro Rata Share": means, when used with reference to any Original Term Loan Lender, an amount equal to the result obtained by multiplying $73,300,000 by a fraction the numerator of which shall be such Lender's then outstanding Original Term Loans and the denominator of which shall be all then outstanding Original Term Loans.

"Term A Facility" means the credit facility under this Agreement evidenced by the Term A Loans.

"Term A Lender" means any Lender which is owed a Term A Loan.

"Term A Loan" and "Term A Loans" as defined in Section 2.1(a)(ii).

"Term A Loan Maturity Date": May 14, 2004 or such earlier date as the outstanding Term A Loans shall have been reduced to $0 pursuant to this Agreement.

"Term A Note" is defined in Section 2.2(a).

"Term A Percentage" means, as of any date of determination, expressed as a percentage, (i) the aggregate principal amount of outstanding Term A Loans divided by (ii) the aggregate principal amount of all outstanding Term Loans.

"Term A Pro Rata Share" means, when used with reference to any Term A Lender and any described aggregate or total amount, an amount equal to the result obtained by multiplying such described aggregate or total amount by a fraction the numerator of which shall be such Lender's then outstanding Term A Loan and the denominator of which shall be all then outstanding Term A Loans.

"Term B Conversion Pro Rata Share": means, when used with reference to any Original Term Loan Lender, an amount equal to the result obtained by multiplying $36,700,000 by a fraction the numerator of which shall be such Lender's then outstanding Original Term Loans and the denominator of which shall be all then outstanding Original Term Loans.

"Term B Facility" means the credit facility under this Agreement evidenced by the Term B Loans.

"Term B Lender" means any Lender which is owed a Term B Loan.

"Term B Loan" and "Term B Loans": as defined in Section 2.1(a)(ii).

"Term B Loan Maturity Date": May 14, 2004 or such earlier date as the outstanding Term B Loans shall have been reduced to $0 pursuant to this Agreement.

"Term B Note": as defined in Section 2.2(a).

"Term B Percentage": means, as of any date of determination, expressed as a percentage, (i) the aggregate principal amount of outstanding Term B Loans divided by (ii) the aggregate principal amount of all outstanding Term Loans.

"Term B Pro Rata Share": means, when used with reference to any Term B Lender and any described aggregate or total amount, an amount equal to the result obtained by multiplying such described aggregate or total amount by a fraction the numerator of which shall be such Lender's then outstanding Term B Loan and the denominator of which shall be all then outstanding Term B Loans.

"Term Lender": any Lender that is owed a Term Loan.

"Term Loan" and "Term Loans": as defined in Section 2.1(a)(ii).

"Term Loan Conversion": as defined in Section 2.1(a)(i).

"Term Loan Conversion Notice": a Term Loan Conversion Notice substantially in the form of Exhibit 11.10 annexed hereto, delivered on or prior to the Restatement Date and made a part hereof made by any applicable Lender.

"Term Note": as defined in Section 2.2(a).

"Termination Date": the earlier to occur of

(a)     May 14, 2004; and
      (b)     the date on which the Commitments shall otherwise terminate in accordance with the provisions of this Agreement.

"Termination Event": (i) a Reportable Event (other than a Reportable Event not subject to the provisions for 30-day notice to the PBGC), or (ii) the withdrawal of Borrower or any of its ERISA Affiliates from a Plan during a plan year in which it was a "substantial employer" as defined in Section 4001(a)(2) of ERISA, or (iii) the filing of a notice of intent to terminate a Plan in a distress termination under Section 4041 of ERISA, or (iv) the institution of proceedings to terminate a Plan by the PBGC, or (v) any other event or condition which could reasonably be expected to constitute grounds under Section 4042 of ERISA for the involuntary termination of, or the appointment of a trustee to administer, any Plan, or (vi) the imposition of liability of Borrower or any of its ERISA Affiliates pursuant to Sections 4064 or 4069 of ERISA, which, in the case of any event described in clauses (i) through (vi) above, would cause the sum of Borrower's and its ERISA Affiliates' liabilities (after giving effect to the tax consequences thereof) resulting from or otherwise associated with such event to exceed $10,000,000.

"Third Amended and Restated Effective Date": the date on which the conditions specified in Section 6.2 of the Third Amended and Restated Credit Agreement are satisfied (or waived in accordance with Section 11.1).

 "Third Quarter 2001 Nonrecurring Charges" means, with respect to any period of four consecutive fiscal quarters which includes September 30, 2001, actual non-recurring charges of the Borrower and its Subsidiaries in an amount up to $3,500,000.

"Total Available Revolving Commitment": at the time any determination thereof is made, the sum of the respective Available Revolving Commitments of the Revolving Lenders at such time.

"Total Revolving Commitment": at any time any determination is to be made, the sum of the respective Revolving Commitments of the Revolving Lenders at such time.

"Transaction": shall mean and include (i) each of the Credit Events occurring on the Restatement Date, (ii) such other transactions as are contemplated by the Documents, and (iii) the payment of fees and expenses in connection with the foregoing.

"Type": as to any Loan, its nature as a Base Rate Loan or a Eurodollar Loan.

"Unmatured Event of Default": an event, act, condition or occurrence which with the giving of notice or the lapse of time (or both) would become an Event of Default.

"Unpaid Drawing": as defined in Section 2.9(c).

"U.S.": the United States of America, its territories, its possessions and all other areas subject to its jurisdiction.

"Voting Securities": any class of Capital Stock of a Person pursuant to which the holders thereof have, at the time of determination, the general voting power under ordinary circumstances to vote for the election of directors, managers, trustees or general partners of such Person (irrespective of whether or not at the time any other class or classes will have or might have voting power by reason of the happening of any contingency).

"Wholly‑Owned Subsidiary": with respect to any Person, any Subsidiary of such Person, all of the outstanding shares of capital stock of which (other than qualifying shares required to be owned by directors) are at the time owned directly or indirectly by such Person and/or one or more Wholly‑Owned Subsidiaries of such Person.

"Withdrawal Liability": liability to a Multiemployer Plan as a result of a complete or partial withdrawal of Borrower or any of its Subsidiaries from such Multiemployer Plan, as such terms are defined in Part I of Subtitle E of Title IV of ERISA.

"written" or "in writing": any form of written communication or a communication by means of a telecopier device or authenticated telex, telegraph or cable.

1.2    Accounting Terms, Financial Statements.  All accounting terms used herein shall have the respective meanings given to them in accordance with GAAP, unless otherwise provided herein.  All computations and determinations for purposes of determining compliance with the financial requirements of this Agreement shall be made in accordance with GAAP, unless otherwise provided herein.

1.3    Other Definitional Terms.  The words "hereof", "herein" and "hereunder" and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement, and Article, Section, Recital, Schedule, Exhibit and like references are to this Agreement unless otherwise specified.

ARTICLE II
AMOUNT AND TERMS OF CREDIT

2.1    The Commitments.

(a)     Term Loans.          

(i)     On the Restatement Date, each Converting Lender, severally and for itself alone, converted a portion of its then outstanding Revolving Loans in a principal amount equal to the amount set forth opposite each such Lender's name on Schedule 2.1(a)(i) hereto or in any Term Loan Conversion Notice delivered by such Lender to term loans (in each case such Converting Lender's "Converted Term Loan Amount" and each such loan as converted, an "Original Term Loan" and collectively, the "Original Term Loans").  Each Lender's Revolving Commitment in effect immediately prior to the Restatement Date was reduced by its Converted Term Loan Amount, if any (collectively, the "Term Loan Conversion").  The amount of Revolving Loans that was converted to Term Loans on the Restatement Date was a principal amount of $125,000,000.

(ii)     On the Third Amended and Restated Effective Date, each Lender with an Original Term Loan (each an "Original Term Loan Lender"), severally and for itself alone, hereby agrees, on the terms and subject to the conditions hereinafter set forth and in reliance upon the representations and warranties set forth herein and in the other Loan Documents, to convert all of its Original Term Loans outstanding on the Third Amended and Restated Effective Date (the "Original Term Loan Conversion") into two separate tranches of term loans with (A) the Term A Conversion Pro Rata Share of such Original Term Loan Lender's Original Term Loans being converted into one tranche of term loans (each such loan as converted, a "Term A Loan" and collectively, the "Term A Loans") and (B) the Term B Conversion Pro Rata Share of such Original Term Loan Lender's Original Term Loans being converted into a separate tranche of term loans (each such loan as converted, a "Term B Loan" and collectively, the "Term B Loans" and together with the Term A Loans, collectively, the "Term Loans").  Except as hereinafter provided, Term Loans may, at the option of Borrower, be maintained as and/or converted into Base Rate Loans or Eurodollar Loans.  No amount of a Term Loan which is repaid or prepaid by Borrower may be reborrowed hereunder.  The amount of each Lender's outstanding Term A Loans and Term B Loans on the Third Amended and Restated Effective Date shall be as set forth on Schedule 2.1(a)(ii) under the columns "Term A Loans" and "Term B Loans", respectively.  The Borrower and the Lenders hereby acknowledge that the aggregate amounts of the Term A Loans and Term B Loans outstanding on the Third Amended and Restated Effective Date is equal to $73,300,000 and $36,700,000, respectively. 

(b)     Revolving Loan Commitment.  Each Lender severally and for itself alone, hereby agrees, on the terms and subject to the conditions hereinafter set forth and in reliance upon the representations and warranties set forth herein and in the other Loan Documents, to make loans to Borrower on a revolving basis from time to time during the Commitment Period, in an amount not to exceed its Commitment Percentage of the Total Available Revolving Commitment (each such loan by any Lender, a "Revolving Loan" and collectively, the "Revolving Loans"); provided, however, that, after giving effect to any Borrowing of Revolving Loans, the aggregate amount of all outstanding Revolving Loans, and the aggregate amount of all LC Obligations and Swing Line Loans then outstanding, shall not at any time exceed the lesser of (i) the Borrowing Base and (ii) the Total Revolving Commitment; provided, further, that in no event may Borrower make any Borrowing of Revolving Loans the effect of which would cause Borrower to have on hand Cash or Cash Equivalents in excess of $7,000,000 for a period greater than five (5) consecutive Business Days.  All Revolving Loans comprising the same Borrowing hereunder shall be made by the Revolving Lenders simultaneously and in proportion to their respective Revolving Commitments.  Prior to the Termination Date, Revolving Loans may be repaid and reborrowed by Borrower in accordance with the provisions hereof and, except as otherwise specifically provided in Section 3.6, all Revolving Loans comprising the same Borrowing shall at all times be of the same Type.  Notwithstanding anything else herein to the contrary, the parties hereby acknowledge that (A) on the Restatement Date, the Total Revolving Commitment in effect immediately prior to the Restatement Date (which, for the avoidance of doubt, was $220,000,000) was permanently reduced by (x) the Aggregate Converted Term Loan Amount; and (y) the Revolver Commitment Reduction; and (B) on the Third Amended and Restated Effective Date, the Total Revolving Commitment in effect immediately prior to the Third Amended and Restated Effective Date (which, for avoidance of doubt, is acknowledged to be $60,000,000) shall be permanently reduced by $25,000,000 and the Borrower and the Lenders hereby acknowledge that the Total Revolving Commitment after such reduction shall be equal to $35,000,000.

(c)    Swing Line Loans.

(i)     Swing Line Commitment.  Subject to the terms and conditions hereof, the Swing Line Lender in its individual capacity agrees to make swing line loans in Dollars ("Swing Line Loans") to Borrower on any Business Day from time to time during the Commitment Period in an aggregate principal amount at any one time outstanding not to exceed $10,000,000; provided, however, that in no event may the amount of any Borrowing of Swing Line Loans (A) exceed the Total Available Revolving Commitment immediately prior to such Borrowing (after giving effect to the use of proceeds thereof) or (B) cause the outstanding Revolving Loans of any Lender, when added to such Lender's Commitment Percentage of the then outstanding Swing Line Loans and Commitment Percentage of the aggregate LC Obligations (exclusive of Unpaid Drawings relating to LC Obligations which are repaid with the proceeds of, and simultaneously with the incurrence of, Revolving Loans or Swing Line Loans) to exceed such Lender's Revolving Commitment; provided, further, that, after giving effect to any Borrowing of Swing Line Loans, the aggregate amount of all outstanding Swing Line Loans, and the aggregate amount of all LC Obligations and Revolving Loans then outstanding, shall not at any time exceed the lesser of (i) the Borrowing Base and (ii) the Total Revolving Commitment.  Amounts borrowed by Borrower under this Section 2.1(c)(i) may be repaid and, at any time prior to the Termination Date, reborrowed.  The Swing Line Loans shall be made in Dollars and maintained as Base Rate Loans and, notwithstanding Section 2.6, shall not be converted into any other Type of Loan.

(ii)     Refunding of Swing Line Loans.  The Swing Line Lender, at any time in its sole and absolute discretion, may on behalf of Borrower (which hereby irrevocably directs the Swing Line Lender to so act on its behalf) notify each Lender (including the Swing Line Lender) to make a Revolving Loan in an amount equal to such Lender's Commitment Percentage of the principal amount of the Swing Line Loans (the "Refunded Swing Line Loans") outstanding on the date such notice is given, provided, however, that such notice shall be deemed to have automatically been given upon the occurrence of an Event of Default under Sections 9.1(g) or 9.1(h) or upon the occurrence of a Change of Control.  Unless any of the events described in Sections 9.1(g) or 9.1(h) shall have occurred (in which event the procedures of Section 2.1(c)(iii) shall apply) and regardless of whether the conditions precedent set forth in this Agreement to the making of a Revolving Loan are then satisfied, each Lender shall make the proceeds of its Revolving Loan available to the Swing Line Lender at the Payment Office prior to 11:00 A.M., New York City time, in funds immediately available on the Business Day next succeeding the date such notice is given.  The proceeds of such Revolving Loans shall be immediately applied to repay the Refunded Swing Line Loans.

(iii)    Participation in Swing Line Loans.  If, prior to refunding a Swing Line Loan with a Revolving Loan pursuant to Section 2.1(c)(ii), one of the events described in Sections 9.1(g) or 9.1(h) shall have occurred, or if for any other reason a Revolving Loan cannot be made pursuant to Section 2.1(c)(ii), then, subject to the provisions of Section 2.1(c)(iv) below, each Lender will, on the date such Revolving Loan was to have been made, purchase (without recourse or warranty) from the Swing Line Lender an undivided participation interest in the Swing Line Loans in an amount equal to its Commitment Percentage of such Swing Line Loans.  Upon request, each Lender will immediately transfer to the Swing Line Lender, in immediately available funds, the amount of its participation and upon receipt thereof the Swing Line Lender will deliver to such Lender a Swing Line Loan Participation Certificate dated the date of receipt of such funds and in such amount.

(iv)    Lenders' Obligations Unconditional.  Each Lender's obligation to make Revolving Loans in accordance with Section 2.1(c)(ii) and to purchase participating interests in accordance with Section 2.1(c)(iii) above shall be absolute and unconditional and shall not be affected by any circumstance, including, without limitation, (A) any setoff, counterclaim, recoupment, defense or other right which such Lender may have against the Swing Line Lender, Borrower or any other Person for any reason whatsoever; (B) the occurrence or continuance of any Event of Default or Unmatured Event of Default; (C) any adverse change in the condition (financial or otherwise) of Borrower or any other Person; (D) any breach of this Agreement by Borrower or any other Person; (E) any inability of Borrower to satisfy the conditions precedent to borrowing set forth in this Agreement on the date upon which such participating interest is to be purchased or (F) any other circumstance, happening or event whatsoever, whether or not similar to any of the foregoing.  If any Lender does not make available to the Swing Line Lender the amount required pursuant to Section 2.1(c)(ii) or (iii) above, as the case may be, the Swing Line Lender shall be entitled to recover such amount on demand from such Lender, together with interest thereon for each day from the date of non-payment until such amount is paid in full at the Federal Funds Rate for the first two Business Days and at the Base Rate thereafter.  Notwithstanding the foregoing provisions of this Section 2.1(c)(iv), no Lender shall be required to make a Revolving Loan to Borrower for the purpose of refunding a Swing Line Loan pursuant to Section 2.1(c)(ii) above or to purchase a participating interest in a Swing Line Loan pursuant to Section 2.1(c)(iii) if an Event of Default or Unmatured Event of Default has occurred and is continuing and, prior to the making by the Swing Line Lender of such Swing Line Loan, the Swing Line Lender had received written notice from such Lender specifying that such Event of Default or Unmatured Event of Default has occurred and is continuing, describing the nature thereof and stating that, as a result thereof, such Lender shall cease to make such Refunded Swing Line Loans and purchase such participating interests, as the case may be; provided, however, that the obligation of such Lender to make such Refunded Swing Line Loans and to purchase such participating interests shall be reinstated upon the earlier to occur of (y) the date upon which such Lender notifies the Swing Line Lender that its prior notice has been withdrawn and (z) the date upon which the Event of Default or Unmatured Event of Default specified in such notice no longer is continuing.

2.2    Notes.

(a)     Evidence of Indebtedness.  Borrower's obligation to pay the principal of and interest on all the Loans made to it by each Lender shall be evidenced, (w) if Term A Loans, by a promissory note (each, a "Term A Note" and collectively, the "Term A Notes") duly executed and delivered by Borrower substantially in the form of Exhibit 2.2(a)-1(a) hereto, with blanks appropriately completed in conformity herewith, (x) if Term B Loans, by a promissory note (each, a "Term B Note" and collectively, the "Term B Notes" and collectively with the Term A Notes, the "Term Notes")) duly executed and delivered by Borrower substantially in the form of Exhibit 2.2(a)-1(b) hereto, with blanks appropriately completed in conformity herewith, (y) if Revolving Loans, by a promissory note (each, a "Revolving Note" and, collectively, the "Revolving Notes") duly executed and delivered by Borrower substantially in the form of Exhibit 2.2(a)-2 hereto, with blanks appropriately completed in conformity herewith and (z) if Swing Line Loans, by a promissory note (the "Swing Line Note") duly executed and delivered by Borrower substantially in the form of Exhibit 2.2(a)-3 hereto, with blanks appropriately completed in conformity herewith.

(i)     Provisions of the Term Notes.  (x) The Term A Note issued to each Term A Lender shall (A) be executed by Borrower, (B) be payable to the order of such Term A Lender and be dated the Third Amended and Restated Effective Date, (C) be payable in the aggregate principal amount of the Term A Loan evidenced thereby, (D) mature, with respect to each Term A Loan evidenced thereby, on the Term A Loan Maturity Date, (E) be subject to mandatory prepayment as provided in Section 4.3, (F) bear interest as provided in Section 3.1 in respect of the Base Rate Loans and Eurodollar Loans, as the case may be, evidenced thereby and (G) be entitled to the benefits of this Agreement and the other applicable Loan Documents; and (y) the Term B Note issued to each Term B Lender shall (A) be executed by Borrower, (B) be payable to the order of such Term B Lender and be dated the Third Amended and Restated Effective Date, (C) be payable in the aggregate principal amount of the Term B Loan evidenced thereby, (D) mature, with respect to each Term B Loan evidenced thereby, on the Term B Loan Maturity Date, (E) be subject to mandatory prepayment as provided in Section 4.3, (F) bear interest as provided in Section 3.1 in respect of the Base Rate Loans and Eurodollar Loans, as the case may be, evidenced thereby and (G) be entitled to the benefits of this Agreement and the other applicable Loan Documents.

(ii)     Provisions of the Revolving Notes.  The Revolving Note issued to each Lender shall (A) be executed by Borrower, (B) be payable to the order of such Lender and be dated the Third Amended and Restated Effective Date, (C) be in a stated principal amount equal to the Revolving Commitment of such Revolving Lender and be payable in the aggregate principal amount of the Revolving Loans evidenced thereby, (D) mature, with respect to each Loan evidenced thereby, on the Termination Date, (E) be subject to mandatory prepayment as provided in Section 4.3, (F) bear interest as provided in the appropriate clause of Section 3.1 in respect of the Base Rate Loans or Eurodollar Loans, as the case may be, evidenced thereby and (G) be entitled to the benefits of this Agreement and the other applicable Loan Documents.

(iii)    Provisions of the Swing Line Note.  The Swing Line Note issued to the Swing Line Lender shall (A) be executed by Borrower, (B) be payable to the order of Swing Line Lender or its registered assigns and be dated the Initial Borrowing Date, (C) be in a stated principal amount equal to the Swing Line Commitment and be payable in the aggregate principal amount of the Swing Line Loans evidenced thereby, (D) mature, with respect to each Loan evidenced thereby, five (5) Business Days prior to the Termination Date, (E) be subject to mandatory prepayment as provided in Section 4.3, (F) bear interest as provided in Section 3.1 in respect of the Base Rate Loans evidenced thereby and (G) be entitled to the benefits of this Agreement and the other applicable Loan Documents.

(b)     Notation of Payments.  Each Lender will note on its internal records the amount of each Loan made by it and each payment in respect thereof and will, prior to any transfer of any of its Notes, endorse on the reverse side thereof the outstanding principal amount of Loans evidenced thereby.  Failure to make any such notation shall not affect Borrower's or any guarantor's obligations hereunder or under the other applicable Loan Documents in respect of such Loans.

2.3    Minimum Amount of Each Borrowing; Maximum Number of Borrowings.  The aggregate principal amount of each Borrowing by Borrower hereunder shall be not less than (i) in the case of a Base Rate Loan, $5,000,000 and, if greater, shall be in integral multiples of $1,000,000 above such minimum (or, if less, the then Total Available Revolving Commitment) and (ii) in the case of a Eurodollar Loan, $5,000,000 and, if greater, shall be in integral multiples of $1,000,000 above such minimum and (iii) in the case of a Swing Line Loan, $1,000,000 and, if greater, shall be in integral multiples of $500,000 above such minimum.  More than one Borrowing may be incurred on any date; provided that at no time shall there be outstanding more than seven (7) Borrowings of Eurodollar Loans.

2.4    Borrowing Options. The Term Loans and the Revolving Loans shall, at the option of Borrower except as otherwise provided in this Agreement, be (i) Base Rate Loans, (ii) Eurodollar Loans, or (iii) part Base Rate Loans and part Eurodollar Loans.  As to any Eurodollar Loan, any Lender may, if it so elects, fulfill its commitment by causing a foreign branch or affiliate to make or continue such Loan, provided that in such event that Lender's Commitment Percentage of the Loan shall, for the purposes of this Agreement, be considered to have been made by that Lender and the obligation of Borrower to repay that Lender's Commitment Percentage of the Loan shall nevertheless be to that Lender and shall be deemed held by that Lender, for the account of such branch or affiliate.

2.5    Notice of Borrowing.  Whenever Borrower desires to make a Borrowing of any Loan hereunder, it shall give Agent at its office located at 90 Hudson Street, Fifth Floor, Jersey City, New Jersey, 07302 (or such other address as the Agent may hereafter designate in writing to the parties hereto) (the "Notice Address") at least one Business Day's prior written notice (or telephonic notice promptly confirmed in writing), given not later than 12:00 P.M. (New York City time) of each Base Rate Loan, and at least three Business Days' prior written notice (or telephonic notice promptly confirmed in writing), given not later than 12:00 P.M. (New York City time), of each Eurodollar Loan to be made hereunder; provided, however, that a Notice of Borrowing with respect to Borrowings to be made on the date hereof may, at the discretion of Agent, be delivered later than the time specified above.  Whenever Borrower desires that Swing Line Lender make a Swing Line Loan under Section 2.1(c), it shall deliver to Swing Line Lender prior to 11:00 A.M. (New York City time) on the date of Borrowing written notice (or telephonic notice promptly confirmed in writing).  Each such notice (each a "Notice of Borrowing"), which shall be in the form of Exhibit 2.5 hereto, shall be irrevocable, shall be deemed a representation by Borrower that all conditions precedent to such Borrowing have been satisfied and shall specify (i) the aggregate principal amount of the Loans to be made pursuant to such Borrowing, (ii) the date of Borrowing (which shall be a Business Day) and (iii) whether the Loans being made pursuant to such Borrowing are to be Base Rate Loans or Eurodollar Loans and, with respect to Eurodollar Loans, the Interest Period to be applicable thereto.  Agent shall as promptly as practicable give each Lender written or telephonic notice (promptly confirmed in writing) of each proposed Borrowing, of such Lender's Commitment Percentage thereof and of the other matters covered by the Notice of Borrowing.  Without in any way limiting Borrower's obligation to confirm in writing any telephonic notice, Agent or the Swing Line Lender (in the case of Swing Line Loans) may act without liability upon the basis of telephonic notice reasonably believed by Agent in good faith to be from a Responsible Officer of Borrower prior to receipt of written confirmation.  Agent's records shall, absent demonstrable error, be final, conclusive and binding on Borrower with respect to evidence of the terms of such telephonic Notice of Borrowing.

2.6    Conversion or Continuation.  Borrower may elect (i) on any Business Day occurring on or after the earlier of (i) the 30th day after the Initial Borrowing Date and (ii) the Syndication Date to convert Base Rate Loans or any portion thereof to Eurodollar Loans and (ii) at the end of any Interest Period with respect thereto, to convert Eurodollar Loans or any portion thereof into Base Rate Loans or to continue such Eurodollar Loans or any portion thereof for an additional Interest Period; provided, however, that the aggregate principal amount of the Eurodollar Loans for each Interest Period therefor must be in an aggregate principal amount of $5,000,000 or an integral multiple of $1,000,000 in excess thereof.  Each conversion or continuation of Revolving Loans shall be allocated among the Revolving Loans of the Revolving Lenders in accordance with their respective Commitment Percentages and each conversion or continuation of Term Loans shall be allocated among the Term Loans of the Term Lenders in accordance with their respective Commitment Percentages.  Each such election shall be in substantially the form of Exhibit 2.6 hereto (a "Notice of Conversion or Continuation") and shall be made by giving Agent at least three Business Days' prior written notice thereof to the Notice Address specifying (i) the amount and type of conversion or continuation, (ii) in the case of a conversion to or a continuation of Eurodollar Loans, the Interest Period therefor, (iii) whether such conversion or continuation is made with respect to Revolving Loans or Term Loans and (iv) in the case of a conversion, the date of conversion (which date shall be a Business Day and, if a conversion from Eurodollar Loans, shall also be the last day of the Interest Period therefor).  Notwithstanding the foregoing, no conversion in whole or in part of Base Rate Loans to Eurodollar Loans, and no continuation in whole or in part of Eurodollar Loans upon the expiration of any Interest Period therefor, shall be permitted at any time at which an Unmatured Event of Default or an Event of Default shall have occurred and be continuing.  If, within the time period required under the terms of this Section 2.6, Agent does not receive a Notice of Conversion or Continuation from Borrower containing a permitted election to continue any Eurodollar Loans for an additional Interest Period or to convert any such Loans, then, upon the expiration of the Interest Period therefor, such Loans will be automatically converted to Base Rate Loans.  Each Notice of Conversion or Continuation shall be irrevocable.

2.7    Disbursement of Funds; Funding Assumptions.

(a)     No later than 12:00 P.M. (New York City time) on the date specified in each Notice of Borrowing, each Lender will make available its Commitment Percentage of Revolving Loans of the Borrowing requested to be made on such date in Dollars and in immediately available funds, at the office (the "Payment Office") of Agent located at 90 Hudson Street, Fifth Floor, Jersey City, New Jersey, 07302 (for the account of such non-U.S. office of Agent as Agent may direct in the case of Eurodollar Loans) and Agent will make available to Borrower at its Payment Office the aggregate of the amounts so made available by the Lenders.

(b)     Unless Agent shall have been notified by any Lender at least one Business Day prior to the date of Borrowing that such Lender does not intend to make available to Agent such Lender's portion of the Loans to be purchased or Borrowing to be made on such date, Agent may assume that such Lender has made such amount available to Agent on such date of Borrowing and Agent may, but shall not be required to, in reliance upon such assumption, make available to Borrower a corresponding amount.  If such corresponding amount is not in fact made available to Agent by such Lender on the date of Borrowing, Agent shall be entitled to recover such corresponding amount on demand from such Lender. If such Lender does not pay such corresponding amount forthwith upon Agent's demand therefor, Agent shall promptly notify Borrower and, if so notified, Borrower shall immediately pay such corresponding amount to Agent.  Agent shall also be entitled to recover from Borrower interest on such corresponding amount in respect of each day from the date such corresponding amount was made available by Agent to Borrower to the date such corresponding amount is recovered by Agent, at a rate per annum equal to the rate for Base Rate Loans or Eurodollar Loans, as the case may be, applicable during the period in question, provided, however, that any interest paid to Agent in respect of such corresponding amount shall be credited against interest payable by Borrower to such lender under Section 3.1 in respect of such corresponding amount.  Any amount due hereunder to Agent from any Lender which is not paid when due shall bear interest payable by such Lender, from the date due until the date paid, at the Federal Funds Rate for the first three days after the date such amount is due and thereafter at the Federal Funds Rate plus 1%, together with Agent's standard interbank processing fee.  Further, such Lender shall be deemed to have assigned any and all payments made of principal and interest on its Loans,  amounts due with respect to its Letters of Credit (or its participations therein) and any other amounts due to it hereunder first to Agent to fund any outstanding Loans made available on behalf of such Lender by Agent pursuant to this Section 2.7 until such Loans have been funded (as a result of such assignment or otherwise) and then to fund Loans of all Lenders other than such Lender until each Lender has outstanding Loans equal to its Commitment Percentage of all Revolving Loans and Term Loans (as a result of such assignment or otherwise).  Such Lender shall not have recourse against Borrower with respect to any amounts paid to Agent or any Lender with respect to the preceding sentence; provided, that such Lender shall have full recourse against Borrower to the extent of the amount of such loans it has in fact made.  Nothing herein shall be deemed to relieve any Lender from its obligation to fulfill its Revolving Commitment hereunder or to prejudice any rights which Borrower may have against the Lender as a result of any default by such Lender hereunder.

2.8    Pro Rata Borrowings.  All Borrowings of Revolving Loans under this Agreement shall be loaned by the Lenders pro rata on the basis of their Revolving Commitments.  No Lender shall be responsible for any default by any other Lender in its obligation to make Loans hereunder and each Lender shall be obligated to make the Loans provided to be made by it hereunder, regardless of the failure of any other Lender to fulfill its Revolving Commitment or make Revolving Loans hereunder.

2.9    Amount and Terms of Letter of Credit.

(a)     Letter of Credit Commitments, Terms of Letters of Credit.

(i)     Subject to and upon the terms and conditions herein set forth and such other conditions as are applicable to its customers generally, at any time and from time to time on or after the Initial Borrowing Date and prior to the 30th Business Day preceding the Termination Date, the Facing Agent agrees to issue, in its own name, but for the ratable benefit of all Revolving Lenders (including Facing Agent) one or more Letters of Credit, each having a Stated Amount in Dollars and on a sight basis, for the account of Borrower in an aggregate undrawn amount at any one time outstanding that together with the aggregate Stated Amount of other Letters of Credit then outstanding, does not exceed $15,000,000; provided, however, that Facing Agent shall not issue or extend the expiration of any Letter of Credit if, immediately after giving effect to such issuance or extension, (A) the aggregate LC Obligations at such time would exceed $15,000,000, or (B) the Available Revolving Commitment of any Revolving Lender would be less than zero.  Each Revolving Lender severally, but not jointly, agrees to participate in each such Letter of Credit issued by Facing Agent to the extent of its Commitment Percentage and to make available to Facing Agent such Revolving Lender's Commitment Percentage of any payment made to the beneficiary of such Letter of Credit to the extent not reimbursed by Borrower; provided, however, that no Revolving Lender shall be required to participate in any Letter of Credit to the extent that such participation therein would exceed such Revolving Lender's Available Revolving Commitment then in effect; provided, further, that, after giving effect to the Issuance of any Letter of Credit, the aggregate amount of all LC Obligations, and the aggregate amount of all Revolving Loans and Swing Line Loans then outstanding, shall not exceed the lesser of (i) the Borrowing Base and (ii) the Total Revolving Commitment.  No Lender's obligation to participate in any Letter of Credit or to make available to Facing Agent such Revolving Lender's Commitment Percentage of any Letter of Credit Payment made by Facing Agent shall be affected by any other Revolving Lender's failure to participate in the same or any other Letter of Credit or by any other Revolving Lender's failure to make available to Facing Agent such other Revolving Lender's Commitment Percentage of any Letter of Credit Payment.  Notwithstanding the foregoing, in the event a Lender Default exists, Facing Agent shall not be required to issue any Letter of Credit unless Facing Agent has entered into arrangements satisfactory to it and Borrower to eliminate such Facing Agent's risk with respect to the participation in Letters of Credit of the Defaulting Lender or Lenders, including by cash collateralizing such Defaulting Lender's or Lenders' Commitment Percentage of the LC Obligations.  Schedule 2.9(a)(i) lists all Letters of Credit outstanding on the Third Amended and Restated Effective Date and which, for purposes of clarification, it is agreed shall remain outstanding under this Agreement.  

(ii)     Each Standby Letter of Credit issued or to be issued hereunder shall have an expiration date of one (1) year or less after the issuance date thereof; provided, however, that each Standby Letter of Credit may provide by its terms that it will be automatically extended for additional successive one (1) year periods unless Facing Agent shall have given notice to the applicable beneficiary of the election by Facing Agent (such election to be in the sole and absolute discretion of Facing Agent) not to extend such Letter of Credit; provided, further, that no Standby Letter of Credit or extension thereof shall be stated to expire later than the 10th Business Day preceding the date set forth in clause (a) of the definition of Termination Date.  Each Commercial Letter of Credit issued or to be issued hereunder shall have an expiration date not later than 180 days after the date of issuance or the date which is 30 Business Days preceding the Termination Date.

(b)     Procedure for Issuance of Letters of Credit.  Whenever Borrower desires the issuance of a Letter of Credit hereunder, it shall give Agent and Facing Agent at least three (3) Business Days' prior written notice (or such shorter period as may be agreed to by Borrower, Agent and Facing Agent) specifying the day of issuance thereof (which day shall be a Business Day), such notice to be given prior to 11:00 A.M. (New York City time) on the date specified for the giving of such notice.  Each such notice (each, a "Letter of Credit Request") shall be in the form of Exhibit 2.9 hereto and shall specify (A) the proposed issuance date and expiration date, (B) the name(s) of each obligor with respect to such Letter of Credit, (C) Borrower as the account party, (D) the name and address of the beneficiary (which Person shall be reasonably acceptable to Facing Agent), (E) the Stated Amount of such proposed Letter of Credit and (F) the purpose of such Letter of Credit and such other information as Facing Agent may reasonably request.  In addition, each Letter of Credit Request shall contain a description of the terms and conditions to be included in such proposed Letter of Credit.  Promptly after the issuance of or amendment to a Standby Letter of Credit, the Facing Agent shall notify the Borrower and the Agent, in writing, of such issuance or amendment, and such notice shall be accompanied by a copy of such issuance or amendment.  Upon receipt of such notice, the Agent shall notify the Revolving Lenders, in writing of such issuance or amendment and if requested to by a Revolving Lender, the Agent shall provide such Revolving Lender with a copy of such issuance or amendment.  With regards to Commercial Letters of Credit, the Facing Agent shall on the first Business Day of each week provide the Agent by facsimile with a report detailing the aggregate daily outstanding amount of Commercial Letters of Credit issued by such Facing Agent for the prior week.  Unless otherwise specified, all Letters of Credit will be governed by Uniform Customs and Practice for Documentary Credits (the "UCP").  On the Business Day specified by Borrower and upon fulfillment or waiver of the applicable conditions set forth in Article VI,  Facing Agent will issue the requested Letter of Credit to the applicable beneficiary.

(c)     Draws upon Letters of Credit; Reimbursement Obligation.  In the event of any drawing under any Letter of Credit by the beneficiary thereof (each such drawing until reimbursed, an "Unpaid Drawing"), Facing Agent shall give telephonic notice to Borrower and Agent (x) confirming such drawing and (y) of the date on or before which Facing Agent intends to honor such drawing, and Borrower shall reimburse Facing Agent on the day on which such drawing is honored in an amount in same day funds and like currency equal to the amount of such drawing; provided, however, that, anything contained in this Agreement to the contrary notwithstanding, (i) unless Borrower shall have notified Agent and Facing Agent prior to 11:00 A.M. (New York City time) on the Business Day Facing Agent intends to honor such drawing that Borrower intends to reimburse Facing Agent for the amount of such drawing with funds other than the proceeds of Revolving Loans, Borrower shall be deemed to have timely given a Notice of Borrowing to Agent requesting each Revolving Lender to make Revolving Loans which are Base Rate Loans on the date on which such drawing is honored in an amount equal to the amount of such drawing and (ii) subject to satisfaction or waiver of the conditions specified in Section 6.3, each such Revolving Lender shall, on the date of such drawing, make Revolving Loans which are Base Rate Loans in the amount of its Commitment Percentage of such drawing, the proceeds of which shall be applied directly by Agent to reimburse Facing Agent for the amount of such drawing; provided, further, that, if for any reason, proceeds of Revolving Loans are not received by Facing Agent on such date in an amount equal to the amount of such drawing, Borrower shall reimburse Facing Agent, on the Business Day immediately following the date of such drawing, in an amount in same day funds equal to the excess of the amount of such drawing over the amount of such Revolving Loans, if any, which are so received, plus accrued interest on such amount at the rate set forth in Section 3.1(a).

(d)     Lenders' Participation in Letters of Credit.  In the event that Borrower shall fail to reimburse Facing Agent as provided in Section 2.9(c) in an amount equal to the amount of any drawing honored by Facing Agent under a Letter of Credit issued by it in accordance with the terms hereof, Facing Agent shall promptly notify Agent and Agent shall promptly notify each Revolving Lender of the unreimbursed amount of such drawing and of such Revolving Lender's respective participation therein.  Each such Lender shall make available to Facing Agent an amount equal to its Commitment Percentage of such drawing in same day funds, at the office of Facing Agent specified in such notice, not later than 1:00 P.M. (New York City time) on the Business Day after the date such Revolving Lender is notified by Agent.  In the event that any such Revolving Lender fails to make available to Facing Agent the amount of such Revolving Lender's participation in such Letter of Credit as provided in this Section 2.9(d), Facing Agent shall be entitled to recover such amount on demand from such Lender together with interest at the Federal Funds Effective Rate for two Business Days and thereafter at the Base Rate.  Nothing in this Section 2.9(d) shall be deemed to prejudice the right of any Revolving Lender to recover from Facing Agent any amounts made available by such Revolving Lender to Facing Agent pursuant to this Section 2.9(d) in the event that it is determined that the payment with respect to a Letter of Credit by Facing Agent in respect of which payment was made by such Revolving Lender constituted gross negligence or willful misconduct as determined by a court of competent jurisdiction on the part of Facing Agent.  Facing Agent shall distribute to each other Revolving Lender which has paid all amounts payable by it under this Section 2.9(d) with respect to any Letter of Credit issued by Facing Agent such other Revolving Lender's Commitment Percentage of all payments received by Facing Agent from Borrower in reimbursement of drawings honored by Facing Agent under such Letter of Credit when such payments are received.  Upon any change in the Revolving Commitments of the Revolving Lenders pursuant to Section 3.7 or 12.8(c) or otherwise, it is hereby agreed that, with respect to all LC Obligations, there shall be an automatic adjustment to the participations pursuant to this Section 2.9(d) to reflect the new Commitment Percentages of the assigning Lender and the Assignee.

(e)     Fees for Letters of Credit.

(i)     Facing Agent.  Borrower agrees to pay the following amount to Facing Agent with respect to Letters of Credit issued by it for the account of Borrower:

(A)    with respect to drawings made under any Letter of Credit, interest, payable on demand, at a rate which is at all times equal to the sum of (i) 2% per annum, (ii) the Base Rate, and (iii) the Applicable Margin on the amount paid by Facing Agent in respect of each such drawing from the date of the drawing to the date such amount is reimbursed by Borrower (including any such reimbursement out of the proceeds of Revolving Loans pursuant to Section 2.9(c));

(B)    with respect to the issuance or amendment of each Letter of Credit and each drawing made thereunder, documentary and processing charges in accordance with Facing Agent's standard schedule for such charges in effect at the time of such issuance, amendment, transfer or drawing, as the case may be; and

(C)    a facing fee as agreed to between Borrower and the applicable Facing Bank for the applicable Letter of Credit and unless otherwise agreed, shall be payable with respect to the maximum Stated Amount under such outstanding Letters of Credit payable in arrears on the Quarterly Payment Date, on the Termination Date and thereafter, on demand together with customary issuance and drawing charges payable pursuant to clause (B) above; provided, however, if calculation of the facing fee in the manner set forth above would result in a facing fee of less than $500 per year per Letter of Credit, Borrower shall be obligated to pay such additional amount to the applicable Facing Bank so as to provide for a minimum facing fee of $500 per year per Letter of Credit.

(ii)     Participating Lender.  Borrower agrees to pay to Agent for distribution to each participating Revolving Lender in respect of all Letters of Credit outstanding such Revolving Lender's Commitment Percentage of a commission equal to the Applicable Eurodollar Rate Margin with respect to the daily Stated Amount under such outstanding Letters of Credit (the "LC Commission"), payable in arrears on each Quarterly Payment Date, on the Termination Date and thereafter, on demand.  The LC Commission shall be computed from the first day of issuance of each Letter of Credit and on the basis of the actual number of days elapsed over a year of 360 days.

Promptly upon receipt by Facing Agent or Agent of any amount described in clause (i)(A) and clause (ii) of this Section 2.9(e), Facing Agent or Agent shall distribute to each Revolving Lender that has reimbursed Facing Agent in accordance with Section 2.9(d) its Commitment Percentage of such amount.  Amounts payable under clauses (i)(A), (B) and (C) of this Section 2.9(e) shall be paid directly to Facing Agent.

(f)     LC Obligations Unconditional.  Subject to the last paragraph of Section 2.9(g), the obligation of Borrower to reimburse Facing Agent for drawings made under any Letter of Credit issued by it and the obligations of each Revolving Lender under Section 2.9(d) with respect thereto shall be unconditional and irrevocable and shall be paid strictly in accordance with the terms of this Agreement under all circumstances, including, without limitation, any of the following circumstances:

(i)     any lack of validity or enforceability of such Letter of Credit;

(ii)     the existence of any claim, setoff, defense or other right which Borrower or any of its Affiliates may have at any time against a beneficiary or any transferee of such Letter of Credit (or any persons or entities for which any such beneficiary or transferee may be acting), Facing Agent, any Lender or any other Person, whether in connection with this Agreement, the transactions contemplated herein or any unrelated transaction (including any underlying transaction between Borrower or one of its Subsidiaries and the beneficiary of such Letter of Credit);

(iii)    any draft, demand, certificate or any 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, provided the same appears on its face to comply with the draw requirements for the Letter of Credit;

(iv)    payment by Facing Agent under such Letter of Credit against presentation of a demand, draft or certificate or other document which does not comply with the terms of such Letter of Credit, provided the same appears on its face to comply with the draw requirements for the Letter of Credit;

(v)     the fact that an Event of Default or an Unmatured Event of Default shall have occurred and be continuing.

(g)     Indemnification.  In addition to amounts payable as elsewhere provided in this Agreement, Borrower hereby agrees to protect, indemnify, pay and save Facing Agent harmless from and against any and all claims, demands, liabilities, damages, losses, costs, charges and expenses (including reasonable attorneys fees) (other than for Taxes, which shall be covered by Section 4.7) which Facing Agent may incur or be subject to as a consequence, direct or indirect, of (i) the issuance of the Letters of Credit, other than as a result of the gross negligence or willful misconduct of Facing Agent as determined by a court of competent jurisdiction or (ii) the failure of Facing Agent to honor a drawing under any Letter of Credit as a result of any act or omissions, whether rightful or wrongful, of any present or future de jure or de facto government or Governmental Authority (all such acts or omissions herein called "Government Acts").  As between Borrower and Facing Agent, Borrower assumes all risks of the acts and omissions of, or misuse of the Letters of Credit issued by Facing Agent by, the respective beneficiaries of such Letters of Credit.  In furtherance and not in limitation of the foregoing, Facing Agent shall not be responsible: (i) for the form, validity, sufficiency, accuracy, genuineness or legal effect of any document submitted by any party in connection with the application for and issuance of or any drawing under such Letters of Credit, even if it should in fact prove to be in any or all respects invalid, insufficient, inaccurate, fraudulent or forged, provided such document appears on its face to comply with the requirements applicable to it; (ii) for the validity or sufficiency of any instrument transferring or assigning or purporting to transfer or assign any such Letter of Credit or the rights or benefits thereunder or proceeds thereof, in whole or in part, which may prove to be invalid or ineffective for any reason; (iii) for failure of the beneficiary of any such Letter of Credit to comply fully with conditions required in order to draw upon such Letter of Credit; (iv) for errors, omissions, interruptions or delays in transmission or delivery of any messages, by mail, cable, telegraph, telex or otherwise, whether or not they be in cipher; (v) for errors in interpretation of technical terms; (vi) for any loss or delay in the transmission or otherwise of any document required in order to make a drawing under any such Letter of Credit or of the proceeds thereof; (vii) for the misapplication by the beneficiary of any such Letter of Credit of the proceeds of any drawing under such Letter of Credit; and (viii) for any consequences arising from causes beyond the control of Facing Agent, including, without limitation, any Government Acts.  None of the above shall affect, impair, or prevent the vesting of any of Facing Agent's rights or powers hereunder.

In furtherance and extension and not in limitation of the specific provisions hereinabove set forth, any action taken or omitted by Facing Agent under or in connection with the Letters of Credit issued by it or the related certificates, if taken or omitted in good faith, shall not put Facing Agent under any resulting liability to Borrower.  Notwithstanding anything to the contrary contained in this Agreement, Borrower shall have no obligation to indemnify Facing Agent in respect of any liability incurred by Facing Agent arising solely out of the gross negligence or willful misconduct of Facing Agent.  The right of indemnification in the first paragraph of this Section 2.9(g) shall not prejudice any rights that Borrower may otherwise have against Facing Agent with respect to a Letter of Credit issued hereunder.

 (h)    Increased Costs.  If at any time after the Closing Date, any Facing Agent or any Lender determines that the introduction of or any change in any applicable law, rule, regulation, order, guideline or request or in the interpretation or administration thereof by any Governmental Authority charged with the interpretation or administration thereof, or compliance by such Facing Agent or such Lender with any request or directive by any such authority (whether or not having the force of law), shall either (i) impose, modify or make applicable any reserve, deposit, capital adequacy or similar requirement against Letters of Credit issued by Facing Agent or participated in by any Lender, or (ii) impose on any Facing Agent or any Lender any other conditions relating, directly or indirectly, to this Agreement or any Letter of Credit; and the result of any of the foregoing is to increase the cost to any Facing Agent or any Lender of issuing, maintaining or participating in any Letter of Credit, or reduce the amount of any sum received or receivable by any Facing Agent or any Lender hereunder or reduce the rate of return on its capital with respect to Letters of Credit, then, upon demand to Borrower by Facing Agent or any Lender (a copy of which demand shall be sent by such Facing Agent or such Lender to Agent), Borrower shall pay to such Facing Agent or such Lender such additional amount or amounts as will compensate such Facing Agent or such Lender for such increased cost or reduction in the amount receivable or reduction on the rate of return on its capital.  In determining such additional amounts pursuant to the preceding sentence, such Facing Agent or such Lender will act reasonably and in good faith and will, to the extent the increased costs or reductions in amounts receivable or reductions in rates of return relate to such Facing Agent's or such Lender's letters of credit in general and are not specifically attributable to the Letters of Credit hereunder, use averaging and attribution methods which are reasonable and which cover all letters of credit similar to the Letters of Credit issued by or participated in by such Facing Agent or such Lender whether or not the documentation for such other Letters of Credit permit such Facing Agent or such Lender to receive amounts of the type described in this Section 2.9(i).  Any Facing Agent or any Lender, upon determining that any additional amounts will be payable pursuant to this Section 2.9(i), will give prompt written notice thereof to Borrower, which notice shall include a certificate submitted to Borrower by such Facing Agent or such Lender (a copy of which certificate shall be sent by such Facing Agent or such Lender to Agent), setting forth in reasonable detail the basis for the calculation of such additional amount or amounts necessary to compensate such Facing Agent or such Lender, although failure to give any such notice shall not release or diminish Borrower's obligations to pay additional amounts pursuant to this Section 2.9(i) provided that Borrower shall not be required to compensate a Lender or a Facing Agent pursuant to this section for any increased costs or reductions incurred more than 180 days prior to the date that such Lender or such Facing Agent, as the case may be, notifies Borrower of the additional amounts and of such Lender's or Facing Agent's intention to claim compensation therefor; provided further that, if the change in law giving rise to such increased costs or reductions is retroactive, then the 180-day period referred to above shall be extended to include the period of retroactive effect thereof. The certificate required to be delivered pursuant to this Section 2.9(i) shall, absent demonstrable error, be final, conclusive and binding on Borrower and the Facing Agent or the Lender, as applicable.

ARTICLE III
INTEREST AND FEES

3.1    Interest.

(a)     Base Rate Loans.  Borrower agrees to pay interest in respect of the unpaid principal amount of each Base Rate Loan at a rate per annum equal to the Base Rate plus the Applicable Margin from the date the proceeds thereof are made available to Borrower until the earlier of (i) the maturity (whether by acceleration or otherwise) of such Base Rate Loan or (ii) the conversion of such Base Rate Loan to a Eurodollar Loan pursuant to Section 2.6.

(b)     Eurodollar Loans.  Borrower agrees to pay interest in respect of the unpaid principal amount of each Eurodollar Loan from the date the proceeds thereof are made available to Borrower until the earlier of (i) the maturity (whether by acceleration or otherwise) of such Eurodollar Loan or (ii) the conversion of such Eurodollar Loan to a Base Rate Loan pursuant to Section 2.6 at a rate per annum equal to the relevant Eurodollar Rate plus the Applicable Margin

(c)     Payment of Interest.  Interest on each Loan shall be payable in arrears on each Interest Payment Date; provided, however, that interest accruing pursuant to Section 3.1(e) shall be payable from time to time on demand.  Interest shall also be payable on all then outstanding Loans on the Termination Date and on all Loans on the date of repayment (including prepayment) thereof (except that voluntary prepayments of Revolving Loans that are Base Rate Loans made pursuant to Section 4.2 on any day other than an Interest Payment Date or the Termination Date need not be made with accrued interest from the most recent Quarterly Payment Date, provided such accrued interest is paid on the next Interest Payment Date) and on the date of maturity (by acceleration or otherwise) of such Loans.  During the existence of any Event of Default, interest on any Loan shall be payable on demand.

(d)     Notification of Rate.  Agent, upon determining in accordance herewith the interest rate for any Borrowing of Eurodollar Loans for any Interest Period, shall promptly notify Borrower and the Lenders thereof.  Such determination shall, absent demonstrable error and subject to Section 3.6, be final, conclusive and binding upon all parties hereto.

(e)     Default Interest.  Notwithstanding the rates of interest specified herein, effective on the date 30 days after the occurrence and continuance during such 30 day period of any Event of Default (other than the failure to pay Obligations when due) and for so long thereafter as any Event of Default shall be continuing, and effective immediately upon any failure to pay any Obligations or any other amounts due under any of the Loan Documents when due, whether by acceleration or otherwise, the principal balance of each Loan then outstanding and, to the extent permitted by applicable law, any interest payment on each Loan not paid when due or other amounts then due and payable shall bear interest payable on demand, after as well as before judgment at a rate per annum equal to the Default Rate.

(f)     Maximum Interest.  If any interest payment or other charge or fee payable hereunder exceeds the maximum amount then permitted by applicable law, Borrower shall be obligated to pay the maximum amount then permitted by applicable law and Borrower shall continue to pay the maximum amount from time to time permitted by applicable law until all such interest payments and other charges and fees otherwise due hereunder (in the absence of such restraint imposed by applicable law) have been paid in full.

3.2    Fees.

(a)     Commitment Fee.  On each Quarterly Payment Date, and on the Termination Date (or, if earlier, on the date upon which the Revolving Commitments are terminated and the Loans are paid in full and the LC Obligations are paid in full or cash collateralized in a manner satisfactory to Agent), Borrower shall pay to Agent, for the ratable benefit of the Lenders, a commitment fee equal to the Applicable Commitment Fee which accrued during the quarterly period most recently ended (or, in the case of the payment due on the Termination Date, the portion thereof ending on such date).  Such commitment fee shall be based upon the average unused Revolving Commitments of the Lenders during the preceding quarter.

(b)     Agency Fees.  Borrower shall pay to Agent for its own account, agency and other Loan fees in the amount and at the times set forth in the letter agreement between Borrower and Agent.

(c)     Third Amended and Restated Credit Agreement Fees.  In consideration of the execution of the Third Amended and Restated Credit Agreement by the Agent and the Lenders, the Borrower hereby agrees to pay to each Lender executing this Agreement a fee in an amount equal to (a) such Lender's Revolving Commitment in effect on the Third Amended and Restated Effective Date (after giving effect to the Third Amended and Restated Credit Agreement) plus the aggregate outstanding principal amount of such Lender's Term Loans multiplied by (b) 0.500%.  

(d)     July 1, 2003 Special Fee.  Borrower shall pay on July 1, 2003, a special one-time fee to each Lender in an amount equal to (a) such Lender's Revolving Commitment (as in effect on such date) plus the aggregate outstanding principal amount of such Lender's Term Loans (as outstanding on such date) multiplied by (b) 0.750%.  

3.3    Computation of Interest and Fees.  Interest on all Loans and fees payable hereunder shall be computed on the basis of the actual number of days elapsed over a year of 360 days; provided that interest on all Base Rate Loans shall be computed on the basis of the actual number of days elapsed over a year of 365 or 366 days, as the case may be.  Each determination of an interest rate by Agent pursuant to any provision of this Agreement and in accordance therewith shall be conclusive and binding on Borrower, Agent and the Lenders in the absence of demonstrable error.  Agent shall, at any time and from time to time upon request of Borrower, deliver to Borrower a statement showing the quotations used by Agent in determining any interest rate applicable to Loans pursuant to this Agreement.  Each change in the Applicable Margin, the Applicable Commitment Fee or any change in the applicable LC Commission as a result of a change in Borrower's Most Recent Ratio of Total Debt to EBITDA shall become effective on the Adjustment Date.

