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): April 7, 2005

REGIS CORPORATION

(Exact name of registrant as specified in its charter)

Minnesota	0-11230	41-0749934
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No)

7201 Metro Boulevard
Minneapolis, MN 55439
(Address of principal executive offices and zip code)

(952) 947-7000
(Registrant’s telephone number, including area code)

(Not applicable)
(Former name or former address, if changed from last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

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

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

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

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

Regis Corporation
Current Report on Form 8-K

TABLE OF CONTENTS

3rd Amended/Restated Credit Agreement

Master Note Purchase Agreement

1st Amendment to Note Purchase Agreement

ITEM 1.01. Entry into a Material Definitive Agreement.

Revolving Credit Facility

On April 7, 2005 Regis Corporation entered into an amendment and restatement of its existing revolving credit facility with a syndicate of eight banks, including Bank of America, N.A., which served as Administrative Agent, and LaSalle Bank National Association, which served as co-administrative agent and as swing line lender. Among other changes, such amendment and restatement increased the borrowing capacity under the facility from $250 million to $350 million, extended the facility’s expiration date to April of 2010, reduced the spread charged for certain borrowings under the facility, and modified certain financial covenants.

As so amended, the credit agreement includes financial covenants and other customary terms and conditions for credit facilities of this type. The maturity date for the facility may be accelerated upon the occurrence of various Events of Default, including breaches of the credit agreement, certain cross-default situations, certain bankruptcy-related situations, and other customary events of default for a facility of this type. The interest rates under the facility vary and are based on a bank’s reference rate, the federal funds rate and/or LIBOR, as applicable, and a leverage ratio for the Company determined by a formula tied to the Company’s debt and its adjusted income. The Company’s obligations under the credit agreement are currently guaranteed by the following wholly-owned subsidiaries (though a subsidiary may be released in certain circumstances and other subsidiaries may be added in certain circumstances): Supercuts, Inc., Supercuts Corporate Shops, Inc., Regis Corp., Regis, Inc., Trade Secret, Inc., The Barbers, Hairstyling for Men & Women, Inc., and Hair Club for Men, LLC. The foregoing description of the credit agreement and facility does not purport to be complete and is qualified in its entirety by reference to the complete text of the Third Amended and Restated Credit Agreement, which is filed as Exhibit 99.1 hereto and incorporated herein by reference.

Private Placement

Also on April 7, 2005, the Company issued $200 million of senior unsecured debt to approximately twenty purchasers via a private placement transaction pursuant to a Master Note Purchase Agreement. The placement was split into four tranches, with $100 million maturing March 31, 2013 and $100 million maturing March 31, 2015. Of the debt maturing in 2013, $30 million was issued as fixed rate debt with a rate of 4.97%. The remaining $70 million was issued as floating rate debt and is priced at 0.52% over LIBOR. As for the $100 million maturing in 2015, $70 million was issued at a fixed rate of 5.20%, with the remaining $30 million issued as floating rate debt, priced at 0.55% over LIBOR. All four tranches are non-amortizing and no principle payments are due until maturity. Interest payments are due semi-annually.

The Master Note Purchase Agreement includes financial covenants and other customary terms and conditions for debt of this type. The maturity date for the debt may be accelerated upon the occurrence of various Events of Default, including breaches of the agreement, certain cross-default situations, certain bankruptcy-related situations, and other customary events of default for debt of this type. The Company’s obligations with respect to this debt are currently guaranteed by the following wholly-owned subsidiaries (though a subsidiary may be released in certain circumstances and other subsidiaries may be added in certain circumstances): Supercuts, Inc., Supercuts Corporate Shops, Inc., Regis Corp., Regis, Inc., Trade Secret, Inc., The Barbers, Hairstyling for Men & Women, Inc., and Hair Club for Men, LLC. The foregoing description of the Master Note Purchase Agreement and debt does not purport to be complete and is qualified in its entirety by reference to the complete text of the Master Note Purchase Agreement, which is filed as Exhibit 99.2 hereto and incorporated herein by reference.

Amendment to existing Note Purchase Agreement

In anticipation of its new Master Note Purchase Agreement, the Company entered into a First Amendment to Note Purchase Agreement with respect to an existing Note Purchase Agreement dated as of March 1, 2002 (filed as Exhibit 10(aa) of the Company’s Report on Form 10-K dated September 24, 2002, for the year ended June 30, 2002). The Company closed on the amendment on April 7, 2005. The amendment modified certain financial covenants so that they would be more consistent with the financial covenants in the new Master Note Purchase Agreement. The foregoing description of the amendment does not purport to be complete and is qualified in its entirety by reference to the complete text of the First Amendment to Note Purchase Agreement, which is filed as Exhibit 99.3 hereto and incorporated herein by reference.

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

See description of the Private Placement debt in Item 1.01 above.

ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS.

(c) Exhibits.

EXHIBIT
NUMBER
99.1	Third Amended and Restated Credit Agreement dated as of April 7, 2005 among Regis Corporation, Bank of America, N.A., as Administrative Agent, LaSalle Bank National Association, as Co-Administrative Agent and Co-Arranger and as Swing-Line Lender, J.P. Morgan Chase Bank, N.A., as Syndication Agent, Wachovia Bank, National Association, as Documentation Agent and the Other Financial Institutions Party Hereto Banc of America Securities LLC as Co-Arranger and Sole Book Manager.
99.2	Master Note Purchase Agreement dated as of March 15, 2005.
99.3	First Amendment to Note Purchase Agreement dated as of March 1, 2005.

2

SIGNATURE

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

	REGIS	CORPORATION
Dated: April 12, 2005	By:	/s/ Eric Bakken
		Name: Eric Bakken, Title: Secretary

3

EXHIBIT INDEX

EXHIBIT
NUMBER
99.1	Third Amended and Restated Credit Agreement dated as of April 7, 2005 among Regis Corporation, Bank of America, N.A., as Administrative Agent, LaSalle Bank National Association, as Co-Administrative Agent and Co-Arranger and as Swing-Line Lender, J.P. Morgan Chase Bank, N.A., as Syndication Agent, Wachovia Bank, National Association, as Documentation Agent and the Other Financial Institutions Party Hereto Banc of America Securities LLC as Co-Arranger and Sole Book Manager.
99.2	Master Note Purchase Agreement dated as of March 15, 2005.
99.3	First Amendment to Note Purchase Agreement dated as of March 1, 2005.

4

EX-99.1

EXHIBIT 99.1

Execution Copy

THIRD AMENDED AND RESTATED CREDIT AGREEMENT

Dated as of April 7, 2005

among

REGIS CORPORATION,

BANK OF AMERICA, N.A.,

as Administrative Agent,

LASALLE BANK NATIONAL ASSOCIATION,

as Co-Administrative Agent and Co-Arranger

and

as Swing Line Lender,

JPMORGAN CHASE BANK, N.A.

as Syndication Agent,

WACHOVIA BANK, NATIONAL ASSOCIATION,

as Documentation Agent

and

THE OTHER FINANCIAL INSTITUTIONS PARTY HERETO

BANC OF AMERICA SECURITIES LLC

as

Co-Arranger and Sole Book Manager

TABLE OF CONTENTS

	Page
ARTICLE I            DEFINITIONS	1
1.01 Certain Defined Terms	1
1.02 Other Interpretive Provisions	22
1.03 Accounting Principles	23
1.04 Currency Equivalents Generally	24
ARTICLE II            THE CREDITS	24
2.01 Amounts and Terms of Commitments	24
2.02 Loan Accounts	24
2.03 Procedure for Borrowing	25
2.04 Conversion and Continuation Elections	26
2.05 The Swing Line Loans	27
2.06 Utilization of Commitments in an Alternative Currency	29
2.07 Voluntary Termination or Reduction of Revolving Loan Commitments	31
2.08 Prepayments	32
2.09 Repayment	33
2.10 Interest	33
2.11 Fees	33
2.12 Computation of Fees and Interest	34
2.13 Payments by the Company	34
2.14 Payments by the Lenders to the Co-Administrative Agent	35
2.15 Sharing of Payments, Etc.	36
2.16 Subsidiary Guaranty	36
2.17 Increase in Commitments; Additional Lenders	36
ARTICLE III            THE LETTERS OF CREDIT	37
3.01 The Letter of Credit Subfacility	38
3.02 Issuance, Amendment and Renewal of Letters of Credit	39
3.03 Risk Participations, Drawings and Reimbursements	40
3.04 Repayment of Participations	42
3.05 Role of the Issuer	42
3.06 Obligations Absolute	43
3.07 Cash Collateral Pledge	44
3.08 Letter of Credit Fees	44
3.09 Uniform Customs and Practice	45
ARTICLE IV            TAXES, YIELD PROTECTION AND ILLEGALITY	45
4.01 Taxes	45
4.02 Illegality	46
4.03 Increased Costs and Reduction of Return	46
4.04 Funding Losses	47

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Table of Contents
(continued)
	Page
4.05 Inability to Determine Rates	48
4.06 Reserves on Offshore Rate Loans	48
4.07 Certificates of Lenders	48
4.08 Substitution of Banks	48
4.09 Survival	49
ARTICLE V            CONDITIONS PRECEDENT	49
5.01 Conditions to Effectiveness of Restatement	49
5.02 Conditions to All Credit Extensions	50
ARTICLE VI            REPRESENTATIONS AND WARRANTIES	51
6.01 Corporate Existence and Power	51
6.02 Corporate Authorization; No Contravention	51
6.03 Governmental Authorization	52
6.04 Binding Effect	52
6.05 Litigation	52
6.06 No Default	52
6.07 ERISA Compliance	52
6.08 Use of Proceeds; Margin Regulations	53
6.09 Title to Properties	53
6.10 Taxes	53
6.11 Financial Condition	54
6.12 Environmental Matters	54
6.13 Labor Relations	55
6.14 Regulated Entities	55
6.15 No Burdensome Restrictions	55
6.16 Copyrights, Patents, Trademarks and Licenses, etc.	55
6.17 Subsidiaries	55
6.18 Insurance	55
6.19 Swap Obligations	55
6.20 Solvency	56
6.21 Full Disclosure	56
ARTICLE VII            AFFIRMATIVE COVENANTS	56
7.01 Financial Statements	56
7.02 Certificates; Other Information	57
7.03 Notices	58
7.04 Preservation of Corporate Existence, Etc.	59
7.05 Maintenance of Property	59
7.06 Insurance	59
7.07 Payment of Obligations	60
7.08 Compliance with Laws	60

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Table of Contents
(continued)
	Page
7.09 Compliance with ERISA		60
7.10 Inspection of Property and Books and Records		60
7.11 Environmental Laws		61
7.12 Use of Proceeds		61
7.13 Further Assurances		61
7.14 Additional Guaranties		61
ARTICLE VIII             NEGATIVE COVENANTS		62
8.01 Limitation on Liens		62
8.02 Disposition of Assets		63
8.03 Consolidations and Mergers		64
8.04 Loans and Investments		64
8.05 Limitation on Indebtedness		65
8.06 Transactions with Affiliates		66
8.07 Use of Proceeds		66
8.08 Contingent Obligations		66
8.09 [INTENTIONALLY OMITTED]		66
8.10 ERISA		66
8.11 Change in Business		66
8.12 Accounting Changes		66
8.13 Amendments to Charter		67
8.14 Leverage Ratio		67
8.15 Fixed Charge Coverage Ratio		67
8.16 Minimum Net Worth		67
8.17 Restrictive Agreements		67
ARTICLE IX            EVENTS OF DEFAULT		67
9.01 Event of Default		67
9.02 Remedies		70
9.03 Rights Not Exclusive		70
ARTICLE X            THE AGENT AND THE CO-ADMINISTRATIVE AGENT		71
10.01 Appointment and Authorization; “Agent”; “Co-Administrative Agent”		71
10.02 Delegation of Duties		71
10.03 Liability of Agent and Co-Administrative Agent		71
10.04 Reliance by Agent and Co-Administrative Agent		72
10.05 Notice of Default		72
10.06 Credit Decision		73
10.07 Indemnification of Agent and Co-Administrative Agent		73
10.08 Agent in Individual Capacity		73
10.09 Successor Agent		74
10.10 Withholding Tax		74

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Table of Contents
(continued)
	Page
10.11 Co-Agents	76
ARTICLE XI            MISCELLANEOUS	76
11.01 Amendments and Waivers	76
11.02 Notices	77
11.03 No Waiver; Cumulative Remedies	78
11.04 Costs and Expenses	78
11.05 Company Indemnification	78
11.06 Marshalling; Payments Set Aside	79
11.07 Successors and Assigns	79
11.08 Assignments, Participations, etc.	79
11.09 Confidentiality	81
11.10 Set-off	81
11.11 Automatic Debits of Fees	82
11.12 Notification of Addresses, Lending Offices, Etc.	82
11.13 Counterparts	82
11.14 Severability	82
11.15 No Third Parties Benefited	82
11.16 GOVERNING LAW AND JURISDICTION	82
11.17 WAIVER OF JURY TRIAL	83
11.18 Judgment	83
11.19 Entire Agreement	84
11.20 Euro Currency	84
11.21 Restatement Date	84
11.22 USA PATRIOT Act Notice	85

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Table of Contents
(continued)
	Page
SCHEDULES
Schedule 1.01 Existing Letters of Credit
Schedule 2.01 Commitments and Pro Rata Shares
Schedule 6.11 Financial Condition
Schedule 6.12 Environmental Matters
Schedule 6.17 Capitalization; Subsidiaries and Minority Interests
Schedule 8.01 Permitted Liens
Schedule 8.04 Investments
Schedule 8.05 Permitted Indebtedness
Schedule 8.08 Contingent Obligations
Schedule 11.02 Lending Offices; Addresses for Notices
EXHIBITS
Exhibit A Form of Notice of Borrowing
Exhibit B Form of Notice of Conversion/Continuation
Exhibit C Form of Compliance Certificate
Exhibit D Form of Assignment and Acceptance
Exhibit E Form of Subsidiary Guaranty

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THIRD AMENDED AND RESTATED CREDIT AGREEMENT

     This THIRD AMENDED AND RESTATED CREDIT AGREEMENT is entered into as of April 7, 2005, among Regis Corporation, a Minnesota corporation (the “Company”), the several financial institutions from time to time party to this Agreement (collectively, the “Lenders”; individually, a “Lender”), Bank of America, N.A., as administrative agent for the Lenders (herein in such capacity, together with any successors thereto in such capacity, called the “Administrative Agent” or “Agent”), and LaSalle Bank National Association, as co-administrative agent for the Lenders (herein in such capacity, together with any successors thereto in such capacity, called the “Co-Administrative Agent”) and as Swing Line Lender.

     WHEREAS, the Company, the lenders party thereto, the Agent and the Co-Administrative Agent entered into that certain Second Amended and Restated Credit Agreement dated as of November 12, 2002 (the “Prior Credit Agreement”), pursuant to which such lenders provided certain credit facilities to the Company in order to provide funds for acquisitions, working capital and general corporate purposes; and

     WHEREAS, the Company, the Lenders, the Agent, and the Co-Administrative Agent wish to refinance the existing revolving credit facility and offshore currency subfacility and, concurrently, to amend and restate the Prior Credit Agreement in its entirety;

     NOW, THEREFORE, in consideration of the mutual agreements, provisions and covenants contained herein, the parties agree, subject to the fulfillment of the conditions precedent set forth in Section 5.01, that the Prior Credit Agreement is hereby amended and restated in its entirety as follows:

ARTICLE I

DEFINITIONS

     1.01 Certain Defined Terms. The following terms have the following meanings:

     “ABN AMRO” means ABN AMRO Bank N.V..

     “Administrative Agent” see preamble.

     “Acquisition” means 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 Company or the Subsidiary is the surviving entity.

     “Additional Lender” has the meaning specified in Section 2.17.

     “Affiliate” means, as to any Person, any other Person which, directly or indirectly, is in control of, is controlled by, or is under common control with, such Person. A Person shall be deemed to control another Person if the controlling Person possesses, directly or indirectly, the power to direct or cause the direction of the management and policies of the other Person, whether through the ownership of voting securities, membership interests, by contract, or otherwise.

     “Agent” means Bank of America, N.A., in its capacity as administrative agent for the Lenders hereunder, and any successor agent arising under Section 10.09.

     “Agent Fee Letter” has the meaning specified in subsection 2.11(a).

     “Agent-Related Persons” means Bank of America, LaSalle, any successor administrative agent or co-administrative agent arising under Section 10.09 and any successor letter of credit issuing bank hereunder, together with their respective Affiliates (including, in the case of Bank of America and LaSalle, the Arranger), and the officers, directors, employees, agents and attorneys-in-fact of such Persons and Affiliates.

     “Aggregate Commitment” means the aggregate Commitments of the Lenders.

     “Agreed Alternative Currency” has the meaning specified in subsection 2.06(e).

     “Agreement” means this Third Amended and Restated Credit Agreement, as amended, modified, supplemented, or replaced from time to time.

     “Alternative Currency Loans” means Offshore Rate Loans denominated in a currency other than Dollars.

     “Applicable Currency” means, as to any particular payment or Loan, Dollars or the Offshore Currency in which it is denominated or payable.

     “Applicable Margin” means, subject to the last sentence of this definition, for any period, the applicable of the following percentages in effect with respect to such period as the Leverage Ratio of the Company shall fall within the indicated ranges:

			Applicable Margin
			for Offshore Rate		Applicable Margin
			Loans		for Base Rate Loans
Leverage Ratio			(in basis points)		(in basis points)
Less	Greater Than or
Than	Equal to
1.25		—		50.0		0.0
1.75		1.25		62.5		0.0
2.25		1.75		87.5		0.0
—		2.25		112.5		0.0

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The Leverage Ratio shall be calculated by the Company as of the end of each fiscal quarter, commencing with the fiscal quarter ending March 31, 2005, and shall be reported to the Co-Administrative Agent pursuant to a Compliance Certificate executed by a Responsible Officer of the Company and delivered pursuant to subsection 7.02(b) hereof; provided, that the Leverage Ratio shall also be calculated by the Company upon the date of the consummation of each Permitted Acquisition (or series of related Permitted Acquisitions) equal to or in excess of $100,000,000 and shall be reported to the Co-Administrative Agent pursuant to a certificate executed by a Responsible Officer of the Company delivered on such date. The Applicable Margin shall be adjusted, if necessary, on the third Business Day after the delivery of such certificate, with such adjustment to apply to all Interest Periods then outstanding and beginning thereafter until the next adjustment date; provided, that if such certificate, together (if applicable) with the financial statements to which such certificate relates, is not delivered to the Co-Administrative Agent by the fifth Business Day after the date on which the related financial statements are due to be delivered to the Co-Administrative Agent pursuant to subsection 7.01(a) or (b), then, from such fifth Business Day until the third Business Day after delivery of such certificate, the Applicable Margin shall be equal to 112.5 basis points for Offshore Rate Loans. From the Restatement Date until adjusted as described above, the Applicable Margin shall be equal to 87.5 basis points for Offshore Rate Loans. Notwithstanding the foregoing, no reduction in the Applicable Margin shall be effected if a Default or Event of Default shall have occurred and be continuing on the date such change would otherwise occur, it being understood that on the third Business Day immediately succeeding the day on which such Default or Event of Default is either waived or cured (assuming no other Default or Event of Default shall then be pending) the Applicable Margin shall be reduced (on a prospective basis) in accordance with the then most recently delivered Compliance Certificate.

     “Applicable Non-Use Fee Percentage” means, subject to the last sentence of this definition, for any period, the applicable of the following percentages in effect with respect to such period as the Leverage Ratio of the Company shall fall within the indicated ranges:

Leverage Ratio			Applicable Non-Use
Less	Greater Than		Fee Percentage
Than	or Equal to		(in basis points)
1.25		—		12.5
1.75		1.25		15.0
2.25		1.75		17.5
—		2.25		22.5

The Leverage Ratio shall be calculated by the Company as of the end of each fiscal quarter, commencing with the fiscal quarter ending March 31, 2005, and shall be reported to the Co-Administrative Agent pursuant to a Compliance Certificate executed by a Responsible Officer of the Company and delivered pursuant to subsection 7.02(b) hereof; provided, that the Leverage Ratio shall also be calculated by the Company upon the date

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of the consummation of each Permitted Acquisition (or series of related Permitted Acquisitions) in excess of $100,000,000 and shall be reported to the Co-Administrative Agent pursuant to a certificate executed by a Responsible Officer of the Company delivered on such date. The Applicable Non-Use Fee Percentage shall be adjusted, if necessary, on the third Business Day after the delivery of such certificate; provided, that if such certificate, together (if applicable) with the financial statements to which such certificate relates, is not delivered to the Co-Administrative Agent by the fifth Business Day after the date on which the related financial statements are due to be delivered to the Co-Administrative Agent pursuant to subsection 7.01(a) or (b), then, from such fifth Business Day until the third Business Day after delivery of such certificate, the Applicable Non-Use Fee Percentage shall be equal to 22.5 basis points. From the Restatement Date until adjusted with respect to the Fiscal Quarter ending March 31, 2005, the Applicable Non-Use Fee Percentage shall be equal to 17.5 basis points. Notwithstanding the foregoing, no reduction in the Applicable Non-Use Fee Percentage shall be effected if a Default or Event of Default shall have occurred and be continuing on the date when such change would otherwise occur, it being understood that on the third Business Day immediately succeeding the day on which such Default or Event of Default is either waived or cured (assuming no other Default or Event of Default shall then be pending), the Applicable Non-Use Fee Percentage shall be reduced (on a prospective basis) in accordance with the then most recently delivered Compliance Certificate.

     “Arranger” means either Banc of America Securities LLC and LaSalle in its capacity as arranger hereunder.

     “Asset Disposition” has the meaning specified in Section 8.02.

     “Assignee” has the meaning specified in subsection 11.08(a).

     “Attorney Costs” means and includes all reasonable fees and disbursements of any law firm or other external counsel, the allocated cost of internal legal services and all disbursements of internal counsel.

     “Bank of America” means Bank of America, N.A., a national banking association.

     “Banking Day” means any day other than a Saturday, Sunday or other day on which commercial banks in Chicago, Illinois or San Francisco, California are authorized or required by law to close, and (a) with respect to disbursements and payments in Dollars, a day on which dealings are carried on in the applicable offshore Dollar interbank market and (b) with respect to any disbursements and payments in and calculations pertaining to any Offshore Rate Loan, a day on which dealings in the Offshore Currency are carried on in the applicable offshore foreign exchange interbank market in which disbursement of or payment in such Offshore Currency will be made or received hereunder.

     “Bankruptcy Code” means the Federal Bankruptcy Reform Act of 1978 (11 U.S.C. §101, et seq.).

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     “Base Rate” means, with respect to an obligation denominated in Dollars for any day, the higher of (a) 0.50% per annum above the latest Federal Funds Rate and (b) the rate of interest in effect for such day as publicly announced from time to time by LaSalle in Chicago, Illinois, as its “reference rate”; provided, that, in the event, that LaSalle cannot or does not publicly announce its “reference rate” then the “reference rate” in effect for such day shall be the rate of interest as publicly announced by Bank of America, in Chicago, Illinois as its “reference rate” on such day. The “reference rate” is a rate set by LaSalle and Bank of America, as the case may be, based upon various factors including LaSalle’s and Bank of America’s costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans, which may be priced at, above, or below such announced rate. Any change in the reference rate announced by LaSalle or Bank of America, as the case may be, shall take effect at the opening of business on the day specified in the public announcement of such change.

     “Base Rate Loan” means a Loan or an L/C Advance that bears interest based on the Base Rate.

     “basis point” means one one-hundredth of one percent.

     “Borrowing” means a borrowing hereunder consisting of Revolving Loans of the same Type made to the Company on the same day by the Lenders under Article II, and, in the case of Offshore Rate Loans, having the same Interest Period. The making of a Swing Line Loan shall not constitute a Borrowing.

     “Borrowing Date” means any date on which a Borrowing occurs under Section 2.03.

     “Business Day” means any day other than a Saturday, Sunday or other day on which commercial banks in Chicago, Illinois or San Francisco, California are authorized or required by law to close and, if the applicable Business Day relates to any Offshore Rate Loan, means a Banking Day.

     “Capital Adequacy Regulation” means any guideline, request or directive of any central bank or other Governmental Authority, or any other law, rule or regulation, whether or not having the force of law, in each case, regarding capital adequacy of any bank or of any corporation controlling a bank.

     “Capital Lease” has the meaning specified in the definition of “Capital Lease Obligations”.

     “Capital Lease Obligations” means all monetary obligations of the Company or any of its Subsidiaries under any leasing or similar arrangement which, in accordance with GAAP, is classified as a capital lease (a “Capital Lease”).

     “Capital Stock” means (a) in the case of a corporation, corporate stock, (b) in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of corporate stock, (c) in the case of a

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partnership or limited liability company, partnership or membership interests (whether general or limited) and (d) any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets of, the issuing Person.

     “Cash Collateralize” means to pledge and deposit with or deliver to the Co-Administrative Agent, for the benefit of the Agent, the Co-Administrative Agent, the Issuer and the Lenders, as additional collateral for the L/C Obligations, cash or deposit account balances pursuant to documentation in form and substance satisfactory to the Co-Administrative Agent and the Issuer (which documents are hereby consented to by the Lenders). Derivatives of such term shall have corresponding meanings. The Company hereby grants the Co-Administrative Agent, for the benefit of the Agent, the Co-Administrative Agent, the Issuer and the Lenders, a security interest in all such cash and deposit account balances. Cash collateral shall be maintained in blocked deposit accounts at LaSalle. The Co-Administrative Agent shall invest any and all available funds deposited in such deposit accounts, within 10 Business Days after the date the relevant funds become available, in securities issued or fully guaranteed or insured by the United States Government or any agency thereof backed by the full faith and credit of the United States having maturities of three months from the date of acquisition thereof (collectively, “Governmental Obligations”). The Company hereby acknowledges and agrees that the Co-Administrative Agent shall not have any liability with respect to, and the Company hereby indemnifies the Co-Administrative Agent against, any loss resulting from the acquisition of the Government Obligations and the Co-Administrative Agent shall not have any obligation to monitor the trading activity of any such Governmental Obligations on and after the acquisition thereof for the purpose of obtaining the highest possible return with respect thereto, the Co-Administrative Agent’s responsibility being limited to acquiring such Governmental Obligations.

     “Cash Equivalents” means:

     (a) securities issued or fully guaranteed or insured by the United States Government or any agency thereof and backed by the full faith and credit of the United States or such other countries where the Company or its Subsidiaries have operations purchased in the ordinary course of business consistent with past practices and having maturities of not more than twelve months from the date of acquisition;

     (b) certificates of deposit, time deposits, Eurodollar time deposits, repurchase agreements, reverse repurchase agreements, or bankers’ acceptances, having in each case a term of not more than twelve months, issued by any Lender, or by any U.S. commercial bank or non-U.S. commercial bank in the ordinary course of business consistent with past practices having combined capital and surplus of not less than $100,000,000 whose short term securities are rated at least A-1 by S&P and P-1 by Moody’s; and

     (c) commercial paper of an issuer rated at least A-1 by S&P or P-1 by Moody’s and in either case having a tenor of not more than three months.

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     “CERCLA” has the meaning specified in the definition of “Environmental Laws.”

     “Change of Control” means (a) any Person or any two or more Persons acting in concert acquiring beneficial ownership (within the meaning of Rule 13d-3 of the Securities and Exchange Commission under the Exchange Act), directly or indirectly, of capital stock of the Company (or other securities convertible into such capital stock) representing 20% or more of the combined voting power of all capital stock of the Company entitled to vote in the election of directors, other than capital stock having such power only by reason of the happening of a contingency; or (b) during any period of twelve consecutive calendar months, individuals who at the beginning of such period constituted the Company’s board of directors (together with any new directors whose election by the Company’s board of directors or whose nomination for election by the Company’s stockholders was approved by a vote of at least a majority of the directors then still in office who either were directors at the beginning of such period or whose election or nomination for election was previously so approved) cease for any reasons other than death or disability to constitute a majority of the directors then in office.

     “Co-Administrative Agent” means LaSalle in its capacity as co-administrative agent for the Lenders hereunder, and any successor co-administrative agent arising under Section 10.09.

     “Co-Administrative Agent Fee Letter” has the meaning specified in subsection 2.11(b).

     “Co-Administrative Agent’s Payment Office” means (a) in respect of payments in Dollars, the address for payments set forth on Schedule 11.02 or such other address as the Co-Administrative Agent may from time to time specify, and (b) in the case of payments in any Offshore Currency, such address as the Co-Administrative Agent may from time to time specify in accordance with Section 11.02.

     “Code” means the Internal Revenue Code of 1986, as amended, and regulations promulgated thereunder.

     “Commitment” has the meaning specified in Section 2.01, as such amount may be increased or decreased in accordance with the terms of this Agreement.

     “Commitment Increase” has the meaning specified in Section 2.17.

     “Company” has the meaning specified in the introductory clause hereto.

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

     “Computation Date” has the meaning specified in subsection 2.06(a).

     “Contingent Obligation” means, as to any Person, any direct or indirect liability of that Person, whether or not contingent, with or without recourse, (a) with respect to any Indebtedness, lease, dividend, letter of credit or other obligation (the “primary

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obligations”) of another Person (the “primary obligor”), including any obligation of that Person (i) to purchase, repurchase or otherwise acquire such primary obligations or any security therefor, (ii) to advance or provide funds for the payment or discharge of any such primary obligation, or to maintain working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency or any balance sheet item, level of income or financial condition 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 holder of any such primary obligation against loss in respect thereof (each, a “Guaranty Obligation”); (b) with respect to any Surety Instrument issued for the account of that Person or as to which that Person is otherwise liable for reimbursement of drawings or payments; (c) to purchase any materials, supplies or other property from, or to obtain the services of, another Person if the relevant contract or other related document or obligation requires that payment for such materials, supplies or other property, or for such services, shall be made regardless of whether delivery of such materials, supplies or other property is ever made or tendered, or such services are ever performed or tendered; or (d) in respect of any Swap Contract. The amount of any Contingent Obligation, (x) in the case of Guaranty Obligations, shall be deemed equal to the stated or determinable amount of the primary obligation in respect of which such Guaranty Obligation is made or, if not stated or if indeterminable, the maximum reasonably anticipated liability in respect thereof, (y) in the case of Contingent Obligations in respect of Swap Contracts, shall be deemed equal to the aggregate Swap Termination Value of such Swap Contracts, and (z) in the case of other Contingent Obligations shall be deemed equal to the maximum reasonably anticipated liability in respect thereof.

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

     “Conversion/Continuation Date” means any date on which, under Section 2.04, the Company (a) converts Loans of one Type to another Type, or (b) continues as Loans of the same Type, but with a new Interest Period, Loans having Interest Periods expiring on such date.

     “Credit Extension” means and includes (a) the making of any Loans hereunder, and (b) the Issuance of any Letters of Credit hereunder.

     “Current Assets” means all assets of the Company, on a consolidated basis, which should, in accordance with GAAP, be classified as current assets.

     “Current Liabilities” means all liabilities of the Company, on a consolidated basis, which should, in accordance with GAAP, be classified as current liabilities, other than current maturities in respect of the Loans.

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     “Default” means any event or circumstance which, with the giving of notice, the lapse of time, or both, would (if not cured or otherwise remedied during such time) constitute an Event of Default.

     “Dollar Equivalent” means, at any time, (a) as to any amount denominated in Dollars, the amount thereof at such time, and (b) as to any amount denominated in an Offshore Currency, the equivalent amount in Dollars as determined by the Co-Administrative Agent at such time on the basis of the Spot Rate for the purchase of Dollars with such Alternative Offshore Currency on the most recent Computation Date provided for in subsection 2.06(a).

     “Dollars”, “dollars” and “$” each mean lawful money of the United States.

     “Domestic Subsidiary” means any Subsidiary of the Company that is organized under the laws of the United States or any state thereof.

     “EBITDA” means, for any period, for the Company and its Subsidiaries on a consolidated basis, determined in accordance with GAAP, the sum of (a) the net income (or net loss) for such period, plus (b) all amounts treated as expenses for depreciation (including, without duplication, non-cash gains and losses upon the closing and abandonment of any non-franchised store locations) and interest and the amortization of intangibles of any kind to the extent included in the determination of such net income (or loss), plus (c) all taxes paid or accrued and unpaid on or measured by income to the extent included in the determination of such net income (or net loss), plus (d) without duplication, the amount of any other charge in respect of non-recurring expenses arising in connection with Acquisitions, to the extent approved by the Agent and the Required Lenders; provided, that if the Company or any Subsidiary makes any Acquisition in any such period, then all of the Acquired Person’s EBITDA for the four fiscal quarters then ended shall be added to EBITDA, and if the Company or any Subsidiary sells all or substantially all of the stock or assets of any Subsidiary in any such period, then all the EBITDA of such Subsidiary shall be deducted from EBITDA.

     “EBITDAR” means, for any period, for the Company and its Subsidiaries on a consolidated basis, determined in accordance with GAAP, the sum of (a) EBITDA for such period, minus (b) any Acquired Person’s EBITDA added to the determination of EBITDA for the four fiscal quarters then ended pursuant to the proviso set forth in the definition of EBITDA, plus (c) the EBITDA of any Subsidiary deducted from the determination of EBITDA for the four fiscal quarters then ended pursuant to the proviso set forth in the definition of EBITDA, plus (d) all Rental Expense for such period.

     “Effective Amount” means (a) with respect to any Loans on any date, the aggregate outstanding principal Dollar Equivalent amount thereof after giving effect to any Borrowings and prepayments or repayments of Loans occurring on such date and any Swing Line Loans made on such date; and (b) with respect to any outstanding L/C Obligations on any date, the Dollar Equivalent amount of such L/C Obligations on such date after giving effect to any Issuances of Letters of Credit occurring on such date and any other changes in the aggregate amount of the L/C Obligations as of such date,

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including as a result of any reimbursements of outstanding unpaid drawings under any Letters of Credit or any reductions in the maximum amount available for drawing under Letters of Credit taking effect on such date.

     “Eligible Assignee” means (a) a commercial bank organized under the laws of the United States, or any state thereof, and having a combined capital and surplus of at least $100,000,000; (b) a commercial bank organized under the laws of any other country which is a member of the Organization for Economic Cooperation and Development (the “OECD”), or a political subdivision of any such country, and having a combined capital and surplus of at least $100,000,000, provided that such bank is acting through a branch or agency located in the United States; (c) a Person that is primarily engaged in the business of commercial banking and that is (i) a Subsidiary of a Lender, (ii) a Subsidiary of a Person of which a Lender is a Subsidiary, or (iii) a Person of which a Lender is a Subsidiary and (d) any other Person that has been approved in writing as an Eligible Assignee by the Company (prior to the occurrence and continuance of an Event of Default), the Agent and the Co-Administrative Agent.

     “Environmental Claims” means all claims, however asserted, by any Governmental Authority or other Person alleging potential liability or responsibility for violation of any Environmental Law, or for release or injury to the environment or threat to public health, personal injury (including sickness, disease or death), property damage, natural resources damage, or otherwise alleging liability or responsibility for damages (punitive or otherwise), investigation, cleanup, removal, remedial or response costs, restitution, civil or criminal penalties, injunctive relief, or other type of relief, resulting from or based upon the presence, placements, discharge, emission or release (including intentional and unintentional, negligent and non-negligent, sudden or non-sudden, accidental or non-accidental, placements, spills, leaks, discharges, emissions or releases) of any Hazardous Material at, in, or from any property, whether or not owned by the Company or any Subsidiary or taken as collateral, or in connection with any operations of the Company.

     “Environmental Laws” means all federal, state or local laws, statutes, common law duties, rules, regulations, ordinances and codes, together with all administrative orders, directed duties, requests, licenses, authorizations and permits of, and agreements with, any Governmental Authorities, in each case relating to environmental, health, safety and land use matters, including without limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980 (“CERCLA”), the Clean Air Act, the Federal Water Pollution Control Act of 1972, the Solid Waste Disposal Act, the Federal Resource Conservation and Recovery Act, the Toxic Substances Control Act, and the Emergency Planning and Community Right-to-Know Act.

     “Environmental Permits” has the meaning specified in subsection 6.12(b).

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

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

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

     “Euro” means the single currency of participating member states of the European Monetary Union.

     “Eurodollar Reserve Percentage” has the meaning specified in the definition of “Offshore Rate”.

     “Event of Default” means any of the events or circumstances specified in Section 9.01.

     “Exchange Act” means the Securities Exchange Act of 1934 and the regulations promulgated thereunder.

     “Existing Letters of Credit” means each of the outstanding letters of credit previously issued under the Prior Credit Agreement and individually described on Schedule 1.01.

     “FDIC” means the Federal Deposit Insurance Corporation, and any Governmental Authority succeeding to any of its principal functions.

     “Federal Funds Rate” means, for any day, the rate set forth in the weekly statistical release designated as H.15(519), or any successor publication, published by the Federal Reserve Bank of New York (including any such successor, “H.15(519)”) on the preceding Business Day opposite the caption “Federal Funds (Effective)”; or, if for any relevant day such rate is not so published on any such preceding Business Day, the rate for such day will be the arithmetic mean as determined by the Co-Administrative Agent of the rates for the last transaction in overnight Federal funds arranged prior to 9:00 a.m.

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(Chicago time) on that day by each of three leading brokers of Federal funds transactions in Chicago, Illinois selected by the Co-Administrative Agent.

     “Fixed Charges” means, with respect to the Company and its Subsidiaries on a consolidated basis, as of any date of determination, (a) interest expense paid or accrued on outstanding Indebtedness for the period of four fiscal quarters ending on the date of determination, and (b) Rental Expense paid or accrued in such period.

     “Foreign Subsidiary” means any Subsidiary of the Company other than a Domestic Subsidiary

     “FRB” means the Board of Governors of the Federal Reserve System, and any Governmental Authority succeeding to any of its principal functions.

     “Funded Debt” of any Person means, without duplication, all Indebtedness of such Person.

     “Further Taxes” means any and all present or future taxes, levies, assessments, imposts, duties, deductions, fees, withholdings or similar charges (including, without limitation, net income taxes and franchise taxes), and all liabilities with respect thereto, imposed by any jurisdiction on account of amounts payable or paid pursuant to Section 4.01.

     “FX Trading Office” means the Chicago office of LaSalle, or such other office of LaSalle or ABN AMRO as the Co-Administrative Agent may designate from time to time.

     “GAAP” means generally accepted accounting principles set forth from time to time in the opinions and pronouncements of the Accounting Principles Board and the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board (or agencies with similar functions of comparable stature and authority within the U.S. accounting profession), which are applicable to the circumstances as of the date of determination.

     “Governmental Authority” means any nation or government, any state or other political subdivision thereof, any central bank (or similar monetary or regulatory authority) thereof, any entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government, and any corporation or other entity owned or controlled, through stock or capital ownership or otherwise, by any of the foregoing.

     “Guarantors” means each of the Subsidiaries of the Company from time to time party to the Subsidiary Guaranty.

     “Guaranty Obligation” has the meaning specified in the definition of “Contingent Obligation.”

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     “Hazardous Materials” means all those substances that are regulated by, or which may form the basis of liability or a standard of conduct under, any Environmental Law, including any substance identified under any Environmental Law as a pollutant, contaminant, hazardous waste, hazardous constituent, special waste, hazardous substance, hazardous material, or toxic substance, or petroleum or petroleum-derived substance or waste.

     “Honor Date” has the meaning specified in subsection 3.03(b).

     “Indebtedness” of any Person means, without duplication, (a) all indebtedness for borrowed money; (b) all obligations issued, undertaken or assumed as the deferred purchase price of property or services (other than trade payables entered into in the ordinary course of business on ordinary terms); (c) all reimbursement or payment obligations with respect to Surety Instruments and all L/C Obligations; (d) all obligations evidenced by notes, bonds, debentures or similar instruments, including obligations so evidenced incurred in connection with the acquisition of property, assets or businesses; (e) all indebtedness created or arising under any conditional sale or other title retention agreement, or incurred as financing, in either case with respect to property acquired by the Person (even though the rights and remedies of the seller or bank under such agreement in the event of default are limited to repossession or sale of such property); (f) all Capital Lease Obligations; (g) the principal balance outstanding under any synthetic lease, tax retention operating 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; (h) all indebtedness referred to in clauses (a) through (g) above secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien upon or in property (including accounts and contract rights) owned by such Person, even though such Person has not assumed or become liable for the payment of such Indebtedness; and (i) all Guaranty Obligations in respect of indebtedness or obligations of others of the kinds referred to in clauses (a) through (h) above. For all purposes of this Agreement, the Indebtedness of any Person shall include all recourse Indebtedness of any partnership or joint venture or limited liability company in which such Person is a general partner or a joint venturer or a member and as to which such Person is or may become directly liable.

     “Indemnified Liabilities” has the meaning specified in Section 11.05.

     “Indemnified Person” has the meaning specified in Section 11.05.

     “Independent Auditor” has the meaning specified in subsection 7.01(a).

     “Insolvency Proceeding” means, with respect to any Person, (a) any case, action or proceeding with respect to such Person before any court or other Governmental Authority relating to bankruptcy, reorganization, insolvency, liquidation, receivership, dissolution, winding-up or relief of debtors, or (b) any general assignment for the benefit of creditors, composition, marshalling of assets for creditors, or other, similar arrangement in respect of its creditors generally or any substantial portion of its creditors;

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in each case, undertaken under U.S. Federal, state or foreign law, including the Bankruptcy Code.

     “Intercompany Indebtedness” means Indebtedness of the Company or any of its Subsidiaries which, in the case of the Company, is owing to any Subsidiary of the Company, and which, in the case of any Subsidiary, is owing to the Company or any of its other Subsidiaries.

     “Interest Payment Date” means, as to any Offshore Rate Loan, the last day of each Interest Period applicable to such Loan and, as to any Base Rate Loan, the last Business Day of each calendar quarter; provided, however, that if any Interest Period for an Offshore Rate Loan exceeds three months, the date that falls three months after the beginning of such Interest Period and after each Interest Payment Date thereafter is also an Interest Payment Date.

     “Interest Period” means, as to any Offshore Rate Loan, the period commencing on the Borrowing Date of such Loan or on the Conversion/Continuation Date on which the Loan is converted into or continued as an Offshore Rate Loan, and ending on the date seven days or one, two, three or six months thereafter as selected by the Company in its Notice of Borrowing or Notice of Conversion/Continuation;

provided that:

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

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

     (c) no Interest Period for any Loan shall extend beyond the Termination Date.

     “Investments” has the meaning specified in Section 8.04.

     “IRS” means the Internal Revenue Service, and any Governmental Authority succeeding to any of its principal functions under the Code.

     “Issuance Date” has the meaning specified in subsection 3.01(a).

     “Issue” means, with respect to any Letter of Credit, to issue or to extend the expiry of, or to renew or increase the amount of, such Letter of Credit; and the terms “Issued,” “Issuing” and “Issuance” have corresponding meanings.

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     “Issuer” means either Bank of America or LaSalle in its capacity as issuer of one or more Letters of Credit hereunder, together with any replacement letter of credit issuer arising under subsection 10.01(b) or Section 10.09.

     “Joint Venture” means a single-purpose corporation, partnership, limited liability company, joint venture or other similar legal arrangement (whether created by contract or conducted through a separate legal entity) now or hereafter formed by the Company or any of its Subsidiaries with another Person in order to conduct a common venture or enterprise with such Person.

     “Judgment Currency” has the meaning specified in Section 11.18.

     “LaSalle” means LaSalle Bank National Association, a national banking association.

     “L/C Advance” means each Lender’s participation in any L/C Borrowing in accordance with its Pro Rata Share.

     “L/C Amendment Application” means an application form for amendment of outstanding standby letters of credit as shall at any time be in use at the Issuer, as the Issuer shall request.

     “L/C Application” means an application form for issuances of standby letters of credit as shall at any time be in use at the Issuer, as the Issuer shall request.

     “L/C Borrowing” means an extension of credit resulting from a drawing under any Letter of Credit which shall not have been reimbursed on the date when made nor converted into a Borrowing of Loans under subsection 3.03(d).

     “L/C Commitment” means the commitment of the Issuer to Issue, and the commitment of the Lenders severally to participate in, Letters of Credit from time to time Issued or outstanding under Article III, in an aggregate amount not to exceed $150,000,000 on any date; provided that the L/C Commitment is a part of the Aggregate Commitment, rather than a separate, independent commitment.

     “L/C Obligations” means at any time the sum of (a) the aggregate undrawn amount of all Letters of Credit then outstanding, plus (b) the amount of all unreimbursed drawings under all Letters of Credit, including all outstanding L/C Borrowings.

     “L/C-Related Documents” means the Letters of Credit, the L/C Applications, the L/C Amendment Applications and any other document relating to any Letter of Credit, including any standard form documents used by the Issuer for letter of credit issuances.

     “Lender” has the meaning specified in the introductory clause hereto. References to the “Lenders” shall include Bank of America and LaSalle, including in its capacity as Issuer and as Swing Line Lender; for purposes of clarification only, to the extent that LaSalle may have any rights or obligations in addition to those of the Lenders due to its

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status as an Issuer or as Swing Line Lender, respectively, its status as such will be specifically referenced.

     “Lending Office” means, as to any Lender, the office or offices, branches, subsidiaries or affiliates of such Lender specified as its “Lending Office” or “Domestic Lending Office” or “Offshore Lending Office”, as the case may be, on Schedule 11.02, or such other office or offices, branches, subsidiaries or affiliates as such Lender may from time to time notify the Company and the Agent.

     “Letters of Credit” means (a) each Existing Letter of Credit, and (b) any standby or commercial letter of credit Issued by the Issuer pursuant to Article III on or after the date of this Agreement.

     “Leverage Ratio” means, as of any date of determination, the ratio of (a) all Funded Debt of the Company and its Subsidiaries determined on a consolidated basis as of such date, to (b) EBITDA for the period of four fiscal quarters ending on such date.

     “Lien” means any security interest, mortgage, deed of trust, pledge, hypothecation, assignment, charge or deposit arrangement, encumbrance, lien (statutory or other) or preferential arrangement of any kind or nature whatsoever in respect of any property (including those created by, arising under or evidenced by any conditional sale or other title retention agreement, the interest of a lessor under a capital lease, any financing lease having substantially the same economic effect as any of the foregoing, or the filing of any financing statement naming the owner of the asset to which such lien relates as debtor, under the Uniform Commercial Code or any comparable law) and any contingent or other agreement to provide any of the foregoing, but not including the interest of a lessor under an operating lease.

     “Loan” means an extension of credit by a Lender to the Company under Article II or Article III in the form of a Revolving Loan, Swing Line Loan or L/C Advance.

     “Loan Documents” means this Agreement, any Notes, the Agent Fee Letter, the Co-Administrative Agent Fee Letter, the L/C-Related Documents, the Subsidiary Guaranty, the Rate Swap Documents and all other documents delivered to the Agent, the Co-Administrative Agent or any Lender in connection herewith.

     “Margin Stock” means “margin stock” as such term is defined in Regulation T, U or X of the FRB.

     “Material Adverse Effect” means (a) a material adverse change in, or a material adverse effect upon, the operations, business, assets, liabilities (actual or contingent), condition (financial or otherwise) or prospects of the Company or the Company and its Subsidiaries taken as a whole, or in the facts and information regarding such entities as represented; (b) a material impairment of the ability of the Company or any Subsidiary to perform under any Loan Document and to avoid any Event of Default; or (c) a material adverse effect upon the legality, validity, binding effect or enforceability against the Company or any Subsidiary of any Loan Document.

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     “Multiemployer Plan” means a “multiemployer plan”, within the meaning of Section 4001(a)(3) of ERISA, to which the Company or any ERISA Affiliate makes, is making, or is obligated to make contributions or, during the preceding three calendar years, has made, or been obligated to make, contributions.

     “Net Worth” means the shareholders’ equity of the Company as determined in accordance with GAAP.

     “Note” means a promissory note executed by the Company in favor of a Lender pursuant to subsection 2.02(b).

     “Note Agreements” means, collectively, (a) that certain Amended and Restated Private Shelf Agreement dated as of October 3, 2000 between the Company and the purchasers named therein, as amended by Letter Agreement dated as of May 9, 2002 and Letter Amendment No. 2 dated as of February 28, 2003, (b) the Note Purchase Agreement dated as of March 1, 2002 between the Company and the purchasers named therein, and (c) the Master Note Purchase Agreement dated as of March 15, 2005 between the Company and the purchasers named therein, each as amended, supplemented or modified from time to time.

     “Notice of Borrowing” means a notice in substantially the form of Exhibit A.

     “Notice of Conversion/Continuation” means a notice in substantially the form of Exhibit B.

     “Obligations” means all advances, debts, liabilities, obligations, covenants and duties arising under any Loan Document owing by the Company or any Subsidiary to any Lender, the Agent, the Co-Administrative Agent or any Indemnified Person, whether direct or indirect (including those acquired by assignment), absolute or contingent, due or to become due, now existing or hereafter arising.

     “Offshore Currency” means at any time, Euros, pounds sterling, Canadian dollars and any Agreed Alternative Currency.

     “Offshore Currency Loan” means any Offshore Rate Loan denominated in an Offshore Currency.

     “Offshore Currency Loan Sublimit” means $25,000,000.

     “Offshore Rate” means, for any Interest Period, with respect to Offshore Rate Loans comprising part of the same Borrowing, the rate of interest per annum (rounded upward to the next 1/100th of 1%) determined by the Agent as follows:

Offshore	Rate           =                     LIBOR
	1.00 - Eurodollar Reserve Percentage

     Where,

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     “Eurodollar Reserve Percentage” means for any day for any Interest Period the maximum reserve percentage (expressed as a decimal, rounded upward to the next 1/100th of 1%) in effect on such day (whether or not applicable to any Lender) under regulations issued from time to time by the FRB for determining the maximum reserve requirement (including any emergency, supplemental or other marginal reserve requirement) with respect to Eurocurrency funding (currently referred to as “Eurocurrency liabilities”); and

     “LIBOR” means the rate of interest per annum determined by the Co-Administrative Agent as the rate at which deposits in the Applicable Currency in the approximate amount of the amount of the Loan to be made or continued as, or converted into, an Offshore Rate Loan by the Co-Administrative Agent and having a maturity comparable to such Interest Period would be offered in the London interbank eurodollar market at approximately 11:00 a.m. (London time) two Business Days prior to the commencement of such Interest Period, as displayed in the Bloomberg Financial Markets system, or other authoritative source selected by the Co-Administrative Agent in its sole discretion.

     The Offshore Rate shall be adjusted automatically as to all Offshore Rate Loans then outstanding as of the effective date of any change in the Eurodollar Reserve Percentage.

     “Offshore Rate Loan” means a Loan that bears interest based on the Offshore Rate and may be an Offshore Currency Loan or a Loan denominated in Dollars.

     “Organization Documents” means, for any corporation, the certificate or articles of incorporation, the bylaws, any certificate of determination or instrument relating to the rights of preferred shareholders of such corporation, any shareholder rights agreement, and all applicable resolutions of the board of directors (or any committee thereof) of such corporation.

     “Other Taxes” means any present or future stamp, court or documentary taxes or any other excise or property taxes, charges or similar levies which arise from any payment made hereunder or from the execution, delivery, performance, enforcement or registration of, or otherwise with respect to, this Agreement or any other Loan Documents.

     “Overnight Rate” means, for any day, the rate of interest per annum at which overnight deposits in the Applicable Currency, in the amount approximately equal to the amount with respect to which such rate is being determined, would be offered for such day by ABN AMRO’s London Branch to major banks in the London or other applicable offshore interbank market.

     “Participant” has the meaning specified in subsection 11.08(e).

     “PBGC” means the Pension Benefit Guaranty Corporation, or any Governmental Authority succeeding to any of its principal functions under ERISA.

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     “Pension Plan” means a pension plan (as defined in Section 3(2) of ERISA) subject to Title IV of ERISA which the Company or any ERISA Affiliate sponsors, maintains, or to which it makes, is making, or is obligated to make contributions, or otherwise has any liability, or in the case of a multiple employer plan (as described in Section 4064(a) of ERISA) has made contributions at any time during the immediately preceding five (5) plan years.

     “Permitted Acquisitions” has the meaning specified in Section 8.04.

     “Permitted Liens” has the meaning specified in Section 8.01.

     “Permitted Swap Obligations” means all obligations (contingent or otherwise) of the Company existing or arising under Swap Contracts, provided that each of the following criteria is satisfied: (a) such obligations are (or were) entered into by such Person in the ordinary course of business for the purpose of directly mitigating risks associated with liabilities, commitments or assets held or reasonably anticipated by such Person, or changes in the value of securities issued by such Person in conjunction with a securities repurchase program not otherwise prohibited hereunder, and not for purposes of speculation or taking a “market view”, and (b) such Swap Contracts do not contain any provision (“walk-away” provision) exonerating the non-defaulting party from its obligation to make payments on outstanding transactions to the defaulting party (i.e; such Swap Contracts do not elect the “first method” of calculating a termination payment) under the 1992 Master ISDA Agreement.

     “Person” means an individual, partnership, corporation, limited liability company, business trust, joint stock company, trust, unincorporated association, joint venture or Governmental Authority.

     “Plan” means an employee benefit plan (as defined in Section 3(3) of ERISA) which the Company or any ERISA Affiliate sponsors or maintains or to which the Company or any ERISA Affiliate makes, is making, or is obligated to make contributions or otherwise has any liability and includes any Pension Plan.

     “Prior Credit Agreement” - see first Recital.

     “Property” means any interest in any kind of property or asset, whether real, personal or mixed, and whether tangible or intangible.

     “Pro Rata Share” means, as to any Lender, (a) at any time at which the Aggregate Commitment remains 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 all Loans divided by the Aggregate Commitment, and (b) after the termination of the Aggregate Commitment, 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 (including such Lender’s ratable share of outstanding Swing Line Loans and L/C Obligations) divided by the aggregate principal amount of the outstanding Loans and L/C Obligations of all of the Lenders.

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     “Rate Swap Documents” means, collectively, all Swap Contracts entered into between the Company and any Lender in respect of any portion of the Obligations.

     “Rental Expense” means, for any period, the sum of (a) all store rental payments, (b) all common area maintenance payments and (c) all real estate taxes paid by the Company and its Subsidiaries, in each case, with respect to any non-franchised store location(s).

     “Reportable Event” means, any of the events set forth in Section 4043(c) of ERISA or the regulations thereunder, other than any such event for which the 30-day notice requirement under ERISA has been waived in regulations issued by the PBGC.

     “Required Lenders” means at any time Lenders then holding more than 50% of the Aggregate Commitment (or if the Aggregate Commitment has been terminated, then the aggregate principal amount outstanding of Revolving Loans and Swing Line Loans, plus the outstanding amount of L/C Obligations).

     “Requirement of Law” means, as to any Person, any law (statutory or common), treaty, rule or regulation or determination of an arbitrator or of a Governmental Authority, in each case applicable to or binding upon the Person or any of its property or to which the Person or any of its property is subject.

     “Responsible Officer” means the chief financial officer of the Company or any other officer having substantially the same authority and responsibility.

     “Restatement Date” means the date on which all conditions precedent set forth in Section 5.01 are satisfied or waived by all Lenders (or, in the case of subsection 5.01(e), waived by the Person entitled to receive such payment).

     “Revolving Loan” has the meaning specified in Section 2.01.

     “Same Day Funds” means (a) with respect to disbursements and payments in Dollars, immediately available funds, and (b) with respect to disbursements and payments in an Offshore Currency, same day or other funds as may be determined by the Agent to be customary in the place of disbursement or payment for the settlement of international banking transactions in the relevant Offshore Currency.

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

     “Solvent” means, when used with respect to a Person, that (a) the fair saleable value of the assets of such Person is in excess of the total amount of the present value of its liabilities (including for purposes of this definition all liabilities (including loss reserves as determined by such Person), whether or not reflected on a balance sheet prepared in accordance with GAAP and whether direct or indirect, fixed or contingent, secured or unsecured, disputed or undisputed), (b) such Person is able to pay its debts or obligations in the ordinary course as they mature and (c) such Person does not have

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unreasonably small capital to carry out its business as conducted and as proposed to be conducted. “Solvency” shall have a correlative meaning.

     “Specified Acquisition Debt” means Indebtedness of a Person that was the subject of an Acquisition by the Company or any Subsidiary in an aggregate amount not to exceed $10,000,000 at any one time outstanding, (a) which remains outstanding no more than 90 days after the date on which such Acquisition was consummated, (b) which is the subject of a default under the terms thereof solely as a result of the consummation of such Acquisition, and (c) which has not been accelerated or otherwise become immediately repayable and in respect of which the lenders thereof have not exercised any available remedies.

     “Spot Rate” for a currency means the rate quoted by LaSalle as the spot rate for the purchase by LaSalle of such currency with another currency through its FX Trading Office at approximately 8:00 a.m. (Chicago time) on the date two Banking Days prior to the date as of which the foreign exchange computation is made.

     “Subsidiary” of a Person means any corporation, association, partnership, limited liability company, joint venture or other business entity of which more than 50% of the voting stock, membership interests or other equity interests (in the case of Persons other than corporations), is owned or controlled directly or indirectly by the Person, or one or more of the Subsidiaries of the Person, or a combination thereof. Unless the context otherwise clearly requires, references herein to a “Subsidiary” refer to a Subsidiary of the Company.

     “Subsidiary Guaranty” means that certain Guaranty dated as of the Restatement Date by certain of the Subsidiaries in favor of the Agent, the Co-Administrative Agent and the Lenders, in the form attached hereto as Exhibit E.

     “Surety Instruments” means all letters of credit (including standby and commercial), banker’s acceptances, bank guaranties, shipside bonds, performance bonds, surety bonds and similar instruments.

     “Swap Contract” means any agreement, whether or not in writing, relating to any transaction that is a rate swap, basis swap, forward rate transaction, commodity swap, commodity option, equity or equity index swap or option, bond, note or bill option, interest rate option, forward foreign exchange transaction, cap, collar or floor transaction, currency swap, cross-currency rate swap, swaption, currency option or any other, similar transaction (including any option to enter into any of the foregoing) or any combination of the foregoing, and, unless the context otherwise clearly requires, any master agreement relating to or governing any or all of the foregoing.

     “Swap Termination Value” means, in respect of any one or more Swap Contracts, after taking into account the effect of any legally enforceable netting agreement relating to such Swap Contracts, (a) for any date on or after the date such Swap Contracts have been closed out and termination value(s) determined in accordance therewith, such termination value(s), and (b) for any date prior to the date referenced in clause (a) the

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amount(s) determined as the mark-to-market value(s) for such Swap Contracts, as determined by the Company based upon one or more mid-market or other readily available quotations provided by any recognized dealer in such Swap Contracts (which may include any Lender).

     “Swing Line Commitment” means at any time, the obligation of the Swing Line Lender to make Swing Line Loans pursuant to Section 2.05.

     “Swing Line Lender” means LaSalle, in its capacity as provider of the Swing Line Loans.

     “Swing Line Loan” means a Loan made by the Swing Line Lender.

     “Taxes” means any and all present or future taxes, levies, assessments, imposts, duties, deductions, fees, withholdings or similar charges, and all liabilities with respect thereto, excluding, in the case of each Lender, the Agent and the Co-Administrative Agent, respectively, taxes imposed on or measured by its net income by the jurisdiction (or any political subdivision thereof) under the laws of which such Lender, the Agent or the Co-Administrative Agent, as the case may be, is organized or maintains a Lending Office.

     “Termination Date” means the earlier to occur of:

     (a) April 7, 2010; and

     (b) the date on which the Aggregate Commitment terminates in accordance with the provisions of this Agreement.

     A “Type” of Loan means its status as either a Base Rate Loan or an Offshore Rate Loan.

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

     “United States” and “U.S.” each means the United States of America.

     “Wholly-Owned” means any corporation, association, partnership, limited liability company, joint venture or other business entity in which (other than directors’ qualifying shares or other immaterial local ownership required by law) 100% of the equity interests of each class having ordinary voting power, and 100% of the equity interests of every other class, in each case, at the time as of which any determination is being made, is owned, beneficially and of record, by the Company, or by one or more of the other Wholly-Owned Subsidiaries, or both.

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

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          (b) The words “hereof”, “herein”, “hereunder” and similar words refer to this Agreement as a whole and not to any particular provision of this Agreement; and subsection, Section, Schedule and Exhibit references are to this Agreement unless otherwise specified.

          (c) (i) The term “documents” includes any and all instruments, documents, agreements, certificates, indentures, notices and other writings, however evidenced.

               (ii) The term “including” is not limiting and means “including without limitation.”

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

               (iv) The term “property” includes any kind of property or asset, real, personal or mixed, tangible or intangible.

          (d) Unless otherwise expressly provided herein, (i) references to agreements (including this Agreement) and other contractual instruments shall be deemed to include all subsequent amendments and other modifications thereto, but only to the extent such amendments and other modifications are not prohibited by the terms of any Loan Document, and (ii) references to any statute or regulation are to be construed as including all statutory and regulatory provisions consolidating, amending, replacing, supplementing or interpreting the statute or regulation.

          (e) The captions and headings of this Agreement are for convenience of reference only and shall not affect the interpretation of this Agreement.

          (f) This Agreement and other Loan Documents may use several different limitations, tests or measurements to regulate the same or similar matters. All such limitations, tests and measurements are cumulative and shall each be performed in accordance with their terms. Unless otherwise expressly provided, any reference to any act of the Agent, the Co-Administrative Agent or the Lenders by way of consent, approval or waiver shall be deemed modified by the phrase “in its/their sole discretion”.

