DATED AS OF MAY 5, 1999 AMONG JO-ANN STORES, INC. AS BORROWER THE LENDING INSTITUTIONS NAMED THEREIN AS LENDERS

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CREDIT AGREEMENT

DATED AS OF
MAY 5, 1999

AMONG

XX-XXX STORES, INC.
AS BORROWER

THE LENDING INSTITUTIONS NAMED THEREIN
AS LENDERS

THE FIRST NATIONAL BANK OF CHICAGO
AS DOCUMENTATION AGENT

COMERICA BANK
NATIONAL CITY BANK
AS CO-AGENTS

[LOGO]

KEYBANK NATIONAL ASSOCIATION
AS A LENDER, THE SWING LINE LENDER, THE ISSUING BANK AND
AS ADMINISTRATIVE AGENT

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TABLE OF CONTENTS

PAGE

SECTION 1. DEFINITIONS AND TERMS . . . . . . . . . . . . . . . . . . . . . . 1
1.1. CERTAIN DEFINED TERMS . . . . . . . . . . . . . . . . . . . . . . 1
1.2. COMPUTATION OF TIME PERIODS . . . . . . . . . . . . . . . . . . .18
1.3. ACCOUNTING TERMS. . . . . . . . . . . . . . . . . . . . . . . . .18
1.4. TERMS GENERALLY . . . . . . . . . . . . . . . . . . . . . . . . .19
1.5. CURRENCY EQUIVALENTS. . . . . . . . . . . . . . . . . . . . . . .19

SECTION 2. AMOUNT AND TERMS OF LOANS . . . . . . . . . . . . . . . . . . . .19
2.1. COMMITMENTS FOR LOANS . . . . . . . . . . . . . . . . . . . . . .19
2.2. PROCEDURES FOR BORROWING. . . . . . . . . . . . . . . . . . . . .20
2.3. REFUNDING OF, OR PARTICIPATION IN, SWING LINE LOANS . . . . . . .22
2.4. NOTES; LOAN ACCOUNTS. . . . . . . . . . . . . . . . . . . . . . .23
2.5. CONVERSIONS OF BORROWINGS UNDER THE GENERAL REVOLVING FACILITY. .24
2.6. INTEREST. . . . . . . . . . . . . . . . . . . . . . . . . . . . .25
2.7. SELECTION AND CONTINUATION OF INTEREST PERIODS. . . . . . . . . .27
2.8. INCREASED COSTS, ILLEGALITY, ETC. . . . . . . . . . . . . . . . .27
2.9. BREAKAGE COMPENSATION . . . . . . . . . . . . . . . . . . . . . .29
2.10. CHANGE OF LENDING OFFICE; REPLACEMENT OF LENDERS. . . . . . . . .30

SECTION 3. LETTERS OF CREDIT . . . . . . . . . . . . . . . . . . . . . . . .30
3.1. LETTERS OF CREDIT . . . . . . . . . . . . . . . . . . . . . . . .30
3.2. LETTER OF CREDIT REQUESTS: NOTICES OF ISSUANCE. . . . . . . . . .31
3.3. AGREEMENT TO REPAY LC DISBURSEMENTS . . . . . . . . . . . . . . .32
3.4. PARTICIPATIONS IN LETTERS OF CREDIT . . . . . . . . . . . . . . .33
3.5. INCREASED COSTS . . . . . . . . . . . . . . . . . . . . . . . . .34
3.6. GUARANTY OF SUBSIDIARY LETTER OF CREDIT OBLIGATIONS . . . . . . .35

SECTION 4. FEES AND COMMISSIONS; TERMINATION
AND REDUCTION OF COMMITMENTS. . . . . . . . . . . . . . . . . .36
4.1. FEES AND COMMISSIONS. . . . . . . . . . . . . . . . . . . . . . .36
4.2. VOLUNTARY TERMINATION/REDUCTION OF COMMITMENTS. . . . . . . . . .38
4.3. MANDATORY TERMINATION/ADJUSTMENTS OF COMMITMENTS, ETC.. . . . . .38
4.4. EXTENSION OF MATURITY DATE. . . . . . . . . . . . . . . . . . . .38

SECTION 5. PAYMENTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . .39
5.1. VOLUNTARY PREPAYMENTS . . . . . . . . . . . . . . . . . . . . . .39
5.2. MANDATORY PREPAYMENTS . . . . . . . . . . . . . . . . . . . . . .39
5.3. METHOD AND PLACE OF PAYMENT . . . . . . . . . . . . . . . . . . .41
5.4. NET PAYMENTS. . . . . . . . . . . . . . . . . . . . . . . . . . .41

SECTION 6. CONDITIONS PRECEDENT. . . . . . . . . . . . . . . . . . . . . . .43
6.1. CONDITIONS PRECEDENT AT CLOSING DATE. . . . . . . . . . . . . . .43
6.2. CONDITIONS PRECEDENT TO ALL CREDIT EVENTS . . . . . . . . . . . .44

SECTION 7. REPRESENTATIONS AND WARRANTIES. . . . . . . . . . . . . . . . . .44
7.1. CORPORATE STATUS, ETC.. . . . . . . . . . . . . . . . . . . . . .44
7.2. SUBSIDIARIES. . . . . . . . . . . . . . . . . . . . . . . . . . .45
7.3. CORPORATE POWER AND AUTHORITY, ETC. . . . . . . . . . . . . . . .45
7.4. NO VIOLATION. . . . . . . . . . . . . . . . . . . . . . . . . . .45

PAGE

7.5. GOVERNMENTAL APPROVALS. . . . . . . . . . . . . . . . . . . . . . 45
7.6. LITIGATION. . . . . . . . . . . . . . . . . . . . . . . . . . . .45
7.7. USE OF PROCEEDS; MARGIN REGULATIONS . . . . . . . . . . . . . . .45
7.8. FINANCIAL STATEMENTS, ETC.. . . . . . . . . . . . . . . . . . . .46
7.9. NO MATERIAL ADVERSE CHANGE. . . . . . . . . . . . . . . . . . . .46
7.10. TAX RETURNS AND PAYMENTS. . . . . . . . . . . . . . . . . . . . .46
7.11. TITLE TO PROPERTIES, ETC. . . . . . . . . . . . . . . . . . . . .46
7.12. LAWFUL OPERATIONS, ETC. . . . . . . . . . . . . . . . . . . . . .47
7.13. ENVIRONMENTAL MATTERS . . . . . . . . . . . . . . . . . . . . . .47
7.14. COMPLIANCE WITH ERISA . . . . . . . . . . . . . . . . . . . . . .47
7.15. INTELLECTUAL PROPERTY, ETC. . . . . . . . . . . . . . . . . . . .47
7.16. INVESTMENT COMPANY. . . . . . . . . . . . . . . . . . . . . . . .47
7.17. LABOR RELATIONS . . . . . . . . . . . . . . . . . . . . . . . . .47
7.18. EXISTING INDEBTEDNESS . . . . . . . . . . . . . . . . . . . . . .48
7.19. YEAR 2000 COMPUTER MATTERS. . . . . . . . . . . . . . . . . . . .48
7.20. TRUE AND COMPLETE DISCLOSURE. . . . . . . . . . . . . . . . . . .48

SECTION 8. AFFIRMATIVE COVENANTS . . . . . . . . . . . . . . . . . . . . . .49
8.1. REPORTING REQUIREMENTS. . . . . . . . . . . . . . . . . . . . . .49
8.2. BOOKS, RECORDS AND INSPECTIONS. . . . . . . . . . . . . . . . . .51
8.3. INSURANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . .52
8.4. PAYMENT OF TAXES AND CLAIMS . . . . . . . . . . . . . . . . . . .52
8.5. CORPORATE FRANCHISES. . . . . . . . . . . . . . . . . . . . . . .52
8.6. GOOD REPAIR . . . . . . . . . . . . . . . . . . . . . . . . . . .52
8.7. COMPLIANCE WITH STATUTES, ETC.. . . . . . . . . . . . . . . . . .52
8.8. COMPLIANCE WITH ENVIRONMENTAL LAWS. . . . . . . . . . . . . . . .52
8.9. FISCAL YEARS, FISCAL QUARTERS . . . . . . . . . . . . . . . . . .53
8.10. CERTAIN SUBSIDIARIES TO JOIN IN SUBSIDIARY GUARANTY . . . . . . .53
8.11. HEDGE AGREEMENTS, ETC.. . . . . . . . . . . . . . . . . . . . . .54
8.12. MOST FAVORED COVENANT STATUS. . . . . . . . . . . . . . . . . . .54
8.13. SENIOR DEBT . . . . . . . . . . . . . . . . . . . . . . . . . . .54

SECTION 9. NEGATIVE COVENANTS. . . . . . . . . . . . . . . . . . . . . . . .54
9.1. CHANGES IN BUSINESS . . . . . . . . . . . . . . . . . . . . . . .54
9.2. CONSOLIDATION, MERGER, ACQUISITIONS, ASSET SALES, ETC.. . . . . .55
9.3. LIENS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .56
9.4. INDEBTEDNESS. . . . . . . . . . . . . . . . . . . . . . . . . . .57
9.5. ADVANCES, INVESTMENTS, LOANS AND GUARANTY OBLIGATIONS . . . . . .58
9.6. MINIMUM CONSOLIDATED NET WORTH . . . . . . . . . . . . . . . . .59
9.7. SENIOR LEVERAGE RATIO . . . . . . . . . . . . . . . . . . . . . .60
9.8. TOTAL LEVERAGE RATIO. . . . . . . . . . . . . . . . . . . . . . .60
9.9. FIXED CHARGE COVERAGE RATIO . . . . . . . . . . . . . . . . . . .60
9.10. RATIO OF CONSOLIDATED CURRENT ASSETS/CONSOLIDATED CURRENT
LIABILITIES PLUS CONSOLIDATED TOTAL SENIOR BALANCE
SHEET DEBT . . . . . . . . . . . . . . . . . . . . . . . . . . 60
9.11. ANNUAL CLEAN DOWN . . . . . . . . . . . . . . . . . . . . . . . .60
9.12. LIMITATION ON SUBSIDIARY INDEBTEDNESS . . . . . . . . . . . . . .61
9.13. LIMITATION ON CERTAIN RESTRICTIVE AGREEMENTS. . . . . . . . . . .61
9.14. PREPAYMENTS AND REFINANCINGS OF OTHER DEBT, ETC.. . . . . . . . .61
9.15. TRANSACTIONS WITH AFFILIATES. . . . . . . . . . . . . . . . . . .62
9.16. PLAN TERMINATIONS, MINIMUM FUNDING, ETC.. . . . . . . . . . . . .62

PAGE

SECTION 10. EVENTS OF DEFAULT . . . . . . . . . . . . . . . . . . . . . . . .62
10.1. EVENTS OF DEFAULT . . . . . . . . . . . . . . . . . . . . . . . .62
10.2. ACCELERATION, ETC.. . . . . . . . . . . . . . . . . . . . . . . .64
10.3. APPLICATION OF LIQUIDATION PROCEEDS . . . . . . . . . . . . . . .64

SECTION 11. THE ADMINISTRATIVE AGENT. . . . . . . . . . . . . . . . . . . . .65
11.1. APPOINTMENT . . . . . . . . . . . . . . . . . . . . . . . . . . .65
11.2. DELEGATION OF DUTIES. . . . . . . . . . . . . . . . . . . . . . .65
11.3. EXCULPATORY PROVISIONS. . . . . . . . . . . . . . . . . . . . . .65
11.4. RELIANCE BY ADMINISTRATIVE AGENT. . . . . . . . . . . . . . . . .66
11.5. NOTICE OF DEFAULT . . . . . . . . . . . . . . . . . . . . . . . .66
11.6. NON-RELIANCE. . . . . . . . . . . . . . . . . . . . . . . . . . .66
11.7. INDEMNIFICATION . . . . . . . . . . . . . . . . . . . . . . . . .67
11.8. THE ADMINISTRATIVE AGENT IN INDIVIDUAL CAPACITY . . . . . . . . .67
11.9. SUCCESSOR ADMINISTRATIVE AGENT. . . . . . . . . . . . . . . . . .67
11.10. OTHER AGENTS. . . . . . . . . . . . . . . . . . . . . . . . . . .67

SECTION 12. MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . .67
12.1. PAYMENT OF EXPENSES ETC.. . . . . . . . . . . . . . . . . . . . .67
12.2. RIGHT OF SETOFF . . . . . . . . . . . . . . . . . . . . . . . . .69
12.3. NOTICES . . . . . . . . . . . . . . . . . . . . . . . . . . . . .69
12.4. BENEFIT OF AGREEMENT. . . . . . . . . . . . . . . . . . . . . . .69
12.5. NO WAIVER: REMEDIES CUMULATIVE. . . . . . . . . . . . . . . . . .72
12.6. PAYMENTS PRO RATA . . . . . . . . . . . . . . . . . . . . . . . .72
12.7. CALCULATIONS: COMPUTATIONS. . . . . . . . . . . . . . . . . . . .72
12.8. GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE;
WAIVER OF JURY TRIAL. . . . . . . . . . . . . . . . . . . . . .73
12.9. COUNTERPARTS. . . . . . . . . . . . . . . . . . . . . . . . . . .73
12.10. EFFECTIVENESS . . . . . . . . . . . . . . . . . . . . . . . . . .73
12.11. HEADINGS DESCRIPTIVE. . . . . . . . . . . . . . . . . . . . . . .73
12.12. AMENDMENT OR WAIVER . . . . . . . . . . . . . . . . . . . . . . .73
12.13. SURVIVAL OF INDEMNITIES . . . . . . . . . . . . . . . . . . . . .74
12.14. DOMICILE OF LOANS . . . . . . . . . . . . . . . . . . . . . . . .74
12.15. CONFIDENTIALITY . . . . . . . . . . . . . . . . . . . . . . . . .74
12.16. LENDER REGISTER . . . . . . . . . . . . . . . . . . . . . . . . .75
12.17. LIMITATIONS ON LIABILITY OF THE ISSUING BANKS . . . . . . . . . .75
12.18. GENERAL LIMITATION OF LIABILITY . . . . . . . . . . . . . . . . .75
12.19. NO DUTY . . . . . . . . . . . . . . . . . . . . . . . . . . . . .76
12.20. LENDERS AND AGENT NOT FIDUCIARY TO BORROWER, ETC. . . . . . . . .76
12.21. SURVIVAL OF REPRESENTATIONS AND WARRANTIES. . . . . . . . . . . .76
12.22. INTEREST RATE LIMITATION. . . . . . . . . . . . . . . . . . . . .76
12.23. JUDGMENT CURRENCY . . . . . . . . . . . . . . . . . . . . . . . .76

iii

ANNEX I - INFORMATION AS TO LENDERS

ANNEX II - INFORMATION AS TO SUBSIDIARIES

ANNEX III - DESCRIPTION OF EXISTING INDEBTEDNESS

ANNEX IV - DESCRIPTION OF EXISTING LIENS

ANNEX V - DESCRIPTION OF EXISTING ADVANCES, LOANS,
INVESTMENTS AND GUARANTEES

ANNEX VI - DESCRIPTION OF LETTERS OF CREDIT DEEMED ISSUED
UNDER THE CREDIT AGREEMENT

EXHIBIT A-1 - FORM OF GENERAL REVOLVING NOTE
EXHIBIT A-2 - FORM OF SWING LINE NOTE

EXHIBIT B-1 - FORM OF NOTICE OF BORROWING
EXHIBIT B-2 - FORM OF NOTICE OF CONVERSION
EXHIBIT B-3 - FORM OF LETTER OF CREDIT REQUEST

EXHIBIT C - FORM OF SUBSIDIARY GUARANTY

EXHIBIT D - FORM OF OPINION OF SPECIAL COUNSEL TO THE BORROWER

EXHIBIT E - FORM OF ASSIGNMENT AGREEMENT

EXHIBIT F - FORM OF SECTION 5.4(b)(ii) CERTIFICATE

CREDIT AGREEMENT, dated as of May 5, 1999, among the following:

(i) XX-XXX STORES, INC., an Ohio corporation (herein, together
with its successors and assigns, the "BORROWER");

(ii) the lending institutions listed in Annex I hereto (herein,
together with their respective successors and assigns, each a "LENDER" and
collectively, the "LENDERS");

(iii) THE FIRST NATIONAL BANK OF CHICAGO, one of the Lenders, in its
capacity as Documentation Agent (the "DOCUMENTATION AGENT");

(iv) COMERICA BANK, one of the Lenders, and NATIONAL CITY BANK, one
of the Lenders, each in their capacity as a Co-Agent (a "CO-AGENT"); and

(v) KEYBANK NATIONAL ASSOCIATION, a national banking association,
as a Lender, the Swing Line Lender, the Issuing Bank and as the
Administrative Agent

PRELIMINARY STATEMENTS:

(1) Unless otherwise defined herein, all capitalized terms used herein and
defined in section 1 are used herein as so defined.

(2) The Borrower has applied to the Lenders for credit facilities in the
aggregate amount of $300,000,000 in order to refinance certain Indebtedness of
the Borrower, to finance Acquisitions and in order to provide working capital
and funds for other lawful purposes.

(3) Subject to and upon the terms and conditions set forth herein, the
Lenders are willing to make available to the Borrower the credit facilities
provided for herein.

NOW, THEREFORE, it is agreed:

SECTION 1. DEFINITIONS AND TERMS.

1.1. CERTAIN DEFINED TERMS. As used herein, the following terms shall have
the meanings herein specified unless the context otherwise requires:

"ACQUISITION" shall mean and include (i) any acquisition on a going concern
basis (whether by purchase, lease or otherwise) of any facility and/or business
operated by any person who is not a Subsidiary of the Borrower, and (ii)
acquisitions of a majority of the outstanding equity or other similar interests
in any such person (whether by merger, stock purchase or otherwise).

"ADJUSTED LIBO RATE" means, with respect to any Eurodollar Borrowing for
any Interest Period, an interest rate per annum (rounded upwards, if necessary,
to the next 1/16 of 1%) equal to (i) the LIBO Rate for such Interest Period,
MULTIPLIED BY (ii) the Statutory Reserve Rate.

"ADMINISTRATIVE AGENT" shall have the meaning provided in the first
paragraph of this Agreement and shall include any successor to the
Administrative Agent appointed pursuant to section 11.9.

"AFFILIATE" shall mean, with respect to any person, any other person
directly or indirectly controlling, controlled by, or under direct or indirect
common control with such person. A person shall be deemed to control a second
person if such first person possesses, directly or indirectly, the power (i) to
vote 10% or more of the securities having ordinary voting power for the election
of directors or managers of such second person or (ii) to direct or cause the
direction of the management and policies of such second person, whether through
the ownership of voting securities, by contract or otherwise. Notwithstanding
the foregoing, (x) a director, officer or employee of a person shall not, solely
by reason of such status, be considered an Affiliate of such person; and (y)
neither the Administrative Agent nor any Lender shall in any event be considered
an Affiliate of the Borrower or any other Credit Party or any of their
respective Subsidiaries.

"AGREEMENT" shall mean this Credit Agreement, as the same may be from time
to time further modified, amended and/or supplemented.

"ALTERNATIVE CURRENCY" shall mean and include any lawful currency other
than Dollars which is (i) readily and freely transferable and convertible into
Dollars, and (ii) is acceptable to the Required Lenders and any applicable
Issuing Bank.

"APPLICABLE EURODOLLAR MARGIN" shall have the meaning provided in section
2.6(g).

"APPLICABLE FACILITY FEE RATE" shall have the meaning provided in section
4.1(a).

"APPLICABLE LENDING OFFICE" shall mean, (i) with respect to each Lender
with a General Revolving Commitment, (A) such Lender's Domestic Lending Office
in the case of Borrowings consisting of Prime Rate Loans, and (B) such Lender's
Eurodollar Lending Office in the case of Borrowings consisting of Eurodollar
Loans, and (ii) with respect to the Swing Line Lender, its Domestic Lending
Office.

"ASSET SALE" shall mean the sale, transfer or other disposition (including
by means of Sale and Lease-Back Transactions, and by means of mergers,
consolidations, and liquidations of a corporation, partnership or limited
liability company of the interests therein of the Borrower or any Subsidiary) by
the Borrower or any Subsidiary to any person other than the Borrower or any
Subsidiary of any of their respective assets, PROVIDED that the term Asset Sale
specifically excludes any sales, transfers or other dispositions of inventory,
or obsolete or excess furniture, fixtures, equipment or other property, tangible
or intangible, in each case in the ordinary course of business.

"ASSIGNMENT AGREEMENT" shall mean an Assignment Agreement substantially in
the form of Exhibit E hereto.

"AUTHORIZED OFFICER" shall mean any officer or employee of the Borrower
designated as such in writing to the Administrative Agent by the Borrower.

"BANKRUPTCY CODE" shall have the meaning provided in section 10.1(h).

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

"BORROWING" shall mean and include:

(i) the incurrence of General Revolving Loans, consisting of
one Type of Loan, by the Borrower from all of the Lenders having
Commitments in respect thereof on a PRO RATA basis on a given date
(or resulting from a Conversion or a Continuation on a given date),
having in the case of Eurodollar Loans the same Interest Period;
and/or

(ii) the incurrence of a single Type of Swing Line Loan by
the Borrower from the Swing Line Lender on a given date.

"BUSINESS DAY" shall mean (i) for all purposes other than as covered by
clause (ii) below, any day excluding Saturday, Sunday and any day which shall be
in the city in which the Payment Office is located a legal holiday or a day on
which banking institutions are authorized by law or other governmental actions
to close and (ii) with respect to all notices and determinations in connection
with, and payments of principal and interest on, Eurodollar Loans, any day which
is a Business Day described in clause (i) and which is also a day for trading by
and between banks in U.S. dollar deposits in the interbank Eurodollar market.

"CAPITAL LEASE" as applied to any person shall mean any lease of any
property (whether real, personal or mixed) by that person as lessee which, in
conformity with GAAP, is accounted for as a capital lease on the balance sheet
of that person.

"CAPITALIZED LEASE OBLIGATIONS" shall mean all obligations under Capital
Leases of the Borrower or any of its Subsidiaries in each case taken at the
amount thereof accounted for as liabilities identified as "capital lease
obligations" (or any similar words) on a consolidated balance sheet of the
Borrower and its Subsidiaries prepared in accordance with GAAP.

"CASH EQUIVALENTS" shall mean any of the following:

(i) securities issued or directly and fully guaranteed or
insured by the United States of America or any agency or
instrumentality thereof (PROVIDED that the full faith and credit of
the United States of America is pledged in support thereof) having
maturities of not more than one year from the date of acquisition;

(ii) U.S. dollar denominated time deposits, certificates of
deposit and bankers' acceptances of (x) any Lender or (y) any bank
whose short-term commercial paper rating from S&P is at least A-1 or
the equivalent thereof or from Xxxxx'x is at least P-1 or the
equivalent thereof (any such bank, an "APPROVED BANK"), in each case
with maturities of not more than 180 days from the date of
acquisition;

(iii) commercial paper issued by any Lender or Approved Bank
or by the parent company of any Lender or Approved Bank and
commercial paper issued by, or guaranteed by, any industrial or
financial company with a short- term commercial paper rating of at
least A-1 or the equivalent thereof by S&P or at least P-1 or the
equivalent thereof by Moody's, or guaranteed by any industrial
company with a long term unsecured debt rating of at least A or A2,
or the equivalent of each thereof, from S&P or Moody's, as the case
may be, and in each case maturing within 270 days after the date of
acquisition;

(iv) investments in money market funds substantially all the
assets of which are comprised of securities of the types described
in clauses (i) through (iii) above;

(v) investments in money market funds access to which is
provided as part of "sweep" accounts maintained with a Lender or an
Approved Bank;

(vi) investments in industrial development revenue bonds
which (i) "re-set" interest rates not less frequently than
quarterly, (ii) are entitled to the benefit of a remarketing
arrangement with an established broker dealer, and (iii) are
supported by a direct pay letter of credit covering principal and
accrued interest which is issued by an Approved Bank; and

(vii) investments in pooled funds or investment accounts
consisting of investments of the nature described in the foregoing
clause (vi).

"CHANGE OF CONTROL" shall mean and include any of the following:

(i) during any period of two consecutive calendar years,
individuals who at the beginning of such period constituted the
Borrower's Board of Directors (together with any new directors (x)
whose election by the Borrower's Board of Directors was, or (y)
whose nomination for election by the Borrower's shareholders was
(prior to the date of the proxy or consent solicitation relating to
such nomination), approved by a vote of at least two-thirds of the
directors then still in office who either were directors at the
beginning of such period or whose election or nomination for
election was previously so approved), cease for any reason to
constitute a majority of the directors then in office;

(ii) any person or group (as such term is defined in section
13(d)(3) of the 1934 Act), OTHER THAN (x) the Borrower, (y) any
trustee or other fiduciary holding securities under an employee
benefit plan of the Borrower and (z) the Current Holder Group, shall
acquire, directly or indirectly, beneficial ownership (within the
meaning of Rule 13d-3 and 13d-5 of the 0000 Xxx) of more than 33%,
on a fully diluted basis, of the economic or voting interest in the
Borrower's capital stock;

(iii) the shareholders of the Borrower approve a merger or
consolidation of the Borrower with any other person, OTHER than a
merger or consolidation which would result in the voting securities
of the Borrower outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted or
exchanged for voting securities of the surviving or resulting
entity) more than 75% of the combined voting power of the voting
securities of the Borrower or such surviving or resulting entity
outstanding after such merger or consolidation;

(iv) the shareholders of the Borrower approve a plan of
complete liquidation of the Borrower or an agreement or agreements
for the sale or disposition by the Borrower of all or substantially
all of the Borrower's assets; and/or

(v) any "Change of Control" or similar term as defined in
any agreement or instrument evidencing or governing Indebtedness of
the Borrower in an original aggregate principal amount of at least
$10,000,000.

As used in this definition, the term "CURRENT HOLDER GROUP" shall mean (i) those
persons who are officers and directors of the Borrower at the Effective Date,
(ii) the spouses, heirs, legatees, descendants and blood relatives to the third
degree of consanguinity of any such person, (iii) the executors and
administrators of the estate of any such person, and any court appointed
guardian of any such person, and (iv) any trust, family partnership or similar
investment entity for the benefit of any such person referred to in the
foregoing clauses (i) and (ii) or any other persons, so long as one or more
members of the Current Holder Group has the exclusive or a joint right to
control the voting and disposition of securities held by such trust, family
partnership or other investment entity.

"CLOSING DATE" shall mean the date, on or after the Effective Date, upon
which the conditions specified in section 6.1 are satisfied.

"CODE" shall mean the Internal Revenue Code of 1986, as amended from time
to time, and the regulations promulgated and the rulings issued thereunder.
Section references to the Code are to the Code, as in effect at the Effective
Date and any subsequent provisions of the Code, amendatory thereof, supplemental
thereto or substituted therefor.

"COMMITMENT" shall mean, with respect to each Lender, its General Revolving
Commitment or its Swing Line Commitment, or both, if such Lender shall have both
a General Revolving Commitment or its Swing Line Commitment.

"CONSOLIDATED AMORTIZATION EXPENSE" shall mean, for any period, all
amortization expenses of the Borrower and its Subsidiaries, all as determined
for the Borrower and its Subsidiaries on a consolidated basis in accordance with
GAAP.

"CONSOLIDATED CAPITAL EXPENDITURES" shall mean, for any period, the
aggregate of all expenditures (whether paid in cash or accrued as liabilities
and including in all events amounts expended or capitalized under Capital Leases
but excluding any amount representing capitalized interest) by the Borrower and
its Subsidiaries during that period that, in conformity with GAAP, are or are
required to be included in the property, plant or equipment reflected in the
consolidated balance sheet of the Borrower and its Subsidiaries. Notwithstanding
the foregoing, amounts expended to complete, or capitalized in connection with
the completion of, Permitted Acquisitions, shall not constitute Consolidated
Capital Expenditures.

"CONSOLIDATED CURRENT ASSETS" shall mean, as at the date of any
determination, the net book value of all assets of the Borrower and its
Subsidiaries that would be classified as current assets in accordance with GAAP
on a consolidated balance sheet of the Borrower and its Subsidiaries as of such
date prepared in accordance with GAAP.

"CONSOLIDATED CURRENT LIABILITIES" shall mean, as at the date of any
determination, all liabilities of the Borrower and its Subsidiaries that would
be classified as current liabilities in accordance with GAAP on a consolidated
balance sheet of the Borrower and its Subsidiaries as of such date prepared in
accordance with GAAP; PROVIDED that for purposes of this definition no portion
of the principal amount of the Loans shall in any event be treated as a current
liability.

"CONSOLIDATED DEPRECIATION EXPENSE" shall mean, for any period, all
depreciation expenses of the Borrower and its Subsidiaries, all as determined
for the Borrower and its Subsidiaries on a consolidated basis in accordance with
GAAP.

"CONSOLIDATED INCOME TAX EXPENSE" shall mean, for any period, all
provisions for taxes based on the net income of the Borrower or any of its
Subsidiaries (including, without limitation, any additions to such taxes, and
any penalties and interest with respect thereto), all as determined for the
Borrower and its Subsidiaries on a consolidated basis in accordance with GAAP.

"CONSOLIDATED NET FIXED REAL PROPERTY LEASE CHARGES" shall mean, for any
period, (i) all fixed rental expenses of the Borrower and its Subsidiaries
arising under all leases of Real Property (including Capital Leases and
"operating leases") for such period, LESS (ii) any sublease rentals receivable
by the Borrower and its Subsidiaries for such period for the sublease to persons
other than Affiliates of any such Real Property, in each case determined on a
consolidated basis for the Borrower and its Subsidiaries for such period in
accordance with GAAP. In the case of any lease or sublease covering both Real
Property and personal property, the component of rental expense or rental income
relating to the personal property shall be excluded from the determination of
Consolidated Net Fixed Real Property Lease Charges.

"CONSOLIDATED NET INCOME" shall mean for any period, the net income (or
loss) of the Borrower and its Subsidiaries on a consolidated basis for such
period taken as a single accounting period determined in conformity with GAAP.

"CONSOLIDATED NET INTEREST EXPENSE" shall mean, for any period, (i) total
interest expense (including that which is capitalized and that which is
attributable to Capital Leases, in accordance with GAAP) of the Borrower and its
Subsidiaries on a consolidated basis with respect to all outstanding
Indebtedness of the Borrower and its Subsidiaries including, without limitation,
net costs under Hedge Agreements, but excluding, however, any amortization of
deferred financing costs, LESS (ii) net interest income of the Borrower and its
Subsidiaries on a consolidated basis, all as determined for the Borrower and its
Subsidiaries on a consolidated basis in accordance with GAAP.

"CONSOLIDATED NET WORTH" shall mean at any time for the determination
thereof all amounts which, in conformity with GAAP, would be included under the
caption "total stockholders' equity" (or any like caption) on a consolidated
balance sheet of the Borrower as at such date, PROVIDED that in no event shall
Consolidated Net Worth include any amounts in respect of Redeemable Stock.

"CONSOLIDATED TOTAL ASSETS" shall mean, at any time, the total net book
value of all assets of the Borrower and its Subsidiaries which would be shown as
assets on a consolidated balance sheet of the Borrower and its Subsidiaries at
such time prepared in accordance with GAAP, after eliminating all amounts
properly attributable to minority interests, if any, in the stock and surplus of
Subsidiaries.

"CONSOLIDATED TOTAL BALANCE SHEET DEBT" shall mean, without duplication, at
any date of determination (i) the principal amount of all Indebtedness for
borrowed money or represented by bonds, notes or debentures, (ii) all
Capitalized Lease Obligations, and (iii) all other amounts representing or
equivalent to the principal amount of Indebtedness, in all such cases only to
the extent the same would appear as liabilities on a consolidated balance sheet
of the Borrower and its Subsidiaries as of such date which is prepared in
accordance with GAAP.

"CONSOLIDATED TOTAL CAPITAL" shall mean, as of any date of determination,
the sum of (i) Consolidated Total Balance Sheet Debt and (ii) Consolidated Net
Worth.

"CONSOLIDATED TOTAL SENIOR BALANCE SHEET DEBT" shall mean without
duplication, at any date of determination, (i) Consolidated Total Balance Sheet
Debt, LESS (ii) the aggregate outstanding principal amount of the Subordinated
Notes.

"CONTINUE", "CONTINUATION" and "CONTINUED" each refers to a continuation of
General Revolving Loans consisting of Eurodollar Loans for an additional
Interest Period as provided in section 2.7.

"CONVERT", "CONVERSION" and "CONVERTED" each refers to a conversion of
General Revolving Loans of one Type into General Revolving Loans of another
Type, pursuant to section 2.5, 2.7(b), 2.8(b) or 5.2.

"CREDIT DOCUMENTS" shall mean this Agreement, the Notes, the Subsidiary
Guaranty and any Letter of Credit Document.

"CREDIT EVENT" shall mean the making of any Loans and/or the issuance of
any Letter of Credit.

"CREDIT PARTY" shall mean the Borrower and each of its Subsidiaries which
is a party to any Credit Document.

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

"DEFAULTING LENDER" shall mean any Lender with respect to which a Lender
Default is in effect.

"DOCUMENTARY LETTER OF CREDIT" shall have the meaning provided in section
3.1(a).

"DOLLARS", "U.S. DOLLARS", "U.S.DOLLARS", "DOLLARS" and the sign "$" each
means lawful money of the United States.

"DOMESTIC LENDING OFFICE" shall mean, with respect to any Lender, the
office of such Lender specified as its Domestic Lending Office in Annex I or in
the Assignment Agreement pursuant to which it became a Lender, or such other
office of such Lender as such Lender may from time to time specify to the
Borrower and the Administrative Agent.

"EFFECTIVE DATE" shall have the meaning provided in section 12.10.

"ELIGIBLE TRANSFEREE" shall mean and include a commercial bank, financial
institution or other "accredited investor" (as defined in SEC Regulation D), in
each case which

(i) is not disapproved in writing by the Borrower in a
notice given to a requesting Lender and the Administrative Agent,
specifying the reasons for such disapproval, within two Business
Days following the giving of notice to the Borrower of the identity
of any proposed transferee (any such disapproval by the Borrower
must be reasonable), PROVIDED that the Borrower shall not be
entitled to exercise the foregoing right of disapproval if and so
long as any Default under section 10.1(a) or Event of Default shall
have occurred and be continuing; and

(ii) is not a direct competitor of the Borrower or engaged
in the same or similar principal lines of business as the Borrower
and its Subsidiaries considered as a whole, or is not an Affiliate
of any such competitor of the Borrower and its Subsidiaries.

"ENVIRONMENTAL LAWS" means all laws, rules, regulations, codes, ordinances,
orders, decrees, judgments, injunctions, notices or binding agreements issued,
promulgated or entered into by any Governmental Authority, relating in any way
to the environment, preservation or reclamation of natural resources, the
management, release or threatened release of any Hazardous Materials or to
health and safety matters.

"ENVIRONMENTAL LIABILITY" means any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of the Borrower or any Subsidiary directly or
indirectly resulting from or based upon (a) violation of any Environmental Law,
(b) the generation, use, handling, transportation, storage, treatment or
disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials,
(d) the release or threatened release of any Hazardous Materials into the
environment or (e) any contract, agreement or other consensual arrangement
pursuant to which liability is assumed or imposed with respect to any of the
foregoing.

"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the regulations promulgated and rulings issued
thereunder. Section references to ERISA are to ERISA, as in effect at the
Effective Date and any subsequent provisions of ERISA, amendatory thereof,
supplemental thereto or substituted therefor.

"ERISA AFFILIATE" shall mean each person (as defined in section 3(9) of
ERISA) which together with the Borrower or a Subsidiary of the Borrower would be
deemed to be a "single employer" (i) within the meaning of section 414(b),(c),
(m) or (o) of the Code or (ii) as a result of the Borrower or a Subsidiary of
the Borrower being or having been a general partner of such person.

"EURODOLLAR BORROWING" shall mean a Borrowing under the General Revolving
Facility consisting of Eurodollar Loans.

"EURODOLLAR LENDING OFFICE" shall mean, with respect to any Lender, the
office of such Lender specified as its Eurodollar Lending Office in Annex I or
in the Assignment Agreement pursuant to which it became a Lender, or such other
office or offices for Eurodollar Loans of such Lender as such Lender may from
time to time specify to the Borrower and the Administrative Agent.

"EURODOLLAR LOANS" shall mean each General Revolving Loan bearing interest
at the rates provided in section 2.6(b).

"EVENT OF DEFAULT" shall have the meaning provided in section 10.1.

"EXISTING INDEBTEDNESS" shall have the meaning provided in section 7.18.

"EXISTING INDEBTEDNESS AGREEMENTS" shall have the meaning provided in
section 7.18.

"EXISTING LETTER OF CREDIT" shall have the meaning provided in section
3.1(e).

"FACILITY" shall mean either the General Revolving Facility or the Swing
Line Facility, or both, if the context so requires.

"FACILITY FEE" shall have the meaning provided in section 4.1(a).

"FEDERAL FUNDS EFFECTIVE RATE" shall mean, for any period, a fluctuating
interest rate equal for each day during such period to the weighted average of
the rates on overnight Federal Funds transactions with members of the Federal
Reserve System arranged by Federal Funds brokers, as published for such day (or,
if such day is not a Business Day, for the next preceding Business Day) by the
Federal Reserve Bank of New York, or, if such rate is not so published for any
day which is a Business Day, the average of the quotations for such day on such
transactions received by the Administrative Agent from three Federal Funds
brokers of recognized standing selected by the Administrative Agent.

"FEES" shall mean all fees, commissions and other amounts payable pursuant
to, or referred to in, section 4.1 hereof.

"FIXED CHARGE COVERAGE RATIO" shall mean, for any Testing Period, the ratio
of

(i) Consolidated Net Income for such Testing Period, PLUS
the following, to the extent deducted in determining such
Consolidated Net Income: (A) Consolidated Net Interest Expense, (B)
Consolidated Income Tax Expense, (C) Consolidated Depreciation, (D)
Consolidated Amortization, (E) Consolidated Net Fixed Real Property
Lease Charges, and (F) in the case of any Testing Period which
includes any portion of the Borrower's 1999 fiscal year, the charges
during such Testing Period related to the acquisition of House of
Fabrics, Inc. (such charges aggregated not more than $16,000,000 on
an after tax basis for the 1999 fiscal year),

(ii) the sum for such Testing Period of: (A) Consolidated
Net Fixed Real Property Lease Charges, (B) Consolidated Net Interest
Expense, (C) scheduled or mandatory repayments, prepayments or
redemptions of the principal of Indebtedness (including required
reductions in committed credit facilities), and (D) without
duplication of any amount included under the preceding clause (C),
scheduled payments representing the principal portion of Capitalized
Lease Obligations,

in each case on a consolidated basis for the Borrower and its Subsidiaries for
such Testing Period; PROVIDED that, notwithstanding anything to the contrary
contained herein, the Borrower's Fixed Charge Coverage Ratio for any Testing
Period shall be computed by giving PRO FORMA effect to (x) the inclusion of the
appropriate financial items for any person or business unit which has been
acquired by the Borrower for any portion of such Testing Period prior to the
date of acquisition, and (y) the exclusion of the appropriate financial items
for any person or business unit which has been disposed of by the Borrower, for
the portion of such Testing Period prior to the date of disposition.

"FOREIGN SUBSIDIARY" shall mean any Subsidiary (i) which is not
incorporated in the United States and substantially all of whose assets and
properties are located, or substantially all of whose business is carried on,
outside the United States, or (ii) substantially all of whose assets consist of
Subsidiaries that are Foreign Subsidiaries as defined in clause (i) of this
definition.

"GAAP" shall mean generally accepted accounting principles in the United
States of America as in effect from time to time; it being understood and agreed
that determinations in accordance with GAAP for purposes of section 9, including
defined terms as used therein, are subject (to the extent provided therein) to
sections 1.3 and 12.7(a).

"GENERAL REVOLVING COMMITMENT" shall mean, with respect to each Lender, the
amount, if any, set forth opposite such Lender's name in Annex I as its "General
Revolving Commitment" as the same may be reduced from time to time pursuant to
section 4.2, adjusted from time to time as a result of assignments to or from
such Lender pursuant to section 12.4(c), or terminated pursuant to section 4.2,
4.3 or 10.2.

"GENERAL REVOLVING CREDIT EXPOSURE" shall mean, for any Lender at any time,
its General Revolving Facility Percentage of the Total General Revolving Credit
Exposure at such time.

"GENERAL REVOLVING FACILITY" shall mean the Facility evidenced by the Total
General Revolving Commitment.

"GENERAL REVOLVING FACILITY PERCENTAGE" shall mean at any time for any
Lender with a General Revolving Commitment, the percentage obtained by dividing
such Lender's General Revolving Commitment by the Total General Revolving
Commitment, PROVIDED, that if the Total General Revolving Commitment has been
terminated, the General Revolving Facility Percentage for each Lender shall be
determined by dividing such Lender's General Revolving Commitment immediately
prior to such termination by the Total General Revolving Commitment immediately
prior to such termination.

"GENERAL REVOLVING LOAN" shall have the meaning provided in section 2.1(a).

"GENERAL REVOLVING NOTE" shall have the meaning provided in section 2.4(a).

"GOVERNMENTAL AUTHORITY" means the government of the United States of
America, any other nation or any political subdivision thereof, whether state or
local, and any agency, authority, instrumentality, regulatory body, court,
central bank or other entity exercising executive, legislative, judicial,
taxing, regulatory or administrative powers or functions of or pertaining to
government.

"GUARANTY OBLIGATIONS" shall mean as to any person (without duplication)
any obligation of such person guaranteeing any Indebtedness ("PRIMARY
INDEBTEDNESS") of any other person (the "PRIMARY OBLIGOR") in any manner,
whether directly or indirectly, including, without limitation, any obligation of
such person, whether or not contingent, (a) to purchase any such primary
Indebtedness or any property constituting direct or indirect security therefor,
(b) to advance or supply funds (i) for the purchase or payment of any such
primary Indebtedness or (ii) to maintain working capital or equity capital of
the primary obligor or otherwise to maintain the net worth or solvency of the
primary obligor, (c) to purchase property, securities or services primarily for
the purpose of assuring the owner of any such primary Indebtedness of the
ability of the primary obligor to make payment of such primary Indebtedness, or
(d) otherwise to assure or hold harmless the owner of such primary Indebtedness
against loss in respect thereof, PROVIDED, HOWEVER, that the term Guaranty
Obligation shall not include endorsements of instruments for deposit or
collection in the ordinary course of business. The amount of any Guaranty
Obligation shall be deemed to be an amount equal to the stated or determinable
amount of the primary Indebtedness in respect of which such Guaranty Obligation
is made (taking into account, if applicable, any percentage or monetary
limitation upon the liability of such person under such Guaranty Obligation) or,
if not stated or determinable, the maximum reasonably anticipated liability in
respect thereof (assuming such person is required to perform thereunder) as
determined by such person in good faith.

"HAZARDOUS MATERIALS" shall mean (i) any petrochemical or petroleum
products, radioactive materials, asbestos in any form that is or could become
friable, urea formaldehyde foam insulation, transformers or other equipment that
contain dielectric fluid containing levels of polychlorinated biphenyls, and
radon gas; and (ii) any chemicals, materials or substances defined as or
included in the definition of "hazardous substances", "hazardous wastes",
"hazardous materials", "restricted hazardous materials", "extremely hazardous
wastes", "restrictive hazardous wastes", "toxic substances", "toxic pollutants",
"contaminants" or "pollutants", or words of similar meaning and regulatory
effect, under any applicable Environmental Law.

"HEDGE AGREEMENT" shall mean (i) any interest rate swap agreement, any
interest rate cap agreement, any interest rate collar agreement or other similar
agreement or arrangement designed to protect against fluctuations in

interest rates, and (ii) any currency swap agreement, forward currency purchase
agreement or similar agreement or arrangement designed to protect against
fluctuations in currency exchange rates.

"INDEBTEDNESS" of any person shall mean without duplication:

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

(ii) all bonds, notes, debentures and similar debt
securities of such person;

(iii) the deferred purchase price of capital assets or
services which in accordance with GAAP would be shown on the
liability side of the balance sheet of such person;

(iv) the face amount of all letters of credit issued for the
account of such person and, without duplication, all drafts drawn
thereunder;

(v) all obligations, contingent or otherwise, of such person
in respect of bankers' acceptances;

(vi) all indebtedness of a second person secured by any Lien
on any property owned by such first person, whether or not such
indebtedness has been assumed;

(vii) all Capitalized Lease Obligations of such person;

(viii) the present value, determined on the basis of the
implicit interest rate, of all basic rental obligations under all
Synthetic Leases of such person;

(ix) all obligations of such person to pay a specified
purchase price for goods or services whether or not delivered or
accepted, I.E., take-or-pay and similar obligations;

(x) all net obligations of such person under Hedge
Agreements;

(xi) the full outstanding balance of trade receivables,
notes or other instruments sold with full recourse (and the portion
thereof subject to potential recourse, if sold with limited
recourse), other than in any such case any thereof sold solely for
purposes of collection of delinquent accounts;

(xii) the stated value, or liquidation value if higher, of
all Redeemable Stock of such person; and

(xiii) all Guaranty Obligations of such person;

PROVIDED that (x) neither trade payables nor other similar accrued expenses, in
each case arising in the ordinary course of business, nor obligations in respect
of insurance policies or performance or surety bonds which themselves are not
guarantees of Indebtedness (nor drafts, acceptances or similar instruments
evidencing the same nor obligations in respect of letters of credit supporting
the payment of the same), shall constitute Indebtedness; and (y) the
Indebtedness of any person shall in any event include (without duplication) the
Indebtedness of any other entity (including any general partnership in which
such person is a general partner) to the extent such person is liable thereon as
a result of such person's ownership interest in or other relationship with such
entity, except to the extent the terms of such Indebtedness provide expressly
that such person is not liable thereon.

"INTEREST PERIOD" with respect to any Eurodollar Loan shall mean the
interest period applicable thereto, as determined pursuant to section 2.7.

"ISSUING BANK" shall mean (i) in respect of each Existing Letter of Credit,
the Lender that has issued same as of the Effective Date; and/or (ii) in respect
of any Letter of Credit issued after the Effective Date for any of the purposes
contemplated by section 3, the Lender which has issued same, which shall be (1)
KeyBank, or (2) such other Lender as may (x) be designated by the Borrower as a
replacement for the then incumbent Issuing Bank upon not less than 30 days'
prior written notice to all of the Lenders and (y) agree to so act in a
contemporaneous written notice given by such other Lender to the Borrower, the
Administrative Agent and all of the Lenders other than itself.

"KEYBANK" shall mean KeyBank National Association, a national banking
association, together with its successors and assigns.

"LC DISBURSEMENT" shall mean shall mean a payment made by the Issuing Bank
pursuant to a Letter of Credit to the beneficiary thereof (or its assignee),
including (without limitation) any payment made by the Issuing Bank under a
banker's acceptance or sight or time draft drawn on the Issuing Bank in
connection with a Letter of Credit.

"LC EXPOSURE" shall mean, for any Lender at any time, its General Revolving
Facility Percentage of the Total LC Exposure at such time.

"LEASEHOLDS" of any person means all the right, title and interest of such
person as lessee or licensee in, to and under leases or licenses of land,
improvements and/or fixtures.

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

"LENDER DEFAULT" shall mean (i) the refusal (which has not been retracted)
of a Lender in violation of the requirements of this Agreement to make available
its portion of any incurrence of Loans or to fund its Swing Line Participation
Amount under section 2.3(b) or its portion of any unreimbursed payment under
section 3.4(c), or (ii) a Lender having notified the Administrative Agent and/or
the Borrower that it does not intend to comply with the obligations under
section 2.1, 2.3 and/or 3.4(c), in the case of either (i) or (ii) as a result of
the appointment of a receiver or conservator with respect to such Lender at the
direction or request of any regulatory agency or authority.

