Angelica_DIPmotion by WSJ.com

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WEIL, GOTSHAL & MANGES LLP 767 Fifth Avenue New York, New York 10153 Telephone: (212) 310-8000 Facsimile: (212) 310-8007 Matthew S. Barr Jill Frizzley Kevin Bostel Proposed Counsel for Debtors and Debtors in Possession UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK ---------------------------------------------------------------x In re: : : ANGELICA CORPORATION, et al., : : Debtors.1 : : ---------------------------------------------------------------x

Chapter 11 Case No. 17-10870 (JLG) (Joint Administration Pending)

MOTION OF DEBTORS PURSUANT TO 11 U.S.C. §§ 105, 361, 362, 363, AND 364 AND FED. R. BANKR. P. 4001, AND LOCAL RULES 4001-1 AND 4001-2 FOR AUTHORITY TO (A) OBTAIN POSTPETITION FINANCING, (B) USE CASH COLLATERAL, (C) GRANT CERTAIN PROTECTIONS TO PREPETITION SECURED PARTIES, AND (D) RELATED RELIEF TO THE HONORABLE UNITED STATES BANKRUPTCY JUDGE: Angelica Corporation (“Angelica Corp.”) and its affiliates, as debtors and debtors in possession in the above-captioned chapter 11 cases (collectively, the “Debtors” or “Angelica”), respectfully represent:

The Debtors in these chapter 11 cases, along with the last four digits of each Debtor’s federal tax identification number, are as follows: Angelica Corporation (5260); Clothesline Holdings, Inc. (1081); Angelica Textile Services, Inc.–NY (6508); Royal Institutional Services, Inc. (8906); and Angelica Textile Services, Inc.–CA (5010). The location of the Debtors’ corporate headquarters is 1105 Lakewood Parkway, Suite 210, Alpharetta, Georgia 30009.

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Preliminary Statement As described in greater detail in the Declaration of John Makuch Pursuant to Rule 1007-2 of the Local Bankruptcy Rules for the Southern District of New York, filed contemporaneously herewith (Docket No. 3) (the “Makuch Declaration”), the Debtors are commencing these chapter 11 cases on a consensual basis with their prepetition secured lenders to effectuate a sale of substantially all of their assets. The Debtors’ Prepetition Senior Lenders (as defined below) have agreed to provide postpetition financing that will allow the Debtors to preserve and maximize the value of their assets through an auction process (the “Sale Process”) in which the Debtors’ Prepetition Junior Lenders (as defined below) have provided a stalking horse bid for the assets (the “Stalking Horse Bid”). The proposed Postpetition Facility (as defined below) provides the Debtors with the necessary liquidity and time to implement the Sale Process, and the consideration provided for in the Stalking Horse Bid will provide the necessary funding for a subsequent orderly wind down of these chapter 11 cases. Overview of Proposed Postpetition Facility2 1.

The Debtors propose to enter into a senior secured postpetition revolving

loan facility of up to $65 million with certain of their prepetition first-lien lenders (the “Postpetition Facility”) and to use cash collateral to fund their operations through the completion of the Sale Process. The financing on the terms set forth in the Senior Secured, Super-Priority Debtor-in-Possession Loan and Security Agreement, dated as of April 3, 2017, substantially in the form attached hereto as Exhibit A (the “Postpetition Loan Agreement” and,

This summary is qualified in its entirety by reference to the applicable provisions of the Postpetition Loan Documents and/or the Interim Order. To the extent there are any inconsistencies between this summary and the provisions of the Postpetition Loan Documents or the Interim Order, the provisions of the Postpetition Loan Documents and the Interim Order shall control. Any capitalized terms used but not otherwise defined in the summary shall have the respective meanings ascribed to such terms in the Postpetition Loan Documents and/or the Interim Order, as applicable.

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together with all related credit documents, the “Postpetition Loan Documents”), the proposed interim order attached hereto as Exhibit B (the “Interim Order”), the initial budget attached to the Interim Order as Exhibit A (the “Budget”), and the use of cash collateral (as such term is defined in section 363(a) of the Bankruptcy Code) authorized under the Interim Order represents the best available interim solution to the Debtors’ near-term liquidity needs. 2.

The Postpetition Facility is composed of an asset-based revolving credit

facility, a letter of credit subfacility, and a swingline loan subfacility (the borrowings under each, the “DIP Obligations”), and is provided by Wells Fargo Capital Finance, LLC (in its individual capacity, “Wells Fargo”), as administrative agent and collateral agent (in such capacity, the “Postpetition Agent”) for itself and Regions Bank (collectively with Wells Fargo, the “Postpetition Lenders”). The Postpetition Lenders are also the Prepetition Senior Lenders, and in such capacity, have been supportive of the Debtors’ sale process by, among other things, continuing to fund Angelica prior to the Commencement Date and granting certain concessions under the Prepetition Senior Loan Agreement (as defined below), in order to give Angelica sufficient time to finalize key components of the contemplated sale process and maximize the value of their collateral. 3.

The Debtors are also seeking authority to use the Prepetition Senior

Lenders’ cash collateral (as such term is defined by section 363(a) of the Bankruptcy Code, “Cash Collateral”) pursuant to this Motion in order to fund the cash needs related to their operations while they conduct the Sale Process. The Debtors’ access to sufficient working capital and liquidity and incurrence of the additional secured indebtedness under the Postpetition Facility is vital to Angelica’s ability to pursue its chapter 11 strategy of completing a value maximizing sale.

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As further described herein, the Prepetition Senior Lenders have agreed to

provide postpetition financing and have consented to the priming of their liens in exchange for certain customary protections, including the granting of certain liens and superpriority administrative expense status to the Prepetition Secured Parties as adequate protection. The DIP Obligations will be secured by, among other interests, a priming first priority lien on the collateral of the Prepetition Senior Lenders. In addition, the terms of the Postpetition Facility contemplate a “creeping” roll-up of the outstanding funded obligations under the Prepetition ABL Facility (the “Roll-Up”) in the amount of approximately $53.7 million. As described further herein and in the Declaration of Brad Jordan in Support of Debtors’ Motion for Approval of and Authority to Enter into Postpetition Financing and Use Cash Collateral filed contemporaneously herewith (the “Jordan Declaration”), no parties in interest will be prejudiced by the Roll-Up because (i) the Prepetition Senior Lenders are oversecured as of the Commencement Date, and (ii) parties will be given an opportunity to challenge the Prepetition Senior Lenders’ liens in the Debtors’ chapter 11 cases. (See Jordan Decl. ¶ [22]). 5.

Subject to Court approval, the Debtors expect to have approximately $10

million in incremental available liquidity upon entry of an interim order approving the Postpetition Facility and use of Cash Collateral. (See Jordan Decl. ¶ [17]). 6.

The Postpetition Facility preserves the status quo, and provides the

Debtors with sufficient liquidity to fund the business during the Sale Process in order to pursue and consummate a successful asset sale. It contains the best available pricing in the cirumstances and was negotiated in good faith and at arms’ length. As discussed below and in the Jordan Declaration, not only is the Postpetition Facility the Debtors’ most attractive postpetition financing option available, it is the Debtors’ only option at this time as no other potential

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postpetition lender was willing to lend into a non-consensual priming situation, provide financing on a junior basis, or satisfy the Prepetition Senior Lenders in full prior to extending additional credit. Accordingly, the Postpetition facility should be approved by the Court. (See Jordan Decl. ¶¶ [11–18, 24–29]). 7.

In accordance with Bankruptcy Rules 4001(b), (c), and (d) and Rule

4001-2(a) of the Local Rules of Bankruptcy Procedure for the Southern District of New York (the “Local Rules”), the following table summarizes the significant terms of the Interim Order and the Postpetition Loan Documents:

SUMMARY OF POSTPETITION FACILITY

Borrowers Fed. R. Bankr. P. 4001(c)(1)(B)

Angelica Corp (a Missouri corporation); Clothesline Holdings, Inc. (a Delaware corporation) (“Holdings”), Angelica Textile Services, Inc. (a California corporation) (“Services CA”), Angelica Textile Services, Inc. (a New York corporation) (“Services NY”), and Royal Institutional Services, Inc. (a Massachusetts corporation) (“RIS”). See Interim Order, Introduction; Postpetition Loan Agreement, Preamble.

Guarantors Fed. R. Bankr. P. 4001(c)(1)(B)

Each Borrower has agreed to guarantee the obligations of each of the other Borrowers. See Postpetition Loan Agreement, Recitals.

Postpetition Lenders Fed. R. Bankr. P. 4001(c)(1)(B)

Wells Fargo and Regions Bank. See Interim Order, Introduction; Postpetition Loan Agreement, Preamble.

Postpetition Agent Fed. R. Bankr. P. 4001(c)(1)(B)

Wells Fargo. See Interim Order, Introduction; Postpetition Loan Agreement, Preamble.

Postpetition Facility Fed. R. Bankr. P. 4001(c)(1)(B); Local Rule 4001-2(a)(ii)

Senior secured, super-priority revolving credit facility up to $65,000,000. See Interim Order, Introduction; Postpetition Loan Agreement, Recitals, § 2.1.

Borrowing Limits Fed. R. Bankr. P. 4001(c)(1)(B)

Maximum aggregate principal amount of Revolving Loans available under the Postpetition Loan Agreement of $65,000,000.00. See Interim Order, ¶ 7; Postpetition Loan Agreement, § 2.1.

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Budget Fed. R. Bankr. P. 4001(c)(1)(B); Local Rule 4001-2(a)(2)

Use of DIP Proceeds Fed. R. Bankr. P. 4001(c)(1)(B); Local Bankruptcy Rule 4001-2(a)(6)-(a)(7)

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Borrowers must, at all times, be in Substantial Compliance with the Approved Budget. Substantial Compliance means (a) with respect to the aggregate amount of expenditures shown in any Approved Budget for any four week period, an amount not to exceed 107.5% of the amount shown in the applicable Approved Budget for such period, and (b) with respect to Borrowers’ aggregate income for any four week period shown in the applicable Approved Budget, an amount not less than 92.5% of the amount shown for such period. See Interim Order, ¶ 8; Postpetition Loan Agreement, § 10.3. The Debtors may use the proceeds of the Postpetition Facility and the Cash Collateral solely to: (i) pay outstanding Postpetition Obligations; (ii) make the adequate protection payments with respect to the Prepetition Senior Obligations; (iii) pay the fees and transaction expenses associated with the closing of the transactions described in the Postpetition Loan Agreement; (iv) fund the Chapter 11 Cases in accordance with the Approved Budget (subject to Permitted Variances); and (v) make expenditures for the ongoing working capital requirements of the Debtors and for other general corporate purposes of the Debtors. See Interim Order, ¶ 7; Postpetition Loan Agreement, § 2.2.3.

Interest Rates Fed. R. Bankr. P. 4001(c)(1)(B)

Interest Rate: 4.00 % (the “Applicable Margin”) plus the greatest of (i) the LIBOR Rate plus 1.0%; (ii) the Postpetition Agent’s publicly announced “prime rate”; (iii) one-half of one percent per annum above the Federal Funds Rate; and (iii) one-month LIBOR + 1.00%. Default Interest Rate: 2.00% plus the applicable Interest Rate on such date. See Postpetition Loan Agreement, § 1.1.

Expenses and Fees Local Rule 40012(a)(3)

Unused Line Fee. a monthly fee equal to 0.50% per annum of the amount by which the average unpaid balance of outstanding loans and letter of credit obligations for any calendar month is less than the aggregate amount of the loans available to be drawn. LC Facility Fees. (i) a monthly fee equal to the Applicable Margin on a per annum basis based on the average amount available to be drawn under the outstanding letters of credit and all letters of credit that are paid or expire during the period of measurement; and (ii) all customary charges associated with the issuance, amending, negotiating, payment, processing and administration of all letters of credit. Audit and Appraisal Fees and Expenses. for field examinations, appraisals, and valuations fees and charges, as and when incurred or chargeable, as follows (i) a fee of $1,000 per day, per examiner, plus out-of-pocket expenses (including travel, meals, and lodging) for each field examination of any Borrower performed by personnel employed by the Prepetition Agent, and (ii) the fees or charges paid or incurred by the Prepetition Agent (but, in any event, no less than a charge of $1,000 per day, per person, plus out-of-pocket expenses (including travel, meals, and lodging)) if it elects to employ the services of one or more third persons to perform field examinations, to establish electronic collateral reporting systems, to appraise the Collateral, or any portion thereof, or to assess any Borrower’s or its subsidiaries' business valuation. Closing Fee. A closing fee equal to $325,000. Arrangement Fee. An arrangement fee equal to $50,000. Collateral Monitoring Fee. A fee of $3,000 per month for each month (or portion of a month) from and after the funding of the Prepetition Facility up to the date on which the Obligations (as defined in the Postpetition Loan Agreement) have been repaid in full and all obligations of the Prepetition Loan

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Agreement have been repaid in full and the Commitment Termination Date (as defined in the Postpetition Loan Agreement) has occurred, which fee shall be due and payable to Postpetition Agent for the benefit of Agent monthly in arrears. Bank Charges. Borrowers shall pay to Postpetition Agent, on demand, any and all out-of-pocket or reasonable fees, costs or expenses which Postpetition Agent pays to a bank or other similar institution arising out of or in connection with (i) the forwarding to a Borrower or any other Person on behalf of Borrower by Postpetition Agent of proceeds of loans made by the Postpetition Lenders to a Borrower pursuant to this Agreement and (ii) the depositing for collection by Postpetition Agent of any check, draft, or other item of payment payable to a Borrower received or delivered to Agent on account of the Obligations (as defined in the Postpetition Loan Agreement). Each Borrower acknowledges and agrees that Agent may charge such costs, fees and expenses to Borrowers based upon Agent’s good faith estimate of such costs, fees and expenses as they are incurred by Agent. See Interim Order, ¶ 6; Postpetition Loan Agreement, §§ 3.2, 3.4.1, 3.5, 13.31. Maturity Date Fed. R. Bankr. P. 4001(c)(1)(B); Local Rule 4001-2(a)(10)

July 2, 2017; Postpetition Loan Agreement, § 6.1.

Exit Financing Fed. R. Bankr. P. 4001(c)(1)(B); Local Rule 4001-2(a)

None.

Prepayments Local Rule 40012(a)(13)

Voluntary Prepayments: Permitted at any time, without premium or penalty (other than LIBOR breakage costs). Mandatory Prepayments: Customary mandatory prepayment events for financings of this type, including, prepayments from proceeds of (i) asset sales, (ii) insurance and condemnation proceeds, and (iii) equity or debt issuances. See Postpetition Loan Agreement, §§ 1.1, 5, 8.1.2.

Collateral and Priority Fed. R. Bankr. P. 4001(c)(1)(B)(ii); Local Rule 40012(a)(4)

First-priority priming lien on substantially all assets of the Debtors See Interim Order, ¶ 10; Postpetition Loan Agreement, § 7.

Conditions to Closing Fed. R. Bankr. P. 4001(c)(1)(B); Local Rule 4001-2(a)(2)

For the initial credit extension: (i) delivery of executed Postpetition Loan Documents to the Postpetition Agent; (ii) DIP Order prefects the liens of the Postpetition Agent on the Collateral and there are no other liens on the Collateral except for those permitted by the Postpetition Loan Agreement; (iii) delivery of certified organizational documents of each Borrower to the Postpetition Agent; (iv) delivery of a borrowing base certificate to the Postpetition Agent; (v) all fees under the Postpetition Loan Agreement have been paid; (vi) if letters of credit are to be issued, the conditions required for their issuance are satisfied; (vii) Borrowers shall have effective insurance coverage satisfactory to the Postpetition Agent; (viii) all representations and warranties made by any Borrower shall be true and correct; (ix) the Interim Order shall have been entered by the Court and the Interim Oder shall be in full force and effect. Upon each extension of credit: (a) the absence of litigation in relation to the Postpetition Loan Agreement or the Postpetition Loan Documents; (b) the delivery of each borrowing base certificate then required by the Postpetition Loan Agreement; (c) if letters of credit are to be issued, the conditions required for their issuance are satisfied; (d) Substantial Compliance with the Budget; (c) the absence of a Material Adverse Effect; (d) the absence of a Default or an Event of Default; and (e) the continuing effectiveness of the Interim Order or Final Order, as applicable. See Postpetition Loan Agreement, §§ 11.1, 11.2.

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Covenants Fed. R. Bankr. P. 4001(c)(1)(B); Local Rule 4001-2(a)(8)

Usual and customary for financings of this type, including, among other things: Affirmative Covenants: visits and inspections; notices; financial statement and other reporting; taxes; compliance with laws; insurance; use of proceeds; information related to prepetition junior loan documents; sale transaction milestones; chapter 11 pleadings; committee reports; compliance with approved budget. Negative Covenants: Limitations on: fundamental changes; loans; permitted debt; affiliate transactions; incurrence of liens; payments of certain debt; distributions; upstream payments; asset dispositions; forming of subsidiaries; making certain investments; change of fiscal year; change governing documents; entry into hedging agreements; non-compliance with anti-terrorism laws; conduct new business activities; and create new deposit or securities accounts. See Postpetition Loan Agreement, § 10.

Events of Default Fed. R. Bankr. P. 4001(c)(1)(B); Local Rule 4001-2(10)

Events of default include: (i) failure to pay any amount when due under either the Postpetition Facility or of more than a certain threshold amount of other postpetition obligations; (ii) material inaccuracy of any representation or warranty; (iii) noncompliance with covenants; (iv) occurrence of an event of default under any security document related to the Postpetition Facility; (v) cessation of a substantial part of the Borrowers’ business, taken as a whole; (vi) occurrence of a change of control; (vii) challenge by the Borrowers or their affiliates concerning the legality or enforceability of the Postpetition Loan Documents or the liens granted in favor of the Postpetition Agent shall cease to be in effect; (viii) occurrence of certain adverse ERISA events; (ix) entry of a judgement in an amount above a certain threshold against the Borrowers that is not subject to the automatic stay and for which enforcement proceedings have been commenced; (x) criminal conviction of any Borrower or senior office of a felony in the conduct of the business or under a law that will lead to a forfeiture of material collateral; (xi) bringing of a motion: (a) to obtain additional financing under section 364(c) or (d) of the Bankruptcy Code not otherwise permitted pursuant to the Postpetition Loan Agreement; (b) to grant any lien other than those permitted by the Postpetition Loan Agreement upon or affecting any Collateral; (c) except as provided in the DIP Order, to use cash collateral of Postpetition Agent under section 363(c) of the Bankruptcy Code without the prior written consent of the Postpetition Agent and the Lenders; or (d) any other action or actions adverse to either (i) the Postpetition Agent and the Posteptition Lenders or their rights and remedies hereunder or their interest in the Collateral or (ii) the Prepetition Senior Agent and the Prepetition Senior Secured Parties or their rights and remedies under the Prepetition Senior Loan Documents or their interest in their respective collateral; (xii) filing of any plan of reorganization or disclosure statement attendant thereto by a Borrower, or the entry of an order confirming such plan or approving such disclosure statement, (a) to which the Agent, Lenders, the Prepetition Senior Agent, and Prepetition Senior Lenders do not consent in writing or otherwise agree to the treatment of their respective claims or (b) that fails to provide for the payment in full in cash of all Obligations and Prepetition Senior Obligations (and the termination of all related lending commitments) on the effective date of such plan; (xiii) entry of an order confirming a plan reorganization that does not contain a provision for termination of the commitments and repayment in full in cash of all of the Obligations under the Postpetiton Loan Agreement and all of the Prepetition Senior Obligations on or before the effective date of such plan or plans; (xiv) entry of an order amending, supplementing, staying, vacating or otherwise modifying the Postpetition Loan Documents or the DIP Order without the written consent of the Agent and the Lenders or the filing by the Borrowers of a motion for reconsideration with respect to the DIP Order; (xv) Final Order is not entered by the earlier to occur of (a) immediately following the expiration of the Interim Order and (b) the date that is 30 days after the entry of the Interim Order; (xvi) payment of, or application for authority to pay, any Prepetition claim without the Postpetition Agent's and Lenders’ prior written consent unless otherwise expressly permitted; (xvii) entry of an order or judgment allowing, imposing, surcharging or assessing any claim, cost or expense against the Postpetition Agent, any Lender, the Prepetition Senior Agent, or any of the

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Prepetition Senior Secured Parties or against any of their respective collateral; (xviii) appointment of an interim or permanent trustee or the appointment of a receiver or an examiner with expanded powers to operate or manage the financial affairs, the business, or reorganization of any Borrower; (xix) sale, without the Postpetition Agent's, Lenders’, Prepetition Senior Agent's, and Prepetition Senior Lenders’ consent, of all or substantially all of any Borrower’s assets either through a sale under section 363 of the Bankruptcy Code that does not provide for payment in full in cash of the Obligations and the Prepetition Senior Obligations and termination of related lending commitments; (xx) dismissal of any Chapter 11 Case, or the conversion from one under chapter 11 to one under chapter 7 of the Bankruptcy Code; (xxi) entry of an order granting relief from or modifying the Automatic Stay; (xxii) allowing any creditor to execute upon or enforce a Lien on any Collateral, or (y) with respect to any Lien of or the granting of any Lien on any Collateral to any state or local environmental or regulatory agency or authority, which in either case is with respect to any portion of the Collateral having a value, individually or in the aggregate, in excess of $250,000; (xxiii) commencement of a suit or action against Postpetition Agent, any Lender, Prepetition Senior Agent, or any of the Prepetition Senior Secured Parties, by or on behalf of a Borrower; (xxiv) entry of any order in any suit or action against Postpetition Agent, any Lender, Prepetition Senior Agent, or any of the Prepetition Senior Secured Parties, that asserts or seeks by or on behalf of a Borrower, the Environmental Protection Agency, any state environmental protection or health and safety agency, any Committee or any other party in interest, (a) awarding any claim, stay, injunctive relief or other damages against Postpetition Agent, any Lender, Prepetition Senior Agent, or any of the Prepetition Senior Secured Parties; or (b) granting or awarding any legal or equitable remedy that would have the effect of subordinating any or all of the Obligations or liens of Postpetition Agent or any Lender under the Postpetition Loan Documents or DIP Order, or Prepetition Senior Agent or any of the Prepetition Senior Secured Parties under the Prepetition Senior Loan Documents or DIP Order, to any other claim; (xxv) entry of an order avoiding or requiring repayment of any portion of the payments made on account of the Obligations owing under the Postpetition Loan Agreement or the other Postpetition Loan Documents or on account of the Prepetition Senior Obligations owing under the Prepetition Senior Loan Agreement or Prepetition Senior Loan Documents; (xxvi) breach of and/or failure of any Borrower to perform any of its obligations under the DIP Order; (xxvii) entry of an order or judgment, or any Borrower applies for, consents to, or acquiesces in, the entry of such order or judgment modifying, limiting, subordinating or avoiding (a) the priority of any Obligations or Prepetition Senior Obligations or (b) the perfection, priority or validity of any Lien securing such Obligations or Prepetition Senior Obligations; or (xviii) entry of an order granting any other super priority administrative claim or lien (other than the Carve-Out) equal or superior to that granted to Postpetition Agent, on behalf of itself and Lenders, or Prepetition Senior Agent, on behalf of itself and Prepetition Senior Secured Parties, hereunder or under the DIP Order. See Interim Order, ¶ 35; Postpetition Loan Agreement, § 12.1. Milestones Fed. R. Bankr. P. 4001(c)(1)(B)(vi); Local Rule 40012(10)

(i) filing of a motion with the court to approve a sale (the “Approved Sale Motion”) pursuant to section 363 of the Bankruptcy Code within seven days after April 3, 2017 (the “Petition Date”); (ii) obtaining court approval of the Stalking Horse Bid 25 days after the Petition Date; (iii) the occurrence of the final auction of the assets 70 days after the Petition Date; (iv) the grant of the Approved Sale Motion by the court 75 days after the Petition Date; and (v) the closing and funding of the sale described in the Approved Sale Motion 85 days after the Petition Date. The contingencies to the Stalking Horse Bid set forth in section 10.1(e) and (f) of the Stalking Horse APA shall each have been waived by the Stalking Horse Bidder or otherwise satisfied on or before the date of the final hearing on the Sale Motion. See Interim Order, ¶ 15; Postpetition Loan Agreement, § 10.1.16.

Carve-Out Local Rule 4001-

The liens and claims granted to the Postpetition Agent, Postpetition Lenders, Prepetition Agents, or Prepetition Secured Lenders in the DIP Orders, the Postpetition Loan Documents, the Prepetition Senior

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2(a)(5)

Loan Documents and/or any Prepetition Junior Loan Documents are all subject to the following (collectively, the “Carve-Out”): (i) all fees payable pursuant to 28 U.S.C. § 1930; (ii) expenses up to $50,000 that would be necessary to fund a chapter 7 liquidation; and (iii) the payment of Retained Professionals (a) incurred prior to the delivery of the Carve-Out Trigger Notice, regardless of the amount or when approved, and (b) incurred on and after one day after delivery of the Carve-Out Trigger Notice in an aggregate amount not exceeding $250,000. See Interim Order, ¶ 13.

Use of Cash Collateral Fed. R. Bankr. P. 4001(b)(1)(B)(ii); Local Rule 40012(a)(ii)

Subject to the terms and conditions set forth in the DIP Orders and in the Postpetition Loan Documents, the Debtors may use the proceeds of the Postpetition Facility and the Cash Collateral solely to: (i) pay outstanding Postpetition Obligations as provided in the Postpetition Loan Documents and the DIP Orders, (ii) make the adequate protection payments required under the DIP Orders, and (iii) fund general corporate and working capital requirements of the Debtors constituting administrative expenses in the Chapter 11 Cases, in each case in accordance with the Approved Budget and the terms of the Postpetition Loan Documents. See Interim Order ¶ 7.

Duration of Use of Cash Collateral Fed. R. Bankr. P. 4001(b)(1)(B)(iii)

The earliest of (i) July 2, 2017, (ii) closing of a sale of substantially all of the Debtors’ assets pursuant to an Approved Sale Motion (as defined in the Postpetition Loan Agreement) and indefeasible payment in full of all Postpetition Obligations and Prepetition Senior Obligations, (iii) closing of any refinancing of the Prepetition Senior Obligations and Postpetition Obligations, (iv) the effective date of a plan of reorganization in the Chapter 11 Cases, (v) conversion or dismissal of any of the Chapter 11 Cases, (vi) the appointment of a trustee or examiner, and (vii) at the option of the Postpetition Agent in its sole discretion, the occurrence of any Event of Default (the date of the earliest such occurrence, the “Commitment Termination Date”). See Interim Order ¶ 4.

Liens, Cash Payments or Adequate Protection Provided for Use of Cash Collateral Fed. R. Bankr. P. 4001(b)(1)(B)(iv), (c)(1)(B)(ii)

Adequate Protection Senior Obligations. As adequate protection for the Prepetition Senior Agent’s interest in the Prepetition Senior Collateral, the Prepetition Senior Agent and Prepetition Senior Lenders will be granted the following: 

Liens and security interests in and on all of the Postpetition Collateral (the “Adequate Protection Senior Liens”). The Adequate Protection Senior Liens will (i) be subordinate only to: (A) the Carve-Out, (B) the Postpetition Liens, and (C) the Prior Liens; and (ii) be senior and superior to the Subordinate Liens and Related Rights and, pursuant to the Prepetition Intercreditor Agreement, the Prepetition Junior Liens;



An allowed super-priority administrative expense claim (the “Adequate Protection Senior Claim”) against each Debtor and its respective estate. The Adequate Protection Senior Claim will: (i) be subordinate only to: (A) the Carve-Out, and (B) the Super-Priority Claim; and (ii) be senior and superior to the Subordinate Claims and Related Rights;



(i) The proceeds of any Prepetition Senior Collateral and any Postpetition Collateral will be paid to the Prepetition Senior Agent and Prepetition Senior Lenders for application to the Prepetition Senior Obligations until such Prepetition Senior Obligations are paid in full or Cash Collateralized (as defined in the Prepetition Senior Loan Agreement), (ii) the Debtors will make all payments of interest as and when due under the Prepetition Senior Loan Agreement, and (iii) the Debtors will pay or reimburse the Prepetition Senior Agent and Prepetition Senior Lenders for fees, costs, expenses and charges payable under the Prepetition Senior Loan Documents;



The Adequate Protection Senior Liens and Adequate Protection Senior Claim will secure the payment of the Prepetition Senior Obligations in an amount equal to any diminution in the value of the Prepetition Senior Agent’s interests in the Prepetition Senior Collateral from and after the Petition Date (the amount of such diminution, the “Adequate Protection Senior Obligations”) including, without limitation, any such diminution resulting from the following: (i) the use by the Debtors of the Prepetition Senior Collateral, including, without limitation, the Cash Collateral, (ii) the imposition of the Postpetition Liens, which will prime the Primed Liens, (iii) the imposition of the automatic stay pursuant to section 362(a) of the Bankruptcy Code, (iv) the physical deterioration, consumption, use, sale, lease, disposition, shrinkage, or

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decline in market value of the Prepetition Senior Collateral or otherwise, or (v) costs and fees incurred in connection with the Prepetition Senior Loan Documents. Adequate Protection Junior Obligations. As adequate protection for any claim of the Prepetition Junior Agent and Prepetition Junior Lenders for diminution in the value of the Prepetition Junior Agent’s interests in the Prepetition Senior Collateral from and after the Petition Date (the amount of such diminution, the “Adequate Protection Junior Obligations”), the Prepetition Junior Agent and Prepetition Junior Lenders will be granted the following: 

Liens and security interests in and on all of the Postpetition Collateral (the “Adequate Protection Junior Liens”). The Adequate Protection Junior Liens will be entitled to the same rights, priorities, benefits and protections granted to or conferred upon the Adequate Protection Senior Liens under the DIP Orders, except that such Adequate Protection Junior Liens will be junior and subordinate to the Prepetition Senior Liens and the Adequate Protection Senior Liens.



An allowed super-priority administrative expense claim (the “Adequate Protection Junior Claim”) against each Debtor and its respective estate. The Adequate Protection Junior Claim will be entitled to the same rights, priorities, benefits and protections granted to or conferred upon the Adequate Protection Senior Claim under the DIP Orders, except that such Adequate Protection Junior Claim will be junior and subordinate to the Adequate Protection Senior Claim.



The Debtors will pay or reimburse the Prepetition Junior Agent and Prepetition Junior Lenders for any and all reasonable attorneys’ fees and expenses of the Prepetition Junior Agent and Prepetition Junior Lenders as provided in the Prepetition Junior Loan Agreement, whether accrued prepetition or postpetition, in an amount not to exceed the amounts set forth in the Approved Budget. See Interim Order ¶¶ 17, 18.

Liens on Avoidance Actions Fed. R. Bankr. P. 4001(c)(1)(B)(xi); Local Rule 40012(a)(i)(C)

As security for the full and timely payment of the Postpetition Obligations, the Postpetition Agent will be granted valid, binding, enforceable, unavoidable and fully perfected security interests, liens and mortgages (collectively, the “Postpetition Liens”) in and upon, among other things, all prepetition and postpetition causes of action (exclusive of actions for preferences, fraudulent conveyances, and other avoidance power claims under sections 544, 545, 547, 548, 549 and 550 of the Bankruptcy Code (the “Avoidance Actions”), but, only after entry of the Final Order, inclusive of the proceeds and recoveries from the Avoidance Actions (the “Avoidance Action Proceeds”)). See Interim Order ¶ 9.

Determination Regarding Prepetition Claim Fed. R. Bankr. P. 4001(c)(1)(B)(iii)

The Interim Order contains stipulations of fact by the Debtors, including those related to the validity and enforceability of the Debtors’ prepetition obligations and the Prepetition Agents’ and Prepetition Secured Lenders’ Liens under the Prepetition Senior Loan Documents and the Prepetition Junior Loan Documents. See Interim Order ¶ D.

Effect of Debtors’ Stipulations on Third Parties Fed. R. Bankr. P. 4001(c)(1)(B)(iii),(vii i)

The stipulations and admissions contained in the DIP Orders, shall be binding on all parties in interest, including, without limitation, the Creditors’ Committee, unless, and solely to the extent that, (a) the Creditors’ Committee files a complaint and commences an adversary proceeding challenging the amount, extent, validity, or enforceability of the Prepetition Senior Obligations and/or the Prepetition Junior Obligations, or the perfection or priority of the Prepetition Senior Liens and/or the Prepetition Junior Liens, or otherwise asserting any claims or causes of action on behalf of the Debtors’ estates against the Prepetition Senior Agent or the Prepetition Senior Lenders relating to the Prepetition Senior Obligations, or the Prepetition Junior Agent or Prepetition Junior Lenders relating to the Prepetition Junior Obligations, in each case no later than the earlier of (x) sixty (60) days after the date of appointment of the Creditors’ Committee or (y) seventy-five (75) days after the Petition Date (such

The Creditors’ Committee or any other party with standing shall have earlier of (x) sixty (60) days after the date of appointment of the Creditors’ Committee or (y) seventy-five (75) days after the Petition Date to investigate and challenge the validity of the interests of the Prepetition Secured Lenders and the Prepetition Agents in the Prepetition Senior Collateral. See Interim Order ¶ 30.

