80,000,000 CREDIT FACILITY CREDIT AGREEMENT DATED AS OF APRIL 30, 1998 BY AND AMONG PACKAGED ICE, INC., AS BORROWER

1
Exhibit 10.1

--------------------------------------------------------------------------------

$80,000,000 CREDIT FACILITY
CREDIT AGREEMENT
DATED AS OF APRIL 30, 1998
BY AND AMONG
PACKAGED ICE, INC.,
AS BORROWER

ANTARES LEVERAGED CAPITAL CORP.
FOR ITSELF, AS A LENDER AND AS AGENT FOR ALL LENDERS

AND
THE OTHER FINANCIAL INSTITUTIONS PARTY HERETO
AS LENDERS

================================================================================
2
TABLE OF CONTENTS

PAGE
----

ARTICLE I. - THE CREDITS . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.1. Amounts and Terms of Commitments. . . . . . . . . . . . . . . . 1
1.2. Notes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1.3. Interest. . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1.4. Loan Accounts. . . . . . . . . . . . . . . . . . . . . . . . . . 5
1.5. Procedure for Revolving Loan and Acquisition Loan Borrowings. . 5
1.6. Conversion and Continuation Elections. . . . . . . . . . . . . . 6
1.7. Optional Prepayments. . . . . . . . . . . . . . . . . . . . . . 7
1.8. Mandatory Prepayments of Loans. . . . . . . . . . . . . . . . . 8
1.9. Fees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
1.10. Payments by the Borrower. . . . . . . . . . . . . . . . . . . . 11
1.11. Payments by the Lenders to the Agent. . . . . . . . . . . . . . 11
1.12. Disbursements of Advances; Settlements Among Agent and Lenders;
Payments of Interest and Fees; Disgorgement Obligations. . . . 12

ARTICLE II. - CONDITIONS PRECEDENT . . . . . . . . . . . . . . . . . . . . . 15
2.1. Conditions of Initial Loans. . . . . . . . . . . . . . . . . . . 15
2.2. Conditions to All Borrowings. . . . . . . . . . . . . . . . . . 19
2.3. Additional Conditions to Acquisition Loans. . . . . . . . . . . 20

ARTICLE III. - REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . . . . . . 21
3.1. Corporate Existence and Power. . . . . . . . . . . . . . . . . . 21
3.2. Corporate Authorization; No Contravention. . . . . . . . . . . . 22
3.3. Governmental Authorization. . . . . . . . . . . . . . . . . . . 23
3.4. Binding Effect. . . . . . . . . . . . . . . . . . . . . . . . . 23
3.5. Litigation. . . . . . . . . . . . . . . . . . . . . . . . . . . 23
3.6. No Default. . . . . . . . . . . . . . . . . . . . . . . . . . . 23
3.7. ERISA Compliance. . . . . . . . . . . . . . . . . . . . . . . . 24
3.8. Use of Proceeds; Margin Regulations. . . . . . . . . . . . . . . 24
3.9. Title to Properties. . . . . . . . . . . . . . . . . . . . . . . 24
3.10. Taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
3.11. Financial Condition. . . . . . . . . . . . . . . . . . . . . . 24
3.12. Environmental Matters. . . . . . . . . . . . . . . . . . . . . 25
3.13. Collateral Documents. . . . . . . . . . . . . . . . . . . . . . 26
3.14. Regulated Entities. . . . . . . . . . . . . . . . . . . . . . . 26
3.15. Solvency. . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
3.16. Labor Relations. . . . . . . . . . . . . . . . . . . . . . . . 26
3.17. Copyrights, Patents, Trademarks and Licenses, etc. . . . . . . 26

3.18. Subsidiaries. . . . . . . . . . . . . . . . . . . . . . . . . . 27
3.19. Brokers' Fees; Transaction Fees. . . . . . . . . . . . . . . . 27
3.20. Insurance. . . . . . . . . . . . . . . . . . . . . . . . . . . 27
3.21. Full Disclosure. . . . . . . . . . . . . . . . . . . . . . . . 27

ARTICLE IV. - AFFIRMATIVE COVENANTS . . . . . . . . . . . . . . . . . . . . . 27
4.1. Financial Statements. . . . . . . . . . . . . . . . . . . . . . 28
4.2. Certificates; Borrowing Base Certificates; Other Information. . 29
4.3. Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
4.4. Preservation of Corporate Existence, Etc. . . . . . . . . . . . 32
4.5. Maintenance of Property. . . . . . . . . . . . . . . . . . . . . 32
4.6. Insurance. . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
4.7. Payment of Obligations. . . . . . . . . . . . . . . . . . . . . 33
4.8. Compliance with Laws. . . . . . . . . . . . . . . . . . . . . . 33
4.9. Inspection of Property and Books and Records. . . . . . . . . . 34
4.10. Use of Proceeds. . . . . . . . . . . . . . . . . . . . . . . . 34
4.11. Solvency. . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
4.12. Further Assurances. . . . . . . . . . . . . . . . . . . . . . . 35

ARTICLE V. - NEGATIVE COVENANTS . . . . . . . . . . . . . . . . . . . . . . . 35
5.1. Limitation on Liens. . . . . . . . . . . . . . . . . . . . . . . 35
5.2. Disposition of Assets. . . . . . . . . . . . . . . . . . . . . . 37
5.3. Consolidations and Mergers. . . . . . . . . . . . . . . . . . . 38
5.4. Loans and Investments. . . . . . . . . . . . . . . . . . . . . . 38
5.5. Limitation on Indebtedness. . . . . . . . . . . . . . . . . . . 38
5.6. Transactions with Affiliates. . . . . . . . . . . . . . . . . . 39
5.7. Management Fees and Compensation. . . . . . . . . . . . . . . . 40
5.8. Use of Proceeds. . . . . . . . . . . . . . . . . . . . . . . . . 40
5.9. Contingent Obligations. . . . . . . . . . . . . . . . . . . . . 40
5.10. Compliance with ERISA. . . . . . . . . . . . . . . . . . . . . 40
5.11. Restricted Payments. . . . . . . . . . . . . . . . . . . . . . 41
5.12. Change in Business. . . . . . . . . . . . . . . . . . . . . . . 42
5.13. Change in Structure; Issuance of Disqualified Stock. . . . . . 42
5.14. Accounting Changes. . . . . . . . . . . . . . . . . . . . . . . 42
5.15. Amendments to Related Agreements; Indenture. . . . . . . . . . 42
5.16. Acquisitions. . . . . . . . . . . . . . . . . . . . . . . . . . 43

ARTICLE VI. - FINANCIAL COVENANTS . . . . . . . . . . . . . . . . . . . . . 44
6.1. Capital Expenditures. . . . . . . . . . . . . . . . . . . . . . 44
6.2. Leverage Ratio. . . . . . . . . . . . . . . . . . . . . . . . . 45
6.3. Fixed Charge Coverage Ratio. . . . . . . . . . . . . . . . . . . 46
6.4. Interest Coverage Ratio. . . . . . . . . . . . . . . . . . . . . 46

ii
4

ARTICLE VII. - EVENTS OF DEFAULT . . . . . . . . . . . . . . . . . . . . . . 47
7.1. Event of Default. . . . . . . . . . . . . . . . . . . . . . . . 47
7.2. Remedies. . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
7.3. Rights Not Exclusive. . . . . . . . . . . . . . . . . . . . . . 50
7.4. Cash Collateral for Letters of Credit. . . . . . . . . . . . . . 50

ARTICLE VIII. - THE AGENT . . . . . . . . . . . . . . . . . . . . . . . . . . 50
8.1. Appointment and Authorization. . . . . . . . . . . . . . . . . . 50
8.2. Delegation of Duties. . . . . . . . . . . . . . . . . . . . . . 50
8.3. Liability of Agent. . . . . . . . . . . . . . . . . . . . . . . 51
8.4. Reliance by Agent. . . . . . . . . . . . . . . . . . . . . . . . 51
8.5. Notice of Default. . . . . . . . . . . . . . . . . . . . . . . . 51
8.6. Credit Decision. . . . . . . . . . . . . . . . . . . . . . . . . 52
8.7. Indemnification. . . . . . . . . . . . . . . . . . . . . . . . . 52
8.8. Agent in Individual Capacity. . . . . . . . . . . . . . . . . . 53
8.9. Successor Agent. . . . . . . . . . . . . . . . . . . . . . . . . 53
8.10. Collateral Matters. . . . . . . . . . . . . . . . . . . . . . . 54

ARTICLE IX. - MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . 55
9.1. Amendments and Waivers. . . . . . . . . . . . . . . . . . . . . 55
9.2. Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
9.3. No Waiver; Cumulative Remedies. . . . . . . . . . . . . . . . . 56
9.4. Costs and Expenses. . . . . . . . . . . . . . . . . . . . . . . 56
9.5. INDEMNITY. . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
9.6. Marshaling; Payments Set Aside. . . . . . . . . . . . . . . . . 59
9.7. Successors and Assigns. . . . . . . . . . . . . . . . . . . . . 59
9.8. Assignments, Participations, etc. . . . . . . . . . . . . . . . 59
9.9. Confidentiality. . . . . . . . . . . . . . . . . . . . . . . . . 61
9.10. Set-off; Sharing of Payments. . . . . . . . . . . . . . . . . . 62
9.11. Notification of Addresses, Lending Offices, Etc. . . . . . . . 62
9.12. Counterparts. . . . . . . . . . . . . . . . . . . . . . . . . . 63
9.13. Severability. . . . . . . . . . . . . . . . . . . . . . . . . . 63
9.14. Captions. . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
9.15. Independence of Provisions. . . . . . . . . . . . . . . . . . . 63
9.16. Interpretation. . . . . . . . . . . . . . . . . . . . . . . . . 63
9.17. No Third Parties Benefited. . . . . . . . . . . . . . . . . . . 63
9.18. Governing Law and Jurisdiction. . . . . . . . . . . . . . . . . 63
9.19. Waiver of Jury Trial. . . . . . . . . . . . . . . . . . . . . . 64
9.20. Entire Agreement; Release. . . . . . . . . . . . . . . . . . . 65

ARTICLE X. - TAXES, YIELD PROTECTION AND ILLEGALITY . . . . . . . . . . . . . 65
10.1. Taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
10.2. Illegality. . . . . . . . . . . . . . . . . . . . . . . . . . . 67

iii
5

10.3. Increased Costs and Reduction of Return. . . . . . . . . . . . 68
10.4. Funding Losses. . . . . . . . . . . . . . . . . . . . . . . . . 69
10.5. Inability to Determine Rates. . . . . . . . . . . . . . . . . . 69
10.6. Reserves on LIBOR Rate Loans. . . . . . . . . . . . . . . . . . 70
10.7. Certificates of Lenders. . . . . . . . . . . . . . . . . . . . 70
10.8. Survival. . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
10.9. Replacement of Lender in Respect of Increased Costs. . . . . . 70

ARTICLE XI. - DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . 71
11.1. Defined Terms. . . . . . . . . . . . . . . . . . . . . . . . . 71
11.2. Other Interpretive Provisions. . . . . . . . . . . . . . . . . 89
11.3. Accounting Principles. . . . . . . . . . . . . . . . . . . . . 89

iv
6
SCHEDULES

Schedule 1.1(a) Revolving Loan Commitments
Schedule 1.1(c) Acquisition Loan Commitments
Schedule 2.1 Material Owned Facilities
Schedule 3.2 Capitalization
Schedule 3.5 Litigation
Schedule 3.7 ERISA
Schedule 3.9 Owned Real Property
Schedule 3.17 Intellectual Property
Schedule 3.19 Brokers' Fees
Schedule 5.1 Liens
Schedule 5.5 Indebtedness
Schedule 5.9 Contingent Obligations
Schedule 11.1 Prior Indebtedness

EXHIBITS

Exhibit 1.8(d) Excess Cash Flow Certificate
Exhibit 4.2(b) Compliance Certificate
Exhibit 11.1(a) Acquisition Note
Exhibit 11.1(b) Borrowing Base Certificate
Exhibit 11.1(c) Notice of Borrowing
Exhibit 11.1(d) Notice of Continuation/Conversion
Exhibit 11.1(e) Revolving Note

v
7
CREDIT AGREEMENT

This CREDIT AGREEMENT (this "Agreement") is entered into as of April 30,
1998, by and among Packaged Ice, Inc., a Texas corporation (the "Borrower"),
Antares Leveraged Capital Corp., a Delaware corporation, as agent (the "Agent")
for the several financial institutions from time to time party to this
Agreement (collectively, the "Lenders" and individually each a "Lender") and
for itself as a Lender, and such Lenders.

W I T N E S S E T H:

WHEREAS, the Borrower has requested, and the Lenders have agreed to make
available to the Borrower, a revolving credit facility (including a letter of
credit subfacility) and an acquisition credit facility upon and subject to the
terms and conditions set forth in this Agreement;

NOW, THEREFORE, in consideration of the mutual agreements, provisions
and covenants contained herein, the parties agree as follows:

ARTICLE I. - THE CREDITS

1.1. Amounts and Terms of Commitments.

(a) The Revolving Credit. Each Lender with a Revolving Loan
Commitment severally and not jointly agrees, on the terms and conditions
hereinafter set forth, to make Loans to the Borrower (each such Loan, a
"Revolving Loan") from time to time on any Business Day during the period from
the Closing Date to the Revolving Termination Date, in an aggregate amount not
to exceed at any time outstanding the amount set forth opposite the Lender's
name in Schedule 1.1(a) under the heading "Revolving Loan Commitment" (such
amount as the same may be reduced from time to time as a result of one or more
assignments pursuant to Section 9.8, being referred to herein as such Lender's
"Revolving Loan Commitment"); provided, however, that, after giving effect to
any Borrowing of Revolving Loans, the aggregate principal amount of all
outstanding Revolving Loans shall not exceed the Maximum Revolving Loan
Balance. Subject to the other terms and conditions hereof, amounts borrowed
under this subsection 1.1(a) may be repaid and reborrowed from time to time.
The "Maximum Revolving Loan Balance" from time to time will be the lesser of:

(i) the Borrowing Base at such time (as calculated pursuant to the
most recent Borrowing Base Certificate required to be delivered pursuant to
subsection 4.2(d)), less the sum of the aggregate amount of Letter of Credit
Participation Liability at such time and the aggregate principal amount of all
Acquisition Loans outstanding at such time, or

(ii) the Aggregate Revolving Loan Commitment then in effect, less the
aggregate amount of Letter of Credit Participation Liability.
8
If at any time the Revolving Loans exceed the Maximum Revolving Loan
Balance, then Revolving Loans (and/or Acquisition Loans in the event the
Revolving Loans exceed the Maximum Revolving Loan Balance due to clause (i)
above) must be repaid within thirty (30) days in an amount sufficient to
eliminate such excess.

(b) Lender Letters of Credit and Letter of Credit Participation
Agreements. Subject to the terms and conditions of this Agreement and in
reliance upon the representations and warranties of Borrower herein set forth,
the Revolving Loan Commitment may, in addition to advances under the Revolving
Loan, be utilized, upon the request of Borrower, for (i) the issuance of
letters of credit by Agent (each such letter of credit, a "Lender Letter of
Credit") or (ii) the issuance of letter of credit participation agreements by
Agent (each such letter of credit participation, a "Letter of Credit
Participation Agreement") to confirm payment to banks (whether or not such
banks are Lenders) which issue letters of credit for the account of Borrower on
behalf of each Lender having a Revolving Loan Commitment (severally and not
jointly) according to such Lender's Revolving Loan Commitment. The aggregate
amount of Letter of Credit Participation Liability with respect to all Lender
Letters of Credit and Letter of Credit Participation Agreements outstanding at
any time shall not exceed $2,000,000.

The Borrower shall be irrevocably and unconditionally obligated
forthwith without presentment, demand, protest or other formalities of any
kind, to reimburse the Agent for any amounts paid by the Agent under any Lender
Letter of Credit or Letter of Credit Participation Agreement. The Borrower
hereby authorizes and directs the Lenders with Revolving Loan Commitments, at
the Agent's option, to make a Revolving Loan in the amount of any payment made
by the Agent with respect to any Lender Letter of Credit or Letter of Credit
Participation Agreement. All amounts paid by the Agent with respect to any
Lender Letter of Credit or Letter of Credit Participation Agreement that are
not immediately repaid by Borrower with the proceeds of a Revolving Loan or
otherwise shall bear interest at the interest rate then applicable to Revolving
Loans, calculated using the Base Rate and the Applicable Margin in effect.
Each Lender agrees to fund its Commitment Percentage of any Revolving Loan made
pursuant to this subsection 1.1(b) and, if no such Revolving Loans are made,
each Lender with a Revolving Loan Commitment agrees to purchase, and shall be
deemed to have purchased, a participation in such Lender Letter of Credit or
Letter of Credit Participation Agreement in an amount equal to its ratable
share of such Lender Letter of Credit or Letter of Credit Participation
Agreement based upon the Revolving Loan Commitments then in effect and each
Lender agrees to pay to the Agent such share of any payments made by the Agent
under such Lender Letter of Credit or Letter of Credit Participation Agreement.
The obligations of each Lender under the preceding two (2) sentences shall be
absolute and unconditional and such remittance shall be made notwithstanding
the occurrence or continuation of an Event of Default or Default or the failure
to satisfy any condition set forth in Section 2.2 hereof.

In addition to all other terms and conditions set forth in this
Agreement, the issuance by Agent of any Lender Letter of Credit or Letter of
Credit Participation Agreement shall be subject to the conditions precedent
that the Lender Letter of Credit, Letter of Credit Participation

2
9
Agreement or the letter of credit or written contract for which Borrower
requests a Letter of Credit Participation Agreement shall support a transaction
entered into by Borrower in the Ordinary Course of Business of the Borrower and
shall be in such form, be for such amount, and contain such terms as are
reasonably satisfactory to Agent.

The expiration date of each Lender Letter of Credit shall be on a date
which is the earlier of (a) one year from its date of issuance, or (b) the
thirtieth (30th) day before the Revolving Termination Date. Each Letter of
Credit Participation Agreement shall provide that the Letter of Credit
Participation Agreement terminates and all demands or claims for payment must
be presented by a date certain, which date will be the earlier of (a) one year
from its date of issuance, or (b) the thirtieth day before the Revolving
Termination Date.

Borrower shall give Agent at least ten (10) Business Days prior notice
specifying the date a Lender Letter of Credit or Letter of Credit Participation
Agreement is to be issued, identifying the beneficiary and describing the
nature of the transactions proposed to be supported thereby. The notice shall
be accompanied by the drawing terms for the Lender Letter of Credit or form of
each letter of credit or other written contract which will be supported by the
Letter of Credit Participation Agreement.

(c) The Acquisition Credit. Each Lender with an Acquisition Loan
Commitment severally and not jointly agrees, on the terms and conditions
hereinafter set forth, to make Loans to the Borrower in connection with the
financing of Acquisitions (each such Loan, an "Acquisition Loan") from time to
time on any Business Day during the period from the Closing Date to the
Acquisition Termination Date, in an aggregate amount not to exceed at any time
outstanding the amount set forth opposite the Lender's name in Schedule 1.1(c)
under the heading "Acquisition Loan Commitment" (such amount as the same may be
reduced as a result of one or more assignments pursuant to Section 9.8, being
referred to herein as such Lender's "Acquisition Loan Commitment", provided
that from and after the Acquisition Termination Date, "Acquisition Loan
Commitment" shall refer to the outstanding amount of such Lender's Acquisition
Loans); provided, however, that after giving effect to any Borrowing of
Acquisition Loans, the aggregate principal amount of all outstanding
Acquisition Loans shall not exceed the Maximum Acquisition Loan Balance.
Subject to the other terms and conditions hereof, amounts borrowed under this
subsection 1.1(c) may be repaid and reborrowed from time to time. The "Maximum
Acquisition Loan Balance" from time to time will be the lesser of:

(i) the Borrowing Base at such time, less the sum of the
aggregate amount of Letter of Credit Participation Liability at such
time and the aggregate unpaid principal amount of all Revolving Loans
outstanding at such time, or

(ii) the Aggregate Acquisition Loan Commitment.

If at any time the Acquisition Loans exceed the Maximum Acquisition Loan
Balance, then Acquisition Loans (and/or Revolving Loans in the event the
Acquisition Loans exceed the

3
10
Maximum Acquisition Loan Balance due to clause (i) above) must be repaid within
thirty (30) days in an amount sufficient to eliminate such excess.

1.2. Notes. The Revolving Loans made by each Lender with a Revolving
Loan Commitment shall be evidenced by a Revolving Note payable to the order of
such Lender in an amount equal to such Lender's Revolving Loan Commitment. The
Acquisition Loans made by each Lender with an Acquisition Loan Commitment shall
be evidenced by an Acquisition Note payable to the order of such Lender in an
amount equal to such Lender's Acquisition Loan Commitment.

1.3. Interest. (a) Subject to subsections 1.3(c) and 1.3(d), each
Loan shall bear interest on the outstanding principal amount thereof from the
date when made at a rate per annum equal to the LIBOR or the Base Rate, as the
case may be, plus the Applicable Margin, as the same may be adjusted pursuant
to the provisions of the definition of Applicable Margin. Commencing on June
30, 1999, and continuing thereafter, the Applicable Margin for Loans shall be
subject to adjustment as set forth in the definition of Applicable Margin. The
Agent will with reasonable promptness notify the Borrower and the Lenders of
the effective date and the amount of each such change, provided that any
failure to do so shall not relieve the Borrower of any liability hereunder or
provide the basis for any claim against the Agent. Each determination of an
interest rate by the Agent shall be conclusive and binding on the Borrower and
the Lenders in the absence of demonstrative error. All computations of fees
and interest payable under this Agreement shall be made on the basis of a 360-
day year and actual days elapsed. 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) Interest on each Loan shall be paid in arrears on each Interest
Payment Date. Interest shall also be paid on the date of any payment or
prepayment of Loans in full.

(c) At the election of the Agent or the Required Lenders while any
Event of Default exists, the Borrower shall pay interest (after as well as
before entry of judgment thereon to the extent permitted by law) on the
Obligations, at a rate per annum which is determined by adding two percent
(2.0%) per annum to the Applicable Margin then in effect for such Loans (plus
the LIBOR or Base Rate, as the case may be) and, in the case of Obligations not
subject to an Applicable Margin (other than the fees described in Section
1.9(c)), at a rate per annum equal to the Base Rate plus two percent (2.0%);
provided, however, that, on and after the expiration of any Interest Period
applicable to any LIBOR Rate Loan outstanding on the date of occurrence of such
Event of Default, the principal amount of such Loan shall, during the
continuation of such Event of Default, bear interest at a rate per annum equal
to the Base Rate plus the Applicable Margin plus two percent (2.0%).

(d) It is the intention of the parties hereto to comply with all
applicable usury laws, whether now existing or hereafter enacted. Accordingly,
notwithstanding any provision to the contrary in this Agreement, the Notes, the
other Loan Documents or any other document evidencing, securing, guaranteeing
or otherwise pertaining to Indebtedness of the Borrower to

4
11
any Lender, in no contingency or event whatsoever, whether by acceleration of
the maturity of Indebtedness of the Borrower to such Lender or otherwise, shall
the interest contracted for, charged or received by such Lender exceed the
maximum amount permissible under any law applicable to such Lender. If from
any circumstances whatsoever fulfillment of any provisions of this Agreement,
the Notes, the other Loan Documents or of any other document evidencing,
securing, guaranteeing or otherwise pertaining to Indebtedness of the Borrower
to any Lender, at the time performance of such provision shall be due, shall
involve transcending the limit of validity prescribed by law, then, ipso facto,
the obligation to be fulfilled shall be reduced to the limit of such validity,
and if from any such circumstances such Lender shall ever receive anything of
value as interest or deemed interest by applicable law under this Agreement,
the Notes, the other Loan Documents or any other document evidencing, securing,
guaranteeing or otherwise pertaining to Indebtedness of the Borrower to such
Lender or otherwise an amount that would exceed the highest lawful amount, such
amount that would be excessive interest shall be applied to the reduction of
the principal amount owing in connection with this Agreement or on account of
any other Indebtedness of the Borrower to such Lender, and not to the payment
of interest, or if such excessive interest exceeds the unpaid balance of
principal owing to such Lender in connection with this Agreement and such other
Indebtedness, such excess shall be refunded by such Lender to the Borrower. In
determining whether or not the interest paid or payable with respect to
Indebtedness of the Borrower to any Lender, under any specific contingency,
exceeds the maximum nonusurious rate permitted under law applicable to such
Lender, the Borrower and such Lender shall, to the maximum extent permitted by
applicable law, (a) characterize any non-principal payment as an expense, fee
or premium rather than as interest, (b) exclude voluntary prepayments and the
effects thereof, (c) amortize, prorate, allocate and spread the total amount of
interest throughout the full term of such Indebtedness so that the actual rate
of interest on account of such Indebtedness does not exceed the maximum amount
permitted by applicable law, and/or (d) allocate interest between portions of
such Indebtedness, to the end that no such portion shall bear interest at a
rate greater than that permitted by law. The terms and provisions of this
paragraph shall control and supersede every other conflicting provision of this
Agreement, the Notes and the other Loan Documents.

1.4. Loan Accounts. The Agent, on behalf of the Lenders, shall
record on its books and records the amount of each Loan made, the interest rate
applicable, all payments of principal and interest thereon and the principal
balance thereof from time to time outstanding. The Agent shall deliver to the
Borrower on a monthly basis a loan statement setting forth such record for the
immediately preceding month. Such record shall, absent demonstrative error, be
conclusive evidence of the amount of the Loans made by the Lenders to the
Borrower and the interest and payments thereon. Any failure to so record or
any error in doing so, or any failure to deliver such loan statement shall not,
however, limit or otherwise affect the obligation of the Borrower hereunder
(and under any Note) to pay any amount owing with respect to the Loans or
provide the basis for any claim against the Agent.