"LENDER REGISTER" shall have the meaning provided in section 12.16.

"LETTER OF CREDIT" shall have the meaning provided in section 3.1(a).

"LETTER OF CREDIT DOCUMENTS" shall have the meaning specified in section
3.2(a).

"LETTER OF CREDIT FEE" shall have the meaning provided in section 4.1(b).

"LETTER OF CREDIT REQUEST" shall have the meaning provided in section
3.2(a).

"LIBO RATE" shall mean, with respect to any Eurodollar Borrowing for any
Interest Period, the rate appearing on Page 3750 of the Telerate Service (or on
any successor or substitute page of such Service, or any successor to or
substitute for such Service, providing rate quotations comparable to those
currently provided on such page of such Service, as determined by the
Administrative Agent from time to time for purposes of providing quotations of
interest rates applicable to dollar deposits in the London interbank market) at
approximately 11:00 a.m., London time, two Business Days prior to the
commencement of such Interest Period, as the rate for dollar deposits with a
maturity comparable to such Interest Period. In the event that such rate is not
available at such time for any reason, then the "LIBO RATE" with respect to such
Eurodollar Borrowing for such Interest Period shall be the rate (rounded
upwards, if necessary, to the next 1/16th of 1%) at which dollar deposits of
$5,000,000 and for a maturity comparable to such Interest Period are offered to
the Reference Banks in immediately available funds in the London interbank
market at approximately 11:00 a.m., London time, two Business Days prior to the
commencement of such Interest Period.

"LIEN" shall mean any mortgage, pledge, security interest, encumbrance,
lien or charge of any kind (including any agreement to give any of the
foregoing, any conditional sale or other title retention agreement or any lease
in the nature thereof).

"LOAN" shall have the meaning provided in section 2.1. As provided herein,
(i) Loans under the General Revolving Facility are General Revolving Loans, and
General Revolving Loans may be Eurodollar Loans or Prime Rate Loans, which are
the only Types of General Revolving Loans which can be outstanding hereunder;
and (ii) Loans under the Swing Line Facility are Swing Line Loans, and Swing
Line Loans may be Money Market Rate Loans or Prime Rate Loans, which are the
only Types of Swing Line Loans which can be outstanding hereunder.

"MARGIN STOCK" shall have the meaning provided in Regulation U.

"MATERIAL ADVERSE EFFECT" shall mean a material adverse effect on (i) the
business, operations, property, assets, liabilities or financial condition of,
(x) when used with reference to the Borrower or any of its Subsidiaries, the
Borrower and its Subsidiaries, taken as a whole, or (y) when used with reference
to any other person, such person and its Subsidiaries, taken as a whole, as the
case may be; (ii) the ability of the Borrower and the other Credit Parties to
perform their obligations under the Credit Documents; or (iii) the rights of or
benefits available to the Administrative Agent, any Issuing Bank, the Swing Line
Lender and the Lenders under the Credit Documents.

"MATERIAL SUBSIDIARY" shall mean, at any time, with reference to any
person, any Subsidiary of such person (i) that has assets at such time
comprising 5% or more of the consolidated assets of such person and its
Subsidiaries, or (ii) whose operations in the current fiscal year are expected
to, or whose operations in the most recent fiscal year did (or would have if
such person had been a Subsidiary for such entire fiscal year), represent 5% or
more of the consolidated earnings before interest, taxes, depreciation and
amortization of such person and its Subsidiaries for such fiscal year.

"MATURITY DATE" shall mean April 30, 2004, as such date may be extended in
accordance with section 4.4, or in any event such earlier date when the Total
Commitment is terminated.

"MINIMUM BORROWING AMOUNT" shall mean:

(i) for a Prime Rate Borrowing under the General Revolving
Facility, $1,000,000, with minimum increments thereafter of
$100,000, EXCEPT that (x) a Prime Rate Borrowing incurred under the
General Revolving Facility to finance payment of an LC Disbursement
in accordance with section 3.3(a) may be in such different amount as
is necessary for such purpose, and (y) a Prime Rate Borrowing under
the General Revolving Facility may in any event be in an amount
equal to the entire Unutilized Total General Revolving Commitment;

(ii) for a Eurodollar Borrowing under the General Revolving
Facility, $5,000,000, with minimum increments thereafter of
$1,000,000; or

(iii) for a Swing Line Loan, $100,000, with minimum
increments thereafter of $50,000.

"MONEY MARKET RATE LOAN" shall mean a Swing Line Loan, denominated in U.S.
Dollars, bearing interest at a Quoted Rate.

"MOODY'S" shall mean Xxxxx'x Investors Service, Inc. and its successors.

"MULTIEMPLOYER PLAN" shall mean a multiemployer plan, as defined in section
4001(a)(3) of ERISA to which the Borrower or any ERISA Affiliate is making or
accruing an obligation to make contributions or has within any of the preceding
three plan years made or accrued an obligation to make contributions.

"MULTIPLE EMPLOYER PLAN" shall mean an employee benefit plan, other than a
Multiemployer Plan, to which the Borrower or any ERISA Affiliate, and one or
more employers other than the Borrower or an ERISA Affiliate, is making or
accruing an obligation to make contributions or, in the event that any such plan
has been terminated, to which the Borrower or an ERISA Affiliate made or accrued
an obligation to make contributions during any of the five plan years preceding
the date of termination of such plan.

"1934 ACT" shall mean the Securities Exchange Act of 1934, as amended.

"NON-DEFAULTING LENDER" shall mean each Lender other than a Defaulting
Lender.

"NOTE" shall mean a General Revolving Note or a Swing Line Note, as
applicable.

"NOTICE OF BORROWING" shall have the meaning provided in section 2.2(a).

"NOTICE OF CONVERSION" shall have the meaning provided in section 2.5.

"NOTICE OFFICE" shall mean the office of the Administrative Agent at Key
Center, 000 Xxxxxx Xxxxxx, Xxxxxxxxx, Xxxx 00000, Attention: Large Corporate
Group (facsimile: (000) 000-0000), or such other office, located in a city in
the United States Eastern Time Zone, as the Administrative Agent may designate
to the Borrower from time to time.

"NOTICE OF SWING LINE REFUNDING" shall have the meaning provided in section
2.3(a).

"OBLIGATIONS" shall mean all amounts, direct or indirect, contingent or
absolute, of every type or description, and at any time existing, owing by the
Borrower or any other Credit Party to the Administrative Agent, any Issuing
Bank, the Swing Line Lender or any Lender pursuant to the terms of this
Agreement or any other Credit Document.

"OPERATING LEASE" as applied to any person shall mean any lease of any
property (whether real, personal or mixed) by that person as lessee which, in
conformity with GAAP, is not accounted for as a Capital Lease on the balance
sheet of that person.

"PARTICIPANT" shall have the meaning provided in section 3.4(a).

"PAYMENT OFFICE" shall mean the office of the Administrative Agent at Key
Center, 000 Xxxxxx Xxxxxx, Xxxxxxxxx, Xxxx 00000, Attention: Xxxxx Xxx of the
Large Corporate Group (telephone: (000) 000-0000; facsimile: (000) 000-0000), or
such other office, located in a city in the United States Eastern Time Zone, as
the Administrative Agent may designate to the Borrower from time to time.

"PBGC" shall mean the Pension Benefit Guaranty Corporation established
pursuant to Section 4002 of ERISA, or any successor thereto.

"PERMITTED ACQUISITION" shall mean and include any Acquisition as to which
all of the following conditions are satisfied:

(i) such Acquisition (A) involves a line or lines of
business which is complementary to the lines of business in which
the Borrower and its Subsidiaries, considered as an entirety, are
engaged on the Effective Date, and (B) involves a line or lines of
business which has generated a positive earnings before interest,
income taxes, depreciation and amortization for its most recently
completed four full fiscal quarters for which financial information
is available, UNLESS the Required Lenders specifically approve or
consent to such Acquisition in writing;

(ii) such Acquisition is not actively opposed by the Board
of Directors (or similar governing body) of the selling person or
the person whose equity interests are to be acquired, UNLESS all of
the Lenders specifically approve or consent to such Acquisition in
writing;

(iii) the Borrower would, after giving effect to such
Acquisition, be in compliance, on a PRO FORMA basis, with the
financial covenants contained in sections 9.7, 9.8, 9.9 and 9.10;

(iv) the cumulative aggregate consideration for such
Acquisition and all other Acquisitions completed during the
preceding 12 months, including the principal amount of any assumed
Indebtedness and (without duplication) any Indebtedness of any
acquired person or persons, but excluding the value of any
consideration for an Acquisition paid in the form of capital stock
of the Borrower which is not Redeemable Stock, does not exceed an
amount equal to 15% of the Borrower's Consolidated Net Worth as of
the end of the most recent fiscal period for which financial
statements have been delivered to the Lenders hereunder; and

(v) if the aggregate consideration for such Acquisition,
including the principal amount of any assumed Indebtedness and
(without duplication) any Indebtedness of any acquired person or
persons, exceeds $20,000,000, at least 10 Business Days prior to the
completion of such transaction the Borrower shall have delivered to
the Lenders a certificate of a responsible financial or accounting
officer of the Borrower demonstrating, in reasonable detail, the
computation of the ratios referred to in sections 9.7, 9.8, 9.9 and
9.10 on a PRO FORMA basis, such PRO FORMA ratios being determined as
if (x) such Acquisition had been completed at the beginning of the
most recent period of four consecutive fiscal quarters of the
Borrower for which financial information for the Borrower and the
business or person to be acquired, is available and has been
delivered to the Lenders at least 10 Business Days prior to the
completion of such transaction (which shall in the case of the
acquired business include audited financial statements for the most
recent fiscal year, unless the same are unavailable and unaudited
financial statements are acceptable to the Required Lenders), and
(y) any such Indebtedness, or other Indebtedness incurred to finance
such Acquisition, had been outstanding for such period;

PROVIDED, that the term Permitted Acquisition specifically excludes any loans,
advances or minority investments otherwise permitted pursuant to section 9.5.

"PERMITTED LIENS" shall mean Liens described in section 9.3.

"PERSON" shall mean any individual, partnership, joint venture, firm,
corporation, limited liability company, association, trust or other enterprise
or any government or political subdivision or any agency, department or
instrumentality thereof.

"PLAN" shall mean any multiemployer or single-employer plan as defined in
section 4001 of ERISA, which is maintained or contributed to by (or to which
there is an obligation to contribute by) the Borrower or a Subsidiary of the
Borrower or an ERISA Affiliate, and each such plan for the five year period
immediately following the latest date on which the Borrower, or a Subsidiary of
the Borrower or an ERISA Affiliate maintained, contributed to or had an
obligation to contribute to such plan.

"PRIME RATE" shall mean, for any period, a fluctuating interest rate per
annum as shall be in effect from time to time which rate per annum shall at all
times be equal to the rate of interest established by the Administrative Agent
at its principal office, from time to time, as its prime rate, whether or not
publicly announced, which interest rate may or may not be the lowest rate
charged by it for commercial loans or other extensions of credit.

"PRIME RATE BORROWING" shall mean a Borrowing consisting of Prime Rate
Loans.

"PRIME RATE LOAN" shall mean each Loan bearing interest at the rate
provided in section 2.6(a).

"PROHIBITED TRANSACTION" shall mean a transaction with respect to a Plan
that is prohibited under section 4975 of the Code or section 406 of ERISA and
not exempt under section 4975 of the Code or section 408 of ERISA.

"QUOTED RATE" shall have the meaning provided in section 2.3(c).

"REAL PROPERTY" of any person shall mean all of the right, title and
interest of such person in and to land, improvements and fixtures, including
Leaseholds.

"REDEEMABLE STOCK" shall mean with respect to any person any capital stock
or similar equity interests of such person that (i) is by its terms subject to
mandatory redemption, in whole or in part, pursuant to a sinking fund, scheduled
redemption or similar provisions, at any time prior to the Maturity Date; or
(ii) otherwise is required to be repurchased or retired on a scheduled date or
dates, upon the occurrence of any event or circumstance, at the option of the
holder or holders thereof, or otherwise, at any time prior to the Maturity Date,
other than any such repurchase or retirement occasioned by a "change of control"
or similar event.

"REFERENCE BANKS" shall mean (i) KeyBank, and (ii) any other Lender or
Lenders selected as a Reference Bank by the Administrative Agent and the
Required Lenders, PROVIDED, that if any of such Reference Banks is no longer a
Lender, such other Lender or Lenders as may be selected by the Administrative
Agent acting on instructions from the Required Lenders.

"REGULATION D" shall mean Regulation D of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor to all
or a portion thereof establishing reserve requirements.

"REGULATION U" shall mean Regulation U of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor to all
or a portion thereof establishing margin requirements.

"REPORTABLE EVENT" shall mean an event described in section 4043 of ERISA
or the regulations thereunder with respect to a Plan, other than those events as
to which the notice requirement is waived under subsections .22, .23, .25, .27,
.28, .29, .30, .31, .32, .34, .35, .62, .63, .64, .65 or .67 of PBGC Regulation
section 4043.

"REQUIRED LENDERS" shall mean Non-Defaulting Lenders whose outstanding
General Revolving Loans and Unutilized General Revolving Commitments constitute
more than 66+2/3% of the sum of the total outstanding General Revolving Loans
and Unutilized General Revolving Commitments of Non-Defaulting Lenders (PROVIDED
that, for purposes hereof, neither the Borrower, nor any of its Affiliates,
shall be included in (i) the Lenders holding such amount of the General
Revolving Loans or having such amount of the Unutilized General Revolving
Commitments, or (ii) determining the aggregate unpaid principal amount of the
General Revolving Loans or Unutilized General Revolving Commitments).

"SALE AND LEASE-BACK TRANSACTION" shall mean any arrangement with any
person providing for the leasing by the Borrower or any Subsidiary of the
Borrower of any property (except for temporary leases for a term, including any
renewal thereof, of not more than one year and except for leases between the
Borrower and a Subsidiary or between Subsidiaries), which property has been or
is to be sold or transferred by the Borrower or such Subsidiary to such person.

"S&P" shall mean Standard & Poor's Ratings Group, and its successors.

"SEC" shall mean the United States Securities and Exchange Commission.

"SEC REGULATION D" shall mean Regulation D as promulgated under the
Securities Act of 1933, as amended, as the same may be in effect from time to
time.

"SECTION 5.4(b)(ii) CERTIFICATE" shall have the meaning provided in section
5.4(b)(ii).

"STANDARD PERMITTED LIENS" shall mean the following:

(i) Liens for taxes not yet delinquent or Liens for taxes
being contested in good faith and by appropriate proceedings for
which adequate reserves (in the good faith judgment of the
management of the Borrower) have been established;

(ii) Liens in respect of property or assets imposed by law
which were incurred in the ordinary course of business, such as
carriers', warehousemen's, materialmen's and mechanics' Liens and
other similar Liens arising in the ordinary course of business,
which do not in the aggregate materially detract from the value of
such property or assets or materially impair the use thereof in the
operation of the business of the Borrower and its Subsidiaries
considered as an entirety;

(iii) Liens arising from judgments, decrees or attachments
in circumstances not constituting an Event of Default under section
10.1(g);

(iv) Liens (other than any Lien imposed by ERISA) incurred
or deposits made in the ordinary course of business in connection
with workers' compensation, unemployment insurance and other types
of social security; and mechanic's Liens, carrier's Liens, and other
Liens to secure the performance of tenders, statutory obligations,
contract bids, government contracts, performance and return-of-money
bonds and other similar obligations, incurred in the ordinary course
of business (exclusive of obligations in respect of the payment for
borrowed money), whether pursuant to statutory requirements, common
law or consensual arrangements;

(v) Leases or subleases granted to others not interfering in
any material respect with the business of the Borrower or any of its
Subsidiaries and any interest or title of a lessor under any lease
not in violation of this Agreement;

(vi) easements, rights-of-way, zoning or deed restrictions,
minor defects or irregularities in title and other similar charges
or encumbrances not interfering in any material respect with the
ordinary conduct of the business of the Borrower or any of its
Subsidiaries considered as an entirety; and

(vii) Liens on property subject to leases not in violation
of the requirements of this Agreement, PROVIDED that such Liens are
only in respect of the property subject to, and secure only, the
respective lease (and any other lease with the same or an affiliated
lessor).

"STANDBY LETTER OF CREDIT" shall have the meaning provided in section
3.1(a).

"STATED AMOUNT" of each Letter of Credit shall mean the maximum available
to be drawn thereunder, including any amounts which can be drawn under any
banker's acceptances or sight or time drafts which have or could be issued or
presented thereunder (regardless of whether any conditions or other requirements
for drawing could then be met).

"STATUTORY RESERVE RATE" means a fraction (expressed as a decimal), the
numerator of which is the number one and the denominator of which is the number
one minus the aggregate of the maximum reserve percentages (including any
marginal, special, emergency or supplemental reserves) expressed as a decimal
established by the Board to which the Administrative Agent is subject for
eurocurrency funding (currently referred to as "Eurocurrency Liabilities" in
Regulation D of the Federal Reserve Board). Such reserve percentages shall
include those imposed pursuant to such Regulation D. Eurodollar Loans shall be
deemed to constitute eurocurrency funding and to be subject to such reserve
requirements without benefit of or credit for proration, exemptions or offsets
that may be available from time to time to any Lender under such Regulation D or
any comparable regulation. The Statutory Reserve Rate shall be adjusted
automatically on and as of the effective date of any change in any reserve
percentage.

"SUBORDINATED INDEBTEDNESS" shall mean (i) the Subordinated Notes; and (ii)
any other Indebtedness which has been subordinated to the Obligations in such
manner and to such extent as the Administrative Agent (acting on instructions
from the Required Lenders) may require.

"SUBORDINATED NOTE INDENTURE" shall have the meaning provided in section
6.1(h).

"SUBORDINATED NOTES" shall have the meaning provided in section 6.1(h).

"SUBSIDIARY" of any person shall mean and include (i) any corporation more
than 50% of whose stock of any class or classes having by the terms thereof
ordinary voting power to elect a majority of the directors of such corporation
(irrespective of whether or not at the time stock of any class or classes of
such corporation shall have or might have voting power by reason of the
happening of any contingency) is at the time owned by such person directly or
indirectly through Subsidiaries and (ii) any partnership, association, joint
venture or other entity in which such person directly or indirectly through
Subsidiaries, has more than a 50% equity interest at the time. Unless otherwise
expressly provided, all references herein to "Subsidiary" shall mean a
Subsidiary of the Borrower.

"SUBSIDIARY GUARANTOR" shall mean any Subsidiary which is a party to the
Subsidiary Guaranty.

"SUBSIDIARY GUARANTY" shall have the meaning provided in section 6.1(c).

"SWING LINE COMMITMENT" shall mean, with respect to the Swing Line Lender,
the amount set forth opposite such Lender's name in Annex I as its "Swing Line
Commitment" as the same may be reduced from time to time pursuant to section
4.2, adjusted from time to time as a result of assignments to or from such
Lender pursuant to section 12.4(c), or terminated pursuant to section 4.2, 4.3
or 10.2.

"SWING LINE FACILITY" shall mean the credit facility evidenced by the Swing
Line Commitment.

"SWING LINE LENDER" shall mean the Lender which has the Swing Line
Commitment.

"SWING LINE LOAN" shall have the meaning provided in section 2.1(b).

"SWING LINE NOTE" shall have the meaning provided in section 2.4(a).

"SWING LINE PARTICIPATION AMOUNT" shall have the meaning provided in
section 2.3(b).

"SYNTHETIC LEASE" shall mean any lease (i) which is accounted for by the
lessee as an Operating Lease, and (ii) under which the lessee is intended to be
the "owner" of the leased property for Federal income tax purposes.

"TAXES" shall have the meaning provided in section 5.4.

"TESTING PERIOD" shall mean for any determination a single period
consisting of the four consecutive fiscal quarters of the Borrower then last
ended (whether or not such quarters are all within the same fiscal year), EXCEPT
that if a particular provision of this Agreement indicates that a Testing Period
shall be of a different specified duration, such Testing Period shall consist of
the particular fiscal quarter or quarters then last ended which are so indicated
in such provision.

"TOTAL COMMITMENT" shall mean the sum of all of the Commitments of all of
the Lenders hereunder.

"TOTAL GENERAL REVOLVING COMMITMENT" shall mean the sum of the General
Revolving Commitments of the Lenders.

"TOTAL GENERAL REVOLVING CREDIT EXPOSURE" shall mean at any time the sum at
such time of (i) the outstanding principal amount of the General Revolving
Loans; (ii) the Total LC Exposure; and (iii) the outstanding

principal amount of the Swing Line Loans which have been or could be, subject to
the terms and conditions of section 2.3, made the subject of a Swing Line
Refunding Notice.

"TOTAL LC EXPOSURE" shall mean, at any time, the sum, without duplication,
of (i) the aggregate Stated Amount of all outstanding Letters of Credit and (ii)
the aggregate amount of all LC Disbursements that have not yet been reimbursed
by or on behalf of the Borrower (and its Subsidiaries which are account parties)
at such time.

"TYPE" shall mean any type of Loan determined with respect to the interest
option applicable thereto, I.E., (i) in the case of General Revolving Loans, a
Prime Rate Loan or a Eurodollar Loan, and (ii) in the case of a Swing Line Loan,
a Prime Rate Loan or a Money Market Rate Loan.

"UCC" shall mean the Uniform Commercial Code.

"UNFUNDED CURRENT LIABILITY" of any Plan shall mean the amount, if any, by
which the actuarial present value of the accumulated plan benefits under the
Plan as of the close of its most recent plan year exceeds the fair market value
of the assets allocable thereto, each determined in accordance with Statement of
Financial Accounting Standards No. 87, based upon the actuarial assumptions used
by the Plan's actuary in the most recent annual valuation of the Plan.

"UNITED STATES" and "U.S." each means United States of America.

"UNUTILIZED GENERAL REVOLVING COMMITMENT" shall mean, at any time, for any
Lender with a General Revolving Commitment, the excess at such time of (i) such
Lender's General Revolving Commitment, OVER (ii) the sum of (x) the principal
amount of General Revolving Loans made by such Lender and outstanding at such
time, and (y) such Lender's General Revolving Facility Percentage of the Total
LC Exposure at such time.

"UNUTILIZED SWING LINE COMMITMENT" shall mean, at any time, the excess of
(i) the Swing Line Commitment at such time, OVER (ii) the aggregate principal
amount of all Swing Line Loans then outstanding.

"UNUTILIZED TOTAL GENERAL REVOLVING COMMITMENT" shall mean, at any time,
the excess at such time of (i) the Total General Revolving Commitment at such
time, OVER (ii) the sum of (x) the aggregate principal amount of all General
Revolving Loans then outstanding, and (y) the Total LC Exposure at such time.

"WHOLLY-OWNED SUBSIDIARY" shall mean each Subsidiary of the Borrower at
least 95% of whose capital stock, equity interests and partnership interests,
other than director's qualifying shares or similar interests, are owned directly
or indirectly by the Borrower.

"WRITTEN", "WRITTEN" or "IN WRITING" shall mean any form of written
communication or a communication by means of telex, facsimile transmission,
telegraph or cable.

1.2. COMPUTATION OF TIME PERIODS. In this Agreement in the computation of
periods of time from a specified date to a later specified date, the word "from"
means "from and including" and the words "to" and "until" each means "to but
excluding".

1.3. ACCOUNTING TERMS. Except as otherwise specifically provided herein,
all terms of an accounting or financial nature shall be construed in accordance
with GAAP, as in effect from time to time; PROVIDED that, if the Borrower
notifies the Administrative Agent that the Borrower requests an amendment to any
provision of section 8 or 9 hereof to eliminate the effect of any change
occurring after the Effective Date in GAAP or in the application thereof to such
provision (or if the Administrative Agent notifies the Borrower that the
Required Lenders request an amendment to any such provision hereof for such
purposes), regardless of whether any such notice is given before or after such
change in GAAP or in the application thereof, then such provision shall be
interpreted on the basis of GAAP as in effect and applied immediately before
such change shall have become effective until such notice shall have been
withdrawn or such provision amended in accordance with the requirements of this
Agreement.

1.4. TERMS GENERALLY. The definitions of terms herein shall apply equally
to the singular and plural forms of the terms defined. Whenever the context may
require, any pronoun shall include the corresponding masculine, feminine and
neuter forms. The words "include", "includes" and "including" shall be deemed to
be followed by the phrase "without limitation". The word "will" shall be
construed to have the same meaning and effect as the word "shall". Unless the
context requires otherwise, (a) any definition of or reference to any agreement,
instrument or other document herein shall be construed as referring to such
agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (b) any reference
herein to any person shall be construed to include such person's successors and
assigns, (c) the words "herein", "hereof" and "hereunder", and words of similar
import, shall be construed to refer to this Agreement in its entirety and not to
any particular provision hereof, (d) all references herein to sections, Annexes
and Exhibits shall be construed to refer to sections of, and Annexes and
Exhibits to, this Agreement, and (e) the words "asset" and "property" shall be
construed to have the same meaning and effect and to refer to any and all real
property, tangible and intangible assets and properties, including cash,
securities, accounts and contract rights, and interests in any of the foregoing.

1.5. CURRENCY EQUIVALENTS. For purposes of this Agreement, except as
otherwise specified herein, (i) the equivalent in Dollars of any Alternative
Currency shall be determined by using the quoted spot rate at which the
Administrative Agent offers to exchange Dollars for such Alternative Currency at
its Payment Office at 9:00 A.M. (local time at the Payment Office) two Business
Days prior to the date on which such equivalent is to be determined, and (ii)
the equivalent in any Alternative Currency of Dollars shall be determined by
using the quoted spot rate at which the Administrative Agent's Payment Office
offers to exchange such Alternative Currency for Dollars at the Payment Office
at 9:00 A.M. (local time at the Payment Office) two Business Days prior to the
date on which such equivalent is to be determined; PROVIDED, that (A) the
equivalent in Dollars of any LC Disbursement in respect of any Letter of Credit
denominated in an Alternative Currency shall be determined at the time the
drawing under such Letter of Credit was paid or disbursed by the applicable
Issuing Bank; (B) for purposes of sections 2.1, 3.1(b) and 5.2, the equivalent
in Dollars of the Stated Amount of any Letter of Credit denominated in an
Alternative Currency shall be calculated (x) on the date of the issuance of the
respective Letter of Credit, (y) on the first Business Day of each calendar
month thereafter and (z) in any other case where the same is required or
permitted to be calculated, on such other day as the Administrative Agent may,
in its sole discretion, consider appropriate; and (C) for purposes of sections
4.1(c) and (e), the equivalent in Dollars of the Stated Amount of any Letter of
Credit denominated in an Alternative Currency shall be calculated on the first
day of each calendar month in the quarterly period in which the respective
payment is due pursuant to said sections.

SECTION 2. AMOUNT AND TERMS OF LOANS.

2.1. COMMITMENTS FOR LOANS. Subject to and upon the terms and conditions
herein set forth, each Lender severally agrees to make a loan or loans (each a
"LOAN" and, collectively, the "LOANS") to the Borrower, which Loans shall be
drawn, to the extent a Lender has a commitment under a Facility for the
Borrower, under the applicable Facility, as set forth below:

(a) GENERAL REVOLVING FACILITY. Loans to the Borrower under the
General Revolving Facility (each a "GENERAL REVOLVING LOAN" and
collectively, the "GENERAL REVOLVING LOANS"): (i) may be incurred by the
Borrower at any time and from time to time on and after the Closing Date
and prior to the Maturity Date; (ii) except as otherwise provided, may, at
the option of the Borrower, be incurred and maintained as, or Converted
into, General Revolving Loans which are Prime Rate Loans or Eurodollar
Loans, in each case denominated in Dollars, PROVIDED that all General
Revolving Loans made as part of the same Borrowing shall, unless otherwise
specifically provided herein, consist of General Revolving Loans of the
same Type; (iii) may be repaid or prepaid and reborrowed in accordance with
the provisions hereof; (iv) may only be made if after giving effect thereto
the Unutilized Total General Revolving Commitment exceeds the outstanding
Swing Line Loans; and (v) in the case of any Lender with a General
Revolving Commitment, may not be incurred if after giving effect thereto
such Lender's General Revolving Credit Exposure would exceed its General
Revolving Commitment as then in effect.

(b) SWING LINE FACILITY. Loans to the Borrower under the Swing Line
Facility (each a "SWING LINE LOAN" and, collectively, the "SWING LINE
LOANS") (i) shall be made only by the Swing Line Lender, (ii) may be made
at any time and from time to time on and after the Closing Date and prior
to the Maturity Date; (iii) shall be made only in U.S. Dollars; (iv) shall
have a maturity of not more than 7 days; (v) shall be incurred only for
working capital requirements of the Borrower and its Subsidiaries; (vi) may
only be incurred as Prime Rate Loans or as Money Market Rate Loans; (vii)
may be repaid or prepaid and reborrowed in accordance with the provisions
hereof; (viii) may only be made if after giving effect thereto the
Unutilized Total General Revolving Commitment exceeds the outstanding Swing
Line Loans; and (ix) shall not exceed for the Swing Line Lender at any time
outstanding its Swing Line Commitment at such time.

2.2. PROCEDURES FOR BORROWING. (a) NOTICE OF BORROWING. Whenever the
Borrower desires to incur Loans, it shall give the Administrative Agent at its
Notice Office,

(A) EURODOLLAR BORROWINGS UNDER THE GENERAL REVOLVING FACILITY:
prior to 11:00 A.M. (local time at its Notice Office), at least three
Business Days' prior written or telephonic notice (in the case of
telephonic notice, promptly confirmed in writing if so requested by the
Administrative Agent) of each Eurodollar Borrowing to be made under the
General Revolving Facility,

(B) PRIME RATE BORROWINGS UNDER ANY FACILITY: prior to 12:00 noon
(local time at its Notice Office) on the proposed date thereof written or
telephonic notice (in the case of telephonic notice, promptly confirmed in
writing if so requested by the Administrative Agent) of each Prime Rate
Borrowing to be made hereunder; or

(C) BORROWINGS UNDER THE SWING LINE FACILITY OF MONEY MARKET RATE
LOANS: in the case of any Borrowing under the Swing Line Facility of a
Money Market Rate Loan to be made hereunder, if the Administrative Agent
shall have furnished the Borrower with a Quoted Rate therefor, prior to
11:00 A.M. (local time at its Notice Office) on the proposed date thereof
(which shall be within such period as the Administrative Agent shall have
specified for such Quoted Rate) written or telephonic notice thereof (in
the case of telephonic notice, promptly confirmed in writing if so
requested by the Administrative Agent).

Each such notice (each such notice, a "NOTICE OF BORROWING") shall (if requested
by the Administrative Agent to be confirmed in writing), be substantially in the
form of Exhibit B-1, and in any event shall be irrevocable and shall specify:
(i) the Facility under which the Borrowing is to be incurred, (ii) the aggregate
principal amount of the Loans to be made pursuant to such Borrowing; (iii) the
date of the Borrowing (which shall be a Business Day); (iv) whether the
Borrowing shall consist of Prime Rate Loans, Eurodollar Loans or Money Market
Rate Loans; (v) if the requested Borrowing consists of Eurodollar Loans, the
Interest Period to be initially applicable thereto; and (vi) if the Borrowing
consists of a Swing Line Loan, the maturity date thereof (which shall be not
more than 7 days), and if such Swing Line Loan is a Money Market Rate Loan, the
Quoted Rate therefor. If the Borrower fails to specify in a Notice of Borrowing
the maturity date of any Swing Line Loan, such maturity date shall be deemed to
be 7 days. The Administrative Agent shall promptly give each Lender which has a
Commitment under any applicable Facility written notice (or telephonic notice
promptly confirmed in writing) of each proposed Borrowing under the applicable
Facility, of such Lender's proportionate share thereof and of the other matters
covered by the Notice of Borrowing relating thereto.

(b) BORROWINGS OF MONEY MARKET RATE LOANS. Whenever the Borrower proposes
to submit a Notice of Borrowing with respect to a Swing Line Loan which will be
a Money Market Rate Loan, it will prior to submitting such Notice of Borrowing
notify the Administrative Agent of its intention and request the Administrative
Agent to quote a fixed or floating interest rate (the "QUOTED RATE") to be
applicable thereto prior to the proposed maturity thereof. The Administrative
Agent will immediately so notify the Swing Line Lender, and if the Swing Line
Lender is agreeable to a particular interest rate for the proposed maturity of
such Money Market Rate Loan if such Loan is made on or prior to a specified
date, the Administrative Agent shall quote such interest rate to the Borrower as
the Quoted Rate applicable to such proposed Money Market Rate Loan if made on or
before such specified date for a maturity as so proposed by the Borrower. The
Swing Line Lender contemplates that any Quoted Rate will be a rate

of interest which reflects a margin corresponding to the sum of (x) the
Applicable Eurodollar Margin in effect at the time of quotation of any Quoted
Rate, PLUS (y) the Applicable Facility Fee Rate in effect at such time, over the
then prevailing Federal Funds Effective Rate, commercial paper, call money,
overnite repurchase or other commonly quoted interest rate, or the Swing Line
Lender's average fully absorbed cost of short term funds, in each case as
selected and determined by the Swing Line Lender in its sole and absolute
discretion. Nothing herein shall be deemed to permit any Lender other than the
Swing Line Lender any right of approval with respect to a Quoted Rate.

(c) ACTIONS BY ADMINISTRATIVE AGENT ON TELEPHONE NOTICE. Without in any way
limiting the obligation of the Borrower to confirm in writing any telephonic
notice permitted to be given hereunder, the Administrative Agent may act prior
to receipt of written confirmation without liability upon the basis of such
telephonic notice believed by the Administrative Agent in good faith to be from
an Authorized Officer of the Borrower entitled to give telephonic notices under
this Agreement on behalf of the Borrower. In each such case, the Administrative
Agent's record of the terms of such telephonic notice shall be conclusive absent
manifest error.

(d) MINIMUM BORROWING AMOUNTS, ETC. The aggregate principal amount of each
Borrowing by the Borrower under a Facility shall not be less than the Minimum
Borrowing Amount for such Borrowing. More than one Borrowing may be incurred by
the Borrower on any day, PROVIDED that (i) if there are two or more Eurodollar
Borrowings on a single day by the Borrower under the General Revolving Facility,
each such Borrowing shall have a different initial Interest Period, (ii) at no
time shall there be more than 10 Eurodollar Borrowings outstanding hereunder
(including any such Borrowings resulting from the incurrence of General
Revolving Loans or Continuations or Conversions), and (iii) only one Borrowing
may be made on any day under the Swing Line Facility.

(e) PRO RATA BORROWINGS. All Borrowings of Loans under a Facility shall be
made by the Lenders having Commitments under such Facility PRO RATA on the basis
of their respective Commitments under such Facility. It is understood that no
Lender shall be responsible for any default by any other Lender in its
obligation to make Loans hereunder and that each Lender shall be obligated to
make the Loans provided to be made by it hereunder, regardless of the failure of
any other Lender to fulfill its Commitments hereunder.

(f) DISBURSEMENT OF FUNDS. (i) No later than 2:00 P.M. (local time at the
Payment Office) on the date specified in each Notice of Borrowing, each Lender
with a Commitment under the applicable Facility relating to the Borrowing
covered thereby will make available its PRO RATA share of each Borrowing
requested to be made on such date in the manner provided below. All amounts
shall be made available to the Administrative Agent in U.S. dollars and
immediately available funds at the Payment Office and the Administrative Agent
promptly will make available to the Borrower by depositing to its account at the
Payment Office the aggregate of the amounts so made available in the type of
funds received. Unless the Administrative Agent shall have been notified by any
Lender prior to the date of Borrowing that such Lender does not intend to make
available to the Administrative Agent its portion of the Borrowing or Borrowings
to be made on such date, the Administrative Agent may assume that such Lender
has made such amount available to the Administrative Agent on such date of
Borrowing, and the Administrative Agent, in reliance upon such assumption, may
(in its sole discretion and without any obligation to do so) make available to
the Borrower a corresponding amount. If such corresponding amount is not in fact
made available to the Administrative Agent by such Lender and the Administrative
Agent has made available same to the Borrower, the Administrative Agent shall be
entitled to recover such corresponding amount from such Lender. If such Lender
does not pay such corresponding amount forthwith upon the Administrative Agent's
demand therefor, the Administrative Agent shall promptly notify the Borrower,
and the Borrower shall immediately pay such corresponding amount to the
Administrative Agent. The Administrative Agent shall also be entitled to recover
from such Lender or the Borrower, as the case may be, interest on such
corresponding amount in respect of each day from the date such corresponding
amount was made available by the Administrative Agent to the Borrower to the
date such corresponding amount is recovered by the Administrative Agent, at a
rate per annum equal to (x) if paid by such Lender, the overnight Federal Funds
Effective Rate or (y) if paid by the Borrower, the then applicablE rate of
interest, calculated in accordance with section 2.6, for the respective Loans
(but without any requirement to pay any amounts in respect thereof pursuant to
section 2.9).

(ii) Nothing herein and no subsequent termination of the Commitments
pursuant to section 4.2 or 4.3 shall be deemed to relieve any Lender from its
obligation to fulfill its Commitments hereunder and in existence from time to
time or to prejudice any rights which the Borrower may have against any Lender
as a result of any default by such Lender hereunder.

2.3. REFUNDING OF, OR PARTICIPATION IN, SWING LINE LOANS. (a) If any Event
of Default exists, the Swing Line Lender may, in its sole and absolute
discretion, direct that the Swing Line Loans owing to it be refunded by
delivering a notice to such effect to the Administrative Agent, specifying the
aggregate principal amount thereof (a "NOTICE OF SWING LINE REFUNDING").
Promptly upon receipt of a Notice of Swing Line Refunding, the Administrative
Agent shall give notice of the contents thereof to the Lenders with General
Revolving Commitments and, unless an Event of Default specified in section
10.1(h) in respect of the Borrower has occurred, also to the Borrower. Each such
Notice of Swing Line Refunding shall be deemed to constitute delivery by the
Borrower of a Notice of Borrowing requesting General Revolving Loans consisting
of Prime Rate Loans in the amount of the Swing Line Loans to which it relates.
Each Lender with a General Revolving Commitment (including the Swing Line
Lender, in its capacity as a Lender) hereby unconditionally agrees
(notwithstanding that any of the conditions specified in section 6.2 hereof or
elsewhere in this Agreement shall not have been satisfied, but subject to the
provisions of paragraph sections 2.3(b) and (d) below) to make a General
Revolving Loan to the Borrower in an amount equal to such Lender's General
Revolving Facility Percentage of the aggregate amount of the Swing Line Loans to
which such Notice of Swing Line Refunding relates. Each such Lender shall make
the amount of such General Revolving Loan available to the Administrative Agent
in immediately available funds at the Payment Office not later than 2:00 P.M.
(local time at the Payment Office), if such notice is received by such Lender
prior to 11:00 A.M. (local time at its Domestic Lending Office), or not later
than 2:00 P.M. (local time at the Payment Office) on the next Business Day, if
such notice is received by such Lender after such time. The proceeds of such
General Revolving Loans shall be made immediately available to the Swing Line
Lender and applied by it to repay the principal amount of the Swing Line Loans
to which such Notice of Swing Line Refunding related. The Borrower irrevocably
and unconditionally agrees that, notwithstanding anything to the contrary
contained in this Agreement, General Revolving Loans made as herein provided in
response to a Notice of Swing Lne Refunding shall constitute General Revolving
Loans hereunder consisting of Prime Rate Loans.

(b) If prior to the time a General Revolving Loan would otherwise have been
made as provided above as a consequence of a Notice of Swing Line Refunding, any
of the events specified in section 10.1(h) shall have occurred in respect of the
Borrower or one or more of the Lenders with General Revolving Commitments shall
determine that it is legally prohibited from making a General Revolving Loan
under such circumstances, each Lender (other than the Swing Line Lender), or
each Lender (other than the Swing Line Lender) so prohibited, as the case may
be, shall, on the date such General Revolving Loan would have been made by it
(the "PURCHASE DATE"), purchase an undivided participating interest in the
outstanding Swing Line Loans to which such Notice of Swing Line Refunding
related, in an amount (the "SWING LINE PARTICIPATION AMOUNT") equal to such
Lender's General Revolving Facility Percentage of such Swing Line Loans. On the
Purchase Date, each such Lender or each such Lender so prohibited, as the case
may be, shall pay to the Swing Line Lender, in immediately available funds, such
Lender's Swing Line Participation Amount, and promptly upon receipt thereof the
Swing Line Lender shall, if requested by such other Lender, deliver to such
Lender a participation certificate, dated the date of the Swing Line Lender's
receipt of the funds from, and evidencing such Lender's participating interest
in such Swing Line Loans and its Swing Line Participation Amount in respect
thereof. If any amount required to be paid by a Lender to the Swing Line Lender
pursuant to the above provisions in respect of any Swing Line Participation
Amount is not paid on the date such payment is due, such Lender shall pay to the
Swing Line Lender on demand interest on the amount not so paid at the overnight
Federal Funds Effective Rate from the due date until such amount is paid in
full.

(c) Whenever, at any time after the Swing Line Lender has received from any
other Lender such Lender's Swing Line Participation Amount, the Swing Line
Lender receives any payment from or on behalf of the Borrower on account of the
related Swing Line Loans, the Swing Line Lender will promptly distribute to such
Lender its General Revolving Facility Percentage of such payment on account of
its Swing Line Participation Amount (appropriately adjusted, in the case of
interest payments, to reflect the period of time during which such Lender's
participating interest was outstanding and funded); PROVIDED, HOWEVER, that in
the event such payment received by the

Swing Line Lender is required to be returned, such Lender will return to the
Swing Line Lender any portion thereof previously distributed to it by the Swing
Line Lender.

(d) Each Lender's obligation to make General Revolving Loans and/or to
purchase participations in connection with a Notice of Swing Line Refunding
(which shall in all events be within such Lender's Unutilized General Revolving
Commitment, taking into account all outstanding participations in connection
with Swing Line Refundings) shall be subject to the conditions that:

(i) such Lender shall have received a Notice of Swing Line Refunding
complying with the provisions hereof, and

(ii) at the time the Swing Line Loans which are the subject of such
Notice of Swing Line Refunding were made, the Swing Line Lender had (x) no
knowledge that any Default under section 10.1(a) involving the payment of
principal of or interest on any of the Loans had occurred and was
continuing, and (y) no actual written notice from another Lender that an
Event of Default had occurred and was continuing,

but otherwise shall be absolute and unconditional, shall be solely for the
benefit of the Swing Line Lender, and shall not be affected by any circumstance,
including, without limitation, (A) any set-off, counterclaim, recoupment,
defense or other right which such Lender may have against any other Lender, any
Credit Party, or any other person, or any Credit Party may have against any
Lender or other person, as the case may be, for any reason whatsoever; (B) the
occurrence or continuance of a Default or Event of Default; (C) any event or
circumstance involving a Material Adverse Effect upon the Borrower; (D) any
breach of any Credit Document by any party thereto; or (E) any other
circumstance, happening or event, whether or not similar to any of the
foregoing.

2.4. NOTES; LOAN ACCOUNTS. (a) NOTES. The Borrower's obligation to pay the
principal of, and interest on, the General Revolving Loans made to it by each
Lender with a General Revolving Commitment shall be evidenced by a promissory
note of the Borrower substantially in the form of Exhibit A-1 (each a "GENERAL
REVOLVING NOTE" and, collectively, the "GENERAL REVOLVING NOTES"). The
Borrower's obligation to pay the principal of, and interest on, the Swing Line
Loans made to it by the Swing Line Lender shall be evidenced by a promissory
note of the Borrower substantially in the form of Exhibit A-2 with blanks
appropriately completed in conformity herewith (the "SWING LINE NOTE").

(b) GENERAL REVOLVING NOTES. The General Revolving Note issued by the
Borrower to a Lender with a General Revolving Commitment shall: (i) be executed
by the Borrower; (ii) be payable to the order of such Lender and be dated on or
prior to the Closing Date (or if later, the date the of the first General
Revolving Loan which is outstanding thereunder); (iii) be in a stated principal
amount equal to the General Revolving Commitment of such Lender; (iv) be payable
in the principal amount of the General Revolving Loans evidenced thereby; (v)
mature on the Maturity Date; (vi) bear interest as provided in section 2.6 in
respect of the Prime Rate Loans or Eurodollar Loans, as the case may be,
evidenced thereby; (vii) be subject to mandatory prepayment as provided in
section 5.2; and (viii) be entitled to the benefits of this Agreement and the
other Credit Documents.

(c) SWING LINE NOTE. The Swing Line Note issued by the Borrower to the
Swing Line Lender shall: (i) be executed by the Borrower; (ii) be payable to the
order of the Swing Line Lender and be dated on or prior to the date of any Swing
Line Loan evidenced thereby; (iii) be in a stated principal amount equal to the
Swing Line Commitment of the Swing Line Lender; (iv) be payable in the principal
amount of Swing Line Loans evidenced thereby; (v) mature as to any Swing Line
Loan evidenced thereby on the maturity date specified in the applicable Notice
of Borrowing (which shall be not more than 7 days following the date such Swing
Line Loan was made); (vi) bear interest as provided in section 2.6 in respect of
the Prime Rate Loans or Money Market Rate Loans, as the case may be, evidenced
thereby; (vii) be subject to mandatory prepayment as provided in section 5.2;
and (viii) be entitled to the benefits of this Agreement and the other Credit
Documents.

(d) LOAN ACCOUNTS OF LENDERS. Each Lender shall maintain in accordance with
its usual practice an account or accounts evidencing the indebtedness of the
Borrower to such Lender resulting from each Loan made by

such Lender, including the amounts of principal and interest payable and paid to
such Lender from time to time hereunder.

(e) LOAN ACCOUNTS OF ADMINISTRATIVE AGENT. The Administrative Agent shall
maintain accounts in which it shall record (i) the amount of each Loan made
hereunder, the Type thereof, the particular Facility under which such Loan was
made, and (to the extent applicable) the Interest Period if such Loan is a
Eurodollar Loan, or the Quoted Rate and maturity thereof if such Loan is a Money
Market Rate Loan, (ii) the amount of any principal due and payable or to become
due and payable from the Borrower to each Lender hereunder, and (iii) the amount
of any sum received by the Administrative Agent hereunder for the account of the
Lenders and each Lender's share thereof.

(f) EFFECT OF LOAN ACCOUNTS, ETC. The entries made in the accounts
maintained pursuant to section 2.4(d) and (e) shall be PRIMA FACIE evidence of
the existence and amounts and amounts of the obligations recorded therein;
PROVIDED, that the failure of any Lender or the Administrative Agent to maintain
such accounts or any error therein shall not in any manner affect the obligation
of the Borrower to repay or prepay the Loans in accordance with the terms of
this Agreement.

(g) ENDORSEMENTS OF AMOUNTS ON NOTES PRIOR TO TRANSFER. Each Lender will,
prior to any transfer of any Note issued to it by the Borrower, endorse on the
reverse side thereof or the grid attached thereto the outstanding principal
amount of Loans evidenced thereby. Failure to make any such notation or any
error in any such notation shall not affect the Borrower's obligations in
respect of such Loans.

2.5. CONVERSIONS OF BORROWINGS UNDER THE GENERAL REVOLVING FACILITY. The
Borrower shall have the option to Convert on any Business Day all or a portion
at least equal to the applicable Minimum Borrowing Amount of the outstanding
principal amount of a Borrowing under the General Revolving Facility into a
Borrowing or Borrowings under the same Facility of another Type of Loans which
can be made hereunder, PROVIDED that:

(a) no partial Conversion of a Eurodollar Borrowing shall reduce the
outstanding principal amount of the Eurodollar Loans made pursuant to such
Borrowing to less than the Minimum Borrowing Amount applicable thereto;

(b) any Conversion of a Eurodollar Borrowing into a Prime Rate
Borrowing shall be made on, and only on, the last day of an Interest Period
for such Eurodollar Borrowing;

(c) a Prime Rate Borrowing may only be Converted into a Eurodollar
Borrowing if no Default under section 10.1(a) or Event of Default is in
existence on the date of the Conversion unless the Required Lenders
otherwise agree; and

(d) Eurodollar Borrowings resulting from this section 2.6 shall
conform to the requirements of section 2.2(d).