          (g) This Agreement and the other Loan Documents are the result of negotiations among and have been reviewed by counsel to the Agent, the Co-Administrative Agent, the Company and the other parties, and are the products of all parties. Accordingly, they shall not be construed against the Lenders, the Agent or the Co-Administrative Agent merely because of the Agent’s, the Co-Administrative Agent’s or the Lenders’ involvement in their preparation.

     1.03 Accounting Principles. (a) Unless the context otherwise clearly requires, all accounting terms not expressly defined herein shall be construed, and all financial computations required under this Agreement shall be made, in accordance with GAAP, consistently applied.

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          (b) References herein to “fiscal year” and “fiscal quarter” refer to such fiscal periods of the Company.

          (c) In the event that any changes in GAAP occur after the date of this Agreement and such changes result in a material variation in the method of calculation of financial covenants or other terms of this Agreement, then the Company, the Agent, the Co-Administrative Agent, and the Lenders agree to amend such provisions of this Agreement so as to equitably reflect such changes so that the criteria for evaluating the Company’s financial condition will be the same after such changes as if such changes had not occurred.

     1.04 Currency Equivalents Generally. For all purposes of this Agreement (but not for purposes of the preparation of any financial statements delivered pursuant hereto), the equivalent in any Offshore Currency or other currency of an amount in Dollars, and the equivalent in Dollars of an amount in any Offshore Currency or other currency, shall be determined at the Spot Rate.

ARTICLE II

THE CREDITS

     2.01 Amounts and Terms of Commitments. Each Lender severally agrees, on the terms and conditions set forth herein, to make loans to the Company denominated in Dollars or in an Offshore Currency (each such loan, a “Revolving Loan”) from time to time on any Business Day during the period from the Restatement Date to the Termination Date, in an aggregate principal Dollar Equivalent amount not to exceed at any time outstanding the amount set forth opposite such Lender’s name on Schedule 2.01 (such amount, as the same may be reduced under Section 2.07 or as a result of one or more assignments under Section 11.08, the Lender’s “Commitment”); provided, however, that, after giving effect to any Borrowing of Revolving Loans, the Effective Amount of all outstanding Loans and of all L/C Obligations, shall not at any time exceed the Aggregate Commitment; provided further, that the Effective Amount of the Revolving Loans of any Lender plus the participation of such Lender in the Dollar Equivalent of the Effective Amount of all L/C Obligations and such Lender’s Pro Rata Share of any outstanding Swing Line Loans shall not at any time exceed such Lender’s Commitment; and provided further, that after giving effect to any Borrowing of Offshore Currency Loans, the Effective Amount of all outstanding Offshore Currency Loans shall not exceed the Offshore Currency Loan Sublimit. Within the limits of each Revolving Lender’s Commitment, and subject to the other terms and conditions hereof, the Company may borrow under this Section 2.01, prepay under Section 2.08 and reborrow under this Section 2.01.

     2.02 Loan Accounts. (a) The Loans made by each Lender and the Letters of Credit Issued by the Issuer shall be evidenced by one or more accounts or records maintained by such Lender or Issuer, as the case may be, in the ordinary course of business. The accounts or records maintained by the Co-Administrative Agent, the Issuer and each Lender shall be conclusive absent manifest error of the amount of the Loans made by the Lenders to the Company and the Letters of Credit Issued for the account of the Company, and the interest and payments thereon. Any failure so to record or any error in doing so shall not, however, limit or otherwise affect the

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obligation of the Company hereunder to pay any amount owing with respect to the Loans or any Letter of Credit.

          (b) Upon the request of any Lender made through the Co-Administrative Agent, the Loans made by such Lender may be evidenced by one or more Notes, instead of or in addition to loan accounts. Each such Lender shall record on the schedule annexed to its Note(s) the date, amount and maturity of each Loan made by it and the amount and Applicable Currency of each payment of principal made by the Company with respect thereto. Each such Lender is irrevocably authorized by the Company to make such recordation on its Note, and each Lender’s record shall be conclusive absent manifest error; provided, however, that the failure of a Lender to make, or an error in making, a notation thereon with respect to any Loan shall not limit or otherwise affect the obligations of the Company hereunder or under any such Note to such Lender.

     2.03 Procedure for Borrowing. (a) Each Borrowing (other than an L/C Advance) shall be made upon the Company’s irrevocable notice delivered to the Co-Administrative Agent in the form of a Notice of Borrowing (which notice must be received by the Co-Administrative Agent prior to 12:00 p.m. (Chicago time) (i) three Business Days prior to the requested Borrowing Date, in the case of Offshore Rate Loans denominated in Dollars, (ii) four Business Days prior to the requested Borrowing Date, in the case of Offshore Currency Loans, and (iii) on the requested Borrowing Date, in the case of Base Rate Loans), specifying:

                    (A) the amount of the Borrowing, which shall be in an aggregate minimum amount of $2,500,000 or any multiple of $500,000 in excess thereof;

                    (B) the requested Borrowing Date, which shall be a Business Day;

                    (C) the Type of Loans comprising the Borrowing and in the case of an Offshore Rate Loan, the Applicable Currency; and

                    (D) with respect to Offshore Rate Loans, the duration of the Interest Period applicable to such Loans included in such notice. If the Notice of Borrowing fails to specify the duration of the Interest Period for any Borrowing comprised of Offshore Rate Loans, such Interest Period shall be one month;

provided, however, that with respect to any Borrowing initially made on the Restatement Date, such Borrowing will consist of Base Rate Loans only.

          (b) The Co-Administrative Agent will promptly notify each Lender of its receipt of any Notice of Borrowing and of the amount of such Lender’s Pro Rata Share of that Borrowing.

          (c) Each Lender will make the amount of its Pro Rata Share of each Borrowing available to the Co-Administrative Agent for the account of the Company at the Co-Administrative Agent’s Payment Office on the Borrowing Date requested by the Company in Same Day Funds and in the requested currency (i) in the case of a Borrowing comprised of

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Loans in Dollars, by 2:00 p.m. (Chicago time), and (ii) in the case of a Borrowing comprised of Offshore Currency Loans, by such time as the Co-Administrative Agent may specify. The proceeds of all such Loans will promptly thereafter be made available to the Company by the Co-Administrative Agent at such office by crediting the account of the Company on the books of LaSalle with the aggregate of the amounts made available to the Co-Administrative Agent by the Lenders and in like funds as received by the Co-Administrative Agent.

          (d) After giving effect to any Borrowing or any conversion or continuation of Loans pursuant to Section 2.04, unless the Co-Administrative Agent shall otherwise consent, there may not be more than 10 different Interest Periods in effect.

          (e) The Company hereby authorizes the Lenders and the Co-Administrative Agent to accept Notices of Borrowing based on telephonic notices made by any person or persons the Co-Administrative Agent or any Lender in good faith believes to be acting on behalf of the Company. The Company agrees to deliver promptly to the Co-Administrative Agent a written confirmation of each telephonic notice, signed by a Responsible Officer or an authorized designee. If the written confirmation differs in any material respect from the action taken by the Co-Administrative Agent and the Lenders, the records of the Co-Administrative Agent and the Lenders shall govern absent manifest error.

     2.04 Conversion and Continuation Elections. (a) The Company may, upon irrevocable notice to the Co-Administrative Agent in accordance with subsection 2.04(b):

                    (i) elect, as of any Business Day, in the case of Base Rate Loans, or as of the last day of the applicable Interest Period, in the case of Offshore Rate Loans, to convert any such Loans (or any part thereof in an amount not less than $500,000 or that is in an integral multiple of $100,000 in excess thereof) into Loans of any other Type; or

                    (ii) elect as of the last day of the applicable Interest Period, to continue any Loans having Interest Periods expiring on such day (or any part thereof in an amount not less than $500,000, or that is in an integral multiple of $100,000 in excess thereof);

provided, that if at any time the aggregate amount of Offshore Rate Loans denominated in Dollars in respect of any Borrowing is reduced, by payment, prepayment, or conversion of part thereof to be less than $500,000 such Offshore Rate Loans denominated in Dollars shall automatically convert into Base Rate Loans, and on and after such date the right of the Company to continue such Loans as, and convert such Loans into, Offshore Rate Loans shall terminate.

          (b) The Company shall deliver a Notice of Conversion/Continuation to be received by the Co-Administrative Agent not later than 12:00 p.m. (Chicago time) at least (i) three Business Days in advance of the Conversion/Continuation Date, if the Loans are to be converted into or continued as Offshore Rate Loans in Dollars, (ii) four Business Days in advance of the Conversion/Continuation Date, if the Loans are to be converted into or continued as Offshore Currency Loans, and (iii) on the Conversion/Continuation Date, if the Loans are to be converted into Base Rate Loans, specifying:

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                    (A) the proposed Conversion/Continuation Date;

                    (B) the aggregate amount of Loans to be converted or continued;

                    (C) the Type of Loans resulting from the proposed conversion or continuation and in the case of an Offshore Rate Loan, the Applicable Currency; and

                    (D) other than in the case of conversions into Base Rate Loans, the duration of the requested Interest Period.

          (c) If upon the expiration of any Interest Period applicable to Offshore Rate Loans denominated in Dollars, the Company has failed to select timely a new Interest Period to be applicable to such Offshore Rate Loans, or if any Default or Event of Default then exists, the Company shall be deemed to have elected to convert such Offshore Rate Loans into Base Rate Loans effective as of the expiration date of such Interest Period. If the Company has failed to select a new Interest Period to be applicable to Offshore Currency Loans prior to the fourth Business Day in advance of the expiration date of the current Interest Period applicable thereto as provided in subsection 2.04(b), or if any Default or Event of Default shall then exist, subject to the provisions of subsection 2.06(d), the Company shall be deemed to have elected to continue such Offshore Currency Loans on the basis of a one-month Interest Period.

          (d) The Co-Administrative Agent will promptly notify each Lender of its receipt of a Notice of Conversion/Continuation, or, if no timely notice is provided by the Company, the Co-Administrative Agent will promptly notify each Lender of the details of any automatic conversion. All conversions and continuations shall be made ratably according to the respective outstanding principal amounts of the Loans, with respect to which the notice was given, held by each Lender.

          (e) Unless the Required Lenders otherwise consent, during the existence of a Default or Event of Default, the Company may not elect to have a Loan in Dollars converted into or continued as an Offshore Rate Loan in Dollars, or an Offshore Currency Loan continued on the basis of an Interest Period exceeding one month.

          (f) The Company hereby authorizes the Lenders and the Co-Administrative Agent to accept Notices of Conversion/Continuation based on telephonic notices made by any person or persons the Co-Administrative Agent or any Lender in good faith believes to be acting on behalf of the Company. The Company agrees to deliver promptly to the Co-Administrative Agent a written confirmation of each telephonic notice, signed by a Responsible Officer. If the written confirmation differs in any material respect from the action taken by the Co-Administrative Agent and the Lenders, the records of the Co-Administrative Agent and the Lenders shall govern absent manifest error.

     2.05 The Swing Line Loans. (a) Subject to the terms and conditions hereof, the Swing Line Lender agrees to make Swing Line Loans to the Company denominated in Dollars from time to time prior to the Termination Date in an aggregate principal amount at any one time outstanding not to exceed $20,000,000; provided, that after giving effect to any such Swing Line

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Loan, the Effective Amount of all Revolving Loans, Swing Line Loans and L/C Obligations at such time would not exceed the Aggregate Commitment at such time; provided, further, that notwithstanding Section 2.01, the aggregate amount of the Revolving Loans and Swing Line Loans of the Swing Line Lender, plus the participation of the Swing Line Lender in the Dollar Equivalent of the Effective Amount of all L/C Obligations, may exceed LaSalle’s Commitment so long as the condition set forth in the previous proviso is satisfied. Prior to the Termination Date, the Company may use the Swing Line Commitment by borrowing, prepaying the Swing Line Loans in whole or in part, and reborrowing, all in accordance with the terms and conditions hereof. All Swing Line Loans shall bear interest at the Base Rate and shall not be entitled to be converted into Loans that bear interest at any other rate.

          (b) The Company may borrow under the Swing Line Commitment on any Business Day until the Termination Date; provided, that the Company shall give the Swing Line Lender irrevocable written notice signed by a Responsible Officer or an authorized designee (which notice must be received by the Swing Line Lender prior to 3:00 p.m. (Chicago time)) with a copy to the Co-Administrative Agent specifying the amount of the requested Swing Line Loan, which shall be in a minimum amount of $250,000 or a whole multiple of $250,000 in excess thereof. The proceeds of the Swing Line Loan will be made available by the Swing Line Lender to the Company in immediately available funds at the office of the Swing Line Lender by 4:00 p.m. (Chicago time) on the date of such notice. The Company may at any time and from time to time, prepay the Swing Line Loans, in whole or in part, without premium or penalty, by notifying the Swing Line Lender prior to 3:00 p.m. (Chicago time) on any Business Day of the date and amount of prepayment with a copy to the Co-Administrative Agent. If any such notice is given, the amount specified in such notice shall be due and payable on the date specified therein. Partial prepayments shall be in an aggregate principal amount of $250,000 or a whole multiple of $250,000 in excess thereof.

          (c) If any Swing Line Loan shall remain outstanding at 11:00 a.m. (Chicago time) on the fifth day following the date of such Swing Line Loan and if by such time on such fifth day the Co-Administrative Agent shall have received neither (i) a Notice of Borrowing delivered by the Company pursuant to Section 2.03 requesting that Revolving Loans be made pursuant to Section 2.01 on the immediately succeeding Business Day in an amount at least equal to the principal amount of such Swing Line Loan nor (ii) any other notice satisfactory to the Co-Administrative Agent indicating the Company’s intent to repay such Swing Line Loan on or before the immediately succeeding Business Day with funds obtained from other sources, then on such Business Day the Swing Line Lender shall (and on any Business Day the Swing Line Lender in its sole discretion may), on behalf of the Company (which hereby irrevocably directs the Swing Line Lender to act on its behalf) request the Co-Administrative Agent to notify each Lender to make a Base Rate Loan in an amount equal to such Lender’s Pro Rata Share of (A) in the case of such a request which is required to be made, the amount of the relevant Swing Line Loan and (B) in the case of such a discretionary request, the aggregate principal amount of the Swing Line Loans outstanding on the date such notice is given. Unless any of the events described in subsection 9.01(f) or (g) shall have occurred with respect to the Company (in which event the procedures of paragraph (e) of this Section 2.05 shall apply) each Lender shall make the proceeds of its Revolving Loan available to the Co-Administrative Agent for the account of the Swing Line Lender at the Co-Administrative Agent’s Payment Office in funds immediately available prior to 1:00 p.m. (Chicago time) on the Business Day next succeeding the date such

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notice is given. The proceeds of such Revolving Loans shall be immediately applied to repay the outstanding Swing Line Loans. Effective on the day such Revolving Loans are made, the portion of the Swing Line Loans so paid shall no longer be outstanding as Swing Line Loans and shall no longer be due under the Swing Line Note. The Company shall pay to the Swing Line Lender, promptly following the Swing Line Lender’s demand, the amount of its outstanding Swing Line Loans to the extent amounts received from the Lenders are not sufficient to repay in full such outstanding Swing Line Loans.

          (d) Notwithstanding anything herein to the contrary, the Swing Line Lender (i) shall not be obligated to make any Swing Line Loan if the conditions set forth in Article V have not been satisfied and (ii) shall not make any requested Swing Line Loan if, prior to 11:00 a.m. (Chicago time) on the date of such requested Swing Line Loan, it has received a written notice from the Agent, the Co-Administrative Agent or any Lender directing it not to make further Swing Line Loans because one or more of the conditions specified in Article V are not then satisfied.

          (e) If prior to the making of a Revolving Loan required to be made by subsection 2.05(c) an Event of Default described in subsection 9.01(f) or 9.01(g) shall have occurred and be continuing with respect to the Company, each Lender will, on the date such Revolving Loan was to have been made pursuant to the notice described in subsection 2.05(b), purchase an undivided participating interest in the outstanding Swing Line Loans in an amount equal to its Pro Rata Share of the aggregate principal amount of Swing Line Loans then outstanding. Each Lender will immediately transfer to the Co-Administrative Agent for the benefit of the Swing Line Lender, in immediately available funds, the amount of its participation.

          (f) Whenever, at any time after a Lender has purchased a participating interest in a Swing Line Loan, the Swing Line Lender receives any payment on account thereof, the Swing Line Lender will distribute to the Co-Administrative Agent for delivery to each Lender its participating interest in such amount (appropriately adjusted, in the case of interest payments, to reflect the period of time during which such Lender’s participating interest was outstanding and funded); provided, however, that in the event that such payment received by the Swing Line Lender is required to be returned, such Lender will return to the Co-Administrative Agent for delivery to the Swing Line Lender any portion thereof previously distributed by the Swing Line Lender to it.

          (g) Each Lender’s obligation to make the Revolving Loans referred to in subsection 2.05(c) and to purchase participating interests pursuant to subsection 2.05(e) shall be absolute and unconditional and shall not be affected by any circumstance, including, without limitation, (i) any set-off, counterclaim, recoupment, defense or other right which such Lender or the Company may have against the Swing Line Lender, the Company or any other Person for any reason whatsoever, (ii) the occurrence or continuance of a Default or an Event of Default, (iii) any adverse change in the condition (financial or otherwise) of the Company, (iv) any breach of this Agreement or any other Loan Document by the Company, any Subsidiary or any other Lender, or (v) any other circumstance, happening or event whatsoever, whether or not similar to any of the foregoing.

   2.06 Utilization of Commitments in an Alternative Currency.

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          (a) The Co-Administrative Agent will determine the Dollar Equivalent amount with respect to any (i) Borrowing comprised of Alternative Currency Loans as of the requested Borrowing Date, (ii) outstanding Offshore Currency Loans as of the last Banking Day of each month, and (iii) outstanding Offshore Currency Loans as of any redenomination date pursuant to this Section 2.06 or Section 4.05 (each such date under clauses (i) through (iii) a “Computation Date”). Upon receipt of any Notice of Borrowing, the Co-Administrative Agent will promptly notify each Revolving Lender thereof and of the amount of such Lender’s Pro Rata Share of the Borrowing. In the case of a Borrowing comprised of Offshore Currency Loans, such notice will provide the approximate amount of each Lender’s Pro Rata Share of the Borrowing, and the Co-Administrative Agent will, upon the determination of the Dollar Equivalent amount of the Borrowing as specified in the Notice of Borrowing, promptly notify each Lender of the exact amount of such Lender’s Pro Rata Share of the Borrowing.

          (b) In the case of a proposed Borrowing comprised of Offshore Currency Loans, the Lenders shall be under no obligation to make Offshore Currency Loans in the requested Offshore Currency as part of such Borrowing if the Co-Administrative Agent has received notice from any of the Lenders by 12:00 p.m. (Chicago time) four Business Days prior to the day of such Borrowing that such Lender cannot provide Loans in the requested Offshore Currency, in which event the Co-Administrative Agent will give notice to the Company no later than 9:30 a.m. (Chicago time) on the third Business Day prior to the requested date of such Borrowing that the Borrowing in the requested Offshore Currency is not then available, and notice thereof also will be given promptly by the Co-Administrative Agent to the Lenders. If the Co-Administrative Agent shall have so notified the Company that any such Borrowing in a requested Offshore Currency is not then available, the Company may, by notice to the Co-Administrative Agent not later than 10:30 a.m. (Chicago time) three Business Days prior to the requested date of such Borrowing, withdraw the Notice of Borrowing relating to such requested Borrowing. If the Company does so withdraw such Notice of Borrowing, the Borrowing requested therein shall not occur and the Co-Administrative Agent will promptly so notify each Lender. If the Company does not so withdraw such Notice of Borrowing, the Co-Administrative Agent will promptly so notify each Lender and such Notice of Borrowing shall be deemed to be a Notice of Borrowing that requests a Borrowing comprised of Base Rate Loans in an aggregate amount equal to the amount of the originally requested Borrowing as expressed in Dollars in the Notice of Borrowing, and in such notice by the Co-Administrative Agent to each Lender the Co-Administrative Agent will state such aggregate amount of such Borrowing in Dollars and such Lender’s Pro Rata Share thereof.

          (c) In the case of a proposed continuation of Offshore Currency Loans for an additional Interest Period pursuant to Section 2.04, the Lenders shall be under no obligation to continue such Offshore Currency Loans if the Co-Administrative Agent has received notice from any of the Lenders by 4:00 p.m. (Chicago time) three Business Days prior to the day of such continuation that such Lender cannot continue to provide Loans in the Offshore Currency, in which event the Co-Administrative Agent will give notice to the Company not later than 9:00 a.m. (Chicago time) on the second Business Day prior to the requested date of such continuation that the continuation of such Offshore Currency Loans in the Offshore Currency is not then available, and notice thereof also will be given promptly by the Co-Administrative Agent to the Lenders. If the Co-Administrative Agent shall have so notified the Company that any such continuation of Offshore Currency Loans is not then available, any Notice of

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Continuation/Conversion with respect thereto shall be deemed withdrawn and such Offshore Currency Loans shall be redenominated into Base Rate Loans in Dollars with effect from the last day of the Interest Period with respect to any such Offshore Currency Loans. The Co-Administrative Agent will promptly notify the Company and the Lenders of any such redenomination and in such notice by the Co-Administrative Agent to each Lender the Co-Administrative Agent will state the aggregate Dollar Equivalent amount of the redenominated Offshore Currency Loans as of the Computation Date with respect thereto and such Lender’s Pro Rata Share thereof.

          (d) Notwithstanding anything herein to the contrary, during the existence of a Default or an Event of Default, upon the request of the Required Lenders, all or any part of any outstanding Offshore Currency Loans shall be redenominated and converted into Base Rate Loans in Dollars with effect from the last day of the Interest Period with respect to any such Offshore Currency Loans. The Co-Administrative Agent will promptly notify the Company of any such redenomination and conversion request.

          (e) The Company shall be entitled to request that Revolving Loans hereunder also be permitted to be made in any other lawful currency constituting a eurocurrency (other than Dollars), in addition to the eurocurrencies specified in the definition of “Offshore Currency” herein, that in the opinion of the Required Lenders is at such time freely traded in the offshore interbank foreign exchange markets and is freely transferable and freely convertible into Dollars (an “Agreed Alternative Currency”). The Company shall deliver to the Co-Administrative Agent any request for designation of an Agreed Alternate Currency in accordance with Section 11.02, to be received by the Co-Administrative Agent not later than 11:00 a.m. (Chicago time) at least ten Business Days in advance of the date of any Borrowing hereunder proposed to be made in such Agreed Alternate Currency. Upon receipt of any such request the Co-Administrative Agent will promptly notify the Lenders thereof, and each Lender will use its best efforts to respond to such request within two Business Days of receipt thereof and any failure to respond in such time period shall be deemed to be a rejection thereof. Each Lender may grant or accept such request in its sole discretion. The Co-Administrative Agent will promptly notify the Company of the acceptance or rejection of any such request.

     2.07 Voluntary Termination or Reduction of Revolving Loan Commitments. (a) The Company may, upon not less than five Business Days’ prior notice to the Agent and the Co-Administrative Agent, terminate the Commitments, or permanently reduce the Commitments by an aggregate minimum amount of $5,000,000 or any multiple of $1,000,000 in excess thereof; unless, after giving effect thereto and to any prepayments of Loans made on the effective date thereof, (a) the then outstanding Dollar Equivalent Effective Amount of all Revolving Loans, Swing Line Loans and L/C Obligations together would exceed the amount of the Aggregate Commitment then in effect, (b) the Effective Amount of all L/C Obligations then outstanding would exceed the L/C Commitment or (c) the Effective Amount of all Offshore Currency Loans would exceed the Offshore Currency Loan Sublimit. Once reduced in accordance with this Section, the Commitments may not be increased. Any reduction of the Commitments shall be applied to each Lender according to its Pro Rata Share. If and to the extent specified by the Company in the notice to the Agent and the Co-Administrative Agent, some or all of the reduction in the Aggregate Commitment shall be applied to reduce the L/C Commitment and/or the Offshore Currency Loan Sublimit. All accrued commitment fees and letter of credit fees to,

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but not including, the effective date of any reduction or termination of Commitments, shall be paid on the effective date of such reduction or termination.

          (b) At no time shall the Swing Line Commitment exceed the Aggregate Commitment, and any reduction of the Aggregate Commitment which reduces the Aggregate Commitment below the then-current amount of the Swing Line Commitment shall result in an automatic corresponding reduction of the Swing Line Commitment to the amount of the Aggregate Commitment, as so reduced, without any action on the part of the Swing Line Lender. At no time shall the Swing Line Commitment exceed the Commitment of the Swing Line Lender, and any reduction of the Aggregate Commitment which reduces the Commitment of the Swing Line Lender below the then-current amount of the Swing Line Commitment shall result in an automatic corresponding reduction of the Swing Line Commitment to the amount of the Commitment of the Swing Line Lender, as so reduced, without any action on the part of the Swing Line Lender.

     2.08 Prepayments. (a) Subject to Section 4.04, the Company may, at any time or from time to time, upon not less than four (4) Business Days’ irrevocable notice to the Co-Administrative Agent in the case of Offshore Rate Loans, and not later than 12:00 p.m. (Chicago time) on the prepayment date, in the case of Base Rate Loans, prepay Revolving Loans ratably among the Lenders in whole or in part, in minimum Dollar Equivalent amounts of $500,000 or any Dollar Equivalent multiple of $100,000 in excess thereof. Such notice of prepayment shall specify the date and amount of such prepayment and whether such prepayment is of Base Rate Loans or Offshore Rate Loans, or any combination thereof, and the Applicable Currency. Such notice shall not thereafter be revocable by the Company and the Co-Administrative Agent will promptly notify each Lender of its receipt of any such notice, and of such Lender’s Pro Rata Share of such prepayment. If such notice is given by the Company, the Company shall make such prepayment and the payment amount specified in such notice shall be due and payable on the date specified therein, together, in the case of Offshore Rate Loans, with accrued interest to each such date on the amount prepaid and any amounts required pursuant to Section 4.04.

          (b) Subject to Section 4.04, if on any Computation Date the Co-Administrative Agent shall have determined that the Dollar Equivalent Effective Amount of all Loans then outstanding exceeds the combined Commitments of the Lenders by more than $250,000 due to a change in applicable rates of exchange between Dollars and the Offshore Currency, then the Co-Administrative Agent may and at the direction of the Required Lenders shall give notice to the Company that a prepayment is required under this Section, and the Company agrees thereupon to promptly (but in no event later than three (3) Business Days following receipt of such notice) make prepayments of Loans such that, after giving effect to all such prepayments, the Effective Amount of all Loans plus the Effective Amount of L/C Obligations does not exceed the combined Commitments.

          (c) Subject to Section 4.04, if on any date the Effective Amount of all Revolving Loans and Swing Line Loans then outstanding plus the Effective Amount of all L/C Obligations exceeds the Aggregate Commitment, the Company shall immediately, and without notice or demand, prepay the outstanding principal amount of the Revolving Loans and L/C Advances by an amount equal to the applicable excess.

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     2.09 Repayment. The Company shall repay to the Lenders on the Termination Date the aggregate principal amount of Revolving Loans outstanding on such date.

     2.10 Interest. (a) Each Revolving Loan shall bear interest on the outstanding principal amount thereof from the applicable Borrowing Date at a rate per annum equal to (i) the Offshore Rate or the Base Rate, as the case may be (and subject to the Company’s right to convert to other Types of Loans under Section 2.04), plus (ii) the Applicable Margin, if any.

          (b) Interest on each Loan shall be paid in arrears on each Interest Payment Date. Interest on Base Rate Loans shall also be paid on the date of any payment (including prepayment) in full of all Loans hereunder. Interest on Offshore Rate Loans shall also be paid on the date of any prepayment of Loans under Section 2.08 (including prepayment) in full thereof. During the existence of any Event of Default, interest on all Loans shall be paid on demand of the Agent or the Co-Administrative Agent at the request or with the consent of the Required Lenders.

          (c) Notwithstanding subsection 2.10(a), while any Event of Default exists or after acceleration, at the option of the Required Lenders, the Company shall pay interest (after as well as before entry of judgment thereon to the extent permitted by law) on the amount of all outstanding Obligations, at a rate per annum which is determined by adding 2% per annum to the applicable interest rate otherwise then in effect for such Loans; provided, however, that on and after the expiration of any Interest Period applicable to any Offshore Rate Loan outstanding on the date of occurrence of such Event of Default or acceleration, the principal amount of such Loan shall, during the continuation of such Event of Default or after acceleration, bear interest at a rate per annum equal to the Base Rate plus the Applicable Margin plus 2%.

          (d) Anything herein to the contrary notwithstanding, the obligations of the Company to any Lender hereunder shall be subject to the limitation that payments of interest shall not be required for any period for which interest is computed hereunder, to the extent (but only to the extent) that contracting for or receiving such payment by such Lender would be contrary to the provisions of any law applicable to such Lender limiting the highest rate of interest that may be lawfully contracted for, charged or received by such Lender, and in such event the Company shall pay such Lender interest at the highest rate permitted by applicable law.

     2.11 Fees. In addition to certain fees described in Section 3.08:

          (a) Agent’s Fees. The Company shall pay such fees to the Agent as are required by the letter agreement between the Company, the Agent and the Arranger dated February 28, 2005 (the “Agent Fee Letter”).

          (b) Co-Administrative Agent’s Fees. The Company shall pay such fees to the Agent as are required by the letter agreement between the Company, the Agent and the Arranger dated February 17, 2005 (the “Co-Administrative Agent Fee Letter”).

          (c) Non-Use Fees. The Company shall pay to the Co-Administrative Agent for the account of each Lender a non-use fee on the average daily unused portion of such Lender’s Commitment, computed on a quarterly basis in arrears on the last Business Day of each calendar quarter based upon the daily utilization for that quarter as calculated by the

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Co-Administrative Agent, equal to the Applicable Non-Use Fee Percentage. For purposes of calculating utilization under this subsection, the Commitments shall be deemed used to the extent of the Effective Amount of Revolving Loans then outstanding, plus the Effective Amount of L/C Obligations then outstanding and shall not be deemed used by a Lender’s Pro Rata Share of Swing Line Loans. Such non-use fee shall accrue from the Restatement Date to the Termination Date and shall be due and payable quarterly in arrears on the last Business Day of each calendar quarter commencing on June 30, 2005 through the Termination Date, with the final payment to be made on the Termination Date; provided that, in connection with any reduction or termination of Commitments under Section 2.07 or an increase of Commitments under Section 2.17, the accrued non-use fee calculated for the period ending on such date shall also be paid on the date of such reduction or termination, with the following quarterly payment being calculated on the basis of the period from such reduction or termination date to such quarterly payment date. The non-use fees provided in this subsection shall accrue at all times after the above-mentioned commencement date, including at any time during which one or more conditions in Article V are not met.

     2.12 Computation of Fees and Interest. (a) All computations of interest for Base Rate Loans when the Base Rate is determined by LaSalle’s “reference rate” shall be made on the basis of a year of 365 or 366 days, as the case may be, and actual days elapsed. All other computations of fees and interest shall be made on the basis of a 360-day year and actual days elapsed (which results in more interest being paid than if computed on the basis of a 365/366-day year); provided, that computations of interest for Alternative Currency Loans will be made on the basis of a year of 365 or 366 days, as the case may be, and actual days elapsed if that is the market standard for the applicable Offshore Currency. Interest and fees shall accrue during each period during which interest or such fees are computed from the first day thereof to the last day thereof.

          (b) For purposes of determining utilization of each Lender’s Commitment in order to calculate the non-use fee due under subsection 2.11(b) and whether or not the utilization-based additions to the Base Rate and the Applicable Margin are applicable, the amount of any outstanding Revolving Loan which is an Offshore Currency Loan on any date shall be determined based upon the Dollar Equivalent amount as of the most recent Computation Date with respect to such Offshore Currency Loan.

          (c) Each determination of an interest rate or a Dollar Equivalent amount by the Co-Administrative Agent shall be conclusive and binding on the Company and the Lenders in the absence of manifest error. The Co-Administrative Agent will, at the request of the Company or any Lender, deliver to the Company or the Lender, as the case may be, a statement showing the quotations used by the Co-Administrative Agent in determining any interest rate or Dollar Equivalent amount.

     2.13 Payments by the Company.

          (a) All payments to be made by the Company shall be made without set-off, recoupment or counterclaim. Except as otherwise expressly provided herein, all payments by the Company shall be made to the Co-Administrative Agent for the account of the Lenders at the Co-Administrative Agent’s Payment Office, and, with respect to principal of, interest on, and

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any other amounts relating to, any Offshore Currency Loan, shall be made in the Offshore Currency in which such Loan is denominated or payable, and, with respect to all other amounts payable hereunder, shall be made in Dollars. Such payments shall be made in Same Day Funds, and (i) in the case of Offshore Currency payments, no later than such time on the dates specified herein as may be determined by the Co-Administrative Agent to be necessary for such payment to be credited on such date in accordance with normal banking procedures in the place of payment, and (ii) in the case of any Dollar payments, no later than 11:00 a.m. (Chicago time) on the date specified herein. The Co-Administrative Agent will promptly distribute to each Lender its Pro Rata Share (or other applicable share as expressly provided herein) of such principal, interest, fees or other amounts, in like funds as received. Any payment which is received by the Co-Administrative Agent later than 11:00 a.m. (Chicago time) or later than the time specified by the Co-Administrative Agent as provided in clause (i) above (in the case of Offshore Currency payments), shall be deemed to have been received on the following Business Day and any applicable interest or fee shall continue to accrue.

          (b) Subject to the provisions set forth in the definition of “Interest Period” herein, whenever any payment is due on a day other than a Business Day, such payment shall be made on the following Business Day, and such extension of time shall in such case be included in the computation of interest or fees, as the case may be.

          (c) Unless the Co-Administrative Agent receives notice from the Company prior to the date on which any payment is due to the Lenders that the Company will not make such payment in full as and when required, the Agent may assume that the Company has made such payment in full to the Co-Administrative Agent on such date in Same Day Funds and the Co-Administrative Agent may (but shall not be so required), in reliance upon such assumption, distribute to each Lender on such due date an amount equal to the amount then due such Lender. If and to the extent the Company has not made such payment in full to the Co-Administrative Agent, each Lender shall repay to the Co-Administrative Agent on demand such amount distributed to such Lender, together with interest thereon at the Federal Funds Rate or, in the case of a payment in an Offshore Currency, the Overnight Rate, for each day from the date such amount is distributed to such Lender until the date repaid.

     2.14 Payments by the Lenders to the Co-Administrative Agent. (a) Unless the Co-Administrative Agent receives notice from a Lender on or prior to the Restatement Date or, with respect to any Borrowing after the Restatement Date, at least one Business Day prior to the date of such Borrowing, that such Lender will not make available as and when required hereunder to the Co-Administrative Agent for the account of the Company the amount of that Lender’s Pro Rata Share of the Borrowing, the Co-Administrative Agent may assume that each Lender has made such amount available to the Co-Administrative Agent in Same Day Funds on the Borrowing Date and the Agent may (but shall not be so required), in reliance upon such assumption, make available to the Company on such date a corresponding amount. If and to the extent any Lender shall not have made its full amount available to the Co-Administrative Agent in Same Day Funds and the Co-Administrative Agent in such circumstances has made available to the Company such amount, that Lender shall on the Business Day following such Borrowing Date make such amount available to the Co-Administrative Agent, together with interest at the Federal Funds Rate, or, in the case of a payment in an Offshore Currency, the Overnight Rate, for each day during such period. A notice of the Co-Administrative Agent submitted to any

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Lender with respect to amounts owing under this subsection (a) shall be conclusive absent manifest error. If such amount is so made available, such payment to the Co-Administrative Agent shall constitute such Lender’s Loan on the date of Borrowing for all purposes of this Agreement. If such amount is not made available to the Co-Administrative Agent on the Business Day following the Borrowing Date, the Co-Administrative Agent will notify the Company of such failure to fund and, upon demand by the Co-Administrative Agent, the Company shall pay such amount to the Co-Administrative Agent for the Co-Administrative Agent’s account, together with interest thereon for each day elapsed since the date of such Borrowing, at a rate per annum equal to the interest rate applicable at the time to the Loans comprising such Borrowing.

          (b) The failure of any Lender to make any Loan on any Borrowing Date shall not relieve any other Lender of any obligation hereunder to make a Loan on such Borrowing Date, but no Lender shall be responsible for the failure of any other Lender to make the Loan to be made by such other Lender on any Borrowing Date.

     2.15 Sharing of Payments, Etc. If, other than as expressly provided elsewhere herein, any Lender shall obtain on account of the Loans made by it any payment (whether voluntary, involuntary, through the exercise of any right of set-off, or otherwise) in excess of its ratable share (or other share contemplated hereunder), such Lender shall immediately (a) notify the Co-Administrative Agent of such fact, and (b) purchase from the other Lenders such participations in the Loans made by them as shall be necessary to cause such purchasing Lender to share the excess payment pro rata 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 therefor, together with an amount equal to such paying Lender’s ratable share (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. The Company agrees that any Lender so purchasing a participation from another Lender may, to the fullest extent permitted by law, exercise all its rights of payment (including the right of set-off, but subject to Section 11.10) with respect to such participation as fully as if such Lender were the direct creditor of the Company in the amount of such participation. The Co-Administrative Agent will keep records (which shall be conclusive and binding in the absence of manifest error) of participations purchased under this Section and will in each case notify the Lenders following any such purchases or repayments.

     2.16 Subsidiary Guaranty. All obligations of the Company under this Agreement and all other Loan Documents shall be unconditionally guaranteed by the Guarantors pursuant to the Subsidiary Guaranty.

     2.17 Increase in Commitments; Additional Lenders. (a) The Company may, upon at least 10 Business Days’ notice to the Agent and the Co-Administrative (of which notice the Co-Administrative Agent shall promptly provide a copy to the Lenders); provided that the Company has not previously terminated all or any portion of the Commitment pursuant to Section 2.07 hereof; and provided, further, that before and after giving effect to the Commitment Increase (as defined below) no Event of Default has occurred and is continuing or would result therefrom,

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propose to increase the Commitment by an amount not to exceed $100,000,000 over the Aggregate Commitment on the Restatement Date (the amount of any such increase, the “Commitment Increase”), to be allocated among the Lenders in a manner mutually acceptable to the Company and the Agent. Each requested Commitment Increase shall be in an aggregate minimum amount of $25,000,000 or any multiple of $1,000,000 in excess thereof, and the Company shall not be permitted to make more than one (1) request for a Commitment Increase during any fiscal year of the Company.

          (b) The Company, with the consent of the Agent and the Co-Administrative Agent (which shall not be unreasonably withheld or delayed prior to the occurrence and continuance of an Event of Default or an incipient Default), but without the consent of any other Lenders, may designate one or more other banks or other financial institutions (which may be, but need not be, one or more of the existing Lenders; and for greater certainty, no existing Lender shall have any obligation to increase its applicable Commitment) which at the time agree in the case of any such bank that is an existing Lender to increase its applicable Commitment and, in the case of any other such bank or financial institution (each an “Additional Lender”), to become a party to this Agreement. The sum of the increases in the Commitment of the existing Lenders pursuant to this subsection (b) plus the Commitment of the Additional Lenders shall not in the aggregate exceed the amount of the Commitment Increase.

          (c) An increase in the Commitment pursuant to this Section 2.17 shall become effective upon the receipt by the Agent and the Co-Administrative Agent of an agreement in form and substance satisfactory to the Agent and the Co-Administrative Agent signed by the Company, by each Additional Lender and by each other Lender whose Commitment is to be increased, setting forth the new Commitment of such Lenders and setting forth the agreement of each Additional Lender to become a party to this Agreement and to be bound by all the terms and provisions hereof, together with such evidence of appropriate corporate authorization on the part of the Company with respect to the Commitment Increase as the Agent or the Co-Administrative Agent may reasonably request, if any.

          (d) Upon the effectiveness of a Commitment Increase pursuant to this Section 2.17, the Commitment amounts set forth on Schedule 2.01 shall be deemed amended, reflecting the increases of the Commitment of existing Lenders and the addition of the new Commitment of the Additional Lenders, if any. Concurrently with the effectiveness of such increase and any additional extension of credit in connection therewith, each Lender shall fund its Pro Rata Share of the outstanding Revolving Loans, Swing Loans and overdue L/C Obligations relating to L/C Advances, if any, to the Co-Administrative Agent, so that after giving effect thereto each Lender, including the Additional Lenders, if any, holds its Pro Rata Share of the outstanding Revolving Loans, Swing Loans and L/C Obligations relating to each Loan to which it is a party, and the Company shall pay to each Lender all amounts due under Article IV hereof as a result of any prepayment of any outstanding Offshore Rate Loans resulting from any Lender’s funding of Loans previously funded by other Lenders.

ARTICLE III

THE LETTERS OF CREDIT

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     3.01 The Letter of Credit Subfacility. (a) On the terms and conditions set forth herein (i) the Issuer agrees, (A) from time to time on any Business Day, during the period from the Restatement Date to the day which is five days prior to the Termination Date, to issue Letters of Credit for the account of the Company and to amend or renew Letters of Credit previously issued by it, in accordance with subsections 3.02(c) and 3.02(d), and (B) to honor drafts under the Letters of Credit; and (ii) the Lenders severally agree to participate in Letters of Credit Issued for the account of the Company; provided, that the Issuer shall not be obligated to Issue, and no Lender shall be obligated to participate in, any Letter of Credit if as of the date of Issuance of such Letter of Credit (the “Issuance Date”) (1) the Effective Amount of all L/C Obligations plus the Effective Amount of all Revolving Loans and of all Swing Line Loans exceeds the Aggregate Commitment, (2) the participation of any Lender in the Effective Amount of all L/C Obligations plus the Effective Amount of the Revolving Loans of such Lender and such Lender’s Pro Rata Share of any outstanding Swing Line Loans exceeds such Lender’s Commitment, or (3) the Effective Amount of L/C Obligations exceeds the L/C Commitment. Within the foregoing limits, and subject to the other terms and conditions hereof, the Company’s ability to obtain Letters of Credit shall be fully revolving, and, accordingly, the Company may, during the foregoing period, obtain Letters of Credit to replace Letters of Credit which have expired or which have been drawn upon and reimbursed.

          (b) The Issuer is under no obligation to, and shall not, Issue any Letter of Credit if:

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

          (ii) the Issuer has received written notice from any Revolving Lender, the Agent, the Co-Administrative Agent or the Company, on or prior to the Business Day prior to the requested date of Issuance of such Letter of Credit, that one or more of the applicable conditions contained in Article V is not then satisfied;

          (iii) the expiry date of any requested Letter of Credit is (A) more than 360 days after the date of Issuance, unless the Required Lenders have approved such expiry date in writing, or (B) after the date which is five days prior to the Termination Date, unless all of the Lenders have approved such expiry date in writing;

          (iv) the expiry date of any requested Letter of Credit is prior to the maturity date of any financial obligation to be supported by the requested Letter of Credit;

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          (v) any requested Letter of Credit does not provide for drafts, or is not otherwise in form and substance acceptable to the Issuer, or the Issuance of a Letter of Credit shall violate any applicable policies of the Issuer; or

          (vi) such Letter of Credit is in a face amount less than $25,000, unless such amount is approved by the Agent and the Issuer or is to be denominated in a currency other than Dollars.

     3.02 Issuance, Amendment and Renewal of Letters of Credit. (a) Each Letter of Credit shall be issued upon the irrevocable written request of the Company received by the Issuer (with a copy sent by the Company to the Co-Administrative Agent) at least three days (or such shorter time as the Issuer may agree in a particular instance in its sole discretion) prior to the proposed date of issuance. Each such request for issuance of a Letter of Credit shall be by facsimile, confirmed immediately in an original writing, in the form of an L/C Application (or such other form as shall be acceptable to the Issuer), and shall specify in form and detail satisfactory to the Issuer: (i) the proposed date of issuance of the Letter of Credit (which shall be a Business Day); (ii) the face amount of the Letter of Credit; (iii) the expiry date of the Letter of Credit; (iv) the name and address of the beneficiary thereof; (v) the documents to be presented by the beneficiary of the Letter of Credit in case of any drawing thereunder; (vi) the full text of any certificate to be presented by the beneficiary in case of any drawing thereunder; and (vii) such other matters as the Issuer may require.

          (b) At least two Business Days prior to the Issuance of any Letter of Credit (or such shorter time as the Agent may agree in a particular instance in its sole discretion), the Issuer will confirm with the Agent (by telephone or in writing) that the Agent has received a copy of the L/C Application or L/C Amendment Application from the Company and, if not, the Issuer will provide the Agent with a copy thereof. Unless the Issuer has received notice on or before the Business Day immediately preceding the date the Issuer is to issue a requested Letter of Credit from the Agent (A) directing the Issuer not to issue such Letter of Credit because such issuance is not then permitted under subsection 3.01(a) as a result of the limitations set forth in clauses (1) through (3) thereof or subsection 3.01(b)(ii); or (B) that one or more conditions specified in Article V are not then satisfied; then, subject to the terms and conditions hereof, the Issuer shall, on the requested date, Issue a Letter of Credit for the account of the Company in accordance with the Issuer’s usual and customary business practices.

          (c) From time to time while a Letter of Credit is outstanding and prior to the Termination Date, the Issuer will, upon the written request of the Company received by the Issuer (with a copy sent by the Company to the Co-Administrative Agent) at least three days (or such shorter time as the Issuer may agree in a particular instance in its sole discretion) prior to the proposed date of amendment, amend any Letter of Credit issued by it. Each such request for amendment of a Letter of Credit shall be made by facsimile, confirmed immediately in an original writing, made in the form of an L/C Amendment Application and shall specify in form and detail satisfactory to the Issuer: (i) the Letter of Credit to be amended; (ii) the proposed date of amendment of the Letter of Credit (which shall be a Business Day); (iii) the nature of the proposed amendment; and (iv) such other matters as the Issuer may require. The Issuer shall be under no obligation to amend any Letter of Credit if: (A) the Issuer would have no obligation at such time to issue such Letter of Credit in its amended form under the terms of this Agreement;

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or (B) the beneficiary of any such letter of Credit does not accept the proposed amendment to the Letter of Credit. The Co-Administrative Agent will promptly notify the Lenders of the receipt by it of any L/C Application or L/C Amendment Application.

          (d) The Issuer and the Lenders agree that, while a Letter of Credit is outstanding and prior to the Termination Date, at the option of the Company and upon the written request of the Company received by the Issuer (with a copy sent by the Company to the Co-Administrative Agent) at least five days (or such shorter time as the Issuer may agree in a particular instance in its sole discretion) prior to the proposed date of notification of renewal, the Issuer shall be entitled to authorize the automatic renewal of any Letter of Credit issued by it. Each such request for renewal of a Letter of Credit shall be made by facsimile, confirmed immediately in an original writing, in the form of an L/C Amendment Application, and shall specify in form and detail satisfactory to the Issuer: (i) the Letter of Credit to be renewed; (ii) the proposed date of notification of renewal of the Letter of Credit (which shall be a Business Day); (iii) the revised expiry date of the Letter of Credit; and (iv) such other matters as the Issuer may require. The Issuer shall be under no obligation so to renew any Letter of Credit if: (A) the Issuer would have no obligation at such time to issue or amend such Letter of Credit in its renewed form under the terms of this Agreement; or (B) the beneficiary of any such Letter of Credit does not accept the proposed renewal of the Letter of Credit. If any outstanding Letter of Credit shall provide that it shall be automatically renewed unless the beneficiary thereof receives notice from the Issuer that such Letter of Credit shall not be renewed, and if at the time of renewal the Issuer would be entitled to authorize the automatic renewal of such Letter of Credit in accordance with this subsection 3.02(d) upon the request of the Company but the Issuer shall not have received any L/C Amendment Application from the Company with respect to such renewal or other written direction by the Company with respect thereto, the Issuer shall nonetheless be permitted to allow such Letter of Credit to renew, and the Company and the Lenders hereby authorize such renewal, and, accordingly, the Issuer shall be deemed to have received an L/C Amendment Application from the Company requesting such renewal.

          (d) The Issuer may, at its election (or as required by the Agent or the Co-Administrative Agent at the direction of the Required Lenders), deliver any notices of termination or other communications to any Letter of Credit beneficiary or transferee, and take any other action as necessary or appropriate, at any time and from time to time, in order to cause the expiry date of such Letter of Credit to be a date not later than the date which is five days prior to the Termination Date.

          (e) This Agreement shall control in the event of any conflict with any L/C-Related Document (other than any Letter of Credit).

          (f) The Issuer will also deliver to the Co-Administrative Agent, concurrently or promptly following its delivery of a Letter of Credit, or amendment to or renewal of a Letter of Credit, to an advising bank or a beneficiary, a true and complete copy of each such Letter of Credit or amendment to or renewal of a Letter of Credit.

     3.03 Risk Participations, Drawings and Reimbursements. (a) Immediately upon the Issuance of each Letter of Credit, each Lender shall be deemed to, and hereby irrevocably and unconditionally agrees to, purchase from the Issuer a participation in such Letter of Credit and

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each drawing thereunder in an amount equal to the product of (i) the Pro Rata Share of such Lender, times (ii) the maximum amount available to be drawn under such Letter of Credit and the amount of such drawing, respectively. For purposes of Section 2.01, each Issuance of a Letter of Credit shall be deemed to utilize the Commitment of each Lender by an amount equal to the amount of such participation.

          (b) In the event of any request for a drawing under a Letter of Credit by the beneficiary or transferee thereof, the Issuer will promptly notify the Company. The Company shall reimburse the Issuer prior to 11:00 a.m. (Chicago time), on each date that any amount is paid by the Issuer under any Letter of Credit (each such date, an “Honor Date”), in an amount equal to the amount so paid by the Issuer. In the event the Company fails to reimburse the Issuer the full amount of any drawing under any Letter of Credit by 11:00 a.m. (Chicago time) on the Honor Date, the Issuer will promptly notify the Co-Administrative Agent and the Co-Administrative Agent will promptly notify each Lender thereof, and the Company shall be deemed to have requested that Base Rate Loans in an amount equal to such unreimbursed amount be made by the Revolving Lenders to be disbursed on the Honor Date under such Letter of Credit, subject to the amount of the unutilized portion of the Aggregate Commitment and subject to the conditions set forth in Section 5.02. Any notice given by the Issuer or the Co-Administrative Agent pursuant to this subsection 3.03(b) may be oral if immediately confirmed in writing (including by facsimile); provided that the lack of such an immediate confirmation shall not affect the conclusiveness or binding effect of such notice.

          (c) Each Revolving Lender shall upon any notice pursuant to subsection 3.03(b) make available to the Co-Administrative Agent for the account of the relevant Issuer an amount in Dollars and in immediately available funds equal to its Pro Rata Share of the amount of the drawing, whereupon the participating Lenders shall (subject to subsection 3.03(d)) each be deemed to have made a Revolving Loan consisting of a Base Rate Loan to the Company in that amount. If any Lender so notified fails to make available to the Co-Administrative Agent for the account of the Issuer the amount of such Lender’s Pro Rata Share of the amount of the drawing by no later than 12:00 noon (Chicago time) on the Honor Date, then interest shall accrue on such Lender’s obligation to make such payment, from the Honor Date to the date such Lender makes such payment, at a rate per annum equal to the Federal Funds Rate in effect from time to time during such period. The Co-Administrative Agent will promptly give notice of the occurrence of the Honor Date, but failure of the Co-Administrative Agent to give any such notice on the Honor Date or in sufficient time to enable any Lender to effect such payment on such date shall not relieve such Lender from its obligations under this Section 3.03 once notice has been provided.

          (d) With respect to any unreimbursed drawing that is not converted into Revolving Loans consisting of Base Rate Loans to the Company in whole or in part, because of the Company’s failure to satisfy the conditions set forth in Section 5.02 or for any other reason, the Company shall be deemed to have incurred from the Issuer an L/C Borrowing in the Dollar Equivalent of the amount of such drawing, which L/C Borrowing shall be due and payable on demand (together with interest) and shall bear interest at a rate per annum equal to the Base Rate plus 2.0% per annum, and each Lender’s payment to the Issuer pursuant to subsection 3.03(c) shall be deemed payment in respect of its participation in such L/C Borrowing and shall constitute an L/C Advance from such Lender in satisfaction of its participation obligation under this Section 3.03.

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          (e) Each Lender’s obligation in accordance with this Agreement to make the Revolving Loans or L/C Advances, as contemplated by this Section 3.03, as a result of a drawing under a Letter of Credit, shall be absolute and unconditional and without recourse to the Issuer and shall not be affected by any circumstance, including (i) any set-off, counterclaim, recoupment, defense or other right which such Lender may have against the Issuer, the Company or any other Person for any reason whatsoever; (ii) the occurrence or continuance of a Default, an Event of Default or a Material Adverse Effect; or (iii) any other circumstance, happening or event whatsoever, whether or not similar to any of the foregoing; provided, however, that each Lender’s obligation to make Revolving Loans under this Section 3.03 is subject to the conditions set forth in Section 5.02.

     3.04 Repayment of Participations. (a) Upon (and only upon) receipt by the Co-Administrative Agent for the account of the Issuer of immediately available funds from the Company (i) in reimbursement of any payment made by the Issuer under the Letter of Credit with respect to which any Lender has paid the Co-Administrative Agent for the account of the Issuer for such Lender’s participation in the Letter of Credit pursuant to Section 3.03 or (ii) in payment of interest thereon, the Co-Administrative Agent will promptly pay to each Lender, in the same funds as those received by the Co-Administrative Agent for the account of the Issuer, the amount of such Lender’s Pro Rata Share of such funds, and the Issuer shall receive the amount of the Pro Rata Share of such funds of any Lender that did not so pay the Co-Administrative Agent for the account of the Issuer.

          (b) If the Agent, the Co-Administrative Agent or the Issuer is required at any time to return to the Company, or to a trustee, receiver, liquidator, custodian, or any official in any Insolvency Proceeding, any portion of the payments made by the Company to the Co-Administrative Agent for the account of the Issuer pursuant to subsection 3.04(a) in reimbursement of a payment made under the Letter of Credit or interest or fee thereon, each Lender shall, on demand of the Co-Administrative Agent, forthwith return to the Co-Administrative Agent or the Issuer the amount of its Pro Rata Share of any amounts so returned by the Co-Administrative Agent or the Issuer plus interest thereon from the date such demand is made to the date such amounts are returned by such Lender to the Agent, the Co-Administrative Agent or the Issuer, at a rate per annum equal to the Federal Funds Rate in effect from time to time.

     3.05 Role of the Issuer. (a) Each Lender and the Company agree that, in paying any drawing under a Letter of Credit, the Issuer shall not have any responsibility to obtain any document (other than any documents expressly required by the Letter of Credit) or to ascertain or inquire as to the validity or accuracy of any such document or the authority of the Person executing or delivering any such document.

          (b) No Agent-Related Person nor any of the respective correspondents, participants or assignees of the Issuer shall be liable to any Lender for: (i) any action taken or omitted in connection herewith at the request or with the approval of the Lenders or the Required Lenders, as applicable; (ii) any action taken or omitted in the absence of gross negligence or willful misconduct; or (iii) the due execution, effectiveness, validity or enforceability of any L/C-Related Document.

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          (c) The Company hereby assumes all risks of the acts or omissions of any beneficiary or transferee with respect to its use of any Letter of Credit; provided, however, that this assumption is not intended to, and shall not, preclude the Company’s pursuing such rights and remedies as it may have against the beneficiary or transferee at law or under any other agreement. No Agent-Related Person, nor any of the respective correspondents, participants or assignees of the Issuer, shall be liable or responsible for any of the matters described in clauses (i) through (vii) of Section 3.06; provided, however, anything in such clauses to the contrary notwithstanding, that the Company may have a claim against the Issuer, and the Issuer may be liable to the Company, to the extent, but only to the extent, of any direct, as opposed to consequential or exemplary, damages suffered by the Company which the Company proves were caused by the Issuer’s willful misconduct or gross negligence or the Issuer’s willful failure to pay under any Letter of Credit after the presentation to it by the beneficiary of a document strictly complying with the terms and conditions of a Letter of Credit. In furtherance and not in limitation of the foregoing: (i) the Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary; and (ii) the Issuer shall not be responsible for the validity or sufficiency of any instrument transferring or assigning or purporting to transfer or assign a Letter of Credit or the rights or benefits thereunder or proceeds thereof, in whole or in part, which may prove to be invalid or ineffective for any reason.

     3.06 Obligations Absolute. The obligations of the Company under this Agreement and any L/C-Related Document to reimburse the Issuer for a drawing under a Letter of Credit, and to repay any L/C Borrowing and any drawing under a Letter of Credit converted into Revolving Loans, shall be unconditional and irrevocable, and shall be paid strictly in accordance with the terms of this Agreement and each such other L/C-Related Document under all circumstances, including the following:

                    (i) any lack of validity or enforceability of this Agreement or any L/C-Related Document;

                    (ii) any change in the time, manner or place of payment of, or in any other term of, all or any of the obligations of the Company in respect of any Letter of Credit or any other amendment or waiver of or any consent to departure from all or any of the L/C-Related Documents;

                    (iii) the existence of any claim, recoupment, set-off, defense or other right that the Company may have at any time against any beneficiary or any transferee of any Letter of Credit (or any Person for whom any such beneficiary or any such transferee may be acting), the Issuer or any other Person, whether in connection with this Agreement, the transactions contemplated hereby or by the L/C-Related Documents or any unrelated transaction;

                    (iv) any draft, demand, certificate or other document presented under any Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect; or any loss or delay in the transmission or otherwise of any document required in order to make a drawing under any Letter of Credit;

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                    (v) any payment by the Issuer under any Letter of Credit against presentation of a document that does not strictly comply with the terms of any Letter of Credit; or any payment made by the Issuer under any Letter of Credit to any Person purporting to be a trustee in bankruptcy, debtor-in-possession, assignee for the benefit of creditors, liquidator, receiver or other representative of or successor to any beneficiary or any transferee of any Letter of Credit, including any arising in connection with any Insolvency Proceeding;

                    (vi) any exchange, release or non-perfection of any collateral, or any release or amendment or waiver of or consent to departure from any other guarantee, for all or any of the obligations of the Company in respect of any Letter of Credit; or

                    (vii) any other circumstance or happening whatsoever, whether or not similar to any of the foregoing, including any other circumstance that might otherwise constitute a defense available to, or a discharge of, the Company or a guarantor.

     3.07 Cash Collateral Pledge. Upon (i) the request of the Agent or the Required Lenders, (A) if any Event of Default has occurred and is continuing, or (B) if, as of the Termination Date, any Letters of Credit may for any reason remain outstanding and partially or wholly undrawn, or (ii) the termination of the Aggregate Commitment, then the Company shall immediately Cash Collateralize the L/C Obligations in an amount equal to such L/C Obligations.

     3.08 Letter of Credit Fees. (a) The Company shall pay to the Co-Administrative Agent for the account of each of the Lenders a letter of credit fee with respect to the Letters of Credit equal to the Applicable Margin for Offshore Rate Loans times the average daily maximum amount available to be drawn of the outstanding Letters of Credit, computed on a quarterly basis in arrears on the last Business Day of each calendar quarter based upon Letters of Credit outstanding for that quarter as calculated by the Co-Administrative Agent. Such letter of credit fees shall be due and payable quarterly in arrears on the last Business Day of each calendar quarter during which Letters of Credit are outstanding, commencing on the first such quarterly date to occur after the Restatement Date, through the Termination Date (or such later date upon which the outstanding Letters of Credit shall expire), with the final payment to be made on the Termination Date (or such later expiration date).

          (b) The Company shall pay to the Issuer, for its sole account, a letter of credit fronting fee for each Letter of Credit Issued by the Issuer equal to .125% per annum of the face amount (or increased or decreased face amount, as the case may be) of such Letter of Credit. Such Letter of Credit fronting fee shall be due and payable quarterly in arrears on the last Business Day of each calendar quarter during which such Letter of Credit is outstanding, commencing on the first such quarterly date to occur after such Letter of Credit is Issued, through the Termination Date (or such later date upon which such Letter of Credit shall expire), with the final payment to be made on the Termination Date (or such later expiration date).

          (c) The Company shall pay to the Issuer, for its sole account, from time to time on demand the normal issuance, presentation, amendment and other processing fees, and other standard costs and charges, of such Issuer relating to letters of credit as from time to time in effect.

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     3.09 Uniform Customs and Practice. The Uniform Customs and Practice for Documentary Credits as published by the International Chamber of Commerce most recently at the time of issuance of any Letter of Credit shall (unless otherwise expressly provided in the Letters of Credit) apply to the Letters of Credit.

ARTICLE IV

TAXES, YIELD PROTECTION AND ILLEGALITY

     4.01 Taxes. (a) Any and all payments by the Company to each Lender, the Co-Administrative Agent or the Agent under this Agreement and any other Loan Document shall be made free and clear of, and without deduction or withholding for, any Taxes. In addition, the Company shall pay all Further Taxes and Other Taxes.

          (b) If the Company shall be required by law to deduct or withhold any Taxes, Other Taxes or Further Taxes from or in respect of any sum payable hereunder to any Lender, the Co-Administrative Agent or the Agent, then:

                    (i) the sum payable shall be increased as necessary so that, after making all required deductions and withholdings (including deductions and withholdings applicable to additional sums payable under this Section), such Lender, the Co-Administrative Agent or the Agent, as the case may be, receives and retains an amount equal to the sum it would have received and retained had no such deductions or withholdings been made;

                    (ii) the Company shall make such deductions and withholdings;

                    (iii) the Company shall pay the full amount deducted or withheld to the relevant taxing authority or other authority in accordance with applicable law; and

                    (iv) the Company shall also pay to each Lender, the Co-Administrative Agent or the Agent for the account of such Lender, at the time interest is paid, Further Taxes in the amount that the respective Lender specifies as necessary to preserve the after-tax yield the Lender would have received if such Taxes, Other Taxes or Further Taxes had not been imposed.

