AMENDED AND RESTATED CREDIT AGREEMENT DATED AS OF NOVEMBER 1, 2005 by and among PENHALL INTERNATIONAL CORP., PENHALL COMPANY, PENHALL LEASING, L.L.C., CAPITOL DRILLING SUPPLIES, INC. and BOB MACK CO., INC., as Borrowers and THE OTHER PERSONS PARTY...

Exhibit 10.1

AMENDED AND RESTATED CREDIT AGREEMENT

DATED AS OF NOVEMBER 1, 2005

by and among

PENHALL INTERNATIONAL CORP.,

PENHALL COMPANY,

PENHALL LEASING, L.L.C.,

CAPITOL DRILLING SUPPLIES, INC.

and

▇▇▇ ▇▇▇▇ CO., INC., as Borrowers

and

THE OTHER PERSONS PARTY HERETO THAT ARE

DESIGNATED AS CREDIT PARTIES

and

GENERAL ELECTRIC CAPITAL CORPORATION

as Agent, L/C Issuer and a Lender

and

THE OTHER FINANCIAL INSTITUTIONS PARTY HERETO

as Lenders

TABLE OF CONTENTS

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INDEX OF APPENDICES

AMENDED AND RESTATED CREDIT AGREEMENT

This AMENDED AND RESTATED CREDIT AGREEMENT is dated as of November 1, 2005 and entered into by and among PENHALL INTERNATIONAL CORP., an Arizona corporation (“Holdings”), PENHALL COMPANY, a California corporation (“Penhall”), PENHALL LEASING, L.L.C., a California limited liability company (“Penhall Leasing”), CAPITOL DRILLING SUPPLIES, INC., an Indiana corporation (“Capitol”) and ▇▇▇ ▇▇▇▇ CO., INC., a California corporation  (“▇▇▇ ▇▇▇▇”) (Holdings, Penhall, Penhall Leasing, Capitol and ▇▇▇ ▇▇▇▇ are sometimes referred to herein as the “Borrowers” and individually as a “Borrower”), the other persons designated as “Credit Parties” on the signature pages hereof, the financial institutions who are or hereafter become parties to this Agreement as Lenders, and GENERAL ELECTRIC CAPITAL CORPORATION, a Delaware corporation (in its individual capacity “GE Capital”), as the initial L/C Issuer and as Agent.

R E C I T A L S:

WHEREAS,  Borrowers (other than Capitol (the “Existing Borrowers”)) are parties to that certain Credit Agreement, dated as of May 22, 2003, as amended by Amendment No. 1 dated as of July 2, 2003, Amendment No. 2, dated as of October 2, 2003, Amendment No. 3, dated as of October 28, 2003, Amendment No. 4, dated as of June 7, 2004, and Amendment No. 5, dated as of November 30, 2004, among the Borrowers, the Lenders (as defined therein) and Agent (as amended, modified, or supplemented to the date hereof, the “Existing Credit Agreement”); and

WHEREAS, Capitol wishes to join the Credit Agreement as a Borrower effective on the Amendment Effective Date;

WHEREAS, Borrowers desire that Lenders extend a revolving credit facility to Borrowers to (i) refinance existing indebtedness of Borrowers under the Existing Credit Agreement, (ii) redeem all of the issued and outstanding shares of Senior Preferred Stock (as defined hereinafter), (iii) provide working capital financing for Borrowers and (iv) provide funds for other general corporate purposes of Borrowers; and

WHEREAS, in connection therewith, the parties hereto desire to amend and restate the terms and provisions of the Existing Credit Agreement in the form hereof; and

WHEREAS, Existing Borrowers desire to continue to secure and Capitol desires to secure all of their Obligations (as hereinafter defined) under the Loan Documents (as hereinafter defined) by granting to Agent, for the benefit of Agent and Lenders, a security interest in and lien upon substantially all of their existing and after-acquired personal and real property; and

WHEREAS, Existing Borrowers are willing to continue to pledge to Agent and Capitol to pledge to Agent, for the benefit of Agent and Lenders, all of the Stock of their wholly owned Subsidiaries to secure the Obligations; and

WHEREAS, each Credit Party has agreed to continue to secure all of the Obligations by granting to Agent, for the benefit of Agent and Lenders, a security interest in and lien upon all of their existing and after-acquired personal and real property; and

WHEREAS, each Existing Borrower is willing to continue to guaranty and Capitol is willing to guaranty all of the Obligations of each other Borrower in accordance with the provisions of Section 10; and

WHEREAS, each Credit Party that is not a Borrower under this Agreement is willing to guaranty all of the Obligations of Borrowers; and

WHEREAS, all capitalized terms herein shall have the meanings ascribed thereto in Annex A hereto which is incorporated herein by reference.

NOW, THEREFORE, in consideration of the premises and the agreements, provisions and covenants herein contained, Borrowers, Credit Parties, Lenders and Agent agree that subject to the terms and conditions hereof, the Existing Credit Agreement be and hereby is amended and restated in its entirety as this Agreement:

SECTION 1.

AMOUNTS AND TERMS OF LOANS

1.1.         Loans.  Subject to the terms and conditions of this Agreement and in reliance upon the representations and warranties of Borrowers and the other Credit Parties contained herein:

(a)           Revolving Loans.

(i)            Each Revolving Lender agrees, severally and not jointly, to make available to Borrowers from time to time until the Commitment Termination Date its Pro Rata Share of advances (each a “Revolving Credit Advance”) requested by Borrower Representative on behalf of the Borrowers hereunder.  The Pro Rata Share of the Revolving Loan of any Revolving Lender (including, without duplication, Swing Line Loans) shall not at any time exceed its separate Revolving Loan Commitment.  Revolving Credit Advances may be repaid and reborrowed; provided, that the amount of any Revolving Credit Advance to be made at any time shall not exceed Borrowing Availability.  Borrowing Availability may be further reduced by Reserves imposed by Agent in its reasonable credit judgment.  Moreover, the sum of the Revolving Loan and Swing Line Loan outstanding to any Borrower shall not exceed at any time that Borrower’s separate Borrowing Base.  All Revolving Loans shall be repaid in full on the Commitment Termination Date.  Each Borrower shall execute and deliver to each Revolving Lender a note to evidence the Revolving Loan Commitment of that Revolving Lender.  Each note shall be in the maximum principal amount of the Revolving Loan Commitment of the applicable Revolving Lender, dated the Amendment Effective Date and substantially in the form of Exhibit 1.1(a)(i) (each as amended, modified, extended, substituted or replaced from time to time, a “Revolving Note” and, collectively, the “Revolving Notes”).  Other than pursuant to Section 1.1(a)(ii), if at any time the outstanding Revolving Loans (including the Swing Line Loans) exceed the Borrowing Base or the outstanding balance of the Revolving Loan of any Borrower (including the Swing Line Loans advanced to that Borrower) exceeds that Borrower’s separate Borrowing Base (any such excess Revolving Loans are herein referred to collectively as “Overadvances”), Lenders shall not be obligated to make Revolving Credit Advances, no additional Letters of Credit shall be issued and, except as provided in Section 1.1(a)(ii) below, Revolving Loans must be repaid immediately and Letters of Credit cash collateralized in an amount sufficient to eliminate any Overadvances.  Furthermore, if, at any time, the outstanding balance of the Revolving Loan of any Borrower (including, without duplication, Swing Line Loans) exceeds that Borrower’s separate Borrowing Base (including, without duplication, Swing Line Loans), the applicable Borrower shall immediately repay its Revolving Credit Advances in the amount of such excess (and, if necessary, shall provide cash collateral for its Letter of Credit Obligations).  All Overadvances shall constitute Index Rate Loans and shall bear interest at the Default Rate.  Revolving Credit Advances which are to be made as Index Rate Loans may be requested in any amount with one (1) Business Day’s prior written notice required for funding requests equal to or greater than $5,000,000.  For funding requests for such Loans less than $5,000,000, written notice must be provided by 1:00 p.m. (New York

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time) on the Business Day on which such Revolving Credit Advance is to be made.  All requests for Revolving Credit Advances that are to be made as LIBOR Loans require three (3) Business Days’ prior written notice. Written notices for funding requests shall be in the form attached as Exhibit 1.1(a)(ii) (“Notice of Revolving Credit Advance”).  Each Revolving Credit Advance to Penhall Leasing shall be in a minimum amount of $250,000.  Each Revolving Credit Advance to Holdings, Penhall, Capitol and ▇▇▇ ▇▇▇▇ shall be in a minimum amount of $100,000.

(ii)           If Borrower Representative on behalf of Borrowers requests that Revolving Lenders make, or permit to remain outstanding any Overadvances, Agent may, in its sole discretion, elect to make, or permit to remain outstanding such Overadvances; provided, however, that Agent may not cause Revolving Lenders to make, or permit to remain outstanding, (a) aggregate Revolving Loans (including, without duplication, Swing Line Loans) in excess of the Maximum Amount or (b) Overadvances in an aggregate amount in excess of $5,000,000.  If an Overadvance is made, or permitted to remain outstanding, pursuant to the preceding sentence, then all Revolving Lenders shall be bound to make, or permit to remain outstanding such Overadvance based upon their Pro Rata Shares of the Revolving Loan Commitments in accordance with the terms of this Agreement.  If an Overadvance remains outstanding for more than ninety (90) days during any one hundred eighty (180) day period, Revolving Loans must be repaid immediately in an amount sufficient to eliminate all of such Overadvances.  Furthermore, holders of a majority of the Revolving Loan Commitment may prospectively revoke Agent’s ability to make or permit Overadvances by written notice to Agent.  Any Overadvance may be made as a Swing Line Advance.

(b)           Loan Balance.  Immediately prior to the Amendment Effective Date, the outstanding principal balance of the Revolving Credit Advances under and as defined in the Existing Credit Agreement is $6,000,000.  The Revolving Credit Advance to be made on the Amendment Effective Date (together with the outstanding principal amount of the “Revolving Credit Advances” under (and as such term is defined in) the Existing Credit Agreement) shall not exceed $17,000,000.

(c)           Swing Line Facility.

(i)            Agent shall notify the Swing Line Lender upon Agent’s receipt of any Notice of Revolving Credit Advance.  Subject to the terms and conditions hereof, the Swing Line Lender may, in its discretion, make available from time to time until the Commitment Termination Date advances (each, a “Swing Line Advance”) in accordance with any such notice.  The provisions of this Section 1.1(c) shall not relieve Revolving Lenders of their obligations to make Revolving Credit Advances under Section 1.1(a); provided that if the Swing Line Lender makes a Swing Line Advance pursuant to any such notice, such Swing Line Advance shall be in lieu of any Revolving Credit Advance that otherwise may be made by Revolving Lenders pursuant to such notice.  Except as provided in Section 1.1(a)(ii) above, no Swing Line Advance shall be made if (A) such Swing Line Advance, when added to the other Swing Line Advances then outstanding, shall exceed the Swing Line Commitment or (B) such Swing Line Advance shall exceed Borrowing Availability (the lesser of (A) and (B), “Swing Line Availability”).  Moreover, except for Overadvances, the Swing Line Loan outstanding to any Borrower shall not exceed at any time that Borrower’s separate Borrowing Base less the Revolving Loan outstanding to such Borrower.  Until the Commitment Termination Date, Borrowers may from time to time borrow, repay and reborrow under this Section 1.1(c).  Each Swing Line Advance shall be made pursuant to a Notice of Revolving Credit Advance delivered by Borrower Representative on behalf of the applicable Borrower to Agent in accordance with Section 1.1(a).  Unless the Swing Line Lender has received at least one (1) Business Day’s prior written notice from Requisite Lenders instructing it not to make a Swing Line Advance, the Swing Line Lender shall, notwithstanding the failure of any condition precedent set forth in Section 7.2, be entitled to fund that Swing Line Advance, and to have each Revolving Lender make Revolving Credit Advances in accordance with Section 1.1(c)(iii) or purchase participating interests in accordance with

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Section 1.1(c)(iv).  Notwithstanding any other provision of this Agreement or the other Loan Documents, the Swing Line Loan shall constitute an Index Rate Loan.  Borrowers shall repay the aggregate outstanding principal amount of the Swing Line Loan upon demand therefor by Agent. The entire unpaid balance of the Swing Line Loan and all other noncontingent Obligations shall be immediately due and payable in full in immediately available funds on the Commitment Termination Date if not sooner paid in full.  Each Swing Line Advance shall be in a minimum amount of $250,000.

(ii)           Each Borrower shall execute and deliver to the Swing Line Lender a promissory note to evidence the Swing Line Commitment.  Each note shall be in the principal amount of the Swing Line Commitment of the Swing Line Lender, dated the Amendment Effective Date and substantially in the form of Exhibit 1.1(c) (each as amended, modified, extended, substituted or replaced from time to time, a “Swing Line Note” and, collectively the “Swing Line Notes”).  Each Swing Line Note shall represent the obligation of each Borrower to pay the amount of the Swing Line Commitment or, if less, the aggregate unpaid principal amount of all Swing Line Advances made to such Borrower together with interest thereon as prescribed in Section 1.2.

(iii)          The Swing Line Lender, at any time and from time to time in its sole and absolute discretion (but no less frequently than weekly), may on behalf of any Borrower (and each Borrower hereby irrevocably authorizes the Swing Line Lender to so act on its behalf) request each Revolving Lender (including the Swing Line Lender) to make a Revolving Credit Advance to each Borrower (which shall be an Index Rate Loan) in an amount equal to that Revolving Lender’s Pro Rata Share of the principal amount of the applicable Borrower’s Swing Line Loan (the “Refunded Swing Line Loan”) outstanding on the date such notice is given.  Unless any of the events described in Sections 6.1(f) and 6.1(g) has occurred (in which event the procedures of Section 1.1(c)(iv) shall apply) and regardless of whether the conditions precedent set forth in this Agreement to the making of a Revolving Credit Advance are then satisfied, each Revolving Lender shall disburse directly to Agent, its Pro Rata Share of a Revolving Credit Advance on behalf of the Swing Line Lender, prior to 3:00 p.m. (New York time), in immediately available funds on the Business Day next succeeding the date that notice is given.  The proceeds of those Revolving Credit Advances shall be immediately paid to the Swing Line Lender and applied to repay the Refunded Swing Line Loan of the applicable Borrower.

(iv)          If, prior to refunding a Swing Line Loan with a Revolving Credit Advance pursuant to Section 1.1(c)(iii), one of the events described in Sections 6.1(f) or 6.1(g) has occurred, then, subject to the provisions of Section 1.1(c)(v) below, each Revolving Lender shall, on the date such Revolving Credit Advance was to have been made for the benefit of the applicable Borrower, purchase from the Swing Line Lender an undivided participation interest in the Swing Line Loan to such Borrower in an amount equal to its Pro Rata Share (determined with respect to Revolving Loans) of such Swing Line Loan.  Upon request, each Revolving Lender shall promptly transfer to the Swing Line Lender, in immediately available funds, the amount of its participation interest.

(v)           Each Revolving Lender’s obligation to make Revolving Credit Advances in accordance with Section 1.1(c)(iii) and to purchase participation interests in accordance with Section 1.1(c)(iv) shall be absolute and unconditional and shall not be affected by any circumstance, including (A) any setoff, counterclaim, recoupment, defense or other right that such Revolving Lender may have against the Swing Line Lender, any Borrower or any other Person for any reason whatsoever; (B) the occurrence or continuance of any Default or Event of Default; (C) any inability of any Borrower to satisfy the conditions precedent to borrowing set forth in this Agreement at any time or (D) any other circumstance, happening or event whatsoever, whether or not similar to any of the foregoing.  Swing Line Lender shall be entitled to recover, on demand, from each Revolving Lender the amounts required pursuant to Sections 1.1.(c)(iii) or 1.1(c)(iv), as the case may be.  If any Revolving Lender does not make available such amounts to Agent or the Swing Line Lender, as applicable, the Swing Line Lender shall be

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entitled to recover, on demand, such amount on demand from such Revolving Lender, together with interest thereon for each day from the date of non-payment until such amount is paid in full at the Federal Funds Rate for the first two (2) Business Days and at the Index Rate thereafter.

(vi)          Immediately prior to the Amendment Effective Date, the outstanding principal balance of the Swing Line Advances under and as defined in the Existing Credit Agreement is $0.

(d)           Letters of Credit.  The Revolving Loan Commitment may, in addition to advances under the Revolving Loan, be utilized, upon the request of Borrower Representative on behalf of the applicable Borrower, for the issuance of Letters of Credit.  Immediately upon the issuance by an L/C Issuer of a Letter of Credit, and without further action on the part of Agent or any of the Lenders, each Revolving Lender shall be deemed to have purchased from such L/C Issuer a participation in such Letter of Credit (or in its obligation under a risk participation agreement with respect thereto) equal to such Revolving Lender’s Pro Rata Share of the aggregate amount available to be drawn under such Letter of Credit.

(i)            Maximum Amount.  The aggregate amount of Letter of Credit Obligations with respect to all Letters of Credit outstanding at any time shall not exceed $35,000,000 (“L/C Sublimit”).

(ii)           Reimbursement.  Borrowers shall be irrevocably and unconditionally obligated forthwith without presentment, demand, protest or other formalities of any kind (including for purposes of Section 10), to reimburse any L/C Issuer on demand in immediately available funds for any amounts paid by such L/C Issuer with respect to a Letter of Credit, including all reimbursement payments, Fees, Charges, costs and expenses paid by such L/C Issuer.  Borrowers hereby authorize and direct Agent, at Agent’s option, to debit Borrowers’ account (by increasing the outstanding principal balance of the Revolving Credit Advances) in the amount of any payment made by an L/C Issuer with respect to any Letter of Credit.  All amounts paid by an L/C Issuer with respect to any Letter of Credit that are not immediately repaid by Borrowers with the proceeds of a Revolving Credit Advance or otherwise shall bear interest at the interest rate applicable to Revolving Loans which are Index Rate Loans plus, at the election of Agent or Requisite Lenders, an additional two percent (2.00%) per annum.  Each Revolving Lender agrees to fund its Pro Rata Share of any Revolving Loan made pursuant to this Section 1.1(d)(ii).  In the event Agent elects not to debit Borrowers’ account and Borrowers fail to reimburse the L/C Issuer in full on the date of any payment in respect of a Letter of Credit, Agent shall promptly notify each Revolving Lender of the amount of such unreimbursed payment and the accrued interest thereon and each Revolving Lender, on the next Business Day prior to 3:00 p.m. (New York time), shall deliver to Agent an amount equal to its Pro Rata Share thereof in same day funds.  Each Revolving Lender hereby absolutely and unconditionally agrees to pay to the L/C Issuer upon demand by the L/C Issuer such Revolving Lender’s Pro Rata Share of each payment made by the L/C Issuer in respect of a Letter of Credit and not immediately reimbursed by Borrowers or satisfied through a debit of Borrowers’ account.  Each Revolving Lender acknowledges and agrees that its obligations pursuant to this subsection in respect of Letters of Credit are absolute and unconditional and shall not be affected by any circumstance whatsoever, including setoff, counterclaim, the occurrence and continuance of a Default or an Event of Default or any failure by Borrowers to satisfy any of the conditions set forth in Section 7.2.  If any Revolving Lender fails to make available to the L/C Issuer the amount of such Revolving Lender’s Pro Rata Share of any payments made by the L/C Issuer in respect of a Letter of Credit as provided in this Section 1.1(d)(ii), the L/C Issuer shall be entitled to recover such amount on demand from such Revolving Lender together with interest at the Index Rate.

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(iii)          Request for Letters of Credit.  Borrower Representative shall give Agent at least three (3) Business Days’ prior written notice specifying the date a Letter of Credit is requested to be issued, the amount and the name and address of the beneficiary, a description of the transactions proposed to be supported thereby and the name of the Borrower for whose account such Letter of Credit is to be issued.  If Agent informs Borrower Representative that the L/C Issuer cannot issue the requested Letter of Credit directly, such Borrower Representative may request that L/C Issuer arrange for the issuance of the requested Letter of Credit under a risk participation agreement with another financial institution reasonably acceptable to Agent, L/C Issuer and Borrower Representative.  The issuance of any Letter of Credit under this Agreement shall be subject to the conditions that the Letter of Credit (i) supports a transaction entered into in the ordinary course of business of Borrowers and (ii) is in a form, is for an amount and contains such terms and conditions as are reasonably satisfactory to the L/C Issuer and, in the case of standby letters of credit, Agent.  The initial notice requesting the issuance of a Letter of Credit shall be accompanied by the form of the Letter of Credit and the Master Standby Agreement or Master Documentary Agreement, as applicable, and an application for a letter of credit, if any, then required by the L/C Issuer completed in a manner satisfactory to such L/C Issuer.  If any provision of any application or reimbursement agreement is inconsistent with the terms of this Agreement, then the provisions of this Agreement, to the extent of such inconsistency, shall control.

(iv)          Expiration Dates of Letters of Credit.  The expiration date of each Letter of Credit shall be on a date which is not later than the earlier of (a) one year from its date of issuance or (b) the thirtieth (30th) day prior to the date set forth in clause (a) of the definition of the term Commitment Termination Date. Notwithstanding the foregoing, a Letter of Credit may provide for automatic extensions of its expiration date for one (1) or more successive one (1) year periods provided that the L/C Issuer has the right to terminate such Letter of Credit on each such annual expiration date and no renewal term may extend the term of the Letter of Credit to a date that is later than the thirtieth (30th) day prior to the date set forth in clause (a) of the definition of the term Commitment Termination Date.  The L/C Issuer may elect not to renew any such Letter of Credit and, upon direction by Agent or Requisite Lenders, shall not renew any such Letter of Credit at any time during the continuance of an Event of Default, provided that, in the case of a direction by Agent or Requisite Lenders, the L/C Issuer receives such directions prior to the date notice of non-renewal is required to be given by the L/C Issuer and the L/C Issuer has had a reasonable period of time to act on such notice.

(v)           Obligations Absolute.  The obligation of Borrowers to reimburse the L/C Issuer, Agent and Lenders for payments made in respect of Letters of Credit issued by the L/C Issuer shall be unconditional and irrevocable and shall be paid under all circumstances strictly in accordance with the terms of this Agreement, including the following circumstances: (a) any lack of validity or enforceability of any Letter of Credit; (b) any amendment or waiver of or any consent or departure from all or any of the provisions of any Letter of Credit or any Loan Document; (c) the existence of any claim, set-off, defense or other right which Borrowers, any of their Subsidiaries or Affiliates or any other Person may at any time have against any beneficiary of any Letter of Credit, Agent, any L/C Issuer, any Lender or any other Person, whether in connection with this Agreement, any other Loan Document or any other related or unrelated agreements or transactions; (d) any draft or other document presented under any Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect; (e) payment under any Letter of Credit against presentation of a draft or other document that does not substantially comply with the terms of such Letter of Credit; or (f) any other act or omission to act or delay of any kind of any L/C Issuer, Agent, any Lender or any other Person or any other event or circumstance whatsoever that might, but for the provisions of this Section 1.1(d)(v), constitute a legal or equitable discharge of Borrowers’ obligations hereunder.

(vi)          Obligations of L/C Issuers.  Each L/C Issuer (other than GE Capital) hereby agrees that it will not issue a Letter of Credit hereunder until it has provided Agent with written

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notice specifying the amount and intended issuance date of such Letter of Credit and Agent has returned a written acknowledgment of such notice to L/C Issuer.  Each L/C Issuer (other than GE Capital) further agrees to provide to Agent:  (a) a copy of each Letter of Credit issued by such L/C Issuer promptly after its issuance; (b) a weekly report summarizing available amounts under Letters of Credit issued by such L/C Issuer, the dates and amounts of any draws under such Letters of Credit, the effective date of any increase or decrease in the face amount of any Letters of Credit during such week and the amount of any unreimbursed draws under such Letters of Credit; and (c) such additional information reasonably requested by Agent from time to time with respect to the Letters of Credit issued by such L/C Issuer.  Without limiting the generality of the foregoing, it is expressly understood and agreed by Borrowers that the absolute and unconditional obligation of Borrowers to Agent and Lenders hereunder to reimburse payments made under a Letter of Credit will not be excused by the gross negligence or willful misconduct of the L/C Issuer.  However, the foregoing shall not be construed to excuse an L/C Issuer from liability to Borrowers to the extent of any direct damages (as opposed to consequential damages, with Borrowers hereby waiving all claims for any consequential damages to the extent permitted by applicable law) suffered by Borrowers that are not subject to indemnification under the Master Standby Agreement or the Master Documentary Agreement.