Each such Conversion shall be effected by the Borrower giving the Administrative
Agent, at its Notice Office, prior written notice (or telephonic notice promptly
confirmed in writing if so requested by the Administrative Agent) (each a
"NOTICE OF CONVERSION"), substantially in the form of Exhibit B-2, specifying
the Loans to be so Converted, the Type of Loans to be Converted into and, if to
be Converted into a Borrowing of Eurodollar Loans, the Interest Period to be
initially applicable thereto. Any Notice of Conversion must be received by the
Administrative Agent (x) prior to 11:00 A.M. (local time at its Notice Office),
at least three Business Days prior to the date of any proposed Conversion into
Eurodollar Loans, or (y) prior to 11:00 A.M. (local time at its Notice Office)
on the same Business Day as the proposed Conversion into Prime Rate Loans. The
Administrative Agent shall give each Lender prompt notice of any such proposed
Conversion affecting any of its Loans. For the avoidance of doubt, the
prepayment or repayment of any Loans out of the proceeds of other Loans by the
Borrower is not considered a Conversion of Loans into other Loans.

2.6. INTEREST. (a) INTEREST RATE FOR PRIME RATE LOANS. During such periods
as a General Revolving Loan or a Swing Line Loan is a Prime Rate Loan, the
unpaid principal amount thereof shall bear interest at a fluctuating rate per
annum which shall at all times be equal to the Prime Rate in effect from time to
time.

(b) INTEREST RATE FOR EURODOLLAR LOANS. During such periods as a General
Revolving Loan is a Eurodollar Loan, the unpaid principal amount thereof shall
bear interest at a rate per annum which shall at all times during any Interest
Period applicable thereto be the Applicable Eurodollar Margin (as defined below)
for such Eurodollar Loan PLUS the relevant Adjusted LIBO Rate for such Interest
Period.

(c) INTEREST RATE FOR MONEY MARKET RATE LOANS. During such periods as a
Swing Line Loan is a Money Market Rate Loan, the unpaid principal amount thereof
shall bear interest at a the Quoted Rate therefor.

(d) DEFAULT INTEREST. Notwithstanding the above provisions, if a Default
under section 10.1(a) or Event of Default is in existence, all outstanding
amounts of principal in respect of each and every Loan shall bear interest,
payable on demand, at 2% per annum above the interest rate otherwise applicable
thereto. If any amount (other than the principal of the Loans) payable by the
Borrower under the Credit Documents is not paid when due, such amount shall bear
interest, payable on demand, at a fluctuating rate per annum equal 2% per annum
above the Prime Rate in effect from time to time.

(e) ACCRUAL AND PAYMENT OF INTEREST. Interest shall accrue from and
including the date of any Borrowing to but excluding the date of any prepayment
or repayment thereof and shall be payable:

(i) in the case of any Swing Line Loan, (A) at the maturity date
thereof, which shall in any event be not more than 7 days following the
date such Swing Line Loan is made, (B) on any prepayment (on the amount
prepaid), and (C) after maturity (whether by acceleration or otherwise), on
demand; and

(ii) in the case of any General Revolving Loan, (A) which is a Prime
Rate Loan, quarterly in arrears on the last Business Day of each April,
July, October and January, (B) which is a Eurodollar Loan, on the last day
of each Interest Period applicable thereto and, in the case of an Interest
Period in excess of three months, on the dates which are successively three
months after the commencement of such Interest Period, and (C) on any
repayment, prepayment or Conversion (on the amount repaid, prepaid or
Converted), at maturity (whether by acceleration or otherwise) and, after
such maturity, on demand.

(f) COMPUTATIONS OF INTEREST. All computations of interest hereunder shall
be made in accordance with section 12.7(b).

(g) INFORMATION AS TO INTEREST RATES. If requested to do so by the
Administrative Agent as contemplated by the definition of the term "LIBO Rate",
each Reference Bank agrees to furnish the Administrative Agent timely
information for the purpose of determining the Adjusted LIBO Rate for any
Eurodollar Borrowing. If any one or more of the Reference Banks shall not timely
furnish such information, the Administrative Agent shall determine the Adjusted
LIBO Rate on the basis of timely information furnished by the remaining
Reference Banks. The Administrative Agent upon determining the interest rate for
any Borrowing shall promptly notify the Borrower (on behalf of any applicable
Borrower) and the Lenders thereof.

(h) APPLICABLE EURODOLLAR MARGIN. As used herein, the term "APPLICABLE
EURODOLLAR MARGIN", as applied to any General Revolving Loan which is a
Eurodollar Loan, means the particular rate per annum determined by the
Administrative Agent in accordance with the Pricing Grid Table which appears
below, based on the Borrower's Fixed Charge Coverage Ratio and such Pricing Grid
Table, and the following provisions:

(i) Initially, until changed hereunder in accordance with the
following provisions, the Applicable Eurodollar Margin will be 110 basis
points per annum.

(ii) Commencing with the fiscal quarter of the Borrower ended on or
nearest to January 31, 2000, and continuing with each fiscal quarter
thereafter, the Administrative Agent will determine the Applicable
Eurodollar Margin for any Eurodollar Loan in accordance with the Pricing
Grid Table, based on the Borrower's Fixed Charge Coverage Ratio for the
Testing Period ended on the last day of the fiscal quarter, and identified
in such Pricing Grid Table. Changes in the Applicable Eurodollar Margin
based upon changes in such Fixed Charge Coverage Ratio shall become
effective on the first day of the month following the receipt by the
Administrative Agent pursuant to section 8.1(a) or (b) of the financial
statements of the Borrower, accompanied by the certificate and calculations
referred to in section 8.1(c), demonstrating the computation of such Fixed
Charge Coverage Ratio, based upon the Fixed Charge Coverage Ratio in effect
at the end of the applicable period covered (in whole or in part) by such
financial statements.

(iii) Notwithstanding the above provisions, during any period when
(A) the Borrower has failed to timely deliver its consolidated financial
statements referred to in section 8.1(a) or (b), accompanied by the
certificate and calculations referred to in section 8.1(c), (B) a Default
under section 10.1(a) has occurred and is continuing, or (C) an Event of
Default has occurred and is continuing, the Applicable Eurodollar Margin
shall be the highest rate per annum indicated therefor in the Pricing Grid
Table, regardless of the Borrower's Fixed Charge Coverage Ratio at such
time.

(iv) Any changes in the Applicable Eurodollar Margin shall be
determined by the Administrative Agent in accordance with the above
provisions and the Administrative Agent will promptly provide notice of
such determinations to the Borrower and the Lenders. Any such determination
by the Administrative Agent pursuant to this section 2.6(g) shall be
conclusive and binding absent manifest error.

PRICING GRID TABLE
(EXPRESSED IN BASIS POINTS)

-------------------------------------------------------------------------------
FIXED CHARGE COVERAGE RATIO APPLICABLE APPLICABLE FACILITY
EURODOLLAR FEE RATE
MARGIN
-------------------------------------------------------------------------------

Greater than 2.00 to 1.00 75.00 25.00
-------------------------------------------------------------------------------
Equal to or greater than 1.85 80.00 32.50
to 1.00 and equal to or less
than 2.00 to 1.00
-------------------------------------------------------------------------------
Equal to or greater than 1.75 to 100.00 37.50
1.00 and less than 1.85 to 1.00
-------------------------------------------------------------------------------
Equal to or greater than 110.00 40.00
1.625 to 1.00 and less than
1.75 to 1.00
-------------------------------------------------------------------------------
Less than 1.625 to 1.00 120.00 42.50
-------------------------------------------------------------------------------

2.7. SELECTION AND CONTINUATION OF INTEREST PERIODS. (a) The Borrower
shall have the right

(x) at the time it gives a Notice of Borrowing or Notice of
Conversion in respect of the making of or Conversion into a Eurodollar
Borrowing, to select in such Notice the Interest Period to be applicable to
such Eurodollar Borrowing, and

(y) prior to 11:00 A.M. (local time at the Notice Office) on the
third Business Day prior to the expiration of an Interest Period applicable
to a Eurodollar Borrowing, to elect by giving the Administrative Agent
written or telephonic notice (in the case of telephonic notice, promptly
confirmed in writing if so requested by the Administrative Agent) to
Continue all or the Minimum Borrowing Amount of the principal amount of
such Eurodollar Borrowing as one or more Eurodollar Borrowings and to
select the Interest Period to be applicable to any such Eurodollar
Borrowing (any such notice, a "NOTICE OF CONTINUATION"),

which Interest Period shall, at the option of the Borrower, be a one, two, three
or six month period; PROVIDED, that notwithstanding anything to the contrary
contained above, the Borrower's right to select an Interest Period or to effect
any Continuation shall be subject to the applicable provisions of section 2.8
and to the following:

(i) the initial Interest Period for any Eurodollar Borrowing shall
commence on the date of such Borrowing (the date of a Borrowing resulting
from a Conversion or Continuation shall be the date of such Conversion or
Continuation) and each Interest Period occurring thereafter in respect of
such Borrowing shall commence on the day on which the next preceding
Interest Period expires;

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

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

(iv) no Interest Period for any Eurodollar Borrowing may be selected
which would end after the Maturity Date;

(v) each Eurodollar Borrowing resulting from any Continuation shall
be in at least the Minimum Borrowing Amount applicable thereto; and

(vi) no Interest Period may be elected at any time when a Default
under section 10.1(a) or an Event of Default is then in existence unless
the Required Lenders otherwise agree.

(b) If upon the expiration of any Interest Period the Borrower has failed
to (or may not) elect a new Interest Period to be applicable to the respective
Eurodollar Borrowing as provided above, the Borrower shall be deemed to have
elected to Convert such Borrowing to a Prime Rate Borrowing effective as of the
expiration date of such current Interest Period.

2.8. INCREASED COSTS, ILLEGALITY, ETC. (a) In the event that (x) in the
case of clause (i) below, the Administrative Agent or (y) in the case of clauses
(ii) and (iii) below, any Lender, shall have determined on a reasonable basis
(which determination shall, absent manifest error, be final and conclusive and
binding upon all parties hereto):

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

(ii) at any time, that such Lender shall incur increased costs or
reductions in the amounts received or receivable hereunder in an amount
which such Lender deems material with respect to any Eurodollar Loans
(other than any increased cost or reduction in the amount received or
receivable resulting

from the imposition of or a change in the rate of taxes or similar charges)
because of (x) any change since the Effective Date in any applicable law,
governmental rule, regulation, guideline, order or request (whether or not
having the force of law), or in the interpretation or administration
thereof and including the introduction of any new law or governmental rule,
regulation, guideline, order or request (such as, for example, but not
limited to, a change in official reserve requirements, but, in all events,
excluding reserves includable in the Adjusted LIBO Rate pursuant to the
definition thereof) and/or (y) other circumstances adversely affecting the
interbank Eurodollar market or the position of such Lender in such market;
or

(iii) at any time, that the making or continuance of any Eurodollar
Loan has become unlawful by compliance by such Lender in good faith with
any change since the Effective Date in any law, governmental rule,
regulation, guideline or order, or the interpretation or application
thereof, or would conflict with any thereof not having the force of law but
with which such Lender customarily complies or has become impracticable as
a result of a contingency occurring after the Effective Date which
materially adversely affects the interbank Eurodollar market;

THEN, and in any such event, such Lender (or the Administrative Agent in the
case of clause (i) above) shall (x) on or promptly following such date or time
and (y) within 10 Business Days of the date on which such event no longer exists
give notice (by telephone confirmed in writing) to the Borrower and to the
Administrative Agent of such determination (which notice the Administrative
Agent shall promptly transmit to each of the other Lenders). Thereafter (x) in
the case of clause (i) above, Eurodollar Loans shall no longer be available
until such time as the Administrative Agent notifies the Borrower and the
Lenders that the circumstances giving rise to such notice by the Administrative
Agent no longer exist, and any Notice of Borrowing or Notice of Conversion given
by the Borrower with respect to Eurodollar Loans which have not yet been
incurred or Converted shall be deemed rescinded by the Borrower or, in the case
of a Notice of Borrowing, shall, at the option of the Borrower, be deemed
converted into a Notice of Borrowing for Prime Rate Loans to be made on the date
of Borrowing contained in such Notice of Borrowing, (y) in the case of clause
(ii) above, the Borrower shall pay to such Lender, upon written demand therefor,
such additional amounts (in the form of an increased rate of, or a different
method of calculating, interest or otherwise as such Lender shall determine) as
shall be required to compensate such Lender, for such increased costs or
reductions in amounts receivable hereunder (a written notice as to the
additional amounts owed to such Lender, showing the basis for the calculation
thereof, which basis must be reasonable, submitted to the Borrower by such
Lender shall, absent manifest error, be final and conclusive and binding upon
all parties hereto) and (z) in the case of clause (iii) above, the Borrower
shall take one of the actions specified in section 2.8(b) as promptly as
possible and, in any event, within the time period required by law.

(b) At any time that any Eurodollar Loan is affected by the circumstances
described in section 2.8(a)(ii) or (iii), the Borrower may (and in the case of a
Eurodollar Loan affected pursuant to section 2.8(a)(iii) the Borrower shall)
either (i) if the affected Eurodollar Loan is then being made pursuant to a
Borrowing, by giving the Administrative Agent telephonic notice (confirmed
promptly in writing) thereof on the same date that the Borrower was notified by
a Lender pursuant to section 2.8(a)(ii) or (iii), cancel said Borrowing, convert
the related Notice of Borrowing into one requesting a Borrowing of Prime Rate
Loans or require the affected Lender to make its requested Loan as a Prime Rate
Loan, or (ii) if the affected Eurodollar Loan is then outstanding, upon at least
one Business Day's notice to the Administrative Agent, require the affected
Lender to Convert each such Eurodollar Loan into a Prime Rate Loan, PROVIDED
that if more than one Lender is affected at any time, then all affected Lenders
must be treated the same pursuant to this section 2.8(b).

(c) If any Lender shall have determined that after the Effective Date, the
adoption of any applicable law, rule or regulation regarding capital adequacy,
or any change therein, or any change in the interpretation or administration
thereof by any governmental authority, central bank or comparable agency charged
by law with the interpretation or administration thereof, or compliance by such
Lender or its parent corporation with any request or directive regarding capital
adequacy (whether or not having the force of law) of any such authority, central
bank, or comparable agency, in each case made subsequent to the Effective Date,
has or would have the effect of reducing by an amount reasonably deemed by such
Lender to be material the rate of return on such Lender's or its parent
corporation's capital or assets as a consequence of such Lender's commitments or
obligations hereunder to a level

below that which such Lender or its parent corporation could have achieved but
for such adoption, effectiveness, change or compliance (taking into
consideration such Lender's or its parent corporation's policies with respect to
capital adequacy), then from time to time, within 15 days after demand by such
Lender (with a copy to the Administrative Agent), the Borrower shall pay to such
Lender such additional amount or amounts as will compensate such Lender or its
parent corporation for such reduction. Each Lender, upon determining in good
faith that any additional amounts will be payable pursuant to this section
2.8(c), will give prompt written notice thereof to the Borrower, which notice
shall set forth, in reasonable detail, the basis of the calculation of such
additional amounts, which basis must be reasonable, although the failure to give
any such notice shall not release or diminish any of the Borrower's obligations
to pay additional amounts pursuant to this section 2.8(c) upon the subsequent
receipt of such notice.

(d) Notwithstanding anything in this Agreement to the contrary, (i) no
Lender shall be entitled to compensation or payment or reimbursement of other
amounts under section 2.8 or 3.5 for any amounts incurred or accruing more than
180 days prior to the giving of notice to the Borrower of additional costs or
other amounts of the nature described in such sections, and (ii) no Lender shall
demand compensation for any reduction referred to in section 2.8(c) or payment
or reimbursement of other amounts under section 3.5 if it shall not at the time
be the general policy or practice of such Lender to demand such compensation,
payment or reimbursement in similar circumstances under comparable provisions of
other credit agreements.

2.9. BREAKAGE COMPENSATION. The Borrower shall compensate each applicable
Lender, upon its written request (which request shall set forth the detailed
basis for requesting and the method of calculating such compensation), for all
reasonable losses, costs, expenses and liabilities (including, without
limitation, any loss, cost, expense or liability incurred by reason of the
liquidation or reemployment of deposits or other funds required by such Lender
to fund its Eurodollar Loans or Swing Line Loans) which such Lender may sustain:
(i) if for any reason (other than a default by such Lender or the Administrative
Agent), (x) a Borrowing of Eurodollar Loans does not occur on a date specified
therefor in a Notice of Borrowing, Notice of Conversion or Notice of
Continuation (whether or not withdrawn, rescinded or cancelled by the Borrower
or deemed to be withdrawn, rescinded or cancelled), or (y)a Borrowing of a Swing
Line Loan does not occur on a date specified therefor in a Notice of Borrowing
(whether or not withdrawn, rescinded or cancelled by the Borrower or deemed to
be withdrawn, rescinded or cancelled); (ii) if any repayment, prepayment or
Conversion of any of its Eurodollar Loans occurs on a date which is not the last
day of an Interest Period applicable thereto; (iii) if any repayment or
prepayment of any of its Swing Line Loans occurs on a date which is not the
maturity date thereof; (iv) if any prepayment of any of its Eurodollar Loans or
Swing Line Loans not made on any date specified in a notice of prepayment given
by the Borrower; (v) as a result of an assignment by a Lender of any Eurodollar
Loan other than on the last day of the Interest Period applicable thereto, or
any Swing Line Loan other than on the maturity date thereof, pursuant to a
request by the Borrower pursuant to section 2.10(b); or (vi) as a consequence of
(x) any other default by the Borrower to repay or prepay its Eurodollar Loans
and/or Swing Line Loans when required by the terms of this Agreement or (y) an
election made pursuant to section 2.8(b). Such loss, cst, expense and liability
to any Lender shall be deemed to include an amount determined by such Lender to
be the excess, if any, of (i) the amount of interest which would have accrued on
the principal amount of such Loan had such event not occurred, at the interest
rate that would have been applicable to such Loan, for the period from the date
of such event to the last day of the then current Interest Period therefor, or
the maturity date thereof in the case of a Swing Line Loan, or in the case of a
failure to effect a Borrowing, Conversion or Continuation, for the period that
would have been the Interest Period for such Loan or the life of such Loan in
the case of a Swing Line Loan, over (ii) the amount of interest which would
accrue on such principal amount for such period at the interest rate which such
Lender would bid were it to bid, at the commencement of such period, for dollar
deposits of a comparable amount and period from other banks in the eurodollar
market (or the short term funds market, in the case of a Swing Line Loan). A
certificate of any Lender setting forth any amount or amounts that such Lender
is entitled to receive pursuant to this section shall be delivered to the
Borrower and shall be conclusive absent manifest error. The Borrower shall pay
such Lender the amount shown as due on any such request within 10 days after
receipt thereof.

2.10. CHANGE OF LENDING OFFICE; REPLACEMENT OF LENDERS. (a) Each Lender
agrees that, upon the occurrence of any event giving rise to the operation of
section 2.8(a)(ii) or (iii), 2.8(c) or 3.5 with respect to such

Lender, it will, if requested by the Borrower, use reasonable efforts (subject
to overall policy considerations of such Lender) to designate another Applicable
Lending Office for any Loans or Commitment affected by such event, PROVIDED that
such designation is made on such terms that such Lender and its Applicable
Lending Office suffer no economic, legal or regulatory disadvantage, with the
object of avoiding the consequence of the event giving rise to the operation of
any such section.

(b) If any Lender requests any compensation, reimbursement or other payment
under section 2.8(a)(ii) or (iii), 2.8(c) or 3.5 with respect to such Lender, or
if any Lender is a Defaulting Lender, then the Borrower may, at its sole expense
and effort, upon notice to such Lender and the Administrative Agent, require
such Lender to assign and delegate, without recourse (in accordance with the
restrictions contained in section 12.4(b)), all its interests, rights and
obligations under this Agreement to an assignee that shall assume such
obligations (which assignee may be another Lender, if a Lender accepts such
assignment); PROVIDED that (i) the Borrower shall have received the prior
written consent of the Administrative Agent, which consent shall not be
unreasonably withheld or delayed, (ii) such Lender shall have received payment
of an amount equal to the outstanding principal of its Loans, accrued interest
thereon, accrued fees and all other amounts payable to it hereunder, from the
assignee (to the extent of such outstanding principal and accrued interest and
fees) or the Borrower (in the case of all other amounts), and (iii) in the case
of any such assignment resulting from a claim for compensation, reimbursement or
other payments required to be made under section 2.8(a)(ii) or (iii), 2.8(c) or
3.5 with respect to such Lender, such assignment will result in a reduction in
such compensation, reimbursement or payments. A Lender shall not be required to
make any such assignment and delegation if, prior thereto, as a result of a
waiver by such Lender or otherwise, the circumstances entitling the Borrower to
require such assignment and delegation cease to apply.

(c) Nothing in this section 2.10 shall affect or postpone any of the
obligations of the Borrower or the right of any Lender provided in section 2.8
or 3.5.

SECTION 3. LETTERS OF CREDIT.

3.1. LETTERS OF CREDIT. (a) GENERAL. Subject to and upon the terms and
conditions herein set forth, the Borrower may request an Issuing Bank at any
time and from time to time on or after the Closing Date and prior to the date
that is 30 Business Days prior to the Maturity Date to issue, for the account of
the Borrower or any of its Subsidiaries and in support of (i) trade obligations
of the Borrower and its Subsidiaries incurred in the ordinary course of
business, and/or (ii) worker compensation, liability insurance, releases of
contract retention obligations, contract performance guarantee requirements and
other bonding obligations of the Borrower or any such Subsidiary incurred in the
ordinary course of its business, and such other obligations of the Borrower and
its Subsidiaries that are acceptable to the Issuing Bank, and subject to and
upon the terms and conditions herein set forth, such Issuing Bank agrees to
issue from time to time, irrevocable documentary or standby letters of credit
(it being understood that the term "standby" shall include so called "direct
pay" letters of credit) denominated and payable in Dollars or in an Alternative
Currency in such form as may be approved by such Issuing Bank and the
Administrative Agent (each such letter of credit (and each Existing Letter of
Credit described in section 3.1(e)), a "LETTER OF CREDIT" and collectively, the
"LETTERS OF CREDIT"). Letters of Credit issued for purposes referred to in
clause (i) above are sometimes referred to as "DOCUMENTARY LETTERS OF CREDIT",
and Letters of Credit issued for purposes referred to in clause (ii) above are
sometimes referred to as "STANDBY LETTERS OF CREDIT".

(b) MAXIMUM LC EXPOSURE, ETC. A Letter of Credit shall be issued hereunder,
and the Stated Amount of a Letter of Credit shall be increased hereunder, only
if (and upon such issuance or increase the Borrower shall be deemed to represent
and warrant that), after giving effect to such issuance or increase, (i) the
Total LC Exposure shall not exceed $100,000,000, and (ii) the General Revolving
Credit Exposure of each Lender shall not exceed its General Revolving
Commitment.

(i) no individual Letter of Credit (other than any Existing Letter
of Credit) shall be issued which has an initial Stated Amount less than
$100,000 unless such lesser Stated Amount is acceptable to the Issuing
Bank;

(ii) each Standby Letter of Credit shall have an expiry date
(including any renewal periods) occurring not later than the earlier of (A)
one year from the date of issuance thereof, unless a longer period is
approved by the relevant Issuing Bank and the Required Lenders, and (B) 15
Business Days prior to the Maturity Date, in each case on terms acceptable
to the Administrative Agent and the relevant Issuing Bank; and

(iii) each Documentary Letter of Credit (including any acceptances
or time drafts created thereunder) shall have an expiry date (including any
renewal periods) occurring not later than the earlier of (A) six months
from the date of issuance thereof, unless a longer period is approved by
the relevant Issuing Bank and the Required Lenders, and (B) 15 Business
Days prior to the Maturity Date, in each case on terms acceptable to the
Administrative Agent and the relevant Issuing Bank.

(d) EFFECT OF LENDER DEFAULT. Notwithstanding the foregoing, in the event a
Lender Default exists, no Issuing Bank shall be required to issue any Letter of
Credit (or increase the Stated Amount of an outstanding Letter of Credit) unless
either (i) such Issuing Bank has entered into arrangements satisfactory to it
and the Borrower to eliminate such Issuing Bank's risk with respect to the
participation in Letters of Credit of the Defaulting Lender or Lenders,
including by cash collateralizing such Defaulting Lender's or Lenders' LC
Exposure; or (ii) the issuance of such Letter of Credit (or increase in the
Stated Amount of an outstanding Letter of Credit), taking into account the
potential failure of the Defaulting Lender or Lenders to risk participate
therein, will not cause the Issuing Bank to incur Credit Exposure in excess of
its Commitment, and the Borrower has undertaken, for the benefit of such Issuing
Bank, pursuant to an instrument satisfactory in form and substance to such
Issuing Bank, not to thereafter incur, or cause to be issued or created, Loans
or Letters of Credit hereunder which would cause the Issuing Bank to incur
Credit Exposure in excess of its Commitment.

(e) EXISTING LETTERS OF CREDIT. Annex VI hereto contains a description of
certain letters of credit outstanding on, and to continue in effect after, the
Closing Date. Each such letter of credit issued by a bank that is or becomes a
Lender under this Agreement on the Effective Date (each, an "EXISTING LETTER OF
CREDIT") shall constitute a "Letter of Credit" for all purposes of this
Agreement, issued, for purposes of section 3.4(a), on the Closing Date, and the
Borrower, the Administrative Agent and the applicable Lenders hereby agree that,
from and after such date, the terms of this Agreement shall apply to such
Letters of Credit, superseding any other agreement theretofore applicable to
them to the extent inconsistent with the terms hereof.

(f) DISBURSEMENT PROCEDURES. The Issuing Bank shall, promptly following its
receipt thereof, examine all documents purporting to represent a demand for
payment under a Letter of Credit. The Issuing Bank shall promptly notify the
Administrative Agent and the Borrower by telephone (confirmed by telecopy) of
such demand for payment and whether the Issuing Bank has made or will make an LC
Disbursement thereunder; PROVIDED that any failure to give or delay in giving
such notice shall not relieve the Borrower of its obligation to reimburse the
Issuing Bank and the Lenders with respect to any such LC Disbursement.

3.2. LETTER OF CREDIT REQUESTS: NOTICES OF ISSUANCE. (a) Whenever it
desires that a Letter of Credit be issued, the Borrower shall give the
Administrative Agent and the Issuing Bank written or telephonic notice (in the
case of telephonic notice, promptly confirmed in writing if so requested by the
Administrative Agent) which, if in the form of written notice shall be
substantially in the form of Exhibit B-3, or transmit by electronic
communication (if arrangements for doing so have been approved by the Issuing
Bank), prior to 11:00 A.M. (local time at its Notice Office) at least three
Business Days (or such shorter period as may be acceptable to the relevant
Issuing Bank) prior to the proposed date of issuance (which shall be a Business
Day) (each a "LETTER OF CREDIT REQUEST"), which Letter of Credit Request shall
include such supporting documents that such Issuing Bank customarily requires in
connection therewith (including, if required by the Issuing Bank, an application
for, and a reimbursement agreement with respect to, such Letter of Credit). Any
such documents executed in connection with the issuance of a Letter of Credit,

including (without limitation) any application, reimbursement agreement,
guaranty, collateral document, the Letter of Credit itself, or any sight draft
or time draft, are herein referred to as "LETTER OF CREDIT DOCUMENTS". In the
event of any inconsistency between any of the terms or provisions of any Letter
of Credit Document and the terms and provisions of this Agreement respecting
Letters of Credit, the terms and provisions of this Agreement shall control. The
Administrative Agent shall promptly notify each Lender of each Letter of Credit
Request.

(b) Each Issuing Bank shall, on the date of each issuance of a Letter of
Credit by it, give the Administrative Agent and the Borrower written notice of
the issuance of such Letter of Credit, accompanied by a copy to the
Administrative Agent of the Letter of Credit or Letters of Credit issued by it.
Each Issuing Bank shall provide to the Administrative Agent a quarterly (or
monthly if requested by any applicable Lender in writing) summary describing the
outstanding Letters of Credit issued by such Issuing Bank and an identification
for the relevant period of the daily aggregate or average daily aggregate Total
LC Exposure represented by Letters of Credit issued by such Issuing Bank.

3.3. AGREEMENT TO REPAY LC DISBURSEMENTS. (a) If the Issuing Bank shall
make any LC Disbursement in respect of a Letter of Credit, the Borrower shall
reimburse (or cause its applicable Subsidiary which is the account party to
reimburse) such LC Disbursement by paying to the Administrative Agent, for the
account of the Issuing Bank, an amount equal to such LC Disbursement not later
than 12:00 noon (local time at the Payment Office), on the date that such LC
Disbursement is made, if the Borrower shall have received notice of such LC
Disbursement prior to 10:00 a.m.(local time at the Payment Office), on such
date, or, if such notice has not been received by the Borrower prior to such
time on such date, then not later than 12:00 noon (local time at the Payment
Office), on (i) the Business Day that the Borrower receives such notice, if such
notice is received prior to 10:00 a.m. (local time at the Payment Office), on
the day of receipt, or (ii) the Business Day immediately following the day that
the Borrower receives such notice, if such notice is not received prior to such
time on the day of receipt; PROVIDED that if such LC Disbursement is not less
than $1,000,000, the Borrower may, subject to the conditions to Borrowing set
forth herein, request in accordance with section 2.2 that such payment be
financed with a Prime Rate Borrowing in an equivalent amount and, to the extent
so financed, the Borrower's obligation to make such reimbursement payment shall
be discharged and replaced by the resulting Borrowing.

(b) If the Issuing Bank shall make any LC Disbursement, then, unless the
Borrower shall reimburse such LC Disbursement in full not later than 12:00 noon
(local time at the Payment Office) on the date that such LC Disbursement is
made, the unpaid amount thereof shall bear interest, for each day from and
including the date such LC Disbursement is made to but excluding the date that
the Borrower reimburses such LC Disbursement, at the rate per annum then
applicable to Prime Rate Loans; PROVIDED that, if the Borrower fails to
reimburse such LC Disbursement when due pursuant to section 3.3(a), then the
last sentence of section 2.6(d) shall apply. Interest accrued pursuant to this
section 3.3(b) shall be for the account of the Issuing Bank, except that
interest accrued on and after the date of payment by any Lender pursuant to
section 3.4(c) to reimburse the Issuing Bank shall be for the account of such
Lender to the extent of such payment.

(c) The Borrower's obligation under this section 3.3 to reimburse, or cause
a Subsidiary to reimburse, each Issuing Bank with respect to LC Disbursements
(including, in each case, interest thereon) shall be absolute and unconditional
under any and all circumstances and irrespective of any setoff, counterclaim or
defense to payment which the Borrower or any Subsidiary may have or have had
against such Issuing Bank, the Administrative Agent, any other Issuing Bank, any
Lender, or any of their Affiliates, including, without limitation, any defense
based upon the failure of any drawing under a Letter of Credit to conform to the
terms of the Letter of Credit or any non-application or misapplication by the
beneficiary of the proceeds of such drawing, PROVIDED, HOWEVER that the Borrower
shall not be obligated to reimburse, or cause a Subsidiary to reimburse, an
Issuing Bank for any wrongful payment made by such Issuing Bank under a Letter
of Credit as a result of acts or omissions constituting willful misconduct or
gross negligence on the part of such Issuing Bank.

3.4. PARTICIPATIONS IN LETTERS OF CREDIT. (a) Immediately upon the issuance
by an Issuing Bank of any Letter of Credit (and on the Closing Date with respect
to any Existing Letter of Credit), such Issuing Bank shall be deemed to have
sold and transferred to each Lender, and each such Lender (each a "PARTICIPANT")
shall be deemed

irrevocably and unconditionally to have purchased and received from such Issuing
Bank, without recourse or warranty, an undivided interest and participation, to
the extent of such Lender's General Revolving Facility Percentage, in (i) such
Letter of Credit, each substitute letter of credit, and each drawing made
thereunder, (ii) the obligations of the Borrower under this Agreement with
respect thereto (although Letter of Credit Fees shall be payable directly to the
Administrative Agent for the account of the Lenders as provided in section
4.1(b) and the Participants shall have no right to receive any portion of any
fees of the nature contemplated by section 4.1(c) or 4.1(d)), (iii) the
obligations of the Borrower or any Subsidiary under any Letter of Credit
Documents pertaining thereto, and (iv) any security for, or guaranty pertaining
to, any of the foregoing. Upon any change in the Commitments of the Lenders
pursuant to section 12.4(c), it is hereby agreed that, with respect to all
outstanding Letters of Credit and LC Disbursements, there shall be an automatic
adjustment to the participations pursuant to this section 3.4 to reflect the new
General Revolving Facility Percentages of the assigning and assignee Lender.

(b) In determining whether to pay under any Letter of Credit, an Issuing
Bank shall not have any obligation relative to the Participants other than to
determine that any documents required to be delivered under such Letter of
Credit have been delivered and that they appear to comply on their face with the
requirements of such Letter of Credit. Any action taken or omitted to be taken
by an Issuing Bank under or in connection with any Letter of Credit if taken or
omitted in the absence of gross negligence or willful misconduct, shall not
create for such Issuing Bank any resulting liability.

(c) In the event that an Issuing Bank makes any LC Disbursement and the
Borrower shall not have reimbursed (or caused any applicable Subsidiary to
reimburse) such amount in full to such Issuing Bank pursuant to section 3.3(a),
such Issuing Bank shall promptly notify the Administrative Agent, and the
Administrative Agent shall promptly notify each Participant of such failure, and
each Participant shall promptly and unconditionally pay to the Administrative
Agent for the account of such Issuing Bank, the amount of such Participant's
General Revolving Facility Percentage of such LC Disbursement in U.S. Dollars
(the Administrative Agent having determined in the case of any LC Disbursement
by an Issuing Bank made in an Alternative Currency the equivalent thereof in
Dollars) and in same day funds, PROVIDED, HOWEVER, that no Participant shall be
obligated to pay to the Administrative Agent its General Revolving Facility
Percentage of such unreimbursed LC Disbursement for any wrongful payment made by
such Issuing Bank under a Letter of Credit as a result of acts or omissions
constituting willful misconduct or gross negligence on the part of such Issuing
Bank. If the Administrative Agent so notifies any Participant required to fund
an LC Disbursement prior to 11:00 A.M. (local time at its Notice Office) on any
Business Day, such Participant shall make available to the Administrative Agent
for the account of the relevant Issuing Bank such Participant's General
Revolving Facility Percentage of the amount of such LC Disbursement on such
Business Day in same day funds. If and to the extent such Participant shall not
have so made its General Revolving Facility Percentage of the amount of such LC
Disbursement available to the Administrative Agent for the account of the
relevant Issuing Bank, such Participant agrees to pay to the Administrative
Agent for the account of such Issuing Bank, forthwith on demand such amount,
together with interest thereon, for each day from such date until the date such
amount is paid to the Administrative Agent for the account of such Issuing Bank
at the Federal Funds Effective Rate. The failure of any Participant to make
available to the Administrative Agent for the account of the relevant Issuing
Bank its General Revolving Facility Percentage of any unreimbursed LC
Disbursement shall not relieve any other Participant of its obligation hereunder
to make available to the Administrative Agent for the account of such Issuing
Bank its General Revolving Facility Percentage of any unreimbursed LC
Disbursement, on the date required, as specified above, but no Participant shall
be responsible for the failure of any other Participant to make available to the
Administrative Agent for the account of such Issuing Bank such other
Participant's General Revolving Facility Percentage of any such unreimbursed LC
Disbursement.

(d) Whenever an Issuing Bank receives a payment of a reimbursement
obligation for an LC Disbursement as to which the Administrative Agent has
received for the account of such Issuing Bank any payments from the Participants
pursuant to section 3.4(c) above, such Issuing Bank shall pay to the
Administrative Agent and the Administrative Agent shall promptly pay to each
Participant which has paid its General Revolving Facility Percentage thereof, in
U.S. dollars and in same day funds, an amount equal to such Participant's
General Revolving Facility Percentage of the principal amount thereof and
interest thereon accruing after the purchase of the respective participations,
as and to the extent so received.

(e) The obligations of the Participants to make payments to the
Administrative Agent for the account of each Issuing Bank with respect to LC
Disbursements shall be irrevocable and not subject to counterclaim, set-off or
other defense or any other qualification or exception whatsoever and shall be
made in accordance with the terms and conditions of this Agreement under all
circumstances, including, without limitation, any of the following
circumstances:

(i) any lack of validity or enforceability of this Agreement or
any of the other Credit Documents;

(ii) the existence of any claim, set-off defense or other right
which the Borrower (or any Subsidiary) may have at any time against a
beneficiary named in a Letter of Credit, any transferee of any Letter of
Credit (or any person for whom any such transferee may be acting), any
payee of a draft drawn on an Issuing Bank relating to a Letter of Credit,
the Administrative Agent, any Issuing Bank, any Lender, or other person,
whether in connection with this Agreement, any Letter of Credit, the
transactions contemplated herein or any unrelated transactions (including
any underlying transaction between the Borrower (or any Subsidiary) and the
beneficiary named in any such Letter of Credit or the payee named in any
such draft relating to a Letter of Credit, other than any claim which the
Borrower (or any Subsidiary which is the account party with respect to a
Letter of Credit) may have against any applicable Issuing Bank for gross
negligence or wilful misconduct of such Issuing Bank in making payment
under any applicable Letter of Credit;

(iii) any draft, certificate or other document presented under the
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;

(iv) the surrender or impairment of any security for the performance
or observance of any of the terms of any of the Credit Documents: or

(v) the occurrence of any Default or Event of Default.

(f) To the extent the Issuing Bank is not indemnified by the Borrower, the
Participants will reimburse and indemnify the Issuing Bank, in proportion to
their respective General Revolving Facility Percentages, for and against any and
all liabilities, obligations, losses, damages, penalties, claims, actions,
judgments, costs, expenses or disbursements of whatsoever kind or nature which
may be imposed on, asserted against or incurred by the Issuing Bank in
performing its respective duties in any way related to or arising out of its
issuance of Letters of Credit, PROVIDED that no Participants shall be liable for
any portion of such liabilities, obligations, losses, damages, penalties,
claims, actions, judgments, costs, expenses or disbursements resulting from the
Issuing Bank's gross negligence or willful misconduct.

3.5. INCREASED COSTS. If after the Effective Date, the adoption of any
applicable law, rule or regulation, or any change therein, or any change in the
interpretation or administration thereof by any governmental authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or compliance by any Issuing Bank or any Lender with any request or
directive (whether or not having the force of law) by any such authority,
central bank or comparable agency (in each case made subsequent to the Effective
Date) shall either (i) impose, modify or make applicable any reserve, deposit,
capital adequacy or similar requirement against Letters of Credit issued by such
Issuing Bank, or such Lender's participation therein, or (ii) shall impose on
such Issuing Bank or any Lender any other conditions affecting this Agreement,
any Letter of Credit, or such Lender's participation therein; and the result of
any of the foregoing is to increase the cost to such Issuing Bank or such Lender
of issuing, creating, maintaining or participating in any Letter of Credit, or
to reduce the amount of any sum received or receivable by such Issuing Bank or
such Lender hereunder (other than any increased cost or reduction in the amount
received or receivable resulting from the imposition of or a change in the rate
of taxes or similar charges), THEN, upon demand to the Borrower by such Issuing
Bank or such Lender (a copy of which notice shall be sent by such Issuing Bank
or such Lender to the Administrative Agent), the Borrower shall pay to such
Issuing Bank or such Lender such

additional amount or amounts as will compensate any such Issuing Bank or such
Lender for such increased cost or reduction. A certificate submitted to the
Borrower by any Issuing Bank or any Lender, as the case may be (a copy of which
certificate shall be sent by such Issuing Bank or such Lender to the
Administrative Agent), setting forth, in reasonable detail, the basis for the
determination of such additional amount or amounts necessary to compensate any
Issuing Bank or such Lender as aforesaid shall be conclusive and binding on the
Borrower absent manifest error, although the failure to deliver any such
certificate shall not release or diminish any of the Borrower's obligations to
pay additional amounts pursuant to this section 3.4. Reference is hereby made to
the provisions of section 2.10(d) for certain limitations upon the rights of an
Issuing Bank or Lender under this section.

3.6. GUARANTY OF SUBSIDIARY LETTER OF CREDIT OBLIGATIONS. (a) The Borrower
hereby unconditionally guarantees, for the benefit of the Administrative Agent
and the Lenders, the full and punctual payment of the Obligations of each
Subsidiary under each Letter of Credit Document to which such Subsidiary is now
or hereafter becomes a party. Upon failure by any such Subsidiary to pay
punctually any such amount, the Borrower shall forthwith on demand by the
Administrative Agent pay the amount not so paid at the place and in the currency
and otherwise in the manner specified in this Agreement or any applicable Letter
of Credit Document.

(b) As a separate, additional and continuing obligation, the Borrower
unconditionally and irrevocably undertakes and agrees, for the benefit of the
Administrative Agent and the Lenders, that, should any amounts not be
recoverable from the Borrower under section 3.6(a) for any reason whatsoever
(including, without limitation, by reason of any provision of any Credit
Document or any other agreement or instrument executed in connection therewith
being or becoming void, unenforceable, or otherwise invalid under any applicable
law) then, notwithstanding any notice or knowledge thereof by any Lender, the
Administrative Agent, any of their respective Affiliates, or any other person,
at any time, the Borrower as sole, original and independent obligor, upon demand
by the Administrative Agent, will make payment to the Administrative Agent, for
the account of the Lenders and the Administrative Agent, of all such obligations
not so recoverable by way of full indemnity, in such currency and otherwise in
such manner as is provided in the Credit Documents.

(c) The obligations of the Borrower under this section shall be
unconditional and absolute and, without limiting the generality of the foregoing
shall not be released, discharged or otherwise affected by the occurrence, one
or more times, of any of the following:

(i) any extension, renewal, settlement, compromise, waiver or
release in respect to any obligation of any Subsidiary under any Letter of
Credit Document, by operation of law or otherwise;

(ii) any modification or amendment of or supplement to this
Agreement, any Note or any other Credit Document;

(iii) any release, non-perfection or invalidity of any direct or
indirect security for any obligation of the Borrower under this Agreement,
any Note or any other Credit Document or of any Subsidiary under any Letter
of Credit Document;

(iv) any change in the corporate existence, structure or ownership
of any Subsidiary or any insolvency, bankruptcy, reorganization or other
similar proceeding affecting any Subsidiary or its assets or any resulting
release or discharge of any obligation of any Subsidiary contained in any
Letter of Credit Document;

(v) the existence of any claim, set-off or other rights which the
Borrower may have at any time against any Subsidiary, the Administrative
Agent, any Lender or any other person, whether in connection herewith or
any unrelated transactions;

(vi) any invalidity or unenforceability relating to or against any
Subsidiary for any reason of any Letter of Credit Document, or any
provision of applicable law or regulation purporting to prohibit the
payment by any Subsidiary of any Obligations in respect of any Letter of
Credit; or

(vii) any other act or omission to act or delay of any kind by any
Subsidiary, the Administrative Agent, any Lender or any other person or any
other circumstance whatsoever which might, but for the provisions of this
section, constitute a legal or equitable discharge of the Borrower's
obligations under this section.

(d) The Borrower's obligations under this section shall remain in full
force and effect until the Commitments shall have terminated and the principal
of and interest on the Notes and all other amounts payable by the Borrower under
the Credit Documents and by any Subsidiary under the Letter of Credit Documents
shall have been paid in full. If at any time any payment of any of the
Obligations of any Subsidiary in respect of any Letter of Credit Documents is
rescinded or must be otherwise restored or returned upon the insolvency,
bankruptcy or reorganization of such Subsidiary, the Borrower's obligations
under this section with respect to such payment shall be reinstated at such time
as though such payment had been due but not made at such time.

(e) The Borrower irrevocably waives acceptance hereof, presentment, demand,
protest and any notice not provided for herein, as well as any requirement that
at any time any action be taken by any person against any Subsidiary or any
other person, or against any collateral or guaranty of any other person.

(f) The Borrower hereby subordinates all rights, whether arising by
operation of law or otherwise, which it may have upon making any payment under
this section to be subrogated to the rights of the payee against any Subsidiary
with respect to such payment or otherwise to be reimbursed, indemnified or
exonerated by any Subsidiary in respect thereof, to the indefeasible payment in
full of all of the Obligations.

(g) In the event that acceleration of the time for payment of any amount
payable by any Subsidiary under any Letter of Credit Document is stayed upon
insolvency, bankruptcy or reorganization of such Subsidiary, all such amounts
otherwise subject to acceleration under the terms of any applicable Letter of
Credit Document shall nonetheless be payable by the Borrower under this section
forthwith on demand by the Administrative Agent.

SECTION 4. FEES AND COMMISSIONS; TERMINATION
AND REDUCTION OF COMMITMENTS.

4.1. FEES AND COMMISSIONS. (a) FACILITY FEE. (i) The Borrower agrees to pay
to the Administrative Agent a Facility Fee ("FACILITY FEE") for the account of
each Non-Defaulting Lender which has a General Revolving Commitment for the
period from and including the Effective Date to but not including the date the
Total General Revolving Commitment has been terminated and no Loans or Letters
of Credit are outstanding, which, for any such Lender, shall be computed on the
daily amount of the General Revolving Commitment of such Lender, whether used or
unused, at the Applicable Facility Fee Rate, payable quarterly in arrears on the
last Business Day of each April, July, October and January and on the date when
the Total General Revolving Commitment has been terminated and no Loans or
Letters of Credit are outstanding, commencing with the last Business Day of the
first such date occurring after the Effective Date for the period from the
Effective Date to such date.

(ii) As used herein, the term "APPLICABLE FACILITY FEE RATE" means the
particular rate per annum determined by the Administrative Agent in accordance
with the Pricing Grid Table which appears in section 2.6(g), based on the
Borrower's Fixed Charge Coverage Ratio and such Pricing Grid Table, and the
following provisions:

(A) Initially, until changed hereunder in accordance with the
following provisions, the Applicable Facility Fee Rate will be 40 basis
points per annum.

(B) Commencing with the fiscal quarter of the Borrower ended on
or nearest to January 31, 2000, and continuing with each fiscal quarter
thereafter, the Administrative Agent will determine the Applicable
Facility Fee Rate in accordance with the Pricing Grid Table, based on
the Borrower's Fixed Charge Coverage Ratio for the Testing Period ended
on the last day of the fiscal quarter, and identified in such Table.
Changes in the Applicable Facility Fee Rate based upon changes in such
Fixed Charge Coverage

Ratio shall become effective on the first day of the month following the
receipt by the Administrative Agent pursuant to section 8.1(a) or (b) of
the financial statements of the Borrower, accompanied by the certificate
and calculations referred to in section 8.1(c), demonstrating the
computation of such Fixed Charge Coverage Ratio, based upon the Fixed
Charge Coverage Ratio in effect at the end of the applicable period
covered (in whole or in part) by such financial statements.

(C) Notwithstanding the above provisions, during any period when (1)
the Borrower has failed to timely deliver its consolidated financial
statements referred to in section 8.1(a) or (b), accompanied by the
certificate and calculations referred to in section 8.1(c), (2) a Default
under section 10.1(a) has occurred and is continuing, or (3) an Event of
Default has occurred and is continuing, the Applicable Facility Fee Rate
shall be the highest rate per annum indicated therefor in the Pricing Grid
Table, regardless of the Borrower's Fixed Charge Coverage Ratio at such
time.