3.4    Interest Periods.  At the time it gives any Notice of Borrowing or a Notice of Conversion or Continuation with respect to Eurodollar Loans, Borrower shall elect, by giving Agent written notice, the interest period (each an "Interest Period") which Interest Period shall, at the option of Borrower, be one, two, three or six months, provided that:

(i)     all Eurodollar Loans comprising a single Borrowing shall at all times have the same Interest Period;

(ii)     the initial Interest Period for any Eurodollar Loan shall commence on the date of such Borrowing of such Eurodollar Loan (including the date of any conversion thereto from a Loan of a different Type) and each Interest Period occurring thereafter in respect of such Eurodollar Loan shall commence on the last day of the immediately preceding Interest Period;

(iii)    if any Interest Period relating to a Eurodollar Loan begins on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period, such Interest Period shall end on the last Business Day of such calendar month;

(iv)    if any Interest Period would otherwise expire on a day which is not a Business Day, such Interest Period shall expire on the next succeeding Business Day; provided, however, that if any Interest Period for a Eurodollar Loan would otherwise expire on a day which is not a Business Day but is a day of the month after which no further Business Day occurs in such month, such Interest Period shall expire on the next preceding Business Day;

(v)     no Interest Period may be selected at any time when an Unmatured Event of Default or Event of Default is then in existence; and

(vi)    no Interest Period shall extend beyond the Termination Date.

3.5    Compensation for Funding Losses.

(a)     Borrower shall compensate each Lender, upon its written request (which request shall set forth in reasonable detail the basis for requesting such amounts), for all losses, expenses and liabilities (including, without limitation, any interest paid by such Lender to lenders of funds borrowed by it to make or carry its Eurodollar Loans to the extent not recovered by the Lender in connection with the liquidation or re-employment of such funds and including the compensation payable by such Lender to a Participant but excluding loss of anticipated profit with respect to any Loans) and any loss sustained by such Lender in connection with the liquidation or re-employment of such funds (including, without limitation, a return on such liquidation or re-employment that would result in such Lender receiving less than it would have received had such Eurodollar Loan remained outstanding until the last day of the Interest Period applicable to such Eurodollar Loans) which such Lender may sustain as a result of (regardless of whether such events occur as a result of an Event of Default or Unmatured Event of Default or the exercise of any right or remedy of Agent or the Lenders under this Agreement or any other agreement, or at law): (i) any failure by Borrower to continue or borrow, or convert from or into, Eurodollar Loans on a date specified therefor in a Notice of Borrowing or Notice of Conversion or Continuation delivered by Borrower (whether or not withdrawn); (ii) any payment, prepayment or conversion or continuation of any of its Eurodollar Loans occurring for any reason whatsoever on a date which is not the last day of an Interest Period applicable thereto; (iii) any repayment of any of its Eurodollar Loans not being made on the date specified in a notice of payment given by Borrower; or (iv) (A) any other failure by Borrower to repay its Eurodollar Loans when required by the terms of this Agreement or (B) an election made by Borrower pursuant to Section 3.7.  Such a written request as to additional amounts owed such Lender under this Section 3.5 and delivered to Borrower and Agent by such Lender shall, absent demonstrable error, be final, conclusive and binding for all purposes.

(b)     Calculation of all amounts payable to a Lender under this Section 3.5 shall be made as though that Lender had actually funded its relevant Eurodollar Loan through the purchase of a Eurodollar deposit bearing interest at the Eurodollar Rate in an amount equal to the amount of that Loan, having a maturity comparable to the relevant Interest Period and through the transfer of such Eurodollar deposit from an offshore office of that Lender to a domestic office of that Lender in the United States of America; provided, however, that each Lender may fund each of its Eurodollar Loans in any manner it sees fit and the foregoing assumption shall be utilized only for the calculation of amounts payable under this Section 3.5.

3.6    Increased Costs, Illegality, Etc.

(a)     Generally.  In the event that:

(i)     on any Interest Rate Determination Date, by reason of any changes arising after the date of this Agreement affecting the interbank Eurodollar market, adequate and fair means do not exist for ascertaining the applicable interest rate on the basis provided for in the definition of Eurodollar Rate; or

(ii)     at any time, any Lender shall incur increased costs or reduction in the amounts received or receivable hereunder with respect to any Eurodollar Loan because of (x) any change since the date of this Agreement in any applicable law or governmental rule, regulation, order, guideline or request (whether or not having the force of law) or in the interpretation or administration thereof and including the introduction of any new law or governmental rule, regulation, order, guideline or request, such as, for example, but not limited to: (A) a change in the basis of taxation of payments to any Lender of the principal of or interest on the Notes or any other amounts payable hereunder (except for (a) changes in the rate of tax on, or determined by reference to, the net income or profits of such Lender imposed by the jurisdiction in which its principal office or applicable lending office is located and (b) United States withholding taxes, which shall be governed by the provisions of Section 4.6) or (B) a change in official reserve requirements (but, in all events, excluding reserves required under Regulation D to the extent included in the computation of the Eurodollar Rate) and/or (y) other circumstances since the date of this Agreement affecting such Lender or the interbank Eurodollar market or the position of such Lender in such market (excluding, however, differences in a Lender's cost of funds from those of Agent which are solely the result of credit differences between such Lender and Agent); or

(iii)    at any time, the making or continuance of any Eurodollar Loan has been made (x) unlawful by any law or governmental rule, regulation or order, (y) impossible by compliance by any Lender in good faith with any governmental request (whether or not having force of law) or (z) impracticable as a result of a contingency occurring after the date of this Agreement which materially and adversely affects the interbank Eurodollar market;

then, and in any such event, such Lender (or Agent, in the case of clause (i) above) shall promptly give notice (by telephone confirmed in writing), which notice shall, absent demonstrable error, be final and conclusive and binding upon all parties hereto, to Borrower and, except in the case of clause (i) above, to Agent of such determination (which notice Agent shall promptly transmit to each of the other Lenders).  Thereafter (x) in the case of clause (i) above, Eurodollar Loans shall no longer be available until such time as Agent notifies Borrower and the Lenders that the circumstances giving rise to such notice by Agent no longer exist, and any Notice of Borrowing or Notice of Conversion or Continuation given by Borrower with respect to Eurodollar Loans (other than with respect to conversions to Base Rate Loans) which have not yet been incurred (including by way of conversion) shall be deemed rescinded by Borrower, (y) in the case of clause (ii) above, Borrower shall pay to such Lender, upon written demand therefor, such additional amounts (in the form of an increased rate of, or a different method of calculating, interest or otherwise as such Lender shall reasonably determine) as shall be required to compensate such Lender for such increased costs or reductions in amounts received or receivable hereunder (a written notice as to the additional amounts owed to such Lender, showing the basis for the calculation thereof, submitted to Borrower by such Lender shall, absent demonstrable error, be final and conclusive and binding on all the parties hereto; however the failure to give any such notice shall not release or diminish Borrower's obligations to pay additional amounts pursuant to this Section 3.6 (a)(y) provided that Borrower shall not be required to compensate such Lender pursuant to this section for any increased costs or reductions incurred more than 180 days prior to the date that such Lender notifies Borrower of the increased costs or reductions and of such Lender's intention to claim compensation therefor; provided further that, if the change in law giving rise to such increased costs or reductions is retroactive, then the 180-day period referred to above shall be extended to include the period of retroactive effect thereof and (z) in the case of clause (iii) above, Borrower shall take one of the actions specified in Section 3.6(b) as promptly as possible and, in any event, within the time period required by law.  In determining such additional amounts pursuant to clause (y) of the immediately preceding sentence, each Lender shall act reasonably and in good faith and will, to the extent the increased costs or reductions in amounts receivable relate to such Lender's loans in general and are not specifically attributable to a Loan hereunder, use averaging and attribution methods which are reasonable and which cover all loans similar to the Loans made by such Lender whether or not the loan documentation for such other loans permits the Lender to receive increased costs of the type described in this Section 3.6(a).

(b)     Eurodollar Loans.  At any time that any Eurodollar Loan is affected by the circumstances described in Section 3.6(a)(ii) or (iii), Borrower may (and, in the case of a Eurodollar Loan affected by the circumstances described in Section 3.6(a)(iii), shall) either (i) if the affected Eurodollar Loan is then being made initially or pursuant to a conversion, cancel the respective Borrowing by giving Agent telephonic notice (confirmed in writing) on the same date that Borrower was notified by the affected Lender or Agent pursuant to Section 3.6(a)(ii) or (iii), or (ii) if the affected Eurodollar Loan is then outstanding, upon at least three Business Days' written notice to Agent, require the affected Lender to convert such Eurodollar Loan into a Base Rate Loan, provided, that if more than one Lender is affected at any time, then all affected Lenders must be treated the same pursuant to this Section 3.6(b).

(c)     Capital Requirements.  If any Lender determines that the introduction of or any change in any applicable law or governmental rule, regulation, order, guideline or request (whether or not having the force of law) concerning capital adequacy, or any change in (after the date of this Agreement) interpretation or administration thereof by any Governmental Authority, central bank or comparable agency, will have the effect of increasing the amount of capital required or expected to be maintained by such Lender or any corporation controlling such Lender based on the existence of such Lender's Revolving Commitment or Term Loans hereunder or its obligations hereunder, then Borrower shall pay to such Lender, upon its written demand therefor, such additional amounts as shall be required to compensate such Lender or such other corporation for the increased cost to such Lender or such other corporation or the reduction in the rate of return to such Lender or such other corporation as a result of such increase of capital.  In determining such additional amounts, each Lender will act reasonably and in good faith and will use averaging and attribution methods which are reasonable and which will, to the extent the increased costs or reduction in the rate of return relates to such Lender's commitments or obligations in general and are not specifically attributable to the Revolving Commitments, Term Loans and obligations hereunder, cover all commitments and obligations similar to the Revolving Commitment or Term Loans and obligations of such Lender hereunder whether or not the loan documentation for such other commitments or obligations permits the Lender to make the determination specified in this Section 3.6(c), and such Lender's determination of compensation owing under this Section 3.6(c) shall, absent demonstrable error, be final and conclusive and binding on all the parties hereto.  Each Lender, upon determining that any additional amounts will be payable pursuant to this Section 3.6(c), will give prompt written notice thereof to Borrower, which notice shall show in reasonable detail the basis for calculation of such additional amounts, although the failure to give any such notice shall not release or diminish any of Borrower's obligations to pay additional amounts pursuant to this Section 3.6(c) provided that Borrower shall not be required to compensate such Lender pursuant to this Section 3.6(c) for any increased costs or reductions incurred more than 180 days prior to the date that such Lender notifies Borrower of the increased costs or reductions and of such Lender's intention to claim compensation therefor; provided further that, if the change in law giving rise to such increased costs or reductions is retroactive, then the 180-day period referred to above shall be extended to include the period of retroactive effect thereof.

(d)     Change of Lending Office.  Each Lender which is or will be owed compensation pursuant to Section 3.6(a) or (c) will, if requested by Borrower, use reasonable efforts (subject to overall policy considerations of such Lender) to cause a different branch or Affiliate to make or continue a Loan or Letter of Credit if such designation will avoid the need for, or materially reduce the amount of, such compensation to such Lender and will not, in the judgment of such Lender, be otherwise disadvantageous to such Lender.  Borrower hereby agrees to pay all reasonable expenses incurred by any Lender in utilizing a different branch or Affiliate pursuant to this Section 3.6(d).  Nothing in this Section 3.6(d) shall affect or postpone any of the obligations of Borrower or the right of any Lender provided for herein.

3.7    Replacement of Affected Lenders.  (x) If any Lender becomes a Defaulting Lender or otherwise defaults in its Obligations to make Revolving Loans or fund Unpaid Drawings, (y) if any Lender is owed increased costs under Section 3.6(a)(ii) or (iii), Section 3.6(c) or Borrower is required to make any payments under Section 4.6 to any Lender materially in excess of those to the other Lenders or (z) as provided in Section 11.1(b) in the case of certain refusals by a Lender to consent to certain proposed amendments, changes, supplements, waivers, discharges or terminations with respect to this Agreement which have been approved by the Required Lenders, Borrower shall have the right, if no Event of Default or Unmatured Event of Default then exists, to replace such Lender (the "Replaced Lender") with one or more other Eligible Assignee or Eligible Assignees, none of whom shall be a Defaulting Lender at the time of such replacement (collectively, the "Replacement Lender") acceptable to Agent, provided that (i) at the time of any replacement pursuant to this Section 3.7, the Replacement Lender shall enter into one or more assignment agreements, in the form of Exhibit 11.9 hereto, pursuant to which the Replacement Lender shall acquire all of the Commitments and outstanding Loans of the Replaced Lender and (ii) all obligations of Borrower owing to the Replaced Lender (including, without limitation, any such increased costs and excluding those specifically described in clause (i) above in respect of which the assignment purchase price has been, or is concurrently being paid) shall be paid in full to such Replaced Lender concurrently with such replacement.  Upon the execution of the respective assignment documentation, the payment of amounts referred to in clauses (i) and (ii) above and, if so requested by the Replacement Lender, delivery to the Replacement Lender of the appropriate Note or Notes executed by Borrower, the Replacement Lender shall become a Lender hereunder and the Replaced Lender shall cease to constitute a Lender hereunder, except with respect to indemnification provisions under this Agreement, which shall survive as to such Replaced Lender.  Notwithstanding anything to the contrary contained above, no Lender that acts as a Facing Agent may be replaced hereunder at any time which it has Letters of Credit outstanding hereunder unless arrangements satisfactory to such Facing Agent (including the furnishing of a standby letter of credit in form and substance, and issued by an issuer satisfactory to such Facing Agent or the depositing of cash collateral into the Collateral Account in amounts and pursuant to arrangements satisfactory to such Facing Agent) have been made with respect to such outstanding Letters of Credit.

ARTICLE IV
REDUCTION OF COMMITMENTS; PAYMENTS AND PREPAYMENTS

4.1    Voluntary Reduction of Commitments.  Upon at least three Business Days' prior written notice (or telephonic notice confirmed in writing) to Agent at the Notice Office (which notice Agent shall promptly transmit to each Lender), Borrower shall have the right, from time to time and without premium or penalty, to terminate the unutilized portion of the Revolving Commitments or the Swing Line Commitment, as the case may be, in part or in whole; provided that (x) any such voluntary termination of the Revolving Commitments shall apply to proportionately and permanently reduce the Revolving Commitment of each Revolving Lender, (y) any partial voluntary reduction pursuant to this Section 4.1 shall be in the amount of at least $5,000,000 and integral multiples of $5,000,000 in excess of that amount and (z) no such voluntary termination of the Revolving Commitments shall be permitted if the effect thereof would be to reduce the total of the Revolving Commitments below the aggregate principal amount of outstanding Revolving Loans plus the aggregate LC Obligations and the Swing Line Loan Commitment.  The parties hereto acknowledge that the Borrower on the Restatement Date and prior to the Term Loan Conversion permanently reduced the Revolving Commitments by the amount of the Revolver Commitment Reduction .  The parties hereto further acknowledge that on the Third Amended and Restated Effective Date the Borrower further permanently reduced the Revolving Commitments by $20,000,000.

4.2    Voluntary Prepayments.  (a)  Borrower shall have the right to prepay any or all of the Loans in whole or in part from time to time on the following terms and conditions: (i) Borrower shall give Agent irrevocable written notice at its Notice Office (or telephonic notice promptly confirmed in writing) of its intent to prepay, the amount of such prepayment and the specific Borrowings to which such prepayment is to be applied, which notice shall be given by Borrower to Agent by 12:00 noon (New York City time) at least three Business Days prior to the date of such prepayment and which notice shall (except in the case of Swing Line Loans) promptly be transmitted by Agent to each of the applicable Lenders; (ii) each partial prepayment of any Borrowing (other than a Borrowing of Swing Line Loans) shall be in an aggregate principal amount of at least $1,000,000 and each partial prepayment of a Swing Line Loan shall be in an aggregate principal amount of at least $500,000; provided that no partial prepayment of Eurodollar Loans made pursuant to a single Borrowing shall reduce the aggregate principal amount of the outstanding Loans made pursuant to such Borrowing to an amount less than the Minimum Borrowing Amount applicable thereto; (iii) Eurodollar Loans may only be prepaid pursuant to this Section 4.2 on the last day of an Interest Period applicable thereto or on any other day subject to Section 3.5; (iv) each prepayment in respect of any Borrowing shall be applied pro rata among the Loans comprising such Borrowing provided, that such prepayment shall not be applied to any Loans of a Defaulting Lender at any time when the aggregate amount of Loans of any Non-Defaulting Lender exceeds such Non-Defaulting Lender's Commitment Percentage of all Loans then outstanding.  Voluntary prepayments of Term Loans may not be made utilizing proceeds of Revolving Loans or Swing Line Loans and shall be applied first to the Scheduled Term A Repayments and the Scheduled Term B Repayments due within the 6 month period following the date of such prepayment in direct order of maturity and, thereafter, shall be applied in proportional amounts equal to the Term A Percentage and Term B Percentage (in each case, after giving effect to the prepayments made to the Scheduled Term A Repayments and Scheduled Term B Repayments due within such 6 month period as specified above), as the case may be, of such remaining prepayment, if any, and within each Term Loan, shall be applied to reduce the remaining Scheduled Term A Repayments and Scheduled Term B Repayments on a pro rata basis. The notice provisions, the provisions with respect to the minimum amount of any prepayment, and the provisions requiring prepayments in integral multiples above such minimum amount of this Section 4.2 are for the benefit of Agent and may be waived unilaterally by Agent.

(b)     In the event of certain refusals by a Lender to consent to certain proposed amendments, changes, supplements, waivers, discharges or terminations with respect to this Agreement which have been approved by the Required Lenders as provided in Section 11.1(b), Borrower shall have the right, upon five (5) Business Days' prior written notice to Agent (which notice Agent shall promptly transmit to each of the Lenders), to repay all Loans, together with accrued and unpaid interest, fees  and all other amounts due and owing to such Lender in accordance with said Section 11.1(b), so long as (A) in the case of the repayment of Revolving Loans of any Revolving Lender pursuant to this clause (b), the Revolving Commitment of such Revolving Lender is terminated concurrently with such repayment pursuant to Section 4.1(b) and (B) in the case of the repayment of Loans of any Lender, the consents required by Section 11.1(b) in connection with the repayment pursuant to this clause (b) shall have been obtained.

4.3    Mandatory Prepayments.

(a)     Prepayment Upon Overadvance.  Borrower shall prepay the outstanding principal amount of the Revolving Loans or the Swing Line Loan on any date on which the aggregate outstanding principal amount of such Loanstogether with the aggregate LC Obligations (after giving effect to any other repayments or prepayments on such day) exceeds the aggregate Revolving Commitments or the Swing Line Loan Commitment, as the case may be, in the amount of such excess; provided, however, if at any time the aggregate of all Revolving Loans then outstanding plus the aggregate amount of all LC Obligations and Swing Line Loans then outstanding exceeds the lesser of (i) the Borrowing Base and (ii) the Total Revolving Commitment, the Borrower shall immediately, and without notice or demand, prepay the outstanding principal amount of the Revolving Loans and Swing Line Loans by an amount equal to the applicable excess.  If, after giving effect to the prepayment of all outstanding Revolving Loans, the aggregate LC Obligations exceeds the lesser of (i) the Borrowing Base and (ii) the Total Revolving Commitment then in effect, Borrower shall cash collateralize LC Obligations by depositing, pursuant to a cash collateral agreement to be entered into in form and substance reasonably satisfactory to Agent and Borrower, cash with Agent in an amount equal to the difference between such LC Obligations and the lesser of (i) the Borrowing Base and (ii) the Total Revolving Commitment then in effect.  Agent shall establish in its name for the benefit of the Revolving Lenders a cash collateral account (the "Collateral Account") into which it shall deposit such cash to hold as collateral security for the LC Obligations.

(b)     Payment at Termination Date.  Borrower hereby unconditionally promises to pay to each Lender on the Termination Date, the unpaid principal amount of each Loan (including, without limitation, each Swing Line Loan) made by such Lender.  Borrower hereby further agrees to pay interest in immediately available funds at the office of Agent on the unpaid principal amount of such Loans from time to time from the date hereof until payment in full thereof at the rates per annum, and on the dates, set forth in Section 2.6.

(c)     Mandatory Prepayment Upon Asset Disposition.  On the first Business Day after the date of receipt thereof by Borrower and/or any of its Subsidiaries of Net Sale Proceeds from any Asset Disposition, an amount equal to 100% of the Net Sale Proceeds from such Asset Disposition shall be applied as a mandatory repayment of principal of the Loans as provided in Section 4.4.

(d)     Mandatory Prepayment Upon Incurrence of Indebtedness.  On the date of receipt by Borrower and/or any of their Subsidiaries of Net Offering Proceeds from the incurrence of Indebtedness, an amount equal to 100% of such Net Offering Proceeds shall be applied as a mandatory prepayment of Loans in the manner set forth in Section 4.4.

(e)     Scheduled Term Repayments.  

       (i)     Scheduled Term A Repayments. Borrower agrees to pay Scheduled Term A Repayments on the Term A Loans until the Term A Loans are paid in full in the amounts and at the times specified in the definition of Scheduled Term A Repayments to the extent that prepayments have not previously been applied to such Scheduled Term A Repayments (and such Scheduled Term A Repayments have not otherwise been reduced) pursuant to the terms hereof.

       (ii)     Scheduled Term B Repayments. Borrower agrees to pay Scheduled Term B Repayments on the Term B Loans until the Term B Loans are paid in full in the amounts and at the times specified in the definition of Scheduled Term B Repayments to the extent that prepayments have not previously been applied to such Scheduled Term B Repayments (and such Scheduled Term B Repayments have not otherwise been reduced) pursuant to the terms hereof.

(f)     Mandatory Prepayment With Excess Cash Flow.  On each Excess Cash Payment Date, an amount equal to 75% of Excess Cash Flow, if positive, of Borrower and its Subsidiaries for the most recent Excess Cash Flow Period ending prior to such Excess Cash Payment Date shall be applied as a mandatory repayment of principal of the Loans as provided in Section 4.4.

(g)     Mandatory Prepayment Upon Recovery Event.  Within fifteen (15) days following each date on which Borrower or any of its Subsidiaries receives any proceeds from any Recovery Event, an amount equal to 100% of the proceeds of such Recovery Event (net of reasonable costs and taxes incurred in connection with such Recovery Event) shall be applied as a mandatory repayment of principal of the Loans as provided in Section 4.4, provided that (1) so long as no Event of Default or Unmatured Event of Default then exists, if the net proceeds from any Recovery Event are less than $500,000, then no prepayment shall be required pursuant to this Section 4.3(g), and (2) so long as no Event of Default or Unmatured Event of Default then exists, with respect to any single or series of related Recovery Events the net proceeds therefrom which are equal to or greater than $500,000 but less than $1,000,000, such proceeds shall not be required to be so applied on such date to the extent that Borrower has delivered a certificate to the Agent on or prior to such date stating that such proceeds shall be used to replace or restore any properties or assets in respect of which such proceeds were paid within 180 days following the date of the receipt of such proceeds (which certificate shall set forth the estimates of the proceeds to be so expended) provided, further, that (i) if the amount of such proceeds from any single or series of related Recovery Events exceeds $1,000,000, then the entire amount and not just the portion in excess of $1,000,000 shall be applied as a mandatory repayment of Loans as provided above in this Section 4.3(g) and (ii) if all or any portion of such proceeds not required to be applied to the repayment of Loans pursuant to the first proviso of this Section 4.3(g) are not so used (or contractually committed to be used) within 180 days after the day of the receipt of such proceeds, such remaining portion shall be applied on the last day of such period as a mandatory repayment of principal of the Loans as provided in this Section 4.3(g).

4.4    Application of Prepayments. Except as expressly provided in this Agreement, all prepayments of principal made by Borrower pursuant to Section 4.3(c),(d), (f) and (g) shall be applied (i) first to the payment of the unpaid principal amount of the Term Loans (with the Term A Percentage of such repayment to be applied as a repayment of Term A Loans and the Term B Percentage of such repayment to be applied as a repayment of Term B Loans), after all Term A and Term B Loans have been paid in full, second to the payment of the then outstanding balance of the Revolving Loans and third, after all Revolving Loans have been paid in full, to the cash collateralization of LC Obligations; (ii) within each of the foregoing Loans, first to the payment of Base Rate Loans and second to the payment  of Eurodollar Loans; and (iii) with respect to Eurodollar Loans, in such order as Borrower shall request (and in the absence of such request, as Agent shall determine so as to minimize breakage costs).  Each prepayment of the Term Loans pursuant to Sections 4.3(c) and (d)  shall be applied to the Term Loans in proportional amounts equal to the Term A Percentage and Term B Percentage, as the case may be, of such remaining prepayment, if any and, within each Term Loan, shall be applied first to the Scheduled Term A Repayments and the Scheduled Term B Repayments due within the 6 month period following the date of such prepayment in direct order of maturity and, thereafter to reduce the remaining Scheduled Term A Repayments and Scheduled Term B Repayments on a pro rata basis (based upon the then remaining principal amount of such Scheduled Term A Repayments and Scheduled Term B Repayments, respectively).  Each prepayment of the Term Loans pursuant to Sections 4.3(f) and (g) shall be applied to the Term Loans in proportional amounts equal to the Term A Percentage and Term B Percentage, as the case may be, of such remaining prepayment, if any and, within each Term Loan, shall be applied to reduce the remaining Scheduled Term A Repayments and Scheduled Term B Repayments on a pro rata basis (based upon the then remaining principal amount of such Scheduled Term A Repayments and Scheduled Term B Repayments, respectively).  If any prepayment of Eurodollar Loans made pursuant to a single Borrowing shall reduce the outstanding Loans made pursuant to such Borrowing to an amount less than the Minimum Borrowing Amount, such Borrowing shall immediately be converted into Base Rate Loans.  All prepayments shall include payment of accrued interest on the principal amount so prepaid, shall be applied to the payment of interest before application to principal and shall include amounts payable, if any, under Section 3.5.

4.5    Method and Place of Payment.

(a)     Except as otherwise specifically provided herein, all payments under this Agreement shall be made to Agent, for the ratable account of the Lenders entitled thereto, not later than 12:00 Noon (New York City time) on the date when due and shall be made in immediately available funds in lawful money of the United States of America and in each case to the account specified therefor for Agent or if no account has been so specified at the Payment Office, it being understood that with respect to payments in Dollars, written telex or telecopy notice by Borrower to Agent to make a payment from the funds in Borrower's account at the Payment Office shall constitute the making of such payment to the extent of such funds held in such account.  Agent will thereafter cause to be distributed on the same day (if payment was actually received by Agent prior to 12:00 Noon (New York City time) on such day) like funds relating to the payment of principal or interest or fees ratably to the Lenders entitled to receive any such payment in accordance with the terms of this Agreement.  If and to the extent that any such distribution shall not be so made by Agent in full on the same day (if payment was actually received by Agent prior to 12:00 Noon (New York City time) on such day), Agent shall pay to each Lender its ratable amount thereof and each such Lender shall be entitled to receive from Agent interest on such amount at the overnight Federal Funds Rate for each day from the date such amount is paid to Agent until the date Agent pays such amount to such Lender.

(b)     Any payments under this Agreement which are made by Borrower later than 12:00 Noon (New York City time) shall, for the purpose of calculation of interest, be deemed to have been made on the next succeeding Business Day.  Whenever any payment to be made hereunder shall be stated to be due on a day which is not a Business Day, the due date thereof shall be extended to the next succeeding Business Day and, with respect to payments of principal, interest shall be payable during such extension at the applicable rate in effect immediately prior to such extension, except that with respect to Eurodollar Loans, if such next succeeding Business Day is not in the same month as the date on which such payment would otherwise be due hereunder or under any Note, the due date with respect thereto shall be the next preceding applicable Business Day.

4.6    Net Payments.

(a)     All payments made by Borrower hereunder or under any Loan Document will be made without setoff, counterclaim or other defense.  Except as provided in Section 4.7(d), all payments hereunder and under any of the Loan Documents (including, without limitation, payments on account of principal and interest and fees) shall be made by Borrower free and clear of and without deduction or withholding for or on account of any present or future tax, duty, levy, impost, assessment or other charge of whatever nature now or hereafter imposed by any Governmental Authority, but excluding therefrom (i) a tax imposed on or measured by the net income, net profits, net receipts or capital (including a branch profits tax or a franchise tax based on net income, net profits, net receipts or capital) of the Lender by the jurisdiction (or political subdivision or taxing authority thereof) in which the Lender is incorporated or organized, or in which it is a citizen, resident or domiciliary or the jurisdiction (or political subdivision or taxing authority thereof) in which any lending office that participated in the making of a loan hereunder is located, (ii) in the case of any Lender organized under the laws of any jurisdiction other than the United States or any state thereof (including the District of Columbia), any taxes imposed by the United States by means of withholding at the source unless, and to the extent that, such withholding results from a change in applicable law, treaty or regulations or the interpretation or administration thereof (including, without limitation, any guideline or policy not having the force of law) by any authority charged with the administration thereof subsequent to the date such Lender becomes a Lender with respect to the Loan or portion thereof affected by such change and (iii) any tax imposed on or measured by the net income, net profits, net receipts or capital (including a branch profits tax, or a franchise tax based on net income, net profits, net receipts or capital) of a Lender or an office or branch thereof by the United States of America or any political subdivision or taxing authority thereof or therein (such tax or taxes, other than a tax or taxes excluded under (i), (ii), or (iii), being herein referred to as "Tax" or "Taxes" and tax or taxes excluded under (i), (ii) or (iii) shall be referred to as "Excluded Taxes").  If Borrower is required by law to make any deduction or withholding of any Taxes from any payment due hereunder or under any of the Loan Documents, then the amount payable will be increased to such amount which, after deduction from such increased amount of all such Taxes required to be withheld or deducted therefrom, will not be less than the amount due and payable hereunder had no such deduction or withholding been required.  A certificate as to any additional amounts payable to a Lender under this Section 4.6 submitted to Borrower by such Lender shall show in reasonable detail the amount payable and the calculations used to determine in good faith such amount and shall, absent manifest error, be final, conclusive and binding upon all parties hereto.

(b)     If Borrower makes any payment hereunder or under any of the Loan Documents in respect of which it is required by law to make any deduction or withholding of any Taxes, it shall pay the full amount to be deducted or withheld to the relevant taxation or other authority within the time allowed for such payment under applicable law and shall deliver to all affected Lenders within 30 days after it has made such payment to the applicable authority any receipt issued by such authority to the Borrower evidencing the payment to such authority of all amounts so required to be deducted or withheld from such payment.

(c)     Without prejudice to the other provisions of Section 4.6, if any Lender, or Agent on its behalf, is required by law to make any payment on account of Taxes on or in relation to any amount received or receivable hereunder or under any of the Loan Documents by such Lender, or Agent on its behalf, or any liability for Tax in respect of any such payment is imposed, levied or assessed against any Lender or Agent on its behalf, Borrower will promptly, following receipt of the certificate described in the immediately following sentence, indemnify such person against such Tax payment or liability, together with any interest, penalties and expenses (including reasonable counsel fees and expenses) payable or incurred in connection therewith, including any tax of any Lender arising by virtue of payments under this Section 4.6(c), computed in a manner consistent with this Section 4.6(c).  A certificate prepared in good faith as to the amount of such payment (showing in reasonable detail the amount payable and the calculations used to determine such amount) by such Lender, or Agent on its behalf, absent manifest error, shall be final, conclusive and binding upon all parties hereto for all purposes.

(d)     Each Lender that is not a United States person (as such term is defined in Section 7701(a)(30) of the Code) agrees to deliver to Borrower and Agent on or prior to the Third Amended and Restated Effective Date, or in the case of a Lender that is an Assignee of an interest under this Agreement pursuant to Section 3.7 or 11.9 (unless the respective Lender was already a Lender hereunder immediately prior to such assignment), on the date of such assignment to such Lender, (i) two accurate and complete original signed copies of IRS Form W-8BEN, W-8ECI, or W-8IMY (or successor or other applicable forms prescribed by the IRS) certifying to such Lender's entitlement to a complete exemption from or reduced rate of United States withholding tax on interest payments to be made under this Agreement and under any Note, or (ii) if the Lender is not a "bank" within the meaning of Section 881(c)(3)(A) of the Code and cannot deliver the applicable form pursuant to clause (i) above, (x) a certificate substantially in the form of Exhibit 4.6(d) (any such certificate, a "Section 4.6(d)(ii) Certificate") and (y) two accurate and complete original signed copies of IRS Form W-8BEN (or successor form), certifying to such Lender's entitlement to a complete exemption from United States withholding tax on payments of interest to be made under this Agreement and under any Note; provided, however, that no Lender shall be required to deliver an IRS Form W-8BEN, W-8ECI, W-8IMY, or Section 4.6(d)(ii) Certificate under this Section 4.6(d) to the extent that the delivery of such form is not authorized by law; provided further, however, that in the event that a Lender provides the Borrower or the Agent with an IRS Form W-8IMY (or substitute form) indicating that it is a "flow through" entity, as defined in Treasury Regulations promulgated under Section 1441 of the Code, or otherwise, not a beneficial owner of interest payments under this Agreement and under any Note, such Lender agrees, on or prior to the Third Amended and Restated Effective Date, or the date of assignment to such Lender, as applicable, to take any actions necessary, and to deliver to Borrower and Agent all forms necessary, to establish such Lender's entitlement to a complete exemption from, or a reduction in, United States withholding tax on payments of interest to be made under this Agreement and under any Note, including causing its partners, members, beneficiaries, beneficial owners, and their beneficial owners, if any, to take any actions and deliver any forms necessary to establish such exemption.  Notwithstanding the foregoing, (i) a fiscally transparent entity may provide an IRS Form W-8BEN to claim a treaty exemption or rate reduction to the extent that such entity is receiving interest and is not treated as fiscally transparent by its own jurisdiction,  provided the satisfaction of such conditions entitles the Lender to an exemption or reduction from withholding at the time such Lender becomes a party to this Agreement and (ii) a withholding foreign partnership, withholding foreign trust, and qualified intermediary shall only provide such information as is required by Treasury Regulations promulgated under Code Section 1441.  For purposes of this Agreement, the term "Forms" shall include any attachments for to IRS Forms W-8 IMY required to be filed by the Lender.  In addition, each Lender agrees that from time to time after the Initial Borrowing Date, when a lapse in time or change in circumstances renders the previous certification obsolete or inaccurate in any material respect, such Lender will deliver to Borrower and Agent two new accurate and complete original signed copies of an IRS Form W-8BEN, W-8ECI, or W-8IMY and a Section 4.6(d)(ii) Certificate, as the case may be, and such other forms as may be required in order to confirm or establish the entitlement of such Lender (or its partners, members, beneficiaries, or beneficial owners) to a continued exemption from or reduction in United States withholding Tax on interest payments under this Agreement and any Note, or it shall immediately notify Borrower and Agent of its inability to deliver any such form or certificate; provided, however, that no Lender shall be required to deliver an IRS Form W8-BEN, W-8ECI, or W-8IMY under this Section 4.6(d) to the extent that the delivery of such form is not authorized by law; provided, further, however, that any Lender which does not deliver the applicable form pursuant to Section 4.6(d) shall be entitled to additional payment pursuant to Section 4.6(a) or indemnification under Section 4.6(c) only if and to the extent (i) such failure results solely from a change in law or (ii) the Tax to which such additional payment or indemnification relates would have been imposed regardless of whether such Lender provided such forms.  Notwithstanding anything to the contrary contained in Section 4.6, any Lender that has not provided to Borrower the IRS Forms required to be provided to Borrower pursuant to this Section 4.6(d) shall not be entitled to any payment of additional amounts pursuant to Section 4.6(a) or indemnification under Section 4.6(c) with respect to any deduction or withholding which would not have been required if such Lender had provided such forms.

(e)     Each Lender that is incorporated or organized under the laws of the United States of America or a state thereof shall provide two properly completed and duly executed copies of IRS Form W-9, or any successor or other applicable form.  Each Lender shall deliver to Borrower and Agent (provided that such Lender remains lawfully able to do so), two further duly executed forms and statements, properly completed in all material respects, at or before 4he time any such form or statement expires or becomes obsolete, or otherwise as reasonably requested by Borrower.  Each Lender shall promptly notify Borrower at any time it determines that it is no longer in a position to provide any previously delivered certificate to Borrower (or any other form or certification adopted by U.S. taxing authorities for such purpose).

(f)     Each Lender agrees that, as promptly as practicable after it becomes aware of the occurrence of any event or the existence of any condition that would cause Borrower to make a payment in respect of any Taxes to such Lender pursuant to Section 4.6(a) or a payment in indemnification for any Taxes pursuant to Section 4.6(c), it will use reasonable efforts to make, fund or maintain the Loan (or portion thereof) of such Lender with respect to which the aforementioned payment is or would be made through another lending office of such Lender or take any other action reasonably requested by Borrower if as a result thereof the additional amounts which would otherwise be required to be paid by such Borrower in respect of such Loans (or portions thereof) or participation in Letters of Creditpursuant to Section 4.6(a) or Section 4.6(c) would be materially reduced, and if, as determined by such Lender, in its reasonable discretion, the making, funding or maintaining of such Loans or participation in Letters of Credit (or portions thereof) through such other lending office or taking of such other action would not otherwise materially adversely affect such Loans or such Lender.  Borrower agrees to pay all reasonable expenses incurred by any Lender in utilizing another lending office of such Lender or taking of such other action pursuant to this Section 4.6(f).

ARTICLE V
REPRESENTATIONS AND WARRANTIES

To induce Agent and each Lender to enter into this Agreement and the Third Amended and Restated Credit Agreement and to make the Loans and issue (or participate in) the Letters of Credit, Borrower hereby represents and warrants to Agent and each Lender, and hereby agrees, as follows:

5.1    Corporate Existence; Compliance with Law.  Each of Borrower and its Subsidiaries (a) is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization, (b) has the corporate power and authority, and the legal right, to own and operate its property, to lease the property it operates as lessee and to conduct the business in which it is currently engaged, (c) is duly qualified and in good standing as a foreign corporation, and is duly authorized to do business, in each jurisdiction where its ownership or leasing of property or the character of its operations makes such qualification necessary, except where the failure to so qualify would not reasonably be expected to have a Material Adverse Effect and (d) is in compliance with all Requirements of Law except to the extent that all failures to comply therewith would not reasonably be expected to have a Material Adverse Effect.

5.2    Corporate Power; Authorization; No Violation.  The execution, delivery and performance by each Credit Party of this Agreement and the other Loan Documents to which it is a party (i) are within such Credit Party's corporate power, (ii) have been duly authorized by all necessary corporate, shareholder and other action on the part of each Person whose authorization is required, (iii) do not violate any Requirement of Law or any material Contractual Obligation applicable to such Credit Party, (iv) will not result in or require the creation or imposition of any Lien of any nature upon or with respect to any of the properties now owned or hereafter acquired by such Person (other than any permitted by the Loan Documents) and (v) will not require any authorization or approval or other action by, or notice to or filing or registration with, any Governmental Authority (other than those which have been obtained and are in force and effect).

5.3    Binding Effect.  This Agreement has been, and the other Loan Documents to which any Credit Party is a party will be when executed and delivered, duly executed and delivered on behalf of Borrower and the other Loan Parties thereto.  This Agreement constitutes, and the other Loan Documents to which any Credit Party is a party when executed and delivered will constitute, a legal, valid and binding obligation of the Loan Parties that are party thereto, enforceable against such Loan Parties in accordance with their respective terms, except as enforcement thereof may be subject to (i) the effect of any applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors' rights generally and (ii) general principles of equity (regardless of whether such enforcement is sought in a proceeding in equity or at law).  The security interests created in favor of Agent, as Pledgee for the benefit of the Lenders under the Pledge Agreement constitute first perfected security interests in the Pledged Stock, subject to no security interests of any other Person.  No filings or recordings are required in order to perfect the security interests created in the Pledged Stock under the Pledge Agreement.

5.4    Purpose of Loans.  The proceeds of the Loans shall be used by Borrower to (i) repay existing indebtedness under the Existing Credit Agreements and (ii) for general corporate and working capital purposes (including without limitation the Asset Acquisition and other Acquisitions).  No proceeds of any of the Loans will be used for "buying," "purchasing," or "carrying," any "margin stock" within the respective meanings of each of the quoted terms under Regulation U of the Board as now and from time to time hereafter in effect or for any purpose which would cause any of the loans or extensions of credit under this Agreement to be considered a "purpose credit" within the meaning of Regulation T, U or X of the Board.  Notwithstanding anything else herein to the contrary, no proceeds of any Revolving Loans will be used to effect (either directly or indirectly) a voluntary or mandatory prepayment of Term Loans hereunder.

5.5    Subsidiaries.  Schedule 5.5 annexed hereto and made a part hereof is a complete and correct list of all Subsidiaries of Borrower as of the Third Amended and Restated Effective Date and separately identifies all Material Subsidiaries of Borrower as of the Third Amended and Restated Effective Date.  All of such Subsidiaries are Wholly‑Owned Subsidiaries of Borrower except as otherwise indicated on such Schedule 5.5.  There does not exist any encumbrance or restriction on the ability of (i) any Subsidiary of Borrower to pay dividends or make any other distributions on its capital stock or any other interest or participation in its profits owned by Borrower or any Subsidiary of Borrower, or to pay any Indebtedness owed to Borrower or a Subsidiary of Borrower, (ii) any Subsidiary of Borrower to make loans or advances to Borrower or any of Borrower's Subsidiaries or (iii) Borrower or any of its Subsidiaries to transfer any of its properties or assets to Borrower or any of its Subsidiaries, except for such encumbrances or restrictions existing under or by reason of (x) applicable law, (y) this Agreement or the other Loan Documents or (z) customary provisions restricting subletting or assignment of any lease or other contract governing a leasehold interest or other contract rights of Borrower or a Subsidiary of Borrower.

5.6    Indebtedness.  Schedule 5.6 annexed hereto and made a part hereof is a complete and correct list of all Indebtedness of Borrower and its Subsidiaries which, in any individual instance exceeds $250,000 in principal amount and which is outstanding as of the Third Amended and Restated Effective Date (other than Intercompany Indebtedness).

5.7    Financial Statements; Financial Condition; Undisclosed Liabilities; Projections, etc.

(a)     Financial Statements.  The balance sheet of Borrower at December 31, 1998, December 31, 1999, December 31, 2000 and December 31, 2001, and the related statements of operations, cash flows and shareholders' equity of Borrower for the Fiscal Year or other period ended on such dates, as the case may be, copies of which have been furnished to the Lenders prior to the date hereof which have been examined by Ernst & Young L.L.P., independent certified public accountants, were prepared in accordance with GAAP in effect on the date such statements were prepared and fairly present the consolidated financial condition and results of operations of the Borrower and its Subsidiaries at such dates and for the periods then ended.  Since December 31, 2001, there has been no Material Adverse Effect.

(b)     Solvency.  On and as of the Third Amended and Restated Effective Date, after giving effect to the Third Amended and Restated Credit Agreement and to all Indebtedness (including the Loans) being incurred, and to be incurred (and the use or proceeds thereof), and Liens created, and to be created, by Borrower in connection with the transactions contemplated hereby, (i) the sum of the assets, at a fair valuation, of Borrower will exceed its Debts; (ii) Borrower has not incurred nor intends to, nor believes that it will, incur Debts beyond its ability to pay such Debts as such Debts mature; and (iii) Borrower will have sufficient capital with which to conduct its business.

(c)     No Undisclosed Liabilities.  Except as fully reflected in the financial statements and the notes thereto referred to in Section 5.7(a) or on Schedule 5.7(c), there are (after giving effect to the Third Amended and Restated Credit Agreement and the other transactions contemplated hereby) no liabilities or obligations with respect to Borrower of any nature whatsoever (whether absolute, accrued, contingent or otherwise and whether or not due) which, either individually or in aggregate, would be material to Borrower.  As of the Third Amended and Restated Effective Date (and after giving effect to the Third Amended and Restated Credit Agreement and the other transaction contemplated hereby), Borrower does not know of any basis for the assertion against Borrower of any liability or obligation of any nature whatsoever that is not reflected in such financial statements or the notes related thereto delivered pursuant to Section 5.7(a) or on Schedule 5.6 which, either individually or in the aggregate, could reasonably be expected to be material to Borrower.

(d)     Projections.  On and as of the Third Amended and Restated Effective Date, the financial projections, attached hereto as Schedule 5.7(d) (the "Projections") have been prepared on a basis consistent with the financial statements referred to in Section 5.7(a) and are based on good faith estimates and assumptions made by the management of Borrower, and there are no statements or conclusions in any of the Projections which are based upon or include information known to Borrower to be misleading or which fail to take into account material information known to Borrower regarding the matters reported therein.  On the Third Amended and Restated Effective Date, Borrower believed that the Projections were reasonable and attainable, it being understood that uncertainty is inherent in any forecasts or projections and that no assurance can be given that the results set forth in the Projections will actually be obtained.

5.8    No Material Litigation.  There are no actions, suits, proceedings or investigations pending or, to the knowledge of Borrower, threatened against Borrower or any of its Subsidiaries or any of its or their respective properties or assets before any arbitrator or Governmental Authority (a) with respect to this Agreement or any other Loan Document or any of the actions contemplated hereby or thereby, or (b) which would reasonably be expected to have a Material Adverse Effect.

5.9    Performance of Agreements.  Neither Borrower nor any of its Subsidiaries is in default in the performance, observance or fulfillment of any of the obligations, covenants or conditions contained in any Contractual Obligation of Borrower or any of its Subsidiaries and no event or condition has occurred or become known or exists which with notice or the lapse of time or both would constitute such a default except where such default or defaults, if any, would not reasonably be expected to have a Material Adverse Effect.

5.10   Taxes.  Borrower and each of its Subsidiaries has filed or caused to be filed all material tax returns and reports which are required to be filed, and has paid all taxes shown to be due and payable on said returns or on any assessments made against it or any of its properties or assets and all other taxes, fees and other charges imposed on its or any of their respective properties by any Governmental Authority other than those the amount or validity of which are currently being contested in good faith by appropriate proceedings diligently pursued and with respect to which reserves in conformity with GAAP have been provided on the books of Borrower and/or its Subsidiaries, as applicable) and no material tax Lien has been filed or received.  There is no proposed tax assessment against Borrower or any of its Subsidiaries which would reasonably be expected to have a Material Adverse Effect.

5.11   Governmental Regulation.  (i)  Neither Borrower nor any of its Subsidiaries is an "investment company" or a company "controlled" by a company required to be registered as an "investment company" within the meaning of the Investment Company Act of 1940, as amended, and (ii) neither Borrower nor any of its Subsidiaries is engaged directly or indirectly, principally, or as one of its important activities, in the business of extending, or arranging for the extension of, credit for the purposes of purchasing or carrying any margin stock, within the meaning of Regulation T, U or X of the Board.

5.12   Ownership of Property; Liens.  Each of Borrower and its Subsidiaries has good and indefeasible title in fee simple to, or a valid leasehold interest in, all its material real property, and good title to, or a valid leasehold interest in, all its other material property, and none of such property is subject to any Lien except for Permitted Liens.

5.13   Intellectual Property.  Borrower and each of its Subsidiaries owns, or is licensed to use, all trademarks, tradenames, copyrights, technology, know-how, patents and processes necessary for the conduct of its business as currently conducted, except for those the failure to own or be licensed to use, which would not reasonably be expected to have a Material Adverse Effect (the "Intellectual Property").  No claim has been asserted and is pending by any Person challenging or questioning the use of any such Intellectual Property or the validity or effectiveness of any such Intellectual Property, nor does Borrower know of any valid basis for any such claim except for such claims and infringements that, in the aggregate, would not reasonably be expected to have a Material Adverse Effect.  To Borrower's or any of its Subsidiaries' knowledge, the use of such Intellectual Property by Borrower and its Subsidiaries does not infringe on the rights of any Person, in each case except for such claims and infringements that, in the aggregate, would not reasonably be expected to have a Material Adverse Effect.

5.14   Disclosure.  This Agreement and any other document, certificate or statement furnished to Agent or any Lender by or on behalf of Borrower or any of its Subsidiaries, taken as a whole, do not contain any untrue statement of a material fact and do not omit to state a material fact necessary in order to make the statements contained herein and therein not misleading when made.  There is no fact known to Borrower or any of its Subsidiaries which now has or in the future would reasonably be expected to have (so far as Borrower or any of its Subsidiaries can now reasonably foresee) a Material Adverse Effect which has not been disclosed in this Agreement, or in the other documents and certificates furnished to Agent and each Lender specifically for use in connection with the transactions contemplated hereby.

5.15   ERISA.  Borrower and each of its ERISA Affiliates are in compliance in all material respects with applicable provisions of ERISA and the Code and the regulations and published interpretations thereunder with respect to all Plans and, to the best of Borrower's knowledge, all Multiemployer Plans, except where noncompliance would not reasonably be expected to have a Material Adverse Effect.  No Termination Event has occurred or is reasonably expected to occur with respect to any Plan.  The sum of the "amounts of unfunded benefit commitments" (as defined in Section 4001(a)(18) of ERISA) under all Plans (excluding each Plan with an amount of unfunded benefit commitments of zero or less) is not more than $7,500,000.  The aggregate Withdrawal Liability under all Multiemployer Plans is not more than $7,500,000.

5.16   Labor Relations.  Except to the extent that such practices, circumstances, events or questions would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, (a) neither Borrower nor any of its Subsidiaries is engaged in any unfair labor practice and (b) no significant strike, labor dispute, slowdown or stoppage is pending against Borrower or any of its Subsidiaries or, to the best knowledge of Borrower, threatened against Borrower or any of its Subsidiaries.

5.17   Insurance.  Except as otherwise permitted by Section 7.8, the properties of Borrower and its Subsidiaries are insured with financially sound and reputable insurance companies, in such amounts, with such deductibles and covering such risks as are customarily carried by Persons engaged in the same or similar businesses.

5.18   Public Utility Holding Company Act.  Neither Borrower nor any of its Subsidiaries is a "holding company," or a "subsidiary company" of a "holding company," or an "affiliate" of a "holding company" or of a "subsidiary company" of a "holding company," within the meaning of the Public Utility Holding Company Act of 1935, as amended.

5.19   Security Documents.  

(a)     Security Agreement Collateral.  The provisions of each Security Agreement  are effective to create in favor of Collateral Agent for the benefit of the Secured Creditors a legal, valid and enforceable security interest in all right, title and interest of the relevant Credit Party in the Collateral, and each Security Agreement, together with the timely filings of Form UCC-1 creates a fully perfected first lien on, and security interest in, all right, title and interest of the relevant Credit Party in all of the Collateral described therein, subject to no other Liens other than Permitted Liens.  Each Credit Party has good and marketable title to, or rights in, all Collateral, free and clear of all Liens except Permitted Liens.

(b)     Real Estate Collateral.  (i) The Ramsey Mortgage executed on the Restatement Date creates, as security for the obligations purported to be secured thereby, a valid and enforceable perfected security interest in and Lien on the Mortgaged Property thereunder for the benefit of the Secured Creditors, superior to and prior to the rights of all third Persons (except that the security interest created in the Mortgaged Property thereunder may be subject to the Permitted Liens related thereto and any Liens referred to in the Ramsey Mortgage Policy) and subject to no other Liens (other than Permitted Real Property Encumbrances and any Liens referred to in the Ramsey Mortgage Policy).

(ii) The Cortland Mortgage creates, as security for the obligations purported to be secured thereby, a valid and enforceable perfected security interest in and Lien on the Mortgaged Property thereunder for the benefit of the Secured Creditors, superior to and prior to the rights of all third Persons (except that the security interest created in the Mortgaged Property thereunder may be subject to the Permitted Liens related thereto and any Liens referred to in the Cortland Mortgage Policy) and subject to no other Liens (other than Permitted Real Property Encumbrances and any Liens referred to in the Cortland Mortgage Policy).  

5.20   Matters Pertaining to Second Amendment and Restatement Agreement.  

(a)     Representations and Warranties.  Each of the representations and warranties given by Borrower in the Agreement are true and correct in all material respects as of the Restatement Date, except to the extent such representations and warranties are expressly made as of a specified date in which event such representations and warranties shall be true and correct as of such specified date.

(b)     Corporate Power; Authorization; No Violation.  The execution, delivery and performance by each Credit Party of the Second Amendment and Restatement Agreement and the other Loan Documents to which it is a party (i) are within such Credit Party's corporate power, (ii) have been duly authorized by all necessary corporate, shareholder and other action on the part of each Person whose authorization is required, (iii) do not violate any Requirement of Law or any material Contractual Obligation applicable to such Credit Party, (iv) will not result in or require the creation or imposition of any Lien of any nature upon or with respect to any of the properties now owned or hereafter acquired by such Person (other than any permitted by the Loan Documents) and (v) will not require any authorization or approval or other action by, or notice to or filing or registration with, any Governmental Authority (other than those which have been obtained and are in force and effect).

5.21   Matters Pertaining to Third Amended and Restated Credit Agreement.  

(a)     Representations and Warranties.  Each of the representations and warranties given by Borrower in the Agreement are true and correct in all material respects as of the Third Amended and Restated Effective Date, except to the extent such representations and warranties are expressly made as of a specified date in which event such representations and warranties shall be true and correct in all material respects as of such specified date.

(b)     Corporate Power; Authorization; No Violation.  The execution, delivery and performance by each Credit Party of the Third Amended and Restated Credit Agreement and the other Loan Documents to which it is a party (i) are within such Credit Party's corporate power, (ii) have been duly authorized by all necessary corporate, shareholder and other action on the part of each Person whose authorization is required, (iii) do not violate any Requirement of Law or any material Contractual Obligation applicable to such Credit Party, (iv) will not result in or require the creation or imposition of any Lien of any nature upon or with respect to any of the properties now owned or hereafter acquired by such Person (other than any permitted by the Loan Documents) and (v) will not require any authorization or approval or other action by, or notice to or filing or registration with, any Governmental Authority (other than those which have been obtained and are in force and effect).

5.22   Deposit Accounts.  Schedule 5.22 lists all banks and other financial institutions at which any Credit Party maintains deposits and/or other accounts as of the Third Amended and Restated Effective Date and such Schedule correctly identifies the name, city and state of each depository, the name in which the account is held and the complete account number.