(vii)         Outstanding Letters of Credit.  Immediately prior to the Amendment Effective Date, the Letters of Credit listed on Schedule 1.1(d)(vii) hereto issued under the Existing Credit Agreement are and shall remain outstanding under this Agreement.

(e)           Funding Authorization.  The proceeds of all Loans made pursuant to this Agreement subsequent to the Amendment Effective Date are to be funded by Agent by wire transfer to the account designated by Borrower Representative below (the “Disbursement Account”):

Borrower Representative shall provide Agent with written notice of any change in the foregoing instructions at least three (3) Business Days before the desired effective date of such change.

1.2.         Interest and Applicable Margins.

(a)           Borrowers shall pay interest to Agent, for the ratable benefit of Lenders, in accordance with the various Loans being made by each Lender, in arrears on each applicable Interest Payment Date, at the following rates:  (i) with respect to the Revolving Credit Advances which are designated as Index Rate Loans (and for all other Obligations not otherwise set forth below), the Index Rate plus the Applicable Revolver Index Margin per annum or, with respect to Revolving Credit Advances which are designated as LIBOR Loans, at the election of Borrower Representative, the applicable LIBOR Rate plus the Applicable Revolver LIBOR Margin per annum; and (ii) with respect to the Swing Line Loan, the Index Rate plus the Applicable Revolver Index Margin per annum.

The Applicable Margins are as follows:

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Interest accrued and unpaid under the Existing Credit Agreement up to and including the Business Day immediately preceding the Amendment Effective Date shall accrue at the “Applicable Margins” (under and as such term is defined in the Existing Credit Agreement) in effect immediately prior to the Amendment Effective Date and shall be paid on the respective Interest Payment Dates that such interest would have been payable in the absence of this amendment and restatement.

The Applicable Margins shall be adjusted (up or down) prospectively on a quarterly basis as determined by Holdings’ consolidated financial performance, commencing with the first day of the first calendar month that occurs more than one Business Day after Agent shall have received the Financial Statements of Holdings and its Subsidiaries for the period ending December 31, 2005 (the “Initial Adjustment Date”).  Adjustments in Applicable Margins will be determined by reference to the following grids:

All adjustments in the Applicable Margins after the Initial Adjustment Date shall be implemented quarterly on a prospective basis, for each calendar quarter commencing at least one (1) day after the date of delivery to Lenders of the quarterly Compliance and Pricing Certificate evidencing the need for an adjustment.  Concurrently with the delivery of such Compliance and Pricing Certificate, Borrower Representative shall deliver to Agent and Lenders a certificate, signed by its chief financial officer, setting forth in reasonable detail the basis for the continuance of, or any change in, the Applicable Margins.  Failure to timely deliver such Compliance and Pricing Certificate shall, in addition to any other remedy provided for in this Agreement, result in an increase in the Applicable Margins to the highest level set forth in the foregoing grid, until the first day following the delivery of such Compliance and Pricing Certificate demonstrating that such an increase is not required.  If any Default or Event of Default has occurred and is continuing at the time any reduction in the Applicable Margins is to be implemented, that reduction shall be deferred until the first day of the first calendar month following the date on which all Defaults or Events of Default are waived or cured.

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(b)           If any payment on any Loan becomes due and payable on a day other than a Business Day, the maturity thereof will be extended to the next succeeding Business Day (except as set forth in the definition of LIBOR Period) and, with respect to payments of principal, interest thereon shall be payable at the then applicable rate during such extension.

(c)           All computations of Fees calculated on a per annum basis and interest shall be made by Agent on the basis of a 360-day year, in each case for the actual number of days occurring in the period for which such Fees and interest are payable.  The Index Rate is a floating rate determined for each day.  Each determination by Agent of an interest rate and Fees hereunder shall be final, binding and conclusive on Borrowers, absent manifest error.

(d)           So long as an Event of Default has occurred and is continuing under Section 6.1(a), (b), (f) or (g) and without notice of any kind, or so long as any other Event of Default has occurred and is continuing and at the election of Agent (or upon the written request of Requisite Lenders) confirmed by written notice from Agent to Borrower Representative, the interest rates applicable to the Loans and the Letter of Credit Fee shall be increased by up to two percentage points (2%) per annum above the rates of interest or the rate of such Fee otherwise applicable hereunder (“Default Rate”), and all outstanding Obligations shall bear interest at the Default Rate applicable to such Obligations.  Interest and Letter of Credit Fees at the Default Rate shall accrue from the initial date of such Event of Default until that Event of Default is cured or waived and shall be payable upon demand, but in any event, shall be payable on the next regularly scheduled payment date set forth herein for such Obligation.

(e)           Borrower Representative shall have the option to (i) request that any Revolving Credit Advance be made as a LIBOR Loan, (ii) convert at any time all or any part of outstanding Loans (other than the Swing Line Loan) from Index Rate Loans to LIBOR Loans, (iii) convert any LIBOR Loan to an Index Rate Loan, subject to payment of the LIBOR Breakage Fee in accordance with Section 1.3(e) if such conversion is made prior to the expiration of the LIBOR Period applicable thereto, or (iv) continue all or any portion of any Loan (other than the Swing Line Loan) as a LIBOR Loan upon the expiration of the applicable LIBOR Period and the succeeding LIBOR Period of that continued Loan shall commence on the first day after the last day of the LIBOR Period of the Loan to be continued.  Any Loan or group of Loans having the same proposed LIBOR Period to be made or continued as, or converted into, a LIBOR Loan must be in a minimum amount of $1,000,000 and integral multiples of $100,000 in excess of such amount.  Any such election must be made by 1:00 p.m. (New York time) on the third Business Day prior to (1) the date of any proposed Revolving Credit Advance which is to bear interest at the LIBOR Rate, (2) the end of each LIBOR Period with respect to any LIBOR Loans to be continued as such, or (3) the date on which Borrower Representative wishes to convert any Index Rate Loan (other than the Swing Line Loan) to a LIBOR Loan for a LIBOR Period designated by Borrower Representative in such election.  If no election is received with respect to an existing LIBOR Loan by 1:00 p.m. (New York time) on the third Business Day prior to the end of the LIBOR Period with respect thereto, that LIBOR Loan shall be converted to an Index Rate Loan at the end of its LIBOR Period.  Borrower Representative must make such election by notice to Agent in writing, by fax or overnight courier.  In the case of any conversion or continuation, such election must be made pursuant to a written notice (a “Notice of Conversion/Continuation”) in the form of Exhibit 1.2(e).  Notwithstanding anything to the contrary contained herein, Borrower Representative shall not make any request under clause (i) or clause (ii) of this paragraph (e) until the earlier of (A) five (5) days after the Amendment Effective Date and (B) the date that Agent shall have notified Borrower Representative in writing that GE Capital has completed the Primary Syndication (as defined in the GE Capital Fee Letter), except such LIBOR Loan based on a one week LIBOR Rate.  No Loan shall be made, converted into or continued as a LIBOR Loan if an Event of Default has occurred and is continuing and Agent or Requisite Lenders have determined not to make or continue any Loan as a LIBOR Loan as a result thereof.

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(f)            Notwithstanding anything to the contrary set forth in this Section 1.2, if a court of competent jurisdiction determines in a final order that any rate of interest payable hereunder exceeds the highest rate of interest permissible under law (the “Maximum Lawful Rate”), then so long as the Maximum Lawful Rate would be so exceeded, such rate of interest payable hereunder shall be equal to the Maximum Lawful Rate; provided, however, that if at any time thereafter such rate of interest payable hereunder is less than the Maximum Lawful Rate, Borrowers shall continue to pay interest hereunder at the Maximum Lawful Rate until such time as the total interest received by Agent, on behalf of Lenders, is equal to the total interest that would have been received had such interest rate payable hereunder been (but for the operation of this paragraph) the interest rate payable since the Amendment Effective Date as otherwise provided in this Agreement.  Thereafter, such interest hereunder shall be paid at the rate(s) of interest and in the manner provided in Sections 1.2(a) through (e), unless and until such rate of interest again exceeds the Maximum Lawful Rate, and at that time this paragraph shall again apply.  In no event shall the total interest received by any Lender pursuant to the terms hereof exceed the amount that such Lender could lawfully have received had the interest due hereunder been calculated for the full term hereof at the Maximum Lawful Rate.  If the Maximum Lawful Rate is calculated pursuant to this paragraph, such interest shall be calculated at a daily rate equal to the Maximum Lawful Rate divided by the number of days in the year in which such calculation is made.  If, notwithstanding the provisions of this Section 1.2(f), a court of competent jurisdiction shall determine by a final, non-appealable order that a Lender has received interest hereunder in excess of the Maximum Lawful Rate, Agent shall, to the extent permitted by applicable law, promptly apply such excess as specified in Section 1.5(e) and thereafter shall refund any excess to Borrowers or as such court of competent jurisdiction may otherwise order.

1.2.A.     Swap Related Reimbursement Obligations.

(a)           Borrowers agree to reimburse GE Capital in immediately available funds in the amount of any payment made by GE Capital under a Swap Related L/C (such reimbursement obligation, whether contingent upon payment by GE Capital under the Swap Related L/C or otherwise, being herein called a “Swap Related Reimbursement Obligation”).  No Swap Related Reimbursement Obligation for any Swap Related L/C may exceed the amount of the payment obligations owed by Borrowers under the interest rate protection or hedging agreement or transaction supported by the Swap Related L/C.

(b)           A Swap Related Reimbursement Obligation shall be due and payable by Borrowers within one (1) Business Day after the date on which the related payment is made by GE Capital under the Swap Related L/C.

(c)           Any Swap Related Reimbursement Obligation shall, during the period in which it is unpaid, bear interest at the rate per annum equal to the LIBOR Rate plus one percent (1%), as if the unpaid amount of the Swap Related Reimbursement Obligation were a LIBOR Loan, and not at any otherwise applicable Default Rate.  Such interest shall be payable upon demand.  The following additional provisions apply to the calculation and charging of interest by reference to the LIBOR Rate:

(i)            The LIBOR Rate shall be determined for each successive one-month LIBOR Period during which the Swap Related Reimbursement Obligation is unpaid, notwithstanding the occurrence of any Event of Default and even if the LIBOR Period were to extend beyond the Commitment Termination Date.

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(ii)           If a Swap Related Reimbursement Obligation is paid during a monthly period for which the LIBOR Rate is determined, interest shall be pro-rated and charged for the portion of the monthly period during which the Swap Related Reimbursement Obligation was unpaid.  Section 1.3(e) shall not apply to any payment of a Swap Related Reimbursement Obligation during the monthly period.

(iii)          Notwithstanding the last paragraph of the definition of “LIBOR Rate”, if the LIBOR Rate is no longer available from Telerate News Service, the LIBOR Rate shall be determined by GE Capital from such financial reporting service or other information available to GE Capital as in GE Capital’s reasonable discretion indicates GE Capital’s cost of funds.

(d)           Except as provided in the foregoing provisions of this Section 1.2A and in Section 9.1, Borrower shall not be obligated to pay to GE Capital or any of its Affiliates any Letter of Credit Fee, or any other fees, charges or expenses, in respect of a Swap Related L/C or arranging for any interest rate protection or hedging agreement or transaction supported by the Swap Related L/C.  GE Capital and its Affiliates shall look to the beneficiary of a Swap Related L/C for payment of any such letter of credit fees or other fees, charges or expenses and such beneficiary may factor such fees, charges, or expenses into the pricing of any interest rate protection or hedging arrangement or transaction supported by the Swap Related L/C.

(e)           If any Swap Related L/C is revocable prior to its scheduled expiry date, GE Capital agrees not to revoke the Swap Related L/C unless the Commitment Termination Date or an Event of Default has occurred and is continuing.

(f)            GE Capital or any of its Affiliates shall be permitted to (i) provide confidential or other information furnished to it by any of the Credit Parties (including, without limitation, copies of any documents and information in or referred to in the Closing Checklist, Financial Statements and Compliance Certificates) to a beneficiary or potential beneficiary of a Swap Related L/C and (ii) receive confidential or other information from the beneficiary or potential beneficiary relating to any agreement or transaction supported or to be supported by the Swap Related L/C.  However, no confidential information shall be provided to any Person under this paragraph unless the Person has agreed to comply with the covenant substantially as contained in Section 9.13 of this Agreement.

1.3.         Fees.

(a)           Fee Letter.  Borrowers shall pay to GE Capital, individually, the Fees specified in that certain fee letter dated as of November 1, 2005 among Penhall and GE Capital (the “GE Capital Fee Letter”), at the times specified for payment therein.

(b)           Unused Line Fee.  As additional compensation for the Revolving Lenders, Borrowers shall pay to Agent, jointly and severally, for the ratable benefit of such Lenders, in arrears, on the first Business Day of each month prior to the Commitment Termination Date and on the Commitment Termination Date, a fee for Borrowers’ non-use of available funds in an amount equal to one half of one percent (.50%) per annum multiplied by the difference between (x) the Maximum Amount (as it may be reduced from time to time) and (y) the average for the period of the daily closing balances of the Revolving Loan (including, without duplication, Swing Line Loans and Letter of Credit Obligations) outstanding during the period for which such Fee is due.

(c)           Omitted.

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(d)           Letter of Credit Fee.  Borrowers agree, jointly and severally, to pay to Agent for the benefit of Revolving Lenders, as compensation to such Revolving Lenders for Letter of Credit Obligations incurred hereunder, (i) all costs and expenses incurred by Agent or any Lender on account of such Letter of Credit Obligations, and (ii) for each month during which any Letter of Credit Obligation shall remain outstanding, a fee (the “Letter of Credit Fee”) in an amount per annum equal to the Applicable L/C Margin multiplied by the average daily undrawn face amount of all Letters of Credit issued by such L/C Issuer, which shall be paid to such L/C Issuer in arrears, on the first Business Day of each month and on the Commitment Termination Date, and (y) on demand, such fees (including all per annum fees), charges and expenses of such L/C Issuer in respect of the issuance, negotiation, acceptance, amendment, transfer and payment of such Letter of Credit or otherwise payable pursuant to the application and related documentation under which such Letter of Credit is issued.

(e)           LIBOR Breakage Fee.  Upon (i) any default by any Borrower in making any borrowing of, conversion into or continuation of any LIBOR Loan following Borrower Representative’s delivery to Agent of any LIBOR Loan request in respect thereof or (ii) any payment of a LIBOR Loan on any day that is not the last day of the LIBOR Period applicable thereto (regardless of the source of such prepayment and whether voluntary, by acceleration or otherwise), Borrowers shall pay Agent, for the benefit of all Lenders that funded or were prepared to fund any such LIBOR Loan, the LIBOR Breakage Fee.

(f)            Omitted.

(g)           Expenses and Attorneys’ Fees.  Borrowers agree to promptly pay all fees, charges, costs and expenses (including reasonable attorneys’ fees and expenses and the allocated cost of internal legal staff) incurred by Agent in connection with any matters contemplated by or arising out of the Loan Documents, in connection with the examination, review, due diligence investigation, documentation, negotiation, closing and syndication of the transactions contemplated herein and in connection with the continued administration of the Loan Documents including any amendments, modifications, consents and waivers.  Borrowers agree to reimburse Agent for all due and payable out of pocket costs (including reasonable fees and expenses) as incurred by Agent to (i) third party auditors, and a fee of $800 per audit day per in-house auditor, plus reasonable out of pocket expenses incurred by any such auditors in each case for up to three audits per Fiscal Year (unless an Event of Default shall have occurred and be continuing in which case such audits will be conducted as frequently as requested by Agent at the expense of Borrowers), (ii) third party parts and supplies and equipment/inventory appraisers, plus out of pocket expenses incurred by such appraisers, in each case for up to three parts and supplies and equipment/inventory appraisals per Fiscal Year (unless an Event of Default have occurred and be continuing in which case such appraisals will be conducted as frequently as requested by Agent at the expense of Borrowers), and (iii) third party real estate appraisers, plus out of pocket expenses incurred by such appraisers.

1.4.         Payments.  All payments by Borrowers of the Obligations shall be without deduction, defense, setoff or counterclaim and shall be made in same day funds and delivered to Agent, for the benefit of Agent and Lenders, as applicable, by wire transfer to the following account or such other place as Agent may from time to time designate in writing.

ABA No. ▇▇▇-▇▇▇-▇▇▇

Account Number ▇▇▇-▇▇▇-▇▇

Deutsche Bank Trust Company Americas

New York, New York

ACCOUNT NAME: GECC/CAF DEPOSITORY

Reference:  GE Capital re Penhall – CFN 5134

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Borrowers shall receive credit on the day of receipt for funds received by Agent by 2:00 p.m. (New York time).  In the absence of timely receipt, such funds shall be deemed to have been paid on the next Business Day.  Whenever any payment to be made hereunder shall be stated to be due on a day that is not a Business Day, the payment may be made on the next succeeding Business Day and such extension of time shall be included in the computation of the amount of interest and Fees due hereunder.

Borrowers hereby authorize Lenders to make Revolving Credit Advances or Swing Line Advances, on the basis of their Pro Rata Shares, for the payment of interest, Fees and expenses, Letter of Credit reimbursement obligations and any amounts required to be deposited with respect to outstanding Letter of Credit Obligations pursuant to Sections 1.5(g) or 6.3.

1.5.         Prepayments.

(a)           Voluntary Prepayments of Loans.  At any time, Borrowers may prepay the Loans, in whole or in part, without premium or penalty subject to the payment of LIBOR Breakage Fees, if applicable.

(b)           Omitted.

(c)           Prepayments from Asset Dispositions.  Except as otherwise provided in Section 1.5(f) hereof, immediately upon receipt of any Net Proceeds in excess of $250,000 for any single transaction or series of related transactions during any Fiscal Year, Borrowers shall repay the Revolving Credit Advances (without reduction of the Revolving Loan Commitment) by an amount equal to the amount of such excess Net Proceeds.  Borrowers or their Subsidiaries may reinvest all remaining Net Proceeds of such Asset Disposition (other than from a Permitted Sale-Leaseback), within one hundred and eighty (180) days, in productive replacement assets of a kind then used or usable in the business of Borrowers.  If Borrowers do not intend to so reinvest such Net Proceeds or if the period set forth in the immediately preceding sentence expires without Borrowers having reinvested such Net Proceeds, Borrowers shall prepay the Revolving Credit Advances (without reduction of the Revolving Loan Commitment) in an amount equal to such remaining Net Proceeds of such Asset Disposition, provided that if such Net Proceeds relate to assets not included in the determination of Borrowing Base no such prepayment in respect of the Revolving Credit Advances shall be required.  The payments on the Revolving Credit Advances shall be applied in accordance with Section 1.5(e).

(d)           Prepayments from Issuance of Stock.  Immediately upon the receipt by Holdings, any Borrower or any of their Subsidiaries of the proceeds of the issuance of Stock (other than Stock issued to Holdings, Borrowers, any Subsidiary of Borrower or members of Holdings management)], Holdings shall prepay the Loans in an amount equal to such Net Proceeds.  The payments shall be applied in accordance with Section 1.5(e).

(e)           Application of Proceeds.  With respect to any prepayments made by any Borrower pursuant to Section 1.5(a), Section 1.5(c) and Section 1.5(d), such prepayments shall be applied as follows: first, to reduce the outstanding principal balance of the Swing Line Loan outstanding to that Borrower until the same has been repaid in full; second, to the Revolving Credit Advances outstanding to that Borrower until the same has been repaid in full and, except in the case of prepayments made pursuant to Section 1.5(a), as a permanent reduction of the Revolving Loan Commitment; third, to the principal balances of the Swing Line Loan outstanding to each other Borrower, pro rata, until the same have been repaid in full; and fourth, to the principal balance of the Revolving Credit Advances made to each other Borrower, pro rata, until the same has been repaid in full and, except in the case of prepayments made pursuant to Section 1.5(a) and 1.5(c),  as a permanent reduction of the Revolving Loan Commitment.  Considering each type of Loan being prepaid separately, any such prepayment shall be applied first to

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Index Rate Loans of the type required to be prepaid before application to LIBOR Loans of the type required to be prepaid, in each case in a manner which minimizes any resulting LIBOR Breakage Fee.

(f)            Application of Prepayments from Insurance Proceeds.  Prepayments from insurance in accordance with Section 2.2 or condemnation proceeds shall be applied as follows: insurance proceeds from casualties or losses to cash, Parts and Supplies, Equipment, Fixtures and Real Estate shall be applied first, to the Swing Line Loans and second to the Revolving Credit Advances of the Borrower that incurred such casualties with losses and then to the Swing Line Loans and last to the Revolving Credit Advances of the other Borrowers (pro rata in each case).  The Revolving Loan Commitment and the Swing Line Loan Commitment shall be permanently reduced by the amount of any such prepayments.

(g)           Letter of Credit Obligations.  In the event any Letters of Credit are outstanding at the time that the Revolving Loan Commitment is terminated, Borrowers shall (1) deposit with Agent for the benefit of all Revolving Lenders cash in an amount equal to 105% of the aggregate outstanding Letter of Credit Obligations to be available to Agent to reimburse payments of drafts drawn under such Letters of Credit and pay any Fees and expenses related thereto and (2) prepay the fee payable under Section 1.3(d) with respect to such Letters of Credit for the full remaining terms of such Letters of Credit.  Upon termination of any such Letter of Credit, the unearned portion of such prepaid fee attributable to such Letter of Credit shall be refunded to Borrowers.

(h)           Prepayments under Sections 1.5(c), 1.5(d) and 1.5(f) shall be accompanied by accrued and unpaid interest on the amount prepaid.

1.6.         Maturity.  All of the Obligations shall become due and payable as otherwise set forth herein, but in any event all of the remaining Obligations shall become due and payable upon termination of this Agreement.  Until all Obligations have been fully paid and satisfied (other than contingent indemnification obligations to the extent no unsatisfied claim has been asserted), the Revolving Loan Commitment has been terminated and all Letters of Credit have been terminated or otherwise secured to the satisfaction of Agent, Agent shall be entitled to retain the security interests in the Collateral granted under the Collateral Documents and the ability to exercise all rights and remedies available to them under the Loan Documents and applicable laws.  Notwithstanding anything contained in this Agreement to the contrary, upon any termination of the Revolving Loan Commitment, all of the Obligations shall be due and payable.