1.5. Procedure for Revolving Loan and Acquisition Loan Borrowings. (a)
Each Borrowing under the Revolving Loan or the Acquisition Loan shall be made
upon the Borrower's

5
12
irrevocable (subject to Section 10.5 hereof) written notice delivered to the
Agent in the form of a Notice of Borrowing, which notice must be received by
the Agent prior to 10:30 a.m. (Chicago time) (i) on the requested Borrowing
date in the case of each Base Rate Loan equal to or less than $1,000,000 and in
the case of the initial Loans to be made on the Closing Date, (ii) on the date
which is one (1) Business Day prior to the requested Borrowing date of each
Base Rate Loan in excess of $1,000,000 but equal to or less than $3,000,000 and
(iii) on the day which is three (3) Business Days prior to the requested
Borrowing date in the case of each LIBOR Rate Loan and each Base Rate Loan in
excess of $3,000,000; provided, that with respect to Loans subsequent to the
initial Loans, the Borrower may give notice of the requested Borrowing to the
Agent by telephone call, with such notice confirmed not later than the
following Business Day by delivery to the Agent of a signed Notice of
Borrowing. Such Notice of Borrowing shall specify:

(I) whether the Borrowing is to be comprised of Acquisition
Loans or Revolving Loans;

(II) the amount of the Borrowing (which shall be in an
aggregate minimum principal amount of $100,000 and multiples of $50,000
in excess thereof);

(III) the requested Borrowing date, which shall be a Business
Day;

(IV) whether the Borrowing is to be comprised of LIBOR Rate
Loans or Base Rate Loans; and

(V) if the Borrowing is to be LIBOR Rate Loans, the Interest
Period applicable to such Loans.

provided, however, that with respect to the Borrowings to be made on the
Closing Date, such Borrowings will consist of Base Rate Loans only and shall
remain so for not less than three (3) Business Days. Thereafter, Borrower may
request that Revolving Loans or Acquisition Loans be made as LIBOR Rate Loans
and that Loans be converted to or continued as LIBOR Rate Loans provided only
LIBOR Rate Loans having an Interest Period of one (1) month shall be permitted
during the first sixty (60) days after the Closing Date.

(b) Upon receipt of the Notice of Borrowing, the Agent will promptly
notify each Lender with a Commitment affected thereby of such Notice and of the
amount of such Lender's Commitment Percentage of the Borrowing.

(c) Unless Agent is otherwise directed in writing by Borrower, the
proceeds of each requested Borrowing after the Closing Date will be made
available to the Borrower by the Agent by wire transfer (or ACH transfer) of
such amount to the Borrower pursuant to the wire transfer instructions
specified on the signature page hereto.

1.6. Conversion and Continuation Elections. (a) The Borrower may
upon irrevocable (subject to subsection 10.2(c) and Section 10.5) written
notice to the Agent in accordance with

6
13
subsection 1.6(b) elect to convert on any Business Day, any Base Rate Loans
into LIBOR Rate Loans or elect to continue on the last day of the applicable
Interest Period any LIBOR Rate Loans having Interest Periods maturing on such
day, in each instance, in whole or in part in an amount not less than $100,000,
or that is in an integral multiple of $50,000 in excess thereof.

(b) The Borrower shall deliver a Notice of Conversion/Continuation to
be received by the Agent not later than 10:30 a.m. (Chicago time) at least
three (3) Business Days in advance of the requested Conversion Date or
continuation date, specifying:

(i) the proposed Conversion Date or continuation date;

(ii) the aggregate amount of Loans to be converted or renewed;
and

(iii) the duration of the requested Interest Period with respect
to the Loans to be converted or continued as LIBOR Rate Loans.

(c) If upon the expiration of any Interest Period applicable to LIBOR
Rate Loans, the Borrower has failed to select timely a new Interest Period to
be applicable to such LIBOR Rate Loans, as the case may be, or if any Event of
Default shall then exist, the Borrower shall be deemed to have elected to
convert such LIBOR Rate Loans into Base Rate Loans effective as of the
expiration date of such current Interest Period.

(d) Upon receipt of a Notice of Conversion/Continuation, the Agent
will promptly notify each Lender thereof. In addition, the Agent will, with
reasonable promptness, notify the Borrower and the Lenders of each
determination of a LIBOR Rate; provided that any failure to do so shall not
relieve the Borrower of any liability hereunder or provide the basis for any
claim against the Agent. All conversions and continuations shall be made pro
rata 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 shall otherwise agree, during the
existence of an Event of Default, the Borrower may not elect to have a Loan
converted into or continued as a LIBOR Rate Loan.

(f) Notwithstanding any other provision contained in this Agreement,
after giving effect to any Borrowing, or to any continuation or conversion of
any Loans, there shall not be more than seven (7) different Interest Periods in
effect.

1.7. Optional Prepayments. (a) Subject to Section 10.4, the
Borrower may at any time (i) upon at least one (1) Business Day's written
notice to the Agent, prepay the Loans in whole or in part in an amount greater
than $2,500,000 and (ii) prepay the Loans in part in an amount less than
$2,500,000 but greater than or equal to $100,000 without notice, in each
instance, without penalty or premium except as provided in Section 10.4.
Optional partial prepayments of the Acquisition Loans following the Acquisition
Loan Termination Date shall be applied against

7
14
scheduled installments of the Acquisition Loans pro rata against all such
scheduled installments based upon the respective amounts thereof. Optional
prepayments in part in amounts less than $100,000 shall not be permitted.

(b) The notice of any prepayment shall not thereafter be revocable by
the Borrower and the Agent will promptly notify each Lender thereof and of such
Lender's Commitment Percentage of such prepayment. The payment amount
specified in such notice shall be due and payable on the date specified
therein, together with any amounts required to be paid in connection therewith
pursuant to Section 10.4.

1.8. Mandatory Prepayments of Loans.

(a) Revolving Loan. The Borrower shall repay to the Lenders in
full on the date specified in clause (a) of the definition of "Revolving
Termination Date" the aggregate principal amount of the Revolving Loans
outstanding on the Revolving Termination Date.

(b) Scheduled Acquisition Loan Payments. The aggregate principal
amount of the Acquisition Loans shall be paid in twelve (12) scheduled
installments on the last day of each March, June, September and December,
commencing June 30, 2000. The amount of each of the first eleven (11)
scheduled installments shall be equal to 1/12th of the aggregate principal
amount of the Acquisition Loans as of the Acquisition Termination Date. The
final scheduled installment of the Acquisition Loans shall be due and payable
on March 31, 2003 and shall be equal to the remaining aggregate unpaid
principal amount of the Acquisition Loans on such date.

(i) make or agree to make a Disposition; or

(ii) suffer an Event of Loss;

and the aggregate amount of the Net Proceeds received by Borrower and its
Subsidiaries in connection with such Disposition or Event of Loss and all other
Dispositions and Events of Loss occurring during the fiscal year exceeds
$1,000,000, then (A) the Borrower shall promptly notify the Agent of such
proposed Disposition or Event of Loss (including the amount of the estimated
Net Proceeds to be received by the Borrower in respect thereof) and (B)
promptly upon receipt by the Borrower or its Subsidiary of the Net Proceeds of
such Disposition or Event of Loss, the Borrower shall deliver such Net Proceeds
to the Agent for distribution to the Lenders as a prepayment of the Loans,
which prepayment shall be applied in accordance with subsection 1.8(f) hereof.
Notwithstanding the foregoing, such prepayment shall not be required if the
Borrower or any of its Subsidiaries reinvests the Net Proceeds of such
Disposition or Event of Loss, or a portion thereof, in productive assets of a
kind then used or usable in the business of the Borrower (including without
limitation pursuant to an Acquisition), within one hundred eighty (180) days
after the date of such Disposition or Event of Loss or enters into a binding

8
15
commitment thereof within said one hundred eighty (180) day period and
subsequently makes such reinvestment within three hundred sixty (360) days
after the date of such Disposition or Event of Loss.

(d) Excess Cash Flow. Within five (5) days after the annual
financial statements for each year ending after December 31, 2000 are required
to be delivered under subsection 4.1(a) hereof, the Borrower shall deliver to
the Agent a written calculation of Excess Cash Flow of the Borrower for such
year in the form of Exhibit 1.8(d) and certified as correct on behalf of
Borrower by a Responsible Officer and concurrently therewith shall deliver to
the Agent, for distribution to the Lenders, an amount equal to 50% of such
Excess Cash Flow, for application to the Loans in accordance with the
provisions of subsection 1.8(f) hereof. Excess Cash Flow shall be calculated
in the manner set forth in Exhibit 1.8(f).

(e) Sale or Issuance of Equity Securities. If the Borrower shall at
any time or from time to time sell, in a public or private sale, or issue
capital stock or other equity securities of the Borrower (excluding (i) capital
stock of the Borrower issued to employees of the Borrower and its Subsidiaries
in the ordinary course of business pursuant to employee stock option plans and
(ii) capital stock of the Borrower issued in payment of all or a portion of the
purchase price for any Acquisition), then (i) the Borrower shall notify the
Agent of such proposed sale or issuance and (ii) promptly upon receipt by the
Borrower of the Net Issuance Proceeds of such sale or issuance, the Borrower
shall deliver such Net Issuance Proceeds to the Agent for distribution to the
Lenders as a prepayment of the Loans, which prepayment shall be applied in
accordance with subsection 1.8(f) hereof. Notwithstanding the foregoing, the
Borrower may first apply the Net Issuance Proceeds of an initial public
offering of the Borrower's common Stock to redeem shares of the Borrower's
Exchangeable Preferred Stock issued on or prior to the Closing Date and then
outstanding (including additional shares of Exchangeable Preferred Stock issued
after the Closing Date in lieu of cash dividends on such shares) in accordance
with the terms of such Exchangeable Preferred Stock so long as no Event of
Default shall have occurred and be continuing.

(f) Application of Prepayments. Any prepayments pursuant to
subsection 1.8(c) shall be applied first to prepay the Acquisition Loans (such
prepayments shall be applied to permanently reduce the Acquisition Loans
Commitments, if made prior to the Acquisition Termination Date, and shall be
applied to prepay scheduled installments of the Acquisition Loans pro rata
against all such scheduled installments based upon the respective amounts
thereof, if made following the Acquisition Termination Date) until the
Acquisition Loans shall have been repaid in full, and then to repay the
Revolving Loans (without reduction of the Revolving Loan Commitments). Any
prepayments pursuant to subsections 1.8(d) and (e), if made prior to the
Acquisition Termination Date, shall be applied to repay the Revolving Loans and
the Acquisition Loans, ratably (without reduction of the Revolving Loan
Commitments or the Acquisition Loan Commitments), and, if made following the
Acquisition Termination Date, shall be applied first to prepay scheduled
installments of the Acquisition Loans pro rata against all such scheduled
installments based upon the respective amounts thereof until the Acquisition
Loans shall have

9
16
been repaid in full, and then to repay the Revolving Loans (without reduction
of the Revolving Loan Commitments). To the extent permitted by the foregoing
sentences, amounts prepaid shall be applied first to any Base Rate Loans then
outstanding and then to outstanding LIBOR Rate Loans with the shortest Interest
Periods remaining. Together with each prepayment under this Section 1.8, the
Borrower shall pay any amounts required pursuant to Section 10.4 hereof.

1.9. Fees.

(a) Arrangement and Agent's Fees. The Borrower shall pay to the
Agent for the Agent's own account an arrangement fee and an agent's fee in the
amounts and at the times set forth in a letter agreement between the Borrower
and the Agent dated of even date herewith.

(b) Commitment Fees.

(i) The Borrower shall pay to the Agent, for the ratable
benefit of the Lenders having Revolving Loan Commitments, a fee (the
"Revolving Commitment Fee") in an amount equal to

(i) the Aggregate Revolving Loan Commitment, less

(ii) the sum of (x) the average daily balance of all
Revolving Loans outstanding plus (y) the average daily amount of
the Letter of Credit Participation Liability, in each case,
during the preceding calendar quarter,

multiplied by one-half of one percent (0.5%) per annum, such fee to be
payable quarterly in arrears on the first day of the calendar quarter
following the Closing Date and the first day of each calendar quarter
thereafter. The Revolving Commitment Fee provided in this subsection
1.9(b)(i) shall accrue at all times from and after the Closing Date to
the Revolving Termination Date.

(ii) The Borrower shall pay to the Agent, for the ratable
benefit of the Lenders having Acquisition Loan Commitments, a fee (the
"Acquisition Commitment Fee") in an amount equal to

(i) the Aggregate Acquisition Loan Commitment, less

(ii) the average daily balance of all Acquisition Loans
during the preceding calendar quarter.

multiplied by one-half of one percent (0.5%) per annum, such fee to be
payable quarterly in arrears on the first day of the calendar quarter
following the Closing Date and the first day of each calendar quarter
thereafter. The Revolving Commitment Fee provided in this subsection
1.9(b)(ii) shall accrue at all times from and after the Closing Date to
the Acquisition Termination Date.

10
17
(c) Letter of Credit Participation Fee. Borrower shall pay to
Agent, for the ratable benefit of the Lenders having Revolving Loan
Commitments, fees for each Lender Letter of Credit and each Letter of Credit
Participation Agreement (the "Letter of Credit Participation Fee") for the
period from and including the date of issuance of same to and excluding the
date of expiration or termination, equal to the average daily amount of Letter
of Credit Participation Liability multiplied by two and one-half of one percent
(2.50%) per annum; provided, however, at the Agent's or the Required Lenders'
option, while an Event of Default exists such percent shall be increased to
four and one-half of one percent (4.50%) per annum, such fees to be payable
quarterly in arrears on the first day of the calendar quarter following the
date hereof and the first day of each calendar quarter thereafter. The
Borrower shall also reimburse the Agent for any and all fees and expenses, if
any, paid by the Agent to the issuer of any letter of credit subject to a
Letter of Credit Participation Agreement.

1.10. Payments by the Borrower. (a) All payments (including
prepayments) to be made by the Borrower on account of principal, interest, fees
and other amounts required hereunder shall be made without set-off, recoupment
or counterclaim, shall, except as otherwise expressly provided herein, be made
to the Agent for the ratable account of the Lenders at the address for payment
specified in the signature page hereof in relation to the Agent (or such other
address as Agent may from time to time specify in accordance with Section 9.2),
and shall be made in dollars and in immediately available funds, no later than
11:00 a.m. (Chicago time) on the date due. The Agent will promptly distribute
to each Lender its Commitment Percentage (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 Agent later
than 11:00 a.m. (Chicago time) shall be deemed to have been received on the
immediately succeeding Business Day and any applicable interest or fee shall
continue to accrue. The Borrower hereby authorizes the Agent and each Lender
to make a Revolving Loan (which shall be a Base Rate Loan) to pay (i) interest,
principal, agent fees, Commitment Fees and Letter of Credit Participation Fees,
in each instance, on the date due, or (ii) after five (5) days prior notice to
Borrower, other fees, costs or expenses payable by the Borrower or any of its
Subsidiaries hereunder or under the other Loan Documents.

(b) Subject to the provisions set forth in the definition of
"Interest Period" herein, if any payment hereunder shall be stated to be due on
a day other than a Business Day, such payment shall be made on the next
succeeding 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.

1.11. Payments by the Lenders to the Agent. (a) Unless the Agent
shall have received notice from a Lender on the Closing Date or, with respect
to each Borrowing after the Closing Date, at least one Business Day prior to
the date of any proposed Borrowing, that such Lender will not make available to
the Agent as and when required hereunder for the account of the Borrower the
amount of that Lender's Commitment Percentage of the Borrowing, the Agent may
assume that each Lender has made such amount available to the Agent in
immediately available funds on the applicable Borrowing date and the Agent may
(but shall not be so required), in

11
18
reliance upon such assumption, make available to the Borrower on such date a
corresponding amount. If and to the extent any Lender shall not have made its
full amount available to the Agent in immediately available funds and the Agent
in such circumstances has made available to the Borrower such amount, that
Lender shall on the next Business Day following the date of such Borrowing make
such amount available to the Agent, together with interest at the Agent's cost
of funds for and determined as of each day during such period. A notice of the
Agent submitted to any Lender with respect to amounts owing under this
subsection 1.11(a) shall be conclusive, absent manifest error. If such amount
is so made available, such payment to the 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 Agent on the next Business Day following
the date of such Borrowing, the Agent shall notify the Borrower of such failure
to fund and, upon demand by the Agent, the Borrower shall pay such amount to
the Agent for the 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 date of
Borrowing shall not relieve any other Lender of any obligation hereunder to
make a Loan on the date of such Borrowing, 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 the date of any Borrowing. Without limiting the generality of the
foregoing, each Lender shall be obligated to fund its Commitment Percentage of
any Revolving Loan made after any acceleration of the Obligations with respect
to any draw on any Lender Letter of Credit or any payment made under any Letter
of Credit Participation Agreement.

1.12. Disbursements of Advances; Settlements Among Agent and Lenders;
Payments of Interest and Fees; Disgorgement Obligations. (a) The Revolving
Loan balance may fluctuate from day to day through the Agent's disbursement of
funds to, and receipt of funds from, the Borrower. In order to minimize the
frequency of transfers of funds between the Agent and each Lender, Revolving
Loan advances and payments will be settled according to the procedures
described in this Section 1.12. Notwithstanding these procedures, each
Lender's obligation to fund its portion of any advances made by the Agent to
the Borrower will commence on the date such advances are made by the Agent.
Such payments will be made by each Lender without setoff, counterclaim or
reduction of any kind.

(b) On the first Business Day of each week, or more frequently
(including daily) if the Agent so elects (each such day being a "Settlement
Date"), the Agent will advise each Lender by telephone or telecopy of the
amount of each such Lender's Commitment Percentage of the Revolving Loan
balance as of the close of business of the Business Day immediately preceding
the Settlement Date. In the event that payments are necessary to adjust the
amount of such Lender's share of the Revolving Loan balance to equal such
Lender's Commitment Percentage of the Revolving Loan Obligations as of any
Settlement Date, such Lender will pay to the Agent, or the Agent will pay to
such Lender (as applicable) the amount necessary in same day funds by

12
19
wire transfer to the other's account not later than 2:00 p.m. Chicago time on
the Business Day following the Settlement Date.

(c) Notwithstanding the foregoing and with respect to Borrowings
requiring notice in advance of the Borrowing date, the Agent, at its option,
may elect to require that each Lender provide funds in connection with any
requested Borrowing hereunder on the scheduled Borrowing date, and in such
event the Agent shall advise each Lender by telephone or telecopy of the amount
to be funded by such Lender no later than one (1) Business Day prior to the
Borrowing date applicable thereto, and each such Lender shall pay to the Agent
such Lender's Commitment Percentage of the Borrowing in same day funds by wire
transfer to the Agent's account not later than 10:30 a.m. Chicago time on such
Borrowing date.

(d) For purposes of this subsection 1.12(d), the following terms will
have the meanings indicated:

"Acquisition Commitment Fee Ratio" means a number calculated by
dividing the total amount of Acquisition Commitment Fees received by the
Agent during the immediately preceding calendar quarter by the total
amount of Acquisition Commitment Fees due from the Borrower during the
immediately preceding calendar quarter.

"Daily Loan Balance" means, as to any Lender and any particular
Loan, an amount calculated as of the end of each calendar day by
subtracting (i) the cumulative principal amount paid by the Agent to a
Lender on such Loan from and including the Closing Date through and
including such calendar day from (ii) the cumulative principal amount on
such Loan advanced by such Lender to the Agent on that Loan from and
including the Closing Date through and including such calendar day.

"Daily Interest Rate" means, as to any Loan, an amount calculated
by dividing the interest rate payable on such Loan, determined pursuant
to Section 1.3, as of each calendar day by three hundred and sixty
(360).

"Daily Interest Amount" means, as to any Loan, an amount
calculated by multiplying the Daily Loan Balance of a Loan by the Daily
Interest Rate applicable to such Loan.

"Interest Ratio" means, as to any Loan, a number calculated by
dividing the total amount of the interest on such Loan received by the
Agent during the immediately preceding calendar quarter by the total
amount of interest on that Loan due from the Borrower during the
immediately preceding calendar quarter.

"Letter of Credit Participation Fee Ratio" means a number
calculated by dividing the total amount of Letter of Credit
Participation Fees received by the Agent during the immediately
preceding calendar quarter by the total amount of Letter of Credit

13
20
Participation Fees due from the Borrower during the immediately
preceding calendar quarter.

"Revolving Commitment Fee Ratio" means a number calculated by
dividing the total amount of Revolving Commitment Fees received by the
Agent during the immediately preceding calendar quarter by the total
amount of Revolving Commitment Fees due from the Borrower during the
immediately preceding calendar quarter.

On the first Business Day of each calendar quarter (each, an "Interest
Settlement Date"), the Agent will advise each Lender by telephone or telecopy
of the amount of such Lender's Commitment Percentage of interest and fees on
each Loan as of the end of the last day of the immediately preceding calendar
quarter. Provided that such Lender has made all payments required to be made
by it under this Agreement, the Agent will pay to such Lender, by wire transfer
to such Lender's account (as specified by such Lender on the signature page of
this Agreement or the applicable Assignment and Acceptance) not later than 2:00
p.m. Chicago time on the next Business Day following the Interest Settlement
Date, such Lender's Commitment Percentage of:

(A) interest on each Loan in which such Lender has a
Commitment received by the Agent during the immediately preceding
calendar quarter, calculated by (1) adding together the Daily Interest
Amounts for each such Loan for each calendar day of the preceding
calendar quarter and (2) multiplying the total thereof by the Interest
Ratio for that Loan for such quarter; and

(B) Revolving Commitment Fees in respect of such Lender's
Commitment Percentage of the Revolving Loan received by the Agent during
the immediately preceding calendar quarter, calculated by (1)
multiplying the total amount of all Revolving Commitment Fees payable by
the Borrower for such calendar quarter by the Revolving Commitment Fee
Ratio for such calendar quarter, and (2) multiplying the result thereof
by the Lender's Commitment Percentage of the aggregate Revolving Loan
Commitment in effect during such immediately preceding calendar quarter;
and

(C) Acquisition Commitment Fees in respect of such Lender's
Commitment Percentage of the Acquisition Loan received by the Agent
during the immediately preceding calendar quarter, calculated by (1)
multiplying the total amount of all Acquisition Commitment Fees payable
by the Borrower for such calendar quarter by the Acquisition Commitment
Fee Ratio for such calendar quarter, and (2) multiplying the result
thereof by the Lender's Commitment Percentage of the aggregate
Acquisition Loan Commitment in effect during such immediately preceding
calendar quarter; and

(D) Letter of Credit Participation Fees in respect of such
Lender's Commitment Percentage of the Revolving Loan received by the
Agent during the immediately preceding calendar quarter, calculated by
(1) multiplying the total amount of all Letter of Credit Participation
Fees payable by the Borrower for such calendar month

14
21
by the Letter of Credit Participation Fee Ratio for such calendar
quarter, and (2) multiplying the result thereof by the Lender's
Commitment Percentage of the aggregate Revolving Loan Commitment in
effect during such immediately preceding calendar quarter.

(e) Unless the Agent shall have received notice from the Borrower
prior to the date on which any payment is due to the Lenders hereunder that the
Borrower will not make such payment in full as and when required hereunder, the
Agent may assume that the Borrower has made such payment in full to the Agent
on such date in immediately available funds and the Agent may (but shall not be
so required), in reliance upon such assumption, cause to be distributed to each
Lender on such due date an amount equal to the amount then due such Lender. If
the Agent pays an amount to a Lender under this Agreement in the belief or
expectation that a related payment has been or will be received by the Agent
from the Borrower and such related payment is not received by the Agent, the
Agent shall be entitled to recover such amount from such Lender, and each
Lender shall repay to the Agent on demand such amount, together with interest
thereon for each day from the date such amount is distributed to such Lender
until the date such Lender repays such amount to the Agent, at the Agent's cost
of funds, without setoff, counterclaim or deduction of any kind. If the Agent
determines at any time that any amount received by the Agent under this
Agreement must be returned to the Borrower or paid to any other Person pursuant
to any solvency, fraudulent conveyance or similar law or otherwise, then,
notwithstanding any other term or condition of this Agreement, the Agent will
not be required to distribute any portion of such payment to any Lender. In
addition, each Lender will repay to the Agent on demand any portion of such
amount that the Agent has distributed to such Lender, together with interest
thereon at such rate, if any, as the Agent is required to pay to the Borrower
or such other Person, without setoff, counterclaim or deduction of any kind.