ARTICLE VI
CONDITIONS OF CREDIT

6.1    Conditions Precedent to Effectiveness.  The parties acknowledge and agree that the Second Amendment and Restatement Agreement became effective upon the satisfaction or waiver of each of the following conditions:

(a)     Loan Documents.  Agent shall have received each of:

(i)                  the Second Amendment and Restatement Agreement, executed and delivered by a duly authorized officer of Borrower, the Agent and the Required Lenders;

(ii)                for the account of each Lender requesting the same, Notes conforming to the requirements hereof and executed by a duly authorized officer of Borrower;

(iii)               a Security Agreement executed and delivered by a duly authorized officer of Borrower and each Subsidiary Guarantor substantially in the form of Exhibit 6.1(a)(iii) hereto (as amended, restated, supplemented or otherwise modified from time to time, in the case of the Borrower the "Original Borrower Security Agreement" and in the case of the Subsidiary Guarantors the "Original Subsidiary Guarantor Security Agreement" collectively with the Borrower Security Agreement, the "Original Security Agreements") together with:

(a)     proper financing statements (Form UCC-1 or such other financial statements or similar notices as shall be required by local law) duly prepared for filing under the UCC or other appropriate filing offices of each jurisdiction as may be necessary or, in the opinion of Agent, desirable to perfect the security interests purported to be created by the Original Security Agreements;

 (b)    evidence of the completion of all other recordings and filings of, or with respect to, the Security Agreements and all other actions as may be necessary or, in the opinion of Agent, desirable to perfect the security interests intended to be created by the Original Security Agreements;

 (c)    evidence that all other actions necessary, or in the reasonable opinion of Agent, desirable to perfect the security interests purported to be granted by the Original Security Agreements have been taken;

(iv)    the Amended and Restated Pledge Agreement executed and delivered by a duly authorized officer of Borrower substantially in the form of Exhibit 6.1(a)(iv) hereto (as amended, restated, supplemented or otherwise modified from time to time, the "Pledge Agreement") and all the Pledged Securities referred to therein then owned, if any, by such Credit Party, (x) endorsed in blank in the case of promissory notes constituting Pledged Securities and (y) together with executed and undated stock powers, in the case of capital stock constituting Pledged Securities, or other transfer assignment instruments in form and substance satisfactory to Agent, in the case of membership interests constituting Pledged Securities and (z) the Pledge Agreement and such other documents shall be in full force and effect, and each Credit Party which is a limited liability company shall have certificated all existing membership interests and delivered to Agent, as pledgee, such pledged certificates as Pledged Securities;

(v)     the Amended and Restated Guaranty executed and delivered by a duly authorized officer of each Subsidiary Guarantor substantially in the form of Exhibit 6.1(a)(v) (as amended, restated, supplemented or otherwise modified from time to time, the "Subsidiary Guaranty"); and

(vi)    the Ramsey Mortgage in the form of Exhibit 6.1(a)(vi)(i), executed by Borrower's Subsidiary, Vision Ease Lens, Inc., with respect to such Subsidiary's real property in the city of Ramsey, Minnesota together with a "marked up" Ramsey Mortgage Title Insurance Commitment in the form attached hereto as Exhibit 6.1(a)(vi)(ii).

(b)     Corporate Proceedings.  Agent shall have received (i) a copy of the resolutions, in form and substance satisfactory to Agent, of the board of directors of Borrower authorizing (x) the execution, delivery and performance of the Second Amendment and Restatement Agreement, the Notes and the other Loan Documents to which it is a party and (y) the borrowings and other extensions of credit contemplated hereunder, certified by the Secretary or an Assistant Secretary of Borrower as of the Restatement Date, which certificate shall state that the resolutions thereby certified have not been amended, revoked, or rescinded and shall be in form and substance satisfactory to Agent, (ii) a copy of the resolutions, in form and substance satisfactory to Agent, of the board of directors of each Subsidiary Guarantor authorizing (x) the execution, delivery and performance of each Loan Document to which it is a party, certified by the Secretary or an Assistant Secretary of each such Subsidiary Guarantor as of the Restatement Date, which certificate shall state that the resolutions thereby certified have not been amended, revoked, or rescinded and shall be in form and substance satisfactory to Agent and (iii) copies of all documents and papers, including records of corporate proceedings, governmental approvals, good standing certificates, and bring down telegrams, if any, which Agent reasonably may have requested in connection therewith, such documents and papers where appropriate to be certified by proper corporate or governmental authorities.

(c)     Corporate Documents.  Agent shall have received, with a counterpart for each Lender, true and complete copies of the certificate of incorporation and by-laws of Borrower and each Subsidiary, certified as of the Restatement Date as complete and correct copies thereof by the Secretary or an Assistant Secretary of such Person or a certificate of the Secretary or an Assistance Secretary of such Person certifying that there has been no change to such Certificate of Incorporation and By-laws since the Restatement Date.

(d)     Incumbency Certificate.  Agent shall have received a certificate of the Secretary or an Assistant Secretary of each Credit Party, dated the Restatement Date, as to the incumbency and signature of the officers of such Person executing the Loan Documents to which it is a party and any certificate or other documents to be delivered by it pursuant thereto.

(e)     Fees and Amendment Fee.  Agent and the Documentation Agent shall have received, for their own accounts and/or the accounts of Lenders, (i) all accrued fees and expenses due and owing hereunder or in connection herewith to Lenders and Agents and (ii) an amendment fee in the amount of .125% of the sum of the Commitments and Converted Term Loan Amounts of each Lender (after giving effect to the Second Amendment and Restatement Agreement) that executes the Second Amendment and Restatement Agreement on or before 5:00 p.m. central time, October 12, 2001.

(f)     Legal Opinions.  Agent shall have received, with a counterpart for each Lender, the executed legal opinion of each of Faegre & Benson, counsel to the Credit Parties, substantially in the form of Exhibit 6.1(f)(i) and of the general counsel of Borrower substantially in the form of Exhibit 6.1(f)(ii).  Such legal opinions shall cover such other matters incident to the transactions contemplated by the Second Amendment and Restatement Agreement as Agent may reasonably require and such counsel delivering the foregoing legal opinion is expressly instructed to deliver its opinion for the benefit of each of Agent and the Lenders.

(g)     Approvals.  All necessary governmental (domestic and foreign) and third party approvals in connection with the Transaction and otherwise referred to herein or therein shall have been obtained and remain in effect, and all applicable waiting periods shall have expired without any action being taken by any competent authority which restrains, prevents or imposes materially adverse conditions upon the consummation of all or any part of the Transaction or the other transactions contemplated by the Loan Documents and otherwise referred to herein or therein.  Additionally, there shall not exist any judgment, order, injunction or other restraint issued or filed or a hearing seeking injunctive relief or other restraint pending or notified prohibiting or imposing materially adverse conditions upon all or any part of the Transaction, the transactions contemplated by the Documents or the making of the Loans or the issuance of the Letters of Credit.

(h)     Litigation.  No litigation by any entity (private or governmental) shall be pending or, to the best knowledge of Borrower, threatened with respect to the Second Amendment and Restatement Agreement, any of the Loan Documents or any documentation executed in connection herewith or the transactions contemplated hereby (including, without limitation, the Transaction), or the obligations being refinanced in connection with the consummation of the Transaction or which Agents or the Required Lenders shall determine could reasonably be expected to have a Material Adverse Effect.

(i)     Officer's Certificate.  Agents shall have received a certificate executed by a responsible officer on behalf of Borrower, dated the Restatement Date and in the form of Exhibit 6.1(i) hereto, stating that the representations and warranties set forth in Article V hereof are true and correct as of the date of the certificate, that no Event of Default or Unmatured Event of Default has occurred and is continuing and that the conditions of Section 6.1 hereof have been fully satisfied (except that no opinion need be expressed as to the Agent's or Required Lenders' satisfaction with any document, instrument or other matter).

(j)     Adverse Change.  On or prior to the Restatement Date, nothing shall have occurred (and none of the Agents nor any Lender shall have become aware of any facts or conditions not previously known) which Agents or the Required Lenders shall determine has or reasonably could be expected to have, or could have a Material Adverse Effect.

6.2    Conditions Precedent to Effectiveness.  The Third Amended and Restated Credit Agreement shall become effective upon the satisfaction of each of the following conditions:

(a)     Loan Documents.  Agent shall have received each of:

(i)     the Third Amended and Restated Credit Agreement, executed and delivered by a duly authorized officer of Borrower, the Agent and the Lenders;

(ii)     for the account of each Lender requesting the same, Notes conforming to the requirements hereof and executed by a duly authorized officer of Borrower;

(iii)    an Amended and Restated Security Agreement executed and delivered by a duly authorized officer of Borrower and each Subsidiary Guarantor substantially in the form of Exhibit 6.2(a)(iii) hereto (as amended, restated, supplemented or otherwise modified from time to time, in the case of the Borrower the "Borrower Security Agreement" and in the case of the Subsidiary Guarantors the "Subsidiary Guarantor Security Agreement" collectively with the Borrower Security Agreement, the "Security Agreements") and in each case along with Annex H and Annex I thereto executed and delivered by a duly authorized officer of each Person party thereto, together with:

(a)     proper amendments to the UCC-1 financing statements (Form UCC-3 or such other financial statements or similar notices as shall be required by local law) duly prepared for filing under the UCC or other appropriate filing offices of each jurisdiction as may be necessary or, in the opinion of Agent, desirable to perfect the security interests purported to be created by the Security Agreements;

 (b)    evidence of the completion of all other recordings and filings of, or with respect to, the Security Agreements and all other actions as may be necessary or, in the reasonable opinion of Agent, desirable to perfect the security interests intended to be created by the Security Agreements;

 (c)    evidence that all other actions necessary, or in the reasonable opinion of Agent, desirable to perfect the security interests purported to be granted by the Security Agreement have been taken;

(iv)    any additional Pledged Securities required to be delivered pursuant to the Pledge Agreement, if any, by any Credit Party, (x) endorsed in blank in the case of promissory notes constituting Pledged Securities and (y) together with executed and undated stock powers, in the case of capital stock constituting Pledged Securities, or other transfer assignment instruments in form and substance satisfactory to Agent, in the case of membership interests constituting Pledged Securities and (z) the Pledge Agreement and such other documents shall be in full force and effect, and each Credit Party which is a limited liability company shall have certificated all existing membership interests and delivered to Agent, as pledgee, such pledged certificates as Pledged Securities;

(v)     the Reaffirmation of Guaranty executed and delivered by a duly authorized officer of each Subsidiary Guarantor substantially in the form of Exhibit 6.2(a)(v) (as amended, restated, supplemented or otherwise modified from time to time, the "Reaffirmation of  Guaranty"); and

(vi)    the Cortland Mortgage in the form of Exhibit 6.2(a)(vi)(i), executed by Borrower together with a "marked up" Cortland Mortgage Title Insurance Commitment in the form attached hereto as Exhibit 6.2(a)(vi)(ii).

(b)     Corporate Proceedings.  Agent shall have received (i) a copy of the resolutions, in form and substance satisfactory to Agent, of the board of directors of Borrower authorizing (x) the execution, delivery and performance of the Third Amended and Restated Credit Agreement, the Notes and the other Loan Documents to which it is a party and (y) the borrowings and other extensions of credit contemplated hereunder, certified by the Secretary or an Assistant Secretary of Borrower as of the Third Amended and Restated Effective Date, which certificate shall state that the resolutions thereby certified have not been amended, revoked, or rescinded and shall be in form and substance satisfactory to Agent, (ii) a copy of the resolutions, in form and substance satisfactory to Agent, of the board of directors of each Subsidiary Guarantor authorizing (x) the execution, delivery and performance of each Loan Document to which it is a party, certified by the Secretary or an Assistant Secretary of each such Subsidiary Guarantor as of the Third Amended and Restated Effective Date, which certificate shall state that the resolutions thereby certified have not been amended, revoked, or rescinded and shall be in form and substance satisfactory to Agent and (iii) copies of all documents and papers, including records of corporate proceedings, governmental approvals, good standing certificates, and bring down telegrams, if any, which Agent reasonably may have requested in connection therewith, such documents and papers where appropriate to be certified by proper corporate or governmental authorities.

(c)     Corporate Documents.  Agent shall have received, with a counterpart for each Lender, true and complete copies of the certificate of incorporation and by-laws of Borrower and each Subsidiary Guarantor, certified as of the Third Amended and Restated Effective Date as complete and correct copies thereof by the Secretary or an Assistant Secretary of such Person or a certificate of the Secretary or an Assistance Secretary of such Person certifying that there has been no change to such Certificate of Incorporation and By-laws since the Third Amended and Restated Effective Date.

(d)     Incumbency Certificate.  Agent shall have received a certificate of the Secretary or an Assistant Secretary of each Credit Party, dated the Third Amended and Restated Effective Date, as to the incumbency and signature of the officers of such Person executing the Loan Documents to which it is a party and any certificate or other documents to be delivered by it pursuant thereto.

(e)     Fees and Amendment Fee.  Agent and the Documentation Agent shall have received, for their own accounts and/or the accounts of Lenders, (i) all accrued fees and expenses due and owing hereunder or in connection herewith to Lenders and Agents and (ii) an amendment fee in the amount of .500% of the sum of the Commitments and Term Loans of each Lender (after giving effect to the Third Amended and Restated Credit Agreement) that executes the Third Amended and Restated Credit Agreement on or before 5:00 p.m. central time, September 27, 2002.

(f)     Legal Opinions.  Agent shall have received, with a counterpart for each Lender, the executed legal opinions of (i) the general counsel of Borrower, substantially in the form of Exhibit 6.2(f)(i); (ii) Faegre & Benson LLP, counsel to the Credit Parties, substantially in the form of Exhibit 6.2(f)(ii); and (iii) Bond, Schoenock & King LLP, counsel to the Credit Parties substantially in the form of Exhibit 6.2(f)(iii)  Such legal opinions shall cover such other matters incident to the transactions contemplated by the Third Amended and Restated Credit Agreement as Agent may reasonably require and such counsel delivering the foregoing legal opinion is expressly instructed to deliver its opinion for the benefit of each of Agent and the Lenders.

(g)     Approvals.  All necessary governmental (domestic and foreign) and third party approvals in connection with the Third Amended and Restated Credit Agreement and otherwise referred to herein or therein shall have been obtained and remain in effect, and all applicable waiting periods shall have expired without any action being taken by any competent authority which restrains, prevents or imposes materially adverse conditions upon the consummation of all or any part of the Third Amended and Restated Credit Agreement or the other transactions contemplated by the Loan Documents and otherwise referred to herein or therein.  Additionally, there shall not exist any judgment, order, injunction or other restraint issued or filed or a hearing seeking injunctive relief or other restraint pending or notified prohibiting or imposing materially adverse conditions upon all or any part of the Third Amended and Restated Credit Agreement, the transactions contemplated by the Documents or the making of the Loans or the issuance of the Letters of Credit.

(h)     Litigation.  No litigation by any entity (private or governmental) shall be pending or, to the best knowledge of Borrower, threatened with respect to the Third Amended and Restated Credit Agreement, any of the Loan Documents or any documentation executed in connection herewith or the transactions contemplated hereby (including, without limitation, the Third Amended and Restated Credit Agreement), or the obligations being refinanced in connection with the consummation of the Third Amended and Restated Credit Agreement or which Agents or the Required Lenders shall determine could reasonably be expected to have a Material Adverse Effect.

(i)     Officer's Certificate.  Agents shall have received a certificate executed by a responsible officer on behalf of Borrower, dated the Third Amended and Restated Effective Date and in the form of Exhibit 6.2(i) hereto, stating that the representations and warranties set forth in Article V hereof are true and correct as of the date of the certificate, that no Event of Default or Unmatured Event of Default has occurred and is continuing and that the conditions of Section 6.2 hereof have been fully satisfied (except that no opinion need be expressed as to the Agent's or Required Lenders' satisfaction with any document, instrument or other matter).

(j)     Adverse Change.  On or prior to the Third Amended and Restated Effective Date, nothing shall have occurred (and none of the Agents nor any Lender shall have become aware of any facts or conditions not previously known) which Agents or the Required Lenders shall determine has or reasonably could be expected to have, or could have a Material Adverse Effect.

 (k)    Cortland Appraisal.  On or prior to the Third Amended and Restated Effective Date, the Agents and the Lenders shall have received an appraisal of the Cortland, New York property owned by the Borrower in form and substance satisfactory to the Agent and the Required Lenders.

(l)     Ramsey Mortgage Amendment.  Agent shall have received an amendment to the Ramsey Mortgage executed and delivered by a duly authorized officer of Borrower in form and substance satisfactory to the Agent.

(m)    Borrowing Base Certificate.  Agent shall have received a Borrowing Base Certificate executed by the Treasurer or Chief Financial Officer of Borrower, dated the Third Amended and Restated Effective Date in the form of Exhibit 7.2(h) hereto.

6.3    Certain Conditions Precedent to Each Loan or Letter of Credit.  The agreement of each Lender to make a Loan (including, without limitation, its initial Loans hereunder, but other than any Revolving Loan the proceeds of which are to be used exclusively to repay Refunded Swing Line Loans) and the obligation of any Facing Agent to issue or any Lender to participate in any Letter of Credit is subject to the satisfaction of the following conditions precedent:

(a)     Representations and Warranties.  All representations and warranties of Borrower and each other Credit Party contained herein and in the other Loan Documents shall be true and correct in all material respects with the same effect as though such representations and warranties had been made on and as of the date of the making of such Loan or Letter of Credit;

(b)     No Events of Default.  There shall exist no Event of Default or Unmatured Event of Default;

(c)     Available Revolving Commitment.  After giving effect to the Loans and Letters of Credit requested to be made, no Lender will have an Available Revolving Commitment which is less than zero; and

(d)     Other Matters.  Agent shall have received such other documents as required by this Agreement in connection with such Loan, all in form and substance as required by this Agreement including, with respect to Revolving Loans, a request for a Borrowing in accordance with the provisions of Section 2.5 hereof; and with respect to the issuance of a Letter of Credit, Agent and the respective facing Agent shall have received a Letter of Credit Request meeting the requirements of Section 2.9(b).

Each request for a Borrowing and the acceptance by Borrower of the proceeds thereof shall constitute a representation and warranty by Borrower, as of the date of the Loans comprising such Borrowing, that the conditions specified in Section 6.3(a), (b) and (c) have been satisfied.

ARTICLE VII
AFFIRMATIVE COVENANTS

Borrower hereby agrees that, so long as any Commitment remains in effect, or any Loan or LC Obligation remains outstanding and unpaid or any other amount is owing to any Lender or any Agent hereunder, Borrower shall:

7.1    Financial Statements.  Furnish to each Lender:

(a)     as soon as available, but in any event within 90 days after the end of each fiscal year of Borrower, a copy of the consolidated and consolidating (by business unit) balance sheet of Borrower and its consolidated Subsidiaries as at the end of such year and the related consolidated and consolidating (by business unit) statements of income, retained earnings and of cash flows for such year, setting forth in each case in comparative form the figures for the previous year; and

(b)     as soon as available, but in any event not later than 45 days after the end of each of the quarterly periods of each fiscal year of Borrower, the unaudited consolidated and consolidating (by business unit) balance sheet of Borrower and its consolidated Subsidiaries as at the end of such quarter and the related unaudited consolidated and consolidating (by business unit) statements of income, retained earnings and of cash flows of Borrower and its consolidated Subsidiaries for such quarter and the portion of the fiscal year through the end of such quarter, setting forth in each case in comparative form the figures for the previous year (except with respect to balance sheet figures which shall be in comparative form for the previous audited period only);

(c)     as soon as available, but in any event within 30 days after the end of each fiscal month of Borrower other than the last such month of any fiscal quarter of Borrower, the consolidated and business segment statements of operations for such month in form reasonably satisfactory to Agent;

all such financial statements shall be complete and correct in all material respects and shall be prepared in accordance with GAAP applied consistently throughout the periods reflected therein and with prior periods (except as approved by the accountants preparing such statements or Financial Officer, as the case may be, and disclosed therein) and, in the case of the consolidated financial statements referred to in Section 7.1(a), accompanied by a report thereon of independent certified public accountants of recognized national standing, which report shall contain no qualifications with respect to the continuance of Borrower and its Subsidiaries as going concerns and shall include a statement to the effect that such financial statements present fairly in all material respects the consolidated financial position of Borrower and its Subsidiaries as at the dates indicated and the consolidated results of their operations and cash flow for the periods indicated in conformity with GAAP and that the examination by such accountants in connection with such financial statements has been made in accordance with generally accepted auditing standards.

7.2    Certificates; Other Information.  Furnish to each Lender (or, if specified below, to Agent):

(a)     Accountant's Certificates.  Concurrently with the delivery of the financial statements referred to in Section 7.1(a), (i) to the extent not contrary to the then current recommendations of the American Institute of Certified Public Accountants, a certificate from Ernst & Young L.L.P. or other independent certified public accountants of nationally recognized standing, stating that, in the course of their annual audit of the books and records of Borrower, no Event of Default or Unmatured Event of Default has come to their attention which was continuing at the end of such fiscal year or on the date of their certificate, or if such an Event of Default or Unmatured Event of Default has come to their attention, the certificate shall indicate the nature of such Event of Default or Unmatured Event of Default and the action which Borrower proposes to take with respect thereto, and (ii) a letter, in form reasonably satisfactory to Agent from such accountants with respect to reliance on such accountant's certificate and report on the annual consolidated financial statements referred to in this Section;

(b)     Officer's Certificate.  Concurrently with the delivery of the financial statements referred to in Sections 7.1(a), 7.1(b) and 7.1(c), a certificate of a Financial Officer substantially in the form of Exhibit 7.2(b) stating that, to the best of such Financial Officer's knowledge, (i) such financial statements present fairly, in accordance with GAAP, the financial condition and results of operations of Borrower and its Subsidiaries for the period referred to therein (subject, in the case of interim statements, to normal recurring adjustments) and  (ii) that no Event of Default or Unmatured Event of Default has occurred, in each case except as specified in such certificates, which shall set forth detailed computations to the extent necessary to establish whether Borrower is in compliance with the covenants set forth in Section 8.1 of this Agreement;

(c)     Budgets; Projections.  As soon as available and in any event within sixty (60) days following the first day of each fiscal year of Borrower (i) an annual budget in form substantially similar to the Projections (including budgeted statements of operations, income, cash flows, retained earnings and shareholders' equity and balance sheets) prepared by Borrower for each fiscal quarter of such fiscal year and (ii) projections in form substantially similar to the Projections covering the period from such fiscal year through the Termination Date, in each case prepared in reasonable detail, with appropriate presentation and discussion of the principal assumptions upon which such budgets and projections are based, which shall be accompanied by the statement of the chief executive officer or Chief Financial Officer of Borrower to the effect that, to the best of his knowledge, such budget and projections are a reasonable estimate for the periods respectively covered thereby;

(d)     Audit Reports and Statements.  Promptly following Borrower's receipt thereof, copies of all consolidated financial or other consolidated reports or statements, if any, submitted to Borrower or any of its Subsidiaries by independent public accountants relating to any annual or interim audit of the books of Borrower or any of its Subsidiaries;

(e)     Public Filings.  Within 20 days after the same become public, copies of all financial statements, filings, registrations and reports which Borrower may make to, or file with, the United States Securities and Exchange Commission or any successor or analogous U.S. Governmental Authority;

(f)     Status.  Within five Business Days after the occurrence thereof, written notice to Agent of any change in the Most Recent Ratio of Consolidated Debt to Consolidated EBITDA which results in a change in the Applicable Margin or the Applicable Commitment Fee, provided, however, that the failure to provide such notice shall not delay or otherwise affect any change in the Applicable Margin or other amount payable hereunder which is to occur upon such a change pursuant to the terms of this Agreement; and

(g)    Other Requested Information  Such other information respecting the respective properties, business affairs, financial condition and/or operations of Borrower or any of its Subsidiaries as Agent or any Lender may from time to time reasonably request.

(h)     Borrowing Base Certificate.  As soon as available, but not later than 30 days after the end of each month, a borrowing base certificate in the form of Exhibit 7.2(h) (each, a "Borrowing Base Certificate") executed by the Treasurer or Chief Financial Officer of the Borrower, with respect to the Eligible Receivables and Eligible Inventory of the Borrower and its Subsidiaries as of the last day of the immediately preceding month.

7.3    Notices.  Promptly upon obtaining knowledge thereof, give notice to Agent (which shall promptly provide a copy of such notice to each Lender) of:

(a)     Event of Default or Unmatured Event of Default.  The occurrence of any Event of Default or Unmatured Event of Default, accompanied by a statement of a Financial Officer setting forth details of the occurrence referred to therein and stating what action Borrower proposes to take with respect thereto.

(b)     Litigation and Related Matters.  The commencement of, or any material development in any action, suit, proceeding or investigation pending or threatened against or affecting Borrower or any of its Subsidiaries or any of their respective properties before any arbitrator or Governmental Authority, in which the amount involved that Borrower reasonably determines is not covered by insurance is $7,500,000 or more, or which, if determined adversely to Borrower or any of its Subsidiaries, would reasonably be expected to have a Material Adverse Effect.

(c)     Notice of Change of Control.  Each occasion that there shall occur a Change of Control, and such notice shall set forth in reasonable detail the particulars of each such occasion.

7.4    Conduct of Business and Maintenance of Existence.  Continue to engage in business of the same general type as now conducted by it and preserve, renew and keep in full force and effect its and each Subsidiary's corporate existence (except for any Subsidiary merged or otherwise consolidated with or into Borrower or another Subsidiary) and take all reasonable action to maintain all rights, privileges and franchises material to its and those of each of its Subsidiaries' businesses except as otherwise permitted pursuant to Sections 8.4 and 8.7 and comply and cause each of its Subsidiaries to comply with all Contractual Obligations and Requirements of Law except to the extent that failure to comply therewith would not in the aggregate reasonably be expected to have a Material Adverse Effect.

7.5    Payment of Obligations.  Pay or discharge or otherwise satisfy at maturity or, to the extent permitted hereby, prior to maturity or before they become delinquent, as the case may be, and cause each of its Subsidiaries to pay or discharge or otherwise satisfy at or before maturity or before they become delinquent, as the case may be:

(i)     all its and their respective Indebtedness;

(ii)     all taxes, assessments and governmental charges or levies imposed upon any of them or upon any of their income or profits or any of their respective properties or assets prior to the date on which penalties attach thereto; and

(iii)    all lawful claims prior to the time they become a Lien (other than Permitted Liens) upon any of their respective properties or assets;

provided, however, that neither Borrower nor any of its Subsidiaries shall be required to pay or discharge any such Indebtedness, tax, assessment, charge, levy or claim while the same is being contested by it in good faith and by appropriate proceedings diligently pursued so long as Borrower or such Subsidiary, as the case may be, shall have set aside on its books adequate reserves in accordance with GAAP (segregated to the extent required by GAAP) with respect thereto and title to any material properties or assets is not jeopardized in any material respect.

7.6    Inspection of Property, Books and Records.  Keep, or cause to be kept, and cause each of its Subsidiaries to keep or cause to be kept, adequate records and books of account, in which complete entries are to be made reflecting its and their business and financial transactions, such entries to be made in accordance with sound accounting principles consistently applied and will permit, and cause each of its Subsidiaries to permit, any Lender or its respective representatives, at any reasonable time, and from time to time at the reasonable request of such Lender made to Borrower and upon reasonable notice, to visit and inspect its and their respective properties, to examine and make copies of and take abstracts from its and their records and books of account, and to discuss its and their respective affairs, finances and accounts with its and their principal officers, directors and independent public accountants (and by this provision Borrower authorizes such accountants to discuss with the Lenders and such representatives the affairs, finances and accounts of Borrower and its Subsidiaries; provided, however, that prior to the occurrence and continuance of an Event of Default, all such discussions shall take place in the presence of a Financial Officer of Borrower).

7.7    ERISA.  (i)  As soon as practicable and in any event within thirty days after Borrower or any of its Subsidiaries or ERISA Affiliates knows or has reason to know that a Reportable Event has occurred with respect to any Plan which would have a Material Adverse Effect, deliver, or cause such Subsidiary or ERISA Affiliate to deliver, to Agent a certificate of a responsible officer of Borrower or such Subsidiary or ERISA Affiliate, as the case may be, setting forth the details of such Reportable Event and the action, if any, which Borrower or such Subsidiary or ERISA Affiliate is required or proposes to take, together with any notices required or proposed to be given; (ii) upon the request of any Lender made from time to time, deliver, or cause each Subsidiary or ERISA Affiliate to deliver, to each Lender a copy of the most recent actuarial report completed and annual report filed with respect to any Plan; (iii) as soon as possible and in any event within ten (10) days after Borrower or any of its Subsidiaries or ERISA Affiliates knows or has reason to know that any of the following have occurred or is reasonably likely to occur with respect to any Plan and could reasonably be expected to have a Material Adverse Effect: (A) the Plan Sponsor intends to terminate such Plan, (B) the PBGC has instituted or will institute proceedings under Section 4042 of ERISA to terminate such Plan, (C) that an accumulated funding deficiency (as defined in Section 3.02(a) of ERISA and Section 412(a) of the Code) has been incurred or that on application may be or has been made to the Secretary of the Treasury for a waiver or modification of the minimum funding standard (including any required installment payments) or on extension of any amortization period under Section 412 of the Code, or (D) that Borrower, or any Subsidiary of Borrower or any ERISA Affiliate will or is reasonably likely to incur any liability (including, but not limited to, contingent or secondary liability) to or on account of the termination of or withdrawal from a Plan under Section 401(a)(29), 4971, 4975 or 4980 of the Code or Section 409 or 502(1) of ERISA, deliver, or cause such Subsidiary or ERISA Affiliate to deliver, to Agent a written notice thereof; and (iv) as soon as possible and in any event within thirty days after Borrower or any of its Subsidiaries or ERISA Affiliates knows or has reason to know that any of them has caused a complete withdrawal or partial withdrawal (within the meaning of Sections 4203 and 4205, respectively, of ERISA) from any Multiemployer Plan and that such withdrawal could reasonably be expected to have a Material Adverse Effect, deliver, or cause such Subsidiary or ERISA Affiliate to deliver, to Agent a written notice thereof.  For purposes of this Section 7.7, Borrower shall be deemed to have knowledge of all facts known by the Plan Administrator of any Plan of which Borrower is the Plan Sponsor, and each Subsidiary and ERISA Affiliate of Borrower shall be deemed to have knowledge of all facts known by the Plan Administrator of any Plan of which such Subsidiary or ERISA Affiliate, respectively, is a Plan Sponsor.  In addition to its other obligations set forth in this Section 7.7, Borrower shall, and shall cause each of its Subsidiaries and ERISA Affiliates to,

(A)    furnish to Agent, promptly after delivery of the same to the PBGC by Borrower or any of its Subsidiaries, a copy of any delinquency notice pursuant to Section 412(n) (4) of the Code,

(B)    correct any such failure to satisfy funding requirements or delinquency referred to in the foregoing clauses (iii)(C) of the first sentence of this Section 7.7 and clause (A) above within ninety (90) days after the occurrence thereof, except where the failure to so satisfy would not reasonably be expected to have a Material Adverse Effect, and

(C)    comply in good faith with the requirements set forth in Section 4980B of the Code and with Sections 601(a) and 606 of ERISA, except where the failure to so comply could not reasonably be expected to have a Material Adverse Effect.

7.8    Insurance.  Borrower shall maintain, and shall cause each of its Subsidiaries to maintain, with financially sound and reputable insurers, insurance with respect to its properties and business against loss or damage of the kinds customarily insured against by Persons engaged in the same or similar business, or such types and in such amounts as are customarily carried under similar circumstances by such other Persons.  Such insurance shall be maintained with financially sound and reputable insurers, except that a portion of such insurance program (not to exceed that which is customary in the case of companies engaged in the same or similar business or having similar properties similarly situated) may be effected through self-insurance, provided adequate reserves therefor, in accordance with GAAP, are maintained.

7.9    Environmental Laws.

(a)     Comply with in all material respects, and cause its Subsidiaries to comply with in all material respects, and, in each case take reasonable steps to ensure compliance in all material respects by all tenants and subtenants, if any, with, all applicable Environmental Laws and obtain and comply in all material respects with and maintain, and take reasonable steps to ensure that all tenants and subtenants obtain and comply in all material respects with and maintain, any and all licenses, approvals, notifications, registrations or permits required by applicable Environmental Laws except to the extent that failure to do so would not reasonably be expected to have a Material Adverse Effect;

(b)     Conduct and complete all investigations, studies, sampling and testing, and all remedial, removal and other actions required under Environmental Laws and promptly comply in all material respects with all lawful orders, directives and information requests of all Governmental Authorities regarding Environmental Laws except to the extent that the same are being contested in good faith by appropriate proceedings and the pendency of such proceedings would not  reasonably be expected to have a Material Adverse Effect; and

(c)     Defend, indemnify and hold harmless Agent and the Lenders, and their respective employees, agents, officers and directors, from and against any and all claims, demands, penalties, fines, liabilities, settlements, damages, costs and expenses of whatever kind or nature known or unknown, contingent or otherwise, arising out of, or in any way relating to the violation of, noncompliance with or liability under, any Environmental Law applicable to the operations of Borrower, any of its Subsidiaries or their respective properties, or any orders, requirements or demands of Governmental Authorities related thereto, including, without limitation, reasonable attorneys' and consultants' fees, investigation and laboratory fees, costs arising from any Remedial Actions, court costs and litigation expenses, except to the extent that any of the foregoing arise out of the gross negligence or willful misconduct of the party seeking indemnification therefor.  The agreements in this clause (c) shall survive repayment of the Notes and all other Obligations.

7.10   Intentionally Omitted.  

7.11   Intentionally Omitted.

7.12   Additional Security; Further Assurances.  

(a)     Additional Subsidiary Guarantors.  Borrower agrees to cause each new Domestic Subsidiary established or created in accordance with Sections 8.4 and 8.8 (a "New Domestic Subsidiary") to execute and deliver the Subsidiary Guaranty or such other guaranty of all Obligations and all obligations under Interest Rate Protection Agreements entered into with a Lender or any Affiliate thereof in form and substance reasonably satisfactory to Agent.

(b)     Pledge of New Subsidiary Stock.  Borrower agrees to pledge, or to cause its Subsidiaries to pledge, (i) all of the Capital Stock of each New Domestic Subsidiary and (ii) 65% of all Capital Stock of each new Foreign Subsidiary owned directly by Borrower or any Domestic Subsidiary established or created to Collateral Agent for the benefit of the Secured Creditors pursuant to the Pledge Agreement.

(c)     Grant of Security by New Domestic Subsidiaries.  Borrower will cause each New Domestic Subsidiary which is required to execute and deliver the Subsidiary Guarantee Agreement pursuant to Section 7.12(a) to grant to Collateral Agent a first priority Lien (subject to Permitted Liens) on all property (tangible and intangible) of such Subsidiary that would have constituted Collateral on the Third Amended and Restated Effective Date upon terms substantially similar to those set forth in the Security Documents as appropriate, and reasonably satisfactory in form and substance to Agent.  Borrower shall cause each Subsidiary, at its own expense, to execute, acknowledge and deliver, or cause the execution, acknowledgment and delivery of, any document or instrument necessary or desirable for the creation and perfection of the foregoing Liens.  Borrower will cause each of its newly established Subsidiaries to take all actions requested by Agent (including, without limitation, the filing of UCC-1's) in connection with the granting and perfecting of such security interests.

(d)     Documentation for Additional Security.  The security interests required to be granted pursuant to this Section 7.12 shall be granted pursuant to such security documentation (which shall  be substantially similar to the Security Documents already executed and delivered by the Credit Parties on the Third Amended and Restated Effective Date) reasonably satisfactory in form and substance to Agent and shall constitute valid and enforceable perfected security interests prior to the rights of all third Persons (subject to Permitted Liens) and subject to no other Liens except Permitted Liens or, in the case of Mortgages, Permitted Real Property Encumbrances.  The Additional Security Documents and other instruments related thereto shall be duly recorded or filed in such manner and in such places and at such times as are required by law to establish, perfect, preserve and protect the Liens, in favor of Collateral Agent for the benefit of the Secured Creditors, required to be granted pursuant to the Additional Security Document and, all taxes, fees and other charges payable in connection therewith shall be paid in full by Borrower.  At the time of the execution and delivery of the Additional Security Documents, Borrower shall cause to be delivered to the Collateral Agent such agreements, certificates, opinions of counsel, Mortgage Policies, title surveys, real estate appraisals  and other related documents as may be reasonably requested by Agent to assure Agent that this Section 7.12 has been complied with.

(e)     Foreign Subsidiaries Security.  If following a change in applicable law, including the relevant sections of the Code or the regulations promulgated thereunder, counsel for Borrower reasonably acceptable to Agent does not within 45 days after a request from Agent or the Lenders deliver evidence, in form and substance reasonably satisfactory to Agent, with respect to any Foreign Subsidiary which has not already had all of its stock pledged pursuant to the Pledge Agreement that a pledge of 66-2/3% or more of the total combined voting power of all classes of capital stock of such Foreign Subsidiary entitled to vote would cause the undistributed earnings of such Foreign Subsidiary as determined for Federal income tax purposes to be treated as a deemed dividend to such Foreign Subsidiary's United States parent for Federal income tax purposes, then that portion of such Foreign Subsidiary's outstanding capital stock not theretofore pledged pursuant to the Pledge Agreement shall be pledge to the Collateral Agent for the benefit of the Secured Creditors pursuant to the Pledge Agreement (or another pledge agreement in substantially similar form, if needed), to the extent that entering into such Pledge Agreement is permitted by the laws of the respective foreign jurisdiction and with all documents delivered pursuant to this Section 7.12 to be in form and substance reasonably satisfactory to Agent.

(f)     Agreement to Grant Additional Security.  Promptly, and in any event within 30 days after the acquisition by Borrower or any Subsidiary of assets or real or personal property or leasehold interests of the type that would have constituted Collateral on the Third Amended and Restated Effective Date and investments of the type that would have constituted Collateral on the Third Amended and Restated Effective Date (the "Additional Collateral"), Borrower will notify the Agent of such new Collateral and will execute all filing of appropriate financing statements under the provisions of the UCC, applicable foreign, domestic or local laws, rules or regulations in each of the offices where such filing is, except with respect to Foreign Subsidiaries as otherwise set forth herein, necessary or appropriate and (ii) will with respect to real estate, execute a mortgage, obtain Mortgage Policies, title surveys, Landlord Consents and real estate appraisals satisfying all Requirements of Law, to grant Collateral Agent a perfected Lien in such Collateral (or comparable interest under foreign law in the case of foreign Collateral) pursuant to and to the full extent required by the Security Documents and this Agreement; provided, however, that Borrower shall not be required to notify the Agent for any Additional Collateral in the event Lenders' security interest therein has already been perfected.

7.13  Pledge of BV1.   Borrower shall, as soon as practicable, but in any event not later than January 31, 2000 (subject to extension in the reasonable discretion of the Agent), pledge 65% of the issued and outstanding Capital Stock of Buckbee-Mears Holding Company B.V., to the Collateral Agent for the benefit of the Secured Creditors pursuant to documentation reasonably satisfactory to the Agent, including, without limitation, an opinion of counsel (if requested by Agent).

7.14  Third Party Consultant.     Upon the occurrence of any Event of Default, or in the event that as of the last day of any fiscal quarter, the Consolidated EBITDA of the Borrower and its Subsidiaries is less than $26 million for the period of four consecutive fiscal quarters ending on such last day as determined in conjunction with the calculation of the Leverage Ratio pursuant to Section 8.1(b), the Agent shall be entitled to retain an independent third party consultant to assist it in evaluating the reasonableness of Borrower's financial forecast, the fees and expenses of such third party consultant to be paid by Borrower.  

7.15   Field Audit.  Within sixty (60) days following the Third Amended and Restated Effective Date, the Borrower shall deliver to Agent and the Lenders a report of the field examination of the Accounts Receivable and Inventory of Borrower and its Subsidiaries (the "Field Audit") which shall be in a form reasonably satisfactory to Agent.

7.16   Operating Accounts and Deposit Accounts.  Borrower shall, at all times, and shall cause each Credit Party to, at all times, maintain all of its Operating Accounts and Deposit Accounts with a Lender or Lenders; provided, however, that nothing in this Section 7.16 shall be construed to require Borrower or any Credit Party to maintain its Deposit Accounts and Operating Accounts with any Lender on terms that are not commercially reasonable nor shall anything in this Section 7.16 be construed to require any Lender to offer any such services to Borrower or any Credit Party; provided, further, in the event Borrower or any Credit Party is unable to obtain Deposit Accounts and Operating Accounts with any of the Lenders on a commercially reasonable basis, Borrower and the Credit Parties may maintain such Deposit Accounts and Operating Accounts with a financial institution(s) that is not a Lender provided that such financial institution(s) provide the Agent a written acknowledgement in form and substance reasonably satisfactory to Agent acknowledging the Lenders' Lien in the Collateral held in such Deposit Accounts and Operating Accounts and agreeing, upon the occurrence and continuance of an Event of Default, to take any such action with respect to the Collateral as directed by the Agent consistent with the terms of this Agreement and the Loan Documents.

7.17   Field Exam Upon Event of Default.  Upon the occurrence of any Event of Default, at the request of the Agent and the Supermajority Lenders of the Revolving Loan Facility, the Term A Facility and the Term B Facility, the Borrower shall retain a third party consultant to undertake a field examination of the Accounts Receivable and Inventory of Borrower and its Subsidiaries a report of which field examination shall be delivered to the Lenders and Agent within forty-five (45) days following any such request.   

ARTICLE VIII
NEGATIVE COVENANTS

Borrower hereby agrees that, so long as the Revolving Commitments remain in effect or any Obligation is owing to any Lender or any Agent hereunder, Borrower shall not, nor shall it permit any of its Subsidiaries to, directly or indirectly:

8.1    Financial Condition Covenants.

(a)     Maintenance of Consolidated Net Worth.  Permit Consolidated Net Worth on the last day of any fiscal quarter to be less than the sum of (i)  $150,000,000 plus (ii) the amount equal to 50% of the aggregate Consolidated Net Income of Borrower and its consolidated Subsidiaries since December 31, 1997; provided, however, that in the event that Borrower and its consolidated Subsidiaries have a consolidated net loss for any fiscal quarter, Consolidated Net Income for purposes only of clause (ii) of this Section 8.1(a) shall be deemed to be zero for such fiscal quarter plus (iii) 75% of the Net Offering Proceeds from the issuance of Capital Stock.

(b)     Leverage Ratio.  Permit the ratio of (a) Consolidated Debt on the last day of any fiscal quarter of Borrower (after giving effect to all payments and prepayments made on or prior to such last day) to (b) Consolidated EBITDA for the period of four consecutive fiscal quarters ending on such last day to be greater than the respective ratio set forth below opposite such fiscal quarter:

Fiscal Quarter Ending	Ratio
September 30, 2002	4.40:1.0
December 31, 2002	4.25:1.0
March 31, 2003	4.25:1.0
June 30, 2003	3.50:1.0
September 30, 2003	3.25:1.0
December 31, 2003	3.00:1.0
March  31, 2004	3.00:1.0

(c)     Interest Coverage Ratio.  Permit the ratio of (a) Consolidated EBITDA for the period of four consecutive fiscal quarters ending on the last day of any fiscal quarter of Borrower to (b) Consolidated Interest Expense for such period to be less than the respective ratio set forth below opposite such fiscal quarter:

Fiscal Quarter Ending	Ratio
September 30, 2002 through March 31, 2003	2.00:1.0
June 30, 2003	2.25:1.0
September 30, 2003 through December 31, 2003	2.50:1.0
March 31, 2004	2.75:1.0

(d)     Capital Expenditures. (i) Borrower will not, and will not permit any of its Subsidiaries to, make any Capital Expenditures, except that during any fiscal year Borrower and its Subsidiaries may make Capital Expenditures so long as the aggregate amount so made by Borrower and its Subsidiaries (on a consolidated basis) during such fiscal year does not exceed $15,000,000.

 (ii)    Notwithstanding the foregoing, Borrower and its Subsidiaries may make Capital Expenditures (which Capital Expenditures will not be included in any determination under the foregoing clause (i)) with the insurance proceeds received by Borrower or any of its Subsidiaries from any Recovery Event so long as such Capital Expenditures are to replace or restore any properties or assets in respect to which such proceeds are received.

8.2    Indebtedness.  Incur, directly or indirectly, or suffer to exist any Indebtedness except:

(a)     Indebtedness incurred pursuant to this Agreement and the other Loan Documents;

(b)     Intercompany Indebtedness to the extent such Indebtedness constitutes a Permitted Investment; provided, however, that in the event of any subsequent issuance or transfer of any Capital Stock which results in the holder of such Indebtedness ceasing to be a Credit Party of Borrower or any subsequent transfer of such Indebtedness (other than to Borrower or any other Credit Party) such Indebtedness shall be required to be permitted under another clause of this Section 8.2; provided, further, however, that in the case of Intercompany Indebtedness consisting of a loan or advance to Borrower, each such loan or advance shall be subordinated to the indefeasible payment in full of all of Borrower's obligations pursuant to this Agreement and the other Loan Documents, and each such loan or advance shall be on open account and shall not be evidenced by a promissory note or other instrument;

(c)     Indebtedness outstanding on the Closing Date and listed on Schedule 8.2(c) hereto, provided that the Indebtedness under Existing Credit Agreements have been paid in full with the proceeds of the Initial Loans under the Original Agreement;

(d)     Indebtedness under Interest Rate Protection Agreements entered into to protect Borrower or any of its Subsidiaries against fluctuations in interest rates in respect of the Obligations;

(e)     Indebtedness under Currency Protection Agreements so long as management of Borrower or such Subsidiary, as the case may be, has determined that entering into of such Currency Protection Agreements are bona fide hedging activities;

(f)     Permitted Subordinated Indebtedness;

(g)     Permitted IDB/Community Development Indebtedness; and

(h)     other Indebtedness in addition to that described in clauses (a) through (g) of this Section 8.2; provided, however, that the aggregate principal amount of the Indebtedness permitted under this Section 8.2(i), when added to all Permitted IDB/Community Development Indebtedness then outstanding does not exceed $5,000,000.

8.3    Liens. Create, incur, assume or suffer to exist or agree to create, incur or assume any Lien (except for Permitted Liens) in, upon or with respect to any of its properties or assets (including, without limitation, any securities or debt instruments of any of its Subsidiaries), whether now owned or hereafter acquired, or assign or otherwise convey any right to receive income to secure any obligation.

8.4    Fundamental Changes.  Enter into any merger, consolidation or amalgamation, or liquidate, wind-up or dissolve itself (or suffer any liquidation or dissolution); make any Material Asset Disposition; make any Acquisition; or make any material change in its present method of conducting business; provided, however, that as long as immediately after giving effect to such transaction, the resulting, surviving or transferee Person shall have Consolidated Net Worth in an amount which is not less than the Consolidated Net Worth of such Person prior to such transaction:

(a)     any Subsidiary of Borrower may be merged or consolidated with or into Borrower (provided, however, that Borrower shall be the continuing or surviving corporation) or with or into any one or more Wholly-Owned Subsidiaries of Borrower (provided, however, that (i) at least one Wholly-Owned Subsidiary shall be the continuing or surviving corporation and (ii) in the case of any merger or consolidation between Subsidiaries at least one of that is a Subsidiary Guarantor, a Subsidiary Guarantor shall be the surviving Person);

(b)     any Wholly-Owned Subsidiary may sell, lease, transfer or otherwise dispose of any or all of its assets (upon voluntary liquidation or otherwise) to Borrower or any other Wholly-Owned Subsidiary of Borrower (and may thereafter be dissolved);

(c)     Borrower may make any Permitted Acquisition (which may be effected through a merger of a Subsidiary with or into an acquired Person); and

(d)     Borrower may carry out the European Reorganization, may continue its departure from the computer-monitor apperture business, may complete the sale and transfer of its operations in Saint Paul, Minnesota, and may close its operations in Azusa, California (including the exercise by Vision-Ease Lens Azusa, Inc. of its option to purchase certain real estate under its current leases and to sell such real estate).

8.5    Restricted Payments.  Either:  (i) declare or pay any dividend or make any distribution on or in respect of its Capital Stock or to the direct or indirect holders of its Capital Stock (except dividends or distributions payable solely in its Non-Convertible Capital Stock or in options, warrants or other rights to purchase its Non-Convertible Capital Stock and except dividends or distributions payable to Borrower or a Subsidiary of Borrower) or (ii) purchase, redeem or otherwise acquire or retire for value any Capital Stock of Borrower (any such dividend, distribution, purchase, redemption, repurchase, defeasance, other acquisition, retirement or Investment being hereinafter referred to as a "Restricted Payment"); provided, however, that during such time as no Event of Default or Unmatured Event of Default has occurred and is continuing or would result therefrom, Borrower or any Wholly-Owned Subsidiary of Borrower may make Restricted Payments in any fiscal year of Borrower consisting of repurchases of Capital Stock of Borrower in an aggregate amount not to exceed $1,000,000.

8.6    Distributions from Subsidiaries.  Create or otherwise cause or permit to exist or become effective any consensual encumbrance or restriction on the ability of any Subsidiary of Borrower to (i) pay dividends or make any other distributions on its Capital Stock or pay any Indebtedness or other obligation owed to Borrower or any of its other Subsidiaries, (ii) make any loans or advances to Borrower or any of its other Subsidiaries, or (iii) transfer any of its property or assets to Borrower or any of its other Subsidiaries, except:

(a)     any encumbrance or restriction pursuant to an agreement in effect at or entered into on the Closing Date and reflected on Schedule 8.6(a) hereto;

(b)     any encumbrance or restriction with respect to a Subsidiary of Borrower pursuant to an agreement relating to any Indebtedness issued by such Subsidiary on or prior to the date on which such Subsidiary became a Subsidiary of Borrower or was acquired by Borrower (other than Indebtedness issued as consideration in, or to provide all or any portion of the funds utilized to consummate, the transaction or series of related transactions in contemplation of or pursuant to which such Subsidiary became a Subsidiary or was acquired by Borrower) and outstanding on such date;

(c)     any such encumbrance or restriction consisting of customary non-assignment provisions in leases or other contracts governing leasehold interests or other contract rights to the extent such provisions restrict the transfer of the lease, contract or rights; and

(d)     in the case of clause (iii) above, restrictions contained in security agreements securing Indebtedness of a Subsidiary of Borrower to the extent such restrictions restrict the transfer of the property subject to such security agreements.

8.7    Sales of Assets and Subsidiary Stock.  Convey, sell, lease or otherwise dispose of (or agree to do any of the foregoing without the Agent's prior written consent) all or any part of the property or assets of a Subsidiary of Borrower with a value in excess of $1,000,000 unless Borrower or such Subsidiary receives consideration at the time of such disposition at least equal to the fair market value, as determined in good faith by the board of directors of such Person (including a determination as to the value of all noncash consideration), of the shares and assets subject to such disposition.  The Net Sale Proceeds of any disposition shall be applied in the manner set forth in Section 4.3.

8.8    Investments.  Make any Investments except for Permitted Investments.

8.9    Transactions with Affiliates.  Conduct any business or enter into any transaction or series of similar transactions (including the purchase, sale, lease or exchange of any property or the rendering of any service) with any Affiliate of Borrower or any legal or beneficial owner of 5% or more of any class of Capital Stock of Borrower or with any Affiliate of such owner (other than a Wholly-Owned Subsidiary of Borrower or an employee stock ownership plan for the benefit of Borrower's or any of its Subsidiaries' employees) unless the terms of such business, transaction or series of transactions are (i) as favorable to Borrower or such Subsidiary as terms that would be obtainable at the time for a comparable transaction or series of similar transactions in arm's‑length dealings with an unrelated third person or, if such transaction is not one which by its nature could be obtained from such person, is on fair and reasonable terms and (ii) are in the ordinary course of business or, if not in the ordinary course of business, are set forth in writing and the board of directors of Borrower or such Subsidiary, as the case may be, has determined in good faith that such business or transaction or series of transactions meets the applicable criteria set forth in clause (i) above.

8.10   Sale-Leasebacks.  Lease any property as lessee in connection with a Sale and Leaseback Transaction entered into after the Closing Date if, at the time of such entering into and after giving effect thereto, Attributable Debt for such Sale and Leaseback Transaction and for all Sale and Leaseback Transactions so entered into by Borrower and its Subsidiaries from and after the Closing Date shall exceed $5,000,000.

8.11   Fiscal Year.  Change the fiscal year of Borrower.

8.12   Amendments to Organizational Documents.  Amend, modify or waive, or permit any amendment, modification or waiver as to any material provision of its articles of incorporation, by-laws or other similar governing documents if such amendment, modification or waiver would adversely affect the interests of Agent or the Lenders.

8.13   Accounting Changes.  Make or permit to be made any change in accounting policies affecting the presentation of financial statements or reporting practices from those employed by it on the date hereof, unless (i) such change is required by GAAP, (ii) such change is disclosed to the Lenders through Agent or otherwise and (iii) relevant prior financial statements that are affected by such change are restated (in form and detail reasonably satisfactory to Agent) as may be required by GAAP to show comparative results.

8.14   Lines of Business.  Enter into or acquire any line of business which is not reasonably related to the business engaged in as of the date hereof.

8.15   Limitation on Voluntary Payments.  Make any voluntary prepayment of, or redeem, repurchase or defease, any Indebtedness except (i) prepayments of the Obligations and (ii) mandatory prepayments required pursuant to the instrument evidencing such Indebtedness or pursuant to which any such Indebtedness was issued.