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earlier date, the “Complaint Filing Deadline”), and (b) the Court rules in favor of the plaintiff in such adversary proceeding. Notwithstanding anything to the contrary in the DIP Orders, if any such adversary proceeding is timely commenced, the stipulations contained in the DIP Orders will nonetheless remain binding on all parties in interest and preclusive except to the extent that such stipulations are expressly challenged in such adversary proceeding. See Interim Order ¶ 30. Waiver or Modification of the Automatic Stay Fed. R. Bankr. P. 4001(c)(1)(B)(iv)

The automatic stay will be modified as to the Postpetition Agent and Postpetition Lenders to the extent necessary to permit them to perform in accordance with, provide any notice under, and exercise, enjoy and enforce their respective rights, benefits, privileges and remedies pursuant to the DIP Orders and the other Postpetition Loan Documents. The Postpetition Agent and Postpetition Lenders will be authorized and granted leave from the automatic stay to do the following on and after the occurrence and continuation of an Event of Default under the Postpetition Loan Agreement (or otherwise on and after the Commitment Termination Date), in each case without further notice, motion or application to, order of, or hearing before, this Court:  terminate any obligation of Postpetition Agent or Postpetition Lenders to make loans or other extensions of credit under the Postpetition Loan Documents or the DIP Orders;  declare all Postpetition Obligations immediately due and payable in full in cash, and require that all letters of credit and other contingent obligations related thereto, if any, to be cash collateralized or terminated without liability to Postpetition Agent or Postpetition Lenders;  revoke the Debtors’ right, if any, under the DIP Orders and/or the other Postpetition Loan Documents to use Cash Collateral; and  receive and apply proceeds of Postpetition Collateral to the Postpetition Obligations and Prepetition Senior Obligations in accordance with the terms and conditions of the DIP Orders and the Postpetition Loan Documents. On and after the occurrence and continuation of an Event of Default under the Postpetition Loan Agreement (or otherwise on and after the Commitment Termination Date), and after obtaining Court approval upon notice and hearing, the Postpetition Agent and the Postpetition Lenders will be entitled to foreclose or otherwise enforce their respective liens on any or all of the Postpetition Collateral and/or to exercise any other default-related rights and remedies under the Postpetition Loan Documents, the DIP Orders and applicable law. See Interim Order ¶ 27.

Waiver or Modification of Applicability of Non-Bankruptcy Law Relating to the Perfection or Enforcement of a Lien Fed. R. Bankr. P. 4001(c)(1)(B)(vii)

To the extent that any applicable non-bankruptcy law would otherwise restrict the grant, scope, enforceability, attachment or perfection of the security interests and liens authorized or created under or in connection with the DIP Orders or the Postpetition Loan Documents, or otherwise would impose filing or registration requirements or fees and charges with respect thereto, such law will be pre-empted to the maximum extent permitted by the United States Constitution, the Bankruptcy Code, applicable federal law, and the judicial power of the United States Bankruptcy Court. See Interim Order, ¶ 22.

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Section 506(c) Waiver Fed. R. Bankr. P. 4001(c)(1)(B)(x)

Only after entry of the Final Order, no costs or expenses of administration or other charge, lien, assessment or claim incurred on or after the Petition Date of any Person or entity will be imposed against the Postpetition Agent, Postpetition Lenders, Prepetition Agents, or Prepetition Secured Lenders, their respective claims or the Prepetition Senior Collateral or Postpetition Collateral under section 506(c) of the Bankruptcy Code or otherwise, and the Debtors will waive any and all such rights, remedies and benefits under section 506(c) of the Bankruptcy Code. See Interim Order ¶ 20.

Section 552(b) Waiver Fed. R. Bankr. P. 4001(c)(1)(B)

Only after entry of the Final Order, the Postpetition Agent, the Prepetition Agents, the Postpetition Lenders, and the Prepetition Secured Lenders will not be subject to the equitable doctrine of “marshaling”, “election of remedies” or any other similar doctrine, or an “equities of the case” claim under section 552(b) of the Bankruptcy Code, in each case with respect to any of its respective interests in the Postpetition Collateral and Prepetition Senior Collateral. See Interim Order ¶ 31.

Release, Waivers or Limitation on any Claim or Cause of Action Fed. R. Bankr. P. 4001(c)(1)(B)(viii)

The Debtors will irrevocably waive any right to challenge or contest the Prepetition Senior Liens and/or the Prepetition Junior Liens and the validity of the Prepetition Senior Obligations and/or the Prepetition Junior Obligations; provided that, subject to paragraph 29 of the Interim Order and the time limitations specified in paragraph 30 of the Interim Order, the acknowledgments or agreements by the Debtors contained in the stipulations shall not be binding on any other party and shall not affect the rights of any committee, Person or entity (other than the Debtors with respect to the acknowledgements and agreements set forth in the stipulations) with respect to their rights to assert, pursue or otherwise allege any of the claims and actions described in paragraph 30 of the Interim Order. See Interim Order ¶¶ D, 29, 30.

Background 8.

On the date hereof (the “Commencement Date”), the Debtors each

commenced with the Court a voluntary case under chapter 11 of title 11 of the United States Code (the “Bankruptcy Code”).

The Debtors are authorized to continue to operate their

business and manage their properties as debtors in possession pursuant to sections 1107(a) and 1108 of the Bankruptcy Code. No trustee, examiner, or statutory committee of creditors has been appointed in these chapter 11 cases. 9.

Contemporaneously herewith, the Debtors have filed a motion requesting

joint administration of the chapter 11 cases pursuant to Rule 1015(b) of the Federal Rules of Bankruptcy Procedure (the “Bankruptcy Rules”).

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Information regarding the Debtors’ business, capital structure, and the

circumstances leading to the commencement of these chapter 11 cases is set forth in the Makuch Declaration which is incorporated by reference herein. Jurisdiction 11.

The Court has jurisdiction to consider this matter pursuant to 28 U.S.C.

§§ 157 and 1334. This is a core proceeding pursuant to 28 U.S.C. § 157(b). Venue is proper before the Court pursuant to 28 U.S.C. §§ 1408 and 1409. Relief Requested 12.

By this Motion, pursuant to sections 105, 361, 362, 363, and 364 of the

Bankruptcy Code, the Debtors request entry of the Interim Order and a proposed final order to be filed with the Court (the “Final Order” and, together with the Interim Order, the “DIP Orders”) in connection with the Final Hearing (as defined below) (the “Final Order” and, together with the Interim Order, the “DIP Orders”), granting, among other things, the following relief: (a)

authorizing Holdings, Services CA, Services NY, and RIS to be the borrowers (in such capacity, collectively the “Borrowers”) and to obtain postpetition financing in an aggregate principal amount not to exceed $65 million under the Postpetition Facility;

(b)

authorizing the Debtors to execute and enter into the Postpetition Loan Documents and to perform all such other and further acts as may be necessary or appropriate in connection with the Postpetition Loan Documents;

(c)

authorizing the Debtors to grant security interests, liens, and superpriority claims (including a superpriority administrative claim pursuant to section 364(c)(1) of the Bankruptcy Code, liens pursuant to sections 364(c)(2) and 364(c)(3) of the Bankruptcy Code, and priming liens pursuant to section 364(d) of the Bankruptcy Code), to secure all obligations of the Debtors under and with respect to the Postpetition Facility;

(d)

authorizing the Debtors’ limited use of Cash Collateral solely on the terms and conditions set forth in the Interim Order and in the Postpetition Loan Documents;

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(e)

granting adequate protection to the Prepetition Senior Lenders and Prepetition Junior Lenders (as defined in the Interim Order), whose liens and security interests are being primed by the Postpetition Facility;

(f)

modifying the automatic stay under section 362 of the Bankruptcy Code on the terms set forth herein to the extent necessary to implement the terms of the Postpetition Loan Documents and the DIP Orders;

(g)

waiver of any applicable stay (including a stay pursuant to Bankruptcy Rule 6004) with respect to the effectiveness or enforceability of the Interim Order; and

(h)

scheduling of a final hearing (the “Final Hearing”) pursuant to Bankruptcy Rule 4001 and Local Rule 4001-2 to be held within 30 days following the entry of the Interim Order to consider entry of the Final Order and to approve notice procedures with respect thereto. Debtors’ Prepetition Secured Indebtedness 13.

The Debtors have two tiers of prepetition secured indebtedness: first-lien

indebtedness under the Prepetition Senior Loan Agreement (as defined below) and second-lien indebtedness under the Prepetition Junior Credit Agreement (as defined below). As of the Commencement Date, the Debtors’ outstanding prepetition secured indebtedness is in the aggregate amount of approximately $139.8 million. A. Debtors’ Prepetition Senior Secured Indebtedness 14.

Pursuant to that certain Loan and Security Agreement, dated as of July 15,

2011 (as amended, restated, supplemented or otherwise modified from time to time, the “Prepetition Senior Loan Agreement”), among each Borrower (with Holdings party thereto as a guarantor), Wells Fargo, as administrative agent and collateral agent (in such capacity, the “Prepetition Senior Agent”), and the other lenders party thereto (collectively, together with the Secured Parties (as defined in the Prepetition Senior Loan Agreement), the “Prepetition Senior Lenders”), the Prepetition Senior Agent and Prepetition Senior Lenders made available to the Debtors a reserve-based revolving credit facility in an aggregate principal amount of up to $90 million (the “Prepetition ABL Facility”). 15 WEIL:\96030439\10\15465.0003

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The funds available under the Prepetition ABL Facility are available for

working capital and other general corporate purposes, including the issuance of letters of credit and any such issuance of letters of credit reduce the amount available on a dollar for dollar basis. Availability under the Prepetition ABL Facility is capped by a borrowing base, which is calculated based on certain percentages of the value of the Debtors’ inventory, fixed assets and receivables and subject to certain reserves and an availability block. 16.

Pursuant to the Security Documents (as defined in the Prepetition Senior

Loan Agreement) (as such documents are amended, restated, supplemented or otherwise modified from time to time, the “Prepetition Senior Security Documents”), by and between each of the Debtors and the Prepetition Senior Agent, each Debtor granted to the Prepetition Senior Agent, for the benefit of itself and the Prepetition Senior Lenders, to secure obligations arising under the Prepetition Senior Loan Agreement, a first priority security interest in and continuing lien (the “Prepetition Senior Liens”) on substantially all of such Debtor’s assets and property, and all proceeds, products, accessions, rents and profits thereof, in each case whether then owned or existing or thereafter acquired or arising (the “Prepetition Senior Collateral”). 17.

As of the Commencement Date, the aggregate amount outstanding under

the Prepetition ABL Facility was approximately $53.7 million, including approximately $29.9 million in issued but undrawn letters of credit. The Prepetition ABL Facility matures on May 23, 2019. B. Debtors’ Prepetition Junior Secured Indebtedness 18.

Pursuant to that certain Amended and Restated Loan Agreement, dated as

of July 12, 2016 (as amended, restated, supplemented or otherwise modified from time to time, the “Prepetition Junior Credit Agreement”), among each Borrower (with Holdings, Services

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CA, Services NY, and RIS as guarantors), and Cortland Capital Market Services LLC, as administrative agent and collateral agent for itself and the Prepetition Junior Lenders (as defined below) (in such capacity, the “Prepetition Junior Agent” and, together with the Prepetition Senior Agent, the “Prepetition Agents”), and the other lenders party thereto (collectively, the “Prepetition Junior Lenders” and, together with the Prepetition Senior Lenders, the “Prepetition Secured Lenders”), the Prepetition Junior Lenders agreed to extend term loans to the Debtors in an aggregate principal amount of $80,500,000. 19.

Pursuant to the Security Documents (as defined in the Prepetition Junior

Credit Agreement) (as such documents are amended, restated, supplemented or otherwise modified from time to time, the “Prepetition Junior Security Documents”), by and between each of the Debtors and the Prepetition Junior Agent, each Debtor granted to the Prepetition Junior Agent, for the benefit of itself and the Prepetition Junior Lenders, to secure the obligations arising under the Prepetition Junior Credit Agreement, a second priority security interest in and continuing lien (the “Prepetition Junior Liens”) in the Prepetition Senior Collateral. 20.

As of the Commencement Date, the aggregate amount outstanding under

the Prepetition Junior Credit Agreement was approximately $86.5 million. C. Prepetition Intercreditor Agreement 21.

Pursuant and subject to that certain Intercreditor Agreement, dated as of

August 20, 2013 (as amended, restated, supplemented or otherwise modified from time to time, the “Prepetition Intercreditor Agreement”), by and between the Prepetition Senior Agent, on behalf of itself and the Prepetition Senior Lenders, and the Prepetition Junior Agent, on behalf of itself and the Prepetition Junior Lenders (and acknowledged by the Debtors), the Prepetition Junior Agent has agreed: (a) to subordinate its liens in the Prepetition Senior Collateral to the

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Postpetition Liens (as defined below) and the Carve-Out (as defined below) to the extent that the Prepetition Senior Liens are subordinated to the Postpetition Liens and the Carve-Out, and (b) that it will not request adequate protection or any other relief in connection with the Debtorsâ&#x20AC;&#x2122; entry into the Postpetition Facility or their use of Cash Collateral, subject to certain limited exceptions set forth in Section 6 of the Prepetition Intercreditor Agreement. Debtors Require Postpetition Financing and Use of Cash Collateral 22.

The Debtors require the financing available under the Postpetition Facility

and the use of cash collateral to have sufficient liquidity to operate their business and administer their estates during the Sale Process. As the result of declining revenues from increased pricing pressures from their customers and a more challenging operating environment, the Debtors have been unable to generate operating revenues at their historical rates. Moreover, all of the Debtorsâ&#x20AC;&#x2122; cash is subject to the liens of their secured creditors. Consequently, the Debtors require the Postpetition Facility and the use of cash collateral as a critical, value-maximizing element of their sale process. 23.

Access to the Postpetition Facility and the use of cash collateral is

essential for the Debtors to assure their employees, customers, and vendors that the Debtors have sufficient capital to continue their operations in the ordinary course and to pursue a successful asset sale. Within days of the commencement of these chapter 11 cases, Debtors will not have sufficient liquidity to fund certain material obligations, including payroll items. Furthermore, several key suppliers and vendors have recently demanded cash-in-advance payment or up-front deposits, and, in some instances, have ceased shipping to the Debtors. Thus, without access to interim funding under the Postpetition Facility and the use of cash collateral, the Debtorsâ&#x20AC;&#x2122; ability to continue their operations would be in serious jeopardy. Interim funding in the amount of

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$37,625,000 million and immediate access to cash collateral will permit the Debtors to operate as they did prepetition and will restore the confidence of their key stakeholders at this critical stage. Accordingly, the Postpetition Facility and the use of cash collateral as provided in the Interim Order are essential to the Debtors’ ability to minimize disruptions and avoid irreparable harm to their business. Postpetition Facility Provides Significant Liquidity and Flexibility 24.

The Postpetition Loan Agreement addresses the Debtors’ liquidity needs

by permitting the Debtors to draw up to $37,625,000 upon entry of the Interim Order and, upon entry of the Final Order, draw up to an additional $27,375,000. The Debtors’ obligations under the Postpetition Loan Agreement are secured by a priming, first-priority postpetition security interest in and lien on all prepetition and postpetition real and personal, tangible and intangible property and assets of each of the Debtors, the Prepetition Senior Collateral, and the proceeds, products, offspring, rents and profits of all of the foregoing, including insurance proceeds (collectively, the “Postpetition Collateral”; such security interests and liens, the “Postpetition Liens”). (See Jordan Decl. ¶ [1]). 25.

The Debtors are permitted to use the proceeds of the Postpetition Facility

and cash collateral for working capital, general corporate purposes, and the administration of these chapter 11 cases, all in accordance with the Budget. The Budget is based on the Debtors’ 13-week cash-flow forecasts and may be updated from time to time. Under the Postpetition Loan Agreement, the Debtors are permitted to make disbursements on a rolling four-week basis, in the aggregate up to 7.5% greater than the Debtors’ projected total disbursements for that period. This arrangement provides significant financial flexibility to the Debtors. Additionally, the Postpetition Agent will have cash dominion over the Debtors’ bank accounts, consistent with

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the cash dominion status Angelica was subject to prepetition under the Prepetition ABL Facility. Under the terms of the cash dominion process, the Debtors will submit to the Postpetition Agent daily funding requests to operate their businesses throughout the Sale Process. 26.

To give the Debtors the best possible opportunity to maximize the value of

the business as a going concern, and to preserve the employment of as many the Debtors’ employees as possible, the Debtors believe that the timely execution of the Sale Process is crucial. Executing a prompt going concern sale will restore the confidence of the Debtors’ vendors and customers, allowing them to compete more effectively in their competitive industry. If the Sale Process is not executed in a timely fashion, Angelica risks losing existing customers and significant revenue associated with new business in the pipeline, ultimately destroying value that a potential going concern buyer otherwise would pay for. 27.

These considerations are reflected in the milestones in the Postpetition

Loan Agreement (the “Milestones”). The Milestones are as follows:3 

By April 10, 2017, the Debtors shall file a sale motion (the “Sale Motion”) with the Court together with a committed asset purchase agreement, in form and substance acceptable to the Postpetition Agent and Postpetition Lenders, to purchase substantially all of the assets of the Debtors (the “Stalking Horse Bid”).



By April 28, 2017, the Court shall have entered an order approving the Stalking Horse Bid.



By June 12, 2017, the auction, if necessary, of the assets covered by the Stalking Horse Bid shall be held.



By June 17, 2017, the Court shall have entered an order approving the Sale Motion.

Any summary of the Milestones is qualified in its entirety by reference to the provisions of the Postpetition Loan Agreement and Interim Order. To the extent the Milestones and the Interim Order or Postpetition Loan Agreement are inconsistent, the Interim Order or Postpetition Loan Agreement, as applicable, shall control.

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o The contingencies to the Stalking Horse Bid set forth in section 10.1(e) and (f) of the Stalking Horse APA shall each have been waived by the Stalking Horse Bidder or otherwise satisfied on or before the date of the final hearing on the Sale Motion.  28.

By June 27, 2017, the closing and funding of the sale transaction shall occur. The other material terms and conditions of the Postpetition Facility are

summarized in the table at the beginning of this Motion. The terms and conditions of the Debtors’ use of Cash Collateral and the Postpetition Facility, including the Milestones and the Budget, are commercially reasonable. Efforts to Obtain Postpetition Financing 29.

As explained in the Jordan Declaration, the Debtors determined to enter

into the Postposition Facility only after a competitive, robust marketing process. The Debtors surveyed various sources of postpetition financing, including potential financing from the Prepetition Lenders and unrelated third parties. In exploring those options, the Debtors were cognizant of the challenges presented by the fact that substantially all of the Debtors’ assets are encumbered by the Prepetition Liens. It became clear to the Debtors that, in order to obtain the necessary liquidity to administer their chapter 11 cases and execute the sale process, the Debtors either would have to (a) find a postpetition lender willing to extend credit that would be junior to the Prepetition Liens or unsecured or (b) obtain postpetition financing secured by liens that would prime the Prepetition Liens. (See Jordan Decl. ¶ 12). 30.

In January 2017, the Debtors spoke with their existing lenders about

providing postpetition financing in the context of the ongoing sales process. In mid-February, the Debtors began contacting potential third-party DIP lenders, consisting of banks and financing firms. Houlihan Lokey spoke with six third-party lenders, all of which executed an NDA to review the opportunity. The Debtors’ solicitation did not yield any offers as the potential third21 WEIL:\96030439\10\15465.0003

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party providers were not interested in a priming fight with the Prepetition Senior Lenders nor were they interested in providing unsecured credit or junior secured credit. Further, the Debtors concluded that raising postpetition financing on a nonconsensual priming basis would be much more expensive and disruptive to their businesses than what could reasonably be achieved by entering into the Postpetition Facility with the Prepetition Senior Lenders. Accordingly, the Debtors focused their postpetition financing efforts on securing financing from the Prepetition Senior Lenders. (See Jordan Decl. ¶ 13). 31.

For several weeks, the Debtors and their advisors engaged in rigorous

negotiations with the Prepetition Senior Lenders and their advisors to obtain the best financing terms available. In addition, the Debtors’ advisors continued to solicit additional financing from potential purchasers, but as of the Commencement Date, have not been successful in obtaining a commitment. The negotiations were conducted at arm’s length and properly may be characterized as “hard fought negotiations” by all interested parties. Mere days before the Commencement Date, key terms of the Postpetition Loan Agreement such as the maturity date, the sale-related milestones, and the adequate protection provisions were still being negotiated. With third-parties unwilling to provide unsecured or junior secured credit and unwilling to enter into a priming fight with existing senior secured lenders who would not consent to priming, the Postpetition Facility is the only realistic financing available to the Debtors under the circumstances and is absolutely critical to the Debtors’ ability to administer their chapter 11 cases. (See Jordan Decl. ¶ 14). Proposed Roll-Up 32.

Pursuant to Local Rule 4001-2(a)(7), the Debtors are required to disclose

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proceeds of the Postpetition Collateral shall be used to pay down the Prepetition Senior Obligations. The Roll-Up is designed as a “creeping roll-up” whereby the Debtors’ postpetition receipts are applied to the Prepetition Senior Obligations, and corresponding amounts are advanced to the Company under the Postpetition Facility. (See Jordan Decl. ¶ 21). 33.

Agreeing to the “creeping” Roll-Up is supported by the sound business

judgment of the Debtors. Importantly, and as further described in the Jordan Declaration, based on the consideration that would be provided under the Stalking Horse Bid, the Prepetition Senior Obligations are oversecured. The Roll-Up simply advances the payment of debt that would be satisfied by the Debtors’ estates regardless of the outcome of the sale process. The practical result of the Roll-Up is a reduction in the amount of default interest that otherwise would be paid by the estates, thereby increasing the available assets to satisfy the claims of other creditors. Further, no parties in interest will be prejudiced by the Roll-Up, because the Prepetition Liens will be subject to review by the official committee of unsecured creditors (the “Creditors’ Committee”) when appointed. (See Jordan Decl. ¶ 22). 34.

Lastly, the Roll-Up, among other things, was a requirement in order to

obtain the Prepetition Senior Lenders’ consent to the use of Cash Collateral and the priming of their prepetition liens. For these reasons, and as further discussed below, the Debtors assert that the Roll-Up is justified in these cases and in the best interests of their creditors and estates. (See Jordan Decl. ¶ 23). Court Should Approve Postpetition Facility A.

Postpetition Facility Satisfies Requirements of Bankruptcy Code 35.

Approval of the Postpetition Loan Agreement will provide the Debtors

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things, in all cases subject to the Budget. Unless these expenditures are made, the Debtors’ efforts to consummate the Sale Process will falter. The credit provided under the Postpetition Facility will enable the Debtors to operate their business in the ordinary course while they pursue the Sale Process in an orderly manner, which will preserve and enhance value for the benefit of all parties in interest. Approval of the Postpetition Facility also will provide confidence to the Debtors’ trade vendors that will enable and encourage them to continue their relationships with the Debtors, and will be viewed favorably by the Debtors’ employees and customers. 36.

Section 364(c) of the Bankruptcy Code provides, among other things, that

if a debtor is unable to obtain unsecured credit allowable as an administrative expense under section 503(b)(1) of the Bankruptcy Code, the court may authorize the debtor to obtain credit or incur debt (a) with priority over any and all administrative expenses as specified in section 503(b) or 507(b) of the Bankruptcy Code, (b) secured by a lien on property of the estate that is not otherwise subject to a lien, or (c) secured by a junior lien on property of the estate that is subject to a lien. 11 U.S.C. § 364(c). Section 364(d) of the Bankruptcy Code allows a debtor to obtain credit secured by a senior or equal lien on property of the estate that is subject to a lien, provided that (a) the debtor is unable to obtain such credit otherwise, and (b) there is adequate protection of the interest of the holder of the lien on the property of the estate on which such senior or equal lien is proposed to be granted. 11 U.S.C. § 364(d). 37.

Despite their efforts, the Debtors were unable to procure sufficient

financing (a) in the form of unsecured credit allowable under section 503(b)(1), (b) as an administrative expense under section 364(a) or (b), (c) in exchange for the grant of a superpriority administrative expense claim pursuant to section 364(c)(1), or (d) without granting priming liens pursuant to section 364(d). They were also unable to obtain postpetition financing

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or other financial accommodations from any alternative prospective lender or group of lenders on more favorable terms and conditions than those for which approval is sought herein. Given that substantially all of the Debtors’ assets are encumbered, no party was willing to consider providing postpetition financing on competitive terms other than the Postpetition Lenders. and the Debtors determined that they could not obtain postpetition financing without priming the Prepetition Senior Lenders. (See Jordan Decl. ¶ 12). 38.

Having determined that financing was available only under sections

364(c) and (d) of the Bankruptcy Code and that the Prepetition Lenders would not agree to be primed by any third party, the Debtors, in their business judgment, negotiated the Postpetition Facility with the Postpetition Lenders extensively, at arm’s length and in good faith. 39.

Provided that a debtor’s business judgment does not run afoul of the

provisions of, and policies underlying, the Bankruptcy Code, courts grant a debtor considerable deference in acting in accordance therewith. See, e.g., Bray v. Shenandoah Fed. Sav. & Loan Ass’n (In re Snowshoe Co.), 789 F.2d 1085, 1089-90 (4th Cir. 1986); In re Ames Dep’t Stores, Inc., 115 B.R. 34, 40 (Bankr. S.D.N.Y. 1990) (“[C]ases consistently reflect that the court’s discretion under section 364 is to be utilized on grounds that permit reasonable business judgment to be exercised so long as the financing agreement does not contain terms that leverage the bankruptcy process and powers or its purpose is not so much to benefit the estate as it is to benefit a party-in-interest.”); see also In re Simasko Prod. Co., 47 B.R. 444, 449 (D. Colo. 1985); Funding Sys. Asset Mgmt. Corp. v. Key Capital Corp. (In re Funding Sys. Asset Mgmt. Corp.), 72 B.R. 87, 88 (Bankr. W.D. Pa. 1987); In re Curlew Valley Assocs., 14 B.R. 506, 51314 (Bankr. D. Utah 1981).

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Section 364(d) does not require that a debtor seek alternative financing

from every possible lender; rather, the debtor simply must demonstrate sufficient efforts to obtain financing without the need to grant a senior lien. In re Snowshoe Co., 789 F.2d at 1088 (demonstrating that credit was unavailable absent senior lien by establishment of unsuccessful contact with other financial institutions in geographic area); In re 495 Central Park Ave. Corp., 136 B.R. 626, 631 (Bankr. S.D.N.Y. 1992) (debtor testified to numerous failed attempts to procure financing from various sources, explaining that “most banks lend money only in return for a senior secured position”); In re Aqua Assocs., 123 B.R. 192, 197 (Bankr. E.D. Pa. 1991) (debtor’s “evidence of a credit quest” adequately established that some degree of priming loan was necessary for the debtor to obtain funding). 41.

The Debtors submit that the circumstances of these cases require the

Debtors to obtain financing under sections 364(c) and (d) of the Bankruptcy Code, and accordingly, entry into the Postpetition Loan Agreement reflects the exercise of their sound business judgment. Further, consummation of the Postpetition Loan Agreement is in the best interest of the Debtors’ estates, their creditors, and all parties in interest in these chapter 11 cases and is consistent with the Debtors’ exercise of their fiduciary duty. Accordingly, the Postpetition Lenders and all obligations incurred in connection with the Postpetition Loan Facility should be afforded the benefits of section 364(e) of the Bankruptcy Code. B.

Interests of Prepetition Secured Parties Are Adequately Protected 42.

Under sections 363(e) of the Bankruptcy Code, a party with a security

interest in a debtor’s assets is entitled to adequate protection if the debtor uses those assets to secure postpetition financing. Under section 364(d)(1)(B) of the Bankruptcy Code, a debtor may obtain postpetition financing “secured by a senior or equal lien on property of the estate that is

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subject to a lien only” if the debtor provides adequate protection to parties the liens of which are primed. Adequate protection may be provided in various forms, including by making cash payments of interest and fees, granting superpriority claims, and granting replacement liens. What constitutes adequate protection is evaluated on a case-by-case basis. See, e.g., In re Mosello, 195 B.R. 277, 289 (Bankr. S.D.N.Y. 1996) (“[T]he determination of adequate protection is a fact specific inquiry . . . left to the vagaries of each case[.]”); In re Realty Sw. Assocs., 140 B.R. 360 (Bankr. S.D.N.Y. 1992); In re Beker Indus. Corp., 58 B.R. 725, 736 (Bankr. S.D.N.Y. 1986) (The application of adequate protection “is left to the vagaries of each case, but its focus is protection of the secured creditor from diminution in the value of its collateral during the reorganization process[.]”) (citation omitted). The purpose of adequate protection is to guard against diminution in the value of a secured creditor’s collateral resulting from the imposition of the automatic stay or the debtor’s postpetition use of such collateral. See 495 Cent. Park, 136 B.R. at 631 (“The goal of adequate protection is to safeguard the secured creditor from diminution in the value of its interest during the chapter 11 reorganization.”); In re Beker Indus. Corp., 58 B.R. 725, 736 (Bankr. S.D.N.Y. 1986); In re Hubbard Power & Light, 202 B.R. 680, 685 (Bankr. E.D.N.Y. 1996). 43.

Here, the Debtors propose to grant the adequate protection provisions set

forth in the summary chart in paragraph 7 above to the extent of any diminution in value of the Prepetition Senior Agent’s and the Prepetition Junior Agent’s interest in the Prepetition Senior Collateral from and after the Commencement Date (collectively, the “Adequate Protection”). The Debtors propose that the Adequate Protection package negotiated here, for the benefit of both the Prepetition Senior Lenders and the Prepetition Junior Lenders is appropriate in the circumstances.

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Entry into Postpetition Facility Is Reasonable Exercise of Debtors’ Business Judgment 44.

As a general matter, courts grant a debtor considerable deference when the

debtor exercises reasonable business judgment in obtaining postpetition financing, so long as the proposed financing does not violate the provisions or underlying policies of the Bankruptcy Code. See, e.g., In re Barbara K. Enters., Inc., Ch. 11 Case No. 08-11474, 2008 WL 2439649, at *14 (Bankr. S.D.N.Y. June 16, 2008) (reasoning that courts defer to a debtor’s business judgment “so long as a request for financing does not ‘leverage the bankruptcy process’ and unfairly cede control of the reorganization to one party in interest”); Ames Dep’t Stores, 115 B.R. at 34 (“[C]ases consistently reflect that the court’s discretion under section 364 [of the Bankruptcy Code] is to be utilized on grounds that permit [a debtor’s] reasonable business judgment to be exercised so long as the financing agreement does not contain terms that leverage the bankruptcy process and powers or its purpose is not so much to benefit the estate as it is to benefit a party-in-interest.”); In re Farmland Indus., Inc., 294 B.R. 855, 881 (Bankr. W.D. Mo. 2003) (noting that approval of postpetition financing requires, among other things, an exercise of “sound and reasonable business judgment”). 45.

In determining whether the Debtors have exercised sound business

judgment in entering into the Postpetition Facility, the Court should consider the economic terms of the Postpetition Facility in light of current market conditions. See Hr’g Tr. at 734–35, In re Lyondell Chem. Co., Ch. 11 Case No. 09-10023 (Bankr. S.D.N.Y. March 5, 2009) (recognizing “the terms that are now available for DIP Financing in the current economic environment aren’t as desirable” as in the past). Moreover, the Court may appropriately take into consideration noneconomic benefits to the Debtors offered by a proposed postpetition facility. For example, in

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In re ION Media Networks, Inc., the Bankruptcy Court for the Southern District of New York held: Although all parties, including the Debtors and the Committee, are naturally motivated to obtain financing on the best possible terms, a business decision to obtain credit from a particular lender is almost never based purely on economic terms. Relevant features of the financing must be evaluated, including noneconomic elements such as the timing and certainty of closing, the impact on creditor constituencies and the likelihood of a successful reorganization. This is particularly true in a bankruptcy setting where cooperation and established allegiances with creditor groups can be a vital part of building support for a restructuring that ultimately may lead to a confirmable reorganization plan. That which helps foster consensus may be preferable to a notionally better transaction that carries the risk of promoting unwanted conflict. Ch. 11 Case No. 09-13125, 2009 WL 2902568, at *4 (Bankr. S.D.N.Y. July 6, 2009). 46.

Here, in light of (a) the Debtors’ capital structure; (b) the fact that

substantially all of the Debtors’ assets are subject to prepetition liens; (c) the negotiations that the Debtors undertook with the Postpetition Agent (on behalf of the Postpetition Lenders); (d) the absence of better financing proposals; (e) the ability of the Postpetition Facility to preserve the status quo during the period between the entry of the Interim Order and the Final Order (the “Interim Period”) and facilitate the Sale Process; and (f) the Debtors’ need for certainty during the Interim Period, the Postpetition Facility was plainly the Debtors’ best option for postpetition financing. 47.

Based on the foregoing, the Postpetition Facility is in the Debtors’ best

interests, constitutes a reasonable exercise of their business judgment, and should be approved. D.

Carve-Out Is Appropriate 48.