ARTICLE II. - CONDITIONS PRECEDENT

2.1. Conditions of Initial Loans. The obligation of each Lender to
make its initial Loan and of the Agent to issue the initial Lender Letter of
Credit or Letter of Credit Participation Agreement hereunder is subject to the
condition that the Agent shall have received (or shall have waived receipt) on
or before the Closing Date all of the following, in form and substance
reasonably satisfactory to the Agent and (except for the Notes and any
instruments or documents which are Pledged Collateral) in sufficient
counterparts for each Lender, duly executed by all parties thereto:

(a) Credit Agreement and Notes. This Agreement executed by the
Borrower, the Agent and each of the Lenders, and the Notes executed by the
Borrower;

(b) Secretary's Certificates; Resolutions; Incumbency. A
certificate of the Secretary or Assistant Secretary of the Borrower and each
Subsidiary of the Borrower which is a party to any Loan Documents, certifying:

15
22
(i) the names and true signatures of the officers of the
Borrower and each such Subsidiary authorized to execute, deliver and
perform, as applicable, this Agreement, and all other Loan Documents to
be delivered hereunder; and

(ii) Copies of the resolutions of the board of directors of the
Borrower and each such Subsidiary approving and authorizing the
execution, delivery and performance by the Borrower or such Subsidiary
of this Agreement and the other Loan Documents to be executed or
delivered by it hereunder;

(i) the Organization Documents of the Borrower and each
Subsidiary of the Borrower which is party to any Loan Documents, as such
Organization Documents are in effect on the Closing Date, certified by
the Secretary of State (or similar, applicable Governmental Authority)
of the state of incorporation of the Borrower or such Subsidiary as of a
recent date, if and as applicable, all certified by the Secretary or
Assistant Secretary of the Borrower or such Subsidiary as of the Closing
Date; and

(ii) a good standing and, if available, tax good standing
certificate for the Borrower and each Subsidiary of the Borrower from
the Secretary of State (or similar, applicable Governmental Authority)
of its state of incorporation and each state where the Borrower or such
Subsidiary is qualified to do business as a foreign corporation as of a
recent date;

(d) Collateral Documents. The Collateral Documents, executed by
the Borrower and each Subsidiary of the Borrower, as applicable, in appropriate
form for recording, where necessary, together with:

(i) acknowledgment copies of all UCC-l financing statements
filed, registered or recorded to perfect the security interests of the
Agent, for the benefit of Agent and the Lenders, granted pursuant to the
Collateral Documents, or other evidence reasonably satisfactory to the
Agent that there has been (or will be, to the Agent's satisfaction)
filed, registered or recorded all financing statements and other
filings, registrations and recordings reasonably necessary and advisable
to perfect the Liens of the Agent, for the benefit of Agent and the
Lenders, granted pursuant to the Collateral Documents, in accordance
with applicable law;

(ii) uniform commercial code financing statement, federal and
state tax lien and judgment searches as the Agent shall have reasonably
requested of the Borrower and its Subsidiaries, and such termination
statements or other documents as may be reasonably necessary to confirm
that the Collateral is subject to no other Liens in favor of any Persons
(other than Permitted Liens);

16
23
(iii) all certificates and instruments representing the Pledged
Collateral, irrevocable proxies and stock transfer powers executed in
blank or other executed endorsements reasonably satisfactory to the
Agent;

(iv) evidence that all other actions reasonably necessary or,
in the reasonable opinion of the Agent, desirable to perfect and protect
the Liens created by the Collateral Documents have been taken;

(v) funds sufficient to pay any filing or recording tax or fee
in connection with any and all UCC-1 financing statements and, if
applicable, the Mortgages, all title insurance premiums, documentary
stamp or intangible taxes, recording fees and mortgage taxes payable in
connection with the recording of any mortgage or filing of any financing
statements or the issuance of the title insurance policies (whether due
on the Closing Date or in the future) including sums due in connection
with any future advances;

(vi) with respect to each parcel of real Property in respect of
which there is delivered a Mortgage and which is listed on Schedule 2.1,
an A.L.T.A. mortgagee policy of title insurance or a binder issued by a
title insurance company reasonably satisfactory to the Agent insuring
(or undertaking to insure, in the case of a binder) that the Mortgage
creates and constitutes a valid first Lien against such real Property in
favor of the Agent, for the benefit of Agent and the Lenders, subject
only to exceptions reasonably acceptable to the Agent, with such
endorsements and affirmative insurance as the Agent may reasonably
request;

(vii) if required by the Agent, flood insurance and earthquake
insurance on terms satisfactory to the Agent; and

(viii) such consents, estoppels, subordination agreements and
other documents and instruments executed by landlords, tenants and other
Persons party to material contracts relating to any Collateral as to
which the Agent shall be granted a Lien for the benefit of the Lenders,
as reasonably requested by the Agent;

(e) Legal Opinions. Such opinions of counsel to the Borrower and
its Subsidiaries, addressed to the Agent and the Lenders, in form and substance
reasonably satisfactory to Agent;

(f) Payment of Fees. The Borrower shall have paid all accrued and
unpaid fees, costs and expenses to the extent then due and payable on the
Closing Date, together with Attorney Costs of the Agent;

(g) Certificate. A certificate signed on behalf of Borrower by a
Responsible Officer, dated as of the Closing Date, stating that:

17
24
(i) the representations and warranties contained in Article
III hereof are true and correct in all material respects 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 initial Borrowing or issuance of the initial Lender Letter of Credit
or Letter of Credit Participation Agreement; and

(iii) there has occurred since December 31, 1997, no event or
circumstance that has resulted or could reasonably be expected to result
in a Material Adverse Effect;

(h) Financial Statements. Copies of all of the financial
statements of the Borrower and its Subsidiaries referred to in Section 3.11
together with a pro forma balance sheet giving effect to the transactions
contemplated hereby and by the Related Agreements, certified on behalf of
Borrower by a Responsible Officer;

(i) Insurance Policies. Standard lenders' loss payable
endorsements in favor of the Agent with respect to the insurance policies or
other instruments or documents evidencing insurance coverage on the properties
of the Borrower in accordance with Section 4.6 and endorsements to all
liability insurance policies naming the Agent and the Lenders as additional
insureds thereunder;

(j) Environmental Review. An environmental site assessment with
respect to any real Property owned or operated by Borrower or any of its
Subsidiaries, dated as of a recent date prior to the Closing Date or an earlier
date acceptable to the Agent, prepared by a qualified firm reasonably
acceptable to the Agent and the Lenders, stating, among other things, that such
real property is free from Hazardous Materials and that operations conducted
thereon are in compliance with all Environmental Laws and showing all costs
associated with performing work to remediate contamination thereat;

(k) Due Diligence. Evidence of completion to the satisfaction of
the Agent of such investigations, reviews and audits with respect to the
Borrower and the transactions contemplated by the Related Agreements as the
Agent or any Lender may deem appropriate;

(l) Accountants' Review. An accountants' review of the books and
records of the Borrower and its Subsidiaries prepared by a "Big Six" accounting
firm selected by the Agent, dated as of a recent date prior to the Closing Date
and otherwise in form and substance reasonably satisfactory to the Agent;

(m) Insurance Review. A review of the Borrower's insurance
coverages, prepared by a qualified firm reasonably acceptable to the Agent,
dated as of a recent date prior to the Closing Date and otherwise in form and
substance reasonably satisfactory to the Agent;

18
25
(n) Borrowing Base Certificate. A duly completed Borrowing Base
Certificate setting forth the Borrowing Base as of the Closing Date, giving pro
forma effect to the Related Transactions.

(o) Related Transactions. The Related Transactions shall have
closed in the manner contemplated by the Related Agreements and shall otherwise
be in form and substance reasonably satisfactory to the Agent;

(p) Prior Indebtedness. A payoff letter from each lender of any
Prior Indebtedness in form and substance reasonably satisfactory to the Agent,
together with such UCC-3 termination statements, releases of mortgage Liens and
other instruments, documents and/or agreements necessary or appropriate to
terminate any Liens in favor of such lender securing Prior Indebtedness which
is to be paid off on the Closing Date as the Agent may reasonably request, duly
executed and in form and substance reasonably satisfactory to the Agent; and

(q) Other Documents. Such other approvals, opinions, documents or
materials as the Agent may reasonably request.

2.2. Conditions to All Borrowings. The obligation of each Lender to
make any Loan and of the Agent to issue any Lender Letter of Credit or Letter
of Credit Participation Agreement, or to continue or convert any Loan
hereunder, is subject to the satisfaction of the following conditions precedent
on the relevant Borrowing or continuation or conversion date:

(a) Notice of Borrowing or Continuation/Conversion. The Agent
shall have received (with, in the case of the initial Loan only, a copy for
each Lender) a Notice of Borrowing or a Notice of Continuation/Conversion, as
applicable, in accordance with Section 1.5 or Section 1.6;

(b) Continuation of Representations and Warranties. The
representations and warranties made by the Borrower contained in Article III
shall be true and correct in all material respects on and as of such Borrowing,
or continuation or conversion date with the same effect as if made on and as of
such Borrowing or continuation or conversion date (except to the extent such
representations and warranties (i) expressly refer to an earlier date, in which
case they shall be true and correct in all material respects as of such earlier
date, or (ii) are not true and correct due to events or conditions, the
occurrence or existence of which are not prohibited by this Agreement or the
other Loan Documents and which do not, in and of themselves, constitute a
Default or an Event of Default);

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

(d) Borrowing Base Certificate. With respect to any Acquisition
Loan Borrowing, the Agent shall have received a duly completed Borrowing Base
Certificate setting forth availability under the Acquisition Loan facility as
of the date of such Borrowing and before giving effect to such Borrowing.
After giving effect to such Borrowing, the outstanding

19
26
principal balance of the Acquisition Loans shall not exceed the Maximum
Acquisition Loan Balance; and

(e) Subsidiaries. Borrower shall have pledged (or caused its
Subsidiaries to have pledged, if applicable) the stock or other equity interest
of each of its Subsidiaries to the Agent, for the benefit of Agent and the
Lenders, and shall have delivered, or caused to be delivered, to the Agent the
items described in subsection 2.1(d)(iii) and, to the extent not previously
delivered, the items described in subsections 2.1(b) and 2.1 (c), with respect
to each such Subsidiary. In addition, each such Subsidiary shall have
guaranteed the Obligations pursuant to the Guaranty and shall have granted to
the Agent, for the benefit of Agent and the Lenders, a security interest in all
of such Subsidiary's property to secure such guaranty.

Each Notice of Borrowing and Notice of Continuation/ Conversion submitted by
the Borrower hereunder shall constitute a representation and warranty by the
Borrower hereunder, as of the date of each such notice or application and as of
the date of each Borrowing or continuation or conversion, as applicable, that
the conditions in Section 2.2 are satisfied.

2.3. Additional Conditions to Acquisition Loans. The obligation of
each Lender to make any Acquisition Loan is subject to the satisfaction of the
following additional conditions precedent on the relevant Borrowing date:

(a) Evidence of Perfected First Priority Security Interest. With
respect to the Target acquired or financed with the proceeds of such
Acquisition Loan, and prior to or simultaneously with the funding of such
Acquisition Loan, the Agent shall have been granted, for the benefit of Agent
and the Lenders, a first priority lien on and security interest in the property
of such Target, subject only to Permitted Liens, and shall have received,
without limitation, (a) the items described in subsection 2.1(d)(ii) and
Section 4.12, and (b) duly executed UCC financing statements or amendments to
existing financing statements with respect to such Target, in form and
substance reasonably satisfactory to the Agent and which, upon filing, shall
perfect the first priority security interest of the Agent, for the benefit of
Agent and the Lenders, in such property. In the event real property is being
acquired in connection with such Acquisition, prior to or simultaneously with
the funding of such Acquisition Loan, the Agent shall have received (x) in the
case of owned real property being acquired, a fully executed Mortgage, in form
and substance reasonably satisfactory to the Agent together with, in the case
of owned real property having a fair market value of at least $1,000,000 (if
requested by the Agent), an ALTA lender's title insurance policy issued by a
title insurer reasonably satisfactory to the Agent, in form and substance and
in an amount reasonably satisfactory to the Agent insuring that the Mortgage is
a valid and enforceable first priority lien on the respective property, free
and clear of all defects, encumbrances and Liens except for Permitted Liens,
and (y) an environmental site assessment prepared by a qualified firm
reasonably acceptable to the Agent, in form and substance reasonably
satisfactory to the Agent.

(b) Approval. The Agent and the Majority Lenders shall have
approved such Acquisition in accordance with Section 5.16, if such approval is
necessary;

20
27
(c) Additional Documentation.

(i) The Agent shall have received complete executed or
conformed copies of each document, instrument and agreement executed in
connection with such Acquisition (collectively, "Acquisition
Documents"), all of which shall be subject to the Lenders' review and
the Agent's and the Majority Lenders' approval, if applicable; provided,
the Agent and the Lenders shall have no right to disapprove any
Acquisition Document to the extent the same is consistent with the
Agent's and the Majority Lenders' approval pursuant to Section 5.16;

(ii) such Acquisition Documents shall be in full force and
effect and no material term or condition thereof shall have been
amended, modified or waived after the execution thereof (other than in a
manner favorable to the Borrower or the Target or solely to extend the
date by which the Acquisition is required to occur) except with the
prior written consent of the Agent and the Majority Lenders, if
applicable;

(iii) in the case of an Acquisition requiring the consent of
Majority Lenders, none of the parties to any of such Acquisition
Documents shall have failed to perform any material obligation or
covenant required to be performed or complied with on or before the date
of such Borrowing; and

(iv) if requested by the Agent, the Agent shall have received
such opinions of counsel to the Borrower in respect of such Acquisition,
addressed to the Agent and the Lenders, in form and substance reasonably
satisfactory to the Agent.

ARTICLE III. - REPRESENTATIONS AND WARRANTIES

The Borrower represents and warrants to the Agent and each Lender that
the following are, and after giving effect to the Related Transactions will be,
true, correct and complete:

3.1. Corporate Existence and Power. The Borrower and each of its
Subsidiaries:

(a) is a corporation, limited liability company or limited
partnership, as applicable, duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation or formation,
as applicable;

(b) has the power and authority to own its assets, carry on its
business and execute, deliver, and perform its obligations under, the Loan
Documents and the Related Agreements to which it is a party;

(c) has all governmental licenses, authorizations, consents and
approvals to own its assets and carry on its business, and is duly qualified as
a foreign corporation, limited liability company or partnership, as applicable,
and licensed and in good standing, under the laws of each

21
28
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.

3.2. Corporate Authorization; No Contravention. (a) The execution,
delivery and performance by the Borrower of this Agreement, and the Borrower
and its Subsidiaries of any other Loan Document and Related Agreement to which
such Person is party, have been duly authorized by all necessary action, and do
not and will not:

(i) contravene the terms of any of that Person's Organization
Documents;

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

(iii) violate any material Requirement of Law in any material
respect.

(b) Schedule 3.2 sets forth the authorized equity securities of the
Borrower and its Subsidiaries. All issued and outstanding equity securities of
the Borrower and its Subsidiaries are duly authorized and validly issued, fully
paid, non-assessable, and free and clear of all Liens other than, with respect
to the equity securities of Subsidiaries of the Borrower, those in favor of
Agent, for the benefit of Agent and Lenders, and such securities were issued in
compliance with all applicable state and federal laws concerning the issuance
of securities. All of the issued and outstanding capital stock of each of the
Borrower's Subsidiaries is owned by the Borrower or a Wholly-Owned Subsidiary
of the Borrower, as set forth on Schedule 3.2. As of the Closing Date, all of
the issued and outstanding equity securities of the Borrower are owned by the
Persons and in the amounts set forth on Schedule 3.2. There are no pre-emptive
or other outstanding rights, options, warrants, conversion rights or other
similar agreements or understandings for the purchase or acquisition of any
shares of capital stock or other securities of any such entity except, in the
case of the Borrower, as set forth on Schedule 3.2. No shares of Disqualified
Stock are issued and outstanding.

3.3. Governmental Authorization. No approval, consent, exemption,
authorization, or other action by, or notice to, or filing with, any
Governmental Authority (collectively, "Approvals") is necessary or required in
connection with the execution, delivery or performance by, or enforcement
against, the Borrower or any of its Subsidiaries of this Agreement, any other
Loan Document or Related Agreement except (a) for recordings and filings in
connection with the Liens granted to the Agent under the Collateral Documents,
(b) those obtained or made on or

22
29
prior to the Closing Date and (c) in the case of any Related Agreement, those
which, if not obtained or made, could not reasonably be expected to have,
either individually or in the aggregate, a Material Adverse Effect. It is
understood that continued performance by the Borrower and its Subsidiaries of
this Agreement and the other Loan Documents to which such Persons are a party
will require various Approvals, such as filings related to environmental
matters, ERISA matters, taxes and intellectual property, filings required to
maintain corporate and similar standing and existence, filings pursuant to the
UCC and other security filings and recordings, filings required with the SEC,
routine filings in the ordinary course of business, and filings required in
connection with the exercise by the Lenders and the Agent of remedies in
connection with the Loan Documents as contemplated therein.

3.4. Binding Effect. This Agreement and each other Loan Document and
Related Agreement to which the Borrower or any of its Subsidiaries is a party
constitute the legal, valid and binding obligations of the Borrower and each
Subsidiary which 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.

3.5. Litigation. Except as specifically disclosed in Schedule 3.5,
there are no actions, suits, proceedings, claims or disputes pending, or to the
best knowledge of the Borrower, threatened or contemplated, at law, in equity,
in arbitration or before any Governmental Authority, against the Borrower, or
its Subsidiaries or any of their respective Properties which:

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

(b) if determined adversely to the Borrower or any of its
Subsidiaries, could reasonably be expected to result in equitable relief
or monetary judgment(s), individually or in the aggregate, in excess of
$500,000.

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, any other
Loan Document or any Related Agreement, or directing that the transactions
provided for herein or therein not be consummated as herein or therein
provided.

3.6. No Default. No Default or Event of Default exists or would
result from the incurring of any Obligations by the Borrower or the grant or
perfection of the Agent's Liens on the Collateral. Neither the Borrower nor
any of its Subsidiaries 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 Closing Date, create an
Event of Default under subsection 7.1(e).

23
30
3.7. ERISA Compliance. (a) Schedule 3.7 lists all Qualified Plans
and Multiemployer Plans. The Borrower and each of its Subsidiaries is in
compliance in all material respects with all requirements of each Plan, and
each Plan complies in all material respects, and is operated in compliance in
all material respects, with all applicable provisions of law. Borrower is not
aware, after due inquiry, of any item of non-compliance which could potentially
result in the loss of Plan qualification or tax-exempt status, or give rise to
a material excise tax or other penalty imposed by a Governmental Authority. No
material proceeding, claim, lawsuit and/or investigation is pending concerning
any Plan. All required contributions have been and will be made in accordance
with the provisions of each Qualified Plan and Multiemployer Plan, and with
respect to Borrower or any ERISA Affiliate, there are, have been and will be no
material Unfunded Pension Liabilities or Withdrawal Liabilities.

(b) No ERISA Event has occurred or is expected to occur with respect
to any Qualified Plan, Multiemployer Plan or Plan.

(c) Members of the Controlled Group currently comply and have
complied in all material respects with the notice and continuation coverage
requirements of Section 4980B of the Code.

3.8. Use of Proceeds; Margin Regulations. The proceeds of the Loans
are intended to be and shall be used solely for the purposes set forth in and
permitted by Section 4.10, and are intended to be and shall be used in
compliance with Section 5.8. Neither the Borrower nor any of its Subsidiaries
is generally engaged in the business of purchasing or selling Margin Stock or
extending credit for the purpose of purchasing or carrying Margin Stock.

3.9. Title to Properties. The Borrower and each of its Subsidiaries
have good 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 Permitted Liens. As of the Closing Date, the Property
of the Borrower and its Subsidiaries is subject to no Liens, other than
Permitted Liens. Schedule 3.9 lists all real property owned by the Borrower or
any of its Subsidiaries as of the Closing Date.

3.10. Taxes. The Borrower 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 in
good faith by appropriate proceedings diligently prosecuted and for which
adequate reserves have been provided in accordance with GAAP and no notice of
Lien has been filed or recorded. There is no proposed tax assessment against
the Borrower or any of its Subsidiaries which would, if the assessment were
made, have a Material Adverse Effect.

3.11. Financial Condition. (a) Each of (i) the audited consolidated
balance sheet of the Borrower and its Subsidiaries dated December 31, 1997, and
the related audited consolidated statements of income or operations,
shareholders' equity and cash flows for the fiscal year ended

24
31
on that date, (ii) the unaudited interim consolidated balance sheet of the
Borrower and its Subsidiaries dated February 28, 1998 and the related unaudited
consolidated statements of income, shareholders' equity and cash flows for the
two months then ended, (iii) the audited balance sheet of Reddy Ice Corporation
dated December 31, 1997 and the related unaudited statements of income or
operations, shareholders' equity and cash flow for the fiscal year ended on
that date and (iv) the unaudited interim balance sheet of Reddy Ice Corporation
dated March 31, 1998 and the related unaudited statements of income,
shareholders' equity and cash flows for the three months then ended:

(x) were prepared in accordance with GAAP consistently applied
throughout the respective periods covered thereby, except as otherwise
expressly noted therein, subject to, in the case of the unaudited and/or
interim financial statements, normal year-end adjustments and/or the
lack of footnote disclosures; and

(y) present fairly in all material respects the consolidated
financial condition of such Persons as of the dates thereof and results
of operations for the periods covered thereby.

(b) Since December 31, 1997, there has been no Material Adverse
Effect.

(c) The Borrower and its Subsidiaries have no Indebtedness other than
Indebtedness permitted pursuant to Section 5.5 and have no Contingent
Obligations other than Contingent Obligations permitted pursuant to Section
5.9.

3.12. Environmental Matters. (a) The on-going operations of the
Borrower and each of its Subsidiaries comply in all respects with all
Environmental Laws, except such non-compliance which could not (if enforced in
accordance with applicable law) reasonably be expected to result in a Material
Adverse Effect.

(b) The Borrower 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 Borrower and each of its Subsidiaries are in compliance with
all material terms and conditions of such Environmental Permits, except where
the failure to obtain or to be in compliance with such Environmental Permits
could not reasonably be expected to result in a Material Adverse Effect.

(c) None of the Borrower, 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
any judicial or docketed administrative proceeding, respecting 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, or arising from operations
prior to the Closing Date, of the

25
32
Borrower or any of its Subsidiaries that would reasonably be expected to result
in a Material Adverse Effect. In addition, neither the Borrower nor any of its
Subsidiaries has any underground storage tanks (i) that are not properly
registered or permitted under applicable Environmental Laws, or (ii) that are
leaking or disposing of Hazardous Materials, and that, in either case, would
reasonably be expected to result in a Material Adverse Effect.

3.13. Collateral Documents. All representations and warranties of
the Borrower, any of its Subsidiaries or any other party to any Collateral
Document (other than the Agent and/or any Lender) contained in the Collateral
Documents are true and correct in all material respects.

3.14. Regulated Entities. None of the Borrower, any Person
controlling the Borrower, or any Subsidiary of the Borrower, is (a) an
"investment company" within the meaning of the Investment Company Act of 1940;
or (b) 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.

3.15. Solvency. The Borrower and its Subsidiaries, on a consolidated
basis, are, Solvent.

3.16. Labor Relations. There are no strikes, lockouts or other labor
disputes against the Borrower or any of its Subsidiaries, or to the best of the
Borrower's knowledge, threatened against or affecting the Borrower or any of
its Subsidiaries, in any case which would reasonably be expected to have a
Material Adverse Effect and no significant unfair labor practice complaint is
pending against the Borrower or any of its Subsidiaries or, to the best
knowledge of the Borrower, threatened against any of them before any
Governmental Authority in any case which could reasonably be expected to have a
Material Adverse Effect.

3.17. Copyrights, Patents, Trademarks and Licenses, etc. Schedule
3.17 identifies all United States and foreign patents, trademarks, service
marks, trade names and copyrights, and all registrations and applications for
registration thereof and all licenses thereof, owned or held by Borrower or any
of its Subsidiaries on the Closing Date after giving effect to the Related
Transactions, and identifies the jurisdictions in which such registrations and
applications have been filed. Except as otherwise disclosed in Schedule 3.17,
as of the Closing Date, Borrower and its Subsidiaries are the sole beneficial
owners of, or have the right to use, free from any restrictions, claims, rights
encumbrances or burdens, the intellectual property identified on Schedule 3.17
and all other processes, designs, formulas, computer programs, computer
software packages, trade secrets, inventions, product manufacturing
instructions, technology, research and development, know-how and all other
intellectual property that are necessary for the operation of Borrower's and
its Subsidiaries' businesses as being operated on the Closing Date after giving
effect to the Related Transactions. Each patent, trademark, service ▇▇▇▇,
trade name, copyright and license listed on Schedule 3.17 is in full force and
effect except to the extent the failure to be in effect will not and could not
reasonably be expected to have a Material Adverse Effect. Except as set forth
in Schedule 3.17, to the best knowledge of Borrower, as of the Closing Date

26
33
(a) none of the present or contemplated products or operations of Borrowers or
its Subsidiaries infringes any patent, trademark, service ▇▇▇▇, trade name,
copyright, license of intellectual property or other right owned by any other
Person, and (b) there is no pending or threatened claim or litigation against
or affecting Borrower or any of its Subsidiaries contesting the right of any of
them to manufacture, process, sell or use any such product or to engage in any
such operation except for claims and/or litigation which will not and could not
reasonably be expected to have a Material Adverse Effect.

None of the trademark registrations set forth on Schedule 3.17 is an
"intent to use" registration.

3.18. Subsidiaries. The Borrower has no Subsidiaries or equity
investments in any other corporation or entity other than those specifically
disclosed in Schedule 3.2.

3.19. Brokers' Fees; Transaction Fees. Except as set forth in
Schedule 3.19, neither the Borrower nor any of its Subsidiaries has any
obligation to any Person in respect of any finder's, broker's or investment
banker's fee in connection with the transactions contemplated hereby. The fees
set forth on Schedule 3.19 will be the responsibility of, and paid on the
Closing Date by, the Persons indicated in said Schedule.

3.20. Insurance. The Properties of the Borrower and its Subsidiaries
are insured with financially sound and reputable insurance companies which are
not Affiliates of the Borrower, in such amounts, with such deductibles and
covering such risks as are customarily carried by companies engaged in similar
businesses and owning similar Properties in localities where the Borrower or
such Subsidiary operates. A true and complete listing of such insurance,
including issuers, coverages and deductibles, has been provided to the Agent.

3.21. Full Disclosure. None of the representations or warranties
made by the Borrower or any of its Subsidiaries in the Loan Documents as of the
date such representations and warranties are made or deemed made, and none of
the statements contained in each exhibit, report, statement or certificate
furnished by or on behalf of the Borrower or any of its Subsidiaries in
connection with the Loan Documents (including the offering and disclosure
materials, if any, delivered by or on behalf of the Borrower to the Lenders
prior to the Closing 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 IV. - AFFIRMATIVE COVENANTS

The Borrower covenants and agrees that, so long as any Lender shall have
any Commitment hereunder, or any Loan or other Obligation (other than
contingent indemnification Obligations to the extent no claim giving rise
thereto has been asserted) shall remain unpaid or unsatisfied, unless the
Required Lenders waive compliance in writing:

27
34
4.1. Financial Statements. The Borrower shall maintain, and shall
cause each of its Subsidiaries to maintain, a system of accounting established
and administered in accordance with sound business practices to permit the
preparation of financial statements in conformity with GAAP (provided that
monthly financial statements shall not be required to have footnote disclosure
and are subject to normal year-end adjustments). The Borrower shall deliver to
the Agent and each Lender in form and detail reasonably satisfactory to the
Agent and the Required Lenders:

(a) as soon as available, but not later than ninety (90) days after
the end of each fiscal year, a copy of the audited consolidated balance sheet
of the Borrower as at the end of such year and the related consolidated
statements of income or operations, shareholders' equity and cash flows for
such fiscal year, setting forth in each case in comparative form the figures
for the previous fiscal year, and accompanied by the opinion of any
nationally-recognized independent public accounting firm reasonably acceptable
to the Agent which report shall state that such consolidated financial
statements present fairly in all material respects 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 such accountant of any material portion of
the Borrower's or any Subsidiary's records;

(b) as soon as available, but not later than forty-five (45) days
after the end of each fiscal month of each year, a copy of the unaudited
consolidated and consolidating balance sheets of the Borrower and each of its
Subsidiaries, and the related consolidated and consolidating statements of
income, shareholders' equity and cash flows as of the end of such month and for
the portion of the fiscal year then ended, all certified on behalf of the
Borrower by a Responsible Officer as fairly presenting in all material respects
the financial position and the results of operations of the Borrower and the
Subsidiaries in accordance with GAAP, subject to normal year-end adjustments
and absence of footnote disclosure; and

(c) as soon as available, but not later than forty-five (45) days
after the end of each fiscal quarter of each year, a financial summary and
leverage calculation on the form heretofore delivered by Agent to the Borrower,
all certified on behalf of the Borrower by a Responsible Officer.