1.7.         Eligible Accounts.  All of the Accounts owned by any Borrower and reflected in the most recent Borrowing Base Certificate delivered by such Borrower to Agent shall be “Eligible Accounts” for purposes of this Agreement, except any Account to which any of the exclusionary criteria set forth below applies.  Agent shall have the right to establish, modify or eliminate Reserves against Eligible Accounts from time to time in its reasonable credit judgment.  In addition, Agent reserves the right, at any time and from time to time after the Closing Date upon five (5) days’ prior written notice, to adjust any of the criteria set forth below, to establish new criteria and to adjust advance rates with respect to Eligible Accounts, in its reasonable credit judgment, subject to the approval of Supermajority Revolving Lenders in the case of adjustments, new criteria or changes in advance rates which have the effect of making more credit available.  Eligible Accounts shall not include any Account of any Borrower:

(a)           that does not arise from the sale of goods or the performance of services by such Borrower in the ordinary course of its business;

(b)           (i) upon which such Borrower’s right to receive payment is not absolute or is contingent upon the fulfillment of any condition whatsoever or (ii) as to which such Borrower is not able to bring suit or otherwise enforce its remedies against the Account Debtor through judicial process, or

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(iii) if the Account represents progress billing in excess of cost or percentage of completion of the applicable contract or is subject to the equitable lien of a surety bond issuer;

(c)           to the extent that any defense, counterclaim, setoff or dispute is asserted as to such Account;

(d)           that is not a true and correct statement of bona fide indebtedness incurred in the amount of the Account for merchandise sold to or services rendered and accepted by the applicable Account Debtor;

(e)           with respect to which an invoice, reasonably acceptable to Agent in form and substance, has not been sent to the applicable Account Debtor (including, without limitation, accrued but unbilled Accounts of “Division 40”);

(f)            that (i) is not owned by such Borrower or (ii) is subject to any right, claim, security interest or other interest of any other Person, other than Liens in favor of Agent, on behalf of itself and Lenders and Permitted Encumbrances of the type described in clauses (a), (g) or (l) of the definition of such term;

(g)           that arises from a sale to any director, officer, other employee or Affiliate of any Credit Party, or to any entity that has any common officer or director with any Credit Party;

(h)           that is the obligation of an Account Debtor that is the United States government or a political subdivision thereof, unless Agent, in its sole discretion, has agreed to the contrary in writing and such Borrower, if necessary or desirable, has complied with respect to such obligation with the Federal Assignment of Claims Act of 1940, or any applicable state, county or municipal law restricting the assignment thereof with respect to such obligation;

(i)            that is the obligation of an Account Debtor located in a foreign country, other than Canada, unless payment thereof is assured by a letter of credit assigned and delivered to Agent, satisfactory to Agent as to form, amount and issuer;

(j)            to the extent such Borrower or any Subsidiary thereof is liable for goods sold or services rendered by the applicable Account Debtor to such Borrower or any Subsidiary thereof but only to the extent of the potential offset;

(k)           that arises with respect to goods that are delivered on a ▇▇▇▇-and-hold, cash-on-delivery basis or placed on consignment, guaranteed sale or other terms by reason of which the payment by the Account Debtor is or may be conditional;

(l)            that is in default; provided, that without limiting the generality of the foregoing, an Account shall be deemed in default upon the occurrence of any of the following:

(i)            the Account is not paid within the earlier of: 60 days following its due date or 90 days following its original invoice date;

(ii)           the Account Debtor obligated upon such Account suspends business, makes a general assignment for the benefit of creditors or fails to pay its debts generally as they come due; or

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(iii)          a petition is filed by or against any Account Debtor obligated upon such Account under any bankruptcy law or any other federal, state or foreign (including any provincial) receivership, insolvency relief or other law or laws for the relief of debtors;

(m)          that is the obligation of an Account Debtor if 50% or more of the Dollar amount of all Accounts owing by that Account Debtor are ineligible under clause (i) of paragraph (l) of this Section 1.7;

(n)           as to which Agent’s Lien thereon, on behalf of itself and Lenders, is not a first priority perfected Lien;

(o)           as to which any of the representations or warranties in the Loan Documents are untrue;

(p)           to the extent such Account is evidenced by a judgment, Instrument or Chattel Paper;

(q)           to the extent such Account exceeds any credit limit established by Agent, in its reasonable credit judgment, following five (5) days’ prior written notice of such limit by Agent to Borrower Representative;

(r)            to the extent that such Account, together with all other Accounts owing to such Account Debtor and its Affiliates as of any date of determination exceed 15% of all Eligible Accounts of all Borrowers;

(s)            that is payable in any currency other than Dollars or Canadian Dollars;

(t)            that constitutes a “retention” Account; or

(u)           that is otherwise unacceptable to Agent in its reasonable credit judgment.

1.8.A.     Eligible Short-Term Rentals.  All of the Short-Term Rentals owned by any Borrower and reflected in the most recent Borrowing Base Certificate delivered by such Borrower to Agent shall be “Eligible Short-Term Rentals” for purposes of this Agreement, except any Short-Term Rentals to which any of the exclusionary criteria set forth below applies.  Agent shall have the right, following five (5) days’ prior written notice by Agent to Borrower Representative, to establish, modify, or eliminate Reserves against Eligible Short-Term Rentals from time to time in its reasonable credit judgment.  In addition, Agent reserves the right, at any time and from time to time after the Closing Date to adjust any of the criteria set forth below, to establish new criteria and to adjust advance rates with respect to Eligible Short-Term Rentals in its reasonable credit judgment, subject to the approval of Supermajority Revolving Lenders in the case of adjustments, new criteria or changes in advance rates which have the effect of making more credit available.  Eligible Short-Term Rentals shall not include any Short-Term Rentals of any Borrower:

(a)           not subject to a written lease agreement;

(b)           not subject to a first priority perfected security interest of Agent on behalf of Lenders;

(c)           any portion of such Short-Term Rental that has not been billed or is not due within thirty (30) days of the applicable date of determination;

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(d)           upon which such Borrower is not able to bring suit or otherwise enforce its remedies against the relevant lessee through judicial process;

(e)           that (i) are not owned by such Borrower or (ii) are subject to any right, claim, security interest or other interest of any other Person, other than Liens in favor of Agent, on behalf of itself and Lenders and Permitted Encumbrances of the type described in clauses (a), (g) or (l) of the definition of such term;

(f)            that are the obligation of a lessee that is the United States government or a political subdivision thereof, unless Agent, in its sole discretion, has agreed to the contrary in writing and such Borrower, if necessary or desirable, has complied with respect to such obligation with the Federal Assignment of Claims Act of 1940, or any applicable state, county or municipal law restricting the assignment thereof with respect to such obligation;

(g)           that are the obligation of a lessee located in a foreign country, other than Canada;

(h)           to the extent that such Short-Term Rental, together with other Short-Term Rentals at such time, exceeds $500,000 in the aggregate;

(i)            that are in default or due under a lease in default; provided, that without limiting the generality of the foregoing, a Short-Term Rental shall be deemed in default upon the occurrence of any of the following:

(i)            the Short-Term Rental is not paid within the earlier of: 60 days following its due date or 90 days following its original invoice date;

(ii)           the lessee obligated upon such Short-Term Rental suspends business, makes a general assignment for the benefit of creditors or fails to pay its debts generally as they come due; or

(iii)          a petition is filed by or against any lessee obligated upon such Short-Term Rental under any bankruptcy law or any other federal, state or foreign (including any provincial) receivership, insolvency relief or other law or laws for the relief of debtors;

(j)            that are the obligation of a lessee if fifty percent (50%) or more of the Dollar amount of all Short-Term Rental owing by that lessee are ineligible under clause (i) of paragraph (i) of this Section 1.8(A);

(k)           as to which any of the representations or warranties in the Loan Documents are untrue;

(l)            to the extent such Short-Term Rental exceeds any credit limit established by Agent, in its reasonable credit judgment, following five (5) days’ prior written notice of such limit by Agent to Borrower Representative;

(m)          that are payable in any currency other than Dollars or Canadian Dollars; or

(n)           that are otherwise unacceptable to Agent in its reasonable credit judgment.

1.8.B.     Eligible Parts and Supplies.  All of the Parts and Supplies owned by any Borrower and reflected in the most recent Borrowing Base Certificate delivered by such Borrower to Agent shall be

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“Eligible Parts and Supplies” for purposes of this Agreement, except any Parts and Supplies to which any of the exclusionary criteria set forth below applies.  Agent shall have the right, following five (5) days’ prior written notice by Agent to Borrower Representative, to establish, modify, or eliminate Reserves against Eligible Parts and Supplies from time to time in its reasonable credit judgment.  In addition, Agent reserves the right, at any time and from time to time after the Closing Date to adjust any of the criteria set forth below, to establish new criteria and to adjust advance rates with respect to Eligible Parts and Supplies in its reasonable credit judgment, subject to the approval of Supermajority Revolving Lenders in the case of adjustments, new criteria or changes in advance rates which have the effect of making more credit available.  Eligible Parts and Supplies shall not include any Parts and Supplies of any Borrower that:

(a)           is not owned by such Borrower free and clear of all Liens and rights of any other Person (including the rights of a purchaser that has made progress payments and the rights of a surety that has issued a bond to assure such Borrower’s performance with respect to such Parts and Supplies), except the Liens in favor of Agent, on behalf of itself and Lenders and Permitted Encumbrances of the type described in clauses (a), (d), (e), (g) or (l) of the definition of such term;

(b)           (i)  is not located on premises owned, leased or rented by such Borrower and set forth in the various subschedules to Schedule III to the Security Agreement (excluding Parts and Supplies mounted on, affixed to or otherwise placed in a motor vehicle owned by such Borrower and such motor vehicle is located at the residence of the driver authorized to drive such motor vehicle, provided that such motor vehicle (A) is covered by a certificate of title on which the interest of Agent has been noted, free and clear of all Liens except those in favor of Agent and Lenders and Permitted Encumbrances of the type described in clauses (a), (d), (e), (g) or (l) of the definition of such term, and (B) is equipped with a global positioning tracking device (that is permanently affixed to such motor vehicle) that enables such Borrower to determine at all times the movement and location of such motor vehicle or (ii) is stored at a leased location, unless Agent has given its prior consent thereto and unless (x) a reasonably satisfactory landlord waiver has been delivered to Agent within thirty (30) days after the Closing Date, or (y) Reserves equal to three months’ rent (based upon base rent and such Borrower’s pro rata share of operating costs, utilities and taxes payable by such Borrower under the lease, but excluding any supplemental rent or other costs, expenses or amounts or any indemnities payable thereunder, upon default or otherwise) have been established with respect thereto, or (iii) is stored with a bailee or warehouseman unless a reasonably satisfactory, acknowledged bailee letter has been received by Agent and Reserves reasonably satisfactory to Agent have been established with respect thereto, or (iv) is located at an owned location subject to a mortgage in favor of a lender other than Agent, unless a reasonably satisfactory mortgagee waiver has been delivered to Agent, or (v) is located at any site if the aggregate book value of Parts and Supplies, together with Equipment of any Borrower, at any such location is less than $100,000;

(c)           is placed on consignment or is in transit, except for Parts and Supplies in transit between domestic locations of Credit Parties as to which Agent’s Liens have been perfected at origin and destination;

(d)           is covered by (i) a negotiable document of title, unless such document has been delivered to Agent with all necessary endorsements, free and clear of all Liens except those in favor of Agent and Lenders or (ii) a certificate of title unless (x) Borrower sells goods of that kind and that Parts and Supplies is held for sale or lease or is on lease by Borrower as lessor or (y) the Lien of Agent has been noted on such certificate of title in accordance with applicable state law;

(e)           is excess, obsolete, unsaleable, shopworn, seconds, damaged or unfit for sale;

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(f)            is stored in, installed in or affixed to any property subject to any Lien having priority over the Lien of Agent for the benefit of Agent and the ratable benefit of Lenders (including Permitted Encumbrances) and the holder of such Lien has not entered into an intercreditor agreement in form and substance satisfactory to Agent as to such Lien;

(g)           is not subject to a first priority lien in favor of Agent on behalf of itself and Lenders subject to Permitted Encumbrances of the type described in clauses (a), (d), (e), (g) or (l) of the definition of such term;

(h)           breaches any of the representations or warranties pertaining to Parts and Supplies set forth in the Loan Documents;

(i)            omitted;

(j)            consists of Hazardous Materials or goods that can be transported or sold only with licenses that are not readily available;

(k)           is not covered by casualty insurance reasonably acceptable to Agent;

(l)            omitted;

(m)          is otherwise unacceptable to Agent in its reasonable credit judgment.

Notwithstanding anything to the contrary contained in this Agreement, until there has been a determination of Net Orderly Liquidation Value of Parts and Supplies, none of the Parts and Supplies shall be Eligible Parts and Supplies.

1.8.C.     Eligible Equipment. All of the Equipment owned by any Borrower and reflected in the most recent Borrowing Base Certificate delivered by such Borrower to Agent shall be “Eligible Equipment” for purposes of this Agreement, except any Equipment to which any of the exclusionary criteria set forth below applies.  Agent shall have the right, following five (5) days’ prior written notice by Agent to Borrower Representative, to establish, modify, or eliminate Reserves against Eligible Equipment from time to time in its reasonable credit judgment.  In addition, Agent reserves the right, at any time and from time to time after the Closing Date, to adjust any of the criteria set forth below, to establish new criteria and to adjust advance rates with respect to Eligible Equipment in its reasonable credit judgment, subject to the approval of Supermajority Revolving Lenders in the case of adjustments, new criteria or changes in advance rates which have the effect of making more credit available.  Eligible Equipment shall not include any Equipment of any Borrower that:

(a)           is not owned by such Borrower free and clear of all Liens and rights of any other Person (including the rights of a purchaser that has made progress payments and the rights of a surety that has issued a bond to assure such Borrower’s performance with respect to that Equipment), except the Liens in favor of Agent, on behalf of itself and Lenders and Permitted Encumbrances of the type described in clauses (a), (d), (e), (g) or (l) of the definition of such term;

(b)           (i) is not located on premises owned, leased or rented by such Borrower and set forth in the various subschedules to Schedule III to the Security Agreement (unless, at any time, such Equipment is being used at a construction or similar site or, if such Equipment is mounted on, affixed to or otherwise placed in a motor vehicle or such Equipment is a motor vehicle owned by such Borrower, such motor vehicle is located at the residence of the driver authorized to drive the motor vehicle, provided that such motor vehicle (A) is covered by a certificate of title on which the interest of Agent has been

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noted, free and clear of all Liens except those in favor of Agent and Lenders and Permitted Encumbrances of the type described in clauses (a), (d), (e), (g) or (l) of the definition of such term, and (B) is equipped with a global positioning tracking device (that is permanently affixed to such motor vehicle) that enables such Borrower to determine at all times the movement and location of such motor vehicle or (ii) is stored at a leased location, unless Agent has given its prior consent thereto and unless (x) a reasonably satisfactory landlord’s waiver has been delivered to Agent within (30) days after the Closing Date, or (y) Reserves equal to three months’ rent (based upon base rent and such Borrower’s pro rata share of operating costs, utilities and taxes payable by such Borrower under the lease, but excluding any supplemental rent or other costs, expenses or amounts or any indemnities payable thereunder, upon default or otherwise) have been established with respect thereto, or (iii) is stored with a bailee or warehouseman unless a reasonably satisfactory, acknowledged bailee letter has been received by Agent and Reserves reasonably satisfactory to Agent have been established with respect thereto, or (iv) is located at an owned location subject to a mortgage in favor of a lender other than Agent, unless a reasonably satisfactory mortgagee waiver has been delivered to Agent, or (v) is located at any site if the aggregate book value of Equipment, together with Parts and Supplies of any Borrower, at any such location is less than $100,000;

(c)           that is covered by a certificate of title unless the interest of Agent has been noted on such certificate of title, free and clear of all Liens except those in favor of Agent and Lenders and Permitted Encumbrances of the type described in clauses (a), (d), (e), (g) or (l) of the definition of such term;

(d)           is excess, obsolete, unsaleable, shopworn, seconds, damaged or unfit for sale;

(e)           is not a vehicle or a construction tool used by such Borrower in the ordinary course of its business;

(f)            is not subject to a first priority lien in favor of Agent on behalf of itself and Lenders subject to Permitted Encumbrances of the type described in clauses (a), (d), (e), (g) or (l) of the definition of such term;

(g)           breaches any of the representations or warranties pertaining to Equipment set forth in the Loan Documents;

(h)           that is Parts and Supplies;

(i)            consists of Hazardous Materials or goods that can be transported or sold only with licenses that are not readily available;

(j)            is not covered by casualty insurance reasonably acceptable to Agent; or

(k)           is otherwise unacceptable to Agent in its reasonable credit judgment.

1.8.D.     Eligible Real Estate.  Eligible Real Estate of any Borrower shall be that real estate and improvements thereon that Agent has specifically identified and approved in writing and as to which, following an independent appraisal thereof, Agent has assigned an Appraised Forced Liquidation Value and to which none of the criteria below applies.  Agent shall have the right, following five (5) days’ prior written notice by Agent to Borrower Representative, to establish, modify or eliminate Reserves against Eligible Real Estate from time to time in its reasonable credit judgment.  In addition, Agent reserves the right, at any time and from time to time after the Closing Date, to adjust any of the criteria set forth below, to establish new criteria and to adjust advance rates with respect to Eligible Real Estate in its

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reasonable credit judgment, subject to the approval of the Supermajority Revolving Lenders in the case of adjustments, new criteria or changes in advance rates that have the effect of making more credit available.  Eligible Real Estate shall not include any real estate:

(a)           that is not owned by such Borrower free and clear of all Liens and rights of any other Person, except the Liens in favor of Agent, on behalf of itself and Lenders and Permitted Encumbrances of the type described in clauses (a), (d), (e) (g), (h), (j) or (l) of the definition of such term;

(b)           as to which Agent has not received a loan policy of title insurance in favor of Agent and in form and amount, and issued by a title insurance company, satisfactory to Agent, in its reasonable discretion, together with such endorsements thereto as Agent shall require, in its reasonable discretion (provided such endorsements are available in the jurisdiction where such Real Estate is located);

(c)           as to which Agent has not received an environmental report satisfactory to Agent, in its sole discretion;

(d)           that is not subject to a first priority Lien in favor of Agent on behalf of itself and Lenders subject only to Permitted Encumbrances;

(e)           that breaches any of the representations or warranties pertaining to Real Estate set forth in the Loan Documents; or

(f)            that is not covered by casualty insurance reasonably acceptable to Agent.

1.9.         Loan Accounts.  Agent shall maintain a loan account (the “Loan Account”) on its books to record: all Advances, all payments made by Borrowers, and all other debits and credits as provided in this Agreement with respect to the Loans or any other Obligations.  All entries in the Loan Account shall be made in accordance with Agent’s customary accounting practices as in effect from time to time.  The balance in the Loan Account, as recorded on Agent’s most recent printout or other written statement, shall, absent manifest error, be presumptive evidence of the amounts due and owing to Agent and Lenders by Borrowers; provided that any failure to so record or any error in so recording shall not limit or otherwise affect any Borrower’s duty to pay the Obligations.  Agent shall render to Borrower Representative a monthly accounting of transactions with respect to the Loans setting forth the balance of the Loan Account as to each Borrower for the immediately preceding month.  Unless Borrower Representative notifies Agent in writing of any objection to any such accounting (specifically describing the basis for such objection), within forty-five (45) days after the date thereof, each and every such accounting shall, absent manifest error, be deemed final, binding and conclusive on Borrowers in all respects as to all matters reflected therein.  Only those items expressly objected to in such notice shall be deemed to be disputed by Borrowers.  Notwithstanding any provision herein contained to the contrary, any Lender may elect (which election may be revoked) to dispense with the issuance of Notes to that Lender and may rely on the Loan Account as evidence of the amount of Obligations from time to time owing to it.

1.10.       Yield Protection; Illegality.

(a)           Capital Adequacy and Other Adjustments.  In the event that any Lender shall have determined that the adoption after the date hereof of any law, treaty, governmental (or quasi-governmental) rule, regulation, guideline or order regarding capital adequacy, reserve requirements or similar requirements or compliance by any Lender or any corporation controlling such Lender with any request or directive regarding capital adequacy, reserve requirements or similar requirements (whether or not having the force of law and whether or not failure to comply therewith would be unlawful) from any

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central bank or governmental agency or body having jurisdiction does or shall have the effect of increasing the amount of capital, reserves or other funds required to be maintained by such Lender or any corporation controlling such Lender and thereby reducing the rate of return on such Lender’s or such corporation’s capital as a consequence of its obligations hereunder, then Borrowers shall from time to time within fifteen (15) days after notice and demand to Borrower Representative from such Lender (together with the certificate referred to in the next sentence and with a copy to Agent) pay to Agent, for the account of such Lender, additional amounts sufficient to compensate such Lender for such reduction.  A certificate as to the amount of such cost and showing the basis of the computation of such cost submitted by such Lender to Borrower Representative and Agent shall, absent manifest error, be final, conclusive and binding for all purposes.

(b)           Increased LIBOR Funding Costs; Illegality.  Notwithstanding anything to the contrary contained herein, if the introduction of or any change in any law, rule, regulation, treaty or directive (or any change in the interpretation thereof) shall make it unlawful, or any central bank or other Governmental Authority shall assert that it is unlawful, for any Lender to agree to make or to make or to continue to fund or maintain any LIBOR Loan, then, unless that Lender is able to make or to continue to fund or to maintain such LIBOR Loan at another branch or office of that Lender without, in that Lender’s opinion, adversely affecting it or its Loans or the income obtained therefrom, on notice thereof and demand therefor by such Lender to Borrower Representative through Agent, (i) the obligation of such Lender to agree to make or to make or to continue to fund or maintain LIBOR Loans shall terminate and (ii) each Borrower shall forthwith prepay in full all outstanding LIBOR Loans owing by such Borrower to such Lender, together with interest accrued thereon, unless Borrower Representative on behalf of such Borrower, within five (5) Business Days after the delivery of such notice and demand, converts all LIBOR Loans into Index Rate Loans. If, after the date hereof, the introduction of, change in or interpretation of any law, rule, regulation, treaty or directive would impose or increase reserve requirements (other than as taken into account in the definition of LIBOR) or otherwise increase the cost to any Lender of making or maintaining a LIBOR Loan, then Borrowers shall from time to time within fifteen (15) days after notice and demand from Agent to Borrower Representative (together with the certificate referred to in the next sentence) pay to Agent, for the account of all such affected Lenders, additional amounts sufficient to compensate such Lenders for such increased cost.  A certificate as to the amount of such cost and showing the basis of the computation of such cost submitted by Agent on behalf of all such affected Lenders to Borrower Representative shall, absent manifest error, be final, conclusive and binding for all purposes.

1.11.       Taxes.

(a)           No Deductions.  Except as provided by law or as otherwise provided in this Section 1.11, any and all payments or reimbursements made hereunder (including any payments made pursuant to Section 10) or under the Notes or other Loan Documents shall be made free and clear of and without deduction for any and all Charges, taxes, levies, imposts, deductions or withholdings, and all liabilities with respect thereto of any nature whatsoever imposed by any taxing authority (collectively, “Taxes”), excluding (i) Taxes imposed on Agent’s or a Lender’s net income by the jurisdiction in which Agent or such Lender is organized; (ii) withholding Taxes that are imposed on amounts payable to Agent or Lender to the extent that the obligation to withhold amounts existed on the date that such Agent or Lender became a party to this Agreement in the capacity under which such Person makes a claim under clause (b), except in each case to the extent such Agent or Lender is an assignee of any other Person that was entitled, at the time the assignment of such other Person became effective, to receive additional amounts under clause (b) or (iii) Taxes that are directly attributable to the failure (other than as a result of a change in any applicable law) by any Lender to deliver the documentation required to be delivered pursuant to clause (g) below (collectively, “Excluded Taxes” and all such non-Excluded Taxes, “Non-Excluded Taxes”).

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(b)           Additional Payments.  If any Taxes shall be required by law to be deducted from or in respect of any amount payable under any Loan Document to any Agent or Lender (i) in the case of Non-Excluded Taxes, such amount shall be increased as necessary to ensure that, after all required deductions for Non-Excluded Taxes are made (including deductions applicable to any increases to any amount under this Section 1.11), such Agent or Lender receives, on an after-tax basis, the amount it would have received had no such deductions been made, (ii) the relevant Borrower shall make such deductions, (iii) the relevant Borrower shall timely pay the full amount deducted to the relevant taxing authority or other Governmental Authority in accordance with applicable law and (iv) within 30 days after such payment is made, the relevant Borrower shall deliver to Agent, at its address referred to on the signature pages hereof, an original or certified copy of a receipt evidencing such payment (or other evidence satisfactory to the Agent).  If Agent or such Lender becomes entitled to claim any additional amounts pursuant to this Section 1.11(b), it shall promptly notify Borrower Representative of the event by reason of which Agent or such Lender has become so entitled.  A certificate as to any additional amounts payable pursuant to the foregoing sentence submitted by Agent or such Lender to Borrower Representative (with a copy to Agent) shall, absent manifest error, be final, conclusive and binding for all purposes.

(c)           Other Taxes. In addition, the Borrowers agree to pay, and authorize Agent to pay in their name, as necessary, any current or future stamp or documentary taxes or any other excise or property taxes, charges, assessments or similar levies that arise from any payment made hereunder or from the execution, delivery or registration of, or otherwise with respect to, this Agreement, the other Loan Documents or any Loans made or Letters of Credit issued hereunder (“Other Taxes”).

(d)           Indemnification. The Borrowers shall indemnify Agent and each Lender for the full amount of Non-Excluded Taxes and Other Taxes paid by Agent or such Lender, as the case may be, and any liability (including penalties, interest and expenses other than penalties, interest and expenses resulting from the Lender’s gross negligence) arising therefrom or with respect thereto, whether or not such Non-Excluded Taxes or Other Taxes were correctly or legally asserted by the relevant taxing authority or other Governmental Authority.  Such indemnification shall be made within 30 days after the date Agent or any Lender, as the case may be, makes written demand therefor.  A certificate of Agent or Lender claiming any compensation under this clause (d), setting forth the amounts to be paid thereunder and delivered to the Borrower with copy to Agent, shall be conclusive, binding and final for all purposes, absent manifest error.