In providing the Postpetition Facility, the Postpetition Agent and

Postpetition Lenders have agreed to subordinate the adequate protection liens and claims to the following carve-out:

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(a)

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The liens and claims granted to any of the Postpetition Agent, Postpetition Lenders, Prepetition Agents, or Prepetition Secured Lenders in this Order, the Postpetition Loan Documents, the Prepetition Senior Loan Documents and/or any Prepetition Junior Loan Documents shall be subject to the payment, without duplication, of the following fees and claims (collectively, the “Carve-Out”), but only to the extent that there are not sufficient, unencumbered funds in the Debtors’ estates to pay such amounts at the time payment is required to be made: (i)

all fees required to be paid to the Clerk of the Court and to the Office of the United States Trustee under section 1930(a) of title 28 of the United States Code plus interest at the statutory rate (without regard to the notice set forth in (iv) below);

(ii)

all reasonable fees and expenses up to $50,000 incurred by a trustee under section 726(b) of the Bankruptcy Code (without regard to the notice set forth in (iv) below);

(iii)

to the extent allowed at any time, whether by interim order, procedural order, or otherwise, all unpaid fees and expenses (the “Allowed Professional Fees”) incurred by persons or firms retained by the Debtors pursuant to section 327, 328, or 363 of the Bankruptcy Code (the “Debtor Professionals”) and professionals of any statutory committees appointed in the Chapter 11 Cases whose retention is approved by the Court during the Chapter 11 Cases pursuant to section 328 or 1103 of the Bankruptcy Code (the “Committee Professionals” and, together with the Debtor Professionals, the “Retained Professionals”) at any time before or on the first business day following delivery by the Postpetition Agent of a Carve Out Trigger Notice (as defined below), whether allowed by the Court prior to or after delivery of a Carve Out Trigger Notice; and

(iv)

Allowed Professional Fees of Retained Professionals in an aggregate amount not to exceed $250,000 incurred after the first business day following delivery by the Postpetition Agent of the Carve Out Trigger Notice, to the extent allowed at any time, whether by interim order, procedural order, or otherwise (the amounts set forth in this clause (iv) being the “Post-Carve Out Trigger Notice Cap”). For purposes of the foregoing, “Carve Out Trigger Notice” shall mean a written notice delivered by email (or other electronic means) by the Postpetition Agent to the Debtors, their counsel, the U.S. Trustee, and counsel to the Creditors’ Committee, which notice may be delivered only on or after (i) the occurrence and continuation of an Event of Default under the Postpetition Loan Agreement or the Commitment Termination Date and (ii) the termination of the Postpetition Agent’s or Postpetition Lenders’ obligations to make loans or 30

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provide other extensions of credit under the Postpetition Loan Agreement. 49.

The Carve-Out is similar to other terms created for professional fees that

have been found to be reasonable and necessary to ensure that a debtor’s estate and any statutory committee can retain assistance from counsel. See In re Westinghouse Electric Co. LLC, Case No. 17-10751 (MEW) (Bankr. S.D.N.Y. March 31, 2017) [Docket No. 86] (approving postpetition financing with carve-out for professional fees on an interim basis); In re Breitburn Energy Partners LP, Case No. 16-11390 (SMB) (Bankr. S.D.N.Y. May 23, 2016 and Aug. 19, 2016) [Docket Nos. 73 and 431] (approving postpetition financing with carve-out for professional fees on an interim and final basis); In re Aéropostale, Inc., Case No. 16-11275 (SHL) (Bankr. S.D.N.Y. May 6, 2016 and June 13, 2016) [Docket Nos. 99 and 298] (same); In re Fairway Grp. Holdings Corp., Case No. 16-11241 (MEW) (Bankr. S.D.N.Y. May 5, 2016 and May 31, 2016) [Docket Nos. 55 and 117] (same); In re The Great Atl. & Pac. Tea Co., Inc., Case No. 15-23007 (RDD) (Bankr. S.D.N.Y. July 21, 2015 and Aug. 12, 2015) [Docket Nos. 88 and 531] (same). 50.

Without the Carve-Out, the Debtors’ estates and other parties in interest

may be deprived of rights and powers because all of the Debtors’ assets would be subject to prior security interests. See id. at 38 (observing that courts insist on carve-outs for professionals representing parties in interest because “[a]bsent such protection, the collective rights and expectations of all parties-in-interest are sorely prejudiced”).

The Carve-Out also protects

against the risk of administrative insolvency by ensuring that assets remain available for the payment of statutory and professional fees. Accordingly, the Court should approve the CarveOut.

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Postpetition Lenders Should Be Deemed Good Faith Lenders Under Section 364(e) of Bankruptcy Code 51.

Section 364(e) of the Bankruptcy Code protects a good faith lender’s right

to enforce the terms of postpetition loans extended to a debtor, as well as its right to enforce any postpetition lien securing those loans, even if the authority of the debtor to obtain such loans or grant such liens is later reversed or modified on appeal. Specifically, section 364(e) provides that: [t]he reversal or modification on appeal of an authorization under this section [364 of the Bankruptcy Code] to obtain credit or incur debt, or of a grant under this section of a priority or a lien, does not affect the validity of any debt so incurred, or any priority or lien so granted, to an entity that extended such credit in good faith, whether or not such entity knew of the pendency of the appeal, unless such authorization and the incurring of such debt, or the granting of such priority or lien, were stayed pending appeal. 11 U.S.C. § 364(e). 52.

As detailed herein and in the Jordan Declaration, the Postpetition Facility

is the result of the Debtors’ reasonable and informed determination that the Postpetition Lenders offered the most favorable terms pursuant to which the Debtors could obtain necessary postpetition financing. (See Jordan Decl. ¶ 24–27). All negotiations of the Postpetition Facility and with all potential lenders were conducted in good faith and at arms’ length. The terms and conditions of the Postpetition Facility are fair and reasonable, and the proceeds of the Postpetition Facility will be used only for purposes that are permissible under the provisions and underlying policies of the Bankruptcy Code. Accordingly, the Debtors believe the Postpetition Lenders constitute good faith lenders within the meaning of section 364(e) of the Bankruptcy Code and are entitled to the protections thereof.

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Automatic Stay Should Be Modified to Limited Extent 53.

The Postpetition Facility requires the modification of the automatic stay

(to the extent applicable): (a) to permit the Debtors to grant the Postpetition Liens to the Postpetition Agent and Postpetition Lenders and the Adequate Protection Liens and Adequate Protection Claims to the Prepetition Secured Parties, and to perform such acts as may be required to assure the perfection and priority of each; (b) to permit the Postpetition Lenders to exercise certain remedies under the Postpetition Loan Agreement as provided in and on the terms of the DIP Orders; and (c) to implement the terms of the proposed Interim Order and the Final Order. 54.

Stay modifications of this kind are standard features of postpetition

financing facilities and, in the reasonable exercise of the Debtors’ business judgment, are appropriate under the present circumstances. See, e.g., In re The Great Atl. & Pac. Tea Co., Inc., Ch. 11 Case No. 15-23007 (RDD) (Bankr. S.D.N.Y. July 21, 2015) (ECF No. 88); In re Chassix Holdings, Inc., Ch. 11 Case No. 15-10578 (MW) (Bankr. S.D.N.Y. Mar. 13, 2015) (ECF No. 67); In re The Reader’s Digest Assoc., Ch. 11 Case No. 09-23529 (RDD) (Bankr. S.D.N.Y. Aug. 26, 2009) (ECF No. 26); In re Lear Corp., Ch. 11 Case No. 09-14326 (ALG) (Bankr. S.D.N.Y. July 7, 2009) (ECF No. 59). G.

Court Should Authorize Use of Cash Collateral 55.

The Debtors require the use of cash collateral in addition to the proceeds

of the Postpetition Facility to maintain and fund their operations. Under section 363(c)(2) of the Bankruptcy Code, a debtor may use cash collateral if “(A) each entity that has an interest in such cash collateral consents; or (B) the court, after notice and a hearing, authorizes such use, sale, or lease in accordance with the provisions of this section.” Section 363(e) provides that “on request of an entity that has an interest in property . . . proposed to be used, sold or leased, by the

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[debtor], the court, with or without a hearing, shall prohibit or condition such use, sale, or lease as is necessary to provide adequate protection of such interest.” 56.

The Debtors have satisfied the requirements of sections 363(c)(2) and (e)

and should be authorized to use Cash Collateral. The Postpetition Agent and Postpetition Lenders have consented to the Debtors’ use of Cash Collateral, subject to the terms of the DIP Orders. All of these parties are adequately protected by the Adequate Protection. Accordingly, the Court should authorize the Debtors to use Cash Collateral. H.

Interim Relief Is Warranted 57.

Under Bankruptcy Rules 4001(b) and (c), the Court may grant interim

relief under sections 363(c) and 364 of the Bankruptcy Code where, as here, such relief is “necessary to avoid immediate and irreparable harm to the estate pending a final hearing.” In evaluating requests for interim relief, courts in this jurisdiction generally apply the same business judgment standard applicable to other business decisions. See In re Ames Dep’t Stores, Inc., 115 B.R. 36, 40 (Bankr. S.D.N.Y. 1990). Courts routinely authorize debtors to obtain postpetition loans and use cash collateral on an interim basis to prevent immediate and irreparable harm to their estates. See, e.g., In re The Great Atl. & Pac. Tea Co., Inc., Ch. 11 Case No. 15-23007 (RDD) (Bankr. S.D.N.Y. July 21, 2015) (ECF No. 88) (approving postpetition financing on an interim basis); In re Chassix Holdings, Inc., Ch. 11 Case No. 15-10578 (MW) (Bankr. S.D.N.Y. Mar. 13, 2015) (ECF No. 67) (same); In re Eastman Kodak Co., Case No. 12-10202 (MEW) (Bankr. S.D.N.Y. Jan. 20, 2012) (ECF No. 54) (same); In re The Great Atl. & Pac. Tea Co., Ch. 11 Case No. 10-24549 (RDD) (Bankr. S.D.N.Y. Dec. 13, 2010) (ECF No. 43) (same); In re The Reader’s Digest Assoc., Case No. 09-23529 (RDD) (Bankr. S.D.N.Y. Aug. 26, 2009) (ECF No. 26) (same); In re Tronox Inc., Ch. 11 Case No. 09-10156 (MEW) (Bankr. S.D.N.Y. Jan. 13,

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2009) (ECF No. 46) (same); In re Lyondell Chem. Co., Ch. 11 Case No. 09-10023 (REG) (Bankr. S.D.N.Y. Jan. 8, 2009) (ECF No. 79) (same); In re Frontier Airlines Holdings, Inc., Ch. 11 Case No. 08-11298 (RDD) (Bankr. S.D.N.Y. Aug. 5, 2008) (ECF No. 433) (same). 58.

Here, the Debtors and their estates will suffer immediate and irreparable

harm if the relief requested herein is not granted on an interim basis. As discussed above, the Debtors have insufficient cash to fund their operations and conduct the Sale Process without access to the Postpetition Facility and Cash Collateral during the Interim Period. Accordingly, the Court should grant the relief requested herein on an interim basis. I.

Court Should Schedule a Final Hearing 59.

Pursuant to Bankruptcy Rules 4001(b)(2) and 4001(c)(2), the Debtors

request that the Court schedule a hearing no later than 30 days after entry of the Proposed Interim Order to consider entry of the Final Order. The Debtors request that they be authorized to serve a copy of the signed Interim Order, which fixes the time and date for the filing of objections, if any, by first class mail upon the notice parties listed below and that such notice of the Final Hearing be deemed sufficient under Bankruptcy Rule 4001(c)(2). Bankruptcy Rule 6003(b) Is Satisfied 60.

Bankruptcy Rule 6003(b) provides that, to the extent relief is necessary to

avoid immediate and irreparable harm, a bankruptcy court may approve a motion to â&#x20AC;&#x153;pay all or part of a claim that arose before the filing of the petitionâ&#x20AC;? prior to 21 days after the commencement date. Fed. R. Bankr. P. 6003(b). Here, to the extent the Postpetition Facility or the DIP Orders require or authorize the payment of prepetition obligations, the benefits of obtaining the Postpetition Facility justify the payment of such obligations. Accordingly, the

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Debtors submit that the relief requested herein is necessary to avoid immediate and irreparable harm, and, therefore, Bankruptcy Rule 6003 is satisfied. Waiver of Bankruptcy Rules 6004(a) and (h) 61.

The Debtors believe that, under the circumstances of these chapter 11

cases, notice of the Motion, as set forth below, is adequate under Bankruptcy Rule 6004(a). Notwithstanding any applicability of the 14-day stay of an order authorizing the use, sale, or lease of property under Bankruptcy Rule 6004(h), the Debtors respectfully request that the Motion be approved and the relief requested be immediately effective and enforceable. Notice 62.

Notice of this Motion has been provided to (i) the Office of the United

States Trustee for Region 2; (ii) the holders of the four largest secured claims against the Debtors (on a consolidated basis); (iii) the holders of the 20 largest unsecured claims against the Debtors (on a consolidated basis); (iv) counsel for Wells Fargo Capital Finance, LLC, as agent and lender under that certain Loan and Security Agreement, dated as of July 15, 2011 (as modified, supplemented, or amended from time to time, the “ABL Credit Agreement”); (v) counsel for Cortland Capital Market Services LLC, as agent under that certain Amended and Restated Loan and Security Agreement, dated July 12, 2016 (as thereafter amended or modified from time to time, the “Term Loan Credit Agreement”); [(vi) counsel for KKR Credit Advisors (US) LLC, as lenders under the Term Loan Credit Agreement; (vii) counsel for the Postpetition Lenders; (viii) the Unions (as defined in the Debtors’ Motion of Debtors Pursuant to 11 U.S.C. §§ 105(a), 363 and 507(a) for Interim and Final Authority to (I) Pay Certain Prepetition Wages and Reimbursable Employee Expenses, (II) Pay and Honor Employee Medical and Other Benefits, and (III) Continue Employee Benefits Programs, and for Related Relief, filed contemporaneously herewith) and their counsel, if any; (ix) the Securities and Exchange Commission; (x) the 36 WEIL:\96030439\10\15465.0003

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Internal Revenue Service; and (xi) the United States Attorney’s Office for the Southern District of New York (collectively, the “Notice Parties”). The Debtors submit that, in view of the facts and circumstances, such notice is sufficient and no other or further notice need be provided. 63.

No previous request for the relief sought herein has been made by the

Debtors to this or any other court. WHEREFORE the Debtors respectfully request entry of an interim order granting the relief requested herein and such other and further relief as is just. Dated: April 3, 2017 New York, New York /s/ Matthew S. Barr WEIL, GOTSHAL & MANGES LLP 767 Fifth Avenue New York, New York 10153 Telephone: (212) 310-8000 Facsimile: (212) 310-8007 Matthew S. Barr Jill Frizzley Kevin Bostel Proposed Counsel for Debtors and Debtors in Possession

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Exhibit A Postpetition Loan Agreement

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CLOTHESLINE HOLDINGS, INC., a Delaware corporation ANGELICA CORPORATION, a Missouri corporation ANGELICA TEXTILE SERVICES, INC., a California corporation, ANGELICA TEXTILE SERVICES, INC., a New York corporation, ROYAL INSTITUTIONAL SERVICES, INC., a Massachusetts corporation as Borrowers SENIOR SECURED, SUPER-PRIORITY DEBTOR-IN-POSSESSION LOAN AND SECURITY AGREEMENT Dated: April 3, 2017 $65,000,000.00 THE FINANCIAL INSTITUTIONS PARTY HERETO FROM TIME TO TIME, as Lenders and WELLS FARGO CAPITAL FINANCE, LLC, as Administrative Agent, Collateral Agent, Joint-Lead Arranger and Sole Bookrunner and REGIONS BANK as Co-Collateral Agent and REGIONS BUSINESS CAPITAL, a division of Regions Bank, as Joint-Lead Arranger

ATL 21975805v8

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TABLE OF CONTENTS Page SECTION 1. 1.1. 1.2. 1.3. 1.4. 1.5. 1.6. 1.7. 1.8. 1.9.

General Definitions .....................................................................................................2 Accounting Terms .....................................................................................................38 Other Terms ..............................................................................................................38 Certain Matters of Construction................................................................................38 Release ......................................................................................................................39 Super Priority Nature of Obligations and Agent’s and Lenders’ Liens ....................40 Payment of Obligations.............................................................................................40 No Discharge; Survival of Claims ............................................................................41 Waiver of any Priming Rights ..................................................................................41

SECTION 2. 2.1. 2.2. 2.3. 2.4.

ii ATL 21975805v8

LOAN ADMINISTRATION ..............................................................................56

Manner of Borrowing and Funding Revolver Loans ................................................56 Defaulting Lender .....................................................................................................60 [Reserved] .................................................................................................................61 Borrower Agent ........................................................................................................61 Loans to Constitute One General Obligation ............................................................61

SECTION 5. 5.1. 5.2.

INTEREST, FEES AND CHARGES .................................................................49

Interest.......................................................................................................................49 Fees ...........................................................................................................................50 Computation of Interest and Fees .............................................................................51 Reimbursement Obligations......................................................................................52 Bank Charges ............................................................................................................53 [Reserved] .................................................................................................................53 Increased Costs .........................................................................................................53 Capital Adequacy ......................................................................................................54 Mitigation..................................................................................................................55 [Reserved.] ................................................................................................................55 Maximum Interest .....................................................................................................55

SECTION 4. 4.1. 4.2. 4.3. 4.4. 4.5.

CREDIT FACILITIES ........................................................................................41

Commitments ............................................................................................................41 Revolver Commitments ............................................................................................41 LC Facility ................................................................................................................43 Bank Products ...........................................................................................................49

SECTION 3. 3.1. 3.2. 3.3. 3.4. 3.5. 3.6. 3.7. 3.8. 3.9. 3.10. 3.11.

DEFINITIONS; RULES OF CONSTRUCTION .................................................2

PAYMENTS .......................................................................................................62

General Payment Provisions .....................................................................................62 Repayment of Revolver Loans..................................................................................62

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5.3. 5.4. 5.5. 5.6. 5.7. 5.8. 5.9. 5.10. 5.11.

COLLATERAL ..................................................................................................71

COLLATERAL ADMINISTRATION...............................................................73

General Provisions ....................................................................................................73 Administration of Accounts ......................................................................................74 Administration of Inventory .....................................................................................77 Administration of Equipment ...................................................................................78 Borrowing Base Certificates .....................................................................................78

SECTION 9. 9.1. 9.2.

TERM AND TERMINATION OF COMMITMENTS ......................................69

Grant of Security Interest ..........................................................................................71 Real Estate Collateral................................................................................................71 Other Collateral .........................................................................................................71 No Assumption of Liability ......................................................................................72 Lien Perfection; Further Assurances .........................................................................72 [Reserved]. ................................................................................................................73

SECTION 8. 8.1. 8.2. 8.3. 8.4. 8.5.

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Term of Commitments ..............................................................................................69 Termination ...............................................................................................................70

SECTION 7. 7.1. 7.2. 7.3. 7.4. 7.5. 7.6.

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[Reserved] .................................................................................................................63 Payment of Other Obligations ..................................................................................63 Payments Set Aside...................................................................................................63 Allocation of Payments .............................................................................................63 Application of Payments and Collateral Proceeds ....................................................64 Loan Accounts; the Register; Account Stated ..........................................................65 Taxes .........................................................................................................................66 Withholding Tax Exemption.....................................................................................66 Nature and Extent of Each Borrower’s Liability ......................................................67

SECTION 6. 6.1. 6.2.

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REPRESENTATIONS AND WARRANTIES...................................................79

General Representations and Warranties ..................................................................79 Reaffirmation and Survival of Representations and Warranties...............................87

SECTION 10. COVENANTS AND CONTINUING AGREEMENTS.....................................87 10.1. 10.2. 10.3. 10.4.

Affirmative Covenants ..............................................................................................87 Negative Covenants ..................................................................................................92 Financial Covenant ...................................................................................................98 [Reserved] .................................................................................................................98

SECTION 11. CONDITIONS PRECEDENT ............................................................................99

iii

11.1. 11.2. 11.3. 11.4.

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Conditions Precedent to Initial Credit Extensions ....................................................99 Conditions Precedent to All Credit Extensions ......................................................100 Inapplicability of Conditions ..................................................................................101 Limited Waiver of Conditions Precedent ...............................................................101

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Conditions Subsequent............................................................................................101

SECTION 12. EVENTS OF DEFAULT; RIGHTS AND REMEDIES ON DEFAULT .........102 12.1. 12.2. 12.3. 12.4. 12.5.

Events of Default ....................................................................................................102 Remedies .................................................................................................................106 Other Remedies .......................................................................................................107 Setoff .......................................................................................................................109 Remedies Cumulative; No Waiver .........................................................................109

SECTION 13. AGENT .............................................................................................................110 13.1. 13.2. 13.3. 13.4. 13.5. 13.6. 13.7. 13.8. 13.9. 13.10. 13.11. 13.12. 13.13. 13.14. 13.15. 13.16. 13.17. 13.18. 13.19.

Appointment, Authority and Duties of Agent.........................................................110 Agreements Regarding Collateral and Examination Reports .................................112 Reliance By Agent ..................................................................................................113 Action Upon Default ...............................................................................................113 Ratable Sharing .......................................................................................................114 Indemnification of Agent Indemnitees ...................................................................115 Limitation on Responsibilities of Agent .................................................................116 Successor Agent and Co-Agents .............................................................................116 Consents, Amendments and Waivers .....................................................................117 Due Diligence and Non-Reliance ...........................................................................119 Representations and Warranties of Lenders ...........................................................119 The Required Lenders .............................................................................................119 Several Obligations .................................................................................................120 Agent in its Individual Capacity .............................................................................120 No Third Party Beneficiaries ..................................................................................120 Notice of Transfer ...................................................................................................120 Replacement of Certain Lenders .............................................................................120 Remittance of Payments and Collections ...............................................................121 [Reserved] ...............................................................................................................122

SECTION 14. BENEFIT OF AGREEMENT; ASSIGNMENTS AND PARTICIPATIONS ..........................................................................................122 14.1. 14.2. 14.3.

Successors and Assigns...........................................................................................122 Participations...........................................................................................................122 Assignments ............................................................................................................123

SECTION 15. MISCELLANEOUS .........................................................................................124 15.1. 15.2. 15.3. 15.4. 15.5. 15.6. 15.7. iv ATL 21975805v8

Power of Attorney ...................................................................................................124 General Indemnity ..................................................................................................125 Survival of and Limitations Upon Indemnities .......................................................126 Modification of Agreement.....................................................................................126 Severability .............................................................................................................126 Cumulative Effect; Conflict of Terms ....................................................................126 Counterparts; Facsimile Signatures ........................................................................127

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15.8. 15.9. 15.10. 15.11. 15.12. 15.13. 15.14. 15.15. 15.16. 15.17. 15.18. 15.19. 15.20. 15.21. 15.22. 15.23. 15.24. 15.25. 15.26.

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Consent ...................................................................................................................127 Notices and Communications .................................................................................127 Performance of Borrowers’ Obligations .................................................................128 Indulgences Not Waivers ........................................................................................128 Entire Agreement; Exhibits and Schedules.............................................................128 Interpretation ...........................................................................................................129 Time of Essence ......................................................................................................129 Obligations of Lenders Several ...............................................................................129 Confidentiality ........................................................................................................129 Governing Law .......................................................................................................130 Credit Inquiries .......................................................................................................130 Consent to Forum ....................................................................................................130 Waivers by Borrowers ............................................................................................130 [Reserved] ...............................................................................................................131 Keepwell .................................................................................................................131 Agent and Lenders as Parties-in-Interest ................................................................131 Waiver of Right to Obtain Alternative Financing...................................................131 Credit Bids ..............................................................................................................131 Conflict of Terms ....................................................................................................132

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LIST OF EXHIBITS AND SCHEDULES Exhibit A Exhibit B Exhibit C Exhibit D Exhibit E Exhibit F Exhibit G Exhibit H Exhibit I Exhibit J Exhibit K Exhibit L

Form of Revolver Note Form of Borrowing Base Certificate [Reserved.] Form of Notice of Borrowing Form of Compliance Certificate [Reserved.] Form of Assignment and Acceptance Form of Notice [Reserved.] [Reserved.] Non-Bank Certificate Form of Interim Order

Schedule A-1 Schedule 1.1 Schedule 8.1.1 Schedule 8.1.2 Schedule 9.1.1

Agent’s Account Designated Account Debtors Borrowers’ Business Locations Insurance Jurisdictions in which Borrowers and each Subsidiary are Authorized to do Business Capital Structure Names [Reserved.] Surety Obligations Tax Identification and Organizational Identification Numbers of Borrowers and Subsidiaries Brokers [Reserved.] Contracts Restricting Borrowers’ Right to Incur Debts Litigation [Reserved.] Pension Plans Collective Bargaining Agreements; Labor Controversies Deposit Accounts Environmental Matters Contingent Obligations Affiliate Transactions Permitted Liens Conditions Subsequent

Schedule 9.1.4 Schedule 9.1.5 Schedule 9.1.7 Schedule 9.1.12 Schedule 9.1.13 Schedule 9.1.14 Schedule 9.1.15 Schedule 9.1.18 Schedule 9.1.19 Schedule 9.1.21 Schedule 9.1.22 Schedule 9.1.24 Schedule 9.1.29 Schedule 9.1.30 Schedule 10.2.3 Schedule 10.2.4 Schedule 10.2.5 Schedule 11.5

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SENIOR SECURED, SUPER-PRIORITY DEBTOR-IN-POSSESSION LOAN AND SECURITY AGREEMENT THIS SENIOR SECURED, SUPER-PRIORITY DEBTOR-IN-POSSESSION LOAN AND SECURITY AGREEMENT (this “Agreement”) is made on April [3], 2017 among CLOTHESLINE HOLDINGS, INC., a Delaware corporation (“Holdings”), ANGELICA CORPORATION, a Missouri corporation (“Angelica”), ANGELICA TEXTILE SERVICES, INC., a California corporation (“Services CA”), ANGELICA TEXTILE SERVICES, INC., a New York corporation (“Services NY”), and ROYAL INSTITUTIONAL SERVICES, INC., a Massachusetts corporation (“RIS”), (Holdings, Angelica, Services CA, Services NY and RIS being referred to collectively as “Borrowers,” and individually as a “Borrower”); the various financial institutions listed on the signature pages hereof (together with their respective successors and permitted assigns, the “Lenders”); WELLS FARGO CAPITAL FINANCE, LLC, in its capacity as collateral and administrative agent for the Lenders pursuant to Section 13 hereof (in such capacity, together with its successors in such capacity, “Agent”) and joint lead arranger; REGIONS BANK, as Co-Collateral Agent; and REGIONS BUSINESS CAPITAL, a division of Regions Bank, as joint lead arranger. R E C I T A L S: WHEREAS, on April 3, 2017 (the “Petition Date”), the Borrowers commenced Chapter 11 Case Nos. 17-10870 through 17-10874, as jointly administered at Chapter 11 Case No. 17-10870 (each a “Chapter 11 Case” and collectively, the “Chapter 11 Cases”), by filing separate voluntary petitions for reorganization under Chapter 11, 11 U.S.C. 101 et seq. (the “Bankruptcy Code”), with the United States Bankruptcy Court for the Southern District of New York (the “Bankruptcy Court”). The Borrowers continue to operate their businesses and manage their properties as debtors and debtors-in-possession pursuant to Sections 1107(a) and 1108 of the Bankruptcy Code; WHEREAS, prior to the Petition Date, certain Lenders provided financing to Angelica, Services CA, Services NY and RIS pursuant to that certain Loan and Security Agreement, dated as of July 15, 2011, among the Borrowers, the other credit parties signatory thereto, Wells Fargo Capital Finance, LLC, as Agent and Lender, and the Lenders from time to time signatory thereto (as amended, modified or supplemented through the Petition Date, the “Prepetition Senior Loan Agreement”), and Holdings guarantied the payment and performance of all of Angelica’s, Services CA’s, Services NY’s and RIS’s obligations under the Prepetition Senior Loan Agreement; WHEREAS, the Borrowers have requested that Lenders provide a senior secured, superpriority revolving credit facility to Borrowers of up to Sixty-Five Million Dollars ($65,000,000) in the aggregate to fund the working capital requirements of the Borrowers during the pendency of the Chapter 11 Cases and to fund other corporate needs and expenses; WHEREAS, Lenders are willing to make certain Postpetition (as defined below) loans and other extensions of credit to Borrowers of up to such amount upon the terms and conditions set forth herein;

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WHEREAS, Borrowers have agreed to secure all of their Obligations (as defined below) under the Loan Documents (as defined below) by granting to Agent, for the benefit of Agent and Secured Parties (as defined below), a security interest in and lien upon all or substantially all of their existing and after-acquired personal and real property; and WHEREAS, each Borrower has agreed to be jointly and severally liable for all loans and other obligations under this Agreement and to guarantee the obligations of each of the other Borrowers under this Agreement and each of the other Loan Documents. NOW, THEREFORE, for good and valuable consideration, the parties hereto, intending to be bound hereby, agree as follows: SECTION 1.

DEFINITIONS; RULES OF CONSTRUCTION

1.1. General Definitions. When used in this Agreement, the following terms shall have the following meanings (terms defined in the singular to have the same meaning when used in the plural and vice versa): “Account Debtor” - a Person who is or becomes obligated under or on account of an Account, Chattel Paper or General Intangible. “Accounts Formula Amount” - on any date of determination thereof, an amount equal to 85% of the net amount of Eligible Accounts on such date. As used herein, the phrase “net amount of Eligible Accounts” shall mean the face amount of such Eligible Accounts on any date less any and all returns, rebates, discounts (which may, at Agent’s option, be calculated on shortest terms), credits, allowances or Taxes (including sales, excise or other taxes) at any time issued, owing, claimed by Account Debtors, granted, outstanding or payable in connection with, or any interest accrued on the amount of, such Accounts at such date. “Acquisition” - (i) the purchase or other acquisition by a Person or its Subsidiaries of all or substantially all of the assets of any other Person, (ii) the purchase or other acquisition (whether by means of a merger, consolidation or otherwise) by a Person of another Person’s line of business or any division of such Person or (iii) the purchase or other acquisition (whether by means of a merger, consolidation or otherwise) by a Person or its Subsidiaries of all, substantially all, or a controlling interest, of the Equity Interests of any other Person. “Advisor” – Alvarez & Marsal, or any other financial advisor reasonably acceptable to Agent. “Affiliate” - a Person (i) who directly or indirectly through one or more intermediaries controls, or is controlled by, or is under common control with, another Person; (ii) who beneficially owns or holds 10% or more of any class of the Equity Interests of another Person; or (iii) 10% or more of the Equity Interests with power to vote of which is beneficially owned or held by another Person or a Subsidiary of another Person. For purposes hereof, “control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of any Equity Interest, by contract or otherwise. 2

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“Agent” - as defined in the Recitals hereto. “Agent Indemnitees” - Agent and Co-Collateral Agent and all of their respective present and future officers, directors, agents and employees. “Agent Professionals” - attorneys, accountants, appraisers, business valuation experts, environmental engineers or consultants, turnaround consultants and other professionals or experts retained by Agent. “Agent’s Account” - the Deposit Account of Agent identified on Schedule A-1. “Agreement” - as defined in the Recitals hereto. “Angelica” - as defined in the Recitals hereto. “Anti-Corruption Laws” – as defined in Section 9.1.33. “Anti-Terrorism Laws” - all relevant laws relating to economic sanctions, terrorism or money laundering, including without limitation Executive Order No. 13224, the Trading with the Enemy Act, the International Emergency Economic Powers Act, the Iran Sanctions Act, the Comprehensive Iran Sanctions, Accountability and Divestment Act, the Iran Threat Reduction and Syria Human Rights Act, the National Defense Authorization Act of 2012, the National Defense Authorization Act of 2013, and the USA PATRIOT Act, and any executive order or regulation promulgated under any of the foregoing. “Applicable Law” - all laws, rules and regulations generally applicable to the Person, conduct, transaction, covenant or Loan Document in question, including all applicable common law and equitable principles; all provisions of all applicable state, federal and foreign constitutions, statutes, rules, regulations and orders of Governmental Authorities; and all orders, judgments and decrees of all courts and arbitrators. “Applicable Margin” - a percentage equal to 4.00%. “Appraised FMV” - the fair market value of the Borrower’s Eligible Real Estate as determined in the most recent Real Estate Appraisal. “Appraised NOLV” - the percentage of the book value of Borrowers’ machinery and Equipment that is estimated to be recoverable in an orderly liquidation of such machinery and Equipment net of all associated costs and expenses of such liquidation, such percentage as determined in the most recent Machinery and Equipment Appraisal. “Approved Budget” – as defined in the DIP Order, as such Approved Budget may be modified or supplemented from time to time in accordance with the DIP Order. “Approved Fund” - any Person (other than a natural person) that is engaged in making, purchasing, holding or investing in bank loans and similar extensions of credit in the Ordinary Course of Business of such Person and that is administered or managed by (i) a Lender, (ii) an 3

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Affiliate of a Lender or (iii) an entity or an Affiliate of an entity that administers or manages a Lender. “Approved Sale Motion” – a Sale Motion seeking Bankruptcy Court approval of a Sale Transaction in form and substance acceptable to Agent, Lenders, Prepetition Senior Agent, and Prepetition Senior Lenders. “Asset Disposition” - a sale, consignment or other transfer or disposition of Property of a Borrower. “Assignment and Acceptance” - an assignment and acceptance entered into by a Lender and an Eligible Assignee and accepted by Agent, in the form of Exhibit G. “Auction Deadline” - means the date which is 70 days after the Petition Date, or such other date agreed upon by Agent and Lenders. “Automatic Stay” – the automatic stay imposed under section 362 of the Bankruptcy Code. “Availability” - on any date, the amount that Borrowers are entitled to borrow as Revolver Loans on such date, such amount being the difference derived when the sum of the principal amount of Revolver Loans then outstanding (including any outstanding Swingline Loans) plus the LC Obligations then outstanding is subtracted from (A) the lesser of (i) the aggregate amount of the Revolver Commitments on such date minus the outstanding amount of Net Prepetition Senior Obligations on such date, and (ii) the Borrowing Base on such date, minus (B) the sum of (i) the Rent Reserve, (ii) the Bank Product Reserve, (iii) the aggregate amount of all liabilities and obligations that are secured by Liens upon any of the Collateral that are senior in priority to Agent’s Liens under the Loan Documents if such Liens are not Permitted Liens (provided that the imposition of a reserve hereunder on account of such Liens shall not be deemed a waiver of the Event of Default that arises from the existence of such Liens) or are Permitted Liens under Section 10.2.5(iii), and (iv) any amounts which any Borrower is obligated to pay to Agent, Lenders or other Persons pursuant to the provisions of any of the Loan Documents that Agent or any Lender elects to pay for the account of such Borrower in accordance with authority contained in any of the Loan Documents. If the amount outstanding is equal to or greater than the Borrowing Base, Availability is zero. “Availability Reserve” - on any date of determination thereof, the amount equal to the sum of: (i) the Inventory Reserve; (ii) the Dilution Reserve; and (iii) such additional reserves, in such amounts and with respect to such matters, as Agent in its Permitted Discretion, or Agent and Co-Collateral Agent collectively in their Permitted Discretion, may elect to impose from time to time based on (a) an event, condition or other circumstance arising after the date hereof, (b) an event, condition or other circumstance existing on the date hereof to the extent that Agent has no knowledge thereof or its effect on the Collateral, (c) any tax liability as determined by Agent in its Permitted Discretion, (d) the Carve-Out, (e) any utility deposits set forth in the Approved Budget to the extent that such utility deposit has not been made, or (f) facts, information, or circumstances, including, without limitation, with respect to any fees, costs, 4

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and/or expenses in connection with the Chapter 11 Cases, provided to or learned by Agent in the course of its administration of the facility that adversely affects or impairs or would reasonably be expected to adversely affect or impair the value of the Collateral or the enforceability or priority of Agent's Lien on the Collateral, impairs the ability of Agent or any Lender to fully realize upon the Collateral or to timely enforce or collect any Obligations, or impairs any Borrower's ability to perform in a timely manner its obligations under this Agreement or the other Loan Documents to which it is a party, as determined by Agent in its Permitted Discretion; provided, that Agent shall give Borrowers contemporaneous notice of the establishment of any such additional reserves established pursuant to this clause (iii). “Average Revolver Loan Balance” - for any period, the amount obtained by adding the unpaid balance of Revolver Loans and LC Obligations at the end of each day for the period in question and by dividing such sum by the number of days in such period. “Bank Products” - any one or more of the following types of products, services or facilities extended to any Borrower or any of its Subsidiaries by any Bank Product Provider: (i) commercial credit cards; (ii) merchant card services; (iii) products or services under Cash Management Agreements; (iv) products under Hedging Agreements; (v) interstate depository network services; and (vi) such other banking products or services provided by any Bank Product Provider as may be requested by any Borrower or any of its Subsidiaries, other than Letters of Credit. “Bank Product Provider” - Wells Fargo or any of its Affiliates (including WFCF) or Regions or any of its Affiliates. “Bank Product Reserve” - means, as of any date of determination, the amount of reserves that Agent has, or that Agent and Co-Collateral Agent collectively have, established (based upon the Bank Product Providers’ reasonable determination of the credit exposure of Parent and its Subsidiaries in respect of Bank Products) in respect of Bank Products then provided or outstanding. “Banking Relationship Debt” - Debt or other obligations of any Borrower or any of its Subsidiaries to any Bank Product Provider arising out of or relating to Bank Products. “Bankruptcy Code” - title 11 of the United States Code. “Bankruptcy Court” – the United States Bankruptcy Court for the Southern District of New York. “Bankruptcy Rules” - the Federal Rules of Bankruptcy Procedure, as the same may from time to time be in effect and applicable to the Chapter 11 Cases. “Bankruptcy Sale” – any sale, disposition, or other transfer of assets pursuant to Section 363 of the Bankruptcy Code. “Base Rate” – for any day, the rate per annum equal to the greatest of: 5

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the LIBOR Rate plus 1.0%,

(b) the rate of interest announced, from time to time, within Wells Fargo at its principal office in San Francisco as its “prime rate”, with the understanding that the “prime rate” is one of Wells Fargo’s base rates (not necessarily the lowest of such rates) and serves as the basis upon which effective rates of interest are calculated for those loans making reference thereto and is evidenced by the recording thereof after its announcement in such internal publications as Wells Fargo may designate; and (c)

the Federal Funds Rate plus 0.50%.