(d) concurrently with the delivery of the financial statements
pursuant to subsection 4.1(b), a copy of unaudited statements of income and
cash flow as of the end of such month and for the portion of the fiscal year
then ended, on an Acquisition by Acquisition basis (with respect to
Acquisitions consummated on or within twelve months prior to the Closing Date
and after the Closing Date, but only for the first twelve (12) months after the
closing of such Acquisition), all certified by the Borrower pursuant to a
certificate executed on its behalf by a Responsible Officer as fairly
presenting in all material respects the results of operations of the Target
acquired in each such Acquisition in accordance with GAAP, subject to normal
year-end adjustments and absence of footnote disclosure.

28
35
4.2. Certificates; Borrowing Base Certificates; Other Information. The
Borrower shall furnish to the Agent and each Lender:

(a) concurrently with the delivery of the annual financial statements
referred to in subsection 4.1(a) above, a certificate of the independent
certified public accountants reporting on such financial statements stating
that in making the examination necessary therefor no knowledge was obtained of
any Default or Event of Default, except as specified in such certificate;

(b) concurrently with the delivery of the financial statements
referred to in subsections 4.1(a) and, with respect to the last month of each
fiscal quarter, 4.1(b) above, a fully and properly completed Compliance
Certificate in the form of Exhibit 4.2(b), certified on behalf of the Borrower
by a Responsible Officer;

(c) promptly after the same are sent, copies of all financial
statements and reports which the Borrower sends to its shareholders generally;
and promptly after the same are filed, copies of all financial statements and
regular, periodic or special reports which the Borrower may make to, or file
with, the Securities and Exchange Commission or any successor or similar
Governmental Authority;

(d) concurrently with (i) the delivery of the financial statements
pursuant to subsection 4.1(b) and (ii) each Acquisition Loan Borrowing, a
Borrowing Base Certificate certified by the Borrower and executed on its behalf
by a Responsible Officer, setting forth the Borrowing Base as at the end of the
most-recently ended fiscal month, in the case of clause (i) above, and as at
the date of the applicable Acquisition Loan Borrowing, in the case of clause
(ii) above;

(e) together with each delivery of financial statements pursuant to
subsection 4.1(a) and (b) (i) to the extent prepared by Borrower or its
management, a management report, in reasonable detail, signed by the chief
financial officer of the Borrower, describing the operations and financial
condition of the Borrower and its Subsidiaries for the month and the portion of
the fiscal year then ended (or for the fiscal year then ended in the case of
annual financial statements), and (ii) a report setting forth in comparative
form the corresponding figures for the corresponding periods of the previous
fiscal year and the corresponding figures from the most recent projections for
the current fiscal year delivered pursuant to subsection 4.2(f) and discussing
the reasons for any significant variations;

(f) as soon as available and in any event no later than the last day
of each fiscal year of the Borrower, projections of the Borrower's (and its
Subsidiaries') consolidated and consolidating financial performance for the
forthcoming three fiscal years on a year by year basis, and for the forthcoming
fiscal year on a month by month basis;

(g) annually, concurrently with the Borrower's delivery of the
projections under subsection 4.2(f), the Borrower shall supplement in writing
and deliver to the Agent revisions of

29
36
and supplements to the Schedules hereto related to Article III hereof to the
extent necessary to disclose new or changed facts or circumstances after the
Closing Date; provided that delivery or receipt of such subsequent disclosure
shall not constitute a waiver by the Agent or any Lender or a cure of any
Default or Event of Default resulting in connection with the matters disclosed;

(h) promptly upon receipt thereof, copies of any reports submitted by
the Borrower's certified public accountants in connection with each annual,
interim or special audit or review of any type of the financial statements or
internal control systems of the Borrower made by such accountants, including
any comment letters submitted by such accountants to management of the Borrower
in connection with their services;

(i) at any time if a Default or an Event of Default shall have
occurred and be continuing, the Agent may, or may require the Borrower to, at
the Borrower's expense, obtain appraisals in form and substance and from
appraisers reasonably satisfactory to the Agent stating the then current fair
market value of all or any portion of the real or personal property of the
Borrower or any of its Subsidiaries; and

(j) promptly, such additional business, financial, corporate affairs
and other information as the Agent may from time to time reasonably request.

4.3. Notices. The Borrower shall promptly notify the Agent and each
Lender of any of the following, promptly (and in no event later than three (3)
Business Days after a Responsible Officer becoming aware thereof):

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

(b) any breach or non-performance of, or any default under, any
Contractual Obligation of the Borrower or any of its Subsidiaries, or any
violation of, or non-compliance with, any Requirement of Law, which could
reasonably be expected to result, either individually or in the aggregate, in a
Material Adverse Effect, including a description of such breach, non-
performance, default, violation or non-compliance and the steps, if any, the
Borrower or such Subsidiary has taken, is taking or proposes to take in respect
thereof;

(c) any dispute, litigation, investigation, proceeding or suspension
which may exist at any time between the Borrower or any of its Subsidiaries and
any Governmental Authority which could reasonably be expected to result, either
individually or in the aggregate, in a Material Adverse Effect;

(d) the commencement of, or any material development in, any
litigation or proceeding affecting the Borrower or any Subsidiary (i) in which
the amount of damages claimed is $500,000 (or its equivalent in another
currency or currencies) or more, (ii) in which injunctive or similar relief is
sought and which would reasonably be expected to be adversely determined and,
if so determined, would reasonably be expected to have a Material Adverse
Effect, or (iii) in

30
37
which the relief sought is an injunction or other stay of the performance of
this Agreement, any Loan Document or any Related Agreement;

(e) any of the following if the same could reasonably be expected to
have a Material Adverse Effect: (i) any enforcement, cleanup, removal or other
governmental or regulatory actions instituted, completed or threatened against
the Borrower or any of its Subsidiaries or any of their respective Properties
pursuant to any applicable Environmental Laws, (ii) any other Environmental
Claims, and (iii) any environmental or similar condition on any real property
adjoining the property of the Borrower or any Subsidiary that could reasonably
be anticipated to cause Borrower's or any of its Subsidiaries' property 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;

(f) any of the following if the same could reasonably be expected to
have a Material Adverse Effect, together with a copy of any notice with respect
to such event that may be required to be filed with a Governmental Authority
and any notice delivered by a Governmental Authority to the Borrower or any
member or its Controlled Group with respect to such event:

(i) an ERISA Event;

(ii) the adoption of any new Qualified Plan that is subject to
Title IV of ERISA or Section 412 of the Code by any member of the
Controlled Group;

(iii) the adoption of any amendment to a Qualified Plan that is
subject to Title IV of ERISA or Section 412 of the Code, if such
amendment results in a material increase in benefits or unfunded
liabilities; or

(iv) the commencement of contributions by any member of the
Controlled Group to any Qualified Plan that is subject to Title IV of
ERISA or Section 412 of the Code;

(g) any Material Adverse Effect subsequent to the date of the most
recent audited financial statements of the Borrower delivered to the Lenders
pursuant to this Agreement;

(h) any material change in accounting policies or financial reporting
practices by the Borrower or any of its Subsidiaries;

(i) any labor controversy resulting in or threatening to result in
any strike, work stoppage, boycott, shutdown or other labor disruption against
or involving the Borrower or any of its Subsidiaries if the same could
reasonably be expected to have a Material Adverse Effect; and

(j) the creation, establishment or acquisition of any Subsidiary.

Each notice pursuant to this Section shall be accompanied by a written
statement by a Responsible Officer on behalf of Borrower setting forth details
of the occurrence referred to

31
38
therein, and stating what action the Borrower proposes to take with respect
thereto and at what time. Each notice under subsection 4.3(a) shall describe
with particularity any and all clauses or provisions of this Agreement or other
Loan Document that have been breached or violated.

4.4. Preservation of Corporate Existence, Etc. The Borrower shall,
and shall cause each of its Subsidiaries 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 except, with respect to Subsidiaries, in connection with
transactions permitted by Section 5.3;

(b) preserve and maintain in full force and effect all rights,
privileges, qualifications, permits, licenses and franchises necessary in the
normal conduct of its business except in connection with transactions permitted
by Section 5.3 and sales of assets permitted by Section 5.2 and except as could
not reasonably be expected to have a Material Adverse Effect;

(c) use its reasonable efforts, in the Ordinary Course of Business,
to preserve its business organization and preserve the goodwill and business of
the customers, suppliers and others having material business relations with it,
the non-preservation of which could reasonably be expected to have a Material
Adverse Effect; and

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

4.5. Maintenance of Property. The Borrower shall maintain, and shall
cause each of its Subsidiaries 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 except where the failure to do so could not reasonably be
expected to have a Material Adverse Effect.

4.6. Insurance. The Borrower shall maintain, and shall cause each of
its Subsidiaries 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,
which amounts shall not be reduced by the Borrower or any of its Subsidiaries
in the absence of thirty (30) days' prior notice to the Agent and business
interruption insurance in an amount not less than $2,500,000. All property
damage and casualty insurance shall name the Agent as loss payee/mortgagee, all
liability insurance shall name the Agent and the Lenders as additional insureds
and all business interruption insurance shall name the Agent as assignee. Upon
request of the Agent or any Lender, the Borrower shall furnish the Agent, with
sufficient copies for each Lender, at reasonable intervals (but not more than
once per calendar year) a certificate of a Responsible Officer on behalf of the
Borrower (and, if requested by the Agent, any insurance

32
39
broker of the Borrower) setting forth the nature and extent of all insurance
maintained by the Borrower and its Subsidiaries in accordance with this Section
4.6. Unless the Borrower provides the Agent with evidence of the insurance
coverage required by this Agreement within thirty (30) days' following the
Agent's request of such evidence, or if the Agent has a reasonable basis to
believe such insurance is not in effect or will be cancelled without action by
the Borrower to prevent such cancellation, the Agent may purchase insurance at
the Borrower's expense to protect the Agent's and the Lenders' interests in the
Borrower's and its Subsidiaries' properties. This insurance may, but need not,
protect the Borrower's and its Subsidiaries' interests. The coverage that the
Agent purchases may not pay any claim that the Borrower or any Subsidiary makes
or any claim that is made against the Borrower or any Subsidiary in connection
with said property. The Borrower may later cancel any insurance purchased by
the Agent, but only after providing the Agent with evidence that the Borrower
has obtained insurance as required by this Agreement. If the Agent purchases
insurance, the Borrower will be responsible for the costs of that insurance,
including interest and any other charges the Agent may impose in connection
with the placement of insurance, until the effective date of the cancellation
or expiration of the insurance. The costs of the insurance may be added to the
Obligations. The costs of the insurance may be more than the cost of insurance
the Borrower may be able to obtain on its own.

4.7. Payment of Obligations. The Borrower shall, and shall cause its
Subsidiaries to, pay, discharge and perform as the same shall become due and
payable or required to be performed, 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 diligently prosecuted which stay the
enforcement of any Lien and for which adequate reserves in accordance with GAAP
are being maintained by the Borrower or such Subsidiary;

(b) all lawful claims which, if unpaid, would by law become a Lien
upon its Property unless the same are being contested in good faith by
appropriate proceedings diligently prosecuted which stay the imposition or
enforcement of the Lien and for which adequate reserves in accordance with GAAP
are being maintained by Borrower;

(c) all Indebtedness, as and when due and payable, but subject to any
subordination provisions contained herein and/or in any instrument or agreement
evidencing such Indebtedness; and

(d) the performance of all obligations under any Contractual
Obligation to which Borrower or any of its Subsidiaries is bound, or to which
it or any of its properties is subject, including the Related Agreements,
except where the failure to perform would not reasonably be expected to have a
Material Adverse Effect.

4.8. Compliance with Laws. The Borrower shall comply, and shall
cause each of its Subsidiaries to comply, in all material respects, with all
Requirements of Law of any Governmental Authority having jurisdiction over it
or its business (including, without limitation,

33
40
all Environmental Laws), except (a) such as may be contested in good faith by
appropriate proceedings diligently prosecuted without risk of loss of any
Collateral, (b) as to which a bona fide dispute exists, (c) for which
appropriate reserves have been established on the Borrower's financial
statements and (d) where the failure to comply could not reasonably be expected
to have, either individually or in the aggregate, a Material Adverse Effect.

Upon the written request of the Agent or any Lender, the Borrower shall
submit and cause each of its Subsidiaries to submit, to the Agent with
sufficient copies for each Lender, at the Borrower'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 Section 4.3, that
could, individually or in the aggregate, result in liability in excess of
$1,000,000.

4.9. Inspection of Property and Books and Records. The Borrower
shall maintain and shall cause each of its Subsidiaries 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 Borrower and
such Subsidiaries. The Borrower shall permit, and shall cause each of its
Subsidiaries to permit, representatives and independent contractors of the
Agent (at the expense of the Borrower not to exceed one (1) time per year
unless an Event of Default has occurred and is continuing), or any Lender (at
such Lender's expense unless an Event of Default shall have occurred and be
continuing), 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, at such reasonable times during normal business
hours and as often as may be reasonably desired, upon reasonable advance notice
to the Borrower; provided, however, when an Event of Default exists the Agent
or any Lender may do any of the foregoing at the expense of the Borrower at any
time during normal business hours and without advance notice.

4.10. Use of Proceeds. The Borrower shall use the proceeds of (i)
the initial Acquisition Loan funded on the Closing Date solely to finance the
consummation of the Related Transactions on the Closing Date, the refinancing
of the Prior Indebtedness and the payment of fees and expenses in connection
with the foregoing, (ii) the Acquisition Loans funded after the Closing Date
solely to finance the purchase price of any Acquisition permitted hereunder
(including the repayment of prior Indebtedness of the Target in connection
therewith) and the payment of fees and expenses in connection with such
Acquisition and (iii) the Revolving Loans funded after the Closing Date solely
for working capital and other general corporate purposes not in contravention
of any Requirement of Law and not in violation of this Agreement (but excluding
any purpose set forth in clause (ii) above).

4.11. Solvency. The Borrower and its Subsidiaries, on a consolidated
basis, shall at all times be Solvent.

34
41
4.12. Further Assurances. (a) The Borrower 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, the Borrower shall (and shall
cause any of its Subsidiaries to) take such additional actions as the Agent 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, (ii) to subject to
the Liens created by any of the Collateral Documents any of the Properties,
rights or interests covered by any of the Collateral Documents, (iii) to
perfect and maintain the validity, effectiveness and priority of any of the
Collateral Documents and the Liens intended to be created thereby, and (iv) 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 Agent and the Lenders under any Loan Document or under any other
document executed in connection therewith. Without limiting the generality of
the foregoing and except as otherwise approved in writing by the Required
Lenders, the Borrower shall cause each of its Subsidiaries to guaranty the
Obligations pursuant to the Guarantee and to grant to the Agent, for the
benefit of the Agent and the Lenders, a security interest in all of such
Subsidiary's property to secure such guaranty. Furthermore and except as
otherwise approved in writing by the Lenders, pursuant to the Pledge Agreement
(or, in the case of a Subsidiary of the Borrower which is the direct parent of
a Subsidiary, pursuant to a pledge agreement substantially in the form of the
Pledge Agreement) the Borrower (or such parent Subsidiary) shall pledge the
stock or other equity interest of each of its Subsidiaries to the Agent, for
the benefit of the Agent and the Lenders, to secure the Obligations. In
connection with each pledge of stock or other equity interests, the Borrower
shall deliver, or cause to be delivered, to Agent, the items described in
subsection 2.1(d)(iii), if applicable.

ARTICLE V. - NEGATIVE COVENANTS

The Borrower hereby covenants and agrees that, so long as any Lender
shall have any Commitment hereunder, or any Loan or other Obligation (other
than contingent indemnification Obligations to the extent no claim giving rise
thereto has been asserted) shall remain unpaid or unsatisfied, unless the
Required Lenders waive compliance in writing:

5.1. Limitation on Liens. The Borrower shall not, and shall not
suffer or permit any of its Subsidiaries 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 the Property of the Borrower or its
Subsidiaries on the Closing Date and set forth in Schedule 5.1 securing
Indebtedness outstanding on such date and

35
42
permitted by subsection 5.5(c), including replacement Liens on the Property
currently subject to such Liens;

(b) any Lien created under any Loan Document;

(c) Liens for taxes, fees, assessments or other governmental charges
(i) which are not delinquent or remain payable without penalty, or (ii) the
non-payment thereof is permitted by Section 4.7, provided that, in respect of
this clause (ii), all such Liens secure claims in the aggregate at any time
outstanding for Borrower and its Subsidiaries not exceeding $2,500,000;

(d) statutory Liens of carriers, warehousemen, mechanics, landlords,
materialmen or repairmen or other similar Liens arising in the Ordinary Course
of Business (and contractual landlords Liens, to the extent granted under any
lease entered into in the Ordinary Course of Business prior to the Closing Date
and so long as such Liens remain unperfected) which are not delinquent for more
than ninety (90) days or remain payable without penalty or which are being
contested in good faith and by appropriate proceedings diligently prosecuted,
which proceedings have the effect of preventing the forfeiture or sale of the
Property subject thereto and for which adequate reserves in accordance with
GAAP are being maintained;

(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 or to secure the performance of tenders, statutory obligations,
surety, stay, customs and appeals bonds, bids, leases, governmental contract,
trade contracts, performance and return of money bonds and other similar
obligations (exclusive of obligations for the payment of borrowed money) or to
secure liability to insurance carriers;

(f) Liens consisting of judgment or judicial attachment liens,
provided that the enforcement of such Liens is effectively stayed and all such
Liens secure claims in the aggregate at any time outstanding for the Borrower
and its Subsidiaries do not exceed $1,000,000;

(g) easements, rights-of-way, zoning and other restrictions, minor
defects or other irregularities in title, 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 based upon its present use or interfere
in any material respect with the ordinary conduct of the businesses of the
Borrower and its Subsidiaries;

(h) Liens on any Property acquired or held by the Borrower or its
Subsidiaries in the Ordinary Course of Business, securing Indebtedness incurred
or assumed for the purpose of financing (or refinancing) all or any part of the
cost of acquiring such Property and permitted under subsection 5.5(d); provided
that (i) any such Lien attaches to such Property concurrently with or within
twenty (20) days after the acquisition thereof, (ii) such Lien attaches solely
to the Property so acquired in such transaction (and improvements, additions
and accessions thereto)

36
43
and proceeds therefrom, and (iii) the principal amount of the debt secured
thereby does not exceed 100% of the cost of such Property;

(i) Liens securing Capital Lease Obligations permitted under
subsection 5.5(d);

(j) any interest or title of a lessor or sublessor under any lease
permitted by this Agreement;

(k) Liens arising from precautionary UCC financing statements filed
under any lease permitted by this Agreement; and

(l) banker's liens in favor of any bank at which the Borrower or any
of its Subsidiaries maintain deposit accounts to the extent relating to
customary fees and expenses of such bank incurred in connection with the
maintenance of deposit accounts in the Ordinary Course of Business;

(m) Liens securing obligations under or in respect of Rate Contracts
permitted under subsection 5.9(b); and

(n) Liens consented to by the Agent and the Majority Lenders in
connection with Acquisitions permitted hereunder.

5.2. Disposition of Assets. The Borrower shall not, and shall not
suffer or permit any of its Subsidiaries to, directly or indirectly, 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) 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) dispositions not otherwise permitted hereunder which are made for
fair market value and, to the extent required by Section 1.8, the mandatory
prepayment in the amount of the Net Proceeds of such disposition is made as
provided in Section 1.8; provided, that (i) at the time of any disposition, no
Event of Default shall exist or shall result from such disposition, (ii) the
aggregate sales price from such disposition shall be paid in cash or in
productive assets of a kind used or useable in the business of Borrower, and
(iii) the aggregate value of all assets so sold by the Borrower and its
Subsidiaries, together, shall not exceed in any fiscal year $5,000,000 and;
(iv) after giving effect to such disposition, Borrower is in compliance on a
pro forma basis with the covenants set forth in Article 6, recomputed for the
most recent month for which financial statements have been delivered; and

37
44
5.3. Consolidations and Mergers. The Borrower shall not, and shall
not suffer or permit any of its Subsidiaries to, merge, consolidate with or
into, or convey, transfer, lease or otherwise 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 that (i) upon not less than one (1) Business Day's prior written notice
to Agent, any Subsidiary of the Borrower may merge with, or dissolve or
liquidate into, a Wholly-Owned Subsidiary of Borrower, provided that such
Wholly-Owned Subsidiary shall be the continuing or surviving corporation;
provided, further that no Subsidiary of the Borrower shall merge with Southco,
Inc., and neither the Borrower nor any Subsidiary of the Borrower shall convey
any of its assets to Southco, Inc., until such time as all of the capital stock
of Southco, Inc. is pledged to the Agent and the certificates evidencing such
shares are delivered to the Agent and (ii) Acquisitions may be consummated in
accordance with Section 5.16.

5.4. Loans and Investments. The Borrower shall not and shall not
suffer or permit any of its Subsidiaries to (i) 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, including the
establishment or creation of a Subsidiary, or (ii) make or commit to make any
Acquisitions, or any other acquisition of all or substantially all of the
assets of another Person, or of any business or division of any Person,
including without limitation, by way of merger, consolidation or other
combination or (iii) 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 Borrower (the items described in clauses (i),
(ii) and (iii) are referred to as "Investments"), except for:

(a) Investments in cash and Cash Equivalents;

(b) extensions of credit by the Borrower to any of its Wholly-Owned
Subsidiaries provided the obligations of each obligor shall be evidenced by
notes, which notes shall be pledged to Agent, for the benefit of Agent and
Lenders, and have such other terms as Agent may reasonably require;

(d) loans and advances to employees in the ordinary course of
business not to exceed $1,000,000 in the aggregate at any time outstanding;

(e) Rate Contracts permitted under subsection 5.9(b); and

(f) Acquisitions permitted under Section 5.16.

5.5. Limitation on Indebtedness. The Borrower shall not, and shall
not suffer or permit any of its Subsidiaries to, create, incur, assume, suffer
to exist, or otherwise become or remain directly or indirectly liable with
respect to, any Indebtedness, except:

38
45
(a) Indebtedness incurred pursuant to this Agreement;

(b) Indebtedness consisting of Contingent Obligations described in
clause (i) of the definition thereof and permitted pursuant to Section 5.9;

(c) Indebtedness existing on the Closing Date and set forth in
Schedule 5.5 including extensions and refinancings thereof which do not
increase the principal amount of such Indebtedness as of the date of such
extension or refinancing;

(d) Indebtedness not to exceed $1,000,000 in the aggregate at any
time outstanding, consisting of Capital Lease Obligations or secured by Liens
permitted by subsection 5.1(h) and including refinancings and extensions
thereof which do not increase the principal amount of such Indebtedness as of
the date of such extension or refinancing and which are otherwise on terms and
conditions that taken as a whole are no less favorable to the Borrower or any
of its Subsidiaries than the terms of the Indebtedness being extended or
refinanced;

(e) unsecured intercompany Indebtedness permitted pursuant to
subsection 5.4(b);

(f) Indebtedness evidenced by the Senior Notes in an aggregate
principal amount not to exceed $270,000,000;

(g) other unsecured Indebtedness not exceeding in the aggregate at
any time outstanding $10,000,000; and

(h) Indebtedness disclosed to, and consented to by, the Agent and the
Majority Lenders, incurred or assumed in connection with Acquisitions permitted
hereunder and including refinancings and extensions thereof which do not
increase the principal amount of such Indebtedness as of the date of such
extension on refinancing and which are otherwise on terms and conditions that
taken as a whole are no less favorable to the Borrower or any of its
Subsidiaries than the terms of the Indebtedness being extended or refinanced.

5.6. Transactions with Affiliates. The Borrower shall not, and shall
not suffer or permit any of its Subsidiaries to, enter into any transaction
with any Affiliate of the Borrower or of any such Subsidiary, except:

(a) among Borrower and its Subsidiaries which are guarantors under
the Guaranty;

(b) customary directors' indemnification arrangements;

(d) in the Ordinary Course of Business and pursuant to the reasonable
requirements of the business of the Borrower or such Subsidiary;

39
46
and, in the case of clause (d), upon fair and reasonable terms no less
favorable to the Borrower or such Subsidiary than would obtain in a comparable
arm's-length transaction with a Person not an Affiliate of the Borrower or such
Subsidiary and which are disclosed in writing to Agent.

5.7. Management Fees and Compensation. The Borrower shall not, and
shall not permit any of its Subsidiaries to pay any management, consulting or
similar fees to any Affiliate of the Borrower or to any officer, director or
employee of the Borrower or any of its Subsidiaries or any Affiliate of the
Borrower except (a) payment of reasonable compensation to officers and
employees for actual services rendered to Borrower and its Subsidiaries in the
Ordinary Course of Business, (b) payment of reasonable and customary directors'
fees and reimbursement of actual out-of-pocket expenses incurred in connection
with attending board of director meetings.

5.8. Use of Proceeds. The Borrower shall not and shall not suffer or
permit any of its Subsidiaries to use any portion of the Loan proceeds,
directly or indirectly, to purchase or carry Margin Stock or repay or otherwise
refinance Indebtedness of the Borrower or others incurred to purchase or carry
Margin Stock, or otherwise in any manner which is in contravention of any
Requirement of Law or in violation of this Agreement.

5.9. Contingent Obligations. The Borrower shall not, and shall not
suffer or permit any of its Subsidiaries to, create, incur, assume or suffer to
exist any Contingent Obligations except in respect of the Obligations and
except:

(a) endorsements for collection or deposit in the Ordinary Course of
Business;

(b) Rate Contracts entered into in the Ordinary Course of Business
with the Agent's prior written consent;

(c) Contingent Obligations of the Borrower and its Subsidiaries
existing as of the Closing Date and listed in Schedule 5.9, including extension
and renewals thereof which do not increase the amount of such Contingent
Obligations as of the date of such extension or renewal;

(d) Contingent Obligations incurred in the Ordinary Course of
Business with respect to surety and appeal bonds, performance bonds and other
similar obligations;

(e) Contingent Obligations arising under indemnity agreements to
title insurers to cause such title insurers to issue to Agent title insurance
policies; and

(f) Contingent Obligations arising with respect to customary
indemnification obligations in favor of (i) sellers in connection with
Acquisitions permitted hereunder or consummated prior to the Closing Date and
(ii) purchasers in connection with dispositions permitted under subsection
5.2(b).