(e)           Tax Refunds.  If Lender or Agent, as the case may be, determines that it is entitled to receive a refund or credit of such Tax or Other Tax, as to which Borrower has made an additional payment under this Section 1.11 or if Lender or Agent has been indemnified pursuant to this Section 1.11, Lender or Agent shall promptly notify such Borrower of the availability of such refund or credit.  Lender or Agent, as the case may be, shall apply for such refund or credit, at Borrower’s expense, within 30 days after receipt of instruction from Borrower to apply for such refund, and in the case of any application for refund or credit made by a Borrower, Lender shall deliver to such Borrower, at such Borrower’s request, such certificates, forms or other documentation as may be reasonably necessary to assist such Borrower in such application.  If any Lender or Agent determines in its sole discretion that it has received a refund or credit with respect to any Tax or Other Tax as to which Borrower has made an additional payment under Section 1.11 or if Lender or Agent has been indemnified pursuant to this Section 1.11, Lender or Agent shall promptly notify Borrower and shall, within 30 days of receipt of such refund or the benefit of such credit, repay the amount of such refund or the benefit of such credit to such Borrower, plus any interest received with respect thereto, net of all reasonable out-of-pocket expenses of Agent or such Lender; provided, however, that the Borrower, upon the request of such Agent or Lender, agrees to repay the amount paid over to the Borrower to such Agent or Lender in the event such Agent or Lender is required to repay such refund, offset, reduction, or credit.

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(f)            Mitigation. Agent and Lenders shall use their reasonable efforts to avoid or reduce any Non-Excluded Taxes by taking any appropriate action (including assigning their rights hereunder to a related entity or a different office) which, as determined at such Agent or Lender’s sole discretion, would not be otherwise disadvantageous to such Agent or Lender.

(g)           Tax Forms.

(i)            Prior to becoming a Lender under this Agreement and on or before a previously delivered Certificate of Exemption (as defined below) expires or becomes inapplicable or obsolete, other than by reason of a change in the applicable rules as in effect at the time a Lender becomes a Lender under this Agreement, each Lender that is not a “United States person” (as such term is defined in IRC Section 7701(a)(30)) for U.S. federal income tax purposes (a “Foreign Lender”) shall provide to Borrower Representative and Agent a properly completed and executed IRS Form W-8BEN or Form W-8ECI or other applicable form, certificate or document prescribed by the IRS of the United States certifying as to such Foreign Lender’s entitlement to an exemption from, or a reduction in, United States federal withholding tax under the applicable rules as in effect at the time the Lender becomes a Lender under this Agreement with respect to payments to be made to such Foreign Lender under this Agreement and under the Notes (a “Certificate of Exemption”).  Notwithstanding anything herein to the contrary, if a Foreign Lender is unable to provide or does not provide a Certificate of Exemption to Borrower Representative and Agent claiming an exemption from United States withholding tax within the time periods set forth in the preceding sentence, Borrowers shall withhold Taxes from payments to such Foreign Lender at the applicable statutory and treaty rates (taking into account such Foreign Lender’s compliance with applicable certification requirements), provided that all such withholding shall cease (or be reduced to the applicable treaty rate) upon delivery by such Foreign Lender of a Certificate of Exemption to Borrower Representative and Agent.

(ii)           Prior to becoming a Lender under this Agreement and on or before a previously delivered Certificate of Exemption (as defined below) expires or becomes inapplicable or obsolete, other than by reason of a change in the applicable rules as in effect at the time a Lender becomes a Lender under this Agreement, each Lender that is a “United States person” (as such term is defined in IRC Section 7701(a)(30)) for U.S. federal income tax purposes (a “US Lender”) shall provide to Borrower Representative and Agent a properly completed and executed IRS Form W-9 (certifying that such US Lender is entitled to an exemption from U.S. backup withholding tax) or any successor form.  Notwithstanding any other provision of this Section 1.11, a US Lender shall not be required to deliver any Certificate of Exemption or other certificate pursuant to this paragraph that such US Lender is not legally able to deliver.

1.12.        Application and Allocation of Payments.

(a)           So long as no Event of Default has occurred and is continuing, (i) payments consisting of proceeds of Accounts and Short-Term Rentals received by Agent in the ordinary course of business shall be applied, first, to the Swing Line Loan and, second, to the Revolving Loan; (ii) payments matching specific scheduled payments then due shall be applied to those scheduled payments; (iii) voluntary prepayments shall be applied in accordance with the provisions of Sections 1.5(a) and 1.5(e); and (iv) mandatory prepayments shall be applied as set forth in Sections 1.5(c), 1.5(d), 1.5(e) and 1.5(f);

(b)           All payments and prepayments applied to a particular Loan shall be applied ratably to the portion thereof held by each Lender as determined by its Pro Rata Share.

(c)           As to any payment not referred to in paragraph (a) or (b) of this Section 1.12, and as to all payments made when an Event of Default has occurred and is continuing or following the

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Commitment Termination Date, Borrowers hereby irrevocably waive the right to direct the application of any and all payments received from or on behalf of Borrowers, and Borrowers hereby irrevocably agree that Agent shall have the continuing exclusive right to apply any and all such payments against the Obligations as Agent may deem advisable notwithstanding any previous entry by Agent in the Loan Account or any other books and records.

(d)           In the absence of a specific determination by Agent with respect thereto, payments shall be applied to amounts then due and payable in the following order: (1) to Fees and Agent’s expenses reimbursable hereunder; (2) to interest on the Swing Line Loan; (3) to principal payments on the Swing Line Loan; (4) to interest on the other Loans and unpaid Swap Related Reimbursement Obligations, ratably in proportion to the interest accrued as to each Loan and unpaid Swap Related Reimbursement Obligation, as applicable; (5) to principal payments on the other Loans and unpaid Swap Related Reimbursement Obligations and to provide cash collateral for Letter of Credit Obligations in the manner described in Section 6.3, ratably to the aggregate, combined principal balance of the other Loans, unpaid Swap Related Reimbursement Obligations and outstanding Letter of Credit Obligations; and (6) to all other Obligations including expenses of Lenders to the extent reimbursable under Section 9.1.

1.13        Borrower Representative.  Each Borrower hereby designates Penhall (the “Borrower Representative”) as its representative and agent on its behalf for the purposes of issuing Notices of Revolving Credit Advances and Notices of Conversion/Continuation, giving instructions with respect to the disbursement of the proceeds of the Loans, selecting interest rate options, requesting Letters of Credit, giving and receiving all other notices and consents hereunder or under any of the other Loan Documents and taking all other actions (including in respect of compliance with covenants) on behalf of any Borrower or Borrowers under the Loan Documents.  Borrower Representative hereby accepts such appointment.  Agent and each Lender may regard any notice or other communication pursuant to any Loan Document from Borrower Representative as a notice or communication from all Borrowers.  Each warranty, covenant, agreement and undertaking made on its behalf by Borrower Representative shall be deemed for all purposes to have been made by such Borrower and shall be binding upon and enforceable against such Borrower to the same extent as it if the same had been made directly by such Borrower.

SECTION 2.

AFFIRMATIVE COVENANTS

Each Credit Party executing this Agreement jointly and severally agrees as to all Credit Parties that from and after the Closing Date and until the Termination Date:

2.1.          Compliance with Laws and Contractual Obligations.  Each Credit Party will (a) comply with and shall cause each of its Subsidiaries to comply with (i) the requirements of all applicable laws, rules, regulations and orders of any Governmental Authority (including, without limitation, laws, rules, regulations and orders relating to taxes, employer and employee contributions, securities, employee retirement and welfare benefits and employee health and safety) as now in effect and which may be imposed in the future in all jurisdictions in which any Credit Party or any of its Subsidiaries is now doing business or may hereafter be doing business; provided that this clause (i) shall not include environmental protection matters which shall be governed by Section 2.5 and (ii) the obligations, covenants and conditions contained in all Contractual Obligations of such Credit Party or any of its Subsidiaries other than those laws, rules, regulations, orders and provisions of such Contractual Obligations the noncompliance with which could not be reasonably expected to have, either individually or in the aggregate, a Material Adverse Effect, and (b) maintain or obtain and shall cause each of its Subsidiaries to maintain or obtain all licenses, qualifications and permits now held or hereafter required to be held by such Credit Party or any of its Subsidiaries, for which the loss, suspension, revocation or failure to obtain

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or renew, could reasonably be expected to have, either individually or in the aggregate, a Material Adverse Effect.  This Section 2.1 shall not preclude any Credit Party or its Subsidiaries from contesting any taxes or other payments, if they are being diligently contested in good faith in a manner which stays enforcement of any Lien in respect thereof and if appropriate expense provisions have been recorded in conformity with GAAP, subject to Section 3.2.  Each Credit Party represents and warrants that it (i) is in compliance and each of its Subsidiaries is in compliance with the requirements of all applicable laws, rules, regulations and orders of any Governmental Authority and the obligations, covenants and conditions contained in all Contractual Obligations other than those laws, rules, regulations, orders and provisions of such Contractual Obligations the noncompliance with which could not be reasonably expected to have, either individually or in the aggregate, a Material Adverse Effect, and (ii) maintains and each of its Subsidiaries maintains all licenses, qualifications and permits referred to above.

2.2.          Insurance; Damage to or Destruction of Collateral.

(a)           The Credit Parties shall, at their sole cost and expense, maintain the policies of insurance described on Schedule 5.18 as in effect on the Amendment Effective Date or otherwise in form and amounts and with insurers reasonably acceptable to Agent.  Such policies of insurance (or the loss payable and additional insured endorsements delivered to Agent) shall contain provisions pursuant to which the insurer agrees to provide 30 days prior written notice to Agent in the event of any non-renewal, cancellation or amendment of any such insurance policy.  If any Credit Party at any time or times hereafter shall fail to obtain or maintain any of the policies of insurance required above or to pay all premiums relating thereto, Agent may at any time or times thereafter obtain and maintain such policies of insurance and pay such premiums and take any other action with respect thereto that Agent deems advisable.  Agent shall have no obligation to obtain insurance for any Credit Party or pay any premiums therefor.  By doing so, Agent shall not be deemed to have waived any Default or Event of Default arising from any Credit Party’s failure to maintain such insurance or pay any premiums therefor.  All sums so disbursed, including reasonable attorneys’ fees, court costs and other charges related thereto, shall be payable on demand by Borrowers to Agent and shall be additional Obligations hereunder secured by the Collateral.

(b)           Agent reserves the right at any time upon any change in any Credit Party’s risk profile (including any change in the product mix maintained by any Credit Party or any laws affecting the potential liability of such Credit Party) to require additional forms and limits of insurance to, in Agent’s reasonable opinion, adequately protect both Agent’s and Lenders’ interests in all or any portion of the Collateral and to ensure that each Credit Party is protected by insurance in amounts and with coverage customary for its industry.  If reasonably requested by Agent, each Credit Party shall deliver to Agent from time to time a report of a reputable insurance broker, reasonably satisfactory to Agent, with respect to its insurance policies.

(c)           Each Credit Party shall deliver to Agent, in form and substance reasonably satisfactory to Agent, endorsements to (i) all “All Risk” and business interruption insurance naming Agent, on behalf of itself and Lenders, as loss payee or assignee, and (ii) all general liability and other liability policies naming Agent, on behalf of itself and Lenders, as additional insured.  Each Credit Party irrevocably makes, constitutes and appoints Agent (and all officers, employees or agents designated by Agent), so long as any Default or Event of Default has occurred and is continuing or the anticipated insurance proceeds exceed $2,000,000, as each Credit Party’s true and lawful agent and attorney-in-fact for the purpose of making, settling and adjusting claims under such “All Risk” policies of insurance, endorsing the name of each Credit Party on any check or other item of payment for the proceeds of such “All Risk” policies of insurance and for making all determinations and decisions with respect to such “All Risk” policies of insurance; provided that Agent shall not settle any claim without each Credit Party’s consent, such consent not to be unreasonably withheld or delayed, provided that no such consent shall be

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required while a Default or Event of Default is continuing.  Agent shall have no duty to exercise any rights or powers granted to it pursuant to the foregoing power-of-attorney.  Each Borrower shall promptly notify Agent of any loss, damage, or destruction to the Collateral in the amount of $250,000 or more, whether or not covered by insurance.  After deducting from any insurance proceeds the expenses, if any, incurred by Agent in the collection or handling thereof, Agent may, at its option, apply such proceeds to the reduction of the Obligations in accordance with Section 1.5(f), provided that in the case of insurance proceeds pertaining to any Credit Party other than a Borrower, such insurance proceeds shall be applied, in the case of a Credit Party that is a Subsidiary of Borrower, as if such Borrower owned the property that generated such proceeds and in the case of a Credit Party (other than a Borrower) that owns the Stock of a Borrower, as if any Borrower owned the property that generated such proceeds, or permit or require each Credit Party to use such money, or any part thereof, to replace, repair, restore or rebuild the Collateral in a diligent and expeditious manner with materials and workmanship of substantially the same quality as existed before the loss, damage or destruction. Notwithstanding the foregoing, if the casualty giving rise to such insurance proceeds could not reasonably be expected to have a Material Adverse Effect and such insurance proceeds do not exceed $2,000,000 in the aggregate, Agent shall permit the applicable Credit Party to replace, restore, repair or rebuild the property; provided that if such Credit Party has not completed or entered into binding agreements to complete such replacement, restoration, repair or rebuilding within 180 days of such casualty, Agent may apply such insurance proceeds to the Obligations in accordance with Section 1.5(f); provided that in the case of insurance proceeds pertaining to any Credit Party other than a Borrower, such insurance proceeds shall be applied, in the case of a Credit Party that is a Subsidiary of Borrower, as if such Borrower owned the property that generated such proceeds and in the case of a Credit Party (other than a Borrower) that owns the Stock of a Borrower, as if any Borrower owned the property that generated such proceeds, or permit or require each Credit Party to use such money, or any part thereof, to replace, repair, restore or rebuild the Collateral in a diligent and expeditious manner with materials and workmanship of substantially the same quality as existed before the loss, damage or destruction.  All insurance proceeds that are to be made available to such Borrower to replace, repair, restore or rebuild the Collateral shall be applied by Agent to reduce the outstanding principal balance of the Revolving Loan (which application shall not result in a permanent reduction of the Revolving Loan Commitment).  All insurance proceeds made available to any Credit Party that is not a Borrower to replace, repair, restore or rebuild Collateral shall be deposited in a cash collateral account.  Thereafter, such funds shall be made available to such Borrower or such Credit Party, as applicable, to provide funds to replace, repair, restore or rebuild the Collateral as follows: (i) such Borrower shall request a Revolving Credit Advance or release from the cash collateral account be made to such Borrower or such Credit Party, as applicable in the amount requested to be released; (ii) so long as the conditions set forth in Section 7.2 have been met and subject to the provisions of any Mortgage encumbering such Collateral, Revolving Lenders shall make such Revolving Credit Advance or Agent shall release funds from the cash collateral account; and (iii) in the case of insurance proceeds applied against the Revolving Loan, the Reserve established with respect to such insurance proceeds shall be reduced by the amount of such Revolving Credit Advance.  To the extent not used to replace, repair, restore or rebuild the Collateral, such insurance proceeds shall be applied in accordance with Section 1.5(f); provided that in the case of insurance proceeds pertaining to any Credit Party other than a Borrower, such insurance proceeds shall be applied, in the case of a Credit Party that is a Subsidiary of Borrower, as if such Borrower owned the property that generated such proceeds and in the case of a Credit Party (other than a Borrower) that owns the Stock of a Borrower, as if any Borrower owned the property that generated such proceeds.

2.3.          Inspection; Lender Meeting.  Each Credit Party shall permit any authorized representatives of Agent to visit, audit and inspect any of the properties of such Credit Party and its Subsidiaries, including its and their financial and accounting records, and to make copies and take extracts therefrom, and to discuss its and their affairs, finances and business with its and their officers and certified public accountants, at such reasonable times during normal business hours and as often as may

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be reasonably requested.  Representatives of each Lender will be permitted to accompany representatives of Agent during each visit, inspection and discussion referred to in the immediately preceding sentence.  Without in any way limiting the foregoing, each Credit Party will participate and will cause key management personnel of each Credit Party and its Subsidiaries to participate in a meeting with Agent and Lenders at least once during each year, which meeting shall be held at such time and such place as may be reasonably requested by Agent.

2.4.          Organizational Existence.  Except as otherwise permitted by Section 3.6, each Credit Party will and will cause its Subsidiaries to at all times preserve and keep in full force and effect its organizational existence and all rights and franchises material to its business.

2.5.          Environmental Matters.  Each Credit Party shall and shall cause each Person within its control to: (a) conduct its operations and keep and maintain its Real Estate in compliance with all Environmental Laws and Environmental Permits other than noncompliance that could not reasonably be expected to have a Material Adverse Effect; (b) implement any and all investigation, remediation, removal and response actions that are appropriate or necessary to maintain the value and marketability of the Real Estate or to otherwise comply in all material respects with Environmental Laws and Environmental Permits pertaining to the presence, generation, treatment, storage, use, disposal, transportation or Release of any Hazardous Material on, at, in, under, above, to, from or about any of its Real Estate; (c) notify Agent promptly after such Credit Party or any Person within its control becomes aware of any violation of Environmental Laws or Environmental Permits or any Release on, at, in, under, above, to, from or about any Real Estate that is reasonably likely to result in Environmental Liabilities to a Credit Party or its Subsidiaries in excess of $100,000; and (d) promptly forward to Agent a copy of any order, notice, request for information or any communication or report received by such Credit Party or any Person within its control in connection with any such violation or Release or any other matter relating to any Environmental Laws or Environmental Permits that could reasonably be expected to result in Environmental Liabilities in excess of $100,000, in each case whether or not the Environmental Protection Agency or any Governmental Authority has taken or threatened any action in connection with any such violation, Release or other matter.  If Agent at any time has a reasonable basis to believe that there may be a violation of any Environmental Laws or Environmental Permits by any Credit Party or any Person under its control or any Environmental Liability arising thereunder, or a Release of Hazardous Materials on, at, in, under, above, to, from or about any of its Real Estate, that, in each case, could reasonably be expected to have a Material Adverse Effect, then each Credit Party and its Subsidiaries shall, upon Agent’s written request (i) cause the performance of such environmental audits including subsurface sampling of soil and groundwater, and preparation of such environmental reports, at Borrowers’ expense, as Agent may from time to time reasonably request, which shall be conducted by reputable environmental consulting firms reasonably acceptable to Agent and shall be in form and substance reasonably acceptable to Agent, and (ii) permit Agent or its representatives to have access to all Real Estate for the purpose of conducting such environmental audits and testing as Agent deems appropriate, including subsurface sampling of soil and groundwater.  Borrowers shall reimburse Agent for the costs of such audits and tests and the same will constitute a part of the Obligations secured hereunder.

2.6.          Landlords’ Agreements, Mortgagee Agreements, Bailee Letters and Real Estate Purchases.  Each Credit Party shall use reasonable efforts to obtain a landlord’s agreement, mortgagee agreement or bailee letter, as applicable, from the lessor of each leased property, mortgagee of owned property or bailee with respect to any warehouse, processor or converter facility or other location where Collateral is stored or located, which agreement or letter shall contain a waiver or subordination of all Liens or claims that the landlord, mortgagee or bailee may assert against the Collateral at that location, and shall otherwise be reasonably satisfactory in form and substance to Agent. With respect to such locations or warehouse space leased or owned as of the Closing Date and thereafter, if Agent has not received a landlord or mortgagee agreement or bailee letter as of the Closing Date (or, if later, as of the

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date such location is acquired or leased), the Eligible Parts and Supplies and Eligible Equipment at that location shall, in Agent’s discretion, be subject to such Reserves as may be established by Agent in its reasonable credit judgment.  After the Amendment Effective Date, no real property or warehouse space shall be leased by any Credit Party or its Subsidiary and no Parts and Supplies shall be shipped to a processor or converter under arrangements established after the Amendment Effective Date without the prior written consent of Agent (which consent, in Agent’s discretion, may be conditioned upon the exclusion from the Borrowing Base of Eligible Parts and Supplies and Eligible Equipment at that location or the establishment of Reserves acceptable to Agent) or, unless and until a reasonably satisfactory landlord agreement or bailee letter, as appropriate, shall first have been obtained with respect to such location.  Each Credit Party shall and shall cause its Subsidiaries to timely and fully pay and perform their obligations under all leases and other agreements with respect to each leased location or public warehouse where any Collateral is or may be located except for such obligations being diligently contested in good faith and in respect of which, if appropriate, expense provisions have been recorded in accordance with GAAP.

2.7.          Conduct of Business.  Each Credit Party shall at all times maintain, preserve and protect all of its assets and properties used or useful in the conduct of its business, and keep the same in good repair, working order and condition in all material respects (taking into consideration ordinary wear and tear) and from time to time make, or cause to be made, all necessary or appropriate repairs, replacements and improvements thereto consistent with industry practices; continue to conduct its business substantially as now conducted or as otherwise permitted hereunder; and transact business only in such limited liability company, corporate and trade names as are set forth in Schedule 2.7, which schedule may be updated by the Credit Parties from time to time with twenty (20) days’ prior written notice to Agent.

2.8.          Further Assurances.

(a)           Each Credit Party shall, from time to time, execute or authorize the execution of such guaranties, financing statements, documents, control agreements, security agreements and reports as Agent or Requisite Lenders at any time may reasonably request to evidence, perfect or otherwise implement the guaranties and security for repayment of the Obligations contemplated by the Loan Documents.

(b)           Promptly, and in any event within ten (10) days after the Amendment Effective Date, for all motor vehicles owned by each Credit Party as of the Amendment Effective Date that are covered by a certificate of title and as to which the lien of the Agent is not noted thereon, such Credit Party shall submit for reissuance with the appropriate state motor vehicle office such motor vehicle title certificates with Agent’s Lien noted thereon.

(c)           Each Credit Party shall, from time to time, cause all chattel paper (excluding written lease agreements governing Short-Term Rentals) owned by such Credit Party to be conspicuously legended to indicate that it is subject to a lien in favor of Agent.

(d)           In the event any Credit Party acquires an ownership interest in real property after the Amendment Effective Date, such Credit Party shall deliver to Agent a fully executed mortgage or deed of trust over such real property in form and substance similar to the Mortgages delivered concurrently herewith, with such variations as may be reasonably required by Agent in order to conform to and/or take advantage of laws of the state in which such real property is located, together with such title insurance policies, surveys, appraisals, evidence of insurance, legal opinions, environmental assessments and other documents and certificates as shall be reasonably required by Agent.

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(e)           Promptly, and in any event within 30 days after the acquisition by Borrowers or its Subsidiaries of assets or personal property of the type that would have constituted Collateral on the Amendment Effective Date and investments of the type that would have constituted Collateral on the Amendment Effective Date, Borrowers will take, or will cause their Subsidiaries to take, all necessary action, including (i) the filing of appropriate financing statements under the applicable provisions of the UCC, applicable foreign, domestic or local laws, rules or regulations in each of the offices where such filing is necessary or appropriate, (ii) the execution and delivery of Control Agreements, and (iii) the notation of the Lien of Agent on any certificate of title, in each case, to create and perfect a perfected Lien in such Collateral (or comparable interest under foreign law in the case of foreign Collateral) pursuant to and to the full extent required by the Security Agreements and this Agreement.

(f)            Each Credit Party shall (i) cause each Person, upon its becoming a Subsidiary of such Credit Party (provided that this shall not be construed to constitute consent by any of the Lenders to any transaction referred to above which is not expressly permitted by the terms of this Agreement), promptly to guaranty the Obligations and to grant to Agent, for the benefit of Agent and Lenders, a security interest in the real, personal and mixed property of such Person to secure the Obligations and (ii) pledge, or cause to be pledged, to Agent, for the benefit of Agent and Lenders, all of the Stock of such Subsidiary to secure the Obligations.  The documentation for such guaranty, security and pledge shall be substantially similar to the Loan Documents executed concurrently herewith with such modifications as are reasonably requested by Agent and shall be accompanied by such legal opinions and other documents as Agent may reasonably request.  Notwithstanding the foregoing, in the event that a Person becomes a Subsidiary of a Borrower and such Person is a “controlled foreign corporation”, as defined in Section 957(a) of the IRC (a “CFC”), of such Borrower, then such Borrower shall (a) not be obligated to cause such CFC to comply with clause (i) of this subsection (e) and nothing in this Agreement shall cause any CFC to have any obligation under this Agreement, and (b) pledge or cause to be pledged one hundred percent (100%) of the non-voting Stock of such CFC and no more than sixty-five percent (65%) of all of the voting Stock of such CFC, provided that, Borrower shall not be obligated to pledge or cause to be pledged any assets owned by any CFC (including the Stock of such CFC owned by another CFC).