ARTICLE IX
EVENTS OF DEFAULT

9.1    Events of Default.  If any of the events, acts, conditions or occurrences (each, an "Event of Default") hereinafter set forth shall occur or exist (for any reason whatsoever, and whether such happening shall be voluntary or involuntary or come about or be effected by operation of law or pursuant to or in accordance with any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body):

(a)     Failure to Make Payments When Due.  (i) Borrower shall default in the payment when due of principal on any Loan in accordance with the terms hereof or any reimbursement obligation with respect to any Letter of Credit; or (ii) Borrower shall default in the payment when due of interest on any Loan in accordance with the terms hereof and such default shall continue for five (5) days after the date when due; or (iii) Borrower shall default in the payment when due of any other amount owing hereunder or any other Loan Document and such default shall continue for ten (10) days after the date when due; or

(b)     Representations.  Any representation or warranty made or deemed to be made by Borrower or any Credit Party herein or in any document, instrument or certificate delivered by a Credit Party pursuant hereto shall prove to have been incorrect or misleading in any material respect on or as of the date made or deemed made; or

(c)     Breach of Certain Covenants.  Borrower shall fail to perform or comply with any term or condition contained in Sections 7.1, 7.2, 7.3 or 7.12, Article VIII; or

(d)     Other Defaults Under Agreement or Loan Documents.  Borrower or any of its Subsidiaries shall default in the performance or observance of any term, covenant, condition or agreement contained in this Agreement (other than as provided in clauses (a), (b) or (c) of this Section 9.1), or any other Loan Document and such default shall continue unremedied for a period of 30 days after written notice thereof shall have been given to Borrower by Agent or the Required Lenders; or

(e)     Default Under Other Agreements.  Borrower or any of its Subsidiaries (i) shall default in the payment when due (after giving effect to any applicable grace period), whether at stated maturity or otherwise, of principal or interest in respect of Indebtedness having an aggregate principal amount of $5,000,000 or more; or (ii) shall fail to perform or observe any other condition or covenant, or any other event shall occur or condition exist, under any agreement or instrument relating to any such Indebtedness having an aggregate principal amount of $5,000,000, if the effect of any such failure, event or condition is to cause, or to permit the holder or holders of such Indebtedness or beneficiary or beneficiaries of such Indebtedness (or a trustee or agent on behalf of such holder or holders or beneficiary or beneficiaries) to cause (determined without regard to whether any notice of acceleration or similar notice is required), such Indebtedness to be declared to be due and payable prior to its stated maturity, or cash collateral in respect thereof to be demanded; or

(f)     Judgments.  One or more judgments or decrees shall be entered against Borrower or any of its Subsidiaries involving, individually or in the aggregate, a liability of $7,500,000 or more and all such judgments or decrees shall not have been vacated, discharged or stayed pending appeal within sixty (60) days from the entry thereof but in any event prior to the commencement of enforcement proceedings; or

(g)     Voluntary Insolvency, Etc.  Borrower or any of its Material Subsidiaries shall become insolvent, generally fail to pay, or state in writing or publicly its inability or unwillingness to pay, its debts as they become due or call a meeting of creditors for the purpose of adjusting its debts; or Borrower or any of its Material Subsidiaries shall become insolvent or shall voluntarily commence any proceeding or file any petition under any bankruptcy, insolvency or similar law seeking dissolution or reorganization or the appointment of a receiver, trustee, custodian or liquidator for it or a substantial portion of its property, assets or business, or to effect a plan or other arrangement with its creditors, or shall file any answer admitting the jurisdiction of the court and the material allegations of an involuntary petition filed against it in any bankruptcy, insolvency or similar proceeding, or shall be adjudicated bankrupt, or shall make a general assignment for the benefit of creditors, or shall consent to, or acquiesce in the appointment of, a receiver, trustee, custodian or liquidator for a substantial portion of its property, assets or business; or

(h)     Involuntary Insolvency, Etc.  Involuntary proceedings or an involuntary petition shall be commenced or filed against Borrower or any of its Material Subsidiaries under any bankruptcy, insolvency or similar law or seeking the dissolution or reorganization of it or the appointment of a receiver, trustee, custodian or liquidator for it or of a substantial part of its property, assets or business, or any writ, judgment, warrant of attachment, execution or similar process shall be issued or levied against a substantial part of its property, assets or business, and such proceedings or petition shall not be dismissed, or such writ, judgment, warrant of attachment, execution or similar process shall not be released, vacated or fully bonded, within sixty (60) days after commencement, filing or levy, as the case may be, or any order for relief shall be entered in any such proceeding; or

(i)     Unenforceability.  This Agreement or any other Loan Document shall cease for any reason to be in full force and effect (other than by reason of any action by Agent or any Lender or the satisfaction of all Borrower's or any of its Subsidiaries' obligations thereunder) or Borrower or any of its Subsidiaries or any other Person (other than the Lenders or Agent) shall disavow its obligations under any provision hereof or thereof, or shall deny that it has any or further obligations under any provision thereof, or shall contest the validity or enforceability of any provision thereof; or

(j)     ERISA.

(i)  A Reportable Event or Reportable Events, or a failure to make a required installment or other payment (within the meaning of Section 412(n)(l) of the Code), shall have occurred with respect to any Plan or Plans that would reasonably be expected to result in liability of Borrower to the PBGC or to a Plan in each case in an aggregate amount exceeding $7,500,000 and the Agent shall have notified Borrower in writing that (x) the Required Lenders have made a determination that, on the basis of such Reportable Event or Reportable Events or such failure to make a required payment, there are reasonable grounds (A) for the termination of such Plan or Plans by the PBGC, (B) for the appointment by the appropriate United States District Court of a trustee to administer such Plan or Plans or (C) for the imposition of a lien in favor of a Plan and (y) as a result thereof an Event of Default exists hereunder; or a Termination Event shall have occurred; or

(ii)     The Borrower or any ERISA Affiliate shall have been notified by the sponsor of a Multiemployer Plan that it has incurred Withdrawal Liability to such Multiemployer Plan and the amount of the Withdrawal Liability specified in such notice, when aggregated with all other Withdrawal Liabilities (determined as of the date or dates of such notification), exceeds $7,500,000; or

(iii)    Borrower or any ERISA Affiliate shall have been notified by the sponsor of a Multiemployer Plan that such Multiemployer Plan is in reorganization or is being terminated, within the meaning of Title IV of ERISA, if solely as a result of such reorganization or termination the aggregate annual contributions of Borrower and its ERISA Affiliates to all Multiemployer Plans that are then in reorganization or have been or are being terminated have been or will be increased over the amounts required to be contributed to such Multiemployer Plans for their most recently completed plan years by an amount exceeding $7,500,000; or

(k)     Change of Control.  A Change of Control shall occur; or

(l)     Environmental Default.  The Borrower or any of its Subsidiaries shall be the subject of any proceeding or investigation pertaining to the release by Borrower or any of its Subsidiaries, or any other Person of any toxic or hazardous waste or substance into the environment, or any violation of any Environmental Law, which, in either case, would reasonably be expected to have a Material Adverse Effect; or

(m)    Security Documents.  At any time after the execution and delivery thereof, any of the Security Documents shall cease to be in full force and effect in accordance with the terms thereof or shall cease to give Agent for the benefit of the Lenders the Liens, rights, powers and privileges purported to be created thereby (including, without limitation, a first priority perfected security interest (subject to Permitted Liens) in, and Lien on, all of the Collateral for which Agent or Collateral Agent has taken necessary actions to perfect its security interest), in favor of Agent, superior to and prior to the rights of all third Persons and subject to no other Liens (except to the extent expressly permitted herein or therein); or any Credit Party shall default in the due performance or observance of any term, covenant or agreement on its part to be performed or observed pursuant to any of the Security Documents and such default shall continue beyond any grace period specifically applicable thereto pursuant to the terms of such Security Document.

THEN, and in any such event (except an Event of Default specified in paragraph (g) or (h) of this Section) and at any time thereafter while an Event of Default is continuing, Agent may with the consent of Required Lenders, and at the direction of the Required Lenders shall, take one or more of the following actions: (A) declare the Revolving Commitments terminated, whereupon the Revolving Commitment(s) of each Lender hereunder shall terminate immediately and all fees and other amounts accrued in accordance with this Agreement shall forthwith become due and payable without any other notice of any kind; (B) declare all sums then owing by Borrower hereunder and under the Notes to be forthwith due and payable, whereupon all such sums shall become and be immediately due and payable without presentment, demand, protest or notice of any kind, all of which are hereby expressly waived by Borrower; (C) exercise on behalf of itself and the Lenders all rights and remedies available to it and the Lenders under the Loan Documents or applicable law and (D) terminate any Letter of Credit which may be terminated in accordance with its terms, (iv) direct Borrower to pay (and Borrower agrees that upon receipt of such notice, or upon the occurrence of any Event of Default specified in Section 9.1(g) or Section 9.1(h) with respect to Borrower it will pay) to Agent such additional amount of cash, to be held as security by Agent, as is equal to the aggregate Stated Amount of all Letters of Credit issued for the account of Borrower and its subsidiaries and then outstanding, provided, however, that if an Event of Default specified in paragraph (g) or (h) of this Section shall occur, the result which would occur upon the giving of notice by Agent to Borrower, as specified in clauses (A) or (B) above, shall occur automatically without the giving of any such notice.  Promptly following the making of any such declaration, Agent shall give notice thereof to Borrower and each Lender, but failure to notify any Person shall not impair the effect of such declaration.

9.2    Rescission of Acceleration.  Anything in Section 9.1 to the contrary notwithstanding, Agent shall, at the request of the Required Lenders, rescind and annul any acceleration of the Notes under this Agreement by written instrument filed with Borrower; provided, however, that at the time such acceleration is so rescinded and annulled:

(i)     all past due interest and principal, if any, on the Notes and all other sums payable under this Agreement (except any principal and interest on any Notes which has become due and payable solely by reason of such acceleration) shall have been duly paid, and

(ii)     no other Event of Default or Unmatured Event of Default shall have occurred and be continuing which shall not have been waived in accordance with this Agreement.

9.3    Rights Not Exclusive.  The rights provided for in this Agreement and the other Loan Documents are cumulative and are not exclusive of any other rights, powers, privileges or remedies provided by law or in equity, or under any other instrument, document or agreement now existing or hereafter arising.

ARTICLE X
AGENT

10.1   Appointment and Authorization.  Each Lender hereby irrevocably appoints, designates and authorizes DBTCA as Agent (for purposes of this Article X the term "Agent" shall include DBTCA in its capacity as Collateral Agent pursuant to the Security Documents) and each holder of any Note by the acceptance of such Note shall be deemed irrevocably to have authorized Agent to take such action on its behalf under the provisions of this Agreement and each other Loan Document and to exercise such powers and perform such duties as are expressly delegated to it by the terms of this Agreement or any other Loan Document, together with such powers as are reasonably incidental thereto (including, without limitation, to give notices and take such actions on behalf of the Required Lenders as are consented to in writing by the Required Lenders).  Agent may perform any of its duties hereunder, or under the other Loan Documents, by or through its agents or employees.

10.2   Nature of Duties.  Agent shall have no duties or responsibilities except those expressly set forth in this Agreement.  The duties of Agent shall be mechanical and administrative in nature.  EACH LENDER HEREBY ACKNOWLEDGES AND AGREES THAT AGENT SHALL NOT HAVE, BY REASON OF THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, A FIDUCIARY RELATIONSHIP TO OR IN RESPECT OF ANY LENDER.  Nothing in any of the Loan Documents, expressed or implied, is intended to or shall be so construed as to impose upon Agent any obligations in respect of any of the Loan Documents except as expressly set forth herein or therein.  Each Lender shall make its own independent investigation of the financial condition and affairs of Borrower in connection with the making and the continuance of the Loans hereunder and shall make its own appraisal of the credit worthiness of Borrower, and Agent shall have no duty or responsibility, either initially or on a continuing basis, to provide any lender with any credit or other information with respect thereto, whether coming into its possession before making of the Loans or at any time or times thereafter.  Agent will promptly notify each Lender at any time that the Required Lenders have instructed it to act or refrain from acting pursuant to Article IX.

10.3   Liability of Agent.  Agent, its Affiliates, or any of their respective officers, directors, employees, agents, affiliates or attorneys‑in‑fact (collectively, the "Agent‑Related Persons") shall not (i) be liable to any of the Lenders 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 (except for their own gross negligence or willful misconduct), or (ii) be responsible in any manner to any of the Lenders for any recital, statement, representation or warranty made by Borrower or Affiliate of Borrower, or any officer 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, or the Documentation Agent under or in connection with, this Agreement or any other Loan Document, or the execution, validity, effectiveness, genuineness, enforceability, collectibility or sufficiency of this Agreement or any other Loan Document, or for any failure of Borrower to perform its obligations hereunder or thereunder.  No Agent‑Related Person shall be under any obligation to any Lender to ascertain or to inquire as to the observance or performance of any of the terms or provisions contained in, or conditions of, this Agreement or any other Loan Document, or the financial condition of Borrower, or the existence or possible existence of any Unmatured Event of Default or Event of Default unless requested to do so by the Required Lenders, or to inspect the properties, books or records of Borrower or any of its Subsidiaries or Affiliates.

10.4   Reliance by Agent.

(a)     The Lenders agree that Agent shall be entitled to rely, and shall be fully protected in relying, upon any writing, resolution, notice, consent, certificate, affidavit, letter, telegram, facsimile, 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), independent accountants and other experts selected by Agent.  Agent may at any time request instructions from the Lenders with respect to actions or approvals (including the failure to act or approve) which by the terms of any of the Loan Documents Agent is permitted or required to take or to grant.  The Lenders agree that Agent shall be fully justified in failing or refusing to take any action under this Agreement or any other Loan Document unless it shall first receive such advice or concurrence of the Required Lenders as it deems appropriate and, if it so requests, it shall first be indemnified to its satisfaction by the Lenders against any and all liability and expense which may be incurred by it by reason of taking or continuing to take any such action.  The Lenders agree that 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 or consent and any action taken or failure to act pursuant thereto shall be binding upon all of the Lenders.

(b)     For purposes of determining compliance with the conditions specified in Sections 6.1 and 6.2, each Lender that has executed this Agreement shall be deemed to have consented to, approved or accepted or to be satisfied with each document or other matter required thereunder to be consented to or approved by or acceptable or satisfactory to the Lender, unless an officer of Agent, responsible for the transactions contemplated by the Loan Documents shall have received notice from the Lender prior to the initial Borrowing specifying in reasonable detail its objection thereto and either such objection shall not have been withdrawn by notice to Agent to that effect, or the Lender shall not have made available to Agent the Lender's ratable portion of such Borrowing.

10.5   Notice of Default.  Agent shall not be deemed to have knowledge or notice of the occurrence of any Event of Default or Unmatured Event of Default, except with respect to defaults in the payment of principal, interest and fees required to be paid to Agent for the account of the Lenders, unless Agent shall have received written notice from a Lender or Borrower referring to this Agreement, describing such Event or Default or Unmatured Event of Default and stating that such notice is a "notice of default".  In the event that Agent receives such a notice, Agent shall give notice thereof to the Lenders.  Agent shall take such action with respect to such Event of Default or Unmatured Event of Default as shall be requested by the Required Lenders in accordance with Article IX; provided, however, that unless and until Agent shall have 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 Event of Default or Unmatured Event of Default as it shall deem advisable or in the best interest of the Lenders.

10.6   Credit Decision.  Each Lender expressly acknowledges that none of the Agent‑Related Persons has made any representation or warranty to it and that no act by any Agent, hereinafter taken, including any review of the affairs of Borrower and its Subsidiaries shall be deemed to constitute any representation or warranty by such Agent to any Lender.  Each Lender represents to Agent that it has, independently and without reliance upon Agent and based on such documents and information as it has deemed appropriate, made its own appraisal of and investigation into the business, prospects, operations, property, financial and other condition and creditworthiness of Borrower and its Subsidiaries, and all applicable bank regulatory laws relating to the transactions contemplated thereby, and made its own decision to enter into this Agreement and extend credit to Borrower hereunder.  Each Lender also represents that it will, independently and without reliance upon Agent, 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 its Subsidiaries.  Except for notices, reports and other documents expressly herein required to be furnished to the Lenders by Agent, Agent shall not have any duty or responsibility to provide any Lender with any credit or other information concerning the business, prospects, operations, property, financial and other condition or creditworthiness of Borrower which may come into the possession of any of the Agent‑Related Persons.

10.7   Indemnification.  The Lenders shall indemnify upon demand 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), ratably according to each Lender's Commitment Percentage from and against any and all liabilities, obligations, losses, damages, claims, penalties, actions, judgments, suits, costs, and reasonable expenses and disbursements of any kind whatsoever which may at any time (including at any time following the repayment of the Loans) be imposed on, incurred by or asserted against any such Person any way relating to or arising out of this Agreement or any document contemplated by or referred to herein or therein or the transactions contemplated hereby or thereby or any action taken or omitted by any such Person under or in connection with any of the foregoing; provided, however, that no Lender shall be liable for the payment to the Agent‑Related Persons of any portion of such liabilities, obligations, losses, damages, claims, penalties, actions, judgments, suits, costs, expenses or disbursements resulting from such Person's gross negligence or willful misconduct.  Without limitation of the foregoing, each Lender shall reimburse Agent upon demand for its ratable share of any reasonable costs or out‑of‑pocket expenses (including Attorney Costs) 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, any other Loan Document, or any document contemplated by or referred to herein to the extent that Agent is not reimbursed for such expenses by or on behalf of Borrower.  Without limiting the generality of the foregoing, if the IRS or any authority of the U.S. or other jurisdiction asserts a claim that Agent did not properly withhold tax from amounts paid to or for the account of any Lender (because the appropriate form was not delivered, was not properly executed, or because such Lender failed to notify Agent of a change in circumstances which rendered the exemption from, or reduction of, withholding tax ineffective, or for any other reason) such Lender shall indemnify Agent fully for all amounts paid, directly or indirectly, by Agent as tax or otherwise, including penalties and interest, and including any taxes imposed by any jurisdiction on the amounts payable to Agent under this Section 10.7, together with all Attorney Costs.  The obligation of the Lenders in this Section 10.7 shall survive the payment of all Obligations hereunder and termination of the Agreement.

10.8   Agent in Individual Capacity.  Agent and its Affiliates may make loans to, issue letters of credit for the account of, accept deposits from, acquire equity interests in and generally engage in any kind of banking, trust, financial advisory or other business with Borrower and its Subsidiaries and Affiliates as though Agent were not Agent hereunder and without notice to the Lenders.  With respect to its Loans, Agent shall have the same rights and powers under this Agreement as any other Lender and may exercise the same as though it were not Agent hereunder or under any other Loan Document, including, without limitation, the acceptance of fees or other consideration for services without having to account for the same to any of the Lenders.  The terms "Lender" and "Lenders" shall include DBTCA in its individual capacity.

10.9   Resignation by Agent.

(a)     Agent may resign from the performance of all its functions and duties hereunder at any time by giving fifteen (15) Business Days' prior written notice to Borrower and the Lenders.  Such resignation shall take effect upon the acceptance by a successor Agent of appointment pursuant to clauses (b) and (c) below or as otherwise provided below.

(b)     Upon any such notice of resignation, the Required Lenders shall appoint a successor Agent who shall (unless an Event of Default has occurred and is continuing) be satisfactory to Borrower and shall be an incorporated bank or trust company.

(c)     If a successor Agent shall not have been so appointed within said 15 Business Day period, Agent, with the consent of Borrower, shall then appoint a successor Agent who shall serve as Agent until such time, if any, as the Required Lenders, with the consent of Borrower, appoint a successor Agent as provided above.

(d)     If no successor Agent has been appointed pursuant to clause (b) or (c) by the 20th Business Day after the date such notice of resignation was given by Agent, Agent's resignation shall become effective and the Required Lenders shall thereafter perform all the duties of Agent hereunder until such time, if any, as the Required Lenders, with the consent of Borrower, appoint a successor Agent as provided above.

(e)     Upon the effective date of such resignation, only 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 rights, powers and duties in such capacity shall be terminated.  After any retiring Agent resigns hereunder as Agent the provisions of this Article X and Section 11.4 shall inure to their respective benefit as to any actions taken or omitted to be taken by it while it was Agent under this Agreement; except with respect to indemnification provisions under this Agreement which shall survive as to such resigning Agent.

10.10  Documentation Agent.  The designation of Bank One, NA as Documentation Agent shall not impose upon it any obligation or liability to the Borrower or any Lender.

ARTICLE XI
MISCELLANEOUS

11.1   No Waiver; Modifications in Writing.  

(a) No failure or delay on the part of Agent or any Lender in exercising any right, power or remedy under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any such right, power or remedy preclude any other or further exercise thereof or the exercise of any other right, power or remedy.  The remedies provided for in this Agreement are cumulative and are not exclusive of any remedies that may be available to Agent or any Lender at law or in equity or otherwise.  No amendment, modification, supplement, termination or waiver of or to any provision of this Agreement or any Note, nor consent to any departure by Borrower therefrom, shall be effective unless the same shall be consented to by or on behalf of Borrower and the Required Lenders; provided, however, that the consent of each Lender (other than a Defaulting Lender) affected thereby shall be required to effect any amendment, modification, supplement, termination, waiver or consent, as the case may be (any of the foregoing, a "Modification"), which has the effect of

(i)     reducing the aggregate principal amount of, or interest rate on, any of the Revolving Notes or Term Notes or releasing any Subsidiary Guarantor (other than as a result of a transaction permitted by Section 8.4 or an Asset Disposition made in accordance with the terms of this Agreement) or reducing the aggregate amount of any fees provided for in this Agreement, except that any Modification that has the effect of reducing the aggregate amount of any fees payable to Agent for its own account shall require only the consent of Agent;

(ii)     extending the stated final maturity of any of the Revolving Commitments, Term Loans or the Notes or extending the date of any portion of any payment of principal of, or interest or fees in respect of, any of the Revolving Commitments, Term Loans or Notes (it being understood that modifying or waiving any Event of Default or Unmatured Event of Default (other than an Event of Default described in Section 9.1(a)(i), 9.1(g) or 9.1(h)) or amending the mandatory prepayment provisions or financial covenants shall not constitute an extension of the final stated maturity or extension of the date of any payment of any Commitment,  Loan or Note); or

(iii)    changing this proviso or the first sentence of Section 11.9(a), reducing the percentage specified in the definition of the term "Required Lenders", or (except in connection with a permitted assignment by any Lender under this Agreement) the definition of the terms "Revolving Commitment", "Term Loans" or "Commitment Percentage" (it being understood with respect to all of the foregoing that, with the consent of the Required Lenders, additional extensions of credit pursuant to this Agreement may be included in the determination of the Required Lenders);

(iv)    releasing any of the Pledged Stock (except as expressly provided in the applicable Security Documents) under all of the Security Documents; or

(v)    releasing any of the Collateral (except as expressly provided in Section 11.20(b));

provided, further, that no such amendment, modification, supplement, waiver, discharge, termination or other change shall (1) without the consent of the Majority Lenders of each Facility which is being allocated a lesser prepayment, repayment or commitment reduction, alter the required application of any prepayments or repayments (or commitment reduction), as between the various Facilities (although the Required Lenders may waive in whole or in part, any such prepayment, repayment or commitment reduction so long as the application, as amongst the various Facilities, of any such prepayment, repayment or commitment reduction which is still required to be made is not altered) (it being understood with respect to all of the foregoing that, with the consent of the Required Lenders, the definition of Majority Lenders may be amended to permit additional extensions of credit as otherwise permitted by this Agreement) or (2) amend the definitions of "Borrowing Base", "Eligible Receivables", or "Eligible Inventory" without the consent of the Supermajority Lenders of the Revolving Loan Facility;

provided, further, that the consent of Agent shall be required to effect any Modification that has the effect of (x) increasing the duties or obligations of Agent, (y) increasing the standard of care or performance required on the part of Agent, or (z) reducing or eliminating the indemnities, exculpations or immunities to which Agent is entitled;

Any Modification of or to any provision of this Agreement shall be effective only in the specific instance and for the specific purpose for which made or given and only if in writing.  Except where notice is specifically required by this Agreement, no notice to or demand on Borrower or any other Person in any case shall entitle Borrower or such other Person to any other or further notice or demand in similar or other circumstances.

 (b)  If, in connection with any proposed amendment, change, supplement, waiver, discharge or termination of any of the provisions of this Agreement as contemplated by clauses (a)(i) through (v), inclusive, of the first proviso to the third sentence of Section 11.1(a), the consent of the Required Lenders is obtained but the consent of one or more of such other Lenders whose consent is required is not obtained, then Borrower shall have the right, so long as all non‑consenting Lenders whose individual consent is required are treated as described in either clauses (A) or (B) below, to either (A) replace each such non‑consenting Lender or Lenders (or, at the option of the Borrower if the respective Lender's consent is required with respect to less than all Loans, to replace only the respective Loans of the respective non-consenting Lender which gave rise to the need to obtain such Lender's individual consent) with one or more Replacement Lenders pursuant to Section 3.7 so long as at the time of such replacement, each such Replacement Lender consents to the proposed amendment, modification, supplement, waiver, discharge, termination or other change or (B) terminate such non‑consenting Lender's Revolving Commitment and repay all outstanding Loans of such Lender which gave rise to the need to obtain such Lender's consent, in accordance with Section 4.l(b) and/or 4.2; provided that, unless the Revolving Commitment is terminated and Loans repaid pursuant to the preceding clause (B) are immediately replaced in full at such time through the addition of new Lenders or the increase of the Commitments and/or outstanding Loans of existing Lenders (who in each case must specifically consent thereto), then in the case of any action pursuant to preceding clause (B) the Required Lenders (determined before giving effect to the proposed action) shall specifically consent thereto, provided, further, that in any event Borrower shall not have the right to replace a Lender, terminate its Revolving Commitment or repay its Loans solely as a result of the exercise of such Lender's rights (and the withholding of any required consent by such Lender) contemplated by the second proviso to the third sentence of Section 11.1(a).

11.2   Intentionally omitted.

11.3   Notices, Etc.  Except where telephonic instructions or notices are authorized herein to be given, all notices, demands, instructions and other communications required or permitted to be given to or made upon any party hereto or any other Person shall be in writing and shall be personally delivered or sent by registered or certified mail, postage prepaid, return receipt requested, or by a reputable courier delivery service, or by prepaid telex, TWX or telegram (with messenger delivery specified in the case of a telegram), or by telecopier, and shall be deemed to be given for purposes of this Agreement on the day received if deposited in registered or certified mail, postage prepaid, and otherwise on the day that such writing is delivered or sent to the intended recipient thereof, or in the case of notice delivered by telecopy, upon completion of transmission with a copy of such notice also being delivered under any of the methods provided above, all in accordance with the provisions of this Section provided that any notice, request or demand to or upon any Agent or the Lenders pursuant to Sections 2.1, 2.2, 3.4 or 4.1 shall not be effective until received.  Unless otherwise specified in a notice sent or delivered in accordance with the foregoing provisions of this Section, notices, demands, instructions and other communications in writing shall be given to or made upon the respective parties hereto at their respective addresses (or to their respective telex, TWX or telecopier numbers) indicated on Schedule 11.3 hereto or in any applicable Assignment and Assumption Agreement and, in the case of telephonic instructions or notices, by calling the telephone number or numbers indicated for such party on Schedule 11.3 hereto or in any applicable Assignment and Assumption Agreement (in each case as such may be modified from time to time by notice hereunder).

11.4   Costs, Expenses and Taxes; Indemnity.

(a)     Generally.  Borrower agrees (without duplication) to pay promptly upon written request by Agent, which shall include reasonable detail (i) all reasonable costs and expenses in connection with the negotiation, preparation, printing, typing, reproduction, execution and delivery of this Agreement and the other Loan Documents and the documents and instruments referred to herein and therein and any amendment, waiver, consent relating hereto or thereto or other modifications of (or supplements to) any of the foregoing and any and all other documents and instruments furnished pursuant hereto or thereto or in connection herewith or therewith, including without limitation, the reasonable fees and out-of-pocket expenses of Winston & Strawn, special counsel to Agent, and any local counsel retained by Agent relative thereto, other Attorney Costs, independent public accountants and other outside experts retained by Agent in connection with the administration of this Agreement and the other Loan Documents, and (ii) all reasonable costs and expenses (including, without limitation, Attorney Costs), if any, paid by Agent or any Lender in connection with the enforcement of this Agreement, any of the Loan Documents or any other agreement furnished by Borrower or any of its Subsidiaries pursuant hereto or thereto or in connection herewith or therewith.  In addition, Borrower shall pay any and all present and future stamp, transfer excise and other similar taxes payable or determined to be payable in connection with the execution and delivery of this Agreement, any Loan Document, or the making of any Loan, and each agrees to save and hold Agent and each Lender harmless from and against any and all liabilities with respect to or resulting from any delay by Borrower in paying, or omission by Borrower to pay, such taxes.  Any portion of the foregoing fees,  costs and expenses which remains unpaid more than thirty (30) days following Agent's or any Lender's statement and request for payment thereof shall bear interest from the date of such statement and request to the date of payment at the Default Rate.

(b)     Indemnification.  Borrower will indemnify and hold harmless Agent and each Lender and each director, officer, employee, agent and Affiliate of each Agent and each Lender (collectively, the "Indemnified Persons") from and against all losses, claims, damages, penalties, causes of action, obligations, costs, expenses or liabilities (including, without limitation, Attorney Costs and reasonable expenses, consultant fees and investigation fees) (collectively, "Expenses") to which such Indemnified Person shall become subject, insofar as such Expenses (or actions, suits or proceedings, including, without limitation, any inquiry or investigation or claim in respect thereof, whether or not any Indemnified Person is named as a party) arise out of, in any way relate to, or result from the transactions contemplated by this Agreement and to reimburse each Indemnified Person upon its written demand showing reasonable detail, for any legal or other expenses incurred in connection with investigating, preparing to defend or defending any such loss, claim, damage, liability, action or claim; provided, however, that Borrower shall have no obligation to an Indemnified Person hereunder with respect to indemnified liabilities arising from the gross negligence or willful misconduct of any such Indemnified Person or for any loss, claim, damage, liability, action or claim incurred by such Indemnified Person hereunder resulting solely from the gross negligence or willful misconduct of such Indemnified Person; and provided, further, however, that no Indemnified Person may settle any such action, suit or proceeding without the consent of Borrower which consent shall not be unreasonably withheld or delayed.  If an action, suit or proceeding arising from any of the foregoing is brought against any Indemnified Person, Borrower shall, if requested by such Indemnified Person, resist and defend at its own expense such action, suit or proceeding or cause the same to be resisted and defended by counsel reasonably satisfactory to such Indemnified Person.  Each Indemnified Person shall have the right to employ its own counsel to investigate and control the defense of any matter covered by such indemnity and the reasonable fees and expenses of such counsel shall be at the expense of the indemnifying party, provided, however, that in any one action or separate but similar or related actions in the same jurisdiction arising out of the same general allegations or circumstances, Borrower shall not be liable for fees and expenses of more than one counsel (in addition to any local counsel), which counsel shall be designated by the Agent provided, further, however, each Indemnified Person shall have the right to employ separate counsel in any such inquiry, action, claim or proceeding and to control the defense thereof, and the reasonable fees and expenses of such counsel shall be at the expense of the Borrower if (i) Borrower shall have agreed in writing to pay such fees and expenses or (ii) such Indemnified Person shall have notified Borrower that it has been advised by counsel that there may be one or more legal defenses available to such Indemnified Person that are different from or additional to those available to the other Indemnified Persons and that such common representation would adversely impact the adequacy of the proposed representation.  If Borrower shall fail to do, or cause to be done, any act or thing which it has covenanted to do or cause to be done under this Agreement or any representation or warranty on the part of Borrower contained in any Loan Document shall be breached, Agent may (but shall not be obligated to) do the same or cause it to be done or remedy any such breach, and may expend its own funds for such purpose, and will use its best efforts to give prompt written notice to Borrower that it proposes to take such action; provided, however, that any failure by Agent to do any such act or thing or give any such notice shall not relieve Borrower of any such obligations and shall not impose or result in the imposition of any liability on Agent or any Lender.  Any and all amounts so expended by Agent shall be due and payable by Borrower promptly upon Agent's written demand therefor, together with interest thereon at a rate per annum equal to the Default Rate during the period from and including the date so demanded by Agent to the date of repayment.  To the extent that the undertaking to indemnify, pay or hold harmless Agent or Lender as set forth in this Section 11.4 may be unenforceable because it is violative of any law or public policy, Borrower shall make the maximum contribution to the payment and satisfaction of each of the indemnified liabilities which is permissible under applicable law.

(c)     If any sum due from Borrower under this Agreement or any order or judgment given or made in relation hereto has to be converted from the currency (the "first currency") in which the same is payable hereunder or under such order or judgment into another currency (the "second currency") for the purpose of (i) making or filing a claim or proof against Borrower with any Governmental Authority or in any court or tribunal, or (ii) enforcing any order or judgment given or made in relation hereto, Borrower shall indemnify and hold harmless each of the Persons to whom such sum is due from and against any loss actually suffered as a result of any discrepancy between (a) the rate of exchange used to convert the amount in question from the first currency into the second currency, and (b) the rate or rates of exchange at which such Person, acting in good faith in a commercially reasonable and prompt manner, purchased the first currency with the second currency after receipt of a sum paid to it in the second currency in satisfaction, in whole or in part, of any such order, judgment, claim or proof.  The foregoing indemnity shall constitute a separate obligation of Borrower distinct from its other obligations hereunder and shall survive the giving or making of any judgment or order in relation to all or any of such other obligations.

(d)     The obligations of Borrower under this Section and the other indemnification obligations of the Borrower under this Agreement shall be effective and binding on Borrower irrespective of whether any Loans are made and shall survive (i) the termination of this Agreement and the discharge of Borrower's other obligations hereunder and under the Notes and (ii) the assignment by any Lender of any of its interests herein pursuant to Section 11.9(c) with respect to any acts, omissions and/or events occurring or arising prior to the Effective Date of such assignment.

(e)     Nothing contained in this Section shall be deemed to limit or reduce any indemnity in favor of any Agent or any Lender contained in any other Loan Document or agreement.

11.5   Confirmations.  Each of Borrower and each holder of a Note agrees, from time to time, upon written request received by it from the other, to confirm to the other in writing (with a copy of each such confirmation to Agent) the aggregate unpaid principal amount of the Loans then outstanding under such Note.

11.6   Transfer of Notes.  In the event that the holder of any Note (including any Lender) shall transfer such Note, it shall immediately advise Agent and Borrower of such transfer, and Agent and Borrower shall be entitled conclusively to assume that no transfer of any Note has been made by any holder (including any Lender) unless and until Agent and Borrower shall have received written notice to the contrary.  Each transferee of any Note shall take such Note subject to the provisions of this Agreement and to any Modification or other action taken under this Agreement prior to the receipt by Agent and Borrower of written notice of such transfer by each previous holder of such Note and, except as expressly otherwise provided in such notice, Agent and Borrower shall be entitled conclusively to assume that the transferee named in such notice shall thereafter be vested with all rights and powers under this Agreement with respect to the Loans of the Lender named as the payee of the Note which is the subject of such transfer.

11.7   Adjustments; Setoff.

(a)     If, other than as expressly set forth elsewhere herein, any Lender shall obtain on account of the Committed Loans made by it any payment (whether voluntary, involuntary, through the exercise of any right of setoff, or otherwise) in excess of its Commitment Percentage of payments on account of the Committed Loans obtained by all the Lenders, such Lender shall forthwith (x) notify Agent of such fact, and (y) purchase from the other Lenders such participations in the Committed Loans made by them as shall be necessary to cause such purchasing Lender to share the excess payment ratably with each of them; provided, however, that if all or any portion of such excess payment is thereafter recovered from the purchasing Lender, such purchase shall to that extent be rescinded and each other Lender shall repay to the purchasing Lender the purchase price paid thereto together with an amount equal to such paying Lender's Commitment Percentage (according to the proportion of (i) the amount of such paying Lender's required repayment to (ii) the total amount so recovered from the purchasing Lender, of any interest or other amount paid or payable by the purchasing Lender in respect of the total amount so recovered.  Agent will keep records (which shall be conclusive and binding in the absence of demonstrable error), of participations purchased pursuant to this Section 11.7 and will in each case promptly notify the Lenders and Borrower following any such purchases.  Any payments received after the Lenders have taken action pursuant to this Section 11.7 shall be allocated ratably among the Revolving Loans and the Swing Line Loans of all the Lenders.

(b)     Borrower agrees that any Lender so purchasing a participation from another Lender pursuant to this Section 11.7 may, to the fullest extent permitted by law, exercise all its rights of payment (including the right of setoff, but subject to Section 11.7(d)) with respect to such participation as fully as if such Lender were the direct creditor of Borrower in the amount of such participation.

(c)     Nothing herein shall require any Lender to exercise any right of setoff or similar rights or shall affect the right of any Lender to exercise, and retain the benefits of exercising, any such right with respect to any other Indebtedness or obligation of Borrower.

(d)     In addition to any rights and remedies of the Lenders provided by law, each Lender shall have the right, without prior notice to Borrower or any other Person, any such notice being expressly waived by Borrower, upon the occurrence of an Event of Default to setoff and apply against any Obligations any and all deposits (general or special, time or demand, provisional or final), in any currency, and any other credits, indebtedness or claims, in any currency, in each case whether direct or indirect, absolute or contingent, whether matured or unmatured, of Borrower to such Lender, any amount owing from such Lender or any branch or agency thereof to or for the credit or account of Borrower, at or at any time after, the happening of  any of the above-mentioned events, and the aforesaid right of setoff may be exercised by such Lender against Borrower or against any trustee in bankruptcy, debtor in possession, assignee for the benefit of creditors, receivers, or execution, judgment or attachment creditor of Borrower, or against anyone else claiming through or against, Borrower or such trustee in bankruptcy, debtor in possession, assignee for the benefit of creditors, receivers, or execution, judgment or attachment creditor, notwithstanding the fact that such right of setoff shall not have been exercised by such Lender prior to the making, filing or issuance, or service upon such Lender of, or of notice of, any such petition, assignment for the benefit of creditors, appointment or application for the appointment of a receiver, or issuance of execution, subpoena, order or warrant.  Each Lender agrees promptly to notify Borrower and Agent after any such setoff and application made by such Lender; provided, however, that the failure to give such notice shall not affect the validity of such setoff and application.

(e)     Borrower expressly agrees that to the extent Borrower makes a payment or payments and such payment or payments, or any part thereof, are subsequently invalidated, declared to be fraudulent or preferential, set aside or are required to be repaid to a trustee, receiver, or any other party under any bankruptcy act, state or federal law, common law or equitable cause, then to the extent of such payment or repayment, the Indebtedness to the Lenders or part thereof intended to be satisfied shall be revived and continued in full force and effect as if said payment or payments had not been made.

11.8   Execution in Counterparts.  This Agreement may be executed in any number of counterparts and by the different parties hereto on separate counterparts, each of which counterparts, when so executed and delivered, shall be deemed to be an original and all of which counterparts, taken together, shall constitute but one and the same Agreement and it shall not be necessary in making proof of this Agreement to produce more than one such counterpart or counterparts bearing the signatures of all of the parties thereto.

11.9   Binding Effect; Assignment; Addition and Substitution of Lenders.

(a)     This Agreement shall be binding upon, and inure to the benefit of, Borrower, Agent, the Lenders, all future holders of the Notes and their respective successors and assigns; provided, however, that Borrower may not assign its rights or obligations hereunder or in connection herewith or any interest herein (voluntarily, by operation of law or otherwise) without the prior written consent of Agent and all of the Lenders.

(b)     Each Lender may at any time sell to one or more banks or other entities ("Participants") participating interests in all or any portion of its Revolving Commitment and Loans or participation in Letters of Credit or any other interest of such Lender hereunder (in respect of any Lender, its "Credit Exposure").  In the event of any such sale by a Lender of participating interests to a Participant, such Lender's obligations under this Agreement shall remain unchanged, such Lender shall remain solely responsible for the performance thereof, and Borrower and Agent shall continue to deal solely and directly with such Lender in connection with such Lender's rights and obligations under this Agreement.  Borrower agrees that if amounts outstanding under this Agreement or any of the Loan Documents are due or 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 deemed to have the right of setoff in respect of its participating interest in amounts owing under this Agreement and the Loan Documents to the same extent as if the amount of its participating interest were owing directly to it as a Lender under this Agreement or any other Loan Document, provided, however,  that such right of setoff shall be subject to the obligation of such Participant to share with the Lenders, and the Lenders agree to share with such Participant, as provided in Section 11.7.  Borrower also agrees that each Participant shall be entitled to the benefits of Sections 3.5, 3.6 and 4.6 with respect to its participation in the Loans outstanding from time to time.  Each Lender agrees that any agreement between such Lender and any such Participant in respect of such participating interest shall not restrict such Lender's right to approve or agree to any amendment, change, supplement waiver of, discharge or termination to any of the provisions of this Agreement or any of the Loan Documents except to the extent that any of the forgoing would (i) extend the final scheduled maturity of any Loan or Note in which such Participant is participating beyond the Termination Date, or reduce the rate or extend the time of payment of interest or fees on any such Loan or Note (except in connection with a waiver of applicability of any post‑default increase in interest rates) or reduce the principal amount thereof, or increase the amount of the participant's participation over the amount thereof then in effect (it being understood that waivers or modifications of conditions precedent, covenants, Events of Default or Unmatured Events of Default or of a mandatory reduction in Commitments shall not constitute a change in the terms of such participation, and that an increase in any Revolving Commitment or Loan shall be permitted without the consent of any Participant if the Participant's participation is not increased as a result thereof), (ii) consent to the assignment or transfer by Borrower of any of its rights and obligations under this Agreement or (iii) release all or substantially all of the Collateral under all of the Security Documents (except as expressly provided in the Loan Documents) supporting the Loans and/or Letters of Credit hereunder in which such Participant is participating.

(c)     Any Lender may at any time assign to one or more Eligible Assignees, including an Affiliate thereof (each an "Assignee"), all or any part of its Credit Exposure pursuant to an Assignment and Assumption Agreement, provided that (i) it assigns its Credit Exposure in an amount not less than $5,000,000 (or if less the entire amount of Lender's Credit Exposure) and (ii) any assignment of all or any portion of any Lender's Credit Exposure to an Assignee other than another Lender shall require the prior written consent of Agent and, so long as no Unmatured Event of Default or Event of Default has occurred and is continuing, Borrower (the consent of Borrower and Agent not to be unreasonably withheld or delayed), and provided further, that notwithstanding the foregoing limitations, any Lender may at any time assign all or any part of its Credit Exposure to any Affiliate of such Lender or to any other Lender.  Upon execution of an Assignment and Assumption Agreement and the payment of a nonrefundable assignment fee of $3,500 in immediately available funds to Agent at its Payment Office in connection with each such assignment, written notice thereof by such transferor Lender to Agent and the recording by Agent of such assignment and the resulting effect upon the Loans and Revolving Commitment of the assigning Lender and the Assignee, the Assignee shall have, to the extent of such assignment, the same rights and benefits as it would have if it were a Lender hereunder and the holder of the Obligations (provided that Borrower and Agent shall be entitled to continue to deal solely and directly with the assignor Lender in connection with the interests so assigned to the Assignee until written notice of such assignment, together with payment instructions, addresses and related information with respect to the Assignee, shall have been given to Borrower and Agent by the assignor Lender and the Assignee) and, if the Assignee has expressly assumed, for the benefit of Borrower, some or all of the transferor Lender's obligations hereunder, such transferor Lender shall be relieved of its obligations hereunder to the extent of such assignment and assumption, and except as described above, no further consent or action by Borrower, the Lenders or Agent shall be required.  At the time of each assignment pursuant to this Section 11.9(c) to a Person which is not already a Lender hereunder and which is not a United States person (as such term is defined in Section 7701(a)(30) of the Code) United States Federal income tax purposes, the respective Assignee shall provide to Borrower and Agent the appropriate IRS Forms (and, if applicable a Section 4.6(d)(ii) Certificate) described in Section 4.6(d).  Each Assignee shall take such Credit Exposure subject to the provisions of this Agreement and to any request made, waiver or consent given or other action taken hereunder, prior to the receipt by Agent and Borrower of written notice of such transfer, by each previous holder of such Credit Exposure.  Such Assignment and Assumption Agreement shall be deemed to amend this Agreement and Schedule 2.1(a)(ii) and 2.1(b) hereto, to  the extent, and only to the extent, necessary to reflect the addition of such Assignee as a Lender and the resulting adjustment of all or a portion of the rights and obligations of such transferor Lender under this Agreement, the Revolving Commitment, the determination of its Commitment Percentage (rounded to twelve decimal places), the Loans and any new Notes to be issued, at Borrower's expense, to  such Assignee, and no further consent or action by Borrower or the Lenders shall be required to effect such amendments.

(d)     Borrower authorizes each Lender to disclose to any Participant or Assignee (each, a "Transferee") and any prospective Transferee any and all financial information in such Lender's possession concerning Borrower and any Subsidiary of Borrower which has been delivered to such Lender by Borrower pursuant to this Agreement or which has been delivered to such Lender by Borrower in connection with such Lender's credit evaluation of Borrower prior to entering into this Agreement; provided that such Transferee or prospective Transferee agrees in writing to treat any such information which is not public as confidential.

(e)     Notwithstanding any other provision set forth in this Agreement, any Lender may at any time pledge or assign all or any portion of its rights under this Agreement and the other Loan Documents (including, without limitation, the Notes held by it) to any Federal Reserve Bank in accordance with Regulation A of the Federal Reserve Board without notice to, or the consent of, Borrower.  No such pledge or assignment shall release the transferor Lender from its obligations hereunder.

11.10  CONSENT TO JURISDICTION; MUTUAL WAIVER OR JURY TRIAL.

(A)    ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK, AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH PARTY HEREBY IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID COURTS.  EACH PARTY HEREBY IRREVOCABLY DESIGNATES, APPOINTS AND EMPOWERS CT CORPORATION SYSTEM WITH OFFICES ON THE DATE HEREOF AT 1633 BROADWAY, NEW YORK, NEW YORK 10019 AS ITS DESIGNEE, APPOINTEE AND AGENT TO RECEIVE, ACCEPT AND ACKNOWLEDGE FOR AND ON ITS BEHALF, AND IN RESPECT OF ITS PROPERTY, SERVICE OF ANY AND ALL LEGAL PROCESS, SUMMONS, NOTICES AND DOCUMENTS WHICH MAY BE SERVED IN ANY SUCH ACTION OR PROCEEDING.  IF FOR ANY REASON SUCH DESIGNEE, APPOINTEE AND AGENT SHALL CEASE TO BE AVAILABLE TO ACT AS SUCH, THEN SUCH PARTY SHALL DESIGNATE A NEW DESIGNEE, APPOINTEE AND AGENT IN NEW YORK CITY ON THE TERMS AND FOR THE PURPOSES OF THIS PROVISION SATISFACTORY TO AGENT UNDER THIS AGREEMENT.  EACH PARTY FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO SUCH PARTY, AT ITS ADDRESS SET FORTH OPPOSITE ITS SIGNATURE BELOW.  NOTHING HEREIN SHALL AFFECT THE RIGHT OF ANY PARTY UNDER THIS AGREEMENT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST ANY PARTY IN ANY OTHER JURISDICTION.

(B)    EACH PARTY HEREBY IRREVOCABLY WAIVES ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF THE AFORESAID ACTIONS OR PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT BROUGHT IN THE COURTS REFERRED TO IN CLAUSE (A) ABOVE AND HEREBY FURTHER IRREVOCABLY WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.

(C)    EACH OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE TO TRIAL BY JURY IN ANY COURT OR JURISDICTION, INCLUDING WITHOUT LIMITATION THOSE REFERRED TO IN CLAUSE (A) ABOVE, IN RESPECT TO ANY MATTER ARISING OUT OF OR RELATING TO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.

11.11  Governing Law.  THIS AGREEMENT AND EACH NOTE SHALL BE DEEMED TO BE A CONTRACT MADE UNDER THE INTERNAL LAWS OF THE STATE OF NEW YORK, AND FOR ALL PURPOSES SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH SUCH LAWS OF SAID STATE, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.

11.12  Registry.  Borrower hereby designates Agent to serve as Borrower's agent, solely for purposes of this Section 11.12 to maintain a register (the "Register") on which it will record the Commitment from time to time of each of the Lenders, the Loans made by each of the Lenders and each repayment in respect of the principal amount of the Loans of each Lender.  Failure to make any such recordation, or any error in such recordation shall not affect Borrower's obligations in respect of such Loans.  With respect to any Lender, the transfer of the Commitments of such Lender and the rights to the principal of, and interest on, any Loan made pursuant to such Commitment shall not be effective until such transfer is recorded on the Register maintained by Agent with respect to ownership of such Commitment and Loans and prior to such recordation all amounts owing to the transferor with respect to such Commitments and Loans shall remain owing to the transferor.  The registration of assignment or transfer of all or part of any Commitment and Loans shall be recorded by Agent on the Register only upon the acceptance by Agent of a properly executed and delivered Assignment and Assumption Agreement pursuant to Section 11.9.  Coincident with the delivery of such an Assignment and Assumption Agreement to Agent for acceptance and registration of assignment or transfer of all or part of a Loan, or as soon thereafter as practicable, the assigning or transferor Lender shall surrender the Note evidencing such Loan, and thereupon one or more new Notes in the same aggregate principal amount then owing to such assignor or transferor Lender shall be issued to the assigning or transferor Lender and/or the new Lender. Borrower agrees to indemnify Agent from and against any and all losses, claims, damages and liabilities of whatsoever nature which may be imposed on, asserted against or incurred by Agent in performing its duties under this Section 11.12 except for those resulting solely from Agent's willful misconduct and/or gross negligence in the performance of such duties.

11.13  Severability of Provisions.  Any provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof or affecting the validity or enforceability of such provision in any other jurisdiction.

11.14  Headings.  The Table of Contents and article and section headings used in this Agreement are for convenience of reference only and shall not affect the construction of this Agreement.

11.15  Independent Nature of Lenders' Rights.  The amounts payable at any time under this Agreement to each Agent and each Lender shall be separate and independent debts; each Lender shall be entitled to protect and enforce its rights arising out of this Agreement; and it shall not be necessary for any Agent or any other Lender to be joined as an additional party in any proceeding for such purpose.

11.16  Survival of Representations.  Unless a longer period is provided herein, all covenants, agreements and representations in this Agreement shall survive the making by the Lenders of the Loans and the execution and delivery to Agent for the account of the Lenders of the Notes evidencing the Loans, regardless of any investigation made by any Agent or the Lenders and of the Agent's and the Lenders' access to any information, and shall continue in full force and effect until the final and indefeasible payment in full of the Notes and all of Borrower's obligations under this Agreement and the termination of the Revolving Commitments in their entirety.

11.17  Confidentiality.  Each of the Lenders severally agrees to keep confidential all non-public information pertaining to Borrower and its Subsidiaries which is provided to it by any such parties in accordance with such Lender's customary procedures for handling confidential information of this nature and in a prudent fashion, and shall not disclose such information to any Person except (i) to the extent such information is public when received by such Lender or becomes public thereafter due to the act or omission of any party other than a Lender, (ii) to the extent such information is independently obtained from a source other than Borrower or its Subsidiaries and such information from such source is not, to such Lender's knowledge, subject to an obligation of confidentiality or, if such information is subject to an obligation of confidentiality, that disclosure of such information is permitted, (iii) to an Affiliate of such Lender, counsel, auditors, examiners of any regulatory authority having jurisdiction over such Lender, accountants and other consultants retained by Agent or any Lender, (iv) in connection with any litigation or the enforcement of the rights of any Lender or Agent under this Agreement or any other Loan Document, (v) to the extent required by any applicable statute, rule or regulation or court order (including, without limitation, by way of subpoena) or pursuant to the request of any Governmental Authority having jurisdiction over any Lender or Agent; provided, however, that in such event, if the Lender(s) are able to do so, the Lender shall provide Borrower with prompt notice of such requested disclosure so that Borrower may seek a protective order or other appropriate remedy, and, in any event, the Lenders will endeavor in good faith to provide only that portion of such information which, in the reasonable judgment of the Lender(s), is relevant and legally required to be provided, or (vi) to the extent disclosure to other entities is appropriate in connection with any proposed or actual assignment or grant of a participation by any of the Lenders of interests in this Agreement and/or any of the other Loan Documents to such other financial institutions (who will in turn be required to maintain confidentiality as if they were Lenders parties to this Agreement).  In no event shall Agent or any Lender be obligated or required to return any such information or other materials furnished by Borrower.

11.18   Effectiveness.  This Agreement shall become effective on the date (the "Effective Date") on which Borrower, Agent and each of the Lenders shall have signed a counterpart of this Agreement (whether the same or different counterparts) and shall have delivered the same to the Agent at the Notice Office (or to Agent's counsel as directed by such counsel) or, in the case of the Lenders, shall have given to Agent or telephonic (confirmed in writing), written, telex or facsimile notice (actually received) at such office or the office of Agent's counsel that the same has been signed and mailed to it.  Agent will give Borrower and each Lender prompt written notice of the occurrence of the Effective Date.

11.19  Waiver of Immunities.  Subject to Section 11.10 of this Agreement, each Lender waives, in relation to any action or proceeding arising out of or relating to this Agreement or any Note, any sovereign immunity or other immunity to suit or to execution or attachment to which such Lender or any of its property may be or become entitled.

11.20  Concerning the Collateral and the Loan Documents.

(a)     Authority.  Each Lender (on its own behalf and on behalf of any Affiliate of such Lender which is a Secured Creditor) authorizes and directs DBTCA to act as collateral agent and to enter into the Loan Documents relating to the Collateral for the benefit of the Lenders and the other Secured Creditors.  Each Lender (on its own behalf and on behalf of any Affiliate of such Lender which is a Secured Creditor) agrees that any action taken by the Agent, the Collateral Agent or the Required Lenders (or, where required by the express terms, hereof, a different proportion of the Lenders) in accordance with the provisions hereof or of the other Loan Documents, and the exercise by the Agent, the Collateral Agent or the Required Lenders (or, where so required, such different proportion) of the powers set forth herein or therein, together with such other powers as are reasonably incidental thereto, shall be authorized and binding upon all of the Lenders and the other Secured Creditors. Without limiting the generality of the foregoing, the Agent and the Collateral Agent shall have the sole and exclusive right and authority to (i) act as the disbursing and collecting agent for the Lenders and the other Secured Creditors with respect to all payments and collections arising in connection herewith and with the Loan Documents relating to the Collateral; (ii) execute and deliver each Loan Document relating to the Collateral and accept delivery of each such agreement delivered by any Credit Party, (iii) act as collateral agent for the Lenders and the other Secured Creditors for purposes stated in the Loan Documents to the extent such perfection is required under the Loan Documents, provided, however, the Agent and the Collateral Agent hereby appoints, authorizes and directs each Lender and the other Secured Creditors to act as collateral sub-agent for the Agent, the Collateral Agent and the Lenders for purposes of the perfection of all security interests and Liens with respect to each Credit Party's respective deposit accounts maintained with, and cash and Cash Equivalents held by, such Lender or such other Secured Creditor; (iv) manage, supervise and otherwise deal with the Collateral; (v) take such action as is necessary or desirable to maintain the perfection and priority of the security interests and liens created or purported to be created by the Loan Documents, and (vi) except as may be otherwise specifically restricted by the terms hereof or of any other Loan Document, exercise all remedies given to the Agent or the Lenders with respect to the Collateral under the Loan Documents relating thereto, applicable law or otherwise.