5.10. Compliance with ERISA. The Borrower shall not, and shall not
suffer or permit any of its Subsidiaries to:

40
47
(a) terminate any Plan subject to Title IV of ERISA so as to result
in any material liability to the Borrower;

(b) permit to exist any ERISA Event or any other event or condition,
which would reasonably be expected to have a Material Adverse Effect;

(c) make a complete or partial withdrawal (within the meaning of
ERISA Section 4201) from any Multiemployer Plan so as to result in any material
liability to the Borrower;

(d) enter into any new Plan or modify any existing Plan so as to
increase its obligations thereunder which would reasonably be expected to have
a Material Adverse Effect; or

(e) permit the present value of all nonforfeitable accrued benefits
under any Plan (using the actuarial assumptions utilized by the PBGC upon
termination of a Plan) materially to exceed the fair market value of Plan
assets allocable to such benefits, all determined as of the most recent
valuation date for each such Plan.

5.11. Restricted Payments. The Borrower shall not, and shall not
suffer or permit any of its Subsidiaries to, (i) declare or make any dividend
payment or other distribution of assets, properties, cash, rights, obligations
or securities on account of any shares of any class of its capital stock,
partnership interests, membership interests or other equity securities, (ii)
purchase, redeem or otherwise acquire for value any shares of its capital
stock, partnership interests, membership interests or other equity securities
or any warrants, rights or options to acquire such shares, interests or
securities now or hereafter outstanding or (iii) make any payment or prepayment
of principal of, premium, if any, interest, redemption, exchange, purchase,
retirement, defeasance, sinking fund or similar payment with respect to,
Subordinated Indebtedness (the items described in clauses (i), (ii) and (iii)
are referred to as "Restricted Payments"); except that any Wholly-Owned
Subsidiary of the Borrower may declare and pay dividends to the Borrower or any
Wholly-Owned Subsidiary of the Borrower, and except that the Borrower may:

(a) declare and make dividend payments or other distributions payable
solely in its common stock or exchange shares of 13% Exchangeable Preferred
Stock (Series A) for substantially identical shares of 13% Exchangeable
Preferred Stock (Series B) pursuant to the Registration Rights Agreement
contemplated by the Securities Purchase Agreement;

(b) to the extent required by the terms of any class of Preferred
Stock, declare and make dividend payments to the holders of such class of
Preferred Stock payable solely in such class of Preferred Stock; and

(c) redeem from management stockholders shares of the Borrower's
common stock or warrants or options to acquire any such shares provided all of
the following conditions are satisfied:

41
48
(i) no Default or Event of Default has occurred and is
continuing or would arise as a result of such redemption;

(ii) after giving effect to such redemption, the Borrower is in
compliance on a pro forma basis with the covenants set
forth in Article 6, recomputed for the most recent month
for which financial statements have been delivered;

(iii) the aggregate redemptions permitted in any fiscal year of
the Borrower shall not exceed $1,000,000; and

(iv) after giving effect to such redemption, the Maximum
Revolving Loan Balance exceeds the aggregate outstanding
principal balance of Revolving Loans by not less than
$2,500,000.

5.12. Change in Business. The Borrower shall not, and shall not
permit any of its Subsidiaries to, engage in any material line of business
substantially different from those lines of business carried on by it on the
date hereof.

5.13. Change in Structure; Issuance of Disqualified Stock. (a)
Except as expressly permitted under Section 5.3, the Borrower shall not and
shall not permit any of its Subsidiaries to amend its certificate of
incorporation or by-laws in any material respect or in any respect adverse to
the Agent or the Lenders. The Borrower shall not cause any Indebtedness other
than the Obligations to be designated as "Permitted Indebtedness" under clause
(vi) of the definition thereof set forth in the Indenture.

(b) Issue any shares of Disqualified Stock, or warrants or securities
convertible into or exercisable or exchangeable for Disqualified Stock, or
amend the terms of its outstanding capital stock in any respect adverse to the
Agent or the Lenders.

5.14. Accounting Changes. The Borrower shall not, and shall not
suffer or permit any of its Subsidiaries to, make any significant change in
accounting treatment or reporting practices, except as required by GAAP, or
change the fiscal year of the Borrower or of any of its consolidated
Subsidiaries.

5.15. Amendments to Related Agreements; Indenture. (a) The Borrower
shall not (i) amend, supplement, waive or otherwise modify any provision of,
the Related Agreements in a manner adverse to Agent or Lenders or which could
reasonably be expected to have a Material Adverse Effect, or (ii) take or fail
to take any action under the Related Agreements that could reasonably be
expected to have a Material Adverse Effect.

(b) The Borrower shall not, and shall not permit any of its
Subsidiaries to, prepay any sums due under the Indenture or the Senior Notes or
modify the terms of the Indenture or the Senior Notes (except pursuant to
Section 9.01 of the Indenture).

42
49
5.16. Acquisitions.

(a) When the Borrower or any of its Subsidiaries desires to make an
Acquisition, the Borrower shall deliver, or cause to be delivered, to the Agent
and each Lender, not less than ten (10) Business Days (three (3) Business Days
in the case of an Acquisition in respect of which the Acquisition Cost is less
than $10,000,000) prior to consummation of such Acquisition, an acquisition
summary with respect to the Target and such potential Acquisition, such summary
to include a reasonably detailed description of the Target and its business
(including financial information) and operating results (including financial
statements), the terms and conditions, including economic terms, of the
proposed Acquisition, and the Borrower's calculation of Pro Forma EBITDA of
such Target.

(b) The Borrower will not consummate and will not permit any
Subsidiary of the Borrower to consummate any Acquisition unless all of the
following conditions are satisfied:

(i) the Target must be in the same or a related line of
business as the Borrower and its Subsidiaries, and the transaction must
be structured as an asset purchase by, or merger with, a Wholly-Owned
Subsidiary or a purchase by the Borrower or a Wholly-Owned Subsidiary of
all of the capital stock and other equity interests of such Target;

(ii) the Target must not have material contingent liabilities
unless either (x) such liabilities are cash collateralized pursuant to
appropriate escrow arrangements or are covered by insurance or (y) such
liabilities, individually and when combined with contingent liabilities
of Targets theretofore acquired by the Borrower after the Closing Date,
do not exceed, in the aggregate, $1,000,000;

(iii) no Default or Event of Default shall have occurred and be
continuing or would arise as a result of such Acquisition;

(iv) on a pro forma basis after giving effect to such
Acquisition, including the incurrence or assumption of Indebtedness in
connection therewith and the funding of Loans, if any, the Leverage
Ratio on a pro forma basis shall not exceed the Maximum Leverage Ratio
set forth in Section 6.2;

(v) the aggregate purchase price (including the fair market
value of any non-cash component of such purchase price and amounts paid
to refinance prior Indebtedness of the Target) to be paid by the
Borrower or its Subsidiaries (all such items being collectively referred
to as the "Acquisition Cost") for any single Acquisition shall be less
than $10,000,000;

(vi) the Agent shall have approved the Borrower's computation
of Pro Forma EBITDA, notwithstanding that consent to the Acquisition
with respect to which Pro Forma EBITDA is being determined may not be
required; and

43
50
(vii) at the time and immediately after the consummation of any
such Acquisition, the Maximum Revolving Loan Balance shall exceed the
outstanding principal balance of the Revolving Loans by not less than
$2,500,000.

In the event any of the foregoing conditions has not been satisfied,
then the Agent's and the Majority Lenders' consent to the Acquisition shall be
required; provided that such consent shall not be unreasonably withheld if all
of the foregoing conditions have been satisfied other than the condition set
forth in clause (v) above.

(c) It is understood and agreed that the Agent's and each Lender's
decision to consent to an Acquisition, if required, shall be based upon the
Agent's and such Lender's evaluation and approval of the business and financial
condition of the Target and review and approval of the Acquisition Documents in
connection with the proposed Acquisition.

(d) No later than ten (10) Business Days (three (3) Business Days in
the case of an Acquisition in respect of which the Acquisition Cost is less
than $10,000,000) after the Agent's and the Lenders' receipt of the acquisition
summary, the Agent will notify the Borrower, in writing, whether or not the
Agent and the Majority Lenders consent to the proposed Acquisition on the terms
set forth in the acquisition summary, if such consent is otherwise required
hereunder. If there is any material change to the terms of the proposed
Acquisition with respect to which the consent of the Agent and the Majority
Lenders is required (or any proposed Acquisition which, due to such material
change, shall or would require the consent of the Agent and the Majority
Lenders), any adverse change in Pro Forma EBITDA or any other material adverse
change to the Target which is the subject of such proposed Acquisition, the
Borrower shall notify the Agent and the Lenders of the same and further consent
will be required, which consent will be granted or denied within ten (10)
Business Days (three (3) Business Days in the case of an Acquisition in respect
of which the Acquisition Cost is less than $10,000,000) of receipt of written
notice of such material change.

(e) The foregoing provisions do not impair, vitiate or affect the
conditions to the Lenders' obligations to fund Loans, or the Agent's
obligations to issue Lender Letters of Credit or Letter of Credit Participation
Agreements, as provided in Sections 2.1, 2.2 and 2.3 of this Agreement.

ARTICLE VI. - FINANCIAL COVENANTS

6.1. Capital Expenditures. The Borrower and its Subsidiaries shall
not make or commit to make Capital Expenditures for any fiscal year set forth
below to exceed the amount set forth in the table below (the "Capital
Expenditure Limitation") with respect to such fiscal year:

44
51

Fiscal Year Capital Expenditure Limitation
----------- ------------------------------

1998 $17,000,000
1999 $17,000,000
-2000 $20,000,000
2001 $22,000,000
2002 and each fiscal year thereafter $25,000,000

; provided, however, in the event the Borrower and its Subsidiaries do not
expend the entire Capital Expenditure Limitation in any fiscal year, Borrower
and its Subsidiaries may carry forward to the immediately succeeding fiscal
year 50% of the unutilized portion. All Capital Expenditures shall first be
applied to reduce the applicable Capital Expenditure Limitation and then to
reduce the carry-forward from the previous fiscal year, if any. "Capital
Expenditures" shall be calculated in the manner set forth in Exhibit 4.2(b).

6.2. Leverage Ratio. The Borrower shall not permit its Leverage
Ratio determined as of each date set forth below for the twelve month period
then ended to be greater than the maximum ratio set forth in the table below
opposite such date:

Date Maximum Leverage Ratio
---- ----------------------

September 30, 1998 7.00
December 31, 1998 7.00
March 31, 1999 6.75
June 30, 1999 6.50
September 30, 1999 6.25
December 31, 1999 6.25
March 31, 2000 6.00
June 30, 2000 5.75
September 30, 2000 5.50
December 31, 2000 5.50
March 31, 2001 5.25
June 30, 2001 5.00
September 30, 2001 5.00
December 31, 2001 4.75
March 31, 2002 4.75
June 30, 2002 4.50
September 30, 2002 and the last day of 4.25
each fiscal quarter thereafter

"Leverage Ratio" shall be calculated in the manner set forth in Exhibit 4.2(b).

45
52
6.3. Fixed Charge Coverage Ratio. The Borrower shall not permit its
Fixed Charge Coverage Ratio for each of the periods set forth below to be less
than the minimum ratio set forth in the table below for such period:

Period Minimum Fixed Charge Coverage Ratio
------ -----------------------------------

Closing Date through September 30, 1998 1.10
Closing Date through December 31, 1998 1.10
Closing Date through March 31, 1999 1.10
Twelve-month period ending June 30, 1999 1.15
Twelve-month period ending September 30, 1999 1.15

The Borrower shall not permit its Fixed Charge Coverage Ratio for the
twelve-month period ending on December 31, 1999 and for the twelve-month period
ending on the last day of each fiscal quarter thereafter to be less than 1.20.

Date Minimum Fixed Charge Coverage Ratio
---- -----------------------------------

"Fixed Charge Coverage Ratio" shall be calculated in the manner set forth in
Exhibit 4.2(b).

6.4. Interest Coverage Ratio. The Borrower shall not permit its
Interest Charge Coverage Ratio for each of the periods set forth below to be
less than the minimum ratio set forth in the table below for such period:

Period Minimum Interest Charge Coverage Ratio
------ --------------------------------------

Closing Date through September 30, 1998 1.50
Closing Date through December 31, 1998 1.50
Closing Date through March 31, 1999 1.50

The Borrower shall not permit its Interest Coverage Ratio determined as
of each date set forth below for the twelve months then ended to be less than
the minimum ratio set forth in the table below opposite such date:

Date Minimum Interest Coverage Ratio
---- -------------------------------

June 30, 1999 1.50
September 30, 1999 1.50
December 31, 1999 1.60
March 31, 2000 1.60
June 30, 2000 1.75
September 30, 2000 1.75
December 31, 2000 1.75

46
53

March 31, 2001 1.90
June 30, 2001 1.90
September 30, 2201 2.00
December 31, 2001 2.00
March 31, 2002 2.10
June 30, 2002 and the last day of each fiscal 2.25
quarter thereafter

"Interest Coverage Ratio" shall be calculated in the manner set forth in
Exhibit 4.2(b).

ARTICLE VII. - EVENTS OF DEFAULT

7.1. Event of Default. Any of the following shall constitute an
"Event of Default":

(a) Non-Payment. The Borrower fails to pay, (i) when and as
required to be paid herein, any amount of principal of or interest on any Loan,
including after maturity of the Loans, whether by acceleration or otherwise, or
(ii) within five (5) days after the same shall become due, any fee or any other
amount payable hereunder or pursuant to any other Loan Document; or

(b) Representation or Warranty. Any representation or warranty by
the Borrower or any of its Subsidiaries made or deemed made herein, in any Loan
Document, or which is contained in any certificate, document or financial or
other statement by the Borrower, any of its Subsidiaries, or their respective
Responsible Officers, furnished at any time under this Agreement, or in or
under any Loan Document, shall prove to have been incorrect in any material
respect on or as of the date made or deemed made; or

(c) Specific Defaults. The Borrower fails to perform or observe
any term, covenant or agreement contained in Sections 4.1, 4.2(b), 4.2(d),
4.9, 4.13 or the first sentence of Section 4.6 or Article V or Article VI
hereof; or

(d) Other Defaults. The Borrower or any of its Subsidiaries fails
to perform or observe any other term, covenant or agreement contained in this
Agreement or any Loan Document, and such default shall continue unremedied for
a period of thirty (30) days after the date upon which written notice thereof
is given to the Borrower by the Agent or Required Lenders; or

(e) Cross-Default. The Borrower or any of its Subsidiaries (i)
fails to make any payment in respect of the Senior Notes or any other
Indebtedness (other than the Obligations) or Contingent Obligation 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 $2,500,000 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 document relating thereto on the date of such failure; or (ii)
fails to perform or observe any other condition or covenant, or any

47
54
other event shall occur or condition exist, under any agreement or instrument
relating to any such Indebtedness or Contingent Obligation, 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 prior to its stated maturity, or such Contingent Obligation to
become payable or cash collateral in respect thereof to be demanded; or

(f) Insolvency; Voluntary Proceedings. The Borrower or any of its
Subsidiaries (i) ceases or fails to be Solvent, (ii) 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;
(iii) voluntarily ceases to conduct its business in the ordinary course; (iv)
commences any Insolvency Proceeding with respect to itself; or (v) 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 Borrower or any Subsidiary of the
Borrower, or any writ, judgment, warrant of attachment, execution or similar
process, is issued or levied against a substantial part of the Borrower's or
any of its Subsidiaries' Properties, and any such proceeding or petition shall
not be dismissed, or such writ, judgment, warrant of attachment, execution or
similar process shall not be released, vacated or fully bonded within sixty
(60) days after commencement, filing or levy; (ii) the Borrower or any of its
Subsidiaries 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 Borrower or any of
its Subsidiaries 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) A member of the Controlled Group shall fail to pay
when due, after the expiration of any applicable grace period, any installment
payment with respect to its Withdrawal Liability under a Multiemployer Plan;
(ii) a member of the Controlled Group shall fail to satisfy its contribution
requirements under Section 412(c)(11) of the Code, whether or not it has sought
a waiver under Section 412(d) of the Code; (iii) the occurrence of an ERISA
Event; (iv) a Plan that is intended to be qualified under Section 401(a) of the
Code shall lose its qualification; (v) any member of the Controlled Group
engages in or otherwise becomes liable for a non-exempt prohibited transaction;
(vi) a violation of section 404 or 405 of ERISA or the exclusive benefit rule
under section 401(a) of the Code; (vii) any member of the Controlled Group is
assessed a tax under section 4980B of the Code or incurs a liability under
Section 601 et seq of ERISA; and, the occurrence of any such event listed in
clauses (i) through (vii), or the occurrence of any combination of events
listed in clauses (i) through (vii) results in, or could reasonably be expected
to result in, a Material Adverse Effect or result in exposure to Borrower in an
amount in excess of $2,500,000; or

48
55
(i) Monetary Judgments. One or more judgments, non-interlocutory
orders, decrees or arbitration awards shall be entered against the Borrower or
any of its Subsidiaries involving in the aggregate a liability (to the extent
not covered by independent third-party insurance) as to any single or related
series of transactions, incidents or conditions, of $1,000,000 or more, and the
same shall remain unsatisfied, unvacated and unstayed pending appeal for a
period of thirty (30) days after the entry thereof; or

(j) Non-Monetary Judgments. Any non-monetary judgment, order or
decree shall be rendered against the Borrower or any of its Subsidiaries which
does or would reasonably be expected to have a Material Adverse Effect, and
there shall be any period of ten (10) 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) Collateral. Any material provision of any Collateral Document
shall for any reason cease to be valid and binding on or enforceable against
the Borrower or any Subsidiary of the Borrower party thereto or the Borrower or
any Subsidiary of the Borrower shall so state in writing or bring an action to
limit its obligations or liabilities thereunder; or any Collateral Document
shall for any reason (other than pursuant to the terms thereof) cease to create
a valid security interest in the Collateral purported to be covered thereby or
such security interest shall for any reason (other than the failure of the
Agent to take any action within its control) cease to be a perfected and first
priority security interest subject only to Permitted Liens; or

(l) Change in Control. A Change in Control shall occur.

7.2. Remedies. Upon the occurrence and during the continuance of any
Event of Default, the Agent may, and shall at the request of the Required
Lenders:

(a) declare all or any portion of the Commitment of each Lender to
make Loans or issue Lender Letters of Credit or Letter of Credit Participation
Agreements to be terminated, whereupon such Commitments shall forthwith be
terminated;

(b) declare the unpaid principal amount of all outstanding Loans, all
interest accrued and unpaid thereon, and all other amounts owing or payable
hereunder or under any other Loan Document to be immediately due and payable,
without presentment, demand, protest, notice of acceleration, notice of intent
to accelerate or other notice of any kind, all of which are hereby expressly
waived by the Borrower; 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
subsections 7.1(f) and (g) above (in the case of clause (i) of paragraph (g)
upon the expiration of the 60-day period mentioned therein), the obligation of
each Lender to make Loans and the obligation of Agent to issue Lender Letters
of Credit and Letter of Credit Participation Agreements shall automatically

49
56
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 or any Lender and without presentment,
demand, protest, notice of acceleration, notice of intent to accelerate or
other notice of any kind, all of which are hereby expressly waived by the
Borrower.

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

7.4. Cash Collateral for Letters of Credit. If an Event of Default
has occurred and is continuing or this Agreement shall be terminated for any
reason, then the Agent may and upon request of Lenders holdings at least sixty-
six and two-thirds percent (66 2/3%) of the Revolving Loan Commitments shall,
demand (which demand shall be deemed to have been delivered automatically upon
any acceleration of the Loans and other obligations hereunder pursuant to
Section 7.2 hereof), and Borrower shall thereupon deliver to the Agent, to be
held for the benefit of the Agent and the Lenders entitled thereto, an amount
of cash equal to the amount of Letter of Credit Participation Liability
(determined in accordance with subsection 1.1(b) hereof) as additional
collateral security for Borrower's Obligations in respect of any outstanding
Lender Letter of Credit and Letter of Credit Participation Agreement. The
Agent may at any time apply any or all of such cash and cash collateral to the
payment of any or all of Borrower's Obligations in respect of any Lender
Letters of Credit or Letter of Credit Participation Agreements. Pending such
application, the Agent may (but shall not be obligated to) invest the same in
an interest bearing account in the Agent's name, for the benefit of the Agent
and the Lenders entitled thereto, under which deposits are available for
immediate withdrawal, at such bank or financial institution as the Agent may,
in its discretion, select.

ARTICLE VIII. - THE AGENT

8.1. Appointment and Authorization. Each Lender hereby irrevocably
appoints, designates and authorizes the Agent to take such action on its behalf
under the provisions of this Agreement and each other Loan Document and to
exercise such powers and perform such duties as are expressly delegated to it
by the terms of this Agreement or any other Loan Document, together with such
powers as are reasonably incidental thereto. Notwithstanding any provision to
the contrary contained elsewhere in this Agreement or in any other Loan
Document, the Agent shall not have any duties or responsibilities, except those
expressly set forth herein, nor shall the 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.

8.2. Delegation of Duties. The Agent may execute any of its duties
under this Agreement or any other Loan Document by or through agents, employees
or attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. The

50
57
Agent shall not be responsible for the negligence or misconduct of any agent or
attorney-in-fact that it selects with reasonable care.

8.3. Liability of Agent. None of the Agent-Related Persons shall (i)
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 (except for its
own gross negligence or willful misconduct), or (ii) be responsible in any
manner to any of the Lenders for any recital, statement, representation or
warranty made by the Borrower or any Subsidiary or Affiliate of the Borrower,
or any officer thereof, contained in this Agreement or in any other Loan
Document, or in any certificate, report, statement or other document referred
to or provided for in, or received by the Agent under or in connection with,
this Agreement or any other Loan Document, or for the value of any Collateral
or the validity, effectiveness, genuineness, enforceability or sufficiency of
this Agreement or any other Loan Document, or for any failure of the Borrower
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 inspect the Properties, books or records of the Borrower or any
of the Borrower's Subsidiaries or Affiliates.

8.4. Reliance by Agent. The Agent shall be entitled to rely, and
shall be fully protected in relying, upon any writing, resolution, notice,
consent, certificate, affidavit, letter, telegram, facsimile or telephone
message, statement or other document or conversation believed by it to be
genuine 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
Borrower), independent accountants and other experts selected by the Agent.
The Agent shall be fully justified in failing or refusing to take any action
under this Agreement or any other Loan Document unless it shall first receive
such advice or concurrence of the Lenders (or, where an action or waiver need
only be approved by the Required Lenders or the Majority Lenders, by the
Required Lenders or the Majority Lenders, as applicable) as it deems
appropriate and, if it so requests, it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense which may
be incurred by it by reason of taking or continuing to take any such action.
The 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 Lenders (or, where an action or waiver need only be
approved by the Required Lenders or the Majority Lenders, by the Required
Lenders or the Majority Lenders, as applicable) and such request and any action
taken or failure to act pursuant thereto shall be binding upon all of the
Lenders.

8.5. Notice of Default. The Agent shall not be deemed to have
knowledge or notice of the occurrence of any Default or Event of Default,
except with respect to defaults in the payment of principal, interest and fees
required to be paid to the Agent for the account of the Lenders, unless the
Agent shall have received written notice from a Lender or the Borrower
referring to this Agreement, describing such Default or Event of Default and
stating that such notice is a "notice of default". In the event that the Agent
receives such a notice, the Agent shall give notice

51
58
thereof to the Lenders. The Agent shall take such action with respect to such
Default or Event of Default as shall be requested by the Required Lenders in
accordance with Article VII; provided, however, that unless and until the Agent
shall have 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.

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

8.7. Indemnification. Whether or not the transactions contemplated
hereby shall be consummated, upon demand therefor the Lenders shall indemnify
the Agent (to the extent not reimbursed by or on behalf of the Borrower and
without limiting the obligation of the Borrower to do so), ratably from and
against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses and disbursements of any kind
whatsoever which may at any time (including at any time following the repayment
of the Loans and the termination or resignation of the Agent) be imposed on,
incurred by or asserted against the Agent 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 thereby or any action taken or omitted by
the Agent under or in connection with any of the foregoing; provided, however,
that no Lender shall be liable for the payment to the Agent of any portion of
such liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements resulting solely from the Agent's gross
negligence or willful misconduct. In addition, each Lender shall reimburse the
Agent upon demand for its ratable share of any costs or out-of-pocket expenses
(including Attorney Costs) incurred by the Agent in connection with the
preparation, execution, delivery, administration, modification, amendment or
enforcement (whether through

52
59
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
is not reimbursed for such expenses by or on behalf of the Borrower. Without
limiting the generality of the foregoing, if the Internal Revenue Service 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, 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 8.7, together with all related costs and expenses
(including Attorney Costs). The obligation of the Lenders in this Section 8.7
shall survive the payment of all Obligations hereunder.

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

8.9. Successor Agent. The Agent may resign as Agent upon thirty (30)
days' prior notice to the Lenders and to Borrower. If the Agent shall resign
as Agent under this Agreement, the Required Lenders shall appoint from among
the Lenders a successor agent for the Lenders, subject to the consent of the
Borrower (not to be unreasonably withheld). If no successor agent is appointed
prior to the effective date of the resignation of the Agent, the Agent may
thereupon appoint a successor agent from among the Lenders reasonably
acceptable to Borrower. Upon the acceptance of its appointment as successor
agent hereunder, such successor agent shall succeed to all the rights, powers
and duties of the retiring Agent and the term "Agent" shall mean such successor
agent and the retiring Agent's appointment, powers and duties as Agent shall be
terminated. After any retiring Agent's resignation hereunder as Agent, the
provisions of this Article VIII and Sections 9.4 and 9.5 shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was Agent
under this Agreement. If no successor agent has accepted appointment as Agent
by the date which is thirty (30) days following a retiring Agent's notice of
resignation (or, if later, ten (10) days after the date upon which the Agent
designates a successor agent), the retiring Agent's resignation shall
nevertheless thereupon become effective and the Lenders shall perform all of
the duties of the Agent hereunder until such time, if any, as the Required
Lenders appoint a successor agent as provided for above.

53
60
8.10. Collateral Matters.

(a) The Agent is authorized (but not required) on behalf of all the
Lenders, without the necessity of any notice to or further consent from the
Lenders, from time to time to take any action with respect to any Collateral or
the Collateral Documents which may be necessary to perfect and maintain
perfected the security interest in and Liens upon the Collateral granted
pursuant to the Collateral Documents.