2.9.          Amendment of Preferred Stock Terms.  Not later than thirty (30) days following the Amendment Effective Date Holdings shall complete an amendment, in form and substance reasonably satisfactory to Agent, of the terms of Holdings’ Series A Preferred Stock in order eliminate the mandatory redemption provisions contained therein.

2.10.        Cash Management Systems. Credit Parties shall, and shall cause each of their Subsidiaries to, enter into Control Agreements with respect to each deposit account maintained by any Credit Party or any Subsidiary of any Credit Party as of or after the Closing Date.  Each such Control Agreement shall be in form and substance satisfactory to Agent.  Borrowers shall enter into lockbox agreements in form and substance and with banks acceptable to Agent and shall direct all Account Debtors to make payments on all Accounts into the lockboxes established under such agreements.  All payments received in the lockboxes shall promptly, subject to Section 6.5, (i) first, be applied to the outstanding Obligations other than Letter of Credit Obligations, until paid in full and (ii) second, following such payment in full, be remitted to the Borrowers.

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SECTION 3.

NEGATIVE COVENANTS

Each Credit Party executing this Agreement jointly and severally agrees as to all Credit Parties that from and after the Amendment Effective Date until the Termination Date:

3.1.          Indebtedness.  The Credit Parties shall not and shall not cause or permit their Subsidiaries directly or indirectly to create, incur, assume, or otherwise become or remain directly or indirectly liable with respect to any Indebtedness (other than pursuant to a Contingent Obligation permitted under Section 3.4) except:

(a)           the Obligations;

(b)           Indebtedness outstanding on the Amendment Effective Date described in Schedule 3.1 and refinancings thereof or amendments or modifications thereto that do not have the effect of increasing the principal amount thereof or changing the amortization thereof (other than to extend the same) and that are otherwise on terms and conditions no less favorable to any Credit Party than the terms of the Indebtedness being refinanced, amended or modified;

(c)           Indebtedness consisting of intercompany loans and advances made by any Borrower to another Borrower; provided, that:  (i) such obligor Borrower shall have executed and delivered to each such obligee Borrower, a demand note (as amended, modified, extended, substituted or replaced from time to time, an “Intercompany Note” and, collectively the “Intercompany Notes”) to evidence any such intercompany Indebtedness owing at any time by such obligor Borrower to such obligee Borrower, which Intercompany Notes shall be substantially in the form of Exhibit 3.1(c) and shall be pledged and delivered to Agent pursuant to the applicable Pledge Agreement or Security Agreement as additional collateral security for the Obligations; (ii) such obligee Borrower shall record all intercompany transactions on its books and records in a manner reasonably satisfactory to Agent; (iii) the obligations of such obligor Borrower under any such Intercompany Notes shall be subordinated to the Obligations of such obligor Borrower hereunder pursuant to Section 9.21;  (iv) at the time any such intercompany loan or advance is made to such obligor Borrower and after giving effect thereto, such obligor Borrower shall be Solvent; (v) no Default or Event of Default would occur and be continuing after giving effect to any such proposed intercompany loan; (vi) such obligor Borrower shall have Borrowing Availability of not less than $1.00 after giving effect to such intercompany loan; and (vii) such obligor Borrower shall be creditworthy as determined by Agent.

(d)           Second Lien Debt incurred by Borrowers in an amount not to exceed $105,000,000 in aggregate principal amount at any time outstanding, less any repayments of principal thereunder (other than any repayment made from proceeds of a Permitted Refinancing of Second Lien Debt);

(e)           until the date forty-five (45) days following the Amendment Effective Date Indebtedness under the Senior Unsecured Notes not to exceed $100,000,000 in aggregate principal amount, less principal payments made thereon; so long as concurrently with the making of the loan under the Second Lien Credit Agreement, Holdings deposits cash proceeds thereof with the trustee for the Senior Unsecured Notes in an amount sufficient to pay the redemption price of all Senior Unsecured Notes;

(f)            Indebtedness at any time outstanding secured by purchase money Liens or incurred with respect to Capital Leases which does not exceed $4,000,000 in aggregate principal amount (or notional principal) at any time outstanding;

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(g)           Indebtedness incurred by a Credit Party as a Permitted Refinancing of Second Lien Debt, so long as the proceeds of such Indebtedness are applied to repay principal thereof and to pay accrued interest and fees on the Second Lien Debt being repaid, and transaction expenses (including closing fees) incurred in connection with such Indebtedness and so long as after giving effect to any such incurrence Holdings and its Subsidiaries on a pro forma Consolidated Basis are in compliance with Section 4.6;

(h)           surety bonds entered into in the ordinary course of business or which are secured by collateral which is a Permitted Encumbrance;

(i)            any other Indebtedness not to exceed $500,000 in aggregate principal amount at any time outstanding; or

(j)            Indebtedness permitted by Section 3.6(b)(iv)(B).

3.2.          Liens and Related Matters.

(a)           No Liens.  The Credit Parties shall not and shall not cause or permit their Subsidiaries to directly or indirectly create, incur, assume or permit to exist any Lien on or with respect to any property or asset of such Credit Party or any such Subsidiary, whether now owned or hereafter acquired, or any income or profits therefrom, except Permitted Encumbrances (including, without limitation, those Liens constituting Permitted Encumbrances existing on the Amendment Effective Date hereof and renewals and extensions thereof, as set forth on Schedule 3.2).

(b)           No Negative Pledges.  The Credit Parties shall not and shall not cause or permit their Subsidiaries to directly or indirectly enter into or assume any agreement (other than the Loan Documents, the Second Lien Loan Documents as in effect on the Amendment Effective Date (as to the assets covered thereby), and other secured Indebtedness permitted by this Agreement so long as the agreements with respect to such other secured Indebtedness do not prohibit any Permitted Encumbrances) prohibiting the creation or assumption of any Lien upon its properties or assets, whether now owned or hereafter acquired.

(c)           No Restrictions on Subsidiary Distributions to Borrowers.  Except as provided herein and in the Second Lien Credit Agreement, the Credit Parties shall not and shall not cause or permit their Subsidiaries to directly or indirectly create or otherwise cause or suffer to exist or become effective any consensual encumbrance or restriction of any kind on the ability of any such Subsidiary to: (1) pay dividends or make any other distribution on any of such Subsidiary’s Stock owned by any Borrower or any other Subsidiary; (2) pay any Indebtedness owed to any Borrower or any other Subsidiary; (3) make loans or advances to any Borrower or any other Subsidiary; or (4) transfer any of its property or assets to any Borrower or any other Subsidiary.

3.3.          Investments.  The Credit Parties shall not and shall not cause or permit their Subsidiaries to directly or indirectly make or own any Investment in any Person except:

(a)           Borrowers and their Subsidiaries may make and own Investments in Cash Equivalents subject to Control Agreements in favor of Agent; provided that such Cash Equivalents are not subject to setoff rights;

(b)           Borrowers may make intercompany loans to other Borrowers to the extent permitted under Section 3.1;

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(c)           Borrowers and their Subsidiaries may make loans and advances to employees for moving, entertainment, travel and other similar expenses in the ordinary course of business not to exceed $100,000 in the aggregate at any time outstanding;

(d)           Borrowers and their Subsidiaries may make capital contributions to their wholly owned Domestic Subsidiaries that are Guarantors in an amount not to exceed $250,000 in the aggregate reduced by the amount of Investments made pursuant to Section 3.1(c);

(e)           Borrowers and their Subsidiaries may own the Investments listed on Schedule 3.3(e) and outstanding on the Amendment Effective Date;

(f)            Borrowers may make investments constituting Permitted Acquisitions; and

(g)           transfers between Credit Parties permitted pursuant to this Section 3.

3.4.          Contingent Obligations.  The Credit Parties shall not and shall not cause or permit their Subsidiaries to directly or indirectly create or become or be liable with respect to any Contingent Obligation except:

(a)           Letter of Credit Obligations;

(b)           omitted;

(c)           those resulting from endorsement of negotiable instruments for collection in the ordinary course of business;

(d)           those arising with respect to a Credit Party guaranteeing the Indebtedness of another Credit Party so long as, in the event such guaranteed Indebtedness is subordinated, such guarantee shall be equally subordinated;

(e)           those existing on the Amendment Effective Date and described in Schedule 3.4;

(f)            those arising under indemnity agreements to title insurers to cause such title insurers to issue to Agent mortgagee title insurance policies;

(g)           those arising with respect to customary indemnification obligations incurred in connection with Asset Dispositions permitted hereunder;

(h)           those incurred in the ordinary course of business with respect to surety and appeal bonds, performance and return-of-money bonds and other similar obligations;

(i)            those incurred with respect to the Second Lien Debt, other Indebtedness of a Credit Party permitted by Section 3.1 and other obligations of a Credit Party not prohibited hereunder, provided that any such Contingent Obligation is subordinated to the Obligations to the same extent as the Indebtedness to which it relates is subordinated to the Obligations;

(j)            any other Contingent Obligation not expressly permitted by clauses (a) through (h) above, so long as any such other Contingent Obligations, in the aggregate at any time outstanding, do not exceed $1,000,000.

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3.5.          Restricted Payments.  The Credit Parties shall not and shall not cause or permit their Subsidiaries to directly or indirectly declare, order, pay, make or set apart any sum for any Restricted Payment, except that:

(a)           Omitted;

(b)           Omitted;

(c)           Wholly owned Subsidiaries of a Borrower may make Restricted Payments to such Borrower;

(d)           Borrower may make Restricted Payments with respect to the payment of accrued dividends on and redemption of the issued and outstanding Senior Preferred Stock being redeemed within 45 days of the Amendment Effective Date in accordance with its terms as in effect on the Amendment Effective Date;

(e)           Borrowers may pay management fees and reasonable out-of-pocket expenses payable semi-annually pursuant to the BRS Management Services Agreement and management fees and reasonable out of pocket expenses payable monthly pursuant to the Company Management Services Agreement as in effect on the Closing Date; provided that no Default or Event of Default exists at the time of any such Restricted Payment or would occur as a result thereof; and

(f)            So long as no Default or Event of Default is continuing, Holdings may repurchase Stock owned by employees, officers or directors of the Borrowers or any of their Subsidiaries or their authorized representatives upon the death, disability or termination of employment of such employees, officers or directors, or as otherwise required by existing employment agreements, in an aggregate amount not to exceed (x) one million dollars ($1,000,000) in any calendar year or (y) three million dollars ($3,000,000) during the term of this Agreement, plus, in the case of the limit imposed by clause (x), (i) the aggregate cash proceeds actually received from any reissuance of Stock during such calendar year by the Borrowers or any of their Subsidiaries to employees, officers or directors of the Borrowers or their Subsidiaries and (ii) the aggregate cash proceeds actually received in such calendar year from any payments on life insurance policies in which the Borrowers or any of their Subsidiaries is the beneficiary with respect to any employees, officers or directors of the Borrowers or any of their Subsidiaries which proceeds are used to purchase the Stock of the Borrowers or any of their Subsidiaries held by any such employees, officers or directors, plus, in the case of the limit imposed by clause (y) the aggregate amount received by Borrowers under paragraphs (i) and (ii) of this Section 3.5(f) during the term of this Agreement.

3.6.          Restriction on Fundamental Changes; Permitted Acquisitions.

(a)           The Credit Parties shall not and shall not cause or permit their Subsidiaries to directly or indirectly:

(i)            amend, modify or waive any term or provision of its organizational documents, including its articles of incorporation, certificates of designations pertaining to preferred stock, (other than the amendment referred to in Section 2.9) by-laws, partnership agreement or operating agreement in any way adversely affecting the Lenders unless required by law;

(ii)           enter into any transaction of merger or consolidation except, upon not less than five (5) Business Days’ prior written notice to Agent, any wholly owned Subsidiary of a Borrower may be merged with or into any other wholly owned Subsidiary of such Borrower (and in

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connection therewith Borrower will take such action as may be required to preserve and protect the Liens of the Agent on the Collateral), provided that if the Subsidiary so merged is a Credit Party, the surviving company shall be a Credit Party;

(iii)          liquidate, wind-up or dissolve itself (or suffer any liquidation or dissolution); or

(iv)          acquire by purchase or otherwise all or any substantial part of the business or assets of any other Person except as set forth in paragraph (b) below.

(b)           Borrowers may acquire all or substantially all of the assets or Stock of any Person (the “Target”) (in each case, a “Permitted Acquisition”) subject to the satisfaction of each of the following conditions:

(i)            Agent shall receive at least thirty (30) Business Days’ prior written notice of such proposed Permitted Acquisition, which notice shall include a reasonably detailed description of such proposed Permitted Acquisition;

(ii)           such Permitted Acquisition shall only involve assets located in the United States or Canada and comprise a business, or those assets of a business, of the type engaged in by Borrowers as of the Amendment Effective Date, and which business would not subject Agent or any Lender to regulatory or third party approvals in connection with the exercise of its rights and remedies under this Agreement or any other Loan Documents other than approvals applicable to the exercise of such rights and remedies with respect to Borrowers prior to such Permitted Acquisition;

(iii)          such Permitted Acquisition shall be consensual and shall have been approved by the Target’s board of directors and Borrower and Target (and the seller thereof) shall have received all necessary regulatory and third-party approvals in connection with such Permitted Acquisition;

(iv)          no additional Indebtedness, Guaranteed Indebtedness, Contingent Obligations or other liabilities shall be incurred, assumed or otherwise be reflected on a consolidated balance sheet of Borrowers and Target after giving effect to such Permitted Acquisition, except (A) Loans made hereunder, (B) Indebtedness issued to seller in such Permitted Acquisition (so long as such Indebtedness (x) is either unsecured or secured only by assets (other than Stock) being acquired in such Permitted Acquisition and (y) together with all other such Indebtedness issued to sellers in Permitted Acquisitions, does not exceed $1,000,000 in aggregate principal amount) and (C) ordinary course trade payables, accrued expenses and unsecured Indebtedness of the Target to the extent no Default or Event of Default has occurred and is continuing or would result after giving effect to such Permitted Acquisition;

(v)           the sum of all amounts payable by Borrower and its Subsidiaries in connection with all Permitted Acquisitions during the term hereof (including all transaction costs and all Indebtedness, liabilities and Contingent Obligations incurred or assumed in connection therewith or otherwise reflected on a consolidated balance sheet of Borrowers and Target) shall not exceed $2,000,000 and the portion thereof allocable to goodwill and intangible assets for all such Permitted Acquisitions during any Fiscal Year shall not exceed $1,000,000;

(vi)          the Target’s EBITDA for the trailing twelve-month period preceding the date of the Permitted Acquisition, as determined based upon the Target’s financial statements for its most recently completed Fiscal Year and its most recent interim financial period completed within sixty (60) days prior to the date of consummation of such Permitted Acquisition shall not be negative;

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(vii)         the business and assets acquired in such Permitted Acquisition shall be free and clear of all Liens (other than Permitted Encumbrances);

(viii)        at or prior to the closing of any Permitted Acquisition, Agent will be granted a first priority (except in those assets acquired from a seller securing Indebtedness issued to such seller as permitted by clause (iv)(B) above) perfected Lien (subject to Permitted Encumbrances) in all assets acquired pursuant thereto or in the assets and Stock of the Target, and Holdings and Borrowers and the Target shall have executed such documents and taken such actions as may be required by Agent in connection therewith;

(ix)           concurrently with delivery of the notice referred to in clause (i) above, Borrowers shall have delivered to Agent, in form and substance reasonably satisfactory to Agent:

(A)          a pro forma consolidated balance sheet, income statement and cash flow statement of Holdings and its Subsidiaries (the “Acquisition Pro Forma”), based on recent financial statements, which shall be complete and shall fairly present in all material respects the assets, liabilities, financial condition and results of operations of Holdings and its Subsidiaries in accordance with GAAP consistently applied, but taking into account such Permitted Acquisition and the funding of all Loans in connection therewith, and such Acquisition Pro Forma shall reflect that (x) on a pro forma basis, Holdings and its Subsidiaries would have had a Leverage Ratio not in excess of 1.2 to 1.0 for the four quarter period reflected in the Compliance and Pricing Certificate most recently delivered to Agent pursuant to Section 4.9(l) prior to the consummation of such Permitted Acquisition (after giving effect to such Permitted Acquisition and all Loans funded, and other Indebtedness issued, assumed, incurred or guaranteed, in connection therewith as if made on the first day of such period), (y) average daily Borrowing Availability for the ninety (90) day period preceding the consummation of such Permitted Acquisition would have exceeded $10,000,000 on a pro forma basis (after giving effect to such Permitted Acquisition and all Loans funded in connection therewith as if made on the first day of such period) and the Acquisition Projections (as hereinafter defined) shall reflect that such Borrowing Availability of $10,000,000 shall continue for at least ninety (90) days after the consummation of such Permitted Acquisition, and (z) on a pro forma basis, no Event of Default has occurred and is continuing or would result after giving effect to such Permitted Acquisition and Borrowers would have been in compliance with the financial covenants set forth in Section 4 for the four quarter period reflected in the Compliance and Pricing Certificate most recently delivered to Agent pursuant to Section 4.9(l) prior to the consummation of such Permitted Acquisition (after giving effect to such Permitted Acquisition and all Loans funded, and other Indebtedness issued, assumed, incurred or guaranteed, in connection therewith as if made on the first day of such period);

(B)           updated versions of the most recently delivered Projections covering the three (3) year period commencing on the date of such Permitted Acquisition and otherwise prepared in accordance with the Projections (the “Acquisition Projections”) and based upon historical financial data of a recent date reasonably satisfactory to Agent, taking into account such Permitted Acquisition; and

(C)           a certificate of the chief financial officer of Borrower Representative to the effect that: (w) Borrowers (after taking into consideration all rights of contribution and indemnity Borrower has against Holdings and each other Subsidiary of Holdings) will be Solvent upon the consummation of the Permitted Acquisition; (x) the Acquisition Pro Forma fairly presents the financial condition of Holdings and its Subsidiaries (on a consolidated basis) as of the date thereof after giving effect to the Permitted Acquisition; (y) the Acquisition Projections are reasonable estimates of the future financial performance of Holdings and its Subsidiaries subsequent to the date thereof based upon the historical performance of Holdings and its Subsidiaries and the Target and show that Holdings and its Subsidiaries shall continue to be in compliance with the financial covenants set forth in Section 4 for the

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three (3) year period thereafter; and (z) Holdings and its Subsidiaries have completed their due diligence investigation with respect to the Target and such Permitted Acquisition, which investigation was conducted in a manner similar to that which would have been conducted by a prudent purchaser of a comparable business and the results of which investigation were delivered to Agent and Lenders;

(x)            on or prior to the date of such Permitted Acquisition, Agent shall have received, in form and substance reasonably satisfactory to Agent, copies of the acquisition agreement and related agreements and instruments, and all opinions, certificates, lien search results and other documents reasonably requested by Agent, including those specified in Section 2.8(e); and

(xi)           at the time of such Permitted Acquisition and after giving effect thereto, no Default or Event of Default has occurred and is continuing.

Notwithstanding the foregoing, the Accounts, Short-Term Rentals, Parts and Supplies, Equipment and Real Estate of the Target shall not be included in Eligible Accounts, Eligible Short-Term Rentals, Eligible Parts and Supplies, Eligible Equipment and Eligible Real Estate without the prior written consent of Agent and Requisite Lenders.  Notwithstanding the foregoing, in the event that Stock of Target is acquired in such Permitted Acquisition, no such property shall be included in the Aggregate Borrowing Base unless (i) such Target becomes a Borrower under this Agreement pursuant to an accession or similar agreement in form and substance satisfactory to Agent, (ii) such Target shall have delivered in connection therewith such documents, certificates and legal opinions as Agent shall have reasonably requested in connection with such agreement and (iii) this Agreement shall have been amended in a manner satisfactory to Agent and Requisite Lenders in order to introduce into the Aggregate Borrowing Base a separate Borrowing Base for such Target (including applicable definitions thereof and a Borrowing Base Certificate therefor).

3.7.          Disposal of Assets or Subsidiary Stock.  Except as described on Schedule 3.7, the Credit Parties shall not and shall not cause or permit their Subsidiaries to directly or indirectly convey, sell, lease, sublease, license, assign, transfer or otherwise dispose of, or grant any Person an option to acquire, in one transaction or a series of related transactions, any of its property, business or assets, whether now owned or hereafter acquired, except for (a) sales of inventory in good faith to customers for fair value in the ordinary course of business and dispositions of Equipment and Parts and Supplies not used or useful in the business, (b) Asset Dispositions by Borrowers and their Subsidiaries (excluding sales of Accounts and Stock of any of Holdings’ Subsidiaries) if all of the following conditions are met:  (i) the market value of assets sold or otherwise disposed of in any single transaction or series of related transactions does not exceed $100,000 and the aggregate market value of assets sold or otherwise disposed of in any Fiscal Year does not exceed $250,000; (ii) the consideration received is at least equal to the fair market value of such assets; (iii) the sole consideration received is cash; (iv) the Net Proceeds of such Asset Disposition are applied as required by Sections 1.5(c) and (d), as applicable; (v) after giving effect to the Asset Disposition and the repayment of Indebtedness with the proceeds thereof, Borrowers are in compliance on a pro forma basis with the covenants set forth in Section 4 recomputed for the most recently ended Fiscal Quarter for which information is available and is in compliance with all other terms and conditions of this Agreement; and (vi) no Default or Event of Default then exists or would result from such Asset Disposition and (c) Permitted Sale-Leasebacks.

3.8.          Transactions with Affiliates.  The Credit Parties shall not and shall not cause or permit their Subsidiaries to directly or indirectly enter into or permit to exist any transaction (including the purchase, sale, lease or exchange of any property or the rendering of any management, consulting, investment banking, advisory or other similar services) with any Affiliate or with any director, officer or employee of any Credit Party, except (a) as set forth on Schedule 3.8, (b) transactions in the ordinary course of and pursuant to the reasonable requirements of the business of any such Credit Party or any of

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its Subsidiaries and upon fair and reasonable terms which are fully disclosed to Agent and are no less favorable to any such Credit Party or any of its Subsidiaries than would be obtained in a comparable arm’s length transaction with a Person that is not an Affiliate, (c) payment of reasonable compensation to officers and employees for services actually rendered to any such Credit Party or any of its Subsidiaries, (d) payment of director’s fees not to exceed $100,000 in the aggregate for any Fiscal Year of Holdings and (e) upon notice to Agent, transfers of assets by any Borrower to any other Borrower, provided that (i) if such assets are covered by a negotiable document of title, such document shall be delivered to Agent with all necessary endorsements, free and clear of all Liens except those in favor of Agent and Lenders, (ii) if such assets are covered by a certificate of title, such certificate of title shall be re-issued in the name of the transferee Borrower and the Lien of Agent shall be noted on such certificate of title in accordance with applicable state law, and (iii) if such assets constitute real property, such real property shall be free and clear of all Liens and rights of any other Person, except the Lien in favor of Agent and Lenders and Permitted Encumbrances of the type described in clause (a), (d), (e), (g), (h), (j) or (l) of the definition of such term, and Agent shall have received a loan policy of title insurance in favor of Agent and in form and amount, and issued by a title insurance company satisfactory to Agent in its reasonable discretion, together with such endorsements thereto as Agent shall require in its reasonable discretion, provided further, that in each instance, the transfer of ownership from the transferor Borrower to the transferee Borrower shall be recorded in accordance with applicable law.  Concurrently with any such transfer, the transferor Borrower shall repay any Revolving Credit Advances or cash collateralize Letter of Credit Obligations necessitated by the reduction in its Borrowing Base and, in the event any such transferred assets include any assets included in the transferor’s most recent Borrowing Base Certificate, at least five (5) Business Days’ prior to consummating such transfer, such transferor Borrower shall deliver to Agent a pro forma Borrowing Base Certificate taking into account such transfer.

3.9.          Conduct of Business.  The Credit Parties shall not and shall not cause or permit their Subsidiaries to directly or indirectly engage in any business other than businesses of the type described on Schedule 3.9.