(b)     Release of Collateral.  

(i)     The Agent and each Lender (on its own behalf and on behalf of any Affiliate of such Lender that is a Secured Creditor) hereby directs the Agent and the Collateral Agent to release, in accordance with the terms hereof, any Lien held by the Agent or the Collateral Agent, under the Security Documents:

(A)    against all of the Collateral, upon final and indefeasible payment in full in cash of the Loans and Obligations and termination of all Commitments and Letters of Credit and termination hereof;

(B)    against any part of the Collateral sold or disposed of by Borrower or any of its Subsidiaries to the extent such sale or disposition is permitted hereby (or permitted pursuant to a waiver or consent of a transaction otherwise prohibited hereby);

(C)    against any Collateral acquired by Borrower or any of its Subsidiaries after the Third Amended and Restated Effective Date and at least 80% of the purchase price therefor is within 120 days of the acquisition thereof financed with Purchase Money Indebtedness secured by a Lien permitted by clause (ix) of the definition of Permitted Liens.

(D)    so long as no Unmatured Event of Default or Event of Default has occurred and is continuing, in the sole discretion of the Agent upon the request of Borrower, against any part of the Collateral with a fair market value of less than $1,000,000 in the aggregate during the term of this Agreement as such fair market value may be certified to the Agent by Borrower in an officer's certificate acceptable in form and substance to the Agent; and

(E)    against a part of the Collateral which release does not require the consent of all of the Lenders as set forth in Section 11.1(a), if such release is consented to by the Required Lenders;

provided, however, that (y) the Agent and the Collateral Agent shall not be required to execute any such document on terms which, in its opinion, would expose it to liability or create any obligation or entail any consequence other than the release of such Liens without recourse or warranty, and (z) such release shall not in any manner discharge, affect or impair the Obligations or any Liens upon (or obligations of Borrower or any of its Subsidiaries in respect of) all interests retained by Borrower and/or any of its Subsidiaries, including (without limitation) the proceeds of any sale, all of which shall continue to constitute part of the Collateral.

(ii)     Each Lender (on its own behalf and on behalf of any Affiliate of such Lender that is a Secured Creditor) hereby directs the Agent and the Collateral Agent (and the Agent and the Collateral Agent agree) to execute and deliver or file such termination and partial release statements and such other things as are necessary to release Liens to be released pursuant to this Section 11.20 promptly upon the effectiveness of any such release or enter into intercreditor agreements contemplated or permitted herein.

(c)     No Obligation.  Neither the Agent nor the Collateral Agent shall have any obligation whatsoever to any Lender or any other Secured Creditor or to any other Person to assure that the Collateral exists or is owned by any Credit Party or is cared for, protected or insured or has been encumbered or that the Liens granted to the Agent and the Collateral Agent herein or pursuant to the Loan Documents have been properly or sufficiently or lawfully created, perfected, protected or enforced or are entitled to any particular priority, 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 the Agent or the Collateral Agent in any of the Loan Documents, it being understood and agreed that in respect of the Collateral, or any act, omission or event related thereto, Agent and the Collateral Agent may act in any manner it may deem appropriate, in its sole discretion, given the Agent's and the Collateral Agent's own interests in the Collateral as one of the Lenders and that the Agent and the Collateral Agent shall not have any duty or liability whatsoever to any Lender, provided, that, notwithstanding the foregoing, the Agent and the Collateral Agent shall be responsible for its grossly negligent actions or actions constituting intentional misconduct.

      IN WITNESS WHEREOF, the parties hereto have caused this Third Amended and Restated Credit Agreement to be executed by their respective officers thereunto duly authorized, as of the date first above written.

BMC INDUSTRIES, INC.

By:  /s/ Curtis E. Petersen

Name:  Curtis E. Petersen

Title:  Senior Vice President, Finance and Administration, Chief Financial Officer

 

DEUTSCHE BANK TRUST COMPANY AMERICAS (formerly named Bankers Trust Company),
individually as a Lender and as Agent

By:  /s/ M.A. Orlando

Name:  Marco Orlando

Title:  Director

BANK ONE, NA (Main Office Chicago)
individually as a Lender and as documentation agent

By:  /s/ Henry W. Howe

Name:  Henry W. Howe

Title:  Officer

WELLS FARGO BANK MINNESOTA, NATIONAL ASSOCIATION (f/k/a Norwest Bank Minnesota, National Association)

By:  /s/ Calvin R. Emerson

Name:  Calvin R. Emerson

Title:  Vice President

HARRIS TRUST AND SAVINGS BANK

By:  /s/ George M. Oluhy

Name:  George M. Oluhy

Title:  Vice President

CREDIT AGRICOLE INDOSUEZ

By:  /s/ Larry Materi

Name:  Larry Materi

Title:  Vice President

WACHOVIA BANK, N.A.

By:  /s/ Richard E.S. Bowen

Name:  Richard E.S. Bowen

Title:  Vice President

UNION BANK OF CALIFORNIA, N.A.

By:  /s/ Jeffrey Mumm

Name:  Jeffrey Mumm

Title:  Vice President

U.S. BANK NATIONAL ASSOCIATION

By:  /s/ Nicholas G. Myers

Name:  Nicholas G. Myers

Title:  Assistant Vice President

EX-10.46

TABLE OF CONTENTS

ARTICLE I SECURITY INTERESTS			5
	1.1	Grant of Security Interests	5
	1.2	Power of Attorney	5
ARTICLE II GENERAL REPRESENTATIONS, WARRANTIES AND COVENANTS			6
	2.1	Chief Executive Office/Inventory and Equipment Locations	6
	2.2	State of Incorporation	6
	2.3	Trade Names; CHANGE OF NAME	7
ARTICLE III PROVISIONS CONCERNING ALL COLLATERAL			7
	3.1	Protection of Administrative Agent's Security	7
	3.2	Warehouse Receipts Non-Negotiable; THIRD-PARTY ACKNOWLEDGMENTS	7
	3.3	Further Actions	8
	3.4	Financing Statements	8
ARTICLE IV REMEDIES UPON OCCURRENCE OF EVENT OF DEFAULT			8
	4.1	Remedies; Obtaining the Collateral Upon Default	8
	4.2	Remedies; Disposition of the Collateral	9
	4.3	Waiver of Claims	10
	4.4	Application of Proceeds	11
	4.5	Remedies Cumulative	13
	4.6	Discontinuance of Proceedings	13
ARTICLE V INDEMNITY			14
	5.1	Indemnity	14
	5.2	Indemnity Obligations Secured by Collateral; SURVIVAL	14
ARTICLE VI DEFINITIONS			15
ARTICLE VII MISCELLANEOUS			19
	7.1	Notices	19
	7.2	Waiver; AMENDMENT	19
	7.3	Obligations Absolute	19
	7.4	Successors and Assigns	19
	7.5	Headings Descriptive	20
	7.6	Severability	20
	7.7	GOVERNING LAW	20
	7.8	Borrower's Duties	20
	7.9	Termination; RELEASE	20
	7.10	Counterparts	21
	7.11	The Administrative Agent	21
ARTICLE VIII SPECIAL PROVISIONS CONCERNING ACCOUNTS;  CONTRACT RIGHTS;  INSTRUMENTS			22
	8.1	Additional Representations and Warranties	22
	8.2	Maintenance of Records	22
	8.3	Modification of Terms; ETC	23
	8.4	Collection	23
	8.5	Instruments	23
	8.6	Further Actions	23
ARTICLE IX SPECIAL PROVISIONS CONCERNING MARKS			24
	9.1	Additional Representations and Warranties	24
	9.2	Licenses and Assignments	24
	9.3	Infringements	24
	9.4	Preservation of Marks	24
	9.5	Maintenance of Registration	24
	9.6	Future Registered Marks	25
	9.7	Remedies	25
ARTICLE X SPECIAL PROVISIONS CONCERNING PATENTS AND COPYRIGHTS AND TRADE SECRETS			25
	10.1	Additional Representations and Warranties	25
	10.2	Licenses and Assignments	26
	10.3	Infringements	26
	10.4	Maintenance of Patents	26
	10.5	Prosecution of Patent Application	26
	10.6	Other Patents and Copyrights	27
	10.7	Remedies	27

;

ANNEX A	Schedule of Chief Executive Offices
ANNEX B	Schedule of Inventory and Equipment Locations
ANNEX C	Schedule of Trade, Fictitious and Other Names
ANNEX D	Schedule of Marks
ANNEX E	Schedule of License Agreements and Assignments
ANNEX F	Schedule of Patents and Copyrights
ANNEX G	Schedule of Copyrights and Applications
ANNEX H	Assignment of Security Interest in U.S. Trademarks and Patents
ANNEX I	Assignment of Security Interest in U.S. Copyrights

AMENDED AND RESTATED

SECURITY AGREEMENT

between

BMC INDUSTRIES, INC.,

DEUTSCHE BANK TRUST COMPANY AMERICAS
(formerly named Bankers Trust Company),
as Administrative Agent

and

U.S. BANK NATIONAL ASSOCIATION

Dated as of September 27, 2002

AMENDED AND RESTATED SECURITY AGREEMENT

THIS AMENDED AND RESTATED SECURITY AGREEMENT, dated as of September 27, 2002, is between BMC INDUSTRIES, INC., a Minnesota corporation ("Borrower"), DEUTSCHE BANK TRUST COMPANY AMERICAS (formerly named Bankers Trust Company), as administrative agent (the "Administrative Agent") and U.S. BANK NATIONAL ASSOCIATION ("US Bank") for the benefit of (i) the Lenders and the Agent under the Credit Agreement hereinafter referred to (such Lenders and the Agent are hereinafter called the "Bank Creditors"), (ii) if one or more Lenders (or any Affiliate thereof) enter into one or more (A) interest rate protection agreements (including, without limitation, interest rate swaps, caps, floors, collars and similar agreements), (B) foreign exchange contracts, currency swap agreements or other similar agreements or arrangements designed to protect against the fluctuations in currency values and/or (C) other types of hedging agreements from time to time (collectively, the "Interest Rate Protection or Other Hedging Agreements") with, or guaranteed by, Borrower, any such Lender or Lenders or any Affiliate of such Lender or Lenders (even if the respective Lender subsequently ceases to be a Lender under the Credit Agreement for any reason) so long as any such Lender or Affiliate participates in the extension of such Interest Rate Protection or Other Hedging Agreements and their subsequent assigns, if any (collectively, the "Other Creditors") and (iii) US Bank as lender under the US Bank Letter of Credit Facility (as defined below) (the "LC Creditor" and, together with the Other Creditors and the Bank Creditors, hereinafter called the "Secured Creditors").  Except as otherwise defined herein, terms used herein and defined in the Credit Agreement (as hereinafter defined) shall be used herein as so defined.

W I T N E S S E T H :

WHEREAS, Borrower, the financial institutions (the "Lenders") from time to time party thereto and Bankers Trust Company, as Administrative Agent (together with any successor agent, the "Agent"), have entered into an Amended and Restated Credit Agreement, dated as of June 25, 1998, providing for the making of Loans and the issuance of, and participation in, Letters of Credit as contemplated therein (as used herein, the term "Credit Agreement" means the Credit Agreement described above in this paragraph, as in effect on the date hereof and as amended by that certain Second Amendment and Restatement Agreement dated as of October 12, 2001 and as amended and restated by that certain Third Amended and Restated Credit Agreement dated as of the date hereof, as the same may be amended, modified, extended, renewed, replaced, restated or supplemented from time to time, and including any agreement extending the maturity of or restructuring of all or any portion of the Indebtedness under such agreement or any successor agreements);

WHEREAS, Borrower may at any time and from time to time enter into, or guarantee, one or more Interest Rate Protection or Other Hedging Agreements with one or more Other Creditors;

WHEREAS, Borrower, Administrative Agent and US Bank previously entered into a Security Agreement dated as of October 12, 2001 (the "Original Security Agreement");

WHEREAS, it is a condition precedent to each of the above-described extensions of credit that Borrower shall have executed and delivered this Agreement which shall amend and restate the Original Security Agreement in its entirety; and

WHEREAS, Borrower desires to enter into this Agreement in order to satisfy the condition described in the preceding paragraph;

NOW, THEREFORE, in consideration of the extensions of credit to be made to Borrower and other benefits accruing to Borrower, the receipt and sufficiency of which are hereby acknowledged, Borrower hereby makes the following representations and warranties to the Administrative Agent for the benefit of the Secured Creditors and hereby covenants and agrees with the Administrative Agent for the benefit of the Secured Creditors as follows:

ARTICLE I
SECURITY INTERESTS

1.1              Grant of Security Interests.  (a)  As security for the prompt and complete payment and performance when due of all of the Obligations, Borrower does hereby pledge and grant to the Administrative Agent for the benefit of the Secured Creditors, a continuing security interest of first priority (subject to Liens evidenced by Permitted Filings and other Permitted Liens) in, all of the right, title and interest of Borrower in, to and under all of the following, whether now existing or hereafter from time to time acquired:  (i) each and every Account, (ii) all Contracts, together with all Contract Rights arising thereunder, (iii) all Inventory, (iv) all Equipment, (v) all Marks, together with the registrations and right to all renewals thereof, and the goodwill of the business of Borrower symbolized by the Marks, (vi) all Patents and Copyrights, and all reissues, renewals or extensions thereof, (vii) all computer programs of Borrower and all intellectual property rights therein and all other proprietary information of Borrower, including, but not limited to, Trade Secrets, (viii) all other Goods, General Intangibles, Chattel Paper, Documents, Investment Property and Instruments, (ix) Letter of Credit Rights, (x) Deposit Accounts, (xi) all cash, accounts, deposits and insurance policies now or at any time hereafter in the possession or under control of Borrower or its respective bailees and any interest therein, (xii) all vehicles, aircraft, vessels, barges, railcars, rolling stock and fixtures owned by the Borrower, together with accessions thereto and replacement parts therefor, and (xiii) all Proceeds and products of any and all of the foregoing (all of the above, collectively, the "Collateral").

(b)  The security interests of the Administrative Agent under this Agreement extend to all Collateral of the kind which is the subject of this Agreement which Borrower may acquire at any time during the continuation of this Agreement.

1.2              Power of Attorney.  Borrower hereby constitutes and appoints the Administrative Agent its true and lawful attorney, with full power after the occurrence of and during the continuance of an Event of Default (in the name of Borrower or otherwise), in the Administrative Agent's reasonable discretion, to take any action and to execute any instrument required by this Agreement if Borrower has failed to do so after demand by the Administrative Agent.

ARTICLE II
GENERAL REPRESENTATIONS, WARRANTIES AND COVENANTS

Borrower represents, warrants and covenants, which representations, warranties and covenants shall survive execution and delivery of this Agreement, as follows:

2.1              Chief Executive Office/Inventory and Equipment Locations.  The chief executive office of Borrower is located at the address indicated on Annex A hereto.  All Inventory and Equipment held on the date hereof by Borrower is located at one of the locations shown on Annex B hereto (other than (i) immaterial portions of Inventory or Equipment or (ii) Equipment out for repair).    Prior to January 1, 2002, the Borrower shall not (x) move its chief executive office to any of the States of Mississippi, Alabama or Florida, or (y) move any Inventory or Equipment to any of the States of Mississippi, Alabama or Florida until (i) it shall have given to the Administrative Agent not less than 30 days' prior written notice of its intention to do so, (ii) with respect to such move, it shall have taken all action, reasonably satisfactory to the Administrative Agent, to maintain the security interest of the Administrative Agent in the Collateral intended to be granted and perfected under the Uniform Commercial Code hereby at all times fully perfected and in full force and effect, (iii) at the reasonable request of the Administrative Agent, it shall have furnished a customary opinion of counsel reasonably acceptable to the Administrative Agent to the effect that all financing or continuation statements and amendments or supplements thereto have been filed in the appropriate filing office or offices, and all other actions (including, without limitation, the payment of all filing fees and taxes, if any, payable in connection with such filings) have been taken, in order to perfect (and maintain the perfection and priority of) the security interest granted hereby and (iv) the Administrative Agent shall have received evidence that all other actions (including, without limitation, the payment of all filing fees and taxes, if any, payable in connection with such filings) have been taken, in order to perfect (and maintain the perfection and priority of) the security interest granted hereby.

2.2              State of Incorporation.  The state of incorporation of Borrower is indicated on Annex A hereto.  Borrower will not change its state of incorporation except as in accordance with the last sentence of this Section 2.2.  Borrower shall not establish a new state of incorporation until (i) it shall have given to the Administrative Agent not less than 30 days' prior written notice of its intention to do so, clearly describing such new state of incorporation and providing such other information in connection therewith as the Administrative Agent may reasonably request, (ii) with respect to such new state of incorporation, it shall have taken all action, reasonably satisfactory to the Administrative Agent, to maintain the security interest of the Administrative Agent in the Collateral intended to be granted and perfected under the Uniform Commercial Code hereby at all times fully perfected and in full force and effect, (iii) at the reasonable request of the Administrative Agent, it shall have furnished a customary opinion of counsel reasonably acceptable to the Administrative Agent to the effect that all financing or continuation statements and amendments or supplements thereto have been filed in the appropriate filing office or offices, and all other actions (including, without limitation, the payment of all filing fees and taxes, if any, payable in connection with such filings) have been taken, in order to perfect (and maintain the perfection and priority of) the security interest granted hereby and (iv) the Administrative Agent shall have received evidence that all other actions (including, without limitation, the payment of all filing fees and taxes, if any, payable in connection with such filings have been taken, in order to perfect (and maintain the perfection and priority of) the security interest granted hereby.

2.3              Trade Names; Change of Name.  Borrower does not have and has not operated in any jurisdiction under, or in the preceding 12 months has not had nor has operated in any jurisdiction under, any trade names, fictitious names or other names (including, without limitation, any names of divisions or operations) except its legal name and such other trade, fictitious or other names as are listed on Annex C hereto.  The corporation identification number or other applicable formation identification number shall be set forth across from the exact legal name of Borrower identified in Annex C.  Borrower shall not change its legal name or assume or operate in any jurisdiction under any trade, fictitious or other name in any manner which might make any financing statement or continuation statement filed in connection therewith seriously misleading except those names listed on Annex C hereto and new names (including, without limitation, any names of divisions or operations) established in accordance with the last sentence of this Section 2.3.  Borrower shall not assume or operate in any jurisdiction under any new trade, fictitious or other name that would make any financing statement or continuation statement filed in connection therewith, seriously misleading until (i) it shall have given to the Administrative Agent not less than 30 days' prior written notice of its intention so to do, clearly describing such new name and the jurisdictions in which such new name shall be used and providing such other information in connection therewith as the Administrative Agent may reasonably request, (ii) with respect to such new name, it shall have taken all action to maintain the security interest of the Administrative Agent in the Collateral intended to be granted hereby at all times fully perfected and in full force and effect, (iii) at the reasonable request of the Administrative Agent, it shall have furnished a customary opinion of counsel reasonablyacceptable to the Administrative Agent to the effect that all financing or continuation statements and amendments or supplements thereto have been filed in the appropriate filing office or offices, and (iv) the Administrative Agent shall have received evidence that all other actions (including, without limitation, the payment of all filing fees and taxes, if any, payable in connection with such filings) have been taken, in order to perfect (and maintain the perfection and priority of) the security interest granted hereby.

ARTICLE III
PROVISIONS CONCERNING ALL COLLATERAL

3.1              Protection of Administrative Agent's Security.  Borrower will do nothing to impair the rights of the Administrative Agent in the Collateral other than dispositions, the creation of Liens and other encumbrances and other actions permitted hereunder and under the Credit Agreement and other Loan Documents.  

3.2              Warehouse Receipts Non-Negotiable; Third-Party Acknowledgments.  Borrower agrees that if any warehouse receipt or receipt in the nature of a warehouse receipt is issued with respect to any of its Inventory, such warehouse receipt or receipt in the nature thereof shall not be "negotiable" (as such term is used in Section 7-104 of the Uniform Commercial Code as in effect in any relevant jurisdiction or under other relevant law).  Where Collateral with a fair market value of greater than $100,000 is in the possession of a third party, Borrower will promptly notify Administrative Agent of the occurrence of any such fact and will join with the Administrative Agent in notifying the third party of the Administrative Agent's security interest and obtaining an acknowledgment from the third party that it is holding the Collateral for the benefit of the Administrative Agent.

3.3              Further Actions.  Borrower will, at its own expense, make, execute, endorse, acknowledge, file and/or deliver to the Administrative Agent from time to time such lists, descriptions and designations of its Collateral, warehouse receipts, receipts in the nature of warehouse receipts, bills of lading, documents of title, vouchers, invoices, schedules, confirmatory assignments, conveyances, financing statements, transfer endorsements, powers of attorney, certificates, reports and other assurances or instruments and take such further steps relating to the Collateral and other property or rights covered by the security interest hereby granted, which the Administrative Agent deems reasonably appropriate or advisable to perfect, preserve or protect its security interest in the Collateral.  

3.4              Financing Statements.  Borrower agrees to deliver to the Administrative Agent such financing statements, in form reasonably acceptable to the Administrative Agent, as the Administrative Agent may from time to time reasonably request or as are reasonably  necessary (or desirable in the reasonable opinion of the Administrative Agent) to establish and maintain a valid, enforceable, first priority perfected security interest (subject only to Permitted Liens) in the Collateral as provided herein and the other rights and security contemplated hereby all in accordance with the Uniform Commercial Code as enacted in any and all relevant jurisdictions or any other relevant law.  Borrower will pay any applicable filing fees, recordation taxes and related expenses relating to its Collateral.  Borrower hereby authorizes the Administrative Agent to file any such Uniform Commercial Code financing statements without the signature of Borrower where permitted by law.

ARTICLE IV
REMEDIES UPON OCCURRENCE OF EVENT OF DEFAULT

4.1              Remedies; Obtaining the Collateral Upon Default.  Borrower agrees that, if any Event of Default shall have occurred and be continuing, then and in every such case, subject to any mandatory requirements of applicable law then in effect, the Administrative Agent, in addition to any rights now or hereafter existing under applicable law, shall have all rights as a secured creditor under the Uniform Commercial Code in all relevant jurisdictions and may:

(a)        personally, or by agents or attorneys, immediately take possession of the Collateral or any part thereof, from Borrower or any other Person who then has possession of any part thereof with or without notice or process of law, and for that purpose may enter upon Borrower's premises where any of the Collateral is located and remove the same and use in connection with such removal any and all services, supplies, aids and other facilities of Borrower; and

(b)        instruct the obligor or obligors on any agreement, instrument or other obligation (including, without limitation, the Accounts and the Contracts) constituting the Collateral to make any payment required by the terms of such agreement, instrument or other obligation directly to the Administrative Agent and may exercise any and all remedies of Borrower in respect of such Collateral; and

(c)       sell, assign or otherwise liquidate, or direct Borrower to sell, assign or otherwise liquidate, any or all of the Collateral or any part thereof, and take possession of the proceeds of any such sale or liquidation; and

(d)        take possession of the Collateral or any part thereof, by directing Borrower in writing to deliver the same to the Administrative Agent at any place or places reasonably designated by the Administrative Agent, in which event Borrower shall at its own expense:

(i)         forthwith cause the same to be moved to the place or places so designated by the Administrative Agent and there delivered to the Administrative Agent, and

(ii)        store and keep any Collateral so delivered to the Administrative Agent at such place or places pending further action by the Administrative Agent as provided in Section 6.2 hereof, and

(iii)       while the Collateral shall be so stored and kept, provide such guards and maintenance services as shall be necessary to protect the same and to preserve and maintain them in good condition; and

(e)        license or sublicense (to the extent not in violation of the license), whether on an exclusive or nonexclusive basis, any Marks (together with associated goodwill), Patents or Copyrights included in the Collateral for such term and on such conditions and in such manner as the Administrative Agent shall in its sole judgment determine (taking into account such provisions as may be necessary to protect and preserve such Marks, Patents or Copyrights); and

it being understood that Borrower's obligation so to deliver the Collateral is of the essence of this Agreement and that, accordingly, upon application to a court of equity having jurisdiction, the Administrative Agent shall be entitled to seek a decree requiring specific performance by Borrower of said obligation.

4.2              Remedies; Disposition of the Collateral.  If an Event of Default shall have occurred and be continuing, then any Collateral repossessed by the Administrative Agent under or pursuant to Section 4.1 hereof and any other Collateral whether or not so repossessed by the Administrative Agent, may be sold, assigned, leased or otherwise disposed of under one or more contracts or as an entirety, and without the necessity of gathering at the place of sale the property to be sold, and in general in such manner, at such time or times, at such place or places and on such terms as the Administrative Agent may, in compliance with any mandatory requirements of applicable law, determine to be commercially reasonable.  Any of the Collateral may be so sold, leased or otherwise disposed of, in the condition in which the same existed when taken by the Administrative Agent or after any overhaul or repair at the expense of Borrower which the Administrative Agent shall determine to be commercially reasonable.  Any such disposition which shall be a private sale or other private proceedings permitted by such requirements shall be made upon not less than 10 days' written notice to Borrower specifying the time at which such disposition is to be made and the intended sale price or other consideration therefor, and shall be subject, for the 10 days after the giving of such notice, to the right of Borrower or any nominee of Borrower to acquire the Collateral involved at a price or for such other consideration at least equal to the intended sale price or other consideration so specified.  Any such disposition which shall be a public sale permitted by such requirements shall be made upon not less than 10 days' written notice to Borrower specifying the time and place of such sale and, in the absence of applicable requirements of law, shall be by public auction (which may, at the Administrative Agent's option, be subject to reserve), after publication of notice of such auction not less than 10 days prior thereto in two newspapers in general circulation in the City of New York or in such other locations as may be necessary in order for the sale to be "commercially reasonable" (as such term is used in Article 9 Part V of the New York Uniform Commercial Code).  To the extent permitted by any such requirement of law, the Administrative Agent and the Secured Creditors may bid for and become the purchaser of the Collateral or any item thereof, offered for sale in accordance with this Section without accountability to Borrower.  If, under mandatory requirements of applicable law, the Administrative Agent shall be required to make disposition of the Collateral within a period of time which does not permit the giving of notice to Borrower as hereinabove specified, the Administrative Agent need give Borrower only such notice of disposition as shall be reasonably practicable in view of such mandatory requirements of applicable law.  Borrower agrees to do or cause to be done all such other acts and things as may be reasonably necessary to make such sale or sales of all or any portion of the Collateral valid and binding and in compliance with any and all applicable laws, regulations, orders, writs, injunctions, decrees or awards of any and all courts, arbitrators or governmental instrumentalities, domestic or foreign, having jurisdiction over any such sale or sales, all at Borrower's expense.

4.3              Waiver of Claims.  Except as otherwise provided in this Agreement, BORROWER HEREBY WAIVES, TO THE EXTENT PERMITTED BY APPLICABLE LAW, NOTICE AND JUDICIAL HEARING IN CONNECTION WITH THE ADMINISTRATIVE AGENT'S TAKING POSSESSION OR THE ADMINISTRATIVE AGENT'S DISPOSITION OF ANY OF THE COLLATERAL, INCLUDING, WITHOUT LIMITATION, ANY AND ALL PRIOR NOTICE AND HEARING FOR ANY PREJUDGMENT REMEDY OR REMEDIES AND ANY SUCH RIGHT WHICH BORROWER WOULD OTHERWISE HAVE UNDER THE CONSTITUTION OR ANY STATUTE OF THE UNITED STATES OR OF ANY STATE, and Borrower hereby further waives, to the extent permitted by law:

(a)        all damages occasioned by such taking of possession except any damages which are the direct result of the Administrative Agent's gross negligence or willful misconduct;

(b)        all other requirements as to the time, place and terms of sale or other requirements with respect to the enforcement of the Administrative Agent's rights hereunder; and

(c)        all rights of redemption, appraisement, valuation, stay, extension or moratorium now or hereafter in force under any applicable law in order to prevent or delay the enforcement of this Agreement or the absolute sale of the Collateral or any portion thereof, and Borrower, for itself and all who may claim under it, insofar as it or they now or hereafter lawfully may, hereby waives the benefit of all such laws.

Any sale of, or the grant of options to purchase, or any other realization upon, any Collateral shall operate to divest all right, title, interest, claim and demand, either at law or in equity, of Borrower therein and thereto, and shall be a perpetual bar both at law and in equity against Borrower and against any and all Persons claiming or attempting to claim the Collateral so sold, optioned or realized upon, or any part thereof, from, through and under Borrower.

4.4              Application of Proceeds.  (a)  All moneys collected by the Administrative Agent (or, to the extent the Pledge Agreement or any Mortgage to which Borrower is a party requires proceeds of Collateral under such agreement to be applied in accordance with the provisions of this Agreement, the Pledgee or Mortgagee under such other agreement) upon any sale or other disposition of the Collateral, together with all other moneys received by the Administrative Agent hereunder, shall be applied as follows:

(i)         first, to the payment of all amounts owing the Administrative Agent of the type    described in clauses (iii) and (iv) of the definition of "Obligations";

(ii)        second, to the extent proceeds remain after the application pursuant to the preceding clause (i), an amount equal to the outstanding Primary Obligations shall be paid to the Secured Creditors as provided in Section 4.4(e) hereof, with each Secured Creditor receiving an amount equal to such outstanding Primary Obligations or, if the proceeds are insufficient to pay in full all such Primary Obligations, its Pro Rata Share of the amount remaining to be distributed;

(iii)       third, to the extent proceeds remain after the application pursuant to the preceding clauses (i) and (ii), an amount equal to the outstanding Secondary Obligations shall be paid to the Secured Creditors as provided in Section 4.4(e), with each Secured Creditor receiving an amount equal to its outstanding Secondary Obligations or, if the proceeds are insufficient to pay in full all such Secondary Obligations, its Pro Rata Share of the amount remaining to be distributed; and

(iv)       fourth, to the extent proceeds remain after the application pursuant to the preceding clauses (i) through (iii), inclusive, and following the termination of this Agreement pursuant to Section 7.9(a) hereof, to Borrower or to whomever may be lawfully entitled to receive such surplus.

(b)        For purposes of this Agreement (i) "Pro Rata Share" shall mean, when calculating a Secured Creditor's portion of any distribution or amount, that amount (expressed as a percentage) equal to a fraction the numerator of which is the then unpaid amount of such Secured Creditor's Primary Obligations or Secondary Obligations, as the case may be, and the denominator of which is the then outstanding amount of all Primary Obligations or Secondary Obligations, as the case may be, (ii) "Primary Obligations" shall mean (A) in the case of the Credit Agreement Obligations, all principal of, and interest on, all Loans, all Unpaid Drawings theretofore made (together with all interest accrued thereon), and the aggregate Stated Amounts of all Letters of Credit issued (or deemed issued) under the Credit Agreement, and all Fees and (B) in the case of the Other Obligations, all amounts due under the Interest Rate Protection or Other Hedging Agreements (other than indemnities, fees (including, without limitation, attorneys' fees) and similar obligations and liabilities) and (iii) "Secondary Obligations" shall mean all Obligations other than Primary Obligations.

(c)        When payments to Secured Creditors are based upon their respective Pro Rata Shares, the amounts received by such Secured Creditors hereunder shall be applied (for purposes of making determinations under this Section 4.4 only) (i) first, to their Primary Obligations and (ii) second, to their Secondary Obligations.  If any payment to any Secured Creditor of its Pro Rata Share of any distribution would result in overpayment to such Secured Creditor, such excess amount shall instead be distributed in respect of the unpaid Primary Obligations or Secondary Obligations, as the case may be, of the other Secured Creditors, with each Secured Creditor whose Primary Obligations or Secondary Obligations, as the case may be, have not been paid in full to receive an amount equal to such excess amount multiplied by a fraction the numerator of which is the unpaid Primary Obligations or Secondary Obligations, as the case may be, of such Secured Creditor and the denominator of which is the unpaid Primary Obligations or Secondary Obligations, as the case may be, of all Secured Creditors entitled to such distribution.

(d)        Each of the Secured Creditors agrees and acknowledges that if the Bank Creditors are to receive a distribution on account of undrawn amounts with respect to Letters of Credit issued (or deemed issued) under the Credit Agreement (which shall only occur after all outstanding Loans and Unpaid Drawings with respect to such Letters of Credit have been paid in full), such amounts shall be paid to the Agent under the Credit Agreement and held by it, for the equal and ratable benefit of the Bank Creditors, as cash security for the repayment of Obligations owing to the Bank Creditors as such.  If any amounts are held as cash security pursuant to the immediately preceding sentence, then upon the termination of all outstanding Letters of Credit, and after the application of all such cash security to the repayment of all Obligations owing to the Bank Creditors after giving effect to the termination of all such Letters of Credit, if there remains any excess cash, such excess cash shall be returned by the Agent to the Administrative Agent for distribution in accordance with Section 4.4(a) hereof.

(e)        Except as set forth in Section 4.4(d) hereof, all payments required to be made hereunder shall be made (i) if to the Bank Creditors, to the Agent under the Credit Agreement for the account of the Bank Creditors, and (ii) if to the Other Creditors, to the trustee, paying agent or other similar representative (each a "Representative") for the Other Creditors or, in the absence of such a Representative, directly to the Other Creditors.

(f)         For purposes of applying payments received in accordance with this Section 4.4, the Administrative Agent shall be entitled to rely upon (i) the Agent under the Credit Agreement and (ii) the Representative for the Other Creditors or, in the absence of such a Representative, upon the Other Creditors for a determination (which the Agent, each Representative for any Secured Creditors and the Secured Creditors agree (or shall agree) to provide upon request of the Administrative Agent) of the outstanding Primary Obligations and Secondary Obligations owed to the Bank Creditors or the Other Creditors, as the case may be.  Unless it has actual knowledge (including by way of written notice from a Bank Creditor or an Other Creditor) to the contrary, the Agent and each Representative, in furnishing information pursuant to the preceding sentence, and the Administrative Agent, in acting hereunder, shall be entitled to assume that no Secondary Obligations are outstanding.  Unless it has actual knowledge (including by way of written notice from an Other Creditor) to the contrary, the Administrative Agent, in acting hereunder, shall be entitled to assume that no Interest Rate Protection or Other Hedging Agreements are in existence.

(g)        It is understood and agreed that Borrower shall remain jointly and severally liable to the extent of any deficiency between the amount of the proceeds of the Collateral hereunder and the aggregate amount of the sums referred to in clauses (i) through (iii), inclusive, of Section 4.4(a) hereof.

4.5              Remedies Cumulative.   Each and every right, power and remedy hereby specifically given to the Administrative Agent shall be in addition to every other right, power and remedy specifically given under this Agreement, the Interest Rate Protection or Other Hedging Agreements, the other Loan Documents or now or hereafter existing at law or in equity, or by statute and each and every right, power and remedy whether specifically herein given or otherwise existing may be exercised from time to time or simultaneously and as often and in such order as may be deemed expedient by the Administrative Agent.   All such rights, powers and remedies shall be cumulative and the exercise or the beginning of the exercise of one shall not be deemed a waiver of the right to exercise any other or others.   No delay or omission of the Administrative Agent in the exercise of any such right, power or remedy and no renewal or extension of any of the Obligations and no course of dealing between Borrower and the Administrative Agent or any holder of any of the Obligations shall impair any such right, power or remedy or shall be construed to be a waiver of any Default or Event of Default or an acquiescence therein.  No notice to or demand on Borrower in any case shall entitle it to any other or further notice or demand in similar or other circumstances or constitute a waiver of any of the rights of the Administrative Agent to any other or further action in any circumstances without notice or demand.   In the event that the Administrative Agent shall bring any suit to enforce any of its rights hereunder and shall be entitled to judgment, then in such suit the Administrative Agent may recover reasonable expenses, including reasonable attorneys' fees, and the amounts thereof shall be included in such judgment.

4.6              Discontinuance of Proceedings.  In case the Administrative Agent shall have instituted any proceeding to enforce any right, power or remedy under this Agreement by foreclosure, sale, entry or otherwise, and such proceeding shall have been discontinued or abandoned for any reason or shall have been determined adversely to the Administrative Agent, then and in every such case Borrower, the Administrative Agent and each holder of any of the Obligations shall be restored to their former positions and rights hereunder with respect to the Collateral subject to the security interest created under this Agreement (except to the extent of any such adverse determination), and all rights, remedies and powers of the Administrative Agent shall continue (a) as if no such proceeding had been instituted, in the case of any such proceeding so discontinued or abandoned, or (b) as if no proceeding had been instituted, except to the extent of the determination, in the case of any such proceeding so adversely determined.

ARTICLE V
INDEMNITY

5.1              Indemnity.  (a)  Borrower agrees to indemnify and hold harmless the Administrative Agent and each Secured Creditor and their respective successors, assigns, employees, agents and servants (individually an "Indemnitee," and collectively the "Indemnitees") from and against any and all claims, demands, losses, judgments and liabilities (including liabilities for penalties) of whatsoever kind or nature, and to reimburse each Indemnitee for all costs and expenses, including reasonable attorneys' fees, growing out of or resulting from this Agreement or the exercise by any Indemnitee of any right or remedy granted to it hereunder or under any Interest Rate Hedging Agreement or under any other Loan Document (but excluding any claims, demands, losses, judgments and liabilities or expenses to the extent incurred by reason of gross negligence or willful misconduct of such Indemnitee).  If and to the extent that the obligations of the Borrower under this Section 5.1(a) are unenforceable for any reason, the Borrower hereby agrees to make the maximum contribution to the payment and satisfaction of such obligations which is permissible under applicable law.

(b)        Without limiting the application of Section 5.1(a) hereof, Borrower agrees to pay, or reimburse the Administrative Agent for any and all reasonable fees, costs and expenses of whatever kind or nature incurred in connection with the creation, preservation or protection of the Administrative Agent's Liens on, and security interest in, the Collateral, including, without limitation, all reasonable fees and taxes in connection with the recording or filing of instruments and documents in public offices, payment or discharge of any taxes or Liens upon or in respect of the Collateral, premiums for insurance with respect to the Collateral and all other reasonable fees, costs and expenses in connection with protecting, maintaining or preserving the Collateral and the Administrative Agent's interest therein, whether through judicial proceedings or otherwise, or in defending or prosecuting any actions, suits or proceedings arising out of or relating to the Collateral.

(c)        Without limiting the application of Section 5.1(a) or (b) hereof, Borrower agrees to pay, indemnify and hold each Indemnitee harmless from and against any loss, costs, damages and expenses which such Indemnitee may suffer, expend or incur in consequence of or growing out of any misrepresentation by Borrower in this Agreement, any Interest Rate Protection or Other Hedging Agreement, any other Loan Document or in any writing contemplated by or made or delivered pursuant to or in connection with this Agreement, any Interest Rate Protection or Other Hedging Agreement or any other Loan Document.

(d)        If and to the extent that the obligations of Borrower under this Section 5.1 are unenforceable for any reason, Borrower hereby agrees to make the maximum contribution to the payment and satisfaction of such obligations which is permissible under applicable law.

5.2              Indemnity Obligations Secured by Collateral; Survival.  Any amounts paid by any Indemnitee as to which such Indemnitee has the right to reimbursement shall constitute Obligations secured by the Collateral prior to the release of the Collateral pursuant to the terms hereof.  The indemnity obligations of Borrower contained in this Article V shall continue in full force and effect notwithstanding the full payment of all the Notes issued under the Credit Agreement, the termination of all Interest Rate Protection or Other Hedging Agreements and the payment of all other Obligations (but excluding any unasserted contingent and indemnification obligations which survive the termination hereof) and notwithstanding the discharge thereof.

ARTICLE VI
DEFINITIONS

The following terms shall have the meanings herein specified.  Such definitions shall be equally applicable to the singular and plural forms of the terms defined.

"Account" shall have the meaning provided in the Uniform Commercial Code.

"Administrative Agent" shall have the meaning provided in the first paragraph of this Agreement.

"Agent" shall have the meaning provided in the first WHEREAS clause of this Agreement.

"Agreement" shall mean this Amended and Restated Security Agreement as the same may be modified, supplemented, extended, renewed, replaced, restated or amended from time to time in accordance with its terms.

"Bank Creditor" shall have the meaning provided in the first paragraph of this Agreement.

"Borrower" shall have the meaning provided in the first paragraph of this Agreement.

"Chattel Paper" shall have the meaning provided in the Uniform Commercial Code.

"Class" shall have the meaning provided in Section 7.2 of this Agreement.

"Collateral" shall have the meaning provided in Section 1.1(a) of this Agreement.

"Contract Rights" shall mean all rights of Borrower (including, without limitation, all rights to payment) under each Contract.

"Contracts" shall mean all contracts between Borrower and one or more additional parties (including, without limitation, (i) each partnership agreement to which Borrower is a party and (ii) any Interest Rate Protection or Other Hedging Agreements), but excluding licenses, agreements and leases, which are immaterial to the operations of Borrower, to the extent that the terms thereof prohibit the assignment of, or granting of a security interest in, such licenses, agreements or leases.

"Copyrights" shall mean any United States copyright which Borrower now owns or hereafter acquires, including any registrations of any Copyrights in the United States Copyright Office, as well as any application for a United States copyright registration now or hereafter made with the United States Copyright Office by Borrower.

"Credit Agreement" shall have the meaning provided in the first WHEREAS clause of this Agreement.

"Credit Agreement Obligations" shall have the meaning provided in the definition of "Obligations" in this Article VI.

"Default" shall mean any event which, with notice or lapse of time, or both, would constitute an Event of Default.

"Deposit Accounts" shall have the meaning provided in the Uniform Commercial Code.

"Documents" shall have the meaning provided in the Uniform Commercial Code.

"Equipment" shall mean any "equipment," as such term is defined in the Uniform Commercial Code, now or hereafter owned by Borrower.

"Event of Default" shall mean any Event of Default under, and as defined in, the Credit Agreement and shall in any event, without limitation, include any payment default on any of the Obligations after the expiration of any applicable grace period.

"General Intangibles" shall have the meaning provided in the Uniform Commercial Code.

"Goods" shall have the meaning provided in the Uniform Commercial Code.

"Indemnitee" shall have the meaning provided in Section 5.1 of this Agreement.

"Instrument" shall have the meaning provided in Article 9 of the Uniform Commercial Code.

"Interest Rate Protection or Other Hedging Agreements" shall have the meaning provided in the first paragraph of this Agreement.

"Inventory" shall mean all "inventory" as such term is defined in the Uniform Commercial Code, now or hereafter owned by Borrower.

"Investment Property" shall have the meaning ascribed thereto in Article 9 of the UCC.

"LC Creditor" shall have the meaning provided in the first WHEREAS clause of this Agreement.

"Lenders" shall have the meaning provided in the first WHEREAS clause of this Agreement.

"Letter-of-Credit Rights" shall have the meaning provided in the Uniform Commercial Code.

"Marks" shall mean all right, title and interest in and to any trademarks and service marks and trade names now held or hereafter acquired by Borrower, which are registered in the United States Patent and Trademark Office or in any similar office or agency of the United States or any state thereof or any political subdivision thereof and any application for such trademarks and service marks, as well as any unregistered marks used by Borrower in the United States and trade dress including logos, designs, trade names, company names, business names, fictitious business names and other business identifiers in connection with which any of these registered or unregistered marks are used in the United States, but excluding all intent-to-use trademark applications for which an application to allege use under 15 U.S.C. §1051(c) and/or for which a statement of use under 15 U.S.C. §1051(d) has not been filed, which applications are identified in Annex D (III).

"Obligations" shall mean (i) the full and prompt payment when due (whether at the stated maturity, by acceleration or otherwise) of all obligations (including, without limitation, all "Obligations" as such term is defined in the Credit Agreement and all obligations which, but for the automatic stay under Section 362(a) of the Bankruptcy Code, would become due) and liabilities of Borrower now existing or hereafter incurred under, arising out of or in connection with the Credit Agreement or any other Loan Document to which Borrower is a Party and the due performance and compliance by Borrower with all of the terms, conditions and agreements contained in each such Loan Document (all such obligations and liabilities being herein collectively called the "Credit Agreement Obligations"); (ii) the full and prompt payment when due (whether at the stated maturity, by acceleration or otherwise) of all obligations (including obligations which, but for the automatic stay under Section 362(a) of the Bankruptcy Code, would become due) and liabilities of Borrower now existing or hereafter incurred under, arising out of or in connection with (x) any Interest Rate Protection or Other Hedging Agreement, whether such Interest Rate Protection or Other Hedging Agreement is now in existence or hereafter arising and the due performance and compliance by Borrower with all of the terms, conditions and agreements contained therein and (y) the US Bank Letter of Credit Facility up to a maximum amount of $2,000,000 (provided that at no time shall there be more than $2,000,000 under the US Bank Letter of Credit Facility secured by the Security Documents) (all such obligations and liabilities described in this clause (ii) being herein collectively called the "Other Obligations"); (iii) any and all sums advanced by the Administrative Agent in order to preserve the Collateral or preserve its security interest in the Collateral; (iv) in the event of any proceeding for the collection or enforcement of any indebtedness, obligations, or liabilities of Borrower referred to in clauses (i) and (ii), after an Event of Default shall have occurred and be continuing, the reasonable expenses of taking, holding, preparing for sale or lease, selling or otherwise disposing of or realizing on the Collateral, or of any exercise by the Administrative Agent of its rights hereunder, together with reasonable attorneys' fees and court costs; and (v) all amounts paid by any Indemnitee as to which such Indemnitee has the right to reimbursement under Section 6.1 of this Agreement.  It is acknowledged and agreed that the "Obligations" shall include extensions of credit of the types described above, whether outstanding on the date of this Agreement or extended from time to time after the date of this Agreement.

"Other Creditors" shall have the meaning provided in the first paragraph of this Agreement.

"Other Obligations" shall have the meaning provided in the definition of "Obligations" in this Article VI.

"Patents" shall mean any United States patent now or hereafter owned by Borrower, as well as any application for a United States patent now or hereafter owned by Borrower, but excluding patents and applications for patents that Borrower is prohibited by written contract from assigning or granting a security interest in.

"Permitted Filings" shall mean any filing or similar item that was a matter of public record on October 12, 2001, with respect to Collateral secured by the Original Security Agreement, or on the date hereof, with respect to any other Collateral.

"Primary Obligations" shall have the meaning provided in Section 4.4(b) of this Agreement.

"Pro Rata Share" shall have the meaning provided in Section 4.4(b) of this Agreement.

"Proceeds" shall have the meaning provided in the Uniform Commercial Code.

"Representative" shall have the meaning provided in Section 5.4(e) of this Agreement.

"Required Secured Creditors" shall mean (i) the Required Lenders (or, to the extent required by Article XI of the Credit Agreement, all of the Lenders) under the Credit Agreement so long as any Credit Agreement Obligations remain outstanding and (ii) in any situation not covered by preceding clause (i), the holders of a majority of the outstanding principal amount of the Other Obligations.

"Requisite Creditors" shall have the meaning provided in Section 7.2 of this Agreement.

"Secondary Obligations" shall have the meaning provided in Section 4.4(b) of this Agreement.

"Secured Creditors" shall have the meaning provided in the first paragraph of this Agreement.

"Termination Date" shall have the meaning provided in Section 7.9 of this Agreement.

"Trade Secrets" shall mean any know-how, technology, product formulations, procedures and product and manufacturing specifications or standards now or hereafter utilized by Borrower in Borrower's business.

"Uniform Commercial Code" or "UCC" shall mean the Uniform Commercial Code as now or hereafter in effect from time to time in the State of New York or any other applicable jurisdiction.

"US Bank Letter of Credit Facility" means that certain revolving letter of credit facility in effect on the date hereof pursuant to that certain Continuing Reimbursement Agreement for Commercial Letters of Credit, dated as of July 14, 2000 by and among the LC Creditor and the Borrower providing for commercial letters of credit; provided, however, that at no time shall there be more than a maximum amount of $2,000,000 under the US Bank Letter of Credit Facility secured by the Security Documents.

ARTICLE VII
MISCELLANEOUS

7.1&nb3p;             Notices.  All such notices and communications hereunder shall be sent or delivered in accordance with the terms of the Credit Agreement.

7.2              Waiver; Amendment.   None of the terms and conditions of this Agreement may be changed, waived, modified or varied in any manner whatsoever unless in writing duly signed by Borrower and the Administrative Agent (with the written consent of the Required Lenders, or to the extent required by Section 11.1 of the Credit Agreement, all the Lenders); provided, however, that any change, waiver, modification or variance affecting the rights and benefits of a single Class of Secured Creditors (and not all Secured Creditors in a like or similar manner) shall require the written consent of the Requisite Creditors of such affected Class.  For the purpose of this Agreement, the term "Class" shall mean each class of Secured Creditors, i.e., whether (i) the Bank Creditors as holders of the Credit Agreement Obligations or (ii) the Other Creditors as the holders of the Other Obligations; and the term "Requisite Creditors" of any Class shall mean each of (A) with respect to the Credit Agreement Obligations, the Required Lenders and (B) with respect to the Other Obligations, the holders of at least a majority of all obligations outstanding from time to time under the Interest Rate Protection Agreements or Other Hedging Agreements.

7.3              Obligations Absolute.   The obligations of Borrower hereunder shall remain in full force and effect without regard to, and shall not be impaired by, (a) any bankruptcy, insolvency, reorganization, arrangement, readjustment, composition, liquidation or the like of Borrower; (b) any exercise or non-exercise, or any waiver of, any right, remedy, power or privilege under or in respect of this Agreement, any other Loan Document or any Interest Rate Protection or Other Hedging Agreement except as specifically set forth in a waiver granted pursuant to Section 7.2 hereof; or (c) any amendment to or modification of any Loan Document or any Interest Rate Protection or Other Hedging Agreement or any security for any of the Obligations; whether or not Borrower shall have notice or knowledge of any of the foregoing.

7.4              Successors and Assigns.  This Agreement shall be binding upon the parties hereto and their respective successors and assigns and shall inure to the benefit of the Administrative Agent, each Secured Creditor and Borrower and their respective successors and assigns, provided that Borrower may not transfer or assign any or all of its rights or obligations hereunder without the written consent of the Required Secured Creditors.  All agreements, statements, representations and warranties made by Borrower herein or in any certificate or other instrument delivered by Borrower or on its behalf under this Agreement shall be considered to have been relied upon by the Secured Creditors and shall survive the execution and delivery of this Agreement, the other Loan Documents and the Interest Rate Protection or Other Hedging Agreements regardless of any investigation made by the Secured Creditors or on their behalf.

7.5              Headings Descriptive.   The headings of the several sections of this Agreement are inserted for convenience only and shall not in any way affect the meaning or construction of any provision of this Agreement.

7.6              Severability.   Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating 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.

7.7              GOVERNING LAW.   THIS AGREEMENT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER THE LAWS OF THE STATE OF NEW YORK, AND FOR ALL PURPOSES SHALL BE CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS AND DECISIONS OF SAID STATE, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW.

7.8              Borrower's Duties.   It is expressly agreed, anything herein contained to the contrary notwithstanding, that Borrower shall remain liable to perform all of the obligations, if any, assumed by it with respect to the Collateral and the Administrative Agent shall not have any obligations or liabilities with respect to any Collateral by reason of or arising out of this Agreement, nor shall the Administrative Agent be required or obligated in any manner to perform or fulfill any of the obligations of Borrower under or with respect to any Collateral.

7.9              Termination; Release.   (a)  After the Termination Date, this Agreement shall automatically terminate (provided that all indemnities set forth herein including, without limitation, in Section 5.1 hereof shall survive such termination) and the Administrative Agent, at the request and expense of Borrower, will execute and deliver to Borrower a proper instrument or instruments (including Uniform Commercial Code termination statements on form UCC-3) acknowledging the satisfaction and termination of this Agreement, and will duly assign, transfer and deliver to Borrower (without recourse and without any representation or warranty) such of the Collateral of Borrower and as has not theretofore been sold or otherwise applied or released pursuant to this Agreement.  As used in this Agreement, "Termination Date" shall mean the date upon which all Interest Rate Protection or Other Hedging Agreements have been terminated, no Note under the Credit Agreement is outstanding (and all Loans have been repaid in full), all Letters of Credit have been terminated and all Obligations (as defined in the Credit Agreement) then outstanding (other than any indemnities described in Section 5.1 hereof and in Section 11.4 of the Credit Agreement with respect to which no claim has been asserted) have been paid in full in cash.

(b)        In the event that any part of the Collateral is sold or otherwise disposed of in connection with a sale or other disposition permitted by Section 8.7 of the Credit Agreement or is otherwise released at the direction of the Required Lenders (or all the Lenders if required by Section 11.1 of the Credit Agreement) and the proceeds of such sale or sales or from such release are applied in accordance with the provisions of Section 4.4 of the Credit Agreement, to the extent required to be so applied, such Collateral will be sold free and clear of the Liens created by this Agreement and the Administrative Agent, at the request and expense of Borrower, will duly assign, transfer and deliver to Borrower (without recourse and without any representation or warranty) such of the Collateral as is then being (or has been) so sold or released and has not theretofore been released pursuant to this Agreement.  The Administrative Agent shall also be entitled to and is hereby authorized and directed to duly assign, transfer and deliver such of the Collateral as provided in Section 11.20(b) of the Credit Agreement.

(c)        At any time that Borrower desires that the Administrative Agent take any action to acknowledge or give effect to any release of Collateral pursuant to the foregoing Section 7.9(a) or (b), as the case may be, it shall deliver to the Administrative Agent a certificate signed by an Authorized Officer stating that the release of the respective Collateral is permitted pursuant to Section 7.9(a) or (b), as the case may be.

(d)        The Administrative Agent shall have no liability whatsoever to any Secured Creditor as a result of any release of Collateral by it in accordance with this Section 7.9.

7.10          Counterparts.  This Agreement may be executed in any number of counterparts and by the different parties hereto on separate counterparts, each of which when so executed and delivered shall be an original, but all of which shall together constitute one and the same instrument.  A set of counterparts executed by all the parties hereto shall be lodged with Borrower and the Administrative Agent.

7.11          The Administrative Agent.  The Administrative Agent will hold in accordance with this Agreement all items of the Collateral at any time received under this Agreement.  It is expressly understood and agreed by the parties hereto and each Secured Creditor, by accepting the benefits of this Agreement, acknowledges and agrees that the obligations of the Administrative Agent as holder of the Collateral and interests therein and with respect to the disposition thereof, and otherwise under this Agreement, are only those expressly set forth in this Agreement and as provided in the Uniform Commercial Code in the State of New York.   The Administrative Agent shall act hereunder on the terms and conditions set forth in Article IX and Section 11.18 of the Credit Agreement.