(b) The Lenders irrevocably authorize the Agent, at its option and in
its discretion, to release any Lien granted to or held by the Agent upon any
Collateral:

(i) upon termination of the Commitments and payment in full of
all Loans and all other Obligations then payable under this Agreement
and under any other Loan Document;

(ii) constituting Property sold or to be sold or disposed of as
part of or in connection with any disposition permitted hereunder;

(iii) consisting of an instrument evidencing Indebtedness or of
any other debt instrument, if the indebtedness evidenced thereby has
been paid in full; or

(iv) if approved, authorized or ratified in writing by the
Required Lenders or all the Lenders, as the case may be, as provided in
subsection 9.1(f).

Upon request by the Agent at any time, the Lenders will confirm in writing the
Agent's authority to release particular types or items of Collateral pursuant
to this subsection 8.10(b). The Borrower shall be entitled to rely on any Lien
release executed by the Agent.

(c) Each Lender agrees with and in favor of each other Lender (which
agreement shall not be for the benefit of the Borrower or any of its
Subsidiaries) that the Borrower's obligation to such Lender under this
Agreement and the other Loan Documents shall be equally and ratably secured by
any real property and/or other collateral now or hereafter securing any
obligations of the Borrower or any of its Subsidiaries to such Lender, whether
or not the same constitutes Collateral hereunder.

54
61
ARTICLE IX. - MISCELLANEOUS

9.1. Amendments and Waivers. No amendment or waiver of any provision
of this Agreement or any other Loan Document, and no consent with respect to
any departure by the Borrower therefrom, shall be effective unless the same
shall be in writing and signed by the Required Lenders (or, if otherwise
expressly provided for herein, the Majority Lenders), the Borrower and
acknowledged by the Agent, and then such waiver shall be effective only in the
specific instance and for the specific purpose for which given; provided,
however, that no such waiver, amendment, or consent shall, unless in writing
and signed by all the Lenders, the Borrower and acknowledged by the Agent, do
any of the following:

(a) increase or extend the Commitment of any Lender (or reinstate any
Commitment terminated pursuant to subsection 7.2(a)) or subject any Lender to
any additional obligations;

(b) postpone or delay any date fixed for any payment of principal,
interest, fees or other amounts due to the Lenders (or any of them) hereunder
or under any Loan Document (other than any mandatory prepayment of the Loans
pursuant to subsection 1.8(c), 1.8(d) or 1.8(e));

(c) reduce the principal of, or the rate of interest specified herein
or the amount of interest payable in cash specified herein on any Loan, or of
any fees or other amounts payable hereunder or under any Loan Document;

(d) change the percentage of the Commitments or of the aggregate
unpaid principal amount of the Loans which shall be required for the Lenders or
any of them to take any action hereunder;

(e) amend this Section 9.1 or the definition of Required Lenders or
Majority Lenders or any provision providing for consent or other action by all
Lenders; or

(f) discharge any Subsidiary from its Obligations under the Loan
Documents, or release all or substantially all of the Collateral except as
otherwise may be provided in this Agreement or the other Loan Documents;

and, provided further, that no amendment, waiver or consent shall, unless in
writing and signed by the Agent in addition to the Majority Lenders, the
Required Lenders or all the Lenders, as the case may be, affect the rights or
duties of the Agent under this Agreement or any other Loan Document.

9.2. Notices. (a) All notices, requests and other communications
provided for hereunder shall be in writing (including, unless the context
expressly otherwise provides, by facsimile transmission) and mailed by
certified or registered mail, faxed or delivered by personal or overnight
delivery, to the address or facsimile number specified for notices on the
applicable signature page hereof; or, if directed to the Borrower or the Agent,
to such other address as shall be designated by such party in a written notice
to each of the other parties hereto given in

55
62
compliance herewith, or, if directed to any other party hereto, to such other
address as shall be designated by such party in a written notice given in
compliance herewith to the Borrower and the Agent.

(b) All such notices, requests and communications shall be deemed
given (i) if delivered in person, when delivered, (ii) if delivered by
telecopy, on the date of transmission if transmitted on a Business Day before
4:00 p.m. Chicago Time, otherwise on the next Business Day, (iii) if delivered
by overnight courier, one (1) Business Day after delivery to the courier
properly addressed and (iv) if mailed, upon the third Business Day after the
date deposited into the U.S. Mail, certified or registered; except that notices
pursuant to Article I shall not be deemed given until actually received by the
Agent.

(c) The Borrower acknowledges and agrees that any agreement of the
Agent and the Lenders in Article I hereof to receive certain notices by
telephone and facsimile is solely for the convenience and at the request of the
Borrower. The Agent and the Lenders shall be entitled to rely on the authority
of any Person purporting to be a Person authorized by the Borrower to give such
notice and the Agent and the Lenders shall not have any liability to the
Borrower or other Person on account of any action taken or not taken by the
Agent or the Lenders in good faith in reliance upon such telephonic or
facsimile notice. The obligation of the Borrower to repay the Loans shall not
be affected in any way or to any extent by any failure by the Agent and the
Lenders to receive written confirmation of any telephonic or facsimile notice
or the receipt by the Agent and the Lenders of a confirmation which is at
variance with the terms understood by the Agent and the Lenders to be contained
in the telephonic or facsimile notice.

9.3. No Waiver; Cumulative Remedies. No failure to exercise and no
delay in exercising, on the part of the Agent or any Lender, any right, remedy,
power or privilege hereunder, shall operate as a waiver thereof; nor shall any
single or partial exercise of any right, remedy, power or privilege hereunder
preclude any other or further exercise thereof or the exercise of any other
right, remedy, power or privilege.

9.4. Costs and Expenses. Whether or not the transactions
contemplated hereby shall be consummated, the Borrower shall pay or reimburse:

(a) Antares (in its capacity as Agent) within five (5) Business Days
after demand (except as otherwise provided in subsection 2.1(f)) for all
reasonable out-of-pocket costs and expenses incurred by Antares (in its
capacity as Agent) in connection with the development, preparation,
syndication, delivery, administration 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 the Attorney Costs
incurred by Antares (including in its capacity as Agent) with respect thereto;

(b) pay or reimburse each Lender and the Agent within five (5)
Business Days after demand for all out-of-pocket costs and expenses incurred by
them in connection with the

56
63
enforcement, attempted enforcement, or preservation of any rights or remedies
during the existence of an Event of Default (including in connection with any
"workout" or restructuring regarding the Loans, and including in any Insolvency
Proceeding or appellate proceeding) under this Agreement, any other Loan
Document, and any such other documents, including Attorney Costs incurred by
the Agent and/or any Lender (provided that the Lenders shall only be entitled
to reimbursement for the Attorney Costs of one outside legal firm, which firm
shall be selected by the Majority Lenders); and

(c) pay or reimburse Agent within five (5) Business Days after demand
for all out-of-pocket appraisal, audit, environmental inspection and review
(including the allocated cost of such internal services), search and filing
costs, fees and expenses, incurred or sustained by Agent in connection with the
matters referred to under subsections (a) and (b) of this Section 9.4.

9.5. INDEMNITY.

(A) IN ADDITION TO THE PAYMENT OF COSTS AND EXPENSES PURSUANT TO
SECTION 9.4 (AND WITHOUT OBLIGATING THE BORROWER TO REIMBURSE THE AGENT AND THE
LENDERS FOR COSTS AND EXPENSES WHICH ARE THE SUBJECT OF SECTION 9.4), WHETHER
OR NOT THE TRANSACTIONS CONTEMPLATED HEREBY SHALL BE CONSUMMATED, THE BORROWER
SHALL INDEMNIFY, DEFEND AND HOLD HARMLESS EACH LENDER, THE AGENT AND EACH OF
THEIR RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES, COUNSEL, AGENTS AND
ATTORNEYS-IN-FACT (EACH, AN "INDEMNIFIED PERSON") FROM AND AGAINST ANY AND ALL
LIABILITIES, OBLIGATIONS, LOSSES, DAMAGES, PENALTIES, ACTIONS, JUDGMENTS,
SUITS, COSTS, CHARGES, EXPENSES OR DISBURSEMENTS (INCLUDING ATTORNEY COSTS):

(i) OF ANY KIND OR NATURE WHATSOEVER WITH RESPECT TO THE
EXECUTION, DELIVERY, ENFORCEMENT, PERFORMANCE AND ADMINISTRATION OF THIS
AGREEMENT AND ANY OTHER LOAN DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED
HEREBY AND THEREBY, AND WITH RESPECT TO ANY INVESTIGATION, LITIGATION OR
PROCEEDING (INCLUDING ANY INSOLVENCY PROCEEDING OR APPELLATE PROCEEDING)
RELATED TO THIS AGREEMENT OR THE LOANS OR THE USE OF THE PROCEEDS
THEREOF, WHETHER OR NOT ANY INDEMNIFIED PERSON IS A PARTY THERETO; AND

(ii) WHICH MAY BE INCURRED BY OR ASSERTED AGAINST SUCH
INDEMNIFIED PERSON IN CONNECTION WITH OR ARISING OUT OF ANY PENDING OR
THREATENED INVESTIGATION, LITIGATION OR PROCEEDING, OR ANY ACTION TAKEN
BY ANY PERSON, WITH RESPECT TO ANY ENVIRONMENTAL CLAIM ARISING OUT OF OR
RELATED TO ANY PROPERTY OF BORROWER OR ANY OF ITS SUBSIDIARIES;

57
64
(ALL THE FOREGOING, COLLECTIVELY, THE "INDEMNIFIED LIABILITIES"); PROVIDED,
THAT THE BORROWER SHALL HAVE NO OBLIGATION HEREUNDER TO ANY INDEMNIFIED PERSON
WITH RESPECT TO INDEMNIFIED LIABILITIES TO THE EXTENT ARISING FROM LEGAL
PROCEEDINGS COMMENCED AGAINST SUCH INDEMNIFIED PERSON BY ANY SHAREHOLDER OF
SUCH INDEMNIFIED PERSON.

(B) IN NO EVENT SHALL ANY SITE VISIT, OBSERVATION, OR TESTING BY THE
AGENT OR ANY LENDER (OR ANY CONTRACTEE OF THE AGENT OR ANY LENDER) BE DEEMED A
REPRESENTATION OR WARRANTY THAT HAZARDOUS MATERIALS ARE OR ARE NOT PRESENT IN,
ON, OR UNDER, THE SITE, OR THAT THERE HAS BEEN OR SHALL BE COMPLIANCE WITH ANY
ENVIRONMENTAL LAW. NEITHER THE BORROWER NOR ANY OTHER PERSON IS ENTITLED TO
RELY ON ANY SITE VISIT, OBSERVATION, OR TESTING BY THE AGENT OR ANY LENDER.
NEITHER THE AGENT NOR ANY LENDER OWES ANY DUTY OF CARE TO PROTECT THE BORROWER
OR ANY OTHER PERSON AGAINST, OR TO INFORM THE BORROWER OR ANY OTHER PARTY OF,
ANY HAZARDOUS MATERIALS OR ANY OTHER ADVERSE CONDITION AFFECTING ANY SITE OR
PROPERTY.

(C) THE FOREGOING INDEMNITIES SHALL EXTEND TO THE INDEMNIFIED PERSONS
NOTWITHSTANDING THE SOLE OR CONCURRENT NEGLIGENCE OF EVERY KIND OR CHARACTER
WHATSOEVER, WHETHER ACTIVE OR PASSIVE, WHETHER AN AFFIRMATIVE ACT OR AN
OMISSION, INCLUDING, WITHOUT LIMITATION, ALL TYPES OF NEGLIGENT CONDUCT
IDENTIFIED IN THE RESTATEMENT (SECOND) OF TORTS OF ONE OR MORE OF THE
INDEMNIFIED PERSONS OR BY REASON OF STRICT LIABILITY IMPOSED WITHOUT FAULT ON
ANY ONE OR MORE OF THE INDEMNIFIED PERSONS. TO THE EXTENT THAT AN INDEMNIFIED
PERSON IS FOUND BY A FINAL, NON-APPEALABLE JUDGMENT OF A COURT OF COMPETENT
JURISDICTION OR BY AGREEMENT TO HAVE COMMITTED AN ACT OF GROSS NEGLIGENCE OR
WILFUL MISCONDUCT, THIS CONTRACTUAL OBLIGATION OF INDEMNIFICATION SHALL
CONTINUE BUT, WITH RESPECT TO SUCH INDEMNIFIED PERSON, SHALL ONLY EXTEND TO THE
PORTION OF THE CLAIM THAT IS DEEMED TO HAVE OCCURRED BY REASON OF EVENTS OTHER
THAN THE GROSS NEGLIGENCE OR WILFUL MISCONDUCT OF SUCH INDEMNIFIED PERSON.

(D) THE OBLIGATIONS IN THIS SECTION 9.5 SHALL SURVIVE PAYMENT OF ALL
OTHER OBLIGATIONS. AT THE ELECTION OF ANY INDEMNIFIED PERSON, THE BORROWER
SHALL DEFEND SUCH INDEMNIFIED PERSON USING LEGAL COUNSEL SATISFACTORY TO SUCH
INDEMNIFIED PERSON IN SUCH PERSON'S SOLE DISCRETION, AT THE SOLE COST AND
EXPENSE OF THE BORROWER. ALL AMOUNTS OWING UNDER THIS SECTION 9.5 SHALL BE
PAID WITHIN THIRTY (30) DAYS AFTER DEMAND.

58
65
9.6. Marshaling; Payments Set Aside. Neither the Agent nor any
Lender shall be under any obligation to marshal any assets in favor of the
Borrower or any other Person or against or in payment of any or all of the
Obligations. To the extent that the Borrower makes a payment or payments to
the Agent or any Lender, or the Agent or any Lender enforces its Liens or
exercises its rights of setoff, and such payment or payments or the proceeds of
such enforcement or setoff 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 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 Obligations 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 enforcement or
setoff had not occurred; and

(b) each Lender severally agrees to pay to the Agent upon demand its
ratable share of the total amount so recovered from or repaid by the Agent.

9.7. 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; provided that any assignment by any Lender
shall be subject to the provisions of Section 9.8 hereof, and provided further
that the Borrower may not assign or transfer any of its rights or obligations
under this Agreement without the prior written consent of the Agent and each
Lender.

9.8. Assignments, Participations, etc. (a) Any Lender may, with the
written consent of Borrower, which consent shall not be unreasonably withheld,
and Agent, at any time assign and delegate to one or more Eligible Assignees
(provided that no written consent of the Agent or Borrower shall be required in
connection with any assignment and delegation by a Lender to an Eligible
Assignee that is an Affiliate of such Lender) (each an "Assignee") all, or any
ratable part of all, of the Loans, the Commitments and the other rights and
obligations of such Lender hereunder, in a minimum amount of $5,000,000 or, if
less, the entire Commitment of such Lender; provided, however, that the
Borrower and the 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 Borrower and the Agent by such
Lender and the Assignee;

(ii) such Lender and its Assignee shall have delivered to the
Borrower and the Agent an Assignment and Acceptance in form and
substance reasonably satisfactory to the Agent, such Lender and its
Assignee (an "Assignment and Acceptance"); and

(iii) the assignor Lender or the Assignee has paid to the Agent
a processing fee in the amount of $3,500.

59
66
(b) From and after the date that the Agent notifies the assignor
Lender that the Agent has received and 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 have been assigned to
it pursuant to such Assignment and Acceptance, shall have the rights and
obligations of a Lender under this Agreement and the other 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) Immediately upon the making of the processing fee payment to the
Agent in respect of 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 Commitment of the assigning Lender to the same extent.

(d) Any Lender may at any time sell to one or more commercial banks
or other Persons (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 shall provide written notice of
such assignment to the Borrower and the Agent;

(ii) the Originating Lender's obligations under this Agreement
shall remain unchanged;

(iii) the Originating Lender shall remain solely responsible for
the performance of such obligations;

(iv) the Borrower 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;

(v) no Lender shall transfer or grant any participating
interest under which the Participant shall have 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
the first proviso to Section 9.1; and

60
67
(vi) the participation shall be in a minimum amount of
$5,000,000 or, if less, the entire Commitment of such Originating
Lender.

In the case of any such participation, the Participant shall not have any
rights under this Agreement, or any of the other Loan Documents, and all
amounts payable by the Borrower hereunder shall be determined as if such Lender
had not sold such participation.

(e) Notwithstanding any other provision contained in this Agreement
or any other Loan Document to the contrary, any Lender may assign all or any
portion of the Loans held by it to any Federal Reserve Lender or the United
States Treasury as collateral security pursuant to Regulation A of the Federal
Reserve Board and any Operating Circular issued by such Federal Reserve Lender,
provided that any payment in respect of such assigned Loans made by the
Borrower to or for the account of the assigning or pledging Lender in
accordance with the terms of this Agreement shall satisfy the Borrower's
obligations hereunder in respect to such assigned Loans to the extent of such
payment. No such assignment shall release the assigning Lender from its
obligations hereunder.

9.9. Confidentiality. Each of the Agent and the Lenders shall
maintain in confidence in accordance with its customary procedures for handling
confidential information, all written information that Borrower or any of its
Subsidiaries, or any of their authorized representatives, furnishes to the
Agent or any Lender on a confidential basis clearly marked as such or that the
Agent or such Lender generally knows is confidential ("Confidential
Information"), other than any such Confidential Information that becomes
generally available to the public other than as a result of a breach by the
Agent or any Lender of its obligations hereunder or that is or becomes
available to the Agent or such Lender from a source other than Borrower or any
of its Subsidiaries, or any of their authorized representatives, and that is
not, to the actual knowledge of the recipient thereof, subject to obligations
of confidentiality with respect thereto; provided, however, that the Agent and
each Lender shall in any event have the right to deliver copies of any such
documents, and to disclose any such information, to:

(a) its directors, officers, trustees, partners, employees, agents,
attorneys and professional consultants;

(b) any other Lender and any successor Agent;

(c) any Person to which such Lender offers to sell any Loan or any
part thereof or interest or participation therein (provided such Person agrees
to keep such information confidential on the terms set forth in this Section
9.9);

(d) any federal or state regulatory authority or examiner, or any
insurance industry association, regulating or having jurisdiction over the
Agent or such Lender; and

(e) any other Person to which such delivery or disclosure may be
necessary or appropriate (i) in compliance with any applicable law, rule,
regulation or order, (ii) in response to

61
68
any subpoena or other legal process or informal investigative demand, (iii) in
connection with any litigation to which the Agent or such Lender is a party, or
(iv) in connection with the enforcement of the rights and remedies of the Agent
or the Lenders under this Agreement and the other Loan Documents at any time
when an Event of Default shall have occurred and be continuing; provided, that
with respect to clauses (i), (ii) and (iii), the Agent or such Lenders shall
use commercially reasonable efforts to provide notice to the Borrower before
releasing Confidential Information thereunder unless advised by counsel that
such notification is prohibited by law or could reasonably be expected to
result in criminal or civil liability to the Agent or such Lenders.

9.10. Set-off; Sharing of Payments. In addition to any rights and
remedies now or hereafter granted under applicable law, and not by way of
limitation of any such rights or remedies, upon the occurrence and during the
continuance of any Event of Default, each Lender is hereby authorized by the
Borrower at any time and from time to time, with reasonably prompt subsequent
notice to the Borrower or to any other Person (any prior or contemporaneous
notice being hereby expressly waived by the Borrower) to set off and to
appropriate and to apply any and all

(a) balances held by such Lender at any of its offices for the
account of the Borrower or any of its Subsidiaries (regardless of whether such
balances are then due to the Borrower or any of its Subsidiaries); and

(b) other Property at any time held or owing by such Lender to or for
the credit or for the account of the Borrower or any of its Subsidiaries;

against and on account of any and all Obligations which are not paid when due;
except that no Lender shall exercise such right without the prior written
consent of the Agent. Any Lender having a right to set off shall purchase for
cash (and the other Lenders shall sell) participations in each such other
Lender's pro rata share of the Obligations as would be necessary to cause such
Lender to share the benefit of such right of set-off with each other Lender in
accordance with their respective pro rata shares of the Obligations. The
Borrower agrees, to the fullest extent permitted by law, that (i) any Lender
may exercise its right to set off with respect to amounts in excess of its pro
rata share of the Obligations and may sell participations to other Lenders, and
(ii) any Lender so purchasing a participation in the Obligations held by other
Lenders may exercise all rights of setoff, bankers' lien, counterclaim or
similar rights with respect to such participation as fully as if such Lender
were a direct holder of Obligations in the amount of such participation. The
Borrower hereby grants to each Lender a security interest in all such deposits
and other Property, whether now existing or hereafter arising, held by each
Lender for the purposes set forth herein.

9.11. 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 its Lending Office,
of payment instructions in respect of all payments to be made

62
69
to it hereunder and of such other administrative information as the Agent shall
reasonably request.

9.12. Counterparts. This Agreement may be executed by one or more of
the parties to this Agreement 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. A set of the copies of this Agreement signed by all the parties
shall be lodged with each of the Borrower and the Agent.

9.13. 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.

9.14. Captions. The captions and headings of this Agreement are for
convenience of reference only and shall not affect the interpretation of this
Agreement.

9.15. Independence of Provisions. The parties acknowledge that this
Agreement and other Loan Documents may use several different limitations, tests
or measurements to regulate the same or similar matters, and that such
limitations, tests and measurements are cumulative and must each be performed,
except as expressly stated to the contrary in this Agreement.

9.16. Interpretation. This Agreement is the result of negotiations
among and has been reviewed by counsel to the Agent, the Borrower and other
parties, and is the product of all parties hereto. Accordingly, this Agreement
and the other Loan Documents shall not be construed against the Lenders or the
Agent merely because of the Agent's or Lenders' involvement in the preparation
of such documents and agreements.

9.17. No Third Parties Benefited. This Agreement is made and entered
into for the sole protection and legal benefit of the Borrower, the Lenders and
the Agent, 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. Neither the Agent nor any Lender nor (except as
provided under Section 9.5) the Borrower shall have any obligation to any
Person not a party to this Agreement or other Loan Documents.

9.18. Governing Law and Jurisdiction.

(A) THIS AGREEMENT AND EACH NOTE SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS AND DECISIONS OF THE STATE OF
ILLINOIS, WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES; PROVIDED THAT THE
AGENT AND THE LENDERS SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW.

63
70
(B) BORROWER HEREBY IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE
JURISDICTION OF ANY UNITED STATES FEDERAL OR ILLINOIS STATE COURT SITTING IN
CHICAGO IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO ANY LOAN
DOCUMENTS AND BORROWER HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF
SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH COURT AND
IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE AS TO THE VENUE
OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH A COURT OR THAT SUCH
COURT IS AN INCONVENIENT FORUM. NOTHING HEREIN SHALL LIMIT THE RIGHT OF AGENT
OR ANY LENDER TO BRING PROCEEDINGS AGAINST BORROWER IN THE COURTS OF ANY OTHER
JURISDICTION. ANY JUDICIAL PROCEEDING BY BORROWER AGAINST AGENT OR ANY LENDER
OR ANY AFFILIATE THEREOF INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER IN ANY
WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH ANY LOAN DOCUMENT SHALL BE
BROUGHT ONLY IN A COURT IN CHICAGO, ILLINOIS.

(C) BORROWER DESIGNATES AND APPOINTS CT CORPORATION SYSTEM AND
SUCH OTHER PERSONS AS MAY HEREAFTER BE SELECTED BY BORROWER WHICH IRREVOCABLY
AGREE IN WRITING TO SO SERVE AS ITS AGENT TO RECEIVE ON ITS BEHALF SERVICE OF
ALL PROCESS IN ANY SUCH PROCEEDINGS IN ANY SUCH COURT, SUCH SERVICE BEING
HEREBY ACKNOWLEDGED BY BORROWER TO BE EFFECTIVE AND BINDING SERVICE IN EVERY
RESPECT. A COPY OF ANY SUCH PROCESS SO SERVED SHALL BE MAILED BY REGISTERED
MAIL TO BORROWER AT ITS ADDRESS PROVIDED IN SUBSECTION 9.2 EXCEPT THAT UNLESS
OTHERWISE PROVIDED BY APPLICABLE LAW, ANY FAILURE TO MAIL SUCH COPY SHALL NOT
AFFECT THE VALIDITY OF SERVICE OF PROCESS. IF ANY AGENT APPOINTED BY BORROWER
REFUSES TO ACCEPT SERVICE, BORROWER HEREBY AGREES THAT SERVICE UPON IT BY MAIL
SHALL CONSTITUTE SUFFICIENT NOTICE. NOTHING HEREIN SHALL AFFECT THE RIGHT TO
SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW.

9.19. Waiver of Jury Trial. THE BORROWER, THE LENDERS AND THE 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 PARTIES, WHETHER WITH RESPECT TO CONTRACT
CLAIMS, TORT CLAIMS, OR OTHERWISE. THE BORROWER, THE LENDERS AND THE 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

64
71
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.

9.20. Entire Agreement; Release. This Agreement, together with the
other Loan Documents, embodies the entire agreement and understanding among the
Borrower, the Lenders and the Agent, and supersedes all prior or
contemporaneous Agreements and understandings of such Persons, oral or written,
relating to the subject matter hereof and thereof, except for the fee letter
referenced in subsection 1.9(a), and any prior arrangements made with respect
to the payment by the Borrower of (or any indemnification for) any fees, costs
or expenses payable to or incurred (or to be incurred) by or on behalf of the
Agent or the Lenders. Execution of this Agreement by the Borrower constitutes
a full, complete and irrevocable release of any and all claims which the
Borrower may have at law or in equity in respect of all prior discussions and
understandings, oral or written, relating to the subject matter of this
Agreement and the other Loan Documents. Neither Agent nor any Lender shall be
liable to Borrower or any other Person on any theory of liability for any
special, indirect, consequential or punitive damages.

ARTICLE X. - TAXES, YIELD PROTECTION AND ILLEGALITY

10.1. Taxes. (a) Subject to subsection 10.1(g), any and all
payments by the Borrower to each Lender or the Agent under this Agreement shall
be made free and clear of, and without deduction or withholding for, any and
all present or future taxes, levies, imposts, deductions, charges or
withholdings, and all liabilities with respect thereto, excluding, in the case
of each Lender and the Agent, such taxes (including income taxes or franchise
taxes) as are imposed on or measured by each Lender's overall income by the
jurisdiction under the laws of which such Lender or the Agent, as the case may
be, is organized or maintains a Lending Office or any political subdivision
thereof (all such non-excluded taxes, levies, imposts, deductions, charges,
withholdings and liabilities being hereinafter referred to as "Taxes").

(b) In addition, the Borrower shall pay any present or future stamp
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 or registration of, or otherwise with respect to, this Agreement or
any other Loan Documents (hereinafter referred to as "Other Taxes").