(D) Any changes in the Applicable Facility Fee Rate shall be
determined by the Administrative Agent in accordance with the above
provisions and the Administrative Agent will promptly provide notice of
such determinations to the Borrower and the Lenders. Any such determination
by the Administrative Agent pursuant to this section 4.1(a) shall be
conclusive and binding absent manifest error.

(b) LETTER OF CREDIT FEE. The Borrower agrees to pay to the Administrative
Agent, for the account of each Non-Defaulting Lender, PRO RATA on the basis of
its General Revolving Facility Percentage, a fee in respect of each Letter of
Credit (the "LETTER OF CREDIT FEE"), computed for each day at the rate per annum
equal to

(i) in the case of any Standby Letter of Credit, 100% of the
Applicable Eurodollar Margin then in effect on the Stated Amount thereof
which is outstanding on such day; or

(ii) in the case of any Documentary Letter of Credit, 50% of the
Applicable Eurodollar Margin then in effect on the Stated Amount thereof
outstanding on such day, EXCEPT that if any banker's acceptance or time
draft is created or issued under any Documentary Letter of Credit, such
rate as applied to the Stated Amount of such banker's acceptance or time
draft which is outstanding on such day shall be 100% of the Applicable
Eurodollar Margin then in effect.

Accrued Letter of Credit Fees shall be payable on the last Business Day of each
April, July, October and January and on the date on which the Total Commitment
has been terminated and no Letters of Credit are outstanding. Notwithstanding
the above provisions, if a Default under section 10.1(a) or Event of Default is
in existence, the Borrower will pay to the Administrative Agent, on demand, for
the account of each Non-Defaulting Lender, PRO RATA on the basis of its General
Revolving Facility Percentage, an additional Letter of Credit Fee for each
outstanding Letter of Credit, computed at 2% per annum above the then prevailing
rate for the Letter of Credit Fee on the Stated Amount of such outstanding
Letter of Credit for the period such Default or Event of Default is in
existence.

(c) FRONTING FEES. The Borrower agrees to pay directly to each Issuing
Bank, for its own account, a fee in respect of each Letter of Credit issued by
it (a "FRONTING FEE"), payable at such time or time and at such rate or rates as
may from time to time be agreed between the Borrower and such Issuing Bank.

(d) ADDITIONAL CHARGES OF ISSUING BANK FOR LETTERS OF CREDIT. The Borrower
agrees to pay directly to each Issuing Bank, upon each issuance of, drawing
under, creation or issuance of a banker's acceptance or time draft under, and/or
amendment, extension, renewal or transfer of, a Letter of Credit issued by it,
(i) such amount (and payable at such time or times) as may from time to time be
agreed between the Borrower and such Issuing Bank, or (ii) in the absence of any
such agreement, such amounts as shall at the time be the administrative or
processing charge which such Issuing Bank is customarily charging for issuances
of, drawings under, creation or issuance of a banker's acceptance or time draft
under, or amendments, extensions, renewals or transfers of, letters of credit
issued by it.

(e) OTHER FEES. The Borrower shall pay to the Administrative Agent on the
Effective Date and thereafter for its own account and/or for distribution to the
Lenders such fees as heretofore agreed by the Borrower and the Administrative
Agent.

(f) COMPUTATIONS OF FEES. All computations of Fees shall be made in
accordance with section 12.7(b).

4.2. VOLUNTARY TERMINATION/REDUCTION OF COMMITMENTS. Upon at least three
Business Days' prior written notice (or telephonic notice confirmed in writing)
to the Administrative Agent at its Notice Office (which notice the
Administrative Agent shall promptly transmit to each of the affected Lenders),
the Borrower shall have the right, without premium or penalty, to:

(a) terminate the Total Commitment, PROVIDED that (i) all
outstanding Loans are contemporaneously prepaid in accordance with section
5.1, and (ii) there is no LC Exposure for any Lender at such time;

(b) terminate the Swing Line Commitment, PROVIDED that all
outstanding Swing Line Loans are contemporaneously prepaid in accordance
with section 5.1;

(c) partially and permanently reduce the Unutilized Total General
Revolving Commitment, PROVIDED that (i) any such reduction shall apply to
proportionately and permanently reduce the General Revolving Commitment of
each of the Lenders; and (ii) any partial reduction of the Unutilized Total
General Revolving Commitment pursuant to this section 4.2(b) shall be in
the amount of at least $5,000,000 (or, if greater, in integral multiples of
$1,000,000); and (iii) after giving effect to any such partial reduction of
the Unutilized Total General Revolving Commitment, the Total General
Revolving Commitment then in effect shall exceed the Swing Line Commitment
then in effect by at least $10,000,000; and/or

(d) partially and permanently reduce the Unutilized Swing Line
Commitment, PROVIDED that any partial reduction of the Unutilized Swing
Line Commitment pursuant to this section 4.2(d) shall be in the amount of
at least $1,000,000 (or, if greater, in integral multiples of $1,000,000).

4.3. MANDATORY TERMINATION/ADJUSTMENTS OF COMMITMENTS, ETC. (a) The Total
Commitment (and the Commitment of each Lender) shall terminate on June 15, 1999,
unless the Closing Date has occurred on or prior to such date.

(b) The Total Commitment shall terminate (and the Commitment of each Lender
shall terminate) on the date on which a Change of Control occurs.

4.4. EXTENSION OF MATURITY DATE. At any time after February 15, 2000, and
during the 30 day period following delivery by the Borrower pursuant to section
8.1(a) of its consolidated financial statements for its fiscal year most
recently ended, and annually thereafter during the 30 day period following
delivery by the Borrower of its consolidated financial statements pursuant to
section 8.1(a), the Borrower may request the Administrative Agent to determine
if all of the Lenders are then willing to extend the Maturity Date for a single
additional year. If the Borrower so requests, the Administrative Agent will so
advise such Lenders. If all of such Lenders in their sole discretion are all
willing to so extend the Maturity Date, after taking into account such
considerations as any such Lender may deem relevant, the Borrower, the
Administrative Agent and all of such Lenders shall execute and deliver a
definitive written instrument so extending the Maturity Date. No such extension
of the Maturity Date shall be valid or effective for any purpose unless such
definitive written instrument is so signed and delivered within 60 days
following the giving by the Administrative Agent of notice to the Lenders that
the Borrower has requested such an extension.

SECTION 5. PAYMENTS.

5.1. VOLUNTARY PREPAYMENTS. The Borrower shall have the right to prepay any
of its Loans, in whole or in part, without premium or penalty, from time to time
on the following terms and conditions:

(a) the Borrower shall give the Administrative Agent at the Notice
Office written or telephonic notice (in the case of telephonic notice,
promptly confirmed in writing if so requested by the Administrative Agent)
of its intent to prepay the Loans, the amount of such prepayment and (in
the case of Eurodollar Loans or Swing Line Loans) the specific Borrowing(s)
pursuant to which made, which notice shall be received by the
Administrative Agent by

(x) 11:00 A.M. (local time at the Notice Office) three
Business Days prior to the date of such prepayment, in the case of
any prepayment of Eurodollar Loans, or

(y) 12:00 noon (local time at the Notice Office) on the date
of such prepayment, in the case of any prepayment of Prime Rate
Loans or Money Market Rate Loans,

and which notice shall promptly be transmitted by the Administrative Agent
to each of the affected Lenders;

(b) in the case of any partial prepayment of any Borrowing under the
General Revolving Facility, such partial prepayment shall be in an
aggregate principal of at least:

(i) $1,000,000 or an integral multiple of $100,000 in
excess thereof, in the case of a Prime Rate Borrowing, or

(ii) $5,000,000 or an integral multiple of $500,000 in
excess thereof, in the case of a Eurodollar Borrowing;

(c) in the case of any partial prepayment of any Borrowing under the
Swing Line Facility, such partial prepayment shall be in an aggregate
principal of at least $100,000 or an integral multiple of $50,000 in excess
thereof;

(d) no partial prepayment of any Loans made pursuant to a Borrowing
shall reduce the aggregate principal amount of such Loans outstanding
pursuant to such Borrowing to an amount less than the Minimum Borrowing
Amount applicable thereto;

(e) each prepayment in respect of any Loans made pursuant to a
Borrowing shall be applied PRO RATA among such Loans; and

(f) each prepayment of Eurodollar Loans or Money Market Rate Loans
pursuant to this section 5.1 on any date other than the last day of the
Interest Period applicable thereto, in the case of Eurodollar Loans, or the
maturity date thereof, in the case of Money Market Rate Loans, shall be
accompanied by any amounts payable in respect thereof under section 2.9.

5.2. MANDATORY PREPAYMENTS. The Loans shall be subject to mandatory
prepayment in accordance with the following provisions:

(a) IF TOTAL GENERAL REVOLVING CREDIT EXPOSURE EXCEEDS TOTAL GENERAL
REVOLVING COMMITMENT. If on any date (after giving effect to any other
payments on such date) the Total General Revolving Credit Exposure on such
date exceeds the Total General Revolving Commitment as then in effect, the
Borrower shall prepay on such date that principal amount of Swing Line
Loans and after Swing Line Loans have been paid in full, General Revolving
Loans and, after General Revolving Loans have been paid in full, LC
Disbursements which remain unpaid, in an aggregate amount at least equal to
such excess and

conforming in the case of partial prepayments of Loans to the requirements
as to the amounts of partial prepayments of Loans which are contained in
section 5.1. If, after giving effect to the prepayment of Swing line Loans,
General Revolving Loans and LC Disbursements which remain unpaid, the Total
LC Exposure exceeds the Total General Revolving Commitment as then in
effect, the Borrower shall pay to the Administrative Agent an amount in
cash and/or Cash Equivalents equal to such excess and the Administrative
Agent shall hold such payment as security for the reimbursement obligations
of the Borrower hereunder in respect of Letters of Credit pursuant to a
cash collateral agreement to be entered into in form and substance
reasonably satisfactory to the Administrative Agent and the Borrower (which
shall permit certain investments in Cash Equivalents satisfactory to the
Administrative Agent and the Borrower until the proceeds are applied to the
secured obligations).

(b) IF OUTSTANDING SWING LINE LOANS EXCEED UNUTILIZED TOTAL GENERAL
REVOLVING COMMITMENT. If on any date (after giving effect to any other
payments on such date) the aggregate outstanding principal amount of Swing
Line Loans exceeds the Unutilized Total General Revolving Commitment as
then in effect, the Borrower shall prepay on such date Swing Line Loans in
an aggregate amount at least equal to such excess and conforming in the
case of partial prepayments of Swing Line Loans to the requirements as to
the amounts of partial prepayments of Swing Line Loans which are contained
in section 5.1.

(c) IF OUTSTANDING SWING LINE LOANS EXCEED SWING LINE COMMITMENT. If
on any date (after giving effect to any other payments on such date) the
aggregate outstanding principal amount of Swing Line Loans exceeds the
Swing Line Commitment at such time, the Borrower shall prepay on such date
Swing Line Loans in an aggregate amount at least equal to such excess and
conforming in the case of partial prepayments of Swing Line Loans to the
requirements as to the amounts of partial prepayments of Swing Line Loans
which are contained in section 5.1.

(d) CHANGE OF CONTROL. On the date of which a Change of Control
occurs, notwithstanding anything to the contrary contained in this
Agreement, no further Borrowings shall be made, no Issuing Bank shall
issue, renew, or increase the Stated Amount of, any Letter of Credit, and
the then outstanding principal amount of all Loans, if any, then
outstanding shall become due and payable and shall be prepaid in full, and
the Borrower shall contemporaneously either (i) cause all outstanding
Letters of Credit to be surrendered for cancellation (any such Letters of
Credit to be replaced by letters of credit issued by other financial
institutions acceptable to the Required Lenders), or (ii) the Borrower
shall pay to the Administrative Agent an amount in cash and/or Cash
Equivalents equal to 100% of the Total LC Exposure and the Administrative
Agent shall hold such payment as security for the reimbursement obligations
of the Borrower hereunder in respect of the Total LC Exposure pursuant to a
cash collateral agreement to be entered into in form and substance
reasonably satisfactory to the Administrative Agent and the Borrower (which
shall permit certain investments in Cash Equivalents satisfactory to the
Administrative Agent and the Borrower until the proceeds are applied to the
secured obligations).

(e) PARTICULAR LOANS TO BE PREPAID. With respect to each repayment
or prepayment of Loans required by this section 5.2, the Borrower shall
designate the Types of Loans which are to be prepaid and the specific
Borrowing(s) pursuant to which such repayment or prepayment is to be made,
PROVIDED that (i) the Borrower shall first so designate all Loans that are
Prime Rate Loans and Eurodollar Loans with Interest Periods ending on the
date of repayment or prepayment prior to designating any other Eurodollar
Loans for repayment or prepayment, (ii) if the outstanding principal amount
of Eurodollar Loans made pursuant to a Borrowing is reduced below the
applicable Minimum Borrowing Amount as a result of any such repayment or
prepayment, then all the Loans outstanding pursuant to such Borrowing shall
be Converted into Prime Rate Loans, and (iii) each repayment and prepayment
of any Loans made pursuant to a Borrowing shall be applied PRO RATA among
such Loans. In the absence of a designation by the Borrower as described in
the preceding sentence, the Administrative Agent shall, subject to the
above, make such designation in its sole discretion with a view, but no
obligation, to minimize breakage costs owing under section 2.9. Any

repayment or prepayment of Eurodollar Loans or Money Market Rate Loans
pursuant to this section 5.2 shall in all events be accompanied by such
compensation as is required by section 2.9.

5.3. METHOD AND PLACE OF PAYMENT. Except as otherwise specifically provided
herein, all payments under this Agreement shall be made to the Administrative
Agent for the ratable (based on its PRO RATA share) account of the Lenders
entitled thereto, not later than 11:00 A.M. (local time at the Payment Office)
on the date when due and shall be made in immediately available funds and in
lawful money of the United States of America at the Payment Office, it being
understood that written notice by the Borrower to the Administrative Agent to
make a payment from the funds in the Borrower's account at the Payment Office
shall constitute the making of such payment to the extent of such funds held in
such account. Any payments under this Agreement which are made later than 11:00
A.M. (local time at the Payment Office) shall be deemed to have been made on the
next succeeding Business Day. Whenever any payment to be made hereunder shall be
stated to be due on a day which is not a Business Day, the due date thereof
shall be extended to the next succeeding Business Day and, with respect to
payments of principal, interest shall be payable during such extension at the
applicable rate in effect immediately prior to such extension.

5.4. NET PAYMENTS. (a) All payments made by the Borrower hereunder, under
any Note or any other Credit Document, will be made without setoff, counterclaim
or other defense. Except as provided for in section 5.4(b), all such payments
will be made free and clear of, and without deduction or withholding for, any
present or future taxes, levies, imposts, duties, fees, assessments or other
charges of whatever nature now or hereafter imposed by any jurisdiction or by
any political subdivision or taxing authority thereof or therein with respect to
such payments (but excluding, except as provided in the second succeeding
sentence, any tax, imposed on or measured by the net income or net profits of a
Lender pursuant to the laws of the jurisdiction under which such Lender is
organized or the jurisdiction in which the principal office or Applicable
Lending Office of such Lender is located, or any subdivision thereof or therein)
and all interest, penalties or similar liabilities with respect to such non
excluded taxes, levies imposts, duties, fees, assessments or other charges (all
such nonexcluded taxes levies, imposts, duties, fees assessments or other
charges being referred to collectively as "TAXES"). If any Taxes are so levied
or imposed, the Borrower agrees to pay the full amount of such Taxes and such
additional amounts as may be necessary so that every payment by it of all
amounts due hereunder, under any Note or under any other Credit Document, after
withholding or deduction for or on account of any Taxes will not be less than
the amount provided for herein or in such Note or in such other Credit Document.
If any amounts are payable in respect of Taxes pursuant to the preceding
sentence, the Borrower agrees to reimburse each Lender, upon the written request
of such Lender for taxes imposed on or measured by the net income or profits of
such Lender pursuant to the laws of the jurisdiction in which such Lender is
organized or in which the principal office or Applicable Lending Office of such
Lender is located or under the laws of any political subdivision or taxing
authority of any such jurisdiction in which the principal office or Applicable
Lending Office of such Lender is located and for any withholding of income or
similar taxes imposed by the United States of America as such Lender shall
determine are payable by, or withheld from, such Lender in respect of such
amounts so paid to or on behalf of such Lender pursuant to the preceding
sentence and in respect of any amounts paid to or on behalf of such Lender
pursuant to this sentence, which request shall be accompanied by a statement
from such Lender setting forth, in reasonable detail, the computations used in
determining such amounts. The Borrower will furnish to the Administrative Agent
within 45 days after the date the payment of any Taxes, or any withholding or
deduction on account thereof, is due pursuant to applicable law certified copies
of tax receipts, or other evidence satisfactory to the Lender, evidencing such
payment by the Borrower. The Borrower will indemnify and hold harmless the
Administrative Agent and each Lender, and reimburse the Administrative Agent or
such Lender upon its written request, for the amount of any Taxes so levied r
imposed and paid or withheld by such Lender.

(b) Each Lender that is not a United States person (as such term is defined
in section 7701(a)(30) of the Code) for Federal income tax purposes agrees to
provide to the Borrower and the Administrative Agent on or prior to the
Effective Date, or in the cases of a Lender that is an assignee or transferee of
an interest under this Agreement pursuant to section 12.4 (unless the respective
Lender was already a Lender hereunder immediately prior to such assignment or
transfer and such Lender is in compliance with the provisions of this section
5.4(b)), on the date of such assignment or transfer to such Lender, (i) two
accurate and complete original signed copies of Internal Revenue Service Form
4224 or 1001 (or successor forms) certifying to such Lender's entitlement to a
complete exemption from United States withholding tax with respect to payments
to be made under this Agreement, any Note or any other

Credit Document, or (ii) if the Lender is not a "bank" within the meaning of
section 881(c)(3)(A) of the Code and cannot deliver either Internal Revenue
Service Form 1001 or 4224 pursuant to clause (i) above, (x) a certificate
substantially in the form of Exhibit F (any such certificate, a "SECTION
5.4(b)(ii) CERTIFICATE") and (y) two accurate and complete original signed
copies of Internal Revenue Service Form W-8 (or successor form) certifying to
such Lender's entitlement to a complete exemption from United States withholding
tax with respect to payments of interest to be made under this Agreement, any
Note or any other Credit Document. In addition, each Lender agrees that from
time to time after the Effective Date, when a lapse in time or change in
circumstances renders the previous certification obsolete or inaccurate in any
material respect, it will deliver to the Borrower and the Administrative Agent
two new accurate and complete original signed copies of Internal Revenue Service
Form 4224 or 1001, or Form W-8 and a Section 5.4(b)(ii) Certificate, as the case
may be, and such other forms as may be required in order to confirm or establish
the entitlement of such Lender to a continued exemption from or reduction in
United States withholding tax with respect to payments under this Agreement, any
Note or any other Credit Document, or it shall immediately notify the Borrower
and the Administrative Agent of its inability to deliver any such Form or
Certificate, in which case such Lender shall not be required to deliver any such
Form or Certificate pursuant to this section 5.4(b). Notwithstanding anything to
the contrary contained in section 5.4(a), but subject to section 12.4(b) and the
immediately succeeding sentence, (x) the Borrower shall be entitled, to the
extent it is required to do so by law, to deduct or withhold income or other
similar taxes imposed by the United States (or any political subdivision or
taxing authority thereof or therein) from interest, fees or other amounts
payable hereunder for the account of any Lender which is not a United States
person (as such term is defined in section 7701(a)(30) of the Code) for United
States federal income tax purposes and which has not provided to the Borrower
such forms that establish a complete exemption from such deduction or
withholding and (y) the Borrower shall not be obligated pursuant to section
5.4(a) hereof to gross-up payments to be made to a Lender in respect of income
or similar taxes imposed by the United States or any additional amounts with
respect thereto (I) if such Lender has not provided to the Borrower the Internal
Revenue Service forms required to be provided to the Borrower pursuant to this
section 5.4(b) or (II) in the case of a payment other than interest, to a Lender
described in clause (ii) above, to the extent that such forms do not establish a
complete exemption from withholding of such taxes. Notwithstanding anything to
the contrary contained in the preceding sentence or elsewhere in this section
5.4 and except as specifically provided for in section 12.4(b), the Borrower
agrees to pay additional amounts and indemnify each Lender in the manner set
forth in section 5.4(a) (without regard to the identity of the jurisdiction
requiring the deduction or withholding) in respect of any Taxes deducted or
withheld by it as described in the previous sentence as a result of any changes
after the Effective Date in any applicable law, treaty, governmental rule,
regulation, guideline or order, or in the interpretation thereof, relating to
the deducting or withholding of income or similar Taxes.

(c) If any Lender, in its sole opinion, determines that it has finally and
irrevocably received or been granted a refund in respect of any Taxes paid as to
which indemnification has been paid by the Borrower pursuant to this section, it
shall promptly remit such refund (including any interest received in respect
thereof), net of all out-of-pocket costs and expenses; PROVIDED, that the
Borrower agrees to promptly return any such refund (plus interest, if previously
paid to the Borrower with the refund) to such Lender in the event such Lender is
required to repay such refund to the relevant taxing authority. Any such Lender
shall provide the Borrower with a copy of any notice of assessment from the
relevant taxing authority (redacting any unrelated confidential information
contained therein) requiring repayment of such refund. Nothing contained herein
shall impose an obligation on any Lender to apply for any such refund.

(d) Reference is hereby made to the provisions of section 2.8(d) for
certain limitations upon the rights of a Lender under this section.

SECTION 6. CONDITIONS PRECEDENT.

6.1. CONDITIONS PRECEDENT AT CLOSING DATE. The obligation of the Lenders to
make Loans, and of any Issuing Bank to issue Letters of Credit, is subject to
the satisfaction of each of the following conditions on the Closing Date:

(a) EFFECTIVENESS; NOTES. On or prior to the Closing Date, (i) the
Effective Date shall have occurred and (ii) there shall have been delivered
to the Administrative Agent for the account of each Lender the appropriate
Note or Notes executed by the Borrower, in each case, in the amount,
maturity and as otherwise provided herein.

(b) FEES, ETC. The Borrower shall have paid or caused to be paid all
fees required to be paid by it on or prior to such date pursuant to section
4.1 hereof and all reasonable fees and expenses of the Administrative Agent
and of special counsel to the Administrative Agent which have been invoiced
on or prior to such date in connection with the preparation, execution and
delivery of this Agreement and the other Credit Documents and the
consummation of the transactions contemplated hereby and thereby.

(c) OTHER CREDIT DOCUMENTS. The Credit Parties named therein shall
have duly executed and delivered and there shall be in full force and
effect, and original counterparts shall have been delivered to the
Administrative Agent, in sufficient quantities for the Administrative Agent
and the Lenders, of, the Subsidiary Guaranty (as modified, amended or
supplemented from time to time in accordance with the terms thereof and
hereof, the "SUBSIDIARY GUARANTY"), substantially in the form attached
hereto as Exhibit C.

(d) CORPORATE RESOLUTIONS AND APPROVALS. The Administrative Agent
shall have received, in sufficient quantity for the Administrative Agent
and the Lenders, certified copies of the resolutions of the Board of
Directors of the Borrower and each other Credit Party, approving the Credit
Documents to which the Borrower or any such other Credit Party, as the case
may be, is or may become a party, and of all documents evidencing other
necessary corporate action and governmental approvals, if any, with respect
to the execution, delivery and performance by the Borrower or any such
other Credit Party of the Credit Documents to which it is or may become a
party.

(e) INCUMBENCY CERTIFICATES. The Administrative Agent shall have
received, in sufficient quantity for the Administrative Agent and the
Lenders, a certificate of the Secretary or an Assistant Secretary of the
Borrower and of each other Credit Party, certifying the names and true
signatures of the officers of the Borrower or such other Credit Party, as
the case may be, authorized to sign the Credit Documents to which the
Borrower or such other Credit Party is a party and any other documents to
which the Borrower or any such other Credit Party is a party which may be
executed and delivered in connection herewith.

(f) OPINION OF COUNSEL. On the Closing Date, the Administrative
Agent shall have received an opinion, addressed to the Administrative Agent
and each of the Lenders and dated the Closing Date, from Xxxxxxxx, Xxxx &
Xxxxx LLP, special counsel to the Borrower, substantially in the form of
Exhibit D hereto and covering such other matters incident to the
transactions contemplated hereby as the Administrative Agent may reasonably
request, such opinion to be in form and substance satisfactory to the
Administrative Agent.

(g) EXISTING CREDIT FACILITY. Contemporaneously with the Closing
Date, the Borrower shall have terminated its existing credit agreement,
dated as of September 30, 1994, as amended, and prepaid any borrowings
thereunder.

(h) SUBORDINATED NOTE OFFERING COMPLETED. On or prior to the Closing
Date, the Borrower shall have completed the offering of at least
$125,000,000 aggregate principal amount of its subordinated notes (the
"SUBORDINATED NOTES"), with subordination provisions, financial and other
covenants, redemption provisions, a maturity of not less than 7 years, and
guarantees (on a senior subordinated basis) by Subsidiaries of the
Borrower, consistent with the description of the terms of such subordinated
notes which

is included in the Offering Memorandum dated April 14, 1999 (Subject to
Completion), previously delivered to the Lenders (with such modifications
as shall be reasonably acceptable to the Administrative Agent, exclusive of
matters related to interest rate, offering price and redemption prices).
The indenture relating to the Subordinated Notes, including any indenture
relating to a registered Exchange Offer (as described in such Offering
Memorandum) for the Subordinated Notes, is herein referred to as the
"SUBORDINATED NOTE INDENTURE".

(i) PROCEEDINGS AND DOCUMENTS. All corporate and other proceedings
and all documents incidental to the transactions contemplated hereby shall
be satisfactory in substance and form to the Administrative Agent and the
Lenders and the Administrative Agent and its special counsel and the
Lenders shall have received all such counterpart originals or certified or
other copies of such documents as the Administrative Agent or its special
counsel or any Lender may reasonably request.

6.2. CONDITIONS PRECEDENT TO ALL CREDIT EVENTS. The obligations of the
Lenders to make each Loan and/or of an Issuing Bank to issue each Letter of
Credit is subject, at the time thereof, to the satisfaction of the following
conditions:

(a) NOTICE OF BORROWING, ETC. The Administrative Agent shall have
received a Notice of Borrowing meeting the requirements of section 2.2 with
respect to the incurrence of Loans, or a Letter of Credit Request meeting
the requirement of section 3.2 with respect to the issuance of a Letter of
Credit, as applicable.

(b) NO DEFAULT; REPRESENTATIONS AND WARRANTIES. At the time of each
Credit Event and also after giving effect thereto, (i) there shall exist no
Default or Event of Default and (ii) all representations and warranties of
the Credit Parties contained herein or in the other Credit Documents shall
be true and correct in all material respects with the same effect as though
such representations and warranties had been made on and as of the date of
such Credit Event, except to the extent that such representations and
warranties expressly relate to an earlier specified date, in which case
such representations and warranties shall have been true and correct in all
material respects as of the date when made.

The acceptance of the benefits of each Credit Event shall constitute a
representation and warranty by the Borrower to each of the Lenders that all of
the applicable conditions specified in section 6.1 and/or 6.2, as the case may
be, exist as of that time. All of the certificates, legal opinions and other
documents and papers referred to in this section 6, unless otherwise specified,
shall be delivered to the Administrative Agent for the account of each of the
Lenders and, except for the Notes, in sufficient counterparts for each of the
Lenders, and the Administrative Agent will promptly distribute to the Lenders
their respective Notes and the copies of such other certificates, legal opinions
and documents.

SECTION 7. REPRESENTATIONS AND WARRANTIES.

In order to induce the Lenders to enter into this Agreement and to make the
Loans, and/or to issue and/or to participate in the Letters of Credit provided
for herein, the Borrower makes the following representations and warranties to,
and agreements with, the Lenders, all of which shall survive the execution and
delivery of this Agreement and each Credit Event:

7.1. CORPORATE STATUS, ETC. Each of the Borrower and its Subsidiaries (i)
is a duly organized or formed and validly existing corporation, partnership or
limited liability company, as the case may be, in good standing under the laws
of the jurisdiction of its formation and has the corporate, partnership or
limited liability company power and authority, as applicable, to own its
property and assets and to transact the business in which it is engaged and
presently proposes to engage, and (ii) has duly qualified and is authorized to
do business in all jurisdictions where it is required to be so qualified except
where the failure to be so qualified would not have a Material Adverse Effect.

7.2. SUBSIDIARIES. Annex II hereto lists, as of the date hereof, each
Subsidiary of the Borrower (and the direct and indirect ownership interest of
the Borrower therein).

7.3. CORPORATE POWER AND AUTHORITY, ETC. Each Credit Party has the
corporate power and authority to execute, deliver and carry out the terms and
provisions of the Credit Documents to which it is party and has taken all
necessary corporate or other organizational action to authorize the execution,
delivery and performance of the Credit Documents to which it is party. Each
Credit Party has duly executed and delivered each Credit Document to which it is
party and each Credit Document to which it is party constitutes the legal, valid
and binding agreement or obligation of such Credit Party enforceable in
accordance with its terms, except to the extent that the enforceability thereof
may be limited by applicable bankruptcy, insolvency, reorganization, moratorium
or other similar laws generally affecting creditors' rights and by equitable
principles (regardless of whether enforcement is sought in equity or at law).

7.4. NO VIOLATION. Neither the execution, delivery and performance by any
Credit Party of the Credit Documents to which it is party nor compliance with
the terms and provisions thereof (i) will contravene any provision of any law,
statute, rule, regulation, order, writ, injunction or decree of any court or
governmental instrumentality applicable to such Credit Party or its properties
and assets, (ii) will conflict with or result in any breach of, any of the
terms, covenants, conditions or provisions of, or constitute a default under, or
result in the creation or imposition of (or the obligation to create or impose)
any Lien upon any of the property or assets of such Credit Party pursuant to the
terms of any promissory note, bond, debenture, indenture, mortgage, deed of
trust, credit or loan agreement, or any other material agreement or other
instrument, to which such Credit Party is a party or by which it or any of its
property or assets are bound or affected, or (iii) will violate any provision of
the certificate or articles of incorporation, code of regulations or by-laws, or
other charter documents of such Credit Party.

7.5. GOVERNMENTAL APPROVALS. No order, consent, approval, license,
authorization, or validation of, or filing, recording or registration with, or
exemption by, any Governmental Authority, is required to authorize or is
required as a condition to (i) the execution, delivery and performance by any
Credit Party of any Credit Document to which it is a party, or (ii) the
legality, validity, binding effect or enforceability of any Credit Document to
which any Credit Party is a party.

7.6. LITIGATION. There are no actions, suits or proceedings pending or, to,
the knowledge of the Borrower, threatened with respect to the Borrower or any of
its Subsidiaries (i) that have, or could reasonably be expected to have, a
Material Adverse Effect, or (ii) which question the validity or enforceability
of any of the Credit Documents, or of any action to be taken by any Credit Party
pursuant to any of the Credit Documents to which it is a party.

7.7. USE OF PROCEEDS; MARGIN REGULATIONS. (a) The proceeds of all Loans
shall be utilized (i) to retire the Indebtedness referred to in sections 6.1(g),
(ii) to finance Acquisitions permitted hereunder, and (iii) for other lawful
purposes not inconsistent with the requirements of this Agreement.

(b) No part of the proceeds of any Credit Event will be used directly or
indirectly to purchase or carry Margin Stock, or to extend credit to others for
the purpose of purchasing or carrying any Margin Stock. Neither any Credit
Event, nor the use of the proceeds thereof, will violate or be inconsistent with
the provisions of Regulation T, U or X of the Board of Governors of the Federal
Reserve System. The Borrower is not engaged in the business of extending credit
for the purpose of purchasing or carrying any Margin Stock. At no time would
more than 25% of the value of the assets of the Borrower or of the Borrower and
its consolidated Subsidiaries that are subject to any "arrangement" (as such
term is used in section 221.2(g) of such Regulation U) hereunder be represented
by Margin Stock.

7.8. FINANCIAL STATEMENTS, ETC. (a) The Borrower has furnished to the
Lenders and the Administrative Agent complete and correct copies of the audited
consolidated balance sheets of the Borrower and its consolidated subsidiaries as
of the end of its fiscal years ended on or nearest to January 31, 1999 and
January 31, 1998, and the related audited consolidated statements of income,
stockholders' equity, and cash flows for the fiscal years then ended,

accompanied by the unqualified report thereon of the Borrower's independent
accountants. All such financial statements have been prepared in accordance with
GAAP, consistently applied (except as stated therein), and fairly present the
financial position of the Borrower and its consolidated subsidiaries as of the
respective dates indicated and the consolidated results of their operations and
cash flows for the respective periods indicated.

(b) The Borrower has received consideration which is the reasonable
equivalent value of the obligations and liabilities that the Borrower has
incurred to the Administrative Agent and the Lenders. The Borrower now has
capital sufficient to carry on its business and transactions and all business
and transactions in which it is about to engage and is now solvent and able to
pay its debts as they mature and the Borrower, as of the Closing Date, owns
property having a value, both at fair valuation and at present fair salable
value, greater than the amount required to pay the Borrower's debts; and the
Borrower is not entering into the Credit Documents with the intent to hinder,
delay or defraud its creditors.

(c) The Borrower has delivered or caused to be delivered to the Lenders
prior to the execution and delivery of this Agreement (i) a copy of the
Borrower's Report on Form 10-K as filed (without Exhibits) with the SEC for its
fiscal year ended on or nearest to January 31, 1998, and any Amendment thereto
filed with the SEC prior to such execution and delivery (as so amended, the
"1998 FORM 10-K"), which Form 10-K contains a general description of the
business and affairs of the Borrower and its Subsidiaries, and (ii) financial
projections prepared by management of the Borrower for the Borrower and its
Subsidiaries for the fiscal years 2000-2004 (the "FINANCIAL PROJECTIONS"). The
Financial Projections were prepared on behalf of the Borrower in good faith
after taking into account the existing and historical levels of business
activity of the Borrower and its Subsidiaries, known trends, including general
economic trends, and all other information, assumptions and estimates considered
by management of the Borrower and its Subsidiaries to be pertinent thereto. The
Financial Projections were considered by management of the Borrower, as of such
date of preparation, to be realistically achievable; PROVIDED, that no
representation or warranty, express or implied, is made as to the impact of
future general economic conditions or as to whether the Borrower's projected
consolidated results as set forth in the Financial Projections will actually be
realized. No facts are known to the Borrower at the date hereof which, if
reflected in the Financial Projections, would result in a material adverse
change in the assets, liabilities, results of operations or cash flows reflected
therein.

7.9. NO MATERIAL ADVERSE CHANGE. Since January 31, 1998, there has been no
change in the condition, business or affairs of the Borrower and its
Subsidiaries taken as a whole, or their properties and assets considered as an
entirety, except for changes, none of which, individually or in the aggregate,
has had or could reasonably be expected to have, a Material Adverse Effect.

7.10. TAX RETURNS AND PAYMENTS. Each of the Borrower and each of its
Subsidiaries has filed all federal income tax returns and all other material tax
returns, domestic and foreign, required to be filed by it and has paid all
material taxes and assessments payable by it which have become due, other than
those not yet delinquent and except for those contested in good faith. The
Borrower and each of its Subsidiaries has established on its books such charges,
accruals and reserves in respect of taxes, assessments, fees and other
governmental charges for all fiscal periods as are required by GAAP. The
Borrower knows of no proposed assessment for additional federal, foreign or
state taxes for any period, or of any basis therefor, which, individually or in
the aggregate, taking into account such charges, accruals and reserves in
respect thereof as the Borrower and its Subsidiaries have made, could reasonably
be expected to have a Material Adverse Effect.

7.11. TITLE TO PROPERTIES, ETC. The Borrower and each of its Subsidiaries
has good and marketable title, in the case of real property, and good title (or
valid Leaseholds, in the case of any leased property), in the case of all other
property, to all of its properties and assets free and clear of Liens other than
Liens permitted by section 9.3. The interests of the Borrower and each of its
Subsidiaries in the properties reflected in the most recent balance sheet
referred to in section 7.8, taken as a whole, were sufficient, in the judgment
of the Borrower, as of the date of such balance sheet for purposes of the
ownership and operation of the businesses conducted by the Borrower and such
Subsidiaries.

7.12. LAWFUL OPERATIONS, ETC. The Borrower and each of its Subsidiaries (i)
holds all necessary federal, state and local governmental licenses,
registrations, certifications, permits and authorizations necessary to conduct
its business, including, without limitation, those required under Environmental
Laws, and (ii) is in full compliance with all material requirements imposed by
law, regulation or rule, whether federal, state or local, which are applicable
to it, its operations, or its properties and assets, including without
limitation, applicable requirements of Environmental Laws, EXCEPT in any case
referred to in the foregoing clause (i) or (ii) for any failure to obtain and
maintain in effect, or noncompliance, which, individually or in the aggregate,
could not reasonably be expected to have a Material Adverse Effect.

7.13. ENVIRONMENTAL MATTERS. Except with respect to any matters that,
individually or in the aggregate, could not reasonably be expected to have a
Material Adverse Effect, neither the Borrower nor any of its Subsidiaries (i)
has become subject to any Environmental Liability, (ii) has received any written
notice or claim with respect to any Environmental Liability, or (iii) knows of
any basis for any Environmental Liability.

7.14. COMPLIANCE WITH ERISA. Compliance by the Borrower with the provisions
hereof and Credit Events contemplated hereby will not involve any prohibited
transaction within the meaning of ERISA or section 4975 of the Code. The
Borrower and each of its Subsidiaries, (i) has fulfilled all obligations under
minimum funding standards of ERISA and the Code with respect to each Plan that
is not a Multiemployer Plan or a Multiple Employer Plan, (ii) has satisfied all
respective contribution obligations in respect of each Multiemployer Plan and
each Multiple Employer Plan, (iii) is in compliance in all material respects
with all other applicable provisions of ERISA and the Code with respect to each
Plan, each Multiemployer Plan and each Multiple Employer Plan, and (iv) has not
incurred any liability under the Title IV of ERISA to the PBGC with respect to
any Plan, any Multiemployer Plan, any Multiple Employer Plan, or any trust
established thereunder. No Plan or trust created thereunder has been terminated,
and there have been no Reportable Events, with respect to any Plan or trust
created thereunder or with respect to any Multiemployer Plan or Multiple
Employer Plan, which termination or Reportable Event will or could result in the
termination of such Plan, Multiemployer Plan or Multiple Employer Plan and give
rise to a material liability of the Borrower or any ERISA Affiliate in respect
thereof. Neither the Borrower nor any ERISA Affiliate is at the date hereof, or
has been at any time within the two years preceding the date hereof, an employer
required to contribute to any Multiemployer Plan or Multiple Employer Plan, or a
"contributing sponsor" (as such term is defined in section 4001 of ERISA) in any
Multiemployer Plan or Multiple Employer Plan. Neither the Borrower nor any ERISA
Affiliate has any contingent liability with respect to any post-retirement
"welfare benefit plan" (as such term is defined in ERISA) except as has been
disclosed to the Lenders in writing.

7.15. INTELLECTUAL PROPERTY, ETC. The Borrower and each of its Subsidiaries
has obtained or has the right to use all material patents, trademarks,
servicemarks, trade names, copyrights, licenses and other rights with respect to
the foregoing necessary for the present and planned future conduct of its
business, without any known conflict with the rights of others, EXCEPT for such
patents, trademarks, servicemarks, trade names, copyrights, licenses and rights,
the loss of which, and such conflicts, which in any such case individually or in
the aggregate could not reasonably be expected to have a Material Adverse
Effect.

7.16. INVESTMENT COMPANY ACT, ETC. Neither the Borrower nor any of its
Subsidiaries is subject to regulation with respect to the creation or incurrence
of Indebtedness under the Investment Company Act of 1940, as amended, the
Interstate Commerce Act, as amended, the Federal Power Act, as amended, the
Public Utility Holding Company Act of 1935, as amended, or any applicable state
public utility law.

7.17. LABOR RELATIONS. Neither the Borrower nor any of its Subsidiaries (i)
is a party to any labor dispute affecting any bargaining unit or other group of
employees generally, (ii) is subject to any material strike, slow down, workout
or other concerted interruptions of operations by employees of the Borrower or
any Subsidiary, whether or not relating to any labor contracts, (iii) is subject
to any significant pending or, to the knowledge of the Borrower, threatened,
unfair labor practice complaint, before the National Labor Relations Board, and
(iv) is subject to any significant pending or, to the knowledge of the Borrower,
threatened, grievance or significant arbitration proceeding arising out of or
under any collective bargaining agreement, (v) is subject to any significant
pending or, to the knowledge of the Borrower, threatened, significant strike,
labor dispute, slowdown or stoppage, or (vi) is, to the

knowledge of the Borrower, involved or subject to any union representation
organizing or certification matter with respect to the employees of the Borrower
or any of its Subsidiaries, EXCEPT (with respect to any matter specified in any
of the above clauses), for such matters as, individually or in the aggregate,
could not reasonably be expected to have a Material Adverse Effect.

7.18. EXISTING INDEBTEDNESS. Annex III sets forth a true and complete list,
as of the date or dates set forth therein, of all Indebtedness of the Borrower
and each of its Subsidiaries, on a consolidated basis, which (i) has an
outstanding principal amount of at least $2,000,000, or may be incurred pursuant
to existing commitments or lines of credit, or (ii) which has an outstanding
principal amount of at least $100,000 and is secured by any Lien on any property
of the Borrower or any Subsidiary, and which will be outstanding on the Closing
Date after giving effect to the initial Borrowing hereunder, other than the
Indebtedness created under the Credit Documents (all such Indebtedness, whether
or not in a principal amount meeting such threshold and required to be so listed
on Annex III, herein the "EXISTING INDEBTEDNESS"). The Borrower has provided to
the Administrative Agent prior to the date of execution hereof true and complete
copies (or summary descriptions) of all agreements and instruments governing the
Indebtedness listed on Annex III (the "EXISTING INDEBTEDNESS AGREEMENTS").

7.19. YEAR 2000 COMPUTER MATTERS. Any reprogramming required to permit the
proper functioning, in and following the year 2000, of (i) the Borrower's and
its Subsidiaries' computer systems and (ii) equipment containing embedded
microchips (including systems and equipment supplied by others or with which
Borrower's or any of its Subsidiary's systems interface) and the testing of all
such systems and equipment, as so reprogrammed, will be completed by December 1,
1999. The cost to the Borrower and its Subsidiaries of such reprogramming and
testing and of the reasonably foreseeable consequences of year 2000 to the
Borrower and its Subsidiaries (including, without limitation, reprogramming
errors and the failure of others' systems or equipment) will not result in an
Event of Default or a Material Adverse Effect. Except for such of the
reprogramming referred to in the preceding sentence as may be necessary, the
computer and management information systems of the Borrower and its Subsidiaries
are and, with ordinary course upgrading and maintenance, will continue to be,
sufficient to permit the Borrower and its Subsidiaries to conduct theirs
business without Material Adverse Effect.

7.20. TRUE AND COMPLETE DISCLOSURE. All factual information (taken as a
whole) heretofore or contemporaneously furnished by or on behalf of the Borrower
or any of its Subsidiaries in writing to the Administrative Agent or any Lender
for purposes of or in connection with this Agreement or any transaction
contemplated herein, other than the Financial Projections (as to which
representations are made only as provided in section 7.8), is, and all other
such factual information (taken as a whole) hereafter furnished by or on behalf
of such person in writing to any Lender will be, true and accurate in all
material respects on the date as of which such information is dated or certified
and not incomplete by omitting to state any material fact necessary to make such
information (taken as a whole) not misleading at such time in light of the
circumstances under which such information was provided, except that any such
future information consisting of financial projections prepared by management of
the Borrower is only represented herein as being based on good faith estimates
and assumptions believed by such persons to be reasonable at the time made. The
Lenders recognize that such projections as to future events are not to be viewed
as facts and that actual results during the period or periods covered by any
such projections may differ materially from the projected results. As of the
Effective Date, there is no fact known to the Borrower or any of its
Subsidiaries which has, or could reasonably be expected to have, a Material
Adverse Effect which has not theretofore been disclosed in writing to the
Lenders.

SECTION 8. AFFIRMATIVE COVENANTS.

The Borrower hereby covenants and agrees that on the Effective Date and
thereafter for so long as this Agreement is in effect and until such time as the
Total Commitment has been terminated, no Loans or Letters of Credit remain
outstanding and all interest, Fees and all other Obligations incurred hereunder
are paid in full:

8.1. REPORTING REQUIREMENTS. The Borrower will furnish to each Lender and
the Administrative Agent:

(a) ANNUAL FINANCIAL STATEMENTS. As soon as available and in any
event within 90 days after the close of each fiscal year of the Borrower,
the consolidated balance sheets of the Borrower and its consolidated
Subsidiaries as at the end of such fiscal year and the related consolidated
statements of income, of stockholder's equity and of cash flows for such
fiscal year, in each case setting forth comparative figures for the
preceding fiscal year, all in reasonable detail and accompanied by the
opinion with respect to such consolidated financial statements of
independent public accountants of recognized national standing selected by
the Borrower, which opinion shall be unqualified and shall (i) state that
such accountants audited such consolidated financial statements in
accordance with generally accepted auditing standards, that such
accountants believe that such audit provides a reasonable basis for their
opinion, and that in their opinion such consolidated financial statements
present fairly, in all material respects, the consolidated financial
position of the Borrower and its consolidated subsidiaries as at the end of
such fiscal year and the consolidated results of their operations and cash
flows for such fiscal year in conformity with generally accepted accounting
principles, or (ii) contain such statements as are customarily included in
unqualified reports of independent accountants in conformity with the
recommendations and requirements of the American Institute of Certified
Public Accountants (or any successor organization).

(b) QUARTERLY FINANCIAL STATEMENTS. As soon as available and in any
event within 45 days after the close of each of the quarterly accounting
periods in each fiscal year of the Borrower, the unaudited condensed
consolidated balance sheets of the Borrower and its consolidated
Subsidiaries as at the end of such quarterly period and the related
unaudited condensed consolidated statements of income and of cash flows for
such quarterly period, and setting forth, in the case of such unaudited
consolidated statements of income and of cash flows, comparative figures
for the related periods in the prior fiscal year, and which consolidated
financial statements shall be certified on behalf of the Borrower by the
Chief Financial Officer or other Authorized Officer of the Borrower,
subject to changes resulting from normal year-end audit adjustments.

(c) OFFICER'S COMPLIANCE CERTIFICATES. At the time of the delivery
of the financial statements provided for in sections 8.1(a) and (b), a
certificate on behalf of the Borrower of the Chief Financial Officer or
other Authorized Officer of the Borrower to the effect that, to the best
knowledge of the Borrower, no Default or Event of Default exists or, if any
Default or Event of Default does exist, specifying the nature and extent
thereof, which certificate shall set forth the calculations required to
establish compliance with the provisions of sections 9.6 through 9.10,
inclusive of this Agreement, including an identification of the amounts of
any financial items of persons or business units acquired by the Borrower
for any periods prior to the date of acquisition which are used in making
such calculations.

(d) ANNUAL BUDGETS AND FORECASTS. Not later than 30 days prior to
the commencement of any fiscal year of the Borrower and its Subsidiaries, a
consolidated budget in reasonable detail for each of fiscal quarter in such
fiscal year, and (if and to the extent prepared by management of the
Borrower) for any subsequent fiscal years, as customarily prepared by
management for its internal use, setting forth, with appropriate
discussion, the forecasted balance sheet, income statement, operating cash
flows and Consolidated Capital Expenditures of the Borrower and its
Subsidiaries for the period covered thereby, and the principal assumptions
upon which forecasts and budget are based.