          (c) The Company agrees to indemnify and hold harmless each Lender, the Co-Administrative Agent and the Agent for the full amount of (i) Taxes, (ii) Other Taxes, and (iii) Further Taxes in the amount that the respective Lender specifies as necessary to preserve the after-tax yield the Lender would have received if such Taxes, Other Taxes or Further Taxes had not been imposed, and any liability (including penalties, interest, additions to tax and expenses) arising therefrom or with respect thereto, whether or not such Taxes, Other Taxes or Further Taxes were correctly or legally asserted. Payment under this indemnification shall be made within 30 days after the date the Lender, the Co-Administrative Agent or the Agent makes written demand therefor.

          (d) Within 30 days after the date of any payment by the Company of Taxes, Other Taxes or Further Taxes, the Company shall furnish to each Lender, the Co-Administrative

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Agent or the Agent the original or a certified copy of a receipt evidencing payment thereof, or other evidence of payment satisfactory to such Lender, the Co-Administrative Agent or the Agent.

          (e) If the Company is required to pay any amount to any Lender, the Co-Administrative Agent or the Agent pursuant to subsection (b) or (c) of this Section, then such Lender shall use reasonable efforts (consistent with legal and regulatory restrictions) to change the jurisdiction of its Lending Office so as to eliminate any such additional payment by the Company which may thereafter accrue, if such change in the sole judgment of such Lender is not otherwise disadvantageous to such Lender.

     4.02 Illegality. (a) If any Lender determines that the introduction of any Requirement of Law, or any change in any Requirement of Law, or in the interpretation or administration of any Requirement of Law, has made it unlawful, or that any central bank or other Governmental Authority has asserted that it is unlawful, for any Lender or its applicable Lending Office to make Offshore Rate Loans, then, on notice thereof by the Lender to the Company through the Co-Administrative Agent, any obligation of that Lender to make Offshore Rate Loans shall be suspended until the Lender notifies the Co-Administrative Agent and the Company that the circumstances giving rise to such determination no longer exist.

          (b) If a Lender determines that it is unlawful to maintain any Offshore Rate Loan, the Company shall, upon its receipt of notice of such fact and demand from such Lender (with a copy to the Co-Administrative Agent), prepay in full such Offshore Rate Loans of that Lender then outstanding, together with interest accrued thereon and amounts required under Section 4.04, either on the last day of the Interest Period thereof, if the Lender may lawfully continue to maintain such Offshore Rate Loans to such day, or immediately, if the Lender may not lawfully continue to maintain such Offshore Rate Loan. If the Company is required to so prepay any Offshore Rate Loan, then concurrently with such prepayment, the Company shall borrow from the affected Lender, in the amount of such repayment, a Base Rate Loan.

          (c) If the obligation of any Lender to make or maintain Offshore Rate Loans has been so terminated or suspended, the Company may elect, by giving notice to the Lender through the Co-Administrative Agent that all Loans which would otherwise be made by the Lender as Offshore Rate Loans shall be instead Base Rate Loans.

          (d) Before giving any notice to the Co-Administrative Agent under this Section, the affected Lender shall designate a different Lending Office with respect to its Offshore Rate Loans if such designation will avoid the need for giving such notice or making such demand and will not, in the judgment of the Lender, be illegal or otherwise disadvantageous to the Lender.

     4.03 Increased Costs and Reduction of Return. (a) If any Lender determines that, due to either (i) the introduction of or any change in or in the interpretation of any law or regulation after the Restatement Date or (ii) the compliance by that Lender with any guideline or request from any central bank or other Governmental Authority (whether or not having the force of law), there shall be any increase in the cost to such Lender of agreeing to make or making, funding or maintaining any Offshore Rate Loans or participating in Letters of Credit, or, in the case of the

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Issuer, any increase in the cost to the Issuer of agreeing to issue, issuing or maintaining any Letter of Credit or of agreeing to make or making, funding or maintaining any unpaid drawing under any Letter of Credit, then the Company shall be liable for, and shall from time to time, upon demand (with a copy of such demand to be sent to the Co-Administrative Agent), pay to the Co-Administrative Agent for the account of such Lender, additional amounts as are sufficient to compensate such Lender for such increased costs.

          (b) If any Lender shall have determined that (i) the introduction of any Capital Adequacy Regulation after the Restatement Date, (ii) any change in any Capital Adequacy Regulation after the Restatement Date, (iii) any change in the interpretation or administration of any Capital Adequacy Regulation after the Restatement Date by any central bank or other Governmental Authority charged with the interpretation or administration thereof, or (iv) compliance by the Lender (or its Lending Office) or any corporation controlling the Lender with any Capital Adequacy Regulation, affects or would affect the amount of capital required or expected to be maintained by the Lender or any corporation controlling the Lender and (taking into consideration such Lender’s or such corporation’s policies with respect to capital adequacy and such Lender’s desired return on capital) determines that the amount of such capital is increased as a consequence of its Commitment, loans, credits or obligations under this Agreement, then, upon demand of such Lender to the Company through the Co-Administrative Agent, the Company shall pay to the Lender, from time to time as specified by the Lender, additional amounts sufficient to compensate the Lender for such increase.

     4.04 Funding Losses. The Company shall reimburse each Lender and hold each Lender harmless from any loss or expense which the Lender may sustain or incur as a consequence of:

          (a) the failure of the Company to make on a timely basis any payment of principal of any Offshore Rate Loan;

          (b) the failure of the Company to borrow, continue or convert a Loan after the Company has given (or is deemed to have given) a Notice of Borrowing, a Notice of Conversion/ Continuation or similar notice;

          (c) the failure of the Company to make any prepayment in accordance with any notice delivered under Section 2.08;

          (d) the prepayment or other payment (including after acceleration thereof) of an Offshore Rate Loan on a day that is not the last day of the relevant Interest Period (including, without limitation, in connection with the syndication of the Commitments);

          (e) the automatic conversion under Section 2.04 of any Offshore Rate Loan to a Base Rate Loan on a day that is not the last day of the relevant Interest Period;

including any such loss or expense arising from the liquidation or reemployment of funds obtained by it to maintain its Offshore Rate Loans or from fees payable to terminate the deposits from which such funds were obtained. For purposes of calculating amounts payable by the Company to the Lenders under this Section and under subsection 4.03(a), each Offshore Rate Loan made by a Lender (and each related reserve, special deposit or similar requirement) shall be

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conclusively deemed to have been funded at the LIBOR used in determining the Offshore Rate for such Offshore Rate Loan by a matching deposit or other borrowing in the interbank eurodollar market for a comparable amount and for a comparable period, whether or not such Offshore Rate Loan is in fact so funded.

     4.05 Inability to Determine Rates. If the Co-Administrative Agent determines that for any reason adequate and reasonable means do not exist for determining the Offshore Rate for any requested Interest Period with respect to a proposed Offshore Rate Loan, or that the Offshore Rate applicable pursuant to subsection 2.11(a) for any requested Interest Period with respect to a proposed Offshore Rate Loan does not adequately and fairly reflect the cost to the Lenders of funding such Loan, the Co-Administrative Agent will promptly so notify the Company and each Lender. Thereafter, the obligation of the Lenders to make or maintain Offshore Rate Loans hereunder shall be suspended until the Co-Administrative Agent revokes such notice in writing. Upon receipt of such notice, the Company may revoke any Notice of Borrowing or Notice of Conversion/Continuation then submitted by it. If the Company does not revoke such Notice, the Lenders shall make, convert or continue the Loans, as proposed by the Company, in the amount specified in the applicable notice submitted by the Company, but such Loans shall be made, converted or continued as Base Rate Loans instead of Offshore Rate Loans, as the case may be.

     4.06 Reserves on Offshore Rate Loans. The Company shall pay to each Lender, as long as such Lender shall be required under regulations of the FRB to maintain reserves with respect to liabilities or assets consisting of or including Eurocurrency funds or deposits (currently known as “Eurocurrency liabilities”), additional costs on the unpaid principal amount of each Offshore Rate Loan to the Company equal to the actual costs of such reserves allocated to such Loan by the Lender (as determined by the Lender in good faith, which determination shall be conclusive), payable on each date on which interest is payable on such Loan, provided the Company shall have received at least 15 days’ prior written notice (with a copy to the Co-Administrative Agent) of such additional interest from the Lender. If a Lender fails to give notice 15 days prior to the relevant Interest Payment Date, such additional interest shall be payable 15 days from receipt of such notice.

     4.07 Certificates of Lenders. Any Lender claiming reimbursement or compensation under this Article IV shall deliver to the Company (with a copy to the Co-Administrative Agent) a certificate setting forth in reasonable detail the amount payable to the Lender hereunder and such certificate shall be conclusive and binding on the Company in the absence of manifest error.

     4.08 Substitution of Banks. Upon the receipt by the Company from any Lender (an “Affected Lender”) of a claim for compensation under Section 4.03 or Section 4.06, of notice that it cannot make Offshore Rate Loans under Section 4.02, or of a claim for Taxes or Further Taxes under Section 4.01, then the Agent, at the Company’s direction, shall: (i) request the Affected Lender to use good faith efforts to obtain a replacement bank or financial institution satisfactory to the Company to acquire and assume all or a ratable part of all of such Affected Lender’s Loans and Commitments at the face amount thereof (a “Replacement Lender”); (ii) request one more of the other Lenders to acquire and assume all or part of such Affected Lender’s Loans and Commitments; or (iii) designate a Replacement Lender. Any such designation of a Replacement Lender under clause (i) or (iii) shall be subject to the prior written consent of the Agent (which consent shall not be unreasonably withheld). Any transfer of Loans

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and Commitments shall be accompanied by the payment of any amounts due to the Affected Lender under Sections 4.01, 4.03, 4.04 (calculated as if the assigned Loans were prepaid on the date of assignment) and 4.06 and shall be made in accordance with Section 11.08; provided, that the processing fee referenced in Section 11.08(a) shall not be required to be paid.

     4.09 Survival. The agreements and obligations of the Company in this Article IV shall survive the payment of all other Obligations, and the Company will have no obligation to pay any amount hereunder unless a demand is made within 180 days after the date upon which the Agent’s, the Co-Administrative Agent’s or applicable Lender’s right to reimbursement arises.

ARTICLE V

CONDITIONS PRECEDENT

     5.01 Conditions to Effectiveness of Restatement. The effectiveness of this Agreement is subject to the condition that the Agent shall have received all of the following, in form and substance satisfactory to the Agent and each Lender, and in sufficient copies for each Lender:

          (a) Credit Agreement. This Agreement executed by each party thereto;

          (b) Resolutions; Incumbency.

                    (i) Copies of the resolutions of the board of directors of the Company and each Subsidiary party to a Loan Document authorizing the transactions contemplated hereby, certified as of the Restatement Date by the Secretary or an Assistant Secretary of the Company or such Subsidiary, as applicable; and

                    (ii) A certificate of the Secretary or Assistant Secretary of the Company and each Subsidiary party to a Loan Document certifying the names and true signatures of the officers of the Company or such Subsidiary authorized to execute, deliver and perform, as applicable, this Agreement and all other Loan Documents to be delivered by it hereunder;

          (c) Organization Documents; Good Standing. Each of the following documents:

                    (i) the articles or certificate of incorporation and the bylaws of the Company and each Subsidiary party to a Loan Document as in effect on the Restatement Date, certified as of the Restatement Date by the Secretary or Assistant Secretary of the Company; and

                    (ii) a good standing certificate or certificate of status for the Company and each Subsidiary party to a Loan Document from the Secretary of State (or similar, applicable Governmental Authority) of its state of incorporation and each other state where it is qualified to do business and the failure to be so qualified could reasonably be expected to have a material adverse effect on the business or financial condition of the Company or such Subsidiary;

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          (d) Legal Opinion. An opinion of Eric Bakken, Esq., counsel to the Company and the Guarantors, addressed to the Agent and the Lenders.

          (e) Payment of Fees. Evidence of payment by the Company of all accrued and unpaid fees, costs and expenses to the extent then due and payable on the Restatement Date, together with Attorney Costs of Bank of America to the extent invoiced prior to or on the Restatement Date, plus such additional amounts of Attorney Costs as shall constitute Bank of America’s reasonable estimate of Attorney Costs incurred or to be incurred by it through the closing proceedings (provided that such estimate shall not thereafter preclude final settling of accounts between the Company and Bank of America); including any such costs, fees and expenses arising under or referenced in Sections 2.11 and 11.04;

          (f) Certificate. A certificate signed by a Responsible Officer, dated as of the Restatement Date, stating that:

                    (i) the representations and warranties contained in Article VI are true and correct on and as of such date, as though made on and as of such date;

                    (ii) no Default or Event of Default exists or would result from the Credit Extension; and

                    (iii) there has not occurred since December 31, 2004 any event or circumstance that has resulted or could reasonably be expected to result in a Material Adverse Effect;

          (g) Subsidiary Guaranty. A Subsidiary Guaranty executed by each Guarantor;

          (h) Repayment of Prior Indebtedness. All outstanding Indebtedness of the Company or any Subsidiary not specified on Schedule 8.05 or otherwise permitted by Section 8.05 shall have been paid in full and all Liens securing such Indebtedness shall have been terminated;

          (i) Issuance of Senior Notes. Concurrently with the Restatement Date, the purchasers under the Note Agreement set forth in clause (c) of the definition thereof shall have purchased and the Company shall have issued not less than $200,000,000 of its Senior Notes, on terms and conditions satisfactory to the Agent, the Co-Administrative Agent and the Required Lenders; and

          (j) Other Documents. Such other approvals, opinions, documents or materials as the Agent, the Co-Administrative Agent or any Lender may request.

     5.02 Conditions to All Credit Extensions. The obligation of each Lender to make any Revolving Loan to be made by it (including its initial Revolving Loan) and the obligation of the Issuer to Issue any Letter of Credit (including the initial Letter of Credit) is subject to the satisfaction of the following conditions precedent on the relevant Borrowing Date or Issuance Date:

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          (a) Notice, Application. The Agent shall have received a Notice of Borrowing or in the case of any Issuance of any Letter of Credit, the Issuer and the Agent shall have received an L/C Application or L/C Amendment Application, as required under Section 3.02;

          (b) Continuation of Representations and Warranties. The representations and warranties in Article VI shall be true and correct on and as of such Borrowing Date or Issuance Date with the same effect as if made on and as of such Borrowing Date or Issuance Date (except to the extent such representations and warranties expressly refer to an earlier date, in which case they shall be true and correct as of such earlier date); and

          (c) No Existing Default. No Default or Event of Default shall exist or shall result from such Borrowing or Issuance.

Each Notice of Borrowing, L/C Application or L/C Amendment Application submitted by the Company hereunder shall constitute a representation and warranty by the Company hereunder, as of the date of each such notice and as of each Borrowing Date or Issuance Date, as applicable, that the conditions in this Section 5.02 are satisfied.

ARTICLE VI

REPRESENTATIONS AND WARRANTIES

     The Company represents and warrants to the Agent, the Co-Administrative Agent and each Lender that:

     6.01 Corporate Existence and Power. The Company and each of its Subsidiaries:

          (a) is an entity duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation or formation;

          (b) has the power and authority and all governmental licenses, authorizations, consents and approvals to own its assets, to carry on its business and to execute, deliver, and perform its obligations under the Loan Documents to which it is a party;

          (c) is duly qualified as a foreign corporation and is licensed and in good standing under the laws of each jurisdiction where its ownership, lease or operation of property or the conduct of its business requires such qualification or license; and

          (d) is in compliance with all Requirements of Law; except, in each case referred to in clause (c) or clause (d), to the extent that the failure to do so could not reasonably be expected to have a Material Adverse Effect.

     6.02 Corporate Authorization; No Contravention. The execution, delivery and performance by the Company and its Subsidiaries of this Agreement and each other Loan Document to which such Person is party, have been duly authorized by all necessary corporate action, and do not and will not:

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          (a) contravene the terms of any of that Person’s Organization Documents;

          (b) conflict with or result in any breach or contravention of, or the creation of any Lien under, any document evidencing any Contractual Obligation to which such Person is a party or any order, injunction, writ or decree of any Governmental Authority to which such Person or its property is subject; or

          (c) violate any Requirement of Law.

     6.03 Governmental Authorization. No approval, consent, exemption, authorization, or other action by, or notice to, or filing with, any Governmental Authority is necessary or required in connection with the execution, delivery or performance by, or enforcement against, the Company or any of its Subsidiaries of the Agreement or any other Loan Document.

     6.04 Binding Effect. This Agreement and each other Loan Document to which the Company or any of its Subsidiaries is a party constitute the legal, valid and binding obligations of the Company and any of its Subsidiaries to the extent it is a party thereto, enforceable against such Person in accordance with their respective terms, except as enforceability may be limited by applicable bankruptcy, insolvency, or similar laws affecting the enforcement of creditors’ rights generally or by equitable principles relating to enforceability.

     6.05 Litigation. There are no actions, suits, investigations, proceedings, claims or disputes pending, or to the best knowledge of the Company, threatened or contemplated, at law, in equity, in arbitration or before any Governmental Authority, against the Company, or its Subsidiaries or any of their respective properties:

          (a) which purport to affect or pertain to this Agreement or any other Loan Document, or any of the transactions contemplated hereby or thereby; or

          (b) as to which there exists a substantial likelihood of an adverse determination, which determination could reasonably be expected to have a Material Adverse Effect. No injunction, writ, temporary restraining order or any order of any nature has been issued by any court or other Governmental Authority purporting to enjoin or restrain the execution, delivery or performance of this Agreement or any other Loan Document, or directing that the transactions provided for herein or therein not be consummated as herein or therein provided.

     6.06 No Default. No Default or Event of Default exists or would result from the incurring of any Obligations by the Company. As of the Restatement Date, neither the Company nor any Subsidiary is in default under or with respect to any Contractual Obligation in any respect which, individually or together with all such defaults, could reasonably be expected to have a Material Adverse Effect, or that would, if such default had occurred after the Restatement Date, create an Event of Default under subsection 9.01(e).

     6.07 ERISA Compliance.

          (a) Each Plan is in compliance in all material respects with the applicable provisions of ERISA, the Code and other federal or state law. Each Plan which is intended to

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qualify under Section 401(a) of the Code has received a favorable determination letter from the IRS and to the best knowledge of the Company, nothing has occurred which would cause the loss of such qualification. The Company and each ERISA Affiliate has made all required contributions to any Plan subject to Section 412 of the Code, and no application for a funding waiver or an extension of any amortization period pursuant to Section 412 of the Code has been made with respect to any Plan.

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

          (c) (i) No ERISA Event has occurred or is reasonably expected to occur; (ii) no Pension Plan has any Unfunded Pension Liability; (iii) neither the Company nor any ERISA Affiliate has incurred, or reasonably expects to incur, any liability to the PBGC under Title IV of ERISA with respect to any Pension Plan (other than premiums due and not delinquent under Section 4007 of ERISA); (iv) neither the Company nor any ERISA Affiliate has incurred, or reasonably expects to incur, any liability (and no event has occurred which, with the giving of notice under Section 4219 of ERISA, would result in such liability) under Section 4201 or 4243 of ERISA with respect to a Multiemployer Plan; and (v) neither the Company nor any ERISA Affiliate has engaged in a transaction that could be subject to Section 4069 or 4212(c) of ERISA.

     6.08 Use of Proceeds; Margin Regulations. The proceeds of the Loans are to be used solely for the purposes set forth in and permitted by Section 7.12, to the extent not prohibited by Section 8.07. Neither the Company nor any Subsidiary is generally engaged in the business of purchasing or selling Margin Stock or extending credit for the purpose of purchasing or carrying Margin Stock. No part of the proceeds of any Loan will be used to purchase or carry any margin stock (as defined in Regulation U of the FRB), directly or indirectly, or to extend credit for the purpose of purchasing or carrying any such margin stock for the purpose of reducing or retiring any indebtedness which was originally incurred to purchase or carry any margin security or for any other purpose which might 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 FRB.

     6.09 Title to Properties. The Company and each Subsidiary have good record and marketable title in fee simple to, or valid leasehold interests in, all real property necessary or used in the ordinary conduct of their respective businesses, except for such defects in title as could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. As of the Restatement Date, the property of the Company and its Subsidiaries is subject to no Liens, other than Permitted Liens.

     6.10 Taxes. The Company and its Subsidiaries have filed all Federal and other material tax returns and reports required to be filed, and have paid all Federal and other material taxes, assessments, fees and other governmental charges levied or imposed upon them or their properties, income or assets otherwise due and payable, except those which are being contested

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in good faith by appropriate proceedings and for which adequate reserves have been provided in accordance with GAAP. There is no proposed tax assessment against the Company or any Subsidiary that would, if made, have a Material Adverse Effect.

     6.11 Financial Condition. The audited consolidated financial statements of the Company and its Subsidiaries dated June 30, 2004, and the related consolidated statements of income or operations, shareholders’ equity and cash flows for the fiscal year ended on that date:

     (x) were prepared in accordance with GAAP consistently applied throughout the period covered thereby;

     (y) fairly present the financial condition of the Company and its Subsidiaries as of the date thereof and results of operations for the period covered thereby; and

     (z) except as specifically disclosed in Schedule 6.11, show all material indebtedness and other liabilities, direct or contingent, of the Company and its Subsidiaries as of the date thereof.

          (a) Since December 31, 2004 there has been no Material Adverse Effect.

     6.12 Environmental Matters. Except as specifically disclosed in Schedule 6.12:

          (a) The on-going operations of the Company and each of its Subsidiaries comply in all respects with all Environmental Laws, except such non-compliance which would not (if enforced in accordance with applicable law) result in liability in excess of $1,500,000 in the aggregate (exclusive of amounts payable under insurance policies and indemnity agreements which the Company or such Subsidiary reasonably expects to receive).

          (b) The Company and each of its Subsidiaries have obtained all licenses, permits, authorizations and registrations required under any Environmental Law (“Environmental Permits”) and necessary for their respective ordinary course operations, all such Environmental Permits are in good standing, and the Company and each of its Subsidiaries are in compliance with all material terms and conditions of such Environmental Permits.

          (c) None of the Company, any of its Subsidiaries or any of their respective present Property or operations, is subject to any outstanding written order from or agreement with any Governmental Authority, nor subject to (i) any judicial or docketed administrative proceeding, respecting any Environmental Law, Environmental Claim or Hazardous Material or (ii) to the extent that it could reasonably be expected to have a Material Adverse Effect, any claim, proceeding or written notice from any Person regarding any Environmental Law, Environmental Claim or Hazardous Material.

          (d) There are no Hazardous Materials or other conditions or circumstances existing with respect to any Property of the Company or any Subsidiary, or arising from operations prior to the Restatement Date, of the Company or any of its Subsidiaries that would reasonably be expected to give rise to Environmental Claims with a potential liability of the Company and its Subsidiaries in excess of $1,500,000 in the aggregate for all such conditions,

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circumstances and Properties. In addition, (i) neither the Company nor any Subsidiary has any underground storage tanks (x) that are not properly registered or permitted under applicable Environmental Laws, or (y) that are leaking or disposing of Hazardous Materials off-site, and (ii) the Company and its Subsidiaries have met all material notification requirements under applicable Environmental Laws.

     6.13 Labor Relations. There are no strikes, lockouts or other labor disputes against the Company or any of its Subsidiaries, or, to the best of the Company’s knowledge, threatened against or affecting the Company or any of its Subsidiaries, and no significant unfair labor practice complaint is pending against the Company or any of its Subsidiaries or, to the best knowledge of the Company, threatened against any of them before any Governmental Authority.

     6.14 Regulated Entities. None of the Company, any Person controlling the Company, or any Subsidiary, is an “Investment Company” within the meaning of the Investment Company Act of 1940. Neither the Company nor any Subsidiary is subject to regulation under the Public Utility Holding Company Act of 1935, the Federal Power Act, the Interstate Commerce Act, any state public utilities code, or any other Federal or state statute or regulation limiting its ability to incur Indebtedness.

     6.15 No Burdensome Restrictions. Neither the Company nor any Subsidiary is a party to or bound by any Contractual Obligation, or subject to any restriction in any Organization Document, or any Requirement of Law, which could reasonably be expected to have a Material Adverse Effect.

     6.16 Copyrights, Patents, Trademarks and Licenses, etc. The Company and its Subsidiaries own or are licensed or otherwise have the right to use all of the patents, trademarks, service marks, trade names, copyrights, contractual franchises, authorizations and other rights that are reasonably necessary for the operation of their respective businesses, without conflict with the rights of any other Person. To the best knowledge of the Company, no slogan or other advertising device, product, process, method, substance, part or other material now employed, or now contemplated to be employed, by the Company or any Subsidiary infringes upon any rights held by any other Person. No claim or litigation regarding any of the foregoing is pending or threatened, and no patent, invention, device, application, principle or any statute, law, rule, regulation, standard or code is pending or, to the knowledge of the Company, proposed, which, in either case, could reasonably be expected to have a Material Adverse Effect.

     6.17 Subsidiaries. As of the Restatement Date, the Company has no Subsidiaries other than those specifically disclosed in part (a) of Schedule 6.17 hereto and has no equity investments in any other corporation or entity other than those specifically disclosed in part (b) of Schedule 6.17.

     6.18 Insurance. The properties of the Company and its Subsidiaries are insured with financially sound and reputable insurance companies not Affiliates of the Company in such amounts, with such deductibles and covering such risks as are customarily carried by companies engaged in similar businesses and are similarly situated.

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     6.19 Swap Obligations. Neither the Company nor any of its Subsidiaries has incurred any outstanding obligations under any Swap Contracts, other than Permitted Swap Obligations. The Company has undertaken its own independent assessment of its consolidated assets, liabilities and commitments and has considered appropriate means of mitigating and managing risks associated with such matters and has not relied on any swap counterparty or any Affiliate of any swap counterparty in determining whether to enter into any Swap Contract.

     6.20 Solvency. The Company and each of its Subsidiaries are Solvent.

     6.21 Full Disclosure. None of the representations or warranties made by the Company or any Subsidiary in the Loan Documents as of the date such representations and warranties are made or deemed made, and none of the statements contained in any exhibit, report, statement or certificate furnished by or on behalf of the Company or any Subsidiary in connection with the Loan Documents (including the offering and disclosure materials delivered by or on behalf of the Company or its Subsidiaries to the Lenders prior to the Restatement Date), contains any untrue statement of a material fact or omits any material fact required to be stated therein or necessary to make the statements made therein, in light of the circumstances under which they are made, not misleading as of the time when made or delivered.

ARTICLE VII

AFFIRMATIVE COVENANTS

     So long as any Lender shall have any Commitment hereunder, or any Loan or other Obligation shall remain unpaid or unsatisfied, or any Letter of Credit shall remain outstanding, unless the Required Lenders waive compliance in writing:

     7.01 Financial Statements. The Company shall deliver to the Co-Administrative Agent, in form and detail satisfactory to the Agent, the Co-Administrative and the Required Lenders, with sufficient copies to be provided by the Co-Administrative Agent to each Lender:

          (a) as soon as available, but not later than the earlier of (i) fifteen days after the filing thereof with the SEC and (ii) 105 days after the end of each fiscal year (commencing with the fiscal year ended June 30, 2005), a copy of the audited consolidated balance sheet of the Company and its Subsidiaries as at the end of such year and the related consolidated statements of income, shareholders’ equity and cash flows for such year, setting forth in each case in comparative form the figures for the previous fiscal year, and accompanied by the opinion of PriceWaterhouseCoopers LLP or another nationally-recognized independent public accounting firm (“Independent Auditor”) which report shall state that such consolidated financial statements present fairly the financial position for the periods indicated in conformity with GAAP applied on a basis consistent with prior years. Such opinion shall not be qualified or limited because of a restricted or limited examination by the Independent Auditor of any material portion of the Company’s or any Subsidiary’s records or because of a “going concern” exception; and

          (b) as soon as available, but not later than the earlier of (i) fifteen days after the filing thereof with the SEC and (ii) 45 days after the end of each of the first three fiscal quarters of each fiscal year (commencing with the fiscal quarter ended March 31, 2005), a copy

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of the unaudited consolidated and consolidating balance sheet of the Company and its Subsidiaries as of the end of such fiscal quarter and the related consolidated and consolidating statements of income, shareholders’ equity and cash flows for the period commencing on the first day and ending on the last day of such fiscal quarter, and certified by a Responsible Officer as fairly presenting, in accordance with GAAP (subject to ordinary, good faith year-end audit adjustments), the financial position and the results of operations of the Company and the Subsidiaries.

     7.02 Certificates; Other Information. The Company shall furnish to the Agent and the Co-Administrative Agent, with sufficient copies to be provided by the Co-Administrative Agent to each Lender:

          (a) [intentionally omitted];

          (b) concurrently with the delivery of the financial statements referred to in subsections 7.01(a) and (b), a Compliance Certificate executed by a Responsible Officer;

          (c) concurrently with the delivery of the financial statements referred to in subsection 7.01(a), (i) a consolidating balance sheet and income statement for such year (which need not be audited) and setting forth in comparative form the figures for the previous fiscal year, and (ii) a budget for the next succeeding fiscal year;

          (d) promptly, copies of all financial statements and reports that the Company sends to its shareholders, and copies of all financial statements and regular, periodic or special reports (including Forms 10K, 10Q and 8K) that the Company or any Subsidiary may make to, or file with, the SEC; and

          (e) promptly, such additional information regarding the business, financial or corporate affairs of the Company or any Subsidiary as the Agent or the Co-Administrative Agent, at the request of any Lender, may from time to time reasonably request.

     The Company hereby acknowledges that (a) the Agent and the Co-Administrative Agent will make available to the Lenders and the Issuer materials and/or information provided by or on behalf of Company hereunder (collectively, “Company Materials”) by posting Company Materials on IntraLinks or another similar electronic system (the “Platform”) and (b) certain of the Lenders may be “public-side” Lenders (i.e., Lenders that do not wish to receive material non-public information with respect to Company or its securities) (each, a “Public Lender”). The Company hereby agrees that (w) all Company Materials that are to be made available to Public Lenders shall be clearly and conspicuously marked “PUBLIC” which, at a minimum, shall mean that the word “PUBLIC” shall appear prominently on the first page thereof; (x) by marking Company Materials “PUBLIC,” the Company shall be deemed to have authorized the Agent, the Co-administrative Agent, the Issuer and the Lenders to treat such Company Materials as either publicly available information or not material information (although it may be sensitive and proprietary) with respect to the Company or its securities for purposes of United States Federal and state securities laws; (y) all Company Materials marked “PUBLIC” are permitted to be made available through a portion of the Platform designated “Public Investor;” and (z) the Agent and the Co-Administrative Agent shall be entitled to treat any Company Materials that are not

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marked “PUBLIC” as being suitable only for posting on a portion of the Platform not designated “Public Investor.

     7.03 Notices. The Company shall promptly notify the Agent, the Co-Administrative Agent and each Lender:

          (a) of the occurrence of any Default or Event of Default, and of the occurrence or existence of any event or circumstance that foreseeably will become a Default or Event of Default;

          (b) of any matter that has resulted or could reasonably be expected to result in a Material Adverse Effect, including, to the extent so applicable, (i) any breach or non-performance of, or any default under, a Contractual Obligation of the Company or any Subsidiary; (ii) any dispute, litigation, investigation, proceeding or suspension between the Company or any Subsidiary and any Governmental Authority; (iii) the commencement of, or any material development in, any litigation or proceeding affecting the Company or any Subsidiary, including pursuant to any applicable Environmental Laws; or (iv) any other Environmental Claims;

          (c) of the occurrence of any of the following events affecting the Company or any ERISA Affiliate (but in no event more than 10 days after such event), and deliver to the Agent and each Lender a copy of any notice with respect to such event that is filed with a Governmental Authority and any notice delivered by a Governmental Authority to the Company or any ERISA Affiliate with respect to such event:

          (i) an ERISA Event;

          (ii) a material increase in the Unfunded Pension Liability of any Pension Plan;

          (iii) the adoption of, or the commencement of contributions to, any Plan subject to Section 412 of the Code by the Company or any ERISA Affiliate; or

          (iv) the adoption of any amendment to a Plan subject to Section 412 of the Code, if such amendment results in a material increase in contributions or Unfunded Pension Liability;

          (d) of any material change in accounting policies or financial reporting practices by the Company or any of its consolidated Subsidiaries;

          (e) upon, but in no event later than 15 days after, any officer of the Company or any Subsidiary becoming aware of (i) any and all enforcement, investigation, cleanup, removal or other governmental or regulatory actions instituted, completed or threatened against the Company or any Subsidiary or any of their respective properties pursuant to any applicable Environmental Laws which could reasonably be expected to have a Material Adverse Effect, (ii) all other material Environmental Claims, and (iii) any environmental or similar condition on any real property adjoining or in the vicinity of the property of the Company or any Subsidiary that could reasonably be anticipated to cause such property of the Company or such Subsidiary

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or any part thereof to be subject to any material restrictions on the ownership, occupancy, transferability or use of such property under any Environmental Laws; and

          (f) upon the reasonable request from time to time of the Agent, the Swap Termination Values, together with a description of the method by which such values were determined, relating to any then-outstanding Swap Contracts to which the Company or any of its Subsidiaries is party.

     Each notice under this Section shall be accompanied by a written statement by a Responsible Officer setting forth details of the occurrence referred to therein, and stating what action the Company or any affected Subsidiary proposes to take with respect thereto and at what time. Each notice under subsection 7.03(a) shall describe with particularity any and all clauses or provisions of this Agreement or other Loan Document that have been (or foreseeably will be) breached or violated.

     7.04 Preservation of Corporate Existence, Etc. The Company shall, and shall cause each Subsidiary to:

          (a) preserve and maintain in full force and effect its corporate existence and good standing under the laws of its state or jurisdiction of incorporation;

          (b) preserve and maintain in full force and effect all governmental rights, privileges, qualifications, permits, licenses and franchises necessary or desirable in the normal conduct of its business except in connection with transactions permitted by Section 8.03 and sales of assets permitted by Section 8.02;

          (c) use reasonable efforts, in the ordinary course of business, to preserve its business organization and goodwill; and

          (d) preserve or renew all of its registered patents, trademarks, trade names and service marks, the non-preservation of which could reasonably be expected to have a Material Adverse Effect.

The Company shall cause each Subsidiary which is a Wholly-Owned Subsidiary as of the Restatement Date to continue to exist as a Wholly-Owned Subsidiary so long as it shall be a Subsidiary.

     7.05 Maintenance of Property. The Company shall maintain, and shall cause each Subsidiary to maintain, and preserve all its property which is used or useful in its business in good working order and condition, ordinary wear and tear excepted, and make all necessary repairs thereto and renewals and replacements thereof.

     7.06 Insurance. The Company shall maintain, and shall cause each Subsidiary to maintain, with financially sound and reputable independent 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, of such types and in such amounts as are customarily carried under similar circumstances by such other Persons, including workers’ compensation insurance, public liability and property and casualty insurance.

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     7.07 Payment of Obligations. The Company shall, and shall cause each Subsidiary to, pay and discharge as the same shall become due and payable, all their respective obligations and liabilities, including:

          (a) all tax liabilities, assessments and governmental charges or levies upon it or its properties or assets, unless the same are being contested in good faith by appropriate proceedings and adequate reserves in accordance with GAAP are being maintained by the Company or such Subsidiary; and

          (b) all material lawful claims which, if unpaid, would by law become a Lien upon its property in violation of Section 8.01.

     7.08 Compliance with Laws. The Company shall comply, and shall cause each Subsidiary to comply, in all material respects with all Requirements of Law of any Governmental Authority having jurisdiction over it or its business (including the Federal Fair Labor Standards Act), except such as may be contested in good faith or as to which a bona fide dispute may exist. In addition, the Company shall (a) ensure, and cause each Subsidiary to ensure, that no Person who owns a controlling interest in or otherwise controls the Company or any Subsidiary is or shall be listed on the Specially Designated Nationals and Blocked Person List or other similar lists maintained by the Office of Foreign Assets Control (“OFAC”), the Department of the Treasury, or included in any Executive Orders, (b) not use or permit the use of the proceeds of the Loans to violate any of the foreign asset control regulations of OFAC or any enabling statute or Executive Order relating thereto, and (c) comply, and cause each Subsidiary to comply, with all applicable Bank Secrecy Act (“BSA”) laws and regulations, as amended.

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

     7.10 Inspection of Property and Books and Records. The Company shall maintain and shall cause each Subsidiary to maintain proper books of record and account, in which full, true and correct entries in conformity with GAAP consistently applied shall be made of all financial transactions and matters involving the assets and business of the Company and such Subsidiary. The Company shall permit, and shall cause each Subsidiary to permit, representatives and independent contractors of the Agent or any Lender to visit and inspect any of their respective properties, to examine their respective corporate, financial and operating records, and make copies thereof or abstracts therefrom, and to discuss their respective affairs, finances and accounts with their respective directors, officers, and independent public accountants, all at the expense of the Company and at such reasonable times during normal business hours and as often as may be reasonably desired, upon reasonable advance notice to the Company; provided, however, when an Event of Default exists the Agent or any Lender may do any of the foregoing at the expense of the Company at any time during normal business hours and without advance notice; provided, further, that neither the Agent nor any Lender shall conduct any environmental testing of any owned or leased facility of the Company or any Subsidiary without the prior written consent of the Company, which shall not unreasonably be withheld.

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     7.11 Environmental Laws. (a) The Company shall, and shall cause each Subsidiary to, conduct its operations and keep and maintain its property in compliance with all Environmental Laws, the violation of which could reasonably be expected to result in liability to the Company and its Subsidiaries in excess of $5,000,000 in the aggregate (net of any payments under insurance policies or indemnity agreements which the Company or such Subsidiary reasonably expects to receive).

          (b) Upon the written request of the Agent or any Lender, the Company shall submit and cause each of its Subsidiaries to submit, to the Agent with sufficient copies for each Lender, at the Company’s sole cost and expense, at reasonable intervals, a report providing an update of the status of any environmental, health or safety compliance, hazard or liability issue identified in any notice or report required pursuant to subsection 7.03(e), that could, individually or in the aggregate, result in liability in excess of $5,000,000 (net of any payments under insurance policies or indemnity agreements which the Company or such Subsidiary reasonably expects to receive).

     7.12 Use of Proceeds. The Company shall use the proceeds of the Loans (a) to finance Permitted Acquisitions and to pay certain fees and expenses related thereto, (b) for working capital, capital expenditures, stock repurchases and dividends and other general corporate purposes not in contravention of any Requirement of Law or of any Loan Document, and (c) to refinance existing Indebtedness.

     7.13 Further Assurances. (a) The Company shall ensure that all written information, exhibits and reports furnished to the Agent or the Lenders do not and will not contain any untrue statement of a material fact and do not and will not omit to state any material fact or any fact necessary to make the statements contained therein not misleading in light of the circumstances in which made, and will promptly disclose to the Agent and the Lenders and correct any defect or error that may be discovered therein or in any Loan Document or in the execution, acknowledgment or recordation thereof.

          (b) Promptly upon request by the Agent or the Required Lenders, the Company shall (and shall cause any of its Subsidiaries to) do, execute, acknowledge, deliver, record, re-record, file, re-file, register and re-register, any and all such further acts, certificates, assurances and other instruments the Agent or such Lenders, as the case may be, may reasonably require from time to time in order (i) to carry out more effectively the purposes of this Agreement or any other Loan Document, and (ii) to better assure, convey, grant, assign, transfer, preserve, protect and confirm to the Agent and Lenders the rights granted or now or hereafter intended to be granted to the Lenders under any Loan Document or under any other document executed in connection therewith.

     7.14 Additional Guaranties. Effective upon any Person becoming a Domestic Subsidiary (other than any Domestic Subsidiary with total (gross) revenues of less than 5% of the total (gross) revenues of the Company and its Subsidiaries) such Person shall join as a guarantor under the Subsidiary Guaranty pursuant to an amendment thereto in form and substance acceptable to the Agent; provided, that any Domestic Subsidiary which does not become a party to the Subsidiary Guaranty because it does not satisfy the requirement above shall execute the Subsidiary Guaranty if it subsequently has sufficient revenues to satisfy such

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requirement; provided, further, that if all Domestic Subsidiaries which are not party to the Subsidiary Guaranty have total (gross) revenues of 10% or more of the total (gross) revenues of the Company and its Subsidiaries, then such Domestic Subsidiaries shall promptly execute the Subsidiary Guaranty so that, upon such execution, such 10% threshold is no longer exceeded. The Company shall promptly notify the Agent at any time at which, in accordance with this Section 7.14, any Subsidiary shall be required to join as a guarantor under the Subsidiary Guaranty.

ARTICLE VIII

NEGATIVE COVENANTS

     So long as any Lender shall have any Commitment hereunder, or any Loan or other Obligation shall remain unpaid or unsatisfied, or any Letter of Credit shall remain outstanding, unless the Required Lenders waive compliance in writing:

     8.01 Limitation on Liens. The Company shall not, and shall not suffer or permit any Subsidiary to, directly or indirectly, make, create, incur, assume or suffer to exist any Lien upon or with respect to any part of its property, whether now owned or hereafter acquired, other than the following (“Permitted Liens”):

          (a) any Lien existing on property of the Company or any Subsidiary on the Restatement Date and set forth in Schedule 8.01 securing Indebtedness outstanding on such date;

          (b) any Lien created under any Loan Document;

          (c) Liens for taxes, fees, assessments or other governmental charges which are not delinquent or remain payable without penalty, or to the extent that non-payment thereof is permitted by Section 7.07, provided that no notice of lien has been filed or recorded under the Code;

          (d) carriers’, warehousemen’s, mechanics’, landlords’, materialmen’s, repairmen’s or other similar Liens arising in the ordinary course of business which are not delinquent or remain payable without penalty or which are being contested in good faith and by appropriate proceedings, which proceedings have the effect of preventing the forfeiture or sale of the property subject thereto;

          (e) Liens (other than any Lien imposed by ERISA) consisting of pledges or deposits required in the ordinary course of business in connection with workers’ compensation, unemployment insurance and other social security legislation;

          (f) Liens on the property of the Company or its Subsidiaries securing (i) the non-delinquent performance of bids, trade contracts (other than for borrowed money), leases, statutory obligations, (ii) Contingent Obligations in connection with performance bonds, surety bonds and appeal bonds, and (iii) other non-delinquent obligations of a like nature, in each case,

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incurred in the ordinary course of business; provided that all such Liens in the aggregate could not reasonably be expected to cause a Material Adverse Effect;

          (g) easements, rights-of-way, restrictions and other similar encumbrances incurred in the ordinary course of business which, in the aggregate, are not substantial in amount, and which do not in any case materially detract from the value of the property subject thereto or interfere with the ordinary conduct of the businesses of the Company and its Subsidiaries;

          (h) Liens securing obligations in respect of Capital Leases on assets subject to such leases, provided that such Capital Leases are otherwise permitted hereunder; and

          (i) other Liens securing Indebtedness which does not exceed in the aggregate at any one time outstanding five percent (5%) of Net Worth as set forth in the most recently delivered Compliance Certificate pursuant to Section 7.02(b).

     8.02 Disposition of Assets. The Company shall not, and shall not suffer or permit any Subsidiary to, directly or indirectly, (x) except for Joint Ventures, issue any equity interests of any Subsidiary to any Person which is not the Company or a Subsidiary or (y) sell, assign, lease, convey, transfer or otherwise dispose of (whether in one or a series of transactions) any property, including accounts and notes receivable, with or without recourse (each, an “Asset Disposition”), or enter into any agreement to do any of the foregoing, except:

          (a) dispositions of inventory, or used, worn-out or surplus equipment, all in the ordinary course of business;

          (b) the sale of equipment to the extent that such equipment is exchanged for credit against the purchase price of similar replacement equipment, or the proceeds of such sale are reasonably promptly applied to the purchase price of such replacement equipment;

          (c) dispositions made by the Company or any Subsidiary to any Wholly-Owned Subsidiary which is a Guarantor, or dispositions made by any Subsidiary to the Company; and

          (d) dispositions not otherwise permitted hereunder which are made for fair market value; provided, that (i) at the time of any disposition, no Event of Default shall exist or shall result from such disposition, (ii) with respect to any disposition (or series of related dispositions) for which total consideration exceeds $5,000,000, at least 75% of the aggregate sales price from such disposition(s) shall be paid in cash, and (iii) the aggregate value of all assets so sold by the Company and its Subsidiaries after the Restatement Date, together, shall not (x) represent more than 10% of the total assets of the Company and its Subsidiaries, as would be shown in the consolidated financial statements of the Company and its Subsidiaries as at the end of the fiscal quarter next preceding the date on which such determination is made, or (y) be responsible for more than 10% of the consolidated net income of the Company and its Subsidiaries for the 12-month period ending as of the end of the fiscal quarter next preceding the date of determination.

     8.03 Consolidations and Mergers. The Company shall not, and shall not suffer or permit any Subsidiary to, merge, consolidate with or into, or convey, transfer, lease or otherwise

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dispose of (whether in one transaction or in a series of transactions) all or substantially all of its assets (whether now owned or hereafter acquired) to or in favor of any Person, except:

          (a) any Subsidiary may merge with the Company, provided that (i) the Company shall be the continuing or surviving corporation, or with any one or more Subsidiaries, (ii) if any transaction shall be between a Subsidiary and a Wholly-Owned Subsidiary, the Wholly-Owned Subsidiary shall be the continuing or surviving corporation or entity, and (iii) if any transaction shall be between a Domestic Subsidiary and a Foreign Subsidiary, the Domestic Subsidiary shall be the continuing or surviving corporation or entity; and

          (b) any Subsidiary may sell all or substantially all of its assets (upon voluntary liquidation or otherwise) to the Company or another Wholly-Owned Subsidiary; and

          (c) any Subsidiary may merge or consolidate with another Person in order to effect a Permitted Acquisition; and

          (d) so long as it is the surviving entity, the Company may merge or consolidate with another Person in order to effect a Permitted Acquisition.

     8.04 Loans and Investments. The Company shall not purchase or acquire, or suffer or permit any Subsidiary to purchase or acquire, or make any commitment therefor, any capital stock, equity interest, or any obligations or other securities of, or any interest in, any Person, or make or commit to make any Acquisitions, or make or commit to make any advance, loan, extension of credit or capital contribution to or any other investment in, any Person including any Affiliate of the Company (together, “Investments”), except for:

          (a) Investments held by the Company or Subsidiary in the form of Cash Equivalents;

          (b) extensions of credit in the nature of accounts receivable or notes receivable arising from the sale or lease of goods or services in the ordinary course of business;

          (c) Investments by the Company or any Subsidiary in Wholly-Owned Subsidiaries party to the Subsidiary Guaranty or unsecured loans made by any Subsidiary to the Company;

          (d) Investments incurred in order to consummate Acquisitions otherwise permitted herein (“Permitted Acquisitions”), provided that (i) such Acquisitions are undertaken in accordance with all applicable Requirements of Law, (ii) the prior, effective written consent or approval to such Acquisition of the board of directors or equivalent governing body of the Person to be acquired (and stockholders, if necessary) is obtained, (iii) the Company provides the Co-Administrative Agent, for the benefit of the Lenders, prior to consummating any such Acquisition (or series of related Acquisitions) for which the total consideration of such proposed Acquisition or series of related Acquisitions (other than stock of the Company) exceeds $100,000,000, a Compliance Certificate executed by a Responsible Officer of the Company evidencing that, after giving effect to such Acquisition, no Default or Event of Default shall have occurred and be continuing (including, without limitation, in respect of Sections 8.14, 8.15 and 8.16 on a pro forma basis as of the last day of the preceding fiscal quarter), and (iv) the Person or

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business which is the subject of such Acquisition is in the same or similar line of business as the Company and its Subsidiaries;

          (e) (i) Investments by the Company in Joint Ventures engaged in the same line of business in which the Company and its Subsidiaries are engaged as of the Restatement Date, (ii) Investments by the Company or any Subsidiary in Wholly-Owned Foreign Subsidiaries, and (iii) other Investments (excluding Permitted Acquisitions) in addition to the foregoing Investments permitted by this Section 8.04; provided that the total amount of Investments permitted under this Section 8.04(e) do not exceed in the aggregate at any one time outstanding ten percent (10%) of Net Worth as set forth in the most recently delivered Compliance Certificate pursuant to Section 7.02(b); and

          (f) Investments of a nature not contemplated by the foregoing clauses hereof that are outstanding as of the Restatement Date and set forth in Schedule 8.04 hereto; and

          (g) Investments in the form of repurchase of the Company’s or any Subsidiary’s capital stock or Indebtedness approved by the Company’s board of directors (or the Subsidiary’s equivalent managers or directors) that would not otherwise result in a Default or an Event of Default.

          For the avoidance of doubt, contributions made by the Company or any ERISA Affiliate to any Pension Plan or other employee benefit plan (including qualified plans) of the Company or such ERISA Affiliate shall not constitute an Investment by the Company or such ERISA Affiliate under this Section 8.04.

     8.05 Limitation on Indebtedness. The Company shall not, and shall not suffer or permit any Subsidiary to, create, incur, assume, suffer to exist, or otherwise become or remain directly or indirectly liable with respect to, any Indebtedness, except:

          (a) Indebtedness incurred pursuant to this Agreement;

          (b) Indebtedness consisting of Contingent Obligations permitted pursuant to Section 8.08;

          (c) Indebtedness existing on the Restatement Date and set forth in Schedule 8.05;

          (d) Indebtedness incurred in connection with Capital Leases permitted pursuant to Section 8.01(c);

          (e) unsecured Indebtedness owed to the Company by any Subsidiary or owed by the Company or any Subsidiary to a Subsidiary so long as it is incurred in accordance with Section 8.04; and

          (f) other Indebtedness incurred by the Company or any Subsidiary from time to time; provided, that after giving effect to such increase, Section 8.14 would not be violated (as determined on a pro forma basis as of the last day of the previous fiscal quarter).

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     8.06 Transactions with Affiliates. Except for intercompany Indebtedness otherwise permitted, the Company shall not, and shall not suffer or permit any Subsidiary to, enter into any transaction with any Affiliate of the Company, except upon fair and reasonable terms no less favorable to the Company or such Subsidiary than would obtain in a comparable arm’s-length transaction with a Person not an Affiliate of the Company or such Subsidiary.

     8.07 Use of Proceeds. The Company shall not, and shall not suffer or permit any Subsidiary to, use any portion of the proceeds of any Loan or any Letter of Credit, directly or indirectly, (i) to purchase or carry Margin Stock, (ii) to repay or otherwise refinance indebtedness of the Company or others incurred to purchase or carry Margin Stock, (iii) to extend credit for the purpose of purchasing or carrying any Margin Stock, or (iv) to acquire any security in any transaction that is subject to Section 13 or 14 of the Exchange Act.

     8.08 Contingent Obligations. The Company shall not, and shall not suffer or permit any Subsidiary to, create, incur, assume or suffer to exist any Contingent Obligations except:

          (a) endorsements for collection or deposit in the ordinary course of business;

          (b) Permitted Swap Obligations and/or L/C Obligations; and

          (c) Contingent Obligations (other than L/C Obligations) of the Company and its Subsidiaries not to exceed in the aggregate at any one time outstanding seven and one half percent (7.5%) of Net Worth as set forth in the most recently delivered Compliance Certificate pursuant to Section 7.02(b).

     8.09 [INTENTIONALLY OMITTED]

     8.10 ERISA. The Company shall not, and shall not suffer or permit any of its Subsidiaries to, (i) terminate any Plan subject to Title IV of ERISA so as to result in any material (in the opinion of the Required Lenders) liability to the Company or any ERISA Affiliate, (ii) permit to exist any ERISA Event or any other event or condition, which presents the risk of a material (in the opinion of the Required Lenders) liability to any member of the Controlled Group, (iii) make a complete or partial withdrawal (within the meaning of ERISA Section 4201) from any Multiemployer Plan so as to result in any material (in the opinion of the Required Lenders) liability to the Company or any ERISA Affiliate or, (iv) enter into any new Plan or modify any existing Plan so as to increase its obligations thereunder which could result in any material (in the opinion of the Required Lenders) liability to any member of the Controlled Group.

     8.11 Change in Business. The Company shall not, and shall not suffer or permit any Subsidiary to, engage in any material line of business substantially different from those lines of business carried on by the Company and its Subsidiaries on the Restatement Date.

     8.12 Accounting Changes. The Company shall not, and shall not suffer or permit any Subsidiary to, (a) make any significant change in accounting treatment or reporting practices, except as required by GAAP, or (b) change the fiscal year of the Company or of any Subsidiary; provided, that the fiscal year of the Company and its Subsidiaries may be changed to a year ending December 31.

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     8.13 Amendments to Charter. The Company will not, nor will it permit any Subsidiary to, (a) make any amendment or modification to any terms or provisions of its Certificate or Articles of Incorporation or bylaws which is materially adverse to the Agent or the Lenders without the prior written consent of the Required Lenders or (b) issue any preferred stock.

     8.14 Leverage Ratio. The Company shall not, as of the last day of any fiscal quarter, permit its Leverage Ratio to be greater than 2.75 to 1.0.

     8.15 Fixed Charge Coverage Ratio. The Company shall not, as of the last day of any fiscal quarter, permit its ratio of (a) EBITDAR for the period of four fiscal quarters then ending to (b) Fixed Charges for such four fiscal quarter period to be less than 1.65 to 1.0.

     8.16 Minimum Net Worth. The Company shall not, as of the last day of any fiscal quarter, permit its Net Worth to be less than the sum of (a) $616,000,000, plus, (b) on a cumulative basis, twenty-five percent (25%) of the positive net income earned during each fiscal quarter commencing on or after March 31, 2005, plus, (c) on a cumulative basis, fifty percent (50%) of the net cash proceeds received from the issuance of equity securities of the Company, if any, after the Restatement Date.

     8.17 Restrictive Agreements. The Company shall not, nor shall it permit any of its Subsidiaries to, enter into any indenture, agreement, instrument or other arrangement which directly or indirectly prohibits or restrains, or has the effect of prohibiting or restraining, or imposes materially adverse conditions upon, the ability of any Subsidiary to (a) pay dividends or make other distributions (i) on its Capital Stock or (ii) with respect to any other interest or participation in, or measured by, its profits, (b) make loans or advances to the Company or any Subsidiary, (c) repay loans or advances from the Company or any Subsidiary or (d) transfer any of its properties or assets to the Company or any Subsidiary.

ARTICLE IX

EVENTS OF DEFAULT

     9.01 Event of Default. Any of the following shall constitute an “Event of Default”:

          (a) Non-Payment. The Company fails to pay, (i) when and as required to be paid herein, any amount of principal of any Loan or of any L/C Obligation, or (ii) within five (5) days after the same becomes due, any interest, fee or any other amount payable hereunder or under any other Loan Document; or

          (b) Representation or Warranty. Any representation or warranty by the Company or any Subsidiary made or deemed made herein or in any other Loan Document, or contained in any certificate, document or financial or other statement by the Company, any Subsidiary, or any Responsible Officer, furnished at any time under this Agreement, or in or under any other Loan Document, is incorrect in any material respect on or as of the date made or deemed made; or

          (c) Specific Defaults. The Company fails to perform or observe any term, covenant or agreement contained in any of Section 7.03 or in Article VIII; or

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          (d) Other Defaults. The Company or any Subsidiary party thereto fails to perform or observe any other term or covenant contained in this Agreement or any other Loan Document, and such default shall continue unremedied for a period of 30 days after the earlier of (i) the date upon which any senior officer of the Company knew or reasonably should have known of such failure or (ii) the date upon which written notice thereof is given to the Company by the Agent or any Lender; or

          (e) Cross-Default. (i) The Company or any Subsidiary (A) fails to make any payment in respect of any Indebtedness (other than Specified Acquisition Debt) or Contingent Obligation (other than in respect of Swap Contracts), having an aggregate principal amount (including undrawn committed or available amounts and including amounts owing to all creditors under any combined or syndicated credit arrangement) of more than $10,000,000 when due (whether by scheduled maturity, required prepayment, acceleration, demand, or otherwise) and such failure continues after the applicable grace or notice period, if any, specified in the relevant document on the date of such failure; or (B) fails 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 (other than Specified Acquisition Debt) or Contingent Obligation, and such failure continues after the applicable grace or notice period, if any, specified in the relevant document on the date of such failure if the effect of 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 such Indebtedness to be declared to be due and payable, or to be required to be repurchased, prior to its stated maturity, or such Contingent Obligation to become payable or cash collateral in respect thereof to be demanded; or (ii) there occurs under any Swap Contract an Early Termination Date (as defined in such Swap Contract) resulting from (1) any event of default under such Swap Contract as to which the Company or any Subsidiary is the Defaulting Party (as defined in such Swap Contract) or (2) any Termination Event (as so defined) as to which the Company or any Subsidiary is an Affected Party (as so defined) and, in either event, the Swap Termination Value owed by the Company or such Subsidiary as a result thereof is greater than $10,000,000; provided, that any Event of Default arising under clause (i)(B) in respect of Indebtedness evidenced or governed by either Note Agreement shall be determined without regard to any amendment to or waiver of any provision of such Note Agreement or any related document or instrument entered into by the parties thereto in anticipation of, concurrent with or subsequent to the occurrence of any such event or circumstance; or

          (f) Insolvency; Voluntary Proceedings. The Company or any Subsidiary (i) ceases or fails to be solvent, or generally fails to pay, or admits in writing its inability to pay, its debts as they become due, subject to applicable grace periods, if any, whether at stated maturity or otherwise; (ii) voluntarily ceases to conduct its business in the ordinary course; (iii) commences any Insolvency Proceeding with respect to itself; or (iv) takes any action to effectuate or authorize any of the foregoing; or

          (g) Involuntary Proceedings. (i) Any involuntary Insolvency Proceeding is commenced or filed against the Company or any Subsidiary, or any writ, judgment, warrant of attachment, execution or similar process, is issued or levied against a substantial part of the Company’s or any Subsidiary’s properties, and any such proceeding or petition shall not be

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dismissed, or such writ, judgment, warrant of attachment, execution or similar process shall not be released, vacated or fully bonded within 60 days after commencement, filing or levy; (ii) the Company or any Subsidiary admits the material allegations of a petition against it in any Insolvency Proceeding, or an order for relief (or similar order under non-U.S. law) is ordered in any Insolvency Proceeding; or (iii) the Company or any Subsidiary acquiesces in the appointment of a receiver, trustee, custodian, conservator, liquidator, mortgagee in possession (or agent therefor), or other similar Person for itself or a substantial portion of its property or business; or

          (h) ERISA. (i) An ERISA Event shall occur with respect to a Pension Plan or Multiemployer Plan which has resulted or could reasonably be expected to result in liability of the Company or any ERISA Affiliate under Title IV of ERISA to such Pension Plan or Multiemployer Plan or to the PBGC in an aggregate amount for all such Pension Plans and Multiemployer Plans in excess of $1,000,000, less any outstanding amounts under clauses (ii) and (iii); (ii) the aggregate amount of Unfunded Pension Liability among all Pension Plans and Multiemployer Plans at any time exceeds $1,000,000, less any outstanding amounts under clauses (i) and (iii) (determined, in respect of Multiemployer Plans, by reference to the Unfunded Pension Liability for which the Company or any ERISA Affiliate may be liable); or (iii) the Company or any ERISA Affiliate shall fail to pay when due, after the expiration of any applicable grace period, any installment payment with respect to its withdrawal liability under Section 4201 of ERISA under a Multiemployer Plan in an aggregate amount in excess of $1,000,000, less any outstanding amounts under clauses (i) and (ii); or

          (i) Monetary Judgments. One or more non-interlocutory judgments, non-interlocutory orders, decrees or arbitration awards is entered against the Company or any Subsidiary involving in the aggregate a liability (to the extent not covered by independent third-party insurance as to which the insurer does not dispute coverage) as to any single or related series of transactions, incidents or conditions, of $5,000,000 or more, and the same shall remain unsatisfied, unvacated and unstayed pending appeal for a period of 10 days after the entry thereof; or

          (j) Non-Monetary Judgments. Any non-monetary judgment, order or decree is entered against the Company or any Subsidiary which does or would reasonably be expected to have a Material Adverse Effect, and there shall be any period of 20 consecutive days during which a stay of enforcement of such judgment or order, by reason of a pending appeal or otherwise, shall not be in effect; or

          (k) Change of Control. There occurs any Change of Control; or

          (l) Loss of Licenses. Any Governmental Authority revokes or fails to renew any license, permit or franchise of the Company or any Subsidiary, or the Company or any Subsidiary for any reason loses any license, permit or franchise, or the Company or any Subsidiary suffers the imposition of any restraining order, escrow, suspension or impound of funds in connection with any proceeding (judicial or administrative) with respect to any license, permit or franchise, in each case to the extent that the same individually, collectively or cumulatively, does or would reasonably be expected to have a Material Adverse Effect; or

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          (m) Guarantor Defaults. Any Guarantor fails in any material respect to perform or observe any term, covenant or agreement in the Subsidiary Guaranty; or the Subsidiary Guaranty is for any reason partially (including with respect to future advances) or wholly revoked or invalidated, or otherwise ceases to be in full force and effect, or any Guarantor or any other Person contests in any manner the validity or enforceability thereof or denies that it has any further liability or obligation thereunder; or any event described at subsections (f) or (g) of this Section occurs with respect to any Guarantor.