Any change in the Base Rate due to a change in the “prime rate” shall be effective on the effective date of such change in the “prime rate”. “Base Rate Loan” - a Loan, or portion thereof, during any period in which it bears interest at a rate based upon the Base Rate. “Blocked Person” - as defined in Section 9.1.27(ii). “Board of Governors” - the Board of Governors of the Federal Reserve System. “Borrower Agent” - as defined in Section 4.4. “Borrowers” - as defined in the Recitals hereto. “Borrowing” - a borrowing consisting of Loans made on the same day by Lenders (or by WFCF in the case of a Borrowing funded by Swingline Loans). “Borrowing Base” – on any date of determination thereof, an amount equal to the sum of (i) the Accounts Formula Amount on such date, plus (ii) the Inventory Formula Amount on such date, plus (iii) the Fixed Asset Formula Amount on such date, minus (iv) the outstanding amount of Net Prepetition Senior Obligations on such date, minus (v) the Availability Reserve on such date. “Borrowing Base Certificate” - a certificate in the form of Exhibit B, by which Borrowers shall certify to Agent and Lenders the amount of the Borrowing Base as of the date of the certificate and the calculation of such amount. “Business Day” - any day excluding Saturday, Sunday and any other day that is a legal holiday under the laws of the State of New York or is a day on which banking institutions located in any such states are closed. “Capital Expenditures” - expenditures made or liabilities incurred by a Borrower for the acquisition of any fixed assets or improvements, replacements, substitutions or additions thereto which have a useful life of more than one year, including the total principal portion of Capitalized Lease Obligations. 6

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“Capitalized Lease Obligation” - any Debt represented by obligations under a lease that is required to be capitalized for financial reporting purposes in accordance with GAAP. “Carve-Out” – has the meaning provided in the DIP Order. “Carve-Out Amount” - has the meaning provided in the DIP Order. “Cash Collateral” - cash, and any interest or other income earned thereon, that is deposited with Agent in accordance with this Agreement for the Pro Rata benefit of Lenders to Cash Collateralize any LC Obligations. “Cash Collateral Account” - a demand deposit, money market or other account established by Agent at such financial institution as Agent may select in its discretion, which account shall be in Agent’s name and subject to Agent’s Liens. “Cash Collateralize” - with respect to LC Obligations arising from Letters of Credit outstanding on any date, the deposit with Agent of immediately available funds into the Cash Collateral Account in an amount equal to 103% of the sum of the aggregate Undrawn Amounts of such Letters of Credit and all other LC Obligations. “Cash Equivalents” - (a) marketable direct obligations issued by, or unconditionally guaranteed by, the United States or issued by any agency thereof and backed by the full faith and credit of the United States, in each case maturing within 1 year from the date of acquisition thereof, (b) marketable direct obligations issued or fully guaranteed by any state of the United States or any political subdivision of any such state or any public instrumentality thereof maturing within 1 year from the date of acquisition thereof and, at the time of acquisition, having one of the two highest ratings obtainable from either S&P or Moody’s, (c) commercial paper maturing no more than 270 days from the date of creation thereof and, at the time of acquisition, having a rating of at least A-1 from S&P or at least P-1 from Moody’s, (d) certificates of deposit, time deposits, overnight bank deposits or bankers’ acceptances maturing within 1 year from the date of acquisition thereof issued by any bank organized under the laws of the United States or any state thereof or the District of Columbia or any United States branch of a foreign bank having at the date of acquisition thereof combined capital and surplus of not less than $250,000,000, (e) deposit accounts maintained with (i) any bank that satisfies the criteria described in clause (d) above, or (ii) any other bank organized under the laws of the United States or any state thereof so long as the full amount maintained with any such other bank is insured by the Federal Deposit Insurance Corporation, (f) repurchase obligations of any commercial bank satisfying the requirements of clause (d) of this definition or recognized securities dealer having combined capital and surplus of not less than $250,000,000, having a term of not more than seven days, with respect to securities satisfying the criteria in clauses (a) or (d) above, (g) debt securities with maturities of six months or less from the date of acquisition backed by standby letters of credit issued by any commercial bank satisfying the criteria described in clause (d) above, and (h) investments in money market funds substantially all of whose assets are invested in the types of assets described in clauses (a) through (g) above.

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“Cash Management Agreements” - any agreement entered into from time to time between any Borrower or any of its Subsidiaries, on the one hand, and any Lender or any of its Affiliates, on the other, in connection with cash management services for operating, collections, payroll and trust accounts of such Borrower or its Subsidiaries provided by such banking or financial institution, including automatic clearinghouse services, controlled disbursement services, electronic funds transfer services, information reporting services, lockbox services, stop payment services and wire transfer services. “CERCLA” - the Comprehensive Environmental Response Compensation and Liability Act, 42 U.S.C. § 9601 et seq. “Change of Control” - the occurrence of any of the following: (i) the Permitted Holders cease to own and control, beneficially and of record, directly or indirectly, more than 50% of the Equity Interests in Holdings; (ii) Sponsor, together with its Control Investment Affiliates, ceases to own and control, beneficially and of record, directly or indirectly, more than 50% of the voting and economic Equity Interests in Holdings owned by the Permitted Holders; (iii) Holdings ceases to own and control, beneficially and of record, directly or indirectly, 100% of the Equity Interests in Angelica; (iv) all or substantially all of a Borrower’s assets are sold as an entirety to any Person or related group of Persons, except to the extent otherwise expressly permitted by this Agreement; (v) a Borrower is merged with or into another Person, other than a Borrower, except to the extent otherwise expressly permitted by this Agreement; (vi) any Person or related group of Persons acquires by way of a purchase, merger, consolidation or other business combination a majority of the Equity Interests entitled to vote in the election of directors of a Borrower, except to the extent otherwise expressly permitted by this Agreement; or (vii) a change in the majority of the board of directors of a Borrower unless approved by the then majority of the board of directors of such Borrower. “Chapter 11 Cases” – has the meaning set forth in the Recitals of this Agreement. “Claims” - all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, awards, costs (including remedial response costs), charges, expenses and disbursements of any kind or nature (including reasonable attorneys’, accountants’, consultants’, or paralegals’ fees and expenses) which may at any time (including at any time following Full Payment of the Obligations, termination of the Revolver Commitments, resignation or replacement of Agent or replacement of any Lender) be imposed on, incurred by, or asserted against any Indemnitee in any way relating to or arising out of (i) the administration or enforcement of or performance under any of the Loan Documents or consummation of any of the transactions described herein, (ii) any action taken or omitted to be taken by any Indemnitee under or in connection with any of the Loan Documents or Applicable Law, (iii) the existence, perfection or realization upon Agent’s Liens upon any Collateral, (iv) the exercise by Agent or any Lender of any of its rights or remedies under any of the Loan Documents or Applicable Law, or (v) the failure of any Borrower to observe, perform or discharge any of such Borrower’s covenants or duties under any of the Loan Documents or the inaccuracy or incompleteness of any representation or warranty of any Borrower in any of the Loan Documents, in each case including any costs or expenses incurred by any Indemnitee in connection with any investigation, litigation, arbitration or other 8

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judicial or non-judicial proceeding (including any Insolvency Proceeding or appellate proceedings) whether or not such Indemnitee is a party thereto. “Closing Date” - the date on which all of the conditions precedent in Section 11 are satisfied and the initial Loans are made under this Agreement. “Co-Collateral Agent” – for so long as it holds not less than $26,000,000 of the Revolver Commitment, Regions. “Code” - the Internal Revenue Code of 1986, as amended. “Collateral” - all of the Property and interests in Property described in Section 7; all Property described in any of the Security Documents as security for the payment or performance of any of the Obligations; and all other Property and interests in Property that now or hereafter secure (or are intended to secure) the payment and performance of any of the Obligations. “Collection Account” - an account maintained by Agent to which all monies from time to time deposited to a Dominion Account shall be transferred and all other payments shall be sent in immediately available federal funds in accordance with Section 8.2.5 hereof. “Commitment Termination Date” - the date that is the soonest to occur of (i) the last day of the Term; (ii) the date on which either Borrowers or Agent terminates the Revolver Commitments pursuant to Section 6.2; (iii) the date on which the Revolver Commitments are automatically terminated pursuant to Section 12.2, and (iv) the Commitment Termination Date as defined in the DIP Order. “Committees” – collectively, any official committee of unsecured creditors and any other committee formed, appointed, or approved in any Chapter 11 Case and each of such Committees shall be referred to herein as a “Committee”. “Compliance Certificate” - a Compliance Certificate to be provided by Borrowers to Agent in accordance with, and in substantially the form annexed as Exhibit E to, this Agreement, and the supporting schedules to be annexed thereto. “Consolidated” - the consolidation in accordance with GAAP of the accounts or other items as to which such term applies. “Contingent Obligation” - with respect to any Person, any obligation of such Person arising from any guaranty, indemnity or other assurance of payment or performance of any Debt or other obligation (“primary obligations”) of any other Person (the “primary obligor”) in any manner, whether directly or indirectly. The amount of any Contingent Obligation shall be deemed to be an amount equal to the stated or determinable amount of the primary obligation with respect to which such Contingent Obligation is made (or, if less, the maximum amount of such primary obligation for which such Person may be liable pursuant to the terms of the instrument evidencing such Contingent Obligation) or, if not stated or determinable, the maximum reasonably anticipated liability with respect thereto (assuming such Person is required to perform thereunder), as determined by such Person in good faith. 9

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“Control Investment Affiliate” - as to any Person, any other Person that (a) directly or indirectly, is in control of, is controlled by, or is under common control with, such Person and (b) is organized by such Person primarily for the purpose of making equity or debt investments in one or more companies. For purposes of this definition, “control” of a Person means the power, directly or indirectly, to direct or cause the direction of the management and policies of such Person whether by contract or otherwise. “Controlled Disbursement Account” - a demand deposit account maintained by Borrowers at WFCF and to which proceeds of Loans may be wired from time to time. “Current Assets” - at any date, the amount at which all of the current assets of Borrowers would be properly classified as current assets on a balance sheet at such date in accordance with GAAP. “CWA” - the Clean Water Act (33 U.S.C. §§ 1251 et seq.). “Debt” - as applied to a Person means, without duplication: (i) all items which in accordance with GAAP would be included in determining total liabilities as shown on the liability side of a balance sheet of such Person as of the date as of which Debt is to be determined, including Capitalized Lease Obligations; (ii) all Contingent Obligations of such Person; (iii) all reimbursement obligations in connection with letters of credit or letter of credit guaranties issued for the account of such Person; and (iv) in the case of a Borrower (without duplication), the Obligations. The Debt of a Person shall include any recourse Debt of any partnership or joint venture in which such Person is a general partner or joint venturer. “Default” - an event or condition the occurrence of which would, with the lapse of time or the giving of notice, or both, become an Event of Default. “Default Rate” - on any date, a rate per annum that is equal to 2% plus the highest Applicable Margin for Base Rate Loans, plus the Base Rate on such date. “Deposit Account Control Agreement” - each Deposit Account Control Agreement executed by each depository institution of any Borrower in favor of Agent, for the benefit of Secured Parties (including, without limitation, existing Deposit Account Control Agreements executed in connection with the Prepetition Senior Loan Agreement). “Dilution Reserve” – an amount equal to the excess of (i) non-cash reductions to Borrowers’ Accounts during a 12-month period prior to the date of determination as reasonably determined by Agent, expressed as a percentage of Borrowers’ Accounts outstanding during the same period over (ii) 5%, multiplied by an amount equal to Eligible Accounts as of the date of determination. “DIP Order” means the Interim Order or the Final Order (and any amendment, modification or supplement thereto that the Agent and Lenders consent to in writing), whichever is in effect as of the relevant date in question. 10

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“Distressed NOLV” - at any date and with respect to any Eligible Inventory and contracts with customers for the sale or lease of Inventory, the distressed net orderly liquidation value in place of such Eligible Inventory and contracts, expected to be realized at a distressed orderly liquidation sale of such Eligible Inventory and contracts that is held within a reasonable period of time, as such amount is determined by Agent based on the most recent Qualified Appraisal received by Agent on or before such date. “Distribution” - in respect of any entity, (i) any payment of any dividends or other distributions on Equity Interests of the entity (except distributions in such Equity Interests) and (ii) any purchase, redemption or other acquisition or retirement for value of any Equity Interests of the entity unless made contemporaneously from the net proceeds of the sale of Equity Interests. “DNOL Advance Rate” – 70%. “DNOLVIP Amount” - the DNOL Advance Rate times the most recently determined Distressed NOLV of Borrowers’ Eligible Inventory and contracts with customers for the sale or lease of Inventory. “Dollars” and the sign “$ - lawful money of the United States of America. “Domestic Subsidiary” - a Subsidiary that is organized under the laws of the United States or a state thereof. “Dominion Account” - a special account of Agent established by Borrowers at a bank selected by Borrowers, but reasonably acceptable to Agent in its discretion, and over which Agent shall have sole and exclusive access and control for withdrawal purposes. “Eligible Account” - an Account which arises in the Ordinary Course of Business of a Borrower from the sale of goods or rendition of services, is payable in Dollars, is subject to Agent’s valid and duly perfected first priority Lien, and is deemed by Agent, in its Permitted Discretion, to be an Eligible Account. Without limiting the generality of the foregoing, no Account shall be an Eligible Account if: (i) it arises out of a sale made by a Borrower to a Subsidiary or an Affiliate of any Borrower, a Person controlled by an Affiliate of any Borrower or a Blocked Person; (ii) it is unpaid more than 60 days after the original due date shown on the invoice or 90 days after the original invoice date; (iii) it is due more than 90 days after the original invoice date; (iv) 50% or more of the aggregate amount of unpaid Accounts from the Account Debtor are deemed not to be Eligible Accounts hereunder; (v) the aggregate amount of unpaid Accounts from the Account Debtor exceeds 10% of the aggregate amount of all Eligible Accounts or exceeds a credit limit established by Agent of up to 20% of the aggregate amount of all Eligible Accounts for such Account Debtor or such higher credit limit as approved by the Required Lenders , in each case, to the extent of such excess; (vi) any covenant, representation or warranty contained in this Agreement with respect to such Account has been breached; (vii) the Account Debtor is also such Borrower’s creditor or supplier, or has disputed liability with respect to such Account, or has made any claim with respect to any other Account due from such Account Debtor to such Borrower, or the Account otherwise is or may become subject to any 11

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right of setoff, counterclaim, recoupment, reserve, defense or chargeback, provided, that, the Accounts of such Account Debtor shall be ineligible only to the extent of such dispute or right of offset, counterclaim, recoupment, reserve, defense or chargeback; (viii) an Insolvency Proceeding has been commenced by or against the Account Debtor or the Account Debtor has failed, suspended or ceased doing business; (ix) the Account Debtor is not Solvent; (x) the Account Debtor is organized under the laws of any jurisdiction outside of the United States or has its principal office, assets or place of business outside the United States, except to the extent that the Account is supported or secured by a letter of credit or credit insurance that is acceptable in all respects to Agent and duly assigned to Agent; (xi) it constitutes a contra account; (xii) it arises from a sale to the Account Debtor on a bill-and-hold, guaranteed sale, sale-or-return, saleon-approval, consignment or any other repurchase or return basis; (xiii) the Account Debtor is the United States of America or any department, agency or instrumentality thereof, unless the applicable Borrower is not prohibited from assigning the Account and does assign its right to payment of such Account to Agent, in a manner satisfactory to Agent, so as to comply with the Assignment of Claims Act of 1940 (31 U.S.C. § 3727 and 41 U.S.C. § 15), or is a state, county or municipality, or a political subdivision or agency thereof and Applicable Law disallows or restricts an assignment of Accounts on which it is the Account Debtor; provided, that an aggregate amount of up to $5,000,000 of Accounts under this clause (xiii) shall be eligible without the requirement of compliance with the foregoing assignment of claims provisions unless an Event of Default exists; (xiv) the Account Debtor is located in any state which imposes conditions on the right of a creditor to collect accounts receivable unless the applicable Borrower has either qualified to transact business in such state as a foreign entity or filed a Notice of Business Activities Report or other required report with the appropriate officials in such state for the then current year; (xv) the Account Debtor is located in a jurisdiction in which such Borrower is deemed to be doing business under the laws of such jurisdiction and which denies creditors access to its courts in the absence of qualification to transact business in such jurisdiction or of the filing of any reports with such jurisdiction, unless such Borrower has qualified as a foreign entity authorized to transact business in such jurisdiction or has filed all required reports; (xvi) the Account is subject to a Lien other than a Permitted Lien; (xvii) the goods giving rise to such Account have not been delivered to and accepted by the Account Debtor or the services giving rise to such Account have not been performed by such Borrower and accepted by the Account Debtor or the Account otherwise does not represent a final sale; (xviii) the Account is evidenced by Chattel Paper or an Instrument of any kind, or has been reduced to judgment; (xix) the Account represents a progress billing or a retainage or arises from a sale on a cash-on-delivery basis; (xx) such Borrower has made any agreement with the Account Debtor for any deduction therefrom, except for discounts or allowances which are made in the Ordinary Course of Business for prompt payment and which discounts or allowances are reflected in the calculation of the face value of each invoice related to such Account; (xxi) such Borrower has made an agreement with the Account Debtor to extend the time of payment thereof; (xxii) the Account represents, in whole or in part, a billing for interest, fees or late charges, provided, that, such Account shall be ineligible only to the extent of the amount of such billing; (xxiii) the Account Debtor has made a partial payment with respect to such Account or such Account represents a rebilling; (xxiv) it arises from the sale of Inventory that is not Eligible Inventory pursuant to clause (ii) of the definition of “Eligible Inventory”; or (xxv) it arises from a retail sale of Inventory to a Person who is purchasing the same primarily for personal, family or 12

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household purposes; provided, however, that Accounts owing from the Persons named on Schedule 1.1 in an aggregate amount outstanding at any time not to exceed $3,000,000 that are not more than 135 days after the original invoice date but not more than 60 days after the due date may be considered Eligible Accounts. “Eligible Assignee” - a Person that is (i) a Lender, a U.S. based Affiliate of a Lender or an Approved Fund or (ii) a commercial bank, finance company, or other financial institution, in each case that is organized under the laws of the United States or any state, has total assets in excess of $5 billion, extends asset-based lending facilities of the type contemplated herein in the Ordinary Course of Business and whose becoming an assignee would not constitute a prohibited transaction under Section 4975 of the Code or Section 406 of ERISA or any other Applicable Law, is acceptable to Agent and, unless an Event of Default exists, Borrower Agent (such approval by Borrower Agent, when required, not to be unreasonably withheld or delayed; provided that, Borrower Agent shall be deemed to have consented to a proposed assignment unless Borrower Agent objects thereto by written notice to Agent (which notice may be delivered electronically) within 10 Business Days after having received notice thereof); and, provided further, that in no event shall any Borrower or any Affiliate of a Borrower constitute an Eligible Assignee. “Eligible Inventory” - Inventory which is owned by a Borrower (other than packaging or shipping materials, labels, samples, display items, bags, replacement parts and manufacturing supplies) and which Agent, in its Permitted Discretion, deems to be Eligible Inventory. Without limiting the generality of the foregoing, no Inventory shall be Eligible Inventory unless: (i) it is finished goods; (ii) it is held for sale or lease by a Borrower in the Ordinary Course of Business and it is not held by such Borrower on consignment from or subject to any guaranteed sale, saleor-return, sale-on-approval or repurchase agreement with any supplier; (iii) is not damaged, defective, shopworn or otherwise unfit for sale or lease; (iv) it is not slow-moving, obsolete or unmerchantable and is not goods repossessed from an Account Debtor; (v) it meets all standards imposed by any Governmental Authority and does not constitute hazardous materials under any Environmental Law; (vi) it conforms in all respects to the warranties and representations set forth in this Agreement and is fully insured in the manner required by this Agreement; (vii) it is at all times subject to Agent’s duly perfected, first priority Lien and no other Lien except a Permitted Lien; (viii) is not in transit or outside the continental United States and is not consigned to any Person (excluding Inventory in transit in the continental United States between Borrowers or their Subsidiaries and customers of Borrowers or their Subsidiaries in the Ordinary Course of Business); (ix) it is not the subject of a negotiable warehouse receipt or other negotiable Document; (x) it has not been sold and such Borrower has not received any deposit or downpayment in respect thereof in anticipation of a sale; (xi) it is not subject to any License Agreement or other agreement that limits, conditions or restricts such Borrower’s or Agent’s right to sell or otherwise dispose of such Inventory unless the Licensor has entered into a Licensor/Lender Agreement with Agent; and (xii) it is not the subject of an Intellectual Property Claim. “Eligible M&E” – (a) Eligible PILOT Assets and (b) other machinery and Equipment that, in each case in this clause (b), is owned by a Borrower and which Agent, in its Permitted Discretion, deems to be Eligible M&E. Without limiting the generality of the foregoing, no 13

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machinery and Equipment (other than Eligible PILOT Assets) shall be Eligible M&E unless: (i) such Borrower has good, valid and marketable title thereto, (ii) it is not the subject of any Lien other than the first priority perfected Lien granted to the Agent pursuant to the Loan Documents and (iii) it is located at one of the locations in the continental United States set forth on Schedule 8.1.1. “Eligible PILOT Assets” – machinery and Equipment that are subject to the PILOT Lease, so long as (i) the subordination agreement among Agent, IDB and Loan Parties remains in full force and effect; (ii) such machinery and Equipment are not the subject of any Lien other than (a) the first priority perfected Liens granted to the Agent pursuant to the Loan Documents, (b) the Liens granted pursuant to that certain security agreement between IDB and Agent and (c) the Liens permitted under Section 10.2.5(xix), and (iii) such machinery and Equipment are located at one of the locations in the continental United States set forth on Schedule 8.1.1. “Eligible Real Estate” - each owned property listed in Schedule E-4. “Enforcement Action” - action taken or to be taken by Agent, during any period that a Default or an Event of Default exists, to enforce collection of the Obligations or to realize upon the Collateral (whether by judicial action, under power of sale, by self-help repossession, by notification to Account Debtors, or by exercise of rights of setoff or recoupment). “Environmental Action” - means any written complaint, summons, citation, notice, directive, order, claim, litigation, investigation, judicial or administrative proceeding, judgment, letter, or other written communication from any Governmental Authority, or any third party involving violations of Environmental Laws or releases of Hazardous Materials (a) from any assets, properties, or businesses of any Borrower, any Subsidiary of an Borrower, or any of their predecessors in interest, (b) from adjoining properties or businesses, or (c) from or onto any facilities which received Hazardous Materials generated by any Borrower, any Subsidiary of an Borrower, or any of their predecessors in interest. “Environmental Laws” - all federal, state, local and foreign laws (including common law), rules, regulations, codes, ordinances, orders and consent decrees (together with all programs, permits and guidance documents promulgated by regulatory agencies, to the extent having the force of law), now or hereafter in effect, that relate to public health (but excluding occupational safety and health, to the extent regulated by OSHA) or the protection or pollution of the environment, including CERCLA, RCRA and CWA. “Environmental Liabilities”- all liabilities, monetary obligations, losses, damages, costs and expenses (including all reasonable fees, disbursements and expenses of counsel, experts, or consultants, and costs of investigation and feasibility studies), fines, penalties, sanctions, and interest incurred as a result of any claim or demand, or Remedial Action required, by any Governmental Authority or any third party, and which relate to any Environmental Action. “Environmental Release” - a release as defined in CERCLA or under any other applicable Environmental Laws. 14

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“Environmental Reserve” - the aggregate amount of reserves established by Agent from time to time in its Permitted Discretion in respect of Environmental Liabilities, provided that any full or partial release or reduction of any such Environmental Reserves shall be approved by Agent or Agent and Co-Collateral Agent collectively. “Equipment” – means “Equipment” as defined in the UCC. “Equity Interest” - the interest of (i) a shareholder in a corporation, (ii) a partner (whether general or limited) in a partnership (whether general, limited or limited liability), (iii) a member in a limited liability company, or (iv) any other Person having any other form of equity security or ownership interest. “ERISA” - the Employee Retirement Income Security Act of 1974, as amended. “Event of Default” - as defined in Section 12. “Excluded Real Estate” – the Real Estate of Borrowers located at the following addresses: (i)

1145 S. Sierra Nevada Street, Stockton, CA,

(ii)

1409 W. 4th Street, Antioch, CA,

(iii)

1110 Burkburnett Road, Wichita Falls, Texas,

(iv)

1038 Adams Avenue, Montgomery, AL, and

(v)

125 Bath Street, Ballston Spa, NY.

”Excluded Swap Obligation” - with respect to any Borrower, any Swap Obligation if, and to the extent that, all or a portion of the guarantee of such Borrower of, or the grant by such Borrower of a security interest to secure, such Swap Obligation (or any guarantee thereof) is or becomes illegal under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof). “Executive Order No. 13224” - Executive Order No. 13224 on Terrorist Financing, effective September 24, 2001. “Extraordinary Expenses” - all costs, expenses, fees (including fees incurred to Agent Professionals) or advances that Agent or any Lender may suffer or incur during any period that an Event of Default exists, or during the pendency of an Insolvency Proceeding of a Borrower, or at any other time in Agent’s Permitted Discretion, on account of or in connection with (i) the audit, inspection, repossession, storage, repair, appraisal, insuring, completion of the manufacture of, preparing for sale, advertising for sale, selling, collecting or otherwise preserving or realizing upon any Collateral; (ii) any action, suit, litigation, arbitration, contest or other judicial or non-judicial proceeding (whether instituted by or against Agent, any Lender, 15

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any Borrower, any representative of creditors of any Borrower or any other Person) in any way arising out of or relating to any of the Collateral (or the validity, perfection, priority or avoidability of Agent’s Liens with respect to any of the Collateral), any of the Loan Documents or the validity, allowance or amount of any of the Obligations, including any lender liability or other Claims asserted against Agent or any Lender; (iii) the exercise, protection or enforcement of any rights or remedies of Agent in, or the monitoring of, any Insolvency Proceeding; (iv) the settlement or satisfaction of any Liens upon any Collateral (whether or not such Liens are Permitted Liens); (v) the collection or enforcement of any of the Obligations, whether by Enforcement Action or otherwise; (vi) the negotiation, documentation, and closing of any amendment, waiver, restructuring or forbearance agreement with respect to the Loan Documents or Obligations; (vii) amounts advanced by Agent pursuant to Sections 8.1.3 or 15.10; or (viii) the enforcement of any of the provisions of any of the Loan Documents. Such costs, expenses and advances may include transfer fees, taxes, storage fees, insurance costs, permit fees, utility reservation and standby fees, legal fees, appraisal fees, brokers’ fees and commissions, auctioneers’ fees and commissions, accountants’ fees, environmental study fees, wages and salaries paid to employees of any Borrower or independent contractors in liquidating any Collateral, travel expenses, all other fees and expenses payable or reimbursable by Borrowers or any other Borrower under any of the Loan Documents, and all other fees and expenses associated with the enforcement of rights or remedies under any of the Loan Documents, but excluding compensation paid to employees (including inside legal counsel who are employees) of Agent or any Lender. “FATCA” - Sections 1471 through 1474 of the Code and any current or future regulations promulgated thereunder or official interpretations thereof and any agreements entered into pursuant to Section 1471(b) of the Code. “Federal Funds Rate” means, for any period, a fluctuating interest rate per annum equal to, for each day during such period, the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System, as published on the next succeeding 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 Agent from three Federal funds brokers of recognized standing selected by it (and, if any such rate is below zero, then the rate determined pursuant to this definition shall be deemed to be zero). “FEIN” - with respect to any Person, the Federal Employer Identification Number of such Person. “Final Order” means the order of the Bankruptcy Court entered in the Chapter 11 Cases after a final hearing under Bankruptcy Rule 4001(c)(2) or such other procedures as approved by the Bankruptcy Court which order shall be satisfactory in form and substance to the Agent, Lenders, Prepetition Senior Agent, and Prepetition Senior Lenders, and from which no appeal or motion to reconsider has been timely filed, or if timely filed, such appeal or motion to reconsider has been dismissed or denied unless the Agent, Lenders, Prepetition Senior Agent, and Prepetition Senior Lenders waive such requirement), together with all extensions, modifications and amendments thereto, in form and substance satisfactory to Agent, Lenders, Prepetition 16

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Senior Agent, and Prepetition Senior Lenders, which, among other matters but not by way of limitation, authorizes the Borrowers to obtain credit, incur (or guaranty) Indebtedness, and grant Liens under this Agreement and the other Loan Documents, as the case may be, and provides for the super priority of the Agent’s and the Lenders’ claims. “Fiscal Quarter“ - each consecutive period of 13 weeks beginning on the first day of a Fiscal Year (and, in the case of any Fiscal Year of 53 weeks, the 14-week period occurring at the end thereof). “Fiscal Year” - the fiscal year of Borrowers and their Subsidiaries for accounting and tax purposes, which ends on the last Saturday of each January. “Fixed Asset Formula Amount” – on any date of determination thereof, an amount equal to the lesser of (a) $10,070,692 and (b) the sum of (i) 85% of the Appraised NOLV of Eligible M&E on such date plus (ii) 50% of the Appraised FMV of Eligible Real Estate on such date less any Environmental Reserves on such date; provided, that the Fixed Asset Formula Amount shall be reduced on the last day of each calendar month, commencing on the first day of the first full calendar month following the Closing Date, in an amount equal to $245,596 per month. “FLSA” - the Fair Labor Standards Act of 1938. “Foreign Lender” - any Lender that is not a United States person (within the meaning of Section 7701(a)(30) of the Code). “Foreign Subsidiary” - a Subsidiary that is not a Domestic Subsidiary. “Full Payment” - (i) with respect to any of the Obligations, the full and final payment in full, in cash and in Dollars, of such Obligations, including all interests, fees and other charges payable in connection therewith under any of the Loan Documents, whether such interests, fees or other charges accrue or are incurred prior to or during the pendency of an Insolvency Proceeding and whether or not any of the same are allowed or recoverable in any bankruptcy case pursuant to Section 506 of the Bankruptcy Code or otherwise; (ii) with respect to (A) any LC Obligations represented by undrawn Letters of Credit, the depositing of cash with Agent, as security for the payment of such Obligations, not to exceed 103% of the aggregate Undrawn Amount of such Letters of Credit and (B) any Banking Relationship Debt (other than Debt arising under Hedging Agreements), the depositing of cash with Agent, as security for the payment of such Obligations, in an amount to be determined by Agent in its Permitted Discretion up to 103% of the then outstanding Obligations under such Banking Relationship Debt and (C) any Banking Relationship Debt arising under Hedging Agreements, the depositing of cash with Agent, as security for the payment of such Obligations, in an amount to be determined by Agent in its Permitted Discretion up to 110% of Agent’s good faith estimate (determined on a mark-tomarket basis) of the then outstanding Obligations under such Banking Relationship Debt; (iii) with respect to any Obligations that are contingent in nature (other than Obligations consisting of LC Obligations, Banking Relationship Debt or unasserted or future indemnification claims), the depositing of cash with Agent in an amount equal to 100% of such Obligations; (iv) if such Obligations are unliquidated in amount and represent a claim which has been overtly asserted (or 17