(e) NOTICE OF DEFAULT, LITIGATION OR ADVERSE CHANGE IN RELATIONSHIP
WITH SUPPLIERS. Promptly, and in any event within three Business Days, in
the case of clause (i) below, or five Business Days, in the case of clause
(ii) or (iii) below, after the Borrower or any of its Subsidiaries obtains
knowledge thereof, notice of

(i) the occurrence of any event which constitutes a Default
or Event of Default, which notice shall specify the nature thereof,
the period of existence thereof and what action the Borrower
proposes to take with respect thereto,

(ii) any litigation or governmental or regulatory
investigation or proceeding pending against or involving the
Borrower or any of its Subsidiaries which could reasonably be
expected to have a Material Adverse Effect, and

(iii) any significant adverse change (in the Borrower's
reasonable judgment) in the Borrower's or any Subsidiary's
relationship with, or any significant event or circumstance which is
in the Borrower's reasonable judgment likely to adversely affect the
Borrower's or any Subsidiary's relationship with, any supplier which
is material to the operations of the Borrower and its Subsidiaries
considered as an entirety.

(f) ERISA. Promptly, and in any event within 10 days after the
Borrower, any Subsidiary of the Borrower or any ERISA Affiliate knows of
the occurrence of any of the following, the Borrower will deliver to each
of the Lenders a certificate on behalf of the Borrower of an Authorized
Officer of the Borrower setting forth the full details as to such
occurrence and the action, if any, that the Borrower, such Subsidiary or
such ERISA Affiliate is required or proposes to take, together with any
notices required or proposed to be given to or filed with or by the
Borrower, the Subsidiary, the ERISA Affiliate, the PBGC, a Plan participant
or the Plan administrator with respect thereto:

(i) that a Reportable Event has occurred with respect to
any Plan;

(ii) the institution of any steps by the Borrower, any ERISA
Affiliate, the PBGC or any other person to terminate any Plan;

(iii) the institution of any steps by the Borrower or any
Subsidiary to withdraw from any Multiemployer Plan or Multiple
Employer Plan, if such withdrawal could result in withdrawal
liability (as described in Part 1 of Subtitle E of Title IV of
ERISA) in excess of $1,000,000;

(iv) the institution of any steps by the Borrower or any
ERISA Affiliate to withdraw from any Plan, if such withdrawal could
result in withdrawal liability in excess of $1,000,000;

(v) a non-exempt "prohibited transaction" within the
meaning of section 406 of ERISA in connection with any Plan;

(vi) that a Plan has an Unfunded Current Liability exceeding
$3,000,000;

(vii) any material increase in the contingent liability of
the Borrower or any Subsidiary with respect to any post-retirement
welfare liability; or

(viii) the taking of any action by, or the threatening of
the taking of any action by, the Internal Revenue Service, the
Department of Labor or the PBGC with respect to any of the
foregoing.

(g) ENVIRONMENTAL MATTERS. Promptly upon, and in any event within 10
Business Days after, an officer of the Borrower obtains actual knowledge
thereof, notice of any of the following environmental matters which
involves any reasonable likelihood (in the Borrower's reasonable judgment)
of resulting in a Material Adverse Effect: (i) any pending or threatened
(in writing) claim that the Borrower or any of its Subsidiaries or any Real
Property owned or operated by the Borrower or any of its Subsidiaries has
any Environmental Liability; (ii) any condition or occurrence on or arising
from any Real Property owned or operated by the Borrower or any of its
Subsidiaries that (A) results in noncompliance by the Borrower or any of
its Subsidiaries with any applicable Environmental Law or (B) would
reasonably be expected to form the basis of a claim that the Borrower or
any of its Subsidiaries or any such Real Property has any Environmental
Liability; (iii) any condition or occurrence on any Real Property owned,
leased or operated by the Borrower or any of its Subsidiaries that could
reasonably be expected to cause such Real Property to be subject to any

restrictions on the ownership, occupancy, use or transferability by the
Borrower or any of its Subsidiaries of such Real Property under any
Environmental Law; and (iv) the taking of any removal or remedial action in
response to the actual or alleged presence of any Hazardous Material on any
Real Property owned, leased or operated by the Borrower or any of its
Subsidiaries as required by any Environmental Law or any governmental or
other administrative agency. All such notices shall describe in reasonable
detail the nature of the Environmental Claim and the Borrower's or such
Subsidiary's response thereto.

(h) SEC REPORTS AND REGISTRATION STATEMENTS. Promptly upon
transmission thereof or other filing with the SEC, copies of all
registration statements (other than the exhibits thereto and any
registration statement on Form S-8 or its equivalent) and annual, quarterly
or current reports that the Borrower or any of its Subsidiaries files with
the SEC on Forms 10-K, 10-Q or 8-K (or any successor forms).

(i) ANNUAL AND QUARTERLY REPORTS, PROXY STATEMENTS AND OTHER REPORTS
DELIVERED TO STOCKHOLDERS GENERALLY. Promptly after transmission thereof to
its stockholders, copies of all annual, quarterly and other reports and all
proxy statements that the Borrower furnishes to its stockholders generally.

(j) AUDITORS' INTERNAL CONTROL COMMENT LETTERS, ETC. Promptly upon
receipt thereof, a copy of each letter or memorandum commenting on internal
accounting controls and/or accounting or financial reporting policies
followed by the Borrower and/or any of its Subsidiaries, which is submitted
to the Borrower by its independent accountants in connection with any
annual or interim audit made by them of the books of the Borrower or any of
its Subsidiaries.

(k) PRESS RELEASES. Promptly after the release thereof to any news
organization or news distribution organization, copies of any press
releases and other similar statements intended to be made available
generally by the Borrower or any of its Subsidiaries to the public
concerning material developments relating to the Borrower or any of its
Subsidiaries.

(l) OTHER INFORMATION. With reasonable promptness, such other
information or documents (financial or otherwise) relating to the Borrower
or any of its Subsidiaries as any Lender may reasonably request from time
to time.

8.2. BOOKS, RECORDS AND INSPECTIONS. The Borrower will, and will cause each
of its Subsidiaries to, (i) keep proper books of record and account, in which
full and correct entries shall be made of all financial transactions and the
assets and business of the Borrower or such Subsidiaries, as the case may be, in
accordance with GAAP, in the case of the Borrower, or which are reconcilable to
a GAAP presentation, in the case of any Subsidiary; and (ii) permit, upon at
least two Business Days' notice to the Chief Financial Officer or any other
Authorized Officer of the Borrower, officers and designated representatives of
the Administrative Agent or any of the Lenders to visit and inspect any of the
properties or assets of the Borrower and any of its Subsidiaries in whomsoever's
possession (but only to the extent the Borrower or such Subsidiary has the right
to do so to the extent in the possession of another person), and to examine (and
make copies of or take extracts from) the books of account of the Borrower and
any of its Subsidiaries and discuss the affairs, finances and accounts of the
Borrower and of any of its Subsidiaries with, and be advised as to the same by,
its and their officers and independent accountants and independent actuaries, if
any, all at such reasonable times and intervals and to such reasonable extent as
the Administrative Agent or any of the Lenders may request.

8.3. INSURANCE. The Borrower will, and will cause each of its Subsidiaries
to, (i) maintain insurance coverage by such insurers and in such forms and
amounts and against such risks as are generally consistent with the insurance
coverage maintained by the Borrower and its Subsidiaries at the date hereof, and
(ii) forthwith upon any Lender's written request, furnish to such Lender such
information about such insurance as such Lender may from time to time reasonably
request, which information shall be prepared in form and detail satisfactory to
such Lender and certified by an Authorized Officer of the Borrower.

8.4. PAYMENT OF TAXES AND CLAIMS. The Borrower will pay and discharge, and
will cause each of its Subsidiaries to pay and discharge, all taxes, assessments
and governmental charges or levies imposed upon it or upon its income or
profits, or upon any properties belonging to it, prior to the date on which
penalties attach thereto, and all lawful claims which, if unpaid, might become a
Lien or charge upon any properties of the Borrower or any of its Subsidiaries;
PROVIDED that neither the Borrower nor any of its Subsidiaries shall be required
to pay any such tax, assessment, charge, levy or claim which is being contested
in good faith and by proper proceedings if it has maintained adequate reserves
with respect thereto in accordance with GAAP; and PROVIDED, FURTHER, that the
Borrower will not be considered to be in default of any of the provisions of
this sentence if the Borrower or any Subsidiary fails to pay any such amount
which, individually or in the aggregate, is immaterial to the Borrower and its
Subsidiaries considered as an entirety.

8.5. CORPORATE FRANCHISES. The Borrower will do, and will cause each of its
Subsidiaries to do, or cause to be done, all things necessary to preserve and
keep in full force and effect its corporate or other organizational existence,
rights, authority and franchises, PROVIDED that nothing in this section 8.5
shall be deemed to prohibit (i) any transaction permitted by section 9.2; (ii)
the termination of existence of any Subsidiary if (A) the Borrower determines
that such termination is in its best interest and (B) such termination is not
adverse in any material respect to the Lenders; or (iii) the loss of any rights,
authorities or franchises if the loss thereof, in the aggregate, could not
reasonably be expected to have a Material Adverse Effect.

8.6. GOOD REPAIR. The Borrower will, and will cause each of its
Subsidiaries to, ensure that its material properties and equipment used or
useful in its business in whomsoever's possession they may be, are kept in good
repair, working order and condition, normal wear and tear excepted, and that
from time to time there are made in such properties and equipment all needful
and proper repairs, renewals, replacements, extensions, additions, betterments
and improvements, thereto, to the extent and in the manner customary for
companies in similar businesses.

8.7. COMPLIANCE WITH STATUTES, ETC. The Borrower will, and will cause each
of its Subsidiaries to, comply, in all material respects, with all applicable
statutes, regulations and orders of, and all applicable restrictions imposed by,
all governmental bodies, domestic or foreign, in respect of the conduct of its
business and the ownership of its property, other than those (i) being contested
in good faith by appropriate proceedings, as to which adequate reserves are
established to the extent required under GAAP, and (ii) the noncompliance with
which would not have, and which would not be reasonably expected to have, a
Material Adverse Effect.

8.8. COMPLIANCE WITH ENVIRONMENTAL LAWS. Without limitation of the
covenants contained in section 8.7 hereof:

(a) The Borrower will, and will cause each of its Subsidiaries to,
(i) comply, in all material respects, with all Environmental Laws
applicable to the ownership, lease or use of all Real Property now or
hereafter owned, leased or operated by the Borrower or any of its
Subsidiaries, and promptly pay or cause to be paid all costs and expenses
incurred in connection with such compliance, except for such noncompliance
as would not have, and which would not be reasonably expected to have, a
Material Adverse Effect; and (ii) keep or cause to be kept all such Real
Property free and clear of any Liens imposed pursuant to such Environmental
Laws which are not permitted under section 9.3.

(b) Without limitation of the foregoing, if the Borrower or any of
its Subsidiaries shall generate, use, treat, store, release or dispose of,
or permit the generation, use, treatment, storage, release or disposal of,
Hazardous Materials on any Real Property now or hereafter owned, leased or
operated by the Borrower or any of its Subsidiaries, or transport or permit
the transportation of Hazardous Materials to or from any such Real
Property, any such action shall be effected only in the ordinary course of
business and in any event in compliance, in all material respects, with all
Environmental Laws applicable thereto, except for such noncompliance as
would not have, and which would not be reasonably expected to have, a
Material Adverse Effect.

(c) If required to do so under any applicable order of any
governmental agency, the Borrower will undertake, and cause each of its
Subsidiaries to undertake, any clean up, removal, remedial or other action
necessary to remove and clean up any Hazardous Materials from any Real
Property owned, leased or operated by the Borrower or any of its
Subsidiaries in accordance with, in all material respects, the requirements
of all applicable Environmental Laws and in accordance with, in all
material respects, such orders of all governmental authorities, except (i)
to the extent that the Borrower or such Subsidiary is contesting such order
in good faith and by appropriate proceedings and for which adequate
reserves have been established to the extent required by GAAP, or (ii) for
such noncompliance as would not have, and which would not be reasonably
expected to have, a Material Adverse Effect.

8.9. FISCAL YEARS, FISCAL QUARTERS. The Borrower will, for consolidated
financial reporting purposes, continue to use its current methodology for
determining its fiscal year and fiscal quarters. If the Borrower shall change
any of its Subsidiaries' fiscal years or fiscal quarters (other than the fiscal
year or fiscal quarters of a person which becomes a Subsidiary, made at the time
such person becomes a Subsidiary, to conform to the Borrower's fiscal year and
fiscal quarters or to conform to the fiscal year or fiscal quarters which the
Borrower generally utilizes for its Subsidiaries), the Borrower will promptly,
and in any event within 30 days following any such change, deliver a notice to
the Administrative Agent and the Lenders describing such change and any material
accounting entries made in connection therewith and stating whether such change
will have any impact upon any financial computations to be made hereunder, and
if any such impact is foreseen, describing in reasonable detail the nature and
extent of such impact. If the Required Lenders determine that any such change
will have any impact upon any financial computations to be made hereunder which
is adverse to the Lenders, the Borrower will, if so requested by the
Administrative Agent, enter into an amendment to this Agreement, in form and
substance satisfactory to the Administrative Agent and the Required Lenders,
modifying any of the financial covenants or related provisions hereof in such
manner as the Required Lenders determine is necessary to eliminate such adverse
effect.

8.10. CERTAIN SUBSIDIARIES TO JOIN IN SUBSIDIARY GUARANTY. (a) In the
event that at any time after the Effective Date

(x) the Borrower has any Subsidiary (other than a Foreign Subsidiary
as to which section 8.10(b) applies) which is not a party to the Subsidiary
Guaranty, or

(y) an Event of Default shall have occurred and be continuing and
the Borrower has any Subsidiary which is not a party to the Subsidiary
Guaranty,

the Borrower will notify the Administrative Agent in writing of such event,
identifying the Subsidiary in question and referring specifically to the rights
of the Administrative Agent and the Lenders under this section. The Borrower
will, within 15 days following request therefor from the Administrative Agent
(who may give such request on its own initiative or upon request by the Required
Lenders), cause such Subsidiary to deliver to the Administrative Agent, in
sufficient quantities for the Lenders, (i) a joinder supplement, satisfactory in
form and substance to the Administrative Agent and the Required Lenders, duly
executed by such Subsidiary, pursuant to which such Subsidiary joins in the
Subsidiary Guaranty as a guarantor thereunder, and (ii) if such Subsidiary is a
corporation, resolutions of the Board of Directors of such Subsidiary, certified
by the Secretary or an Assistant Secretary of such Subsidiary as duly adopted
and in full force and effect, authorizing the execution and delivery of such
joinder supplement, or if such Subsidiary is not a corporation, such other
evidence of the authority of such Subsidiary to execute such joinder supplement
as the Administrative Agent may reasonably request.

(b) Notwithstanding the foregoing provisions of this section 8.10, the
Borrower shall not, unless an Event of Default shall have occurred and be
continuing, be required to cause a Foreign Subsidiary to join in the Subsidiary
Guaranty if (i) to do so would subject the Borrower to liability for additional
United States income taxes by virtue of section 956 of the Code in an amount the
Borrower considers material, and (ii) the Borrower provides the Administrative
Agent, within the 30-day period referred to in section 8.10(a), with
documentation, including computations prepared by the Borrower's internal tax
officer, its independent accountants or tax counsel, acceptable to the Required
Lenders, in support thereof.

8.11. HEDGE AGREEMENTS, ETC. In the event the Borrower or any of its
Subsidiaries determines to enter into a Hedge Agreement it may do so, PROVIDED
that the purpose of such Hedge Agreement is to provide protection to the
Borrower or any such Subsidiary from fluctuations and other changes in interest
rates and currency exchange rates, as and to the extent considered reasonably
necessary by the Borrower, but without exposing the Borrower or its Subsidiaries
to predominantly speculative risks unrelated to the amount of assets,
Indebtedness or other liabilities intended to be subject to coverage on a
notional basis under all such Hedge Agreements.

8.12. MOST FAVORED COVENANT STATUS. Should the Borrower at any time after
the Effective Date, issue or guarantee any unsecured Indebtedness denominated in
U.S. dollars for money borrowed or represented by bonds, notes, debentures or
similar securities in an aggregate amount exceeding $10,000,000, to any lender
or group of lenders acting in concert with one another, or one or more
institutional investors, pursuant to a loan agreement, credit agreement, note
purchase agreement, indenture, guaranty or other similar instrument, which
agreement, indenture, guaranty or instrument, includes affirmative or negative
business or financial covenants (or any events of default or other type of
restriction which would have the practical effect of any affirmative or negative
business or financial covenant, including, without limitation, any "put" or
mandatory prepayment of such Indebtedness upon the occurrence of a "change of
control") which are applicable to the Borrower, other than those set forth
herein or in any of the other Credit Documents, the Borrower shall promptly so
notify the Administrative Agent and the Lenders and, if the Administrative Agent
shall so request by written notice to the Borrower (after a determination has
been made by the Required Lenders that any of the above-referenced documents or
instruments contain any such provisions, which either individually or in the
aggregate, are more favorable to the holders of such unsecured Indebtedness than
any of the provisions set forth herein), the Borrower, the Administrative Agent
and the Lenders shall promptly amend this Agreement to incorporate some or all
of such provisions, in the discretion of the Administrative Agent and the
Required Lenders, into this Agreement and, to the extent necessary and
reasonably desirable to the Administrative Agent and the Required Lenders, into
any of the other Credit Documents, all at the election of the Administrative
Agent and the Required Lenders.

8.13. SENIOR DEBT. The Borrower will at all times ensure that (a) the
claims of the Lenders in respect of the Obligations of the Borrower will not be
subordinate to, and will in all respects at least rank PARI PASSU with, the
claims of every other senior unsecured creditor of the Borrower, and (b) any
Indebtedness subordinated in any manner to the claims of any other senior
unsecured creditor of the Borrower will be subordinated in like manner to such
claims of the Lenders.

SECTION 9. NEGATIVE COVENANTS.

9.1. CHANGES IN BUSINESS. Neither the Borrower nor any of its Subsidiaries
will engage in any business if, as a result, the general nature of the business,
taken on a consolidated basis, which would then be engaged in by the Borrower
and its Subsidiaries, would be substantially changed from the business engaged
in by the Borrower and its Subsidiaries on the date hereof.

9.2. CONSOLIDATION, MERGER, ACQUISITIONS, ASSET SALES, ETC. The Borrower
will not, and will not permit any Subsidiary to, (1) wind up, liquidate or
dissolve its affairs, (2) enter into any transaction of merger or consolidation,
(3) make or otherwise effect any Acquisition, (4) sell or otherwise dispose of
any of its property or assets outside the ordinary course of business, or
otherwise make or otherwise effect any Asset Sale, or (5) agree to do any of the
foregoing at any future time, EXCEPT that the following shall be permitted:

(a) CERTAIN INTERCOMPANY MERGERS, ETC. If no Default or Event of
Default shall have occurred and be continuing or would result therefrom,
(i) the merger, consolidation or amalgamation of any Wholly-Owned
Subsidiary with or into the Borrower or another Wholly-Owned Subsidiary, so
long as in

any merger, consolidation or amalgamation involving the Borrower, the
Borrower is the surviving or continuing or resulting corporation, (ii) the
liquidation or dissolution of any Wholly-Owned Subsidiary of the Borrower,
and (iii) the transfer or other disposition of any property by the Borrower
to any Wholly-Owned Subsidiary or by any Wholly-Owned Subsidiary to the
Borrower or any other Wholly-Owned Subsidiary of the Borrower, shall each
be permitted.

(b) PERMITTED ACQUISITIONS. If no Default or Event of Default shall
have occurred and be continuing or would result therefrom, the Borrower or
any Subsidiary may make any Acquisition which is a Permitted Acquisition,
PROVIDED that all of the conditions contained in the definition of the term
Permitted Acquisition are satisfied.

(c) WEST COAST DISTRIBUTION FACILITY. If no Default or Event of
Default shall have occurred and be continuing or would result therefrom,
the Borrower or any of its Subsidiaries may

(i) acquire undeveloped land intended to be improved for, or
developed land intended to be used or improved for, a West Coast
distribution center, and

(ii) if so desired by the Borrower, sell such unimproved or
improved property to a person that is not a Subsidiary of the
Borrower and lease it back from such person pursuant to a Capital
Lease or an Operating Lease; PROVIDED that: (A) the consideration
for sale represents fair value (as determined by management of the
Borrower), and at least 90% of such consideration consists of cash,
and (B) in the case of any such Capital Lease, or any such Operating
Lease which is also a Synthetic Lease, any Indebtedness resulting
from any such sale and leaseback transaction is permitted by section
9.4(d).

(d) PERMITTED DISPOSITIONS. If no Default or Event of Default shall
have occurred and be continuing or would result therefrom, the Borrower or
any of its Subsidiaries may (i) sell any property, land or building
(including any related receivables or other intangible assets) to any
person which is not a Subsidiary of the Borrower, or (ii) sell the entire
capital stock (or other equity interests) and Indebtedness of any
Subsidiary owned by the Borrower or any other Subsidiary to any person
which is not a Subsidiary of the Borrower, or (iii) permit any Subsidiary
to be merged or consolidated with a person which is not an Affiliate of the
Borrower, or (iv) consummate any other Asset Sale with a person who is not
a Subsidiary of the Borrower; PROVIDED that:

(A) the consideration for such transaction represents fair
value (as determined by management of the Borrower), and at least
90% of such consideration consists of cash,

(B) the aggregate consideration for all such transactions
completed during any fiscal year does not exceed 10% of the
Consolidated Total Assets of the Borrower as of the beginning of
such fiscal year;

(C) after giving effect to such transaction, the cumulative
aggregate consideration for all such transactions completed after
the end of the Borrower's fiscal quarter ended on or nearest to
October 31, 1998 does not exceed 25% of the Borrower's Consolidated
Total Assets as of the end of the most recent period for which
financial statements have been delivered to the Lenders hereunder;
and

(D) in the case of any such transaction involving
consideration in excess of $10,000,000, at least five Business Days
prior to the date of completion of such transaction the Borrower
shall have delivered to the Administrative Agent and the Lenders an
officer's certificate executed on behalf of the Borrower by an
Authorized Officer of the Borrower, which certificate shall contain
a description of the proposed transaction, the date such transaction
is scheduled to be consummated, the estimated purchase price or
other consideration for such transaction, financial

information pertaining to compliance with the preceding clauses (A)
and (B), and which shall (if requested by the Administrative Agent)
include a certified copy of the draft or definitive documentation
pertaining thereto.

(e) LEASES. The Borrower or any of its Subsidiaries may enter into
leases of property or assets not constituting Acquisitions, PROVIDED such
leases are not otherwise in violation of this Agreement.

(f) CAPITAL EXPENDITURES: The Borrower and it Subsidiaries shall be
permitted to make any Consolidated Capital Expenditures.

(g) PERMITTED INVESTMENTS. The Borrower and it Subsidiaries
shall be permitted to make the investments permitted pursuant to section
9.5.

9.3. LIENS. The Borrower will not, and will not permit any of its
Subsidiaries to, create, incur, assume or suffer to exist any Lien upon or with
respect to any property or assets of any kind (real or personal, tangible or
intangible) of the Borrower or any such Subsidiary whether now owned or
hereafter acquired, or sell any such property or assets subject to an
understanding or agreement, contingent or otherwise, to repurchase such property
or assets (including sales of accounts receivable or notes with or without
recourse to the Borrower or any of its Subsidiaries, other than for purposes of
collection of delinquent accounts in the ordinary course of business) or assign
any right to receive income, or file or permit the filing of any financing
statement under the UCC or any other similar notice of Lien under any similar
recording or notice statute, EXCEPT that the foregoing restrictions shall not
apply to:

(a) STANDARD PERMITTED LIENS: the Standard Permitted Liens;

(b) EXISTING LIENS, ETC.: Liens (i) in existence on the Effective
Date which are listed, and the Indebtedness secured thereby and the
property subject thereto on the Effective Date described, in Annex IV, or
(ii) arising out of the refinancing, extension, renewal or refunding of any
Indebtedness secured by any such Liens, PROVIDED that the principal amount
of such Indebtedness is not increased and such Indebtedness is not secured
by any additional assets;

(c) PURCHASE MONEY LIENS: Liens (i) which are placed upon fixed or
capital assets, acquired, constructed or improved by the Borrower or any
Subsidiary, PROVIDED that (A) such Liens secure Indebtedness permitted by
section 9.4(e), (B) such Liens and the Indebtedness secured thereby are
incurred prior to or within 180 days after such acquisition or the
completion of such construction or improvement, (C) the Indebtedness
secured thereby does not exceed 100% of the cost of acquiring, constructing
or improving such fixed or capital assets; and (D) such Liens shall not
apply to any other property or assets of the Borrower or any Subsidiary; or
(ii) arising out of the refinancing, extension, renewal or refunding of any
Indebtedness secured by any such Liens, PROVIDED that the principal amount
of such Indebtedness is not increased and such Indebtedness is not secured
by any additional assets; and

(d) LIENS ON ACQUIRED PROPERTIES: any Lien (i) existing on any
property or asset prior to the acquisition thereof by the Borrower or any
Subsidiary, or existing on any property or asset of any person that becomes
a Subsidiary after the date hereof prior to the time such person becomes a
Subsidiary; PROVIDED that (A) such Lien secures Indebtedness permitted by
section 9.4(e), (B) such Lien is not created in contemplation of or in
connection with such acquisition or such person becoming a Subsidiary, as
the case may be, (C) such Lien shall not attach or apply to any other
property or assets of the Borrower or any Subsidiary, (D) such Lien shall
secure only those obligations which it secures on the date of such
acquisition or the date such person becomes a Subsidiary, as the case may
be; or (ii) arising out of the refinancing, extension, renewal or refunding
of any Indebtedness secured by any such Liens, PROVIDED that the principal
amount of such Indebtedness is not increased and such Indebtedness is not
secured by any additional assets.

9.4. INDEBTEDNESS. The Borrower will not, and will not permit any of its
Subsidiaries to, contract, create, incur, assume or suffer to exist any
Indebtedness of the Borrower or any of its Subsidiaries, EXCEPT:

(a) CREDIT DOCUMENTS: Indebtedness incurred under this Agreement
and the other Credit Documents;

(b) EXISTING INDEBTEDNESS: Existing Indebtedness; and any
refinancing, extension, renewal or refunding of any such Existing
Indebtedness not involving an increase in the principal amount thereof or a
reduction of more than 10% in the remaining weighted average life to
maturity thereof (computed in accordance with standard financial practice);
PROVIDED that any Existing Indebtedness identified in Annex III or referred
to in section 6.1 as being intended to be refinanced by Loans incurred
hereunder or otherwise retired, may not be otherwise refinanced;

(c) SUBORDINATED NOTES: (i) up to $150,000,000 aggregate principal
amount of Subordinated Notes issued as contemplated by section 6.1(h)
hereof, including any Guaranty Obligations, on a senior subordinated basis,
of Subsidiaries of the Borrower with respect thereto; and (ii) any
subordinated notes and subordinated Guaranty Obligations issued in exchange
therefor pursuant to the Registration Rights Agreement referred to in the
Offering Memorandum identified in section 6.1(h) hereof;

(d) WEST COAST DISTRIBUTION FACILITY: up to $30,000,000 of (i)
Capitalized Lease Obligations, or (ii) present value, determined on the
basis of the implicit interest rate, of all basic rental obligations under
one or more Synthetic Leases, for a new West Coast Distribution Facility
for the Borrower and its Subsidiaries; PROVIDED that at the time of any
incurrence thereof after the date hereof, and after giving effect thereto,
the Borrower would be in compliance with section 9.7, 9.8 and 9.9, and no
Event of Default shall have occurred and be continuing or would result
therefrom;

(e) CERTAIN PRIORITY DEBT: to the extent not permitted by the
foregoing clauses,

(i) Indebtedness consisting of Capital Lease Obligations
of the Borrower and its Subsidiaries,

(ii) Indebtedness consisting of obligations under Synthetic
Leases of the Borrower and its Subsidiaries,

(iii) Indebtedness secured by a Lien referred to in section
9.3(c) or (d), and

(iv) any refinancing, extension, renewal or refunding of any
such Indebtedness not involving an increase in the principal amount
thereof or a reduction of more than 10% in the remaining weighted
average life to maturity thereof (computed in accordance with
standard financial practice),

PROVIDED that (A) at the time of any incurrence thereof after the date
hereof, and after giving effect thereto, the Borrower would be in
compliance with section 9.7, 9.8 and 9.9, and no Event of Default shall
have occurred and be continuing or would result therefrom; and (B) the
aggregate outstanding principal amount (using Capitalized Lease Obligations
in lieu of principal amount, in the case of any Capital Lease, and using
the present value, based on the implicit interest rate, in lieu of
principal amount, in the case of any Synthetic Lease) of Indebtedness
permitted by this clause (e), when taken together with any outstanding
Indebtedness permitted by clause (b) above which is represented by a
Capital Lease or a Synthetic Lease or which is secured by any Lien, shall
not exceed 10% of the Borrower's Consolidated Net Worth as of the end of
the most recent fiscal period for which financial statements have been
delivered to the Lenders hereunder;

(f) INTERCOMPANY DEBT: Indebtedness of the Borrower to any of its
Subsidiaries, and Indebtedness of any of the Borrower's Subsidiaries to the
Borrower or to another Subsidiary of the Borrower, in each case as
permitted by section 9.5;

(g) HEDGE AGREEMENTS: Indebtedness of the Borrower and its
Subsidiaries under Hedge Agreements; and

(h) ADDITIONAL UNSECURED DEBT AND GUARANTY OBLIGATIONS: additional
unsecured Indebtedness of the Borrower (including additional unsecured
Guaranty Obligations of the Borrower), not in excess of $30,000,000
aggregate principal amount outstanding at any time, PROVIDED that at the
time of incurrence thereof, and after giving effect thereto, (i) the
Borrower would be in compliance with sections 9.7, 9.8 and 9.9; (ii) no
Event of Default shall have occurred and be continuing or would result
therefrom; and (iii) the Consolidated Total Balance Sheet Debt does not
exceed $350,000,000.

9.5. ADVANCES, INVESTMENTS, LOANS AND GUARANTY OBLIGATIONS. The Borrower
will not, and will not permit any of its Subsidiaries to, (1) lend money or
credit or make advances to any person, (2) purchase or acquire any stock,
obligations or securities of, or any other interest in, or make any capital
contribution to, or other investment in, any person, (3) create, acquire or hold
any Subsidiary, (4) be or become a party to any joint venture or partnership, or
(5) be or become obligated under any Guaranty Obligations (other than those
created in favor of the Lenders pursuant to the Credit Documents), EXCEPT:

(a) the Borrower or any of its Subsidiaries may invest in cash
and Cash Equivalents;

(b) any endorsement of a check or other medium of payment for
deposit or collection, or any similar transaction in the normal course of
business;

(c) the Borrower and its Subsidiaries may acquire and hold
receivables owing to them in the ordinary course of business and payable or
dischargeable in accordance with customary trade terms;

(d) investments acquired by the Borrower or any of its Subsidiaries
(i) in exchange for any other investment held by the Borrower or any such
Subsidiary in connection with or as a result of a bankruptcy, workout,
reorganization or recapitalization of the issuer of such other investment,
or (ii) as a result of a foreclosure by the Borrower or any of its
Subsidiaries with respect to any secured investment or other transfer of
title with respect to any secured investment in default;

(e) loans and advances to employees for business-related travel
expenses, moving expenses, costs of replacement homes, business machines or
supplies, automobiles and other similar expenses, in each case incurred in
the ordinary course of business, shall be permitted;

(f) existing investments in any Subsidiaries (and any increases
thereof attributable to increases in retained earnings), and existing loans
and advances to any Subsidiary;

(g) to the extent not permitted by the foregoing clauses, the
existing loans, advances, investments and guarantees described on Annex V
hereto;

(h) any unsecured Guaranty Obligations permitted by section 9.4;

(i) investments of the Borrower and its Subsidiaries in Hedge
Agreements;

(j) loans and advances by any Subsidiary of the Borrower to the
Borrower, PROVIDED that the Indebtedness represented thereby constitutes
Subordinated Indebtedness;

(k) to the extent not permitted by the foregoing clauses, loans and
advances by the Borrower or by any Subsidiary of the Borrower to, or other
investments in, any Subsidiary of the Borrower which is a Subsidiary
Guarantor;

(l) the Acquisitions permitted by section 9.2;

(m) loans, advances and investments of any person which are
outstanding at the time such person becomes a Subsidiary of the Borrower as
a result of an Acquisition permitted by section 9.2, but not any increase
in the amount thereof;

(n) additional investments of up to $15,000,000 made after the end
of the Borrower's fiscal quarter ended on or nearest to October 31, 1998 in
Bouclair, Inc., PROVIDED that at the time of making any such additional
investment no Event of Default shall have occurred and be continuing, or
would result therefrom;

(o) additional investments of up to $5,000,000 made after the end of
the Borrower's fiscal quarter ended on or nearest to October 31, 1998 in
The Country Sampler Store, L.L.C., PROVIDED that at the time of making any
such additional investment no Event of Default shall have occurred and be
continuing, or would result therefrom; and

(p) any other loans, advances, investments (whether in the form of
cash or contribution of property, and if in the form of a contribution of
property, such property shall be valued for purposes of this clause at the
fair value thereof as reasonably determined by the Borrower), in or to any
corporation, partnership, limited liability company, joint venture or other
business entity, not otherwise permitted by the foregoing clauses, made
after the end of the most recent fiscal quarter of the Borrower for which
financial statements were furnished to the Lenders prior to the Effective
Date (such loans, advances and investments, collectively, "BASKET
INVESTMENTS"), PROVIDED that (i) at the time of making any such Basket
Investment no Event of Default shall have occurred and be continuing, or
would result therefrom, and (ii) the maximum cumulative amount of Basket
Investments which are so made and outstanding at any time shall not exceed
an aggregate of $20,000,000, taking into account the repayment of any loans
or advances comprising such Basket Investments.

9.6. MINIMUM CONSOLIDATED NET WORTH. The Borrower will not permit its
Consolidated Net Worth as of the end of any fiscal quarter to be less than
$225,000,000, EXCEPT that

(a) effective as of the end of the Borrower's fiscal quarter ended
on or nearest to April 30, 1999, and as of the end of each fiscal quarter
thereafter, the foregoing amount (as it may from time to time be increased
as herein provided), shall be increased by 50% of the Consolidated Net
Income of the Borrower and its Subsidiaries for the fiscal quarter ended on
such date, if any, as determined in conformity with GAAP (there being no
reduction in the case of any such Consolidated Net Income which reflects a
deficit),

(b) the foregoing amount (as it may from time to time be increased
as herein provided), shall be increased by an amount equal to 100% of the
cash proceeds (net of underwriting discounts and commissions and other
customary fees and costs associated therewith) from any sale or issuance of
equity (other than Redeemable Stock) by the Borrower after the end of the
Borrower's fiscal quarter ended on or nearest to October 31, 1998 (other
than any sale or issuance to management or employees pursuant to employee
benefit plans of general application),

(c) the foregoing amount (as it may from time to time be increased
as herein provided), shall be increased by an amount equal to 100% of (x)
the principal amount of Indebtedness or (y) the higher of stated value or
liquidation value of Redeemable Stock, as the case may be, held by any
person other than the Borrower or any of its Subsidiaries, which is
converted or exchanged after the end of the Borrower's fiscal quarter ended
on or nearest to October 31, 1998 into common stock of the Borrower or any
of its Subsidiaries, and

(d) the foregoing amount (as it may from time to time be increased
as herein provided), shall be increased by an amount equal to 100% of the
increase in Consolidated Net Worth attributable to the issuance of common
stock or other equity interests subsequent to the end of the Borrower's
fiscal quarter ended on or nearest to October 31, 1998 as consideration in
any Acquisitions permitted under section 9.2.

9.7. SENIOR LEVERAGE RATIO. The Borrower will not permit the ratio of (i)
the amount of its Consolidated Total Senior Balance Sheet Debt as of the end of
any fiscal quarter, TO (ii) its Consolidated Total Capital as of the end of such
fiscal quarter, to exceed (i) .25 to 1.00 as of the end of the first fiscal
quarter of any fiscal year, (ii) .30 to 1.00 as of the end of the second fiscal
quarter of any fiscal year, (iii) .40 to 1.00 as of the end of the third fiscal
quarter of any fiscal year, or (iv) .20 to 1.00 as of the end of the fourth
fiscal quarter of any fiscal year.

9.8. TOTAL LEVERAGE RATIO. The Borrower will not permit the ratio of (i)
the amount of its Consolidated Total Balance Sheet Debt as of the end of any
fiscal quarter, TO (ii) its Consolidated Total Capital as of the end of such
fiscal quarter, to exceed the ratio specified below for such fiscal quarter:

------------------------------------------------------------------------------
FQ1 FQ2 FQ3 FQ4
OF SUCH FY OF SUCH FY OF SUCH FY OF SUCH FY
------------------------------------------------------------------------------

Fiscal .50 to 1.00 .55 to 1.00 .60 to 1.00 .45 to 1.00
Year 2000
------------------------------------------------------------------------------
Fiscal .45 to 1.00 .55 to 1.00 .55 to 1.00 .45 to 1.00
Year 2001
------------------------------------------------------------------------------
Any Fiscal .45 to 1.00 .55 to 1.00 .55 to 1.00 .40 to 1.00
Year
thereafter
------------------------------------------------------------------------------

9.9. FIXED CHARGE COVERAGE RATIO. The Borrower will not permit its Fixed
Charge Coverage Ratio for the Testing Period ended on or nearest to January 31,
1999, or for any Testing Period ended thereafter, to be less than 1.50 to 1.00.

9.10. RATIO OF CONSOLIDATED CURRENT ASSETS/CONSOLIDATED CURRENT LIABILITIES
PLUS CONSOLIDATED TOTAL SENIOR BALANCE SHEET DEBT. The Borrower will not permit
the ratio, as of the end of any fiscal quarter, of (i) its Consolidated Current
Assets, TO (ii) the sum of (x) its Current Consolidated Liabilities, PLUS (y)
its Consolidated Total Senior Balance Sheet Debt, to be less than 1.50 to 1.00.

9.11. ANNUAL CLEAN DOWN. The Borrower will not at any time permit its
Consolidated Total Senior Balance Sheet Debt to exceed $85,000,000 on any day
during at least one period of 30 consecutive days during the 12 consecutive
calendar months then most recently ended, PROVIDED that (i) the foregoing amount
(as it may from time to time be increased as herein provided), shall be
increased by $15,000,000 effective as of the last day of each fiscal year,
commencing with the Borrower's fiscal year ended on or nearest to January 31,
2001, and (ii) for purposes of determining the amount of Consolidated Total
Senior Balance Sheet Debt outstanding for any period prior to the Closing Date,
the aggregate principal amount of Subordinated Notes outstanding on the Closing
Date shall be deemed to have refinanced an equivalent principal amount of such
Consolidated Total Senior Balance Sheet Debt.

9.12. LIMITATION ON SUBSIDIARY INDEBTEDNESS. The Borrower will not permit
the aggregate principal amount (using Capitalized Lease Obligation, in the case
of a Capital Lease, or present value, in the case of a Synthetic Lease, in lieu
of principal amount) of Indebtedness of its Subsidiaries (exclusive of (i)
Indebtedness of a Subsidiary owed to the Borrower or another Subsidiary, (ii)
Indebtedness represented by the Subsidiary Guaranty, and (iii) Indebtedness
represented by the senior subordinated guarantees of the Subordinated Notes),
when taken together with (x) Indebtedness of the Borrower permitted by section
9.4(e) and (y) Indebtedness of the Borrower permitted by section 9.4(b) which is
represented by a Capital Lease or a Synthetic Lease or which is secured by any
Lien, to exceed 10% of the Borrower's Consolidated Net Worth as of the end of
the most recent fiscal period for which financial statements have been delivered
to the Lenders hereunder.

9.13. LIMITATION ON CERTAIN RESTRICTIVE AGREEMENTS. The Borrower will not,
and will not permit any of its Subsidiaries to, directly or indirectly, enter
into, incur or permit to exist or become effective, any agreement or other
arrangement that prohibits, restricts or imposes any condition upon (a) the
ability of the Borrower or any Subsidiary to create, incur or suffer to exist
any Lien upon any of its property or assets as security for Indebtedness, or (b)
the ability of any such Subsidiary to pay dividends or make any other
distributions on its capital stock or any other interest or participation in its
profits owned by the Borrower or any Subsidiary of the Borrower, or pay any
Indebtedness owed to the Borrower or a Subsidiary of the Borrower, or to make
loans or advances to the Borrower or any of the Borrower's other Subsidiaries,
or transfer any of its property or assets to the Borrower or any of the
Borrower's other Subsidiaries, EXCEPT for such restrictions existing under or by
reason of (i) applicable law, (ii) this Agreement and the other Credit
Documents, (iii) customary provisions restricting subletting or assignment of
any lease governing a leasehold interest, (iv) customary provisions restricting
assignment of any licensing agreement entered into in the ordinary course of
business, (v) customary provisions restricting the transfer or further
encumbering of assets subject to Liens permitted under section 9.3 (b), (c) or
(d), (vi) restrictions contained in the Existing Indebtedness Agreements as in
effect on the Effective Date (and any similar restrictions contained in any
agreement governing any refinancing or refunding thereof not prohibited by this
Agreement), (vii) restrictions contained in the Subordinated Note Indenture as
in effect on the Closing Date (and any similar restrictions contained in any
indenture governing any refinancing or refunding thereof not prohibited by this
Agreement), (viii) customary restrictions affecting only a Subsidiary of the
Borrower under any agreement or instrument governing any of the Indebtedness of
a Subsidiary permitted pursuant to 9.4, (ix) any document relating to
Indebtedness secured by a Lien permitted by section 9.3, insofar as the
provisions thereof limit grants of junior liens on the assets securing such
Indebtedness, and (x) any Operating Lease or Capital Lease, insofar as the
provisions thereof limit grants of a security interest in, or other assignments
of, the related leasehold interest to any other person.

9.14. PREPAYMENTS AND REFINANCINGS OF OTHER DEBT, ETC. The Borrower will
not, and will not permit any of its Subsidiaries to, make (or give any notice in
respect thereof) any voluntary or optional payment or prepayment or redemption
or acquisition for value of (including, without limitation, by way of depositing
with the trustee with respect thereto money or securities before due for the
purpose of paying when due) or exchange of, or refinance or refund,

(a) any of the Subordinated Notes, OTHER THAN pursuant to the
registered Exchange Offer referred to in the Preliminary Offering
Memorandum identified in section 6.1(h); or

(b) any other Indebtedness of the Borrower or its Subsidiaries which
has an outstanding principal balance (or Capitalized Lease Obligation, in
the case of a Capital Lease, or present value, in the case of a Synthetic
Lease) greater than $1,000,000 (other than the Obligations and intercompany
loans and advances among the Borrower and its Subsidiaries); PROVIDED that
the Borrower or any Subsidiary may refinance or refund any such
Indebtedness if the aggregate principal amount thereof (or Capitalized
Lease Obligation, in the case of a Capital Lease, or present value, in the
case of a Synthetic Lease) is not increased and the weighted average life
to maturity thereof (computed in accordance with standard financial
practice) is not reduced by more than 10%.

9.15. TRANSACTIONS WITH AFFILIATES. The Borrower will not, and will not
permit any Subsidiary to, enter into any transaction or series of transactions
with any Affiliate (other than, in the case of the Borrower, any Subsidiary, and
in the case of a Subsidiary, the Borrower or another Subsidiary) other than in
the ordinary course of business of and pursuant to the reasonable requirements
of the Borrower's or such Subsidiary's business and upon fair and reasonable
terms no less favorable to the Borrower or such Subsidiary than would obtain in
a comparable arm's-length transaction with a person other than an Affiliate,
EXCEPT (i) sales of goods to an Affiliate for use or distribution outside the
United States which in the good faith judgment of the Borrower complies with any
applicable legal requirements of the Code, or (ii) agreements and transactions
with and payments to officers, directors and shareholders which are either (A)
entered into in the ordinary course of business and not prohibited by any of the
provisions of this Agreement, or (B) entered into outside the ordinary course of
business, approved by the directors or shareholders of the Borrower, and not
prohibited by any of the provisions of this Agreement.

9.16. PLAN TERMINATIONS, MINIMUM FUNDING, ETC. The Borrower will not, and
will not permit any ERISA Affiliate to, (i) terminate any Plan or Plans so as to
result in liability of the Borrower or any ERISA Affiliate to the PBGC in excess
of $3,000,000 in the aggregate, (ii) permit to exist one or more events or
conditions which reasonably present a material risk of the termination by the
PBGC of any Plan or Plans with respect to which the Borrower or any ERISA
Affiliate would, in the event of such termination, incur liability to the PBGC
in excess of such amount in the aggregate, or (iii) fail to comply with the
minimum funding standards of ERISA and the Code with respect to any Plan.

SECTION 10. EVENTS OF DEFAULT.