(c) Subject to subsection 10.1(g), the Borrower shall indemnify and
hold harmless each Lender and the Agent for the full amount of Taxes or Other
Taxes (including any Taxes or Other Taxes imposed by any jurisdiction on
amounts payable under this Section 10.1) paid by the Lender or the Agent and
any liability (including penalties, interest, additions to tax and expenses)
arising therefrom or with respect thereto, whether or not such Taxes or Other
Taxes

65
72
were correctly or legally asserted. Payment under this indemnification shall
be made within thirty (30) days from the date the Lender or the Agent makes
written demand therefor.

(d) If the Borrower shall be required by law to deduct or withhold
any Taxes or Other Taxes from or in respect of any sum payable hereunder to any
Lender or the Agent, then, subject to subsection 10.1(g):

(i) the sum payable shall be increased as necessary so that
after making all required deductions (including deductions applicable to
additional sums payable under this Section 10.1) such Lender or the
Agent, as the case may be, receives an amount equal to the sum it would
have received had no such deductions been made;

(ii) the Borrower shall make such deductions; and

(iii) the Borrower shall pay the full amount deducted to the
relevant taxation authority or other authority in accordance with
applicable law.

(e) Within thirty (30) days after the date of any payment by the
Borrower of Taxes or Other Taxes, the Borrower shall furnish to the Agent the
original or a certified copy of a receipt evidencing payment thereof, or other
evidence of payment reasonably satisfactory to the Agent.

(f) Each Lender that is not a citizen or resident of the United
States of America, a corporation, partnership or other entity created or
organized in or under the laws of the United States (or any jurisdiction
thereof), or any estate or trust that is subject to federal income taxation
regardless of the source of its income (a "Non-U.S. Lender") shall deliver to
the Borrower and the Agent two copies of each U.S. Internal Revenue Service
Form 1001 or Form 4224, or, in the case of a Non-U.S. Lender claiming exemption
from U.S. federal withholding tax under Section 871(h) or 881(c) of the Code
with respect to payments of "portfolio interest", a Form W-8, or any subsequent
versions thereof or successors thereto (and, if such Non-U.S. Lender delivers a
Form W-8, a certificate representing that such Non-U.S. Lender is not a "bank"
for purposes of Section 881(c) of the Code, is not a 10-percent shareholder
(within the meaning of Section 871(h)(3)(B) of the Code) of the Borrower and is
not a controlled foreign corporation related to the Borrower (within the
meaning of Section 864(d)(4) of the Code)), properly completed and duly
executed by such Non-U.S. Lender claiming complete exemption from, or a reduced
rate of, U.S. federal withholding tax on all payments by the Borrower under
this Agreement and the other Loan Documents. Such forms shall be delivered by
each Non-U.S. Lender on or before the date it becomes a party to this
Agreement. In addition, each Non-U.S. Lender shall deliver such forms promptly
upon the obsolescence or invalidity of any form previously delivered by such
Non-U.S. Lender. Each Non-U.S. Lender shall promptly notify the Borrower at
any time it determines that it is no longer in a position to provide any
previously delivered certificate to the Borrower (or any other form of
certification adopted by the U.S. taxing authorities for such purpose).
Notwithstanding any other provision of this subsection, a Non-U.S. Lender shall
not be required to deliver any form pursuant to this subsection that such Non-
U.S. Lender is not legally able to deliver.

66
73
(g) The Borrower will not be required to pay any additional amounts
in respect of United States Federal income tax pursuant to subsection 10.1(d)
to any Lender for the account of any Lending Office of such Lender:

(i) if the obligation to pay such additional amounts would not
have arisen but for a failure by such Lender to comply with its
obligations under subsection 10.1(f) in respect of such Lending Office;

(ii) if such Lender shall have delivered to the Borrower a Form
1001 and/or Form 4224 in respect of such Lending Office pursuant to
subsection 10.1(f), and such Lender shall not at any time be entitled to
exemption from deduction or withholding of United States Federal income
tax in respect of payments by the Borrower hereunder for the account of
such Lending Office for any reason other than a change in United States
law, treaty or regulations or in the official interpretation of such law
or regulations by any governmental authority charged with the
interpretation or administration thereof (whether or not having the
force of law) after the date of delivery of such Form 1001 and/or Form
4224; or

(iii) if such Lender shall have delivered to the Borrower a Form
W-8 in respect of such Lending Office pursuant to Subsection 10.1(f),
and such Lender shall not at any time be entitled to exemption from
deduction or withholding of United States Federal income tax in respect
of payments by the Borrower hereunder for the account of such Lending
Office for any reason other than a change in the United States law or
regulations or any applicable tax treaty or regulations or in the
official interpretation of any such law, treaty or regulations by any
governmental authority charged with the interpretation or administration
thereof (whether or not having the force of law) after the date of
delivery of such Form W-8.

(h) If the Borrower is required to pay additional amounts to any
Lender or the Agent pursuant to subsection 10.1(d), then such Lender shall use
its reasonable best 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 Borrower which may thereafter accrue if such change
in the judgment of such Lender is not otherwise disadvantageous to such Lender.

10.2. Illegality. (a) If after the date hereof any Lender shall
determine that the introduction of any Requirement of Law, or any change in any
Requirement of Law or in the interpretation or administration thereof, has made
it unlawful, or that any central bank or other Governmental Authority has
asserted that it is unlawful, for any Lender or its Lending Office to make
LIBOR Loans, then, on notice thereof by the Lender to the Borrower through the
Agent, the obligation of that Lender to make LIBOR Rate Loans shall be
suspended until the Lender shall have notified the Agent and the Borrower that
the circumstances giving rise to such determination no longer exists.

67
74
(b) Subject to clause (c) below, if a Lender shall determine that it
is unlawful to maintain any LIBOR Rate Loan, the Borrower shall prepay in full
all LIBOR Rate Loans of that Lender then outstanding, together with interest
accrued thereon, either on the last day of the Interest Period thereof if the
Lender may lawfully continue to maintain such LIBOR Rate Loans to such day, or
immediately, if the Lender may not lawfully continue to maintain such LIBOR
Rate Loans, together with any amounts required to be paid in connection
therewith pursuant to Section 10.4.

(c) If the obligation of any Lender to make or maintain LIBOR Rate
Loans has been terminated, the Borrower may elect, by giving notice to the
Lender through the Agent that all Loans which would otherwise be made by any
such Lender as LIBOR Rate Loans shall be instead Base Rate Loans.

(d) Before giving any notice to the Agent pursuant to this Section
10.2, the affected Lender shall designate a different Lending Office with
respect to its LIBOR 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.

10.3. Increased Costs and Reduction of Return. (a) If any Lender
shall determine that, due to either (i) the introduction of or any change in or
in the interpretation of any law or regulation or (ii) the compliance with any
guideline or request from any central bank or other Governmental Authority
(whether or not having the force of law) made, in the case of clause (i) or
(ii) subsequent to the date hereof, there shall be any increase in the cost to
such Lender of agreeing to make or making, funding or maintaining any LIBOR
Rate Loans, then the Borrower shall be liable for, and shall from time to time,
within 30 days of demand therefor by such Lender (with a copy of such demand to
the Agent), pay to the 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;

(ii) any change in any Capital Adequacy Regulation;

(iii) any change in the interpretation or administration of any
Capital Adequacy Regulation 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 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

68
75
capital) determines that the amount of such capital is increased as a
consequence of its Commitment(s), loans, credits or obligations under this
Agreement, then, within 30 days of demand of such Lender (with a copy to the
Agent), the Borrower shall upon demand pay to the Lender, from time to time as
specified by the Lender, additional amounts sufficient to compensate the Lender
for such increase.

10.4. Funding Losses. The Borrower agrees to reimburse each Lender
and to 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 Borrower to make any payment or mandatory
prepayment of principal of any LIBOR Rate Loan (including payments made after
any acceleration thereof);

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

(c) the failure of the Borrower to make any prepayment after the
Borrower has given a notice in accordance with Section 1.7;

(d) the prepayment (including pursuant to Section 1.8) of a LIBOR
Rate Loan on a day which is not the last day of the Interest Period with
respect thereto; or

(e) the conversion pursuant to Section 1.6 of any LIBOR Rate Loan to
a Base Rate Loan on a day that is not the last day of the applicable Interest
Period;

including any such loss or expense arising from the liquidation or reemployment
of funds obtained by such Lender to maintain its LIBOR Rate Loans hereunder or
from fees payable to terminate the deposits from which such funds were
obtained, but excluding any such loss or expense sustained by any Lender to the
extent arising from the gross negligence or willful misconduct of such Lender.
Solely for purposes of calculating amounts payable by the Borrower to the
Lenders under this Section 10.4 and under subsection 10.3(a): each LIBOR Rate
Loan made by a Lender (and each related reserve, special deposit or similar
requirement) shall be conclusively deemed to have been funded at the LIBOR used
in determining the interest rate for such LIBOR 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 LIBOR Rate Loan is in fact so
funded.

10.5. Inability to Determine Rates. If the Agent shall have
determined in good faith that for any reason adequate and reasonable means do
not exist for ascertaining the LIBOR for any requested Interest Period with
respect to a proposed LIBOR Rate Loan or that the LIBOR applicable pursuant to
subsection 1.3(a) for any requested Interest Period with respect to a proposed
LIBOR Rate Loan does not adequately and fairly reflect the cost to the Lenders
of funding such Loan, the Agent will forthwith give notice of such
determination to the Borrower

69
76
and each Lender. Thereafter, the obligation of the Lenders to make or maintain
LIBOR Rate Loans hereunder shall be suspended until the Agent revokes such
notice in writing. Upon receipt of such notice, the Borrower may revoke any
Notice of Borrowing or Notice of Conversion/Continuation then submitted by it.
If the Borrower does not revoke such notice, the Lenders shall make, convert or
continue the Loans, as proposed by the Borrower, in the amount specified in the
applicable notice submitted by the Borrower, but such Loans shall be made,
converted or continued as Base Rate Loans.

10.6. Reserves on LIBOR Rate Loans. The Borrower shall pay to each
Lender, as long as such Lender shall be required under regulations of the
Federal Reserve Board 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 LIBOR Rate Loan equal to 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 absent demonstrative error), payable on each
date on which interest is payable on such Loan provided the Borrower shall have
received at least fifteen (15) days' prior written notice (with a copy to the
Agent) of such additional interest from the Lender. If a Lender fails to give
notice fifteen (15) days prior to the relevant Interest Payment Date, such
additional interest shall be payable fifteen (15) days from receipt of such
notice.

10.7. Certificates of Lenders. Any Lender claiming reimbursement or
compensation pursuant to this Article X shall deliver to the Borrower (with a
copy to the Agent) a certificate setting forth in reasonable detail the amount
payable to the Lender hereunder (which certificate shall be delivered by such
Lender within 90 days after the date such Lender first has knowledge of the
event giving rise to such Lender's right to such reimbursement or compensation
and in any event within 360 days after the date of such event) and such
certificate shall be conclusive and binding on the Borrower in the absence of
manifest error.

10.8. Survival. The agreements and obligations of the Borrower in
this Article X shall survive the payment of all other Obligations.

10.9. Replacement of Lender in Respect of Increased Costs. Within
forty-five (45) days after receipt by the Borrower of written notice and demand
from any Lender (an "Affected Lender") for payment of additional costs as
provided in subsections 10.1, 10.3 and 10.6, the Borrower may, at its option,
notify the Agent and such Affected Lender of the Borrower's intention to
obtain, at the Borrower's expense, a replacement Lender ("Replacement Lender")
for such Affected Lender, which Replacement Lender shall be reasonably
satisfactory to the Agent. In the event the Borrower obtains a Replacement
Lender within ninety (90) days following notice of its intention to do so, the
Affected Lender shall sell and assign its Loans and Commitments to such
Replacement Lender, provided that the Borrower has reimbursed such Affected
Lender for its increased costs for which it is entitled to reimbursement under
this Agreement through the date of such sale and assignment.

70
77
ARTICLE XI. - DEFINITIONS

11.1. Defined Terms. The following terms are defined in the Sections
or subsections referenced opposite such terms:

"Acquisition Commitment Fee" 1.9(b)(ii)
"Acquisition Documents" 2.3(d)
"Acquisition Loan" 1.1(c)
"Acquisition Loan Commitment" 1.1(c)
"Affected Lender" 10.9
"Assignee" 9.8(a)
"Assignment and Acceptance" 9.8(a)(ii)
"Borrower" Preamble
"Commitment Fee Ratio" 1.12(d)
"Confidential Information" 9.9
"Daily Interest Amount" 1.12(d)
"Daily Interest Rate" 1.12(d)
"Daily Loan Balance" 1.12(d)
"EBITDA" Exhibit 4.2(b)
"Event of Default" 7.1
"Excess Cash Flow" Exhibit 1.8(d)
"Fixed Charge Coverage Ratio" Exhibit 4.2(b)
"Form 1001" 10.1(f)
"Form 4224" 10.1(f)
"Indemnified Person" 9.5
"Indemnified Liabilities" 9.5
"Interest Coverage Ratio" Exhibit 4.2(b)
"Interest Ratio" 1.12(d)
"Interest Settlement Date" 1.12(d)
"Lender" Preamble
"Lender Letter of Credit" 1.1(b)
"Letter of Credit Participation Agreement" 1.1(b)
"Letter of Credit Participation Fee" 1.9(b)
"Letter of Credit Participation Fee Ratio" 1.12(d)
"Leverage Ratio" Exhibit 4.2(b)
"Maximum Acquisition Loan Balance" 1.1(c)
"Maximum Revolving Loan Balance" 1.1(a)
"Originating Lender" 9.8
"Other Taxes" 10.1(b)
"Participant" 9.8(d)
"Permitted Liens" 5.1
"Replacement Lender" 10.9
"Restricted Payments" 5.11

71
78

"Revolving Commitment Fee" 1.9(b)(i)
"Revolving Loan Commitment" 1.1(a)
"Revolving Loan" 1.1(a)
"Settlement Date" 1.12(b)
"Taxes" 10.1(a)

In addition to the terms defined elsewhere in this Agreement, the following
terms have the following meanings:

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

"Acquisition Loan Maturity Date" means March 31, 2003.

"Acquisition Note" means a promissory note of the Borrower payable to
the order of a Lender, in substantially the form of Exhibit 11.1(a) hereto,
evidencing the indebtedness of the Borrower to such Lender resulting from the
Acquisition Loans made to the Borrower by such Lender.

"Acquisition Termination Date" means the earlier to occur of: (a) April
30, 2000; and (b) the date on which the Aggregate Acquisition Loan Commitment
shall terminate in accordance with the provisions of this Agreement.

"Adjusted EBITDA" means, as of any determination date, without
duplication, EBITDA of the Borrower and its Subsidiaries for the twelve-month
period ending on such date, except that Adjusted EBITDA for such twelve month
period shall include, without duplication, the Pro Forma EBITDA of any Target
acquired pursuant to an Acquisition permitted hereunder for the portion of such
period prior to the date of such Acquisition.

"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, by contract or otherwise. Without
limitation, any director, executive officer or beneficial owner of five percent
(5%) or more of the equity of a Person shall for the purposes of this
Agreement, be deemed to control the other Person. Notwithstanding the
foregoing, neither the Agent nor any Lender shall be deemed an "Affiliate" of
the Borrower or of any Subsidiary of the Borrower.

72
79
"Agent" means Antares in its capacity as agent for the Lenders
hereunder, and any successor agent.

"Agent-Related Persons" means Antares and any successor agent arising
under Section 8.9, together with their respective Affiliates, and the officers,
directors, employees, agents and attorneys-in-fact of such Persons and
Affiliates.

"Aggregate Acquisition Loan Commitment" means the combined Acquisition
Loan Commitments of the Lenders, which shall initially be in the amount of
$65,000,000, as such amount may be reduced from time to time pursuant to this
Agreement.

"Aggregate Commitment" means the combined Commitments of the Lenders,
which shall initially be in the amount of $80,000,000, as such amount may be
reduced from time to time pursuant to this Agreement.

"Aggregate Revolving Loan Commitment" means the combined Revolving Loan
Commitments of the Lenders, which shall initially be in the amount of
$15,000,000, as such amount may be reduced from time to time pursuant to this
Agreement.

"Antares" means Antares Leveraged Capital Corp., a Delaware corporation.

"Applicable Margin" means (a) from the Closing Date through June 30,
1999, with respect to Base Rate Loans, 1.00%, and with respect to LIBOR Rate
Loans, 2.75%, and thereafter, (b) with respect to LIBOR Rate Loans and Base
Rate Loans, respectively, the applicable LIBOR margin or Base Rate margin in
effect from time to time determined based upon the applicable Leverage Ratio
then in effect pursuant to the appropriate column under the table below:

------------------------------------------------------------------------------------------------------
Leverage Ratio Base Rate Margin LIBOR Margin
-------------- ---------------- ------------

3.50 to 1.0 or greater 1.00% 2.75%
------------------------------------------------------------------------------------------------------
3.00 to 1.0 or greater, but less than 0.75% 2.50%
3.50 to 1.0
------------------------------------------------------------------------------------------------------
less than 3.00 to 1.00 0.50% 2.25%
------------------------------------------------------------------------------------------------------

The Applicable Margin shall be adjusted from time to time on a quarterly
basis, commencing with the quarter ending June 30, 1999, upon delivery to the
Agent of the monthly financial statements required to be delivered pursuant to
Section 4.1 hereof for the period ending on the last day of such fiscal
quarter, accompanied by a written calculation of the Leverage Ratio

73
80
as of the end of the fiscal quarter for which such financial statements are
delivered certified on behalf of the Borrower by a Responsible Officer. If
such calculation indicates that the Applicable Margin, shall increase or
decrease, then on the first day of the month following the date of delivery of
such financial statements and written calculation, the Applicable Margin shall
be adjusted in accordance therewith; provided, however, that if the Borrower
shall fail to deliver any such financial statements for the last month of any
fiscal quarter by the date required pursuant to Section 4.1, then, effective as
of the first day of the month following the end of the fiscal month during
which such financial statements were to have been delivered, and continuing to
the first day of the month following the date (if ever) when such financial
statements and such written calculation are finally delivered, the Applicable
Margin shall be 1.00%, with respect to Base Rate Loans, and 2.75%, with respect
to LIBOR Rate Loans.

"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.

"Bankruptcy Code" means the Federal Bankruptcy Reform Act of 1978 (11
U.S.C. Section 101, et seq.), as amended and in effect from time to time and
the regulations issued from time to time thereunder.

"Base Rate" means, for any day, a rate of interest equal to the rate of
interest which is identified as the "Prime Rate" and normally published in the
Money Rates section of The Wall Street Journal (or, if such rate ceases to be
so published, as quoted from such other generally available and recognizable
source as the Agent may select).

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

"Borrowing" means a borrowing hereunder consisting of Loans made to the
Borrower on the same day by the Lenders pursuant to Article I.

"Borrowing Base" means, as of any date of determination, (a) Adjusted
EBITDA (based upon the most recent monthly financial statements then required
to have been delivered to the Agent pursuant to_subsection 4.1(b) but including
the Pro Forma EBITDA of all Targets acquired following the date of such
financial statements and on or prior to such date of determination) multiplied
by the Leverage Multiple less (b) total consolidated Indebtedness of the
Borrower and its Subsidiaries as of such date of determination (excluding the
Acquisition Loans, Revolving Loans and the Letter of Credit Participation
Liability).

"Borrowing Base Certificate" means a duly completed certificate of the
Borrower, in substantially the form of Exhibit 11.1(b) hereto.

"Business Day" means any day other than a Saturday, Sunday or other day
on which commercial banks in Chicago, Illinois or New York, New York are
authorized or required by law

74
81
to close and, if the applicable Business Day relates to any LIBOR Rate Loan, a
day on which dealings are carried on in the London interbank market.

"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 Lender or of any corporation controlling a Lender.

"Capital Expenditures" means, for any period and with respect to any
Person, the aggregate of all expenditures by such Person and its Subsidiaries
for the acquisition or leasing of fixed or capital assets or additions to fixed
or capital assets (including replacements, capitalized repairs and improvements
during such period) that should be capitalized under GAAP on a consolidated
balance sheet of such Person and its Subsidiaries.

"Capital Lease" means any leasing or similar arrangement which, in
accordance with GAAP, is classified as a capital lease.

"Capital Lease Obligations" means all monetary obligations of the
Borrower or any of its Subsidiaries under any Capital Leases.

"Cash Equivalents" means: (a) securities issued or fully guaranteed or
insured by the United States Government or any agency thereof having maturities
of not more than six (6) months from the date of acquisition; (b) certificates
of deposit, time deposits, repurchase agreements, reverse repurchase
agreements, or bankers' acceptances, having in each case a tenor of not more
than six (6) months, issued by any Lender, or by any U.S. commercial bank or
any branch or agency of a non-U.S. bank licensed to conduct business in the
U.S. having combined capital and surplus of not less than $250,000,000; (c)
commercial paper of an issuer rated at least A-1 by Standard & Poor's
Corporation or P-1 by ▇▇▇▇▇'▇ Investors Service Inc. and in either case having
a tenor of not more than three (3) months.

"Change of Control" means any of the following: (a) prior to the
consummation of a registered public offering of the Borrower's common stock,
the Permitted Holders shall cease to be the "beneficial owners" (within the
meaning of Rule 13d-3 under the Securities Exchange Act of 1934, as amended
(the "Exchange Act")) of at least 51% of the issued and outstanding shares of
capital stock of Borrower having the right to vote in the election of directors
of the Borrower under ordinary circumstances; (b) any Person or group of
persons (within the meaning of the Exchange Act) (other than the Permitted
Holders) shall acquire beneficial ownership (within the meaning of Rule 13d-3
under the Exchange Act) of 50% or more of the issued and outstanding shares of
capital stock of the Borrower having the right to vote for the election of
directors of the Borrower under ordinary circumstances; (c) during any period
of twelve consecutive calendar months, individuals who at the beginning of such
period constituted the board of directors of the Borrower (together with any
new directors whose election by the board of directors of the Borrower or whose
nomination for election by the stockholders of the Borrower was approved by a
vote of at least two-thirds of the directors then still in office who either
were directors at the

75
82
beginning of such period or whose elections or nomination for election was
previously so approved) cease for any reason other than death or disability to
constitute a majority of the directors then in office; (d) the Borrower (or any
Wholly-Owned Subsidiary of the Borrower) shall cease to own and control all of
the economic and voting rights associated with all of the outstanding capital
stock of any of its Subsidiaries; or (e) the occurrence of any event
constituting a "Change of Control", as defined in the Indenture, shall occur.

"Closing Date" means the date on which all conditions precedent set
forth in Section 2.1 are satisfied or waived by the Agent.

"Code" means the Internal Revenue Code of 1986, and regulations
promulgated thereunder.

"Collateral" means all property and interests in property and proceeds
thereof now owned or hereafter acquired by the Borrower as debtor and its
Subsidiaries in or upon which a Lien now or hereafter exists in favor of any
Lender or the Agent for the benefit of the Lenders, whether under this
Agreement or under any other documents executed by any such Persons and
delivered to the Agent.

"Collateral Documents" means, collectively, the Security Agreement, the
Mortgages, the Guaranty, the Pledge Agreement and all other security
agreements, pledge agreements, mortgages, deeds of trust, patent and trademark
assignments, lease assignments, guarantees and other similar agreements, and
all amendments, restatements, modifications or supplements thereof or thereto,
by or between any one or more of the Borrower or its Subsidiaries and any
Lender or the Agent for the benefit of the Lenders now or hereafter delivered
to the Lenders or the Agent pursuant to or in connection with the transactions
contemplated hereby, and all financing statements (or comparable documents now
or hereafter filed in accordance with the UCC or comparable law) against the
Borrower or its Subsidiaries as debtor in favor of any Lender or the Agent for
the benefit of the Lenders, as secured party.

"Commitment" means, for each Lender, the sum of its Acquisition Loan
Commitment and its Revolving Loan Commitment.

"Commitment Percentage" means, as to any Lender, the percentage
equivalent of such Lender's Acquisition Loan Commitment or Revolving Loan
Commitment divided by the Aggregate Acquisition Loan Commitment or Aggregate
Revolving Loan Commitment, as applicable.

"Contingent Obligation" means, as to any Person, any direct or indirect
liability, contingent or otherwise, of that Person: (i) with respect to any
indebtedness, lease, dividend or other obligation of another Person if the
primary purpose or intent of the Person incurring such liability, or the
primary effect thereof, is to provide assurance to the obligee of such
liability that such liability will be paid or discharged, or that any
agreements relating thereto will be complied with, or that the holders of such
liability will be protected (in whole or in part) against loss with

76
83
respect thereto; (ii) with respect to any letter of credit issued for the
account of that Person or as to which that Person is otherwise liable for
reimbursement of drawings; (iii) under any Rate Contracts; (iv) to make take-
or-pay or similar payments if required regardless of nonperformance by any
other party or parties to an agreement; or (v) for the obligations of another
through any agreement to purchase, repurchase or otherwise acquire such
obligation or any property constituting security therefor, to provide funds for
the payment or discharge of such obligation or to maintain the solvency,
financial condition or any balance sheet item or level of income of another
Person. The amount of any Contingent Obligation shall be equal to the amount
of the obligation so guaranteed or otherwise supported or, if not a fixed and
determined amount, the maximum amount so guaranteed or supported.

"Contractual Obligations" 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.

"Controlled Group" means the Borrower and all Persons (whether or not
incorporated) under common control or treated as a single employer with the
Borrower pursuant to Section 414(b), (c), (m) or (o) of the Code.

"Conversion Date" means any date on which the Borrower converts a Base
Rate Loan to a LIBOR Rate Loan or a LIBOR Rate Loan to a Base Rate Loan.

"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.

"Disposition" means (a) the sale, lease, conveyance or other disposition
of Property, other than sales or other dispositions expressly permitted under
subsections 5.2(a) and 5.2(c) and (b) the sale or transfer by the Borrower or
any Subsidiary of the Borrower of any equity securities issued by any
Subsidiary of the Borrower and held by such transferor Person.