7.12          US Bank.  (a) US Bank as LC Creditor under the US Bank Letter of Credit Facility and in its capacity as a Secured Party hereunder hereby irrevocably designates and appoints Bankers Trust Company as Administrative Agent under this Agreement and irrevocably authorizes Bankers Trust Company to act as its Administrative Agent and to take such action on its behalf under the provisions of this Agreement and to exercise such powers and perform such duties as are expressly delegated to the Administrative Agent under this Agreement and the Loan Documents, together with such other powers as are reasonably incidental thereto.  Notwithstanding any provision to the contrary in this Agreement, the Administrative Agent shall not have any duties or responsibilities with respect to US Bank in its capacity LC Creditor under the US Bank Letter of Credit Facility or any fiduciary relationship with US Bank, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this Agreement or otherwise exist against the Administrative Agent.

            (b)        For avoidance of doubt, US Bank expressly acknowledges that all rights and remedies of the Administrative Agent hereunder shall be exercised by the Administrative Agent in accordance with the applicable provisions of the Credit Agreement, and no consent of, or notice to, US Bank shall be required with respect thereto and US Bank shall not undertake any separate action with respect to the Collateral.  The sole right of US Bank hereunder shall be to receive its proportionate share of any proceeds received by the Administrative Agent hereunder in accordance with the terms hereof.

7.13          Amended and Restated.   This Agreement amends and restates the Original Security Agreement and is not in satisfaction of payment of any obligations thereunder and does not constitute a novation of the Original Security Agreement but rather shall relate back to the time of the Original Security Agreement for the purposes of filing and perfection.

ARTICLE VIII
SPECIAL PROVISIONS CONCERNING ACCOUNTS; CONTRACT RIGHTS; INSTRUMENTS

8.1              Additional Representations and Warranties.  As of the time when each of its Accounts arises, Borrower shall be deemed to have represented and warranted that such Account, and all records, papers and documents of Borrower relating thereto (if any) are genuine and in all material respects what they purport to be, and that all papers and documents of Borrower (if any) relating thereto to the best knowledge of Borrower (i) will represent the genuine, legal, valid and binding obligation of the account debtor evidencing indebtedness unpaid and owed by the respective account debtor arising out of the performance of labor or services or the sale or lease and delivery of the merchandise listed therein, or both, (ii) will be the only original writings of Borrower evidencing and embodying such obligation of the account debtor named therein (other than copies created for general accounting purposes), (iii) will evidence true and valid obligations, enforceable in accordance with their respective terms subject to applicable bankruptcy, insolvency, reorganization, moratorium and general principles of equityand (iv) will be in material compliance and will conform in all material respects with all applicable federal, state and local laws and applicable laws of any relevant foreign jurisdiction.

8.2              Maintenance of Records.  Borrower will keep and maintain at its own cost and expense accurate and complete records of its Accounts and Contracts, including, but not limited to, records of all payments received, all credits granted thereon, all merchandise returned and all other dealings therewith, and Borrower will make the same available on Borrower's premises to the Administrative Agent for inspection, at Borrower's own cost and expense (not to exceed reasonable costs and expenses), at any and all reasonable times upon prior notice to an Responsible Officer of Borrower.  At the request of the Administrative Agent and upon the occurrence and during the continuance of an Event of Default, Borrower shall, at its own cost and expense, deliver all tangible evidence of its Accounts and Contract Rights (including, without limitation, all documents evidencing the Accounts and all Contracts) and such books and records to the Administrative Agent or to its representatives (copies of which evidence and books and records may be retained by Borrower).  Upon the occurrence and during the continuance of an Event of Default, if the Administrative Agent so directs, Borrower shall legend, in form and manner reasonably satisfactory to the Administrative Agent, the Accounts and the Contracts, as well as books, records and documents of Borrower evidencing or pertaining to such Accounts and Contracts with an appropriate reference to the fact that the Administrative Agent and that the Administrative Agent has a security interest therein.

8.3              Modification of Terms; etc.  Borrower shall not rescind or cancel any indebtedness evidenced by any Account or under any Contract, or modify any term relating to such indebtedness or make any adjustment with respect thereto, or extend or renew the same, or compromise or settle any material dispute, claim, suit or legal proceeding relating thereto, or sell any Account or Contract, or interest therein, without the prior written consent of the Administrative Agent (not to be unreasonably withheld or delayed), except as permitted by Section 8.4 hereof or the Credit Agreement.   Borrower will duly fulfill in all material respects all obligations on its part to be fulfilled under or in connection with the Accounts and Contracts and will do nothing to impair the rights of the Administrative Agent in the Accounts or Contracts.

8.4              Collection.   Borrower shall endeavor to cause to be collected from the account debtor named in each of its Accounts or obligor under any Contract, as and when due (including, without limitation, amounts which are delinquent, such amounts to be collected in accordance with sound business judgement) any and all amounts owing under or on account of such Account or Contract, and apply forthwith upon receipt thereof all such amounts as are so collected to the outstanding balance of such Account or under such Contract, except that, unless an Event of Default has occurred and is continuing, Borrower may allow in the ordinary course of business as adjustments to amounts owing under its Accounts and Contracts (i) an extension or renewal of the time or times of payment, or settlement for less than the total unpaid balance, which Borrower finds appropriate in accordance with sound business judgment and (ii) a refund or credit due as a result of returned or damaged merchandise or improperly performed services or for other reasons which Borrower finds appropriate in accordance with sound business judgment.  The reasonable costs and expenses (including, without limitation, reasonable attorneys' fees) of collection, whether incurred by Borrower or the Administrative Agent, shall be borne by Borrower.

8.5              Instruments.  If Borrower owns or acquires any Instrument constituting Collateral, Borrower will within 15 days notify the Administrative Agent thereof, and upon request by the Administrative Agent will promptly deliver such Instrument to the Administrative Agent appropriately endorsed to the order of the Administrative Agent as further security hereunder.

8.6              Further Actions.   Borrower will, at its own expense, make, execute, endorse, acknowledge, file and/or deliver to the Administrative Agent from time to time such vouchers, invoices, schedules, confirmatory assignments, conveyances, financing statements, transfer endorsements, powers of attorney, certificates, reports and other assurances or instruments and take such further steps relating to its Accounts, Contracts, Instruments and other property or rights covered by the security interest hereby granted, as the Administrative Agent may reasonably require.

ARTICLE IX
SPECIAL PROVISIONS CONCERNING MARKS

9.1              Additional Representations and Warranties.  Borrower represents and warrants that it is the true and lawful exclusive owner of or otherwise has the right to use the Marks listed in Annex D(I) and D(II) hereto for Borrower and that said listed Marks include all the United States federal trademark registrations or applications registered in the United States Patent and Trademark Office.  Borrower represents and warrants that it owns or is licensed to use or is not prohibited from using all Marks that it uses.  Borrower further warrants that, except as set forth in Annex D(IV), it is aware of no third party claim that any aspect of Borrower's present or contemplated business operations infringes or will infringe any Mark.  Borrower represents and warrants that it is the owner of record of or otherwise has the right to use all United States registrations and applications listed in Annex D(I) and D(II) hereto and that said registrations are valid, subsisting, have not been canceled and that, except as set forth in Annex D(IV), Borrower is not aware of any third-party claim that any of said registrations is invalid or unenforceable.  Borrower hereby grants to the Administrative Agent an absolute power of attorney to sign, upon the occurrence and during the continuance of an Event of Default, any document which may be required by the United States Patent and Trademark Office in order to effect an absolute assignment of all right, title and interest in each Mark and associated goodwill, and record the same.

9.2              Licenses and Assignments.  Other than the license agreements listed on Annex E hereto and any extensions or renewals thereof, Borrower hereby agrees not to divest itself of any right under any Mark absent prior written approval of the Administrative Agent (which shall not be unreasonably withheld or delayed), except that Borrower may license any of its rights in such a Mark in the ordinary course of business provided that such license does not materially interfere with the business of Borrower.

9.3              Infringements.   Borrower agrees, promptly upon learning thereof, to notify the Administrative Agent in writing of the name and address of, and to furnish such pertinent information that may be available with respect to (except for any privileged communication), any party who may be infringing or otherwise violating any of Borrower's rights in and to any Mark to the extent that Borrower reasonably believes that such infringement or violation is material to its business, or with respect to any party claiming that Borrower's use of any Mark violates any property right of that party.  Borrower further agrees, if consistent with good business practice and unless otherwise agreed by the Administrative Agent, to diligently prosecute any Person infringing any Mark to the extent that Borrower reasonably believes that such infringement is material to its business.

9.4              Preservation of Marks.   Borrower agrees to use its Marks in interstate commerce during the time in which this Agreement is in effect, sufficiently to preserve such Marks as trademarks or service marks registered under the laws of the United States; provided that, to the extent permitted by the Credit Agreement, Borrower shall not be obligated to preserve any Mark in the event Borrower determines, in its reasonable business judgment, that the preservation of such Mark is no longer desirable in the conduct of its business.

9.5              Maintenance of Registration.  Borrower shall, at its own expense, diligently process all documents required by the Trademark Act of 1946, 15 U.S.C. §§ 1051 et seq. to maintain trademark registrations, including but not limited to affidavits of use and applications for renewals of registration in the United States Patent and Trademark Office for all of its Marks pursuant to 15 U.S.C. §§ 1058(a), 1059 and 1065, and shall pay all fees and disbursements in connection therewith and shall not abandon any such filing of affidavit of use or any such application of renewal prior to the exhaustion of all reasonable administrative and judicial remedies without prior written consent of the Administrative Agent (which consent will not be unreasonably withheld or delayed) except if, in its reasonable business judgment, such action is no longer desirable in the conduct of its business.

9.6              Future Registered Marks.  If any Mark registration issues hereafter to Borrower as a result of any application now or hereafter pending before the United States Patent and Trademark Office, within 60 days of receipt of such certificate, Borrower shall deliver to the Administrative Agent a copy of such certificate, and a grant of security in such Mark to the Administrative Agent, confirming the grant thereof hereunder, the form of such confirmatory grant to be substantially the same as the form hereof.

9.7              Remedies.  If an Event of Default shall occur and be continuing, the Administrative Agent may, by written notice to Borrower, take any or all of the following actions:  (i) declare the entire right, title and interest of Borrower in and to each of its Marks together with the goodwill of the business associated therewith, together with all trademark rights and rights of protection to the same, vested in the Administrative Agent for the benefit of the Secured Creditors, in which event such rights, title and interest shall immediately vest, in the Administrative Agent for the benefit of the Secured Creditors, in which case the Administrative Agent shall be entitled to exercise the power of attorney referred to in Section 9.1 to execute, cause to be acknowledged and notarized and record said absolute assignment with the applicable agency; (ii) take and use or sell the Marks together with the goodwill of Borrower's business symbolized by the Marks and the right to carry on the business and use the assets of Borrower in connection with which the Marks have been used; and (iii) direct Borrower to refrain, in which event Borrower shall refrain, from using the Marks in any manner whatsoever, directly or indirectly, and, if requested by the Administrative Agent, change Borrower's corporate name to eliminate therefrom any use of any Mark and execute such other and further documents that the Administrative Agent may request to further confirm this and to transfer ownership of the Marks and any registrations and any trademark application in the United States Patent and Trademark Office or any equivalent government agency or office in any foreign jurisdiction to the Administrative Agent.

ARTICLE X
SPECIAL PROVISIONS CONCERNING PATENTS AND COPYRIGHTS AND TRADE SECRETS

10.1          Additional Representations and Warranties.  Borrower represents and warrants that it is the true and lawful exclusive owner of or otherwise has the right to use (i) all material Trade Secrets necessary to operate the business of Borrower, (ii) the Patents listed in Annex F hereto for Borrower and (iii) the Copyrights listed in Annex G hereto for Borrower, that to the best of its knowledge said Patents include all the United States patents and applications for United States patents that Borrower now owns or otherwise has the right to use (except for any patent that Borrower does not have the right to assign or grant a security interest in) and that said Copyrights constitute all the United States copyrights registered with the United States Copyright Office and applications for United States copyrights that Borrower now owns or otherwise has the right to use and that in each case are necessary in the conduct of the business of Borrower.  Borrower represents and warrants that it owns or is licensed to practice under all Patents and Copyrights that it now uses or practices under.  Borrower further warrants that, except as set forth in Schedule F(I), it is aware of no third party claim that any aspect of Borrower's present or contemplated business operations infringes or will infringe any patent or any copyright or Borrower has misappropriated any Trade Secrets or proprietary information.   Borrower hereby grants to the Administrative Agent an absolute power of attorney to sign, upon the occurrence and during the continuance of any Event of Default, any document which may be required by the United States Patent and Trademark Office or the United States Copyright Office in order to effect an absolute assignment of all right, title and interest in each Patent and Copyright, and record the same.

10.2          Licenses and Assignments.  Other than the license agreements listed on Annex E hereto and any extensions or renewals thereof, Borrower hereby agrees not to divest itself of any right under any Patent or Copyright absent prior written approval of the Administrative Agent except that Borrower may license any of its rights to such Patent or Copyright in the ordinary course of business provided that such license does not materially interfere with the business of Borrower or any Subsidiary consistent with past practices or as is consistent with its existing licensing strategy.

10.3          Infringements.   Borrower agrees, promptly upon learning thereof, to furnish the Administrative Agent in writing with all pertinent information (except for any privileged information) available to Borrower with respect to any infringement or other violation of Borrower's rights in and to any Patent or Copyright to the extent that Borrower reasonably believes that such infringement or violation is material to its business, or with respect to any claim that practice of any Patent or Copyright violates any property right of a third party, or with respect to any misappropriation of any Trade Secret by Borrower or any claim that Borrower's practice of any Trade Secret violates any property right of a third party.  Borrower further agrees, consistent with good business practice and absent direction of the Administrative Agent to the contrary, diligently to prosecute any Person infringing any Patent or Copyright or any Person misappropriating any of such Borrower's Trade Secrets to the extent that Borrower reasonably believes that such infringement or misappropriation is material to its business.

10.4          Maintenance of Patents.  At its own expense, Borrower shall make timely payment of all post-issuance fees required pursuant to 35 U.S.C. § 41 to maintain in force rights under each Patent except if, in its reasonable business judgment, such maintenance of such Patent is no longer desirable in the conduct of its business.

10.5          Prosecution of Patent Application.  At its own expense, Borrower shall diligently prosecute all applications for Patents listed in Annex F hereto for Borrower and shall not abandon any such application prior to exhaustion of all reasonable administrative and judicial remedies, absent written consent of the Administrative Agent; provided, however, that to the extent permitted by the Credit Agreement, Borrower shall not be obligated to prosecute any application in the event Borrower determines, in its reasonable business judgment, that the prosecuting of such application is no longer necessary or desirable in the conduct of its business.

10.6          Other Patents and Copyrights.  Within 60 days of its acquisition of a Patent or Copyright, or of its filing of an application for a Patent or Copyright, Borrower shall deliver to the Administrative Agent a copy of said Patent or Copyright or such application, as the case may be, with a grant of security as to such Patent or Copyright, as the case may be, confirming the grant thereof hereunder, the form of such confirmatory grant to be substantially the same as the form hereof.

10.7          Remedies.  If an Event of Default shall occur and be continuing, the Administrative Agent may by written notice to Borrower, take any or all of the following actions:  (i) declare the entire right, title, and interest of Borrower in each of the Patents and Copyrights vested in the Administrative Agent for the benefit of the Secured Creditors, in which event such right, title, and interest shall immediately vest in the Administrative Agent for the benefit of the Secured Creditors, in which case the Administrative Agent shall be entitled to exercise the power of attorney referred to in Section 10.1 hereof to execute, cause to be acknowledged and notarized and record said absolute assignment with the applicable agency; (ii) take and practice or sell the Patents and Copyrights; and (iii) direct Borrower to refrain, in which event Borrower shall refrain, from practicing the Patents and using the Copyrights directly or indirectly, and Borrower shall execute such other and further documents as the Administrative Agent may request further to confirm this and to transfer ownership of the Patents and Copyrights to the Administrative Agent for the benefit of the Secured Creditors.

[Signature Page Follows]

                        IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed and delivered by their duly authorized officers as of the date first above written.

BMC INDUSTRIES, INC.,
as Borrower

By:  /s/ Bradley D. Carlson

Name:  Bradley D. Carlson

Title:  Treasurer

DEUTSCHE BANK TRUST COMPANY AMERICAS (formerly named Bankers Trust Company),
as Administrative Agent

By:  /s/ Mary Jo Jolly

Name:  Mary Jo Jolly

Title:  Assistant Vice President

U.S. BANK NATIONAL ASSOCIATION

By:  /s/ Nicholas G. Myers

Name:  Nicholas G. Myers

Title:  Assistant Vice President

EX-10.47

TABLE OF CONTENTS

ARTICLE I SECURITY INTERESTS			2
	1.1	Grant of Security Interests	2
	1.2	Power of Attorney	3
ARTICLE II GENERAL REPRESENTATIONS, WARRANTIES AND COVENANTS			3
	2.1	Chief Executive Office/Inventory and Equipment Locations	3
	2.2	State of Incorporation	3
	2.3	Trade Names; Change of Name	4
ARTICLE III PROVISIONS CONCERNING ALL COLLATERAL			5
	3.1	Protection of Administrative Agent's Security	5
	3.2	Warehouse Receipts Non-Negotiable; Third-Party Acknowledgments	5
	3.3	Further Actions	5
	3.4	Financing Statements	5
ARTICLE IV REMEDIES UPON OCCURRENCE OF EVENT OF DEFAULT			5
	4.1	Remedies; Obtaining the Collateral Upon Default	5
	4.2	Remedies; Disposition of the Collateral	7
	4.3	Waiver of Claims	7
	4.4	Application of Proceeds	8
	4.5	Remedies Cumulative	10
	4.6	Discontinuance of Proceedings	11
ARTICLE V INDEMNITY			11
	5.1	Indemnity	11
	5.2	Indemnity Obligations Secured by Collateral; Survival	12
ARTICLE VI DEFINITIONS			12
ARTICLE VII MISCELLANEOUS			16
	7.1	Notices	16
	7.2	Waiver; Amendment	16
	7.3	Obligations Absolute	17
	7.4	Successors and Assigns	17
	7.5	Headings Descriptive	17
	7.6	Severability	17
	7.7	GOVERNING LAW	17
	7.8	Each Guarantor's Duties	17
	7.9	Termination; Release	18
	7.10	Counterparts	18
	7.11	The Administrative Agent	19
	7.12	US Bank	19
	7.13	Additional Guarantors	19
	7.14	Amended and Restated	19
ARTICLE VIII SPECIAL PROVISIONS CONCERNING ACCOUNTS; CONTRACT RIGHTS;  INSTRUMENTS			20
	8.1	Additional Representations and Warranties	20
	8.2	Maintenance of Records	20
	8.3	Modification of Terms; etc	20
	8.4	Collection	21
	8.5	Instruments	21
	8.6	Further Actions	21
ARTICLE IX SPECIAL PROVISIONS CONCERNING MARKS			21
	9.1	Additional Representations and Warranties	21
	9.2	Licenses and Assignments	22
	9.3	Infringements	22
	9.4	Preservation of Marks	22
	9.5	Maintenance of Registration	22
	9.6	Future Registered Marks	22
	9.7	Remedies	23
ARTICLE X SPECIAL PROVISIONS CONCERNING PATENTS AND COPYRIGHTS AND TRADE SECRETS			23
	10.1	Additional Representations and Warranties	23
	10.2	Licenses and Assignments	24
	10.3	Infringements	24
	10.4	Maintenance of Patents	24
	10.5	Prosecution of Patent Application	24
	10.6	Other Patents and Copyrights	24
	10.7	Remedies	24

ANNEX A	Schedule of Chief Executive Offices
ANNEX B	Schedule of Inventory and Equipment Locations
ANNEX C	Schedule of Trade, Fictitious and Other Names
ANNEX D	Schedule of Marks
ANNEX E	Schedule of License Agreements and Assignments
ANNEX F	Schedule of Patents and Copyrights
ANNEX G	Schedule of Copyrights and Applications
ANNEX H	Assignment of Security Interest in U.S. Trademarks and Patents
ANNEX I	Assignment of Security Interest in U.S. Copyrights

      xxx

AMENDED AND RESTATED

SUBSIDIARY GUARANTOR SECURITY AGREEMENT

between

VISION-EASE LENS, INC.,

VISION-EASE LENS AZUSA, INC.,

DEUTSCHE BANK TRUST COMPANY AMERICAS
(formerly named Bankers Trust Company),
as Administrative Agent

and

U.S. BANK NATIONAL ASSOCIATION

Dated as of September 27, 2002

AMENDED AND RESTATED SUBSIDIARY GUARANTOR SECURITY AGREEMENT

THIS AMENDED AND RESTATED SUBSIDIARY GUARANTOR SECURITY AGREEMENT (this "Agreement"), dated as of September 27, 2002, is among the undersigned (each a "Guarantor" and, together with any other entity that becomes party hereto pursuant to Section 7.13 hereof, collectively, the "Guarantors"), DEUTSCHE BANK TRUST COMPANY AMERICAS (formerly named Bankers Trust Company), as administrative agent (the "Administrative Agent") and U.S. BANK NATIONAL ASSOCIATION ("US Bank") for the benefit of (i) the Lenders and the Agent under the Credit Agreement hereinafter referred to (such Lenders and the Agent are hereinafter called the "Bank Creditors"), (ii) if one or more Lenders (or any Affiliate thereof) enter into one or more (A) interest rate protection agreements (including, without limitation, interest rate swaps, caps, floors, collars and similar agreements), (B) foreign exchange contracts, currency swap agreements or other similar agreements or arrangements designed to protect against the fluctuations in currency values and/or (C) other types of hedging agreements from time to time (collectively, the "Interest Rate Protection or Other Hedging Agreements") with, or guaranteed by, Borrower, any such Lender or Lenders or any Affiliate of such Lender or Lenders (even if the respective Lender subsequently ceases to be a Lender under the Credit Agreement for any reason) so long as any such Lender or Affiliate participates in the extension of such Interest Rate Protection or Other Hedging Agreements and their subsequent assigns, if any (collectively, the "Other Creditors") and (iii) US Bank as lender under the US Bank Letter of Credit Facility (as defined below) (the "LC Creditor" and, together with the Other Creditors and the Bank Creditors, hereinafter called the "Secured Creditors").  Except as otherwise defined herein, terms used herein and defined in the Credit Agreement (as hereinafter defined) shall be used herein as so defined.

W I T N E S S E T H :

WHEREAS, BMC Industries, Inc. (the "Borrower"), the financial institutions (the "Lenders") from time to time party thereto and Bankers Trust Company, as Administrative Agent (together with any successor agent, the "Agent"), have entered into an Amended and Restated Credit Agreement, dated as of June 25, 1998, providing for the making of Loans and the issuance of, and participation in, Letters of Credit as contemplated therein (as used herein, the term "Credit Agreement" means the Credit Agreement described above in this paragraph, as in effect on the date hereof and as amended by that certain Second Amendment and Restatement Agreement dated as of October 12, 2001 and as amended and restated by that certain Third Amended and Restated Credit Agreement dated as of the date hereof, as the same may be amended, modified, extended, renewed, replaced, restated or supplemented from time to time, and including any agreement extending the maturity of or restructuring of all or any portion of the Indebtedness under such agreement or any successor agreements);

WHEREAS, Borrower may at any time and from time to time enter into, or guarantee, one or more Interest Rate Protection or Other Hedging Agreements with one or more Other Creditors;

WHEREAS, Borrower, Administrative Agent and US Bank previously entered into a Security Agreement dated as of October 12, 2001 (the "Original Security Agreement");

WHEREAS, it is a condition precedent to each of the above-described extensions of credit that Borrower shall have executed and delivered this Agreement which shall amend and restate the Original Security Agreement in its entirety; and

WHEREAS, pursuant to the Amended and Restated Subsidiary Guarantee Agreement, dated October 12, 2001, each Guarantor has jointly and severally guaranteed to the Secured Creditors the payment when due of certain obligations of Borrower and each Guarantor under or with respect to the Loan Documents, the Interest Rate Protection or Other Hedging Agreements and the US Bank Letter of Credit Facility (provided that at no time shall there be more than $2,000,000 under the US Bank Letter of Credit Facility secured by the Security Documents);

WHEREAS, each Guarantor desires to enter into this Agreement in order to satisfy the condition described in the preceding paragraph;

NOW, THEREFORE, in consideration of the extensions of credit to be made to Borrower and other benefits accruing to each Guarantor, the receipt and sufficiency of which are hereby acknowledged, each Guarantor hereby makes the following representations and warranties to the Administrative Agent for the benefit of the Secured Creditors and hereby covenants and agrees with the Administrative Agent for the benefit of the Secured Creditors as follows:

ARTICLE I
SECURITY INTERESTS

1.1              Grant of Security Interests.  (a)  As security for the prompt and complete payment and performance when due of all of the Obligations, each Guarantor does hereby pledge and grant to the Administrative Agent for the benefit of the Secured Creditors, a continuing security interest of first priority (subject to Liens evidenced by Permitted Filings and other Permitted Liens) in, all of the right, title and interest of such Guarantor in, to and under all of the following, whether now existing or hereafter from time to time acquired:  (i) each and every Account, (ii) all Contracts, together with all Contract Rights arising thereunder, (iii) all Inventory, (iv) all Equipment, (v) Marks, together with the registrations and right to all renewals thereof, and the goodwill of the business of such Guarantor symbolized by the Marks, (vi) all Patents and Copyrights, and all reissues, renewals or extensions thereof, (vii) all computer programs of such Guarantor and all intellectual property rights therein and all other proprietary information of such Guarantor, including, but not limited to, Trade Secrets, (viii) all other Goods, General Intangibles, Chattel Paper, Documents, Investment Property and Instruments, and (ix) policies now or at any time hereafter in the possession or under control of such Guarantor or its respective bailees and any interest therein, (xii) all vehicles, aircraft, vessels, barges, railcars, rolling stock and fixtures owned by such Guarantor, together with accessions thereto and replacement parts therefor, and (xiii) all Proceeds and products of any and all of the foregoing (all of the above, collectively, the "Collateral").

(b)  The security interests of the Administrative Agent under this Agreement extend to all Collateral of the kind which is the subject of this Agreement which any Guarantor may acquire at any time during the continuation of this Agreement.

1.2              Power of Attorney.   Each Guarantor hereby constitutes and appoints the Administrative Agent its true and lawful attorney, with full power after the occurrence of and during the continuance of an Event of Default (in the name of such Guarantor or otherwise), in the Administrative Agent's reasonable discretion, to take any action and to execute any instrument required by this Agreement if such Guarantor has failed to do so after demand by the Administrative Agent.

ARTICLE II
GENERAL REPRESENTATIONS, WARRANTIES AND COVENANTS

Each Guarantor represents, warrants and covenants, which representations, warranties and covenants shall survive execution and delivery of this Agreement, as follows:

2.1              Chief Executive Office/Inventory and Equipment Locations.  The chief executive office of such Guarantor is located at the address indicated on Annex A hereto.  All Inventory and Equipment held on the date hereof by such Guarantor is located at one of the locations shown on Annex B hereto (other than (i) immaterial portions of Inventory or Equipment or (ii) Equipment out for repair).    Prior to January 1, 2002, such Guarantor shall not (x) move its chief executive office to any of the States of Mississippi, Alabama or Florida, or (y) move any Inventory or Equipment to any of the States of Mississippi, Alabama or Florida until (i) it shall have given to the Administrative Agent not less than 30 days' prior written notice of its intention to do so, (ii) with respect to such move, it shall have taken all action, reasonably satisfactory to the Administrative Agent, to maintain the security interest of the Administrative Agent in the Collateral intended to be granted and perfected under the Uniform Commercial Code hereby at all times fully perfected and in full force and effect, (iii) at the reasonable request of the Administrative Agent, it shall have furnished a customary opinion of counsel reasonably acceptable to the Administrative Agent to the effect that all financing or continuation statements and amendments or supplements thereto have been filed in the appropriate filing office or offices, and all other actions (including, without limitation, the payment of all filing fees and taxes, if any, payable in connection with such filings) have been taken, in order to perfect (and maintain the perfection and priority of) the security interest granted hereby and (iv) the Administrative Agent shall have received evidence that all other actions (including, without limitation, the payment of all filing fees and taxes, if any, payable in connection with such filings) have been taken, in order to perfect (and maintain the perfection and priority of) the security interest granted hereby.

2.2              State of Incorporation.  The state of incorporation of each Guarantor is indicated on Annex A hereto.  No Guarantor will change its state of incorporation except as in accordance with the last sentence of this Section 2.2.  No Guarantor shall establish a new state of incorporation until (i) it shall have given to the Administrative Agent not less than 30 days' prior written notice of its intention to do so, clearly describing such new state of incorporation and providing such other information in connection therewith as the Administrative Agent may reasonably request, (ii) with respect to such new state of incorporation, it shall have taken all action, reasonably satisfactory to the Administrative Agent, to maintain the security interest of the Administrative Agent in the Collateral intended to be granted and perfected under the Uniform Commercial Code hereby at all times fully perfected and in full force and effect, (iii) at the reasonable request of the Administrative Agent, it shall have furnished a customary opinion of counsel reasonably acceptable to the Administrative Agent to the effect that all financing or continuation statements and amendments or supplements thereto have been filed in the appropriate filing office or offices, and all other actions (including, without limitation, the payment of all filing fees and taxes, if any, payable in connection with such filings) have been taken, in order to perfect (and maintain the perfection and priority of) the security interest granted hereby and (iv) the Administrative Agent shall have received evidence that all other actions (including, without limitation, the payment of all filing fees and taxes, if any, payable in connection with such filings have been taken, in order to perfect (and maintain the perfection and priority of) the security interest granted hereby.

2.3              Trade Names; Change of Name.  No Guarantor operates in any jurisdiction under, nor in the preceding 12 months has operated in any jurisdiction under, any trade names, fictitious names or other names (including, without limitation, any names of divisions or operations) except its legal name and such other trade, fictitious or other names as are listed on Annex C hereto.  The corporation identification number or other applicable formation identification number shall be set forth across from the exact legal name of each Guarantor identified in Annex C.  No Guarantor shall change its legal name or assume or operate in any jurisdiction under any trade, fictitious or other name in any manner which might make any financing statement or continuation statement filed in connection therewith seriously misleading except those names listed on Annex C hereto and new names (including, without limitation, any names of divisions or operations) established in accordance with the last sentence of this Section 2.3.  No Guarantor shall assume or operate in any jurisdiction under any new trade, fictitious or other name that would make any financing statement or continuation statement filed in connection therewith, seriously misleading until (i) it shall have given to the Administrative Agent not less than 30 days' prior written notice of its intention so to do, clearly describing such new name and the jurisdictions in which such new name shall be used and providing such other information in connection therewith as the Administrative Agent may reasonably request, (ii) with respect to such new name, it shall have taken all action to maintain the security interest of the Administrative Agent in the Collateral intended to be granted hereby at all times fully perfected and in full force and effect, (iii) at the reasonable request of the Administrative Agent, it shall have furnished a customary opinion of counsel reasonablyacceptable to the Administrative Agent to the effect that all financing or continuation statements and amendments or supplements thereto have been filed in the appropriate filing office or offices, and (iv) the Administrative Agent shall have received evidence that all other actions (including, without limitation, the payment of all filing fees and taxes, if any, payable in connection with such filings) have been taken, in order to perfect (and maintain the perfection and priority of) the security interest granted hereby.

ARTICLE III
PROVISIONS CONCERNING ALL COLLATERAL

3.1              Protection of Administrative Agent's Security.  No Guarantor will do anything to impair the rights of the Administrative Agent in the Collateral other than dispositions, the creation of Liens and other encumbrances and other actions permitted hereunder and under the Credit Agreement and other Loan Documents.  

3.2              Warehouse Receipts Non-Negotiable; Third-Party Acknowledgments.  Each Guarantor agrees that if any warehouse receipt or receipt in the nature of a warehouse receipt is issued with respect to any of its Inventory, such warehouse receipt or receipt in the nature thereof shall not be "negotiable" (as such term is used in Section 7-104 of the Uniform Commercial Code as in effect in any relevant jurisdiction or under other relevant law).  Where Collateral with a fair market value of greater than $100,000 is in the possession of a third party, each Guarantor will promptly notify Administrative Agent of the occurrence of any such fact and will join with the Administrative Agent in notifying the third party of the Administrative Agent's security interest and obtaining an acknowledgment from the third party that it is holding the Collateral for the benefit of the Administrative Agent.

3.3              Further Actions.   Each Guarantor will, at its own expense, make, execute, endorse, acknowledge, file and/or deliver to the Administrative Agent from time to time such lists, descriptions and designations of its Collateral, warehouse receipts, receipts in the nature of warehouse receipts, bills of lading, documents of title, vouchers, invoices, schedules, confirmatory assignments, conveyances, financing statements, transfer endorsements, powers of attorney, certificates, reports and other assurances or instruments and take such further steps relating to the Collateral and other property or rights covered by the security interest hereby granted, which the Administrative Agent deems reasonably appropriate or advisable to perfect, preserve or protect its security interest in the Collateral.  

3.4              Financing Statements.   Each Guarantor agrees to deliver to the Administrative Agent such financing statements, in form reasonably acceptable to the Administrative Agent, as the Administrative Agent may from time to time reasonably request or as are reasonably  necessary (or desirable in the reasonable opinion of the Administrative Agent) to establish and maintain a valid, enforceable, first priority perfected security interest (subject only to Permitted Liens) in the Collateral as provided herein and the other rights and security contemplated hereby all in accordance with the Uniform Commercial Code as enacted in any and all relevant jurisdictions or any other relevant law.  Each Guarantor will pay any applicable filing fees, recordation taxes and related expenses relating to its Collateral.  Each Guarantor hereby authorizes the Administrative Agent to file any such Uniform Commercial Code financing statements without the signature of such Guarantor where permitted by law.

ARTICLE IV
REMEDIES UPON OCCURRENCE OF EVENT OF DEFAULT

4.1              Remedies; Obtaining the Collateral Upon Default.  Each Guarantor agrees that, if any Event of Default shall have occurred and be continuing, then and in every such case, subject to any mandatory requirements of applicable law then in effect, the Administrative Agent, in addition to any rights now or hereafter existing under applicable law, shall have all rights as a secured creditor under the Uniform Commercial Code in all relevant jurisdictions and may:

(a)            personally, or by agents or attorneys, immediately take possession of the Collateral or any part thereof, from such Guarantor or any other Person who then has possession of any part thereof with or without notice or process of law, and for that purpose may enter upon such Guarantor's premises where any of the Collateral is located and remove the same and use in connection with such removal any and all services, supplies, aids and other facilities of such Guarantor; and

(b)            instruct the obligor or obligors on any agreement, instrument or other obligation (including, without limitation, the Accounts and the Contracts) constituting the Collateral to make any payment required by the terms of such agreement, instrument or other obligation directly to the Administrative Agent and may exercise any and all remedies of such Guarantor in respect of such Collateral; and

(c)            sell, assign or otherwise liquidate, or direct such Guarantor to sell, assign or otherwise liquidate, any or all of the Collateral or any part thereof, and take possession of the proceeds of any such sale or liquidation; and

(d)            take possession of the Collateral or any part thereof, by directing such Guarantor in writing to deliver the same to the Administrative Agent at any place or places reasonably designated by the Administrative Agent, in which event such Guarantor shall at its own expense:

(i)             forthwith cause the same to be moved to the place or places so designated by the Administrative Agent and there delivered to the Administrative Agent, and

(ii)             store and keep any Collateral so delivered to the Administrative Agent at such place or places pending further action by the Administrative Agent as provided in Section 6.2 hereof, and

(iii)             while the Collateral shall be so stored and kept, provide such guards and maintenance services as shall be necessary to protect the same and to preserve and maintain them in good condition; and

(e)            license or sublicense (to the extent not in violation of the license), whether on an exclusive or nonexclusive basis, any Marks (together with associated goodwill), Patents or Copyrights included in the Collateral for such term and on such conditions and in such manner as the Administrative Agent shall in its sole judgment determine (taking into account such provisions as may be necessary to protect and preserve such Marks, Patents or Copyrights); and

it being understood that each Guarantor's obligation so to deliver the Collateral is of the essence of this Agreement and that, accordingly, upon application to a court of equity having jurisdiction, the Administrative Agent shall be entitled to seek a decree requiring specific performance by such Guarantor of said obligation.

4.2              Remedies; Disposition of the Collateral.  If an Event of Default shall have occurred and be continuing, then any Collateral repossessed by the Administrative Agent under or pursuant to Section 4.1 hereof and any other Collateral whether or not so repossessed by the Administrative Agent, may be sold, assigned, leased or otherwise disposed of under one or more contracts or as an entirety, and without the necessity of gathering at the place of sale the property to be sold, and in general in such manner, at such time or times, at such place or places and on such terms as the Administrative Agent may, in compliance with any mandatory requirements of applicable law, determine to be commercially reasonable.  Any of the Collateral may be so sold, leased or otherwise disposed of, in the condition in which the same existed when taken by the Administrative Agent or after any overhaul or repair at the expense of the relevant Guarantor which the Administrative Agent shall determine to be commercially reasonable.   Any such disposition which shall be a private sale or other private proceedings permitted by such requirements shall be made upon not less than 10 days' written notice to the relevant Guarantor specifying the time at which such disposition is to be made and the intended sale price or other consideration therefor, and shall be subject, for the 10 days after the giving of such notice, to the right of such Guarantor or any nominee of such Guarantor to acquire the Collateral involved at a price or for such other consideration at least equal to the intended sale price or other consideration so specified.  Any such disposition which shall be a public sale permitted by such requirements shall be made upon not less than 10 days' written notice to the relevant Guarantor specifying the time and place of such sale and, in the absence of applicable requirements of law, shall be by public auction (which may, at the Administrative Agent's option, be subject to reserve), after publication of notice of such auction not less than 10 days prior thereto in two newspapers in general circulation in the City of New York or in such other locations as may be necessary in order for the sale to be "commercially reasonable" (as such term is used in Article 9 Part V of the New York Uniform Commercial Code).  To the extent permitted by any such requirement of law, the Administrative Agent and the Secured Creditors may bid for and become the purchaser of the Collateral or any item thereof, offered for sale in accordance with this Section without accountability to such Guarantor.  If, under mandatory requirements of applicable law, the Administrative Agent shall be required to make disposition of the Collateral within a period of time which does not permit the giving of notice to the relevant Guarantor as hereinabove specified, the Administrative Agent need give such Guarantor only such notice of disposition as shall be reasonably practicable in view of such mandatory requirements of applicable law.  Each Guarantor agrees to do or cause to be done all such other acts and things as may be reasonably necessary to make such sale or sales of all or any portion of the Collateral valid and binding and in compliance with any and all applicable laws, regulations, orders, writs, injunctions, decrees or awards of any and all courts, arbitrators or governmental instrumentalities, domestic or foreign, having jurisdiction over any such sale or sales, all at such Guarantor's expense.

4.3              Waiver of Claims.   Except as otherwise provided in this Agreement, EACH GUARANTOR HEREBY WAIVES, TO THE EXTENT PERMITTED BY APPLICABLE LAW, NOTICE AND JUDICIAL HEARING IN CONNECTION WITH THE ADMINISTRATIVE AGENT'S TAKING POSSESSION OR THE ADMINISTRATIVE AGENT'S DISPOSITION OF ANY OF THE COLLATERAL, INCLUDING, WITHOUT LIMITATION, ANY AND ALL PRIOR NOTICE AND HEARING FOR ANY PREJUDGMENT REMEDY OR REMEDIES AND ANY SUCH RIGHT WHICH SUCH GUARANTOR WOULD OTHERWISE HAVE UNDER THE CONSTITUTION OR ANY STATUTE OF THE UNITED STATES OR OF ANY STATE, and each Guarantor hereby further waives, to the extent permitted by law:

(a)            all damages occasioned by such taking of possession except any damages which are the direct result of the Administrative Agent's gross negligence or willful misconduct;

(b)            all other requirements as to the time, place and terms of sale or other requirements with respect to the enforcement of the Administrative Agent's rights hereunder; and

(c)            all rights of redemption, appraisement, valuation, stay, extension or moratorium now or hereafter in force under any applicable law in order to prevent or delay the enforcement of this Agreement or the absolute sale of the Collateral or any portion thereof, and such Guarantor, for itself and all who may claim under it, insofar as it or they now or hereafter lawfully may, hereby waives the benefit of all such laws.

Any sale of, or the grant of options to purchase, or any other realization upon, any Collateral shall operate to divest all right, title, interest, claim and demand, either at law or in equity, of such Guarantor therein and thereto, and shall be a perpetual bar both at law and in equity against such Guarantor and against any and all Persons claiming or attempting to claim the Collateral so sold, optioned or realized upon, or any part thereof, from, through and under such Guarantor.

4.4              Application of Proceeds.  (a)  All moneys collected by the Administrative Agent (or, to the extent the Pledge Agreement or any Mortgage to which any Guarantor is a party requires proceeds of Collateral under such agreement to be applied in accordance with the provisions of this Agreement, the Pledgee or Mortgagee under such other agreement) upon any sale or other disposition of the Collateral, together with all other moneys received by the Administrative Agent hereunder, shall be applied as follows:  

(i)            first, to the payment of all amounts owing the Administrative Agent of the type described in clauses (iii) and (iv) of the definition of "Obligations";

(ii)            second, to the extent proceeds remain after the application pursuant to the preceding clause (i), an amount equal to the outstanding Primary Obligations shall be paid to the Secured Creditors as provided in Section 4.4(e) hereof, with each Secured Creditor receiving an amount equal to such outstanding Primary Obligations or, if the proceeds are insufficient to pay in full all such Primary Obligations, its Pro Rata Share of the amount remaining to be distributed;

(iii)            third, to the extent proceeds remain after the application pursuant to the preceding clauses (i) and (ii), an amount equal to the outstanding Secondary Obligations shall be paid to the Secured Creditors as provided in Section 4.4(e), with each Secured Creditor receiving an amount equal to its outstanding Secondary Obligations or, if the proceeds are insufficient to pay in full all such Secondary Obligations, its Pro Rata Share of the amount remaining to be distributed; and

(iv)            fourth, to the extent proceeds remain after the application pursuant to the preceding clauses (i) through (iii), inclusive, and following the termination of this Agreement pursuant to Section 7.9(a) hereof, to such Guarantor or to whomever may be lawfully entitled to receive such surplus.

(b)         For purposes of this Agreement (i) "Pro Rata Share" shall mean, when calculating a Secured Creditor's portion of any distribution or amount, that amount (expressed as a percentage) equal to a fraction the numerator of which is the then unpaid amount of such Secured Creditor's Primary Obligations or Secondary Obligations, as the case may be, and the denominator of which is the then outstanding amount of all Primary Obligations or Secondary Obligations, as the case may be, (ii) "Primary Obligations" shall mean (A) in the case of the Credit Agreement Obligations, all principal of, and interest on, all Loans, all Unpaid Drawings theretofore made (together with all interest accrued thereon), and the aggregate Stated Amounts of all Letters of Credit issued (or deemed issued) under the Credit Agreement, and all Fees and (B) in the case of the Other Obligations, all amounts due under the Interest Rate Protection or Other Hedging Agreements (other than indemnities, fees (including, without limitation, attorneys' fees) and similar obligations and liabilities) and (iii) "Secondary Obligations" shall mean all Obligations other than Primary Obligations.

(c)         When payments to Secured Creditors are based upon their respective Pro Rata Shares, the amounts received by such Secured Creditors hereunder shall be applied (for purposes of making determinations under this Section 4.4 only) (i) first, to their Primary Obligations and (ii) second, to their Secondary Obligations.  If any payment to any Secured Creditor of its Pro Rata Share of any distribution would result in overpayment to such Secured Creditor, such excess amount shall instead be distributed in respect of the unpaid Primary Obligations or Secondary Obligations, as the case may be, of the other Secured Creditors, with each Secured Creditor whose Primary Obligations or Secondary Obligations, as the case may be, have not been paid in full to receive an amount equal to such excess amount multiplied by a fraction the numerator of which is the unpaid Primary Obligations or Secondary Obligations, as the case may be, of such Secured Creditor and the denominator of which is the unpaid Primary Obligations or Secondary Obligations, as the case may be, of all Secured Creditors entitled to such distribution.

(d)         Each of the Secured Creditors agrees and acknowledges that if the Bank Creditors are to receive a distribution on account of undrawn amounts with respect to Letters of Credit issued (or deemed issued) under the Credit Agreement (which shall only occur after all outstanding Loans and Unpaid Drawings with respect to such Letters of Credit have been paid in full), such amounts shall be paid to the Agent under the Credit Agreement and held by it, for the equal and ratable benefit of the Bank Creditors, as cash security for the repayment of Obligations owing to the Bank Creditors as such.  If any amounts are held as cash security pursuant to the immediately preceding sentence, then upon the termination of all outstanding Letters of Credit, and after the application of all such cash security to the repayment of all Obligations owing to the Bank Creditors after giving effect to the termination of all such Letters of Credit, if there remains any excess cash, such excess cash shall be returned by the Agent to the Administrative Agent for distribution in accordance with Section 4.4(a) hereof.

(e)         Except as set forth in Section 4.4(d) hereof, all payments required to be made hereunder shall be made (i) if to the Bank Creditors, to the Agent under the Credit Agreement for the account of the Bank Creditors, and (ii) if to the Other Creditors, to the trustee, paying agent or other similar representative (each a "Representative") for the Other Creditors or, in the absence of such a Representative, directly to the Other Creditors.

(f)          For purposes of applying payments received in accordance with this Section 4.4, the Administrative Agent shall be entitled to rely upon (i) the Agent under the Credit Agreement and (ii) the Representative for the Other Creditors or, in the absence of such a Representative, upon the Other Creditors for a determination (which the Agent, each Representative for any Secured Creditors and the Secured Creditors agree (or shall agree) to provide upon request of the Administrative Agent) of the outstanding Primary Obligations and Secondary Obligations owed to the Bank Creditors or the Other Creditors, as the case may be.  Unless it has actual knowledge (including by way of written notice from a Bank Creditor or an Other Creditor) to the contrary, the Agent and each Representative, in furnishing information pursuant to the preceding sentence, and the Administrative Agent, in acting hereunder, shall be entitled to assume that no Secondary Obligations are outstanding.  Unless it has actual knowledge (including by way of written notice from an Other Creditor) to the contrary, the Administrative Agent, in acting hereunder, shall be entitled to assume that no Interest Rate Protection or Other Hedging Agreements are in existence.

(g)         It is understood and agreed that each Guarantor shall remain jointly and severally liable to the extent of any deficiency between the amount of the proceeds of the Collateral hereunder and the aggregate amount of the sums referred to in clauses (i) through (iii), inclusive, of Section 4.4(a) hereof.

4.5              Remedies Cumulative.   Each and every right, power and remedy hereby specifically given to the Administrative Agent shall be in addition to every other right, power and remedy specifically given under this Agreement, the Interest Rate Protection or Other Hedging Agreements, the other Loan Documents or now or hereafter existing at law or in equity, or by statute and each and every right, power and remedy whether specifically herein given or otherwise existing may be exercised from time to time or simultaneously and as often and in such order as may be deemed expedient by the Administrative Agent.   All such rights, powers and remedies shall be cumulative and the exercise or the beginning of the exercise of one shall not be deemed a waiver of the right to exercise any other or others.   No delay or omission of the Administrative Agent in the exercise of any such right, power or remedy and no renewal or extension of any of the Obligations and no course of dealing between any Guarantor and the Administrative Agent or any holder of any of the Obligations shall impair any such right, power or remedy or shall be construed to be a waiver of any Default or Event of Default or an acquiescence therein.  No notice to or demand on any Guarantor in any case shall entitle it to any other or further notice or demand in similar or other circumstances or constitute a waiver of any of the rights of the Administrative Agent to any other or further action in any circumstances without notice or demand.  In the event that the Administrative Agent shall bring any suit to enforce any of its rights hereunder and shall be entitled to judgment, then in such suit the Administrative Agent may recover reasonable expenses, including reasonable attorneys' fees, and the amounts thereof shall be included in such judgment.

4.6              Discontinuance of Proceedings.  In case the Administrative Agent shall have instituted any proceeding to enforce any right, power or remedy under this Agreement by foreclosure, sale, entry or otherwise, and such proceeding shall have been discontinued or abandoned for any reason or shall have been determined adversely to the Administrative Agent, then and in every such case each Guarantor, the Administrative Agent and each holder of any of the Obligations shall be restored to their former positions and rights hereunder with respect to the Collateral subject to the security interest created under this Agreement (except to the extent of any such adverse determination), and all rights, remedies and powers of the Administrative Agent shall continue (a) as if no such proceeding had been instituted, in the case of any such proceeding so discontinued or abandoned, or (b) as if no proceeding had been instituted, except to the extent of the determination, in the case of any such proceeding so adversely determined.

ARTICLE V
INDEMNITY

5.1              Indemnity.  (a)  Each Guarantor agrees to indemnify and hold harmless the Administrative Agent and each Secured Creditor and their respective successors, assigns, employees, agents and servants (individually an "Indemnitee," and collectively the "Indemnitees") from and against any and all claims, demands, losses, judgments and liabilities (including liabilities for penalties) of whatsoever kind or nature, and to reimburse each Indemnitee for all costs and expenses, including reasonable attorneys' fees, growing out of or resulting from this Agreement or the exercise by any Indemnitee of any right or remedy granted to it hereunder or under any Interest Rate Hedging Agreement or under any other Loan Document (but excluding any claims, demands, losses, judgments and liabilities or expenses to the extent incurred by reason of gross negligence or willful misconduct of such Indemnitee).  If and to the extent that the obligations of such Guarantor under this Section 5.1(a) are unenforceable for any reason, such Guarantor hereby agrees to make the maximum contribution to the payment and satisfaction of such obligations which is permissible under applicable law.

(b)         Without limiting the application of Section 5.1(a) hereof, each Guarantor agrees to pay, or reimburse the Administrative Agent for any and all reasonable fees, costs and expenses of whatever kind or nature incurred in connection with the creation, preservation or protection of the Administrative Agent's Liens on, and security interest in, the Collateral, including, without limitation, all reasonable fees and taxes in connection with the recording or filing of instruments and documents in public offices, payment or discharge of any taxes or Liens upon or in respect of the Collateral, premiums for insurance with respect to the Collateral and all other reasonable fees, costs and expenses in connection with protecting, maintaining or preserving the Collateral and the Administrative Agent's interest therein, whether through judicial proceedings or otherwise, or in defending or prosecuting any actions, suits or proceedings arising out of or relating to the Collateral.

(c)         Without limiting the application of Section 5.1(a) or (b) hereof, each Guarantor agrees to pay, indemnify and hold each Indemnitee harmless from and against any loss, costs, damages and expenses which such Indemnitee may suffer, expend or incur in consequence of or growing out of any misrepresentation by such Guarantor in this Agreement, any Interest Rate Protection or Other Hedging Agreement, any other Loan Document or in any writing contemplated by or made or delivered pursuant to or in connection with this Agreement, any Interest Rate Protection or Other Hedging Agreement or any other Loan Document.

(d)         If and to the extent that the obligations of any Guarantor under this Section 5.1 are unenforceable for any reason, each Guarantor hereby agrees to make the maximum contribution to the payment and satisfaction of such obligations which is permissible under applicable law.

5.2              Indemnity Obligations Secured by Collateral; Survival.  Any amounts paid by any Indemnitee as to which such Indemnitee has the right to reimbursement shall constitute Obligations secured by the Collateral prior to the release of the Collateral pursuant to the terms hereof.  The indemnity obligations of each Guarantor contained in this Article V shall continue in full force and effect notwithstanding the full payment of all the Notes issued under the Credit Agreement, the termination of all Interest Rate Protection or Other Hedging Agreements and the payment of all other Obligations (but excluding any unasserted contingent and indemnification obligations which survive the termination hereof) and notwithstanding the discharge thereof.

ARTICLE VI
DEFINITIONS

The following terms shall have the meanings herein specified.  Such definitions shall be equally applicable to the singular and plural forms of the terms defined.

"Account" shall have the meaning provided in the Uniform Commercial Code.

"Administrative Agent" shall have the meaning provided in the first paragraph of this Agreement.

"Agent" shall have the meaning provided in the first WHEREAS clause of this Agreement.

"Agreement" shall mean this Amended and Restated Security Agreement as the same may be modified, supplemented, extended, renewed, replaced, restated or amended from time to time in accordance with its terms.

"Guarantor" shall have the meaning provided in the first paragraph of this Agreement.

"Bank Creditor" shall have the meaning provided in the first paragraph of this Agreement.

"Borrower" shall have the meaning provided in the first WHEREAS clause of this Agreement.

"Chattel Paper" shall have the meaning provided in the Uniform Commercial Code.

"Class" shall have the meaning provided in Section 7.2 of this Agreement.

"Collateral" shall have the meaning provided in Section 1.1(a) of this Agreement.

"Contract Rights" shall mean all rights of a Guarantor (including, without limitation, all rights to payment) under each Contract.

"Contracts" shall mean all contracts between a Guarantor and one or more additional parties (including, without limitation, (i) each partnership agreement to which a Guarantor is a party and (ii) any Interest Rate Protection or Other Hedging Agreements), but excluding licenses, agreements and leases, which are immaterial to the operations of an Guarantor, to the extent that the terms thereof prohibit the assignment of, or granting of a security interest in, such licenses, agreements or leases.

"Copyrights" shall mean any United States copyright which a Guarantor now owns or hereafter acquires, including any registrations of any Copyrights in the United States Copyright Office, as well as any application for a United States copyright registration now or hereafter made with the United States Copyright Office by a Guarantor.

"Credit Agreement" shall have the meaning provided in the first WHEREAS clause of this Agreement.

"Credit Agreement Obligations" shall have the meaning provided in the definition of "Obligations" in this Article VI.

"Default" shall mean any event which, with notice or lapse of time, or both, would constitute an Event of Default.

"Deposit Accounts" shall have the meaning provided in the Uniform Commercial Code.

"Documents" shall have the meaning provided in the Uniform Commercial Code.

"Equipment" shall mean any "equipment," as such term is defined in the Uniform Commercial Code, now or hereafter owned by a Guarantor.

"Event of Default" shall mean any Event of Default under, and as defined in, the Credit Agreement and shall in any event, without limitation, include any payment default on any of the Obligations after the expiration of any applicable grace period.