10.1. EVENTS OF DEFAULT. Any of the following specified events shall
constitute an Event of Default (each an "EVENT OF DEFAULT"):

(a) PAYMENTS: the Borrower shall (i) default in the payment when due
of any principal of the Loans, or any reimbursement obligation in respect
of any LC Disbursement; or (ii) default, and such default shall continue
for five or more days, in the payment when due of any interest on the Loans
or any Fees or any other amounts owing hereunder or under any other Credit
Document; or

(b) REPRESENTATIONS, ETC.: any representation, warranty or statement
made by the Borrower or any other Credit Party herein or in any other
Credit Document or in any statement or certificate delivered or required to
be delivered pursuant hereto or thereto shall prove to be untrue in any
material respect on the date as of which made or deemed made; or

(c) CERTAIN NEGATIVE COVENANTS: the Borrower shall default in the
due performance or observance by it of any term, covenant or agreement
contained in sections 9.2 through 9.12, inclusive, of this Agreement; or

(d) OTHER COVENANTS: the Borrower shall default in the due
performance or observance by it of any term, covenant or agreement
contained in this Agreement or any other Credit Document, other than those
referred to in section 10.1(a) or (b) or (c) above, and such default is not
remedied within 30 days after the earlier of (i) an officer of the Borrower
obtaining actual knowledge of such default and (ii) the Borrower receiving
written notice of such default from the Administrative Agent or the
Required Lenders (any such notice to be identified as a "notice of default
" and to refer specifically to this paragraph); or

(e) CROSS DEFAULT UNDER OTHER AGREEMENTS: the Borrower or any of its
Subsidiaries shall (i) default in any payment with respect to any
Indebtedness (other than the Obligations) owed to any Lender, or having an
unpaid principal amount of $5,000,000 or greater, and such default shall
continue after the applicable grace period, if any, specified in the
agreement or instrument relating to such Indebtedness, or (ii) default in
the observance or performance of any agreement or condition relating to any
such Indebtedness or contained in any instrument or agreement evidencing,
securing or relating thereto (and all grace periods applicable to such
observance, performance or condition shall have expired), or any other
event shall occur or condition exist, the effect of which default or other
event or condition is to cause, or to permit the holder or holders of such
Indebtedness (or a trustee or agent on behalf of such holder or holders) to
cause any such Indebtedness to become due prior to its stated maturity; or
any such Indebtedness of the Borrower or any of its Subsidiaries shall be
declared to be due and payable, or shall be required to be prepaid (other
than by a regularly scheduled required prepayment or redemption, prior to
the stated maturity thereof); or

(f) OTHER CREDIT DOCUMENTS: the Subsidiary Guaranty (once executed
and delivered) shall cease for any reason (other than termination in
accordance with its terms) to be in full force and effect; or any Credit
Party shall default in any payment obligation thereunder; or any Credit
Party shall default in any material respect in the due performance and
observance of any other obligation thereunder and such default shall
continue unremedied for a period of at least 30 days after notice by the
Administrative Agent or the

Required Lenders; or any Credit Party shall (or seek to) disaffirm or
otherwise limit its obligations thereunder otherwise than in strict
compliance with the terms thereof; or

(g) JUDGMENTS: one or more judgments or decrees shall be entered
against the Borrower and/or any of its Subsidiaries involving a liability
(other than a liability covered by insurance, as to which the carrier has
adequate claims paying ability and has not reserved its rights) of
$1,000,000 or more in the aggregate for all such judgments and decrees for
the Borrower and its Subsidiaries, and any such judgments or decrees shall
not have been vacated, discharged or stayed or bonded pending appeal within
30 days (or such longer period, not in excess of 60 days, during which
enforcement thereof, and the filing of any judgment lien, is effectively
stayed or prohibited) from the entry thereof; or

(h) BANKRUPTCY, ETC.: the Borrower or any of its Material
Subsidiaries shall commence a voluntary case concerning itself under Title
11 of the United States Code entitled "Bankruptcy," as now or hereafter in
effect, or any successor thereto (the "BANKRUPTCY CODE"); or an involuntary
case is commenced against the Borrower or any of its Material Subsidiaries
and the petition is not controverted within 10 days, or is not dismissed
within 60 days, after commencement of the case; or a custodian (as defined
in the Bankruptcy Code) is appointed for, or takes charge of, all or
substantially all of the property of the Borrower or any of its Material
Subsidiaries; or the Borrower or any of its Material Subsidiaries commences
(including by way of applying for or consenting to the appointment of, or
the taking of possession by, a rehabilitator, receiver, custodian, trustee,
conservator or liquidator (collectively, a "CONSERVATOR") of itself or all
or any substantial portion of its property) any other proceeding under any
reorganization, arrangement, adjustment of debt, relief of debtors,
dissolution, insolvency, liquidation, rehabilitation, conservatorship or
similar law of any jurisdiction whether now or hereafter in effect relating
to the Borrower or any of its Material Subsidiaries; or any such proceeding
is commenced against the Borrower or any of its Material Subsidiaries to
the extent such proceeding is consented by such person or remains
undismissed for a period of 60 days; or the Borrower or any of its Material
Subsidiaries is adjudicated insolvent or bankrupt; or any order of relief
or other order approving any such case or proceeding is entered; or the
Borrower or any of its Material Subsidiaries suffers any appointment of any
conservator or the like for it or any substantial part of its property
which continues undischarged or unstayed for a period of 60 days; or the
Borrower or any of its Material Subsidiaries makes a general assignment for
the benefit of creditors; or any corporate (or similar organizational)
action is taken by the Borrower or any of its Material Subsidiaries for the
purpose of effecting any of the foregoing; or

(i) ERISA: (i) any of the events described in clauses (i) through
(viii) of section 8.1(f) shall have occurred; or (ii) there shall result
from any such event or events the imposition of a lien, the granting of a
security interest, or a liability or a material risk of incurring a
liability; and (iii) any such event or events or any such lien, security
interest or liability, individually, and/or in the aggregate, in the
opinion of the Required Lenders, has had, or could reasonably be expected
to have, a Material Adverse Effect.

10.2. ACCELERATION, ETC. Upon the occurrence of any Event of Default, and
at any time thereafter, if any Event of Default shall then be continuing, the
Administrative Agent shall, upon the written request of the Required Lenders, by
written notice to the Borrower, take any or all of the following actions,
without prejudice to the rights of the Administrative Agent or any Lender to
enforce its claims against the Borrower or any other Credit Party in any manner
permitted under applicable law:

(a) declare the Total Commitment terminated, whereupon the
Commitment of each Lender shall forthwith terminate immediately without any
other notice of any kind;

(b) declare the principal of and any accrued interest in respect of
all Loans, all LC Disbursements which remain unreimbursed, and all other
Obligations owing hereunder and under the other Credit Documents to be,
whereupon the same shall become, forthwith due and payable without
presentment, demand, protest or other notice of any kind, all of which are
hereby waived by the Borrower;

(d) direct the Borrower to pay (and the Borrower hereby agrees that
on receipt of such notice or upon the occurrence of an Event of Default
with respect to the Borrower under section 10.1(h), it will pay) to the
Administrative Agent an amount of cash equal to 100% of the aggregate
Stated Amount of all Letters of Credit then outstanding, with such amount
to be held as security for the Borrower's (and any Subsidiary which is an
account party) reimbursement and payment obligations in respect thereof;
and/or

(e) exercise any other right or remedy available under any of the
Credit Documents or applicable law;

PROVIDED that, if an Event of Default specified in section 10.1(h) shall occur
with respect to the Borrower, the result which would occur upon the giving of
written notice by the Administrative Agent as specified in clauses (a) and/or
(b) above shall occur automatically without the giving of any such notice.

10.3. APPLICATION OF LIQUIDATION PROCEEDS. All monies received by the
Administrative Agent or any Lender from the exercise of remedies hereunder or
under the other Credit Documents or under any other documents relating to this
Agreement shall, unless otherwise required by the terms of the other Credit
Documents or by applicable law, be applied as follows:

(i) FIRST, to the payment of all expenses (to the extent not paid by
the Borrower) incurred by the Administrative Agent and the Lenders in
connection with the exercise of such remedies, including, without
limitation, all reasonable costs and expenses of collection, attorneys'
fees, court costs and any foreclosure expenses;

(ii) SECOND, to the payment PRO RATA of interest then accrued on the
outstanding Loans;

(iii) THIRD, to the payment PRO RATA of any Fees then accrued and
payable to the Administrative Agent, any Issuing Bank or any Lender under
this Agreement in respect of the Loans or the Total LC Exposure;

(iv) FOURTH, to the payment PRO RATA of (A) the principal balance on
the outstanding Loans, (B) the amount of the LC Disbursements which remain
unreimbursed, and (C) the Stated Amount of all Letters of Credit which are
outstanding (to be held and applied by the Administrative Agent as security
for the reimbursement obligations in respect thereof);

(v) FIFTH, to the payment to the Lenders of any amounts then accrued
and unpaid under sections 2.8, 2.9, 3.7 and 5.4 hereof, and if such
proceeds are insufficient to pay such amounts in full, to the payment of
such amounts PRO RATA;

(vi) SIXTH, to the payment PRO RATA of all other amounts owed by the
Borrower to the Administrative Agent, to any Issuing Bank or any Lender
under this Agreement or any other Credit Document, and if such proceeds are
insufficient to pay such amounts in full, to the payment of such amounts
PRO RATA; and

(vii) FINALLY, any remaining surplus after all of the Obligations
have been paid in full, to the Borrower or to whomsoever shall be lawfully
entitled thereto.

SECTION 11. THE ADMINISTRATIVE AGENT.

11.1. APPOINTMENT. Each Lender hereby irrevocably designates and appoints
KeyBank as Administrative Agent to act as specified herein and in the other
Credit Documents, and each such Lender hereby irrevocably

authorizes KeyBank as the Administrative Agent for such Lender, to take such
action on its behalf under the provisions of this Agreement and the other Credit
Documents and to exercise such powers and perform such duties as are expressly
delegated to the Administrative Agent by the terms of this Agreement and the
other Credit Documents, together with such other powers as are reasonably
incidental thereto. The Administrative Agent agrees to act as such upon the
express conditions contained in this section 11. Notwithstanding any provision
to the contrary elsewhere in this Agreement, the Administrative Agent shall not
have any duties or responsibilities, except those expressly set forth herein or
in the other Credit Documents, nor any fiduciary relationship with any Lender,
and no implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or otherwise exist against the
Administrative Agent. The provisions of this section 11 are solely for the
benefit of the Administrative Agent, and the Lenders, and the Borrower and its
Subsidiaries shall not have any rights as a third party beneficiary of any of
the provisions hereof. In performing its functions and duties under this
Agreement, the Administrative Agent shall act solely as agent of the Lenders and
does not assume and shall not be deemed to have assumed any obligation or
relationship of agency or trust with or for the Borrower or any of its
Subsidiaries.

11.2. DELEGATION OF DUTIES. The Administrative Agent may execute any
of its duties under this Agreement or any other Credit Document by or through
agents or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. The Administrative Agent
shall not be responsible for the negligence or misconduct of any agents or
attorneys-in-fact selected by it with reasonable care except to the extent
otherwise required by section 11.3.

11.3. EXCULPATORY PROVISIONS. Neither the Administrative Agent nor any of
its respective officers, directors, employees, agents, attorneys-in-fact or
affiliates shall be (i) liable for any action lawfully taken or omitted to be
taken by it or such person under or in connection with this Agreement (except
for its or such person's own gross negligence or willful misconduct) or (ii)
responsible in any manner to any of the Lenders for any recitals, statements,
representations or warranties made by the Borrower or of its Subsidiaries or any
of their respective officers contained in this Agreement, any other Credit
Document or in any certificate, report, statement or other document referred to
or provided for in, or received by the Administrative Agent under or in
connection with, this Agreement or any other Credit Document or for any failure
of the Borrower or any Subsidiary of the Borrower or any of their respective
officers to perform its obligations hereunder or thereunder. The Administrative
Agent shall not be under any obligation to any Lender to ascertain or to inquire
as to the observance or performance of any of the agreements contained in, or
conditions of, this Agreement, or to inspect the properties, books or records of
the Borrower or any of its Subsidiaries. The Administrative Agent shall not be
responsible to any Lender for the effectiveness, genuineness, validity,
enforceability, collectibility or sufficiency of this Agreement or any Credit
Document or for any representations, warranties, recitals or statements made
herein or therein or made in any written or oral statement or in any financial
or other statements, instruments, reports, certificates or any other documents
in connection herewith or therewith furnished or made by the Administrative
Agent to the Lenders or by or on behalf of the Borrower or any of its
Subsidiaries to the Administrative Agent or any Lender or be required to
ascertain or inquire as to the performance or observance of any of the terms,
conditions, provisions, covenants or agreements contained herein or therein or
as to the use of the proceeds of the Loans or of the existence or possible
existence of any Default or Event of Default.

11.4. RELIANCE BY ADMINISTRATIVE AGENT. The Administrative Agent shall be
entitled to rely, and shall be fully protected in relying, upon any note,
writing, resolution, notice, consent, certificate, affidavit, letter, cablegram,
telegram, facsimile transmission, telex or teletype message, statement, order or
other document or conversation believed by it, in good faith, to be genuine and
correct and to have been signed, sent or made by the proper person or persons
and upon advice and statements of legal counsel (including, without limitation,
counsel to the Borrower or any of its Subsidiaries), independent accountants and
other experts selected by the Administrative Agent. The Administrative Agent
shall be fully justified in failing or refusing to take any action under this
Agreement or any other Credit Document unless it shall first receive such advice
or concurrence of the Required Lenders as it deems appropriate or it shall first
be indemnified to its satisfaction by the Lenders against any and all liability
and expense which may be incurred by it by reason of taking or continuing to
take any such action. The Administrative Agent shall in all cases be fully
protected in acting, or in refraining from acting, under this Agreement and the
other Credit Documents in accordance with a request of the Required Lenders (or
all of the Lenders, as to any matter which,

pursuant to section 12.12, can only be effectuated with the consent of all
Lenders), and such request and any action taken or failure to act pursuant
thereto shall be binding upon all the Lenders.

11.5. NOTICE OF DEFAULT. The Administrative Agent shall not be deemed to
have knowledge or notice of the occurrence of any Default or Event of Default
hereunder unless the Administrative Agent has received notice from a Lender or
the Borrower referring to this Agreement, describing such Default or Event of
Default and stating that such notice is a "notice of default". In the event that
the Administrative Agent receives such a notice, the Administrative Agent shall
give prompt notice thereof to the Lenders. The Administrative Agent shall take
such action with respect to such Default or Event of Default as shall be
reasonably directed by the Required Lenders, PROVIDED that unless and until the
Administrative Agent shall have received such directions, the Administrative
Agent may (but shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Default or Event of Default as it shall
deem advisable in the best interests of the Lenders.

11.6. NON-RELIANCE. Each Lender expressly acknowledges that neither the
Administrative Agent nor any of its officers, directors, employees, agents,
attorneys-in-fact or Affiliates have made any representations or warranties to
it and that no act by the Administrative Agent hereinafter taken, including any
review of the affairs of the Borrower or any of its Subsidiaries, shall be
deemed to constitute any representation or warranty by the Administrative Agent
to any Lender. Each Lender represents to the Administrative Agent that it has,
independently and without reliance upon the Administrative Agent, or any other
Lender, and based on such documents and information as it has deemed
appropriate, made its own appraisal of and investigation into the business,
assets, operations, property, financial and other conditions, prospects and
creditworthiness of the Borrower and its Subsidiaries and made its own decision
to make its Loans hereunder and enter into this Agreement. Each Lender also
represents that it will, independently and without reliance upon the
Administrative Agent, or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Agreement, and to make such investigation as it deems necessary to inform
itself as to the business, assets, operations, property, financial and other
conditions, prospects and creditworthiness of the Borrower and its Subsidiaries.
The Administrative Agent shall not have any duty or responsibility to provide
any Lender with any credit or other information concerning the business,
operations, assets, property, financial and other conditions, prospects or
creditworthiness of the Borrower or any of its Subsidiaries which may come into
the possession of the Administrative Agent or any of its officers, directors,
employees, agents, attorneys-in-fact or Affiliates.

11.7. INDEMNIFICATION. The Lenders agree to indemnify the Administrative
Agent in its capacity as such ratably according to their respective Commitments,
from and against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, reasonable expenses or
disbursements of any kind whatsoever which may at any time (including, without
limitation, at any time following the payment of the Obligations) be imposed on,
incurred by or asserted against the Administrative Agent in its capacity as such
in any way relating to or arising out of this Agreement or any other Credit
Document, or any documents contemplated by or referred to herein or the
transactions contemplated hereby or any action taken or omitted to be taken by
the Administrative Agent under or in connection with any of the foregoing, but
only to the extent that any of the foregoing is not paid by the Borrower,
PROVIDED that no Lender shall be liable to the Administrative Agent for the
payment of any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements to the
extent resulting solely from the Administrative Agent's gross negligence or
willful misconduct. If any indemnity furnished to the Administrative Agent for
any purpose shall, in the opinion of the Administrative Agent, be insufficient
or become impaired, the Administrative Agent may call for additional indemnity
and cease, or not commence, to do the acts indemnified against until such
additional indemnity is furnished. The agreements in this section 11.7 shall
survive the payment of all Obligations.

11.8. THE ADMINISTRATIVE AGENT IN INDIVIDUAL CAPACITY. The Administrative
Agent and its Affiliates may make loans to, accept deposits from and generally
engage in any kind of business with the Borrower, its Subsidiaries and their
Affiliates as though not acting as Administrative Agent hereunder. With respect
to the Loans made by it and all Obligations owing to it, the Administrative
Agent shall have the same rights and powers under this

Agreement as any Lender and may exercise the same as though it were not the
Administrative Agent, and the terms "Lender" and "Lenders" shall include the
Administrative Agent in its individual capacity.

11.9. SUCCESSOR ADMINISTRATIVE AGENT. The Administrative Agent may resign
as the Administrative Agent upon 20 Business Days' notice to the Lenders and the
Borrower. The Administrative Agent may be removed for cause as the
Administrative Agent upon 20 Business Days' notice to the Administrative Agent
and the Borrower from the Required Lenders, which notice shall specify the
conduct constituting the cause for removal. The Required Lenders shall appoint
from among the Lenders a successor Administrative Agent for the Lenders subject
to prior approval by the Borrower (such approval not to be unreasonably withheld
or delayed), whereupon such successor agent shall succeed to the rights, powers
and duties of the Administrative Agent, and the term "Administrative Agent"
shall include such successor agent effective upon its appointment, and the
resigning or removed Administrative Agent's rights, powers and duties as the
Administrative Agent shall be terminated, without any other or further act or
deed on the part of such former Administrative Agent or any of the parties to
this Agreement. After the retiring Administrative Agent's resignation or removal
hereunder as the Administrative Agent, the provisions of this section 11 shall
inure to its benefit as to any actions taken or omitted to be taken by it while
it was Administrative Agent under this Agreement.

11.10. OTHER AGENTS. Any Lender identified herein as a Co-Agent,
Syndication Agent, Documentation Agent, Managing Agent, Manager or any other
corresponding title, other than "Administrative Agent", shall have no right,
power, obligation, liability, responsibility or duty under this Agreement or any
other Credit Document except those applicable to all Lenders as such. Each
Lender acknowledges that it has not relied, and will not rely, on any Lender so
identified in deciding to enter into this Agreement or in taking or not taking
any action hereunder.

SECTION 12. MISCELLANEOUS.

12.1. PAYMENT OF EXPENSES ETC. (a) Whether or not the transactions
contemplated hereby are consummated, the Borrower agrees to pay (or reimburse
the Administrative Agent for) all reasonable out-of-pocket costs and expenses of
the Administrative Agent in connection with the negotiation, preparation,
execution and delivery of the Credit Documents and the documents and instruments
referred to therein, and the syndication of the Commitments provided for herein,
including, without limitation, the reasonable fees and disbursements of Xxxxx,
Day, Xxxxxx & Xxxxx, special counsel to the Administrative Agent.

(b) The Borrower agrees to pay (or reimburse the Administrative Agent for)
all reasonable out-of-pocket costs and expenses of the Administrative Agent in
connection with any amendment, waiver or consent relating to any of the Credit
Documents which is requested by any Credit Party, including, without limitation,
the reasonable fees and disbursements of Xxxxx, Day, Xxxxxx & Xxxxx, special
counsel to the Administrative Agent.

(c) The Borrower agrees to pay (or reimburse the Administrative Agent and
the Lenders for) all reasonable out-of-pocket costs and expenses of the
Administrative Agent and the Lenders in connection with the enforcement of any
of the Credit Documents or the other documents and instruments referred to
therein, including, without limitation, (i) the reasonable fees and
disbursements of Xxxxx, Day, Xxxxxx & Xxxxx, special counsel to the
Administrative Agent, and (ii) the reasonable fees and disbursements of any
individual counsel to any Lender (and any allocated costs of internal counsel).

(d) Without limitation of the preceding section 12.1(c), in the event of
the bankruptcy, insolvency, rehabilitation or other similar proceeding in
respect of the Borrower or any of its Subsidiaries, the Borrower agrees to pay
all costs of collection and defense, including reasonable attorneys' fees in
connection therewith and in connection with any appellate proceeding or
post-judgment action involved therein, which shall be due and payable together
with all required service or use taxes.

(e) The Borrower agrees to pay and hold the Administrative Agent and each
of the Lenders harmless from and against any and all present and future stamp
and other similar taxes with respect to the foregoing matters

and save the Administrative Agent and each of the Lenders harmless from and
against any and all liabilities with respect to or resulting from any delay or
omission (other than to the extent attributable to such Lender) to pay such
taxes.

(f) The Borrower agrees to indemnify the Administrative Agent and each
Lender, its officers, directors, employees, representatives and agents
(collectively, the "INDEMNITEES") from and hold each of them harmless against
any and all losses, liabilities, claims, damages or expenses reasonably incurred
by any of them as a result of, or arising out of, or in any way related to, or
by reason of

(i) any investigation, litigation or other proceeding (whether or
not the Administrative Agent or any Lender is a party thereto) related to
the entering into and/or performance of any Credit Document or the use of
the proceeds of any Loans hereunder or the consummation of any transactions
contemplated in any Credit Document, other than any such investigation,
litigation or proceeding arising out of transactions solely between any of
the Lenders or the Administrative Agent, transactions solely involving the
assignment by a Lender of all or a portion of its Loans and Commitments, or
the granting of participations therein, as provided in this Agreement, or
arising solely out of any examination of a Lender by any regulatory or
other governmental authority having jurisdiction over it, or

(ii) the actual or alleged presence of Hazardous Materials in the
air, surface water or groundwater or on the surface or subsurface of any
Real Property owned, leased or at any time operated by the Borrower or any
of its Subsidiaries, the release, generation, storage, transportation,
handling or disposal of Hazardous Materials at any location, whether or not
owned or operated by the Borrower or any of its Subsidiaries, if the
Borrower or any such Subsidiary could have or is alleged to have any
responsibility in respect thereof, the non-compliance of any such Real
Property with foreign, federal, state and local laws, regulations and
ordinances (including applicable permits thereunder) applicable thereto, or
any Environmental Claim asserted against the Borrower or any of its
Subsidiaries, in respect of any such Real Property,

including, in each case, without limitation, the reasonable documented fees and
disbursements of counsel incurred in connection with any such investigation,
litigation or other proceeding (but excluding any such losses, liabilities,
claims, damages or expenses to the extent incurred by reason of the gross
negligence or willful misconduct of the person to be indemnified or of any other
Indemnitee who is such person or an Affiliate of such person). To the extent
that the undertaking to indemnify, pay or hold harmless any person set forth in
the preceding sentence may be unenforceable because it is violative of any law
or public policy, the Borrower shall make the maximum contribution to the
payment and satisfaction of each of the indemnified liabilities which is
permissible under applicable law.

12.2. RIGHT OF SETOFF. In addition to any rights now or hereafter granted
under applicable law or otherwise, and not by way of limitation of any such
rights, upon the occurrence of an Event of Default, each Lender is hereby
authorized at any time or from time to time, without presentment, demand,
protest or other notice of any kind to the Borrower or to any other person, any
such notice being hereby expressly waived, to set off and to appropriate and
apply any and all deposits (general or special) and any other Indebtedness at
any time held or owing by such Lender (including, without limitation, by
branches, agencies and Affiliates of such Lender wherever located) to or for the
credit or the account of the Borrower against and on account of the Obligations
and liabilities of the Borrower to such Lender under this Agreement or under any
of the other Credit Documents, including, without limitation, all interests in
Obligations of the Borrower purchased by such Lender pursuant to section
12.4(c), and all other claims of any nature or description arising out of or
connected with this Agreement or any other Credit Document, irrespective of
whether or not such Lender shall have made any demand hereunder and although
said Obligations, liabilities or claims, or any of them, shall be contingent or
unmatured.

12.3. NOTICES. Except as otherwise expressly provided herein, all notices
and other communications provided for hereunder shall be in writing (including
telegraphic, telex, facsimile transmission or cable communication) and mailed,
telegraphed, telexed, transmitted, cabled or delivered, if to the Borrower, at
0000 Xxxxxx Xxxx, Xxxxxx, Xxxx 00000, attention: Chief Financial Officer
(facsimile: (000) 000-0000); if to any Lender

at its address specified for such Lender on Annex I hereto; if to the
Administrative Agent, at its Notice Office; or at such other address as shall be
designated by any party in a written notice to the other parties hereto. All
such notices and communications shall be mailed, telegraphed, telexed,
telecopied, or cabled or sent by overnight courier, and shall be effective when
received.

12.4. BENEFIT OF AGREEMENT. (a) GENERAL. This Agreement shall be binding
upon and inure to the benefit of and be enforceable by the parties hereto and
their respective successors and assigns, PROVIDED that the Borrower may not
assign or transfer any of its rights or obligations hereunder without the prior
written consent of all the Lenders, and, PROVIDED, FURTHER, that any assignment
by a Lender of its rights and obligations hereunder shall be effected in
accordance with section 12.4(c).

(b) PARTICIPATIONS. Notwithstanding the foregoing, each Lender may at any
time grant participations in any of its rights hereunder or under any of the
Notes to (x) another Lender that is not a Defaulting Lender or to an Affiliate
of such Lender which is a commercial bank, financial institution or other
"accredited investor" (as defined in SEC Regulation D), or (y) one or more
Eligible Transferees, PROVIDED that in the case of any such participation,

(i) the participant shall not have any rights under this Agreement
or any of the other Credit Documents, including rights of consent, approval
or waiver (the participant's rights against such Lender in respect of such
participation to be those set forth in the agreement executed by such
Lender in favor of the participant relating thereto),

(ii) such Lender's obligations under this Agreement (including,
without limitation, its Commitment hereunder) shall remain unchanged,

(iii) such Lender shall remain solely responsible to the other
parties hereto for the performance of such obligations,

(iv) such Lender shall remain the holder of any Note for all
purposes of this Agreement, and

(v) the Borrower, the Administrative Agent, and the other Lenders
shall continue to deal solely and directly with the selling Lender in
connection with such Lender's rights and obligations under this Agreement,
and all amounts payable by the Borrower hereunder shall be determined as if
such Lender had not sold such participation, except that the participant
shall be entitled to the benefits of sections 2.9 and 2.10 of this
Agreement to the extent that such Lender would be entitled to such benefits
if the participation had not been entered into or sold,

and, PROVIDED FURTHER, that no Lender shall transfer, grant or sell any
participation under which the participant shall have rights to approve any
amendment to or waiver of this Agreement or any other Credit Document except to
the extent such amendment or waiver would (x) extend the final scheduled
maturity of the Loans or Commitment in which such participant is participating,
or extend the expiration date of a Letter of Credit (including any acceptance or
time draft relating thereto) in which such participant is participating beyond
the latest expiration date provided for herein, or extend any date provided
herein for a reimbursement payment by the Borrower (or any other applicable
account party) in respect of an LC Disbursement related to a Letter of Credit in
which such participant is participating, or reduce the rate or extend the time
of payment of interest or Fees on any such Loan, Letter of Credit, LC
Disbursement or Commitment (except in connection with a waiver of the
applicability of any post-default increase in interest rates), or reduce the
principal amount of any such Loan or LC Disbursement, or increase such
participant's participating interest in any Loan, Letter of Credit, LC
Disbursement or Commitment over the amount thereof then in effect (it being
understood that a waiver of any Default or Event of Default shall not constitute
a change in the terms of any such Loan, Letter of Credit, LC Disbursement or
Commitment), (y) release any guarantor from its guaranty of any of the
Obligations, except strictly in accordance with the terms of the Credit
Documents, or (z) consent to the assignment or transfer by the Borrower of any
of its rights or obligations under this Agreement.

(c) ASSIGNMENTS BY LENDERS. Notwithstanding the foregoing, (x) any Lender
may assign all or a fixed portion of its Loans and/or Commitment, and its rights
and obligations hereunder, which assignment does not have to be PRO RATA among
the Facilities, to another Lender that is not a Defaulting Lender, or to an
Affiliate of any Lender (including itself) and which is not a Defaulting Lender
and which is a commercial bank, financial institution or other "accredited
investor" (as defined in SEC Regulation D), and (y) any Lender may assign all,
or if less than all, a fixed portion, equal to at least $10,000,000 in the
aggregate for the assigning Lender or assigning Lenders, of its Loans and/or
Commitment and its rights and obligations hereunder, which assignment does not
have to be PRO RATA among the Facilities, to one or more Eligible Transferees,
each of which assignees shall become a party to this Agreement as a Lender by
execution of an Assignment Agreement, PROVIDED that

(i) the Swing Line Lender may only assign its Swing Line Commitment
and its Swing Line Loans as an entirety and only if the assignee thereof is
or becomes a Lender with a General Revolving Commitment,

(ii) in the case of any assignment of a portion of any Loans and/or
Commitment of a Lender, such Lender shall retain a minimum fixed portion of
all Loans and Commitments equal to at least $10,000,000,

(iii) at the time of any such assignment Annex I shall be deemed
modified to reflect the Commitments of such new Lender and of the existing
Lenders,

(iv) upon surrender of the old Notes, new Notes will be issued to
such new Lender and to the assigning Lender, such new Notes to be in
conformity with the requirements of section 2.4 (with appropriate
modifications) to the extent needed to reflect the revised Commitments,

(v) in the case of clause (y) only, the consent of the
Administrative Agent and each Issuing Bank shall be required in connection
with any such assignment (which consent shall not be unreasonably withheld
or delayed), and

(vi) the Administrative Agent shall receive at the time of each such
assignment (other than an assignment from a Lender to any of its
Affiliates), from the assigning or assignee Lender, the payment of a
non-refundable assignment fee of $3,500,

and, PROVIDED FURTHER, that such transfer or assignment will not be effective
until the Assignment Agreement in respect thereof is recorded by the
Administrative Agent on the Lender Register maintained by it as provided herein.

To the extent of any assignment pursuant to this section 12.4(c) the
assigning Lender shall be relieved of its obligations hereunder with respect to
its assigned Commitments.

At the time of each assignment pursuant to this section 12.4(c) to a person
which is not already a Lender hereunder and which is not a United States person
(as such term is defined in section 7701(a)(30) of the Code) for Federal income
tax purposes, the respective assignee Lender shall provide to the Borrower and
the Administrative Agent the appropriate Internal Revenue Service Forms (and, if
applicable a Section 5.4(b)(ii) Certificate) described in section 5.4(b). To the
extent that an assignment of all or any portion of a Lender's Commitment and
related outstanding Obligations pursuant to this section 12.4(c) would, at the
time of such assignment, result in increased costs under section 2.10 from those
being charged by the respective assigning Lender prior to such assignment, then
the Borrower shall not be obligated to pay such increased costs (although the
Borrower shall be obligated to pay any other increased costs of the type
described above resulting from changes after the date of the respective
assignment).

Nothing in this section 12.4(c) shall prevent or prohibit (x) any Lender
which is a bank or other financial institution from pledging its Notes or Loans
to a Federal Reserve Bank in support of borrowings made by such Lender from such
Federal Reserve Bank, or (y) in the case of any other Lender, from pledging its
Notes or Loans to a trustee

or agent for the holders of certificates or Indebtedness issued by such Lender
which have a rating from Xxxxx'x or S&P acceptable to the Administrative Agent,
acting in its reasonable discretion.

(d) NO SEC REGISTRATION OR BLUE SKY COMPLIANCE. Notwithstanding any other
provisions of this section 12.4, no transfer or assignment of the interests or
obligations of any Lender hereunder or any grant of participation therein shall
be permitted if such transfer, assignment or grant would require the Borrower to
file a registration statement with the SEC or to qualify the Loans under the
"Blue Sky" laws of any State.

(e) REPRESENTATIONS OF LENDERS. Each Lender initially party to this
Agreement hereby represents, and each person that became a Lender pursuant to an
assignment permitted by this section 12.4 will, upon its becoming party to this
Agreement, represent that it is a commercial lender, other financial institution
or other "accredited" investor (as defined in SEC Regulation D) which makes or
acquires loans in the ordinary course of its business and that it will make or
acquire Loans for its own account in the ordinary course of such business,
PROVIDED that subject to the preceding sections 12.4(b) and (c), the disposition
of any promissory notes or other evidences of or interests in Indebtedness held
by such Lender shall at all times be within its exclusive control.

(f) GRANTS BY LENDERS TO SPCS. Notwithstanding anything to the contrary
contained herein, any Lender, (a "GRANTING LENDER") may grant to a special
purpose funding vehicle (an "SPC"), identified as such in writing from time to
time by the Granting Lender to the Administrative Agent, the Borrower and the
other Lenders, the option to provide to the Borrower all or any part of any Loan
that such Granting Lender would otherwise be obligated to make to the Borrower
pursuant to this Agreement; PROVIDED that (i) nothing herein shall constitute a
commitment by any SPC to make any Loan, and (ii) if an SPC elects not to
exercise such option or otherwise fails to provide all or any part of such Loan,
the Granting Lender shall be obligated to make such Loan pursuant to the terms
hereof. The making of a Loan by an SPC hereunder shall utilize the Commitment of
the Granting Lender to the same extent, and as if, such Loan were made by such
Granting Lender. Each party hereto hereby agrees that no SPC shall be liable for
any indemnity or payment under this Agreement for which a Lender would otherwise
be liable for so long as, and to the extent, the Granting Lender provides such
indemnity or makes such payment. In furtherance of the foregoing, each party
hereto hereby agrees (which agreement shall survive the termination of this
Agreement) that, prior to the date that is one year and one day after the
payment in full of all outstanding commercial paper or other senior indebtedness
of any SPC, it will not institute against, or join any other person in
instituting against, such SPC any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceedings under the laws of the United States or any
State thereof. In addition, notwithstanding anything to the contrary contained
in this section 12.4, any SPC may (i) with notice to, but without the prior
written consent of, the Borrower and the Administrative Agent and without paying
any processing fee therefor, assign all or a portion of its interests in any
Loans to the Granting Lender or to any financial institutions providing
liquidity and/or credit support to or for the account of such SPC to support the
funding or maintenance of Loans and (ii) disclose on a confidential basis any
non-public information relating to its Loans to any rating agency, commercial
paper dealer or provider of any surety, guarantee or credit or liquidity
enhancements to such SPC. This section 12.4(f) may not be amended without the
written consent of any Granting Lender affected thereby.

12.5. NO WAIVER: REMEDIES CUMULATIVE. No failure or delay on the part of
the Administrative Agent or any Lender in exercising any right, power or
privilege hereunder or under any other Credit Document and no course of dealing
between the Borrower and the Administrative Agent or any Lender shall operate as
a waiver thereof; nor shall any single or partial exercise of any right, power
or privilege hereunder or under any other Credit Document preclude any other or
further exercise thereof or the exercise of any other right, power or privilege
hereunder or thereunder. The rights and remedies herein expressly provided are
cumulative and not exclusive of any rights or remedies which the Administrative
Agent or any Lender would otherwise have. No notice to or demand on the Borrower
in any case shall entitle the Borrower to any other or further notice or demand
in similar or other circumstances or constitute a waiver of the rights of the
Administrative Agent or the Lenders to any other or further action in any
circumstances without notice or demand.

12.6. PAYMENTS PRO RATA. (a) The Administrative Agent agrees that promptly
after its receipt of each payment from or on behalf of the Borrower in respect
of any Obligations, it shall distribute such payment to the

Lenders (other than any Lender that has expressly waived in writing its right to
receive its PRO RATA share thereof) PRO RATA based upon their respective shares,
if any, of the Obligations with respect to which such payment was received. As
to any such payment received by the Administrative Agent prior to 1:00 P.M.
(local time at the Payment Office) in funds which are immediately available on
such day, the Administrative Agent will use all reasonable efforts to distribute
such payment in immediately available funds on the same day to the Lenders as
aforesaid.

(b) Each of the Lenders agrees that, if it should receive any amount
hereunder (whether by voluntary payment, by realization upon security, by the
exercise of the right of setoff or banker's lien, by counterclaim or cross
action, by the enforcement of any right under the Credit Documents, or
otherwise) which is applicable to the payment of the principal of, or interest
on, the Loans or Fees, of a sum which with respect to the related sum or sums
received by other Lenders is in a greater proportion than the total of such
Obligation then owed and due to such Lender bears to the total of such
Obligation then owed and due to all of the Lenders immediately prior to such
receipt, then such Lender receiving such excess payment shall purchase for cash
without recourse or warranty from the other Lenders an interest in the
Obligations to such Lenders in such amount as shall result in a proportional
participation by all of the Lenders in such amount, PROVIDED that if all or any
portion of such excess amount is thereafter recovered from such Lender, such
purchase shall be rescinded and the purchase price restored to the extent of
such recovery, but without interest.

(c) Notwithstanding anything to the contrary contained herein, the
provisions of the preceding sections 12.6(a) and (b) shall be subject to the
express provisions of this Agreement which require, or permit, differing
payments to be made to Lenders which are not Defaulting Lenders, as opposed to
Defaulting Lenders.

12.7. CALCULATIONS: COMPUTATIONS. (a) The financial statements to be
furnished to the Lenders pursuant hereto shall be made and prepared in
accordance with GAAP consistently applied throughout the periods involved
(except as set forth in the notes thereto or as otherwise disclosed in writing
by the Borrower to the Lenders); PROVIDED, that if at any time the computations
determining compliance with section 9 utilize accounting principles different
from those utilized in the financial statements furnished to the Lenders, such
computations shall set forth in reasonable detail a description of the
differences and the effect upon such computations.

(b) All computations of interest on Prime Rate Loans hereunder shall be
made on the basis of a year or 365 or 366 days, as applicable, and the actual
number of days elapsed. All computations of interest on Eurodollar Loans and of
Facility Fee, Letter of Credit Fees and other Fees hereunder shall be made on
the actual number of days elapsed over a year of 360 days.

12.8. GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE; WAIVER OF JURY
TRIAL. (a) THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE CONSTRUED IN
ACCORDANCE WITH AND BE GOVERNED BY THE LAW OF THE STATE OF OHIO, TO THE FULLEST
EXTENT PERMITTED BY LAW, THE BORROWER HEREBY UNCONDITIONALLY AND IRREVOCABLY
WAIVES ANY CLAIM TO ASSERT THAT THE LAW OF ANY JURISDICTION OTHER THAN THE STATE
OF OHIO GOVERNS THIS AGREEMENT OR ANY OF THE OTHER CREDIT DOCUMENTS. Any legal
action or proceeding with respect to this Agreement or any other Credit Document
may be brought in the Court of Common Pleas of Cuyahoga County, Ohio, or of the
United States for the Northern District of Ohio, and, by execution and delivery
of this Agreement, the Borrower hereby irrevocably accepts for itself and in
respect of its property, generally and unconditionally, the jurisdiction of the
aforesaid courts. The Borrower hereby further irrevocably consents to the
service of process out of any of the aforementioned courts in any such action or
proceeding by the mailing of copies thereof by registered or certified mail,
postage prepaid, to the Borrower at its address for notices pursuant to section
12.3, such service to become effective 30 days after such mailing or at such
earlier time as may be provided under applicable law. Nothing herein shall
affect the right of the Administrative Agent or any Lender to serve process in
any other manner permitted by law or to commence legal proceedings or otherwise
proceed against the Borrower in any other jurisdiction.

(b) The Borrower hereby irrevocably waives any objection which it may now
or hereafter have to the laying of venue of any of the aforesaid actions or
proceedings arising out of or in connection with this Agreement or any other
Credit Document brought in the courts referred to in section 12.8(a) above and
hereby further irrevocably waives and agrees not to plead or claim in any such
court that any such action or proceeding brought in any such court has been
brought in an inconvenient forum.

(c) EACH OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY WAIVES ALL
RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT
OF OR RELATING TO THIS AGREEMENT, THE OTHER CREDIT DOCUMENTS OR THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY.

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

12.10. EFFECTIVENESS. This Agreement shall become effective on the date
(the "EFFECTIVE DATE") on which the Borrower and each of the Lenders shall have
signed a copy hereof (whether the same or different copies) and shall have
delivered the same to the Administrative Agent at the Notice Office of the
Administrative Agent or, in the case of the Lenders, shall have given to the
Administrative Agent telephonic (confirmed in writing), written telex or
facsimile transmission notice (actually received) at such office that the same
has been signed and mailed to it.

12.11. HEADINGS DESCRIPTIVE. The headings of the several sections and other
portions of this Agreement are inserted for convenience only and shall not in
any way affect the meaning or construction of any provision of this Agreement.

12.12. AMENDMENT OR WAIVER. Neither this Agreement, any of the other Credit
Documents, nor any terms hereof or thereof, may be amended, changed, waived,
discharged or terminated UNLESS such amendment, change, waiver, discharge or
termination is in writing signed by the Borrower (or other appropriate Credit
Party) and the Required Lenders, PROVIDED that no such amendment, change,
waiver, discharge or termination shall, without the consent of each Lender
(other than a Defaulting Lender) affected thereby,

(a) extend any maturity date provided for herein applicable to a
Loan or a Commitment, or extend the expiration date of a Letter of Credit
(including any acceptance or time draft relating thereto) beyond the latest
expiration date provided for herein, or extend any date provided herein for
a reimbursement payment by the Borrower (or any other applicable account
party) in respect of an LC Disbursement, or reduce the rate or extend the
time of payment of interest or Fees (other than as a result of waiving the
applicability of any post-default increase in interest rates) on any Loan,
Letter of Credit, LC Disbursement or Commitment, or reduce the principal
amount of any Loan or LC Disbursement, or increase the Commitment of any
Lender over the amount thereof then in effect (it being understood that a
waiver of any Default or Event of Default shall not constitute a change in
the terms of any Commitment of any Lender),

(b) release the Borrower from any obligations as a guarantor of its
Subsidiaries' obligations under any Credit Document,

(c) release any Subsidiary from its obligations as a guarantor of
any of the Obligations, except strictly in accordance with the terms of the
Credit Documents,

(d) change the definition of the term "Change of Control" or any of
the provisions of section 4.3 or 5.2 which are applicable upon a Change of
Control,

(e) amend, modify or waive any provision of this section 12.12, or
section 11.7, 12.1, 12.4, 12.6 or 12.7(b), or any other provision of any of
the Credit Documents pursuant to which the consent or

approval of all Lenders, all Non-Defaulting Lenders, each Lender, each
Non-Defaulting Lender, any single Lender or any single Non-Defaulting
Lender, is by the terms of such provision explicitly required,

(f) reduce the percentage specified in, or otherwise modify, the
definition of Required Lenders, or

(g) consent to the assignment or transfer by the Borrower of any of
its rights and obligations under this Agreement.

No provision of section 3 or 11 may be amended without the consent of (x)
any Issuing Bank adversely affected thereby or (y) the Administrative Agent,
respectively. No provision of section 2.3 may be amended without the consent of
the Swing Line Lender.

12.13. SURVIVAL OF INDEMNITIES. All indemnities set forth herein including,
without limitation, in section 2.8, 2.9, 3.7, 5.4, 11.7 or 12.1 shall survive
the execution and delivery of this Agreement and the making and prepayment or
repayment of the Loans.

12.14. DOMICILE OF LOANS. Each Lender may transfer and carry its Loans at,
to or for the account of any branch office, subsidiary or Affiliate of such
Lender, PROVIDED that the Borrower shall not be responsible for costs arising
under section 2.8 resulting from any such transfer (other than a transfer
pursuant to section 2.10) to the extent not otherwise applicable to such Lender
prior to such transfer.

12.15. CONFIDENTIALITY. Each Lender shall hold all non-public information
obtained pursuant to the requirements of this Agreement in accordance with its
customary procedure for handling confidential information of this nature and in
accordance with safe and sound banking practices. Notwithstanding the foregoing,
any Lender may in any event make disclosures of, and furnish copies of such
information (i) to another Lender; (ii) when reasonably required by any BONA
FIDE transferee or participant in connection with the contemplated transfer of
any Loans or Commitment or participation therein (PROVIDED that each such
prospective transferee and/or participant shall execute an agreement for the
benefit of the Borrower with such prospective transferor Lender and/or
participant containing provisions substantially identical to those contained in
this section 12.15); (iii) to its parent corporation or corporations and its and
their Affiliates, and to its and their auditors and attorneys; and (iv) as
required or requested by any governmental agency or representative thereof or
pursuant to legal process, PROVIDED that, unless specifically prohibited by
applicable law or court order, each Lender shall notify the Borrower of any
request by any governmental agency or representative thereof (other than any
such request in connection with an examination of the financial condition of
such Lender by such governmental agency) for disclosure of any such non-public
information prior to disclosure of such information. In no event shall any
Lender be obligated or required to return any materials furnished by or on
behalf of the Borrower or any of its Subsidiaries. The Borrower hereby agrees
that the failure of a Lender to comply with the provisions of this section 12.15
shall not relieve the Borrower of any of the obligations to such Lender under
this Agreement and the other Credit Documents.

12.16. LENDER REGISTER. The Borrower hereby designates the Administrative
Agent to serve as its agent, solely for purposes of this section 12.16, to
maintain a register (the "LENDER REGISTER") on or in which it will record the
names and addresses of the Lenders, and the Commitments from time to time of
each of the Lenders, the Loans made to the Borrower by each of the Lenders and
each repayment and prepayment in respect of the principal amount of such Loans
of each such Lender. Failure to make any such recordation, or (absent manifest
error) any error in such recordation, shall not affect the Borrower's
obligations in respect of such Loans. With respect to any Lender, the transfer
of the Commitment of such Lender and the rights to the principal of, and
interest on, any Loan made pursuant to such Commitment shall not be effective
until such transfer is recorded on the Lender Register maintained by the
Administrative Agent with respect to ownership of such Commitment and Loans and
prior to such recordation all amounts owing to the transferor with respect to
such Commitment and Loans shall remain owing to the transferor. The registration
of assignment or transfer of all or part of any Commitments and Loans shall be
recorded by the Administrative Agent on the Lender Register only upon the
acceptance by the Administrative Agent of a properly executed and delivered
Assignment Agreement pursuant to section 12.4(c). The Borrower agrees to
indemnify the

Administrative Agent from and against any and all losses, claims, damages and
liabilities of whatsoever nature which may be imposed on, asserted against or
incurred by the Administrative Agent in performing its duties under this section
12.16, except to the extent attributable to the gross negligence or wilful
misconduct of the Administrative Agent. The Lender Register shall be available
for inspection by the Borrower or any Lender at any reasonable time and from
time to time upon reasonable prior notice.

12.17. LIMITATIONS ON LIABILITY OF THE ISSUING BANKS. The Borrower assumes
all risks of the acts or omissions of any beneficiary or transferee of any
Letter of Credit with respect to its use of such Letter of Credit. Neither any
Issuing Bank nor any of its officers or directors shall be liable or responsible
for: (a) the use which may be made of any Letter of Credit or any acts or
omissions of any beneficiary or transferee in connection therewith; (b) the
validity, sufficiency or genuineness of documents, or of any endorsement
thereon, even if such documents should prove to be in any or all respects
invalid, insufficient, fraudulent or forged; (c) payment by a an Issuing Bank
against presentation of documents that do not comply with the terms of a Letter
of Credit, including failure of any documents to bear any reference or adequate
reference to such Letter of Credit; or (d) any other circumstances whatsoever in
making or failing to make payment under any Letter of Credit, EXCEPT that the
Borrower (or a Subsidiary or Affiliate which is the account party in respect of
the Letter of Credit in question) shall have a claim against an Issuing Bank,
and an Issuing Bank shall be liable to the Borrower (or such Subsidiary or
Affiliate), to the extent of any direct, but not consequential, damages suffered
by the Borrower (or such Subsidiary or Affiliate) which the Borrower (or such
Subsidiary or Affiliate) proves were caused by (i) such Issuing Bank's willful
misconduct or gross negligence in determining whether documents presented under
a Letter of Credit comply with the terms of such Letter of Credit, or (ii) such
Issuing Bank's willful failure to make lawful payment under any Letter of Credit
after the presentation to it of documentation strictly complying with the terms
and conditions of such Letter of Credit. In furtherance and not in limitation of
the foregoing, an Issuing Bank may accept documents that appear on their face to
be in order, without responsibility for further investigation.

12.18. GENERAL LIMITATION OF LIABILITY. No claim may be made by the
Borrower, any Lender, the Administrative Agent, any Issuing Bank or any other
person against the Administrative Agent, any Issuing Bank, or any other Lender
or the Affiliates, directors, officers, employees, attorneys or agents of any of
them for any damages other than actual compensatory damages in respect of any
claim for breach of contract or any other theory of liability arising out of or
related to the transactions contemplated by this Agreement or any of the other
Credit Documents, or any act, omission or event occurring in connection
therewith; and each of the Borrower, each Lender, the Administrative Agent and
each Issuing Bank hereby, to the fullest extent permitted under applicable law,
waives, releases and agrees not to xxx or counterclaim upon any such claim for
any special, consequential or punitive damages, whether or not accrued and
whether or not known or suspected to exist in its favor.

12.19. NO DUTY. All attorneys, accountants, appraisers, consultants and
other professional persons (including the firms or other entities on behalf of
which any such person may act) retained by the Administrative Agent or any
Lender with respect to the transactions contemplated by the Credit Documents
shall have the right to act exclusively in the interest of the Administrative
Agent or such Lender, as the case may be, and shall have no duty of disclosure,
duty of loyalty, duty of care, or other duty or obligation of any type or nature
whatsoever to the Borrower, to any of its Subsidiaries, or to any other person,
with respect to any matters within the scope of such representation or related
to their activities in connection with such representation. The Borrower agrees,
on behalf of itself and its Subsidiaries, not to assert any claim or
counterclaim against any such persons with regard to such matters, all such
claims and counterclaims, now existing or hereafter arising, whether known or
unknown, foreseen or unforseeable, being hereby waived, released and forever
discharged.