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is reasonably probable of assertion) against Agent or a Lender and for which an indemnity has been provided by Borrowers in any of the Loan Documents, in an amount that is equal to such claim or Agent’s good faith estimate of such claim; and (v) the deadline set forth in the DIP Order for any Person to file a complaint or adversary proceeding challenging the amount, extent, validity, or enforceability of the Prepetition Senior Obligations, or the perfection or priority of the Prepetition Senior Liens, or otherwise asserting any claims or causes of action on behalf of the Borrowers’ estates against the Prepetition Senior Agent or the Prepetition Senior Secured Parties relating to the Prepetition Senior Obligations, has expired and any such complaint or adversary proceeding has been resolved. None of the Loans shall be deemed to have been paid in full until all Revolver Commitments related to such Loans have expired or been terminated. “Funded Debt” - Debt consisting of or relating to (a) the borrowing of money or the obtaining of credit (other than trade payables incurred in the Ordinary Course of Business), (b) the deferred purchase price of assets (other than trade payables incurred in the Ordinary Course of Business), and (c) Capitalized Lease Obligations. “GAAP” - generally accepted accounting principles in the United States of America in effect from time to time. “General Intangibles” - as defined in the UCC, including, without limitation, choses in action, causes of action, company or other business records, inventions, blueprints, designs, patents, patent applications, trademarks, trademark applications, trade names, trade secrets, service marks, goodwill, brand names, copyrights, registrations, licenses, franchises, customer lists, permits, tax refund claims, computer programs, operational manuals, internet addresses and domain names, insurance refunds and premium rebates, all rights to indemnification, and all other intangible Property of any kind. “Governmental Approvals” - all authorizations, consents, approvals, licenses and exemptions of, registrations and filings with, and reports to, all Governmental Authorities. “Governmental Authority” - any federal, state, municipal, national, foreign or other governmental department, commission, board, bureau, court, agency or instrumentality or political subdivision thereof or any entity or officer exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to any government or any court, in each case whether associated with a state of the United States, the District of Columbia or a foreign entity or government. “Government Official” - without limitation, all officers or employees of a Governmental Authority; permitting agencies; custom officials; political party officials; candidates for political office; officials of public international organizations (e.g., the Red Cross); employees or affiliates of an enterprise that is owned, sponsored, or controlled by any Governmental Authority; and any other position as defined by applicable Anti-Corruption Laws. “Hazardous Materials” - (a) substances that are defined or listed in, or otherwise classified pursuant to, any applicable laws or regulations as “hazardous substances,” “hazardous materials,” “hazardous wastes,” “toxic substances,” or any other formulation intended to define, 18

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list, or classify substances by reason of deleterious properties such as ignitability, corrosivity, reactivity, carcinogenicity, reproductive toxicity, or “EP toxicity”, (b) oil, petroleum, or petroleum derived substances, natural gas, natural gas liquids, synthetic gas, drilling fluids, produced waters, and other wastes associated with the exploration, development, or production of crude oil, natural gas, or geothermal resources, (c) any flammable substances or explosives or any radioactive materials, and (d) asbestos in any form or electrical equipment that contains any oil or dielectric fluid containing levels of polychlorinated biphenyls in excess of 50 parts per million. “Hedging Agreement” - any interest rate protection agreement, foreign currency exchange agreement, forward contract, currency swap agreement, commodity price protection agreement or other interest or currency exchange rate or commodity price hedging arrangement. “Holdings” - as defined in the Recitals hereto. “IDB” – the Industrial Development Board of the City of Memphis and County of Shelby, Tennessee, a public not-for-profit corporation of the State of Tennessee, with an office in Memphis, Tennessee. “Indemnified Taxes” – any Taxes, but excluding, (i) in the case of each Secured Party, taxes imposed on or measured by the net income or overall gross receipts of such Secured Party (including any branch profits tax or similar tax), in each case (a) imposed as a result of such Secured Party being organized under the laws of, or having its principal office or, in the case of any Lender, its applicable lending office located in, the jurisdiction imposing such Tax (or any political subdivision thereof) or (b) that are Other Connection Taxes, (ii) in the case of each Lender, taxes that would not have been imposed if such Lender had complied with the requirements of Section 5.10, (iii) in the case of any Agent or Lender, any taxes imposed under FATCA on such Agent or Lender and (iv) in the case of a Lender, U.S. federal withholding Taxes imposed on amounts payable to or for the account of such Lender with respect to an applicable interest in a Loan or Commitment pursuant to a law in effect on the date on which (i) such Lender acquires such interest in the Loan or Commitment. “Indemnitees” - the Agent Indemnitees, the Lender Indemnitees, Issuing Bank Indemnitees and WFCF Indemnitees. “Initial Equity Investors” - collectively (i) the Sponsor, (ii) Apollo Investment Corporation (and its Affiliates) and (iii) The Northwestern Mutual Life Insurance Company. “Initial Lenders” - WFCF and Regions, each in its capacity as a “Lender” under this Agreement on the Closing Date. “Insolvency Proceeding” - any action, case or proceeding commenced by or against a Person under any state, federal or foreign law, or any agreement of such Person, for (i) the entry of an order for relief under any chapter of the Bankruptcy Code or other insolvency or debt adjustment law (whether state, federal or foreign), (ii) the appointment of a receiver (or administrative receiver), trustee, liquidator administrator, conservator or other custodian for such Person or any part of its Property, (iii) an assignment or trust mortgage for the benefit of 19

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creditors of such Person, or (iv) the liquidation, dissolution or winding up of the affairs of such Person. “Intellectual Property” - all U.S. and non-U.S. intellectual and similar Property of a Person of every kind and description, including inventions, designs, patents, copyrights, trademarks, service marks, trade names, logos, designs, domain names, mask works, trade secrets, confidential or proprietary information, know-how, software and databases and all embodiments or fixations thereof and related documentation, registrations and franchises, all books and records describing or used in connection with the foregoing and all of the following with respect to the foregoing: (i) all applications therefor; (ii) all renewals, extensions, divisions, continuations or similar related rights thereof; (iii) all income, royalties, damages, and payments now and hereafter due or payable under and with respect thereto, including payments under all licenses entered into in connection therewith and damages and payments for past or future infringements or dilutions thereof, (iv) the right to sue for past, present and future infringements and dilutions thereof; (v) the goodwill of the business symbolized thereby or connected therewith and (vi) all of each Person’s rights corresponding thereto throughout the world. “Intellectual Property Claim” - the assertion by any Person of a claim (whether asserted in writing, by action, suit or proceeding or otherwise) that any Borrower’s ownership, use, marketing, sale or distribution of any Inventory, Equipment, Intellectual Property or other Property is violative of any ownership or right to use any Intellectual Property of such Person. “Intellectual Property License” - with respect to a Person, any license or similar agreement or right of such Person to use Intellectual Property of such Person or which such Person grants to another Person. “Interim Order” – means the order of the Bankruptcy Court entered in the Chapter 11 Cases after an interim hearing (assuming satisfaction of the standards prescribed in Section 364 of the Bankruptcy Code and Bankruptcy Rule 4001 and other applicable law), together with all extension, modifications, and amendments thereto, in form and substance satisfactory to Agent, Lenders, Prepetition Senior Agent, and Prepetition Senior Lenders which, among other matters but not by way of limitation, authorizes, on an interim basis, the Borrowers to execute and perform under the terms of this Agreement and the other Loan Documents, substantially in the form of Exhibit L. “Inventory” – means “Inventory” as defined in the UCC. “Inventory Formula Amount” - on any date of determination thereof, an amount equal to the lesser of (a) $37,500,000, and (b) the sum of (i) with respect to Eligible Inventory that is located at one of Borrowers’ warehouse locations, the least of (A) 95% of the net book value of such Eligible Inventory, and (B) the net orderly liquidation value percentage specified for warehoused inventory as set forth in the most recent inventory appraisal multiplied by the DNOL Advance Rate at the time of determination multiplied by the net book value of such Eligible Inventory plus (ii) with respect to Eligible Inventory that is in service, the lesser of (A) 95% of the net book value of such Eligible Inventory, and (B) the DNOLVIP Amount on such date; provided, however, that in the event Agent receives an inventory appraisal (to the extent such 20

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appraisal was ordered by Agent) reflecting a different net orderly liquidation value percentage than is currently in place with respect to Eligible Inventory located at one of Borrowers’ warehouse locations, or Agent receives a Qualified Appraisal indicating a different Distressed NOLV than is currently in place with respect to Eligible Inventory that is in service, Agent may, in its discretion and following the Lenders’ review of such appraisal or Qualified Appraisal, continue to use the net orderly liquidation value percentage and/or Distressed NOLV reflected in the inventory appraisal or Qualified Appraisal that is currently in place. “Inventory Reserve” - such reserves as may be established from time to time by Agent or Agent and Co-Collateral Agent collectively with respect to changes in the marketability of any Eligible Inventory in the Ordinary Course of Business or such other factors as may negatively impact the value of any Eligible Inventory. Without limiting the generality of the foregoing, such reserves may include reserves based on obsolescence, seasonality, theft or other shrinkage, imbalance, change in composition or mix, markdowns, and vendor chargebacks. “Issuing Bank” - WFCF or any other Lender that, at the request of any Borrower and with the consent of Agent, agrees, in such Lender’s sole discretion, to become an Issuing Bank for the purpose of issuing Letters of Credit or Reimbursement Undertakings pursuant to Section 2.3 of this Agreement. “Issuing Bank Indemnitees” - Issuing Bank, the Underlying Issuer and all of their present and future officers, directors, employees and agents. “LC Application” - an application by any or all Borrowers to Issuing Bank, pursuant to a form approved by Issuing Bank or the Underlying Issuer, as the context requires, for the issuance of a Letter of Credit, that is submitted to Issuing Bank at least 5 Business Days (or such shorter period as may be acceptable to Issuing Bank) prior to the requested issuance of such Letter of Credit. “LC Conditions” - the following conditions, the satisfaction of each of which is required before Issuing Bank or the Underlying Issuer, as the context requires, shall be obligated to issue a Letter of Credit: (i) each of the conditions set forth in Section 11 has been and continues to be satisfied, including the absence of any Default or Event of Default; (ii) after giving effect to the issuance of the requested Letter of Credit and all other unissued Letters of Credit for which an LC Application has been signed by a Borrower and approved by Agent and such Issuing Bank or such Underlying Issuer, (a) the LC Obligations would not exceed $35,000,000 less the amount of outstanding Prepetition Senior Letters of Credit, and (b) no Out-of-Formula Condition would exist, and, (c) if no Revolver Loans are outstanding, the LC Obligations do not, and would not upon the issuance of the requested Letter of Credit, exceed the Borrowing Base; (iii) such Letter of Credit has an expiration date that is no more than 365 days from the date of issuance in the case of standby Letters of Credit (although such Letters of Credit may be subject to customary automatic renewal provisions so long as the final expiration date is no later than 30 days prior to the last Business Day of the Term) and no more than 120 days from the date of issuance in the case of documentary Letters of Credit and, in either event, such expiration date is at least 30 days prior to the last Business Day of the Term unless otherwise agreed by Agent in its discretion; (iv) the currency in which payment is to be made under the Letter of Credit is Dollars; and (v) the 21

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form of the proposed Letter of Credit is reasonably satisfactory to Agent and Issuing Bank or the Underlying Issuer, as the context requires, and does not contain any language that automatically increases the amount available to be drawn under the Letter of Credit. “LC Documents” - any and all agreements, instruments and documents (other than an LC Application) required by Issuing Bank or the Underlying Issuer, as the context requires, to be executed by Borrowers or any other Person and delivered to Issuing Bank or the Underlying Issuer for the issuance, amendment or renewal of a Letter of Credit. “LC Facility” - the subfacility for Letters of Credit established as part of the Revolver Commitments pursuant to Section 2.3. “LC Obligations” - on any date, an amount (in Dollars) equal to the sum of (without duplication) (i) all amounts then due and payable by any Borrower on such date by reason of any payment that is made by Issuing Bank or the Underlying Issuer under a Letter of Credit and that has not been repaid to Issuing Bank or the Underlying Issuer, plus (ii) the aggregate undrawn amount of all Letters of Credit which are then outstanding or for which an LC Application has been delivered to and accepted by Issuing Bank or the Underlying Issuer, plus (iii) all fees and other amounts due or to become due in respect of Letters of Credit outstanding on such date. “LC Request” - a Letter of Credit Request from Borrowers to Issuing Bank in the form of and substance acceptable to Issuing Bank. “Lender Indemnitees” - Lenders and all of their respective present and future officers, directors, employees and agents. “Lenders” - shall have the meaning given to it in the preamble to this Agreement and shall include WFCF (whether in its capacity as a provider of Loans under Section 2, as the provider of Swingline Loans under Section 4.1.3, or as the issuer of Letters of Credit under Section 2.3), Regions and any other Person who may from time to time become a “Lender” under this Agreement. “Letter of Credit” - a letter of credit (as that term is defined in the UCC) issued by Issuing Bank or a letter of credit (as that term is defined in the UCC) issued by Underlying Issuer, as the context requires “LIBOR Rate” – as of any date of determination, the rate per annum for United States dollar deposits determined by Agent for the purpose of calculating the effective interest rate for loans that reference the LIBOR Rate as the Inter-Bank Market Offered Rate in effect from time to time for the 3 month delivery of funds in amounts approximately equal to the principal amount of such loans (and, if such rate is below zero, the LIBOR Rate shall be deemed to be zero). Borrowers understand and agree that Agent may base its determination of the Inter-Bank Market Offered Rate upon such offers or other market indicators of the Inter-Bank Market as Agent in its discretion deems appropriate, including but not limited to the rate offered for U.S. dollar deposits on the London Inter-Bank Market. When interest is determined hereunder in relation to LIBOR Rate, each change in the interest rate hereunder shall become effective each Business Day that Agent determines that the LIBOR Rate has changed. 22

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“License Agreement” - any agreement between a Borrower and a Licensor pursuant to which such Borrower is authorized to use any Intellectual Property in connection with the manufacturing, marketing, sale or other distribution of any Inventory of such Borrower. “Licensor” - any Person from whom a Borrower obtains the right to use (whether on an exclusive or non-exclusive basis) any Intellectual Property in connection with such Borrower’s manufacture, marketing, sale or other distribution of any Inventory. “Licensor/Lender Agreement” - an agreement between Agent and a Licensor by which Agent is given the unqualified right, vis-à-vis such Licensor, to enforce Agent’s Liens with respect to and to dispose of a Borrower’s Inventory with the benefit of any Intellectual Property applicable thereto, irrespective of such Borrower’s default under any License Agreement with such Licensor and which is otherwise in form and substance satisfactory to Agent. “Lien” - any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), preference, priority or other security agreement of any kind or nature whatsoever (including any conditional sale or other title retention agreement, any financing or similar statement or notice filed under the UCC or any other similar recording or notice statute, and any lease having substantially the same effect as any of the foregoing). “Lien Waiver” - an agreement duly executed in favor of Agent, in form and content reasonably acceptable to Agent, by which (i) for locations leased by a Borrower, an owner or mortgagee of premises upon which any Property of a Borrower is located agrees to waive or subordinate any Lien it may have with respect to such Property in favor of Agent’s Lien therein and to permit Agent to enter upon such premises and remove such Property or to use such premises to store or dispose of such Property (or at Agent’s election in lieu of a Lien Waiver, the establishment by Agent of a Rent Reserve), or (ii) for other locations that are not owned by a Borrower and at which any Borrower places any other Collateral, a waiver or subordination by the owner of such premises of its Lien in any of the Collateral and its agreement to permit Agent access to such premises to remove such Collateral unless, at Agent’s election, a Rent Reserve has been established by Agent. “Loan” - a Revolver Loan Advance (and each Base Rate Loan comprising such Loan). “Loan Account” - the loan account established by each Lender on its books pursuant to Section 5.8. “Loan Documents” - this Agreement, the Other Agreements and the Security Documents. “Local Bankruptcy Rules” – the local bankruptcy rules of the Bankruptcy Court as the same may from time to time be in effect and applicable to the Chapter 11 Cases. “Machinery and Equipment Appraisal” - a written appraisal of the Eligible M&E addressed and delivered to Agent, in form, scope and methodology acceptable to Agent in its Permitted Discretion and prepared by Hilco, or an appraisal acceptable to Agent. “Margin Stock” - shall have the meaning ascribed to it in Regulation U. 23

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“Material Adverse Effect” - the effect of any event, condition, action, omission or circumstance, which, alone or when taken together with other events, conditions, actions, omissions or circumstances occurring or existing concurrently therewith, (i) has a material adverse effect upon the business, operations, Properties, or condition (financial or otherwise) of Borrowers, taken as a whole; (ii) has or would be reasonably expected to have any material adverse effect upon the validity or enforceability of this Agreement or any of the other Loan Documents; (iii) has any adverse effect upon the value of the whole or any material part of the Collateral or the priority of Agent’s Lien on such Collateral; or (iv) materially impairs the ability of Agent or any Lender to enforce or collect the Obligations or realize upon any of the Collateral in accordance with the Loan Documents and Applicable Law; provided, that Material Adverse Effect shall expressly exclude (i) any matters publicly disclosed prior to the filing of the Chapter 11 Cases, (ii) any matters disclosed to Agent and Lenders on or prior to the date hereof in connection herewith (including the Schedules or Exhibits hereto) or otherwise disclosed to Agent and Lenders on or prior to the date hereof in connection with any other Loan Document, the Transaction, or the Chapter 11 Cases, (iii) any matters disclosed in any first day pleadings or declarations, and (iv) the effect of filing the Chapter 11 Cases. “Material Contract” - an agreement to which an Borrower is a party (other than the Loan Documents) (i) which involves annual billings in excess of (x) $5,000,000 in respect of an agreement with a customer of such Borrower or (y) $5,000,000 in respect of an agreement with a supplier of such Borrower or (ii) for which breach, termination, cancellation, nonperformance or failure to renew would reasonably be expected to have a Material Adverse Effect. “Maximum Rate” - the maximum non-usurious rate of interest permitted by Applicable Law that at any time, or from time to time, may be contracted for, taken, reserved, charged or received on the Debt in question or, to the extent that at any time Applicable Law may thereafter permit a higher maximum non-usurious rate of interest, then such higher rate. Notwithstanding any other provision hereof, the Maximum Rate shall be calculated on a daily basis (computed on the actual number of days elapsed over a year of 360 days). “Maximum Revolver Amount” - $65,000,000. “Money Borrowed” - as applied to any Borrower, without duplication, (i) Debt arising from the lending of money by any other Person to such Borrower; (ii) Debt, whether or not in any such case arising from the lending of money by another Person to such Borrower, (A) which is represented by notes payable or drafts accepted that evidence extensions of credit, (B) which constitutes obligations evidenced by bonds, debentures, notes or similar instruments, or (C) upon which interest charges are customarily paid (other than accounts payable) or that was issued or assumed as full or partial payment for Property; (iii) Debt that constitutes a Capitalized Lease Obligation; (iv) reimbursement obligations with respect to letters of credit or guaranties of letters of credit; and (v) Debt of such Borrower under any guaranty of obligations that would constitute Debt for Money Borrowed under clauses (i) through (iii) hereof, if owed directly by such Borrower. “Moody’s” - Moody’s Investors Services, Inc. 24

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“Multiemployer Plan” - has the meaning set forth in Section 4001(a)(3) of ERISA. “Net Disposition Proceeds” - with respect to a Permitted Asset Disposition, proceeds (including cash receivable (when received) by way of deferred payment) received by a Borrower in cash from such Asset Disposition, net of: (i) the reasonable and customary costs and expenses actually incurred in connection with such Asset Disposition (including legal fees and sales commissions); (ii) amounts applied to repayment of Debt (other than the Obligations) secured by a Permitted Lien on such Collateral disposed of that is senior in priority to Agent’s Liens; (iii) transfer or similar taxes; and (iv) reserves for escrows and indemnities, until such reserves are no longer required and such reserves or escrows are released to a Borrower. “Net Prepetition Senior Obligations” - on any date, the aggregate outstanding amount of Prepetition Senior Obligations, other than Prepetition Letters of Credit that have been Cash Collateralized (as defined in the Prepetition Senior Loan Agreement) in accordance with the terms of the Prepetition Senior Loan Agreement. Notice of Borrowing” - as defined in Section 4.1.1(i). “Obligations” - in each case, whether now in existence or hereafter arising, (i) the principal of, and interest and premium, if any, on the Loans, (ii) all LC Obligations and all other obligations of any Borrower to Agent or WFCF or the Underlying Issuer arising in connection with the issuance of any Letter of Credit, (iii) all liabilities and obligations of any Borrower under any indemnity for Claims, (iv) all Extraordinary Expenses, and (v) all other Debts, covenants, duties and obligations (including Contingent Obligations) now or at any time or times hereafter owing by any Borrower to Agent or any Lender under or pursuant to this Agreement or any of the other Loan Documents, or owing by any Borrower to Agent or any Bank Product Provider with respect to Banking Relationship Debt, in each case, whether evidenced by any note or other writing, whether arising from any extension of credit, opening of a letter of credit, acceptance, loan, guaranty, indemnification or otherwise and whether direct or indirect, absolute or contingent, due or to become due, primary or secondary, or joint or several, including all interest, charges, expenses, fees or other sums chargeable to any or all Borrowers under any of the Loan Documents. “Ordinary Course of Business” - with respect to any transaction involving any Person, the ordinary course of such Person’s business, as conducted by such Person in good faith. “Organic Documents” - with respect to any Person as applicable, its charter, certificate or articles of incorporation, bylaws, articles of organization, limited liability agreement, operating agreement, members agreement, shareholders agreement, partnership agreement, certificate of partnership, certificate of formation, voting trust, or similar agreement or instrument governing the formation or operation of such Person. “OSHA” - the Occupational Safety and Health Act of 1970 (29 U.S.C.§§651 et seq.). “Other Agreements” - the Revolver Notes, each Lien Waiver, the Prepetition Intercreditor Agreement, and any and all other agreements, instruments and documents (other than this Agreement and the Security Documents), heretofore, now or hereafter executed by any 25

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Borrower, or any other Person and delivered to Agent or any Lender, or otherwise executed by Agent or any Lender in favor of any Person on behalf or for the account of a Borrower, in each case in respect of the transactions contemplated by this Agreement or other Loan Documents, in each case as may be amended, restated, supplemented or otherwise modified from time to time. “Other Connection Taxes” - with respect to any Agent or Lender, Taxes imposed as a result of a present or former connection between such Agent or Lender and the jurisdiction imposing such Tax (other than connections arising from such Agent or Lender having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced any Loan Document, or sold or assigned an interest in any Loan or Loan Document). “Other Taxes” - all present or future stamp, court or documentary, intangible, recording, filing or similar Taxes or any other excise or property Taxes or similar levies that arise from any payment made under, from the execution, delivery, performance, enforcement or registration of, from the receipt or perfection of a security interest under, or otherwise with respect to, any Loan Document except any such Taxes that are Other Connection Taxes imposed with respect to an assignment, other than an assignment pursuant to Section 13.17. “Out-of-Formula Condition” - as defined in Section 2.2.2. “Out-of-Formula Loan” - a Revolver Loan made or existing when an Out-of-Formula Condition exists or the amount of any Revolver Loan which, when funded, results in an Out-ofFormula Condition. “Participant” - as defined in Section 14.2.1. “Participating Lender” - as defined in Section 2.4.2(i). “Payment Items” - each check, draft, or other item of payment payable to a Borrower, including those evidencing or constituting proceeds of any of the Collateral. “Pending Revolver Loans” - at any date, the aggregate principal amount of all Revolver Loans which have been requested in any Notice of Borrowing received by Agent but which have not theretofore been advanced by Agent or Lenders. “Permitted Asset Disposition” - an Asset Disposition that: (i)

consists of: (a)

the sale of Inventory of a Borrower in the Ordinary Course of Business;

(b) a disposition of Inventory that has become obsolete, unmerchantable or otherwise unsalable or unusable in the Ordinary Course of Business of the Borrower making such disposition and does not constitute Eligible Inventory and the disposition of which would be permissible under the Bankruptcy Code without the Bankruptcy Court’s approval and/or the necessity of the filing of Sale Motion with respect thereto; 26

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(c) solely of a termination of a lease of real or personal Property in the Ordinary Course of Business that is not necessary to the conduct of a Borrower’s business which would be permissible under the Bankruptcy Code without the Bankruptcy Court’s approval; (d) a deposit to secure an obligation to the extent such deposit is permitted under Section 10.2.5(viii); (e) dispositions of Cash Equivalents in the Ordinary Course of Business in exchange for other Cash Equivalents or cash; (f)

any Asset Disposition pursuant to an Approved Sale Motion;

(g) any other Asset Disposition that has been consented to in writing by Agent and the Required Lenders; or (ii) so long as no Event of Default exists or would result therefrom (which would be permissible under the Bankruptcy Code without the Bankruptcy Court’s approval): (a) is the sale of surplus, obsolete or worn out Equipment in the Ordinary Course of Business by any Borrower or any of its Subsidiaries; (b) is the sale, transfer or other disposition of delinquent Accounts in the Ordinary Course of Business for the purposes of collection and not as part of an accounts receivables financing transaction (provided that such Accounts are not Eligible Accounts); (c) is the sale, transfer, lease and other disposition of intellectual property in the Ordinary Course of Business consisting of the abandonment of such intellectual property rights which in the reasonable good faith determination of Borrowers, are not material to the conduct of the business of Borrowers and their Subsidiaries; or (d) is a voluntary termination of Hedging Agreements in the Ordinary Course of Business of a Borrower that does not have a material adverse effect on the business of such Borrower or its future operations; provided, that in either case, all Net Disposition Proceeds are remitted to Agent for application to the Obligations and the Prepetition Senior Obligations in accordance with the DIP Order. “Permitted Contingent Obligations” - Contingent Obligations arising from endorsements of items of payment for collection or deposit in the Ordinary Course of Business; Contingent Obligations arising from Hedging Agreements entered into in the Ordinary Course of Business; Contingent Obligations of any Borrower and its Subsidiaries existing as of the Closing Date, including extensions and renewals thereof that do not increase the amount of such Contingent Obligations as of the date of such extension or renewal; Contingent Obligations arising under indemnity agreements to title insurers to cause such title insurers to issue to Agent title insurance policies; Contingent Obligations with respect to customary indemnification obligations in favor 27

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of purchasers in connection with dispositions of Equipment permitted under Section 8.4.2; Contingent Obligations consisting of reimbursement obligations from time to time owing by any Borrower to Issuing Bank with respect to Letters of Credit (but in no event to include reimbursement obligations at any time owing by a Borrower to any other Person that may issue letters of credit for the account of Borrowers); Contingent Obligations provided on Schedule 10.2.3. “Permitted Discretion” - Agent’s (or, as applicable Co-Collateral Agent’s) judgment exercised in good faith, based upon its consideration of any factor that it reasonably believes (a) could adversely affect the quantity, quality, mix or value of Collateral (including any applicable law that may inhibit collection of an Account), the enforceability or priority of Agent’s Liens, or the amount that Agent and Lenders could receive in liquidation, including, without limitation, any Bankruptcy Sale, of any Collateral; or (b) suggests that any collateral report or financial information delivered by any Borrower is incomplete, inaccurate or misleading in any material respect. “Permitted Holders” – collectively, Sponsor and each other Initial Equity Investor and each Control Investment Affiliate of Sponsor or other Initial Equity Investor. “Permitted Junior DIP Debt”- Debt incurred by one or more of the Borrowers under a Permitted Junior DIP Facility to the extent that (a) all such Debt is subordinated to the Obligations and the Prepetition Senior Obligations on terms satisfactory to Agent, Lenders, Prepetition Senior Agent and Prepetition Senior Lenders pursuant to a Permitted Junior DIP Order, and (b) no such Debt is incurred under such Permitted Junior DIP Facility until after the Full Payment of the Obligations and the Full Payment (as defined in the Prepetition Senior Loan Agreement) of the Prepetition Senior Obligations. “Permitted Junior DIP Facility”- a credit facility provided to one or more of the Borrowers after the Petition Date in accordance with the terms of a Permitted Junior DIP Order and Permitted Junior DIP Loan Documents to the extent that (a) such credit facility, the incurrence of Debt thereunder and the creation of Liens with respect thereto are approved by the Bankruptcy Court pursuant to the terms of a Permitted Junior DIP Order, and (b) such credit facility is entered into, and such Debt is incurred thereunder, in connection with a Sale Transaction for which Bankruptcy Court authority is sought pursuant to an Approved Sale Motion. “Permitted Junior DIP Liens”- Liens granted to the agent or lender(s) that provide a Permitted Junior DIP Facility to one or more of the Borrowers to the extent that (a) the obligations secured by such Liens are limited to Permitted Junior DIP Debt, and (b) all such Liens are subordinated to the Agent’s Liens and the Prepetition Senior Agent’s Liens on terms satisfactory to Agent, Lenders, Prepetition Senior Agent and Prepetition Senior Lenders pursuant to a Permitted Junior DIP Order. “Permitted Junior DIP Loan Documents” – any and all documents executed in connection with the Permitted Junior DIP Facility, in each case in form and substance satisfactory to Agent, Lenders, Prepetition Senior Agent and Prepetition Senior Lenders. 28

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“Permitted Junior DIP Order” - means an order of the Bankruptcy Court entered in the Chapter 11 Cases after a hearing (assuming satisfaction of the standards prescribed in Section 364 of the Bankruptcy Code and Bankruptcy Rule 4001 and other applicable law), together with all extensions, modifications, and amendments thereto, in each case in form and substance satisfactory to Agent, Lenders, Prepetition Senior Agent and Prepetition Senior Lenders, which authorizes one or more of the Borrowers to incur the Permitted Junior DIP Debt and the Permitted Junior DIP Liens and to perform their obligations under the Permitted Junior DIP Facility and the Permitted Junior DIP Loan Documents “Permitted Lien” - a Lien of a kind specified in Section 10.2.5. “Permitted Senior Lien” means any Prior Lien (as defined in the DIP Order), and any valid, enforceable, and non-avoidable Lien that was perfected prior to the Petition Date (or perfected on or after the Petition Date to the extent permitted by Section 546(b) of the Bankruptcy Code), which is not subject to avoidance, reduction, disallowance, impairment or subordination pursuant to the Bankruptcy Code or applicable non-bankruptcy law and which is senior in priority to the Liens of the Prepetition Senior Agent and Prepetition Senior Secured Parties under applicable law and after giving effect to any subordination or inter-creditor agreements; provided that this definition shall exclude the Liens: (x) of both the Prepetition Senior Agent and the Prepetition Senior Secured Parties arising under the Prepetition Senior Loan Documents and (y) of both the Prepetition Junior Agent and the Prepetition Junior Lenders arising under the Prepetition Junior Loan Documents, which Liens shall be subordinate to the Liens securing the Obligations. “Permitted Variances” –means (a) with respect to the aggregate amount of expenditures shown in any Approved Budget for any four week period, an amount not to exceed 107.5% of the amount shown in the applicable Approved Budget for such period, and (b) with respect to Borrowers’ aggregate income for any four week period shown in the applicable Approved Budget, an amount not less than 92.5% of the amount shown for such period. “Person” - an individual, partnership, corporation, limited liability company, limited liability partnership, joint stock company, land trust, business trust, or unincorporated organization, or a Governmental Authority. “Petition Date” – has the meaning set forth in the Recitals of this Agreement. “Plan” - an employee pension benefit plan that is covered by Title IV of ERISA or subject to the minimum funding standards under Section 412 of the Internal Revenue Code and that is either (i) maintained by a Borrower for employees or (ii) maintained pursuant to a collective bargaining agreement or any other arrangement under which more than one employer makes contributions and to which a Borrower is then making or accruing an obligation to make contributions or has within the preceding 5 years made or accrued such contributions. “Postpetition” means the time period beginning immediately upon the filing of the Chapter 11 Cases. 29

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“Prepetition” means the time period ending immediately prior to the filing of the Chapter 11 Cases. “Prepetition Intercreditor Agreement” – that certain Intercreditor Agreement among the Prepetition Senior Agent, the Prepetition Junior Agent, and Angelica dated as of August 20, 2013, as amended, restated, supplemented or otherwise modified from time to time in accordance with the terms thereof. “Prepetition Junior Agent” – Cortland Capital Markets Services LLC, together with its successors and assigns. “Prepetition Junior Debt” – Debt incurred by any Borrower or any of its Subsidiaries under the Prepetition Junior Loan Documents. “Prepetition Junior Lenders” – the lenders party to the Prepetition Junior Loan Agreement from time to time. “Prepetition Junior Loan Agreement” – that certain Amended and Restated Loan and Security Agreement, dated as of July 12, 2016, among Angelica, Holdings, the other Guarantors (as defined therein) party thereto from time to time, the Prepetition Junior Agent and the Prepetition Junior Lenders, as the same may be amended, restated, supplemented or otherwise modified from time to time in accordance therewith and in accordance with the Prepetition Intercreditor Agreement. “Prepetition Junior Loan Documents” – the Prepetition Junior Loan Agreement, and all agreements, instruments or documents executed or delivered in connection therewith, including, without limitation, the “Loan Documents” as defined therein, in each case, as the same may be amended, restated, supplemented or otherwise modified from time to time in accordance therewith and in accordance with the Prepetition Intercreditor Agreement. “Prepetition Senior Agent” - means WFCF in its capacity as administrative agent under the Prepetition Senior Loan Agreement. “Prepetition Senior Cash Collateral Account” – a Cash Collateral Account (as defined in the Prepetition Senior Loan Agreement). “Prepetition Senior Lenders” – means the lenders party to the Prepetition Senior Loan Agreement. “Prepetition Senior Letters of Credit” – means all Letters of Credit issued under and as defined in the Prepetition Senior Loan Agreement. “Prepetition Senior Loan Agreement” - means that certain Loan and Security Agreement dated as of July 15, 2011, by and among Holdings, Borrowers, Prepetition Senior Agent, and Prepetition Senior Lenders.