3.10.        Changes Relating to Indebtedness.  The Credit Parties shall not and shall not cause or permit their Subsidiaries to directly or indirectly change or amend the terms of any of its Indebtedness (a) permitted by Section 3.1(b), Section 3.1(f) or Section 3.1(i) if the effect of such amendment is to: (i) increase the interest rate on such Indebtedness; (ii) change the dates upon which payments of principal or interest are due on or principal amount of such Indebtedness; (iii) change any event of default or add or make more restrictive any covenant with respect to such Indebtedness; (iv) change the redemption or prepayment provisions of such Indebtedness; (v) change the subordination provisions thereof (or the subordination terms of any guaranty thereof); (vi) change or amend any other term if such change or amendment would materially increase the obligations of the obligor or confer additional material rights on the holder of such Indebtedness in a manner adverse to any Credit Party or Lenders; or (vii) increase the portion of interest payable in cash with respect to any Indebtedness for which interest is payable by the issuance of payment-in-kind notes or is permitted to accrue or (b) permitted by Section 3.1(d) in a manner prohibited by the Intercreditor Agreement.

3.11.        Change of Name or Location. No Credit Party shall (a) change its name as it appears in official filings in the state of its incorporation or organization, (b) change its offices or warehouses or locations at which Collateral is held or stored, or the location of its records concerning the Collateral, (c) change the type of entity that it is, (d) change its organization identification number, if any, issued by its state of incorporation or organization, or (e) change its state of incorporation or organization, in each case without at least thirty (30) days’ prior written notice to Agent and after Agent’s written acknowledgment, which shall not be unreasonably delayed, that any reasonable action requested by Agent in connection therewith, including to continue the perfection of any Liens in favor of Agent, on behalf of Lenders, in any Collateral, has been completed or taken; provided that any such new location shall be in the

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continental United States.  Without limiting the foregoing, no Credit Party shall change its name, identity or limited liability company (or corporate, as the case may be) structure in any manner that might make any financing or continuation statement filed in connection herewith seriously misleading within the meaning of Section 9-506 or 9-507 of the Code or any other then applicable provision of the Code except upon prior written notice to Agent and Lenders and after Agent’s written acknowledgment that any reasonable action requested by Agent in connection therewith, including to continue the perfection of any Liens in favor of Agent, on behalf of Lenders, in any Collateral, has been completed or taken.

3.12.        Fiscal Year.  No Credit Party shall change its Fiscal Year or permit any of its Subsidiaries to change their respective fiscal years.

3.13.        Press Release; Public Offering Materials.  Each Credit Party executing this Agreement agrees that neither it nor its Affiliates will in the future issue any press releases or other public disclosure, including any prospectus, proxy statement or other materials filed with any Governmental Authority relating to a public offering of the Stock of any Credit Party, using the name of GE Capital or its affiliates or referring to this Agreement, the other Loan Documents or the Related Transactions Documents without at least two (2) Business Days’ prior notice to GE Capital and without the prior written consent of GE Capital unless (and only to the extent that) such Credit Party or Affiliate is required to do so under law and then, in any event, such Credit Party or Affiliate will consult with GE Capital before issuing such press release or other public disclosure.  Each Credit Party consents to the publication by Agent or any Lender of a tombstone or similar advertising material relating to the financing transactions contemplated by this Agreement.  Agent or such Lender shall provide a draft of any such tombstone or similar advertising material to each Credit Party for review and comment prior to the publication thereof.  Agent reserves the right to provide to industry trade organizations information necessary and customary for inclusion in league table measurements.  Notwithstanding the foregoing, the parties hereto may disclose the United States federal tax treatment and tax structure of the transactions contemplated by the Loan Documents as further provided in Section 9.13.

3.14.        Subsidiaries.  The Credit Parties shall not and shall not cause or permit their Subsidiaries to directly or indirectly establish, create or acquire any new Subsidiary except in connection with Permitted Acquisitions.

3.15.        Bank Accounts.  The Credit Parties shall not and shall not cause or permit their Subsidiaries to establish any new bank accounts without prior written notice to Agent and unless Agent and the bank at which the account is to be opened enter into a Control Agreement regarding such bank account in form and substance satisfactory to Agent.  No Credit Party shall and no Credit Party shall cause or permit any of its Subsidiaries to establish after the Amendment Effective Date any securities account or commodities account other than a securities account or commodities account subject to a Control Agreement in favor of Agent and in form and substance satisfactory to Agent.

3.16.        Hazardous Materials.  The Credit Parties shall not and shall not cause or permit their Subsidiaries to cause or permit a Release of any Hazardous Material on, at, in, under, above, to, from or about any of the Real Estate where such Release would (a) violate in any respect, or form the basis for any Environmental Liabilities by the Credit Parties or any of their Subsidiaries under, any Environmental Laws or Environmental Permits or (b) otherwise adversely impact the value or marketability of any of the Real Estate or any of the Collateral, other than such violations or Environmental Liabilities that could not reasonably be expected to have a Material Adverse Effect.

3.17.        ERISA.  The Credit Parties shall not and shall not cause or permit any ERISA Affiliate to, cause or permit to occur an ERISA Event to the extent such ERISA Event could reasonably be expected to have a Material Adverse Effect.

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3.18.        Sale-Leasebacks.  The Credit Parties shall not and shall not cause or permit any of their Subsidiaries to engage in any sale-leaseback, synthetic lease or similar transaction involving any of its assets except for Permitted Sale-Leasebacks.

3.19.        Prepayments of Other Indebtedness.  The Credit Parties shall not, directly or indirectly, voluntarily purchase, redeem, defease or prepay any principal of, premium, if any, interest or other amount payable in respect of any Indebtedness, other than (i) the Obligations; (ii) Indebtedness secured by a Permitted Encumbrance if the asset securing such Indebtedness has been sold or otherwise disposed of in accordance with Section 3.7(b) and a prepayment of such Indebtedness is required in respect of such sale or disposition, and (iii) intercompany Indebtedness reflecting amounts owing to Borrowers.  Credit Parties shall not make any prepayments or repayments of principal of the Second Lien Debt, other than Permitted Second Lien Prepayments or any prepayments of any Permitted Refinancing of Second Lien Debt described in clause (ii) of the definition of such term, that are substantially the same as Permitted Second Lien Prepayments.

3.20.        Changes to Management Services Agreements.  The Credit Parties shall not and shall not cause or permit any of their Subsidiaries to change or amend the terms of the Management Services Agreements.

3.21.        Changes in Depreciation Schedule.  No Credit Party shall change or amend the schedules or methodology used to calculate depreciation on its assets (except as required by applicable law or by a change in GAAP).

3.22.        OFAC.  No Credit Party (i) will become a person whose property or interests in property are blocked or subject to blocking pursuant to Section 1 of Executive Order 13224 of September 23, 200l Blocking Property and Prohibiting Transactions With Persons Who Commit, Threaten to Commit, or Support Terrorism (66 Fed. Reg. 49079 (2001)) or the Global Terrorism Sanctions Regulations, 31 C.F.R. Part 594, (ii) will engage in any dealings or transactions prohibited by Section 2 of such executive order, or be otherwise associated with any such person in any manner violative of Section 2 or the Global Terrorism Sanctions Regulations, 31 C.F.R. Part 594, or (iii) will otherwise become a person on the list of Specially Designated Nationals and Blocked Persons or subject to the limitations or prohibitions under any other OFAC regulation or executive order.

SECTION 4.

FINANCIAL COVENANTS/REPORTING

Credit Parties covenant and agree that from and after the date hereof until the Termination Date, Credit Parties shall perform and comply with, and shall cause each of the other Credit Parties to perform and comply with, all covenants in this Section 4 applicable to such Person.

4.1.          Capital Expenditure Limits.  Holdings and its Subsidiaries on a consolidated basis shall not make Capital Expenditures during any of the following periods that exceed in the aggregate the amount set forth opposite such period (the “Capex Limit”): 

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; provided, however, that commencing with the Fiscal Year ending June 30, 2007, the Capex Limit referenced above will be increased in any period by the positive amount equal to 100% of the Capex Limit for the immediately prior period less the amount of Capital Expenditures expended in such immediately prior period (the “Carry Over Amount”), and for purposes of measuring compliance herewith, the Carry Over Amount shall be deemed to be the last amount spent on Capital Expenditures in that succeeding period.

4.2.          Lease Limits.  Holdings will not and will not permit any of its Subsidiaries directly or indirectly to become or remain liable in any way, whether directly or by assignment or as a guarantor or other surety, for the obligations of the lessee under any operating lease, synthetic lease or similar off-balance sheet financing with respect to equipment, if the aggregate amount of all rents (or substantially equivalent payments) paid by Holdings and its Subsidiaries under all such leases would exceed $1,000,000 in any Fiscal Year of Holdings.

4.3.          Omitted.

4.4.          Omitted.

4.5.          Minimum Interest Coverage Ratio.  Holdings and its Subsidiaries on a consolidated basis shall have at the end of each Fiscal Quarter set forth below, an Interest Coverage Ratio for the 12-month period then ended of not less than the following:

4.6.          Maximum Leverage Ratio.  Holdings and its Subsidiaries on a consolidated basis shall have at the end of each Fiscal Quarter set forth below, a Leverage Ratio as of the last day of such Fiscal Quarter and for the 12-month period then ended, of not more than the following:

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4.7.          Omitted.

4.8.          Omitted.

4.9.          Financial Statements and Other Reports.  Holdings will maintain, and cause each of its Subsidiaries to maintain, a system of accounting established and administered in accordance with sound business practices to permit preparation of Financial Statements in conformity with GAAP (it being understood that monthly Financial Statements are not required to have footnote disclosures).  Borrower Representative will deliver each of the Financial Statements and other reports described below to Agent (and each Lender in the case of the Financial Statements and other reports described in Sections (4.9)(a), (b), (c), (e), (g), (h), (i), and (l).

(a)           Monthly Financials.  As soon as available and in any event within thirty (30) days after the end of each month (including the last month of Borrowers’ Fiscal Year), Borrower Representative will deliver (1) the consolidated and consolidating balance sheets of Holdings and its Subsidiaries, as at the end of such month, and the related consolidated and consolidating statements of income, stockholders’ equity and cash flow for such month and for the period from the beginning of the then current Fiscal Year of Holdings to the end of such month, (2) 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 Section 4.9(g) and (3) a schedule of the outstanding Indebtedness for borrowed money of Holdings and its Subsidiaries describing in reasonable detail each such debt issue or loan outstanding and the principal amount and amount of accrued and unpaid interest with respect to each such debt issue or loan.

(b)           Quarterly Financials.  As soon as available and in any event within forty-five (45) days after the end of each Fiscal Quarter of Borrowers, Borrower Representative will deliver (1) the consolidated and consolidating balance sheets of Holdings and its Subsidiaries, as at the end of such quarter, and the related consolidated and consolidating statements of income, stockholders’ equity and cash flow for such Fiscal Quarter and for the period from the beginning of the then current Fiscal Year of Holdings to the end of such Fiscal Quarter, (2) 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 Section 4.9(g) and (3) a schedule of the outstanding Indebtedness for borrowed money of Holdings and its Subsidiaries describing in reasonable detail each such debt issue or loan outstanding and the principal amount and amount of accrued and unpaid interest with respect to each such debt issue or loan.

(c)           Year-End Financials.  As soon as available and in any event within ninety (90) days after the end of each Fiscal Year of Borrowers, Borrower Representative will deliver (1) the consolidated and consolidating balance sheets of Holdings and its Subsidiaries, as at the end of such year, and the related consolidated and consolidating statements of income, stockholders’ equity and cash flow for such

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Fiscal Year, (2) a schedule of the outstanding Indebtedness for borrowed money of Holdings and its Subsidiaries describing in reasonable detail each such debt issue or loan outstanding and the principal amount and amount of accrued and unpaid interest with respect to each such debt issue or loan and (3) a report with respect to the consolidated Financial Statements from a firm of Certified Public Accountants selected by Borrowers and reasonably acceptable to Agent, which report shall be prepared in accordance with Statement of Auditing Standards No. 58 (the “Statement”) “Reports on Audited Financial Statements” and such report shall be “Unqualified” (as such term is defined in such Statement).

(d)           Accountants’ Reports.  Promptly upon receipt thereof, Borrower Representative will deliver copies of all significant reports submitted by Borrowers’ firm of Certified Public Accountants in connection with each annual, interim or special audit or review of any type of the Financial Statements or related internal control systems of Holdings or its Subsidiaries made by such accountants, including any comment letter submitted by such accountants to management in connection with their services.

(e)           Additional Deliveries.

(i)            To Agent, upon its request, and in any event no less frequently than noon New York time fifteen (15) Business Days after the end of each Fiscal Month (together with a copy of any of the following reports requested by any Lender in writing after the Amendment Effective Date), each of the following reports, each of which shall be prepared by Borrowers as of the last day of the immediately preceding Fiscal Month or the date 2 days prior to the date of any such request:

(A)          a Borrowing Base Certificate with respect to each Borrower, accompanied by such supporting detail and documentation as shall be requested by Agent in its reasonable discretion (in substantially the same form as Exhibits 4.9(e)(i), 4.9(e)(ii), 4.9(e)(iii) and Exhibits 4.9(e)(iv) (each, a “Borrowing Base Certificate”);

(B)           with respect to each Borrower, a summary of Equipment and Parts and Supplies by location and type, in each case accompanied by such supporting detail and documentation as shall be requested by Agent in its reasonable discretion; and

(C)           with respect to each Borrower, a monthly trial balance showing Accounts and Short-Term Rentals outstanding aged from invoice date as follows:  1 to 30 days, 31 to 60 days, 61 to 90 days and 91 days or more, accompanied by such supporting detail and documentation as shall be requested by Agent in its reasonable discretion.

(ii)           Upon the request of Agent, on a weekly basis or at such more frequent intervals as Agent may request from time to time (together with a copy of all or any part of such delivery requested by any Lender in writing after the Amendment Effective Date), collateral reports with respect to each Borrower, including all additions and reductions (cash and non-cash) with respect to Accounts and Short-Term Rentals of each Borrower, in each case accompanied by such supporting detail and documentation as shall be requested by Agent in its reasonable discretion each of which shall be prepared by the applicable Borrower as of the last day of the immediately preceding week or the date 2 days prior to the date of any request;]

(iii)          To Agent, at the time of delivery of each of the monthly Financial Statements delivered pursuant to this Section 4.9:

(A)          a reconciliation of the accounts receivable aging to each Borrowers’ most recent Borrowing Base Certificate, general ledger and monthly Financial Statements delivered

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pursuant to this Section 4.9, in each case accompanied by such supporting detail and documentation as shall be requested by Agent in its reasonable discretion;

(B)           a reconciliation of the summary of Equipment and Parts and Supplies delivered in accordance with Section 4.9(e)(i)(B) to each Borrower’s most recent Borrowing Base Certificate, general ledger and monthly Financial Statements delivered pursuant to this Section 4.9, in each case accompanied by such supporting detail and documentation as shall be requested by Agent in its reasonable discretion;

(C)           an aging of accounts payable and a reconciliation of that accounts payable aging to each Borrower’s general ledger and monthly Financial Statements delivered pursuant to this Section 4.9, in each case accompanied by such supporting detail and documentation as shall be requested by Agent in its reasonable discretion;

(D)          a reconciliation of the outstanding Loans as set forth in the monthly Loan Account statement provided by Agent to each Borrower’s general ledger and monthly Financial Statements delivered pursuant to this Section 4.9, in each case accompanied by such supporting detail and documentation as shall be requested by Agent in its reasonable discretion;

(iv)          To Agent, at the time of delivery of each of the annual Financial Statements delivered pursuant to this Section 4.9, (i) a listing of government contracts of each Borrower subject to the Federal Assignment of Claims Act of 1940; and (ii) a list of any applications for the registration of any Patent, Trademark or Copyright filed by any Credit Party with the United States Patent and Trademark Office, the United States Copyright Office or any similar office or agency in the prior Fiscal Quarter;

(f)            Appraisals; Inspections.

(i)            From time to time, if Agent or any Lender determines that obtaining appraisals is necessary in order for Agent or such Lender to comply with applicable laws or regulations, Agent will, at Borrowers’ expense, obtain appraisal reports in form and substance and from appraisers satisfactory to Agent stating the then current fair market values of all or any portion of the Real Estate owned by Credit Parties.  In addition to the foregoing, at Borrower’s expense, at any time while and so long as an Event of Default shall have occurred and be continuing and in the absence of an Event of Default not more than three during the calendar year, Agent may obtain appraisal reports in form and substance and from appraisers satisfactory to Agent stating the then current market values of all or any portion of the Real Estate and personal property owned by any of the Credit Parties.  Agent intends to conduct three appraisals of parts and supplies and equipment/inventory per Fiscal Year unless an Event of Default shall have occurred and be continuing, in which case such audits shall be as frequently as Agent requests at Borrower’s expense.

(ii)           Borrowers, at their own expense, shall deliver to Agent the results of each physical verification, if any, that Borrowers or any of their Subsidiaries may in their discretion have made, or caused any other Person to have made on their behalf, of all or any portion of their Parts and Supplies and Equipment (and, if a Default or an Event of Default has occurred and is continuing, Borrowers shall, upon the request of Agent, conduct, and deliver the results of, such physical verifications as Agent may require).

(iii)          Notwithstanding the foregoing, so long as no Event of Default has occurred and is continuing Agent and any Lender shall only obtain a Real Estate appraisal report pursuant

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to this Section 4.9(f) for that portion of the Real Estate that Agent, such Lender and Borrowers have agreed will be included in the Aggregate Borrowing Base

(g)           Projections.  As soon as available and in any event no later than the 60th day following the first day of each of Holdings’ Fiscal Years, Borrower Representative will deliver Projections of Holdings and its Subsidiaries for the forthcoming three (3) fiscal years, year by year, and for the forthcoming fiscal year, month by month.

(h)           SEC Filings and Press Releases.  Promptly upon their becoming available, Borrower Representative will deliver copies of (1) all Financial Statements, reports, notices and proxy statements sent or made available by Holdings or any of its Subsidiaries to their Stockholders, (2) all regular and periodic reports and all registration statements and prospectuses, if any, filed by Holdings or any of its Subsidiaries with any securities exchange or with the Securities and Exchange Commission, any Governmental Authority or any private regulatory authority, and (3) all press releases and other statements made available by Holdings or any of its Subsidiaries to the public concerning developments in the business of any such Person.

(i)            Events of Default, Etc.  Promptly upon any officer of any Credit Party obtaining knowledge of any of the following events or conditions, Borrower Representative shall deliver copies of all notices given or received by such Credit Party or any of their Subsidiaries with respect to any such event or condition and a certificate of Borrower Representative’s chief executive officer specifying the nature and period of existence of such event or condition and what action such Credit Party or Subsidiary thereof has taken, is taking and proposes to take with respect thereto:  (1) any condition or event that constitutes, or which could reasonably be expected to result in the occurrence of, an Event of Default or Default; (2) any notice that any Person has given to any Credit Party or any of their Subsidiaries or any other action taken with respect to a claimed default or event or condition of the type referred to in Section 6.1(b); (3) any event or condition that could reasonably be expected to result in any Material Adverse Effect; or (4) any default or event of default with respect to any material Indebtedness of any Credit Party or any of its Subsidiaries.

(j)            Litigation.  Promptly upon any officer of any Credit Party obtaining knowledge of (1) the institution of any action, charge, claim, demand, suit, proceeding, petition, governmental investigation, tax audit or arbitration now pending or, to the best knowledge of such Credit Party after due inquiry, threatened against or affecting any Credit Party or any of its Subsidiaries or any property of any Credit Party or any of its Subsidiaries (“Litigation”) not previously disclosed by Borrower Representative to Agent or (2) any material development in any action, suit, proceeding, governmental investigation or arbitration at any time pending against or affecting any Credit Party or any property of any Credit Party which, in each case, could reasonably be expected to have a Material Adverse Effect, Borrower Representative will promptly give notice thereof to Agent and provide such other information as may be reasonably available to them to enable Agent and its counsel to evaluate such matter.

(k)           Notice of Corporate and other Changes.  Borrower Representative shall provide prompt written notice of (1) all states in which a Credit Party becomes qualified after the Amendment Effective Date to transact business, (2) any change after the Amendment Effective in the authorized and issued Stock of any Credit Party or any Subsidiary of any Credit Party or any amendment to their articles or certificate of incorporation, by-laws, partnership agreement or other organizational documents, (3) any Subsidiary created or acquired by any Credit Party or any of its Subsidiaries after the Amendment Effective Date, such notice, in each case, to identify the applicable jurisdictions, capital structures or Subsidiaries, as applicable, and (4) any other event that occurs after the Amendment Effective Date which would cause any of the representations and warranties in Section 5 of this Agreement or in any other Loan Document to be untrue or misleading in any material respect.  The foregoing notice requirement shall not

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be construed to constitute consent by any of the Lenders to any transaction referred to above which is not otherwise permitted by the terms of this Agreement.

(l)            Compliance and Pricing Certificate.  Together with each delivery of Financial Statements of Holdings and its Subsidiaries pursuant to Section 4.9(b) and Section 4.9(c) Borrowers will deliver a fully and properly completed Compliance and Pricing Certificate (in substantially the same form as Exhibit 4.9(l) (the “Compliance and Pricing Certificate”) signed by each Borrower’s chief executive officer or chief financial officer.

(m)          Customer Concentration.  Borrower Representative shall provide prompt written notice if the Accounts of any customer exceed in the aggregate an amount equal to fifteen percent (15%) of the aggregate of all Accounts of Borrowers or any of their Subsidiaries at any time.

(n)           Other Information.  With reasonable promptness, Borrower Representative will deliver such other information and data with respect to any Credit Party or any Subsidiary of any Credit Party as from time to time may be reasonably requested by Agent.

(o)           Taxes.  Borrower Representative shall provide prompt written notice of (i) the execution or filing with the IRS or any other Governmental Authority of any agreement or other document extending, or having the effect of extending, the period for assessment or collection of any Charges by the Credit Parties which could reasonably be expected to have a Material Adverse Effect and (ii) any agreement by the Credit Parties or request directed to the Credit Parties to make any adjustment under IRC Section 481(a), by reason of a change in accounting method or otherwise, which could reasonably be expected to have a Material Adverse Effect.

4.10.        Accounting Terms; Utilization of GAAP for Purposes of Calculations under Agreement.  For purposes of this Agreement, all accounting terms not otherwise defined herein shall have the meanings assigned to such terms in conformity with GAAP.  Financial statements and other information furnished to Agent pursuant to Section 4.9 or any other section (unless specifically indicated otherwise) shall be prepared in accordance with GAAP as in effect at the time of such preparation; provided that no Accounting Change shall affect financial covenants, standards or terms in this Agreement; provided further that Holdings shall prepare footnotes to the Financial Statements required to be delivered hereunder that show the differences between the Financial Statements delivered (which reflect such Accounting Changes) and the basis for calculating financial covenant compliance (without reflecting such Accounting Changes).  All such adjustments described in clause (c) of the definition of the term Accounting Changes resulting from expenditures made subsequent to the Closing Date (including capitalization of costs and expenses or payment of pre-Closing Date liabilities) shall be treated as expenses in the period the expenditures are made.

SECTION 5.

REPRESENTATIONS AND WARRANTIES

To induce Agent and Lenders to enter into the Loan Documents, to make Loans and to issue or cause to be issued Letters of Credit, Borrowers and the other Credit Parties executing this Agreement, jointly and severally, represent, warrant and covenant to Agent and each Lender that the following statements are and, after giving effect to the Related Transactions, will remain true, correct and complete until the Termination Date with respect to all Credit Parties:

5.1.          Disclosure.  No representation or warranty of any Credit Party contained in this Agreement, the Financial Statements referred to in Section 5.5, the other Related Transactions Documents

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or any other document, certificate or written statement furnished to Agent or any Lender by or on behalf of any such Person for use in connection with the Loan Documents or the Related Transactions Documents contains as of the date made or deemed remade or given any untrue statement of a material fact or omitted, omits or will omit to state a material fact necessary in order to make the statements contained herein or therein not misleading in light of the circumstances in which the same were made.

5.2.          No Material Adverse Effect.  Since June 30, 2005 and through the Amendment Effective Date there have been no events or changes in facts or circumstances affecting any Credit Party or any of its Subsidiaries which individually or in the aggregate have had or could reasonably be expected to have a Material Adverse Effect and that have not been disclosed herein or in the attached Disclosure Schedules.