12.20. LENDERS AND AGENT NOT FIDUCIARY TO BORROWER, ETC. The relationship
among the Borrower and its Subsidiaries, on the one hand, and the Administrative
Agent, each Issuing Bank and the Lenders, on the other hand, is solely that of
debtor and creditor, and the Administrative Agent, each Issuing Bank and the
Lenders have no fiduciary or other special relationship with the Borrower and/or
its Subsidiaries, and no term or provision of any Credit Document, no course of
dealing, no written or oral communication, or other action, shall be construed
so as to deem such relationship to be other than that of debtor and creditor.

12.21. SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations and
warranties herein shall survive the making of Loans and the issuance of Letters
of Credit hereunder, the execution and delivery of this Agreement, the Notes and
the other documents the forms of which are attached as Exhibits hereto, the
issue and delivery of the Notes, any disposition thereof by any holder thereof,
and any investigation made by the Administrative Agent or any Lender or any
other holder of any of the Notes or on its behalf. All statements contained in
any certificate or other document delivered to the Administrative Agent or any
Lender or any holder of any Notes by or on behalf of the Borrower or of its
Subsidiaries pursuant hereto or otherwise specifically for use in connection
with the transactions contemplated hereby shall constitute representations and
warranties by the Borrower hereunder, made as of the respective dates specified
therein or, if no date is specified, as of the respective dates furnished to the
Administrative Agent or any Lender

12.22. INTEREST RATE LIMITATION. Notwithstanding anything herein to the
contrary, if at any time the interest rate applicable to any Loan, together with
all fees, charges and other amounts which are treated as interest on such Loan
under applicable law (collectively the "CHARGES"), shall exceed the maximum
lawful rate (the "MAXIMUM RATE") which may be contracted for, charged, taken,
received or reserved by the Lender holding such Loan in accordance with
applicable law, the rate of interest payable in respect of such Loan hereunder,
together with all Charges payable in respect thereof, shall be limited to the
Maximum Rate and, to the extent lawful, the interest and Charges that would have
been payable in respect of such Loan but were not payable as a result of the
operation of this Section shall be cumulated and the interest and Charges
payable to such Lender in respect of other Loans or periods shall be increased
(but not above the Maximum Rate therefor) until such cumulated amount, together
with interest thereon at the Federal Funds Effective Rate to the date of
repayment, shall have been received by such Lender.

12.23. JUDGMENT CURRENCY. (a) If for the purposes of obtaining judgment in
any court it is necessary to convert a sum due hereunder or under the Notes in
any currency (the "ORIGINAL CURRENCY") into another currency (the "OTHER
CURRENCY") the parties hereto agree, to the fullest extent that they may
effectively do so, that the rate of exchange used shall be that at which in
accordance with normal banking procedures the Administrative Agent could
purchase the Original Currency with the Other Currency at the principal New York
office of a major United States financial institution selected by the
Administrative Agent on the Business Day immediately preceding the date on which
final judgment is rendered.

(b) The obligation of the Borrower in respect of any sum due in the
Original Currency from it to any Lender or the Administrative Agent hereunder or
under the Note held by such Lender shall, notwithstanding any judgment in any
Other Currency, be discharged only to the extent that on the Business Day
following receipt by such Lender or the Administrative Agent (as the case may
be) of any sum adjudged to be so due in such Other Currency such Lender or the
Administrative Agent (as the case may be) may in accordance with normal banking
procedures purchase Dollars with such Other Currency; if the amount of the
Original Currency so purchased is less than the sum originally due to such
Lender or the Administrative Agent (as the case may be) in the Original
Currency, the Borrower agrees, as a separate obligation and notwithstanding any
such judgment, to indemnify such Lender or the Administrative Agent (as the case
may be) against such loss, and if the amount of the Original Currency so
purchased exceeds the sum originally due to any Lender or the Administrative
Agent (as the case may be) in the Original Currency, such Lender or the
Administrative Agent (as the case may be) agrees to remit to the Borrower such
excess.

(c) For purposes of determining the equivalent in one currency of another
currency as provided in this section, such amount shall include any premium and
costs payable in connection with the conversion into or from any currency.

IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart of
this Agreement to be duly executed and delivered as of the date first above
written.

XX-XXX STORES, INC. KEYBANK NATIONAL ASSOCIATION,
INDIVIDUALLY AS A LENDER,
THE ISSUING BANK AND THE
ADMINISTRATIVE AGENT

BY: /S/ XXXXX X. XXXXXX BY: /S/ XXXXXX X. XXXXXXX
---------------------------- ------------------------------
EXECUTIVE VICE PRESIDENT VICE PRESIDENT
& CHIEF FINANCIAL OFFICER

THE FIRST NATIONAL BANK OF CHICAGO, NATIONAL CITY BANK,
INDIVIDUALLY AS A LENDER AND INDIVIDUALLY AS A LENDER AND
AS DOCUMENTATION AGENT AS A CO-AGENT

BY: /S/ XXXXXX X. XXXXXXXX BY: /S/ XXXXX X. CABLE
---------------------------- -------------------------------
TITLE: VICE PRESIDENT TITLE: SENIOR VICE PRESIDENT

COMERICA BANK, FIRSTAR BANK, N. A.
INDIVIDUALLY AS A LENDER AND
AS A CO-AGENT

BY: /S/ XXXXXXX X. JUDGE BY: /S/ XXXXX X. XXXXXXXXXXX
------------------------------ ---------------------------------
TITLE: VICE PRESIDENT TITLE: VICE PRESIDENT

FLEET NATIONAL BANK UNION BANK OF CALIFORNIA, N. A.

BY: /S/ XXXXXX X. X. XXXXXX BY: /S/ XXXXXXX X. XXXXX
----------------------------- ---------------------------------
TITLE: S. V. P. TITLE: VICE PRESIDENT

XXXXXX TRUST AND SAVINGS BANK MERCANTILE BANK NATIONAL ASSOCIATION

BY: /S/ XXXXX XXXXXXXX BY: /S/ XXXXXXX X. XXXXX
----------------------------- ---------------------------------
TITLE: VICE PRESIDENT TITLE: VICE PRESIDENT

MELLON BANK, N. A. THE HUNTINGTON NATIONAL BANK

BY: /S/ XXXXXXX X. XXXXXX BY: /S/ XXXXXXX X. XXXX
----------------------------- ---------------------------------
TITLE: FIRST VICE PRESIDENT TITLE: V. P.

THE FIFTH THIRD BANK

BY: /S/ X. X. XXXXXXX
-----------------------------
TITLE: V. P.

ANNEX I

INFORMATION AS TO LENDERS

NAME OF LENDER COMMITMENT DOMESTIC LENDING OFFICE EURODOLLAR LENDING OFFICE
-------------------------------------------------------------------------------------------------------------------------

KeyBank National KeyBank National Association KeyBank National Association
Association GENERAL REVOLVING 000 Xxxxxx Xxxxxx 000 Xxxxxx Xxxxxx
XXXXXXXXXX: Xxxxxxxxx, Xxxx 00000 Xxxxxxxxx, Xxxx 00000

$55,000,000 PRIMARY CONTACT:
Xxxxxx X. Xxxxxxx
SWING LINE Vice President
COMMITMENT: Telephone: (000) 000-0000
Facsimile: (000) 000-0000

$5,000,000 CONTACT FOR BORROWINGS,
PAYMENTS, ETC.:
Xxxxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000

WIRING INFORMATION:
ABA No. 041 001 039
Ref.: Xx-Xxx Stores, Inc.
Attention: Commercial Loan
Operations
--------------------------------------------------------------------------------------------------------------------------
The First National Bank The First National Bank of Chicago The First National Bank of
of Chicago One First National Plaza Chicago
GENERAL REVOLVING 14th Floor, Suite 0086 One First National Plaza
COMMITMENT: Xxxxxxx, Xxxxxxxx 00000 00xx Xxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000

$50,000,000 PRIMARY CONTACT:
Xxxxxx Xxxxxxxx
Tel.: (000) 000-0000
Xxxxx Xxxxxxxx
Tel.: (000) 000-0000
Facsimile: (000) 000-0000

CONTACT FOR BORROWINGS,
PAYMENTS, ETC.:

WIRING INFORMATION:
ABA No.
Ref.: Xx-Xxx Stores, Inc.
Attention: Commercial Loan
Operations

NAME OF LENDER COMMITMENT DOMESTIC LENDING OFFICE EURODOLLAR LENDING OFFICE
----------------------------------------------------------------------------------------------------------------------------

National City Bank National City Bank National City Bank
GENERAL REVOLVING 0000 Xxxx Xxxxx Xxxxxx 0000 Xxxx Xxxxx Xxxxxx
XXXXXXXXXX: Xxxxxxxxx, Xxxx 00000 Xxxxxxxxx, Xxxx 00000

PRIMARY CONTACT:
$30,000,000 Xxxxx X. Cable
Senior Vice President
Tel. : (000) 000-0000
Fax.: (000) 000-0000

CONTACT FOR BORROWINGS,
PAYMENTS, ETC.:
Xxx Xxx Xxxxxxxx
Tel.: (000) 000-0000
Fax.: (000) 000-0000

WIRING INFORMATION:
ABA Xx. 000 00 000
X/X Xx. 000000
Ref.: Xx-Xxx Stores, Inc.
Attention: Commercial Loan
Operations
----------------------------------------------------------------------------------------------------------------------------
Comerica Bank Comerica Bank Comerica Bank
GENERAL REVOLVING 000 Xxxxxxxx Xxxxxx 000 Xxxxxxxx Xxxxxx
XXXXXXXXXX: Xxxxxxx, Xxxxxxxx 00000 Xxxxxxx, Xxxxxxxx 00000

$30,000,000 PRIMARY CONTACT:
Xxxx Xxxxx
Tel.: (000) 000-0000
Fax.: (000) 000-0000

CONTACT FOR BORROWINGS,
PAYMENTS, ETC.:
Xxxxxx McVeigligh
Tel.: (000) 000-0000
Fax.: (000) 000-0000

WIRING INFORMATION:
ABA No. 072 000 096
Ref.: Xx-Xxx Stores, Inc.
Attention: Commercial Loan Operations

Fleet National Bank Fleet National Bank Fleet National Bank
GENERAL REVOLVING Xxx Xxxxxxx Xxxxxx Xxx Xxxxxxx Xxxxxx
COMMITMENT: Xxxxxx, Xxxxxxxxxxxxx 00000-0000 Xxxxxx, Xxxxxxxxxxxxx 00000-0000

$20,000,000 PRIMARY CONTACT:
Xxxxxx Xxxxxx
Tel.: (000) 000-0000
Fax.: (000) 000-0000

CONTACT FOR BORROWINGS,
PAYMENTS, ETC.:

WIRING INFORMATION:
ABA No. 011 000 138
Ref.: Xx-Xxx Stores, Inc.
Attention: Commercial Loan
Operations
--------------------------------------------------------------------------------------------------------------------------
Xxxxxx Trust and Xxxxxx Trust and Savings Bank Xxxxxx Trust and Savings Bank
Savings Bank GENERAL REVOLVING 000 Xxxx Xxxxxx Xxxxxx 000 Xxxx Xxxxxx Xxxxxx
XXXXXXXXXX: Xxxxxxx, Xxxxxxxx 00000 Xxxxxxx, Xxxxxxxx 00000

$20,000,000 PRIMARY CONTACT:
Xxxxx Xxxxxxxx
Corporate Banking --10W
Tel.: (000) 000-0000
Fax.: (000) 000-0000

CONTACT FOR BORROWINGS,
PAYMENTS, ETC.:

WIRING INFORMATION:
ABA No. 071 000 028
Ref.: Xx-Xxx Stores, Inc.
Attention: Commercial Loan Operations

Mellon Bank, Mellon Bank, X. X. Xxxxxx Bank, N. A.
N. A. GENERAL REVOLVING Three Mellon Bank Center, Room 0000 Xxxxx Xxxxxx Xxxx Xxxxxx, Xxxx 0000
COMMITMENT: Xxxxxxxxxx, Xxxxxxxxxxxx 00000-0000 Xxxxxxxxxx, Xxxxxxxxxxxx 00000-0000

$20,000,000 PRIMARY CONTACT:
Xxxxxxx X. Xxxxxxx
Tel.: (000) 000-0000
Fax.: (000) 000-0000

CONTACT FOR BORROWINGS,
PAYMENTS, ETC.:
Xxxxx Xxxxxx
Tel.: (000) 000-0000
Fax.: (000) 000-0000

WIRING INFORMATION:
ABA No. 043 000 261
A/C No. 990873800
Ref.: Xx-Xxx Stores, Inc.
Attention: Commercial Loan
Operations

--------------------------------------------------------------------------------------------------------------------------------
The Fifth Third Bank The Fifth Third Bank The Fifth Third Bank
GENERAL REVOLVING 0000 Xxxx Xxxxx Xxxxxx 0000 Xxxx Xxxxx Xxxxxx
XXXXXXXXXX: Xxxxxxxxx, Xxxx 00000 Xxxxxxxxx, Xxxx 00000

$15,000,000 PRIMARY CONTACT:
Xxx Xxxxxxx
Tel.: (000) 000-0000
Fax.: (000) 000-0000

CONTACT FOR BORROWINGS,
PAYMENTS, ETC.:
Xxxxxx Xxxxxx, Credit Dep't.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000

WIRING INFORMATION:
ABA No. 042 000 314
Ref.: Xx-Xxx Stores, Inc.
Attention: Commercial Loan Operations

Firstar Bank, Firstar Bank, N. A. Firstar Bank, N. A.
N. A. GENERAL REVOLVING 0000 Xxxxxx Xxxxxx, 0xx Xxxxx 0000 Xxxxxx Xxx.
XXXXXXXXXX: Xxxxxxxxx, Xxxx 00000 Xxxxxxx, Xxxxxxxxx 00000

$15,000,000 PRIMARY CONTACT:

Xxxxx X. Xxxxxxxxxxx
Tel.: (000) 000-0000
Fax.: (000) 000-0000

CONTACT FOR BORROWINGS,
PAYMENTS, ETC.:

WIRING INFORMATION:
ABA No. 042 000 013
A/C No. 9901893
Ref.: Xx-Xxx Stores, Inc.
Attention: Commercial Loan Operations
----------------------------------------------------------------------------------------------------------------------------------
Union Bank of
California, N. A. Union Bank of California, N. A. Union Bank of California, N. A.
GENERAL REVOLVING 000 Xxxxxxxxxx Xxxxxx, 0xx Xxxxx 000 Xxxxxxxxxx Xxxxxx, 0xx Xxxxx
COMMITMENT: Xxx Xxxxxxxxx, Xxxxxxxxxx 00000 Xxx Xxxxxxxxx, Xxxxxxxxxx 00000

$15,000,000 PRIMARY CONTACT:

Xxxxxxx X. Xxxxx
Vice President
Tel. : (000) 000-0000
Fax.: (000) 000-0000

CONTACT FOR BORROWINGS, PAYMENTS,
ETC.:

Xxxxx Xxxxxxxxxx
Tel.: (000) 000-0000
Fax. : (000) 000-0000

WIRING INFORMATION:
Union Bank of California, N. A.
0000 Xxxxxx Xxxxxx
Xxxxxxxx Xxxx, XX. 00000
ABA No. 122 000 496
A/C No. 070196431--Wire Transfer
Clearing
Ref.: Xx-Xxx Stores, Inc.
Attention: 192--Note Center CLO

Mercantile Bank National Mercantile Bank National Association Mercantile Bank National Association
Association GENERAL REVOLVING One Mercantile Center Xxx Xxxxxxxxxx Xxxxxx
XXXXXXXXXX: Xx. Xxxxx, Xxxxxxxx 00000 Xx. Xxxxx, Xxxxxxxx 00000

$15,000,000 PRIMARY CONTACT:

Xxxxx Xxxxx
Tel.: (000) 000-0000
Fax.: (000) 000-0000

CONTACT FOR BORROWINGS, PAYMENTS,
ETC.:

Xxxxxx Xxxxxxx
Tel.: (000) 000-0000
Fax.: (000) 000-0000

WIRING INFORMATION:
ABA Xx. 000 0000 000
X/X Xx. 000000-000
Ref.: Xx-Xxx Stores, Inc.
Attention: Commercial Loan Operations

-----------------------------------------------------------------------------------------------------------------------------------
The Huntington National
Bank The Huntington National Bank The Huntington National Bank
GENERAL REVOLVING 000 Xxxxxx Xxxxxx 000 Xxxxxx Xxxxxx
XXXXXXXXXX: Xxxxxxxxx, Xxxx 00000 Xxxxxxxxx, Xxxx 00000

$15,000,000 PRIMARY CONTACT:

Xxxxxxx X. Xxxx
Corporate Banking
Tel.: (000) 000-0000
Fax. : (000) 000-0000

CONTACT FOR BORROWINGS, PAYMENTS,
ETC.:
Xxxxxxxxx X. Xxxxxxx
Corporate Banking
Tel.: (000) 000-0000
Fax.: (000) 000-0000

WIRING INFORMATION:
ABA Xx. 000 0000 00
X/X Xx. 00000
Ref.: Xx-Xxx Stores, Inc.
Attention: Commercial Loan Operations

ANNEX II

INFORMATION AS TO SUBSIDIARIES
(as of May 5, 1999)

-----------------------------------------------------------------------------------------------------------------------------------
PERCENTAGE OF
OUTSTANDING STOCK
NAME OF TYPE OF JURISDICTION OR OTHER EQUITY
SUBSIDIARY ORGANIZATION WHERE INTERESTS OWNED
ORGANIZED (INDICATING WHETHER
OWNED BY THE
BORROWER OR A
SPECIFIED SUBSIDIARY)
-----------------------------------------------------------------------------------------------------------------------------------

FCA of California, Inc. corp. Ohio 100%, by the Borrower
-----------------------------------------------------------------------------------------------------------------------------------
FCA of Ohio, Inc. corp. Ohio 100%, by the Borrower
-----------------------------------------------------------------------------------------------------------------------------------
FCA of South Dakota, Inc. corp. Ohio 100%, by the Borrower
-----------------------------------------------------------------------------------------------------------------------------------
House of Fabrics, Inc. corp. Delaware 100%, by the Borrower
-----------------------------------------------------------------------------------------------------------------------------------
FCA Financial, Inc. corp. Ohio 100%, by the Borrower
-----------------------------------------------------------------------------------------------------------------------------------

ANNEX III

DESCRIPTION OF EXISTING INDEBTEDNESS

1. Revolving Credit Facility --- as of 4/30/99
- $215 million borrowed under facility including $15.0 million under
the $40.0 million temporary committed facility
- Six separate loans with various borrowing dates
- Any additional borrowings subsequent to such date in the ordinary
course of business

2. Uncommitted Lines of Credit --- as of 4/30/99
- $25.1 million borrowed with three banks
- Borrowings are on an overnight basis
- Any additional borrowings subsequent to such date in the ordinary
course of business.

3. Guarantor on $490,000 of $1.0 million line of credit that The Country
Sampler Store, L.L.C. (of which Xx-Xxx Stores has a 49% interest) has with
American National Bank and Trust Company of Chicago.

4. Trade Letters of Credit --- as of 4/30/99
- Approximately $45.0 million consisting of $30.2 million of
outstanding trade letters of credit and $14.8 million of related
acceptances
- Additional L/Cs incurred subsequent to such date in the ordinary
course of business

5. Insurance Standby Letter of Credit --- as of 4/30/99
- $1.941 million for Workers Compensation, General Liability and Auto
Insurance
- Beneficiary: Xxxxxx Insurance

6. Lease Standby Letter of Credit ---- as of 4/30/99
- $100,000 covering lease
- Beneficiary: Echo, L.L.C.

ANNEX IV
DESCRIPTION OF EXISTING LIENS

-----None-----

ANNEX V

DESCRIPTION OF EXISTING ADVANCES, LOANS, INVESTMENTS AND GUARANTEES

1. Existing investment in the capital of The Country Sampler Store, L.L.C. of
approximately $1,049,000, representing a 49% interest.

2. Five separate advances to The Country Sampler Store, L.L.C. (of which
Xx-Xxx Stores has a 49% interest) as follows:
- $147,000 at 7% interest paid quarterly--due June 30, 2007
- $294,000 at 7% interest paid quarterly--due March 31, 2008
- $134,750 at 7% interest paid quarterly--due June 15, 2008
- $247,250 at 7% interest paid quarterly--due September 30, 2008
- $196,000 at 7% interest paid quarterly--due March 31, 2009

3. Existing investment in the capital of Bouclair, Inc., of approximately
$3,159,225, representing a 24% interest.

4. See Guarantee of $490,000 of $1.0 million line of credit for The Country
Sampler Store, L.L.C., described in Annex III.

5. XxXxxxxx Ohio Tax Credit Fund
- Invests in low income housing to take advantage of tax credits
- Xx-Xxx Stores owns 4 of 47 limited partnership units at $500,000
each---$2.0 million investment
- Xx-Xxx currently has note payable to partnership for balance of
investment contribution of approximately $1.1 million

6. The Cleveland Development Partnership II
- Invests in projects that further the growth and development of
Cleveland
- Xx-Xxx Stores has invested $175,000 and has committed to another
$75,000 in November 1999

7. Ohio Innovation Fund
- Invests in early stage technology based businesses located
primarily in Ohio
- Xx-Xxx Stores has invested $35,000 and has committed to another
$87,500

ANNEX VI

DESCRIPTION OF LETTERS OF CREDIT
DEEMED ISSUED UNDER
THE CREDIT AGREEMENT

Letters of Credit issued by KeyBank National Association and outstanding on the
Closing Date. At the close of business on April 30, 1999, the aggregate
outstandings were:

STANDBY LETTERS OF CREDIT

$2,041,000

DOCUMENTARY LETTERS OF CREDIT
(INCLUDING ACCEPTANCES AND TIME DRAFTS)

$45,064,000

At the Closing Date, the total may be greater or less than the amount indicated
above, because of transactions in the ordinary course of business under the
Borrower's existing revolving credit agreement..

EXHIBIT A-1

GENERAL REVOLVING NOTE

$_______________ Cleveland, Ohio
_________, 1999

FOR VALUE RECEIVED, the undersigned XX-XXX STORES, INC., an Ohio
corporation (herein, together with its successors and assigns, the "BORROWER"),
hereby promises to pay to the order of _________________________ (the "LENDER"),
in lawful money of the United States of America in immediately available funds,
at the Payment Office (such term and certain other terms used herein without
definition shall have the meanings ascribed thereto in the Credit Agreement
referred to below) of KeyBank National Association (the "ADMINISTRATIVE AGENT"),
on the Maturity Date, the principal sum of ________________ DOLLARS AND NO CENTS
($ ) or, if less, the then unpaid principal amount of all General Revolving
Loans made by the Lender to the Borrower pursuant to the Credit Agreement.

The Borrower promises also to pay interest on the unpaid principal amount
of each General Revolving Loan made by the Lender to the Borrower in like money
at said office from the date hereof until paid at the rates and at the times
provided in section 2.6 of the Credit Agreement.

This Note is one of the General Revolving Notes referred to in the Credit
Agreement, dated as of May 5, 1999, among the Borrower, the financial
institutions from time to time party thereto (including the Lender), and KeyBank
National Association, as Administrative Agent (as from time to time in effect,
the "CREDIT AGREEMENT"), and is entitled to the benefits thereof and of the
other Credit Documents. As provided in the Credit Agreement, this Note is
subject to mandatory prepayment prior to the Maturity Date, in whole or in part.

In case an Event of Default shall occur and be continuing, the principal of
and accrued interest on this Note may be declared to be due and payable in the
manner and with the effect provided in the Credit Agreement.

The Borrower hereby waives presentment, demand, protest or notice of any
kind in connection with this Note. No failure to exercise, or delay in
exercising, any rights hereunder on the part of the holder hereof shall operate
as a waiver of any such rights.

THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAW
OF THE STATE OF OHIO.

XX-XXX STORES, INC.

By: ____________________________________
Executive Vice President
& Chief Financial Officer

LOANS AND PAYMENTS OF PRINCIPAL

AMOUNT
OF
DATE AMOUNT TYPE PRINCIPAL UNPAID
OF OF OF INTEREST PAID OR PRINCIPAL MADE
NOTATION LOAN LOAN PERIOD PREPAID BALANCE BY
-------------------------------------------------------------------------------

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

EXHIBIT A-2

SWING LINE NOTE

$________________ Cleveland, Ohio
_________, 1999

FOR VALUE RECEIVED, the undersigned XX-XXX STORES, INC., an Ohio
corporation (herein, together with its successors and assigns, the "BORROWER"),
hereby promises to pay to the order of _______________________ (the "LENDER"),
in lawful money of the United States of America in immediately available funds,
at the Payment Office (such term and certain other terms used herein without
definition shall have the meanings ascribed thereto in the Credit Agreement
referred to below) of KeyBank National Association (the "ADMINISTRATIVE AGENT"),
the principal sum of ________________ DOLLARS ($ ) or, if less, the then unpaid
principal amount of all Swing Line Loans made by the Lender to the Borrower
pursuant to the Credit Agreement. The Borrower will pay the principal amount of
each Swing Line Loan on the maturity date specified therefor in the Notice of
Borrowing relating thereto, which maturity date shall in any event be not more
than 7 days following the date such Swing Line Loan was made.

The Borrower promises also to pay interest on the unpaid principal amount
of each Swing Line Loan made by the Lender in like money at said office from the
date hereof until paid at the rates and at the times provided in section 2.6 of
the Credit Agreement.

This Note is the Swing Line Note referred to in the Credit Agreement, dated
as of May 5, 1999, among the Borrower, the financial institutions from time to
time party thereto (including the Lender), and KeyBank National Association, as
Administrative Agent (as from time to time in effect, the "CREDIT AGREEMENT"),
and is entitled to the benefits thereof and of the other Credit Documents. As
provided in the Credit Agreement, this Note is subject to mandatory prepayment
prior to the maturity of any Swing Line Loan evidenced hereby, in whole or in
part.

THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAW
OF THE STATE OF OHIO.

XX-XXX STORES, INC.

By: ____________________________________
Executive Vice President
& Chief Financial Officer

LOANS AND PAYMENTS OF PRINCIPAL

AMOUNT
OF
DATE AMOUNT TYPE PRINCIPAL UNPAID
OF OF OF PAID OR PRINCIPAL MADE
NOTATION LOAN LOAN MATURITY PREPAID BALANCE BY
-------------------------------------------------------------------------------

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

EXHIBIT B-1

NOTICE OF BORROWING

[Date]

KeyBank National Association,
as Administrative Agent for the Lenders party
to the Credit Agreement referred to below
000 Xxxxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000
Attention: LARGE CORPORATE GROUP

RE: NOTICE OF BORROWING
UNDER CREDIT AGREEMENT

Ladies and Gentlemen:

The undersigned, Xx-Xxx Stores, Inc., an Ohio corporation (the "BORROWER"),
refers to the Credit Agreement, dated as of May 5, 1999 (as amended from time to
time, the "CREDIT AGREEMENT", the terms defined therein being used herein as
therein defined), among the Borrower, the financial institutions from time to
time party thereto (the "LENDERS"), and KeyBank National Association, as
Administrative Agent for such Lenders, and hereby gives you notice, irrevocably,
pursuant to section 2.2(a) of the Credit Agreement, that the undersigned hereby
requests one or more Borrowings under the Credit Agreement, and in that
connection sets forth in the schedule attached hereto the information relating
to each such Borrowing (collectively the "PROPOSED BORROWING") as required by
section 2.2(a) of the Credit Agreement.

The Borrower hereby specifies that the Proposed Borrowing will consist of
Loans as indicated in the schedule attached hereto.

The Borrower hereby certifies that the following statements are true on the
date hereof, and will be true on the date of the Proposed Borrowing:

(A) the representations and warranties of the Credit Parties
contained in the Credit Agreement and the other Credit Documents are and
will be true and correct in all material respects, before and after giving
effect to the Proposed Borrowing and to the application of the proceeds
thereof, as though made on such date, except to the extent that such
representations and warranties expressly relate to an earlier specified
date, in which case such representations and warranties were true and
correct in all material respects as of the date when made; and

(B) no Default or Event of Default has occurred and is continuing,
or would result from such Proposed Borrowing or from the application of the
proceeds thereof.

Very truly yours,

XX-XXX STORES, INC.

By: ____________________________________
Title:

BORROWING SCHEDULE

PROPOSED BORROWING #1:

--------------------------------------------------------------------------------------------------------------------
BUSINESS DAY INTEREST PERIOD
OF AGGREGATE IF LOANS ARE
PROPOSED FACILITY TYPE OF AMOUNT EURODOLLAR
BORROWING LOANS OF LOANS LOANS
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------

General Revolving Prime Rate Loans One Month
____, 19___ Facility

Eurodollar Loans $_______ Two Months
Swing Line
Facility Money Market Rate Loans with Three Months
a maturity of ___ days (not
[Circle one of more than 7 days) and a Six Months
above] Quoted rate of ____%

[Circle one of

[Circle and/or above]
complete one of
above]

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

PROPOSED BORROWING #2:

General Revolving Prime Rate Loans One Month
____, 19___ Facility

[Circle one of

[Circle and/or above]
complete one of
above]

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

PROPOSED BORROWING #3:

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

General Revolving Prime Rate Loans One Month
____, 19___ Facility

[Circle one of
[Circle and/or above]
complete one of
above]

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

PROPOSED BORROWING #4:

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

BUSINESS DAY INTEREST PERIOD
OF AGGREGATE IF LOANS ARE
PROPOSED FACILITY TYPE OF AMOUNT EURODOLLAR
BORROWING LOANS OF LOANS LOANS

General Revolving Prime Rate Loans One Month
____, 19___ Facility

[Circle one of
[Circle and/or above]
complete one of
above]

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

EXHIBIT B-2

NOTICE OF CONVERSION

[Date]

KeyBank National Association,

as Administrative Agent for the Lenders party
to the Credit Agreement referred to below

000 Xxxxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000

Attention: LARGE CORPORATE GROUP

RE: NOTICE OF CONVERSION
OF OUTSTANDING GENERAL REVOLVING LOANS
UNDER THE CREDIT AGREEMENT

Ladies and Gentlemen:

The undersigned, Xx-Xxx Stores, Inc., an Ohio corporation (the "BORROWER"),
refers to the Credit Agreement, dated as of May 5, 1999 (as amended from time to
time, the "CREDIT AGREEMENT", the terms defined therein being used herein as
therein defined), among the Borrower, the financial institutions from time to
time party thereto (the "LENDERS"), and KeyBank National Association, as
Administrative Agent for such Lenders, and hereby gives you notice, irrevocably,
pursuant to section 2.5 of the Credit Agreement, that the undersigned hereby
requests one or more Conversions of General Revolving Loans of one Type into
General Revolving Loans of another Type, pursuant to section 2.5 of the Credit
Agreement, and in that connection sets forth in the schedule attached hereto the
information relating to each such conversion.

Very truly yours,

XX-XXX STORES, INC.

By: ____________________________________
Title:

CONVERSION SCHEDULE

PROPOSED CONVERSION #1

[OF THE GENERAL REVOLVING LOANS DESCRIBED IN THE FIRST TABLE BELOW
INTO GENERAL REVOLVING LOANS DESCRIBED IN THE SECOND TABLE BELOW,
SUCH CONVERSION TO BE MADE ON __________]

--------------------------------------------------------------------------------------------------------------------
AGGREGATE INTEREST PERIOD
AMOUNT IF LOANS ARE
DATE OF LOANS TYPE OF LOANS OF LOANS EURODOLLAR LOANS

One Month

____, 19__ Prime Rate Loans

$________ Two Months

Eurodollar Loans

Three Months

[Circle One of Six Months
Above]

[Circle one of
above]

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

One Month

____, 19__ Prime Rate Loans

$________ Two Months

Eurodollar Loans

Three Months

[Circle One of Six Months
Above]

[Circle one of
above]

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

PROPOSED CONVERSION #2

[OF THE GENERAL REVOLVING LOANS DESCRIBED IN THE FIRST TABLE BELOW
INTO GENERAL REVOLVING LOANS DESCRIBED IN THE SECOND TABLE BELOW,
SUCH CONVERSION TO BE MADE ON __________]

One Month

____, 19__ Prime Rate Loans

$________ Two Months

Eurodollar Loans

Three Months

[Circle One of Six Months
Above]

[Circle one of
above]

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

One Month

____, 19__ Prime Rate Loans

$________ Two Months

Eurodollar Loans

Three Months

[Circle One of Six Months
Above]

[Circle one of
above]

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

EXHIBIT B-3

LETTER OF CREDIT REQUEST

No. ______________(1)

Dated __________(2)

KeyBank National Association,
as Administrative Agent for the Lenders party
to the Credit Agreement referred to below
000 Xxxxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000

Attention: LARGE CORPORATE GROUP
& INTERNATIONAL DEPARTMENT

Ladies and Gentlemen:

The undersigned, Xx-Xxx Stores, Inc., an Ohio corporation (the "BORROWER"),
refers to the Credit Agreement, dated as of May 5, 1999 (as amended, modified or
supplemented from time to time, the "CREDIT AGREEMENT", the capitalized terms
defined therein being used herein as therein defined), among the Borrower, the
financial institutions from time to time party thereto (the "LENDERS"), and
KeyBank National Association, as Administrative Agent for such Lenders.

The Borrower hereby requests that ________ , as an Issuing Bank, issue a
Letter of Credit on ______________, 19__ (the "DATE OF ISSUANCE") in the
aggregate amount of U.S. $________________, for the account of_________.

The beneficiary of the requested Letter of Credit will be
________________,(3) and such Letter of Credit will be in support of
_____________________(4) and will have a stated termination date of
______________________.(5)

The Borrower hereby certifies that after giving effect to the requested
issuance of the Letter of Credit:

(i) $_________ principal amount of Loans will be outstanding;
and

(ii) $________ aggregate undrawn face amount of Letters of Credit will
be outstanding.

The Borrower hereby certifies that the following statements are true on the
date hereof, and will be true on the Date of Issuance:

---------------------------------
(1) Letter of Request Number

(2) Date of Letter of Request (at least three Business Days prior to the
Date of Issuance or such lesser number as may be agreed by the
relevant Issuing Bank).

(3) Insert name and address of beneficiary.

(4) Insert description of the supported obligations, name of agreement and/or
the commercial transaction to which this Letter of Credit Request relates.

(5) Insert last date upon which drafts may be presented (which may not be
beyond the 15th Business Day next preceding the Maturity Date).

(A) the representations and warranties of the Credit Parties contained
in the Credit Agreement and the other Credit Documents are and will be true
and correct in all material respects, before and after giving effect to the
issuance of the Letter of Credit requested hereby, as though made on the
Date of Issuance, except to the extent that such representations and
warranties expressly relate to an earlier specified date, in which case
such representations and warranties were true and correct in all material
respects when made; and

(B) no Default or Event of Default has occurred and is continuing, or
would result after giving effect to the issuance of the Letter of Credit
requested hereby.

Copies of all documentation with respect to the supported transaction are
attached hereto.

Very truly yours,

XX-XXX STORES, INC.

By: ____________________________________
Title:

EXHIBIT C

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

FORM OF

SUBSIDIARY GUARANTY

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

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

THE SUBSIDIARIES OF XX-XXX STORES, INC.
NAMED HEREIN
AS GUARANTORS

WITH

[LOGO]

KEYBANK NATIONAL ASSOCIATION,
AS ADMINISTRATIVE AGENT

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

SUBSIDIARY GUARANTY

DATED AS OF
MAY 5, 1999

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

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

SUBSIDIARY GUARANTY

SUBSIDIARY GUARANTY, dated as of May 5, 1999 (as amended, modified or
supplemented from time to time, "THIS GUARANTY"), made by each of the
undersigned (each, together with its successors and assigns, a "GUARANTOR" and
collectively, the "GUARANTORS"), with KEYBANK NATIONAL ASSOCIATION, a national
banking association, as Administrative Agent (herein, together with its
successors and assigns in such capacity, the "ADMINISTRATIVE AGENT") under the
Credit Agreement referred to below:

PRELIMINARY STATEMENTS:

(1) Except as otherwise defined herein, terms used herein and defined in
the Credit Agreement (as defined below) shall be used herein as therein defined.

(2) This Guaranty is made pursuant to the Credit Agreement, dated as of the
date hereof (herein, as amended or otherwise modified, restated or replaced from
time to time, the "CREDIT AGREEMENT"), among Xx-Xxx Stores, Inc., an Ohio
corporation (herein, together with its successors and assigns, the "BORROWER"),
the financial institutions named as lenders therein (herein, together with their
successors and assigns, the "LENDERS"), and KeyBank National Association, as the
Administrative Agent for the Lenders under the Credit Agreement, providing,
among other things, for loans or advances or other extensions of credit to or
for the benefit of the Borrower of up to $300,000,000, with such loans or
advances being evidenced by promissory notes (the "NOTES", such term to include
all notes and other securities issued in exchange therefor or in replacement
thereof).

(3) This Guaranty is made for the benefit of the Administrative Agent, each
Issuing Bank and the Lenders (all of the foregoing, collectively, the
"CREDITORS") to guarantee the payment of the principal of and interest on the
Notes and the payment and performance by the Borrower of its obligations under
the Credit Agreement and the other Credit Documents to which the Borrower is a
party. This Guaranty is one of the Credit Documents referred to in the Credit
Agreement.

(4) It is a condition to the making of Loans and the issuance of, and
participation in, Letters of Credit, under the Credit Agreement that each
Guarantor shall have executed and delivered this Guaranty.

(5) Each Guarantor is a direct or indirect Subsidiary of the Borrower. Each
Guarantor will obtain benefits from the incurrence of Loans by the Borrower, and
the issuance of Letters of Credit for the account of the Borrower or any of its
Subsidiaries, under the Credit Agreement and, accordingly, desires to execute
this Guaranty in order to satisfy the condition described in the preceding
paragraph and to induce the Lenders to make Loans to the Borrower, and to issue
and participate in Letters of Credit for the account of the Borrower or any of
its Subsidiaries.

NOW, THEREFORE, in consideration of the foregoing and other benefits
accruing to each Guarantor, the receipt and sufficiency of which are hereby
acknowledged, each Guarantor hereby makes the following representations and
warranties to the Administrative Agent and the other Creditors and hereby
covenants and agrees with the Administrative Agent and each other Creditor as
follows:

1. GUARANTY BY THE GUARANTORS, ETC. (a) Each Guarantor, jointly and
severally, irrevocably and unconditionally guarantees the full and prompt
payment when due (whether at the stated maturity, by acceleration or otherwise)
of the following:

(i) the principal of and interest on the Notes issued by, and the
Loans made to, the Borrower under the Credit Agreement,

(ii) all reimbursement obligations with respect to Letters of Credit
issued under the Credit Agreement, including (without limitation) all
obligations to reimburse LC Disbursements made pursuant to Letters of
Credit issued (or deemed issued) under the Credit Agreement, and

(iii) all other obligations and liabilities owing by the Borrower to
the Administrative Agent or any of the other Creditors under the Credit
Agreement and the other Credit Documents to which the Borrower is now or
may hereafter become a party (including, without limitation, indemnities,
Fees and other amounts payable thereunder),

in all cases whether now existing, or hereafter incurred under, arising out of,
or in connection with, the Credit Agreement or any of such other Credit
Documents, including any such interest or other amounts which, but for any
automatic stay under section 362(a) of the Bankruptcy Code, would become due.
Such guaranty is an absolute, unconditional, present and continuing guaranty of
payment and not of collectibility and is in no way conditioned or contingent
upon any attempt to collect from the Borrower or any other Subsidiary or
Affiliate of the Borrower, or any other action, occurrence or circumstance
whatsoever.

(b) In addition to the foregoing, each Guarantor also, jointly and
severally, irrevocably and unconditionally guarantees that each of the terms,
conditions, covenants and agreements of the Borrower under the Credit Agreement
and the other Credit Documents will be duly and punctually performed and
observed strictly in accordance with the terms thereof and that if for any
reason whatsoever the Borrower shall fail to do so, such Guarantor shall duly
and punctually perform and observe, or cause the Borrower to duly and punctually
perform and observe, the same. Such guaranty is an absolute, unconditional,
present and continuing guaranty of performance and is in no way conditioned or
contingent upon any attempt to enforce performance by the Borrower or any other
Subsidiary or Affiliate of the Borrower, or any other act, occurrence or
circumstance whatsoever.

(c) All indebtedness, liabilities and obligations guaranteed under section
1(a) and 1(b) hereof are herein collectively referred to as the "GUARANTEED
OBLIGATIONS".

(d) In addition to the foregoing, each Guarantor, jointly and severally,
unconditionally and irrevocably, guarantees the payment of any and all
Guaranteed Obligations to the Administrative Agent and the other Creditors,
whether or not due or payable by the obligor thereon, upon the occurrence in
respect of the Borrower or other applicable obligor of any bankruptcy or
insolvency proceeding or case under the Bankruptcy Code, and unconditionally and
irrevocably, jointly and severally, promises to pay such Guaranteed Obligations
to the Administrative Agent, for the benefit of the Creditors, on demand, in
such currency and otherwise in such manner as is provided in the Credit
Documents governing such Guaranteed Obligations.

(e) As a separate, additional and continuing obligation, each Guarantor
unconditionally and irrevocably undertakes and agrees, for the benefit of the
Creditors, that, should any amounts constituting Guaranteed Obligations not be
recoverable from the Borrower or other applicable obligor for any reason
whatsoever (including, without limitation, by reason of any provision of any
Credit Document or any other agreement or instrument executed in connection
therewith being or becoming, at any time, voidable, void, unenforceable, or
otherwise invalid under any applicable law), THEN notwithstanding any notice or
knowledge thereof by the Administrative Agent, any other Creditor, any of their
respective Affiliates, or any other person, each Guarantor, jointly and
severally, as sole, original and independent obligor, upon demand by the
Administrative Agent, will make payment to the Administrative Agent, for the
account of the Creditors, of all such obligations not so recoverable by way of
full indemnity, in such currency and otherwise in such manner as is provided in
the Credit Documents.

(f) Each Guarantor understands, agrees and confirms that the Administrative
Agent and the other Creditors may enforce this Guaranty up to the full amount of
the Guaranteed Obligations against any Guarantor without proceeding against any
other Guarantor, the Borrower or other person, against any security for all or
any portion of the Guaranteed Obligations, or under any other guaranty covering
all or any portion of the Guaranteed Obligations. All payments by each Guarantor
under this Guaranty shall be made in such currency and otherwise in such manner
as is provided in the Credit Documents to which such payments relate.

2. SUBORDINATION. (a) Any Indebtedness of the Borrower now or hereafter
held by any Guarantor is hereby subordinated to the Indebtedness of the Borrower
to the Administrative Agent and the other Creditors; and such Indebtedness of
the Borrower to any Guarantor, if the Administrative Agent, after an Event of
Default has occurred so requests, shall be collected, enforced and received by
such Guarantor as trustee for the Administrative Agent and the other Creditors
and be paid over to the Administrative Agent, for the benefit of the
Administrative Agent and the other Creditors, on account of the Indebtedness of
the Borrower to the Administrative Agent and the other Creditors, but without
affecting or impairing in any manner the liability of such Guarantor under the
other provisions of this Guaranty. Prior to the transfer by any Guarantor of any
note or negotiable instrument evidencing any Indebtedness of the Borrower to
such Guarantor, such Guarantor shall xxxx such note or negotiable instrument
with a legend that the same is subject to this subordination.

(b) If and to the extent that any Guarantor makes any payment to the
Administrative Agent or any other Creditor or to any other person pursuant to or
in respect of this Guaranty, any reimbursement or similar claim which such
Guarantor may have against the Borrower by reason thereof shall be subject and
subordinate to the prior termination of the Total Commitment and indefeasible
payment in full of all Guaranteed Obligations owed to the Administrative Agent
and the other Creditors.