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“Prepetition Senior Loan Documents” – means the Prepetition Senior Loan Agreement, along with any other agreements and documents executed or delivered in connection therewith, including, without limitation, the “Loan Documents” as defined therein. “Prepetition Senior Obligations” – means all obligations arising under the Prepetition Senior Loan Agreement (including, without limitation, the “Obligations” as defined therein) or any other Prepetition Senior Loan Document. “Prepetition Senior Secured Parties” - means the Secured Parties as defined in the Prepetition Senior Loan Agreement, including, without limitation, the Prepetition Senior Lenders. “Pro Rata” - with respect to any Lender on any date, a percentage (expressed as a decimal, rounded to the fourth decimal place) arrived at by dividing the amount of the total Revolver Commitments of such Lender on such date by the aggregate amount of the Revolver Commitments of all Lenders on such date (regardless of whether or not any of such Revolver Commitments have been terminated on or before such date). “Properly Contested” - in the case of any Debt of a Borrower (including any Taxes) that is not paid as and when due or payable by reason of such Borrower’s bona fide dispute concerning its liability to pay same or concerning the amount thereof, (i) such Debt is being properly contested in good faith by appropriate proceedings promptly instituted and diligently conducted; (ii) such Borrower has established appropriate reserves as shall be required in conformity with GAAP; (iii) the non-payment of such Debt will not have a Material Adverse Effect and will not result in a forfeiture or sale of any assets of such Borrower; (iv) no Lien is imposed upon any of such Borrower’s assets with respect to such Debt unless such Lien is at all times junior and subordinate in priority to the Liens in favor of Agent (except only with respect to property taxes that have priority as a matter of Applicable Law) and enforcement of such Lien is stayed during the period prior to the final resolution or disposition of such dispute; (v) if the Debt results from, or is determined by the entry, rendition or issuance against an Borrower or any of its assets of a judgment, writ, order or decree, enforcement of such judgment, writ, order or decree is stayed pending a timely appeal or other judicial review; and (vi) if such contest is abandoned, settled or determined adversely (in whole or in part) to such Borrower, such Borrower forthwith pays such Debt and all penalties, interest and other amounts due in connection therewith. “Property” - any interest in any kind of property or asset, whether real, personal or mixed and whether tangible or intangible. “Qualified Appraisal” - an appraisal of the distressed orderly liquidation value in place of Inventory of Borrowers performed by an appraiser reasonably satisfactory to Agent, which appraisal shall include, without limitation, as a factor in the determination of distressed orderly liquidation value in place, all costs and expenses projected to be incurred in the conduct of any liquidation of all or any portion of the Inventory. “RCRA” - the Resource Conservation and Recovery Act (42 U.S.C. §§6901 et seq.). 31

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“Real Estate” - all right, title and interest of a Borrower (whether as owner, lessor or lessee) at any time or times held by such Borrower in any real Property or any buildings, structures, parking areas or other improvements thereon. “Real Estate Appraisal” - a written appraisal of the Eligible Real Estate addressed and delivered to Agent, in form, scope and methodology acceptable to Agent in its Permitted Discretion and by an appraiser acceptable to Agent, addressed to Agent. “Realty” - as defined in the Recitals hereto. “Refinancing Conditions” - the following conditions, each of which must be satisfied before Refinancing Debt shall be permitted under Section 10.2.3: (i) the Refinancing Debt is in an aggregate principal amount that does not exceed the aggregate principal amount of the Debt being extended, renewed or refinanced plus accrued interest and reasonable and customary transaction expenses, (ii) the Refinancing Debt has a later or equal final maturity and a longer or equal weighted average life than the Debt being extended, renewed or refinanced, (iii) the Refinancing Debt does not bear a rate of interest that exceeds, as of the date of such extension, renewal or refinancing, a market rate (as determined in good faith by a Senior Officer) for Debt of such type issued by an entity similar to the Borrower that is liable on the Debt being extended, renewed or refinanced, (iv) if the Debt being extended, renewed or refinanced is subordinate to the Obligations, the Refinancing Debt is subordinated to the same extent, (v) the covenants contained in any instrument or agreement relating to the Refinancing Debt taken as a whole are materially no less favorable to Borrowers than those relating to the Debt being extended, renewed or refinanced, (vi) at the time of and after giving effect to such extension, renewal or refinancing, no Default or Event of Default shall exist, (vii) no additional Lien is granted to secure the repayment of the Refinancing Debt, and (viii) no additional Person is or may become obligated on the Refinancing Debt. “Refinancing Debt” - Debt for Money Borrowed that is permitted by Section 10.2.3 and that is the subject or the result of an extension, renewal or refinancing. “Regions” - Regions Bank, an Alabama banking corporation, and its successors and assigns. “Register” - the register maintained by Agent in accordance with Section 5.8.2. “Regulation D” - Regulation D of the Board of Governors. “Regulation T” - Regulation T of the Board of Governors as from time to time in effect and any successor to all or a portion thereof. “Regulation U” - Regulation U of the Board of Governors as from time to time in effect and any successor to all or a portion thereof. “Regulation X” - Regulation X of the Board of Governors as from time to time in effect and any successor to all or a portion thereof. 32

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“Reimbursement Date” - as defined in Section 2.3.1(iii). “Reimbursement Undertaking” – as defined in Section 2.3.1. “Remedial Action” - all actions taken to (a) clean up, remove, remediate, contain, treat, monitor, assess, evaluate, or in any way address Hazardous Materials in the indoor or outdoor environment, (b) prevent or minimize a release or threatened release of Hazardous Materials so they do not migrate or endanger or threaten to endanger public health or welfare or the indoor or outdoor environment, (c) restore or reclaim natural resources or the environment, (d) perform any pre-remedial studies, investigations, or post-remedial operation and maintenance activities, or (e) conduct any other actions with respect to Hazardous Materials required by Environmental Laws. “Rent Reserve” - on any date, the aggregate of (i) all past due rent, fees or other charges owing on such date by any Borrower to any landlord of any premises where any of the Collateral is located or to any processor, repairman, mechanic or other person who is in possession of any Collateral or has asserted any Lien or claim thereto, and (ii) a reserve equal to 3 months rent or other charges with respect to any Collateral in the possession of, or at a location owned by, a Person other than a Borrower if such Person has not duly executed and delivered to Agent a Lien Waiver. “Reportable Event” - any of the events set forth in Section 4043(b) of ERISA with respect to a Plan. “Reports” - any field examination or other audit or any appraisal prepared by or on behalf of Agent with respect to any Borrower or Collateral. “Required Lenders” - at any date of determination thereof, (a) when Initial Lenders are the only Lenders, both Initial Lenders, and (b) when Initial Lenders are not the only Lenders, Lenders having Revolver Commitments representing at least 51% of the aggregate Revolver Commitments at such time; provided, however, that if any Lender shall be in breach of any of its obligations hereunder to Borrowers or Agent, including any breach resulting from its failure to honor its Revolver Commitment in accordance with the terms of this Agreement, then, for so long as such breach continues, the term “Required Lenders” shall mean Lenders (excluding each Lender that is in breach of its obligations under this Agreement) having Revolver Commitments representing at least 51% of the aggregate Revolver Commitments (excluding the Revolver Commitments of each Lender that is in breach of its obligations under this Agreement) at such time; provided, further, however, that, for purposes of this clause (b), if all of the Revolver Commitments have been terminated, the term “Required Lenders” shall mean Lenders (excluding each Lender that is in breach of its obligations under this Agreement) holding Loans (including Swingline Loans) representing at least 51% of the aggregate principal amount of Loans (including Swingline Loans) outstanding at such time. “Restricted Investment” - any acquisition by a Borrower or any of its Subsidiaries in exchange for cash or other Property of Property, Equity Interests or Debt, or the purchase or acquisition by such Borrower or any of its Subsidiaries of Property, a loan, advance, capital 33

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contribution or subscription, except acquisitions of the following: (i) fixed assets to be used, or the maintenance or repair of fixed assets that are used, in the Ordinary Course of Business of such Borrower or any of its Subsidiaries so long as the expenditure therefor is permitted under the Approved Budget, (ii) goods held for sale or lease or to be used in the manufacture of goods or the provision of services by such Borrower or any of its Subsidiaries in the Ordinary Course of Business; (iii) Current Assets arising from the sale or lease of goods or the rendition of services in the Ordinary Course of Business of such Borrower or any of its Subsidiaries; (iv) investments in Subsidiaries to the extent existing on the Closing Date; (v) Cash Equivalents to the extent existing on the Closing Date; (vi) loans and other advances of money to the extent permitted by Section 10.2.2 and investments permitted under Section 9.2.3(ix), (vii) [reserved]; (viii) [reserved]; (ix) investments received by a Borrower in connection with the bankruptcy or reorganization of any Person (other than a Borrower), or settlement of obligations of, or other disputes with or judgments against, or foreclosure or deed in lieu of foreclosure with respect to any Lien held as security for an obligation owing by such other Person to a Borrower, in each case in the Ordinary Course of Business; (x) accounts receivable, notes receivable, security deposits and prepayments arising and trade credit granted in the Ordinary Course of Business and any investments received in satisfaction or partial satisfaction thereof from financially troubled Account Debtors and other credits to suppliers made in the Ordinary Course of Business; (xi) [reserved]; (xii) [reserved]; and (xiii) investments in the Ordinary Course of Business for the acquisition of business supplies or other non-capitalized similar assets that are used in a Borrower’s business. “Restrictive Agreement” - an agreement (other than any of the Loan Documents) that, if and for so long as a Borrower or any Subsidiary of such Borrower is a party thereto, would prohibit, condition or restrict such Borrower’s or Subsidiary’s right to incur or repay any of the Obligations; grant Liens upon any of such Borrower’s or Subsidiary’s assets in favor of Agent pursuant to the Loan Documents; declare or make Distributions; amend, modify, extend or renew any of the Loan Documents; or repay any Debt owed to another Borrower. “Revolver Commitment” - at any date for any Lender, the obligation of such Lender to make Revolver Loans and to purchase participations in LC Obligations pursuant to the terms and conditions of this Agreement, which shall not exceed the principal amount set forth opposite such Lender’s name under the heading “Revolver Commitment” on the signature pages of this Agreement or the principal amount set forth in the Assignment and Acceptance by which it became a Lender, as modified from time to time pursuant to the terms of this Agreement or to give effect to any applicable Assignment and Acceptance; and “Revolver Commitments” means the aggregate principal amount of the Revolver Commitments of all Lenders, the maximum amount of which on any date shall be $65,000,000, as reduced from time to time pursuant to Section 2.2.5. “Revolver Loan” - a loan made by Lenders as provided in Section 2.2 (including any Out-of-Formula Loan) or a Swingline Loan funded solely by WFCF. “Revolver Note” - a Revolver Note to be executed by Borrowers in favor of each Lender, to the extent such Lender requests a Revolver Note, in the form of Exhibit A attached hereto, 34

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which shall be in the face amount of such Lender’s Revolver Commitment and which shall evidence all Revolver Loans made by such Lender to Borrowers pursuant to this Agreement. “RIS” - as defined in the Recitals hereto. “S&P” - Standard & Poor’s Ratings Group, a division of McGraw-Hill, Inc. “Sale Motion” – any motion, or other pleading, seeking Bankruptcy Court approval of a Bankruptcy Sale. “Sale Procedures Order” – an order, in form and substance acceptable to Agent, Lenders, Prepetition Senior Agent, and Prepetition Senior Lenders, which order shall schedule an auction at which qualified bidders would be permitted to make offers for the Subject Assets, which auction shall be held on or before the Auction Deadline. “Sale Transaction” - a sale of all or substantially all of the Subject Assets. “Schedule of Accounts” - as defined in Section 8.2.1. “SEC” - Securities and Exchange Commission or any other similar or successor agency of the Federal government administering the Securities Act. “Secured Parties” - Agent, Issuing Bank, Lenders (including WFCF as the provider of Swingline Loans) and any Bank Product Provider. “Security Documents” - each Guaranty, the Deposit Account Control Agreements, the DIP Order, and all other instruments and agreements now or at any time hereafter securing the whole or any part of the Obligations. “Senior Officer” - the chairman of the board of directors, the president or the chief financial officer of, or in-house legal counsel to, a Borrower. “Services CA” - as defined in the Recitals hereto. “Services NY” - as defined in the Recitals hereto. “Settlement Date” - as defined in Section 4.1.3(i). “Settlement Report” - a report delivered by Agent to Lenders summarizing the amount of the outstanding Revolver Loans as of the Settlement Date and the calculation of the Borrowing Base as of such Settlement Date. “Solvent” - as to any Person, such Person (i) owns Property whose fair salable value is greater than the amount required to pay all of such Person’s debts (including contingent, subordinated, unmatured and unliquidated liabilities), (ii) owns Property whose present fair salable value (as defined below) is greater than the probable total liabilities (including contingent, subordinated, unmatured and unliquidated liabilities), of such Person as they become 35

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absolute and matured, (iii) is able to pay all of its debts as such debts mature, (iv) has capital that is not unreasonably small for its business and is sufficient to carry on its business and transactions and all business and transactions in which it is about to engage, (v) is not “insolvent” within the meaning of Section 101(32) of the Bankruptcy Code, and (vi) has not incurred (by way of assumption or otherwise) any obligations or liabilities (contingent or otherwise) under any of the Loan Documents, or made any conveyance pursuant to or in connection therewith, with actual intent to hinder, delay or defraud either present or future creditors of such Person or any of its Subsidiaries. As used herein, the term “fair salable value” of a Person’s assets means the amount that may be realized within a reasonable time, either through collection or sale of such assets at the regular market value, based upon the amount that could be obtained for such assets within such period by a capable and diligent seller from an interested buyer who is willing (but is under no compulsion) to purchase under ordinary selling conditions. “Sponsor” – Trilantic Capital Partners IV, L.P. “Stalking Horse Bid” - as defined in Section 10.1.16(i). “Stalking Horse Bidder” - as defined in Section 10.1.16(i). “Statutory Reserves” - on any date, the percentage (expressed as a decimal) established by the Board of Governors which is the then stated maximum rate for all reserves (including all basic, emergency, supplemental or other marginal reserve requirements and taking into account any transitional adjustments or other scheduled in reserve requirements) applicable to any member bank of the Federal Reserve System in respect to Eurocurrency Liabilities (or any successor category of liabilities under Regulation D). Such reserve percentage shall include those imposed pursuant to said Regulation D. The Statutory Reserve shall be adjusted automatically on and as of the effective date of any change in such percentage. “Subject Assets” means substantially all of the Borrowers’ assets. “Subordinated Debt” - Debt incurred by any Borrower or any of its Subsidiaries that is expressly subordinated and made junior in right of payment to the Full Payment of the Obligations and the Full Payment (as defined in the Prepetition Senior Loan Agreement) of the Prepetition Senior Obligations, and, to the extent that such Debt is incurred on or after the Closing Date, such Debt is payable on terms and conditions (including terms relating to interest, fees, repayment and subordination) that are reasonably satisfactory to Agent. “Subsidiary” - any Person in which more than 50% of its outstanding Equity Interests is owned directly or indirectly by Holdings, by one or more other Subsidiaries of Holdings or by Holdings and one or more other Subsidiaries. “Substantial Compliance” – means (a) with respect to the aggregate amount of expenditures shown in any Approved Budget for any four week period, an amount not to exceed 107.5% of the amount shown in the applicable Approved Budget for such period, and (b) with respect to Borrowers’ aggregate income for any four week period shown in the applicable Approved Budget, an amount not less than 92.5% of the amount shown for such period. 36

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“Swap Obligation” - with respect to any Borrower, any obligation to pay or perform under any agreement, contract or transaction that constitutes a “swap” within the meaning of section 1a(47) of the Commodity Exchange Act. “Swingline Lender” – WFCF. “Swingline Loan’ - as defined in Section 4.1.3(ii). “Taxes” - any present or future taxes, levies, imposts, duties, fees, assessments, deductions, withholdings or other charges of whatever nature, including income, receipts, excise, property, sales, use, transfer, license, payroll, withholding, social security and franchise taxes now or hereafter imposed or levied by the United States or any other Governmental Authority and all interest, penalties, additions to tax and similar liabilities with respect thereto, but excluding, (i) in the case of Agent or each Lender, taxes imposed on or measured by the net income or overall gross receipts of such Lender (including any branch profits tax or similar tax), (ii) in the case of each Lender, taxes that would not have been imposed if such Lender had complied with the requirements of Section 5.10 and (iii) in the case of any Agent or Lender, any taxes imposed under FATCA on such Agent or Lender. “Term” - as defined in Section 6.1. “Transaction” - collectively, (i) the execution, delivery and performance by each Borrower of the Loan Documents to which it is a party, the incurrence of Loans on the date of the initial credit extensions and the use of proceeds thereof and (ii) the payment of all fees and expenses in connection with the foregoing. “Transferee” - as defined in Section 14.3.3. “UCC” - the Uniform Commercial Code (or any successor statute) as adopted and in force in the State of New York or, when the laws of any other state govern the method or manner of the perfection or enforcement of any security interest in any of the Collateral, the Uniform Commercial Code (or any successor statute) of such state. “Underlying Issuer” - Wells Fargo or one of its Affiliates. “Underlying Letter of Credit” - a Letter of Credit that has been issued by an Underlying Issuer. “Undrawn Amount” - on any date with respect to a particular Letter of Credit, the total amount then available to be drawn under such Letter of Credit in Dollars. “Upstream Payment” - a payment or distribution of cash or other Property by a Subsidiary of a Borrower to such Borrower (other than Holdings), whether in repayment of Debt owed by such Subsidiary to such Borrower, as a dividend or distribution on account of such Borrower’s ownership of Equity Interests or otherwise.

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“USA PATRIOT Act” - the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, Pub. L. No. 10756, 115 Stat. 272 (2001). “Wells Fargo” - Wells Fargo Bank, National Association, a national banking association. “WFCF” – Wells Fargo Capital Finance, LLC, a Delaware limited liability company. “WFCF Indemnities” – WFCF and all of its present and future officers, directors, employees and agents. 1.2. Accounting Terms. Unless otherwise specified herein, all terms of an accounting character used in this Agreement shall be interpreted, all accounting determinations under this Agreement shall be made, and all financial statements required to be delivered under this Agreement shall be prepared in accordance with GAAP, applied on a basis consistent with the most recent audited Consolidated financial statements of Borrowers and their Subsidiaries delivered to Agent and Lenders prior to the Closing Date and using the same method for inventory valuation as used in such audited financial statements, except for any change required by GAAP (except for immaterial changes in Borrowers’ accounting practices that are consistent with GAAP). In the event of any change in GAAP (including any change in the treatment or characterization of operating leases or capital leases) that occurs after the date of this Agreement, each of Borrowers, Agent and the Required Lenders shall have the right to require either that conforming adjustments be made to any financial covenants, definitions or other provisions set forth in this Agreement that are affected by such change or that Borrowers report their financial condition, and calculate any financial covenant or utilization of any so-called “basket” set forth in this Agreement or any other Loan Document, based on GAAP as in effect immediately prior to the occurrence of such change. 1.3. Other Terms. All other terms contained in this Agreement shall have, when the context so indicates, the meanings provided for by the UCC to the extent the same are used or defined therein. Without limiting the generality of the foregoing, the following terms shall have the meaning ascribed to them in the UCC: Account, Chattel Paper, Commercial Tort Claim, Deposit Account, Document, Electronic Chattel Paper, Equipment, Fixtures, Goods, Instrument, Inventory, Investment Property, Letter-of-Credit Right, Payment Intangible, Securities Account, Software and Supporting Obligation. 1.4. Certain Matters of Construction. The terms “herein,” “hereof” and “hereunder” and other words of similar import refer to this Agreement as a whole and not to any particular section, paragraph or subdivision. Any pronoun used shall be deemed to cover all genders. 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.” The section titles, table of contents and list of exhibits appear as a matter of convenience only and shall not affect the interpretation of this Agreement. All references to statutes and related regulations shall include all related rules and implementing regulations and any amendments of same and any successor statutes, rules and regulations; to any agreement, instrument or other documents (including any of the Loan Documents) shall include any and all 38

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modifications, amendments and supplements thereto and any and all restatements, extensions or renewals thereof to the extent such modifications, amendments, supplements, restatements, extensions or renewals of any such documents are permitted by the terms thereof; to any Person (including Agent, a Borrower, a Lender or WFCF) shall mean and include the successors and permitted assigns of such Person; to “including” and “include” shall be understood to mean “including, without limitation” (and, for purposes of each Loan Document, the parties agree that the rule of ejusdem generis shall not be applicable to limit a general statement, which is followed by or referable to an enumeration of specific matters to matters similar to the matters specifically mentioned); to the time of day shall mean the time of day on the day in question in New York City, New York, unless otherwise expressly provided in this Agreement; or to the “discretion” of Agent or a Lender shall mean the sole and absolute discretion of such Person. All Loans shall be funded in Dollars and all Obligations shall be repaid in Dollars. Whenever the phrase “to the best of Borrowers’ knowledge” or words of similar import relating to the knowledge or the awareness of a Borrower are used in this Agreement or other Loan Documents, such phrase shall mean and refer to (i) the actual knowledge of a Senior Officer of any Borrower or (ii) the knowledge that a Senior Officer of a Borrower would have obtained if they had engaged in good faith and diligent performance of his duties, including the making of such reasonably specific inquiries as may be necessary of the employees or agents of a Borrower and a good faith attempt to ascertain the existence or accuracy of the matter to which such phrase relates. 1.5. Release. Borrowers, each in their own right and with respect to the Borrowers, on behalf of their bankruptcy estates, and on behalf of all their successors, assigns, Subsidiaries and any Affiliates and any Person acting for and on behalf of, or claiming through them, (collectively, the “Releasing Parties”), hereby fully, finally and forever release and discharge (the “Release”)_Agent, Lenders, Prepetition Senior Agent, and any of the Prepetition Senior Secured Parties and all of Agent’s and Lenders’ past and present officers, directors, servants, agents, attorneys, assigns, heirs, parents, subsidiaries, and each Person acting for or on behalf of any of them (collectively, the “Released Parties”) of and from any and all past and present actions, causes of action, demands, suits, claims, liabilities, Liens, lawsuits, adverse consequences, amounts paid in settlement, costs, damages, debts, deficiencies, diminution in value, disbursements, expenses, offset, recoupment, losses, other obligations of any kind or nature whatsoever, and any other affirmative relief that can be asserted to reduce or eliminate all of any part of the Borrowers’ or their Subsidiaries’ liability to repay Agent, any Lender, Prepetition Agent, or any Prepetition Secured Party, whether in law, equity or otherwise (including, without limitation, those arising under Sections 541 through 550 of the Bankruptcy Code and interest or other carrying costs, penalties, legal, accounting and other professional fees and expenses, and incidental, consequential and punitive damages payable to third parties), (each of the foregoing, a “Company Claim”) whether known or unknown, fixed or contingent, direct, indirect, or derivative, asserted or unasserted, foreseen or unforeseen, suspected or unsuspected, now existing, heretofore existing or which may heretofore accrue against any of the Released Parties, whether held in a personal or representative capacity, and which are based on any act, fact, event or omission or other matter, cause or thing occurring at or from any time prior to and up to and including the date hereof in any way, directly or indirectly arising out of, connected with or relating to this Agreement, the Interim Order, the Final Order and the transactions contemplated hereby, and all other agreements, certificates, instruments and other documents and statements (whether written or oral) related to any of the foregoing, provided that for the 39

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avoidance of doubt the Release shall only apply in respect of past or present Company Claims and shall not apply or be granted in respect of any Company Claim that may arise after the date hereof. 1.6.

Super Priority Nature of Obligations and Agent’s and Lenders’ Liens.

1.6.1. The priority of Agent’s and Lenders’ claims against, and Liens on and in the Collateral of, the Borrowers shall be set forth in the DIP Order. 1.6.2. All Obligations shall, pursuant to the DIP Order, constitute administrative expenses of the Borrowers in the Chapter 11 Cases, with administrative priority and senior secured status under Sections 364(c) and 364(d) of the Bankruptcy Code. Subject to the Carve-Out, such administrative claim shall have priority over all other costs and expenses of the kinds specified in, or ordered pursuant to, Sections 105, 326, 328, 330, 331, 503(b), 506(c), 507(a), 507(b), 546(c), 726, 1114 or any other provision of the Bankruptcy Code or otherwise, and shall at all times be senior to the rights of the Borrowers, the Borrowers’ estates, and any successor trustee or estate representative in the Chapter 11 Cases or any subsequent proceeding or case under the Bankruptcy Code. Pursuant to, and to the extent provided in, the DIP Order, the Liens granted to Agent and Lenders on and in the Collateral of the Borrowers, and the priorities accorded to the Obligations shall have the priority and senior secured status afforded by Sections 364(c) and 364(d)(l) of the Bankruptcy Code senior to all claims and interests other than the Carve-Out and Permitted Senior Liens. 1.6.3. Pursuant to, and to the extent provided in, the DIP Order, Agent’s Liens on and in the Collateral of the Borrowers and Agent’s and Lenders’ respective administrative claims under Sections 364(c)(l) and 364(d) of the Bankruptcy Code afforded the Obligations shall also have priority over any claims arising under Section 506(c) of the Bankruptcy Code subject and subordinate only to the Carve-Out and Permitted Senior Liens. Except as set forth herein or in the DIP Order, no other claim having a priority superior or pari passu to that granted to Agent and Lenders by the DIP Order shall be granted or approved while any Obligations under this Agreement remain outstanding. Except for the Carve-Out, no costs or expenses of administration shall be imposed against Agent, Lenders or any of their Collateral or against any of the Prepetition Senior Agent and Prepetition Senior Secured Parties under the Prepetition Senior Loan Agreement or their Collateral (as defined in the Prepetition Senior Loan Agreement) under Sections 105, 506(c) or 552 of the Bankruptcy Code, or otherwise, and each of the Borrowers hereby waives for itself and on behalf of its estate in bankruptcy, any and all rights under sections 105, 506(c) or 552, or otherwise, to assert or impose or seek to assert or impose, any such costs or expenses of administration against Agent or the Lenders or against the Prepetition Senior Agent or the Prepetition Senior Secured Parties under the Prepetition Senior Credit Agreement. 1.7. Payment of Obligations. Pursuant to, and to the extent provided in, the DIP Order, upon the maturity (whether by acceleration or otherwise) of any of the Obligations under this Agreement or any of the other Loan Documents, the Secured Parties shall be entitled to immediate payment of such Obligations without further application to or order of the Bankruptcy Court. 40

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1.8. No Discharge; Survival of Claims. Borrowers agree that (a) the Obligations hereunder shall not be discharged by the entry of an order confirming a plan of reorganization in any Chapter 11 Case (and the Borrowers pursuant to Section 1141(d)(4) of the Bankruptcy Code, hereby waive any such discharge) and (ii) the superpriority administrative claim granted to Agent and Lenders pursuant to the DIP Order and described in Section 1.6 and the Liens granted to Agent pursuant to the Interim Order and Final Order and described in Section 1.6 shall not be affected in any manner by the entry of an order confirming a plan of reorganization in any Chapter 11 Case, unless in each case, such plan of reorganization provides for Full Payment (as defined in this Agreement as to the Obligations, and as defined in the Prepetition Senior Loan Agreement as to the Prepetition Senior Obligations) in cash of the Obligations and the Prepetition Senior Obligations and termination of related lending commitments on the effective date of such plan or reorganization. 1.9. Waiver of any Priming Rights. Upon the Closing Date, and on behalf of themselves and their estates, and for so long as any Obligations and Prepetition Senior Obligations shall be outstanding, without limiting any terms or conditions of the DIP Order, the Borrowers hereby irrevocably waive any right, (i) to grant or impose, or request that the Bankruptcy Court grant or impose, under section 364 of the Bankruptcy Code or otherwise, liens on or security interests in any of the collateral securing the Obligations or Prepetition Senior Obligations, which are pari passu with, equal to or superior to the liens and security interests held by Agent or Prepetition Senior Agent; (ii) to grant or impose, or request that the Bankruptcy Court grant or impose, under section 364 of the Bankruptcy Code or otherwise, claims or expenses against any Borrower, which are pari passu with, equal to or superior to the Obligations or adequate protection claims of the Prepetition Senior Agent or Prepetition Senior Secured Parties; and (iii) to use, or to request that the Bankruptcy Court authorize the use of, Cash Collateral (as defined in the DIP Order) or proceeds of Loans, except for such consensual uses expressly provided under the DIP Order. SECTION 2.

CREDIT FACILITIES

2.1. Commitments. Subject to the terms and conditions of, and in reliance upon the representations and warranties made in, this Agreement and the other Loan Documents, Lenders severally agree to the extent and in the manner hereinafter set forth to make their respective shares of the Revolver Commitments available to Borrowers, in an aggregate amount up to $65,000,000 (less the outstanding Net Prepetition Senior Obligations as of the date of any Borrowing hereunder), as set forth herein below. 2.2.

Revolver Commitments.

2.2.1. Revolver Loans. Subject to the terms and conditions set forth herein and the DIP Order, each Lender agrees, severally to the extent of its Revolver Commitment and not jointly with the other Lenders, upon the terms and subject to the conditions set forth herein, to make Revolver Loans to Borrowers on any Business Day during the period from the Closing Date through the Business Day before the last day of the Term, not to exceed in aggregate principal amount outstanding at any time such Lenderâ&#x20AC;&#x2122;s Revolver Commitment at such time, which Revolver Loans may be repaid and reborrowed in accordance with the provisions of this 41

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Agreement; provided, however, that, except as otherwise provided in Section 13.9.4, Lenders shall have no obligation to Borrowers whatsoever to honor any request for a Revolver Loan (i) on or after the Commitment Termination Date, (ii) if at the time of the proposed funding thereof the aggregate principal amount of all of the Revolver Loans then outstanding and Pending Revolver Loans exceeds, or would exceed after the funding of such Revolver Loan, Availability, or (iii) to the extent that such Revolver Loan would cause the Borrower to exceed the budgeted amount for the period during which such Revolver Loan would be made as set forth in the Approved Budget (after giving effect to the Permitted Variances). Each Borrowing of Revolver Loans shall be funded by Lenders on a Pro Rata basis in accordance with their respective Revolver Commitments (except for WFCF with respect to Swingline Loans). The Revolver Loans shall bear interest as set forth in Section 3.1 hereof. Each Revolver Loan shall consist entirely of Base Rate Loans. 2.2.2. Out-of-Formula Loans. If the unpaid balance of Revolver Loans outstanding at any time should exceed the Borrowing Base at such time (an â&#x20AC;&#x153;Out-of-Formula Conditionâ&#x20AC;?), such Revolver Loans shall nevertheless constitute Obligations that are secured by the Collateral and entitled to all of the benefits of the Loan Documents. In the event that Lenders are willing in their sole and absolute discretion to make Out-of-Formula Loans or are required to do so by Section 13.9.4 hereof, such Out-of-Formula Loans shall be payable on demand (which demand shall be made by Agent in its discretion or at the request of the Required Lenders) and shall bear interest as provided in Section 3.1.5. 2.2.3. Use of Proceeds. The proceeds of the Revolver Loans shall be used by Borrowers solely for one or more of the following purposes: (i) to make adequate protection payments with respect to the Prepetition Senior Obligations and Prepetition Junior Obligations in accordance with the DIP Order; (ii) to pay the fees and transaction expenses associated with the closing of the transactions described in this Agreement; (iii) to pay any of the Obligations in accordance with this Agreement; and (iv) to fund the Chapter 11 Cases in accordance with the Approved Budget (subject to Permitted Variances) and to make expenditures for the ongoing working capital requirements of Borrowers and their Subsidiaries and for other general corporate purposes of Borrowers and their Subsidiaries to the extent such expenditures are not prohibited by this Agreement or Applicable Law. In no event may any Revolver Loan proceeds be used by any Borrower (x) to purchase or to carry, or to reduce, retire or refinance any Debt incurred to purchase or carry, any Margin Stock or for any related purpose that violates the provisions of Regulations T, U or X of the Board of Governors or (y) to fund any operations or finance any investments or activities in, or to make payments to, a Blocked Person. Except as provided in the DIP Order, no proceeds of any Revolver Loan may be utilized by Borrowers to finance in any way any professional fees, disbursements, costs or expenses incurred in connection with asserting, investigating, or preparing for any claims or causes of action against the Prepetition Senior Agent or any of the Prepetition Senior Secured Parties under the Prepetition Senior Loan Agreement or the other Prepetition Senior Loan Documents or any of their counsel or advisors (including advisors to their counsel) and/or investigating, challenging or raising any defenses to the Prepetition Senior Obligations or any Liens under or in connection with the Prepetition Senior Loan Agreement or any Prepetition Senior Loan Document. 2.2.4. 42

[Reserved.]