"Disqualified Capital Stock" means any capital stock of the Borrower
which, by its terms (or by the terms of (i) any security into which it is
convertible or for which it is exchangeable or (ii) any agreement between the
Borrower and the holders of such capital stock), or upon the happening of any
event , matures or is mandatorily redeemable, pursuant to a sinking fund
obligation or otherwise, or is redeemable at the sole option of the holder
thereof, in whole or in part, on or prior to February 1, 2005; provided,
however, that any capital stock of the Borrower that would constitute
Disqualified Capital Stock solely because the holders thereof have the right to
require the Borrower to repurchase or redeem such capital stock upon the
occurrence of a "Change of Control" or an "Asset Sale" (as such terms are
defined in the Indenture as in effect on the Closing Date) shall not constitute
Disqualified Capital Stock if (i) the terms of such capital stock provide that
the Borrower may not repurchase or redeem such capital stock unless such
redemption or repurchase does not violate this Agreement and (ii) such capital
stock does

77
84
not otherwise constitute "Disqualified Capital Stock" within the meaning of the
Indenture as in effect on the date hereof.

"Dollars", "dollars" and "$" each mean lawful money of the United States
of America.

"Eligible Assignee" means any of: (a) a commercial bank organized under
the laws of the United States, or any State thereof; (b) a commercial bank
organized under the laws of any other country; or (c) a finance company,
insurance company or other financial institution or fund which is engaged in
making, purchasing or otherwise investing in commercial loans for its own
account in the ordinary course of its business.

"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), 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, placement, discharge, emission or release
(including intentional and unintentional, negligent and non-negligent, sudden
or non-sudden, accidental or non-accidental, placement, spills, leaks,
discharges, emissions or releases) of any Hazardous Material at, in, or from
Property, whether or not owned by the Borrower.

"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, 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, the Emergency Planning and
Community Right-to-Know Act.

"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and regulations promulgated thereunder.

"ERISA Affiliate" means any trade or business (whether or not
incorporated) under common control with the Borrower within the meaning of
Section 414(b), 414(c) or 414(m) of the Code.

"ERISA Event" means (a) a Reportable Event with respect to a Qualified
Plan or a Multiemployer Plan; (b) a withdrawal by the Borrower or any ERISA
Affiliate from a Qualified 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); (c) a complete or partial withdrawal by the Borrower or any ERISA
Affiliate from a Multiemployer Plan; (d) the filing of a notice of intent

78
85
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 Qualified Plan or Multiemployer Plan subject to Title IV of ERISA;
(e) a failure by the Borrower or any member of the Controlled Group to make
required contributions to a Qualified Plan or Multiemployer Plan; (f) 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 Qualified Plan or Multiemployer Plan; (g) the imposition of
any liability under Title IV of ERISA, other than PBGC premiums due but not
delinquent under Section 4007 of ERISA, upon the Borrower or any ERISA
Affiliate; (h) an application for a funding waiver or an extension of any
amortization period pursuant to Section 412 of the Code with respect to any
Plan; (i) a non-exempt prohibited transaction occurs with respect to any Plan
for which the Borrower or any Subsidiary of the Borrower may be directly or
indirectly liable; or (j) a violation of the applicable requirements of Section
404 or 405 of ERISA or the exclusive benefit rule under Section 401(a) of the
Code by any fiduciary or disqualified person with respect to any Plan for which
the Borrower or any member of the Controlled Group may be directly or
indirectly liable.

"Event of Loss" means, with respect to any Property, any of the
following: (a) any loss, destruction or damage of such Property; (b) any
pending or threatened institution of any proceedings for the condemnation or
seizure of such Property or for the exercise of any right of eminent domain; or
(c) any actual condemnation, seizure or taking, by exercise of the power of
eminent domain or otherwise, of such Property, or confiscation of such Property
or the requisition of the use of such Property.

"Exchange Act" means the Securities and Exchange Act of 1934, and
regulations promulgated thereunder.

"Exchangeable Preferred Stock" means, collectively, the 10% Exchangeable
Preferred Stock and the 13% Exchangeable Preferred Stock.

"10% Exchangeable Preferred Stock" means the Borrower's 10% Exchangeable
Preferred Stock, par value $.01 per share.

"13% Exchangeable Preferred Stock" means the Borrower's 13% Exchangeable
Preferred Stock, par value $.01 per share.

"13% Exchangeable Stock Documents" means the Securities Purchase
Agreement dated as of the Closing Date (the "Securities Purchase Agreement")
among the Borrower and Ares Leveraged Investment Fund, L.P. and S.V. Leveraged
Capital Partners, L.P., the shares of 13% Exchangeable Preferred Stock issued
pursuant to the Securities Purchase Agreement, the respective Registration
Rights Agreements contemplated by the Securities Purchase Agreement and the
other agreements entered into among the Borrower and the purchasers of the 13%
Exchangeable Preferred Stock pursuant to the Securities Purchase Agreement.

79
86
"Family Member" means, when used with reference to any natural Person,
such Person's spouse, siblings, parents, children, or other lineal descendants
(whether by adoptions or consanguinity), and shall mean a trust, the primary
beneficiary of which is the Person's spouse, siblings, parents, children, or
other lineal descendants (whether by adoption or consanguinity).

"Federal Funds Rate" means, for any period, the rate per annum set forth
in the weekly statistical release designated as H.15(519), or any successor
publication, published by the Federal Reserve Board (including any such
successor, "H.15(519)") for such day opposite the caption "Federal Funds
(Effective)". If on any relevant day such rate is not yet published in
H.15(519), the rate for such day will be the rate set forth in the daily
statistical release designated as the Composite 3:30 p.m. Quotations for U.S.
Government Securities, or any successor publication, published by the Federal
Reserve Bank of New York (including any such successor, the "Composite 3:30
p.m. Quotation") for such day under the caption "Federal Funds Effective Rate".
If on any relevant day the appropriate rate for such previous day is not yet
published in either H.15(519) or the Composite 3:30 p.m. Quotations, the rate
for such day will be the arithmetic mean as determined by the Agent of the
rates for the last transaction in overnight Federal funds arranged prior to
9:00 a.m. (New York time) on that day by each of three leading brokers of
Federal funds transactions in New York City selected by the Agent.

"Federal Reserve Board" means the Board of Governors of the Federal
Reserve System, or any entity succeeding to any of its principal functions.

"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
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.

"Guaranty" means that certain Guaranty, dated as of even date herewith,
in form and substance reasonably acceptable to the Agent and the Borrower, made
by each Subsidiary of the Borrower in favor of the Agent, for the benefit of
Agent and Lenders.

"Hazardous Materials" means all those substances which are regulated by,
or which may form the basis of liability under, any Environmental Law.

"Indebtedness" of any Person means, without duplication: (a) all
indebtedness for borrowed money; (b) all obligations issued, undertaken or
assumed as the deferred purchase

80
87
price of property or services (other than trade payables entered into in the
Ordinary Course of Business); (c) all reimbursement or payment obligations with
respect to letters of credit, surety bonds and other similar instruments; (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) all indebtedness referred to in clauses (a)
through (f) 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 contracts rights) owned by such Person,
even though such Person has not assumed or become liable for the payment of
such indebtedness; and (h) all Contingent Obligations described in clause (i)
of the definition thereof in respect of indebtedness or obligations of others
of the kinds referred to in clauses (a) through (g) above.

"Indenture" means that certain Amended and Restated Indenture dated as
of April 30, 1998, among the Borrower, as Issuer, the Subsidiary Guarantors
parties thereto and U.S. Trust Company of Texas, N.A., as Trustee, relating to
the Senior Notes, as such Indenture may be amended, restated or supplemented
from time to time to the extent not prohibited hereunder.

"Insolvency Proceeding" means (a) any case, action or proceeding 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; in each case (a) and (b) undertaken under U.S. Federal, State or
foreign law, including the Bankruptcy Code.

"Interest Payment Date" means, (a) with respect to any LIBOR Rate Loan
(other than a LIBOR Rate Loan having an Interest Period of six (6) months) the
last day of each Interest Period applicable to such Loan, (b) with respect to
any LIBOR Rate Loan having an Interest Period of six (6) months, the last day
of each three (3) month interval, and (c) with respect to Base Rate Loans, the
first day of each calendar quarter and each date a Base Rate Loan is converted
into a LIBOR Rate Loan.

"Interest Period" means, with respect to any LIBOR Rate Loan, the period
commencing on the Business Day the Loan is disbursed or continued or on the
Conversion Date on which the Loan is converted to the LIBOR Rate Loan and
ending on the date one, two, three or six months thereafter, as selected by the
Borrower in its Notice of Borrowing or Notice of Conversion/Continuation;
provided that:

(a) if any Interest Period pertaining to a LIBOR Rate Loan
would otherwise end on a day which is not a Business Day, that Interest
Period shall be extended to the

81
88
next succeeding 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 immediately preceding
Business Day;

(b) any Interest Period pertaining to a LIBOR Rate Loan 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;

(c) no Interest Period for any Acquisition Loan shall extend
beyond the Acquisition Loan Maturity Date and no Interest Period for any
Revolving Loan shall extend beyond the Revolving Termination Date; and

(d) no Interest Period applicable to an Acquisition Loan or
portion thereof shall extend beyond any date upon which is due any
scheduled principal payment in respect of the Acquisition Loans, unless
the aggregate principal amount of Acquisition Loans represented by Base
Rate Loans or by LIBOR Rate Loans having Interest Periods that will
expire on or before such date is equal to or in excess of the amount of
such principal payment.

"Lending Office" means, with respect to any Lender, the office or
offices of the Lender specified as its "Lending Office" opposite its name on
the applicable signature page hereto, or such other office or offices of the
Lender as it may from time to time notify the Borrower and the Agent.

"Letter of Credit Participation Liability" means, as to each Lender
Letter of Credit and each Letter of Credit Participation Agreement, all
reimbursement obligations and all other liabilities of the Borrower or any of
its Subsidiaries to the Agent and the Lenders in connection with such Lender
Letter of Credit or, in the case of any Letter of Credit Participation
Agreement, all such obligations and liabilities of the Borrower or any of its
Subsidiaries or of the Agent to the issuer of the letter of credit for which
the Letter of Credit Participation Agreement was issued, in any such case
whether contingent or otherwise, including with respect to any letter of
credit: (a) the amount available to be drawn or which may become available to
be drawn; (b) without duplication, all amounts which have been paid or made
available by the issuing bank or by the Agent under such letter of credit or
Letter of Credit Participation Agreement in respect thereof, in each instance,
to the extent not reimbursed; and (c) all unpaid interest, fees and expenses
associated with such letter of credit .

"Leverage Multiple" means 7.00 during the period from the Closing Date
through March 30, 1999; 6.75 during the period from March 31, 1999 through June
29, 1999; 6.50 during the period from June 30, 1999 through September 29, 1999;
6.25 during the period from September 30, 1999 through March 30, 2000; 6.00
during the period from March 31, 2000 through June 29, 2000; 5.75 during the
period from June 30, 2000 through September 29, 2000; 5.50 during the period
from September 30, 2000 through March 30, 2001; 5.25 during the period from
March 31,

82
89
2001 through June 29, 2001; 5.00 during the period from June 30, 2001 through
December 30, 2001; 4.75 during the period from December 31, 2001 through June
29, 2002; 4.50 during the period from June 30, 2002 through September 29, 2002;
and 4.25 thereafter.

"LIBOR" means, for each Interest Period, the offered rate per annum for
deposits of Dollars for the applicable Interest Period that appears on Telerate
Page 3750 as of 11:00 A.M. (London, England time) two (2) Business Days prior
to the first day in such Interest Period. If no such offered rate exists, such
rate will be the rate of interest per annum, as determined by the Agent
(rounded upwards, if necessary, to the nearest 1/16 of 1%) at which deposits of
Dollars in immediately available funds are offered at 11:00 A.M. (London,
England time) two (2) Business Days prior to the first day in such Interest
Period by major financial institutions reasonably satisfactory to the Agent in
the London interbank market for such Interest Period for the applicable
principal amount on such date of determination.

"Lien" means any mortgage, deed of trust, pledge, hypothecation,
assignment, charge or deposit arrangement, encumbrance, lien (statutory or
other) or preference, priority or other security interest or preferential
arrangement of any kind or nature whatsoever (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 UCC 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 a lease which is not a Capital Lease.

"Loan" means an extension of credit by a Lender to the Borrower pursuant
to Article I hereof, and may be a Base Rate Loan or a LIBOR Rate Loan.

"Loan Documents" means this Agreement, the Notes, the Collateral
Documents and all documents delivered to the Agent in connection therewith.

"Margin Stock" means "margin stock" as such term is defined in
Regulation G, T, U or X of the Federal Reserve Board.

"Majority Lenders" means at any time (a) Lenders then holding at least
fifty-one percent (51%) of the Aggregate Commitment then in effect or (b) if
the Commitments have been terminated, Lenders then having at least fifty-one
percent (51%) of the aggregate principal amount of the Loans then outstanding.

"Material Adverse Effect" means (a) a material adverse change in, or a
material adverse effect upon, the operations, business, properties, condition
(financial or otherwise) or prospects of the Borrower and its Subsidiaries
taken as a whole; (b) a material impairment of (i) the ability of the Borrower
to pay any of the Loans or any of the other Obligations in accordance with the
terms of this Agreement, (ii) the ability of any Subsidiary to pay any of its
obligations and liabilities to the Agent or any Lender under the Loan Documents
or (iii) the ability of the

83
90
Borrower to avoid any Event of Default; or (c) a material adverse effect upon
(i) the legality, validity, binding effect or enforceability of this Agreement,
any Note or any Collateral Document, or (ii) the perfection or priority of any
Lien granted to the Lenders or to the Agent for the benefit of the Lenders
under any of the Collateral Documents.

"Mortgage" means any deed of trust, mortgage or other document creating
a Lien on real property or any interest in real property.

"Multiemployer Plan" means a "multiemployer plan" (within the meaning of
Section 4001(a)(3) of ERISA) and to which Borrower or any member of the
Controlled Group 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 Issuance Proceeds" means, in respect of any issuance of debt or
equity, cash proceeds and the fair market value of non-cash proceeds received
by Borrower or any of its Subsidiaries in connection therewith, net of out-of-
pocket costs and expenses paid or incurred in connection therewith in favor of
any Person not an Affiliate of the Borrower.

"Net Proceeds" means proceeds in cash, checks or other cash equivalent
financial instruments (including Cash Equivalents) as and when received by the
Person making a Disposition, net of: (a) the direct costs relating to such
Disposition excluding amounts payable to the Borrower or any Affiliate of the
Borrower, (b) sale, use or other transaction taxes paid or payable as a result
thereof, (c) amounts required to be applied to repay principal, interest and
prepayment premiums and penalties on Indebtedness secured by a Lien on the
asset which is the subject of such Disposition, and (d) appropriate amounts to
be provided by the Borrower or any of its Subsidiaries, as the case may be, as
a reserve, in accordance with GAAP, against any liabilities associated with
such Disposition and retained by the Borrower or any Subsidiary, as the case
may be, after such Disposition. "Net Proceeds" shall also include proceeds
paid on account of any Event of Loss net of (i) all money actually applied to
repair, reconstruct or replace the damaged property or property affected by the
condemnation or taking, (ii) all of the costs and expenses incurred in
connection with the collection of such proceeds, award or other payments, and
(iii) any amounts retained by or paid or payable to parties having superior
rights to such proceeds, awards or other payments.

"Note" means any Revolving Note, Acquisition Note or Term Note and
"Notes" means all such Notes.

"Notice of Borrowing" means a notice given by the Borrower to the Agent
pursuant to Section 1.5, in substantially the form of Exhibit 11.1(c) hereto.

"Notice of Conversion/Continuation" means a notice given by the Borrower
to the Agent pursuant to Section 1.6, in substantially the form of Exhibit
11.1(d) hereto.

84
91
"Obligations" means all Loans, and other Indebtedness, advances, debts,
liabilities, obligations, covenants and duties owing by the Borrower to any
Lender, the Agent, or any other Person required to be indemnified, that arises
under any Loan Document, whether or not for the payment of money, whether
arising by reason of an extension of credit, loan, guaranty, indemnification or
in any other manner, whether direct or indirect (including those acquired by
assignment), absolute or contingent, due or to become due, now existing or
hereafter arising and however acquired.

"Ordinary Course of Business" means, in respect of any transaction
involving the Borrower or any Subsidiary of the Borrower, the ordinary course
of such Person's business, as conducted by any such Person in accordance with
past practice and undertaken by such Person in good faith and not for purposes
of evading any covenant or restriction in any Loan Document.

"Organization Documents" means, (a) 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, (b)
for any partnership, the partnership agreement and, if applicable, certificate
of limited partnership or (c) for any limited liability company, the operating
agreement and articles or certificate of formation.

"PBGC" means the Pension Benefit Guaranty Corporation or any entity
succeeding to any of its principal functions under ERISA.

"Permitted Holders" means the following Persons: Ares Leveraged
Investment Fund, L.P., Culligan Water Technologies, Inc., ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, SV
Capital Partners, L.P., Norwest Equity Partners V, The Food Fund II Limited
Partnership, ▇.▇. ▇▇▇▇▇ III, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, and ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, and any
of their respective Affiliates and Family Members, each of the foregoing
individually being a "Permitted Holder,"

"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 Borrower or any member of the Controlled Group sponsors or
maintains or to which the Borrower or any member of the Controlled Group makes,
is making or is obligated to make contributions.

"Pledge Agreement" means the Pledge Agreement, dated as of even date
herewith, in form and substance reasonably acceptable to the Agent and the
Borrower, made by the Borrower in favor of the Agent, for the benefit of the
Lenders.

"Pledged Collateral" has the meaning specified in the Pledge Agreement.

85
92
"Prior Indebtedness" means the indebtedness and obligations specified on
Schedule 11.1 hereto.

"Pro Forma EBITDA" means, with respect to any Target, EBITDA for such
Target for the most recent twelve (12) month period for which financial
statements are available at the time of determination thereof, adjusted by
verifiable expense reductions, including excess owner compensation, if any,
which are expected to be realized, in each case calculated by the Borrower and
approved by the Agent pursuant to Section 5.16.

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

"Qualified Plan" means a pension plan (as defined in Section 3(2) of
ERISA) intended to be tax-qualified under Section 401(a) of the Code and which
any member of the Controlled Group sponsors, maintains, or to which it makes,
is making or is obligated to make contributions, 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 period covering at least five (5)
plan years, but excluding any Multiemployer Plan.

"Rate Contracts" means swap agreements (as such term is defined in
Section 101 of the Bankruptcy Code) and any other agreements or arrangements
designed to provide protection against fluctuations in interest or currency
exchange rates.

"Reddy Ice Purchase Agreement" means the Stock Purchase Agreement dated
as of March 27, 1998 between the Borrower and Suiza Foods Corporation.

"Related Agreements" means the Reddy Ice Purchase Agreement, the Senior
Notes Documents and the Preferred Stock Documents.

"Related Transactions" means the transactions contemplated by the
Related Agreements.

"Reportable Event" means, as to any Plan, (a) any of the events set
forth in Section 4043(b) 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, (b) a withdrawal from a Plan described in
Section 4063 of ERISA, or (c) a cessation of operations described in Section
4062(e) of ERISA.

"Required Lenders" means, at any time (a) Lenders then holding at least
sixty-six and two-thirds percent (66-2/3%) of the Aggregate Commitment or (b)
if the Commitments have been terminated, Lenders then having at least sixty six
and two-thirds percent (66-2/3%) of the aggregate unpaid principal amount of
the Loans then outstanding.

"Requirement of Law" means, as to any Person, any law (statutory or
common), ordinance, treaty, rule, regulation, order, policy, other legal
requirement or determination of an

86
93
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 executive officer or the president
of the Borrower, or any other officer having substantially the same authority
and responsibility; or, with respect to compliance with financial covenants or
delivery of financial information, the chief financial officer or the treasurer
of the Borrower, or any other officer having substantially the same authority
and responsibility.

"Revolving Note" means a promissory note of the Borrower payable to the
order of a Lender and otherwise substantially the form of Exhibit 11.1(e)
hereto, evidencing indebtedness of the Borrower under the Revolving Loan
Commitment of such Lender.

"Revolving Termination Date" means the earlier to occur of: (a) March
31, 2003; and (b) the date on which the Aggregate Revolving Loan Commitment
shall terminate in accordance with the provisions of this Agreement.

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

"Security Agreement" means the Security Agreement, dated as of even date
herewith, in form and substance reasonably satisfactory to the Agent and the
Borrower, made by the Borrower and each Subsidiary of the Borrower in favor of
the Agent for the benefit of the Lenders.

"Senior Notes" means those Series A 9 3/4% Senior Notes due February 1,
2005 in the aggregate principal amount of $270,000,000 issued on or prior to
the Closing Date pursuant to the Indenture, and any substantially identical
Series B 9 3/4% Senior Notes due February 1, 2005 which are issued under the
Indenture in exchange for such Series A 9 3/4% Senior Notes pursuant to the
Registration Rights Agreement contemplated by the Indenture.

"Senior Notes Documents" means the Indenture, the Senior Notes, the
respective Purchase Agreements dated as of January 22, 1998 and the Closing
Date between the Borrower and the initial purchaser of the Senior Notes, the
Registration Rights Agreement contemplated by the Indenture and the other
agreements executed pursuant to the foregoing.

"Solvent" means, as to any Person at any time, that (a) the fair value
of the Property of such Person is greater than the amount of such Person's
liabilities (including disputed, contingent and unliquidated liabilities) as
such value is established and liabilities evaluated for purposes of Section
101(31) of the Bankruptcy Code and, in the alternative, for purposes of the
Uniform Fraudulent Transfer Act; (b) the present fair saleable value of the
Property of such Person is not less than the amount that will be required to
pay the probable liability of such Person on its debts as they become absolute
and matured; (c) such Person is able to realize upon its Property and pay its
debts and other liabilities (including disputed, contingent and unliquidated
liabilities) as they

87
94
mature in the normal course of business; (d) such Person does not intend to,
and does not believe that it will, incur debts or liabilities beyond such
Person's ability to pay as such debts and liabilities mature; and (e) such
Person is not engaged in business or a transaction, and is not about to engage
in business or a transaction, for which such Person's property would constitute
unreasonably small capital.

"Subordinated Indebtedness" means all Indebtedness of the Borrower or
any of its Subsidiaries which is subordinated in right of payment to the
Obligations in a manner satisfactory to the Agent and the Required Lenders.

"Subsidiary" of a Person means any corporation, association, limited
liability company, partnership, joint venture or other business entity of which
more than fifty percent (50%) of the voting stock 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.

"Target" means any other Person or business unit or asset group of any
other Person acquired or proposed to be acquired in an Acquisition.

"UCC" means the Uniform Commercial Code as in effect from time to time
in the State of Illinois.

"Unfinanced Capital Expenditures" means Capital Expenditures financed
with the proceeds of Indebtedness (excluding Revolving Loans).

"Unfunded Pension Liabilities" 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 by the Plan's
actuaries for funding the Plan pursuant to section 412 for the applicable plan
year.

"United States" and "U.S." each means the United States of America.

"Wholly-Owned Subsidiary" means any corporation in which (other than
directors' qualifying shares required by law) 100% of the capital stock of each
class having ordinary voting power, and 100% of the capital stock 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 Borrower, or by one or more
of the other Wholly-Owned Subsidiaries of the Borrower, or both.

"Withdrawal Liabilities" means, as of any determination date, the
aggregate amount of the liabilities, if any, pursuant to Section 4201 of ERISA
if the Controlled Group made a complete withdrawal from all Multiemployer Plans
and any increase in contributions pursuant to Section 4243 of ERISA.

88
95
11.2. Other Interpretive Provisions.

(a) Defined Terms. Unless otherwise specified herein or therein,
all terms defined in this Agreement shall have the defined meanings when used
in any certificate or other document made or delivered pursuant hereto. The
meaning of defined terms shall be equally applicable to the singular and plural
forms of the defined terms. Terms (including uncapitalized terms) not
otherwise defined herein and that are defined in the UCC shall have the
meanings therein described.

(b) The Agreement. The words "hereof", "herein", "hereunder" and
words of similar import when used in this Agreement shall refer to this
Agreement as a whole and not to any particular provision of this Agreement; and
subsection, section, schedule and exhibit references are to this Agreement
unless otherwise specified.

(c) Certain Common Terms. The term "documents" includes any and
all instruments, documents, agreements, certificates, indentures, notices and
other writings, however evidenced. The term "including" is not limiting and
means "including without limitation."

(d) Performance; Time. Whenever any performance obligation
hereunder (other than a payment obligation) shall be stated to be due or
required to be satisfied on a day other than a Business Day, such performance
shall be made or satisfied on the next succeeding Business Day. 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." If
any provision of this Agreement refers to any action taken or to be taken by
any Person, or which such Person is prohibited from taking, such provision
shall be interpreted to encompass any and all means, direct or indirect, of
taking, or not taking, such action.

(e) Contracts. Unless otherwise expressly provided herein,
references to agreements and other contractual instruments, including this
Agreement and the other Loan Documents, shall be deemed to include all
subsequent amendments thereto, restatements thereof and other modifications and
supplements thereto which are in effect from time to time, but only to the
extent such amendments and other modifications are not prohibited by the terms
of any Loan Document.

(f) Laws. 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.

11.3. 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.

(b) References herein to "fiscal year", "fiscal quarter" and "fiscal
month" refer to such fiscal periods of the Borrower.

89
96
[Balance of page intentionally left blank; signature page follows]

90
97
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their duly authorized officers as of the day and
year first above written.

PACKAGED ICE, INC.

By:
------------------------------
Title:
---------------------------
Borrower's FEIN:
----------------
Address for notices:

---------------------------------

---------------------------------
Attn:
---------------------------
Facsimile:
-----------------------
Address for Wire Transfers:

---------------------------------

---------------------------------
ANTARES LEVERAGED CAPITAL CORP.,
as Agent and as a Lender

By:
------------------------------
Title: Director

Address for notices:

▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇

Address for payments:

Antares Leveraged Capital Corp.
Account # 4070-6016
Citibank N.A., NY
ABA # ▇▇▇▇▇▇▇▇▇
Reference: Packaged Ice, Inc.
Please advise ▇▇▇ ▇▇▇▇▇▇▇▇▇ at
(▇▇▇) ▇▇▇-▇▇▇▇ upon receipt

98
SCHEDULE 1.1(a)
REVOLVING LOAN COMMITMENTS

Antares Leveraged Capital Corp. $15,000,000

99
SCHEDULE 1.1(c)
ACQUISITION LOAN COMMITMENTS

Antares Leveraged Capital Corp. $65,000,000

80,000,000 CREDIT FACILITY CREDIT AGREEMENT DATED AS OF APRIL 30, 1998 BY AND AMONG PACKAGED ICE, INC., AS BORROWER

Document Metadata

Document Metadata

Table of Contents