3. GUARANTORS' OBLIGATIONS ABSOLUTE, ETC. The obligations of each Guarantor
under this Guaranty shall be absolute and unconditional, shall not be subject to
any counterclaim, setoff, deduction or defense based on any claim such Guarantor
may have against the Borrower or any other person, including, without
limitation, the Administrative Agent, any other Creditor, any of their
respective Affiliates, or any other Guarantor, and shall remain in full force
and effect without regard to, and shall not be released, suspended, abated,
deferred, reduced, limited, discharged, terminated or otherwise impaired or
adversely affected by any circumstance or occurrence whatsoever, other than
indefeasible payment in full of, and complete performance of, all of the
Guaranteed Obligations, including, without limitation:

(1) any increase in the amount of the Guaranteed Obligations
outstanding from time to time, including, without limitation, any increase
in the aggregate outstanding amount of the Loans and Letters of Credit
above any specific maximum amount referred to herein or in the Credit
Agreement as in effect on the date hereof, and any increase in any interest
rate, Fee or other amount applicable to any portion of the Guaranteed
Obligations or otherwise payable under any Credit Document;

(2) any direction as to the application of any payment by the Borrower
or by any other person;

(3) any incurrence of additional Guaranteed Obligations at any time or
under any circumstances, including, without limitation, (x) during the
continuance of a Default or Event of Default, (y)(1) at any time when all
conditions to such incurrence have not been satisfied, or (z) in excess of
borrowing base, sublimit or other similar or dissimilar limitations
contained in the Credit Agreement or any of the other Credit Documents;

(4) any renewal or extension of the time for payment or maturity of
any of the Guaranteed Obligations, or any amendment or modification of, or
addition or supplement to, or deletion from, the Credit Agreement, any
other Credit Document, or any other instrument or agreement applicable to
the Borrower or any other person, or any part thereof, or any assignment,
transfer or other disposition of any thereof;

(5) any failure of the Credit Agreement, any other Credit Document, or
any other instrument or agreement applicable to the Borrower or any other
person, to constitute the legal, valid and binding agreement or obligation
of any party thereto, enforceable in accordance with its terms, or any
irregularity in the form of any Credit Document;

(6) any failure on the part of the Borrower or any other person to
perform or comply with any term or provision of the Credit Agreement, any
other Credit Document, or any such other instrument or agreement;

(7) any waiver, consent, extension, indulgence or other action or
inaction (including, without limitation, any lack of diligence, any failure
to mitigate damages or xxxxxxxx assets, or any election of remedies) under
or in respect of (x) the Credit Agreement, any other Credit Document, or
any such other instrument or agreement, or (y) any obligation or liability
of the Borrower or any other person;

(8) any exercise or non-exercise of any right, power or remedy under
or in respect of the Credit Agreement, any other Credit Document, or any
such other instrument or agreement, or any such obligation or liability,
including, without limitation, (x) any failure of the Administrative Agent
or any other Creditor to give notice of any Default or Event of Default
under any Credit Document, or to advance funds for the protection or
preservation of, or provision of insurance for, or payment of taxes on, any
property which is collateral security for any of the Guaranteed
Obligations, and (y) any act or failure to act on the part of the
Administrative Agent or any other Creditor, in any manner referred to in
this Guaranty, or otherwise, which may deprive such Guarantor of its right
to (A) subrogation against the Borrower to recover full reimbursement or
indemnity for any payments made pursuant to this Guaranty, or (B)
contribution from any other Guarantor for any such payments made by it, or
which otherwise may adversely affect the amount recoverable upon the
exercise of any such right of subrogation or contribution;

(9) any application of any amounts by whomsoever paid or howsoever
realized to the Guaranteed Obligations or any other liabilities owed to the
Administrative Agent or any other Creditor, regardless of the order or
priority of any such application, and regardless of what liabilities of the
Borrower or any other person remain unpaid;

(10) any settlement or compromise of any of the Guaranteed
Obligations, any security therefor or guaranty thereof;

(11) any payment made to the Administrative Agent or any other
Creditor on the Guaranteed Obligations which the Administrative Agent or
any other Creditor repays, returns or otherwise restores to the Borrower or
any other applicable obligor pursuant to court order in any bankruptcy,
reorganization, arrangement, moratorium or other debtor relief proceeding;

(12) any subordination of any of the claims of the Administrative
Agent or any other Creditor to any claims of any creditors of the Borrower
or any other person, or any subordination of any liens or security
interests in favor of the Administrative Agent or any other Creditor to any
liens or security interests of any other person;

(13) any sale, exchange, release, surrender or foreclosure of, or any
realization upon, or other dealing with, in any manner and in any order,
any property, rights or interests by whomsoever at any time granted,
assigned, pledged or mortgaged to secure, or howsoever securing, the
Guaranteed Obligations, or any other liabilities or obligations (including
any of those hereunder), or any portion of any thereof;

(14) the existence of any right of setoff, offset or banker's lien, or
any failure to exercise rights in respect thereof, or any release thereof;

(15) any furnishing of any new or additional security or any new or
additional guaranty to or for the benefit of the Administrative Agent or
any other Creditor, or any acceptance thereof, including, without
limitation, any addition of any Guarantor to this Guaranty;

(16) any release of any security or any guaranty by or at the
direction of the Administrative Agent or any other Creditor, or any release
or discharge of, or limitation of recourse against, any person furnishing
any security or guaranty, including, without limitation, any release or
discharge of any Guarantor from this Guaranty;

(17) any limitation on any person's liability or obligation under the
Credit Agreement, any other Credit Document, or any such other instrument
or agreement, or any such obligation or liability, or any termination,
cancellation, avoidance, commercial or other frustration, impracticability,
invalidity, unenforceability or ineffectiveness, in whole or in part, of
the Credit Agreement, any other Credit Document, or any such other
instrument or agreement or any such obligation or liability or any term or
provision of any thereof;

(18) any insolvency, bankruptcy, receivership, liquidation,
reorganization, readjustment, composition, arrangement or other similar
proceeding relating to the Borrower or to any of its properties or assets,
or any such proceeding by, among or on behalf of any of its creditors, as
such, or any proceeding for the voluntary liquidation or dissolution or
other winding up of the Borrower, whether or not insolvency or bankruptcy
proceedings, or any assignment for the benefit of its creditors, or any
other marshaling of its assets, or any action taken by any trustee or
receiver or by any court in any such proceeding;

(19) any disallowance or limitation of any claim of the Administrative
Agent, any other Creditor, or any other person, in any such proceeding;

(20) any change in the ownership of all or any part of the capital
stock of, or other equity interests in, the Borrower, any of its
Subsidiaries or Affiliates, or any other person, or any merger or
consolidation involving the Borrower, any of its Subsidiaries or
Affiliates, or any other person, or any purchase, acquisition, sale, lease
or disposition by the Borrower, any of its Subsidiaries or Affiliates, or
any other person, of any assets or properties;

(21) any breach by the Borrower or any of its other Subsidiaries or
Affiliates of any of their representations or warranties contained in any
of the Credit Documents or any other certificate or document executed and
delivered in connection therewith;

(22) any inability of the Borrower to create or incur any Subordinated
Indebtedness or other Indebtedness, or the existence of any contractual or
other restriction upon the ability of the Borrower to issue and sell shares
of its capital stock, to purchase, sell, lease or otherwise dispose of
assets, to incur Subordinated Indebtedness or other Indebtedness, or to
otherwise conduct its business affairs;

(23) any assignment, transfer or other disposition, in whole or in
part, by the Borrower or any other person of its interest in any of the
property, rights or interests constituting security for all or any portion
of the Guaranteed Obligations or any other Indebtedness, liabilities or
obligations;

(24) any failure of any of the Credit Documents, or any other
agreement or instrument securing all or any portion of the Guaranteed
Obligations, to effectively subject any property, rights or interests to
any liens or security interests purported to be granted or created thereby,
or any failure of any such liens or security interests to be or become
perfected or to establish or maintain the priority over other liens and
security interests contemplated thereby;

(25) any condemnation or taking of, or any encumbrance on or
interference with any use of, or any damage to, or any destruction of, any
such property, or any part thereof or interest therein;

(26) any lack of notice to, or knowledge by, any Guarantor of any of
the matters referred to above; and/or

(27) any other circumstance or occurrence, whether similar or
dissimilar to any of the foregoing, which could or might constitute a
defense available to, or a discharge of the obligations of, a guarantor or
other surety.

4. WAIVERS. Each Guarantor unconditionally waives, to the maximum extent
permitted under any applicable law now or hereafter in effect, insofar as its
obligations under this Guaranty are concerned, (i) notice of any of the matters
referred to in section 3, (ii) all notices required by statute, rule of law or
otherwise to preserve any rights against such Guarantor hereunder, including,
without limitation, any demand, presentment, proof or notice of dishonor or
non-payment of any Guaranteed Obligation, notice of acceptance of this Guaranty,
notice of the incurrence of any Guaranteed Obligation, notice of any failure on
the part of the Borrower, any of its Subsidiaries or Affiliates, or any other
person, to perform or comply with any term or provision of the Credit Agreement,
any other Credit Document or any other agreement or instrument to which the
Borrower or any other person is a party, or notice of the commencement of any
proceeding against any other person or its any of its property or assets, (iii)
any right to the enforcement, assertion or exercise against the Borrower or
against any other person or any collateral of any right, power or remedy under
or in respect of the Credit Agreement, the other Credit Documents or any other
agreement or instrument, and (iv) any requirement that such Guarantor be joined
as a party to any proceedings against the Borrower or any other person for the
enforcement of any term or provision of the Credit Agreement, the other Credit
Documents, this Guaranty or any other agreement or instrument.

5. SUBROGATION RIGHTS. Until such time as the Guaranteed Obligations have
been paid in full in cash and otherwise fully performed and the Total Commitment
under the Credit Agreement has been terminated, each Guarantor hereby
irrevocably waives all rights of subrogation which it may at any time otherwise
have as a result of this Guaranty (whether contractual, under section 509 of the
Bankruptcy Code, or otherwise) to the claims of the Administrative Agent and/or
the other Creditors against the Borrower, any other Guarantor or any other
guarantor of or surety for the Guaranteed Obligations and all contractual,
statutory or common law rights of reimbursement, contribution or indemnity from
the Borrower or any other Guarantor which it may at any time otherwise have as a
result of this Guaranty.

6. SEPARATE ACTIONS. A separate action or actions may be brought and
prosecuted against any Guarantor whether or not action is brought against any
other Guarantor, any other guarantor or the Borrower, and whether or not any
other Guarantor, any other guarantor of the Borrower or the Borrower be joined
in any such action or actions.

7. GUARANTORS FAMILIAR WITH BORROWER'S AFFAIRS, ETC. Each Guarantor
confirms that an executed (or conformed) copy of each of the Credit Documents
has been made available to its principal executive officers, that such officers
are familiar with the contents thereof and of this Guaranty, and that it has
executed and delivered this Guaranty after reviewing the terms and conditions of
the Credit Agreement, the other Credit Documents and this Guaranty and such
other information as it has deemed appropriate in order to make its own credit
analysis and decision to execute and deliver this Guaranty. Each Guarantor
confirms that it has made its own independent investigation with respect to the
creditworthiness of the Borrower and its other Subsidiaries and Affiliates and
is not executing and delivering this Guaranty in reliance on any representation
or warranty by the Administrative Agent or any other Creditor or any other
person acting on behalf of the Administrative Agent or any other Creditor as to
such creditworthiness. Each Guarantor expressly assumes all responsibilities to
remain informed of the financial condition of the Borrower and its other
Subsidiaries and Affiliates and any circumstances affecting (i) the Borrower's
or any other Subsidiary's or Affiliate's ability to perform its obligations
under the Credit Agreement and the other Credit Documents to which it is a
party, or (ii) any collateral securing, or any other guaranty for, all or any
part of the Borrower's or such other Subsidiary's or Affiliate's payment and
performance obligations thereunder; and each Guarantor further agrees that the
Administrative Agent and the other Creditors shall have no duty to advise any
Guarantor of information known to them regarding such circumstances or the risks
such Guarantor undertakes in this Guaranty.

8. COVENANT NOT TO CAUSE EVENTS OF DEFAULT UNDER CREDIT AGREEMENT, ETC.
Each Guarantor covenants and agrees that on and after the date hereof and until
this Guaranty is terminated in accordance with section 25 hereof, such Guarantor
shall take, or will refrain from taking, as the case may be, all actions that
are necessary to be taken or not taken so that no violation of any provision,
covenant or agreement contained in section 8 or 9 of the Credit Agreement, and
so that no Default or Event of Default, is caused by the actions of such
Guarantor or any of its Subsidiaries.

9. REPRESENTATIONS AND WARRANTIES. Each Guarantor represents and warrants
that:

(a) it is a duly organized or formed and validly existing corporation,
partnership or limited liability company, as the case may be, in good
standing under the laws of the jurisdiction of its formation and has the
corporate, partnership or limited liability company power and authority, as
applicable, to own its property and assets and to transact the business in
which it is engaged and presently proposes to engage;

(b) it has the corporate or other organizational power and authority
to execute, deliver and carry out the terms and provisions of the Credit
Documents to which it is party and has taken all necessary corporate or
other organizational action to authorize the execution, delivery and
performance of the Credit Documents to which it is party;

(c) it has duly executed and delivered each Credit Document to which
it is party and each Credit Document to which it is party constitutes the
legal, valid and binding agreement or obligation of such Guarantor
enforceable in accordance with its terms, except to the extent that the
enforceability thereof may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws generally affecting
creditors' rights and by equitable principles (regardless of whether
enforcement is sought in equity or at law);

(d) neither the execution, delivery and performance by such Guarantor
of the Credit Documents to which it is party nor compliance with the terms
and provisions thereof (i) will contravene any provision of any law,
statute, rule, regulation, order, writ, injunction or decree of any court
or governmental instrumentality applicable to such Guarantor or its
properties and assets, (ii) will conflict with or result in any breach of,
any of the terms, covenants, conditions or provisions of, or constitute a
default under, or result in the creation or imposition of (or the
obligation to create or impose) any Lien upon any of the property or assets
of such Guarantor pursuant to the terms of any promissory note, bond,
debenture, indenture, mortgage, deed of trust, credit or loan agreement, or
any other material agreement or other instrument, to which such Guarantor
is a party or by or to which it or any of its property or assets are bound
or affected, or (iii) will violate any provision of the certificate or
articles of incorporation, code of regulations or by-laws, or other charter
or organizational documents of such Guarantor;

(e) no order, consent, approval, license, authorization, or validation
of, or filing, recording or registration with, or exemption by, any foreign
or domestic governmental or public body or authority, or any subdivision
thereof, is required to authorize or is required as a condition to (i) the
execution, delivery and performance by such Guarantor of any Credit
Document to which it is a party, or (ii) the legality, validity, binding
effect or enforceability of any Credit Document to which such Guarantor is
a party;

(f) there are no actions, suits or proceedings pending or, to, the
knowledge of such Guarantor, threatened with respect to such Guarantor
which question the validity or enforceability of any of the Credit
Documents to which such Guarantor is a party, or of any action to be taken
by such Guarantor pursuant to any of the Credit Documents to which it is a
party; and

(g) as of the date such Guarantor has become a party to this Guaranty,
(i) such Guarantor has received consideration which is the reasonable
equivalent value of the obligations and liabilities that such Guarantor has
incurred to the Administrative Agent and the other Creditors under this
Guaranty and the other Credit Documents to which such Guarantor is a party;
(ii) such Guarantor has capital sufficient to carry on its business and
transactions and all business and transactions in which it is about to
engage and is solvent and able to pay its debts as they mature; (iii) such
Guarantor owns property having a value, both at fair valuation and at
present fair salable value, greater than the amount required to pay its
debts; and (iv) such Guarantor is not entering into the Credit Documents to
which it is a party with the intent to hinder, delay or defraud its
creditors.

10. CONTINUING GUARANTY; REMEDIES CUMULATIVE, ETC. This Guaranty is a
continuing guaranty, all liabilities to which it applies or may apply under the
terms hereof shall be conclusively presumed to have been created in reliance
hereon, and this Guaranty shall remain in full force and effect until terminated
as provided in section 25 hereof. No failure or delay on the part of the
Administrative Agent or any other Creditor in exercising any right, power or
privilege hereunder shall operate as a waiver thereof; nor shall any single or
partial exercise of any right, power or privilege hereunder preclude any other
or further exercise thereof or the exercise of any other right, power or
privilege. The rights and remedies herein expressly specified are cumulative and
not exclusive of any rights or remedies which the Administrative Agent or any
other Creditor would otherwise have. No notice to or demand on any Guarantor in
any case shall entitle such Guarantor to any other further notice or demand in
similar or other circumstances or constitute a waiver of the rights of the
Administrative Agent or any other Creditor to any other or further action in any
circumstances without notice or demand. It is not necessary for the
Administrative Agent or any other Creditor to inquire into the capacity or
powers of the Borrower or any of its Subsidiaries or the officers, directors,
partners or agents acting or purporting to act on its behalf, and any
indebtedness made or created in reliance upon the professed exercise of such
powers shall be guaranteed hereunder.

11. ENFORCEMENT EXPENSES. The Guarantors hereby jointly and severally agree
to pay, to the extent not paid pursuant to section 12.1 of the Credit Agreement,
all reasonable out-of-pocket costs and expenses of the Administrative Agent and
each Creditor in connection with the enforcement of this Guaranty and any
amendment, waiver or consent relating hereto (including, without limitation, the
reasonable fees and disbursements of counsel employed by the Administrative
Agent or any of the other Creditors).

12. SUCCESSORS AND ASSIGNS. This Guaranty shall be binding upon each
Guarantor and its successors and assigns, and shall inure to the benefit of the
Administrative Agent and the other Creditors and their successors and assigns.

13. AMENDMENTS AND WAIVERS. Neither this Guaranty nor any provision hereof
may be changed, waived, discharged or terminated except with the written consent
of (i) the Administrative Agent, acting with the written consent of the Required
Lenders (or to the extent required by section 12.12 of the Credit Agreement,
with the written consent of each Lender), and (ii) each Guarantor affected
thereby (it being understood that the addition or release of any Guarantor
hereunder shall not constitute a change, waiver, discharge or termination
affecting any Guarantor other than the Guarantor so added or released).

14. HEADINGS DESCRIPTIVE. The headings of the several sections of this
Guaranty are inserted for convenience only and shall not in any way affect the
meaning or construction of any provision of this Guaranty.

15. SEVERABILITY. Any provision of this Guaranty which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.

16. RIGHT OF SETOFF. In addition to any rights now or hereafter granted
under applicable law and not by way of limitation of any such rights, upon the
occurrence and during the continuance of an Event of Default, each Creditor is
hereby authorized at any time or from time to time, without notice to any
Guarantor or to any other person, any such notice being expressly waived, to set
off and to appropriate and apply any and all deposits (general or special) and
any other indebtedness at any time held or owing by such Creditor to or for the
credit or the account of such Guarantor, against and on account of the
obligations and liabilities of such Guarantor to such Creditor under this
Guaranty, irrespective of whether or not the Administrative Agent or such
Creditor shall have made any demand hereunder and although said obligations,
liabilities, deposits or claims, or any of them, shall be contingent or
unmatured. Each Creditor agrees to promptly notify the relevant Guarantor after
any such set off and application, PROVIDED, HOWEVER, that the failure to give
such notice shall not affect the validity of such set off and application.

17. NOTICES. All notices requests, demands or other communications pursuant
hereto shall be made in writing (including telegraphic, telex, facsimile
transmission or cable communication) and mailed, telegraphed, telexed,

transmitted, cabled or delivered, if to any Guarantor, at the address specified
for it in Annex II to the Credit Agreement (or if no such address is specified,
to it c/o the Borrower), with a courtesy copy to the Borrower at its address
specified in or pursuant to the Credit Agreement; if to the Administrative Agent
or any Lender, as provided in the Credit Agreement; or in any case at such other
address as any of the persons listed above may hereafter notify the others in
writing. All such notices and communication shall be mailed, telegraphed,
telexed, facsimile transmitted, or cabled or sent by overnight courier, and
shall be effective when received.

18. REINSTATEMENT. If claim is ever made upon the Administrative Agent or
any other Creditor for recission, repayment, recovery or restoration of any
amount or amounts received by the Administrative Agent or any other Creditor in
payment or on account of any of the Guaranteed Obligations and any of the
aforesaid payees repays all or part of said amount by reason of (x) any
judgment, decree or order of any court or administrative body having
jurisdiction over such payee or any of its property, or (y) any settlement or
compromise of any such claim effected by such payee with any such claimant
(including the Borrower), THEN and in such event (i) any such judgment, decree,
order, settlement or compromise shall be binding upon each Guarantor,
notwithstanding any revocation hereof or other instrument evidencing any
liability of the Borrower, (ii) each Guarantor shall be and remain liable to the
aforesaid payees hereunder for the amount so repaid or otherwise recovered or
restored to the same extent as if such amount had never originally been received
by any such payee, and (iii) this Guaranty shall continue to be effective or be
reinstated, as the case may be, all as if such repayment or other recovery had
not occurred.

19. GOVERNING LAW; VENUE; WAIVER OF JURY TRIAL. (a) THIS GUARANTY AND THE
RIGHTS AND OBLIGATIONS OF THE ADMINISTRATIVE AGENT, THE CREDITORS AND OF THE
UNDERSIGNED HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAW OF THE STATE OF OHIO. Any legal action or proceeding with respect to this
Guaranty may be brought in the Courts of the State of Ohio, or of the United
States of America for the Northern District of Ohio, and, by execution and
delivery of this Guaranty, each Guarantor hereby irrevocably accepts for itself
and in respect of its property, generally and unconditionally, the jurisdiction
of the aforesaid courts. Each Guarantor hereby irrevocably consents to the
service of process out of any of the aforementioned courts in any such action or
proceeding by the mailing of copies thereof by registered mail, return receipt
requested, to such Guarantor at its address provided herein, such service to
become effective 30 days after such mailing, or such earlier time as may be
provided by applicable law. Nothing herein shall affect the right of the
Administrative Agent or any of the other Creditors to serve process in any other
manner permitted by law or to commence legal proceedings or otherwise proceed
against each Guarantor in any other jurisdiction.

(b) Each Guarantor hereby irrevocably waives any objection which it may now
or hereafter have to the laying of venue of any of the aforesaid actions or
proceedings arising out of or in connection with this Guaranty or any other
Credit Document or Credit Document brought in the courts referred to in section
19(a) above and hereby further irrevocably waives and agrees not to plead or
claim in any such court that such action or proceeding brought in any such court
has been brought in an inconvenient forum.

(c) EACH GUARANTOR, THE ADMINISTRATIVE AGENT AND EACH OTHER CREDITOR HEREBY
IRREVOCABLY WAIVES ALL RIGHTS TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR
COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS GUARANTY, THE OTHER CREDIT
DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.

20. SALE OF CAPITAL STOCK OF A GUARANTOR. In the event that all of the
capital stock of one or more Guarantors is sold or otherwise disposed of or
liquidated in compliance with the requirements of section 9.2 of the Credit
Agreement (or such sale or other disposition has been approved in writing by the
Required Lenders (or all Lenders if required by section 12.12 of the Credit
Agreement)) and the proceeds of such sale, disposition or liquidation are
applied, to the extent applicable, in accordance with the provisions of the
Credit Agreement, such Guarantor shall be released from this Guaranty and this
Guaranty shall, as to each such Guarantor or Guarantors, terminate, and have no
further force or effect (it being understood and agreed that the sale of one or
more persons that own, directly or indirectly, all of the capital stock or other
equity interests of any Guarantor shall be deemed to be a sale of such Guarantor
for the purposes of this section 20).

21. CONTRIBUTION AMONG GUARANTORS. Each Guarantor, in addition to the
subrogation rights it shall have against the Borrower under applicable law as a
result of any payment it makes hereunder, shall also have a right of
contribution against all other Guarantors in respect of any such payment PRO
RATA among same based on their respective net fair value as enterprises,
PROVIDED any such right of contribution shall be subject and subordinate to the
prior payment in full of the Guaranteed Obligations (and such Guarantor's
obligations in respect thereof).

22. FULL RECOURSE OBLIGATIONS; EFFECT OF FRAUDULENT TRANSFER LAWS, ETC. It
is the desire and intent of each Guarantor, the Administrative Agent and the
other Creditors that this Guaranty shall be enforced as a full recourse
obligation of each Guarantor to the fullest extent permissible under the laws
and public policies applied in each jurisdiction in which enforcement is sought.
If and to the extent that the obligations of any Guarantor under this Guaranty
would, in the absence of this sentence, be adjudicated to be invalid or
unenforceable because of any applicable state or federal law relating to
fraudulent conveyances or transfers, then the amount of such Guarantor's
liability hereunder in respect of the Guaranteed Obligations shall be deemed to
be reduced AB INITIO to that maximum amount which would be permitted without
causing such Guarantor's obligations hereunder to be so invalidated.

23. PAYMENTS FREE AND CLEAR OF SETOFFS, COUNTERCLAIMS AND TAXES, ETC. (a)
All payments made by any Guarantor hereunder will be made without setoff,
counterclaim or other defense and, except as provided for in section 23(b), all
such payments will be made free and clear of, and without deduction or
withholding for, any present or future taxes, levies, imposts, duties, fees,
assessments or other charges of whatever nature now or hereafter imposed by any
jurisdiction or by any political subdivision or taxing authority thereof or
therein with respect to such payments (but excluding, except as provided in the
second succeeding sentence, any tax, imposed on or measured by the net income or
net profits of a Creditor pursuant to the laws of the jurisdiction under which
such Creditor is organized or the jurisdiction in which the principal office or
Applicable Lending Office of such Creditor is located or any subdivision thereof
or therein) and all interest, penalties or similar liabilities with respect to
such non excluded taxes, levies imposts, duties, fees, assessments or other
charges (all such nonexcluded taxes levies, imposts, duties, fees assessments or
other charges being referred to collectively as "TAXES"). If any Taxes are so
levied or imposed, the applicable Guarantor agrees to pay the full amount of
such Taxes and such additional amounts as may be necessary so that every payment
by it of all amounts due hereunder, after withholding or deduction for or on
account of any Taxes will not be less than the amount provided for herein. If
any amounts are payable in respect of Taxes pursuant to the preceding sentence,
the applicable Guarantor agrees to reimburse each Creditor, upon the written
request of such Creditor for taxes imposed on or measured by the net income or
profits of such Creditor pursuant to the laws of the jurisdiction in which such
Creditor is organized or in which the principal office or Applicable Lending
Office of such Creditor is located or under the laws of any political
subdivision or taxing authority of any such jurisdiction in which the principal
office or Applicable Lending Office of such Creditor is located and for any
withholding of income or similar taxes imposed by the United States of America
as such Creditor shall determine are payable by, or withheld from, such Creditor
in respect of such amounts so paid to or on behalf of such Creditor pursuant to
the preceding sentence, which request shall be accompanied by a statement from
such Creditor setting forth, in reasonable detail, the computations used in
determining such amounts. The applicable Guarantor will furnish to the
Administrative Agent within 45 days after the date the payment of any Taxes, or
any withholding or deduction on account thereof, is due pursuant to applicable
law certified copies of tax receipts, or other evidence satisfactory to the
applicable Creditor, evidencing such payment by the applicable Creditor. Each
applicable Guarantor will indemnify and hold harmless the Administrative Agent
and each Creditor, and reimburse the Administrative Agent or such Creditor upon
its written request, for the amount of any Taxes so levied or imposed and paid
or withheld by such Creditor.

(b) Notwithstanding anything to the contrary contained in section 23(a),
(i) any applicable Guarantor shall be entitled, to the extent it is required to
do so by law, to deduct or withhold income or other similar taxes imposed by the
United States (or any political subdivision or taxing authority thereof or
therein) from any amounts payable hereunder for the account of any Creditor
which is not a United States person (as such term is defined in section
7701(a)(30) of the Code) for United States federal income tax purposes and which
has not provided to the Borrower such forms that establish a complete exemption
from such deduction or withholding; and (ii) any applicable Guarantor shall not
be obligated pursuant to section 23(a) hereof to gross-up payments to be made to
a Creditor in

respect of income or similar taxes imposed by the United States or any
additional amounts with respect thereto if such Lender has not provided to the
Borrower such forms.

24. JUDGMENT CURRENCY. (a) If for the purposes of obtaining judgment in
any court it is necessary to convert a sum due hereunder in any currency (the
"ORIGINAL CURRENCY") into another currency (the "OTHER CURRENCY") each
Guarantor, the Administrative Agent and the other Creditors, by their acceptance
of the benefits hereof, agree, to the fullest extent that they may effectively
do so, that the rate of exchange used shall be that at which in accordance with
normal banking procedures the Administrative Agent could purchase the Original
Currency with the Other Currency at the Payment Office on the second Business
Day preceding that on which final judgment is given.

(b) The obligation of a Guarantor in respect of any sum due in the Original
Currency from it to the Administrative Agent or any other Creditor hereunder
shall, notwithstanding any judgment in any Other Currency, be discharged only to
the extent that on the Business Day following receipt by such Creditor or the
Administrative Agent (as the case may be) of any sum adjudged to be so due in
such Other Currency such Creditor or the Administrative Agent (as the case may
be) may in accordance with normal banking procedures purchase U.S. Dollars with
such Other Currency; if the amount of the Original Currency so purchased is less
than the sum originally due to such Creditor or the Administrative Agent (as the
case may be) in the Original Currency, such Guarantor agrees, as a separate
obligation and notwithstanding any such judgment, to indemnify such Creditor or
the Administrative Agent (as the case may be) against such loss, and if the
amount of the Original Currency so purchased exceeds the sum originally due to
the Administrative Agent or any other Creditor (as the case may be) in the
Original Currency, such Creditor or the Administrative Agent (as the case may
be) agrees to remit to such Guarantor such excess.

25. TERMINATION. Upon receipt by the Administrative Agent of evidence
satisfactory to it (1) of the termination of the Total Commitment, (2) that no
Letters of Credit remain outstanding, (3) of the payment (or prepayment) in full
of the principal of and interest on all the Notes in accordance with the terms
thereof and of the Credit Agreement, and (4) of the payment (or the making of
provision satisfactory to the Administrative Agent for the payment) of all other
amounts included in the Guaranteed Obligations, THEN this Guaranty shall
terminate and the Administrative Agent, at the request and expense of the
Borrower or any of the the Guarantors, will execute and deliver to the Borrower
and the Guarantors a proper instrument or instruments acknowledging the
satisfaction and termination of this Guaranty.

26. ENFORCEMENT BY ADMINISTRATIVE AGENT. The Creditors agree that this
Guaranty may be enforced only by the action of the Administrative Agent, acting
upon the instructions of the Required Lenders, and that no Creditor other than
the Administrative Agent shall have any right individually to seek to enforce or
to enforce this Guaranty, it being understood and agreed that such rights and
remedies may be exercised by the Administrative Agent, for the benefit of the
Creditors, upon the terms of this Guaranty. The Administrative Agent and the
other Creditors further agree that this Guaranty may not be enforced against any
director, officer or employee of any Guarantor, as such.

27. GENERAL LIMITATION OF LIABILITY. No claim may be made by any Guarantor
against the Administrative Agent or any other Creditor, or the Affiliates,
directors, officers, employees, attorneys or agents of any of them, for any
damages other than actual compensatory damages in respect of any claim for
breach of contract or any other theory of liability arising out of or related to
the transactions contemplated by this Guaranty or any of the other Credit
Documents, or any act, omission or event occurring in connection therewith; and
each Guarantor hereby, to the fullest extent permitted under applicable law,
waives, releases and agrees not to xxx or counterclaim upon any such claim for
any special, consequential or punitive damages, whether or not accrued and
whether or not known or suspected to exist in its favor.

28. NO DUTY. All attorneys, accountants, appraisers, consultants and other
professional persons (including the firms or other entities on behalf of which
any such person may act) retained by the Administrative Agent or any other
Creditor with respect to the transactions contemplated by the Credit Documents
shall have the right to act exclusively in the interest of the Administrative
Agent or such other Creditor, as the case may be, and shall have

no duty of disclosure, duty of loyalty, duty of care, or other duty or
obligation of any type or nature whatsoever to any Guarantor, to any of its
Affiliates, or to any other person, with respect to any matters within the scope
of such representation or related to their activities in connection with such
representation. Each Guarantor agrees, on behalf of itself and its Affiliates,
not to assert any claim or counterclaim against any such persons with regard to
such matters, all such claims and counterclaims, now existing or hereafter
arising, whether known or unknown, foreseen or unforeseeable, being hereby
waived, released and forever discharged.

29. CREDITORS NOT FIDUCIARY TO GUARANTORS, ETC. The relationship among any
Guarantor and its Affiliates, on the one hand, and the Administrative Agent and
the other Creditors, on the other hand, is solely that of debtor and creditor,
and the Administrative Agent and the other Creditors have no fiduciary or other
special relationship with any Guarantor or any of its Affiliates, and no term or
provision of any Credit Document, no course of dealing, no written or oral
communication, or other action, shall be construed so as to deem such
relationship to be other than that of debtor and creditor.

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

IN WITNESS WHEREOF, each Guarantor has caused this Guaranty to be executed
and delivered as of the date first above written.

FCA FINANCIAL, INC., FABRI-CENTERS OF SOUTH DAKOTA, INC.,
AS A GUARANTOR AS A GUARANTOR

BY: /S/ XXXXX X. XXXXXX BY: /S/ XXXXX X. XXXXXX
---------------------------- -----------------------------
TITLE: TITLE:

FCA OF OHIO, INC., FABRI-CENTERS OF CALIFORNIA, INC.,
AS A GUARANTOR AS A GUARANTOR

BY: /S/ XXXXX X. XXXXXX BY: /S/ XXXXX X. XXXXXX
---------------------------- -----------------------------
TITLE: TITLE:

HOUSE OF FABRICS, INC.,
AS A GUARANTOR

BY: /S/ XXXXX X. XXXXXX
-----------------------------
TITLE:

ACCEPTED AND AGREED.

KEYBANK NATIONAL ASSOCIATION,
AS ADMINISTRATIVE AGENT

BY: /S/ ILLEGIBLE
---------------------------
VICE PRESIDENT

EXHIBIT D

----------------------------
FORM OF

OPINION OF SPECIAL COUNSEL
TO THE
BORROWER
----------------------------

________ __, 1999

To the Administrative Agent and
each of the Lenders party
to the Credit Agreement
referred to below
c/o KeyBank National Association
000 Xxxxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000

Attention: LARGE CORPORATE GROUP

RE: $300,000,000 CREDIT AGREEMENT
WITH XX-XXX STORES, INC.

Ladies and Gentlemen:

We have acted as special counsel to Xx-Xxx Stores, Inc., an Ohio
corporation (the "BORROWER"), in connection with (i) the execution and delivery
of the Credit Agreement, dated as of May 5, 1999 (the "CREDIT AGREEMENT"), among
the Borrower, the financial institutions party thereto (the "LENDERS"), and
KeyBank National Association, as Administrative Agent, and (ii) the transactions
contemplated thereby. Unless otherwise indicated, capitalized terms used herein
but not otherwise defined herein shall have the respective meanings set forth in
the Credit Agreement. This opinion letter is delivered by us to you at the
request of the Borrower in accordance with the requirements of section 6.1(f) of
the Credit Agreement.

As such special counsel, we have examined originals or copies, certified or
otherwise identified to our satisfaction, of such documents, records and matters
of law as we have considered necessary as a basis for the opinions set forth
herein, including without limitation the following:

(a) the Credit Agreement;

(b) the Notes delivered today pursuant to the Credit Agreement; and

The documents referred to in clauses (a) through (c) above are herein sometimes
referred to as the "CREDIT DOCUMENTS".

In our examination we have assumed the genuineness of all signatures (other
than as to any Credit Party), the authenticity of all documents submitted to us
as originals, the conformity to original documents of all documents submitted to
us as certified or photostatic copies and the authenticity of the originals of
such copies. As to questions of fact not independently verified by us we have
relied, to the extent we deemed appropriate, upon representations and
certificates of officers of the respective Credit Parties, public officials and
other appropriate persons. We have also assumed, with your approval, the due
authorization, execution and delivery of the Credit Documents on the part of the
Administrative Agent and the Lenders and the legality, validity, binding effect
on, and enforceability of the Credit Documents against those persons. All
assumptions and statements of reliance as to factual matters herein have been
made without any independent investigation or verification on our part except to
the extent otherwise expressly stated, and we express no opinion with respect to
the subject matter or accuracy of such assumptions or items relied upon.

We understand that you have considered the applicability of fraudulent
transfer laws to the transactions contemplated by the Credit Documents, as to
which laws we express no opinion, and have satisfied yourself with respect
thereto.

Our examination of matters of law in connection with the opinions expressed
herein has been limited to the federal laws of the United States, the laws of
the State of Ohio, and the corporate laws of the State of Delaware, and
accordingly, no opinions expressed herein shall be deemed to cover any other
laws.

We have neither examined nor requested an examination of the indices or
records of any court or governmental or other agency, authority, instrumentality
or entity, nor have we made inquiry of any person or entity, except as expressly
set forth in this opinion letter. In addition, we have not independently
verified or investigated the accuracy or completeness of any factual information
and, because the scope of our examination did not include such verification, we
assume no responsibility for the accuracy or completeness of any such
information.

As used herein, "to our knowledge" shall mean to the actual knowledge of
the lawyers who have been actively involved in the negotiation of the Credit
Documents and the lawyers in our firm who are the current primary contacts for
the Borrower at the firm.

Based upon the foregoing and subject to the qualifications, assumptions and
limitations contained in this opinion letter, we are of the opinion that:

1. CORPORATE STATUS, ETC. Each of the Borrower and its Subsidiaries
(i) is a validly existing corporation under the laws of the jurisdiction of
its formation and has the corporate power and authority to own its property
and assets and to transact the business in which it is engaged and
presently proposed to engage and (ii) to our knowledge, is duly qualified
and is authorized to do business and is in good standing in each
jurisdiction where it is required to be so qualified except where the
failure to be so qualified would not have a Material Adverse Effect.

2. SUBSIDIARIES. To our knowledge, Annex II to the Credit Agreement
correctly sets forth each Subsidiary of the Borrower and the ownership
interest of the Borrower therein.

3. CORPORATE POWER AND AUTHORITY, ETC. Each Credit Party has the
corporate or other organizational power and authority to execute, deliver
and carry out the terms and provisions of the Credit Documents to which it
is a party and has taken all necessary corporate or other organizational
action to authorize the execution, delivery and performance of the Credit
Documents to which it is a party.

4. CREDIT DOCUMENTS. Each Credit Party has duly executed and delivered
each Credit Document to which it is a party and each such Credit Document
to which it is a party constitutes the legal, valid and binding agreement
or obligation of such Credit Party enforceable against such Credit Party in
accordance with its terms, except to the extent that the enforceability
thereof may be limited by (i) applicable bankruptcy, insolvency,
reorganization, fraudulent transfer, moratorium or similar laws, and
related judicial doctrines, from time to time in effect affecting
creditors' rights and remedies generally, (ii) general principles of equity
(including, without limitation, standards of materiality, good faith, fair
dealing and reasonableness, equitable defenses and limits on the
availability of equitable remedies), whether such principles are considered
in a proceeding at law or in equity, and (iii) the qualification that
certain other provisions of such Credit Documents may be unenforceable in
whole or in part under the laws (including judicial decisions) of the State
of Ohio or other applicable jurisdictions, but the inclusion of such
provisions does not affect the validity as against any Credit Party of any
of such Credit Documents as a whole, and such Credit Documents contain
adequate provisions for enforcing payment of the obligations governed
thereby and for the realization of the principal rights and benefits
afforded thereby, subject to the other qualifications and limitations
contained in this opinion letter.

5. NO VIOLATION. Neither the execution, delivery or performance by any
Credit Party of the Credit Documents to which it is a party nor compliance
with the terms and provisions thereof, (i) will contravene any provision of
any State of Ohio or United States federal law, statute, rule, regulation
(including, without limitation, Regulations T and U of the Board of
Governors of the Federal Reserve System), or, to our knowledge, any order,
writ, injunction or decree of any court or governmental instrumentality
applicable to the Borrower or its properties and assets, (ii) will conflict
or result in any breach of, any of the terms, covenants, conditions or
provisions of, or constitute a default under, or result in the creation or
imposition of (or the obligation to create or impose) any Lien upon any of
the property or assets of any Credit Party pursuant to the terms of any
indenture, mortgage, deed of trust, or other material agreement or other
instrument, in each case of which we have knowledge to which any Credit
Party is a party or by which it or any of its property or assets are bound
or affected or (iii) will violate any provision of the charter, by-laws or
code of regulations of any Credit Party.

6. GOVERNMENTAL APPROVALS. No order, consent, approval, license,
authorization, or validation of, or filing, recording or registration with,
or exemption by, any Ohio or United States federal governmental or public
body or authority, or any subdivision thereof, is required to authorize or
is required as a condition to (i) the execution, delivery and performance
by any Credit Party of any Credit Document to which it is a party, or (ii)
the legality, validity, binding effect or enforceability of any such Credit
Document.

7. LITIGATION. To our knowledge, there are no actions, suits or
proceedings pending or, to, the knowledge of the Borrower, threatened with
respect to the Borrower or any of its Subsidiaries (i) that have, or could
reasonably be expected to have, a Material Adverse Effect, or (ii) which
question the validity or enforceability of any of the Credit Documents, or
of any action to be taken by any Credit Party pursuant to any of the Credit
Documents.

8. INVESTMENT COMPANY ACT, ETC. Neither the Borrower nor any of its
Subsidiaries is subject to regulation with respect to the creation or
incurrence of Indebtedness under the Investment Company Act of 1940, as
amended, the Interstate Commerce Act, as amended, the Federal Power Act, as
amended, the Public Utility Holding Company Act of 1935, as amended, or any
applicable Ohio state public utility law.

9. SENIOR DEBT. The Obligations constitute "Senior Indebtedness" as
such term is defined in the Indenture, dated as of May 5, 1999, relating to
the Borrower's $150,000,000 aggregate principal amount of 10.375% Senior
Subordinated Notes due May 1, 2007.

This opinion letter is being furnished only to the addresses and is solely
for their benefit and the benefit of their participants and assigns in
connection with the transactions contemplated by the Credit Documents. This
opinion letter may not be relied upon for any other purpose, or relied upon by
any other person, firm or corporation for any purpose, without our prior written
consent.

Very truly yours,

EXHIBIT E

----------------------------
FORM OF

ASSIGNMENT AGREEMENT
----------------------------

ASSIGNMENT AGREEMENT

DATED _____________

Reference is made to the Credit Agreement described in Item 2 of Annex I
annexed hereto (as such Credit Agreement may hereafter be amended, modified or
supplemented from time to time, the "CREDIT AGREEMENT"). Unless defined in Annex
I attached hereto, terms defined in the Credit Agreement are used herein as
therein defined.

_____________ (the "ASSIGNOR") and ______________ (the "ASSIGNEE") hereby
agree as follows:

1. The Assignor hereby sells and assigns to the Assignee without recourse
and without representation or warranty (other than as expressly provided
herein), and the Assignee hereby purchases and assumes from the Assignor, that
interest in and to all of the Assignor's rights and obligations under the Credit
Agreement as of the date hereof which represents the percentage interest
specified in Item 4 of Annex I (the "ASSIGNED SHARE") of all of Assignor's
outstanding rights and obligations under the Credit Agreement indicated in Item
4 of Annex I, including, without limitation, all rights and obligations with
respect to the Assigned Share of the Assignor's Commitment and of the Loans, the
Letters of Credit, and the Notes held by the Assignor. After giving effect to
such sale and assignment, the Assignee's Commitment will be as set forth in Item
4 of Annex I.

2. The Assignor (i) represents and warrants that it is duly authorized to
enter into and perform the terms of this Assignment Agreement, that it is the
legal and beneficial owner of the interest being assigned by it hereunder and
that such interest is free and clear of any liens or security interests; (ii)
makes no representation or warranty and assumes no responsibility with respect
to any statements, warranties or representations made in or in connection with
the Credit Agreement or the other Credit Documents or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Credit
Agreement or the other Credit Documents or any other instrument or document
furnished pursuant thereto; and (iii) makes no representation or warranty and
assumes no responsibility with respect to the financial condition of the
Borrower or any of its Subsidiaries or the performance or observance by the
Borrower of any of its obligations under the Credit Agreement or the other
Credit Documents or any other instrument or document furnished pursuant thereto.

3. The Assignee (i) represents and warrants that it is duly authorized to
enter into and perform the terms of this Assignment Agreement; (ii) confirms
that it has received a copy of the Credit Agreement and the other Credit
Documents, together with copies of the financial statements referred to therein
and such other documents and information as it has deemed appropriate to make
its own credit analysis and decision to enter into this Assignment Agreement;
(iii) agrees that it will, independently and without reliance upon the
Administrative Agent, the Assignor or any other Lender and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under the Credit
Agreement; (iv) appoints and authorizes the Administrative Agent to take such
action as agent on its behalf and to exercise such powers under the Credit
Agreement and the other Credit Documents as are delegated to the Administrative
Agent by the terms thereof, together with such powers as are reasonably
incidental thereto; [and] (v) agrees that it will perform in accordance with
their terms all of the obligations which by the terms of the Credit Agreement
are required to be performed by it as a Lender[; and (vi) to the extent legally
entitled to do so, attaches the forms described in section 5.4(b)(ii) of the
Credit Agreement (6)

4. Following the execution of this Assignment Agreement by the Assignor and
the Assignee, an executed original hereof (together with all attachments) will
be delivered to the Administrative Agent. The effective date of this Assignment
Agreement shall be the date of execution hereof by the Assignor, the Assignee
and the consent hereof by the Administrative Agent and the receipt by the
Administrative Agent of the administrative fee referred to

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

(6) If the Assignee isorganized under the laws of a jurisdiction outside the
United States.

in section 12.4(c) of the Credit Agreement, unless otherwise specified in Item 5
of Annex I hereto (the "SETTLEMENT DATE").

5. Upon the delivery of a fully executed original hereof to the
Administrative Agent, as of the Settlement Date, (i) the Assignee shall be a
party to the Credit Agreement and, to the extent provided in this Assignment
Agreement, have the rights and obligations of a Lender thereunder and under the
other Credit Documents and (ii) the Assignor shall, to the extent provided in
this Assignment Agreement, relinquish its rights and be released from its
obligations under the Credit Agreement and the other Credit Documents.

6. It is agreed that upon the effectiveness hereof, the Assignee shall be
entitled to (1) all interest on the Assigned Share of the Loans at the rates
specified in Item 6 of Annex I, (2) all Facility Fee on the Assigned Share of
the Commitment at the rate specified in Item 7 of Annex I, and (3) all Letter of
Credit Fees on the Assignee's participation in all Letters of Credit at the rate
specified in Item 8 of Annex I hereto, which, in each case, accrue on and after
the Settlement Date, such interest and Facility Fee and Letter of Credit Fees,
to be paid by the Administrative Agent, upon receipt thereof from the Borrower,
directly to the Assignee. It is further agreed that all payments of principal
made by the Borrower on the Assigned Share of the Loans which occur on and after
the Settlement Date will be paid directly by the Administrative Agent to the
Assignee.

7. Upon the Settlement Date, the Assignee shall pay to the Assignor an
amount specified by the Assignor in writing which represents the Assigned Share
of the principal amount of the respective Loans made by the Assignor pursuant to
the Credit Agreement which are outstanding on the Settlement Date, net of any
closing costs, and which are being assigned hereunder. The Assignor and the
Assignee shall make all appropriate adjustments in payments under the Credit
Agreement for periods prior to the Settlement Date directly between themselves
on the Settlement Date.

8. THIS ASSIGNMENT AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF OHIO.

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

[NAME OF ASSIGNOR], [NAME OF ASSIGNEE],
as Assignor as Assignee

By:_________________________________ By:_________________________________
Vice President Vice President

Acknowledged and agreed.

KEYBANK NATIONAL ASSOCIATION,
as Administrative Agent

By:_________________________________
Vice President

ANNEX I
FOR
ASSIGNMENT AND ASSUMPTION AGREEMENT

8. The Borrower:

XX-XXX STORES, INC.

2. Name and Date of Credit Agreement:

Credit Agreement, dated as of May 5, 1999, among Xx-Xxx Stores,
Inc., the Lenders from time to time party thereto, and KeyBank
National Association, as Administrative Agent.

3. Date of Assignment Agreement:

--------- ---, -----

4. Amounts (as of date of item #3 above):

-----------------------------------------------------------------------------
General General Swing Line Swing Line
Revolving Revolving Commitment Loans
Commitment Loans
-----------------------------------------------------------------------------

Aggregate Amount $____ $_____
for all Lenders
-----------------------------------------------------------------------------
Assigned Share _____% _____%
-----------------------------------------------------------------------------
Amount of $_____ $_____
Assigned Share
-----------------------------------------------------------------------------
Amount Retained $_____ $_____
by Assignor
-----------------------------------------------------------------------------

5. Settlement Date:

--------- ---, ---

6. Rate of Interest to the Assignee:

As set forth in section 2.6 of the Credit Agreement (unless
otherwise agreed to by the Assignor and the Assignee).(7)

(7) The Borrower and the Administrative Agent shall direct the entire amount of
the interest to the Assignee at the rate set forth in section 2.6 of the
Credit Agreement, with the Assignor and Assignee effecting any agreed upon
sharing of interest through payments by the Assignee to the Assignor.

7. Facility
Fee:

As set forth in section 4.1(a) of the Credit Agreement
(unless otherwise agreed to by the Assignor and the
Assignee).(8)

8. Letter of
Credit Fees:

As set forth in section 4.1(b) of the Credit Agreement
(unless otherwise agreed to by the Assignor and the
Assignee).(9)

9. Notices:

ASSIGNOR: ASSIGNEE:

Attention:__________________ Attention:__________________
Telephone: Telephone:
Facsimile: Facsimile:

10. Payment Instructions:

ASSIGNOR: ASSIGNEE:

ABA No.: ABA No.:
Account No.: Account No.:
Ref.: Xx-Xxx Stores, Inc. Ref.: Xx-Xxx Stores, Inc.

Attention:__________________ Attention:__________________
Telephone: Telephone:
Facsimile: Facsimile:

----------------------------
(8) The Borrower and the Administrative Agent shall direct the entire amount of
the Facility Fee to the Assignee at the rate set forth in section 4.1(a) of
the Credit Agreement, with the Assignor and the Assignee effecting any
agreed upon sharing of Facility Fee through payment by the Assignee to the
Assignor.

(9) The Borrower and the Administrative Agent shall direct the entire amount of
the Letter of Credit Fees to the Assignee at the rate set forth in section
4.1(b) of the Credit Agreement, with the Assignor and the Assignee
effecting any agreed upon sharing of the Letter of Credit Fees through
payment by the Assignee to the Assignor.

EXHIBIT F

SECTION 5.4(b)(ii) CERTIFICATE

Reference is hereby made to the Credit Agreement, dated as of May 5, 1999,
among Xx-Xxx Stores, Inc., the financial institutions party thereto from time to
time, and KeyBank National Association, as Administrative Agent (the "CREDIT
AGREEMENT"). Pursuant to the provisions of section 5.4(b)(ii) of the Credit
Agreement, the undersigned hereby certifies that it is not a "bank" as such term
is used in section 881(c)(3)(A) of the Internal Revenue Code of 1986, as
amended.

[NAME OF BANK]

By:_________________________________
Title:

Dated:__________

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DATED AS OF MAY 5, 1999 AMONG JO-ANN STORES, INC. AS BORROWER THE LENDING INSTITUTIONS NAMED THEREIN AS LENDERS

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