     9.02 Remedies. If any Event of Default occurs, the Agent shall, at the request of, or may, with the consent of, the Required Lenders,

          (a) declare the Commitment of each Lender to make Loans and any obligation of the Issuer to Issue Letters of Credit to be terminated, whereupon such Commitments and obligation shall be terminated;

          (b) declare an amount equal to the maximum aggregate amount that is or at any time thereafter may become available for drawing under any outstanding Letters of Credit (whether or not any beneficiary shall have presented, or shall be entitled at such time to present, the drafts or other documents required to draw under such Letters of Credit) to be immediately due and payable, and declare the unpaid principal amount of all outstanding Loans, all interest accrued and unpaid thereon, and all other amounts owing or payable hereunder or under any other Loan Document to be immediately due and payable, without presentment, demand, protest or other notice of any kind, all of which are hereby expressly waived by the Company; and

          (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;

provided, however, that upon the occurrence of any event specified in subsection (f) or (g) of Section 9.01 (in the case of clause (i) of subsection (g) upon the expiration of the 60-day period mentioned therein), the obligation of each Lender to make Loans and any obligation of the Issuer to Issue Letters of Credit shall automatically terminate and the unpaid principal amount of all outstanding Loans and all interest and other amounts as aforesaid shall automatically become due and payable without further act of the Agent, the Issuer or any Lender.

     9.03 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

THE AGENT AND THE CO-ADMINISTRATIVE AGENT

     10.01 Appointment and Authorization; “Agent”; “Co-Administrative Agent”. (a) Each Lender hereby irrevocably (subject to Section 10.09) appoints, designates and authorizes each of the Agent and the Co-Administrative 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

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Document, together with such powers as are reasonably incidental thereto. Notwithstanding any provision to the contrary contained elsewhere in this Agreement or in any other Loan Document, neither the Agent nor the Co-Administrative Agent shall have any duties or responsibilities, except those expressly set forth herein, nor shall the Agent or the Co-Administrative Agent have or be deemed to have any fiduciary relationship with any Lender, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this Agreement or any other Loan Document or otherwise exist against the Agent or the Co-Administrative Agent. Without limiting the generality of the foregoing sentence, the use of the term “agent” in this Agreement with reference to the Agent or the Co-Administrative Agent is not intended to connote any fiduciary or other implied (or express) obligations arising under agency doctrine of any applicable law. Instead, such term is used merely as a matter of market custom, and is intended to create or reflect only an administrative relationship between independent contracting parties.

          (b) The Issuer shall act on behalf of the Lenders with respect to any Letters of Credit Issued by it and the documents associated therewith until such time and except for so long as the Agent or the Co-Administrative Agent may agree at the request of the Required Lenders to act for the Issuer with respect thereto; provided, however, that the Issuer shall have all of the benefits and immunities (i) provided to the Agent and the Co-Administrative Agent in this Article X with respect to any acts taken or omissions suffered by the Issuer in connection with Letters of Credit Issued by it or proposed to be Issued by it and the application and agreements for letters of credit pertaining to the Letters of Credit as fully as if the term “Agent”, as used in this Article X, included the Issuer with respect to such acts or omissions, and (ii) as additionally provided in this Agreement with respect to the Issuer.

     10.02 Delegation of Duties. The Agent and the Co-Administrative Agent may execute any of their duties under this Agreement or any other Loan Document by or through agents, employees or attorneys-in-fact and shall be entitled to advice of counsel concerning all matters pertaining to such duties. Neither the Agent nor the Co-Administrative Agent shall be responsible for the negligence or misconduct of any agent or attorney-in-fact that it selects with reasonable care.

     10.03 Liability of Agent and Co-Administrative Agent. None of the Agent-Related Persons shall (a) be liable for any action taken or omitted to be taken by any of them under or in connection with this Agreement or any other Loan Document or the transactions contemplated hereby (except for its own gross negligence or willful misconduct), or (b) be responsible in any manner to any of the Lenders for any recital, statement, representation or warranty made by the Company or any Subsidiary or Affiliate of the Company, 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 the Agent under or in connection with, this Agreement or any other Loan Document, or for the value of or title to any collateral, or the validity, effectiveness, genuineness, enforceability or sufficiency of this Agreement or any other Loan Document, or for any failure of the Company or any other party to any Loan Document to perform its obligations hereunder or thereunder. No Agent-Related Person shall be under any obligation to any Lender to ascertain or to inquire as to the observance or performance of any of the agreements contained in, or conditions of, this Agreement or any other Loan Document, or to

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inspect the properties, books or records of the Company or any of the Company’s Subsidiaries or Affiliates.

     10.04 Reliance by Agent and Co-Administrative Agent. (a) The Agent and the Co-Administrative 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 the Company), independent accountants and other experts selected by the Agent and the Co-Administrative Agent. The Agent and the Co-Administrative Agent shall be fully justified in failing or refusing to take any action under this Agreement or any other Loan Document unless they shall first receive such advice or concurrence of the Required Lenders as they deem appropriate and, if they so request, they shall first be indemnified to their satisfaction by the Lenders against any and all liability and expense which may be incurred by them by reason of taking or continuing to take any such action. The Agent and the Co-Administrative Agent shall in all cases be fully protected in acting, or in refraining from acting, under this Agreement or any other Loan Document in accordance with a request or consent of the Required Lenders and such request and any action taken or failure to act pursuant thereto shall be binding upon all of the Lenders.

          (b) For purposes of determining compliance with the conditions specified in Section 5.01, 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 either sent by the Agent or the Co-Administrative Agent to such Lender for consent, approval, acceptance or satisfaction, or required thereunder to be consented to or approved by or acceptable or satisfactory to such Lender.

     10.05 Notice of Default. Neither the Agent nor the Co-Administrative Agent shall be deemed to have knowledge or notice of the occurrence of any Default or Event of Default, except with respect to defaults in the payment of principal, interest and fees required to be paid to the Agent or the Co-Administrative Agent for the account of the Lenders, unless the Agent and the Co-Administrative Agent shall have received written notice from a Lender or the Company referring to this Agreement, describing such Default or Event of Default and stating that such notice is a “notice of default”. The Agent and the Co-Administrative Agent will notify the Lenders of their receipt of any such notice. The Agent shall take such action with respect to such Default or Event of Default as may be requested by the Required Lenders in accordance with Article IX; provided, however, that unless and until the Agent has received any such request, the Agent may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to such Default or Event of Default as it shall deem advisable or in the best interest of the Lenders.

     10.06 Credit Decision. Each Lender acknowledges that none of the Agent-Related Persons has made any representation or warranty to it, and that no act by the Agent or the Co-Administrative Agent hereinafter taken, including any review of the affairs of the Company and its Subsidiaries, shall be deemed to constitute any representation or warranty by any Agent-Related Person to any Lender. Each Lender represents to the Agent and the Co-Administrative Agent that it has, independently and without reliance upon any Agent-Related Person and based

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on such documents and information as it has deemed appropriate, made its own appraisal of and investigation into the business, prospects, operations, property, financial and other condition and creditworthiness of the Company and its Subsidiaries, the value of and title to any collateral, and all applicable bank regulatory laws relating to the transactions contemplated hereby, and made its own decision to enter into this Agreement and to extend credit to the Company hereunder. Each Lender also represents that it will, independently and without reliance upon any Agent-Related Person and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit analysis, appraisals and decisions in taking or not taking action under this Agreement and the other Loan Documents, and to make such investigations as it deems necessary to inform itself as to the business, prospects, operations, property, financial and other condition and creditworthiness of the Company. Except for notices, reports and other documents expressly herein required to be furnished to the Lenders by the Agent or the Co-Administrative Agent, neither the Agent nor the Co-Administrative Agent shall 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 the Company which may come into the possession of any of the Agent-Related Persons.

     10.07 Indemnification of Agent and Co-Administrative Agent. Whether or not the transactions contemplated hereby are consummated, the Lenders shall indemnify upon demand the Agent-Related Persons (to the extent not reimbursed by or on behalf of the Company and without limiting the obligation of the Company to do so), in accordance with such Lender’s Pro Rata Share of all Loans and Commitments, from and against any and all Indemnified Liabilities; provided, however, that no Lender shall be liable for the payment to the Agent-Related Persons of any portion of such Indemnified Liabilities resulting from such Person’s gross negligence or willful misconduct. Without limitation of the foregoing, each Lender shall reimburse each of the Agent and the Co-Administrative Agent upon demand for its ratable share of any costs or out-of-pocket expenses (including Attorney Costs) incurred by the Agent or the Co-Administrative Agent in connection with the preparation, execution, delivery, administration, modification, amendment or enforcement (whether through negotiations, legal proceedings or otherwise) of, or legal advice in respect of rights or responsibilities under, this Agreement, any other Loan Document, or any document contemplated by or referred to herein, to the extent that the Agent or the Co-Administrative Agent is not reimbursed for such expenses by or on behalf of the Company. The undertaking in this Section shall survive the payment of all Obligations hereunder and the resignation or replacement of the Agent or the Co-Administrative Agent.

     10.08 Agent in Individual Capacity. Bank of America, LaSalle and their Affiliates may make loans to, issue letters of credit for the account of, accept deposits from, acquire equity interests in and generally engage in any kind of banking, trust, financial advisory, underwriting or other business with the Company and its Subsidiaries and Affiliates as though Bank of America were not the Agent hereunder and as though LaSalle were not the Co-Administrative Agent or the Issuer hereunder and without notice to or consent of the Lenders. The Lenders acknowledge that, pursuant to such activities, Bank of America, LaSalle or their Affiliates may receive information regarding the Company or its Affiliates (including information that may be subject to confidentiality obligations in favor of the Company or such Subsidiary) and acknowledge that neither the Agent nor the Co-Administrative Agent shall be under any obligation to provide such information to them. With respect to its Loans, Bank of America and LaSalle shall have the same rights and powers under this Agreement as any other Lender and

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may exercise the same as though it were not the Agent or the Issuer or the Co-Administrative Agent, respectively.

     10.09 Successor Agent. Either the Agent or the Co-Administrative Agent may, and at the request of the Required Lenders shall, resign upon 30 days’ notice to the Lenders. If the Agent or the Co-Administrative Agent resigns under this Agreement, the Required Lenders shall appoint from among the Lenders a successor agent or co-administrative agent for the Lenders subject, so long as no Event of Default has occurred and is then continuing, to the consent of the Company, which shall not be unreasonably withheld or delayed. If no successor agent is appointed prior to the effective date of the resignation of the Agent or the Co-Administrative Agent, the Agent or the Co-Administrative Agent may appoint, after consulting with the Lenders and the Company, a successor agent from among the Lenders. Upon the acceptance of its appointment as successor agent hereunder, such successor agent or co-administrative agent shall succeed to all the rights, powers and duties of the retiring Agent and the term “Agent” or “Co-Administrative Agent”, as applicable, shall mean such successor agent and the retiring Agent’s or Co-Administrative Agent’s appointment, powers and duties as Agent shall be terminated. After any retiring Agent’s or Co-Administrative Agent’s resignation hereunder as Agent or Co-Administrative Agent, the provisions of this Article X and Sections 11.04 and 11.05 shall inure to its benefit as to any actions taken or omitted to be taken by it while it was Agent or Co-Administrative Agent under this Agreement. If no successor agent has accepted appointment as Agent by the date which is 30 days following a retiring Agent’s or Co-Administrative Agent’s notice of resignation, the retiring Agent’s or Co-Administrative Agent’s resignation shall nevertheless thereupon become effective and the Co-Administrative Agent shall perform all of the duties of the Agent, or the Agent shall perform all of the duties of the Co-Administrative Agent, as applicable, hereunder until such time, if any, as the Required Lenders appoint a successor agent or co-administrative agent as provided for above. Notwithstanding the foregoing, however, LaSalle may not be removed as the Co-Administrative Agent at the request of the Required Lenders unless LaSalle shall also simultaneously be replaced as an “Issuer” (if any letters of credit Issued by LaSalle are then outstanding) hereunder pursuant to documentation in form and substance reasonably satisfactory to LaSalle.

     10.10 Withholding Tax. (a) If any Lender is a “foreign corporation, partnership or trust” within the meaning of the Code and such Lender claims exemption from, or a reduction of, U.S. withholding tax under Sections 1441 or 1442 of the Code, such Lender agrees with and in favor of the Agent and the Company, to deliver to the Agent and the Company:

          (i) if such Lender claims an exemption from, or a reduction of, withholding tax under a United States tax treaty, two properly completed and executed copies of IRS Form 1001 (or its successor) before the payment of any interest in the first calendar year and before the payment of any interest in each third succeeding calendar year during which interest may be paid under this Agreement;

          (ii) if such Lender claims that interest paid under this Agreement is exempt from United States withholding tax because it is effectively connected with a United States trade or business of such Lender, two properly completed and executed copies of IRS Form 4224 (or its successor) before the payment of any interest is due in

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the first taxable year of such Lender and in each succeeding taxable year of such Lender during which interest may be paid under this Agreement; and

          (iii) such other form or forms as may be required under the Code or other laws of the United States as a condition to exemption from, or reduction of, United States withholding tax.

     Such Lender agrees to promptly notify the Agent and the Company of any change in circumstances which would modify or render invalid any claimed exemption or reduction.

          (b) If any Lender claims exemption from, or reduction of, withholding tax under a United States tax treaty by providing IRS Form 1001 (or its successor) and such Lender sells, assigns, grants a participation in, or otherwise transfers all or part of the Obligations of the Company to such Lender, such Lender agrees to notify the Agent of the percentage amount in which it is no longer the beneficial owner of Obligations of the Company to such Lender. To the extent of such percentage amount, the Agent will treat such Lender’s IRS Form 1001 (or its successor) as no longer valid.

          (c) If any Lender claiming exemption from United States withholding tax by filing IRS Form 4224 (or its successor) with the Agent sells, assigns, grants a participation in, or otherwise transfers all or part of the Obligations of the Company to such Lender, such Lender agrees to undertake sole responsibility for complying with the withholding tax requirements imposed by Sections 1441 and 1442 of the Code.

          (d) If any Lender is entitled to a reduction in the applicable withholding tax, the Agent may withhold from any interest payment to such Lender an amount equivalent to the applicable withholding tax after taking into account such reduction. However, if the forms or other documentation required by subsection (a) of this Section are not delivered to the Agent, then the Agent may withhold from any interest payment to such Lender not providing such forms or other documentation an amount equivalent to the applicable withholding tax imposed by Sections 1441 and 1442 of the Code, without reduction.

          (e) If the IRS or any other Governmental Authority of the United States or other jurisdiction asserts a claim that the Agent did not properly withhold tax from amounts paid to or for the account of any Lender (because the appropriate form was not delivered or was not properly executed, or because such Lender failed to notify the 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 the Agent fully for all amounts paid, directly or indirectly, by the Agent as tax or otherwise, including penalties and interest, and including any taxes imposed by any jurisdiction on the amounts payable to the Agent under this Section, together with all costs and expenses (including Attorney Costs). The obligation of the Lenders under this subsection shall survive the payment of all Obligations and the resignation or replacement of the Agent.

     10.11 Co-Agents. None of the Lenders identified on the facing page or signature pages of this Agreement as a “co-agent”, “syndication agent” or “documentation agent” shall have any right, power, obligation, liability, responsibility or duty under this Agreement other than those

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applicable to all Lenders as such. Without limiting the foregoing, none of the Lenders so identified as a “co-agent”, “syndication agent” or “documentation agent” shall have or be deemed to have any fiduciary relationship with any Lender. Each Lender acknowledges that it has not relied, and will not rely, on any of the Lenders so identified in deciding to enter into this Agreement or in taking or not taking action hereunder.

ARTICLE XI

MISCELLANEOUS

     11.01 Amendments and Waivers. No amendment or waiver of any provision of this Agreement or any other Loan Document, and no consent to any departure by the Company or any other applicable Subsidiary therefrom, shall be effective unless in writing signed by the Required Lenders and the Company, and acknowledged by the Agent, and each such amendment, waiver or consent shall be effective only in the specific instance and for the specific purpose for which given; provided, that no such amendment, waiver or consent shall:

          (a) waive any condition set forth in Section 5.01 without the written consent of each Lender;

          (b) extend or increase the Commitment of any Lender (or reinstate any Commitment terminated pursuant to Section 9.02) without the written consent of such Lender;

          (c) postpone any date fixed by this Agreement or any other Loan Document for any payment (excluding mandatory prepayments, if any) of principal, interest, fees or other amounts due to the Lenders (or any of them) hereunder or under any other Loan Document without the written consent of each Lender directly affected thereby;

          (d) reduce the principal of, or the rate of interest specified herein on, any Loan or L/C Borrowing, or (subject to clause (iv) of the proviso below) any fees or other amounts payable hereunder or under any other Loan Document without the written consent of each Lender directly affected thereby; provided, however, that only the consent of the Required Lenders shall be necessary to amend the definition of “Default Rate” or to waive any obligation of the Company to pay interest at the Default Rate;

          (e) change any provision of this Section or the definition of “Required Lenders” or any other provision hereof specifying the number or percentage of Lenders required to amend, waive or otherwise modify any rights hereunder or make any determination or grant any consent hereunder, without the written consent of each Lender;

          (f) amend Section 2.15 in a manner that would alter the pro rata sharing of payments required thereby without the written consent of each Lender;

          (g) release all or substantially all of the Guarantors from the Subsidiary Guaranty without the written consent of each Lender;

and, provided further, that (i) no amendment, waiver or consent shall, unless in writing and signed by the Issuer in addition to the Required Lenders and/or each directly-affected Lender, as

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the case may be, affect the rights or duties of the Issuer under this Agreement or any Letter of Credit Application relating to any Letter of Credit issued or to be issued by it; (ii) no amendment, waiver or consent shall, unless in writing and signed by the Swing Line Lender in addition to the Required Lenders and/or each directly-affected Lender, as the case may be, affect the rights or duties of the Swing Line Lender under this Agreement; (iii) no amendment, waiver or consent shall, unless in writing and signed by the Agent or the Co-Administrative Agent in addition to the Required Lenders and/or each directly-affected Lender, as the case may be, affect the rights or duties of the Agent or the Co-Administrative Agent under this Agreement or any other Loan Document; and (iv) the Agent Fee Letter and the Co-Administrative Agent Fee Letter may be amended, or rights or privileges thereunder waived, in a writing executed only by the respective parties thereto.

     11.02 Notices. (a) All notices, requests, consents, approvals, waivers and other communications shall be in writing (including, unless the context expressly otherwise provides, by facsimile transmission, provided that any matter transmitted by the Company by facsimile (i) shall be immediately confirmed by a telephone call to the recipient at the number specified on Schedule 11.02, and (ii) shall be followed promptly by delivery of a hard copy original thereof) and mailed, faxed or delivered, to the address or facsimile number specified for notices on Schedule 11.02; or, as directed to the Company or the Agent, to such other address as shall be designated by such party in a written notice to the other parties, and as directed to any other party, at such other address as shall be designated by such party in a written notice to the Company and the Agent.

          (b) All such notices, requests and communications shall, when transmitted by overnight delivery, or faxed, be effective when delivered for overnight (next-day) delivery, or transmitted in legible form by facsimile machine, respectively, or if mailed, upon the third Business Day after the date deposited into the U.S. mail, or if delivered, upon delivery; except that notices pursuant to Article II, III or X to the Agent or the Co-Administrative Agent shall not be effective until actually received by the Agent or the Co-Administrative Agent, and notices pursuant to Article III to the Issuer shall not be effective until actually received by the Issuer at the address specified on Schedule 11.02.

          (c) Any agreement of the Agent and the Lenders herein to receive certain notices by telephone or facsimile is solely for the convenience and at the request of the Company. The Agent and the Lenders shall be entitled to rely on the authority of any Person purporting to be a Person authorized by the Company to give such notice and the Agent and the Lenders shall not have any liability to the Company or other Person on account of any action taken or not taken by the Agent or the Lenders in reliance upon such telephonic or facsimile notice. The obligation of the Company to repay the Loans and L/C Obligations shall not be affected in any way or to any extent by any failure by the Agent, the Co-Administrative Agent and the Lenders to receive written confirmation of any telephonic or facsimile notice or the receipt by the Agent, the Co-Administrative Agent and the Lenders of a confirmation which is at variance with the terms understood by the Agent, the Co-Administrative Agent and the Lenders to be contained in the telephonic or facsimile notice.

     11.03 No Waiver; Cumulative Remedies. No failure to exercise and no delay in exercising, on the part of the Agent, the Co-Administrative Agent or any Lender, any right,

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remedy, power or privilege hereunder, shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege.

     11.04 Costs and Expenses. The Company shall:

          (a) whether or not the transactions contemplated hereby are consummated, pay or reimburse Bank of America (including in its capacity as Agent) and the Arranger within five Business Days after demand (subject to subsection 5.01(e)) for all costs and expenses incurred by Bank of America (including in its capacity as the Agent) and the Arranger in connection with the development, preparation, delivery, administration, syndication and execution of, and any amendment, supplement, waiver or modification to (in each case, whether or not consummated), this Agreement, any Loan Document and any other documents prepared in connection herewith or therewith, and the consummation of the transactions contemplated hereby and thereby, including reasonable Attorney Costs incurred by Bank of America (including in its capacity as the Agent) and the Arranger with respect thereto;

          (b) pay or reimburse the Agent, the Co-Administrative Agent, the Arranger and each Lender within five Business Days after demand (subject to subsection 5.01(e)) for all costs and expenses (including Attorney Costs) incurred by them in connection with the enforcement, attempted enforcement, or preservation of any rights or remedies under this Agreement or any other Loan Document during the existence of an Event of Default or after acceleration of the Loans (including in connection with any “workout” or restructuring regarding the Loans, and including in any Insolvency Proceeding or appellate proceeding); and

          (c) pay or reimburse Bank of America (including in its capacity as the Agent) within five Business Days after demand (subject to subsection 5.01(e)) for all reasonable appraisal (including the allocated cost of internal appraisal services), audit, environmental inspection and review (including the allocated cost of such internal services), search and filing costs, fees and expenses, incurred or sustained by Bank of America (including in its capacity as the Agent) in connection with the matters referred to under subsections (a) and (b) of this Section.

     11.05 Company Indemnification. Whether or not the transactions contemplated hereby are consummated, the Company shall indemnify, defend and hold the Agent-Related Persons, the Arranger and each Lender and each of its respective Affiliates, officers, directors, employees, counsel, agents and attorneys-in-fact (each, an “Indemnified Person”) harmless from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, charges, expenses and disbursements (including Attorney Costs) of any kind or nature whatsoever which may at any time (including at any time following repayment of the Loans, the termination of the Letters of Credit and the termination, resignation or replacement of the Agent or replacement of any Lender or assignment by any Lender of its Loans or Commitments) be imposed on, incurred by or asserted against any Indemnified Person in any way relating to or arising out of this Agreement or any document contemplated by or referred to herein, or the transactions contemplated hereby, or any action taken or omitted by any such Person under or in connection with any of the foregoing, including with respect to any investigation, litigation or proceeding (including any Insolvency Proceeding or appellate proceeding) related to or arising

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out of this Agreement or the Loans or Letters of Credit or the use of the proceeds thereof, whether or not any Indemnified Person is a party thereto (all the foregoing, collectively, the “Indemnified Liabilities”); provided, that the Company shall have no obligation hereunder to any Indemnified Person with respect to Indemnified Liabilities resulting solely from the gross negligence or willful misconduct of such Indemnified Person. The agreements in this Section shall survive payment of all other Obligations.

     11.06 Marshalling; Payments Set Aside. Neither the Agent, the Co-Administrative Agent nor the Lenders shall be under any obligation to marshall any assets in favor of the Company or any other Person or against or in payment of any or all of the Obligations. To the extent that the Company makes a payment to the Agent, the Co-Administrative Agent or the Lenders, or the Agent, the Co-Administrative Agent or the Lenders exercise their right of set-off, and such payment or the proceeds of such set-off or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside or required (including pursuant to any settlement entered into by the Agent, the Co-Administrative Agent or such Lender in its discretion) to be repaid to a trustee, receiver or any other party, in connection with any Insolvency Proceeding or otherwise, then (a) to the extent of such recovery the obligation or part thereof originally intended to be satisfied shall be revived and continued in full force and effect as if such payment had not been made or such set-off had not occurred, and (b) each Lender severally agrees to pay to the Agent or the Co-Administrative Agent upon demand its pro rata share of any amount so recovered from or repaid by the Agent or the Co-Administrative Agent.

     11.07 Successors and Assigns. The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns, except that the Company may not assign or transfer any of its rights or obligations under this Agreement without the prior written consent of the Agent, the Co-Administrative Agent and each Lender.

     11.08 Assignments, Participations, etc. (a) Any Lender may, with the written consent of the Company at all times other than during the existence of an Event of Default and the Agent, the Swing Line Lender and the Issuer, which consents shall not be unreasonably withheld or delayed, at any time assign and delegate to one or more Eligible Assignees (each an “Assignee”) all, or any part of all, of the Loans, the Commitments, the L/C Obligations and the other rights and obligations of such Lender hereunder, in a minimum amount of $5,000,000 or, if less, the total amount of such Lender’s outstanding Loans and/or Commitments (provided that no written consent of the Company, the Agent, the Swing Line Lender or the Issuer shall be required in connection with any assignment and delegation by a Lender to an Eligible Assignee that is an Affiliate of such Lender); provided, however, that the Company, the Agent and the Co-Administrative Agent may continue to deal solely and directly with such Lender in connection with the interest so assigned to an Assignee until (i) written notice of such assignment, together with payment instructions, addresses and related information with respect to the Assignee, shall have been given to the Company, the Agent and the Co-Administrative Agent by such Lender and the Assignee; (ii) such Lender and its Assignee shall have delivered to the Company and the Agent an Assignment and Acceptance in the form of Exhibit D (“Assignment and Acceptance”) together with any Note or Notes subject to such assignment and (iii) the assignor Lender or Assignee has paid to the Co-administrative Agent a processing fee in the amount of $2,500.

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          (b) From and after the date that the Agent notifies the assignor Lender that it has received (and, if required, provided its consent with respect to) an executed Assignment and Acceptance and payment of the above-referenced processing fee, (i) the Assignee thereunder shall be a party hereto and, to the extent that rights and obligations hereunder (including without limitation any obligations under Section 10.10) have been assigned to it pursuant to such Assignment and Acceptance, shall have the rights and obligations of a Lender under the Loan Documents, and (ii) the assignor Lender shall, to the extent that rights and obligations hereunder and under the other Loan Documents have been assigned by it pursuant to such Assignment and Acceptance, relinquish its rights and be released from its obligations under the Loan Documents.

          (c) Within five Business Days after its receipt of notice by the Agent that it has received an executed Assignment and Acceptance and payment of the processing fee, (and, if required, provided that it consents to such assignment in accordance with subsection 11.08(a)), the Company shall execute and deliver to the Agent new Notes evidencing such Assignee’s assigned Loans and Commitment and, if the assignor Lender has retained a portion of its Loans and its Commitment, replacement Notes in the principal amount of the Loans retained by the assignor Lender (such Notes to be in exchange for, but not in payment of, the Notes held by such Lender). Immediately upon each Assignee’s making its processing fee payment under the Assignment and Acceptance, this Agreement shall be deemed to be amended to the extent, but only to the extent, necessary to reflect the addition of the Assignee and the resulting adjustment of the Commitments arising therefrom. The Commitment allocated to each Assignee shall reduce such Commitments of the assigning Lender pro tanto.

          (d) Any Lender may at any time sell to one or more commercial banks or other Persons not Affiliates of the Company (a “Participant”) participating interests in any Loans, the Commitment of that Lender and the other interests of that Lender (the “originating Lender”) hereunder and under the other Loan Documents; provided, however, that (i) the originating Lender’s obligations under this Agreement shall remain unchanged, (ii) the originating Lender shall remain solely responsible for the performance of such obligations, (iii) the Company, each Issuer and the Agent shall continue to deal solely and directly with the originating Lender in connection with the originating Lender’s rights and obligations under this Agreement and the other Loan Documents, and (iv) no Lender shall transfer or grant any participating interest under which the Participant has rights to approve any amendment to, or any consent or waiver with respect to, this Agreement or any other Loan Document, except to the extent such amendment, consent or waiver would require unanimous consent of the Lenders as described in clause (a) (but only in respect of any increase of any Commitment of any originating Lender), (b) or (e) of the first proviso to Section 11.01. In the case of any such participation, the Participant shall be entitled to the benefit of Sections 4.01, 4.03 and 11.05 as though it were also a Lender hereunder, and if amounts outstanding under this Agreement are due and unpaid, or shall have been declared or shall have become due and payable upon the occurrence of an Event of Default, each Participant shall be deemed to have the right of set-off in respect of its participating interest in amounts owing under this Agreement to the same extent as if the amount of its participating interest were owing directly to it as a Lender under this Agreement.

          (e) Notwithstanding any other provision in this Agreement, any Lender may at any time create a security interest in, or pledge, all or any portion of its rights under and interest in this Agreement and the Notes held by it in favor of any Federal Reserve Bank in

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accordance with Regulation A of the FRB or U.S. Treasury Regulation 31 CFR §203.14, and such Federal Reserve Bank may enforce such pledge or security interest in any manner permitted under applicable law.

     11.09 Confidentiality. Each Lender agrees to take and to cause its Affiliates to take normal and reasonable precautions and exercise due care to maintain the confidentiality of all information identified as “confidential” by the Company and provided to it by the Company or any Subsidiary, or by the Agent on the Company’s or such Subsidiary’s behalf, under this Agreement or any other Loan Document, and neither it nor any of its Affiliates shall use any such information other than in connection with or in enforcement of this Agreement and the other Loan Documents or in connection with other business now or hereafter existing or contemplated with the Company or any Subsidiary; except to the extent such information (i) was or becomes generally available to the public other than as a result of disclosure by the Lender; or (ii) was or becomes available on a non-confidential basis from a source other than the Company, provided that such source is not bound by a confidentiality agreement with the Company known to the Lender; provided, however, that any Lender may disclose such information (A) at the request or pursuant to any requirement of any Governmental Authority to which the Lender is subject or in connection with an examination of such Lender by any such authority; (B) pursuant to subpoena or other court process; (C) when required to do so in accordance with the provisions of any applicable Requirement of Law; (D) to the extent reasonably required in connection with any litigation or proceeding to which the Agent, the Co-Administrative Agent, any Lender or their respective Affiliates may be party; (E) to the extent reasonably required in connection with the exercise of any remedy hereunder or under any other Loan Document; (F) to such Lender’s independent auditors and other professional advisors; (G) to any Participant or Assignee, actual or potential, provided that such Person agrees to keep such information confidential to the same extent required of the Lenders hereunder; (H) as to any Lender or its Affiliate, as expressly permitted under the terms of any other document or agreement regarding confidentiality to which the Company or any Subsidiary is party or is deemed party with such Lender or such Affiliate; (I) to its Affiliates; and (J) to the National Association of Insurance Commissioners or any similar organization or any nationally recognized rating agency that requires access to information about such Lender’s investment portfolio in connection with ratings issued with respect to such Lender.

     11.10 Set-off. In addition to any rights and remedies of the Lenders provided by law, if an Event of Default exists or the Loans have been accelerated, each Lender is authorized at any time and from time to time, without prior notice to the Company, any such notice being waived by the Company to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or demand, provisional or final) at any time held by, and other indebtedness at any time owing by, such Lender to or for the credit or the account of the Company against any and all Obligations owing to such Lender, now or hereafter existing, irrespective of whether or not the Agent or such Lender shall have made demand under this Agreement or any Loan Document and although such Obligations may be contingent or unmatured. Each Lender agrees promptly to notify the Company and the Agent after any such set-off and application made by such Lender; provided, however, that the failure to give such notice shall not affect the validity of such set-off and application.

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     11.11 Automatic Debits of Fees. With respect to any principal or interest due on the Loans, unreimbursed L/C Obligation, non-use fee, arrangement fee, letter of credit fee or other fee, or any other cost or expense (including Attorney Costs) due and payable to the Agent, the Co-Administrative Agent, the Issuer, Bank of America, LaSalle or the Arranger under the Loan Documents, the Company hereby irrevocably authorizes Bank of America or LaSalle to debit any deposit account of the Company with Bank of America or LaSalle or any of its Affiliates in an amount such that the aggregate amount debited from all such deposit accounts does not exceed such fee or other cost or expense. If there are insufficient funds in such deposit accounts to cover the amount of the fee or other cost or expense then due, such debits will be reversed (in whole or in part, in Bank of America’s or LaSalle’s sole discretion) and such amount not debited shall be deemed to be unpaid. No such debit under this Section shall be deemed a set-off.

     11.12 Notification of Addresses, Lending Offices, Etc. Each Lender shall notify the Agent in writing of any changes in the address to which notices to the Lender should be directed, of addresses of any Lending Office, of payment instructions in respect of all payments to be made to it hereunder and of such other administrative information as the Agent shall reasonably request.

     11.13 Counterparts. This Agreement may be executed in any number of separate counterparts, each of which, when so executed, shall be deemed an original, and all of said counterparts taken together shall be deemed to constitute but one and the same instrument.

     11.14 Severability. The illegality or unenforceability of any provision of this Agreement or any instrument or agreement required hereunder shall not in any way affect or impair the legality or enforceability of the remaining provisions of this Agreement or any instrument or agreement required hereunder.

     11.15 No Third Parties Benefited. This Agreement is made and entered into for the sole protection and legal benefit of the Company, the Lenders, the Agent, the Co-Administrative Agent, the Arranger and the Agent-Related Persons, and their permitted successors and assigns, and no other Person shall be a direct or indirect legal beneficiary of, or have any direct or indirect cause of action or claim in connection with, this Agreement or any of the other Loan Documents.

     11.16 GOVERNING LAW AND JURISDICTION. (A) THIS AGREEMENT AND THE NOTES SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAW OF THE STATE OF ILLINOIS (WITHOUT REGARD TO CONFLICTS OF LAW PROVISIONS THEREOF); PROVIDED THAT THE COMPANY, THE AGENT, THE CO-ADMINISTRATIVE AGENT AND THE LENDERS SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW.

          (B) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF ILLINOIS OR OF THE UNITED STATES FOR THE NORTHERN DISTRICT OF ILLINOIS, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH OF THE COMPANY, THE AGENT, THE CO-ADMINISTRATIVE AGENT AND THE LENDERS CONSENTS, FOR ITSELF AND IN RESPECT OF ITS

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PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. EACH OF THE COMPANY, THE AGENT, THE CO-ADMINISTRATIVE AGENT AND THE LENDERS IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF THIS AGREEMENT OR ANY DOCUMENT RELATED HERETO. THE COMPANY, THE AGENT, THE CO-ADMINISTRATIVE AGENT AND THE LENDERS EACH WAIVE PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY ILLINOIS LAW.

     11.17 WAIVER OF JURY TRIAL. THE COMPANY, THE LENDERS, THE AGENT AND THE CO-ADMINISTRATIVE AGENT EACH WAIVE THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS AGREEMENT, THE OTHER LOAN DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES AGAINST ANY OTHER PARTY OR ANY AGENT-RELATED PERSON, PARTICIPANT OR ASSIGNEE, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. THE COMPANY, THE LENDERS, THE AGENT AND THE CO-ADMINISTRATIVE AGENT EACH AGREE THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT LIMITING THE FOREGOING, THE PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION AS TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS OR ANY PROVISION HEREOF OR THEREOF. THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS.

     11.18 Judgment. If, for the purposes of obtaining judgment in any court, it is necessary to convert a sum due hereunder or under any other Loan Document in one currency into another currency, the rate of exchange used shall be that at which in accordance with normal banking procedures the Co-Administrative Agent could purchase the first currency with such other currency on the Business Day preceding that on which final judgment is given. The obligation of the Company in respect of any such sum due from it to the Agent, the Co-Administrative Agent or any Lender hereunder or under the other Loan Documents shall, notwithstanding any judgment in a currency (the “Judgment Currency”) other than that in which such sum is denominated in accordance with the applicable provisions of this Agreement (the “Agreement Currency”), be discharged only to the extent that on the Business Day following receipt by the Agent or such Lender of any sum adjudged to be so due in the Judgment Currency, the Agent, the Co-Administrative Agent or such Lender may in accordance with normal banking procedures purchase the Agreement Currency with the Judgment Currency. If the amount of the Agreement Currency so purchased is less than the sum originally due to the Agent, the Co-Administrative Agent or such Lender in the Agreement Currency, the Company agrees, as a separate obligation and notwithstanding any such judgment, to indemnify the Agent, the Co-Administrative Agent or

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such Lender or the Person to whom such obligation was owing against such loss. If the amount of the Agreement Currency so purchased is greater than the sum originally due to the Agent, the Co-Administrative Agent or such Lender in such currency, the Agent, the Co-Administrative Agent or such Lender agrees to return the amount of any excess to the Company (or to any other Person who may be entitled thereto under applicable law).

     11.19 Entire Agreement. This Agreement, together with the other Loan Documents, embodies the entire agreement and understanding among the Company, the Lenders and the Agent, and supersedes all prior or contemporaneous agreements and understandings of such Persons, verbal or written, relating to the subject matter hereof and thereof.

     11.20 Euro Currency. (a) If at any time that an Offshore Currency Loan is outstanding, the relevant Offshore Currency is replaced as the lawful currency of the country that issued such Offshore Currency (the “Issuing Country”) by the Euro then such Offshore Currency Loan shall be automatically converted into a Loan denominated in Euros in a principal amount equal to the amount of Euros into which the principal amount of such Offshore Currency Loan would be converted pursuant to the laws of the Issuing Country and thereafter (i) no further Loans will be available in such Offshore Currency and (ii) all references in the Loan Documents to such Offshore Currency shall be deemed to be the Euro.

          (b) The Company agrees, at the request of any Lender, to compensate each Lender for any loss, cost, expense or reduction in return that such Lender shall reasonably determine shall be incurred or sustained by such Lender as a result of the implementation of the European Monetary Union and the Euro and that would not have been incurred or sustained by such Lender but for the transactions provided for herein. A certificate of any such Lender setting forth such Lender’s determination of the amount or amounts necessary to compensate such Lender shall be delivered to the Co-Administrative Agent for delivery to the Company and shall be conclusive absent manifest error so long as such determination is made by such Lender on a reasonable basis. The Company shall pay such Lender the amount shown as due on any such certificate within 10 days after receipt thereof. The agreements and obligations of the Company in this Section 11.20 shall survive the payment of all obligations.

     11.21 Restatement Date. The Company, each Lender, the Agent and the Co-Administrative Agent agree that on the Restatement Date the following transactions shall be deemed to occur automatically, without further action by any party hereto:

          (a) The Prior Credit Agreement shall be deemed to be amended and restated in its entirety in the form of this Agreement.

          (b) The Co-Administrative Agent shall, promptly after receipt of the Notes reflecting amendments to the Prior Credit Agreement effected hereunder, cancel and return to the Company (upon receipt from the Lenders) the promissory notes being replaced by such Notes.

     The Company, each Lender, the Agent and the Co-Administrative Agent agree that (i) the restatement transactions provided in the foregoing sentence shall not be effective until the execution of this Agreement by all of the parties hereto and the satisfaction of the conditions precedent set forth in Section 5.01 hereof, (ii) all terms and conditions of the Prior Credit

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Agreement which are amended and restated by this Agreement shall remain effective until such amendment and restatement becomes effective hereunder, and thereafter shall continue to be effective only as amended and restated by this Agreement, and (iii) the representations, warranties and covenants set forth herein shall become effective concurrently with the execution of this Agreement by all of the parties hereto.

          (c) The Lenders, upon the effectiveness of this Agreement in accordance with its terms, will continue to lend monies and/or make advances, extensions of credit or other financial accommodations to, on behalf of or for the benefit of the Company pursuant hereto, and (i) any loans made under the Prior Credit Agreement which are not repaid on the Restatement Date will automatically, and without further action on the part of the Lenders or the Company, become Revolving Loans under this Agreement held ratably in proportion to the several Commitments of the Lenders hereunder and (ii) any Existing Letter of Credit issued and outstanding under the Prior Credit Agreement will automatically, and without further action on the part of the Lenders or the Company, become Letters of Credit under this Agreement. Any loans under the Prior Credit Agreement which are repaid on the Restatement Date will be paid to the Lenders under the Prior Credit Agreement in such proportions as shall be necessary to (x) repay in full the Loans held by any lenders under the Prior Credit Agreement which are not Lenders hereunder and (y) allow the Loans remaining outstanding hereunder after giving effect to such payment to be held by the Lenders hereunder ratably in proportion to their several Commitments.

     11.22 USA PATRIOT Act Notice. Each Lender that is subject to the Act (as hereinafter defined), the Agent and the Co-Administrative Agent (each for itself and not on behalf of any Lender) hereby notifies the Company that pursuant to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “Act”), it is required to obtain, verify and record information that identifies the Company, which information includes the name and address of the Company and other information that will allow such Lender, the Agent or the Co-Administrative Agent, as applicable, to identify the Company in accordance with the Act.

[signature pages follow]

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     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed and delivered in Chicago, Illinois by their proper and duly authorized officers as of the day and year first above written.

	REGIS CORPORATION
	By:
	Title:
Third Amended and Restated Credit Agreement

	BANK OF AMERICA, N.A., as Administrative Agent
	By:
	Title:
	BANK OF AMERICA, N.A., as Issuer and a Lender
	By:
	Title:
Third Amended and Restated Credit Agreement

	LASALLE BANK NATIONAL ASSOCIATION, as Co-Administrative Agent, as Issuer, as a Lender and as Swing Line Lender
	By:
	Title:
Third Amended and Restated Credit Agreement

	JPMORGAN CHASE BANK, N.A. (successor by merger to Bank One, NA), as Syndication Agent and a Lender
	By:
	Title:
Third Amended and Restated Credit Agreement

	WACHOVIA BANK, NATIONAL ASSOCIATION, as Documentation Agent and a Lender
	By:
	Title:
Third Amended and Restated Credit Agreement

	WELLS FARGO BANK, NATIONAL ASSOCIATION, as a Lender
	By:
	Title:
Third Amended and Restated Credit Agreement

	THE BANK OF TOKYO-MITSUBISHI, LTD., as a Lender
	By:
	Title:
Third Amended and Restated Credit Agreement

	U.S. BANK NATIONAL ASSOCIATION, as a Lender
	By:
	Title:
Third Amended and Restated Credit Agreement

SUNTRUST BANK, as a Lender

By:

Title:

Third Amended and Restated Credit Agreement

SCHEDULE 1.01

EXISTING LETTERS OF CREDIT

ABN AMRO L/C #	BENEFICIARY		AMOUNT
S532292	Standard Bank of Africa	$		120,000
S552682	Lexington Building Co.	$		123,750
S541357	Atlantic Mutual Insurance Co.	$		6,390,452
S541344	Hartford Fire Insurance Co.	$		22,711,596

Other – Various Jean Louis David Lessors
303 Park Avenue South Associates	$	30,000
Roosevelt Hotel Corporation N.V.	$	78,750
52nd Lex Co.	$	84,000
505 Fifth Avenue Inc.	$	109,600
AR New York Inc.	$	20,000

SCHEDULE 2.01

COMMITMENTS AND PRO RATA SHARES

Lenders	Commitment		Pro Rata Share
Bank of America, N.A.	$	58,750,000		16.78571	%
LaSalle Bank National Association	$	58,750,000		16.78571	%
JPMorgan Chase Bank, NA	$	40,000,000		11.42857	%
Wachovia Bank, National Association	$	40,000,000		11.42857	%
Wells Fargo Bank, National Association	$	40,000,000		11.42857	%
SunTrust Bank	$	40,000,000		11.42857	%
The Bank of Tokyo-Mitsubishi, Ltd.	$	40,000,000		11.42857	%
U.S. Bank National Association	$	32,500,000		9.28573	%
TOTAL	$	350,000,000		100	%

SCHEDULE 6.11

FINANCIAL CONDITION

None.

SCHEDULE 6.12

ENVIRONMENTAL MATTERS

None.

SCHEDULE 6.17

SUBSIDIARIES

Subsidiaries of		% Ownership
Regis Corporation	Jurisdiction	Structure
1. The Barbers, Hairstyling for Men & Women, Inc.	Minnesota	100.00% Regis Corporation
A. WCH, Inc.*	Minnesota	100.00% The Barbers, Hairstyling for
		Men & Women, Inc.
1. We Care Hair Realty, Inc.*	Delaware	100.00% WCH, Inc.
2. Supercuts, Inc.	Delaware	100% Regis Corporation
A. Supercuts Corporate Shops, Inc.	Delaware	100% Supercuts, Inc.
B. Super Rico, Inc.	Puerto Rico	100% Supercuts, Inc.
C. Tulsa’s Best Haircut LLC	Oklahoma	50% Supercuts, Inc.
3. RPC Acquisition Corp.	Minnesota	100.00% Regis Corporation
4. Regis Corp.	Minnesota	100.00% Regis Corporation
5. Regis Insurance Group, Inc.	Vermont	100.00% Regis Corporation
6. Trade Secret, Inc.	Colorado	100.00% Regis Corporation
7. Regis, Inc.	Minnesota	100.00% Regis Corporation
8. First Choice Haircutters International Corp.	Delaware	100.00% Regis Corporation
9. Cutco Acquisition Corp.	Minnesota	100.00% Regis Corporation
A. 10 Inactive Subsidiaries *		100.00% Cutco Acquisition Corp.
10. Regis International Ltd.	Minnesota	100.00% Regis Corporation
A. Regis Europe, Ltd *	United Kingdom	100.00% Regis International Ltd
1. Essanelle Ltd *	United Kingdom	100.00% Regis Europe Ltd.
B. Blinkers Group, Ltd	United Kingdom	100.00% Regis International Ltd
1. Blinkers Property, Ltd	United Kingdom	100.00% Blinkers Group, Ltd
11. N.A.H.C. Acquisition LLC*	Minnesota	100.00% Regis Corporation
12. Regis Hairstylists, Ltd	Yukon	100.00% Regis Corporation
A. First Choice Haircutters, Ltd	Yukon	100.00% Regis Hairstylists, Ltd
1. First Choice Haircutters Realty, Inc. *	Canada Federal	100.00% First Choice Haircutters, Ltd.
B. Magicuts Zee, Inc.	Yukon	100.00% Regis Hairstylists, Ltd
C. Mission Enterprises, Inc.*	Ontario	100.00% Regis Hairstylists, Ltd
13. Regis Cuts Acquisition Corp.	Nova Scotia	100.00% Regis Corporation
14. Daljit Ltd	Delaware	100.00% Regis Corporation
A. 11 US Subsidiaries in New York City		100.00% Daljit Ltd
15. Mary Lentine School of Hair Design, Inc.	Massachusetts	100.00% Regis Corporation
16. Melrose Beauty Academy, Inc.	Massachusetts	100.00% Regis Corporation

Subsidiaries of		% Ownership
Regis Corporation	Jurisdiction	Structure
17. 5 Inactive Subsidiaries *	Massachusetts	100.00% Regis Corporation
17. Bernett-Anthony Beauty Corporation	New Jersey	100.00% Regis Corporation
18. Concorde School of Hair Design, Inc.	New Jersey	100.00% Regis Corporation
19. European Academy of Cosmetology, Inc.	New Jersey	100.00% Regis Corporation
20. Accredited School of Cosmetology, Inc.	Minnesota	100.00% Regis Corporation
21. Scot-Lewis School – Crystal, Inc.	Minnesota	100.00% Regis Corporation
22. First Par Management Corp.	Rhode Island	100.00% Regis Corporation
A. Arthur Angelo School of Cosmetology and HairDesign, Inc.	Rhode Island	100.00% First Par Management Corp.
23. Hair Club Group, Inc.	Canada Federal	100.00% Regis Corporation
24. HC (USA), Inc.	Delaware	100.00% Regis Corporation
A. HCM USA, Inc.	Delaware	100.00% HC (USA), Inc.
1. HCM Industries, Inc.	Florida	100.00% HCM USA, Inc.
2. HCM Management LLC	Delaware	100.00% HCM USA, Inc.
3. Hair Club for Men, Ltd., Inc.	Florida	100.00% HCM USA, Inc.
a. HCFM, LLC	Delaware	100.00% Hair Club for Men, Ltd., Inc.
b. Hair Club for Men, LLC	Delaware	100.00% Hair Club for Men, Ltd., Inc.
c. Hair Club Management Company, LLC	Delaware	100.00% Hair Club for Men, Ltd., Inc.
d. HCA Advertising Services, Inc.	New York	100.00% Hair Club for Men, Ltd., Inc.
e. Hair Club for Men, Ltd	Delaware	100.00% Hair Club for Men, Ltd., Inc.
f. 3115038 Canada, Inc.	Canada Federal	100.00% Hair Club for Men, Ltd., Inc.
g. Hair Club for Men, Ltd	Illinois	50.00% Hair Club for Men, Ltd., Inc.
h. Hair Club for Men of Milwaukee, Ltd	Wisconsin	50.00% Hair Club for Men, Ltd., Inc.
25. Regis Netherlands, Inc.	Minnesota	100.00% Regis Corporation
26. RHS Netherlands CV	Netherlands	1.00% Regis Corporation
		89.00% Regis Netherlands, Inc.
		10.00% Regis International Ltd
A. RHS Netherlands Finance B.V.	Netherlands	100.00% RHS Netherlands CV
B. RHS Netherlands Holdings B.V.	Netherlands	100.00% RHS Netherlands CV
1. Supercuts UK Limited	United Kingdom	100.00% RHS Netherlands Holdings BV
a. 37 Inactive Subsidiaries*	United Kingdom	100.00% Supercuts UK Limited
2. RHS France SAS	France	100.00% RHS Netherlands Holdings BV
a. Jean Louis David France SAS	France	100.00% RHS France SAS
i. Jean Louis David France Salons SARL	France	100.00% Jean Louis David France SAS
b. Saint Algue France SAS	France	100.00% RHS France SAS
i. GIE Regis France SARL	France	100.00% Saint Algue France SAS
ii. Saint Algue France Salons SARL	France	100.00% Saint Algue France SAS
iii. KFI SAS	France	100.00% Saint Algue France SAS
A. 15 Subsidiaries	France	100.00% KFI SAS

* Inactive Entities

SCHEDULE 8.01

PERMITTED LIENS

Regis Corporation

Regis Corporation and certain Subsidiaries have granted numerous liens in favor of Information Leasing Corporation (a/k/a Information Leasing Corp.) with respect to various salon and warehouse equipment and the Salt Lake Distribution Center. The combined amount outstanding secured by such liens is approximately $28.5 million.

In addition, the following UCC financing statements have been filed with the Minnesota Secretary of State’s office with respect to Regis Corporation:

•   Number 2211705 in favor of Steelcase Financial Services Inc.

•   Number 2298738 in favor of Pitney Bowes Credit Corp.

•   Number 20025242846 in favor of Equilease Financial Services Inc.

•   Number 20036264225 in favor of The Huntington National Bank (as assignee of Information Leasing Corporation)

•   Number 20037146639 in favor of IOS Capital LLC.

•   Number 200410755149 in favor of Weingarten Nostat Inc.

•   Number 200413100402 in favor of Canon Financial Services, Inc.

•   Number 200414190427 in favor of Canon Financial Services, Inc.

•   Number 200514629313 in favor of National City Commercial Capital Corporation.

•   Number 200514714925 in favor of Canon Financial Services, Inc.

•   Number 200514815880 in favor of National City Commercial Capital Corporation.

•   Number 200514994391 in favor of National City Commercial Capital Corporation.

•   Number 200515266638 in favor of National City Commercial Capital Corporation.

•   Number 200515329147 in favor of National City Commercial Capital Corporation.

•   Number 200515509296 in favor of Canon Financial Services, Inc.

The collateral for the Weingarten filing is essentially all assets located at one location, and we believe it secures the obligations under the lease for such premises.

The Huntington filing is as assignee of Information Leasing Corporation.

The National City filings are now part of the Information Leasing Corporation relationship (they are somehow affiliated or may have merged) and are included in the $28.5 million referred to above.

The collateral for all of the other filings are specific equipment provided by such parties, and the aggregate amount owing to all such parties is less than $1 million.

The Barbers, Hairstyling for Men and Women

          The following UCC financing statements have been filed with the Minnesota Secretary of State’s office with respect to this entity:

•   Number 20024755905 in favor of Avent Ferry Associates Limited

•   Number 200413993508 in favor of Hippo Partners 04, Ltd.

The collateral for each such filing is essentially all assets located at one location per financing statement, and we believe each secures the obligations of this entity under the lease for such premises.

Supercuts, Inc.

	The following UCC financing statements have been filed with the Delaware Secretary of State’s office with respect to this entity:
•	Number 22177664 in favor of Vestar California XXIII, L.L.C.
•	Number 32325234 in favor of Washington Place, LP
•	Number 41569765 in favor of Vestar Arizona XXXI, L.L.C.
•	Number 42955617 in favor of Vestar California XXII, L.L.C.

The collateral for each such filing is essentially all assets located at one location per financing statement, and we believe each secures the obligations of this entity under the lease for such premises.

Trade Secret, Inc.

	The following UCC financing statement has been filed with the Colorado Secretary of State’s office with respect to this entity:
•	Number 20042051284 in favor of Vestar California XXIII, L.L.C.

The collateral for this filing is essentially all assets located at one location in Arizona, and we believe it secures the obligations of this entity under the lease for such premises.

Supercuts Corporate Shops, Inc.

	The following UCC financing statement has been filed with the Delaware Secretary of State’s office with respect to this entity:
•	Number 23111535 in favor of La Carina Supercuts, Inc.

The collateral for this filing is essentially all assets located at six Supercuts locations, and secures the payment obligation to the franchisee from whom the locations were repurchased. The aggregate amount owning is less than $600,000 and is all due within the next few years.

SCHEDULE 8.04

INVESTMENTS

None.

SCHEDULE 8.05

EXISTING DEBT

Senior Notes

Amount	Rate	Due
$10,000,000	6.94%	07/01/05
$22,000,000	7.80%	07/01/06
$8,000,000	8.18%	07/02/06
$2,000,000	7.48%	07/02/06
$14,000,000	7.14%	07/02/08
$25,000,000	8.39%	10/03/10
$30,000,000	4.69%	06/09/13
$10,000,000	6.83%	12/31/05
$40,000,000	4.03%	11/30/07
$30,000,000	4.65%	11/30/09
$30,000,000	4.86%	11/30/10
$58,000,000	6.73%	03/15/09
$67,000,000	7.20%	03/15/12
$30,000,000	4.97%	03/31/13
$70,000,000	5.20%	03/31/15
$70,000,000	LIBOR + 0.52%	03/31/13
$30,000,000	LIBOR + 0.55%	03/31/15

Syndicated Revolving Credit Facilities
Amount	Rate	Due
$11,725,000 1	LIBOR + 0.875%	11/12/06

Other Debt
ILC Leases	$	17,883,392
ILC Salt Lake City Lake City Mortgage	$	10,101,152
Other (including acquired)	$	1,782,023

Other Contingent Obligations
Guarantees for leases on behalf of Franchisees (NPV) $2,045,263

¹As of April 7, 2005 on a proforma basis

SCHEDULE 11.02

LENDING OFFICES; ADDRESS FOR NOTICES

[Lender information forthcoming]

Company

Regis Corporation
7201 Metro Boulevard
Edina, Minnesota 55349
Attention: Director of Treasury

EX-99.2

EXHIBIT 99.2

EXECUTION COPY

REGIS CORPORATION

MASTER NOTE PURCHASE AGREEMENT

Dated as of March 15, 2005

$400,000,000 Aggregate Principal Amount
Senior Notes Issuable in Series

Initial Issuance of
$30,000,000 4.97% Senior Notes, Series 2005-A, Tranche 1, due March 31, 2013
$70,000,000 5.20% Senior Notes, Series 2005-A, Tranche 2, due March 31, 2015
$70,000,000 Floating Rate Senior Notes, Series 2005-B, Tranche 1, due March 31, 2013
$30,000,000 Floating Rate Senior Notes, Series 2005-B, Tranche 2, due March 31, 2015

Series A, Tranche 1, PPN: 758932 F# 9

Series A, Tranche 2, PPN: 758932 G* 2

Series B, Tranche 1, PPN: 758932 G@ 0

Series B, Tranche 2, PPN: 758932 G# 8

TABLE OF CONTENTS

Section				Page
1.	AUTHORIZATION OF NOTES				1
		1.1.	Description of Notes		1
		1.2.	Additional Series of Notes		2
		1.3.	Subsidiary Guaranty; Release		2
		1.4.	Floating Interest Rate Provisions for Floating Rate Notes		3
2.	SALE AND PURCHASE OF NOTES				4
3.	CLOSING				4
4.	CONDITIONS TO CLOSING				5
		4.1.	Representations and Warranties		5
		4.2.	Performance; No Default		5
		4.3.	Compliance Certificates		5
		4.4.	Opinions of Counsel		6
		4.5.	Purchase Permitted By Applicable Law, etc.		6
		4.6.	Sale of Other Notes		6
		4.7.	Payment of Special Counsel Fees		6
		4.8.	Private Placement Numbers		6
		4.9.	Changes in Corporate Structure		7
		4.10.	Subsidiary Guaranty		7
		4.11.	Intercreditor Agreement		7
		4.12.	Funding Instructions		7
		4.13.	Proceedings and Documents		7
5.	REPRESENTATIONS AND WARRANTIES OF THE COMPANY				7
		5.1.	Organization; Power and Authority		7
		5.2.	Authorization, etc.		8
		5.3.	Disclosure		8
		5.4.	Organization and Ownership of Shares of Subsidiaries; Affiliates		9
		5.5.	Financial Statements		9
		5.6.	Compliance with Laws, Other Instruments, etc.		10
		5.7.	Governmental Authorizations, etc.		10
		5.8.	Litigation; Observance of Statutes and Orders		10
		5.9.	Taxes		11
		5.10.	Title to Property; Leases		11
		5.11.	Licenses, Permits, etc.		11
		5.12.	Compliance with ERISA		12
		5.13.	Private Offering by the Company		13
		5.14.	Use of Proceeds; Margin Regulations		13
		5.15.	Existing Debt		13
		5.16.	Foreign Assets Control Regulations, etc.		14

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Section			Page
	5.17.	Status under Certain Statutes		14
	5.18.	Environmental Matters		14
	5.19.	Solvency of Subsidiary Guarantors		15
	5.20.	Pari Passu Ranking		15
6.	REPRESENTATIONS OF THE PURCHASERS			15
	6.1.	Purchase for Investment		15
	6.2.	Source of Funds		15
7.	INFORMATION AS TO COMPANY			17
	7.1.	Financial and Business Information		17
	7.2.	Officer’s Certificate		20
	7.3.	Visitation		20
8.	PREPAYMENT OF THE NOTES			21
	8.1.	No Scheduled Prepayments		21
	8.2.	Optional Prepayments		21
	8.3.	Allocation of Partial Prepayments		22
	8.4.	Maturity; Surrender, etc.		22
	8.5.	Purchase of Notes		22
	8.6.	Make-Whole Amount		23
	8.7.	LIBOR Breakage Amount		24
9.	AFFIRMATIVE COVENANTS			24
	9.1.	Compliance with Law		24
	9.2.	Insurance		25
	9.3.	Maintenance of Properties		25
	9.4.	Payment of Taxes and Claims		25
	9.5.	Corporate Existence, etc.		25
	9.6.	Additional Subsidiary Guarantors		26
	9.7.	Ranking		26
	9.8.	Books and Records		26
10.	NEGATIVE COVENANTS			26
	10.1.	Consolidated Net Worth		27
	10.2.	Consolidated Net Debt		27
	10.3.	Fixed Charge Coverage		27
	10.4.	Priority Debt		27
	10.5.	Liens		27
	10.6.	Sale of Assets		29
	10.7.	Mergers, Consolidations, etc.		29
	10.8.	Disposition of Stock of Restricted Subsidiaries		30
	10.9.	Designation of Restricted and Unrestricted Subsidiaries		31
	10.10.	Transactions with Affiliates		31
11.	EVENTS OF DEFAULT			31
12.	REMEDIES ON DEFAULT, ETC.			34

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Section			Page
	12.1.	Acceleration		34
	12.2.	Other Remedies		34
	12.3.	Rescission		35
	12.4.	No Waivers or Election of Remedies, Expenses, etc.		35
13.	REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES			35
	13.1.	Registration of Notes		35
	13.2.	Transfer and Exchange of Notes		36
	13.3.	Replacement of Notes		36
14.	PAYMENTS ON NOTES			36
	14.1.	Place of Payment		36
	14.2.	Home Office Payment		37
15.	EXPENSES, ETC.			37
	15.1.	Transaction Expenses		37
	15.2.	Survival		38
16.	SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT			38
17.	AMENDMENT AND WAIVER			38
	17.1.	Requirements		38
	17.2.	Solicitation of Holders of Notes		38
	17.3.	Binding Effect, etc.		39
	17.4.	Notes held by Company, etc.		39
18.	NOTICES			39
19.	REPRODUCTION OF DOCUMENTS			40
20.	CONFIDENTIAL INFORMATION			40
21.	SUBSTITUTION OF PURCHASER			41
22.	MISCELLANEOUS			42
	22.1.	Successors and Assigns		42
	22.2.	Payments Due on Non-Business Days		42
	22.3.	Accounting Terms		42
	22.4.	Severability		42
	22.5.	Construction		42
	22.6.	Counterparts		43
	22.7.	Governing Law		43
	22.8.	Jurisdiction and Process; Waiver of Jury Trial		43

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SCHEDULE A	—	Information Relating to Purchasers
SCHEDULE B	—	Defined Terms
SCHEDULE 4.9	—	Changes in Corporate Structure
SCHEDULE 5.3	—	Disclosure Materials
SCHEDULE 5.4	—	Subsidiaries; Affiliates
SCHEDULE 5.5	—	Financial Statements
SCHEDULE 5.14	—	Use of Proceeds
SCHEDULE 5.15	—	Existing Debt
SCHEDULE 10.4	—	Liens
EXHIBIT 1.1(a)	—	Form of Series 2005-A, Tranche 1, Senior Note
EXHIBIT 1.1(b)	—	Form of Series 2005-A, Tranche 2, Senior Note
EXHIBIT 1.1(c)	—	Form of Series 2005-B, Tranche 1, Senior Note
EXHIBIT 1.1(d)	—	Form of Series 2005-B, Tranche 2, Senior Note
EXHIBIT 1.2	—	Form of Supplement
EXHIBIT 1.3	—	Form of Subsidiary Guaranty
EXHIBIT 4.4(a)	—	Form of Opinion of Counsel for the Company
EXHIBIT 4.4(b)	—	Form of Opinion of Special Counsel for the Purchasers

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REGIS CORPORATION
7201 Metro Boulevard
Edina, MN 55439
(952) 947-7777
Fax: (952) 947-7700

$400,000,000 Aggregate Principal Amount
Senior Notes Issuable in Series

$30,000,000 4.97% Senior Notes, Series 2005-A, Tranche 1, due March 31, 2013
$70,000,000 5.20% Senior Notes, Series 2005-A, Tranche 2, due March 31, 2015
$70,000,000 Floating Rate Senior Notes, Series 2005-B, Tranche 1, due March 31, 2013
$30,000,000 Floating Rate Senior Notes, Series 2005-B, Tranche 2, due March 31, 2015

Dated as of March 15, 2005

TO EACH OF THE PURCHASERS LISTED IN
THE ATTACHED SCHEDULE A:

Ladies and Gentlemen:

          REGIS CORPORATION, a Minnesota corporation (the “Company”), agrees with you as follows:

1. AUTHORIZATION OF NOTES.

1.1. Description of Notes.

          The Company has authorized the issue and sale of: $30,000,000 aggregate principal amount of its 4.97% Senior Notes, Series 2005-A, Tranche 1, due March 31, 2013 (the “Series 2005-A, Tranche 1, Notes”); $70,000,000 aggregate principal amount of its 5.20% Senior Notes, Series 2005-A, Tranche 2, due March 31, 2015 (the “Series 2005-A, Tranche 2, Notes” and together with the Series 2005-A, Tranche 1, Notes, the “Series 2005-A Notes”); $70,000,000 aggregate principal amount of its Floating Rate Senior Notes, Series 2005-B, Tranche 1, due March 31, 2013 (the “Series 2005-B, Tranche 1, Notes”); and $30,000,000 aggregate principal amount of its Floating Rate Senior Notes, Series 2005-B, Tranche 2, due March 31, 2015 (the “Series 2005-B, Tranche 2, Notes” and together with the Series 2005-B, Tranche 1, Notes, the “Series 2005-B Notes”). The Series 2005-A Notes and the Series 2005-B, Notes are referred to collectively as the “Series 2005 Notes”. The Series 2005 Notes shall be substantially in the forms set out in Exhibits 1.1(a), (b), (c) and (d), with such changes therefrom, if any, as may be approved by the Purchasers and the Company. Certain capitalized terms used in this Agreement are defined in Schedule B; references to a “Schedule” or an “Exhibit” are, unless otherwise specified, to a Schedule or an Exhibit attached to this Agreement.