"General Intangibles" shall have the meaning provided in the Uniform Commercial Code.

"Goods" shall have the meaning provided in the Uniform Commercial Code.

"Indemnitee" shall have the meaning provided in Section 5.1 of this Agreement.

"Instrument" shall have the meaning provided in Article 9 of the Uniform Commercial Code.

"Interest Rate Protection or Other Hedging Agreements" shall have the meaning provided in the first paragraph of this Agreement.

"Inventory" shall mean all "inventory" as such term is defined in the Uniform Commercial Code, now or hereafter owned by a Guarantor.

"Investment Property" shall have the meaning ascribed thereto in Article 9 of the UCC.

"LC Creditor" shall have the meaning provided in the first WHEREAS clause of this Agreement.

"Lenders" shall have the meaning provided in the first WHEREAS clause of this Agreement.

"Lenders" shall have the meaning provided in the first WHEREAS clause of this Agreement.

"Letter-of-Credit Rights" shall have the meaning provided in the Uniform Commercial Code.

"Marks" shall mean all right, title and interest in and to any trademarks and service marks and trade names now held or hereafter acquired by a Guarantor, which are registered in the United States Patent and Trademark Office or in any similar office or agency of the United States or any state thereof or any political subdivision thereof and any application for such trademarks and service marks, as well as any unregistered marks used by a Guarantor in the United States and trade dress including logos, designs, trade names, company names, business names, fictitious business names and other business identifiers in connection with which any of these registered or unregistered marks are used in the United States, but excluding all intent-to-use trademark applications for which an application to allege use under 15 U.S.C. §1051(c) and/or for which a statement of use under 15 U.S.C. §1051(d) has not been filed, which applications are identified in Annex D (III).

"Obligations" shall mean (i) the full and prompt payment when due (whether at the stated maturity, by acceleration or otherwise) of all obligations (including, without limitation, all "Obligations" as such term is defined in the Credit Agreement and all obligations which, but for the automatic stay under Section 362(a) of the Bankruptcy Code, would become due) and liabilities of Borrower and each Guarantor now existing or hereafter incurred under, arising out of or in connection with the Credit Agreement or any other Loan Document to which Borrower or any Guarantor is a Party and the due performance and compliance by Borrower and each Guarantor with all of the terms, conditions and agreements contained in each such Loan Document (all such obligations and liabilities being herein collectively called the "Credit Agreement Obligations"); (ii) the full and prompt payment when due (whether at the stated maturity, by acceleration or otherwise) of all obligations (including obligations which, but for the automatic stay under Section 362(a) of the Bankruptcy Code, would become due) and liabilities of Borrower now existing or hereafter incurred under, arising out of or in connection with (x) any Interest Rate Protection or Other Hedging Agreement, whether such Interest Rate Protection or Other Hedging Agreement is now in existence or hereafter arising and the due performance and compliance by Borrower with all of the terms, conditions and agreements contained therein and (y) the US Bank Letter of Credit Facility up to a maximum amount of $2,000,000 (provided that at no time shall there be more than $2,000,000 under the US Bank Letter of Credit Facility secured by the Security Documents) (all such obligations and liabilities described in this clause (ii) being herein collectively called the "Other Obligations"); (iii) any and all sums advanced by the Administrative Agent in order to preserve the Collateral or preserve its security interest in the Collateral; (iv) in the event of any proceeding for the collection or enforcement of any indebtedness, obligations, or liabilities of Borrower or any Guarantor referred to in clauses (i) and (ii), after an Event of Default shall have occurred and be continuing, the reasonable expenses of taking, holding, preparing for sale or lease, selling or otherwise disposing of or realizing on the Collateral, or of any exercise by the Administrative Agent of its rights hereunder, together with reasonable attorneys' fees and court costs; and (v) all amounts paid by any Indemnitee as to which such Indemnitee has the right to reimbursement under Section 6.1 of this Agreement.  It is acknowledged and agreed that the "Obligations" shall include extensions of credit of the types described above, whether outstanding on the date of this Agreement or extended from time to time after the date of this Agreement.

"Other Creditors" shall have the meaning provided in the first paragraph of this Agreement.

"Other Obligations" shall have the meaning provided in the definition of "Obligations" in this Article VI.

"Patents" shall mean any United States patent now or hereafter owned by a Guarantor, as well as any application for a United States patent now or hereafter owned by such Guarantor, but excluding patents and applications for patents that such Guarantor is prohibited by written contract from assigning or granting a security interest in.

"Permitted Filings" shall mean any filing or similar item that was a matter of public record on October 12, 2001, with respect to Collateral secured by the Original Security Agreement, or on the date hereof, with respect to any other Collateral.  

"Primary Obligations" shall have the meaning provided in Section 4.4(b) of this Agreement.

"Pro Rata Share" shall have the meaning provided in Section 4.4(b) of this Agreement.

"Proceeds" shall have the meaning provided in the Uniform Commercial Code.

"Representative" shall have the meaning provided in Section 5.4(e) of this Agreement.

"Required Secured Creditors" shall mean (i) the Required Lenders (or, to the extent required by Article XI of the Credit Agreement, all of the Lenders) under the Credit Agreement so long as any Credit Agreement Obligations remain outstanding and (ii) in any situation not covered by preceding clause (i), the holders of a majority of the outstanding principal amount of the Other Obligations.

"Requisite Creditors" shall have the meaning provided in Section 7.2 of this Agreement.

"Secondary Obligations" shall have the meaning provided in Section 4.4(b) of this Agreement.

"Secured Creditors" shall have the meaning provided in the first paragraph of this Agreement.

"Termination Date" shall have the meaning provided in Section 7.9 of this Agreement.

"Trade Secrets" shall mean any know-how, technology, product formulations, procedures and product and manufacturing specifications or standards now or hereafter utilized by a Guarantor in such Guarantor's business.

"Uniform Commercial Code" or "UCC" shall mean the Uniform Commercial Code as now or hereafter in effect from time to time in the State of New York or any other applicable jurisdiction.

"US Bank Letter of Credit Facility" means that certain revolving letter of credit facility in effect on the date hereof pursuant to that certain Continuing Reimbursement Agreement for Commercial Letters of Credit, dated as of July 14, 2000 by and among the LC Creditor and the Borrower providing for commercial letters of credit; provided, however, that at no time shall there be more than a maximum amount of $2,000,000 under the US Bank Letter of Credit Facility secured by the Security Documents.

ARTICLE VII
MISCELLANEOUS

7.1              Notices.  All such notices and communications hereunder shall be sent or delivered in accordance with the terms of the Credit Agreement.

7.2              Waiver; Amendment.   None of the terms and conditions of this Agreement may be changed, waived, modified or varied in any manner whatsoever unless in writing duly signed by each Guarantor and the Administrative Agent (with the written consent of the Required Lenders, or to the extent required by Section 11.1 of the Credit Agreement, all the Lenders); provided, however, that any change, waiver, modification or variance affecting the rights and benefits of a single Class of Secured Creditors (and not all Secured Creditors in a like or similar manner) shall require the written consent of the Requisite Creditors of such affected Class.  For the purpose of this Agreement, the term "Class" shall mean each class of Secured Creditors, i.e., whether (i) the Bank Creditors as holders of the Credit Agreement Obligations or (ii) the Other Creditors as the holders of the Other Obligations; and the term "Requisite Creditors" of any Class shall mean each of (A) with respect to the Credit Agreement Obligations, the Required Lenders and (B) with respect to the Other Obligations, the holders of at least a majority of all obligations outstanding from time to time under the Interest Rate Protection Agreements or Other Hedging Agreements.

7.3              Obligations Absolute.   The obligations of each Guarantor hereunder shall remain in full force and effect without regard to, and shall not be impaired by, (a) any bankruptcy, insolvency, reorganization, arrangement, readjustment, composition, liquidation or the like of such Guarantor; (b) any exercise or non-exercise, or any waiver of, any right, remedy, power or privilege under or in respect of this Agreement, any other Loan Document or any Interest Rate Protection or Other Hedging Agreement except as specifically set forth in a waiver granted pursuant to Section 7.2 hereof; or (c) any amendment to or modification of any Loan Document or any Interest Rate Protection or Other Hedging Agreement or any security for any of the Obligations; whether or not such Guarantor shall have notice or knowledge of any of the foregoing.

7.4              Successors and Assigns.  This Agreement shall be binding upon the parties hereto and their respective successors and assigns and shall inure to the benefit of the Administrative Agent, each Secured Creditor and each Guarantor and their respective successors and assigns, provided that no Guarantor may transfer or assign any or all of its rights or obligations hereunder without the written consent of the Required Secured Creditors.  All agreements, statements, representations and warranties made by each Guarantor herein or in any certificate or other instrument delivered by such Guarantor or on its behalf under this Agreement shall be considered to have been relied upon by the Secured Creditors and shall survive the execution and delivery of this Agreement, the other Loan Documents and the Interest Rate Protection or Other Hedging Agreements regardless of any investigation made by the Secured Creditors or on their behalf.

7.5              Headings Descriptive.   The headings of the several sections of this Agreement are inserted for convenience only and shall not in any way affect the meaning or construction of any provision of this Agreement.

7.6              Severability.   Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating 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.

7.7              GOVERNING LAW.   THIS AGREEMENT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER THE LAWS OF THE STATE OF NEW YORK, AND FOR ALL PURPOSES SHALL BE CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS AND DECISIONS OF SAID STATE, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW.

7.8              Each Guarantor's Duties.  It is expressly agreed, anything herein contained to the contrary notwithstanding, that each Guarantor shall remain liable to perform all of the obligations, if any, assumed by it with respect to the Collateral and the Administrative Agent shall not have any obligations or liabilities with respect to any Collateral by reason of or arising out of this Agreement, nor shall the Administrative Agent be required or obligated in any manner to perform or fulfill any of the obligations of such Guarantor under or with respect to any Collateral.

7.9              Termination; Release.   (a)  After the Termination Date, this Agreement shall automatically terminate (provided that all indemnities set forth herein including, without limitation, in Section 5.1 hereof shall survive such termination) and the Administrative Agent, at the request and expense of the Guarantors, will execute and deliver to each Guarantor a proper instrument or instruments (including Uniform Commercial Code termination statements on form UCC-3) acknowledging the satisfaction and termination of this Agreement, and will duly assign, transfer and deliver to each Guarantor (without recourse and without any representation or warranty) such of the Collateral of such Guarantor as has not theretofore been sold or otherwise applied or released pursuant to this Agreement.  As used in this Agreement, "Termination Date" shall mean the date upon which all Interest Rate Protection or Other Hedging Agreements have been terminated, no Note under the Credit Agreement is outstanding (and all Loans have been repaid in full), all Letters of Credit have been terminated and all Obligations (as defined in the Credit Agreement) then outstanding (other than any indemnities described in Section 5.1 hereof and in Section 11.4 of the Credit Agreement with respect to which no claim has been asserted) have been paid in full in cash.

(b)         In the event that any part of the Collateral is sold or otherwise disposed of in connection with a sale or other disposition permitted by Section 8.7 of the Credit Agreement or is otherwise released at the direction of the Required Lenders (or all the Lenders if required by Section 11.1 of the Credit Agreement) and the proceeds of such sale or sales or from such release are applied in accordance with the provisions of Section 4.4 of the Credit Agreement, to the extent required to be so applied, such Collateral will be sold free and clear of the Liens created by this Agreement and the Administrative Agent, at the request and expense of the Guarantors, will duly assign, transfer and deliver to the relevant Guarantor (without recourse and without any representation or warranty) such of the Collateral as is then being (or has been) so sold or released and has not theretofore been released pursuant to this Agreement.  The Administrative Agent shall also be entitled to and is hereby authorized and directed to duly assign, transfer and deliver such of the Collateral as provided in Section 11.20(b) of the Credit Agreement.

(c)         At any time that an Guarantor desires that the Administrative Agent take any action to acknowledge or give effect to any release of Collateral pursuant to the foregoing Section 7.9(a) or (b), as the case may be, it shall deliver to the Administrative Agent a certificate signed by an Authorized Officer stating that the release of the respective Collateral is permitted pursuant to Section 7.9(a) or (b), as the case may be.

(d)         The Administrative Agent shall have no liability whatsoever to any Secured Creditor as a result of any release of Collateral by it in accordance with this Section 7.9.

7.10          Counterparts.  This Agreement may be executed in any number of counterparts and by the different parties hereto on separate counterparts, each of which when so executed and delivered shall be an original, but all of which shall together constitute one and the same instrument.  A set of counterparts executed by all the parties hereto shall be lodged with each Guarantor and the Administrative Agent.

7.11          The Administrative Agent.  The Administrative Agent will hold in accordance with this Agreement all items of the Collateral at any time received under this Agreement.  It is expressly understood and agreed by the parties hereto and each Secured Creditor, by accepting the benefits of this Agreement, acknowledges and agrees that the obligations of the Administrative Agent as holder of the Collateral and interests therein and with respect to the disposition thereof, and otherwise under this Agreement, are only those expressly set forth in this Agreement and as provided in the Uniform Commercial Code in the State of New York.   The Administrative Agent shall act hereunder on the terms and conditions set forth in Article IX and Section 11.18 of the Credit Agreement.

7.12          US Bank.  (a) US Bank as LC Creditor under the US Bank Letter of Credit Facility and in its capacity as a Secured Party hereunder hereby irrevocably designates and appoints Bankers Trust Company as Administrative Agent under this Agreement and irrevocably authorizes Bankers Trust Company to act as its Administrative Agent and to take such action on its behalf under the provisions of this Agreement and to exercise such powers and perform such duties as are expressly delegated to the Administrative Agent under this Agreement and the Loan Documents, together with such other powers as are reasonably incidental thereto.  Notwithstanding any provision to the contrary in this Agreement, the Administrative Agent shall not have any duties or responsibilities with respect to US Bank in its capacity LC Creditor under the US Bank Letter of Credit Facility or any fiduciary relationship with US Bank, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this Agreement or otherwise exist against the Administrative Agent.

            (b)            For avoidance of doubt, US Bank expressly acknowledges that all rights and remedies of the Administrative Agent hereunder shall be exercised by the Administrative Agent in accordance with the applicable provisions of the Credit Agreement, and no consent of, or notice to, US Bank shall be required with respect thereto and US Bank shall not undertake any separate action with respect to the Collateral.  The sole right of US Bank hereunder shall be to receive its proportionate share of any proceeds received by the Administrative Agent hereunder in accordance with the terms hereof.  

7.13          Additional Guarantors.   It is understood and agreed that any Subsidiary of Borrower that is required to become a party to this Agreement after the Restatement Date pursuant to Section 7.12 of the Credit Agreement shall automatically become a party hereunder upon the execution and delivery by such Subsidiary of an instrument in the form of Exhibit A hereto and the delivery of same to the Administrative Agent, with the same force and effect as if originally named as a party herein.  The execution and delivery of any instrument adding an additional party to this Agreement shall not require the consent of any party hereunder or of any Secured Creditor.  The rights and obligations of each party hereunder shall remain in full force and effect notwithstanding the addition of any new party hereto.

7.14          Amended and Restated.   This Agreement amends and restates the Subsidiary Guarantor Security Agreement, dated October 12, 2001, among Deutsche Bank Trust Company Americas, U.S. Bank National Association, Vision-Ease Lens, Inc. and Vision-Ease Lens Azusa, Inc. (the "Original Subsidiary Guarantor Security Agreement") and is not in satisfaction of payment of any obligations thereunder and does not constitute a novation of the Original Subsidiary Guarantor Security Agreement but rather shall relate back to the time of the Original Subsidiary Guarantor Security Agreement for the purposes of filing and perfection.

ARTICLE VIII
SPECIAL PROVISIONS CONCERNING ACCOUNTS; CONTRACT RIGHTS; INSTRUMENTS

8.1              Additional Representations and Warranties.  As of the time when each of its Accounts arises, each Guarantor shall be deemed to have represented and warranted that such Account, and all records, papers and documents of each Guarantor relating thereto (if any) are genuine and in all material respects what they purport to be, and that all papers and documents of Guarantor (if any) relating thereto to the best knowledge of each Guarantor (i) will represent the genuine, legal, valid and binding obligation of the account debtor evidencing indebtedness unpaid and owed by the respective account debtor arising out of the performance of labor or services or the sale or lease and delivery of the merchandise listed therein, or both, (ii) will be the only original writings of Guarantor and embodying such obligation of the account debtor named therein (other than copies created for general accounting purposes), (iii) will evidence true and valid obligations, enforceable in accordance with their respective terms subject to applicable bankruptcy, insolvency, reorganization, moratorium and general principles of equityand (iv) will be in material compliance and will conform in all material respects with all applicable federal, state and local laws and applicable laws of any relevant foreign jurisdiction.

8.2              Maintenance of Records.  Each Guarantor will keep and maintain at its own cost and expense accurate and complete records of its Accounts and Contracts, including, but not limited to, records of all payments received, all credits granted thereon, all merchandise returned and all other dealings therewith, and such Guarantor will make the same available on such Guarantor's premises to the Administrative Agent for inspection, at such Guarantor's own cost and expense (not to exceed reasonable costs and expenses), at any and all reasonable times upon prior notice to an Responsible Officer of such Guarantor.  At the request of the Administrative Agent and upon the occurrence and during the continuance of an Event of Default, each Guarantor shall, at its own cost and expense, deliver all tangible evidence of its Accounts and Contract Rights (including, without limitation, all documents evidencing the Accounts and all Contracts) and such books and records to the Administrative Agent or to its representatives (copies of which evidence and books and records may be retained by such Guarantor).  Upon the occurrence and during the continuance of an Event of Default, if the Administrative Agent so directs, each Guarantor shall legend, in form and manner reasonably satisfactory to the Administrative Agent, the Accounts and the Contracts, as well as books, records and documents of such Guarantor evidencing or pertaining to such Accounts and Contracts with an appropriate reference to the fact that the Administrative Agent and that the Administrative Agent has a security interest therein.

8.3              Modification of Terms; etc.  No Guarantor shall rescind or cancel any indebtedness evidenced by any Account or under any Contract, or modify any term relating to such indebtedness or make any adjustment with respect thereto, or extend or renew the same, or compromise or settle any material dispute, claim, suit or legal proceeding relating thereto, or sell any Account or Contract, or interest therein, without the prior written consent of the Administrative Agent (not to be unreasonably withheld or delayed), except as permitted by Section 8.4 hereof or the Credit Agreement.  Each Guarantor will duly fulfill in all material respects all obligations on its part to be fulfilled under or in connection with the Accounts and Contracts and will do nothing to impair the rights of the Administrative Agent in the Accounts or Contracts.

8.4              Collection.   Each Guarantor shall endeavor to cause to be collected from the account debtor named in each of its Accounts or obligor under any Contract, as and when due (including, without limitation, amounts which are delinquent, such amounts to be collected in accordance with sound business judgement) any and all amounts owing under or on account of such Account or Contract, and apply forthwith upon receipt thereof all such amounts as are so collected to the outstanding balance of such Account or under such Contract, except that, unless an Event of Default has occurred and is continuing, each Guarantor may allow in the ordinary course of business as adjustments to amounts owing under its Accounts and Contracts (i) an extension or renewal of the time or times of payment, or settlement for less than the total unpaid balance, which such Guarantor finds appropriate in accordance with sound business judgment and (ii) a refund or credit due as a result of returned or damaged merchandise or improperly performed services or for other reasons which such Guarantor finds appropriate in accordance with sound business judgment.  The reasonable costs and expenses (including, without limitation, reasonable attorneys' fees) of collection, whether incurred by a Guarantor or the Administrative Agent, shall be borne by such Guarantor.

8.5              Instruments.  If any Guarantor owns or acquires any Instrument constituting Collateral, such Guarantor will within 15 days notify the Administrative Agent thereof, and upon request by the Administrative Agent will promptly deliver such Instrument to the Administrative Agent appropriately endorsed to the order of the Administrative Agent as further security hereunder.

8.6              Further Actions.   Each Guarantor will, at its own expense, make, execute, endorse, acknowledge, file and/or deliver to the Administrative Agent from time to time such vouchers, invoices, schedules, confirmatory assignments, conveyances, financing statements, transfer endorsements, powers of attorney, certificates, reports and other assurances or instruments and take such further steps relating to its Accounts, Contracts, Instruments and other property or rights covered by the security interest hereby granted, as the Administrative Agent may reasonably require.

ARTICLE IX
SPECIAL PROVISIONS CONCERNING MARKS

9.1              Additional Representations and Warranties.  Each Guarantor represents and warrants that it is the true and lawful exclusive owner of or otherwise has the right to use the Marks listed in Annex D(I) and D(II) hereto for such Guarantor and that said listed Marks include all the United States federal trademark registrations or applications registered in the United States Patent and Trademark Office.  Each Guarantor represents and warrants that it owns or is licensed to use or is not prohibited from using all Marks that it uses.  Each Guarantor further warrants that, except as set forth in Annex D(IV), it is aware of no third party claim that any aspect of such Guarantor's present or contemplated business operations infringes or will infringe any Mark.  Each Guarantor represents and warrants that it is the owner of record of or otherwise has the right to use all United States registrations and applications listed in Annex D(I) and D(II) hereto and that said registrations are valid, subsisting, have not been canceled and that, except as set forth in Annex D(IV), No Guarantor is aware of any third-party claim that any of said registrations is invalid or unenforceable.  Each Guarantor hereby grants to the Administrative Agent an absolute power of attorney to sign, upon the occurrence and during the continuance of an Event of Default, any document which may be required by the United States Patent and Trademark Office in order to effect an absolute assignment of all right, title and interest in each Mark and associated goodwill, and record the same.

9.2              Licenses and Assignments.  Other than the license agreements listed on Annex E hereto and any extensions or renewals thereof, each Guarantor hereby agrees not to divest itself of any right under any Mark absent prior written approval of the Administrative Agent (which shall not be unreasonably withheld or delayed), except that such Guarantor may license any of its rights in such a Mark in the ordinary course of business provided that such license does not materially interfere with the business of such Guarantor.

9.3              Infringements.   Each Guarantor agrees, promptly upon learning thereof, to notify the Administrative Agent in writing of the name and address of, and to furnish such pertinent information that may be available with respect to (except for any privileged communication), any party who may be infringing or otherwise violating any of such Guarantor's rights in and to any Mark to the extent that such Guarantor reasonably believes that such infringement or violation is material to its business, or with respect to any party claiming that Borrower's use of any Mark violates any property right of that party.  Each Guarantor further agrees, if consistent with good business practice and unless otherwise agreed by the Administrative Agent, to diligently prosecute any Person infringing any Mark to the extent that such Guarantor reasonably believes that such infringement is material to its business.

9.4              Preservation of Marks.   Each Guarantor agrees to use its Marks in interstate commerce during the time in which this Agreement is in effect, sufficiently to preserve such Marks as trademarks or service marks registered under the laws of the United States; provided that, to the extent permitted by the Credit Agreement, no Guarantor shall be obligated to preserve any Mark in the event such Guarantor determines, in its reasonable business judgment, that the preservation of such Mark is no longer desirable in the conduct of its business.

9.5              Maintenance of Registration.  Each Guarantor shall, at its own expense, diligently process all documents required by the Trademark Act of 1946, 15 U.S.C. §§ 1051 et seq. to maintain trademark registrations, including but not limited to affidavits of use and applications for renewals of registration in the United States Patent and Trademark Office for all of its Marks pursuant to 15 U.S.C. §§ 1058(a), 1059 and 1065, and shall pay all fees and disbursements in connection therewith and shall not abandon any such filing of affidavit of use or any such application of renewal prior to the exhaustion of all reasonable administrative and judicial remedies without prior written consent of the Administrative Agent (which consent will not be unreasonably withheld or delayed) except if, in its reasonable business judgment, such action is no longer desirable in the conduct of its business.

9.6              Future Registered Marks.  If any Mark registration issues hereafter to a Guarantor as a result of any application now or hereafter pending before the United States Patent and Trademark Office, within 60 days of receipt of such certificate, such Guarantor shall deliver to the Administrative Agent a copy of such certificate, and a grant of security in such Mark to the Administrative Agent, confirming the grant thereof hereunder, the form of such confirmatory grant to be substantially the same as the form hereof.

9.7              Remedies.  If an Event of Default shall occur and be continuing, the Administrative Agent may, by written notice to the Guarantors, take any or all of the following actions:  (i) declare the entire right, title and interest of each Guarantor in and to each of such Guarantor's Marks together with the goodwill of the business associated therewith, together with all trademark rights and rights of protection to the same, vested in the Administrative Agent for the benefit of the Secured Creditors, in which event such rights, title and interest shall immediately vest, in the Administrative Agent for the benefit of the Secured Creditors, in which case the Administrative Agent shall be entitled to exercise the power of attorney referred to in Section 9.1 to execute, cause to be acknowledged and notarized and record said absolute assignment with the applicable agency; (ii) take and use or sell the Marks together with the goodwill of such Guarantor's business symbolized by the Marks and the right to carry on the business and use the assets of such Guarantor in connection with which the Marks have been used; and (iii) direct such Guarantor to refrain, in which event such Guarantor shall refrain, from using the Marks in any manner whatsoever, directly or indirectly, and, if requested by the Administrative Agent, change such Guarantor's corporate name to eliminate therefrom any use of any Mark and execute such other and further documents that the Administrative Agent may request to further confirm this and to transfer ownership of the Marks and any registrations and any trademark application in the United States Patent and Trademark Office or any equivalent government agency or office in any foreign jurisdiction to the Administrative Agent.

ARTICLE X
SPECIAL PROVISIONS CONCERNING PATENTS AND COPYRIGHTS AND TRADE SECRETS

10.1          Additional Representations and Warranties.  Each Guarantor represents and warrants that it is the true and lawful exclusive owner of or otherwise has the right to use (i) all material Trade Secrets necessary to operate the business of such Guarantor, (ii) the Patents listed in Annex F hereto for such Guarantor and (iii) the Copyrights listed in Annex G hereto for such Guarantor, that to the best of its knowledge said Patents include all the United States patents and applications for United States patents that such Guarantor now owns or otherwise has the right to use (except for any patent that such Guarantor does not have the right to assign or grant a security interest in) and that said Copyrights constitute all the United States copyrights registered with the United States Copyright Office and applications for United States copyrights that such Guarantor now owns or otherwise has the right to use and that in each case are necessary in the conduct of the business of such Guarantor.  Each Guarantor represents and warrants that it owns or is licensed to practice under all Patents and Copyrights that it now uses or practices under.  Each Guarantor further warrants that, except as set forth in Schedule F(I), it is aware of no third party claim that any aspect of such Guarantor's present or contemplated business operations infringes or will infringe any patent or any copyright or which such Guarantor has misappropriated any Trade Secrets or proprietary information.  Each Guarantor hereby grants to the Administrative Agent an absolute power of attorney to sign, upon the occurrence and during the continuance of any Event of Default, any document which may be required by the United States Patent and Trademark Office or the United States Copyright Office in order to effect an absolute assignment of all right, title and interest in each Patent and Copyright, and record the same.

10.2          Licenses and Assignments.  Other than the license agreements listed on Annex E hereto and any extensions or renewals thereof, Each Guarantor hereby agrees not to divest itself of any right under any Patent or Copyright absent prior written approval of the Administrative Agent except that such Guarantor may license any of its rights to such Patent or Copyright in the ordinary course of business provided that such license does not materially interfere with the business of such Guarantor or any Subsidiary consistent with past practices or as is consistent with its existing licensing strategy.

10.3          Infringements.   Each Guarantor agrees, promptly upon learning thereof, to furnish the Administrative Agent in writing with all pertinent information (except for any privileged information)available to such Guarantor with respect to any infringement or other violation of such Guarantor's rights in and to any Patent or Copyright to the extent that such Guarantor reasonably believes that such infringement or violation is material to its business, or with respect to any claim that practice of any Patent or Copyright violates any property right of a third party, or with respect to any misappropriation of any Trade Secret by such Guarantor or any claim that such Guarantor's practice of any Trade Secret violates any property right of a third party.   Each Guarantor further agrees, consistent with good business practice and absent direction of the Administrative Agent to the contrary, diligently to prosecute any Person infringing any Patent or Copyright or any Person misappropriating any of such Guarantor's Trade Secrets to the extent that such Guarantor reasonably believes that such infringement or misappropriation is material to its business.

10.4          Maintenance of Patents.  At its own expense, each Guarantor shall make timely payment of all post-issuance fees required pursuant to 35 U.S.C. § 41 to maintain in force rights under each Patent except if, in its reasonable business judgment, such maintenance of such Patent is no longer desirable in the conduct of its business.

10.5          Prosecution of Patent Application.  At its own expense, each Guarantor shall diligently prosecute all applications for Patents listed in Annex F hereto for such Guarantor and shall not abandon any such application prior to exhaustion of all reasonable administrative and judicial remedies, absent written consent of the Administrative Agent; provided, however, that to the extent permitted by the Credit Agreement, no Guarantor shall be obligated to prosecute any application in the event such Guarantor determines, in its reasonable business judgment, that the prosecuting of such application is no longer necessary or desirable in the conduct of its business.

10.6          Other Patents and Copyrights.  Within 60 days of its acquisition of a Patent or Copyright, or of its filing of an application for a Patent or Copyright, each Guarantor shall deliver to the Administrative Agent a copy of said Patent or Copyright or such application, as the case may be, with a grant of security as to such Patent or Copyright, as the case may be, confirming the grant thereof hereunder, the form of such confirmatory grant to be substantially the same as the form hereof.

10.7          Remedies.  If an Event of Default shall occur and be continuing, the Administrative Agent may by written notice to Guarantors, take any or all of the following actions:  (i) declare the entire right, title, and interest of Guarantors in each of the Patents and Copyrights vested in the Administrative Agent for the benefit of the Secured Creditors, in which event such right, title, and interest shall immediately vest in the Administrative Agent for the benefit of the Secured Creditors, in which case the Administrative Agent shall be entitled to exercise the power of attorney referred to in Section 10.1 hereof to execute, cause to be acknowledged and notarized and record said absolute assignment with the applicable agency; (ii) take and practice or sell the Patents and Copyrights; and (iii) direct Guarantors to refrain, in which event each Guarantor shall refrain, from practicing the Patents and using the Copyrights directly or indirectly, and each Guarantor shall execute such other and further documents as the Administrative Agent may request further to confirm this and to transfer ownership of the Patents and Copyrights to the Administrative Agent for the benefit of the Secured Creditors.

[Signature Page Follows]

                        IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed and delivered by their duly authorized officers as of the date first above written.

VISION-EASE LENS, INC.,
as Guarantor

                        By:  /s/ Bradley D. Carlson

                        Name:  Bradley D. Carlson

                        Title:  Treasurer

VISION-EASE LENS AZUSA, INC.,
as Guarantor

                        By:  /s/ Bradley D. Carlson

                        Name:  Bradley D. Carlson

                        Title:  Treasurer

DEUTSCHE BANK TRUST COMPANY AMERICAS,
(formerly named Bankers Trust Company),
 as Administrative Agent

                        By:  /s/ Mary Jo Jolly

                        Name:  Mary Jo Jolly

                        Title:  Assistant Vice President

U.S. BANK NATIONAL ASSOCIATION

                        By:  /s/ Nicholas G. Myers

                        Name:  Nicholas G. Myers

                        Title:  Assistant Vice President

EX-10.50

FIRST AMENDMENT TO MORTGAGE

This FIRST AMENDMENT TO MORTGAGE (this "Amendment"), effective as of September 27, 2002, is made by and between VISION-EASE LENS, INC., a Minnesota corporation (the "Mortgagor"), having an office at One Meridian Crossings, Suite 850, Minneapolis, Minnesota 55423, and DEUTSCHE BANK TRUST COMPANY AMERICAS (formerly named Bankers Trust Company), as administrative agent for the Lenders (in such capacity, hereinafter, the "Mortgagee") and as a Lender, having an office at 130 Liberty Street, New York, New York 10006.

WITNESSETH:

WHEREAS, Mortgagor executed in favor of Bankers Trust Company (now named Deutsche Bank Trust Company Americas), as Administrative Agent, that certain Mortgage, Assignment of Leases and Rents and Fixture Filing (the "Mortgage") dated as of October 12, 2001 and recorded October 15, 2001 with the Office of the Clerk and Recorder of Anoka County, Minnesota as Document No. 1610955, relating to the real estate legally described on Exhibit A attached hereto and made a part hereof (the "Property");

WHEREAS, Mortgagor, Mortgagee, certain banks and financial institutions party thereto and Bank One, N.A., as "Documentation Agent" have entered into that certain Third Amended and Restated Credit Agreement of even date herewith (the "Third Amended and Restated Credit Agreement"), further amending and restating that certain Credit Agreement (as defined in the Mortgage); and

WHEREAS, in connection with the Third Amended and Restated Credit Agreement, Mortgagor and Mortgagee desire to amend the Mortgage in certain respects as hereinafter provided. All capitalized terms not specifically defined herein shall have the respective meanings given or ascribed to them in the Mortgage or, if not defined in the Mortgage, the Third Amended and Restated Credit Agreement.

NOW THEREFORE, for Ten Dollars ($10.00) and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Mortgagor and Mortgagee hereby agree as follows:

1.          Effective Date. The terms and provisions of this Amendment shall become effective as of the date hereof (the "Effective Date").

2.           Amendment of "Mortgagee". All references to "Mortgagee" in the Mortgage shall hereinafter refer to Deutsche Bank Trust Company Americas (formerly named Bankers Trust Company) as administrative agent for the Lenders and as a Lender.

3.           Replacement of Paragraph 35. Paragraph 35 of the Mortgage is hereby deleted in its entirety and replaced with the following:

"35.     Maturity Date. The latest obligation secured by this Mortgage matures on May 14, 2004."

4.           Severability. If any provision of this Amendment is held to be illegal, invalid or unenforceable under present or future laws, such provision shall be fully severable and this Amendment shall be construed and enforced as if such illegal, invalid or unenforceable provision had never comprised a part hereof, and the remaining provisions hereof or thereof shall remain in full force and effect and shall not be affected by the illegal, invalid or unenforceable provision which shall be construed as similar in terms as may be possible while remaining legal, valid and enforceable.

5.           Successors and Assigns. This Amendment shall be binding upon Mortgagor and its successors and assigns, and shall inure to the benefit of Mortgagee and its successors and assigns.

6.           Governing Law. This Amendment shall be governed by and shall be construed and enforced in accordance with the internal laws of the State of Minnesota (without regard to conflicts of law principles) and applicable laws of the United States.

7.           Counterparts. This Amendment may be executed in one or more counterparts, each of which shall constitute an original, but all of which together shall constitute one and the same instrument.

8.           Headings. The headings of sections and paragraphs in this Amendment are for convenience and reference only and shall not be construed in any way to limit or define the content, scope, or intent of the provisions.

9.           Reaffirmation of Mortgage. Except as specifically modified by this Amendment, all other terms of the Mortgage shall remain in full force and effect. Any and all references in the Mortgage to the "Mortgage" shall mean the Mortgage, as amended by this Amendment.

[Signature and Notary Pages Follow]

    IN WITNESS WHEREOF, Mortgagor and Mortgagee have executed this Amendment intending same to be effective as of the date first written above.

MORTGAGOR:

VISION-EASE LENS, INC., a Minnesota corporation

By: /s/ Bradley D. Carlson
Name: Bradley D. Carlson
Title: Treasurer

MORTGAGEE:

DEUTSCHE BANK TRUST COMPANY AMERICAS (formerly named Bankers Trust
Company), as administrative agent for the
Lenders and as a Lender

By: /s/ Mary Jo Jolly
Name: Mary Jo Jolly
Title: Assistant Vice President

STATE OF MINNESOTA	)
	)	ss.
COUNTY OF HENNEPIN	)

The foregoing instrument was acknowledged before me this 7th day of August, 2002, by Bradley D. Carlson, the Treasurer of Vision-Ease Lens, Inc., a Minnesota corporation, on behalf of said corporation.

/s/ Julie K. Uhrich
Notary Public

STATE OF NEW YORK	)
	)	ss.
COUNTY OF NEW YORK	)

The foregoing instrument was acknowledged before me this 27th day of September, 2002, by Mary Jo Jolly, the Assistant Vice President of Deutsche Bank Trust Company Americas (formerly named Bankers Trust Company), on behalf of said entity.

/s/ Mary E. Somoza
Notary Public

THIS INSTRUMENT WAS
PREPARED BY AND AFTER
RECORDING SHOULD BE
RETURNED TO:

Winston & Strawn
35 West Wacker Drive
Chicago, Illinois 60601
Attn: Ankur Gupta, Esq.

EXHIBIT A
TO
FIRST AMENDMENT TO MORTGAGE

Mortgagor:       VISION-EASE LENS, INC., a Minnesota corporation

Mortgagee: DEUTSCHE BANK TRUST COMPANY AMERICAS (formerly named Bankers Trust Company), as administrative agent for the Lenders and as a Lender

The Land described in the referenced instrument is located in Anoka County, Minnesota, and is described as follows:

    Lot 1, Block 1, A.E.C. Energy Park Second Addition, according to the recorded plat thereof, in the County of Anoka, State of Minnesota.

EX-10.51

PRINCIPAL AMOUNT  

SECURED $145,000,000.00

MORTGAGE, ASSIGNMENT OF LEASES AND RENTS,

AND SECURITY AGREEMENT

THIS MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, AND SECURITY AGREEMENT, dated as of the 27th day of September, 2002 (the "Mortgage"), is executed and delivered by BMC INDUSTRIES, INC., a Minnesota corporation ("BMC"), and CORTLAND COUNTY INDUSTRIAL DEVELOPMENT AGENCY, a public benefit corporation existing under the laws of the State of New York (the "Agency"), (BMC and the Agency hereafter collectively referred to as "Mortgagor"), to DEUTSCHE BANK TRUST COMPANY AMERICAS (formerly known as Bankers Trust Company), not individually, but solely in its capacity as Administrative Agent under the Credit Agreement (as defined below) (the "Mortgagee").

Recitals

 WHEREAS, BMC is the holder of the fee simple title to the Premises (defined below);

WHEREAS, the Agency is the holder of leasehold estates in the Premises pursuant to that certain Lease to Agency dated as of February 1, 1999, together with all options to renew, extend or purchase (including rights of first refusal) now or hereafter contained therein (the "Underlying Lease") by and between BMC, as landlord, and the Agency, as tenant, which Underlying Lease has been memorialized of record by that certain Memorandum of Underlying Lease by and between BMC and the Agency dated as of February 1, 1999 and recorded on February 25, 1999 as Instrument No. 1999-1008, and that certain Lease to Agency dated as of July 1, 1996, together with all options to renew, extend or purchase (including rights of first refusal) now or hereafter contained therein (the "1996 Lease") by and between BMC, as landlord, and the Agency, as tenant, which 1996 Lease, as further evidenced by that certain Memorandum of Underlying Lease by and between BMC and the Agency dated as of July 1, 1996 (unrecorded);

WHEREAS, BMC, Mortgagee, NBD Bank, as Documentation Agent, and certain other lenders have entered into that certain Credit Agreement dated as of May 15, 1998 (the "Original Credit Agreement"), as the same was amended and restated as of June 25, 1998, and as the same was previously amended prior to that date hereof (the "First Amended and Restated Credit Agreement");

WHEREAS, BMC, Mortgagee, Documentation Agent and the financial institutions parties thereto have entered into that certain Second Amendment and Restatement Agreement dated as of October 12, 2001 (the "Second Amendment and Restatement Agreement"), amending and restating the First Amended and Restated Credit Agreement;

WHEREAS, pursuant to that certain Third Amended and Restated Credit Agreement, dated as of the date hereof, the First Amended and Restated Credit Agreement (as previously amended by the Second Amendment and Restatement Agreement) was further amended (as used herein, the term "Credit Agreement" means the First Amended and Restated Credit Agreement, as in effect on the date hereof and as amended by that certain Second Amendment and Restatement Agreement described above and as amended by that certain Third Amended and Restated Credit Agreement described above, as the same may be amended, modified, extended, renewed, replaced, restated or supplemented from time to time, and including any agreement extending the maturity of or restructing of all or any portion of the Indebtedness (as hereinafter defined) under such agreement or any successor agreements), and the financial institutions party thereto have severally agreed to make certain extensions of credit to or for the benefit of BMC upon the terms and conditions set forth therein;

WHEREAS, pursuant to the terms of the Credit Agreement, the obligations of BMC under the Credit Agreement and the other Loan Documents (as hereinafter defined) shall be secured by, among other things, a lien upon and perfected security interest in all estate, right, title and interest of the Mortgagor in and to the Mortgaged Property (as hereinafter defined) pursuant to the terms hereof;

WHEREAS, terms used but not defined in this Mortgage have the meanings given to them in the Credit Agreement;

NOW, THEREFORE, to secure (a) payment of the Notes, with interest thereon, (b) performance of BMC's obligations under the Loan Documents insofar as they relate to the Notes or guarantee repayment of the Notes, (c) payment by BMC to Mortgagee of all sums expended or advanced by Mortgagee pursuant to any covenant, term, or provision of this Mortgage, and (d) performance of each covenant, term and provision by BMC to be performed pursuant to this Mortgage (clauses (a)-(d) hereafter collectively referred to as the "Indebtedness"), and provided that the maximum principal indebtedness secured hereby shall never exceed $145,000,000, Mortgagor hereby mortgages, grants, conveys, warrants, pledges, assigns, and hypothecates unto Mortgagee, its successors and assigns, WITH THE POWER OF SALE, the real property described in Exhibit A attached hereto including, but not limited to, Mortgagor's interests in the Premises, (the "Premises"), and all of the buildings, structures, fixtures, additions, enlargements, extensions, modifications, repairs, replacements, and improvements now or hereafter located thereon (the "Improvements");

TOGETHER WITH all right, title, interest, and estate of Mortgagor now owned, or hereafter acquired, in and to the following property, rights, interests and estates (the Premises, the Improvements, and such property, rights, interests, and estates hereinafter described are collectively referred to as the "Mortgaged Property"):

GRANTING CLAUSE ONE

All easements, rights-of-way, strips and gores of land, streets, ways, alleys, passages, sewer rights, water, water courses, water rights and powers, air rights and development rights, all rights to oil, gas, minerals, coal and other substances of any kind or character, and all estates, rights, titles, interests, privileges, liberties, tenements, hereditaments and appurtenances of any nature whatsoever, in any way belonging, relating or pertaining to the Premises and the Improvements and the reversion and reversions, remainder and remainders, and all land lying in the bed of any street, road, highway, alley or avenue, opened, vacated or proposed, in front of or adjoining the Premises, to the center line thereof and all the estates, rights, titles, interests, dower and rights of dower, curtsey and rights of curtsey, property, possession, claim and demand whatsoever, both at law and in equity, of Mortgagor of, in and to the Premises and the Improvements and every part and parcel thereof, with the appurtenances thereto;

GRANTING CLAUSE TWO

All machinery, furniture, furnishings, equipment, computer software and hardware, fixtures (including, without limitation, all heating, air conditioning, plumbing, lighting, communications and elevator fixtures) and other property of every kind and nature, whether tangible or intangible, whatsoever owned by Mortgagor, or in which Mortgagor has or shall have an interest, now or hereafter located upon the Premises and the Improvements, or appurtenant thereto, and usable in connection with the present or future operation and occupancy of the Premises and the Improvements and all building equipment, materials and supplies of any nature whatsoever owned by Mortgagor, or in which Mortgagor has or shall have an interest, now or hereafter located upon the Premises and the Improvements, or appurtenant thereto, or usable in connection with the present or future operation, enjoyment and occupancy of the Premises and the Improvements (hereinafter collectively referred to as the "Equipment"), including any leases of any of the foregoing, any deposits existing at any time in connection with any of the foregoing, and the proceeds of any sale or transfer of the foregoing, and the right, title and interest of Mortgagor in and to any of the Equipment that may be subject to any "security interests" as defined in New York's Uniform Commercial Code (the "Uniform Commercial Code"), superior in lien to the lien of this Mortgage;

GRANTING CLAUSE THREE

Awards or payments, including interest thereon, that may heretofore and hereafter be made with respect to the Premises and the Improvements, whether from the exercise of the right of eminent domain or condemnation (including, without limitation, any transfer made in lieu of or in anticipation of the exercise of said rights), or for a change of grade, or for any other injury to or decrease in the value of the Premises and Improvements;

GRANTING CLAUSE FOUR

All leases and other agreements or arrangements heretofore or hereafter entered into affecting the use, enjoyment or occupancy of, or the conduct of any activity upon or in, the Premises and the Improvements, including any extensions, renewals, modifications or amendments thereof, but excluding the exercise by the Agency of the Agency's Reserved Rights (as hereinafter defined), (the "Leases") and all rents, rent equivalents, moneys payable as damages or in lieu of rent or rent equivalents, royalties (including, without limitation, all oil and gas or other mineral royalties and bonuses), income, receivables, receipts, revenues, deposits (including, without limitation, security, utility and other deposits), accounts, cash, issues, profits, charges for services rendered, and other consideration of whatever form or nature received by or paid to or for the account of or benefit of Mortgagor or its agents or employees from any and all sources arising from or attributable to the Premises and the Improvements, excluding, however, any moneys payable to the Agency pursuant to the Agency's Reserved Rights (the "Rents"), together with all proceeds from the sale or other disposition of the Leases and the right to receive and apply the Rents to the payment of the Obligations;

GRANTING CLAUSE FIVE

All proceeds of and any unearned premiums on any insurance policies covering the Mortgaged Property, including, without limitation, the right to receive and apply the proceeds of any insurance, judgments, or settlements made in lieu thereof, for damage to the Mortgaged Property;

GRANTING CLAUSE SIX

The right, in the name and on behalf of Mortgagor, to appear in and defend any action or proceeding brought with respect to the Mortgaged Property and to commence any action or proceeding to protect the interest of Mortgagee in the Mortgaged Property;

GRANTING CLAUSE SEVEN

All proceeds, products, offspring, rents and profits from any of the foregoing, including, without limitation, those from sale, exchange, transfer, collection, loss, damage, disposition, substitution or replacement of any of the foregoing.

TO HAVE AND TO HOLD the above granted and described Mortgaged Property, WITH THE POWER OF SALE, unto and to the use and benefit of Mortgagee, forever;

PROVIDED, HOWEVER, these presents are upon the express condition that, if BMC shall well and truly pay to Mortgagee the Indebtedness at the time and in the manner provided in the Notes and this Mortgage and shall well and truly abide by and comply with each and every covenant and condition set forth herein, in the Notes and in the other Loan Documents in a timely manner, these presents and the estate hereby granted shall cease, terminate and be void upon the full payment of the Indebtedness.

This Mortgage secures the payment of the Indebtedness in a principal amount not to exceed $145,000,000 (the "Secured Principal Amount"), together with interest and amounts that Mortgagee expends under this Mortgage in connection with (i) any taxes, charges or assessments that may be imposed by law upon the Mortgaged Property, (ii) premiums on insurance policies covering the Mortgaged Property, and (iii) expenses incurred in upholding the lien of this Mortgage, including the expenses of any litigation to prosecute or defend the rights and lien created by this Mortgage, all of the foregoing Indebtedness and obligations, collectively, the "Secured Indebtedness." Notwithstanding any provision in this Mortgage to the contrary, (a) until the Indebtedness is paid in full, this Mortgage secures the entire Indebtedness provided that the maximum principal Indebtedness secured hereby shall never exceed the Secured Principal Amount; (b) this Mortgage shall secure only the Indebtedness, taxes, charges, assessments, premiums, and expenses included within the foregoing definition of "Secured Indebtedness"; and (c) the Secured Principal Amount shall be reduced only by the last and final sums that Mortgagor repays, or is paid on its behalf, with respect to the principal of the Indebtedness and shall not be reduced by any intervening principal payments of the Indebtedness; such intervening principal payments shall instead be deemed to reduce only such portions of the Indebtedness first, as are unsecured, second, as are secured by other collateral other than real property located in New York State owned by BMC, third, as are secured by a subordinated lien on real property located in New York State owned by BMC, including the Mortgaged Property, which subordinated lien is subordinated to a first lien held on such real property by the Mortgagee.

Mortgagor represents and warrants to and covenants and agrees with Mortgagee as follows:

PART I

GENERAL PROVISIONS

1.         Payment of Indebtedness and Incorporation of Covenants, Conditions and Agreements.  BMC shall pay the Indebtedness at the time and in the manner provided in the Notes and in the other Loan Documents.  All the covenants, conditions and agreements contained in the Notes and any of the Loan Documents are hereby made a part of this Mortgage to the same extent and with the same force as if fully set forth herein.

2.         Warranty of Title.  BMC warrants that Mortgagor has good, marketable and insurable title to the Mortgaged Property and has the full power, authority and right to execute, deliver and perform its obligations under this Mortgage and to deed, encumber, mortgage, give, grant, bargain, sell, alienate, convey, confirm, pledge, assign and hypothecate the same and that Mortgagor possesses an unencumbered fee estate in the Premises and the Improvements and that it owns the Mortgaged Property free and clear of all liens, encumbrances and charges whatsoever except for certain utility easements which do not affect in any way Mortgagor's use of the Mortgaged Property and except as listed in Schedule B of the Cortland Mortgage Policy (the "Permitted Exceptions") and that this Mortgage is and will remain a valid and enforceable first lien on and security interest in the Mortgaged Property, subject only to said Permitted Exceptions.  BMC shall forever warrant, defend and preserve such title and the validity and priority of the lien of this Mortgage and shall forever warrant and defend the same to Mortgagee against the claims of all persons whomsoever.

3.         Insurance; Casualty.

BMC, at its sole cost and expense, will maintain insurance coverage with respect to the Mortgaged Property of the types and in the amounts required by the Credit Agreement.  If the Mortgaged Property shall be damaged or destroyed in whole or in part by casualty, BMC shall give prompt written notice to Mortgagee generally describing the nature and extent of such casualty, and all insurance proceeds to which Mortgagor may be entitled as a result of such casualty shall be distributed and applied in accordance with the Credit Agreement.

4.         Representations.  BMC hereby represents and warrants to Mortgagee as follows:

(a)       This Mortgage is in all respects a valid and legally binding obligation of BMC, enforceable in accordance with its terms.

(b)       The execution and delivery of this Mortgage and the performance and observance by BMC of its obligations hereunder will not contravene or result in a breach of (i) BMC's certificate of incorporation or by-laws, (ii) any governmental requirements, (iii) any decree or judgement binding on Mortgagor, or (iv) any agreement or instrument binding on Mortgagor or any of its properties, nor will the same result in the creation of any lien or security interest under any such agreement or instrument.

(c)       All utility services necessary and sufficient for the construction, development and operation of the Mortgaged Property for its intended purposes are presently available to the Premises through dedicated public rights of way or through perpetual private easements, approved by Mortgagee, with respect to which the Mortgage creates a valid, binding and enforceable lien, including, but not limited to, water supply, storm and sanitary sewer, gas, electric and telephone facilities, and drainage.

(d)       Neither the Mortgaged Property nor any portion thereof is now damaged or injured as result of any fire, explosion, accident, flood or other casualty or has been the subject of any taking, and, to the knowledge of BMC, no taking is pending or contemplated.

(e)       All federal, state and other tax returns of BMC with respect to the Mortgaged Property required by law to be filed have been filed; all federal, state and other taxes, assessments and other governmental charges upon BMC with respect to the Mortgaged Property which are due and payable have been paid; and BMC has set aside on its books provisions reasonably adequate for the payment of all such taxes for periods subsequent to the periods for which such returns have been filed.

(f)       BMC has made no contract or arrangement of any kind or type whatsoever (whether oral or written, formal or informal), the performance of which by the other party thereto could give rise to a lien or encumbrance on the Mortgaged Property, except for contracts (all of which have been disclosed in writing to Mortgagee) made by Mortgagor with parties who have executed and delivered lien waivers to BMC, and which, in the opinion of Mortgagee's counsel, will not create rights in existing or future lien claimants which may be superior to the lien of the Mortgage.

(g)       The rights of way for all roads necessary for the full utilization of the Improvements for their intended purposes have either been acquired by the Mortgagor, the appropriate governmental authority or have been dedicated to public use and accepted by such governmental authority, and all such roads shall have been completed, or all necessary steps shall have been taken by BMC and such governmental authority to assure the complete construction and installation thereof prior to the date upon which access to the Mortgaged Property via such roads will be necessary.  All curb cuts, driveway permits and traffic signals necessary for access to the Mortgaged Property after completion of the Improvements are existing or have been fully approved by the appropriate governmental authority.

(h)       No Event of Default (hereinbelow defined) exists and no event which but for the passage of time, the giving of notice or both would constitute an Event of Default has occurred.

(i)       The Permitted Exceptions do not and will not materially and adversely affect (1) the ability of BMC to pay in full the principal and interest on the Notes in a timely manner or (2) the use of the Mortgaged Property for the use currently being made thereof, the operation of the Mortgaged Property as currently being operated or the value of the Mortgaged Property.

(j)       Upon the execution by Mortgagor and the recording of this Mortgage, and upon the execution and filing of UCC-1 financing statements or amendments thereto, Mortgagee will have a valid first lien on the Mortgaged Property and a valid security interest in the Equipment subject to no liens, charges or encumbrances other than the Permitted Exceptions.

(k)       BMC (1) has not executed the Notes, this Mortgage, or any other Loan Document with the actual intent to hinder, delay, or defraud any creditor and (2) has received reasonably equivalent value in exchange for its obligations under the Notes, this Mortgage, and the other Loan Documents.  The fair saleable value of Mortgagor's assets exceed and will, immediately following the execution and delivery of this Mortgage, exceed Mortgagor's total liabilities, including, without limitation, subordinated, unliquidated, disputed or contingent liabilities.  The fair saleable value of Mortgagor's assets is and will, immediately following the execution and delivery of this Mortgage, be greater than Mortgagor's probable liabilities, including the maximum amount of its contingent liabilities or its debts as such debts become absolute and matured.  Mortgagor's assets do not and, immediately following the execution and delivery of this Mortgage will not, constitute unreasonably small capital to carry out its business as conducted or as proposed to be conducted.  Mortgagor shall not incur debts and liabilities (including, without limitation, contingent liabilities and other commitments) beyond its ability to pay such debts as they mature (taking into account the timing and amounts to be payable on or in respect of obligations of Mortgagor).

(l)         Mortgagor has full power, authority and right to execute, deliver and perform its obligations pursuant to this Mortgage, and to deed, mortgage, give, grant, bargain, sell, alien, convey, confirm, warrant, pledge, hypothecate and assign the Mortgaged Property pursuant to the terms hereof and to keep and observe all of the terms of this Mortgage on Mortgagor's part to be performed.