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2.2.5.

[Reserved.]

2.2.6.

[Reserved.]

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LC Facility.

2.3.1. Issuance of Letters of Credit. Subject to all of the terms and conditions hereof, Issuing Bank agrees to establish the LC Facility pursuant to which, during the period from the date hereof to (but excluding) the 30th day prior to the last day of the Term, upon the request of Borrower Agent made in accordance herewith, Issuing Bank agrees to issue, or to cause an Underlying Issuer (including, as Issuing Bank’s agent) to issue, a requested Letter of Credit. If Issuing Bank, at its option, elects to cause an Underlying Issuer to issue a requested Letter of Credit, then Issuing Bank agrees that it will enter into arrangements relative to the reimbursement of such Underlying Issuer (which may include, among, other means, by becoming an applicant with respect to such Letter of Credit or entering into undertakings which provide for reimbursements of such Underlying Issuer with respect to such Letter of Credit; each such obligation or undertaking, irrespective of whether in writing, a “Reimbursement Undertaking”) with respect to Letters of Credit issued by such Underlying Issuer. By submitting a request to Issuing Bank for the issuance of a Letter of Credit, Borrower Agent shall be deemed to have requested that Issuing Bank issue or that an Underlying Issuer issue the requested Letter of Credit and to have requested Issuing Bank to issue a Reimbursement Undertaking with respect to such requested Letter of Credit if it is to be issued by an Underlying Issuer (it being expressly acknowledged and agreed by each Borrower that Borrowers are and shall be deemed to be applicants (within the meaning of Section 5-102(a)(2) of the UCC) with respect to each Underlying Letter of Credit). (i) Each Borrower acknowledges that Issuing Bank’s willingness to issue or cause the issuance of any Letter of Credit or to issue a Reimbursement Undertaking in respect of an Underlying Letter of Credit is conditioned upon Issuing Bank’s receipt of (A) an LC Application with respect to the requested Letter of Credit and (B) such other instruments and agreements as Issuing Bank or Underlying Issuer may customarily require for the issuance of a letter of credit of equivalent type and amount as the requested Letter of Credit. Issuing Bank shall have no obligation to issue or cause the issuance of any Letter of Credit or to issue a Reimbursement Undertaking in respect of an Underlying Letter of Credit unless (x) Issuing Bank receives an LC Request and LC Application at least 5 Business Days (or such shorter period as may be acceptable to Issuing Bank) prior to the date of issuance of a Letter of Credit, and (y) each of the LC Conditions is satisfied on the date of Issuing Bank’s receipt of the LC Request and at the time of the requested issuance of a Letter of Credit. (ii) Letters of Credit may be requested by a Borrower only if they are to be used (a) to support obligations of a Borrower that are not prohibited under this Agreement or (b) for such other purposes as Agent and Lenders may approve from time to time in writing.

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(iii) Borrowers shall comply with all of the terms and conditions imposed on Borrowers by Issuing Bank that are contained in any LC Application or in any other agreement customarily or reasonably required by Issuing Bank or Underlying Issuer in connection with the issuance of any Letter of Credit or the issuance of any Reimbursement Undertaking in respect of an Underlying Letter of Credit, provided, that, the terms of this Agreement shall control in the case of any inconsistency between any LC Application and this Agreement. If Issuing Bank shall honor any request for payment under a Letter of Credit or Underlying Issuer shall honor any request for payment under an Underlying Letter of Credit, Borrowers shall be jointly and severally obligated to pay to Issuing Bank, in Dollars on the same day as the date on which payment was made by Issuing Bank or Underlying Issuer (each a â&#x20AC;&#x153;Reimbursement Dateâ&#x20AC;?), an amount equal to the amount paid by Issuing Bank under such Letter of Credit or the Underlying Issuer under such Underlying Letter of Credit, together with interest from and after the Reimbursement Date until Full Payment is made by Borrowers at the Default Rate for Revolver Loans constituting Base Rate Loans. Until Issuing Bank has received payment from Borrowers in accordance with the foregoing provisions of this clause (iii), Issuing Bank, in addition to all of its other rights and remedies under this Agreement and any LC Application, shall be fully subrogated to the rights and remedies of each beneficiary under such Letter of Credit whose claims against Borrowers have been discharged with the proceeds of such Letter of Credit. Whether or not a Borrower submits any Notice of Borrowing to Agent, Borrowers shall be deemed to have requested from Lenders a Borrowing of Base Rate Loans in an amount necessary to pay to Issuing Bank all amounts due Issuing Bank or Underlying Issuer on any Reimbursement Date and each Lender agrees to fund its Pro Rata share of such Borrowing whether or not any Default or Event of Default has occurred or exists, the Revolver Commitments have been terminated, the funding of the Borrowing would result in (or increase the amount of) any Out-of-Formula Condition, or any of the conditions set forth in Section 11 are not satisfied.

(iv) Borrowers assume all risks of the acts, omissions or misuses of any Letter of Credit by the beneficiary thereof. The obligation of Borrowers to reimburse Issuing Bank and the Underlying Issuer for any payment made by Issuing Bank or the Underlying Issuer under a Letter of Credit shall be absolute, unconditional, irrevocable and joint and several and shall be paid without regard to any lack of validity or enforceability of any Letter of Credit or the existence of any claim, setoff, defense or other right which Borrowers may have at any time against a beneficiary of any Letter of Credit. In connection with the issuance of any Letter of Credit, none of Agent, Issuing Bank, Underlying Issuer or any Lender shall be responsible for the existence, character, quality, quantity, condition, packing, value or delivery of any goods purported to be represented by any Documents; any differences or variation in the character, quality, quantity, condition, packing, value or delivery of any goods from that expressed in the Documents; the form, validity, sufficiency, accuracy, genuineness or legal effect of any Documents or of any endorsements thereon, even if such Documents should in fact prove to be in any or all respects invalid, insufficient, fraudulent or forged; the time, place, manner or order in which shipment of goods is made; partial or incomplete shipment of, or failure or omission to ship, any or all of the goods referred to in a Letter of Credit or

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Documents applicable thereto; any deviation from instructions, delay, default or fraud by the shipper and/or any Person in connection with any goods or any shipping or delivery thereof; any breach of contract between the shipper or vendors and a Borrower; errors, omissions, interruptions or delays in transmission or delivery of any messages, by mail, cable, telegraph, telex or otherwise, whether or not they be in cipher, unless such errors, omissions, interruptions or delays are the result of the gross negligence or willful misconduct of Issuing Bank; errors in interpretation of technical terms; the misapplication by the beneficiary of any Letter of Credit of the proceeds of any drawing under such Letter of Credit; or any consequences arising from causes beyond the control of Issuing Bank, Underlying Issuer, Agent, or any Lender, including any act or omission (whether rightful or wrongful) of any present or future Governmental Authority. The rights, remedies, powers and privileges of Issuing Bank under this Agreement with respect to Letters of Credit shall be in addition to, and cumulative with, all rights, remedies, powers and privileges of Issuing Bank under any of the LC Documents. Nothing herein shall be deemed to release Issuing Bank from any liability or obligation that it may have in respect to any Letter of Credit arising out of and directly resulting from its own gross negligence or willful misconduct. (v) No Letter of Credit shall be extended or amended in any respect that is not solely ministerial, unless all of the LC Conditions are met as though a new Letter of Credit were being requested and issued. With respect to any Letter of Credit that contains any â&#x20AC;&#x153;evergreenâ&#x20AC;? or automatic renewal provision, each Lender shall be deemed to have consented to any such extension or renewal, unless any such Lender shall have provided to Agent written notice that it declines to consent to any such extension or renewal at least 30 days prior to the date on which Issuing Bank is entitled to decline to extend or renew the Letter of Credit; provided, that, if all of the LC Conditions are met and no Default or Event of Default exists, each Lender shall be deemed to have consented to any such extension or renewal. (vi) Unless otherwise provided in any of the LC Documents, each LC Application and each standby Letter of Credit shall be subject to the Uniform Customs and Practice for Documentary Credits, International Chamber of Commerce No. 600, and any amendments or revisions thereto. (vii) Each Borrower acknowledges and agrees that any and all issuance charges, usage charges, commissions, fees, and costs incurred by Issuing Bank relating to Underlying Letters of Credit shall be Obligations for purposes of this Agreement and shall be reimbursable immediately by Borrowers to Agent for the account of Issuing Bank; it being acknowledged and agreed by Borrowers that, as of the Closing Date, the usage charge imposed by the Underlying Issuer is 0.25% per annum times the undrawn amount of each Underlying Letter of Credit, that such usage charge may be changed from time to time, and that the Underlying Issuer also imposes a schedule of charges for amendments, extensions, drawings, and renewals.

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Participations.

(i) Immediately upon the issuance of any Letter of Credit or Reimbursement Undertaking, each Lender shall be deemed to have irrevocably and unconditionally purchased and received from Issuing Bank, without recourse or warranty, an undivided interest and participation equal to the Pro Rata share of such Lender (a “Participating Lender”) in all LC Obligations arising in connection with such Letter of Credit, but in no event greater than an amount which, when added to such Lender’s Pro Rata share of all Revolver Loans and LC Obligations then outstanding, exceeds such Lender’s Revolver Commitment; provided, however, that if Issuing Bank shall have received written notice from a Lender on or before the Business Day immediately prior to the date of Issuing Bank’s issuance issue of a Letter of Credit that one or more of the conditions set forth in Section 11 or Section 2.4.1 has not been satisfied, Issuing Bank shall have no obligation to issue (and shall not issue) the requested Letter of Credit, Reimbursement Undertaking or any other Letter of Credit until such notice is withdrawn in writing by that Lender or until the Required Lenders shall have effectively waived such condition in accordance with this Agreement. In no event shall Issuing Bank be deemed to have notice or knowledge of any existence of any Default or Event of Default or the failure of any conditions in Sections 11 or 2.4.1 to be satisfied prior to its receipt of such notice from a Lender. (ii) If Issuing Bank makes any payment under a Letter of Credit or Reimbursement Undertaking and Borrowers do not repay or cause to be repaid the amount of such payment on the Reimbursement Date, Issuing Bank shall promptly notify Agent, which shall promptly notify each Participating Lender, of such payment and each Participating Lender shall promptly (and in any event within 1 Business Day after its receipt of notice from Agent) and unconditionally pay to Agent, for the account of Issuing Bank, in immediately available funds, the amount of such Participating Lender’s Pro Rata share of such payment, and Agent shall promptly pay such amounts to Issuing Bank. If a Participating Lender does not make its Pro Rata share of the amount of such payment available to Agent on a timely basis as herein provided, such Participating Lender agrees to pay to Agent for the account of Issuing Bank, forthwith on demand, such amount together with interest thereon at the Federal Funds Rate until paid. The failure of any Participating Lender to make available to Agent for the account of Issuing Bank such Participating Lender’s Pro Rata share of the LC Obligations shall not relieve any other Participating Lender of its obligation hereunder to make available to Agent its Pro Rata share of the LC Obligations. No Participating Lender shall be responsible for the failure of any other Participating Lender to make available to Agent its Pro Rata share of the LC Obligations on the date such payment is to be made. (iii) Whenever Issuing Bank receives a payment on account of the LC Obligations, including any interest thereon, as to which Agent has previously received payments from any Participating Lender for the account of Issuing Bank, Issuing Bank shall promptly pay to each Participating Lender which has funded its participating interest therein, in immediately available funds, an amount equal to such Participating Lender’s Pro Rata share thereof. 46

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(iv) The obligation of each Participating Lender to make payments to Agent for the account of Issuing Bank in connection with Issuing Bankâ&#x20AC;&#x2122;s payment under a Letter of Credit shall be absolute, unconditional and irrevocable, not subject to any counterclaim, setoff, qualification or exception whatsoever, and shall be made in accordance with the terms and conditions of this Agreement under all circumstances and irrespective of whether or not Borrowers may assert or have any claim for any lack of validity or unenforceability of this Agreement or any of the other Loan Documents; the existence of any Default or Event of Default; any draft, certificate or other document presented under a Letter of Credit having been determined to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect; the existence of any setoff or defense any Borrower may have with respect to any of the Obligations; or the termination of the Revolver Commitments. (v) Neither Issuing Bank, nor the Underlying Issuer, nor any of their officers, directors, employees or agents shall be liable to any Participating Lender for any action taken or omitted to be taken under or in connection with any of the LC Documents except as a result of actual gross negligence or willful misconduct on the part of Issuing Bank or the Underlying Issuer. Neither Issuing Bank nor the Underlying Issuer assumes any responsibility for any failure or delay in performance or breach by a Borrower or any other Person of its obligations under any of the LC Documents. Neither Issuing Bank nor the Underlying Issuer makes to Participating Lenders any express or implied warranty, representation or guaranty with respect to the Collateral, the LC Documents, or any Borrower. Neither Issuing Bank nor the Underlying Issuer shall be responsible to any Participating Lender for any recitals, statements, information, representations or warranties contained in, or for the execution, validity, genuineness, effectiveness or enforceability of or any of the LC Documents; the validity, genuineness, enforceability, collectibility, value or sufficiency of any of the Collateral or the perfection of any Lien therein; or the assets, liabilities, financial condition, results of operations, business, creditworthiness or legal status of any Borrower or any Account Debtor. In connection with its administration of and enforcement of rights or remedies under any of the LC Documents, each of Issuing Bank and the Underlying Issuer shall be entitled to act, and shall be fully protected in acting upon, any certification, notice or other communication in whatever form believed by Issuing Bank or the Underlying Issuer, in good faith, to be genuine and correct and to have been signed, sent or made by a proper Person. Issuing Bank and the Underlying Issuer may consult with and employ legal counsel, accountants and other experts and to advise it concerning its rights, powers and privileges under the LC Documents and shall be entitled to act upon, and shall be fully protected in any action taken in good faith reliance upon, any advice given by such experts. Issuing Bank and the Underlying Issuer may employ agents and attorneys-in-fact in connection with any matter relating to the LC Documents and shall not be liable for the negligence, default or misconduct of any such agents or attorneys-in-fact selected by Issuing Bank or the Underlying Issuer with reasonable care. Neither Issuing Bank nor the Underlying Issuer shall have any liability to any Participating Lender by reason of Issuing Bankâ&#x20AC;&#x2122;s or Underlying Issuerâ&#x20AC;&#x2122;s refraining to take any action under any of the LC Documents without having first received written instructions from the Required Lenders to take such action. 47

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(vi) Upon the request of any Participating Lender, Issuing Bank shall furnish to such Participating Lender copies (to the extent then available to Issuing Bank) of each outstanding Letter of Credit and related LC Documents as may be in the possession of Issuing Bank and reasonably requested from time to time by such Participating Lender. 2.3.3. Cash Collateral Account. If any LC Obligations, whether or not then due or payable, shall for any reason be outstanding (i) at any time that an Event of Default exists, (ii) on any date that Availability is less than zero, (iii) on or at any time after the Commitment Termination Date, or (iv) on the day that is 5 days prior to the last day of the Term, then Borrowers shall, on Issuing Bank’s or Agent’s request, forthwith pay to Issuing Bank the amount of any LC Obligations that are then due and payable and shall, upon the occurrence of any of the events described in clauses (i), (iii) and (iv) hereinabove, Cash Collateralize all outstanding Letters of Credit. If notwithstanding the occurrence of one or more of the events described in clauses (i), (iii) and (iv) in the immediately preceding sentence Borrowers fail to Cash Collateralize any outstanding Letters of Credit on the first Business Day following Agent’s or Issuing Bank’s demand therefor, Lenders may (and shall upon direction of Agent) advance such amount as Revolver Loans (whether or not the Commitment Termination Date has occurred or an Out-of-Formula Condition is created thereby). Such cash (together with any interest accrued thereon) shall be held by Agent in the Cash Collateral Account and may be invested, in Agent’s discretion, in Cash Equivalents. Each Borrower hereby pledges to Agent and grants to Agent a security interest in, for the benefit of Agent in such capacity and for the Pro Rata benefit of Lenders, all Cash Collateral held in the Cash Collateral Account from time to time and all proceeds thereof, as security for the payment of all Obligations (including LC Obligations), whether or not then due or payable. From time to time after cash is deposited in the Cash Collateral Account, Agent may apply Cash Collateral then held in the Cash Collateral Account to the payment of any amounts, in such order as Agent may elect, as shall be or shall become due and payable by Borrowers to Issuing Bank, Agent or any Lender with respect to the LC Obligations. Neither Borrowers nor any other Person claiming by, through or under or on behalf of Borrowers shall have any right to withdraw any of the Cash Collateral held in the Cash Collateral Account, including any accrued interest, provided, that, upon termination or expiration of all Letters of Credit and the payment and satisfaction of all of the LC Obligations, any Cash Collateral remaining in the Cash Collateral Account shall be returned to Borrowers unless an Event of Default then exists (in which event Agent may apply such Cash Collateral to the payment of any other Obligations outstanding in accordance with the provisions of Section 5.6, with any surplus to be turned over to Borrowers). 2.3.4.

Indemnifications.

(i) In addition to and without limiting any other indemnity which Borrowers may have to any Indemnitees under any of the Loan Documents, each Borrower hereby agrees to indemnify and defend each of the Indemnitees and to hold each of the Indemnitees harmless from and against any and all Claims which any Indemnitee may suffer, incur or be subject to as a consequence, directly or indirectly, of (a) the issuance of, payment or failure to pay or any performance or failure to perform under any Letter of Credit, (b) any suit, investigation or proceeding as to which Agent or 48

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any Lender is or may become a party to as a consequence, directly or indirectly, of the issuance of any Letter of Credit or Reimbursement Undertaking or the payment or failure to pay thereunder or (c) Issuing Bank or Underlying Issuer following any instructions of a Borrower with respect to any Letter of Credit or any Document received by Issuing Bank or Underlying Issuer with reference to any Letter of Credit, except such indemnification shall not apply to an Indemnitee to the extent determined by a final and nonappealable judgment of a court of competent jurisdiction to have resulted from the gross negligence or willful misconduct (including fraud) of such Indemnitee (and such Indemnitee shall not be entitled to indemnification from a Borrower for the costs incurred by such Indemnitee arising from such proceeding). For purposes of this Section 2.3.4, “Indemnitees” shall not include the Co-Collateral Agent. (ii) Each Participating Lender agrees to indemnify and defend each Issuing Bank Indemnitee (to the extent such Issuing Bank Indemnitee is not reimbursed by Borrowers, but without limiting the indemnification obligations of Borrowers under this Agreement), to the extent of such Lender’s Pro Rata share of the Revolver Commitments, from and against any and all Claims which may be imposed on, incurred by or asserted against any Issuing Bank Indemnitee in any way related to or arising out of Issuing Bank’s (or the Underlying Issuer’s) administration or enforcement of rights or remedies under any of the LC Documents or any of the transactions contemplated thereby (including costs and expenses which Borrowers are obligated to pay under Section 15.2). 2.4. Bank Products. Borrowers may request any Bank Product Provider to provide, or to arrange for one or more of its Affiliates to provide, Bank Products, but no Bank Product Provider shall have any obligation whatsoever to provide, or to arrange for the provision of, any Bank Products. Borrowers agree to indemnify and hold Agent and Lenders harmless from and against any and all Claims at any time incurred by Agent or any Lenders that arise from any indemnity given to any Bank Product Provider that relate to such Bank Products. Borrowers acknowledge that obtaining Bank Products from any Bank Product Provider is in the discretion of such Bank Product Provider and is subject to all rules and regulations of such Bank Product Provider that are applicable to such Bank Products. SECTION 3. 3.1.

INTEREST, FEES AND CHARGES Interest.

3.1.1. Rates of Interest. Borrowers agree to pay interest in respect of all unpaid principal amounts of the Revolver Loans from the respective dates such principal amounts are advanced until paid (whether at stated maturity, on acceleration or otherwise) at a rate per annum equal to the Applicable Margin plus the Base Rate in effect from time to time.

3.1.2.

[Reserved].

3.1.3.

[Reserved]

3.1.4.

[Reserved]

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3.1.5. Default Rate of Interest. Borrowers shall pay interest at a rate per annum equal to the Default Rate (i) with respect to the principal amount of any portion of the Obligations (and, to the extent permitted by Applicable Law, all past due interest) that is not paid on the due date thereof (whether due at stated maturity, on demand, upon acceleration or otherwise) until Full Payment; (ii) with respect to the principal amount of all of the Obligations (and, to the extent permitted by Applicable Law, all past due interest) upon the earlier to occur of (x) Borrower Agent’s receipt of notice from Agent of the Required Lenders’ election to charge the Default Rate based upon the existence of any Event of Default (which notice Agent shall send only with the consent or at the direction of the Required Lenders), whether or not acceleration or demand for payment of the Obligations has been made (provided that the Default Rate shall be applicable until waived in writing in accordance with the terms hereof), or (y) the commencement by or against any Borrower of an Insolvency Proceeding whether or not under the circumstances described in clauses (i) or (ii) hereof Lenders elect to accelerate the maturity or demand payment of any of the Obligations; and (iii) with respect to the principal amount of any Out-of-Formula Loans (unless otherwise agreed in writing by the Required Lenders), whether or not demand for payment thereof has been made by Agent. To the fullest extent permitted by Applicable Law, the Default Rate shall apply and accrue on any judgment entered with respect to any of the Obligations and to the unpaid principal amount of the Obligations during any Insolvency Proceeding of a Borrower. Each Borrower acknowledges that the cost and expense to Agent and each Lender attendant upon the occurrence of an Event of Default are difficult to ascertain or estimate and that the Default Rate is a fair and reasonable estimate to compensate Agent and Lenders for such added cost and expense. Interest accrued at the Default Rate shall be due and payable on demand. 3.2. Fees. In consideration of Lenders’ establishment of the Revolver Commitments in favor of Borrowers, and Agent’s agreement to serve as collateral and administrative agent hereunder, Borrowers jointly and severally agree to pay the following fees: 3.2.1.

[Reserved].

3.2.2. Unused Line Fee. Borrowers shall be jointly and severally obligated to pay to Agent, for the Pro Rata benefit of Lenders, a fee equal to 0.50% per annum of the amount by which the Average Revolver Loan Balance for any calendar month (or portion thereof that the Revolver Commitments are in effect) is less than the aggregate amount of the Revolver Commitments, such fee to be paid monthly in arrears on the first Business Day of the following calendar month; but if the Revolver Commitments are terminated on a day other than the first Business Day of a calendar month, then any such fee payable for the calendar month in which termination shall occur shall be paid on the effective date of such termination. 3.2.3. LC Facility Fees. Borrowers shall be jointly and severally obligated to pay: (i) to Agent for the Pro Rata account of each Lender for all Letters of Credit, the Applicable Margin on a per annum basis based on the average amount available to be drawn under Letters of Credit outstanding and all Letters of Credit that are paid or expire during the period of measurement, payable in cash monthly, in arrears, on the first Business Day of the following calendar month; and (ii) to Issuing Bank for its own account all customary charges associated with the issuance, amending, negotiating, payment, processing and administration of all Letters 50

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of Credit. All Letter of Credit fees that are expressed as a percentage shall be increased to a percentage that is 2% greater than the percentage that would otherwise be applicable to Revolver Loans when the Default Rate is in effect. 3.2.4. Audit and Appraisal Fees and Expenses. Borrowers shall pay to Agent, reasonable and documented field examination, appraisal, and valuation fees and charges, as and when incurred or chargeable, as follows (i) a fee of $1,000 per day, per examiner, plus out-ofpocket expenses (including travel, meals, and lodging) for each field examination of any Borrower performed by personnel employed by Agent, and (ii) the fees or charges paid or incurred by Agent (but, in any event, no less than a charge of $1,000 per day, per Person, plus out-of-pocket expenses (including travel, meals, and lodging)) if it elects to employ the services of one or more third Persons to perform field examinations of any Borrower or its Subsidiaries, to establish electronic collateral reporting systems, to appraise the Collateral, or any portion thereof, or to assess any Borrowerâ&#x20AC;&#x2122;s or its Subsidiaries' business valuation. The foregoing shall not be construed to limit Agentâ&#x20AC;&#x2122;s right to conduct audits and appraisals of the Collateral as provided in Section 10.1.1. 3.2.5. Other Fees. In addition to the other fees provided for herein, Borrowers shall be jointly and severally obligated to pay to the following fees: (i) Closing Fee. A closing fee equal to $325,000 payable to Agent for the ratable benefit of the Lenders, which fee shall be due and payable on the Closing Date. (ii) Arrangement Fee. An arrangement fee equal to $50,000 for the benefit of Agent, which fee shall be due and payable on the Closing Date. (iii) Collateral Monitoring Fee. A fee of $3,000 per month for each month (or portion of a month) from and after the Closing Date up to the date on which Full Payment of the Obligations and Full Payment (as defined in the Prepetition Senior Loan Agreement) of the Prepetition Senior Obligations occurs and the Commitment Termination Date has occurred, which fee shall be due and payable to Agent for the benefit of Agent monthly in arrears. 3.2.6. General Provisions. All fees shall be fully earned by the identified recipient thereof pursuant to the foregoing provisions of this Agreement on the due date thereof (and, in the case of Letters of Credit, upon each issuance, renewal or extension of such Letter of Credit); and, except as otherwise set forth herein or required by Applicable Law, shall not be subject to rebate, refund or proration. All fees provided for in Section 3.2 are, and shall be deemed to be compensation for services and are not, and shall not be deemed to be, interest or any other charge for the use, forbearance or detention of money. 3.3. Computation of Interest and Fees. All fees and other charges provided for in this Agreement that are calculated as a per annum percentage of any amount and all interest shall be calculated daily and shall be computed on the actual number of days elapsed over a year of 360 days. For purposes of computing interest and other charges hereunder, each Payment Item 51

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and other form of payment received by Agent (with the date of such receipt to be governed by Section 5.7) shall be deemed applied by Agent and Lenders on account of the Obligations (subject to final payment of such items) on the Business Day after the Business Day on which Agent receives such Payment Item, and Agent shall be deemed to have received such Payment Item on the date specified in Section 5.7. Each determination by Agent of interest and fees hereunder shall be presumptive evidence of the correctness of such interest and fees. 3.4.

Reimbursement Obligations.

3.4.1. Borrowers shall reimburse Agent and Lenders for any Extraordinary Expenses incurred by Agent or any Lender, on the sooner to occur of Agent’s demand therefor or Agent’s receipt of any proceeds of Collateral in connection with any Enforcement Action (subject to the provisions of Section 5.6 with respect to the application of any proceeds of Collateral). Borrowers also shall reimburse Agent for all reasonable legal, accounting, appraisal, consulting and other fees and expenses suffered or incurred by Agent in connection with: (i) the negotiation and preparation (and internal legal review) of any of the Loan Documents, any amendment or modification thereto; (ii) action taken to perfect or maintain the perfection or priority of any of Agent’s Liens with respect to any of the Collateral; (iii) subject to the limits set forth in Section 3.2.4, any inspection of or audits conducted by Agent with respect to any Borrower’s books and records or any of the Collateral; (iv) if subject to the limits set forth in Section 3.2.4, any inspection of or audits conducted by Agent any effort by Agent to verify or appraise any of the Collateral. All amounts chargeable to or reimbursable by Borrowers under this Section 3.4 shall constitute Obligations that are secured by all of the Collateral and shall be payable on demand to Agent. Borrowers also shall reimburse Agent for expenses incurred by Agent in its administration of any of the Collateral to the extent and in the manner provided in Section 8 or in any of the other Loan Documents. The foregoing shall be in addition to, and shall not be construed to limit, any other provision of any of the Loan Documents regarding the indemnification or reimbursement by Borrowers of Claims suffered or incurred by Agent or any Lender. 3.4.2. If at any time Agent or (with the prior consent of Agent) any Lender shall agree to indemnify any Person against losses or damages that such Person may suffer or incur in its dealings or transactions with Borrowers, or shall guarantee or otherwise assure payment of any liability or obligation of Borrowers to such Person, or otherwise shall provide assurances of Borrowers’ payment or performance under any agreement with such Person, including indemnities, guaranties or other assurances of payment or performance given by Agent or any Bank Product Provider with respect to Banking Relationship Debt, then the Contingent Obligation of Agent or any Lender providing any such indemnity, guaranty or other assurance of payment or performance, together with any payment made or liability incurred by Agent or any Lender in connection therewith, shall constitute Obligations that are secured by the Collateral and Borrowers shall repay, on demand, any amount so paid or any liability incurred by Agent or any Lender in connection with any such indemnity, guaranty or assurance. Nothing herein shall be construed to impose upon Agent or any Lender any obligation to provide any such indemnity, guaranty or assurance. The foregoing agreement of Borrowers shall apply whether or not such indemnity, guaranty or assurance is in writing or oral and regardless of any Borrower’s knowledge of the existence thereof, shall survive termination of the Revolver Commitments and 52

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Full Payment of the Obligations and any other provisions of the Loan Documents regarding reimbursement or indemnification by Borrowers of Claims suffered or incurred by Agent or any Lender. 3.5. Bank Charges. Borrowers shall pay to Agent, on demand, any and all out-ofpocket or reasonable fees, costs or expenses which Agent pays to a bank or other similar institution (including any fees paid by Agent or any Lender to any Participant) arising out of or in connection with (i) the forwarding to a Borrower or any other Person on behalf of Borrower by Agent of proceeds of Loans made by Lenders to a Borrower pursuant to this Agreement and (ii) the depositing for collection by Agent of any Payment Item received or delivered to Agent on account of the Obligations. Each Borrower acknowledges and agrees that Agent may charge such costs, fees and expenses to Borrowers based upon Agentâ&#x20AC;&#x2122;s good faith estimate of such costs, fees and expenses as they are incurred by Agent. 3.6.

[Reserved]

3.7. Increased Costs. If, by reason of (a) the introduction after the date hereof of or any change (including any change by way of imposition or increase of Statutory Reserves or other reserve requirements) in or in the interpretation of any law or regulation, or (b) the compliance with any guideline or request from any central bank or other Governmental Authority or quasi-Governmental Authority exercising control over banks or financial institutions generally (whether or not having the force of law): (i) any Lender shall be subject after the date hereof to any Tax, duty or other charge with respect to any Letter of Credit or its obligation to issue Letters of Credit or participate in the LC Obligations arising from the issuance of Letters of Credit, or a change shall result in the basis of taxation of payment to any Lender of its obligation to issue Letters of Credit or participate in the LC Obligations arising from the issuance of Letters of Credit (except for (A) changes in the rate of Tax on, or determined by reference to, the overall net income or gross receipts or franchise tax of such Lender imposed by the jurisdiction in which such Lenderâ&#x20AC;&#x2122;s principal executive office or applicable lending office is located or (B) any Taxes that are indemnified pursuant to Section 5.9 or would have been indemnified pursuant to Section 5.9 but for an applicable exclusion); or (ii) any reserve (including any imposed by the Board of Governors), special deposits or similar requirement against assets of, deposits with or for the account of, or credit extended by, any Lender shall be imposed or deemed applicable or any other condition affecting its Letters of Credit or its obligation to issue Letters of Credit or participate in the LC Obligations arising from the issuance of Letters of Credit shall be imposed on such Lender; and as a result thereof there shall be any increase in the cost to such Lender of issuing Letters of Credit, or there shall be a reduction in the amount received or receivable by such Lender, then such Lender shall, promptly after determining in good faith the existence or amount of any such increased costs for which such Lender seeks payment hereunder, give any Borrower notice 53

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thereof and Borrowers shall from time to time, upon written notice from and demand by such Lender (with a copy of such notice and demand to Agent), pay to Agent for the account of such Lender, within 10 Business Days after the date specified in such notice and demand, an additional amount sufficient to indemnify such Lender against such increased costs. A certificate as to the amount of such increased costs, submitted to Borrowers by such Lender, shall be final, conclusive and binding for all purposes, absent manifest error. Notwithstanding anything herein to the contrary, (a) all requests, rules, guidelines, requirements and directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar body) or by United States or foreign regulatory authorities, in each case pursuant to Basel III and (b) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines, requirements and directives thereunder or issued in connection therewith or in implementation thereof, shall in each case be deemed to be a change in law, regardless of the date enacted, adopted, issued or implemented. Notwithstanding anything herein to the contrary, increased costs as a result of any change in law shall only be reimbursable by the Borrowers to the extent the applicable Lender is generally requiring reimbursement therefor from borrowers under other asset-based lending credit facilities. If any Lender shall advise Agent at any time that, because of the circumstances described hereinabove in this Section 3.7 or any other circumstances arising after the date of this Agreement affecting such Lender, as determined by Agent, will not adequately and fairly reflect the cost to such Lender of issuing Letters of Credit, then, and in any such event: (i) Agent shall forthwith give notice (by telephone confirmed promptly in writing) to Borrowers and Lenders of such event; and (ii) Borrowers’ right to request and such Lender’s obligation to issue Letters of Credit or participate in the LC Obligations arising from the issuance of Letters of Credit shall be immediately suspended and Borrowers’ right to request a Letter of Credit shall also be suspended, until each condition giving rise to such suspension no longer exists. For purposes of this Section 3.7, all references to a Lender shall be deemed to include any bank holding company or bank parent of such Lender. 3.8. Capital Adequacy. If any Lender determines in good faith that after the date hereof (a) the adoption of any Applicable Law regarding capital requirements for banks or bank holding companies or the subsidiaries thereof, (b) any change in the interpretation or administration of any such Applicable Law by any Governmental Authority, central bank, or comparable agency charged with the interpretation or administration thereof, or (c) compliance by such Lender or its holding company with any request or directive of any such Governmental Authority, central bank or comparable agency regarding capital adequacy (whether or not having the force of law), has the effect of reducing the return on such Lender’s capital to a level below that which such Lender could have achieved (taking into consideration such Lender’s and its holding company’s policies with respect to capital adequacy immediately before such adoption, 54

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change or compliance and assuming that such Lender’s capital was fully utilized prior to such adoption, change or compliance) but for such adoption, change or compliance as a consequence of such Lender’s commitment to make the Loans pursuant hereto by any amount deemed by such Lender to be material: (i) Agent shall promptly, after its receipt of a certificate from such Lender setting forth such Lender’s determination of such occurrence, give notice thereof to Borrowers and Lenders; and (ii) Borrowers shall pay to Agent, for the account of such Lender, as an additional fee from time to time, on demand, such amount as such Lender certifies to be the amount reasonably calculated to compensate such Lender for such reduction. A certificate of such Lender claiming entitlement to compensation as set forth above will be conclusive in the absence of manifest error. Such certificate will set forth the nature of the occurrence giving rise to such compensation, the additional amount or amounts to be paid to such Lender (including the basis for such Lender’s determination of such amount), and the method by which such amounts were determined. In determining such amount, such Lender may use any reasonable averaging and attribution method. For purposes of this Section 3.8 all references to a Lender shall be deemed to include any bank holding company or bank parent of such Lender. 3.9. Mitigation. Each Lender agrees that, with reasonable promptness after such Lender becomes aware that such Lender is entitled to receive payments under Sections 3.6, 3.7, 3.8 or 5.9, or is or has become subject to U.S. withholding taxes payable by any Borrower in respect of its Loans, it will, to the extent not inconsistent with any internal policy of such Lender or any applicable legal or regulatory restriction, (i) use all reasonable efforts to make, fund or maintain the Revolver Commitment of such Lender or the Loans of such Lender through another lending office of such Lender, or (ii) take such other reasonable measures, if, as a result thereof, the circumstances which would relieve Borrowers from their obligations to pay such additional amounts (or reduce the amount of such payments), or such withholding taxes would be reduced, and if the making, funding or maintaining of such Revolver Commitment or Loans through such other lending office or in accordance with such other measures, as the case may be, would not otherwise adversely affect such Revolver Commitment or Loans or the interests of such Lender. 3.10.