1.2. Additional Series of Notes.

          In addition to the issuance and sale of the Series 2005 Notes, the Company may from time to time issue and sell one or more additional series of notes (the “Additional Notes” and together with the Series 2005 Notes, the “Notes,” such term to include any such Notes issued in substitution therefor pursuant to Section 13 of this Agreement) pursuant to this Agreement, provided that the aggregate principal amount of all Notes issued pursuant to this Agreement shall not exceed $400,000,000. Each series of Additional Notes will be issued pursuant to a supplement to this Agreement (a “Supplement”) in substantially the form of Exhibit 1.2, and will be subject to the following terms and conditions:

     (a) the designation of each series of Additional Notes shall distinguish such series from the Notes of all other series;

     (b) each series of Additional Notes may consist of different and separate tranches and may differ as to outstanding principal amounts, maturity dates, interest rates and premiums or make-whole amounts, if any, and price and terms of redemption or payment prior to maturity;

     (c) all Notes issued under this Agreement, including pursuant to any Supplement, shall rank pari passu with each other and shall constitute Senior Debt;

     (d) each series of Additional Notes shall be dated the date of issue, bear interest at such rate or rates, mature on such date or dates, be subject to such mandatory or optional prepayments, if any, on the dates and with the make-whole amounts, premiums or breakage amounts, if any, as are provided in the Supplement under which such Additional Notes are issued, and shall have such additional or different conditions precedent to closing and such additional or different representations and warranties or, subject to Section 1.2(e), other terms and provisions as shall be specified in such Supplement;

     (e) any additional or more restrictive covenants, Defaults, Events of Default, rights or similar provisions that are added by a Supplement for the benefit of the series of Notes to be issued pursuant to such Supplement shall apply to all outstanding Notes, whether or not the Supplement so provides; and

     (f) except to the extent provided in foregoing clause (d), all of the provisions of this Agreement shall apply to all Additional Notes.

1.3. Subsidiary Guaranty; Release.

     (a) Subsidiary Guaranty. The payment by the Company of all amounts due on or in respect to the Notes and the performance by the Company of its obligations under this Agreement will be guaranteed by each Subsidiary that is or in the future becomes a signatory to the Bank Guaranty, a borrower under the Credit Agreement or a guarantor of any Debt outstanding under the Private Shelf Agreement (individually, a “Subsidiary Guarantor” and collectively, the “Subsidiary Guarantors”) pursuant to the

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Subsidiary Guaranty in substantially the form of the attached Exhibit 1.3 (as it may be amended or supplemented from time to time the “Subsidiary Guaranty”).

     (b) Release of Subsidiary Guaranty. Each holder of a Note acknowledges and agrees that each Subsidiary Guarantor shall be fully released and discharged from the Subsidiary Guaranty, and each holder of a Note fully releases and discharges such Subsidiary Guarantor from the Subsidiary Guaranty, immediately and without any further act, upon such Subsidiary being released and discharged as guarantor under and in respect of the Credit Agreement; provided that (i) no Default or Event of Default exists or will exist immediately following such release and discharge; (ii) if any fee or other consideration is paid or given to any holder of Indebtedness under the Credit Agreement expressly for the purpose of such release, other than consideration of $5,000 or less per holder or the repayment of all or a portion of such Debt under the Credit Agreement, each holder of a Note receives equivalent consideration on a pro rata basis; and (iii) at the time of such release and discharge, the Company delivers to each holder of Notes a certificate of a Responsible Officer certifying that such Subsidiary Guarantor has been or is being released and discharged as a guarantor under and in respect of the Credit Agreement and the matters set forth in clauses (i) and (ii).

1.4.   Floating Interest Rate Provisions for Floating Rate Notes.

     (a) Adjusted LIBOR Rate. “Adjusted LIBOR Rate” means, for each Interest Period, the rate per annum equal to LIBOR for such Interest Period plus the percentage applicable to a series or tranche of floating rate Notes. The percentage applicable to each tranche of Series 2005-B Notes is set forth below:

Series 2005-B Notes	Applicable Percentage
Tranche 1		0.52	%
Tranche 2		0.55	%

For purposes of determining Adjusted LIBOR Rate, the following terms have the following meanings:

     “LIBOR” means, for any Interest Period, the rate per annum (rounded upwards, if necessary, to the next higher one hundred-thousandth of a percentage point) for deposits in U.S. Dollars for a 3-month period (or such other period as is specified in the applicable Supplement) that appears on the Bloomberg Financial Markets Service Page BBAM-1 (or if such page is not available, the Reuters Screen LIBO Page) as of 11:00 a.m. (London, England time) on the date two Business Days before the commencement of such Interest Period (or three Business Days before the commencement of the first Interest Period).

     “Reuters Screen LIBO Page” means the display designated as the “LIBO” page on the Reuters Monitory Money Rates Service (or such other page as may replace the LIBO page on that service) or such other service as may be nominated by the British Bankers’ Association as the information vendor for the

3

purpose of displaying British Bankers’ Association Interest Settlement Rates for U.S. Dollar deposits.

     (b) Determination of the Adjusted LIBOR Rate. The Adjusted LIBOR Rate shall be determined by the Company, and notice thereof shall be given to the holders of the applicable series or tranche of floating rate Notes, within two Business Days after the beginning of each Interest Period, together with (i) a copy of the relevant screen used for the determination of LIBOR, (ii) a calculation of the Adjusted LIBOR Rate for such Interest Period, (iii) the number of days in such Interest Period, (iv) the date on which interest for such Interest Period will be paid and (v) the amount of interest to be paid to each holder of Notes of such series or tranche on such date. If the holders of a majority in principal amount of the Notes of such series or tranche outstanding do not concur with such determination by the Company, as evidenced by a single written notice delivered to the Company within 10 Business Days after receipt by such holders of the notice delivered by the Company pursuant to the immediately preceding sentence, the determination of the Adjusted LIBOR Rate shall be made by such holders of the Notes, and any such determination made in accordance with the provisions of this Agreement shall be conclusive and binding absent manifest error.

     (c) Interest Period. “Interest Period” means for any series or tranche of floating rate Notes and for any period for which interest is to be calculated or paid, the period commencing on an interest payment date for such series or tranche of floating rate Notes, or on the date of Closing in the case of the first such period, and continuing up to, but not including, the next interest payment date. The interest payment dates for the Series 2005-B Notes are March 31, June 30, September 30 and December 31.

2.   SALE AND PURCHASE OF NOTES.

          Subject to the terms and conditions of this Agreement, the Company will issue and sell to you and each of the other purchasers named in Schedule A (the “Other Purchasers”), and you and the Other Purchasers will purchase from the Company, at the Closing provided for in Section 3, Notes in the principal amount specified opposite your names in Schedule A at the purchase price of 100% of the principal amount thereof. Your obligation hereunder and the obligations of the Other Purchasers are several and not joint obligations and you shall have no liability to any Person for the performance or non-performance by any Other Purchaser hereunder.

3.   CLOSING.

          The sale and purchase of the Series 2005 Notes to be purchased by you and the Other Purchasers shall occur at the offices of Gardner Carton & Douglas LLP, 191 N. Wacker Drive, Suite 3700, Chicago, Illinois 60606 at 9:00 a.m., Chicago time, at a closing (the “Closing”) on March 31, 2005 or on such other Business Day thereafter on or prior to April 15, 2005 as may be agreed upon by the Company and you and the Other Purchasers. At the Closing the Company will deliver to you the Notes to be purchased by you in the form of a single Series 2005 Note (or such greater number of Notes in denominations of at least $100,000 as you may request) dated the date of the Closing and registered in your name (or in the name of your

4

nominee), against delivery by you to the Company or its order of immediately available funds in the amount of the purchase price therefor by wire transfer of immediately available funds for the account of the Company to account number 2347093, at LaSalle National Bank, 135 South LaSalle Street, Chicago, IL 60603, ABA #071000505. If at the Closing the Company fails to tender such Notes to you as provided above in this Section 3, or any of the conditions specified in Section 4 shall not have been fulfilled to your satisfaction, you shall, at your election, be relieved of all further obligations under this Agreement, without thereby waiving any rights you may have by reason of such failure or such nonfulfillment.

4.   CONDITIONS TO CLOSING.

          Your obligation to purchase and pay for the Notes to be sold to you at the Closing is subject to the fulfillment to your satisfaction, prior to or at the Closing, of the following conditions:

4.1.   Representations and Warranties.

     (a) Representations and Warranties of the Company. The representations and warranties of the Company in this Agreement shall be correct when made and at the time of the Closing.

     (b) Representations and Warranties of the Subsidiary Guarantors. The representations and warranties of each Subsidiary Guarantor in the Subsidiary Guaranty shall be correct when made and at the time of the Closing.

4.2.   Performance; No Default.

          The Company shall have performed and complied with all agreements and conditions contained in this Agreement required to be performed or complied with by it prior to or at the Closing and after giving effect to the issue and sale of the Series 2005 Notes (and the application of the proceeds thereof as contemplated by Schedule 5.14) no Default or Event of Default shall have occurred and be continuing. Neither the Company nor any Subsidiary shall have entered into any transaction since the date of the Memorandum that would have been prohibited by Section 10 hereof had such Section applied since such date.

4.3.   Compliance Certificates.

     (a) Certificate of Officer of the Company. The Company shall have delivered to you an Officer’s Certificate, dated the date of the Closing, certifying that the conditions specified in Sections 4.1, 4.2 and 4.9 have been fulfilled.

     (b) Certificate of Secretary of the Company. The Company shall have delivered to you a certificate certifying as to the resolutions attached thereto and other corporate proceedings relating to the authorization, execution and delivery of the Notes and the Agreement.

     (c) Certificate of Secretary of Each Subsidiary. Each Subsidiary shall have delivered to you a certificate certifying as to the resolutions attached thereto and other

5

corporate proceedings relating to the authorization, execution and delivery of the Subsidiary Guaranty.

4.4.   Opinions of Counsel.

          You shall have received opinions in form and substance satisfactory to you, dated the date of the Closing (a) from Eric Bakken, Vice President and General Counsel for the Company, covering the matters set forth in Exhibit 4.4(a) and covering such other matters incident to the transactions contemplated hereby as you or your counsel may reasonably request (and the Company instructs its counsel to deliver such opinion to you) and (b) from Gardner Carton & Douglas LLP, your special counsel in connection with such transactions, substantially in the form set forth in Exhibit 4.4(b) and covering such other matters incident to such transactions as you may reasonably request.

4.5.   Purchase Permitted By Applicable Law, etc.

          On the date of the Closing your purchase of Notes shall (i) be permitted by the laws and regulations of each jurisdiction to which you are subject, without recourse to provisions (such as Section 1405(a)(8) of the New York Insurance Law) permitting limited investments by insurance companies without restriction as to the character of the particular investment, (ii) not violate any applicable law or regulation (including, without limitation, Regulation U, T or X of the Board of Governors of the Federal Reserve System) and (iii) not subject you to any tax, penalty or liability under or pursuant to any applicable law or regulation, which law or regulation was not in effect on the date hereof. If requested by you, you shall have received an Officer’s Certificate certifying as to such matters of fact as you may reasonably specify to enable you to determine whether such purchase is so permitted.

4.6.   Sale of Other Notes.

          Contemporaneously with the Closing the Company shall sell to the Other Purchasers and the Other Purchasers shall purchase the Notes to be purchased by them at the Closing as specified in Schedule A.

4.7.   Payment of Special Counsel Fees.

          Without limiting the provisions of Section 15.1, the Company shall have paid on or before the Closing the reasonable fees, charges and disbursements of your special counsel referred to in Section 4.4, to the extent reflected in a statement of such counsel rendered to the Company at least one Business Day prior to the Closing (such statement to include reasonable detail as to the basis for such fees, charges and disbursements).

4.8.   Private Placement Numbers.

          A Private Placement Number issued by Standard & Poor’s CUSIP Service Bureau (in cooperation with the Securities Valuation Office of the National Association of Insurance Commissioners) shall have been obtained by Gardner Carton & Douglas LLP for each series or tranche of the Notes.

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4.9.   Changes in Corporate Structure.

          Neither the Company nor any Subsidiary Guarantor shall have changed its jurisdiction of organization or, except as reflected in Schedule 4.9, been a party to any merger or consolidation, or shall have succeeded to all or any substantial part of the liabilities of any other entity, at any time following the date of the most recent financial statements referred to in Schedule 5.5.

4.10.   Subsidiary Guaranty.

          Each Subsidiary Guarantor shall have executed and delivered the Subsidiary Guaranty in favor of you and the Other Purchasers and you shall have received a copy of the executed Subsidiary Guaranty.

4.11.   Intercreditor Agreement.

          You and each of the Other Purchasers shall have become parties to the Intercreditor Agreement.

4.12.   Funding Instructions.

          At least three Business Days prior to the date of the Closing, each Purchaser shall have received written instructions signed by a Responsible Officer on letterhead of the Company confirming the information specified in Section 3 including (i) the name and address of the transferee bank, (ii) such transferee bank’s ABA number and (iii) the account name and number into which the purchase price for the Notes is to be deposited.

4.13.   Proceedings and Documents.

          All corporate and other proceedings in connection with the transactions contemplated by this Agreement and all documents and instruments incident to such transactions shall be satisfactory to you and your special counsel, and you and your special counsel shall have received all such counterpart originals or certified or other copies of such documents as you or they may reasonably request.

5.   REPRESENTATIONS AND WARRANTIES OF THE COMPANY.

          The Company represents and warrants to you that:

5.1.   Organization; Power and Authority.

          The Company is a corporation duly organized, validly existing and in good standing under the laws of its jurisdiction of incorporation, and is duly qualified as a foreign corporation and is in good standing in each jurisdiction in which such qualification is required by law, other than those jurisdictions as to which the failure to be so qualified or in good standing could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. The Company has the corporate power and authority to own or hold under lease the

7

properties it purports to own or hold under lease, to transact the business it transacts and proposes to transact, to execute and deliver this Agreement and the Notes and to perform the provisions hereof and thereof.

5.2.   Authorization, etc.

          This Agreement and the Notes have been duly authorized by all necessary corporate action on the part of the Company, and this Agreement constitutes, and upon execution and delivery thereof each Note will constitute, a legal, valid and binding obligation of the Company enforceable against the Company in accordance with its terms, except as such enforceability may be limited by (i) applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors’ rights generally and (ii) general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law).

          The Subsidiary Guaranty has been duly authorized by all necessary corporate action on the part of each Subsidiary Guarantor and upon execution and delivery thereof will constitute the legal, valid and binding obligation of each Subsidiary Guarantor, enforceable against each Subsidiary Guarantor in accordance with its terms, except as such enforceability may be limited by (i) applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors’ rights generally and (ii) general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law).

5.3.   Disclosure.

          The Company, through its agent, Banc of America Securities LLC, has delivered to you and each Other Purchaser a copy of a Private Placement Memorandum, dated February 2005 (the “Memorandum”), relating to the transactions contemplated hereby. The Memorandum fairly describes, in all material respects, the general nature of the business and principal properties of the Company and its Subsidiaries. This Agreement, the Memorandum, the documents, certificates or other writings identified in Schedule 5.3 delivered to the Purchasers by or on behalf of the Company in connection with the transactions contemplated hereby and the financial statements listed in Schedule 5.5, in each case, delivered to the Purchasers prior to March 7, 2005 (this Agreement, the Memorandum and such documents, certificates or other writings and such financial statements being referred to, collectively, as the “Disclosure Documents”), taken as a whole, do not contain any untrue statement of a material fact or omit to state any material fact necessary to make the statements therein not misleading in light of the circumstances under which they were made. Except as disclosed in the Disclosure Documents, since June 30, 2004, there has been no change in the financial condition, operations, business or properties of the Company or any Subsidiary except changes that individually or in the aggregate could not reasonably be expected to have a Material Adverse Effect. There is no fact known to the Company that could reasonably be expected to have a Material Adverse Effect that has not been set forth Disclosure Documents.

8

5.4.   Organization and Ownership of Shares of Subsidiaries; Affiliates.

     (a) Schedule 5.4 contains (except as noted therein) complete and correct lists of: (i) the Company’s Subsidiaries, showing, as to each Subsidiary, the correct name thereof, the jurisdiction of its organization, the percentage of shares of each class of its capital stock or similar equity interests outstanding owned by the Company and each other Subsidiary, (ii) the Company’s Affiliates, other than Subsidiaries, and (iii) the Company’s directors and senior officers. Each Subsidiary listed in Schedule 5.4 is designated a Restricted Subsidiary by the Company.

     (b) All of the outstanding shares of capital stock or similar equity interests of each Subsidiary shown in Schedule 5.4 as being owned by the Company and its Subsidiaries have been validly issued, are fully paid and nonassessable and are owned by the Company or another Subsidiary free and clear of any Lien (except as otherwise disclosed in Schedule 5.4).

     (c) Each Subsidiary identified in Schedule 5.4 is a corporation or other legal entity duly organized, validly existing and in good standing under the laws of its jurisdiction of organization, and is duly qualified as a foreign corporation or other legal entity and is in good standing in each jurisdiction in which such qualification is required by law, other than those jurisdictions as to which the failure to be so qualified or in good standing could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. Each such Subsidiary has the corporate or other power and authority to own or hold under lease the properties it purports to own or hold under lease and to transact the business it transacts and proposes to transact.

     (d) No Subsidiary is a party to, or otherwise subject to, any legal restriction or any agreement (other than this Agreement, the agreements listed on Schedule 5.4 and customary limitations imposed by corporate law statutes) restricting the ability of such Subsidiary to pay dividends out of profits or make any other similar distributions of profits to the Company or any of its Subsidiaries that owns outstanding shares of capital stock or similar equity interests of such Subsidiary.

5.5.   Financial Statements.

          The Company has delivered to you and each Other Purchaser copies of the financial statements of the Company and its Subsidiaries listed on Schedule 5.5. All of said financial statements (including in each case the related schedules and notes) fairly present in all material respects the consolidated financial position of the Company and its Subsidiaries as of the respective dates specified in such Schedule and the consolidated results of their operations and cash flows for the respective periods so specified and have been prepared in accordance with GAAP consistently applied throughout the periods involved except as set forth in the notes thereto (subject, in the case of any interim financial statements, to normal year-end adjustments). The Company and its Subsidiaries do not have any Material liabilities that are not disclosed on such financial statements or otherwise disclosed in the Disclosure Documents.

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5.6.   Compliance with Laws, Other Instruments, etc.

          The execution, delivery and performance by the Company of this Agreement, the Intercreditor Agreement and the Notes will not (i) contravene, result in any breach of, or constitute a default under, or result in the creation of any Lien in respect of any property of the Company or any Subsidiary under, any indenture, mortgage, deed of trust, loan, purchase or credit agreement, lease, corporate charter or by-laws, or any other agreement or instrument to which the Company or any Subsidiary is bound or by which the Company or any Subsidiary or any of their respective properties may be bound or affected, (ii) conflict with or result in a breach of any of the terms, conditions or provisions of any order, judgment, decree, or ruling of any court, arbitrator or Governmental Authority applicable to the Company or any Subsidiary or (iii) violate any provision of any statute or other rule or regulation of any Governmental Authority, including the USA Patriot Act, applicable to the Company or any Subsidiary.

          The execution, delivery and performance by each Subsidiary Guarantor of the Subsidiary Guaranty will not (i) contravene, result in any breach of, or constitute a default under, or result in the creation of any Lien in respect of any property of such Subsidiary Guarantor under any indenture, mortgage, deed of trust, loan, purchase or credit agreement, lease, corporate charter or by-laws, or any other agreement or instrument to which such Subsidiary Guarantor is bound or by which such Subsidiary Guarantor or any of its properties may be bound or affected, (ii) conflict with or result in a breach of any of the terms, conditions or provisions of any order, judgment, decree, or ruling of any court, arbitrator or Governmental Authority applicable to such Subsidiary Guarantor or (iii) violate any provision of any statute or other rule or regulation of any Governmental Authority, including the USA Patriot Act, applicable to such Subsidiary Guarantor.

5.7.   Governmental Authorizations, etc.

          No consent, approval or authorization of, or registration, filing or declaration with, any Governmental Authority is required in connection with the execution, delivery or performance by the Company of this Agreement, the Intercreditor Agreement or the Notes or the execution, delivery or performance by each Subsidiary Guarantor of the Subsidiary Guaranty.

5.8.   Litigation; Observance of Statutes and Orders.

     (a) There are no actions, suits or proceedings pending or, to the knowledge of the Company, threatened against or affecting the Company or any Subsidiary or any property of the Company or any Subsidiary in any court or before any arbitrator of any kind or before or by any Governmental Authority that, individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect.

     (b) Neither the Company nor any Subsidiary is in default under any term of any agreement or instrument to which it is a party or by which it is bound, or any order, judgment, decree or ruling of any court, arbitrator or Governmental Authority or is in violation of any applicable law, ordinance, rule or regulation (including Environmental Laws or the USA Patriot Act) of any Governmental Authority, which default or violation,

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individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect.

5.9.   Taxes.

          The Company and its Subsidiaries have filed all tax returns that are required to have been filed in any jurisdiction, and have paid all taxes shown to be due and payable on such returns and all other taxes and assessments levied upon them or their properties, assets, income or franchises, to the extent such taxes and assessments have become due and payable and before they have become delinquent, except for any taxes and assessments (i) the amount of which is not individually or in the aggregate Material or (ii) the amount, applicability or validity of which is currently being contested in good faith by appropriate proceedings and with respect to which the Company or a Subsidiary, as the case may be, has established adequate reserves in accordance with GAAP. The Company knows of no basis for any other tax or assessment that could reasonably be expected to have a Material Adverse Effect. The charges, accruals and reserves on the books of the Company and its Subsidiaries in respect of Federal, state or other taxes for all fiscal periods are adequate. The Federal income tax liabilities of the Company and its Subsidiaries have been determined (whether by reason of completed audits or the statute of limitations having run) for all fiscal years up to and including the fiscal year ended June 30, 2001.

5.10.   Title to Property; Leases.

          The Company and its Subsidiaries have good and sufficient title to their respective properties that individually or in the aggregate are Material, including all such properties reflected in the most recent audited balance sheet referred to in Section 5.5 or purported to have been acquired by the Company or any Subsidiary after said date (except as sold or otherwise disposed of in the ordinary course of business), in each case free and clear of Liens prohibited by this Agreement. All leases that individually or in the aggregate are Material are valid and subsisting and are in full force and effect in all material respects.

5.11.   Licenses, Permits, etc.

     (a) The Company and its Subsidiaries own or possess all licenses, permits, franchises, authorizations, patents, copyrights, proprietary software, service marks, trademarks and trade names, or rights thereto, that individually or in the aggregate are Material, without known conflict with the rights of others;

     (b) To the best knowledge of the Company, no product of the Company or any Subsidiary infringes in any material respect any license, permit, franchise, authorization, patent, copyright, proprietary software, service mark, trademark, trade name or other right owned by any other Person; and

     (c) To the best knowledge of the Company, there is no Material violation by any Person of any right of the Company or any of its Subsidiaries with respect to any patent, copyright, proprietary software, service mark, trademark, trade name or other right owned or used by the Company or any of its Subsidiaries.

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5.12.   Compliance with ERISA.

     (a) The Company and each ERISA Affiliate have operated and administered each Plan (other than Multiemployer Plans) in compliance with all applicable laws except for such instances of noncompliance as have not resulted in and could not reasonably be expected to result in a Material Adverse Effect. Neither the Company nor any ERISA Affiliate has incurred any liability pursuant to Title I or IV of ERISA or the penalty or excise tax provisions of the Code relating to employee benefit plans (as defined in Section 3 of ERISA), and no event, transaction or condition has occurred or exists that could reasonably be expected to result in the incurrence of any such liability by the Company or any ERISA Affiliate, or in the imposition of any Lien on any of the rights, properties or assets of the Company or any ERISA Affiliate, in either case pursuant to Title I or IV of ERISA or to such penalty or excise tax provisions or to Section 401(a)(29) or 412 of the Code or section 4068 of ERISA, other than such liabilities or Liens as would not be individually or in the aggregate Material.

     (b) The present value of the aggregate benefit liabilities under each of the Plans (other than Multiemployer Plans), determined as of the end of such Plan’s most recently ended plan year on the basis of the actuarial assumptions specified for funding purposes in such Plan’s most recent actuarial valuation report, did not exceed the aggregate current value of the assets of such Plan allocable to such benefit liabilities by more than $5,000,000 in the aggregate for all Plans. The term “benefit liabilities” has the meaning specified in section 4001 of ERISA and the terms “current value” and “present value” have the meaning specified in section 3 of ERISA.

     (c) The Company and its ERISA Affiliates have not incurred withdrawal liabilities (and are not subject to contingent withdrawal liabilities) under section 4201 or 4204 of ERISA in respect of Multiemployer Plans that individually or in the aggregate are Material.

     (d) The accumulated postretirement benefit obligation (determined as of the last day of the Company’s most recently ended fiscal year in accordance with Financial Accounting Standards Board Statement No. 106, without regard to liabilities attributable to continuation coverage mandated by section 4980B of the Code) of the Company and its Subsidiaries is not Material.

     (e) The execution and delivery of this Agreement and the issuance and sale of the Series 2005-A Notes hereunder will not involve any transaction that is subject to the prohibitions of section 406 of ERISA or in connection with which a tax could be imposed pursuant to section 4975(c)(1)(A)-(D) of the Code. The representation by the Company in the first sentence of this Section 5.12(e) is made in reliance upon and subject to the accuracy of your representation in Section 6.2 as to the sources of the funds used to pay the purchase price of the Notes to be purchased by you.

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5.13.   Private Offering by the Company.

          Neither the Company nor anyone acting on its behalf has offered the Notes or any similar securities for sale to, or solicited any offer to buy any of the same from, or otherwise approached or negotiated in respect thereof with, any person other than you, the Other Purchasers and not more than 50 other Institutional Investors, each of which has been offered the Notes at a private sale for investment. Neither the Company nor anyone acting on its behalf has taken, or will take, any action that would subject the issuance or sale of the Notes to the registration requirements of Section 5 of the Securities Act or to the registration requirements of any securities or blue sky laws of any applicable jurisdiction.

5.14.   Use of Proceeds; Margin Regulations.

          The Company will apply the proceeds of the sale of the Notes for general corporate purposes and to refinance Debt as set forth in Schedule 5.14. No part of the proceeds from the sale of the Notes will be used, directly or indirectly, for the purpose of buying or carrying any margin stock within the meaning of Regulation U of the Board of Governors of the Federal Reserve System (12 CFR 221), or for the purpose of buying or carrying or trading in any securities under such circumstances as to involve the Company in a violation of Regulation X of said Board (12 CFR 224) or to involve any broker or dealer in a violation of Regulation T of said Board (12 CFR 220). Margin stock does not constitute more than 1% of the value of the consolidated assets of the Company and its Subsidiaries and the Company does not have any present intention that margin stock will constitute more than 1% of the value of such assets. As used in this Section, the terms “margin stock” and “purpose of buying or carrying” shall have the meanings assigned to them in said Regulation U.

5.15.   Existing Debt.

     (a) Except as described therein, Schedule 5.15 sets forth a complete and correct list of all outstanding Debt of the Company and its Subsidiaries as of December 31, 2004 (including a description of the obligors and obligees, principal amount outstanding and collateral therefor, if any, and Guaranty thereof, if any), since which date there has been no Material change in the amounts, interest rates, sinking funds, installment payments or maturities of the Debt of the Company or its Subsidiaries. Neither the Company nor any Subsidiary is in default and no waiver of default is currently in effect, in the payment of any principal or interest on any Debt of the Company or such Subsidiary and no event or condition exists with respect to any Debt of the Company or any Subsidiary that would permit (or that with notice or the lapse of time, or both, would permit) one or more Persons to cause such Debt to become due and payable before its stated maturity or before its regularly scheduled dates of payment.

     (b) Except as disclosed in Schedule 5.15, neither the Company nor any Subsidiary has agreed or consented to cause or permit in the future (upon the happening of a contingency or otherwise) any of its property, whether now owned or hereafter acquired, to be subject to a Lien not permitted by Section 10.5.

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5.16.   Foreign Assets Control Regulations, etc.

     (a) Neither the sale of the Notes by the Company hereunder nor its use of the proceeds thereof will violate the Trading with the Enemy Act, as amended, or any of the foreign assets control regulations of the United States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) or any enabling legislation or executive order relating thereto.

     (b) Neither the Company nor any Subsidiary (i) is a Person described or designated in the Specially Designated Nationals and Blocked Persons List of the Office of Foreign Assets Control or in Section 1 of the Anti-Terrorism Order or (ii) to the Company’s knowledge, engages in any dealings or transactions with any such Person. The Company and its Subsidiaries are in compliance, in all material respects, with the USA Patriot Act.

     (c) No part of the proceeds from the sale of the Notes hereunder will be used, directly or indirectly, in violation of the United States Foreign Corrupt Practices Act of 1977, as amended, assuming in all cases that such Act applies to the Company.

5.17.   Status under Certain Statutes.

          Neither the Company nor any Subsidiary is subject to regulation under the Investment Company Act of 1940, as amended, the Public Utility Holding Company Act of 1935, as amended, the ICC Termination Act, as amended, or the Federal Power Act, as amended.

5.18.   Environmental Matters.

     (a) Neither the Company nor any Subsidiary has knowledge of any claim or has received any notice of any claim, and no proceeding has been instituted raising any claim against the Company or any of its Subsidiaries or any of their respective real properties now or formerly owned, leased or operated by any of them or other assets, alleging any damage to the environment or violation of any Environmental Laws, except, in each case, such as could not reasonably be expected to result in a Material Adverse Effect.

     (b) Neither the Company nor any Subsidiary has knowledge of any facts which would give rise to any claim, public or private, of violation of Environmental Laws or damage to the environment emanating from, occurring on or in any way related to real properties now or formerly owned, leased or operated by any of them or to other assets or their use, except, in each case, such as could not reasonably be expected to result in a Material Adverse Effect;

     (c) Neither the Company nor any of its Subsidiaries has stored any Hazardous Materials on real properties now or formerly owned, leased or operated by any of them and has not disposed of any Hazardous Materials in a manner contrary to any Environmental Laws in each case in any manner that could reasonably be expected to result in a Material Adverse Effect; and

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     (d) All buildings on all real properties now owned, leased or operated by the Company or any of its Subsidiaries are in compliance with applicable Environmental Laws, except where failure to comply could not reasonably be expected to result in a Material Adverse Effect.

5.19.   Solvency of Subsidiary Guarantors.

          After giving effect to the transactions contemplated herein and after giving due consideration to any rights of contribution (i) each Subsidiary Guarantor has received fair consideration and reasonably equivalent value for the incurrence of its obligations under the Subsidiary Guaranty, (ii) the fair value of the assets of each Subsidiary Guarantor (both at fair valuation and at present fair saleable value) exceeds its liabilities, (iii) each Subsidiary Guarantor is able to and expects to be able to pay its debts as they mature, and (iv) each Subsidiary Guarantor has capital sufficient to carry on its business as conducted and as proposed to be conducted.

5.20.   Pari Passu Ranking.

          The obligations of the Company under the Notes rank pari passu in right of payment with all other unsecured Senior Debt (actual or contingent) of the Company, including the unsecured Senior Debt listed in Schedule 5.15.

6.   REPRESENTATIONS OF THE PURCHASERS.

6.1.   Purchase for Investment.

          You represent that you are purchasing the Notes for your own account or for one or more separate accounts maintained by you or for the account of one or more pension or trust funds and not with a view to the distribution thereof, provided that the disposition of your or their property shall at all times be within your or their control. You understand that the Notes have not been registered under the Securities Act and may be resold only if registered pursuant to the provisions of the Securities Act or if an exemption from registration is available, except under circumstances where neither such registration nor such an exemption is required by law, and that the Company is not required to register the Notes. You represent that you are a Qualified Institutional Buyer or an “accredited investor” within the meaning of subparagraph (a)(1), (2), (3) or (7) of Rule 501 of Regulation D under the Securities Act.

6.2.   Source of Funds.

          You represent that at least one of the following statements is an accurate representation as to each source of funds (a “Source”) to be used by you to pay the purchase price of the Notes to be purchased by you hereunder:

     (a) the Source is an “insurance company general account” (as the term is defined in the United States Department of Labor’s Prohibited Transaction Exemption (“PTE”) 95-60) in respect of which the reserves and liabilities (as defined by the annual statement for life insurance companies approved by the National Association of

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Insurance Commissioners (the “NAIC Annual Statement”) for the general account contract(s) held by or on behalf of any employee benefit plan together with the amount of the reserves and liabilities for the general account contract(s) held by or on behalf of any other employee benefit plans maintained by the same employer (or affiliate thereof as defined in PTE 95-60) or by the same employee organization in the general account do not exceed 10% of the total reserves and liabilities of the general account (exclusive of separate account liabilities) plus surplus as set forth in the NAIC Annual Statement filed with such Purchaser’s state of domicile and the other applicable conditions of such exemption are otherwise satisfied as of the date of acquisition of the Notes; or

     (b) the Source is a separate account that is maintained solely in connection with such Purchaser’s fixed contractual obligations under which the amounts payable, or credited, to any employee benefit plan (or its related trust) that has any interest in such separate account (or to any participant or beneficiary of such plan (including any annuitant)) are not affected in any manner by the investment performance of the separate account; or

     (c) the Source is either (i) an insurance company pooled separate account, within the meaning of PTE 90-1, or (ii) a bank collective investment fund, within the meaning of PTE 91-38 and, except as you have disclosed to the Company in writing pursuant to this paragraph (c), no employee benefit plan or group of plans maintained by the same employer or employee organization beneficially owns more than 10% of all assets allocated to such pooled separate account or collective investment fund and the other applicable conditions of such exemption are otherwise satisfied as of the date of acquisition of the Notes; or

     (d) the Source constitutes assets of an “investment fund” (within the meaning of Part V of PTE 84-14 (the “QPAM Exemption”) managed by a “qualified professional asset manager” or “QPAM” (within the meaning of Part V of the QPAM Exemption), no employee benefit plan’s assets that are included in such investment fund, when combined with the assets of all other employee benefit plans established or maintained by the same employer or by an affiliate (within the meaning of Part V(c)(1) of the QPAM Exemption) of such employer or by the same employee organization and managed by such QPAM, exceed 20% of the total client assets managed by such QPAM, the conditions of Part I(c) and (g) of the QPAM Exemption are satisfied, neither the QPAM nor a person controlling or controlled by the QPAM (applying the definition of “control” in Part V(e) of the QPAM Exemption) owns a 5% or more interest in the Company and (i) the identity of such QPAM and (ii) the names of all employee benefit plans whose assets are included in such investment fund have been disclosed to the Company in writing pursuant to this clause (d) and the other applicable conditions of such exemption are otherwise satisfied as of the date of acquisition of the Notes; or

     (e) the Source constitutes assets of a “plan(s)” (within the meaning of Part IV of PTE 96-23 (the “INHAM Exemption”) managed by an “in-house asset manager” or “INHAM” (within the meaning of Part IV of the INHAM exemption), the conditions of Part I(a), (g) and (h) of the INHAM Exemption are satisfied, neither the INHAM nor a person controlling or controlled by the INHAM (applying the definition of “control” in

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Part IV(d) of the INHAM Exemption) owns a 5% or more interest in the Company and (i) the identity of such INHAM and (ii) the name(s) of the employee benefit plan(s) whose assets constitute the Source have been disclosed to the Company in writing pursuant to this clause (e) and the other applicable conditions of such exemption are otherwise satisfied as of the date of acquisition of the Notes; or

     (f) the Source is a governmental plan; or

     (g) the Source is one or more employee benefit plans, or a separate account or trust fund comprised of one or more employee benefit plans, each of which has been identified to the Company in writing pursuant to this paragraph (g); or

     (h) the Source does not include assets of any employee benefit plan, other than a plan exempt from the coverage of ERISA and from application of Section 4975 of the Code.

As used in this Section 6.2, the terms “employee benefit plan”, “governmental plan” and “separate account” shall have the respective meanings assigned to such terms in Section 3 of ERISA.

7.   INFORMATION AS TO COMPANY.

7.1.   Financial and Business Information

          The Company will deliver to each holder of Notes that is an Institutional Investor:

     (a) Quarterly Statements — within 60 days after the end of each quarterly fiscal period in each fiscal year of the Company (other than the last quarterly fiscal period of each such fiscal year), duplicate copies of,

     (i) consolidated balance sheet of the Company and its Subsidiaries as at the end of such quarter,

     (ii) consolidated statements of income of the Company and its Subsidiaries for such quarter and (in the case of the second and third quarters) for the portion of the fiscal year ending with such quarter, and

     (iii) consolidated statements of cash flows of the Company and its Subsidiaries for such quarter or (in the case of the second and third quarters) for the portion of the fiscal year ending with such quarter,

setting forth in each case in comparative form the figures for the corresponding periods in the previous fiscal year, all in reasonable detail, prepared in accordance with GAAP applicable to quarterly financial statements generally, and certified by a Senior Financial Officer as fairly presenting, in all material respects, the financial position of the companies being reported on and their results of operations and cash flows, subject to changes resulting from year-end adjustments, provided that delivery within the time period specified above of copies of the Company’s Quarterly Report on Form 10-Q

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prepared in compliance with the requirements therefor and filed with the Securities and Exchange Commission shall be deemed to satisfy the requirements of this Section 7.1(a);

     (b) Annual Statements — within 105 days after the end of each fiscal year of the Company, duplicate copies of,

     (i) consolidated balance sheet of the Company and its Subsidiaries, as at the end of such year, and

     (ii) consolidated statements of income, changes in shareholders’ equity and cash flows of the Company and its Subsidiaries, for such year,

setting forth in each case in comparative form the figures for the previous fiscal year, all in reasonable detail, prepared in accordance with GAAP, and accompanied by an opinion of independent certified public accountants of recognized national standing, which opinion shall state that such financial statements present fairly, in all material respects, the financial position of the companies being reported upon and their results of operations and cash flows and have been prepared in conformity with GAAP, and that the examination of such accountants in connection with such financial statements has been made in accordance with generally accepted auditing standards, and that such audit provides a reasonable basis for such opinion in the circumstances, provided that the delivery within the time period specified above of the Company’s Annual Report on Form 10-K for such fiscal year (together with the Company’s annual report to shareholders, if any, prepared pursuant to Rule 14a-3 under the Exchange Act) prepared in accordance with the requirements therefor and filed with the Securities and Exchange Commission shall be deemed to satisfy the requirements of this Section 7.1(b);

     (c) Unrestricted Subsidiaries — if, at the time of delivery of any financial statements pursuant to Section 7.1(a) or (b), Unrestricted Subsidiaries account for more than 10% of (i) the consolidated total assets of the Company and its Subsidiaries reflected in the balance sheet included in such financial statements or (ii) the consolidated revenues of the Company and its Subsidiaries reflected in the consolidated statement of income included in such financial statements, an unaudited balance sheet for all Unrestricted Subsidiaries taken as whole as at the end of the fiscal period included in such financial statements and the related unaudited statements of income, stockholders’ equity and cash flows for such Unrestricted Subsidiaries for such period, together with consolidating statements reflecting all eliminations or adjustments necessary to reconcile such group financial statements to the consolidated financial statements of the Company and its Subsidiaries shall be delivered together with the financial statements required pursuant to Sections 7.1(a) and (b);

     (d) SEC and Other Reports — promptly upon their becoming available, one copy of (i) each financial statement, report, notice or proxy statement sent by the Company or any Restricted Subsidiary to public securities holders generally, and (ii) each regular or periodic report, each registration statement other than registration statements on Form S-8 (without exhibits except as expressly requested by such holder), and each prospectus and all amendments thereto filed by the Company or any Restricted

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Subsidiary with the Securities and Exchange Commission and of all press releases and other statements made available generally by the Company or any Restricted Subsidiary to the public concerning developments that are Material;

     (e) Notice of Default or Event of Default — promptly, and in any event within five Business Days after a Responsible Officer becoming aware of the existence of any Default or Event of Default or that any Person has given any notice or taken any action with respect to a claimed default hereunder or that any Person has given notice or taken any action with respect to a claimed default of the type referred to in Section 11(f), a written notice specifying the nature and period of existence thereof and what action the Company is taking or proposes to take with respect thereto;

     (f) ERISA Matters — promptly, and in any event within five Business Days after a Responsible Officer becoming aware of any of the following, a written notice setting forth the nature thereof and the action, if any, that the Company or an ERISA Affiliate proposes to take with respect thereto:

     (i) with respect to any Plan, any reportable event, as defined in section 4043(b) of ERISA and the regulations thereunder, for which notice thereof has not been waived pursuant to such regulations as in effect on the date hereof; or

     (ii) the taking by the PBGC of steps to institute, or the threatening by the PBGC of the institution of, proceedings under section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Plan, or the receipt by the Company or any ERISA Affiliate of a notice from a Multiemployer Plan that such action has been taken by the PBGC with respect to such Multiemployer Plan; or

     (iii) any event, transaction or condition that could result in the incurrence of any liability by the Company or any ERISA Affiliate pursuant to Title I or IV of ERISA or the penalty or excise tax provisions of the Code relating to employee benefit plans, or in the imposition of any Lien on any of the rights, properties or assets of the Company or any ERISA Affiliate pursuant to Title I or IV of ERISA or such penalty or excise tax provisions, if such liability or Lien, taken together with any other such liabilities or Liens then existing, could reasonably be expected to have a Material Adverse Effect;

     (g) Notices from Governmental Authority — promptly, and in any event within 30 days of receipt thereof, copies of any notice to the Company or any Subsidiary from any Federal or state Governmental Authority relating to any order, ruling, statute or other law or regulation that could reasonably be expected to have a Material Adverse Effect;

     (h) Supplements — promptly and in any event within 10 Business Days after the execution and delivery of any Supplement, a copy thereof; and

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     (i) Requested Information — with reasonable promptness, such other data and information relating to the business, operations, affairs, financial condition, assets or properties of the Company or any of its Subsidiaries or relating to the ability of the Company to perform its obligations hereunder and under the Notes as from time to time may be reasonably requested by any such holder of Notes.

7.2.   Officer’s Certificate.

          Each set of financial statements delivered to a holder of Notes pursuant to Section 7.1(a) or (b) shall be accompanied by a certificate of a Senior Financial Officer setting forth:

     (a) Covenant Compliance — the information (including detailed calculations) required in order to establish whether the Company was in compliance with the requirements of Section 10.1 through Section 10.10, inclusive, during the quarterly or annual period covered by the statements then being furnished (including with respect to each such Section, where applicable, the calculations of the maximum or minimum amount, ratio or percentage, as the case may be, permissible under the terms of such Sections, and the calculation of the amount, ratio or percentage then in existence); and

     (b) Event of Default — a statement that such officer has reviewed the relevant terms hereof and has made, or caused to be made, under his or her supervision, a review of the transactions and conditions of the Company and its Subsidiaries from the beginning of the quarterly or annual period covered by the statements then being furnished to the date of the certificate and that such review shall not have disclosed the existence during such period of any condition or event that constitutes a Default or an Event of Default or, if any such condition or event existed or exists (including any such event or condition resulting from the failure of the Company or any Subsidiary to comply with any Environmental Law), specifying the nature and period of existence thereof and what action the Company shall have taken or proposes to take with respect thereto.

7.3.   Visitation.

          The Company will permit the representatives of each holder of Notes that is an Institutional Investor:

     (a) No Default — if no Default or Event of Default then exists, at the expense of such holder and upon reasonable prior notice to the Company, to visit the principal executive office of the Company, to discuss the affairs, finances and accounts of the Company and its Subsidiaries with the Company’s officers, and (with the consent of the Company, which consent will not be unreasonably withheld) its independent public accountants, and (with the consent of the Company, which consent will not be unreasonably withheld) to visit the other offices and properties of the Company and each Subsidiary, all at such reasonable times and as often as may be reasonably requested in writing; and

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     (b) Default — if a Default or Event of Default then exists, at the expense of the Company, to visit and inspect any of the offices or properties of the Company or any Subsidiary, to examine all their respective books of account, records, reports and other papers, to make copies and extracts therefrom, and to discuss their respective affairs, finances, and accounts with their respective officers and independent public accountants (and by this provision the Company authorizes said accountants to discuss the affairs, finances and accounts of the Company and its Subsidiaries), all at such times and as often as may be requested.

8.   PREPAYMENT OF THE NOTES.

8.1.   No Scheduled Prepayments.

          No regularly scheduled prepayments are due on the Series 2005 Notes prior to their stated maturity.

     8.2. Optional Prepayments.

     (a) Fixed Rate Notes. The Company may, at its option, upon notice as provided below, prepay at any time all, or from time to time any part of, one or more series or tranches of fixed rate Notes, including the Series 2005-A Notes, in an amount not less than $2,000,000 in the aggregate in the case of a partial prepayment, at 100% of the principal amount so prepaid, plus the Make-Whole Amount determined for the prepayment date with respect to such principal amount. The Company will give each holder of each series or tranche of fixed rate Notes to be prepaid written notice of each optional prepayment under this Section 8.2(a) not less than 30 days and not more than 60 days prior to the date fixed for such prepayment. Each such notice shall specify such date, the aggregate principal amount of each series or tranche of fixed rate Notes to be prepaid on such date, the principal amount of each Note held by such holder to be prepaid (determined in accordance with Section 8.3), and the interest to be paid on the prepayment date with respect to such principal amount being prepaid, and shall be accompanied by a certificate of a Senior Financial Officer as to the estimated Make-Whole Amount due in connection with such prepayment (calculated as if the date of such notice were the date of the prepayment), setting forth the details of such computation. Two Business Days prior to such prepayment, the Company shall deliver to each holder of the series or tranche of fixed rate Notes being prepaid a certificate of a Senior Financial Officer specifying the calculation of such Make-Whole Amount as of the specified prepayment date.

     (b) Floating Rate Notes. The Company may, at its option, upon notice as provided below, prepay at any time all, or from time to time any part of, either tranche of the Series 2005-B Notes, in an amount not less than $2,000,000 in the aggregate in the case of a partial prepayment, at 100% of the principal amount so prepaid, plus the prepayment premium set forth below, and if such prepayment is to occur on any date other than an interest payment date, the LIBOR Breakage Amount, if any.

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If Prepaid During the Period	Prepayment Premium
April 7, 2005 through March 31, 2006	2.0%
April 1, 2006 through March 31, 2007	1.0%
April 1, 2007 and thereafter	0.0%

The Company will give each holder of each series or tranche of floating rate Notes to be prepaid, including the Series 2005-B Notes, written notice of each optional prepayment under this Section 8.2(b) not less than 30 days and not more than 60 days prior to the date fixed for such prepayment. Each such notice shall specify such date, the aggregate principal amount of each series or tranche of floating rate Notes to be prepaid on such date, the principal amount of each floating rate Note held by such holder to be prepaid (determined in accordance with Section 8.3), the interest to be paid on the prepayment date with respect to such principal amount being prepaid and the amount of any prepayment premium and LIBOR Breakage Amount to be paid. The terms on which floating rate Additional Notes may be prepaid at the option of the Company will be set forth in the Supplement pursuant to which such Notes are issued.

8.3.   Allocation of Partial Prepayments.

          In the case of each partial prepayment of Notes of a series or tranche pursuant to Section 8.2(a) or (b), the principal amount of the Notes of the series or tranche to be prepaid shall be allocated among all of the Notes of such series or tranche at the time outstanding in proportion, as nearly as practicable, to the respective unpaid principal amounts thereof not theretofore called for prepayment.

8.4.   Maturity; Surrender, etc.

          In the case of each prepayment of Notes pursuant to this Section 8, the principal amount of each Note to be prepaid shall mature and become due and payable on the date fixed for such prepayment, together with interest on such principal amount accrued to such date and the applicable Make-Whole Amount, if any, prepayment premium, if any, and LIBOR Breakage Amount, if any. From and after such date, unless the Company shall fail to pay such principal amount when so due and payable, together with the interest and Make-Whole Amount, if any, prepayment premium, if any, or LIBOR Breakage Amount, if any, as aforesaid, interest on such principal amount shall cease to accrue. Any Note paid or prepaid in full, after such payment and upon the written request of the Company, shall be surrendered to the Company and canceled and shall not be reissued, and no Note shall be issued in lieu of any prepaid principal amount of any Note.

8.5.   Purchase of Notes.

          The Company will not and will not permit any Affiliate to purchase, redeem, prepay or otherwise acquire, directly or indirectly, any of the outstanding Notes of any series except upon the payment or prepayment of such series of Notes in accordance with the terms of this Agreement. The Company will promptly cancel all Notes acquired by it or any Affiliate

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pursuant to any payment, prepayment or purchase of Notes pursuant to any provision of this Agreement and no Notes may be issued in substitution or exchange for any such Notes.

8.6.   Make-Whole Amount.

          The term “Make-Whole Amount” means, with respect to any fixed rate Note, an amount equal to the excess, if any, of the Discounted Value of the Remaining Scheduled Payments with respect to the Called Principal of such Note over the amount of such Called Principal, provided that the Make-Whole Amount may in no event be less than zero. For the purposes of determining the Make-Whole Amount, the following terms have the following meanings:

     “Called Principal” means, with respect to any fixed rate Note, the principal of such Note that is to be prepaid pursuant to Section 8.2 or has become or is declared to be immediately due and payable pursuant to Section 12.1, as the context requires.

     “Discounted Value” means, with respect to the Called Principal of any fixed rate Note, the amount obtained by discounting all Remaining Scheduled Payments with respect to such Called Principal from their respective scheduled due dates to the Settlement Date with respect to such Called Principal, in accordance with accepted financial practice and at a discount factor (applied on the same periodic basis as that on which interest on the Notes is payable) equal to the Reinvestment Yield with respect to such Called Principal.

     “Reinvestment Yield” means, with respect to the Called Principal of any fixed rate Note, .50% over the yield to maturity implied by (i) the yields reported, as of 10:00 A.M. (New York City time) on the second Business Day preceding the Settlement Date with respect to such Called Principal, on the display designated as the “PX Screen” on the Bloomberg Financial Market Service (or such other display as may replace the PX Screen on Bloomberg Financial Market Service) for actively traded U.S. Treasury securities having a maturity equal to the Remaining Average Life of such Called Principal as of such Settlement Date, or (ii) if such yields are not reported as of such time or the yields reported as of such time are not ascertainable, the Treasury Constant Maturity Series Yields reported, for the latest day for which such yields have been so reported as of the second Business Day preceding the Settlement Date with respect to such Called Principal, in Federal Reserve Statistical Release H.15 (519) (or any comparable successor publication) for actively traded U.S. Treasury securities having a constant maturity equal to the Remaining Average Life of such Called Principal as of such Settlement Date. Such implied yield will be determined, if necessary, by (a) converting U.S. Treasury bill quotations to bond-equivalent yields in accordance with accepted financial practice and (b) interpolating linearly between (1) the actively traded U.S. Treasury security with the maturity closest to and greater than the Remaining Average Life and (2) the actively traded U.S. Treasury security with the maturity closest to and less than the Remaining Average Life.

     “Remaining Average Life” means, with respect to any Called Principal, the number of years (calculated to the nearest one-twelfth year) obtained by dividing (i) such

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Called Principal into (ii) the sum of the products obtained by multiplying (a) the principal component of each Remaining Scheduled Payment with respect to such Called Principal by (b) the number of years (calculated to the nearest one-twelfth year) that will elapse between the Settlement Date with respect to such Called Principal and the scheduled due date of such Remaining Scheduled Payment.

     “Remaining Scheduled Payments” means, with respect to the Called Principal of any fixed rate Note, all payments of such Called Principal and interest thereon that would be due after the Settlement Date with respect to such Called Principal if no payment of such Called Principal were made prior to its scheduled due date, provided that if such Settlement Date is not a date on which interest payments are due to be made under the terms of the Notes, then the amount of the next succeeding scheduled interest payment will be reduced by the amount of interest accrued to such Settlement Date and required to be paid on such Settlement Date pursuant to Section 8.2 or 12.1.

     “Settlement Date” means, with respect to the Called Principal of any fixed rate Note, the date on which such Called Principal is to be prepaid pursuant to Section 8.2 or has become or is declared to be immediately due and payable pursuant to Section 12.1, as the context requires.

8.7.   LIBOR Breakage Amount.

          The term “LIBOR Breakage Amount” means any loss, cost or expense reasonably incurred by any holder of a floating rate Note as a result of any payment or prepayment of such Note (whether voluntary, mandatory, automatic, by reason of acceleration or otherwise) on a day other than an interest payment date or at scheduled maturity thereof, and any loss or expense arising from the liquidation or reemployment of funds obtained by such holder or from fees payable to terminate the deposits from which such funds were obtained. Any such loss, cost or expense shall be limited to the time period from the date of such prepayment through the earlier of the next interest payment date or the maturity of such floating rate Note. Each holder of a floating rate Note shall determine the LIBOR Breakage Amount with respect to the principal amount of its floating rate Notes then being paid or prepaid (or required to be paid or prepaid) by written notice to the Company setting forth such determination in reasonable detail not less than two Business Days prior to the date of prepayment. Each such determination shall be conclusive absent manifest error.

9.   AFFIRMATIVE COVENANTS.

          The Company covenants that so long as any of the Notes are outstanding:

9.1.   Compliance with Law.

          The Company will, and will cause each Subsidiary to, comply with all laws, ordinances or governmental rules or regulations to which each of them is subject, including ERISA, the USA Patriot Act and Environmental Laws, and will obtain and maintain in effect all licenses, certificates, permits, franchises and other governmental authorizations necessary to the ownership of their respective properties or to the conduct of their respective businesses, in each

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case to the extent necessary to ensure that non-compliance with such laws, ordinances or governmental rules or regulations or failures to obtain or maintain in effect such licenses, certificates, permits, franchises and other governmental authorizations could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

9.2.   Insurance.

          The Company will, and will cause each Restricted Subsidiary to, maintain, with financially sound and reputable insurers, insurance with respect to their respective properties and businesses against such casualties and contingencies, of such types, on such terms and in such amounts (including deductibles, co-insurance and self-insurance, if adequate reserves are maintained with respect thereto) as is customary in the case of entities of established reputations engaged in the same or a similar business and similarly situated, except for any non-maintenance that could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

9.3.   Maintenance of Properties.

          The Company will and will cause each Restricted Subsidiary to maintain and keep, or cause to be maintained and kept, their respective properties in good repair, working order and condition (other than ordinary wear and tear), so that the business carried on in connection therewith may be properly conducted at all times, provided that this Section shall not prevent the Company or any Restricted Subsidiary from discontinuing the operation and the maintenance of any of its properties if such discontinuance is desirable in the conduct of its business and the Company has concluded that such discontinuance could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

9.4.   Payment of Taxes and Claims.

          The Company will, and will cause each Subsidiary to, file all income tax or similar tax returns required to be filed in any jurisdiction and to pay and discharge all taxes shown to be due and payable on such returns and all other taxes, assessments, governmental charges, or levies imposed on them or any of their properties, assets, income or franchises, to the extent such taxes and assessments have become due and payable and before they have become delinquent and all claims for which sums have become due and payable that have or might become a Lien on properties or assets of the Company or any Subsidiary, provided that neither the Company nor any Subsidiary need pay any such tax or assessment or claims if (i) the amount, applicability or validity thereof is contested by the Company or such Subsidiary on a timely basis in good faith and in appropriate proceedings, and the Company or a Subsidiary has established adequate reserves therefor in accordance with GAAP on the books of the Company or such Subsidiary or (ii) the nonpayment of all such taxes and assessments in the aggregate could not reasonably be expected to have a Material Adverse Effect.

9.5.   Corporate Existence, etc.

          Subject to Section 10.7, the Company will at all times preserve and keep in full force and effect its corporate existence. Subject to Sections 10.6 and 10.7, inclusive, the

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Company will at all times preserve and keep in full force and effect the corporate existence of each of its Restricted Subsidiaries (unless merged into the Company or a Restricted Subsidiary) and all rights and franchises of the Company and its Restricted Subsidiaries unless, in the good faith judgment of the Company, the termination of or failure to preserve and keep in full force and effect such corporate existence, right or franchise could not, individually or in the aggregate, have a Material Adverse Effect.

9.6.   Additional Subsidiary Guarantors.

          The Company will cause any Subsidiary that (whether or not required by the terms of the Credit Agreement) is to become a party to, or guarantee, Debt in respect of the Credit Agreement, to enter into the Subsidiary Guaranty concurrently therewith and as a part thereof to deliver to each of the holders:

     (a) a copy of an executed joinder to the Subsidiary Guaranty;

     (b) a certificate signed by a Responsible Officer of the Company confirming the accuracy of the representations and warranties in Sections 5.2, 5.6, 5.7 and 5.19, with respect to such Subsidiary and the Subsidiary Guaranty, as applicable; and

     (c) if a comparable opinion is required by the Banks, an opinion of counsel (who may be counsel for the Company) reasonably satisfactory to the Required Holders addressed to each holder of the Notes to the effect that the Subsidiary Guaranty of such Person has been duly authorized, executed and delivered and that the Subsidiary Guaranty constitutes the legal, valid and binding contract and agreement of such Person enforceable in accordance with its terms, except as an enforcement of such terms may be limited by bankruptcy, insolvency, fraudulent conveyance and similar laws affecting the enforcement of creditors’ rights generally and by general equitable principles.

9.7.   Ranking.

          The Debt evidenced by the Notes will at all times rank at least pari passu with all of the Company’s outstanding unsecured Senior Debt.

9.8.   Books and Records.

          The Company will, and will cause each of its Subsidiaries to, maintain proper books of record and account in conformity with GAAP (or, in the case of foreign Subsidiaries, other applicable accounting principles) and all applicable requirements of any Governmental Authority having legal or regulatory jurisdiction over the Company or such Subsidiary, as the case may be.

10.   NEGATIVE COVENANTS.

          The Company covenants that so long as any of the Notes are outstanding:

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10.1.   Consolidated Net Worth.

          The Company will not permit Consolidated Net Worth to be less than $600,000,000 at any time.

10.2.   Consolidated Net Debt.

          The Company will not permit the ratio of Consolidated Net Debt (as of the last day of the most recently completed fiscal quarter) to Consolidated EBITDA (for the Company’s then most recently completed four fiscal quarters) to be greater than 3.00 to 1.00 at any time. If, during the period for which Consolidated EBITDA is being calculated, the Company or a Restricted Subsidiary has (i) acquired one or more Persons (or the assets thereof) or (ii) disposed of one or more Restricted Subsidiaries (or substantially all of the assets thereof), Consolidated EBITDA shall be calculated on a pro forma basis as if all of such acquisitions (other than acquisitions by or resulting in Unrestricted Subsidiaries) and all such dispositions had occurred on the first day of such period.