(m)      BMC is not a "foreign person" within the meaning of Section 1445(f)(3) of the Internal Revenue Code of 1986, as amended and the related Treasury Department regulations, including temporary regulations.

5.         Appointment of Receiver. In any action to foreclose this Mortgage, Mortgagee shall be entitled, without notice and as a matter of right and without regard to the adequacy of any security of the indebtedness or the solvency of Mortgagor, upon application to any court having jurisdiction, to the appointment of a receiver of the rents, income and profits of the Mortgaged Property.  If an Event of Default occurs under this Mortgage, BMC, upon demand of Mortgagee, shall surrender the possession of, and it shall be lawful for Mortgagee, by such officer or agent as it may appoint, to take possession of, all or any part of the Mortgaged Property together with the books, papers, and accounts of BMC pertaining thereto, and to hold, operate and manage the same, and from time to time to make all needed repairs and improvements as Mortgagee shall deem wise; and, if Mortgagee deems it necessary or desirable, to complete construction and equipping of any Improvements and in the course of such construction or equipping to make such changes to the same as it may deem desirable; and Mortgagee may sell the Mortgaged Property or any part thereof, or institute proceedings for the complete or partial foreclosure of the lien of this Mortgage on the Mortgaged Property, or lease the Premises or any part thereof in the name and for the account of Mortgagor or Mortgagee and collect, receive and sequester the rents, revenues, earnings, income, products and profits therefrom, and out of the same and any other monies received hereunder pay or provide for the payment of, all proper costs and expenses of taking, holding, leasing, selling and managing the same, including reasonable compensation to Mortgagee, its agents and counsel, and any charges of Mortgagee hereunder, and any taxes and other charges prior to the lien of this Mortgage which Mortgagee may deem it wise to pay.  The Receiver shall also be authorized to collect from BMC, and BMC agrees to pay, the fair rental value of BMC's use and occupancy of the Mortgaged Property.

6.         Payment of Real Estate Taxes.  BMC shall pay all taxes, assessments, sewer rents or water rates or sums due under any payment in lieu of tax agreement ("Pilot Agreement") and in default thereof, Mortgagee may pay the same.  In the event that Mortgagee shall pay any such tax, assessment, sewer rent, water rate or sums due under any Pilot Agreement, Mortgagee shall have the right, among other rights, to declare the amount so paid with interest thereon immediately due and payable, and upon default of BMC in paying any such amount with interest thereon, Mortgagee shall have the right, subject to the limitations contained in the definition of Secured Indebtedness hereinabove set forth, to foreclose for such amount as well as any amounts due under the Notes. 

In the event that BMC should fail to pay any sum BMC has agreed to pay pursuant to this covenant for a period in excess of forty-five (45) days after the same is due and payable, in addition to any other remedies available to Mortgagee hereunder, Mortgagee may, at its option, require that BMC deposit with Mortgagee, monthly, one-twelfth (1/12th) of the annual charges for taxes and any other sums BMC is obligated to pay pursuant to this covenant and BMC shall make such deposits with Mortgagee.  BMC shall simultaneously therewith deposit with Mortgagee a sum of money which together with the monthly installments aforementioned will be sufficient to make payment of all sums required to be paid hereunder at least thirty (30) days prior to the due date of such payments, it being understood that Mortgagee shall calculate the amount of such deposits and notify BMC of the sum due.  Should an Event of Default (hereinbelow defined) occur, the funds deposited with Mortgagee pursuant to this provision may be applied in payment of the charges for which said funds shall have been deposited or to the payment of any other sums secured by this Mortgage as Mortgagee sees fit.

7.         Payment of Mortgage Taxes.  BMC shall pay immediately all taxes, if any, imposed pursuant to Article 11 of the New York Tax Law or any other statute, order or regulation, whether said tax is imposed at the time of recording or subsequent thereto.  This obligation shall survive the satisfaction or other termination of this Mortgage.

8.        Sale in One Parcel.  In the event of a foreclosure of this Mortgage or any mortgage at any time consolidated with this Mortgage, Mortgagor agrees that Mortgagee shall be entitled to a judgment directing the referee appointed in the foreclosure proceeding to sell all of the parcels constituting the Mortgaged Property at one foreclosure sale, either as a group or separately and that the Mortgagor expressly waives any right that it may now have or hereafter acquire to (i) request or require that the parcels be sold separately or (ii) request, if Mortgagee has elected to sell parcels separately, that there be a determination of any deficiency amount after any such separate sale or otherwise require a calculation of whether said parcel or parcels separately sold were conveyed for their "fair market value".

 9.         Condemnation.   If any proceeding in eminent domain is commenced with respect to the Mortgage property, or any portion thereof, BMC shall give prompt written notice thereof  to Mortgagee and all condemnation awards to which Mortgagor may be entitled as a result of such condemnation or eminent domain proceeding shall be distributed and applied in accordance with the Credit Agreement.

10.         Maintenance and Use of Mortgaged Property.  BMC shall cause the Mortgaged Property to be maintained in a good and safe condition and repair.  The Improvements and the Equipment shall not be removed, demolished or materially altered (except for normal replacement of the Equipment in the ordinary course of business) without the consent of Mortgagee.  BMC shall promptly comply with all laws, orders and ordinances affecting the Mortgaged Property, or its use of the Mortgaged Property.  BMC shall not initiate, join in, acquiesce in, or consent to any change in any private restrictive covenant, zoning law or other public or private restriction, limiting or defining the uses which may be made of the Mortgaged Property or any part thereof.  If under applicable zoning provisions the use of all or any portion of the Mortgaged Property is or shall become a nonconforming use, BMC will not cause or permit such nonconforming use to be discontinued or abandoned without the express written consent of  Mortgagee.  BMC shall not (i) change the use of the Mortgaged Property, (ii) permit or suffer to occur any waste on or to the Mortgaged Property or to any portion thereof or (iii) take any steps whatsoever to convert the Mortgaged Property, or any portion thereof, to a condominium or cooperative form of management.  BMC will not install or permit to be installed on the Premises any underground storage tank.

11.         Transfer or Encumbrance of the Mortgaged Property.

(a)         Mortgagor shall not, without the prior written consent of Mortgagee, sell, convey, alienate, mortgage, encumber, pledge or otherwise transfer the Mortgaged Property or any part thereof, or permit the Mortgaged Property or any part thereof to be sold, conveyed, alienated, mortgaged, encumbered, pledged or otherwise transferred, provided, however, that the Agency may convey the Mortgaged Property to BMC, subject to this Mortgage and, upon providing Mortgagee with the prior written notice of same, in accordance with the Lease Agreement dated as of July 1, 1996 between BMC and the Agency (the "Agency Lease Agreement") without the Mortgagee's prior written consent.

(b)       A sale, conveyance, alienation, mortgage, encumbrance, pledge or transfer within the meaning of this Paragraph 11 shall be deemed to include, without limitation,(i) an installment sales agreement wherein Mortgagor agrees to sell the Mortgaged Property or any part thereof for a price to be paid in installments; (ii) an agreement by Mortgagor leasing all or a substantial part of the Mortgaged Property; and (iii) a sale, assignment or other transfer of, or the grant of a security interest in, Mortgagor's right, title and interest in and to any leases or any rents.

(c)         Mortgagee shall not be required to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Indebtedness immediately due and payable upon Mortgagor's sale, conveyance, alienation, mortgage, encumbrance, pledge or transfer of the Mortgaged Property without Mortgagee's consent.  This provision shall apply to every sale, conveyance, alienation, mortgage, encumbrance, pledge or transfer of the Mortgaged Property regardless of whether voluntary or not, or whether or not Mortgagee has consented to any previous sale, conveyance, alienation, mortgage, encumbrance, pledge or transfer of the Mortgaged Property.

(d)         Mortgagee's consent to one sale, conveyance, alienation, mortgage, encumbrance, pledge or transfer of the Mortgaged Property shall not be deemed to be a waiver of Mortgagee's right to require such consent to any future occurrence of same.  Any sale, conveyance, alienation, mortgage, encumbrance, pledge or transfer of the Mortgaged Property made in contravention of this paragraph shall be null and void and of no force and effect.

(e)         Mortgagee may withhold its consent in its sole discretion.

12.       Books and Records.  BMC shall keep and maintain at all times at BMC's address stated in this Mortgage, or such other place as Mortgagee may approve in writing, complete and accurate books of accounts and records adequate to reflect correctly the results of the operation of the Mortgaged Property and copies of all written contracts, leases and other instruments which affect the Mortgaged Property.  Such books, records, contracts, leases and other instruments shall be subject to examination and inspection at any reasonable time by Mortgagee, at Mortgagee's expense upon five (5) days prior notice, at BMC's office.

13.         Estoppel Certificates and No Default Affidavits.  After request by Mortgagee, BMC shall within ten (10) days furnish Mortgagee with a statement, duly acknowledged and certified, setting forth (i) the amount of the original principal amount of the Notes, (ii) the unpaid principal amount of the Notes, (iii) the rate of interest of the Notes, (iv) the date installments of interest and/or principal were last paid, (v) any offsets or defenses to the payment of the Indebtedness, if any, (vi) that the Notes, this Mortgage and the other Loan Documents are valid, legal and binding obligations and have not been modified or if modified, giving particulars of such modification; and (vii) reaffirming all representations and warranties of Mortgagor set forth herein and in the other Loan Documents as of the date requested by Mortgagee or, to the extent of any changes to any such representations and warranties, so stating such changes.

14.       Usury.  It is expressly stipulated and agreed to be the intent of BMC and Mortgagee at all times to comply with applicable state usury law or applicable United States federal usury law (to the extent that it permits Mortgagee to contract for, charge, take, reserve, or receive a greater amount of interest than under state law).  If the applicable law (state or federal) is ever judicially interpreted so as to render usurious any amount called for under the Notes or under any of the other Loan Documents, or contracted for, charged, taken, reserved, or received with respect to the Indebtedness, or if Mortgagee's exercise of the option to accelerate the maturity of the Notes, or if any prepayment by BMC results in BMC having paid any interest in excess of that permitted by applicable law, then it is BMC's and Mortgagee's express intent that all excess amounts theretofore collected shall be credited on the principal balance of the Notes and all other Indebtedness (or, if the Notes and all other Indebtedness have been or would thereby be paid in full, refunded to BMC), and the provisions of the Notes and the other Loan Documents immediately be deemed reformed and the amounts thereafter collectible hereunder and thereunder reduced, without the necessity of the execution of any new documents, so as to comply with the applicable law, but so as to permit the recovery of the fullest amount otherwise called for hereunder or thereunder.  

15.         Performance of Other Agreements.  BMC shall observe and perform each and every term to be observed or performed by Mortgagor pursuant to the terms of any agreement or recorded instrument affecting or pertaining to the Mortgaged Property.

16.       Further Acts, Etc.  Mortgagor will, at the cost of BMC, and without expense to Mortgagee, do, execute, acknowledge and deliver all and every such further acts, deeds, conveyances, mortgages, assignments, notices of assignment, Uniform Commercial Code financing statements or continuation statements, transfers and assurances as Mortgagee shall, from time to time, require, for the better assuring, conveying, assigning, transferring, and confirming unto Mortgagee the property and rights hereby deeded, mortgaged, given, granted, bargained, sold, alienated, conveyed, confirmed, pledged, assigned and hypothecated or intended now or hereafter so to be, or which Mortgagor may be or may hereafter become bound to convey or assign to Mortgagee, or for carrying out the intention or facilitating the performance of the terms of this Mortgage or for filing, registering or recording this Mortgage.  Mortgagor, on demand, will execute and deliver and hereby authorizes Mortgagee to execute in the name of Mortgagor or without the signature of Mortgagor to the extent Mortgagee may lawfully do so, one or more financing statements, chattel mortgages or other instruments, to evidence more effectively the security interest of Mortgagee in the Mortgaged Property.  Upon foreclosure, the appointment of a receiver or any other relevant action, Mortgagor will, at the cost of BMC and without expense to Mortgagee, cooperate fully and completely to effect the assignment or transfer of any license, permit, agreement or any other right necessary or useful to the operation of or the Mortgaged Property.  Mortgagor grants to Mortgagee an irrevocable power of attorney coupled with an interest for the purpose of exercising and perfecting any and all rights and remedies available to Mortgagee at law and in equity, including, without limitation, such rights and remedies available to Mortgagee pursuant to this paragraph.

17.         Recording of Mortgage, Etc.  BMC forthwith upon the execution and delivery of this Mortgage and thereafter, from time to time, will cause this Mortgage, and any security instrument creating a lien or security interest or evidencing the lien hereof upon the Mortgaged Property and each instrument of further assurance to be filed, registered or recorded in such manner and in such places as may be required by any present or future law in order to publish notice of and fully to protect the lien or security interest hereof upon, and the interest of Mortgagee in, the Mortgaged Property.  BMC will pay all filing, registration or recording fees, and all expenses incident to the preparation, execution and acknowledgment of this Mortgage, any mortgage supplemental hereto, any security instrument with respect to the Mortgaged Property and any instrument of further assurance, and all federal, state, county and municipal, taxes, duties, imposts, assessments and charges arising out of or in connection with the execution and delivery of this Mortgage, any mortgage supplemental hereto, any security instrument with respect to the Mortgaged Property or any instrument of further assurance, except where prohibited by law so to do.  BMC shall hold harmless and indemnify Mortgagee, its successors and assigns, against any liability incurred by reason of the imposition of any tax on the making and recording of this Mortgage.

18.         Reporting Requirements.  BMC agrees to give prompt notice to Mortgagee of the insolvency or bankruptcy filing of BMC or the insolvency or bankruptcy filing of any guarantor of the Indebtedness.

19.       Events of Default.  The Indebtedness under the Notes shall become immediately due and payable at the option of Mortgagee upon the happening of any one or more of the following events of default (each an "Event of Default"):

(a)       an Event of Default shall have occurred under any of the Notes or under any Loan Document, including, if applicable the expiration of any grace period provided thereon;

(b)       failure of Mortgagor to perform or observe any covenant, agreement, representation, warranty or other provision contained in this Mortgage;

(c)       if any representation or warranty of BMC made herein or in any certificate, report, or other instrument or document furnished to BMC hereunder shall have been false or misleading in any material respect when made;

(d)       if BMC shall be in default under any other mortgage or security agreement covering any part of the Mortgaged Property whether it be superior or junior in lien to this Mortgage;

(e)       if the Mortgaged Property becomes subject to any mechanic's, materialman's or other lien and such lien is not removed of record within thirty (30) days of the filing or recording of such lien (except a lien for local real estate taxes and assessments not then due and payable); or

(f)       if BMC ceases to continuously use the Mortgaged Property or any material portion thereof for any reason whatsoever (other than temporary cessation in connection with any repair or renovation thereof undertaken with the consent of Mortgagee).

20.       Right To Cure Defaults.  Upon the occurrence of any Event of Default or if BMC fails to make any payment (including, without limitation, any required payments for taxes, insurance or to discharge any liens with respect to the Property) or to do any act as herein provided, Mortgagee may, but without any obligation to do so and without notice to or demand on BMC and without releasing BMC from any obligation hereunder, make or do the same in such manner and to such extent as Mortgagee may deem necessary to protect the security hereof.  Mortgagee is authorized to enter upon the Mortgaged Property for such purposes or appear in, defend, or bring any action or proceeding to protect its interest in the Mortgaged Property or to foreclose this Mortgage, and the cost and expense thereof (including reasonable attorneys' fees and disbursements to the extent permitted by law), with interest at the highest rate provided in the Notes for the period after notice from Mortgagee that such cost or expense was incurred to the date of payment, shall constitute a portion of the Indebtedness, subject to the limitations contained in the definition of Secured Indebtedness hereinabove set forth, shall be secured by this Mortgage and shall be due and payable upon demand.  

21.         Additional Remedies.

(a)       Upon the occurrence of any Event of Default, Mortgagee may take such action, without notice or demand, as it deems advisable to protect and enforce its rights against Mortgagor and in and to the Mortgaged Property by Mortgagee itself or otherwise, and Mortgagee may take the following additional actions, each of which may be pursued concurrently or otherwise, at such time and in such order as they may determine, in their sole discretion, without impairing or otherwise affecting their other rights and remedies:

(i)       declare the entire Indebtedness to be immediately due and payable;

(ii)       institute a proceeding or proceedings, judicial or nonjudicial, by advertisement or otherwise, for the complete foreclosure of this Mortgage in which case the Mortgaged Property or any interest therein may be sold for cash or upon credit in one or more parcels or in several interests or portions and in any order or manner, reserving Mortgagee's right to seek a deficiency judgment against BMC;

(iii)       with or without entry, to the extent permitted and pursuant to the procedures provided by applicable law, institute proceedings for the partial foreclosure of this Mortgage for the portion of the Indebtedness then due and payable, subject to the continuing lien of this Mortgage for the balance of the Indebtedness not then due;

(iv)      sell for cash or upon credit the Mortgaged Property or any part thereof and all estate, claim, demand, right, title and interest of Mortgagor therein and rights of redemption thereof, pursuant to the power of sale contained herein or otherwise, at one or more sales, as an entirety or in parcels, at such time and place, upon such terms and after such notice thereof as may be required or permitted by law;

(v)       institute an action, suit or proceeding in equity for the specific performance of any covenant, condition or agreement contained herein, or in any of the other Loan Documents;

(vi)      recover judgment on the Notes either before, during or after any proceedings for the enforcement of this Mortgage;

(vii)      apply for the appointment of a trustee, receiver, liquidator or conservator of the Mortgaged Property, without notice and without regard for the adequacy of the security for the Obligations and without regard for the solvency of BMC, any Guarantor or of any person, firm or other entity liable for the payment of the Obligations;

(viii)     sell all or any portion of the Mortgaged Property pursuant to Article 14 of New York's Real Property Actions and Proceedings Law; and

(ix)      pursue such other rights and remedies as may be available at law or in equity or under the Uniform Commercial Code including without limitation the right to receive Rents and any other receivables or rights to payments of BMC relating to the Mortgaged Property.

In the event of a sale, by foreclosure or otherwise, of less than all of the Mortgaged Property, this Mortgage shall continue as a lien on the remaining portion of the Mortgaged Property.

(b)       The proceeds of any sale made under or by virtue of this paragraph, together with any other sums which then may be held by Mortgagee under this Mortgage, whether under the provisions of this paragraph or otherwise, shall be applied by Mortgagee to the payment of the Indebtedness in the manner set forth in  the Credit Agreement.

(c)         Mortgagee may adjourn from time to time any sale by it to be made under or by virtue of this Mortgage by announcement at the time and place appointed for such sale or for such adjourned sale or sales; and, except as otherwise provided by any applicable provision of law, Mortgagee, without further notice or publication, may make such sale at the time and place to which the same shall be so adjourned.

(d)       Upon the completion of any sale or sales pursuant hereto, Mortgagee, or an officer of any court empowered to do so, shall execute and deliver to the accepted purchaser or purchasers a good and sufficient instrument, or good and sufficient instruments, conveying, assigning and transferring all estate, right, title and interest in and to the property and rights sold.  Mortgagee is hereby irrevocably appointed the true and lawful attorney of Mortgagor, in its name and stead, to make all necessary conveyances, assignments, transfers and deliveries of the Mortgaged Property and rights so sold and for that purpose Mortgagee may execute all necessary instruments of conveyance, assignment and transfer, and may substitute one or more persons with like power, Mortgagor hereby ratifying and confirming all that its said attorney or such substitute or substitutes shall lawfully do by virtue hereof.  Any sale or sales made under or by virtue of this paragraph, whether made under the power of sale herein granted or under or by virtue of judicial proceedings or of a judgment or decree of foreclosure and sale, shall operate to divest all the estate, right, title, interest, claim and demand whatsoever, whether at law or in equity, of Mortgagor in and to the properties and rights so sold, and shall be a perpetual bar both at law and in equity against Mortgagor and against any and all persons claiming or who may claim the same, or any part thereof from, through or under Mortgagor.

(e)       Upon any sale made under or by virtue of this paragraph, whether made under the power of sale herein granted or under or by virtue of judicial proceedings or of a judgment or decree of foreclosure and sale, Mortgagee may bid for and acquire the Mortgaged Property or any part thereof and in lieu of paying cash therefor may make settlement for the purchase price by crediting upon the Indebtedness the net sales price after deducting therefrom the expenses of the sale and costs of the action and any other sums which Mortgagee is authorized to deduct under this Mortgage.

(f)       No recovery of any judgment by Mortgagee and no levy of an execution under any judgment upon the Mortgaged Property or upon any other property of BMC shall affect in any manner or to any extent the lien of this Mortgage upon the Mortgaged Property or any part thereof, or any liens, rights, powers or remedies of Mortgagee hereunder, but such liens, rights, powers and remedies of Mortgagee shall continue unimpaired as before.

(g)         Mortgagee may terminate or rescind any proceeding or other action brought in connection with its exercise of the remedies provided in this paragraph at any time before the conclusion thereof, as determined in Mortgagee's sole discretion and without prejudice to Mortgagee.

(h)         Mortgagee may resort to any remedies and the security given by the Notes, this Mortgage or the other Loan Documents in whole or in part, and in such portions and in such order as determined by their sole discretion.  No such action shall in any way be considered a waiver of any rights, benefits or remedies evidenced or provided by the Notes, this Mortgage or any of the other Loan Documents.  The failure to exercise any right, remedy or option provided in the Notes, this Mortgage or any of the other Loan Documents shall not be deemed a waiver of such right, remedy or option or of any covenant or obligation secured by the Notes, this Mortgage or the other Loan Documents.  No acceptance by Lenders of any payment after the occurrence of any Event of Default and no payment by Mortgagee of any obligation for which BMC is liable hereunder shall be deemed to waive or cure any Event of Default with respect to BMC, or BMC's liability to pay such obligation.  No sale of all or any portion of the Mortgaged Property, no forbearance on the part of Mortgagee, and no extension of time for the payment of the whole or any portion of the Indebtedness or any other indulgence given by Mortgagee to BMC, shall operate to release or in any manner affect the interest of Mortgagee in the remaining Mortgaged Property or the liability of BMC to pay the Indebtedness.  No waiver by Mortgagee shall be effective unless it is in writing and then only to the extent specifically stated.  All costs and expenses of Mortgagee in exercising the rights and remedies under this Paragraph 21 (including reasonable attorneys' fees and disbursements to the extent permitted by law), shall be paid by BMC immediately upon notice from Mortgagee, with interest at the highest rate provided in any of the Notes for the period after notice from Mortgagee and, subject to the limitations contained in the definition of Secured Indebtedness hereinabove set forth, such costs and expenses shall constitute a portion of the Indebtedness and shall be secured by this Mortgage.

(i)       The interests and rights of Mortgagee under this Mortgage or in any of the other Loan Documents shall not be impaired by any indulgence, including (i) any renewal, extension or modification which Mortgage may grant with respect to any of the Indebtedness, (ii) any surrender, compromise, release, renewal, extension, exchange or substitution which Mortgagee may grant with respect to the Mortgaged Property or any portion thereof; or (iii) any release or indulgence granted to any maker, endorser, guarantor or surety of any of the Indebtedness.

(j)       The rights and remedies herein afforded to Mortgagee and the Lenders shall be cumulative and supplementary to and not exclusive of any other rights and remedies afforded the Mortgagee.

22.       Right of Entry.  In addition to any other rights or remedies granted under this Mortgage, Mortgagee, and its agents, during the Term, shall have the right to enter and inspect the Mortgaged Property during normal business hours.  The cost of such inspections or audits shall be borne by BMC, including the cost of all follow up or additional investigations or inquiries deemed reasonably necessary by Mortgagee.  The cost of such inspections, if not paid for by BMC following demand, shall bear interest thereafter until paid at the highest rate set forth in any of the Notes.

23.         Security Agreement.

(a)       This Mortgage is both a real property mortgage and a "security agreement" within the meaning of the Uniform Commercial Code.  The Mortgaged Property includes both real and personal property and all other rights and interests, whether tangible or intangible in nature, of Mortgagor in the Mortgaged Property.  Mortgagor, by executing and delivering this Mortgage, has granted and hereby grants to Mortgagee, as security for the Indebtedness, a security interest in the Mortgaged Property to the full extent that the Mortgaged Property may be subject to the Uniform Commercial Code (said portion of the Mortgaged Property so subject to the Uniform Commercial Code being called in this paragraph the "Collateral"). This Mortgage shall also constitute a "fixture filing" for the purposes of the Uniform Commercial Code.  As such, this Mortgage covers all items of the Collateral that are or are to become fixtures.  Information concerning the security interest herein granted may be obtained from the parties at the addresses of the parties set forth in the first paragraph of this Mortgage.

(b)       If an Event of Default shall occur, Mortgagee, in addition to any other rights and remedies which it may have, shall have and may exercise immediately and without demand, any and all rights and remedies granted to a secured party upon default under the Uniform Commercial Code, including, without limiting the generality of the foregoing, the right to take possession of the Collateral or any part thereof, and to take such other measures as Mortgagee may deem necessary for the care, protection and preservation of the Collateral.  Upon request or demand of Mortgagee, BMC shall at its expense assemble the Collateral and make it available to Mortgagee at a convenient place acceptable to Mortgagee.  BMC shall pay to Mortgagee on demand any and all expenses, including attorneys' fees and disbursements, incurred or paid by Mortgagee in protecting the interest in the Collateral and in enforcing the rights hereunder with respect to the Collateral.  Any notice of sale, disposition or other intended action by Mortgagee with respect to the Collateral sent to Mortgagor in accordance with the provisions hereof at least ten (10) days prior to such action, shall constitute commercially reasonable notice to BMC.  The proceeds of any disposition of the Collateral, or any part thereof, shall be applied by Mortgagee to the payment of the Indebtedness in such manner as may be provided in the Credit Agreement.  In the event of any change in name, identity or structure of any Mortgagor, such Mortgagor shall notify Mortgagee thereof and promptly after request shall execute, file and record such Uniform Commercial Code forms as are necessary to maintain the priority of Mortgagee's lien upon and security interest in the Collateral, and BMC shall pay all expenses and fees in connection with the filing and recording thereof.  If Mortgagee shall require the filing or recording of additional Uniform Commercial Code forms or continuation statements, Mortgagor shall, at BMC's expense, promptly after request, execute, file and record such Uniform Commercial Code forms or continuation statements as Mortgagee shall deem necessary, and BMC shall pay all expenses and fees in connection with the filing and recording thereof.  Mortgagor hereby irrevocably appoints Mortgagee as its attorney-in-fact, coupled with an interest, to file with the appropriate public office on its behalf any financing or other statements signed only by Mortgagee, as secured party, in connection with the Collateral covered by this Mortgage.

24.       Waiver of Setoff and Counterclaim.  All amounts due under this Mortgage, the Notes and the other Loan Documents shall be payable without setoff, counterclaim or any deduction whatsoever.  Mortgagor hereby waives the right to assert a setoff, counterclaim (other than a mandatory or compulsory counterclaim) or deduction in any action or proceeding in which Mortgagee is a participant, or arising out of or in any way connected with this Mortgage, the Notes, any of the other Loan Documents or the Indebtedness.

25.         Recovery of Sums Required to be Paid.  The Mortgagee shall have the right from time to time to take action to recover any sum or sums which constitute a part of the Indebtedness as the same become due, without regard to whether or not the balance of the Indebtedness shall be due, and without prejudice to the right of Mortgagee thereafter to bring an action of foreclosure, or any other action, for a default or defaults by Mortgagor existing at the time such earlier action was commenced.

26.         Marshalling and Other Matters.  Mortgagor hereby waives, to the extent permitted by law, the benefit of all appraisement, valuation, stay, extension, reinstatement and redemption laws now or hereafter in force and all rights of marshalling in the event of any sale hereunder of the Mortgaged Property or any part thereof or any interest therein.  Further, Mortgagor hereby expressly waives any and all rights of redemption from sale under any order or decree of foreclosure of this Mortgage on behalf of Mortgagor, and on behalf of each and every person acquiring any interest in or title to the Mortgaged Property subsequent to the date of this Mortgage and on behalf of all persons to the extent permitted by applicable law.

27.         Hazardous Substances.  The Mortgagor shall not use, or permit the use of, the Mortgaged Property for the handling, storage, transportation, manufacture, release or disposal of any Hazardous Substances.  In addition, the Mortgagor shall not install or maintain, or permit the installation or maintenance of, any above-ground or underground storage tanks for the storage of petroleum, petroleum by-products or other Hazardous Substances in, about or under the Mortgaged Property unless (a) the Mortgagor has obtained the prior written consent of the Mortgagee for such installation and maintenance and (b) the Mortgagor installs and maintains such above-ground or underground storage tanks in compliance with all applicable Environmental Laws.  Notwithstanding the foregoing, the Mortgagor or any tenant of the Mortgagor may use or store immaterial amounts of commonly known and used materials which may be deemed Hazardous Substances hereunder, provided that any such use or storage (i) does not constitute a remunerative activity of the Mortgagor or any tenant, (ii) is incidental to the Mortgagor's or such tenant's primary use of the Mortgaged Property and does not constitute a primary use thereof, and (iii) complies at all times with all applicable Environmental Laws.  "Hazardous Substances" means any Contaminant (as defined in the Credit Agreement), asbestos, ureaformaldehyde, polychlorinated biphenyls, nuclear fuel or material, chemical waste, radioactive material, explosives, known carcinogens, petroleum products and by-products and other dangerous, toxic or hazardous pollutants, contaminants, chemicals, materials or substances listed or identified in, or regulated by, any Environmental Laws.  Each of the agreements set forth in Section 7.9 of the Credit Agreement are hereby incorporated by reference herein with the same effect as if such agreements had been set forth herein.

28.         Conflicts with Credit Agreement.  Notwithstanding anything in this Mortgage to the contrary, in the event of a conflict or patent inconsistency between the terms of this Mortgage and the Credit Agreement, the terms of the Credit Agreement shall govern and apply.

29.         Notices.  Any notice, report, demand or other instrument authorized or required to be given or furnished ("Notices") shall be in writing and shall be given as follows:  (a) by hand delivery; (b) by deposit in the United States mail as first class certified mail, return receipt requested, postage paid; (c) by overnight nationwide commercial courier service; or (d) by telecopy transmission (other than for notices of default) with a confirmation copy to be delivered by duplicate notice in accordance with any of clauses (a)- (c) above, in each case, addressed to the party intended to receive the same at the following address(es):

Mortgagee:                   Deutsche Bank Trust Company Americas
233 South Wacker Drive, 84th Floor
Chicago, Illinois  60606
Attn:  John Anos
Telecopy No.:  (312) 993-8162

With a copy to:             Winston & Strawn
35 West Wacker Drive
Chicago, Illinois  60601
Attn.:  Charles B. Boehrer, Esq.
Telecopy No.:  (312) 558-5700

Agency:                        Cortland County Industrial Development Agency
34 Tompkins Street
Cortland,  New York 13045
Attn: Executive Director
Telecopy No.: (607) 756-7901

With a copy to:             Riehlman, Shafer & Shafer
397 Route 281
P.O. Box 430
Tully, New York 13159
Attn:  John P. Sidd, Esq.
Telecopy No.: (315) 696-6019
 

BMC:                          BMC Industries, Inc.
P.O. Box 189
Kellogg Road
Cortland, New York 13045
Attn: Treasurer

with a copy to:              Jon Dobson, Esq.
Vice President, General Counsel
BMC Industries, Inc.
One Meridan Crossings
Suite 850
Minneapolis, MN 55423
Telecopy No.:  (952) 851-6050

Any party may change the address to which any such Notice is to be delivered, by furnishing ten (10) days written notice of such change to the other parties in accordance with the provisions of this Paragraph 29.  Notices shall be deemed to have been given on the date they are actually received; provided, that the inability to deliver Notices because of a changed address of which no Notice was given, or rejection or refusal to accept any Notice offered for delivery shall be deemed to be receipt of the Notice as of the date of such inability to deliver or rejection or refusal to accept delivery.  Notice for either party may be given by its respective counsel.

30.       Waiver of Notice.  Mortgagor shall not be entitled to any notices of any nature whatsoever from Mortgagee except with respect to matters for which this Mortgage specifically and expressly provides for the giving of notice by Mortgagee to Mortgagor and except with respect to matters for which Mortgagee is required by applicable law to give notice, and Mortgagor hereby expressly waives the right to receive any notice from Mortgagee with respect to any matter for which this Mortgage does not specifically and expressly provide for the giving of notice by Mortgagee to Mortgagor.

31.       Sole Discretion of Mortgagee.  Wherever pursuant to this Mortgage, Mortgagee exercises any right given to it to consent or not consent or approve or disapprove, or any arrangement or term is to be satisfactory to Mortgagee, the decision of Mortgagee to consent or not consent, to approve or disapprove or to decide that arrangements or terms are satisfactory or not satisfactory shall be in the sole discretion of Mortgagee and shall be final and conclusive, except as may be otherwise expressly and specifically provided herein.

32.       Non-Waiver.  The failure of Mortgagee to insist upon strict performance of any term hereof shall not be deemed to be a waiver of any term of this Mortgage.  Mortgagor shall not be relieved of Mortgagor's obligations hereunder by reason of (a) the failure of Mortgagee or Lenders to comply with any request of Mortgagor to take any action to foreclose this Mortgage or otherwise enforce any of the provisions hereof or of the Notes, or the other Loan Documents, (b) the release, regardless of consideration, of the whole or any part of the Mortgaged Property, or of any person liable for the Indebtedness or any portion thereof, or (c) any agreement or stipulation by Mortgagee or Lenders extending the time of payment or otherwise modifying or supplementing the terms of the Notes, this Mortgage or any of the other Loan Documents.  Mortgagee and the Lenders may resort for the payment of the Indebtedness to any other security held by them in such order and manner as they, in their sole discretion, may elect.  Mortgagee and the Lenders may take action to recover the Indebtedness, or any portion thereof, or to enforce any covenant hereof without prejudice to the right of Mortgagee thereafter to foreclosure this Mortgage.  The rights and remedies of Mortgagee under this Mortgage shall be separate, distinct and cumulative and none shall be given effect to the exclusion of the others.  No act of Mortgagee or the Lenders shall be construed as an election to proceed under any one provision herein to the exclusion of any other provision.  Mortgagee and the Lenders shall not be limited exclusively to the rights and remedies herein stated but shall be entitled to every right and remedy now or hereafter afforded at law or in equity.

33.       No Oral Change.  This Mortgage, and any provisions hereof, may not be modified, amended, waived, extended, changed, discharged or terminated orally or by any act or failure to act on the part of Mortgagor or Mortgagee, but only by an agreement in writing signed by the party against whom enforcement of any modification, amendment, waiver, extension, change, discharge or termination is sought.

34.         Liability.  Subject to the provisions contained in Paragraph 55 of this Mortgage, if Mortgagor consists of more than one person, the obligations and liabilities of each such person hereunder shall be joint and several.  Subject to the provisions hereof requiring Mortgagee's consent to any transfer of the Mortgaged Property, this Mortgage shall be binding upon and inure to the benefit of Mortgagor and Mortgagee and their respective successors and assigns forever.

35.         Inapplicable Provisions.  If any term, covenant or condition of this Mortgage is held to be invalid, illegal or unenforceable in any respect, this Mortgage shall be construed without such provision.

36.         Headings, Etc.  The headings and captions of various paragraphs of this Mortgage are for convenience of reference only and are not to be construed as defining or limiting, in any way, the scope or intent of the provisions hereof.

37.         Definitions.  Unless the context clearly indicates a contrary intent or unless otherwise specifically provided herein, words used in this Mortgage may be used interchangeably in singular or plural form and the word "Mortgagor" shall mean "each Mortgagor and any subsequent owner or owners of the Mortgaged Property or any part thereof or any interest therein," the word "Mortgagee" shall mean "Mortgagee and any subsequent Administrative Agent under the Credit Agreement," the word "Notes" shall mean "any of the Notes and any other evidence of indebtedness secured by this Mortgage," the word "person" shall include an individual, corporation, partnership, trust, unincorporated association, government, governmental authority, and any other entity, and the words "Mortgaged Property" shall include any portion of the Mortgaged Property and any interest therein and the words "attorneys' fees" shall include any and all attorneys' fees, paralegal and law clerk fees, including, without limitation, fees at the pre-trial, trial and appellate levels incurred or paid by Mortgagee in protecting its interest in the Mortgaged Property and Collateral and enforcing its rights hereunder.  Whenever the context may require, any pronouns used herein shall include the corresponding masculine, feminine or neuter forms, and the singular form of nouns and pronouns shall include the plural and vice versa.

38.       Actions and Proceedings.  If any action or proceeding be commenced to which action or proceeding Mortgagee is made a party and in which it becomes necessary in the opinion of Mortgagee to defend or uphold the lien of this Mortgage, all sums paid by Mortgagee for the expense of any litigation to prosecute and defend the rights and lien created by this Mortgage, including reasonable counsel fees, costs and allowances, shall, together with interest thereon be a lien on the Mortgaged Property and, subject to the limitations contained in the definition of Secured Indebtedness hereinabove set forth, secured by this Mortgage and shall be collectible in like manner as said indebtedness and shall be paid by BMC upon receipt of an invoice from Mortgagee.

39.       Leases of the Mortgaged Property.  Mortgagor will not enter into any lease(s) for all or any portion of the Mortgaged Property other than the Agency Lease Agreement without the prior written consent of Mortgagee.

40.       Real Property Law.  All covenants hereof, which are in addition to those set forth in Sections 254 and 291-f of the New York Real Property Law, shall be construed as affording to Mortgagee rights additional to, and not exclusive of, the rights conferred under the provisions of said Sections 254 and 291-f.

41.         Successors.  All of the provisions of this Mortgage shall inure to the benefit of Mortgagee and of any subsequent holder of this Mortgage and shall be binding upon Mortgagor and each subsequent owner of the Mortgaged Property.

42.       Effect of Releases.  Mortgagee, without notice, may release any part of the security described herein, or any person or entity liable for any Indebtedness without in any way affecting the lien hereof upon any part of the security not expressly released, and may agree with any party obligated on said Indebtedness or having any interest in the security described herein to extend the time for payment of any part or all of the Indebtedness.  Such agreement shall not in any way release or impair the lien hereof, but shall extend the lien hereof as against the title of all parties having any interest in said security, which interest is subject to said lien, and no such release or agreement shall release any person or entity obligated to pay any Indebtedness.

43.         Mortgagee Not Obligated.  Nothing herein contained shall be construed as making the payment of any insurance premiums, taxes or assessments obligatory upon Mortgagee, although Mortgagee may pay same, or as making Mortgagee liable in any way for loss, damage or injury, resulting from the non-payment of any such insurance premiums, taxes or assessments.

44.       Lien Law.  BMC will, in compliance with Section 13 of the New York Lien Law, receive the advances secured by this Mortgage and will hold the right to receive such advances as a trust fund to be applied first for the purpose of paying the cost of the improvement and will apply the same first to the payment of the cost of the improvement before using any part of the total of the same for any other purpose.

45.       Costs, Expenses and Attorney's Fees.  Should one or more Events of Default occur hereunder, and should an action be commenced for the foreclosure of this Mortgage, Mortgagee shall be entitled to recover all sums due hereunder, statutory costs, and any additional allowances made pursuant to Section 8303(a) of the Civil Practice Law and Rules of the State of New York, and in addition thereto, reasonable attorneys' fees in such proceeding and in all proceedings related thereto necessary to and related to the foreclosing proceeding, and such amount shall be paid by BMC on demand and shall be a lien on the Mortgaged Property prior to any right or title to, interest in or claim upon the Mortgaged Property attaching and accruing subsequent to the lien of this Mortgage, and shall be deemed to be secured by this Mortgage and the indebtedness which it secures.

46.       Entire Agreement. This Mortgage constitutes the entire understanding between Mortgagor and Mortgagee relative to the granting of a mortgage lien on the Mortgaged Property and supersedes any prior writings or oral statements or conversations at any time made or had with respect thereto.

47.         Governing Law; Severability. This Mortgage shall be governed by the law of the jurisdiction in which the Mortgaged Property is located.  In the event that any provision or clause of this Mortgage conflicts with applicable law, such conflict shall not affect other provisions of this Mortgage which can be given effect without the conflicting provision, and to this end, the provisions of this Mortgage are declared to be severable.

48.       Time of the Essence. Time is of the essence with respect to each and every covenant, agreement and obligation of Mortgagor under this Mortgage.

49.         WAIVER OF JURY TRIAL.  MORTGAGOR AND MORTGAGEE HEREBY WAIVE TRIAL BY JURY IN ANY LITIGATION IN ANY COURT WITH RESPECT TO, IN CONNECTION WITH, OR ARISING OUT OF THIS MORTGAGE OR THE VALIDITY, PROTECTION, INTERPRETATION, COLLECTION OR ENFORCEMENT HEREOF, OR THE RELATIONSHIP BETWEEN MORTGAGOR AND MORTGAGEE OR ANY OTHER CLAIM OR DISPUTE HOWSOEVER ARISING BETWEEN MORTGAGOR AND MORTGAGEE ARISING UNDER THIS MORTGAGE.

50.       Tax Law Section 253 Statement. This Mortgage does not cover real property principally improved or to be improved by one or more structures containing in the aggregate not more than six residential dwelling units, each having their own separate cooking facilities.

51.         Execution of Counterparts.  This Agreement may be executed in one or more counterparts, any one or all of which shall constitute but one agreement.

52.         No Recourse; Special Obligation.

(a)         The obligations and agreements of the Agency contained herein and any other instrument or document executed in connection therewith or herewith, and any other instrument or document supplemental thereto or hereto, shall be deemed the obligations and agreements of the Agency, and not of any member, officer, director, agent (other than BMC) or employee of the Agency in his individual capacity, and the members, officers, directors, agents (other than BMC) and employees of the Agency shall not be liable personally hereon or thereon or be subject to any personal liability or accountability based upon or in respect hereof or thereof or of any transaction contemplated hereby or thereby.

(b)         The obligations and agreements of the Agency contained herein and therein shall not constitute or give rise to an obligation of the State of New York or Cortland County, New York, and neither the State of New York nor Cortland County, New York shall be liable hereon or thereon, and, further, such obligations and agreements shall not constitute or give rise to a general obligation of the Agency, and Mortgagee shall have no recourse to the Agency other than the Agency's interests in the Mortgaged Property, including, but not limited to, the revenues derived and to be derived from the sale or other disposition of the Real Property.  This Mortgage is specifically subordinate to the exercise by the Agency of the following rights (the "Agency's Reserved Rights") under the Agency Lease Agreement:  The right to (a) receive in its own behalf all opinions of counsel, reports, statements, certificates, insurance policies or binders or certificates, or other communications required to be delivered by BMC to the Agency; (b) grant or withhold any consents or approvals required of the Agency; (c) to enforce or otherwise exercise in its own behalf all agreements of BMC with respect to ensuring that the Mortgaged Property shall always constitute a qualified "project" as defined in and as contemplated by the Act (as that term is defined in the Agency Lease Agreement); (d) to amend with BMC the provisions of the Payment in Lieu of Tax Agreement (as that term is defined in the Agency Lease Agreement); (e) to enforce in its own behalf (or on behalf of the appropriate taxing authorities) the provisions of, and receive amounts payable under the Payment in Lieu of Tax Agreement and Sections 5.3, 8.9, 10.2 and 10.4 of the Agency Lease Agreement; (f) to be indemnified pursuant to Section 8.2 of the Agency Lease Agreement; (g) to terminate the Agency Lease Agreement in accordance with its terms; and (h) to reconvey the Mortgaged Property to Borrower in accordance with the terms of the Agency Lease Agreement.  The Agency's Reserved Rights are not pledged to the Mortgagee hereunder and are reserved to the Agency and the contractual obligations of BMC with respect to the Agency's Reserved Rights shall survive a foreclosure of this Mortgage.

(c)         No order or decree of specific performance with respect to any of the obligations of the Agency hereunder shall be sought or enforced against the Agency unless (1) the party seeking such order or decree shall first have requested the Agency in writing to take the action sought in such order or decree of specific performance, and thirty (30) days shall have elapsed from the date of receipt of such request, and the Agency shall have refused to comply with such request (or, if compliance therewith would reasonably be expected to take longer than thirty (30) days, shall have failed to institute and diligently pursue action to cause compliance with such request within such ten day period) or failed to respond within such notice period, (2) if the Agency refuses to comply with such request and the Agency's refusal to comply is based on its reasonable expectation that it will incur fees and expenses, the party seeking such order or decree shall have placed in an account with the Agency an amount or undertaking sufficient to cover such reasonable fees and expenses, and (3) if the Agency refuses to comply with such request and the Agency's refusal to comply is based on its reasonable expectation that it or any of its members, officers, agents (other than BMC) or employees shall be subject to potential liability, the party seeking such order or decree shall (a) agree to indemnify, defend and hold harmless the Agency and its members, officers, directors, agents (other than BMC) and employees against any liability incurred as a result of its compliance with such demand, and (b) if requested by the Agency, furnish to the Agency satisfactory security to protect the Agency and its members, officers, directors, agents (other than BMC) and employees against all liability expected to be incurred as a result of compliance with such request.  Any failure to provide the indemnity and/or security required in this Section 52(c) shall not affect the full force and effect of an Event of Default hereunder.

53.         New York State Specific Provisions.

(a)         Inconsistencies.  In the event of any inconsistencies between the terms and conditions of this Section 53 and the other provisions of this Mortgage, the terms and conditions of this Section 53 shall control and be binding.

(b)         Insurance.  The provisions of subsection 4 of Section 254 of the New York Real Property Law covering the insurance of buildings against loss by fire shall not apply to this Mortgage.  In the event of any conflict, inconsistency or ambiguity between the provisions of this Mortgage and the provisions of subsection 4 of Section 254 of the New York Real Property Law covering the insurance of buildings against loss by fire, the provisions of the Mortgage shall control.

(c)      Leases.  Mortgagee shall have all of the rights against lessees of the Mortgaged Property set forth in Section 291-f of the Real Property Law of New York.

(d)         Statutory Construction.  The clauses and covenants contained in this Mortgage that are construed by Section 254 of the New York Real Property Law shall be construed as provided in those sections (except as provided in Section 53(b)).  The additional clauses and covenants contained in this Mortgage shall afford rights supplemental to and not exclusive of the rights conferred by the clauses and covenants construed by Section 254 and shall not impair, modify, alter, or defeat such rights (except as provided in Section 53(b)), notwithstanding that such additional clauses and covenants may relate to the same subject matter or provide for different or additional rights in the same or similar contingencies as the clauses and covenants construed by Section 254.  The rights of Mortgagee arising under the clauses and covenants contained in this Mortgage shall be separate, distinct, and cumulative and none of them shall be in exclusion of the others.  No act of Mortgagee or any of the Lenders shall be construed as an election to proceed under any one provision herein to the exclusion of any other provision, anything herein or otherwise to the contrary notwithstanding.  In the event of any inconsistencies between the provisions of Section 254 and the provisions of this Mortgage, the provisions of this Mortgage shall prevail.

(e)      Power of Sale.  Upon the occurrence of an Event of Default, Mortgagee shall have the right to sell the Mortgaged Property, including, without limitation, by exercise of any and all rights and remedies available under Article 14 of the New York Real Property Actions and Proceedings Law (the "RPAPL").  Any deed or deeds executed and delivered in connection with the sale or sales of the Mortgaged Property pursuant to Article 14 of the RPAPL shall be in the form provided in Article 14 of the RPAPL.

[Remainder of page intentionally left blank]

IN WITNESS WHEREOF, this Mortgage has been duly executed as of the 27th day of September, 2002.

BMC INDUSTRIES, INC.

By:  /s/Bradley D. Carlson               
                               Bradley D. Carlson

CORTLAND COUNTY INDUSTRIAL DEVELOPMENT AGENCY

By:  /s/Paul F. Slowey
                               Paul F. Slowey

STATE OF MINNESOTA	)
	)	SS.:
COUNTY OF HENNEPIN	)

On the 25th day of September in the year 2002, before me, the undersigned, personally appeared  Bradley D. Carlson, personally known to me or proved to me on the basis of satisfactory evidence to be the individual whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his capacity, and that by his signature on the instrument, the individual or the person upon behalf of which the individual acted, executed the instrument, and that such individual made such appearance before the undersigned in the City of Minneapolis.  

/s/Julie K. Uhrich                      
                        Notary Public

STATE OF NEW YORK	)
	)	SS.:
COUNTY OF CORTLAND	)

On the 23rd day of September in the year 2002, before me, the undersigned, personally appeared PAUL F. SLOWEY, personally known to me or proved to me on the basis of satisfactory evidence to be the individual whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his capacity, and that by his signature on the instrument, the individual or the person upon behalf of which the individual acted, executed the instrument.

/s/Edwin J. Kelley Jr.               
                        Notary Public

EXHIBIT "A"

PARCEL 1

ALL THAT TRACT OR PARCEL OF LAND, situate in the Town of Cortlandville, City of Cortland, County of Cortland and State of New York, being part of Lot No. 76 in said Town, bounded and described as follows:

BEGINNING at a point in the centerline of Kellogg Road at its intersection with the south line of lands of the Erie-Lackawanna Railway Company (Cincinnatus Branch), reputed owner; thence running North 73° 47' 50" West along said south line of the Railway Company, a distance of 78.72 feet to a point; thence continuing westerly along said south line along the arc of a circle to the right having a radius of 1781.78 feet and a central angle of 17° 58' 20", a distance of 558.90 feet to a point; thence continuing along said south line North 55° 49' 20" West, a distance of 1135.06 feet to a point in the northeast corner of lands of The Grand Union Company, reputed owner; thence running South 8° 07' 15" West along the easterly line of The Grand Union Company, reputed owner, a distance of 1153.23 feet to a point in the north line of lands of The Erie-Lackawanna Railway Company (formerly known as The Syracuse, Binghamton and New York Railroad Company), reputed owner; thence running along said north line of the Railway Company South 44° 11' 30" East, a distance of 1637.37 feet to a point; thence continuing along said north line of the Railway Company South 46° 02' 40" East, a distance of 210.40 feet to a point; thence running North 60° 24' 10" East, a distance of 1129.21 feet to a point in the centerline of Kellogg Road, said point also being the northwesterly corner of lands of Richard Reeves and Elizabeth Reeves, reputed owners; thence running North 30° 29' 40" West along said centerline of Kellogg Road, a distance of 1169.32 feet to the place of beginning.

PARCEL II

ALL THAT TRACT OR PARCEL OF LAND, situate in the City of Cortland, County of Cortland and State of New York, being part of Lot No. 76 in said City, bounded and described as follows:

BEGINNING at a point in the south line of lands of The Erie-Lackawanna Railway Company (formerly known as The Syracuse, Binghamton and New York Railroad Company), reputed owner, said point being an angle point in said south line, said point being located a distance of 356.01 feet southeasterly from a point opposite the southwest corner of the parcel above described; thence running North 44° 11' 30" West along said south line of the Railway Company, a distance of 629.13 feet to a point, said point being designated as Station 13123+58.1, 1° Cv. R on a Map entitled "Station Map - Lands of The Syracuse, Binghamton and New York R.R. Co." dated April 2, 1915; thence running northwesterly along the arc of a circle to the right having a radius of 5770.58 feet and a central angle of 5° 04' 55", a distance of 511.83 feet to a point, said point also being the intersection of said south line of the Railway Company and the division line between Great Lots No. 75 and 76; thence running South 8° 10' 40" West along the west line of Lot No. 76, a distance of 959.61 feet to a point; thence running South 81° 49' 20" East, a distance of 700.00 feet to a point; thence running North 45° 48' 30" East, a distance of 309.90 feet to the place of beginning.

 Said premises being more particularly described as follows:

PARCEL I

ALL THAT TRACT OR PARCEL OF LAND, situate in the Town of Cortlandville, City of Cortland, County of Cortland and State of New York, being part of Lot No. 76 in said Town, bounded and described as follows:

BEGINNING at a point in the centerline of Kellogg Road, said point also being the southerly line of lands formerly owned by the Lehigh Valley Railroad, now owned by the City of Cortland; thence running North 72° 50' 40" West along said southerly line of the former Railroad a distance of 78.82 feet to a point of curvature; thence running northwesterly along the arc of a circle to the right, having a radius of 1781.78 feet, a central angle of 17° 58' 20" and an arc length of 558.90 feet to a point, said arc having a chord length of 556.61 feet at North 63° 51' 30" West; thence running North 54° 52' 20" West along said southerly line of the former Railroad, a distance of 1135.07 feet to a point marked by an existing iron pipe; thence running South 09° 04' 25" West a distance of 1153.23 feet to a point marked by an existing iron rod found in the northerly line of lands of Conrail; thence running South 43° 14' 20" East along said northerly line of the Railroad a distance of 1637.37 feet to an angle point in said line; thence running South 45° 05' 30" East along said northerly line of the Railroad a distance of 210.40 feet to a point; thence running North 61° 21' 20" East along the westerly line of lands of Westendorf, reputed owner per deed filed at Document #1999-4963, a distance of 1129.21 feet to a point in the centerline of the aforementioned Kellogg Road; thence running North 29° 32' 40" West along said centerline of Kellogg Road a distance of 1169.32 feet to the place of Beginning and containing 64.255 acres (2,798,937 square feet) more or less of land.

PARCEL II

ALL THAT TRACT OR PARCEL OF LAND, situate in the City of Cortland, County of Cortland and State of New York, being part of Lot No. 76 in said City, bounded and described as follows:

BEGINNING at a point in the southerly line of lands of Cortland County Industrial Development Agency, reputed owner per deed filed at Liber 506, Page 235 (formerly Erie Lackawanna Railroad), said point also being in the division line between Military Lots 76 and 75; thence running southeasterly along said southerly line of the Railroad, along the arc of a circle to the left, having a radius of 5770.58 feet, a central angle of 05° 04' 55" and an arc length of 511.82 feet to a point of tangency in said line, said arc having a chord length of 511.65 feet at South 40° 41' 54" East; thence running South 43° 14' 20" East along said southerly line of the Railroad, a distance of 629.13 feet to a point; thence running South 46° 45' 40" West a distance of 309.90 feet to a point; thence running North 80° 52' 10" West a distance of 700.00 feet to a point in the westerly line of Military Lot 76; thence running North 09° 07' 50" East along said division line between Military Lots 76 and 75, a distance of 959.61 feet to the place of Beginning and containing 11.558 acres (503,479 square feet) more or less of land.