5.3.          No Conflict.  The consummation of the Related Transactions does not and will not violate or conflict with any laws, rules, regulations or orders of any Governmental Authority or violate, conflict with, result in a breach of, or constitute a default (with due notice or lapse of time or both) under any Contractual Obligation or organizational documents of any Credit Party or any of its Subsidiaries except if such violations, conflicts, breaches or defaults could not reasonably be expected to have, either individually or in the aggregate, a Material Adverse Effect.  None of the Credit Parties is an “investment company” within the meaning of the Investment Company Act of 1940, as amended, or a “holding company” or a “subsidiary company” of a “holding company” within the meaning of the Public Utility Holding Company Act of 1935, as amended.

5.4.          Organization, Powers, Capitalization and Good Standing.

(a)           Organization and Powers.  Each of the Credit Parties and each of their Subsidiaries is duly organized, validly existing and in good standing under the laws of its jurisdiction of organization and qualified to do business in all states where such qualification is required except where failure to be so qualified could not reasonably be expected to have a Material Adverse Effect.  The jurisdiction of organization and all jurisdictions as of the Amendment Effective Date in which each Credit Party is qualified to do business are set forth on Schedule 5.4(a).  Each of the Credit Parties and each of their Subsidiaries has all requisite organizational power and authority to own and operate its properties, to carry on its business as now conducted and proposed to be conducted, to enter into each Related Transactions Document to which it is a party and to incur the Obligations, grant liens and security interests in the Collateral and carry out the Related Transactions.

(b)           Capitalization.  As of the Amendment Effective Date:  (i) the authorized Stock of each of the Credit Parties and each of their Subsidiaries is as set forth on Schedule 5.4(b); (ii) all issued and outstanding Stock of each of the Credit Parties and each of their Subsidiaries is duly authorized and validly issued, fully paid, nonassessable, free and clear of all Liens other than those in favor of Agent for the benefit of Agent and Lenders and those in favor of Second Lien Agent for the benefit of Second Lien Agent and Second Lien Lenders, and such Stock was issued in compliance with all applicable state, federal and foreign laws concerning the issuance of securities; (iii) the identity of the holders of the Stock of each of the Credit Parties and each of their Subsidiaries and the percentage of their fully-diluted ownership of the Stock of each of the Credit Parties and each of their Subsidiaries is set forth on Schedule 5.4(b); and (iv) no Stock of any Credit Party or any of their Subsidiaries, other than those described above, are issued and outstanding.  Except as provided in Schedule 5.4(b), as of the Amendment Effective Date, there are no preemptive or other outstanding rights, options, warrants, conversion rights or similar agreements or understandings for the purchase or acquisition from any Credit Party or any of their Subsidiaries of any Stock of any such entity.

(c)           Binding Obligation.  This Agreement is, and the other Related Transactions Documents when executed and delivered will be, the legally valid and binding obligations of the

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applicable parties thereto, each enforceable against each of such parties, as applicable, in accordance with their respective terms.

5.5.          Financial Statements and Projections.  All Financial Statements concerning Holdings and its Subsidiaries which have been or will hereafter be furnished to Agent pursuant to this Agreement, including those listed below, have been or will be prepared in accordance with GAAP consistently applied (except as disclosed therein) and do or will present fairly the financial condition of the entities covered thereby as at the dates thereof and the results of their operations for the periods then ended, subject to, in the case of unaudited Financial Statements, the absence of footnotes and normal year-end adjustments.

(a)           The consolidated balance sheets at June 30, 2005 and the related statement of income of Holdings and its Subsidiaries, for the Fiscal Year then ended, audited by KPMG LLP.

(b)           The consolidated balance sheet at September 30, 2005 and the related statement of income of Holdings and its Subsidiaries for the three (3) months then ended.

The Projections delivered on or prior to the Amendment Effective Date and in connection with this amendment and restatement and the updated Projections delivered pursuant to Section 4.9(i) represent and will represent as of the date thereof the good faith estimate of Borrowers and their senior management concerning the most probable course of their business.

5.6.          Intellectual Property.  Each of the Credit Parties and its Subsidiaries owns, is licensed to use or otherwise has the right to use, all Intellectual Property used in or necessary for the conduct of its business as currently conducted that is material to the condition (financial or other), business or operations of such Credit Party and its Subsidiaries.  All issued Patents, registered Trademarks, registered Copyrights and pending applications for any of the foregoing owned by a Credit Party on the Amendment Effective Date are identified on Schedule 5.6 and fully protected and/or duly and properly registered, filed or issued in the appropriate office and jurisdictions for such registrations, filings or issuances.  Except as disclosed in Schedule 5.6, to the Credit Parties’ knowledge the use of such Intellectual Property by the Credit Parties and their Subsidiaries and the conduct of their businesses does not and has not been alleged by any Person to infringe on the rights of any Person.

5.7.          Investigations, Audits, Etc.  As of the Amendment Effective Date, except as set forth on Schedule 5.7, no Credit Party or any of its Subsidiaries is the subject of any review or audit by the IRS or any governmental investigation concerning the violation or possible violation of any law.

5.8.          Employee Matters.  Except as set forth on Schedule 5.8, (a) as of the Amendment Effective Date, no Credit Party or Subsidiary of a Credit Party nor any of their respective employees is subject to any collective bargaining agreement, (b) as of the Amendment Effective Date, no petition for certification or union election is pending with respect to the employees of any Credit Party or any of their Subsidiaries and no union or collective bargaining unit has sought such certification or recognition with respect to the employees of any Credit Party or any of their Subsidiaries, (c) there are no strikes, slowdowns, work stoppages or controversies pending or, to the best knowledge of any Credit Party after due inquiry, threatened between any Credit Party or any of their Subsidiaries and its respective employees, other than employee grievances arising in the ordinary course of business which could not reasonably be expected to have, either individually or in the aggregate, a Material Adverse Effect and (d) hours worked by and payment made to employees of each Credit Party and each of their Subsidiaries comply with the Fair Labor Standards Act and each other federal, state, local or foreign law applicable to such matters except where failure to comply will not have a Material Adverse Effect.  Except as set forth

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on Schedule 5.8, as of the Amendment Effective Date, neither Borrower nor any of its Subsidiaries is party to an employment contract.

5.9.          Solvency.  Each of the Credit Parties and its Subsidiaries is Solvent.

5.10.        Litigation; Adverse Facts.  Except as set forth on Schedule 5.10, there are no judgments outstanding against any Credit Party or any of its Subsidiaries or affecting any property of any Credit Party or any of its Subsidiaries, nor is there any Litigation pending, or to the best knowledge of any Credit Party threatened, against any Credit Party or any of its Subsidiaries which could reasonably be expected to result in any Material Adverse Effect.

5.11.        Use of Proceeds; Margin Regulations.

(a)           No part of the proceeds of any Loan will be used for “buying” or “carrying” “margin stock” within the respective meanings of such terms under Regulation U of the Board of Governors of the Federal Reserve System as now and from time to time hereafter in effect or for any other purpose that violates the provisions of the regulations of the Board of Governors of the Federal Reserve System.  If requested by Agent, each Credit Party will furnish to Agent and each Lender a statement to the foregoing effect in conformity with the requirements of FR Form G-3 or FR Form U-1, as applicable, referred to in Regulation U.

(b)           Borrowers shall utilize the proceeds of the Loans solely for the discharge and redemption of the Senior Unsecured Notes, prepayment of premiums payable in connection therewith, payment of accrued interest on the Senior Unsecured Notes, the redemption of the issued and outstanding shares of Senior Preferred Stock, payment of transaction expenses relating to the foregoing and for the financing of Borrowers’ ordinary working capital and general corporate needs.  Schedule 5.11 contains a description of Borrowers’ sources and uses of funds as of the Amendment Effective Date, including Loans and Letter of Credit Obligations to be made or incurred on that date, and a funds flow memorandum detailing how funds from each source are to be transferred for particular uses.

5.12.        Ownership of Property; Liens.  As of the Amendment Effective Date, the real estate (together with any real estate acquired by any Credit Party after the Amendment Effective Date, “Real Estate”) listed in Schedule 5.12, as such Schedule may be updated from time to time upon thirty (30) days’ prior written notice to Agent, constitutes all of the real property owned, leased, subleased, or used by any Credit Party or any of its Subsidiaries.  Each of the Credit Parties and each of its Subsidiaries owns, subject to Permitted Encumbrances, good and marketable fee simple title to all of its owned Real Estate, and valid and marketable leasehold interests in all of its leased Real Estate, all as described on Schedule 5.12, and copies of all such leases or a summary of terms thereof reasonably satisfactory to Agent have been delivered to Agent.  Schedule 5.12 further describes any Real Estate with respect to which any Credit Party or any of its Subsidiaries is a lessor, sublessor or assignor as of the Amendment Effective Date.  As of the Amendment Effective Date, each of the Credit Parties and each of its Subsidiaries also has good and marketable title to, or valid leasehold interests in, all of its personal property and assets, including, without limitation, those titled vehicles described in Schedule 5.12 (the “Titled Vehicles”).  As of the Amendment Effective Date, none of the properties and assets of any Credit Party or any of its Subsidiaries are subject to any Liens other than Permitted Encumbrances, and there are no facts, circumstances or conditions known to any Borrower that may result in any Liens (including Liens arising under Environmental Laws) other than Permitted Encumbrances against the properties or assets of any Credit Party or any of its Subsidiaries.  Each of the Credit Parties and each of its Subsidiaries has received all deeds, certificates of title, assignments, waivers, consents, nondisturbance and attornment or similar agreements, bills of sale and other documents, and has duly effected all recordings, filings and other actions necessary to establish, protect and perfect such Credit Party’s or

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Subsidiary’s right, title and interest in and to all such Real Estate and other properties and assets, including, without limitation, the Titled Vehicles.  Schedule 5.12 also describes any purchase options, rights of first refusal or other similar contractual rights pertaining to any Real Estate as of the Amendment Effective Date.  As of the Amendment Effective Date, no portion of any Credit Party’s or any of its Subsidiaries’ Real Estate has suffered any material damage by fire or other casualty loss that has not heretofore been repaired and restored in all material respects to its original condition or otherwise remedied.  As of the Amendment Effective Date, all material permits required to have been issued or appropriate to enable the Real Estate to be lawfully occupied and used for all of the purposes for which it is currently occupied and used have been lawfully issued and are in full force and effect.  The Liens granted to Agent, on behalf of itself and the Lenders, pursuant to the Collateral Documents will at all times, be fully perfected first priority Liens in and to the Collateral described therein, subject, as to priority, only to Permitted Encumbrances.

5.13.        Environmental Matters.

(a)           Except as set forth in Schedule 5.13, as of the Amendment Effective Date: (i) the Real Estate is free of contamination from any Hazardous Material except for such contamination that could not reasonably be expected to adversely impact the value or marketability of such Real Estate and that could not reasonably be expected to result in Environmental Liabilities of the Credit Parties or their Subsidiaries in excess of $100,000 in the aggregate; (ii) no Credit Party and no Subsidiary of a Credit Party has caused or suffered to occur any Release of Hazardous Materials on, at, in, under, above, to, from or about any of their Real Estate except for such Releases that could not reasonably be expected to result in Environmental Liabilities of the Credit Parties or their Subsidiaries in excess of $100,000 in the aggregate; (iii) the Credit Parties and their Subsidiaries are and have been in compliance with all Environmental Laws, except for such noncompliance that could not reasonably be expected to result in Environmental Liabilities of the Credit Parties or their Subsidiaries in excess of $100,000 in the aggregate; (iv) the Credit Parties and their Subsidiaries have obtained, and are in compliance with, all Environmental Permits required by Environmental Laws for the operations of their respective businesses as presently conducted or as proposed to be conducted, except where the failure to so obtain or comply with such Environmental Permits could not reasonably be expected to result in Environmental Liabilities of the Credit Parties or their Subsidiaries in excess of $100,000 in the aggregate, and all such Environmental Permits are valid, uncontested and in good standing; (v) no Credit Party and no Subsidiary of a Credit Party is involved in operations or knows of any facts, circumstances or conditions, including any Releases of Hazardous Materials, that are likely to result in any Environmental Liabilities of such Credit Party or Subsidiary that could reasonably be expected to be in excess of $100,000 in the aggregate, and no Credit Party or Subsidiary of a Credit Party has permitted any current or former tenant or occupant of the Real Estate to engage in any such operations; (vi) there is no pending Litigation arising under or related to any Environmental Laws, Environmental Permits or Hazardous Material that seeks damages, penalties, fines, costs or expenses in excess of $50,000 in the aggregate or injunctive relief against, or that alleges criminal misconduct by any Credit Party or any Subsidiary of a Credit Party; (vii) no notice has been received by any Credit Party or any Subsidiary of a Credit Party identifying any of them as a “potentially responsible party” or requesting information under CERCLA or analogous state statutes, and to the knowledge of the Credit Parties, there are no facts, circumstances or conditions that may result in any of the Credit Parties or their Subsidiaries being identified as a “potentially responsible party” under CERCLA or analogous state statutes; and (viii) the Credit Parties have provided to Agent copies of all existing environmental reports prepared by or on behalf of any Credit Party or in the possession or control of any Credit Party, reviews and audits and all written information pertaining to actual or potential Environmental Liabilities, in each case relating to any of the Credit Parties or their Subsidiaries.

(b)           Each Credit Party hereby acknowledges and agrees that Agent (i) is not now in control of any of the Real Estate or environmental affairs of such Credit Party or its Subsidiaries, (ii)  to

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the best of such Credit Party’s knowledge, before the possession or control by such Credit Party or its Subsidiaries of such Real Estate or environmental affairs, Agent was not in control of any such Real Estate of environmental affairs and (iii) does not have the capacity through the provisions of the Loan Documents or otherwise to control any Credit Party’s or its Subsidiaries’ conduct with respect to the ownership, operation or management of any of their Real Estate or compliance with Environmental Laws or Environmental Permits.

5.14.        ERISA.

(a)           Schedule 5.14 lists all Plans and separately identifies all Pension Plans, including Title IV Plans, Multiemployer Plans, ESOPs and Welfare Plans, including all Retiree Welfare Plans.  Copies of all such listed Plans, together with a copy of the latest form IRS/DOL 5500-series for each such Plan in effect as of the Amendment Effective Date have been delivered to Agent. Except with respect to Multiemployer Plans, each Qualified Plan has been determined by the IRS to qualify under Section 401 of the IRC, the trusts created thereunder have been determined to be exempt from tax under the provisions of Section 501 of the IRC, and nothing has occurred that could reasonably be expected to cause the loss of such qualification or tax-exempt status.  Each Plan other than a Multiemployer Plan, is, and to the knowledge of the Credit Parties each Multiemployer Plan is, in compliance in all material respects, with the applicable provisions of ERISA and the IRC, including the timely filing of all reports required under the IRC or ERISA, including the statement required by 29 CFR Section 2520.104-23.  Neither any Credit Party nor ERISA Affiliate has failed in other than a de minimis respect, to make any contribution or pay any amount due as required by either Section 412 of the IRC or Section 302 of ERISA or the terms of any such Plan.  Neither any Credit Party nor ERISA Affiliate has engaged in a “prohibited transaction,” as defined in Section 406 of ERISA and Section 4975 of the IRC, in connection with any Plan, that would subject any Credit Party to a material tax on prohibited transactions imposed by Section 502(i) of ERISA or Section 4975 of the IRC.

(b)           Except as set forth in Schedule 5.14: (i) no Title IV Plan has any Unfunded Pension Liability; (ii) no ERISA Event or event described in Section 4062(e) of ERISA with respect to any Title IV Plan has occurred or is reasonably expected to occur; (iii) there are no pending, or to the knowledge of any Borrower, threatened claims (other than claims for benefits in the normal course), sanctions, actions or lawsuits, asserted or instituted against any Plan (other than a Multiemployer Plan) or any Person as fiduciary or sponsor of any Plan; (iv) no Credit Party or ERISA Affiliate has incurred or reasonably expects to incur any liability as a result of a complete or partial withdrawal from a Multiemployer Plan; (v) within the last five years no Title IV Plan of any Credit Party or ERISA Affiliate has been terminated, whether or not in a “standard termination” as that term is used in Section 404(b)(1) of ERISA, nor has any Title IV Plan of any Credit Party or ERISA Affiliate (determined at any time within the past five years) with Unfunded Pension Liabilities been transferred outside of the “controlled group” (within the meaning of Section 4001(a)(14) of ERISA) of any Credit Party or ERISA Affiliate; (vi) except in the case of any ESOP, Stock of all Credit Parties and their ERISA Affiliates makes up, in the aggregate, no more than 10% of fair market value of the assets of any Plan measured on the basis of fair market value as of the latest valuation date of any Plan; and (vii) no liability under any Title IV Plan has been satisfied with the purchase of a contract from an insurance company that is not rated AAA by the S&P or an equivalent rating by another nationally recognized rating agency.

5.15.        Brokers.  No broker or finder acting on behalf of any Credit Party or Affiliate thereof brought about the obtaining, making or closing of the Loans or the Related Transactions, and no Credit Party or Affiliate thereof has any obligation to any Person in respect of any finder’s or brokerage fees in connection therewith other than under the Management Services Agreements.

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5.16.        Deposit and Disbursement Accounts.  Schedule 5.16 lists all banks and other financial institutions at which any Credit Party maintains deposit, securities or other accounts as of the Amendment Effective Date, including any Disbursement Accounts, and such Schedule correctly identifies the name, address and telephone number of each depository, the name in which the account is held, a description of the purpose of the account, and the complete account number therefor.

5.17.        Agreements and Other Documents.  As of the Amendment Effective Date, each Credit Party has provided to Agent or its counsel, on behalf of Lenders, accurate and complete copies (or summaries) of all of the following agreements or documents to which it is subject and each of which is listed in Schedule 5.17:  supply agreements and purchase agreements not terminable by such Credit Party within sixty (60) days following written notice issued by such Credit Party and involving transactions in excess of $1,000,000 per annum; leases of Equipment having a remaining term of one year or longer and requiring aggregate rental and other payments in excess of $500,000 per annum; licenses and permits held by the Credit Parties, the absence of which could reasonably be expected to have a Material Adverse Effect; instruments and documents evidencing any Indebtedness or Guaranteed Indebtedness of such Credit Party and any Lien granted by such Credit Party with respect thereto; and instruments and agreements evidencing the issuance of any equity securities, warrants, rights or options to purchase equity securities of such Credit Party.

5.18.        Insurance.  Schedule 5.18 lists all insurance policies of any nature maintained, as of the Amendment Effective Date, for current occurrences by each Credit Party, as well as a summary of the key business terms of each such policy such as deductibles, coverage limits and term of policy.

5.19.        Omitted.

5.20.        Omitted.

5.21.        Taxes.  All Tax returns required to be filed by the Credit Parties have been timely and properly filed and all Taxes that are due (other than Taxes being contested in good faith by appropriate proceedings and for which adequate reserves have been provided in accordance with GAAP) have been paid, except where the failure to file Tax returns or pay Taxes would not have a Material Adverse Effect.  No Governmental Authority has asserted any claim for Taxes, or to any Credit Party’s knowledge, has threatened to assert any claim for Taxes that would, if not paid by a Credit Party, have a Material Adverse Effect.  All Taxes required by law to be withheld or collected and remitted (including, without limitation, income tax, unemployment insurance and workmen’s compensation premiums) with respect to the Credit Parties have been withheld or collected and paid to the appropriate Governmental Authorities (or are properly being held for such payment), except for amounts the nonpayment of which would not be reasonably likely to have a Material Adverse Effect.  None of the Credit Parties has been notified that either the IRS or any other Governmental Authority has raised or intends to raise any adjustments with respect to Taxes of the Credit Parties, which adjustments would be reasonably likely to have a Material Adverse Effect.

5.22.        Anti-Terrorism.  Neither the borrowing of the Loans by Borrowers, nor any other Related Transaction, nor the use of the respective proceeds thereof, shall cause the Lenders or Agent to violate the U.S. Bank Secrecy Act, as amended, and any applicable regulations thereunder or any of the sanctions programs administered by the U.S. Department of the Treasury’s Office of Foreign Assets Control, (“OFAC”), any regulations promulgated thereunder by OFAC or under any affiliated or successor governmental or quasi-governmental office, bureau or agency and any enabling legislation or executive order relating thereto.  Without limiting the foregoing, no Credit Party (i) is a person whose property or interests in property are blocked or subject to blocking pursuant to Section 1 of Executive Order 13224 of September 23, 200l Blocking Property and Prohibiting Transactions With Persons Who Commit,

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Threaten to Commit, or Support Terrorism (66 Fed. Reg. 49079 (2001)) or the Global Terrorism Sanctions Regulations, 31 C.F.R. Part 594, (ii) engages in any dealings or transactions prohibited by Section 2 of such executive order, or be otherwise associated with any such person in any manner violative of Section 2 or the Global Terrorism Sanctions Regulations, 31 C.F.R. Part 594, or (iii) is a person on the list of Specially Designated Nationals and Blocked Persons maintained by OFAC or subject to the limitations or prohibitions under any other OFAC regulation or OFAC-related executive order.  The Credit Parties are in compliance, in all material respects, with the Uniting and Strengthening of America by Providing the Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 and 18 U.S.C. §§ 1956, 1957.  No part of the proceeds of the Loans or Letters of Credit will be used, directly or indirectly, for any payments to any governmental official or employee, political party, official of a political party, candidate for political office, or anyone else acting in an official capacity, in order to obtain, retain or direct business or obtain any improper advantage, in violation of the United States Foreign Corrupt Practices Act of 1977, as amended.

5.23.        Closing Availability and Leverage; Capital Structure.  As of the Amendment Effective Date and after giving effect to the funding of the Loans to be made and Letters of Credit to be issued on the Amendment Effective Date, (i) Funded Debt of Holdings and its Subsidiaries on a consolidated basis, after giving effect to the initial fundings including issuances of Letters of Credit under the Amended and Restated Credit Agreement and the incurrence of the Second Lien Debt and the application of proceeds thereof, does not exceed $122,000,000, (ii) Borrower shall have a minimum trailing twelve month EBITDA of not less than $26,800,000 for the most recently ended month for which financial statements are available, (iii) the ratio of Funded Debt to EBITDA shall be less than 4.75:1.00 as of the Amendment Effective Date, (iv) as of the Amendment Effective Date, after giving effect to the consummation of the Related Transactions, Borrowing Availability is not less than $15,000,000 and (v) Holdings owns 100% of the Stock of Penhall, that Sponsor owns approximately 70% and that management owns approximately 30% of the voting Stock of Holdings and that Holdings is capitalized with approximately $28,600,000 in liquidation preference of preferred stock plus accreted dividends (excluding the Senior Preferred Stock that is being redeemed) and approximately $1,000,000 (in book value) of common stock.

SECTION 6.