10.3.   Fixed Charge Coverage.

          The Company will not permit the ratio (calculated as of the end of each fiscal quarter) of Consolidated EBITDAR to Consolidated Fixed Charges for the period of four quarters ending as of each fiscal quarter to be less than 1.50 to 1.00.

10.4.   Priority Debt.

          The Company will not permit Priority Debt at any time to exceed 20% of Consolidated Net Worth (as of the end of the most recently completed fiscal quarter).

10.5.   Liens.

          The Company will not, and will not permit any Restricted Subsidiary to, permit to exist, create, assume or incur, directly or indirectly, any Lien on its properties or assets, whether now owned or hereafter acquired, except:

     (a) Liens for taxes, assessments or governmental charges not then due and delinquent or the nonpayment of which is permitted by Section 9.4;

     (b) Liens incidental to the conduct of business or the ownership of properties and assets (including landlords’, lessors’, carriers’, warehousemen’s, mechanics’, materialmen’s and other similar Liens) and Liens to secure the performance of bids, tenders, leases or trade contracts, or to secure statutory obligations (including obligations under workers compensation, unemployment insurance and other social security legislation), 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;

     (c) any attachment or judgment Lien, unless the judgment it secures has not, within 60 days after the entry thereof, been discharged or execution thereof stayed

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pending appeal, or has not been discharged within 60 days after the expiration of any such stay;

     (d) Liens securing Debt of a Restricted Subsidiary to the Company or to a Wholly Owned Restricted Subsidiary;

     (e) Liens securing Debt existing on property or assets of the Company or any Restricted Subsidiary as of the date of this Agreement that are described in Schedule 10.4;

     (f) encumbrances in the nature of leases, subleases, zoning restrictions, easements, rights of way, minor survey exceptions and other rights and restrictions of record on the use of real property and defects in title arising or incurred in the ordinary course of business, which, individually and in the aggregate, do not materially impair the use or value of the property or assets subject thereto or which relate only to assets that in the aggregate are not material;

     (g) Liens (i) existing on property at the time of its acquisition by the Company or a Restricted Subsidiary and not created in contemplation thereof, whether or not the Debt secured by such Lien is assumed by the Company or a Restricted Subsidiary; or (ii) on property created contemporaneously with its acquisition or within 365 days of the acquisition or completion of construction thereof to secure or provide for all or a portion of the purchase price or cost of construction of such property after the date of Closing; or (iii) existing on property of a Person at the time such Person is merged or consolidated with, or becomes a Restricted Subsidiary of, or substantially all of its assets are acquired by, the Company or a Restricted Subsidiary and not created in contemplation thereof; provided that in the case of clauses (i), (ii) and (iii) such Liens do not extend to additional property of the Company or any Restricted Subsidiary (other than property that is an improvement to or is acquired for specific use in connection with the subject property) and, in the case of clause (ii) only, that the aggregate principal amount of Debt secured by each such Lien does not exceed the lesser of cost of acquisition or construction or the fair market value (determined in good faith by one or more officers of the Company to whom authority to enter into the transaction has been delegated by the board of directors of the Company) of the property subject thereto;

     (h) Liens resulting from extensions, renewals or replacements of Liens permitted by paragraphs (e) and (g), provided that (i) there is no increase in the principal amount or decrease in maturity of the Debt secured thereby at the time of such extension, renewal or replacement, (ii) any new Lien attaches only to the same property theretofore subject to such earlier Lien and (iii) immediately after such extension, renewal or replacement no Default or Event of Default would exist; and

     (i) Liens securing Debt not otherwise permitted by paragraphs (a) through (h) above, provided that Priority Debt does not at any time exceed 20% of Consolidated Net Worth (as of the end of the most recently ended fiscal quarter).

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10.6.   Sale of Assets.

          Except as permitted by Section 10.7, the Company will not, and will not permit any Restricted Subsidiary to, sell, lease, transfer or otherwise dispose of, including by way of merger (collectively a “Disposition”), any assets, including capital stock of Restricted Subsidiaries, in one or a series of transactions, to any Person, other than:

     (a) Dispositions in the ordinary course of business;

     (b) Dispositions by the Company to a Wholly Owned Restricted Subsidiary or by a Restricted Subsidiary to the Company or a Wholly Owned Restricted Subsidiary; or

     (c) Dispositions not otherwise permitted by Section 10.6(a) or (b), provided that:

     (i) each such Disposition is made in an arm’s length transaction for a consideration at least equal to the fair market value of the property subject thereto;

     (ii) the aggregate net book value of all assets disposed of in any period of 365 consecutive days pursuant to this Section 10.6(c) does not exceed 10% of Consolidated Total Assets as of the end of the immediately preceding fiscal quarter; and

     (iii) at the time of such Disposition and after giving effect thereto no Default or Event of Default shall have occurred and be continuing.

Notwithstanding the foregoing, the Company may, or may permit any Restricted Subsidiary to, make a Disposition and the assets subject to such Disposition shall not be subject to or included in the foregoing limitation and computation contained in Section 10.6(c)(ii) of the preceding sentence to the extent that (i) each such Disposition is for a consideration at least equal to the fair market value of the property subject thereto, and (ii) the net proceeds from such Disposition are within 365 days of such Disposition (A) reinvested in productive assets used or useful in carrying on the business of the Company and its Restricted Subsidiaries or (B) applied to the payment or prepayment of any outstanding Debt of the Company or any Restricted Subsidiary that is pari passu with or senior to the Notes, including the Notes. Any prepayment of Notes pursuant to this Section 10.6 shall be in accordance with Sections 8.2 and 8.3, without regard to the minimum prepayment requirements of Section 8.2.

10.7.   Mergers, Consolidations, etc.

          The Company will not, and will not permit any Restricted Subsidiary to, consolidate with or merge with any other Person or convey, transfer, sell or lease all or substantially all of its assets in a single transaction or series of transactions to any Person except that:

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     (a) the Company may consolidate or merge with any other Person or convey, transfer, sell or lease all or substantially all of its assets in a single transaction or series of transactions to any Person, provided that:

     (i) the successor formed by such consolidation or the survivor of such merger or the Person that acquires by conveyance, transfer, sale or lease all or substantially all of the assets of the Company as an entirety, as the case may be, is a solvent corporation organized and existing under the laws of the United States or any state thereof (including the District of Columbia), and, if the Company is not such corporation, such corporation (y) shall have executed and delivered to each holder of any Notes its assumption of the due and punctual performance and observance of each covenant and condition of this Agreement and the Notes and (z) shall have caused to be delivered to each holder of any Notes an opinion of independent counsel reasonably satisfactory to the Required Holders, to the effect that all agreements or instruments effecting such assumption are enforceable in accordance with their terms and comply with the terms hereof; and

     (ii) immediately before and after giving effect to such transaction, no Default or Event of Default shall exist; and

     (b) Any Restricted Subsidiary may (x) merge into the Company (provided that the Company is the surviving corporation) or a Wholly Owned Restricted Subsidiary or (y) sell, transfer or lease all or any part of its assets to the Company or a Wholly Owned Restricted Subsidiary, or (z) merge or consolidate with, or sell, transfer or lease all or substantially all of its assets to, any Person in a transaction that is permitted by Section 10.6 or, as a result of which, such Person becomes a Restricted Subsidiary; provided in each instance set forth in clauses (x) through (z) that, immediately before and after giving effect thereto, there shall exist no Default or Event of Default;

No such conveyance, transfer, sale or lease of all or substantially all of the assets of the Company shall have the effect of releasing the Company or any successor corporation that shall theretofore have become such in the manner prescribed in this Section 10.7 from its liability under this Agreement or the Notes.

10.8.   Disposition of Stock of Restricted Subsidiaries.

     (a) The Company will not permit any Restricted Subsidiary to issue its capital stock, or any warrants, rights or options to purchase, or securities convertible into or exchangeable for, such capital stock, to any Person other than the Company or a Wholly Owned Restricted Subsidiary, except (i) for directors’ qualifying shares or (ii) to satisfy local ownership requirements.

     (b) The Company will not, and will not permit any Restricted Subsidiary to, sell, transfer or otherwise dispose of any shares of capital stock of a Restricted Subsidiary if such sale would be prohibited by Section 10.6, except (i) for directors’ qualifying shares or (ii) to satisfy local ownership requirements.

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     (c) If a Restricted Subsidiary at any time ceases to be such as a result of a sale or issuance of its capital stock, any Liens on property of the Company or any other Restricted Subsidiary securing Debt owed to such Restricted Subsidiary, which is not contemporaneously repaid, together with such Debt, shall be deemed to have been incurred by the Company or such other Restricted Subsidiary, as the case may be, at the time such Restricted Subsidiary ceases to be a Restricted Subsidiary.

10.9.   Designation of Restricted and Unrestricted Subsidiaries.

          The Company may designate any Restricted Subsidiary as an Unrestricted Subsidiary and any Unrestricted Subsidiary as a Restricted Subsidiary; provided that,

     (a) if such Subsidiary initially is designated a Restricted Subsidiary, then such Restricted Subsidiary may be subsequently designated as an Unrestricted Subsidiary and such Unrestricted Subsidiary may be subsequently designated as a Restricted Subsidiary, but no further changes in designation may be made;

     (b) if such Subsidiary initially is designated an Unrestricted Subsidiary, then such Unrestricted Subsidiary may be subsequently designated as a Restricted Subsidiary and such Restricted Subsidiary may be subsequently designated as an Unrestricted Subsidiary, but no further changes in designation may be made;

     (c) the Company may not designate a Restricted Subsidiary as an Unrestricted Subsidiary unless: (i) such Restricted Subsidiary does not own, directly or indirectly, any Debt or capital stock of the Company or any other Restricted Subsidiary, (ii) such designation, considered as a sale of assets, is permitted pursuant to Sections 10.6 and 10.7, (iii) immediately before and after such designation there exists no Default or Event of Default; and

     (d) a Subsidiary Guarantor may not be designated an Unrestricted Subsidiary.

10.10.   Transactions with Affiliates.

          The Company will not and will not permit any Restricted Subsidiary to enter into directly or indirectly any Material transaction or Material group of related transactions (including without limitation the purchase, lease, sale or exchange of properties of any kind or the rendering of any service) with any Affiliate (other than the Company or another Restricted Subsidiary), except in the ordinary course of the Company’s or such Restricted Subsidiary’s business and upon fair and reasonable terms no less favorable to the Company or such Restricted Subsidiary than would be obtainable in a comparable arm’s-length transaction with a Person not an Affiliate.

11.   EVENTS OF DEFAULT.

          An “Event of Default” shall exist if any of the following conditions or events shall occur and be continuing:

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     (a) the Company defaults in the payment of any principal, Make-Whole Amount, if any, prepayment premium, if any, or LBOR Breakage amount, if any, on any Note when the same becomes due and payable, whether at maturity or at a date fixed for prepayment or by declaration or otherwise; or

     (b) the Company defaults in the payment of any interest on any Note for more than five Business Days after the same becomes due and payable; or

     (c) the Company defaults in the performance of or compliance with any term contained in Section 7.1(e) or Sections 10.1 through 10.10; or

     (d) the Company defaults in the performance of or compliance with any term contained herein (other than those referred to in paragraphs (a), (b) and (c) of this Section 11) and such default is not remedied within 30 days after the earlier of (i) a Responsible Officer obtaining actual knowledge of such default and (ii) the Company receiving written notice of such default from any holder of a Note; or

     (e) any representation or warranty made in writing by or on behalf of the Company or any Subsidiary Guarantor or by any officer of the Company or a Subsidiary Guarantor in this Agreement, the Subsidiary Guaranty or in any writing furnished in connection with the transactions contemplated hereby or thereby proves to have been false or incorrect in any material respect on the date as of which made; or

     (f) (i) the Company or any Restricted Subsidiary is in default (as principal or as guarantor or other surety) in the payment of any principal of or premium or make-whole amount or interest (in an amount of at least $100,000) on any Debt that is outstanding in an aggregate principal amount of at least $10,000,000 beyond any period of grace provided with respect thereto, or (ii) the Company or any Restricted Subsidiary is in default in the performance of or compliance with any term of any evidence of any Debt that is outstanding in an aggregate principal amount of at least $10,000,000 or of any mortgage, indenture or other agreement relating thereto or any other condition exists, and as a consequence of such default or condition such Debt has become, or has been declared, due and payable before its stated maturity or before its regularly scheduled dates of payment, or (iii) as a consequence of the occurrence or continuation of any event or condition (other than the passage of time or the right of the holder of Debt to convert such Debt into equity interests), the Company or any Restricted Subsidiary has become obligated to purchase or repay Debt before its regular maturity or before its regularly scheduled dates of payment in an aggregate outstanding principal amount of at least $10,000,000; or

     (g) the Company or any Material Subsidiary (i) is generally not paying, or admits in writing its inability to pay, its debts as they become due, (ii) files, or consents by answer or otherwise to the filing against it of, a petition for relief or reorganization or arrangement or any other petition in bankruptcy, for liquidation or to take advantage of any bankruptcy, insolvency, reorganization, moratorium or other similar law of any jurisdiction, (iii) makes an assignment for the benefit of its creditors, (iv) consents to the appointment of a custodian, receiver, trustee or other officer with similar powers with

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respect to it or with respect to any substantial part of its property, (v) is adjudicated as insolvent or to be liquidated, or (vi) takes corporate action for the purpose of any of the foregoing; or

     (h) a court or governmental authority of competent jurisdiction enters an order appointing, without consent by the Company or any Material Subsidiary, a custodian, receiver, trustee or other officer with similar powers with respect to it or with respect to any substantial part of its property, or constituting an order for relief or approving a petition for relief or reorganization or any other petition in bankruptcy or for liquidation or to take advantage of any bankruptcy or insolvency law of any jurisdiction, or ordering the dissolution, winding-up or liquidation of the Company or any Material Subsidiary, or any such petition shall be filed against the Company or any Material Subsidiary and such petition shall not be dismissed within 60 days; or

     (i) a final judgment or judgments for the payment of money aggregating at least $10,000,000 are rendered against one or more of the Company and its Restricted Subsidiaries, which judgments are not, within 60 days after entry thereof, bonded, discharged, dismissed or stayed pending appeal, or are not discharged within 60 days after the expiration of such stay; or

     (j) if (i) any Plan shall fail to satisfy the minimum funding standards of ERISA or the Code for any plan year or part thereof or a waiver of such standards or extension of any amortization period is sought or granted under section 412 of the Code, (ii) a notice of intent to terminate any Plan shall have been or is reasonably expected to be filed with the PBGC or the PBGC shall have instituted proceedings under ERISA section 4042 to terminate or appoint a trustee to administer any Plan or the PBGC shall have notified the Company or any ERISA Affiliate that a Plan may become a subject of any such proceedings, (iii) the aggregate “amount of unfunded benefit liabilities” (within the meaning of section 4001(a)(18) of ERISA) under all Plans determined in accordance with Title IV of ERISA, shall be at least $5,000,000, (iv) the Company or any ERISA Affiliate shall have incurred or is reasonably expected to incur any liability pursuant to Title I or IV of ERISA or the penalty or excise tax provisions of the Code relating to employee benefit plans, (v) the Company or any ERISA Affiliate withdraws from any Multiemployer Plan, or (vi) the Company or any Subsidiary establishes or amends any employee welfare benefit plan that provides post-employment welfare benefits in a manner that would increase the liability of the Company or any Subsidiary thereunder; and any such event or events described in clauses (i) through (vi) above, either individually or together with any other such event or events, could reasonably be expected to have a Material Adverse Effect; or

     (k) the Subsidiary Guaranty ceases to be in full force and effect as a result of acts taken by the Company or any Subsidiary Guarantor (except as provided in Section 1.3(b)) or is declared to be null and void in whole or in material part by a court or other governmental or regulatory authority having jurisdiction or the validity or enforceability thereof shall be contested by any of the Company or any Subsidiary Guarantor or any of them renounces any of the same or denies that it has any or further liability thereunder.

33

As used in Section 11(j), the terms “employee benefit plan” and “employee welfare benefit plan” shall have the respective meanings assigned to such terms in Section 3 of ERISA.

12.   REMEDIES ON DEFAULT, ETC.

12.1.   Acceleration.

     (a) If an Event of Default with respect to the Company described in paragraph (g) or (h) of Section 11 (other than an Event of Default described in clause (i) of paragraph (g) or described in clause (vi) of paragraph (g) by virtue of the fact that such clause encompasses clause (i) of paragraph (g)) has occurred, all the Notes then outstanding shall automatically become immediately due and payable.

     (b) If any other Event of Default has occurred and is continuing, holders of a majority or more in principal amount of the Notes at the time outstanding may at any time at its or their option, by notice or notices to the Company, declare all the Notes then outstanding to be immediately due and payable.

     (c) If any Event of Default described in paragraph (a) or (b) of Section 11 has occurred and is continuing, any holder or holders of Notes at the time outstanding affected by such Event of Default may at any time, at its or their option, by notice or notices to the Company, declare all the Notes held by it or them to be immediately due and payable.

          Upon any Notes becoming due and payable under this Section 12.1, whether automatically or by declaration, such Notes will forthwith mature and the entire unpaid principal amount of such Notes, plus (w) all accrued and unpaid interest thereon, (x) any applicable Make-Whole Amount determined in respect of such principal amount (to the full extent permitted by applicable law), (y) any applicable prepayment premium (to the full extent permitted by applicable law), and (z) any LIBOR Breakage Amount determined in respect of such principal amount, shall all be immediately due and payable, in each and every case without presentment, demand, protest or further notice, all of which are hereby waived. The Company acknowledges, and the parties hereto agree, that each holder of a Note has the right to maintain its investment in the Notes free from repayment by the Company (except as herein specifically provided for) and that the provision for payment of a Make-Whole Amount, prepayment premium or LIBOR Breakage Amount by the Company, if any, in the event that the Notes are prepaid or are accelerated as a result of an Event of Default, is intended to provide compensation for the deprivation of such right under such circumstances.

12.2.   Other Remedies.

          If any Default or Event of Default has occurred and is continuing, and irrespective of whether any Notes have become or have been declared immediately due and payable under Section 12.1, the holder of any Note at the time outstanding may proceed to protect and enforce the rights of such holder by an action at law, suit in equity or other appropriate proceeding, whether for the specific performance of any agreement contained herein or in any Note, or for an

34

injunction against a violation of any of the terms hereof or thereof, or in aid of the exercise of any power granted hereby or thereby or by law or otherwise.

12.3. Rescission.

          At any time after any Notes have been declared due and payable pursuant to clause (b) or (c) of Section 12.1, the holders of more than 50% in principal amount of the Notes then outstanding, by written notice to the Company, may rescind and annul any such declaration and its consequences if (a) the Company has paid all overdue interest on the Notes, all principal of and any applicable Make-Whole Amount, prepayment premium and LIBOR Breakage Amount on any Notes that are due and payable and are unpaid other than by reason of such declaration, and all interest on such overdue principal and any Make-Whole Amount, prepayment premium and LIBOR Breakage Amount and (to the extent permitted by applicable law) any overdue interest in respect of the Notes, at the Default Rate, (b) all Events of Default and Defaults, other than non-payment of amounts that have become due solely by reason of such declaration, have been cured or have been waived pursuant to Section 17, and (c) no judgment or decree has been entered for the payment of any monies due pursuant hereto or to the Notes. No rescission and annulment under this Section 12.3 will extend to or affect any subsequent Event of Default or Default or impair any right consequent thereon.

12.4. No Waivers or Election of Remedies, Expenses, etc.

          No course of dealing and no delay on the part of any holder of any Note in exercising any right, power or remedy shall operate as a waiver thereof or otherwise prejudice such holder’s rights, powers or remedies. No right, power or remedy conferred by this Agreement or by any Note upon any holder thereof shall be exclusive of any other right, power or remedy referred to herein or therein or now or hereafter available at law, in equity, by statute or otherwise. Without limiting the obligations of the Company under Section 15, the Company will pay to the holder of each Note on demand such further amount as shall be sufficient to cover all costs and expenses of such holder incurred in any enforcement or collection under this Section 12, including reasonable attorneys’ fees, expenses and disbursements.

13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES.

13.1. Registration of Notes.

          The Company shall keep at its principal executive office a register for the registration and registration of transfers of Notes. The name and address of each holder of one or more Notes, each transfer thereof and the name and address of each transferee of one or more Notes shall be registered in such register. Prior to due presentment for registration of transfer, the Person in whose name any Note shall be registered shall be deemed and treated as the owner and holder thereof for all purposes hereof, and the Company shall not be affected by any notice or knowledge to the contrary. The Company shall give to any holder of a Note that is an Institutional Investor, promptly upon request therefor, a complete and correct copy of the names and addresses of all registered holders of Notes.

35

13.2. Transfer and Exchange of Notes.

          Upon surrender of any Note at the principal executive office of the Company for registration of transfer or exchange (and in the case of a surrender for registration of transfer, duly endorsed or accompanied by a written instrument of transfer duly executed by the registered holder of such Note or his attorney duly authorized in writing and accompanied by the address for notices of each transferee of such Note or part thereof), the Company shall execute and deliver, at the Company’s expense (except as provided below), one or more new Notes (as requested by the holder thereof) of the same series and tranche in exchange therefor, in an aggregate principal amount equal to the unpaid principal amount of the surrendered Note. Each such new Note shall be payable to such Person as such holder may request and shall be substantially in the form of Exhibit 1.1(a) or 1(b), as appropriate. Each such new Note shall be dated and bear interest from the date to which interest shall have been paid on the surrendered Note or dated the date of the surrendered Note if no interest shall have been paid thereon. The Company may require payment of a sum sufficient to cover any stamp tax or governmental charge imposed in respect of any such transfer of Notes. Notes shall not be transferred in denominations of less than $500,000, provided that if necessary to enable the registration of transfer by a holder of its entire holding of Notes, one Note may be in a denomination of less than $500,000. Any transferee, by its acceptance of a Note registered in its name (or the name of its nominee), shall be deemed to have made the representation set forth in Section 6.2.

13.3. Replacement of Notes.

          Upon receipt by the Company of evidence reasonably satisfactory to it of the ownership of and the loss, theft, destruction or mutilation of any Note (which evidence shall be, in the case of an Institutional Investor, notice from such Institutional Investor of such ownership and such loss, theft, destruction or mutilation), and

     (a) in the case of loss, theft or destruction, of indemnity reasonably satisfactory to it (provided that if the holder of such Note is, or is a nominee for, an original Purchaser or another Institutional Investor holder of a Note with a minimum net worth of at least $50,000,000 or a Qualified Institutional Buyer, such Person’s own unsecured agreement of indemnity shall be deemed to be satisfactory), or

     (b) in the case of mutilation, upon surrender and cancellation thereof,

the Company at its own expense shall execute and deliver, in lieu thereof, a new Note of the same series and tranche, dated and bearing interest from the date to which interest shall have been paid on such lost, stolen, destroyed or mutilated Note or dated the date of such lost, stolen, destroyed or mutilated Note if no interest shall have been paid thereon.

14. PAYMENTS ON NOTES.

14.1. Place of Payment.

          Subject to Section 14.2, payments of principal, Make-Whole Amount, if any, prepayment premium, if any, LIBOR Breakage Amount, if any, and interest becoming due and

36

payable on the Notes shall be made in Chicago, Illinois at the principal office of Bank of America in such jurisdiction. The Company may at any time, by notice to each holder of a Note, change the place of payment of the Notes so long as such place of payment shall be either the principal office of the Company in such jurisdiction or the principal office of a bank or trust company in such jurisdiction.

14.2. Home Office Payment.

          So long as you or your nominee shall be the holder of any Note, and notwithstanding anything contained in Section 14.1 or in such Note to the contrary, the Company will pay all sums becoming due on such Note for principal, Make-Whole Amount, if any, prepayment premium, if any, LIBOR Breakage Amount, if any, and interest by the method and at the address specified for such purpose below your name in Schedule A, or by such other method or at such other address as you shall have from time to time specified to the Company in writing for such purpose, without the presentation or surrender of such Note or the making of any notation thereon, except that upon written request of the Company made concurrently with or reasonably promptly after payment or prepayment in full of any Note, you shall surrender such Note for cancellation, reasonably promptly after any such request, to the Company at its principal executive office or at the place of payment most recently designated by the Company pursuant to Section 14.1. Prior to any sale or other disposition of any Note held by you or your nominee you will, at your election, either endorse thereon the amount of principal paid thereon and the last date to which interest has been paid thereon or surrender such Note to the Company in exchange for a new Note or Notes pursuant to Section 13.2. The Company will afford the benefits of this Section 14.2 to any Institutional Investor that is the direct or indirect transferee of any Note purchased by you under this Agreement and that has made the same agreement relating to such Note as you have made in this Section 14.2.

15. EXPENSES, ETC.

15.1. Transaction Expenses.

          Whether or not the transactions contemplated hereby are consummated, the Company will pay all reasonable costs and expenses (including reasonable attorneys’ fees of a single special counsel and, if reasonably required, local or other counsel) incurred by you and each Other Purchaser or holder of a Note in connection with such transactions and in connection with any amendments, waivers or consents under or in respect of this Agreement, the Notes, the Intercreditor Agreement or the Subsidiary Guaranty (whether or not such amendment, waiver or consent becomes effective), including: (a) the costs and expenses incurred in enforcing or defending (or determining whether or how to enforce or defend) any rights under this Agreement, the Notes, the Intercreditor Agreement or the Subsidiary Guaranty or in responding to any subpoena or other legal process or informal investigative demand issued in connection with this Agreement, the Notes, the Intercreditor Agreement or the Subsidiary Guaranty, or by reason of being a holder of any Note, and (b) the costs and expenses, including financial advisors’ fees, incurred in connection with the insolvency or bankruptcy of the Company or any Subsidiary or in connection with any work-out or restructuring of the transactions contemplated hereby and by the Notes. The Company’s obligation to pay any costs and expenses pursuant to this Section 15.1 shall be conditioned upon its receipt of an invoice therefor (such invoice to

37

include reasonable detail as to the basis for such costs and expenses). The Company will pay, and will save you and each other holder of a Note harmless from, all claims in respect of any fees, costs or expenses if any, of brokers and finders (other than those retained by you).

15.2. Survival.

          The obligations of the Company under this Section 15 will survive the payment or transfer of any Note, the enforcement, amendment or waiver of any provision of this Agreement or the Notes, and the termination of this Agreement.

16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT.

          All representations and warranties contained herein shall survive the execution and delivery of this Agreement and the Notes, the purchase or transfer by you of any Note or portion thereof or interest therein and the payment of any Note, and may be relied upon by any subsequent holder of a Note, regardless of any investigation made at any time by or on behalf of you or any other holder of a Note. All statements contained in any certificate or other instrument delivered by or on behalf of the Company pursuant to this Agreement shall be deemed representations and warranties of the Company under this Agreement. Subject to the preceding sentence, this Agreement and the Notes embody the entire agreement and understanding between you and the Company and supersede all prior agreements and understandings relating to the subject matter hereof.

17. AMENDMENT AND WAIVER.

17.1. Requirements.

          This Agreement, the Notes and the Subsidiary Guaranty may be amended, and the observance of any term hereof or of the Notes may be waived (either retroactively or prospectively), with (and only with) the written consent of the Company (and the Subsidiary Guarantors, in the case of the Subsidiary Guaranty) and the Required Holders, except that (a) no amendment or waiver of any of the provisions of Section 1, 2, 3, 4, 5, 6 or 21 hereof, or any defined term (as it is used therein), will be effective as to you unless consented to by you in writing, and (b) no such amendment or waiver may, without the written consent of the holder of each Note at the time outstanding affected thereby, (i) subject to the provisions of Section 12 relating to acceleration or rescission, change the amount or time of any prepayment or payment of principal of, or reduce the rate or change the time of payment or method of computation of interest or of the Make-Whole Amount or any prepayment premium or LIBOR Breakage Amount on, the Notes, (ii) change the percentage of the principal amount of the Notes the holders of which are required to consent to any such amendment or waiver, or (iii) amend any of Sections 8, 11(a), 11(b), 12, 17 or 20.

17.2. Solicitation of Holders of Notes.

     (a) Solicitation. The Company will provide each holder of the Notes (irrespective of the amount of Notes then owned by it) with sufficient information,

38

sufficiently far in advance of the date a decision is required, to enable such holder to make an informed and considered decision with respect to any proposed amendment, waiver or consent in respect of any of the provisions hereof or of the Notes. The Company will deliver executed or true and correct copies of each amendment, waiver or consent effected pursuant to the provisions of this Section 17 to each holder of outstanding Notes promptly following the date on which it is executed and delivered by, or receives the consent or approval of, the requisite holders of Notes.

     (b) Payment. The Company will not directly or indirectly pay or cause to be paid any remuneration, whether by way of supplemental or additional interest, fee or otherwise, or grant any security, to any holder of Notes as consideration for or as an inducement to the entering into by any holder of Notes or any waiver or amendment of any of the terms and provisions hereof unless such remuneration is concurrently paid, or security is concurrently granted, on the same terms, ratably to each holder of Notes then outstanding even if such holder did not consent to such waiver or amendment.

17.3. Binding Effect, etc.

          Any amendment or waiver consented to as provided in this Section 17 applies equally to all holders of Notes and is binding upon them and upon each future holder of any Note and upon the Company without regard to whether such Note has been marked to indicate such amendment or waiver. No such amendment or waiver will extend to or affect any obligation, covenant, agreement, Default or Event of Default not expressly amended or waived or impair any right consequent thereon. No course of dealing between the Company and the holder of any Note nor any delay in exercising any rights hereunder or under any Note shall operate as a waiver of any rights of any holder of such Note. As used herein, the term “this Agreement” or “the Agreement” and references thereto shall mean this Agreement as it may from time to time be amended or supplemented.

17.4. Notes held by Company, etc.

          Solely for the purpose of determining whether the holders of the requisite percentage of the aggregate principal amount of Notes then outstanding approved or consented to any amendment, waiver or consent to be given under this Agreement or the Notes, or have directed the taking of any action provided herein or in the Notes to be taken upon the direction of the holders of a specified percentage of the aggregate principal amount of Notes then outstanding, Notes directly or indirectly owned by the Company or any of its Affiliates shall be deemed not to be outstanding.

18. NOTICES.

          All notices and communications provided for hereunder shall be in writing and sent (a) by telecopy if the sender on the same day sends a confirming copy of such notice by a recognized overnight delivery service (charges prepaid), or (b) by registered or certified mail with return receipt requested (postage prepaid), or (c) by a recognized overnight delivery service (with charges prepaid). Any such notice must be sent:

39

     (i) if to you or your nominee, to you or it at the address specified for such communications in Schedule A, or at such other address as you or it shall have specified to the Company in writing,

     (ii) if to any other holder of any Note, to such holder at such address as such other holder shall have specified to the Company in writing, or

     (iii) if to the Company, to the Company at its address set forth at the beginning hereof to the attention of the Chief Financial Officer, or at such other address as the Company shall have specified to the holder of each Note in writing.

Notices under this Section 18 will be deemed given only when actually received.

19. REPRODUCTION OF DOCUMENTS.

          This Agreement and all documents relating thereto, including, without limitation, (a) consents, waivers and modifications that may hereafter be executed, (b) documents received by you at the Closing (except the Notes themselves), and (c) financial statements, certificates and other information previously or hereafter furnished to you, may be reproduced by you by any photographic, photostatic, microfilm, microcard, miniature photographic or other similar process and you may destroy any original document so reproduced. The Company agrees and stipulates that, to the extent permitted by applicable law, any such reproduction shall be admissible in evidence as the original itself in any judicial or administrative proceeding (whether or not the original is in existence and whether or not such reproduction was made by you in the regular course of business) and any enlargement, facsimile or further reproduction of such reproduction shall likewise be admissible in evidence. This Section 19 shall not prohibit the Company or any other holder of Notes from contesting any such reproduction to the same extent that it could contest the original, or from introducing evidence to demonstrate the inaccuracy of any such reproduction.

20. CONFIDENTIAL INFORMATION.

          For the purposes of this Section 20, “Confidential Information” means information delivered to you by or on behalf of the Company or any Subsidiary in connection with the transactions contemplated by or otherwise pursuant to this Agreement that is proprietary in nature and that was clearly marked or labeled or otherwise adequately identified in writing when received by you as being confidential information of the Company or such Subsidiary, provided that such term does not include information that (a) was publicly known or otherwise known to you prior to the time of such disclosure, (b) subsequently becomes publicly known through no act or omission by you or any person acting on your behalf, (c) otherwise becomes known to you other than through disclosure by the Company or any Subsidiary or (d) constitutes financial statements delivered to you under Section 7.1 that are otherwise publicly available. You will maintain the confidentiality of such Confidential Information in accordance with procedures adopted by you in good faith to protect confidential information of third parties delivered to you, provided that you may deliver or disclose Confidential Information to (i) your directors, trustees, officers, employees, agents, attorneys and affiliates (to the extent such disclosure reasonably relates to the administration of the investment represented by your Notes),

40

(ii) your financial advisors and other professional advisors who agree to hold confidential the Confidential Information substantially in accordance with the terms of this Section 20, (iii) any other holder of any Note, (iv) any Institutional Investor to which you sell or offer to sell such Note or any part thereof or any participation therein (if such Person has agreed in writing prior to its receipt of such Confidential Information to be bound by the provisions of this Section 20), (v) any Person from which you offer to purchase any security of the Company (if such Person has agreed in writing prior to its receipt of such Confidential Information to be bound by the provisions of this Section 20), (vi) any federal or state regulatory authority having jurisdiction over you, (vii) the National Association of Insurance Commissioners or any similar organization, or any nationally recognized rating agency that requires access to information about your investment portfolio or (viii) any other Person to which such delivery or disclosure may be necessary or appropriate (w) to effect compliance with any law, rule, regulation or order applicable to you, (x) in response to any subpoena or other legal process, (y) in connection with any litigation to which you are a party or (z) if an Event of Default has occurred and is continuing, to the extent you may reasonably determine such delivery and disclosure to be necessary or appropriate in the enforcement or for the protection of the rights and remedies under your Notes and this Agreement. Each holder of a Note, by its acceptance of a Note, will be deemed to have agreed to be bound by and to be entitled to the benefits of this Section 20 as though it were a party to this Agreement. On reasonable request by the Company in connection with the delivery to any holder of a Note of information required to be delivered to such holder under this Agreement or requested by such holder (other than a holder that is a party to this Agreement or its nominee), such holder will enter into an agreement with the Company embodying the provisions of this Section 20.

21. SUBSTITUTION OF PURCHASER.

          You shall have the right to substitute any one of your Affiliates as the purchaser of the Notes that you have agreed to purchase hereunder, by written notice to the Company, which notice shall be signed by both you and such Affiliate, shall contain such Affiliate’s agreement to be bound by this Agreement and shall contain a confirmation by such Affiliate of the accuracy with respect to it of the representations set forth in Section 6. Upon receipt of such notice, wherever the word “you” is used in this Agreement (other than in this Section 21), such word shall be deemed to refer to such Affiliate in lieu of you. In the event that such Affiliate is so substituted as a purchaser hereunder and such Affiliate thereafter transfers to you all of the Notes then held by such Affiliate, upon receipt by the Company of notice of such transfer, wherever the word “you” is used in this Agreement (other than in this Section 21), such word shall no longer be deemed to refer to such Affiliate, but shall refer to you, and you shall have all the rights of an original holder of the Notes under this Agreement. Notwithstanding anything to the contrary in this Section 21, if you substitute an Affiliate as the purchaser of the Notes that you have agreed to purchase hereunder, and such Affiliates breaches its obligation to purchase such Notes, you shall remain liable to purchase such Notes to the same extent as if such substitution had not occurred

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22. MISCELLANEOUS.

22.1. Successors and Assigns.

          All covenants and other agreements contained in this Agreement by or on behalf of any of the parties hereto bind and inure to the benefit of their respective successors and assigns (including, without limitation, any subsequent holder of a Note) whether so expressed or not.

22.2. Payments Due on Non-Business Days.

          Anything in this Agreement or the Notes to the contrary notwithstanding, any payment of principal of or Make-Whole Amount, prepayment premium or LIBOR Breakage Amount or interest on any Note that is due on a date other than a Business Day shall be made on the next succeeding Business Day without including the additional days elapsed in the computation of the interest payable on such next succeeding Business Day, provided that if the maturity date of any Note is a date other than a Business Day, the payment otherwise due on such maturity date shall be made on the next succeeding Business Day and shall include the additional days elapsed in the computation of interest payable on such next succeeding Business Day.

22.3. Accounting Terms.

          All accounting terms used herein which are not expressly defined in this Agreement have the meanings respectively given to them in accordance with GAAP. Except as otherwise specifically provided herein, (i) all computations made pursuant to this Agreement shall be made in accordance with GAAP, and (ii) all financial statements shall be prepared in accordance with GAAP.

22.4. Severability.

          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, and any such prohibition or unenforceability in any jurisdiction shall (to the full extent permitted by law) not invalidate or render unenforceable such provision in any other jurisdiction.

22.5. Construction.

          Each covenant contained herein shall be construed (absent express provision to the contrary) as being independent of each other covenant contained herein, so that compliance with any one covenant shall not (absent such an express contrary provision) be deemed to excuse compliance with any other covenant. Where any provision herein refers to action to be taken by any Person, or which such Person is prohibited from taking, such provision shall be applicable whether such action is taken directly or indirectly by such Person.

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          For the avoidance of doubt, all Schedules and Exhibits attached to this Agreement shall be deemed to be a part hereof.

22.6. Counterparts.

          This Agreement may be executed in any number of counterparts, each of which shall be an original but all of which together shall constitute one instrument. Each counterpart may consist of a number of copies hereof, each signed by less than all, but together signed by all, of the parties hereto.

22.7. Governing Law.

          This Agreement shall be construed and enforced in accordance with, and the rights of the parties shall be governed by, the law of the State of Illinois excluding choice-of-law principles of the law of such State that would require the application of the laws of a jurisdiction other than such State.

22.8. Jurisdiction and Process; Waiver of Jury Trial.

     (a) The Company irrevocably submits to the non-exclusive jurisdiction of any Illinois State or federal court sitting in Illinois over any suit, action or proceeding arising out of or relating to this Agreement or the Notes. To the fullest extent permitted by applicable law, the Company irrevocably waives and agrees not to assert, by way of motion, as a defense or otherwise, any claim that it is not subject to the jurisdiction of any such court, any objection that it may now or hereafter have to the laying of the venue of any such suit, action or proceeding brought in any such court and any claim that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum.

     (b) The Company consents to process being served by or on behalf of any holder of Notes in any suit, action or proceeding of the nature referred to in Section 22.8(a) by mailing a copy thereof by registered or certified mail (or any substantially similar form of mail), postage prepaid, return receipt requested, to it at its address specified in Section 18 or at such other address of which such holder shall then have been notified pursuant to said Section. The Company agrees that such service upon receipt (i) shall be deemed in every respect effective service of process upon it in any such suit, action or proceeding and (ii) shall, to the fullest extent permitted by applicable law, be taken and held to be valid personal service upon and personal delivery to it. Notices hereunder shall be conclusively presumed received as evidenced by a delivery receipt furnished by the United States Postal Service or any reputable commercial delivery service.

     (c) Nothing in this Section 22.8 shall affect the right of any holder of a Note to serve process in any manner permitted by law, or limit any right that the holders of any of the Notes may have to bring proceedings against the Company in the courts of any appropriate jurisdiction or to enforce in any lawful manner a judgment obtained in one jurisdiction in any other jurisdiction.

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     (d) THE PARTIES HERETO WAIVE TRIAL BY JURY IN ANY ACTION BROUGHT ON OR WITH RESPECT TO THIS AGREEMENT, THE NOTES OR ANY OTHER DOCUMENT EXECUTED IN CONNECTION HEREWITH OR THEREWITH.

44

          If you are in agreement with the foregoing, please sign the form of agreement on the accompanying counterpart of this Agreement and return it to the Company, whereupon the foregoing shall become a binding agreement between you and the Company.

Very truly yours,

REGIS CORPORATION

By:

Name:

Title:

S-1

The foregoing is agreed
to as of the date thereof.
ALLSTATE INSURANCE COMPANY
By:
Name:
By:
Name:
	Authorized Signatories
ALLSTATE LIFE INSURANCE COMPANY
By:
Name:
By:
Name:
	Authorized Signatories

S-2

TRANSAMERICA LIFE INSURANCE

AND ANNUITY COMPANY

By:

Name:

Title:

MONUMENTAL LIFE INSURANCE COMPANY

By:

Name:

Title:

S-3

ING USA ANNUITY AND LIFE INSURANCE COMPANY

By: ING Investment Management LLC, as Agent

By:

Name:

Title:

RELIASTAR LIFE INSURANCE COMPANY

By: ING Investment Management LLC, as Agent

By:

Name:

Title:

ING LIFE INSURANCE AND ANNUITY COMPANY

By: ING Investment Management LLC, as Agent

By:

Name:

Title:

S-4

CONNECTICUT GENERAL LIFE
INSURANCE COMPANY

By: CIGNA Investments, Inc. as Authorized Agent

By:

Name:

Title:

CIGNA LIFE INSURANCE COMPANY
OF NEW YORK

By: CIGNA Investments, Inc. as Authorized Agent

By:

Name:

Title:

LIFE INSURANCE COMPANY OF NORTH AMERICA

By: CIGNA Investments, Inc. as Authorized Agent

By:

Name:

Title:

S-5

TEACHERS INSURANCE AND ANNUITY ASSOCIATION OF AMERICA

By:

Name:

Title:

S-6

PPM AMERICA, INC., as attorney in fact,

on behalf of JACKSON NATIONAL LIFE

INSURANCE COMPANY

By:

Name:

Title:

S-7

SUN LIFE INSURANCE AND ANNUITY

COMPANY OF NEW YORK

By:

Name:

Title:

By:

Name:

Title:

SUN LIFE ASSURANCE COMPANY OF CANADA (U.S.)

By:

Name:

Title:

By:

Name:

Title:

S-8

THE GUARDIAN LIFE INSURANCE COMPANY
OF AMERICA

By:

Name:

Title:

S-9

AMERICAN FAMILY LIFE INSURANCE COMPANY

By:

Name: Phillip Hannifan

Title: Investment Director

S-10

AMERITAS LIFE INSURANCE CORP.

By: Ameritas Investment Advisors Inc., as Agent

By:

Name: Andrew S. White

Title: Vice President – Fixed Income Securities

AMERITAS VARIABLE LIFE INSURANCE COMPANY

By: Ameritas Investment Advisors Inc., as Agent

By:

Name: Andrew S. White

Title: Vice President – Fixed Income Securities

ACACIA LIFE INSURANCE COMPANY

By: Ameritas Investment Advisors Inc., as Agent

By:

Name: Andrew S. White

Title: Vice President – Fixed Income Securities

S-11

COUNTRY LIFE INSURANCE COMPANY

By:

Name:

Title:

S-12

SECURITY FINANCIAL LIFE INSURANCE CO.

By:

Name:

Title:

S-13

SCHEDULE A

INFORMATION RELATING TO PURCHASERS

	Principal Amount of Notes to be Purchased
Name of Purchaser	Series 2005-A, Tranche 1, Notes	Series 2005-A, Tranche 2, Notes
ALLSTATE INSURANCE COMPANY

Series 2005-B, Tranche 1, Notes	Series 2005-B, Tranche 2, Notes
$10,000,000

Register Notes in name of: ALLSTATE INSURANCE COMPANY

(1)	All payments by Fedwire transfer of immediately available funds or ACH payments, identifying the name of the Issuer, the Private Placement Number and the payment as principal, interest or premium, in the format as follows:
	Bank: Citibank ABA #: 021000089 Account Name: Allstate Insurance Company Bond Collection Account Account #: 30546979 Reference: OBI [Insert 9-digit Private Placement No., Credit Name, Coupon, Maturity here], Payment Due Date (MM/DD/YY) and the type and amount of payment being made.           For example:           P___ (Enter “P” and amount of principal being remitted,           for example, P5000000.00) -           I___ (Enter “I” and amount of interest being remitted,           for example, I225000.00)
(2)	All notices of scheduled payments and written confirmations of such wire transfers:
	Allstate Investments LLC Investment Operations - Private Placements 3075 Sanders Road, STE G4A Northbrook, IL 60062-7127 Telephone: (847) 402-6672 Private Placements Telecopy: (847) 326-7032 E-Mail: PrivateIOD@allstate.com

Schedule A

(3)	All financial reports, compliance certificates and all other written communications, including notice of prepayments, to be sent by email (PrivateCompliance@allstate.com) or hard copy to:
	Allstate Investments LLC Private Placements Department 3075 Sanders Road, STE G5D Northbrook, Illinois 60062-7127 Telephone: (847) 402-7117 Telecopy: (847) 402-3092
(4)	Securities to be delivered to:
	Citibank N.A. 333 West 34th Street 3rd Floor Securities Vault New York, NY 10001 Attn: Danny Reyes For Allstate Insurance Company/Safekeeping Account No. 846626
(5)	One set of closing documents and two conformed copies of each of the principal documents to be delivered to:
	Peter McElvain Counsel Allstate Investments, LLC 3075 Sanders Road, Suite G5A Northbrook, IL 60062-7127 Fax: 847/402-6639 Email: pmcelvai@allstate.com
(6)	Tax ID No. 36-0719665

Schedule A

INFORMATION RELATING TO PURCHASERS

	Principal Amount of Notes to be Purchased
Name of Purchaser	Series 2005-A, Tranche 1, Notes	Series 2005-A, Tranche 2, Notes
ALLSTATE LIFE INSURANCE COMPANY

Series 2005-B, Tranche 1, Notes	Series 2005-B, Tranche 2, Notes
$20,000,000
$20,000,000

Register Notes in name of: ALLSTATE LIFE INSURANCE COMPANY

(1)	All payments by Fedwire transfer of immediately available funds or ACH payments, identifying the name of the Issuer, the Private Placement Number and the payment as principal, interest or premium, in the format as follows:
	Bank: Citibank ABA #: 021000089 Account Name: Allstate Life Insurance Company Collection Account - PP Account #: 30547007 Reference: OBI [Insert 9-digit Private Placement No., Credit Name, Coupon, Maturity here], Payment Due Date (MM/DD/YY) and the type and amount of payment being made.           For example:           P___ ( Enter “P” and amount of principal being remitted,           for example, P5000000.00) -           I___ (Enter “I” and amount of interest being remitted,           for example, I225000.00)
(2)	All notices of scheduled payments and written confirmations of such wire transfers:
	Allstate Investments LLC Investment Operations - Private Placements 3075 Sanders Road, STE G4A Northbrook, IL 60062-7127 Telephone: (847) 402-6672 Private Placements Telecopy: (847) 326-7032 E-Mail: PrivateIOD@allstate.com

Schedule A

(3)	All financial reports, compliance certificates and all other written communications, including notice of prepayments, to be sent by email (PrivateCompliance@allstate.com) or hard copy to:
	Allstate Investments LLC Private Placements Department 3075 Sanders Road, STE G5D Northbrook, Illinois 60062-7127 Telephone: (847) 402-7117 Telecopy: (847) 402-3092
(4)	Securities to be delivered to:
	Citibank N.A. 333 West 34th Street 3rd Floor Securities Vault New York, NY 10001 Attn: Danny Reyes For Allstate Life Insurance Company/Safekeeping Account No. 846627
(5)	One set of closing documents and two conformed copies of each of the principal documents to be delivered to:
	Peter McElvain Counsel Allstate Investments, LLC 3075 Sanders Road, Suite G5A Northbrook, IL 60062-7127 Fax: 847/402-6639 Email: pmcelvai@allstate.com
(6)	Tax ID No. 36-2554642

Schedule A

INFORMATION RELATING TO PURCHASERS

	Principal Amount of Notes to be Purchased
Name of Purchaser	Series 2005-A, Tranche 1, Notes	Series 2005-A, Tranche 2, Notes
TRANSAMERICA LIFE INSURANCE AND ANNUITY COMPANY		$7,000,000

Series 2005-B, Tranche 1, Notes Series 2005-B, Tranche 2, Notes

Register Notes in name of: TRANSAMERICA LIFE INSURANCE AND ANNUITY COMPANY

(1)	All payments on account of the TRANSAMERICA LIFE INSURANCE AND ANNUITY COMPANY shall be made by wire transfer of immediately available funds. Wire instructions should include source and application of funds (principal and/or interest amount) along with security/issuer description and CUSIP to:
	Boston Safe Deposit Trust ABA# - 011001234 Credit DDA Account # 125261 Attn: MBS Income, cc1253 FFC TALIAC TRAF1506102
(2)	All notices of payments and written confirmations of such wire transfers:
	AEGON USA Investment Management, LLC Attn: Custody Operations-Privates 4333 Edgewood Road NE Cedar Rapids, IA 52499-7013 Email: paymentnotifications@aegonusa.com
(3)	Routine correspondence and reporting:

AEGON USA Investment Management, LLC	AEGON USA Investment Management, LLC
Attn: Director of Private Placements	Attn: Lizz Taylor – Private Placements
4333 Edgewood Road N.E.	400 West Market Street
Cedar Rapids, IA 52499-5335	Louisville, KY 40202
Phone: 319-369-2432	Phone: 502-560-2639
Fax: 319-369-2666	Fax: 502-560-2030

Schedule A

(4)   Legal / Closing Documents (one set to each location):

AEGON USA Investment Management, LLC	AEGON USA Investment Management, LLC
Attn: Director of Private Placements	Attn: Paul Houk, Esquire
4333 Edgewood Road N.E.	Investment Legal Department
Cedar Rapids, IA 52499-5335	400 West Market Street, 10th Floor
	Louisville, KY 40202

(5)   Tax ID No. 95-6140222

Schedule A

INFORMATION RELATING TO PURCHASERS

	Principal Amount of Notes to be Purchased
Name of Purchaser	Series 2005-A, Tranche 1, Notes	Series 2005-A, Tranche 2, Notes
MONUMENTAL LIFE INSURANCE COMPANY

Series 2005-B, Tranche 1, Notes	Series 2005-B, Tranche 2, Notes
$20,000,000

Register Notes in name of: MONUMENTAL LIFE INSURANCE COMPANY

(1)	All payments on account of the MONUMENTAL LIFE INSURANCE COMPANY shall be made by wire transfer of immediately available funds. Wire instructions should include source and application of funds (principal and/or interest amount) along with security/issuer description and CUSIP to:
	Citibank, NA 111 Wall Street New York, NY 10043 ABA # 021-000-089 DDA # 36218394 FFC MonLife Private 851217
(2)	All notices of payments and written confirmations of such wire transfers:
	AEGON USA Investment Management, LLC Attn: Custody Operations-Privates 4333 Edgewood Road NE Cedar Rapids, IA 52499-7013 Email: paymentnotifications@aegonusa.com
(3)	Routine correspondence and reporting:

AEGON USA Investment Management, LLC	AEGON USA Investment Management, LLC
Attn: Director of Private Placements	Attn: Lizz Taylor – Private Placements
4333 Edgewood Road N.E.	400 West Market Street
Cedar Rapids, IA 52499-5335	Louisville, KY 40202
Phone: 319-369-2432	Phone: 502-560-2639
Fax: 319-369-2666	Fax: 502-560-2030

Schedule A

(4)   Legal / Closing Documents (one set to each location):

AEGON USA Investment Management, LLC	AEGON USA Investment Management, LLC
Attn: Director of Private Placements	Attn: Paul Houk, Esquire
4333 Edgewood Road N.E.	Investment Legal Department
Cedar Rapids, IA 52499-5335	400 West Market Street, 10th Floor
	Louisville, KY 40202

(5)   Tax ID No. 52-0419790

Schedule A

INFORMATION RELATING TO PURCHASERS

	Principal Amount of Notes to be Purchased
Name of Purchaser	Series 2005-A, Tranche 1, Notes	Series 2005-A, Tranche 2, Notes
ING USA ANNUITY AND LIFE INSURANCE COMPANY		$ 7,000,000
	Series 2005-B, Tranche 1, Notes	Series 2005-B, Tranche 2, Notes

Register Notes in name of: ING USA ANNUITY AND LIFE INSURANCE COMPANY

(1)	All payments on account of Notes held by such purchaser shall be made by wire transfer of immediately available funds for credit to:
	The Bank of New York BFN: IOC 566/INST’L CUSTODY (for scheduled     principal and interest payments) ABA#: 021000018 Ref.: ING USA Annuity and Life Insurance Co. -              Separate Account, Acct. No. 136374              and [insert Cusip No.]
	or
	BFN: IOC 565/INST’L CUSTODY (for all payments other than scheduled principal and interest) ABA#: 021000018 Ref.: ING USA Annuity and Life Insurance Co. -              Separate Account, Acct. No. 136374              and [insert Cusip No.]
	Each such wire transfer shall set forth the name of the Issuer, the full title (including the coupon rate, issuance date, and final maturity date) of the Notes on account of which such payment is made, a reference to the PPN, and the due date and application (as among principal, premium and interest) of the payment being made.
(2)	All notices of payments and written confirmations of such wire transfers:
	ING Investment Management LLC 5780 Powers Ferry Road, NW, Suite 300 Atlanta, GA 30327-4349 Attn: Operations/Settlements Fax: (770) 690-4886

Schedule A

(3)	All other communications:
	ING Investment Management LLC 100 Washington Avenue South, Suite 1635 Minneapolis, MN 55401-2121 Attn: Robert Boucher Phone: (612) 342-3371 Fax: (612) 372-5368
	with copy to:
	ING Investment Management LLC 5780 Powers Ferry Road, NW, Suite 300 Atlanta, GA 30327-4349 Attn: Private Placements Fax: (770) 690-5057
(4)	Note Delivery Instructions:
	The Bank of New York One Wall Street Window A - 3rd Floor New York, NY 10286
	with copy to:
	ING Investment Management LLC 5780 Powers Ferry Road, NW, Suite 300 Atlanta, GA 30327-4349 Attn: Private Placements Fax: (770) 690-5057
	Please include in the cover letter accompanying the Notes a reference to the Purchaser’s account number (ING USA SA – Acct. No. 136374).
(5)	Tax ID No. 41-0991508

Schedule A

INFORMATION RELATING TO PURCHASERS

	Principal Amount of Notes to be Purchased
Name of Purchaser	Series 2005-A, Tranche 1, Notes	Series 2005-A, Tranche 2, Notes
RELIASTAR LIFE INSURANCE COMPANY		$	15,000,000
	Series 2005-B, Tranche 1, Notes	Series 2005-B, Tranche 2, Notes

Register Notes in name of: RELIASTAR LIFE INSURANCE COMPANY

(1)	All payments on account of Notes held by such purchaser shall be made by wire transfer of immediately available funds for credit to:
	The Bank of New York BFN: IOC 566/INST’L CUSTODY (for scheduled principal and interest payments) ABA#: 021000018 Ref.: ReliaStar Life Insurance Company,           Acct. No. 187035 and [insert Cusip No.]
	or
	BFN: IOC 565/INST’L CUSTODY (for all payments other than scheduled principal and interest) ABA#: 021000018 Ref.: ReliaStar Life Insurance Company,           Acct. No. 187035 and [insert Cusip No.]
	Each such wire transfer shall set forth the name of the Issuer, the full title (including the coupon rate, issuance date, and final maturity date) of the Notes on account of which such payment is made, a reference to the PPN, and the due date and application (as among principal, premium and interest) of the payment being made.
(2)	All notices of payments and written confirmations of such wire transfers:
	ING Investment Management LLC 5780 Powers Ferry Road, NW, Suite 300 Atlanta, GA 30327-4349 Attn: Operations/Settlements Fax: (770) 690-4886

Schedule A

(3)	All other communications:
	ING Investment Management LLC 100 Washington Avenue South, Suite 1635 Minneapolis, MN 55401-2121 Attn: Robert Boucher Phone: (612) 342-3371 Fax: (612) 372-5368
	with copy to:
	ING Investment Management LLC 5780 Powers Ferry Road, NW, Suite 300 Atlanta, GA 30327-4349 Attn: Private Placements Fax: (770) 690-5057
(4)	Note Delivery Instructions:
	The Bank of New York One Wall Street Window A - 3rd Floor New York, NY 10286
	with copy to:
	ING Investment Management LLC 5780 Powers Ferry Road, NW, Suite 300 Atlanta, GA 30327-4349 Attn: Private Placements Fax: (770) 690-5057
	Please include in the cover letter accompanying the Notes a reference to the Purchaser’s account number (RLI – Acct. No. 187035).
(5)	Tax ID No. 41-0451140

Schedule A

INFORMATION RELATING TO PURCHASERS

	Principal Amount of Notes to be Purchased
Name of Purchaser	Series 2005-A, Tranche 1, Notes	Series 2005-A, Tranche 2, Notes
ING LIFE INSURANCE AND ANNUITY COMPANY		$	3,000,000
	Series 2005-B, Tranche 1, Notes	Series 2005-B, Tranche 2, Notes

Register Notes in name of: ING LIFE INSURANCE AND ANNUITY COMPANY

(1)	All payments on account of Notes held by such purchaser shall be made by wire transfer of immediately available funds for credit to:
	The Bank of New York ABA#: 021000018 BFN: IOC 566 (for scheduled principal and interest payments) Attn: P&I Department Ref.: ING Life Insurance and Annuity Company,           Acct. No. 216101 and [insert Cusip No.]
	or
	BFN: IOC 565/INST’L CUSTODY (for all payments other than scheduled principal and interest) Attn: P&I Department Ref.: ING Life Insurance and Annuity Company,           Acct. No. 216101 and [insert Cusip No.]
	Each such wire transfer shall set forth the name of the Issuer, the full title (including the coupon rate, issuance date, and final maturity date) of the Notes on account of which such payment is made, a reference to the PPN, and the due date and application (as among principal, premium and interest) of the payment being made.
(2)	All notices of payments and written confirmations of such wire transfers:
	ING Investment Management LLC 5780 Powers Ferry Road, NW, Suite 300 Atlanta, GA 30327-4349 Attn: Operations/Settlements Fax: (770) 690-4886

Schedule A

(3)	All other communications:
	ING Investment Management LLC 100 Washington Avenue South, Suite 1635 Minneapolis, MN 55401-2121 Attn: Robert Boucher Phone: (612) 342-3371 Fax: (612) 372-5368
	with copy to:
	ING Investment Management LLC 5780 Powers Ferry Road, NW, Suite 300 Atlanta, GA 30327-4349 Attn: Private Placements Fax: (770) 690-5057
(4)	Note Delivery Instructions:
	The Bank of New York One Wall Street Window A - 3rd Floor New York, NY 10286
	with copy to:
	ING Investment Management LLC 5780 Powers Ferry Road, NW, Suite 300 Atlanta, GA 30327-4349 Attn: Private Placements Fax: (770) 690-5057
	Please include in the cover letter accompanying the Notes a reference to the Purchaser’s account number (ALA – Acct. No. 216101).
(5)	Tax ID No. 71-0294708

Schedule A

INFORMATION RELATING TO PURCHASERS

	Principal Amount of Notes to be Purchased
Name of Purchaser	Series 2005-A, Tranche 1, Notes		Series 2005-A, Tranche 2, Notes
RELIASTAR LIFE INSURANCE COMPANY	$	1,300,000	$	15,000,000
	$	3,000,000
	$	3,000,000
	$	2,000,000
	Series 2005-B, Tranche 1, Notes		Series 2005-B, Tranche 2, Notes

Register Notes in name of: CIG & CO.

(1)	All payments by wire transfer of immediately available funds to:
	J.P. Morgan Chase Bank BNF=CIGNA Private Placements/AC=9009001802 ABA #021000021 OBI=[name of company; description of security; interest rate; maturity date; PPN/CUSIP]
(2)	All notices of payments and written confirmations of such wire transfers:
	CIG & Co. c/o CIGNA Investments, Inc. Attention: Fixed Income Securities, H16B 280 Trumbull Street Hartford, CT 06103 Fax: 860-727-8024
	Copy to:
	J.P. Morgan Chase Bank 14201 Dallas Parkway, 13th Floor Dallas, TX 75254 Attention: Heather Frisina Mail Code 300-116 Fax: 469-477-1904

Schedule A

(3)	All other communications:
	CIG & Co. c/o CIGNA Investments, Inc. Attention: Fixed Income Securities, H16B 280 Trumbull Street Hartford, CT 06103 Fax: 860-727-8024
(4)	After closing one set of closing documents per entity and four conformed copies should be sent to:
	CIGNA Investment Management Private Investments 280 Trumbull Street Hartford, Connecticut 06103 Attention: Operations Group, H16B
(5)	Delivery of Notes, along with transmittal form, to:
	J.P. Morgan Chase Bank 4 New York Plaza New York, NY 10004 Attn: John Bouquet
	Copy to:
	Carol Parsell Cigna Investments, Inc. 280 Trumbull Street Hartford, CT 06103
(6)	Tax ID No. 13-3574027

Schedule A

INFORMATION RELATING TO PURCHASERS

	Principal Amount of Notes to be Purchased
Name of Purchaser	Series 2005-A, Tranche 1, Notes		Series 2005-A, Tranche 2, Notes
CIGNA LIFE INSURANCE COMPANY OF NEW YORK	$	1,300,000	$	1,000,000
	Series 2005-B, Tranche 1, Notes		Series 2005-B, Tranche 2, Notes

Register Notes in name of: CIG & CO.