DEFAULT, RIGHTS AND REMEDIES

6.1.          Event of Default.  “Event of Default” shall mean the occurrence or existence of any one or more of the following:

(a)           Payment.  (1) Failure to pay any installment or other payment of principal of any Loan when due, or to repay Revolving Loans to reduce their balance to the maximum amount of Revolving Loans then permitted to be outstanding or to reimburse any L/C Issuer for any payment made by such L/C Issuer under or in respect of any Letter of Credit when due or (2) failure to pay, within three (3) days after the due date, any interest on any Loan or any other amount due under this Agreement or any of the other Loan Documents; or

(b)           Default in Other Agreements.  (1) Any Credit Party or any of its Subsidiaries fails to pay when due or within any applicable grace period any amount of principal of or any amount of interest on Indebtedness (other than the Loans) or any Contingent Obligations if such Indebtedness or Contingent Obligation is in excess of $100,000 or (2) breach or default of any Credit Party or any of its Subsidiaries, or the occurrence of any condition or event, with respect to any Indebtedness (other than the Loans) or any Contingent Obligations, if the effect of such breach, default or occurrence is to cause or to permit the holder or holders then to cause, Indebtedness and/or Contingent Obligations having an individual

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principal amount in excess of $1,000,000 or having an aggregate principal amount in excess of $1,000,000 to become or be declared due prior to their stated maturity; or

(c)           Breach of Certain Provisions; Breach of Warranty.  Failure of any Credit Party to perform or comply with any term or condition contained in that portion of Section 2.2 relating to the Credit Parties’ obligation to maintain insurance, Section 2.3, Section 3 or Section 4; or

(d)           Borrowing Base Certificate; Breach of Warranty.  Any information contained in any Borrowing Base Certificate is untrue or incorrect in any respect (other than inadvertent, immaterial errors not exceeding $1,000,000 in the aggregate in any Borrowing Base Certificate), or any representation or warranty herein or in any Loan Document or in any written statement, report, financial statement or certificate (other than a Borrowing Base Certificate) made or delivered to Agent or any Lender by any Credit Party is untrue or incorrect in any material respect (without duplication of materiality qualifiers contained therein) as of the date when made or deemed made; or

(e)           Other Defaults under Loan Documents. Any Credit Party defaults in the performance of or compliance with any term contained in this Agreement or the other Loan Documents (other than occurrences described in other provisions of this Section 6.1 for which a different grace or cure period is specified, or for which no cure period is specified and which constitute immediate Events of Default) and such default is not remedied or waived within thirty (30) days after the earlier of (1) receipt by Borrower Representative of notice from Agent or Requisite Lenders of such default or (2) actual knowledge of any Borrower or any other Credit Party of such default; or

(f)            Involuntary Bankruptcy; Appointment of Receiver, Etc.  (1) A court enters a decree or order for relief with respect to any Credit Party in an involuntary case under the Bankruptcy Code, which decree or order is not stayed or other similar relief is not granted under any applicable federal or state law; or (2) the continuance of any of the following events for forty-five (45) days unless dismissed, bonded or discharged:  (a) an involuntary case is commenced against any Credit Party, under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect; or (b) a decree or order of a court for the appointment of a receiver, liquidator, sequestrator, trustee, custodian or other officer having similar powers over any Credit Party, or over all or a substantial part of its property, is entered; or (c) a receiver, trustee or other custodian is appointed without the consent of a Credit Party, for all or a substantial part of the property of the Credit Party; or

(g)           Voluntary Bankruptcy; Appointment of Receiver, Etc.  (1) any Credit Party commences a voluntary case under the Bankruptcy Code, or consents to the entry of an order for relief in an involuntary case or to the conversion of an involuntary case to a voluntary case under any such law or consents to the appointment of or taking possession by a receiver, trustee or other custodian for all or a substantial part of its property; or (2) any Credit Party makes any assignment for the benefit of creditors; or (3) the Board of Directors of any Credit Party adopts any resolution or otherwise authorizes action to approve any of the actions referred to in this Section 6.1(g); or

(h)           Judgment and Attachments.  Any money judgment, writ or warrant of attachment, or similar process (other than those described elsewhere in this Section 6.1) involving (1) an amount in any individual case in excess of $300,000 or (2) an amount in the aggregate at any time in excess of $700,000 (in either case to the extent not adequately covered by insurance in Agent’s sole discretion as to which the insurance company has acknowledged coverage) is entered or filed against one or more of the Credit Parties or any of their respective assets and remains undischarged, unvacated, unbonded or unstayed for a period of thirty (30) days or in any event later than five (5) Business Days prior to the date of any proposed sale thereunder; or

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(i)            Dissolution.  Any order, judgment or decree is entered against any Credit Party decreeing the dissolution or split up of such Credit Party and such order remains undischarged or unstayed for a period in excess of fifteen (15) days; or

(j)            Solvency.  Any Credit Party ceases to be Solvent, fails to pay its debts as they become due or admits in writing its present or prospective inability to pay its debts as they become due; or

(k)           Invalidity of Loan Documents.  Any of the Loan Documents or Second Lien Loan Documents for any reason, other than a partial or full release in accordance with the terms thereof, ceases to be in full force and effect or is declared to be null and void, or any Credit Party denies that it has any further liability under any Loan Documents to which it is party, or gives notice to such effect; or

(l)            Damage; Casualty.  Any event occurs, whether or not insured or insurable, as a result of which revenue-producing activities cease or are substantially curtailed at any facility of any Credit Party generating more than 10% of the consolidated revenues of Holdings and its Subsidiaries for the Fiscal Year preceding such event and such cessation or curtailment continues for more than 30 days; or

(m)          Business Activities.  Holdings engages in any type of business activity other than the ownership of Stock of Borrowers, ownership of Real Estate, performance of its obligations under the Related Transaction Documents to which it is a party or any document governing or evidencing Indebtedness incurred in connection with a Permitted Refinancing of Second Lien Debt and, until the date forty-five (45) days following the Amendment Effective Date, the Senior Unsecured Notes and Senior Unsecured Notes Indenture.

(n)           Change of Control.  A Change of Control occurs; or

(o)           Subordinated and Second Lien Indebtedness.  The failure of any Credit Party or any creditor of any Borrower or any of its Subsidiaries to comply with the terms of any subordination or intercreditor agreement or any debt or lien subordination provisions of any note or other document running to the benefit of Agent or Lenders, or if any such document becomes null and void or any party denies further liability under any such document or provides notice to that effect.

6.2.         Suspension or Termination of Commitments.  Upon the occurrence of any Default or Event of Default, Agent may, and at the request of Requisite Lenders Agent shall, without notice or demand, immediately suspend or terminate all or any portion of Lenders’ obligations to make additional Loans or issue or cause to be issued Letters of Credit under the Revolving Loan Commitment; provided that, in the case of a Default, if the subject condition or event is waived by Requisite Lenders or cured within any applicable grace or cure period, the Revolving Loan Commitment shall be reinstated.

6.3.         Acceleration and Other Remedies.  Upon the occurrence of any Event of Default described in Sections 6.1(f) or 6.1(g), the Commitments shall be immediately terminated and all of the Obligations, including the Revolving Loans, shall automatically become immediately due and payable, without presentment, demand, protest, notice of intent to accelerate, notice of acceleration or other requirements of any kind, all of which are hereby expressly waived (including for purposes of Section 10) by Borrowers, and the Commitments shall thereupon terminate.  Upon the occurrence and during the continuance of any other Event of Default, Agent may, and at the request of the Requisite Lenders, Agent shall, by written notice to Borrower Representative (a) reduce the aggregate amount of the Commitments from time to time, (b) declare all or any portion of the Loans and all or any portion of the other Obligations to be, and the same shall forthwith become, immediately due and payable together with accrued interest thereon, (c) terminate all or any portion of the obligations of Agent, L/C Issuers and

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Lenders to make Revolving Credit Advances and issue Letters of Credit, (d) demand that Borrowers immediately deliver cash to Agent for the benefit of L/C Issuers (and Borrowers shall then immediately so deliver) in an amount equal to 105% of the aggregate outstanding Letter of Credit Obligations and (e) exercise any other remedies which may be available under the Loan Documents or applicable law.  Borrowers hereby grant to Agent, for the benefit of L/C Issuers and each Lender with a participation in any Letters of Credit then outstanding, a security interest in such cash collateral to secure all of the Letter of Credit Obligations.  Any such cash collateral shall be made available by Agent to L/C Issuers to reimburse L/C Issuers for payments of drafts drawn under such Letters of Credit and any Fees, Charges and expenses of L/C Issuers with respect to such Letters of Credit and the unused portion thereof, after all such Letters of Credit shall have expired or been fully drawn upon, shall be applied to repay any other Obligations.  After all such Letters of Credit shall have expired or been fully drawn upon and all Obligations shall have been satisfied and paid in full, the balance, if any, of such cash collateral shall be returned to Borrowers.  Borrowers shall from time to time execute and deliver to Agent such further documents and instruments as Agent may request with respect to such cash collateral.

6.4.         Performance by Agent.  If any Credit Party shall fail to perform any covenant, duty or agreement contained in any of the Loan Documents, Agent may perform or attempt to perform such covenant, duty or agreement on behalf of such Credit Party after the expiration of any cure or grace periods set forth herein.  In such event, such Credit Party shall, at the request of Agent, promptly pay any amount reasonably expended by Agent in such performance or attempted performance to Agent, together with interest thereon at the highest rate of interest in effect upon the occurrence of an Event of Default as specified in Section 1.2(d) from the date of such expenditure until paid.  Notwithstanding the foregoing, it is expressly agreed that Agent shall not have any liability or responsibility for the performance of any obligation of any Credit Party under this Agreement or any other Loan Document.

6.5.         Application of Proceeds.  Notwithstanding anything to the contrary contained in this Agreement, upon the occurrence and during the continuance of an Event of Default all payments shall be applied as set forth in Section 1.12(c).

SECTION 7.

CONDITIONS TO LOANS

The effectiveness of the amendment and restatement of the Existing Credit Agreement and the obligations of Lenders and L/C Issuers to make Loans and to issue or cause to be issued Letters of Credit in each case, from and after the Amendment Effective Date, are subject to satisfaction of all of the applicable conditions set forth below.

7.1.         Conditions to Initial Loans.  The effectiveness of the amendment and restatement of the Existing Credit Agreement and the obligations of Lenders and L/C Issuers to make the initial Loans and to issue or cause to be issued Letters of Credit on the Amendment Effective Date are, in addition to the conditions precedent specified in Section 7.2, subject to the delivery of all documents listed on, the taking of all actions set forth on and the satisfaction of all other conditions precedent listed in the Closing Checklist attached hereto as Annex C, all in form and substance, or in a manner, satisfactory to Agent and Lenders.

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7.2.         Conditions to All Loans.  Except as otherwise expressly provided herein, no Lender or L/C Issuer shall be obligated to fund any Advance or incur any Letter of Credit Obligation, if, as of the date thereof (the “Funding Date”):

(a)           any representation or warranty by any Credit Party contained herein or in any other Loan Document is untrue or incorrect in any material respect (without duplication of any materiality qualifier contained therein) as of such date, except to the extent that such representation or warranty expressly relates to an earlier date, and Agent or Requisite Lenders have determined not to make such Advance or incur such Letter of Credit Obligation as a result of the fact that such warranty or representation is untrue or incorrect;

(b)           any Default or Event of Default has occurred and is continuing or would result after giving effect to any Advance (or the incurrence of any Letter of Credit Obligation), and Agent or Requisite Lenders shall have determined not to make any Advance or incur any Letter of Credit Obligation as a result of that Default or Event of Default; or

(c)           after giving effect to any Advance (or the incurrence of any Letter of Credit Obligations), (i) the outstanding amount of the aggregate Revolving Loan would exceed remaining Borrowing Availability (except as provided in Section 1.1(a)(ii)) or (ii) the outstanding amount of the Revolving Loan of the applicable Borrower would exceed such Borrower’s separate Borrowing Base less the outstanding amount of the Swing Line Loan to that Borrower.

The request and acceptance by any Borrower of the proceeds of any Advance, the incurrence of any Letter of Credit Obligations or the conversion or continuation of any Loan into, or as, a LIBOR Loan shall be deemed to constitute, as of the date thereof, (i) a representation and warranty by Credit Parties that the conditions in this Section 7.2 have been satisfied and (ii) a reaffirmation by Borrowers of the cross guaranty provisions set forth in Section 10 and of the granting and continuance of Agent’s Liens, on behalf of itself and Lenders, pursuant to the Collateral Documents.

SECTION 8.

ASSIGNMENT AND PARTICIPATION

8.1.         Assignment and Participations.

(a)           Subject to the terms of this Section 8.1, any Lender may make an assignment to a Qualified Assignee of, or sale of participations in, at any time or times, the Loan Documents, Loans, Letter of Credit Obligations and any Commitment or any portion thereof or interest therein, including any Lender’s rights, title, interests, remedies, powers or duties thereunder.  Any assignment by a Lender shall:  (i) require the consent of Agent (which consent shall not be unreasonably withheld or delayed with respect to a Qualified Assignee) and the execution of an assignment agreement (an “Assignment Agreement” substantially in the form attached hereto as Exhibit 8.1 and otherwise in form and substance reasonably satisfactory to, and acknowledged by, Agent); (ii) be conditioned on such assignee Lender representing to the assigning Lender and Agent that it is purchasing the applicable Loans to be assigned to it for its own account, for investment purposes and not with a view to the distribution thereof; (iii) after giving effect to any such partial assignment, the assignee Lender shall have Commitments in an amount at least equal to $5,000,000 and the assigning Lender shall have retained Commitments in an amount at least equal to $5,000,000; and (iv) require a payment to Agent of an assignment fee of $3,500.  Notwithstanding the above, Agent may in its sole and absolute discretion permit any assignment by a Lender to a Person or Persons that are not Qualified Assignees.  In the case of an assignment by a Lender under this Section 8.1, the assignee shall have, to the extent of such assignment, the same rights, benefits

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and obligations as all other Lenders hereunder.  The assigning Lender shall be relieved of its obligations hereunder with respect to its Commitments or assigned portion thereof from and after the date of such assignment.  Borrowers hereby acknowledge and agree that any assignment shall give rise to a direct obligation of Borrowers to the assignee and that the assignee shall be considered to be a “Lender.”  In all instances, each Lender’s liability to make Loans hereunder shall be several and not joint and shall be limited to such Lender’s Pro Rata Share of the applicable Commitment.  In the event Agent or any Lender assigns or otherwise transfers all or any part of the Obligations, Agent or any such Lender shall so notify Borrowers and Borrowers shall, upon the request of Agent or such Lender, execute new Notes in exchange for the Notes, if any, being assigned.  Notwithstanding the foregoing provisions of this Section 8.1(a), (a) any Lender may at any time pledge the Obligations held by it and such Lender’s rights under this Agreement and the other Loan Documents to a Federal Reserve Bank, (b) any Lender that is an investment fund may assign the Obligations held by it and such Lender’s rights under this Agreement and the other Loan Documents to another investment fund managed by the same investment advisor or pledge such Obligations and rights to trustee for the benefit of its investors and (c) any Lender may assign the Obligations to an Affiliate of such Lender or to a Person that is a Lender prior to the date of such assignment.

(b)           Any participation by a Lender of all or any part of its Commitments shall be made with the understanding that all amounts payable by Borrowers hereunder shall be determined as if that Lender had not sold such participation, and that the holder of any such participation shall not be entitled to require such Lender to take or omit to take any action hereunder except actions directly affecting (i) any reduction in the principal amount of, or interest rate or Fees payable with respect to, any Loan in which such holder participates, (ii) any extension of the scheduled amortization of the principal amount of any Loan in which such holder participates or the final maturity date thereof, and (iii) any release of all or substantially all of the Collateral (other than in accordance with the terms of this Agreement, the Collateral Documents or the other Loan Documents).  Solely for purposes of Sections 1.10, 1.11, 8.3 and 9.1, Borrowers acknowledge and agree that a participation shall give rise to a direct obligation of Borrowers to the participant and the participant shall be considered to be a “Lender.”  Except as set forth in the preceding sentence no Borrower or any other Credit Party shall have any obligation or duty to any participant.  Neither Agent nor any Lender (other than the Lender selling a participation) shall have any duty to any participant and may continue to deal solely with the Lender selling a participation as if no such sale had occurred.

(c)           Except as expressly provided in this Section 8.1, no Lender shall, as between Borrowers and that Lender, or Agent and that Lender, be relieved of any of its obligations hereunder as a result of any sale, assignment, transfer or negotiation of, or granting of participation in, all or any part of the Loans, the Notes or other Obligations owed to such Lender.

(d)           Each Credit Party shall assist each Lender permitted to sell assignments or participations under this Section 8.1 as required to enable the assigning or selling Lender to effect any such assignment or participation, including the execution and delivery of any and all agreements, notes and other documents and instruments as shall be requested and the prompt preparation of informational materials for, and the participation of management in meetings with, potential assignees or participants, all on a timetable established by Agent in its sole discretion.  Each Credit Party executing this Agreement shall certify the correctness, completeness and accuracy of all descriptions of the Credit Parties and their respective affairs contained in any selling materials provided by it and all other information provided by it and included in such materials, except that any Projections delivered by Borrowers shall only be certified by Borrowers as having been prepared by Borrowers in compliance with the representations contained in Section 5.5.  Agent shall maintain, on behalf of Borrowers, in its offices located at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ a “register” for recording the name, address, commitment and Loans owing to each Lender.  The entries in such register shall be presumptive evidence of the amounts due and owing to

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each Lender in the absence of manifest error.  Borrowers, Agent and each Lender may treat each Person whose name is recorded in such register pursuant to the terms hereof as a Lender for all purposes of this Agreement.  The register described herein shall be available for inspection by Borrower and any Lender, at any reasonable time upon reasonable prior notice.

(e)           A Lender may furnish any information concerning Credit Parties in the possession of such Lender from time to time to assignees and participants (including prospective assignees and participants); provided that such Lender shall obtain from assignees or participants confidentiality covenants substantially equivalent to those contained in Section 9.13.

(f)            So long as no Event of Default has occurred and is continuing, no Lender shall assign or sell participations in any portion of its Loans or Commitments to a potential Lender or participant, if, as of the date of the proposed assignment or sale, the assignee Lender or participant would be eligible to demand payment in respect of capital adequacy or similar requirements under Section 1.10(a), to demand increased costs or be entitled not to fund LIBOR Loans under Section 1.10(b), or would subject Credit Parties to increased costs in accordance with Section 1.11.

8.2.         Agent.

(a)           Appointment.  Each Lender hereby designates and appoints GE Capital as its Agent under this Agreement and the other Loan Documents, and each Lender hereby irrevocably authorizes Agent to execute and deliver the Collateral Documents and to take such action or to refrain from taking such action on its behalf under the provisions of this Agreement and the other Loan Documents and to exercise such powers as are set forth herein or therein, together with such other powers as are reasonably incidental thereto.  Agent is authorized and empowered to amend, modify, or waive any provisions of this Agreement or the other Loan Documents on behalf of Lenders subject to the requirement that certain of Lenders’ consent be obtained in certain instances as provided in this Section 8.2 and Section 9.2.  The provisions of this Section 8.2 are solely for the benefit of Agent and Lenders and neither Borrowers nor any other Credit Party shall have any rights as a third party beneficiary of any of the provisions hereof.  In performing its functions and duties under this Agreement, Agent shall act solely as agent of Lenders and does not assume and shall not be deemed to have assumed any obligation toward or relationship of agency or trust with or for Borrowers or any other Credit Party.  Agent may perform any of its duties hereunder, or under the Loan Documents, by or through its agents or employees.  By signing in the spaces below, the Lenders hereby authorize and direct GE Capital, in its capacity as Agent for the Lenders, to execute and deliver the Collateral Documents.

(b)           Nature of Duties.  The duties of Agent shall be mechanical and administrative in nature.  Agent shall not have by reason of this Agreement a fiduciary relationship in respect of any Lender.  Nothing in this Agreement or any of the Loan Documents, express or implied, is intended to or shall be construed to impose upon Agent any obligations in respect of this Agreement or any of the Loan Documents except as expressly set forth herein or therein.  Each Lender shall make its own independent investigation of the financial condition and affairs of each Credit Party in connection with the extension of credit hereunder and shall make its own appraisal of the creditworthiness of each Credit Party, and Agent shall have no duty or responsibility, either initially or on a continuing basis, to provide any Lender with any credit or other information with respect thereto (other than as expressly required herein).  If Agent seeks the consent or approval of any Lenders to the taking or refraining from taking any action hereunder, then Agent shall send notice thereof to each Lender.  Agent shall promptly notify each Lender any time that the Requisite Lenders or Supermajority Revolving Lenders have instructed Agent to act or refrain from acting pursuant hereto.

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(c)           Rights, Exculpation, Etc.  Neither Agent nor any of its officers, directors, employees or agents shall be liable to any Lender for any action taken or omitted by them hereunder or under any of the Loan Documents, or in connection herewith or therewith, except that Agent shall be liable to the extent of its own gross negligence or willful misconduct as determined by a final non-appealable order by a court of competent jurisdiction.  Agent shall not be liable for any apportionment or distribution of payments made by it in good faith and if any such apportionment or distribution is subsequently determined to have been made in error the sole recourse of any Lender to whom payment was due but not made, shall be to recover from other Lenders any payment in excess of the amount to which they are determined to be entitled (and such other Lenders hereby agree to return to such Lender any such erroneous payments received by them).  In no event shall Agent be liable for punitive, special, consequential, incidental, exemplary or other similar damages.  In performing its functions and duties hereunder, Agent shall exercise the same care which it would in dealing with loans for its own account, but neither Agent nor any of its agents or representatives shall be responsible to any Lender for any recitals, statements, representations or warranties herein or for the execution, effectiveness, genuineness, validity, enforceability, collectibility, or sufficiency of this Agreement or any of the Loan Documents or the transactions contemplated thereby, or for the financial condition of any Credit Party.  Agent shall not be required to make any inquiry concerning either the performance or observance of any of the terms, provisions or conditions of this Agreement or any of the Loan Documents or the financial condition of any Credit Party, or the existence or possible existence of any Default or Event of Default.  Agent may at any time request instructions from Requisite Lenders, Supermajority Revolving Lenders or all affected Lenders with respect to any actions or approvals which by the terms of this Agreement or of any of the Loan Documents Agent is permitted or required to take or to grant.  If such instructions are promptly requested, Agent shall be absolutely entitled to refrain from taking any action or to withhold any approval and shall not be under any liability whatsoever to any Person for refraining from any action or withholding any approval under any of the Loan Documents until it shall have received such instructions from the Requisite Lenders, Supermajority Revolving Lenders or such other portion of the Lenders as shall be prescribed by this Agreement.  Without limiting the foregoing, no Lender shall have any right of action whatsoever against Agent as a result of Agent acting or refraining from acting under this Agreement or any of the other Loan Documents in accordance with the instructions of Requisite Lenders, Supermajority Revolving Lenders or all affected Lenders, as applicable; and, notwithstanding the instructions of Requisite Lenders, Supermajority Revolving Lenders or all affected Lenders, as applicable, Agent shall have no obligation to take any action if it believes, in good faith, that such action is deemed to be illegal by Agent or exposes Agent to any liability for which it has not received satisfactory indemnification in accordance with Section 8.2(e).

(d)           Reliance.  Agent shall be entitled to rely, and shall be fully protected in relying, upon any written or oral notices, statements, certificates, orders or other documents or any telephone message or other communication (including any writing, telex, fax or telegram) believed by it in good faith to be genuine and correct and to have been signed, sent or made by the proper Person, and with respect to all matters pertaining to this Agreement or any of the Loan Documents and its duties hereunder or thereunder.  Agent shall be entitled to rely upon the advice of legal counsel, independent accountants, and other experts selected by Agent in its sole discretion.

(e)           Indemnification.  Lenders will reimburse and indemnify Agent for and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses (including, without limitation, attorneys’ fees and expenses), advances or disbursements of any kind or nature whatsoever which may be imposed on, incurred by, or asserted against Agent in any way relating to or arising out of this Agreement or any of the Loan Documents or any action taken or omitted by Agent under this Agreement or any of the Loan Documents, in proportion to each Lender’s Pro Rata Share, but only to the extent that any of the foregoing is not reimbursed by Borrowers; provided, however, that no Lender shall be liable for any portion of such liabilities, obligations, losses, damages, penalties, actions,

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judgments, suits, costs, expenses, advances or disbursements to the extent resulting from Agent’s gross negligence or willful misconduct as determined by a final non-appealable order by a court of competent jurisdiction.  If any indemnity furnished to Agent for any purpose shall, in the opinion of Agent, be insufficient or become impaired, Agent may call for additional indemnity and cease, or not commence, to do the acts indemnified against even if so directed by the Requisite Lenders, Supermajority Revolving Lenders or such other portion of the Lenders as shall be prescribed by this Agreement until such additional indemnity is furnished.  The obligations of Lenders under this Section 8.2(e) shall survive the payment in full of the Obligations and the termination of this Agreement.

(f)            GE Capital Individually.  With respect to its Commitments hereunder, GE Capital shall have and may exercise the same rights and powers hereunder and is subject to the same obligations and liabilities as and to the extent set forth herein for any other Lender.  The terms “Lenders”, “Requisite Lenders”, “Supermajority Revolving Lenders” or any similar terms shall, unless the context clearly otherwise indicates, include GE Capital in its individual capacity as a Lender or one of the Requisite Lenders or Supermajority Revolving Lenders.  GE Capital, either directly or through strategic affiliations, may lend money to, acquire equity or other ownership interests in, provide advisory services to and generally engage in any kind of banking, trust or other business with any Credit Party as if it were not acting as Agent pursuant hereto and without any duty to account therefor to Lenders.  GE Capital, either directly or through strategic affiliations, may accept fees and other consideration from any Credit Party for services in connection with this Agreement or otherwise without having to account for the same to Lenders.