(1)	All payments by wire transfer of immediately available funds to:
	J.P. Morgan Chase Bank BNF=CIGNA Private Placements/AC=9009001802 ABA #021000021 OBI=[name of company; description of security; interest rate; maturity date; PPN/CUSIP]
(2)	All notices of payments and written confirmations of such wire transfers:
	CIG & Co. c/o CIGNA Investments, Inc. Attention: Fixed Income Securities, H16B 280 Trumbull Street Hartford, CT 06103 Fax: 860-727-8024
	Copy to:
	J.P. Morgan Chase Bank 14201 Dallas Parkway, 13th Floor Dallas, TX 75254 Attention: Heather Frisina Mail Code 300-116 Fax: 469-477-1904
(3)	All other communications:
	CIG & Co. c/o CIGNA Investments, Inc. Attention: Fixed Income Securities, H16B 280 Trumbull Street Hartford, CT 06103 Fax: 860-727-8024

Schedule A

(4)	After closing one set of closing documents per entity and four conformed copies should be sent to:
	CIGNA Investment Management Private Investments 280 Trumbull Street Hartford, Connecticut 06103 Attention: Operations Group, H16B
(5)	Delivery of Notes, along with transmittal form, to:
	J.P. Morgan Chase Bank 4 New York Plaza New York, NY 10004 Attn: John Bouquet
	Copy to:
	Carol Parsell Cigna Investments, Inc. 280 Trumbull Street Hartford, CT 06103
(6)	Tax ID No. 13-3574027

Schedule A

INFORMATION RELATING TO PURCHASERS

	Principal Amount of Notes to be Purchased
Name of Purchaser	Series 2005-A, Tranche 1, Notes		Series 2005-A, Tranche 2, Notes
LIFE INSURANCE COMPANY OF NORTH AMERICA	$	6,400,000	$	3,000,000

Series 2005-B, Tranche 1, Notes Series 2005-B, Tranche 2, Notes

Register Notes in name of: CIG & CO.

(1)	All payments by wire transfer of immediately available funds to:
	J.P. Morgan Chase Bank BNF=CIGNA Private Placements/AC=9009001802 ABA #021000021 OBI=[name of company; description of security; interest rate; maturity date; PPN/CUSIP]
(2)	All notices of payments and written confirmations of such wire transfers:
	CIG & Co. c/o CIGNA Investments, Inc. Attention: Fixed Income Securities, H16B 280 Trumbull Street Hartford, CT 06103 Fax: 860-727-8024
	Copy to:
	J.P. Morgan Chase Bank 14201 Dallas Parkway, 13th Floor Dallas, TX 75254 Attention: Heather Frisina Mail Code 300-116 Fax: 469-477-1904
(3)	All other communications:
	CIG & Co. c/o CIGNA Investments, Inc. Attention: Fixed Income Securities, H16B 280 Trumbull Street Hartford, CT 06103 Fax: 860-727-8024

Schedule A

(4)	After closing one set of closing documents per entity and four conformed copies should be sent to:
	CIGNA Investment Management Private Investments 280 Trumbull Street Hartford, Connecticut 06103 Attention: Operations Group, H16B
(5)	Delivery of Notes, along with transmittal form, to:
	J.P. Morgan Chase Bank 4 New York Plaza New York, NY 10004 Attn: John Bouquet
	Copy to:
	Carol Parsell Cigna Investments, Inc. 280 Trumbull Street Hartford, CT 06103
(6)	Tax ID No. 13-3574027

Schedule A

INFORMATION RELATING TO PURCHASERS

	Principal Amount of Notes to be Purchased
Name of Purchaser	Series 2005-A, Tranche 1, Notes		Series 2005-A, Tranche 2, Notes
TEACHERS INSURANCE AND ANNUITY ASSOCIATION OF AMERICA	$	10,000,000	$	10,000,000
	Series 2005-B, Tranche 1, Notes		Series 2005-B, Tranche 2, Notes

Register Notes in name of: TEACHERS INSURANCE AND ANNUITY ASSOCIATION OF AMERICA

(1)	All payments on or in respect of the Notes shall be made in immediately available funds at the opening of business on the due date by electronic funds transfer through the Automated Clearing House System to:
	Chase Manhattan Bank ABA No. 021-000-021 Account of: Teachers Insurance and Annuity Association of America Account No.: 900-9-000200 For further Credit to the TIAA Account Number: G07040 Reference: PPN#/Issuer/Mat. Date/Coupon Rate/P&I Breakdown
(2)	Contemporaneous with the above electronic funds transfer, advice setting forth (1) the full name, private placement number and interest rate of the Note, (2) allocation of payment between principal, interest, premium and any special payment; and (3) name and address of Bank (or Trustee) from which wire transfer was sent, shall be delivered, mailed or faxed to:

Teachers Insurance and Annuity Association of America

730 Third Avenue

New York, New York 10017-3206

Attention: Securities Accounting Division

Telephone:  (212) 916-6004

Fax:  (212) 916-6955

(3)   All other communications shall be delivered or mailed to:

Teachers Insurance and Annuity Association of America

730 Third Avenue

New York, New York 10017-3206

Attention: Securities Division/Lisa Ferraro

Telephone:  (212) 916-6547 (Telephone Number)

(212) 490-9000 (General Telephone Number)

Fax:  (212) 916-6667 (Telecopier Number)

Schedule A

(4)   Tax ID No. 13-1624203

Schedule A

INFORMATION RELATING TO PURCHASERS

	Principal Amount of Notes to be Purchased
Name of Purchaser	Series 2005-A, Tranche 1, Notes	Series 2005-A, Tranche 2, Notes
JACKSON NATIONAL LIFE INSURANCE COMPANY - GIC ACCOUNT
	Series 2005-B, Tranche 1, Notes	Series 2005-B, Tranche 2, Notes
		$	7,500,000

Register Notes in name of: JACKSON NATIONAL LIFE INSURANCE COMPANY

(1)	Please wire all payments as follows. To ensure accurate and timely posting of principal and interest, please include all relevant information on the wire.
	The Bank of New York ABA # 021-000-018 BNF Account #: IOC566 FBO: Jackson National Life Ref: CUSIP / PPN, Description, and Breakdown (P&I)
(2)	Original physical notes & certificates should be delivered as follows:
	The Bank of New York Special Processing – Window A One Wall Street, 3rd Floor New York, NY 10286 Ref: JNL – JNL GIC, A/C # 187243
(3)	DTC Settlement Instructions:
	DTC Participant # 901 Agent Bank # 26500 Institution # 26662 Interested Party # 74323 Account # 187243
(4)	Original documents and copies of notes and certificates, notices, waivers, amendments, consents, and financial information should be sent to:
a)	PPM America, Inc. 225 West Wacker Drive, Suite 1100 Chicago, IL 60606-1228 Attn: Private Placements – Mark Staub Phone: (312) 634-1212, Fax: (312) 634-0054
b)	Jackson National Life Insurance Company 225 West Wacker Drive, Suite 1100 Chicago, IL 60606-1228 Attn: Investment Accounting – Mark Stewart Phone: (312) 338-5832, Fax: (312) 236-5224

Schedule A

(5)	Payment notices should be sent to:
	Jackson National Life Insurance Company C/O The Bank of New York Attn: P&I Department P. O. Box 19266 Newark, New Jersey 07195 Phone: (212) 437-3054, Fax: (212) 437-6466
(6)	Tax ID No. 38-1659835

Schedule A

INFORMATION RELATING TO PURCHASERS

	Principal Amount of Notes to be Purchased
Name of Purchaser	Series 2005-A, Tranche 1, Notes	Series 2005-A, Tranche 2, Notes
JACKSON NATIONAL LIFE INSURANCE COMPANY - ELI ACCOUNT
	Series 2005-B, Tranche 1, Notes	Series 2005-B, Tranche 2, Notes
		$	7,500,000

Register Notes in name of: JACKSON NATIONAL LIFE INSURANCE COMPANY

(1)	Please wire all payments as follows. To ensure accurate and timely posting of principal and interest, please include all relevant information on the wire.
	The Bank of New York ABA # 021-000-018 BNF Account #: IOC566 FBO: Jackson National Life Ref: CUSIP / PPN, Description, and Breakdown (P&I)
(2)	Original physical notes & certificates should be delivered as follows:
	The Bank of New York Special Processing – Window A One Wall Street, 3rd Floor New York, NY 10286 Ref: JNL – JNL ELI, A/C # 187242
(3)	DTC Settlement Instructions:
	DTC Participant # 901 Agent Bank # 26500 Institution # 26662 Interested Party # 74323 Account # 187242
(4)	Original documents and copies of notes and certificates, notices, waivers, amendments, consents, and financial information should be sent to:
a)	PPM America, Inc. 225 West Wacker Drive, Suite 1100 Chicago, IL 60606-1228 Attn: Private Placements – Mark Staub Phone: (312) 634-1212, Fax: (312) 634-0054
b)	Jackson National Life Insurance Company 225 West Wacker Drive, Suite 1100 Chicago, IL 60606-1228 Attn: Investment Accounting — Mark Stewart Phone: (312) 338-5832, Fax: (312) 236-5224

Schedule A

(5)	Payment notices should be sent to:
	Jackson National Life Insurance Company C/O The Bank of New York Attn: P&I Department P. O. Box 19266 Newark, New Jersey 07195 Phone: (212) 437-3054, Fax: (212) 437-6466
(6)	Tax ID No. 38-1659835

Schedule A

INFORMATION RELATING TO PURCHASERS

	Principal Amount of Notes to be Purchased
Name of Purchaser	Series 2005-A, Tranche 1, Notes	Series 2005-A, Tranche 2, Notes
SUN LIFE INSURANCE AND ANNUITY COMPANY OF NEW YORK
	Series 2005-B, Tranche 1, Notes	Series 2005-B, Tranche 2, Notes
		$	8,000,000

Register Notes in name of: SUN LIFE INSURANCE AND ANNUITY COMPANY OF NEW YORK

(1)	Wire Transfers of Principal and Interest are to be directed to:
	Mellon Bank of New England ABA No.: 011001234 / BOS SAFE DEP DDA No.: 125261 Attention: MBS Income CC 1253 Account Name: Sun Life New York – SUN CAPITAL Account No.: KBLF00020002 RE: Regis Corporation
	All wire transfers are to be accompanied by the PPN and by the source and the principal and interest application of the funds.
(2)	Written notice of each routine payment and any audit confirmation is to be sent to Sun Life at:
	One Sun Life Executive Park Wellesley Hills, MA 02481 Attention: Manager, Securities Operations, SC 1395
(3)	All other notices and correspondence, including notices of non-routine payments, are to be forwarded to Sun Life at:
	One Sun Life Executive Park Wellesley Hills, MA 02481 Attention: Investment Division/Private Placements, SC 1303

Schedule A

(4)	Signature pages, funding instructions, and closing documents should be forwarded to:
	Srbui Seferian, Senior Investment Analyst Sun Life Assurance Company of Canada One Sun Life Executive Park, SC 1303 Wellesley Hills, MA 02481 Telephone: (781) 446-3383 Facsimile: (781) 446-2392
(5)	Delivery of Notes to:
	Linda R. Guillette Associate Investment Analyst U.S. Private Placements
(6)	Tax ID No. 04-2845273

Schedule A

INFORMATION RELATING TO PURCHASERS

	Principal Amount of Notes to be Purchased
Name of Purchaser	Series 2005-A, Tranche 1, Notes	Series 2005-A, Tranche 2, Notes
SUN LIFE ASSURANCE COMPANY OF CANADA (U.S.)
	Series 2005-B, Tranche 1, Notes	Series 2005-B, Tranche 2, Notes
		$	7,000,000

Register Notes in name of: SUN LIFE ASSURANCE COMPANY OF CANADA (U.S.)

(1)	Wire Transfers of Principal and Interest are to be directed to:
	Mellon Bank of New England ABA No.: 011001234 / BOS SAFE DEP DDA No.: 125261 Attention: MBS Income CC 1253 Account Name: Sun US – EQUITY INDEX ANNUITIES Account No.: KEYF00310002 RE: Regis Corporation
	All wire transfers are to be accompanied by the PPN and by the source and the principal and interest application of the funds.
(2)	Written notice of each routine payment and any audit confirmation is to be sent to Sun Life at:
	One Sun Life Executive Park Wellesley Hills, MA 02481 Attention: Manager, Securities Operations, SC 1395
(3)	All other notices and correspondence, including notices of non-routine payments, are to be forwarded to Sun Life at:
	One Sun Life Executive Park Wellesley Hills, MA 02481 Attention: Investment Division/Private Placements, SC 1303

Schedule A

(4)	Signature pages, funding instructions, and closing documents should be forwarded to:
	Srbui Seferian, Senior Investment Analyst Sun Life Assurance Company of Canada One Sun Life Executive Park, SC 1303 Wellesley Hills, MA 02481 Telephone: (781) 446-3383 Facsimile: (781) 446-2392
(5)	Delivery of Notes to:
	Linda R. Guillette Associate Investment Analyst U.S. Private Placements
(6)	Tax ID No. 04-2461439

Schedule A

INFORMATION RELATING TO PURCHASERS

	Principal Amount of Notes to be Purchased
Name of Purchaser	Series 2005-A, Tranche 1, Notes	Series 2005-A, Tranche 2, Notes
THE GUARDIAN LIFE INSURANCE COMPANY OF AMERICA		$	13,000,000
	Series 2005-B, Tranche 1, Notes	Series 2005-B, Tranche 2, Notes

Register Notes in name of: THE GUARDIAN LIFE INSURANCE COMPANY OF AMERICA

(1)	All payments by wire transfer of immediately available funds to:
	JP Morgan Chase FED ABA #021000021 Chase/NYC/CTR/BNF A/C 900-9-000200 Reference A/C #G05978, Guardian Life, CUSIP #___, Regis Corporation
(2)	All notices of payments and written confirmations of such wire transfers:
	The Guardian Life Insurance Company of America 7 Hanover Square New York, NY 10004-2616 Attn: Brian Keating Investment Department 20-D FAX # (212) 919-2658/2656
(3)	All other communications:
	The Guardian Life Insurance Company of America 7 Hanover Square New York, NY 10004-2616 Attn: Brian Keating Investment Department 20-D FAX # (212) 919-2658/2656
(4)	Delivery Notes to:
	JP Morgan Chase 4 New York Plaza Ground Floor Receive Window New York, NY 10004 Reference A/C #G05978, Guardian Life

Schedule A

     (5) Tax ID No. 13-5123390

Schedule A

INFORMATION RELATING TO PURCHASERS

	Principal Amount of Notes to be Purchased
Name of Purchaser	Series 2005-A, Tranche 1, Notes	Series 2005-A, Tranche 2, Notes
AMERICAN FAMILY LIFE INSURANCE COMPANY		$	3,000,000
	Series 2005-B, Tranche 1, Notes	Series 2005-B, Tranche 2, Notes

Register Notes in name of: BAND & CO.

(1)	All Payments on or in respect of the Notes to be by bank wire transfer of Federal or other immediately available funds. Each such wire transfer shall set forth the name of the Company, the full title (including the coupon rate and final maturity date) of the Notes, and the due date and application among principal and interest of the payment being made. Payment shall be made to:
	US Bank, N.A. Trust Services 60 Livingston Ave, St Paul, MN 55107-2292 ABA # 091000022 Beneficiary Account #180183083765 FFC to American Family Trust Account #000018012510 for AFLIC-Universal Life Portfolio Credit for CUSIP # ___
(2)	All notices and communications, including notices with respect to payments and written confirmation of each such payment as well as quarterly and annual financial statements, be addressed to:
	AMERICAN FAMILY LIFE INSURANCE COMPANY 6000 American Parkway Madison, WI 53783-0001 Attn: Investment Division-Private Placements
(3)	All other communications:
	AMERICAN FAMILY LIFE INSURANCE COMPANY 6000 American Parkway Madison, WI 53783-0001 Attn: Investment Division-Private Placements

Schedule A

(4)	Delivery of Notes:
	Send special delivery by overnight carrier to:
	US Bank Milwaukee, N.A. Attn: Erika Eckert (MK-LC-1E) Trust Officer, Account Manager 777 E. Wisconsin Ave. Milwaukee, WI 53202
	In addition, a specimen copy of the Note should be sent to American Family Life Insurance Company as addressed above.
(5)	Tax ID No. 39-6040365

Schedule A

INFORMATION RELATING TO PURCHASERS

	Principal Amount of Notes to be Purchased
Name of Purchaser	Series 2005-A, Tranche 1, Notes	Series 2005-A, Tranche 2, Notes
AMERICAN FAMILY LIFE INSURANCE COMPANY		$	2,000,000
	Series 2005-B, Tranche 1, Notes	Series 2005-B, Tranche 2, Notes

Register Notes in name of: BAND & CO.

(1)	All Payments on or in respect of the Notes to be by bank wire transfer of Federal or other immediately available funds. Each such wire transfer shall set forth the name of the Company, the full title (including the coupon rate and final maturity date) of the Notes, and the due date and application among principal and interest of the payment being made. Payment shall be made to:
	US Bank, N.A. Trust Services 60 Livingston Ave, St Paul, MN 55107-2292 ABA # 091000022 Beneficiary Account #180183083765 FFC to American Family Trust Account #000018012800 for AFLIC-Annuities Portfolio Credit for CUSIP # ___
(2)	All notices and communications, including notices with respect to payments and written confirmation of each such payment as well as quarterly and annual financial statements, be addressed to:
	AMERICAN FAMILY LIFE INSURANCE COMPANY 6000 American Parkway Madison, WI 53783-0001 Attn: Investment Division-Private Placements
(3)	All other communications:
	AMERICAN FAMILY LIFE INSURANCE COMPANY 6000 American Parkway Madison, WI 53783-0001 Attn: Investment Division-Private Placements

Schedule A

(4)	Delivery of Notes:
	Send special delivery by overnight carrier to:
	US Bank Milwaukee, N.A. Attn: Erika Eckert (MK-LC-1E) Trust Officer, Account Manager 777 E. Wisconsin Ave. Milwaukee, WI 53202
	In addition, a specimen copy of the Note should be sent to American Family Life Insurance Company as addressed above.
(5)	Tax ID No. 39-6040365

Schedule A

INFORMATION RELATING TO PURCHASERS

	Principal Amount of Notes to be Purchased
Name of Purchaser	Series 2005-A, Tranche 1, Notes		Series 2005-A, Tranche 2, Notes
AMERITAS LIFE INSURANCE CORP.	$	1,000,000	$	1,000,000
	Series 2005-B, Tranche 1, Notes		Series 2005-B, Tranche 2, Notes

Register Notes in name of: CHIMEBOARD & CO.

(1)	All payments by wire transfer of immediately available funds to:
	State Street Bank & Trust Company ABA #011-000-028 BNF: Physical Income Account DDA Clearing Account #00076026 Further Credit - Custody Fund #1EJH for Ameritas Life Insurance Corp. Reference: CUSIP; Issue name and source/application of funds (P&I, etc.)

(2)   All notices of payments and written confirmations of such wire transfers sent in duplicate to:

State Street Bank		Ameritas Life Insurance Corp.
P. O. Box 5756		Ameritas Investment Advisors Inc.
Boston, MA 02206	AND	390 North Cotner Blvd.
Attn: Michael Rodelle		Lincoln, NE 68505
and		Fax #: (402) 467-6970
For Account of State Street,
#1EJH Ameritas Life Insurance Corp.

(3)   All other communications sent in duplicate to:

State Street Bank		Ameritas Life Insurance Corp.
P. O. Box 5756		Ameritas Investment Advisors Inc.
Boston, MA 02206	AND	390 North Cotner Blvd.
Attn: Michael Rodelle		Lincoln, NE 68505
and		Fax #: (402) 467-6970
For Account of State Street,
#1EJH Ameritas Life Insurance Corp.

Schedule A

(4)	Delivery of certificates by registered mail to:
	DTCC/New York Window 55 Water Street New York, NY 10041 Plaza Level - 3rd Floor Attn: Robert Mendez, for the account of State Street, Account #1EJH,   Ameritas Life Insurance Corp.
	With copy of certificates to:
	Jim Mikus Ameritas Investment Advisors Inc. 390 North Cotner Boulevard Lincoln, NE 68505
(5)	Tax ID No. 65-1186912

Schedule A

INFORMATION RELATING TO PURCHASERS

	Principal Amount of Notes to be Purchased
Name of Purchaser	Series 2005-A, Tranche 1, Notes		Series 2005-A, Tranche 2, Notes
AMERITAS VARIABLE LIFE INSURANCE COMPANY	$	1,000,000
	Series 2005-B, Tranche 1, Notes		Series 2005-B, Tranche 2, Notes

Register Notes in name of: CHIMEBELL & CO.

(1)   All payments by wire transfer of immediately available funds to:

     State Street Bank & Trust Company
     ABA #011-000-028
     BNF: Physical Income Account
     DDA Clearing Account #00076026
     Further Credit - Custody Fund #1EJF for Ameritas Variable Life Insurance Company
     Reference: CUSIP; Issue name and source/application of funds (P&I, etc.)

(2)   All notices of payments and written confirmations of such wire transfers sent in duplicate to:

State Street Bank		Ameritas Variable Life Insurance Company
P. O. Box 5756		c/o Ameritas Investment Advisors Inc.
Boston, MA 02206	AND	390 North Cotner Blvd.
Attn: Michael Rodelle		Lincoln, NE 68505
and		Fax #: (402) 467-6970
For Account of State Street,
#1EJF Ameritas Variable Life Insurance Company

(3) All other communications sent in duplicate to:

State Street Bank		Ameritas Variable Life Insurance Company
P. O. Box 5756		c/o Ameritas Investment Advisors Inc.
Boston, MA 02206	AND	390 North Cotner Blvd.
Attn: Michael Rodelle		Lincoln, NE 68505
and		Fax #: (402) 467-6970
For Account of State Street,
#1EJF Ameritas Variable Life Insurance Company

Schedule A

(4)	Delivery of certificates by registered mail to:
	DTCC/New York Window 55 Water Street New York, NY 10041 Plaza Level - 3rd Floor Attn: Robert Mendez, for the account of State Street, Account #1EJF,   Ameritas Variable Life Insurance Company
	With copy of certificates to:
	Jim Mikus Ameritas Investment Advisors Inc. 390 North Cotner Boulevard Lincoln, NE 68505
(5)	Tax ID No. 65-1186917

Schedule A

INFORMATION RELATING TO PURCHASERS

	Principal Amount of Notes to be Purchased
Name of Purchaser	Series 2005-A, Tranche 1, Notes		Series 2005-A, Tranche 2, Notes
RELIASTAR LIFE INSURANCE COMPANY	$	1,000,000	$	1,000,000
	Series 2005-B, Tranche 1, Notes		Series 2005-B, Tranche 2, Notes

Register Notes in name of: CHIMEBRIDGE & CO.

(1)	All payments by wire transfer of immediately available funds to:
	State Street Bank & Trust Company ABA #011-000-028 BNF: Physical Income Account DDA Clearing Account #00076026 Further Credit - Custody Fund #1EJP for Acacia Life Insurance Company Reference: CUSIP; Issue name and source/application of funds (P&I, etc.)
(2)	All notices of payments and written confirmations of such wire transfers sent in duplicate to:

State Street Bank		Acacia Life Insurance Company
P. O. Box 5756		Ameritas Investment Advisors Inc.
Boston, MA 02206	AND	390 North Cotner Blvd.
Attn: Michael Rodelle		Lincoln, NE 68505
and		Fax #: (402) 467-6970
For Account of State Street,
#1EJP Acacia Life Insurance Company

(3)   All other communications sent in duplicate to:

State Street Bank		Acacia Life Insurance Company
P. O. Box 5756		Ameritas Investment Advisors Inc.
Boston, MA 02206	AND	390 North Cotner Blvd.
Attn: Michael Rodelle		Lincoln, NE 68505
and		Fax #: (402) 467-6970
For Account of State Street,
#1EJP Acacia Life Insurance Company

Schedule A

(4)	Delivery of certificates by registered mail to:
	DTCC/New York Window 55 Water Street New York, NY 10041 Plaza Level - 3rd Floor Attn: Robert Mendez, for the account of State Street, Account #1EJP,  Acacia Life Insurance Company
	With copy of certificates to:
	Jim Mikus Ameritas Investment Advisors Inc. 390 North Cotner Boulevard Lincoln, NE 68505

(5)   Tax ID No. 65-1186790

Schedule A

INFORMATION RELATING TO PURCHASERS

	Principal Amount of Notes to be Purchased
Name of Purchaser	Series 2005-A, Tranche 1, Notes	Series 2005-A, Tranche 2, Notes
COUNTRY LIFE INSURANCE COMPANY		$	2,000,000
	Series 2005-B, Tranche 1, Notes	Series 2005-B, Tranche 2, Notes

Register Notes in name of: COUNTRY LIFE INSURANCE COMPANY

(1)	All payments by wire transfer of immediately available funds to:
	Northern Trust Chgo/Trust ABA Number 071000152 Wire Account Number 5186041000 For Further Credit to: 26-02712 Account Name: Country Life Insurance Company Representing P & I on (list security) [BANK]

Accompanying Information	Name of Company:
	Description of Security:
	PPN:
	Due date and application (as among principal, premium and interest) of the payment being made:

(2)	All notices of payments and written confirmations of such wire transfers:
	Country Life Insurance Company Attention: Investment Accounting 1705 N Towanda Avenue Bloomington, IL 61702 Tel: (309) 821-3876 Fax: (309) 821-2800
(3)	All other communications:
	Country Life Insurance Company Attention: Investments 1705 N Towanda Avenue Bloomington, IL 61702 Tel: (309) 821-6260 Fax: (309) 821-6301

Schedule A

(4)	Delivery of Notes:
	The Northern Trust Company Attn: Wayne Johnson 50 South LaSalle Street BB-7 Chicago, IL 60675
(5)	Tax ID No. 37-0808781

Schedule A

INFORMATION RELATING TO PURCHASERS

	Principal Amount of Notes to be Purchased
Name of Purchaser	Series 2005-A, Tranche 1, Notes	Series 2005-A, Tranche 2, Notes
SECURITY FINANCIAL LIFE INSURANCE CO.		$	1,000,000
	Series 2005-B, Tranche 1, Notes	Series 2005-B, Tranche 2, Notes

Register Notes in name of: SECURITY FINANCIAL LIFE INSURANCE CO.

(1)   All payments on or in respect of the Notes shall be made by wire transfer of immediately available funds at the opening of business on the due date to:

	Union Bank & Trust Company 4732 Calvert Street Lincoln NE 68501-2535 ABA No. 104910795
	Account of: Security Financial Life Insurance Co. Account Number: 338 1480
	Each such wire transfer shall set forth the name of the issuer, the full title of the Notes (including the rate and final redemption to maturity date) and application of such funds among principle, premium and interest, if applicable.
(2)	All notices of payments and written confirmations of such wire transfers:
	Security Financial Life Insurance Co. 4000 Pine Lake Road Lincoln, NE 68516 Attention: Investment Division Fax: (402) 458-2170 Phone: (402) 434-9600
(3)	All other communications:
	Security Financial Life Insurance Co. 4000 Pine Lake Road P.O. Box 82248
	Lincoln, NE 68501-2248

Schedule A

(4)	Securities should be delivered to:
	Security Financial Life Insurance Co. 4000 Pine Lake Road Lincoln, NE 68516 Attention: Svetlana Ungar
(5)	Tax ID No. 47-0293990

Schedule A

SCHEDULE B

DEFINED TERMS

          As used herein, the following terms have the respective meanings set forth below or set forth in the Section hereof following such term:

          “Additional Notes” is defined in Section 1.2.

          “Adjusted LIBOR Rate” is defined in Section 1.4(a).

          “Affiliate” means, at any time, and with respect to any Person, (a) any other Person that at such time directly or indirectly through one or more intermediaries Controls, or is Controlled by, or is under common Control with, such first Person, and (b) any Person beneficially owning or holding, directly or indirectly, 10% or more of any class of voting or equity interests of the Company or any Subsidiary or any corporation of which the Company and its Subsidiaries beneficially own or hold, in the aggregate, directly or indirectly, 10% or more of any class of voting or equity interests. As used in this definition, “Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise. Unless the context otherwise clearly requires, any reference to an “Affiliate” is a reference to an Affiliate of the Company.

          “Anti-Terrorism Order” means Executive Order 13224 of September 23, 2001 Blocking Property and Prohibiting Transactions With Persons Who Commit, Threaten to Commit, or Support Terrorism (66 Fed. Reg. 49079 (2001)).

          “Bank Guaranty” means the Subsidiary Guaranty dated as of November 12, 2002 of the Subsidiary Guarantors of Debt outstanding under the Credit Agreement, as such Guaranty may be amended, restated or otherwise modified, and any successor thereto.

          “Banks” means the banks party to the Credit Agreement, including Bank of America, N.A., as administrative agent for such banks.

          “Business Day” means (a) for the purposes of Section 8.6 only, any day other than a Saturday, a Sunday or a day on which commercial banks in New York City are required or authorized to be closed, and (b) for the purposes of any other provision of this Agreement, any day other than a Saturday, a Sunday or a day on which commercial banks in Chicago, Illinois or New York City are required or authorized to be closed; provided that, if the applicable Business Day relates to the determination of LIBOR, a day on which dealings are also carried on in U.S. dollar deposits in the London interbank market.

          “Capital Lease” means, at any time, a lease with respect to which the lessee is required concurrently to recognize the acquisition of an asset and the incurrence of a liability in accordance with GAAP.

Schedule B

          “Closing” is defined in Section 3.

          “Code” means the Internal Revenue Code of 1986, as amended from time to time, and the rules and regulations promulgated thereunder from time to time.

          “Company” means Regis Corporation, a Minnesota corporation.

          “Confidential Information” is defined in Section 20.

          “Consolidated EBITDA” means, for any period, the sum of Consolidated Net Income for such period, plus, to the extent deducted in determining such Consolidated Net Income, (i) federal, state, local and foreign income, value added and similar taxes, (ii) Consolidated Interest Expense, (iii) depreciation and amortization expense and (iv) other non-cash charges.

          “Consolidated EBITDAR” means, for any period, the sum of (i) Consolidated EBITDA for such period and (ii) Rental Expense for such period under all leases other than Capital Leases.

          “Consolidated Fixed Charges” means, for any period, the sum of (i) Rental Expense for such period under all leases other than Capital Leases and (ii) Consolidated Interest Expense for such period.

          “Consolidated Interest Expense” means, for any period, the consolidated interest expense of the Company and its Restricted Subsidiaries for such period determined in accordance with GAAP.

          “Consolidated Net Debt” means, as of any date, outstanding Debt of the Company and its Restricted Subsidiaries as of such date less cash and cash equivalents of the Company and its Restricted Subsidiaries as of such date, each as determined on a consolidated basis in accordance with GAAP.

          “Consolidated Net Income” means, for any period, the net income or loss of the Company and its Restricted Subsidiaries for such period determined on a consolidated basis in accordance with GAAP, but in any event excluding extraordinary or nonrecurring gains or losses.

          “Consolidated Net Worth” means, as of any date, the consolidated stockholders’ equity of the Company and its Restricted Subsidiaries as of such date, determined in accordance with GAAP.

          “Consolidated Total Assets” means, as of any date, the assets and properties of the Company and its Restricted Subsidiaries as of such date, determined on a consolidated basis in accordance with GAAP.

          “Credit Agreement” means the Third Amended and Restated Credit Agreement dated as of April 7, 2005 among the Company, Bank of America, N.A., as Administrative Agent,

Schedule B

2

LaSalle Bank National Association, as Co-Administrative Agent and Swing Line Lender, JP Morgan Chase Bank, N.A., as syndication agent, Wachovia Bank, N.A., as documentation agent, and the other financial institutions party thereto, as such agreement may be hereafter amended, modified, restated, supplemented, refinanced, increased or reduced from time to time, and any successor credit agreement or similar facilities.

     “Debt” with respect to any Person means, at any time, without duplication,

     (a) its liabilities for borrowed money and its redemption obligations in respect of mandatorily redeemable Preferred Stock that can be required to be redeemed prior to the maturity of the Notes;

     (b) its liabilities for the deferred purchase price of property acquired by such Person (excluding accounts payable and other accrued liabilities arising in the ordinary course of business but including all liabilities created or arising under any conditional sale or other title retention agreement with respect to any such property);

     (c) all liabilities appearing on its balance sheet in accordance with GAAP in respect of Capital Leases; and

     (d) all liabilities for borrowed money secured by any Lien with respect to any property owned by such Person (whether or not it has assumed or otherwise become liable for such liabilities); and

     (e) any Guaranty of such Person with respect to liabilities of a type described in any of clauses (a) through (d) hereof.

Debt of any Person shall include all obligations of such Person of the character described in clauses (a) through (d) to the extent such Person remains legally liable in respect thereof notwithstanding that any such obligation is deemed to be extinguished under GAAP.

          “Default” means an event or condition the occurrence or existence of which would, with the lapse of time or the giving of notice or both, become an Event of Default.

          “Default Rate” means that rate of interest that is the greater of (i) 2% per annum above the rate of interest stated in clause (a) of the first paragraph of the Notes or (ii) 2% over the rate of interest publicly announced by Bank of America in Chicago, Illinois as its “base” or “prime” rate.

          “Disclosure Documents” is defined in Section 5.3.

          “Disposition” is defined in Section 10.5.

          “Environmental Laws” means any and all Federal, state, local, and foreign statutes, laws, regulations, ordinances, rules, judgments, orders, decrees, permits, concessions, grants, franchises, licenses, agreements or governmental restrictions relating to pollution and the

Schedule B

3

protection of the environment or the release of any materials into the environment, including but not limited to those related to hazardous substances or wastes, air emissions and discharges to waste or public systems.

          “ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time, and the rules and regulations promulgated thereunder from time to time in effect.

          “ERISA Affiliate” means any trade or business (whether or not incorporated) that is treated as a single employer together with the Company under section 414 of the Code.

          “Event of Default” is defined in Section 11.

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

          “GAAP” means generally accepted accounting principles as in effect from time to time in the United States of America.

          “Governmental Authority” means

          (a) the government of

        (i) the United States of America or any State or other political subdivision thereof, or

        (ii) any jurisdiction in which the Company or any Subsidiary conducts all or any part of its business, or which asserts jurisdiction over any properties of the Company or any Subsidiary, or

     (b) any entity exercising executive, legislative, judicial, regulatory or administrative functions of, or pertaining to, any such government.

          “Guaranty” means, with respect to any Person, any obligation (except the endorsement in the ordinary course of business of negotiable instruments for deposit or collection) of such Person guaranteeing or in effect guaranteeing any indebtedness, dividend or other obligation of any other Person in any manner, whether directly or indirectly, including (without limitation) obligations incurred through an agreement, contingent or otherwise, by such Person:

     (a) to purchase such indebtedness or obligation or any property constituting security therefor;

     (b) to advance or supply funds (i) for the purchase or payment of such indebtedness or obligation, or (ii) to maintain any working capital or other balance sheet condition or any income statement condition of any other Person or otherwise to advance or make available funds for the purchase or payment of such indebtedness or obligation;

Schedule B

4

     (c) to lease properties or to purchase properties or services primarily for the purpose of assuring the owner of such indebtedness or obligation of the ability of any other Person to make payment of the indebtedness or obligation; or

     (d) otherwise to assure the owner of such indebtedness or obligation against loss in respect thereof.

In any computation of the indebtedness or other liabilities of the obligor under any Guaranty, the indebtedness or other obligations that are the subject of such Guaranty shall be assumed to be direct obligations of such obligor.

          “Hazardous Material” means any and all pollutants, toxic or hazardous wastes or any other substances that might pose a hazard to health or safety, the removal of which may be required or the generation, manufacture, refining, production, processing, treatment, storage, handling, transportation, transfer, use, disposal, release, discharge, spillage, seepage, or filtration of which is or shall be restricted, prohibited or penalized by any applicable law (including, without limitation, asbestos, urea formaldehyde foam insulation and polycholorinated biphenyls).

          “holder” means, with respect to any Note, the Person in whose name such Note is registered in the register maintained by the Company pursuant to Section 13.1.

          “INHAM Exemption” is defined in Section 6.2(e).

          “Institutional Investor” means (a) any original purchaser of a Note, (b) any holder of more than $2,000,000 in aggregate principal amount of the Notes at the time outstanding, and (c) any bank, trust company, savings and loan association or other financial institution, any pension plan, any investment company, any insurance company, any broker or dealer, or any other similar financial institution or entity, regardless of legal form.

          “Intercreditor Agreement” means the Amended and Restated Intercreditor Agreement dated as of April 7, 2005 among the Revolving Lenders (as defined therein), the Noteholders (as defined therein) and Bank of America, N.A., as Agent for the Revolving Lenders under the Credit Agreement and as Administrative Agent for the Revolving Lenders and the Noteholders.

          “Interest Period” is defined in Section 1.4(c).

          “LIBOR” is defined in Section 1.4(a).

          “LIBOR Breakage Amount” is defined in Section 8.7.

          “Investments” means all investments made, in cash or by delivery of property, directly or indirectly, by any Person, in any other Person, whether by acquisition of shares of capital stock, indebtedness or other obligations or securities or by loan, Guaranty, advance, capital contribution or otherwise.

Schedule B

5

          “Lien” means, with respect to any Person, any mortgage, lien, pledge, charge, security interest or other encumbrance, or any interest or title of any vendor, lessor, lender or other secured party to or of such Person under any conditional sale or other title retention agreement or Capital Lease, upon or with respect to any property or asset of such Person (including in the case of stock, stockholder agreements, voting trust agreements and all similar arrangements).

          “Make-Whole Amount” is defined in Section 8.6.

          “Material” means material in relation to the business, operations, affairs, financial condition, assets or properties of the Company and its Restricted Subsidiaries taken as a whole.

          “Material Adverse Effect” means a material adverse effect on (a) the business, operations, affairs, financial condition, assets or properties of the Company and its Restricted Subsidiaries taken as a whole, or (b) the ability of the Company to perform its obligations under this Agreement and the Notes, or (c) the ability of any Subsidiary to perform its obligations under the Subsidiary Guaranty, or (d) the validity or enforceability of this Agreement (including any Supplement), the Notes or the Subsidiary Guaranty.

          “Material Subsidiary” means any Restricted Subsidiary that accounts for more than (i) 5% of the consolidated assets of the Company and its Restricted Subsidiaries taken as a whole or (ii) 5% of the consolidated revenue of the Company and its Restricted Subsidiaries taken as a whole.

          “Memorandum” is defined in Section 5.3.

          “Moody’s” means Moody’s Investors Service, Inc.

          “Multiemployer Plan” means any Plan that is a “multiemployer plan” (as such term is defined in section 4001(a)(3) of ERISA).

          “NAIC Annual Statement” is defined in Section 6.2(a).

          “Notes” is defined in Section 1.2.

          “Officer’s Certificate” means a certificate of a Senior Financial Officer or of any other officer of the Company whose responsibilities extend to the subject matter of such certificate.

          “Other Purchasers” is defined in Section 2.

          “PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in ERISA or any successor thereto.

Schedule B

6

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

          “Plan” means an “employee benefit plan” (as defined in section 3(3) of ERISA) that is or, within the preceding five years, has been established or maintained, or to which contributions are or, within the preceding five years, have been made or required to be made, by the Company or any ERISA Affiliate or with respect to which the Company or any ERISA Affiliate may have any liability.

          “Preferred Stock” means any class of capital stock of a corporation that is preferred over any other class of capital stock of such corporation as to the payment of dividends or the payment of any amount upon liquidation or dissolution of such corporation.

          “Priority Debt” means, as of any date, the sum (without duplication) of (a) outstanding unsecured Debt of Restricted Subsidiaries that are not Subsidiary Guarantors (other than (i) Debt owed to the Company or any other Restricted Subsidiary, (ii) Debt of a Person outstanding at the time it becomes a Restricted Subsidiary (other than an Unrestricted Subsidiary that has been redesignated as a Restricted Subsidiary) provided that such Debt was not incurred in contemplation of such Person’s becoming a Restricted Subsidiary and (iii) all Guaranties of Debt of the Company by any Restricted Subsidiary that has also guaranteed the Notes and (b) all Debt of the Company and its Restricted Subsidiaries secured by Liens other than Debt secured by Liens permitted by Sections 10.5(a) through (h).

          “Private Shelf Agreement” means the Amended and Restated Private Shelf Agreement dated as of October 3, 2000 between the Company and the purchasers named therein, as amended by Letter Agreement dated as of May 9, 2002 and Letter Amendment no.2 dated as of February 28, 2003, as such agreement may be amended, restated or otherwise modified, and any successor thereto.

          “property” or “properties” means, unless otherwise specifically limited, real or personal property of any kind, tangible or intangible, choate or inchoate.

          “Purchaser” means each purchaser listed in Schedule A.

          “QPAM Exemption” is defined in Section 6.2(d).

          “Qualified Institutional Buyer” means any Person who is a “qualified institutional buyer” within the meaning of such term as set forth in Rule 144A(a)(1) under the Securities Act.

          “Rental Expense” means, for any period, the sum of (i) all store rental payments, (ii) all common area maintenance payments and (iii) all real estate taxes paid by the Company and its Restricted Subsidiaries for such period.

Schedule B

7

          “Required Holders” means, at any time, the holders of at least a majority in principal amount of the Notes at the time outstanding (exclusive of Notes then owned by the Company or any of its Affiliates and any Notes held by Persons who are contractually required to abstain from voting with respect to matters affecting the holders of the Notes).

          “Responsible Officer” means any Senior Financial Officer and any other officer of the Company with responsibility for the administration of the relevant portion of this Agreement.

          “Restricted Subsidiary” means any Subsidiary Guarantor and any other Subsidiary (a) of which at least a majority of the voting securities are owned by the Company and/or one or more Wholly Owned Restricted Subsidiaries and (b) that the Company has not designated an Unrestricted Subsidiary by notice in writing given to the holders of the Notes.

          “S&P” means Standard & Poor’s Ratings Group, a division of McGraw Hill, Inc.

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

          “Senior Debt” means, as of the date of any determination thereof, all Consolidated Debt, other than Subordinated Debt.

          “Senior Financial Officer” means the chief financial officer, principal accounting officer, Vice President, Finance, treasurer or comptroller of the Company.

          “Series 2005 Notes” is defined in Section 1.1.

          “Series 2005-A Notes” is defined in Section 1.1.

          “Series 2005-A, Tranche 1, Notes” is defined in Section 1.1.

          “Series 2005-A, Tranche 2, Notes” is defined in Section 1.1.

          “Series 2005-B Notes” is defined in Section 1.1.

          “Series 2005-B, Tranche 1, Notes” is defined in Section 1.1.

          “Series 2005-B, Tranche 2, Notes” is defined in Section 1.1.

          “Source” is defined in Section 6.2.

          “Subordinated Debt” means all unsecured Debt of the Company that contains or has applicable thereto subordination provisions providing for the subordination thereof to other Debt of the Company (including the Notes).

Schedule B

8

          “Subsidiary” means, as to any Person, any corporation, association or other business entity in which such Person or one or more of its Subsidiaries or such Person and one or more of its Subsidiaries owns sufficient equity or voting interests to enable it or them (as a group) ordinarily, in the absence of contingencies, to elect a majority of the directors (or Persons performing similar functions) of such entity, and any partnership, limited liability company or joint venture if more than a 50% interest in the profits or capital thereof is owned by such Person or one or more of its Subsidiaries or such Person and one or more of its Subsidiaries (unless such partnership, limited liability company or joint venture can and does ordinarily take major business actions without the prior approval of such Person or one or more of its Subsidiaries). Unless the context otherwise clearly requires, any reference to a “Subsidiary” is a reference to a Subsidiary of the Company.

          “Subsidiary Guarantor” is defined in Section 1.3(a).

          “Subsidiary Guaranty” is defined in Section 1.3(a).

          “Supplement” is defined in Section 1.2.

          “this Agreement” or “the Agreement” is defined in Section 17.3.

          “Unrestricted Subsidiary” means any Subsidiary of the Company that has been so designated by notice in writing given to the holders of the Notes.

          “USA Patriot Act” means United States Public Law 107-56, Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT ACT) Act of 2001, as amended from time to time, and the rules and regulations promulgated thereunder from time to time in effect.

          “Voting Stock” means the capital stock of any class or classes of a corporation having power under ordinary circumstances to vote for the election of members of the board of directors of such corporation, or person performing similar functions (irrespective of whether or not at the time stock of any of the class or classes shall have or might have special voting power or rights by reason of the happening of any contingency).

          “Wholly Owned Subsidiary” or “Wholly Owned Restricted Subsidiary” mean, at any time, any Subsidiary, or Restricted Subsidiary, as the case may be, 100% of all of the equity interests (except directors’ qualifying shares) and voting interests of which are owned by any one or more of the Company and the Company’s other Wholly Owned Subsidiaries or Wholly Owned Restricted Subsidiaries, as the case may be, at such time.

Schedule B

9

SCHEDULE 4.9

CHANGES IN CORPORATE STRUCTURE

None.

Schedule 4.9

SCHEDULE 5.3

DISCLOSURE MATERIALS

None.

Schedule 5.3

SCHEDULE 5.4

SUBSIDIARIES AND AFFILIATES

Subsidiaries of		% Ownership
Regis Corporation	Jurisdiction	Structure
1. The Barbers, Hairstyling for Men & Women, Inc.	Minnesota	100.00% Regis Corporation
A. WCH, Inc.*	Minnesota	100.00% The Barbers, Hairstyling for
		Men & Women, Inc.
1. We Care Hair Realty, Inc.*	Delaware	100.00% WCH, Inc.
2. Supercuts, Inc.	Delaware	100% Regis Corporation
A. Supercuts Corporate Shops, Inc.	Delaware	100% Supercuts, Inc.
B. Super Rico, Inc.	Puerto Rico	100% Supercuts, Inc.
C. Tulsa’s Best Haircut LLC	Oklahoma	50% Supercuts, Inc.
3. RPC Acquisition Corp.	Minnesota	100.00% Regis Corporation
4. Regis Corp.	Minnesota	100.00% Regis Corporation
5. Regis Insurance Group, Inc.	Vermont	100.00% Regis Corporation
6. Trade Secret, Inc.	Colorado	100.00% Regis Corporation
7. Regis, Inc.	Minnesota	100.00% Regis Corporation
8. First Choice Haircutters International Corp.	Delaware	100.00% Regis Corporation
9. Cutco Acquisition Corp.	Minnesota	100.00% Regis Corporation
A. 10 Inactive Subsidiaries *		100.00% Cutco Acquisition Corp.
10. Regis International Ltd.	Minnesota	100.00% Regis Corporation
A. Regis Europe, Ltd *	United Kingdom	100.00% Regis International Ltd
1. Essanelle Ltd *	United Kingdom	100.00% Regis Europe Ltd.
B. Blinkers Group, Ltd	United Kingdom	100.00% Regis International Ltd
1. Blinkers Property, Ltd	United Kingdom	100.00% Blinkers Group, Ltd

Schedule 5.4

Subsidiaries of		% Ownership
Regis Corporation	Jurisdiction	Structure
11. N.A.H.C. Acquisition LLC*	Minnesota	100.00% Regis Corporation
12. Regis Hairstylists, Ltd	Yukon	100.00% Regis Corporation
A. First Choice Haircutters, Ltd	Yukon	100.00% Regis Hairstylists, Ltd
1. First Choice Haircutters Realty, Inc. *	Canada Federal	100.00% First Choice Haircutters, Ltd.
B. Magicuts Zee, Inc.	Yukon	100.00% Regis Hairstylists, Ltd
C. Mission Enterprises, Inc.*	Ontario	100.00% Regis Hairstylists, Ltd
13. Regis Cuts Acquisition Corp.	Nova Scotia	100.00% Regis Corporation
14. Daljit Ltd	Delaware	100.00% Regis Corporation
A. 11 US Subsidiaries in New York City		100.00% Daljit Ltd
15. Mary Lentine School of Hair Design, Inc.	Massachusetts	100.00% Regis Corporation
16. Melrose Beauty Academy, Inc.	Massachusetts	100.00% Regis Corporation
17. 5 Inactive Subsidiaries *	Massachusetts	100.00% Regis Corporation
17. Bernett-Anthony Beauty Corporation	New Jersey	100.00% Regis Corporation
18. Concorde School of Hair Design, Inc.	New Jersey	100.00% Regis Corporation
19. European Academy of Cosmetology, Inc.	New Jersey	100.00% Regis Corporation
20. Accredited School of Cosmetology, Inc.	Minnesota	100.00% Regis Corporation
21. Scot-Lewis School – Crystal, Inc.	Minnesota	100.00% Regis Corporation
22. First Par Management Corp.	Rhode Island	100.00% Regis Corporation
A. Arthur Angelo School of Cosmetology and HairDesign, Inc.	Rhode Island	100.00% First Par Management Corp.
23. Hair Club Group, Inc.	Canada Federal	100.00% Regis Corporation
24. HC (USA), Inc.	Delaware	100.00% Regis Corporation
A. HCM USA, Inc.	Delaware	100.00% HC (USA), Inc.
1. HCM Industries, Inc.	Florida	100.00% HCM USA, Inc.
2. HCM Management LLC	Delaware	100.00% HCM USA, Inc.
3. Hair Club for Men, Ltd., Inc.	Florida	100.00% HCM USA, Inc.
a. HCFM, LLC	Delaware	100.00% Hair Club for Men, Ltd., Inc.

Schedule 5.4

Subsidiaries of		% Ownership
Regis Corporation	Jurisdiction	Structure
b. Hair Club for Men, LLC	Delaware	100.00% Hair Club for Men, Ltd., Inc.
c. Hair Club Management Company, LLC	Delaware	100.00% Hair Club for Men, Ltd., Inc.
d. HCA Advertising Services, Inc.	New York	100.00% Hair Club for Men, Ltd., Inc.
e. Hair Club for Men, Ltd	Delaware	100.00% Hair Club for Men, Ltd., Inc.
f. 3115038 Canada, Inc.	Canada Federal	100.00% Hair Club for Men, Ltd., Inc.
g. Hair Club for Men, Ltd	Illinois	50.00% Hair Club for Men, Ltd., Inc.
h. Hair Club for Men of Milwaukee, Ltd	Wisconsin	50.00% Hair Club for Men, Ltd., Inc.
25. Regis Netherlands, Inc.	Minnesota	100.00% Regis Corporation
26. RHS Netherlands CV	Netherlands	1.00% Regis Corporation
		89.00% Regis Netherlands, Inc.
		10.00% Regis International Ltd
A. RHS Netherlands Finance B.V.	Netherlands	100.00% RHS Netherlands CV
B. RHS Netherlands Holdings B.V.	Netherlands	100.00% RHS Netherlands CV
1. Supercuts UK Limited	United Kingdom	100.00% RHS Netherlands Holdings BV
a. 37 Inactive Subsidiaries*	United Kingdom	100.00% Supercuts UK Limited
2. RHS France SAS	France	100.00% RHS Netherlands Holdings BV
a. Jean Louis David France SAS	France	100.00% RHS France SAS
i. Jean Louis David France Salons SARL	France	100.00% Jean Louis David France SAS
b. Saint Algue France SAS	France	100.00% RHS France SAS
i. GIE Regis France SARL	France	100.00% Saint Algue France SAS
ii. Saint Algue France Salons SARL	France	100.00% Saint Algue France SAS
iii. KFI SAS	France	100.00% Saint Algue France SAS
A. 15 Subsidiaries	France	100.00% KFI SAS
B. 1 Subsidiary	France	40.00% KFI SAS
iv. RHS Switzerland	Switzerland	100.00% RHS France SAS
3. RHS UK Holdings Ltd	United Kingdom	100.00% RHS Netherlands Holdings BV
a. Haircare Ltd	United Kingdom	100.00% RHS UK Holdings Ltd
i. Haircare Gmbh	Germany	100.00% Haircare Ltd
ii. York Ave Beauty Salons	Canada	50.00% Haircare Ltd
iii. 2 Inactive Subsidiaries*	United Kingdom	100.00% Haircare Ltd
iv. Salon Management Corporation	California	100.00% Haircare Ltd
A. 1 Inactive Subsidiary*	New York	100.00% Salon Management Corporation
4. Regis International Shared Services SAS	France	100.00% RHS Netherlands Holdings BV
C. Gameo International Ltd	Cayman Islands	100.00% RHS Netherlands CV
1. Cleo International SARL	Luxembourg	100.00% Gameo International Ltd
2. Regis International Franchising SARL	Luxembourg	100.00% Gameo International Ltd
a. Bram Franchising	Brazil	100.00% Regis International Franchising SARL
b. Jean Louis David Poland Spzoo	Poland	100.00% Regis International Franchising SARL
c. Regis Holding Spain SL	Spain	100.00% Regis International Franchising SARL

Schedule 5.4

Subsidiaries of		% Ownership
Regis Corporation	Jurisdiction	Structure
i. Regis Hair Salons SL	Spain	100.00% Regis Holding Spain SL
ii. Jean Louis David Spain SL	Spain	100.00% Regis Holding Spain SL
iii. Production Mission SL	Spain	100.00% Regis Holding Spain SL

*Inactive Entities

Schedule 5.4

SCHEDULE 5.5

FINANCIAL STATEMENTS

As provided in the offering memorandum and enclosures:

2Q FY05 10-Q (period ending 12/31/04)
FY 2004 Annual Report
FY 2003 Annual Report
FY 2002 Annual Report
FY 2001 Annual Report
FY 2000 Annual Report

Schedule 5.5

SCHEDULE 5.14

USE OF PROCEEDS

All of the proceeds of the offering will be used to refinance short term LIBOR and prime rate loans, at an interest rate of LIBOR plus 1.125%, under a revolving credit facility.

Schedule 5.14

SCHEDULE 5.15

EXISTING DEBT

As of December 31, 2004

Prudential Term Notes	$	203,500,000
Bank of America Private Placement		125,000,000
Salt Lake City Mortgage		10,453,668
Total Long Term Debt			$	338,953,668
Revolving Credit Facility				159,280,000
ILC Leases				16,129,727
Other (including acquired)				1,935,715

Schedule 5.15

SCHEDULE 10.5

EXISTING LIENS

Regis Corporation

Regis Corporation and certain Subsidiaries have granted numerous liens in favor of Information Leasing Corporation (a/k/a Information Leasing Corp.) with respect to various salon and warehouse equipment and the Salt Lake Distribution Center. The combined amount outstanding secured by such liens is approximately $28.5 million.

In addition, the following UCC financing statements have been filed with the Minnesota Secretary of State’s office with respect to Regis Corporation:

•   Number 2211705 in favor of Steelcase Financial Services Inc.

•   Number 2298738 in favor of Pitney Bowes Credit Corp.

•   Number 20025242846 in favor of Equilease Financial Services Inc.

•   Number 20036264225 in favor of The Huntington National Bank (as assignee of Information Leasing Corporation)

•   Number 20037146639 in favor of IOS Capital LLC.

•   Number 200410755149 in favor of Weingarten Nostat Inc.

•   Number 200413100402 in favor of Canon Financial Services, Inc.

•   Number 200414190427 in favor of Canon Financial Services, Inc.

•   Number 200514629313 in favor of National City Commercial Capital Corporation.

•   Number 200514714925 in favor of Canon Financial Services, Inc.

•   Number 200514815880 in favor of National City Commercial Capital Corporation.

•   Number 200514994391 in favor of National City Commercial Capital Corporation.

•   Number 200515266638 in favor of National City Commercial Capital Corporation.

•   Number 200515329147 in favor of National City Commercial Capital Corporation.

•   Number 200515509296 in favor of Canon Financial Services, Inc.

The collateral for the Weingarten filing is essentially all assets located at one location, and we believe it secures the obligations under the lease for such premises.

The Huntington filing is as assignee of Information Leasing Corporation.

The National City filings are now part of the Information Leasing Corporation relationship (they are somehow affiliated or may have merged) and are included in the $28.5 million referred to above.

The collateral for all of the other filings are specific equipment provided by such parties, and the aggregate amount owing to all such parties is less than $1 million.

Schedule 10.5

The Barbers, Hairstyling for Men and Women

The following UCC financing statements have been filed with the Minnesota Secretary of State’s office with respect to this entity:

•   Number 20024755905 in favor of Avent Ferry Associates Limited

•   Number 200413993508 in favor of Hippo Partners 04, Ltd.

The collateral for each such filing is essentially all assets located at one location per financing statement, and we believe each secures the obligations of this entity under the lease for such premises.

Supercuts, Inc.

The following UCC financing statements have been filed with the Delaware Secretary of State’s office with respect to this entity:

•   Number 22177664 in favor of Vestar California XXIII, L.L.C.

•   Number 32325234 in favor of Washington Place, LP

•   Number 41569765 in favor of Vestar Arizona XXXI, L.L.C.

•   Number 42955617 in favor of Vestar California XXII, L.L.C.

The collateral for each such filing is essentially all assets located at one location per financing statement, and we believe each secures the obligations of this entity under the lease for such premises.

Trade Secret, Inc.

The following UCC financing statement has been filed with the Colorado Secretary of State’s office with respect to this entity:

•   Number 20042051284 in favor of Vestar California XXIII, L.L.C.

The collateral for this filing is essentially all assets located at one location in Arizona, and we believe it secures the obligations of this entity under the lease for such premises.

Supercuts Corporate Shops, Inc.

The following UCC financing statement has been filed with the Delaware Secretary of State’s office with respect to this entity:

•   Number 23111535 in favor of La Carina Supercuts, Inc.

The collateral for this filing is essentially all assets located at six Supercuts locations, and secures the payment obligation to the franchisee from whom the locations were repurchased. The aggregate amount owning is less than $600,000 and is all due within the next few years.

Schedule 10.5

EXHIBIT 1.1(a)

[FORM OF SERIES 2005-A, TRANCHE 1, NOTE]

REGIS CORPORATION

4.97% SENIOR NOTE, SERIES 2005-A, TRANCHE 1,
DUE MARCH 31, 2013

No. RA1-[___]	[Date]
$[___]	PPN: 758932 F#9

          FOR VALUE RECEIVED, the undersigned, REGIS CORPORATION (herein called the “Company”), a corporation organized and existing under the laws of the State of Minnesota, promises to pay to [   ], or registered assigns, the principal sum of $[   ] on March 31, 2013, with interest (computed on the basis of a 360-day year of twelve 30-day months) (a) on the unpaid balance thereof at the rate of 4.97% per annum from the date hereof, payable semiannually, on March 31 and September 30 in each year, commencing with the March 31 or September 30 next succeeding the date hereof, until the principal hereof shall have become due and payable, and (b) to the extent permitted by law on any overdue payment (including any overdue prepayment) of principal, any overdue payment of interest and any overdue payment of any Make-Whole Amount (as defined in the Note Purchase Agreement referred to below), payable semiannually as aforesaid (or, at the option of the registered holder hereof, on demand), at a rate per annum from time to time equal to the greater of (i) 6.97% or (ii) 2% over the rate of interest publicly announced by Bank of America in Chicago, Illinois as its “base” or “prime” rate.

          Payments of principal of, interest on and any Make-Whole Amount with respect to this Note are to be made in lawful money of the United States of America at the principal office of Bank of America in Chicago, Illinois or at such other place as the Company shall have designated by written notice to the holder of this Note as provided in the Note Purchase Agreement referred to below.

          This Note is one of a series of Senior Notes (herein called the “Notes”) issued pursuant to a Note Purchase Agreement dated as of March 15, 2005 (as from time to time amended, the “Note Purchase Agreement”), between the Company and the respective Purchasers named therein and is entitled to the benefits thereof. Each holder of this Note will be deemed, by its acceptance hereof, (i) to have agreed to the confidentiality provisions set forth in Section 20 of the Note Purchase Agreement and (ii) to have made the representation set forth in Section 6.2 of the Note Purchase Agreement.

          This Note is a registered Note and, as provided in the Note Purchase Agreement, upon surrender of this Note for registration of transfer, duly endorsed, or accompanied by a

Exhibit 1.1(a)

written instrument of transfer duly executed, by the registered holder hereof or such holder’s attorney duly authorized in writing, a new Note for a like principal amount will be issued to, and registered in the name of, the transferee. Prior to due presentment for registration of transfer, the Company may treat the person in whose name this Note is registered as the owner hereof for the purpose of receiving payment and for all other purposes, and the Company will not be affected by any notice to the contrary.

           This Note is subject to optional prepayment, in whole or from time to time in part, at the times and on the terms specified in the Note Purchase Agreement but not otherwise.

          If an Event of Default, as defined in the Note Purchase Agreement, occurs and is continuing, the principal of this Note may be declared or otherwise become due and payable in the manner, at the price (including any applicable Make-Whole Amount) and with the effect provided in the Note Purchase Agreement.

           Payment of the principal of, and interest and Make-Whole Amount, if any, on this Note, and all other amounts due under the Note Purchase Agreement, is guarantied pursuant to the terms of a Guaranty dated as of March 15, 2005 of certain Subsidiaries of the Company.^*

          This Note shall be construed and enforced in accordance with, and the rights of the parties shall be governed by, the law of the State of Illinois excluding choice-of-law principles of the law of such State that would require the application of the laws of a jurisdiction other than such State.

REGIS CORPORATION

By:

Name:

Title:

^* This paragraph must be removed at such time as there are no Subsidiary Guarantors.

2

Exhibit 1.1(a)

EXHIBIT 1.1(b)

[FORM OF SERIES 2005-A, TRANCHE 2, NOTE]

REGIS CORPORATION

5.20% SENIOR NOTE, SERIES 2005-A, TRANCHE 2,
DUE MARCH 31, 2015

No. RA2-[___]	[Date]
$[___]	PPN: 758932 G*2

          FOR VALUE RECEIVED, the undersigned, REGIS CORPORATION (herein called the “Company”), a corporation organized and existing under the laws of the State of Minnesota, promises to pay to [   ], or registered assigns, the principal sum of $[   ] on March 31, 2015, with interest (computed on the basis of a 360-day year of twelve 30-day months) (a) on the unpaid balance thereof at the rate of 5.20% per annum from the date hereof, payable semiannually, on March 31 and September 30 in each year, commencing with the March 31 or September 30 next succeeding the date hereof, until the principal hereof shall have become due and payable, and (b) to the extent permitted by law on any overdue payment (including any overdue prepayment) of principal, any overdue payment of interest and any overdue payment of any Make-Whole Amount (as defined in the Note Purchase Agreement referred to below), payable semiannually as aforesaid (or, at the option of the registered holder hereof, on demand), at a rate per annum from time to time equal to the greater of (i) 7.20% or (ii) 2% over the rate of interest publicly announced by Bank of America in Chicago, Illinois as its “base” or “prime” rate.

          Payments of principal of, interest on and any Make-Whole Amount with respect to this Note are to be made in lawful money of the United States of America at the principal office of Bank of America in Chicago, Illinois or at such other place as the Company shall have designated by written notice to the holder of this Note as provided in the Note Purchase Agreement referred to below.

          This Note is one of a series of Senior Notes (herein called the “Notes”) issued pursuant to a Note Purchase Agreement dated as of March 15, 2005 (as from time to time amended, the “Note Purchase Agreement”), between the Company and the respective Purchasers named therein and is entitled to the benefits thereof. Each holder of this Note will be deemed, by its acceptance hereof, (i) to have agreed to the confidentiality provisions set forth in Section 20 of the Note Purchase Agreement and (ii) to have made the representation set forth in Section 6.2 of the Note Purchase Agreement.

          This Note is a registered Note and, as provided in the Note Purchase Agreement, upon surrender of this Note for registration of transfer, duly endorsed, or accompanied by a

Exhibit 1.1(b)

written instrument of transfer duly executed, by the registered holder hereof or such holder’s attorney duly authorized in writing, a new Note for a like principal amount will be issued to, and registered in the name of, the transferee. Prior to due presentment for registration of transfer, the Company may treat the person in whose name this Note is registered as the owner hereof for the purpose of receiving payment and for all other purposes, and the Company will not be affected by any notice to the contrary.

          This Note is subject to optional prepayment, in whole or from time to time in part, at the times and on the terms specified in the Note Purchase Agreement but not otherwise.

          If an Event of Default, as defined in the Note Purchase Agreement, occurs and is continuing, the principal of this Note may be declared or otherwise become due and payable in the manner, at the price (including any applicable Make-Whole Amount) and with the effect provided in the Note Purchase Agreement.

          Payment of the principal of, and interest and Make-Whole Amount, if any, on this Note, and all other amounts due under the Note Purchase Agreement, is guarantied pursuant to the terms of a Guaranty dated as of March 15, 2005 of certain Subsidiaries of the Company.^*

          This Note shall be construed and enforced in accordance with, and the rights of the parties shall be governed by, the law of the State of Illinois excluding choice-of-law principles of the law of such State that would require the application of the laws of a jurisdiction other than such State.

REGIS CORPORATION

By:

Name:

Title:

^* This paragraph must be removed at such time as there are no Subsidiary Guarantors.

2

Exhibit 1.1(b)

EXHIBIT 1.1(c)

[FORM OF SERIES 2005-B, TRANCHE 1, NOTE]

REGIS CORPORATION

FLOATING RATE SENIOR NOTE, SERIES 2005-B, TRANCHE 1,
DUE MARCH 31, 2013

No. RB1-[___]	[Date]
$[___]	PPN: 758932 G@ 0

          FOR VALUE RECEIVED, the undersigned, REGIS CORPORATION (herein called the “Company”), a corporation organized and existing under the laws of the State of Minnesota, promises to pay to [    ], or registered assigns, the principal sum of $[   ] on March 31, 2013, with interest (computed on the basis of a 360-day year and the actual number of days elapsed) (a) on the unpaid principal thereof at a floating rate equal to the Adjusted LIBOR Rate from time to time, payable quarterly on each March 31, June 30, September 30 and December 31, commencing with the March 31, June 30, September 30 or December 31 next succeeding the date hereof, until the principal shall have become due and payable, and (b) to the extent permitted by law on any overdue payment (including any overdue prepayment) of principal, any overdue payment of interest, any overdue payment of prepayment premium and any LIBOR Breakage Amount at the Default Rate (as defined in the Note Purchase Agreement referred to below) until paid.

          Payments of principal of, interest on and any prepayment premium or LIBOR Breakage Amount with respect to this Note are to be made in lawful money of the United States of America at the principal office of Bank of America in Chicago, Illinois or at such other place as the Company shall have designated by written notice to the holder of this Note as provided in the Note Purchase Agreement referred to below.

          This Note is one of a series of Senior Notes (herein called the “Notes”) issued pursuant to a Note Purchase Agreement dated as of March 15, 2005 (as from time to time amended, the “Note Purchase Agreement”), between the Company and the respective Purchasers named therein and is entitled to the benefits thereof. Reference is made to the Note Purchase Agreement for the definitions used herein and the method of calculating the interest and other payments to be made on or in respect of this Note. Each holder of this Note will be deemed, by its acceptance hereof, (i) to have agreed to the confidentiality provisions set forth in Section 20 of the Note Purchase Agreement and (ii) to have made the representation set forth in Section 6.2 of the Note Purchase Agreement.

          This Note is a registered Note and, as provided in the Note Purchase Agreement, upon surrender of this Note for registration of transfer, duly endorsed, or accompanied by a

Exhibit 1.1(c)

written instrument of transfer duly executed, by the registered holder hereof or such holder’s attorney duly authorized in writing, a new Note for a like principal amount will be issued to, and registered in the name of, the transferee. Prior to due presentment for registration of transfer, the Company may treat the person in whose name this Note is registered as the owner hereof for the purpose of receiving payment and for all other purposes, and the Company will not be affected by any notice to the contrary.

          This Note is subject to optional prepayment, in whole or from time to time in part, at the times and on the terms specified in the Note Purchase Agreement but not otherwise.

          If an Event of Default, as defined in the Note Purchase Agreement, occurs and is continuing, the principal of this Note may be declared or otherwise become due and payable in the manner, at the price (including any applicable prepayment premium and LIBOR Breakage Amount) and with the effect provided in the Note Purchase Agreement.

          Payment of the principal of, and interest and prepayment premium, if any, and LIBOR Breakage Amount, if any, on this Note, and all other amounts due under the Note Purchase Agreement, is guarantied pursuant to the terms of a Guaranty dated as of March 15, 2005 of certain Subsidiaries of the Company.^*

          This Note shall be construed and enforced in accordance with, and the rights of the parties shall be governed by, the law of the State of Illinois excluding choice-of-law principles of the law of such State that would require the application of the laws of a jurisdiction other than such State.

REGIS CORPORATION

By:

Name:

Title:

^* This paragraph must be removed at such time as there are no Subsidiary Guarantors.

2

Exhibit 1.1(c)

EXHIBIT 1.1(d)

[FORM OF SERIES 2005-B, TRANCHE 2, NOTE]

REGIS CORPORATION

FLOATING RATE SENIOR NOTE, SERIES 2005-B, TRANCHE 2,
DUE MARCH 31, 2015

No. RB2-[___]	[Date]
$[___]	PPN: 758932 G# 8

          FOR VALUE RECEIVED, the undersigned, REGIS CORPORATION (herein called the “Company”), a corporation organized and existing under the laws of the State of Minnesota, promises to pay to [    ], or registered assigns, the principal sum of $[   ] on March 31, 2015, with interest (computed on the basis of a 360-day year and the actual number of days elapsed) (a) on the unpaid principal thereof at a floating rate equal to the Adjusted LIBOR Rate from time to time, payable quarterly on each March 31, June 30, September 30 and December 31, commencing with the March 31, June 30, September 30 or December 31 next succeeding the date hereof, until the principal shall have become due and payable, and (b) to the extent permitted by law on any overdue payment (including any overdue prepayment) of principal, any overdue payment of interest, any overdue payment of prepayment premium and any LIBOR Breakage Amount at the Default Rate until paid.

          Payments of principal of, interest on and any prepayment premium or LIBOR Breakage Amount with respect to this Note are to be made in lawful money of the United States of America at the principal office of Bank of America in Chicago, Illinois or at such other place as the Company shall have designated by written notice to the holder of this Note as provided in the Note Purchase Agreement referred to below.

          This Note is one of a series of Senior Notes (herein called the “Notes”) issued pursuant to a Note Purchase Agreement dated as of March 15, 2005 (as from time to time amended, the “Note Purchase Agreement”), between the Company and the respective Purchasers named therein and is entitled to the benefits thereof. Reference is made to the Note Purchase Agreement for the definitions used herein and the method of calculating the interest and other payments to be made on or in respect of this Note. Each holder of this Note will be deemed, by its acceptance hereof, (i) to have agreed to the confidentiality provisions set forth in Section 20 of the Note Purchase Agreement and (ii) to have made the representation set forth in Section 6.2 of the Note Purchase Agreement.

          This Note is a registered Note and, as provided in the Note Purchase Agreement, upon surrender of this Note for registration of transfer, duly endorsed, or accompanied by a written instrument of transfer duly executed, by the registered holder hereof or such holder’s

Exhibit 1.1(d)

attorney duly authorized in writing, a new Note for a like principal amount will be issued to, and registered in the name of, the transferee. Prior to due presentment for registration of transfer, the Company may treat the person in whose name this Note is registered as the owner hereof for the purpose of receiving payment and for all other purposes, and the Company will not be affected by any notice to the contrary.

          This Note is subject to optional prepayment, in whole or from time to time in part, at the times and on the terms specified in the Note Purchase Agreement but not otherwise.

          If an Event of Default, as defined in the Note Purchase Agreement, occurs and is continuing, the principal of this Note may be declared or otherwise become due and payable in the manner, at the price (including any applicable prepayment premium and LIBOR Breakage Amount) and with the effect provided in the Note Purchase Agreement.

          Payment of the principal of, and interest and prepayment premium, if any, and LIBOR Breakage Amount, if any, on this Note, and all other amounts due under the Note Purchase Agreement, is guarantied pursuant to the terms of a Guaranty dated as of March 15, 2005 of certain Subsidiaries of the Company.^*

          This Note shall be construed and enforced in accordance with, and the rights of the parties shall be governed by, the law of the State of Illinois excluding choice-of-law principles of the law of such State that would require the application of the laws of a jurisdiction other than such State.

REGIS CORPORATION

By:

Name:

Title:

^* This paragraph must be removed at such time as there are no Subsidiary Guarantors.

2

Exhibit 1.1(d)

EXHIBIT 1.2

REGIS CORPORATION

[          ] SUPPLEMENT TO NOTE PURCHASE AGREEMENT

Dated as of                                         

Re: $                                                             % Senior Notes, Series                     
due                     

Exhibit 1.2

REGIS CORPORATION
7201 Metro Boulevard
Edina, MN 55439
(952) 947-7777
Fax: (952) 947-7700

[      ] SUPPLEMENT TO MASTER NOTE PURCHASE
AGREEMENT DATED AS OF MARCH 15, 2005

Dated as of [      ]

TO EACH OF THE PURCHASERS LISTED IN

     THE ATTACHED SCHEDULE A:

Ladies and Gentlemen:

     This [Number] Supplement to Note Purchase Agreement (the “Supplement”) is between REGIS CORPORATION, a Minnesota corporation (the “Company”), and the institutional investor[s] named on the attached Schedule A (the “Purchaser[s]”).

     Reference is hereby made to the Note Purchase Agreement dated as of March 15, 2005 (the “Note Purchase Agreement”) between the Company and the purchasers listed on Schedule A thereto. Capitalized terms not otherwise defined herein shall have the meanings ascribed in the Note Purchase Agreement. Reference is further made to Section 1.2 of the Note Purchase Agreement, which provides that each series of Additional Notes will be issued pursuant to a Supplement.

     The Company agrees with the Purchaser[s] as follows:

     1. Authorization of the New Series of Additional Notes. The Company has authorized the issue and sale of $[    ] aggregate principal amount of Notes to be designated as its [    %] [Floating Rate] Senior Notes, Series [    ], due [    ], [    ] (the “Series [    ] Notes”). The Series [    ] Notes, together with the Series 2005 Notes [and the Series [    ] Notes] heretofore issued pursuant to the Note Purchase Agreement and each series of Additional Notes that may from time to time hereafter be issued pursuant to the provisions of Section 1.2 of the Note Purchase Agreement, are collectively referred to as the “Notes” (such term shall also include any such notes issued in substitution therefor pursuant to Section 13 of the Note Purchase Agreement). The Series [    ] Notes shall be substantially in the form set out in Exhibit 1 to this [    ] Supplement, with such changes therefrom, if any, as may be approved by the Purchaser[s] and the Company.

     2. Sale and Purchase of Series [    ] Notes. Subject to the terms and conditions herein and in the Note Purchase Agreement, the Company will issue and sell each Purchaser and

Exhibit 1.2

each Purchaser will purchase from the Company, at the Closing provided for in Section 3, Series [    ] Notes in the principal amount specified opposite such Purchaser’s name in the attached Schedule A at the purchase price of 100% of the principal amount thereof. The obligations of the Purchasers are several and not joint obligations and each Purchaser shall have no liability to any Person for the performance or non-performance by any other Purchaser hereunder.

     3. Closing. The sale and purchase of the Series [    ] Notes to be purchased by the Purchasers shall occur at the offices of [    ] at 9:00 a.m., [    ] time, at a closing (the “Closing”) on [    ], [    ] or on such other Business Day thereafter on or prior to [    ], [    ] as may be agreed upon by the Company and you and the other Purchasers. At the Closing the Company will deliver to you the Series [    ] Notes to be purchased by you in the form of a single Note (or such greater number of Series [    ] Notes in denominations of at least $100,000 as you may request) dated the date of the Closing and registered in your name (or in the name of your nominee), against delivery by you to the Company or its order of immediately available funds in the amount of the purchase price therefor by wire transfer of immediately available funds for the account of the Company to account number [    ] at [ Name and Address of Bank], ABA No. [    ]. If at the Closing the Company fails to tender such Series [    ] Notes to any Purchaser as provided above in this Section 3, or any of the conditions specified in Section 4 shall not have been fulfilled to such Purchaser’s satisfaction, such Purchaser shall, at such Purchaser’s election, be relieved of all further obligations under this Agreement, without thereby waiving any rights such Purchaser may have by reason of such failure or such nonfulfillment.

     4. Conditions to Closing. Each Purchaser’s obligation to purchase and pay for the Series [    ] Notes to be sold to such Purchaser at the Closing is subject to the fulfillment to such Purchaser’s satisfaction, prior to or at the Closing, of the conditions set forth in Section 4 of the Note Purchase Agreement and to the following additional conditions:

     (a) Except as supplemented, amended or superceded by the representations and warranties set forth in Schedule 4, each of the representations and warranties of the Company set forth in Section 5 of the Note Purchase Agreement shall be correct as of the date of Closing and the Company shall have delivered to each Purchaser an Officer’s Certificate, dated the date of the Closing certifying that such condition has been fulfilled.

     (b) Contemporaneously with the Closing, the Company shall sell to each Purchaser, and each Purchaser shall purchase, the Series ___ Notes to be purchased by such Purchaser at the Closing as specified in Schedule A.

[Here insert any modifcations to conditions or additional conditions to Closing]

     5. [Here insert special provisions for Series ___ Notes including prepayment provisions applicable to Series ___ Notes (including make-whole amount, premium and breakage amount, if any)].

 2

Exhibit 1.2

     6. Representations of the Purchasers. Each Purchaser represents and warrants that the representations and warranties set forth in Section 6 of the Note Purchase Agreement are true and correct on the date hereof with respect to the purchase of the Series ___ Notes by such Purchaser.

     7. Applicability of Note Purchase Agreement. The Company and each Purchaser agree to be bound by and comply with the terms and provisions of the Note Purchase Agreement as fully and completely as if such Purchaser were an original signatory to the Note Purchase Agreement.

     8. Additional Provisions. [Here insert any additional provisions].

     If you are in agreement with the foregoing, please sign the form of agreement on the accompanying counterpart of this Agreement and return it to the Company, whereupon the foregoing shall become a binding agreement between you and the Company. This Agreement may be executed in any number of counterparts, each executed counterpart constituting an original but all together only one agreement.

Very truly yours,

REGIS CORPORATION

By:

Name:

Title:

 3

Exhibit 1.2

The foregoing is agreed
to as of the date thereof.

[ADD PURCHASER SIGNATURE BLOCKS]

 4

Exhibit 1.2

CONFIRMATION

     Each of the undersigned acknowledges receipt of the foregoing [  ] Supplement to Note Purchase Agreement dated as of March 15, 2005 and confirms the continuing validity and enforceability against such undersigned of the Security Agreement to which such undersigned is a party.

[ADD SIGNATURE BLOCKS FOR EACH
SUBSIDIARY GUARANTOR]

 5

Exhibit 1.2

Schedule A to
[  ] Supplement

INFORMATION RELATING TO PURCHASERS

	Principal Amount of
Name and Address of Purchaser	Series [  ]  Notes to be Purchased

Register Notes in name of:

(1)	All scheduled payments of principal and interest by wire transfer of immediately available funds to:
	with sufficient information to identify the source and application of such funds, including issuer, PPN#, interest rate, maturity and whether payment is of principal, premium, or interest
	For all payments other than scheduled payments of principal and interest, the Company shall seek instructions from the holder, and in the absence of instructions to the contrary, will make such payments to the account and in the manner set forth above.
(2)	All notices of payments and written confirmations of such wire transfers:
(3)	Original notes delivered to:
4)	All other communications:

Tax ID No.

 6

Exhibit 1.2

Schedule 4 to
[   ] Supplement

SUPPLEMENTAL REPRESENTATIONS

     The Company represents and warrants to each Purchaser that, except as hereinafter set forth in this Schedule 4, each of the representations and warranties set forth in Section 5 of the Note Purchase Agreement is true and correct in all material respects as of the date hereof with respect to the Series ___ Notes with the same force and effect as if each reference to “Series A Notes” set forth therein was modified to refer to the “Series ___ Notes” and each reference to “this Agreement” therein was modified to refer to the Note Purchase Agreement as supplemented by the ___Supplement. The Section references hereinafter set forth correspond to the similar sections of the Note Purchase Agreement that are supplemented hereby:

     Section 5.3. Disclosure. The Company, through its agent, Banc of America Securities LLC has delivered to each Purchaser a copy of a Private Placement Memorandum, dated ___ (the “Memorandum”), relating to the transactions contemplated by the ___  Supplement. The Memorandum fairly describes, in all material respects, the general nature of the business and principal properties of the Company and its Restricted Subsidiaries. The Note Purchase Agreement, the Memorandum, the documents, certificates or other writings delivered to each Purchaser by or on behalf of the Company in connection with the transactions contemplated by the Note Purchase Agreement and the ___ Supplement and the financial statements listed in Schedule 5.5 to the ___ Supplement (the Note Purchase Agreement, the ___ Supplement, the Memorandum and such documents, certificates or other writings and such financial statements being referred to, collectively, as the “Disclosure Documents”), taken as a whole, do not contain any untrue statement of a material fact or omit to state any material fact necessary to make the statements therein not misleading in light of the circumstances under which they were made. Except as disclosed in the Disclosure Documents, since ___, there has been no change in the financial condition, operations, business, properties or prospects of the Company or any Restricted Subsidiary, except changes that individually or in the aggregate could not reasonably be expected to have a Material Adverse Effect. There is no fact known to the Company that could reasonably be expected to have a Material Adverse Effect that has not been set forth herein or in the Disclosure Documents.

     Section 5.4. Organization and Ownership of Shares of Subsidiaries. (a) Schedule 5.4 to the ___ Supplement contains (except as noted therein) complete and correct lists of (i) the Company’s Restricted and Unrestricted Subsidiaries, and showing, as to each Subsidiary, the correct name thereof, the jurisdiction of its organization, and the percentage of shares of each class of its capital stock or similar equity interests outstanding owned by the Company and each other Subsidiary, (ii) the Company’s Affiliates, other than Subsidiaries, and (iii) the Company’s directors and senior officers.

 7

Exhibit 1.2

     Section 5.13. Private Offering by the Company. Neither the Company nor anyone acting on its behalf has offered the Series ___ Notes or any similar securities for sale to, or solicited any offer to buy any of the same from, or otherwise approached or negotiated in respect thereof with, any Person other than the Purchasers and not more than [  ] other Institutional Investors, each of which has been offered the Series ___ Notes at a private sale for investment. Neither the Company nor anyone acting on its behalf has taken, or will take, any action that would subject the issuance or sale of the Notes to the registration requirements of Section 5 of the Securities Act or to the registration requirements of any securities or blue sky laws of any applicable jurisdiction.

     Section 5.14. Use of Proceeds; Margin Regulations. The Company will apply the proceeds of the sale of the Series ___ Notes to ___ and for general corporate purposes. No part of the proceeds from the sale of the Series ___ Notes pursuant to the ___ Supplement will be used, directly or indirectly, for the purpose of buying or carrying any margin stock within the meaning of Regulation U of the Board of Governors of the Federal Reserve System (12 CFR 221), or for the purpose of buying or carrying or trading in any securities under such circumstances as to involve the Company in a violation of Regulation X of said Board (12 CFR 224) or to involve any broker or dealer in a violation of Regulation T of said Board (12 CFR 220). Margin stock does not constitute more than 1% of the value of the consolidated assets of the Company and its Subsidiaries and the Company does not have any present intention that margin stock will constitute more than 1% of the value of such assets. As used in this Section, the terms “margin stock” and “purpose of buying or carrying” shall have the meanings assigned to them in said Regulation U.

     Section 5.15. Existing Debt; Future Liens. (a) Schedule 5.15 to the ___ Supplement sets forth a complete and correct list of all outstanding Debt of the Company and its Restricted Subsidiaries as of ___, since which date there has been no Material change in the amounts, interest rates, sinking funds, installment payments or maturities of the Debt of the Company or its Restricted Subsidiaries. Neither the Company nor any Restricted Subsidiary is in default and no waiver of default is currently in effect, in the payment of any principal or interest on any Debt of the Company or such Subsidiary and no event or condition exists with respect to any Debt of the Company or any Restricted Subsidiary that would permit (or that with notice or the lapse of time, or both, would permit) one or more Persons to cause such Debt to become due and payable before its stated maturity or before its regularly scheduled dates of payment.

     [Add any additional Sections as appropriate at the time the Series ___ Notes are issued and any exceptions to the representations and warranties]

 8

Exhibit 1.2

Exhibit 1 to
Supplement

FORM OF SERIES [  ] NOTE

 9

Exhibit 1.2

EXHIBIT 1.3

[FORM OF SUBSIDIARY GUARANTY]

     THIS GUARANTY (this “Guaranty”) dated as of March 15, 2005 is made by the undersigned (each, a “Guarantor”), in favor of the holders from time to time of the Notes hereinafter referred to, including each purchaser named in the Note Purchase Agreement hereinafter referred to, and their respective successors and assigns (collectively, the “Holders” and each individually, a “Holder”).

W I T N E S S E T H:

     WHEREAS, REGIS CORPORATION, a Minnesota corporation (the “Company”), and the initial Holders have entered into a Master Note Purchase Agreement dated as of March 15, 2005 (the Master Note Purchase Agreement as amended, supplemented, restated or otherwise modified from time to time in accordance with its terms and in effect, the “Note Purchase Agreement”);

     WHEREAS, the Note Purchase Agreement contemplates the issuance by the Company of Notes (as defined in the Note Purchase Agreement) in one or more series and tranches, up to $400,000,000 aggregate principal amount;

     WHEREAS, the Company directly or indirectly owns all or a substantial portion of the issued and outstanding capital stock of each Guarantor and, by virtue of such ownership and otherwise, each Guarantor will derive substantial benefits from the purchase by the Holders of the Company’s Notes;

     WHEREAS, it is a condition precedent to the obligation of the Holders to purchase the Notes that each Guarantor shall have executed and delivered this Guaranty to the Holders; and

     WHEREAS, each Guarantor desires to execute and deliver this Guaranty to satisfy the conditions described in the preceding paragraph;

     NOW, THEREFORE, in consideration of the premises and other benefits to each Guarantor, and of the purchase of the Company’s Notes by the Holders, and for other good and valuable consideration, the receipt and sufficiency of which are acknowledged, each Guarantor makes this Guaranty as follows:

     SECTION 1. Definitions. Any capitalized terms not otherwise herein defined shall have the meanings attributed to them in the Note Purchase Agreement.

     SECTION 2. Guaranty. Each Guarantor, jointly and severally with each other Guarantor, unconditionally and irrevocably guarantees to the Holders the due, prompt and complete payment by the Company of the principal of, make-whole amount, if any, prepayment premium, if any, breakage amount, if any, and interest on, and each other amount due under, the Notes or the Note Purchase Agreement, when and as the same shall become due and payable

Exhibit 1.3

(whether at stated maturity or by required or optional prepayment or by acceleration or otherwise) in accordance with the terms of the Notes and the Note Purchase Agreement (the Notes and the Note Purchase Agreement being sometimes hereinafter collectively referred to as the “Note Documents” and the amounts payable by the Company under the Note Documents, and all other monetary obligations of the Company thereunder (including any attorneys’ fees and expenses), being sometimes collectively hereinafter referred to as the “Obligations”). This Guaranty is a guaranty of payment and not just of collectibility and is in no way conditioned or contingent upon any attempt to collect from the Company or upon any other event, contingency or circumstance whatsoever. If for any reason whatsoever the Company shall fail or be unable duly, punctually and fully to pay such amounts as and when the same shall become due and payable, each Guarantor, without demand, presentment, protest or notice of any kind, will forthwith pay or cause to be paid such amounts to the Holders under the terms of such Note Documents, in lawful money of the United States, at the place specified in the Note Purchase Agreement, or perform or comply with the same or cause the same to be performed or complied with, together with interest (to the extent provided for under such Note Documents) on any amount due and owing from the Company. Each Guarantor, promptly after demand, will pay to the Holders the reasonable costs and expenses of collecting such amounts or otherwise enforcing this Guaranty, including, without limitation, the reasonable fees and expenses of counsel. Notwithstanding the foregoing, the right of recovery against each Guarantor under this Guaranty is limited to the extent it is judicially determined with respect to any Guarantor that entering into this Guaranty would violate Section 548 of the United States Bankruptcy Code or any comparable provisions of any state law, in which case such Guarantor shall be liable under this Guaranty only for amounts aggregating up to the largest amount that would not render such Guarantor’s obligations hereunder subject to avoidance under Section 548 of the United States Bankruptcy Code or any comparable provisions of any state law.

     SECTION 3. Guarantor’s Obligations Unconditional. The obligations of each Guarantor under this Guaranty shall be primary, absolute and unconditional obligations of each Guarantor, shall not be subject to any counterclaim, set-off, deduction, diminution, abatement, recoupment, suspension, deferment, reduction or defense based upon any claim each Guarantor or any other person may have against the Company or any other person, and to the full extent permitted by applicable law shall remain in full force and effect without regard to, and shall not be released, discharged or in any way affected by, any circumstance or condition whatsoever (whether or not each Guarantor or the Company shall have any knowledge or notice thereof), including:

     (a) any termination, amendment or modification of or deletion from or addition or supplement to or other change in any of the Note Documents or any other instrument or agreement applicable to any of the parties to any of the Note Documents;

     (b) any furnishing or acceptance of any security, or any release of any security, for the Obligations, or the failure of any security or the failure of any person to perfect any interest in any collateral;

     (c) any failure, omission or delay on the part of the Company to conform or comply with any term of any of the Note Documents or any other instrument or

 2

Exhibit 1.3

agreement referred to in paragraph (a) above, including, without limitation, failure to give notice to any Guarantor of the occurrence of a “Default” or an “Event of Default” under any Note Document;

     (d) any waiver of the payment, performance or observance of any of the obligations, conditions, covenants or agreements contained in any Note Document, or any other waiver, consent, extension, indulgence, compromise, settlement, release or other action or inaction under or in respect of any of the Note Documents or any other instrument or agreement referred to in paragraph (a) above or any obligation or liability of the Company, or any exercise or non-exercise of any right, remedy, power or privilege under or in respect of any such instrument or agreement or any such obligation or liability;

     (e) any failure, omission or delay on the part of any of the Holders to enforce, assert or exercise any right, power or remedy conferred on such Holder in this Guaranty, or any such failure, omission or delay on the part of such Holder in connection with any Note Document, or any other action on the part of such Holder;

     (f) any voluntary or involuntary bankruptcy, insolvency, reorganization, arrangement, readjustment, assignment for the benefit of creditors, composition, receivership, conservatorship, custodianship, liquidation, marshaling of assets and liabilities or similar proceedings with respect to the Company, any Guarantor or to any other person or any of their respective properties or creditors, or any action taken by any trustee or receiver or by any court in any such proceeding;

     (g) any discharge, termination, cancellation, frustration, irregularity, invalidity or unenforceability, in whole or in part, of any of the Note Documents or any other agreement or instrument referred to in paragraph (a) above or any term hereof;

     (h) any merger or consolidation of the Company or any Guarantor into or with any other corporation, or any sale, lease or transfer of any of the assets of the Company or any Guarantor to any other person;

     (i) any change in the ownership of any shares of capital stock of the Company or any change in the corporate relationship between the Company and any Guarantor, or any termination of such relationship;

     (j) any release or discharge, by operation of law, of any Guarantor from the performance or observance of any obligation, covenant or agreement contained in this Guaranty; or

     (k) any other occurrence, circumstance, happening or event whatsoever, whether similar or dissimilar to the foregoing, whether foreseen or unforeseen, and any other circumstance which might otherwise constitute a legal or equitable defense or

 3

Exhibit 1.3

discharge of the liabilities of a guarantor or surety or which might otherwise limit recourse against any Guarantor.

     SECTION 4. Full Recourse Obligations. The obligations of each Guarantor set forth herein constitute the full recourse obligations of such Guarantor enforceable against it to the full extent of all its assets and properties.

     SECTION 5. Waiver. Each Guarantor unconditionally waives, to the extent permitted by applicable law, (a) notice of any of the matters referred to in Section 3, (b) notice to such Guarantor of the incurrence of any of the Obligations, notice to such Guarantor or the Company of any breach or default by such Guarantor or the Company with respect to any of the Obligations or any other notice that may be required, by statute, rule of law or otherwise, to preserve any rights of the Holders against such Guarantor, (c) presentment to or demand of payment from the Company or the Guarantor with respect to any amount due under any Note Document or protest for nonpayment or dishonor, (d) any right to the enforcement, assertion or exercise by any of the Holders of any right, power, privilege or remedy conferred in the Note Purchase Agreement or any other Note Document or otherwise, (e) any requirement of diligence on the part of any of the Holders, (f) any requirement to exhaust any remedies or to mitigate the damages resulting from any default under any Note Document, (g) any notice of any sale, transfer or other disposition by any of the Holders of any right, title to or interest in the Note Purchase Agreement or in any other Note Document and (h) any other circumstance whatsoever which might otherwise constitute a legal or equitable discharge, release (other than a release of such Guarantor herefrom pursuant to Section 1.3(b) of the Note Purchase Agreement) or defense of a guarantor or surety (other than the defense of payment) or which might otherwise limit recourse against such Guarantor.

     SECTION 6. Subrogation, Contribution, Reimbursement or Indemnity. Until all Obligations have been indefeasibly paid in full, each Guarantor agrees not to take any action pursuant to any rights which may have arisen in connection with this Guaranty to be subrogated to any of the rights (whether contractual, under the United States Bankruptcy Code, as amended, including Section 509 thereof, under common law or otherwise) of any of the Holders against the Company or against any collateral security or guaranty or right of offset held by the Holders for the payment of the Obligations. Until all Obligations have been indefeasibly paid in full, each Guarantor agrees not to take any action pursuant to any contractual, common law, statutory or other rights of reimbursement, contribution, exoneration or indemnity (or any similar right) from or against the Company which may have arisen in connection with this Guaranty. So long as any Obligations remain outstanding, if any amount shall be paid by or on behalf of the Company to any Guarantor on account of any of the rights waived in this Section 6, such amount shall be held by such Guarantor in trust, segregated from other funds of such Guarantor, and shall, forthwith upon receipt by such Guarantor, be turned over to the Holders (duly endorsed by such Guarantor to the Holders, if required), to be applied against the Obligations, whether matured or unmatured, in such order as the Holders may determine. The provisions of this Section 6 shall survive the term of this Guaranty and the payment in full of the Obligations.

 4

Exhibit 1.3

     SECTION 7. Effect of Bankruptcy Proceedings, etc. This Guaranty shall continue to be effective or be automatically reinstated, as the case may be, if at any time payment, in whole or in part, of any of the sums due to any of the Holders pursuant to the terms of the Note Purchase Agreement or any other Note Document is rescinded or must otherwise be restored or returned by such Holder upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of the Company or any other person, or upon or as a result of the appointment of a custodian, receiver, trustee or other officer with similar powers with respect to the Company or other person or any substantial part of its property, or otherwise, all as though such payment had not been made. If an event permitting the acceleration of the maturity of the principal amount of the Notes shall at any time have occurred and be continuing, and such acceleration shall at such time be prevented by reason of the pendency against the Company or any other person of a case or proceeding under a bankruptcy or insolvency law, each Guarantor agrees that, for purposes of this Guaranty and its obligations hereunder, the maturity of the principal amount of the Notes and all other Obligations shall be deemed to have been accelerated with the same effect as if any Holder had accelerated the same in accordance with the terms of the Note Purchase Agreement or other applicable Note Document, and such Guarantor shall forthwith pay such principal amount, Make-Whole Amount, if any, and interest thereon and any other amounts guaranteed hereunder without further notice or demand.

     SECTION 8. Term of Agreement. This Guaranty and all guaranties, covenants and agreements of each Guarantor contained herein shall continue in full force and effect and shall not be discharged until such time as all of the Obligations shall be paid and performed in full and all of the agreements of such Guarantor hereunder shall be duly paid and performed in full; provided that each Guarantor shall be automatically and immediately released herefrom without any further act by any Person as provided in Section 1.3(b) of the Note Purchase Agreement.

     SECTION 9. Representations and Warranties. Each Guarantor represents and warrants to each Holder that:

     (a) such Guarantor is duly organized, validly existing and in good standing under the laws of its jurisdiction of organization and has the requisite power and authority 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;

     (b) such Guarantor has the requisite power and authority and the legal right to execute and deliver, and to perform its obligations under, this Guaranty, and has taken all necessary action to authorize its execution, delivery and performance of this Guaranty;

     (c) this Guaranty constitutes a legal, valid and binding obligation of such Guarantor enforceable in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights generally and by general equitable principles (regardless of whether such enforceability is considered in a proceeding in equity or at law);

 5

Exhibit 1.3

     (d) the execution, delivery and performance of this Guaranty will not (i) contravene, result in any breach of, or constitute a default under, or result in the creation of any Lien in respect of any property of such Guarantor under any indenture, mortgage, deed of trust, loan, credit agreement, corporate charter or by-laws, or any other agreement evidencing Debt, (ii) contravene, result in any breach of, or constitute a default under, or result in the creation of any Lien in respect of any property of such Guarantor under, any other agreement or instrument to which such Guarantor is bound or by which such Guarantor or any of its properties may be bound or affected, except as could not reasonably be expected to have a Material Adverse Effect, (iii) conflict with or result in a breach of any of the terms, conditions or provisions of any order, judgment, decree, or ruling of any court, arbitrator or Governmental Authority applicable to such Guarantor, except as could not reasonably be expected to have a Material Adverse Effect, or (iv) violate any provision of any statute or other rule or regulation of any Governmental Authority applicable to such Guarantor, except as could not reasonably be expected to have a Material Adverse Effect;

     (e) no consent, approval or authorization of, or registration, filing or declaration with, any Governmental Authority is required in connection with the execution, delivery or performance by such Guarantor of this Guaranty;

     (f) except as disclosed in Section 5.8 of the Note Purchase Agreement, no litigation, investigation or proceeding of or before any arbitrator or governmental authority is pending or, to the knowledge of such Guarantor, threatened by or against such Guarantor or any of its properties or revenues (i) with respect to this Guaranty or any of the transactions contemplated hereby or (ii) which could reasonably be expected to have a material adverse effect upon the business, operations or financial condition of such Guarantor and its Subsidiaries taken as a whole;

     (g) such Guarantor (after giving due consideration to any rights of contribution) has received fair consideration and reasonably equivalent value for the incurrence of its obligations hereunder or as contemplated hereby and after giving effect to the transactions contemplated herein, (i) the fair value of the assets of such Guarantor (both at fair valuation and at present fair saleable value) exceeds its liabilities, (ii) such Guarantor is able to and expects to be able to pay its debts as they mature, and (iii) such Guarantor has capital sufficient to carry on its business as conducted and as proposed to be conducted.

     SECTION 10. Notices. All notices and communications provided for hereunder shall be in writing and sent (a) by facsimile if the sender on the same day sends a confirming copy of such notice by a recognized overnight delivery service (charges prepaid), (b) by registered or certified mail with return receipt requested (postage prepaid), or (c) by a recognized overnight delivery service (with charges prepaid), addressed (a) if to the Company or any Holder at the address or telecopy number set forth in the Note Purchase Agreement or (b) if to a Guarantor, in care of the Company at the Company’s address or telecopy number set forth in the Note Purchase Agreement, or in each case at such other address or telecopy number as the Company,

 6

Exhibit 1.3

any Holder or such Guarantor shall from time to time designate in writing to the other parties. Any notice so addressed shall be deemed to be given when actually received.

     SECTION 11. Survival. All warranties, representations and covenants made by each Guarantor herein or in any certificate or other instrument delivered by it or on its behalf hereunder shall be considered to have been relied upon by the Holders and shall survive the execution and delivery of this Guaranty, regardless of any investigation made by any of the Holders. All statements in any such certificate or other instrument shall constitute warranties and representations by such Guarantor hereunder.

     SECTION 12. Jurisdiction and Process; Waiver of Jury Trial.

     (a) Each Guarantor irrevocably submits to the non exclusive jurisdiction of any Illinois State or federal court sitting in Illinois over any suit, action or proceeding arising out of or relating solely to this Agreement or the Notes. To the fullest extent permitted by applicable law, Each Guarantor irrevocably waives and agrees not to assert, by way of motion, as a defense or otherwise, any claim that it is not subject to the jurisdiction of any such court, any objection that it may now or hereafter have to the laying of the venue of any such suit, action or proceeding brought in any such court and any claim that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum.

     (b) The Company consents to process being served in any suit, action or proceeding solely of the nature referred to in Section 12(a) by mailing a copy thereof by registered or certified or priority mail, postage prepaid, return receipt requested, or delivering a copy thereof in the manner for delivery of notices specified in Section 10, to it. Each Guarantor agrees that such service upon receipt (i) shall be deemed in every respect effective service of process upon it in any such suit, action or proceeding and (ii) shall, to the fullest extent permitted by applicable law, be taken and held to be valid personal service upon and personal delivery to it. Notices hereunder shall be conclusively presumed received as evidenced by a delivery receipt furnished by the United States Postal Service or any reputable commercial delivery service.

     (c) Nothing in this Section 12 shall affect the right of any holder of a Note to serve process in any manner permitted by law, or limit any right that the holders of any of the Notes may have to bring proceedings against any Guarantor in the courts of any appropriate jurisdiction or to enforce in any lawful manner a judgment obtained in one jurisdiction in any other jurisdiction.

     (d) EACH GUARANTOR WAIVES TRIAL BY JURY IN ANY ACTION BROUGHT ON OR WITH RESPECT TO THIS AGREEMENT, THE NOTES OR ANY OTHER DOCUMENT EXECUTED IN CONNECTION HEREWITH OR THEREWITH.

     SECTION 13. Miscellaneous. Any provision of this Guaranty 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

 7

Exhibit 1.3

unenforceable such provision in any other jurisdiction. To the extent permitted by applicable law, each Guarantor hereby waives any provision of law that renders any provisions hereof prohibited or unenforceable in any respect. The terms of this Guaranty shall be binding upon, and inure to the benefit of, each Guarantor and the Holders and their respective successors and assigns. No term or provision of this Guaranty may be changed, waived, discharged or terminated orally, but only by an instrument in writing signed by each Guarantor and the Required Holders. The section and paragraph headings in this Guaranty and the table of contents are for convenience of reference only and shall not modify, define, expand or limit any of the terms or provisions hereof, and all references herein to numbered sections, unless otherwise indicated, are to sections in this Guaranty. This Guaranty shall in all respects be governed by, and construed in accordance with, the laws of the State of Illinois, including all matters of construction, validity and performance.

 8

Exhibit 1.3

     IN WITNESS WHEREOF, each Guarantor has caused this Guaranty to be duly executed as of the day and year first above written.

TRADE SECRET, INC.
SUPERCUTS, INC.
THE BARBERS, HAIRSTYLING FOR MEN AND WOMEN, INC.
SUPERCUTS CORPORATE SHOPS, INC.
REGIS CORP.
REGIS, INC.
HAIR CLUB FOR MEN, LLC

By:

Name:

Title:

 9

Exhibit 1.3

FORM OF JOINDER TO SUBSIDIARY GUARANTY

     The undersigned (the “Guarantor”), joins in the Subsidiary Guaranty dated as of March 15, 2005 from the Guarantors named therein in favor of the Holders, as defined therein, and agrees to be bound by all of the terms thereof and represents and warrants to the Holders that:

     (a) the Guarantor is duly organized, validly existing and in good standing under the laws of its jurisdiction of organization and has the requisite power and authority 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;

     (b) the Guarantor has the requisite power and authority and the legal right to execute and deliver this Joinder to Subsidiary Guaranty (“Joinder”) and to perform its obligations hereunder and under the Subsidiary Guaranty and has taken all necessary action to authorize its execution and delivery of this Joinder and its performance of the Subsidiary Guaranty;

     (c) the Subsidiary Guaranty constitutes a legal, valid and binding obligation of the Guarantor enforceable in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights generally and by general equitable principles (regardless of whether such enforceability is considered in a proceeding in equity or at law);

     (d) the execution, delivery and performance of this Joinder will not (i) contravene, result in any breach of, or constitute a default under, or result in the creation of any Lien in respect of any property of such Guarantor under any indenture, mortgage, deed of trust, loan, credit agreement, corporate charter or by-laws, or any other agreement evidencing Debt, (ii) contravene, result in any breach of, or constitute a default under, or result in the creation of any Lien in respect of any property of such Guarantor under, any other agreement or instrument to which such Guarantor is bound or by which such Guarantor or any of its properties may be bound or affected, except as could not reasonably be expected to have a Material Adverse Effect, (iii) conflict with or result in a breach of any of the terms, conditions or provisions of any order, judgment, decree, or ruling of any court, arbitrator or Governmental Authority applicable to such Guarantor, except as could not reasonably be expected to have a Material Adverse Effect, or (iv) violate any provision of any statute or other rule or regulation of any Governmental Authority applicable to such Guarantor, except as could not reasonably be expected to have a Material Adverse Effect;

     (e) no consent, approval or authorization of, or registration, filing or declaration with, any Governmental Authority is required in connection with the execution, delivery or performance by such Guarantor of this Joinder;

 10

Exhibit 1.3

     (f) except as disclosed in writing to the holders, no litigation, investigation or proceeding of or before any arbitrator or governmental authority is pending or, to the knowledge of the Guarantor, threatened by or against the Guarantor or any of its properties or revenues (i) with respect to this Joinder, the Subsidiary Guaranty or any of the transactions contemplated hereby or (ii) that could reasonably be expected to have a material adverse effect on the business, operations or financial condition of the Guarantor and its subsidiaries taken as a whole;

     (g) such Guarantor (after giving due consideration to any rights of contribution) has received fair consideration and reasonably equivalent value for the incurrence of its obligations hereunder or as contemplated hereby and after giving effect to the transactions contemplated herein, (i) the fair value of the assets of such Guarantor (both at fair valuation and at present fair saleable value) exceeds its liabilities, (ii) such Guarantor is able to and expects to be able to pay its debts as they mature, and (iii) such Guarantor has capital sufficient to carry on its business as conducted and as proposed to be conducted.

Capitalized Terms used but not defined herein have the meanings ascribed in the Subsidiary Guaranty.

          IN WITNESS WHEREOF, the undersigned has caused this Joinder to Subsidiary Guaranty to be duly executed as of ___, ___.

[Name of Guarantor]

By:

Name:

Title:

 11

Exhibit 1.3

EXHIBIT 4.4(a)

FORM OF OPINION COUNSEL
FOR THE COMPANY

     The opinion of Eric Bakken, Vice President and General Counsel for the Company, shall be to the effect that:

     1. Each of the Company and each Subsidiary Guarantor is a corporation duly incorporated, validly existing and in good standing under the laws of its jurisdiction of incorporation, and each has all requisite corporate power and authority to own and operate its properties, to carry on its business as now conducted, and, in the case of the Company, to enter into and perform the Note Purchase Agreement and to issue and sell the Notes and, in the case of each Subsidiary Guarantor, to enter into and perform the Subsidiary Guaranty.

     2. The Note Purchase Agreement and the Notes have been duly authorized by proper corporate action on the part of the Company, have been duly executed and delivered by an authorized officer of the Company and constitute the legal, valid and binding agreements of the Company, enforceable in accordance with their terms, except to the extent that enforcement thereof may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws of general application relating to or affecting the enforcement of the rights of creditors or by equitable principles, regardless of whether enforcement is sought in a proceeding in equity or at law.

     3. The Subsidiary Guaranty has been duly authorized by proper corporate action on the part of each Subsidiary Guarantor, has been duly executed and delivered by an authorized officer each such Subsidiary Guarantor and constitutes the legal, valid and binding obligation of each Subsidiary Guarantor, enforceable in accordance with its terms, except to the extent the enforcement thereof may be limited by applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or similar laws of general application relating to or affecting the enforcement of the rights of creditors or by equitable principles, regardless of whether enforcement is sought in a proceeding in equity or at law.

     4. A Minnesota court, or a federal court sitting in Minnesota, would honor the choice of Illinois law to govern the Note Purchase Agreement, the Notes and the Subsidiary Guaranty.

     5. Based on the representations set forth in the Agreement, the offering, sale and delivery of the Notes and delivery of the Subsidiary Guaranty do not require the registration of the Notes or the Subsidiary Guaranty under the Securities Act of 1933, as amended, or the qualification of an indenture under the Trust Indenture Act of 1939, as amended.

     6. No authorization, approval or consent of, and no designation, filing, declaration, registration and/or qualification with, any Governmental Authority is necessary or required in

Exhibit 4.4(a)

connection with the execution, delivery and performance by the Company of the Note Purchase Agreement or the offering, issuance and sale by the Company of the Notes, and no authorization, approval or consent of, and no designation, filing, declaration, registration and/or qualification with, any Governmental Authority is necessary or required in connection with the execution, delivery and performance by any Subsidiary Guarantor of the Subsidiary Guaranty.

     7. The issuance and sale of the Notes by the Company, and the execution, delivery and performance by the Company of the terms and conditions of the Notes and the Note Purchase Agreement do not conflict with, or result in any breach or violation of any of the provisions of, or constitute a default under, or result in the creation or imposition of any Lien on, the property of the Company or any Subsidiary pursuant to the provisions of (i) the certificate or articles of incorporation or bylaws of the Company or any Subsidiary, (ii) any loan agreement known to such counsel to which the Company or any Subsidiary is a party or by which any of them or their property is bound, (iii) any other agreement or instrument known to such counsel to which the Company or any Subsidiary is a party or by which any of them or their property is bound, (iv) any law (including usury laws) or regulation applicable to the Company, or (v) to the knowledge of such counsel, any order, writ, injunction or decree of any court or Governmental Authority applicable to the Company.

     8. The execution, delivery and performance of the Subsidiary Guaranty will not conflict with, or result in any breach or violation of any of the provisions of, or constitute a default under, or result in the creation or imposition of any Lien on, the property of any Subsidiary Guarantor pursuant to the provisions of (i) its certificate or articles of incorporation or by-laws, (ii) any loan agreement known to such counsel to which any Subsidiary Guarantor is a party or by which it or its property is bound, (iii) any other agreement or instrument known to such counsel to which any Subsidiary Guarantor is a party or by which it or its property is bound, (iv) any law or regulation applicable to any Subsidiary Guarantor, or (v) to the knowledge of such counsel, any order, writ, injunction or decree of any court or Governmental Authority applicable to any Subsidiary Guarantor.

     9. There are no actions, suits or proceedings pending, or, to such counsel’s knowledge, threatened against, or affecting the Company or any Subsidiary, at law or in equity or before or by any Governmental Authority, that are likely to result, individually or in the aggregate, in a Material Adverse Effect.

     10. Neither the Company nor any Subsidiary is (i) a “public utility company” or a “holding company,” or a “subsidiary company” of a “holding company,” as such terms are defined in the Public Utility Holding Company Act of 1935, as amended, (ii) a “public utility” as defined in the Federal Power Act, as amended, or (iii) an “investment company” or a company “controlled” by an “investment company,” as such terms are defined in the Investment Company Act of 1940, as amended.

     11. The issuance of the Notes and the intended use of the proceeds of the sale of the Notes do not violate or conflict with Regulation U, T or X of the Board of Governors of the Federal Reserve System.

 2

Exhibit 4.4(a)

The opinion of Eric Bakken shall cover such other matters relating to the sale of the Notes as the Purchasers may reasonably request. With respect to matters of fact on which such opinion is based, such counsel shall be entitled to rely on appropriate certificates of public officials and officers of the Company. The opinion of Eric Bakken may be limited to the laws of the United States of America, the Delaware General Corporation Law and the laws of the State of Minnesota. For purposes of their opinion as to enforceability in paragraphs 2 and 3, Eric Bakken may assume that Minnesota law applies. Such opinion shall state that subsequent transferees and assignees of the Notes may rely thereon.

 3

Exhibit 4.4(a)

EXHIBIT 4.4(b)

FORM OF OPINION OF SPECIAL COUNSEL
TO THE PURCHASERS

     The opinion of Gardner Carton & Douglas LLP, special counsel to the Purchasers, shall be to the effect that:

     1. The Company is a corporation organized and validly existing in good standing under the laws of the State of Minnesota, with requisite corporate power and authority to enter into the Agreement and to issue and sell the Notes.

     2. The Agreement and the Notes have been duly authorized, executed and delivered by and constitute the legal, valid and binding agreements of the Company, enforceable in accordance with their terms, except to the extent that enforcement thereof may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws of general application relating to or affecting the enforcement of the rights of creditors or by equitable principles, regardless of whether enforcement is sought in a proceeding in equity or at law.

     3. The Subsidiary Guaranty constitutes the legal, valid and binding obligation of each Subsidiary Guarantor, enforceable in accordance with their terms, except to the extent that enforcement thereof may be limited by applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or similar laws of general application relating to or affecting the enforcement of the rights of creditors or by equitable principles, regardless of whether enforcement is sought in a proceeding in equity or at law.

     4. Based upon the representations set forth in the Agreement, the offering, sale and delivery of the Notes and delivery of the Subsidiary Guaranty do not require the registration of the Notes or the Subsidiary Guaranty under the Securities Act of 1933, as amended, nor the qualification of an indenture under the Trust Indenture Act of 1939, as amended.

     5. The issuance and sale of the Notes and compliance with the terms and provisions of the Notes and the Agreement will not conflict with or result in any breach of any of the provisions of the Certificate of Incorporation or By-Laws of the Company.

     6. No approval, consent or withholding of objection on the part of, or filing, registration or qualification with, any governmental body, Federal or state, is necessary in connection with the execution and delivery of the Note Purchase Agreement or the Series 2005-A Notes.

lhe opinion of Gardner Carton & Douglas LLP shall cover such other matters relating to the sale of the Notes as the Purchasers may reasonably request. Such opinion shall state that subsequent transferees and assignees of the Notes may rely thereon. As to matters of Minnesota law, Gardner Carton & Douglas LLP may rely upon the opinion of Eric Bakken.

Exhibit 4.4(b)

EX-99.3

EXHIBIT 99.3

EXECUTION COPY

REGIS CORPORATION

FIRST AMENDMENT TO
NOTE PURCHASE AGREEMENT

$125,000,000
Senior Notes

$58,000,000
6.73% Senior Notes, Series A
due March 15, 2009

$67,000,000
7.20% Senior Notes, Series B
due March 15, 2012

Dated as of March 1, 2005

To  the Holders of the Senior Notes
of Regis Corporation Named
in the Attached Schedule I

Ladies and Gentlemen:

     Reference is made to the Note Purchase Agreement dated as of March 1, 2002 (the “Note Agreement”), between Regis Corporation, a Minnesota corporation (the “Company”), and you pursuant to which the Company issued $58,000,000 aggregate principal amount of its 6.73% Senior Notes, Series A, due March 15, 2009 (the “Series A Notes”) and $67,000,000 aggregate principal amount of its 7.20% Senior Notes, Series B, due March 15, 2012 (the “Series B Notes” and, together with the Series A Notes, the “Notes”). You are referred to herein individually as a “Holder” and collectively as the “Holders”. Capitalized terms used and not otherwise defined herein shall have the meanings ascribed to them in the Note Agreement, as amended hereby.

     The Company has requested that the Note Agreement be amended to include a Consolidated Net Worth test and to exclude Section 10.7 (Restricted Payments) and Section 10.8 (Investments). You have agreed to such amendment on the terms and subject to the conditions set forth herein.

     In consideration of the premises and for good and valuable consideration, the receipt and sufficiency of which are acknowledged, the Company and the Holders agree as follows:

1.   AMENDMENT OF NOTE AGREEMENT

     1.1. Amendment of Section 10.1. Section 10.1 of the Note Agreement is amended to read in its entirety as follows:

     “10.1 Consolidated Net Worth; Consolidated Net Debt.

     (a) The Company will not permit at any time Consolidated Net Worth to be less than $600,000,000 plus (i) the cumulative sum of 25% of Consolidated Net Income (but only if a positive number) for each completed fiscal quarter, or portion thereof, ended after December 31, 2004, and (ii) 50% of the net cash proceeds from any issuance by the Company of any equity securities.

     (b) The Company will not permit at any time the ratio of Consolidated Net Debt (as of the last day of the most recently completed fiscal quarter) to Consolidated EBITDA (for the Company’s then most recently completed four fiscal quarters) to be greater than 2.75 to 1.00 at any time. If, during the period for which Consolidated EBITDA is being calculated, the Company or a Restricted Subsidiary has (i) acquired one or more Persons (or the assets thereof) or (ii) disposed of one or more Restricted Subsidiaries (or substantially all of the assets thereof), Consolidated EBITDA shall be calculated on a pro forma basis as if all of such acquisitions (other than acquisitions by or resulting in Unrestricted Subsidiaries) and all such dispositions had occurred on the first day of such period.”

     1.2. Section 10.7. Section 10.7 of the Note Agreement is amended to read in its entirety as follows:

     “10.7. Reserved.”

     1.3. Section 10.8. Section 10.8 of the Note Agreement is amended to read in its entirety as follows:

     “10.8. Reserved.”

2.   REAFFIRMATION; REPRESENTATIONS AND WARRANTIES

     2.1. Reaffirmation of Note Agreement. The Company reaffirms its agreement to comply with each of the covenants, agreements and other provisions of the Note Agreement and the Notes, including the amendment of such provisions effected by this First Amendment.

     2.2. Note Agreement. The Company represents and warrants that the representations and warranties contained in the Note Agreement are true and correct as of the date hereof, except (a) to the extent that any of such representations and warranties specifically relate to an earlier

2

date, (b) for such changes, facts, transactions and occurrences that have arisen since March 7, 2002 in the ordinary course of business, (c) for such other matters as have been previously disclosed in writing by the Company (including in its financial statements and notes thereto) to the Holders and (d) for other changes that could not reasonably be expected to have a Material Adverse Effect.

     2.3. No Default or Event of Default. After giving effect to the transactions contemplated hereby, there will exist no Default or Event of Default.

     2.4. Authorization. The execution, delivery and performance by the Company of this First Amendment have been duly authorized by all necessary corporate action and, except as provided herein, do not require any registration with, consent or approval of, notice to or action by, any Person (including any Governmental Authority) in order to be effective and enforceable. The Note Agreement and this First Amendment each constitute the legal, valid and binding obligations of the Company, enforceable in accordance with their respective terms, except as such enforceability may be limited by (i) applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or other similar laws affecting the enforcement of creditors’ rights generally and (ii) general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law).

3.   EFFECTIVE DATE

     This First Amendment shall become effective as of the date set forth above upon the satisfaction of the following conditions:

     3.1. Consent of Holders to First Amendment. Execution by the Holders of at least a majority of the aggregate principal amount of the Notes outstanding and receipt by the Holders of a counterpart of this First Amendment duly executed by the Company.

     3.2. Expenses. The Company shall have paid all reasonable fees and expenses of Gardner Carton & Douglas LLP, special counsel to the Holders, to the extent reflected in a statement of such counsel rendered to the Company at least one Business Day prior to the date this First Amendment would otherwise become effective (such statement to include reasonable detail as to the basis for such fees and expenses).

4.   MISCELLANEOUS

     4.1. Ratification. Except as amended hereby, the Note Agreement, including the representations and warranties contained therein, shall remain in full force and effect and is ratified, approved and confirmed in all respects as of the date hereof (it being understood that the representations and warranties are not hereby being remade, except as specifically set forth in Section 2.2 above).

     4.2. Reference to and Effect on the Note Agreement. Upon the final effectiveness of this First Amendment, each reference in the Note Agreement and in other documents describing or referencing the Note Agreement to the “Agreement,” “Note Agreement,” “hereunder,”

3

“hereof,” “herein,” or words of like import referring to the Note Agreement, shall mean and be a reference to the Note Agreement, as amended hereby.

     4.3. Binding Effect. This First Amendment shall be binding upon and inure to the benefit of the respective successors and assigns of the parties hereto.

     4.4. Governing Law. This First Amendment shall be governed by and construed in accordance with Illinois law.

     4.5. Counterparts. This First Amendment may be executed in any number of counterparts, each executed counterpart constituting an original, but altogether only one instrument.

4

     IN WITNESS WHEREOF, the Company and the Holders have caused this First Amendment to be executed and delivered by their respective officer or officers thereunto duly authorized.

REGIS CORPORATION
By:	/s/ Randy Pearce
Name: Randy Pearce
Title: Executive Vice President & CFO

S-1

MONUMENTAL LIFE INSURANCE COMPANY
By:	/s/ Bill Henricksen
Name:	Bill Henricksen
Title:	Vice President

S-3

JACKSON NATIONAL LIFE INSURANCE
	COMPANY
	By: PPM America, Inc., as attorney in fact, on
	behalf of Jackson National Life Insurance
	Company
By:	/s/ [ILLEGIBLE]
Name:
Title:

JACKSON NATIONAL LIFE INSURANCE
	COMPANY OF NEW YORK
	By: PPM America, Inc., as attorney in fact, on
	behalf of Jackson National Life Insurance
	Company of New York
By:	/s/ [ILLEGIBLE]
Name:
Title:

S-4

PACIFIC LIFE INSURANCE COMPANY
By:	/s/ Bernard J. Dougherty
Name:	Bernard J. Dougherty
Title:	Assistant Vice President
By:	/s/ Cathy Schwartz
Name:	Cathy Schwartz
Title:	Assistant Secretary
		REGIS
		First Amendment to Note Purchase Agreement

S-5

PHOENIX LIFE INSURANCE COMPANY
By:	/s/ Christopher M. Wilkos
Name:	CHRISTOPHER M. WILKOS
Title:	Senior Vice President
	Corporate Portfolio Management
	PHOENIX LIFE INSURANCE COMPANY
PHL VARIABLE INSURANCE COMPANY
By:	/s/ Christopher M. Wilkos
Name:	CHRISTOPHER M. WILKOS, CFA
Title:	SENIOR VICE PRESIDENT
	CORPORATE PORTFOLIO MANAGEMENT
	PHL VARIABLE INSURANCE COMPANY

S-6

SECURITY FINANCIAL LIFE INSURANCE CO.
By:	/s/ Kevin W. Hammond
Name:	Kevin W. Hammond
Title:	Senior Director - Investments

S-8

CONFIRMATION

     Each of the undersigned acknowledges receipt of the foregoing First Amendment and confirms the continuing validity and enforceability against such undersigned of each of the Note Agreement, the Notes and the Subsidiary Guaranty to which such undersigned is a party.

REGIS CORPORATION
By:	/s/ Randy Pearce
Name:	Randy Pearce
Title:	Executive Vice President & CFO
TRADE SECRET, INC.
By:	/s/ Randy Pearce
Name: Title:	Randy Pearce Executive Vice President & CFO
SUPERCUTS, INC.
By:	/s/ Randy Pearce
Name:	Randy Pearce
Title:	Executive Vice President & CFO
THE BARBERS, HAIRSTYLING FOR MEN AND WOMEN, INC.
By:	/s/ Randy Pearce
Name:	Randy Pearce
Title:	Executive Vice President & CFO

S-9

REGIS INTERNATIONAL, LTD.
By:	/s/ Randy Pearce
Name:	Randy Pearce
Title:	Executive Vice President & CFO

S-10

SCHEDULE I

	Outstanding Principal
Series A Holders	Amount
Jackson National Life Insurance Company	$	9,000,000
Jackson National Life Insurance Company of New York		4,000,000
Teachers Insurance and Annuity Association of America		5,000,000
TIAA-CREF Life Insurance Company		5,000,000
Pacific Life Insurance Company		22,000,000
Phoenix Life Insurance Company		5,000,000
PHL Variable Insurance Company		3,000,000
Provident Mutual Life Insurance Company		5,000,000

	Outstanding Principal
Series B Holders	Amount
Teachers Insurance and Annuity Association of America	$	35,000,000
Monumental Life Insurance Company		30,000,000
Security Financial Life Insurance Co.		2,000,000

Schedule I