[Reserved.]

3.11. Maximum Interest. Regardless of any provision contained in any of the Loan Documents, in no contingency or event whatsoever shall the aggregate of all amounts that are contracted for, charged or received by Agent and Lenders pursuant to the terms of this Agreement or any of the other Loan Documents and that are deemed interest under Applicable Law exceed the highest rate permissible under any Applicable Law. No agreements, conditions, provisions or stipulations contained in this Agreement or any of the other Loan Documents or the exercise by Agent of the right to accelerate the payment or the maturity of all or any portion of the Obligations, or the exercise of any option whatsoever contained in any of the Loan Documents, or the prepayment by Borrowers of any of the Obligations, or the occurrence of any 55

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contingency whatsoever, shall entitle Agent or any Lender to charge or receive in any event, interest or any charges, amounts, premiums or fees deemed interest by Applicable Law (such interest, charges, amounts, premiums and fees referred to herein collectively as “Interest”) in excess of the Maximum Rate and in no event shall Borrowers be obligated to pay Interest exceeding such Maximum Rate, and all agreements, conditions or stipulations, if any, which may in any event or contingency whatsoever operate to bind, obligate or compel Borrowers to pay Interest exceeding the Maximum Rate shall be without binding force or effect, at law or in equity, to the extent only of the excess of Interest over such Maximum Rate. If any Interest is charged or received with respect to the Obligations in excess of the Maximum Rate (“Excess”), each Borrower stipulates that any such charge or receipt shall be the result of an accident and bona fide error, and such Excess, to the extent received, shall be applied first to reduce the principal of such Obligations and the balance, if any, returned to Borrowers, it being the intent of the parties hereto not to enter into a usurious or otherwise illegal relationship. The right to accelerate the maturity of any of the Obligations does not include the right to accelerate any Interest that has not otherwise accrued on the date of such acceleration, and Agent and Lenders do not intend to collect any unearned Interest in the event of any such acceleration. Each Borrower recognizes that, with fluctuations in the rates of interest set forth in Section 3.1.1, and the Maximum Rate, such an unintentional result could inadvertently occur. All monies paid to Agent or any Lender hereunder or under any of the other Loan Documents, whether at maturity or by prepayment, shall be subject to any rebate of unearned Interest as and to the extent required by Applicable Law. By the execution of this Agreement, each Borrower covenants that (i) the credit or return of any Excess shall constitute the acceptance by such Borrower of such Excess, and (ii) such Borrower shall not seek or pursue any other remedy, legal or equitable, against Agent or any Lender, based in whole or in part upon contracting for, charging or receiving any Interest in excess of the Maximum Rate. For the purpose of determining whether or not any Excess has been contracted for, charged or received by Agent or any Lender, all Interest at any time contracted for, charged or received from Borrowers in connection with any of the Loan Documents shall, to the extent permitted by Applicable Law, be amortized, prorated, allocated and spread in equal parts throughout the full term of the Obligations. Borrowers, Agent and Lenders shall, to the maximum extent permitted under Applicable Law, (i) characterize any nonprincipal payment as an expense, fee or premium rather than as Interest and (ii) exclude voluntary prepayments and the effects thereof. The provisions of this Section 3.11 shall be deemed to be incorporated into every Loan Document (whether or not any provision of this Section is referred to therein). All such Loan Documents and communications relating to any Interest owed by Borrowers and all figures set forth therein shall, for the sole purpose of computing the extent of Obligations, be automatically recomputed by Borrowers, and by any court considering the same, to give effect to the adjustments or credits required by this Section 3.11. SECTION 4.

LOAN ADMINISTRATION

4.1. Manner of Borrowing and Funding Revolver Loans. Borrowings under the Revolver Commitments established pursuant to Section 2.1 shall be made and funded as follows:

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Notice of Borrowing.

(i) Whenever Borrowers desire to make a Borrowing under Section 2.1, Borrowers shall give Agent prior written notice (or telephonic notice promptly confirmed in writing) of such Borrowing request (a â&#x20AC;&#x153;Notice of Borrowingâ&#x20AC;?), which shall be in the form of Exhibit D annexed hereto and signed by an authorized officer of Borrower Agent. Such notice must be received by Agent no later than 1:00 p.m. (New York time) on the Business Day that is the requested Borrowing date. All Revolver Loans made by each Lender shall be made as Base Rate Loans. Each Notice of Borrowing (or telephonic notice thereof) shall be irrevocable and shall specify (a) the principal amount of the Borrowing, (b) the date of Borrowing (which shall be a Business Day), and (c) the account of Borrowers to which the proceeds of such Borrowing are to be disbursed. (ii) Unless payment is otherwise timely made by Borrowers, the becoming due of any amount required to be paid with respect to any of the Obligations (whether as principal, accrued interest, fees or other charges, including any LC Obligations, Extraordinary Expenses, and any amounts owed to any Bank Product Provider for Banking Relationship Debt) shall be deemed irrevocably to be a request (without any requirement for the submission of a Notice of Borrowing) for Revolver Loans on the due date of, and in an aggregate amount required to pay, such Obligations, and the proceeds of such Revolver Loans may be disbursed by way of direct payment of the relevant Obligation and shall bear interest as Base Rate Loans. Neither Agent nor any Lender shall have any obligation to Borrowers to honor any deemed request for a Revolver Loan on or after the Commitment Termination Date, when an Out-of-Formula Condition exists or would result therefrom, or when any applicable condition precedent set forth in Section 11 is not satisfied, but may do so in the discretion of Agent (or at the direction of the Required Lenders) and without regard to the existence of, and without being deemed to have waived, any Default or Event of Default and regardless of whether such Revolver Loan is funded after the Commitment Termination Date. (iii) If Borrowers elect to establish Controlled Disbursement Accounts with Agent or any of its Affiliates, then the presentation for payment by Agent of any check or other item of payment drawn on such Controlled Disbursement Account at a time when there are insufficient funds in such account to cover such check shall be deemed irrevocably to be a request (without any requirement for the submission of a Notice of Borrowing) for Revolver Loans on the date of such presentation and in an amount equal to the aggregate amount of the items presented for payment, and the proceeds of such Revolver Loans may be disbursed to such Controlled Disbursement Account and shall bear interest as Base Rate Loans. Neither Agent nor any Lender shall have any obligation to honor any deemed request for a Revolver Loan on or after the Commitment Termination Date or when an Out-of-Formula Condition exists or would result therefrom or when any condition precedent in Section 11 is not satisfied or to the extent that to the extent that such Revolver Loan would cause the Borrower to exceed the budgeted amount for the period during which such Revolver Loan would be made as set forth in the Approved Budget (after giving effect to the Permitted Variances), but may do so in the discretion of Agent (or at the direction of the Required Lenders) and without 57

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regard to the existence of, and without being deemed to have waived, any Default or Event of Default and regardless of whether such Revolver Loan is funded after the Commitment Termination Date. 4.1.2. Fundings by Lenders. In the event that Agent is not obligated to make a Swingline Loan pursuant to Section 4.1.3(ii), then promptly after receipt of a Notice of Borrowing pursuant to Section 4.1.1(i) (except in the case of a deemed request by Borrower Agent for a Revolver Loan as provided in Section 4.1.1(ii) or (iii) or Section 4.1.3(ii), in which event no Notice of Borrowing need be submitted), Agent shall notify the Lenders, not later than 2:00 p.m. (New York time) on the Business Day immediately preceding the Borrowing date applicable thereto, by telecopy, telephone, or other similar form of transmission, of the requested Borrowing. Each Lender shall make the amount of such Lender’s Pro Rata share of the requested Borrowing available to Agent in immediately available funds, to Agent’s Account, not later than 2:00 p.m. (New York time) on the Borrowing date applicable thereto. Subject to its receipt of such amounts from Lenders, Agent shall make the proceeds of the Revolver Loans received by it available to Borrowers by disbursing such proceeds in accordance with Borrower Agent’s disbursement instructions set forth in the applicable Notice of Borrowing. Neither Agent nor any Lender shall have any liability on account of any delay by any bank or other depository institution in treating the proceeds of any Revolver Loan as collected funds or any delay in receipt, or any loss, of funds that constitute a Revolver Loan, the wire transfer of which was initiated by Agent in accordance with wiring instructions provided to Agent. Unless Agent shall have been notified in writing by a Lender prior to the proposed time of funding that such Lender does not intend to deposit with Agent an amount equal such Lender’s Pro Rata share of the requested Borrowing (or deemed request for a Borrowing pursuant to Section 4.1.1(ii) or (iii)), Agent may assume that such Lender has deposited or promptly will deposit its share with Agent and Agent may in its discretion disburse a corresponding amount to Borrowers on the applicable funding date. If a Lender’s Pro Rata share of such Borrowing is not in fact deposited with Agent, then, if Agent has disbursed to Borrowers an amount corresponding to such share, then such Lender agrees to pay, and in addition Borrowers agree to repay, to Agent forthwith on demand such corresponding amount, together with interest thereon, for each day from the date such amount is disbursed by Agent to or for the benefit of Borrowers until the date such amount is paid or repaid to Agent, (a) in the case of Borrowers, at the interest rate applicable to such Borrowing and (b) in the case of such Lender, at the Federal Funds Rate. If such Lender repays to Agent such corresponding amount, such amount so repaid shall constitute a Revolver Loan, and if both such Lender and Borrowers shall have repaid such corresponding amount, Agent shall promptly return to Borrowers such corresponding amount in same day funds. A notice from Agent submitted to any Lender with respect to amounts owing under this Section 4.1.2 shall be conclusive, absent manifest error. 4.1.3.

Settlement and Swingline Loans.

(i) In order to facilitate the administration of the Revolver Loans under this Agreement, Lenders and Agent agree (which agreement shall be solely between Lenders and Agent and shall not be for the benefit of or enforceable by any Borrower) that settlement among them with respect to the Revolver Loans may take place on a periodic basis on dates determined from time to time by Agent (each a “Settlement 58

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Date”), which may occur before or after the occurrence or during the continuance of a Default or Event of Default and whether or not all of the conditions set forth in Section 11 have been met. On each Settlement Date, payment shall be made by or to each Lender in the manner provided herein and in accordance with the Settlement Report delivered by Agent to Lenders with respect to such Settlement Date so that, as of each Settlement Date and after giving effect to the transaction to take place on such Settlement Date, each Lender shall hold its Pro Rata share of all Revolver Loans and participations in LC Obligations. Agent shall request settlement with the Lenders on a basis not less frequently than once every 5 Business Days.

(ii) Between Settlement Dates, WFCF may, but shall in no event be obligated to, advance to Borrowers out of WFCF’s own funds the entire principal amount of any Borrowing of Revolver Loans that are Base Rate Loans requested or deemed requested pursuant to this Agreement (any such Revolver Loan funded exclusively by WFCF being referred to as a “Swingline Loan”). Each Swingline Loan shall constitute a Revolver Loan hereunder and shall be subject to all of the terms, conditions and security applicable to other Revolver Loans, except that all payments thereon shall be payable to WFCF solely for its own account. The obligation of Borrowers to repay such Swingline Loans to Agent shall be evidenced by the records of WFCF and need not be evidenced by any promissory note. Unless a funding is required by all Lenders pursuant to Section 13.9.4, WFCF shall not make any Swingline Loan if (A) Agent shall have received written notice from any Lender that one or more of the applicable conditions precedent set forth in Section 11 will not be satisfied on the requested funding date for the applicable Borrowing and Agent has made a determination (without any liability to any Person) that such condition precedent will not be satisfied or (B) the requested Borrowing would exceed the amount of Availability on the funding date or (C) the aggregate amount of all Swingline Loans outstanding would exceed $6,500,000. WFCF shall not be required to determine whether the applicable conditions precedent set forth in Section 11 have been satisfied or the requested Borrowing would exceed the amount of Availability on the funding date applicable thereto or cause the Borrower to exceed the budgeted amount for the period during which such Revolver Loan would be made as set forth in the Approved Budget (after giving effect to the Permitted Variances) prior to making, in its sole discretion, any Swingline Loan. On each Settlement Date, or, if earlier, upon demand by Agent for payment thereof, the then outstanding Swingline Loans shall be immediately due and payable. As provided in Section 4.1.1(ii), Borrowers shall be deemed to have requested (without the necessity of submitting any Notice of Borrowing) Revolver Loans to be made on each Settlement Date in the amount of all outstanding Swingline Loans and to have Agent cause the proceeds of such Revolver Loans to be applied to the repayment of such Swingline Loans and interest accrued thereon. Agent shall notify the Lenders of the outstanding balance of Revolver Loans prior to 2:00 p.m. (New York time) on the Business Day immediately prior to each Settlement Date and each Lender (other than WFCF) shall deposit with Agent (without setoff, counterclaim or reduction of any kind) an amount equal to its Pro Rata share of the amount of Revolver Loans deemed requested in immediately available funds not later than 12:00 p.m. (New York time) on such Settlement Date. Each Lender’s obligation to make such deposit with Agent shall be absolute and unconditional, without defense, offset, counterclaim or other

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defense, and without regard to whether any of the conditions precedent set forth in Section 11 are satisfied, any Out-of-Formula Condition exists or the Commitment Termination Date has occurred. If, as the result of the commencement by or against Borrowers of any Insolvency Proceeding or otherwise, any Swingline Loan may not be repaid by the funding by Lenders of Revolver Loans, then each Lender (other than WFCF) shall be deemed to have purchased a participating interest in any unpaid Swingline Loan in an amount equal to such Lender’s Pro Rata share of such Swingline Loan and shall transfer to WFCF, in immediately available funds not later than the second Business Day after WFCF’ request therefor, the amount of such Lender’s participation. The proceeds of Swingline Loans may be used solely for purposes for which Revolver Loans generally may be used in accordance with Section 2.2.3. If any amounts received by WFCF in respect of any Swingline Loans are later required to be returned or repaid by WFCF to Borrowers or their respective representatives or successors-in-interest, whether by court order, settlement or otherwise, the other Lenders shall, upon demand by WFCF with notice to Agent, pay to Agent for the account of WFCF, an amount equal to each other Lender’s Pro Rata share of all such amounts required to be returned or repaid. 4.1.4. Disbursement Authorization. Each Borrower hereby irrevocably authorizes Agent to disburse the proceeds of each Revolver Loan requested by any Borrower, or deemed to be requested pursuant to Section 4.1.1 or Section 4.1.3(ii), as follows: (i) the proceeds of each Revolver Loan requested under Section 4.1.1(i) shall be disbursed by Agent in accordance with the terms of the written disbursement letter from Borrowers in the case of the initial Borrowing, and, in the case of each subsequent Borrowing, by wire transfer to such bank account as may be agreed upon by Borrowers and Agent from time to time or elsewhere if pursuant to a written direction from any Borrower; and (ii) the proceeds of each Revolver Loan requested under Section 4.1.1(ii) or Section 4.1.3(ii) shall be disbursed by Agent by way of direct payment of the relevant interest or other Obligation. Any Loan proceeds received by any Borrower or in payment of any of the Obligations shall be deemed to have been received by all Borrowers. 4.1.5. Telephonic Notices. Each Borrower authorizes Agent to extend and transfer funds to or on behalf of Borrowers based on telephonic notices or instructions from any individual whom Agent or any Lender in good faith believes to be acting on behalf of Borrower Agent or any Borrower; provided, that any telephonic notice in lieu of a Notice of Borrowing pursuant to Section 4.1.1(i) shall be received by the time required for a Notice of Borrowing in accordance with Section 4.1.1(i), such telephonic notice to be confirmed in writing within 24 hours of the giving thereof. If the written confirmation differs in any material respect from the action taken by Agent or Lenders, the records of Agent and Lenders shall govern. Neither Agent nor any Lender shall have any liability for any loss suffered by any Borrower as a result of Agent’s or any Lender’s acting upon its understanding of telephonic instructions or requests from a person believed in good faith by Agent or any Lender to be a person authorized by a Borrower to give such instructions or to make such requests on Borrowers’ behalf. 4.2. Defaulting Lender. If any Lender shall, at any time, fail to make any payment to Agent or WFCF that is required hereunder, Agent may, but shall not be required to, retain 60

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payments that would otherwise be made to such defaulting Lender hereunder and apply such payments to such defaulting Lender’s defaulted obligations hereunder, at such time, and in such order, as Agent may elect in its sole discretion. With respect to the payment of any funds from Agent to a Lender or from a Lender to Agent, the party failing to make the full payment when due pursuant to the terms hereof shall, upon demand by the other party, pay such amount together with interest on such amount at the Federal Funds Rate. The failure of any Lender to fund its portion of any Revolver Loan or payment in respect of an LC Obligation shall not relieve any other Lender of its obligation, if any, to fund its portion of the Revolver Loan or payment in respect of an LC Obligation on the date of Borrowing, but no Lender shall be responsible for the failure of any other Lender to make any Loan or payment in respect of an LC Obligation to be made by such Lender on the date of any Borrowing. Solely as among the Lenders and solely for purposes of voting or consenting to matters with respect to any of the Loan Documents, Collateral or any Obligations and determining a defaulting Lender’s share of payments and proceeds of Collateral pending such defaulting Lender’s cure of its defaults hereunder, a defaulting Lender shall not be deemed to be a “Lender” and such Lender’s Revolver Commitment shall be deemed to be zero (0). The provisions of this Section 4.2 shall be solely for the benefit of Agent and Lenders and may not be enforced by Borrowers. 4.3.

[Reserved]

4.4. Borrower Agent. Each Borrower hereby irrevocably appoints Angelica, and Angelica agrees to act under this Agreement, as the agent and representative of itself and each other Borrower for all purposes under this Agreement (in such capacity, “Borrower Agent”), including requesting Borrowings, and receiving account statements and other notices and communications to Borrowers (or any of them) from Agent. Agent may rely, and shall be fully protected in relying, on any Notice of Borrowing, disbursement instructions, reports, information, Borrowing Base Certificate or any other notice or communication made or given by Borrower Agent, whether in its own name, on behalf of any Borrower or on behalf of “the Borrowers,” and Agent shall have no obligation to make any inquiry or request any confirmation from or on behalf of any other Borrower as to the binding effect on such Borrower of any such Notice of Borrowing, instruction, report, information, Borrowing Base Certificate or other notice or communication, nor shall the joint and several character of Borrowers’ liability for the Obligations be affected, provided, that, the provisions of this Section 4.4 shall not be construed so as to preclude any Borrower from directly requesting Borrowings or taking other actions permitted to be taken by “a Borrower” hereunder. Agent may maintain a single Loan Account in the name of “Angelica Corporation” hereunder, and each Borrower expressly agrees to such arrangement and confirms that such arrangement shall have no effect on the joint and several character of such Borrower’s liability for the Obligations. 4.5. Loans to Constitute One General Obligation. The Loans and LC Obligations shall constitute one general obligation of Borrowers and (unless otherwise expressly provided in any Security Document) shall be secured by Agent’s Liens upon all of the Collateral; provided, however, that Agent and each Lender shall be deemed to be a creditor of each Borrower and the holder of a separate claim against each Borrower to the extent of any Obligations owed by Borrowers to Agent or such Lender. 61

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SECTION 5.

PAYMENTS

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General Payment Provisions.

5.1.1. General Application to Prepetition Senior Obligations and Obligations. Subject to the terms of the DIP Order, all payments (including all prepayments) received by Agent shall be applied to the Prepetition Senior Obligations and Obligations as follows: first to all Prepetition Senior Obligations until Full Payment (as defined in the Prepetition Senior Loan Agreement) thereof (including, without limitation the Cash Collateralization (as defined in the Prepetition Senior Loan Agreement) of the Prepetition Senior Letters of Credit through the deposit of collections and/or the making of Revolver Advances into the Prepetition Senior Cash Collateral Account), and second, to the Obligations until Full Payment thereof. 5.1.2. Other General Provisions. All payments (including all prepayments) of principal of and interest on the Loans, LC Obligations and other Obligations that are payable to Agent or any Lender shall be made to Agent in Dollars without any offset or counterclaim and free and clear of (and without deduction for) any present or future Taxes, and, with respect to payments made other than by application of collections to the Collection Account, in immediately available funds not later than 11:00 a.m. (New York time) on the due date (and payment made after such time on the due date to be deemed to have been made on the next succeeding Business Day and any applicable interest or fee shall continue to accrue until such following Business Day). All payments received by Agent shall be distributed by Agent in accordance with this Agreement, hereof, subject to the rights of offset that Agent may have as to amounts otherwise to be remitted to a particular Lender by reason of amounts due Agent from such Lender under any of the Loan Documents. 5.2.

Repayment of Revolver Loans.

5.2.1. Payment of Principal. The outstanding principal amounts with respect to the Revolver Loans shall be repaid as follows: (i) Any portion of the Revolver Loans consisting of the principal amount of Base Rate Loans shall be paid by Borrowers to Agent, for the Pro Rata benefit of Lenders (or, in the case of Swingline Loans, for the sole benefit of WFCF), subject to the terms of the DIP Order, immediately upon (a) each receipt by Agent, any Lender or Borrowers of any proceeds of any of the Accounts or Inventory, to the extent of such proceeds, (b) the Commitment Termination Date, and (c) in the case of Swingline Loans on each Settlement Date with respect to all Swingline Loans outstanding on such date. (ii)

[Reserved.]

(iii) Notwithstanding anything to the contrary contained elsewhere in this Agreement, if an Out-of-Formula Condition shall exist, Borrowers shall, subject to the terms of the DIP Order, on the sooner to occur of Agentâ&#x20AC;&#x2122;s demand or the first Business Day after any Borrower has obtained knowledge of such Out-of-Formula Condition, repay the outstanding Revolver Loans that are Base Rate Loans in an amount 62

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sufficient to reduce the aggregate unpaid principal amount of all Revolver Loans by an amount equal to such excess. 5.2.2. Payment of Interest. Subject to the terms of the DIP Order, interest accrued on the Revolver Loans shall be due and payable monthly in arrears, on the first Business Day of each calendar month (for the immediately preceding calendar month), computed through the last day of the preceding calendar month. Accrued interest shall also be paid by Borrowers on the Commitment Termination Date. 5.3.

[Reserved]

5.4. Payment of Other Obligations. The balance of the Obligations requiring the payment of money, including LC Obligations and Extraordinary Expenses, shall be repaid by Borrowers to Agent for allocation among Agent and Lenders as provided in the Loan Documents and the DIP Order, or, if no date of payment is otherwise specified in the Loan Documents or the DIP Order, on demand. 5.5. Payments Set Aside. If Borrowers make a payment to Agent or Lenders or if Agent or any Lender receives proceeds of any Collateral or exercises its right of setoff, and such payment or proceeds of Collateral or setoff (or any part thereof) are subsequently invalidated, declared to be fraudulent or preferential, set aside or required to be repaid to a trustee, receiver or any other Person, then to the extent of any loss by Agent or Lenders, the Obligations or part thereof originally intended to be satisfied, and all Liens, rights and remedies therefor, shall be revived and continued in full force and effect as if such payment or proceeds had not been made or received and any such enforcement or setoff had not occurred. The provisions of the immediately preceding sentence of this Section 5.5 shall survive any termination of the Revolver Commitments and Full Payment of the Obligations. 5.6.

Allocation of Payments.

5.6.1. Allocation. At any time that an Event of Default exists or Agent receives a payment or Collateral proceeds in an amount that is insufficient to pay all amounts then due and payable to Agent and Lenders, all monies to be applied to the Obligations or Prepetition Senior Obligations pursuant to the terms of the DIP Order, whether such monies represent voluntary or mandatory payments or prepayments by one or more Borrowers or are received pursuant to demand for payment or realized from any disposition of Collateral and irrespective of any designation by Borrowers of the Obligations or Prepetition Senior Obligations that are intended to be satisfied, shall be allocated, subject to the terms of the DIP Order, among Prepetition Senior Agent (for further allocation to each of the Prepetition Senior Secured Parties in accordance with the terms of the Prepetition Senior Loan Agreement), Agent, and such of the Lenders as are entitled thereto (and, with respect to monies allocated to Lenders, on a Pro Rata basis unless otherwise provided herein): (i) first, to the Prepetition Senior Agent for allocation to the Prepetition Senior Obligations in accordance with the terms of the Prepetition Senior Loan Agreement and the DIP Order, (ii) second to Agent to pay the amount of Extraordinary Expenses that have not been reimbursed to Agent by Borrowers or Lenders, together with interest accrued thereon at the rate applicable to Revolver Loans that are Base Rate Loans, until Full Payment of 63

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all such Obligations; (iii) third, to Agent to pay principal and accrued interest on any portion of the Revolver Loans which Agent may have advanced on behalf of any Lender and for which Agent has not been reimbursed by such Lender or Borrowers, until Full Payment of all such Obligations; (iv) fourth, to WFCF to pay the principal and accrued interest on any portion of the Swingline Loans outstanding, to be shared with Lenders that have acquired and paid for a participating interest in such Swingline Loans, until Full Payment of all such Obligations; (v) fifth, to the extent that Issuing Bank has not received from any Participating Lender a payment as required by Section 2.3.2, to Issuing Bank to pay all such required payments from each Participating Lender, until Full Payment of all such Obligations; (vi) sixth, to Agent to pay any Claims that have not been paid pursuant to any indemnity of Agent Indemnitees by any Borrower, or to pay amounts owing by Lenders to Agent Indemnitees pursuant to Section 13.6, in each case together with interest accrued thereon at the rate applicable to Revolver Loans that are Base Rate Loans, until Full Payment of all such Obligations; (vii) seventh, to Agent to pay any fees due and payable to Agent in accordance with the Loan Documents, until Full Payment of all such Obligations; (viii) eighth, to each Lender, ratably, for any Claims such Lender has paid to Agent Indemnitees pursuant to its indemnity of Agent Indemnitees and any Extraordinary Expenses such Lender has reimbursed to Agent or such Lender has incurred, to the extent that such Lender has not been reimbursed by Borrowers therefor; (ix) ninth, to Issuing Bank to pay principal and interest with respect to LC Obligations (or to the extent any of the LC Obligations are contingent and an Event of Default then exists, deposited in the Cash Collateral Account to Cash Collateralize the LC Obligations), which payment shall be shared with the Participating Lenders in accordance with Section 2.3.2(iii); and (x) tenth, on a ratable basis, to (A) Lenders in payment of the unpaid principal and accrued interest in respect of the Loans and other Obligations (excluding Banking Relationship Debt) then outstanding, in such order of application as shall be designated by Agent (acting at the direction or with the consent of the Required Lenders) and (B) Bank Product Providers in payment of any Banking Relationship Debt owed to such Person and secured by the Collateral hereunder. The allocations set forth in this Section 5.6 are solely to determine the rights and priorities of Agent and Lenders as among themselves and may be changed by Agent and Lenders without notice to or the consent or approval of any Borrower or any other Person. 5.6.2. Erroneous Allocation. Agent shall not be liable for any allocation or distribution of payments made by it in good faith and, if any such allocation or distribution is subsequently determined to have been made in error, the sole recourse of any Lender to which payment was due but not made shall be to recover from the other Lenders any payment in excess of the amount to which such other Lenders are determined to be entitled (and such other Lenders hereby agree to return to such Lender any such erroneous payments received by them). 5.7. Application of Payments and Collateral Proceeds. All Payment Items received by Agent by 11:00 a.m. (New York time), on any Business Day shall be deemed received on that Business Day. All Payment Items received by Agent after 11:00 a.m. (New York time), on any Business Day shall be deemed received on the following Business Day. Each Borrower irrevocably waives the right to direct the application of any and all payments and Collateral proceeds at any time or times hereafter received by Agent or any Lender from or on behalf of Borrowers, and each Borrower does hereby irrevocably agree that Agent shall have the continuing exclusive right to apply and reapply any and all such payments and Collateral 64

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proceeds received at any time or times hereafter by Agent or its agent against the Obligations (including by application of collections received to the Collection Account to pay down the Obligations), in such manner as Agent may deem reasonably advisable, notwithstanding any entry by Agent upon any of its books and records; provided, however, that any payments or proceeds of Collateral received by Agent on any date that an Event of Default does not exist shall be applied in accordance with the DIP Order and any provisions of this Agreement that govern the application of such payment or proceeds. If, as the result of Agent’s collection of proceeds of Accounts and other Collateral as authorized by Section 8.2.6 a credit balance exists and no Loans or other Obligations are outstanding, such credit balance shall not accrue interest in favor of Borrowers, but shall be available to Borrowers at any time or times for so long as no Default or Event of Default exists. Agent may apply such credit balance against any of the Obligations upon and after the occurrence of an Event of Default in the manner specified in Section 5.6.1. 5.8.

Loan Accounts; the Register; Account Stated.

5.8.1. Loan Accounts. Each Lender shall maintain in accordance with its usual and customary practices an account or accounts (a “Loan Account”) evidencing the Debt of Borrowers to such Lender resulting from each Loan owing to such Lender from time to time, including the amount of principal and interest payable to such Lender from time to time hereunder. Any failure of a Lender to record in the Loan Account, or any error in doing so, shall not limit or otherwise affect the obligation of Borrowers hereunder to pay any amount owing hereunder to such Lender. 5.8.2. The Register. Agent shall, on behalf of the Borrowers, maintain a register (the “Register”), which shall include a master account and a subsidiary account for each Lender and in which accounts (taken together) shall be recorded (i) the date and amount of each Borrowing made hereunder, (ii) the effective date and amount of each Assignment and Acceptance delivered to and accepted by it and the parties thereto, (iii) the amount of any principal or interest due and payable or to become due and payable from Borrowers to each Lender hereunder, and (iv) the amount of any sum received by Agent from Borrowers and each Lender’s Pro Rata share thereof. The Register shall be available for inspection by Borrowers or any Lender (but only as to such Lender’s entry in the Register) at the offices of Agent at any reasonable time and from time to time upon reasonable prior notice. Any such recording shall be conclusive and binding in the absence of manifest error; provided, that any failure of Agent to record in the Register, or any error in doing so, shall not limit or otherwise affect the obligation of Borrowers hereunder to pay any amount owing with respect to the Loans or provide the basis for any claim against Agent. 5.8.3. Entries Binding. The entries made in the Register and each Loan Account shall constitute rebuttably presumptive evidence of the information contained therein; provided, however, that if a copy of information contained in the Register or any Loan Account is provided to any Person, or any Person inspects the Register or any Loan Account, at any time or from time to time, then the information contained in the Register or the Loan Account, as applicable, shall be conclusive and binding on such Person for all purposes absent manifest error, unless such Person notifies Agent in writing within 30 days after such Person’s receipt of such 65

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copy or such Person’s inspection of the Register or Loan Account of its intention to dispute the information contained therein. 5.9.

Taxes.

5.9.1. Gross up for Taxes. If the applicable withholding agent shall be required by Applicable Law to withhold or deduct any Taxes from or in respect of any sum payable under this Agreement or any of the other Loan Documents, (a) the applicable withholding agent shall make such withholding or deductions, (b) the applicable withholding agent shall pay the full amount withheld or deducted to the relevant taxation authority or other authority in accordance with Applicable Law, and (c) the sum payable to Agent or such Lender shall be increased as may be necessary so that, after making all required withholding or deductions in respect of such Indemnified Taxes (including withholding or deduction applicable to additional sums payable under this Section 5.9.1), Agent or such Lender (as the case may be) receives an amount equal to the sum it would have received had no such withholding or deductions in respect of such Indemnified Taxes been made. 5.9.2. Payment of Other Taxes by Borrowers. The Borrowers shall timely pay to the relevant Governmental Authority in accordance with applicable law, or at the option of Agent timely reimburse it for the payment of, any Other Taxes. 5.9.3. Evidence of Payments. As soon as practicable after any payment of Taxes by Borrower to a Governmental Authority pursuant to this Section 5.9, Borrowers shall deliver to Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to Agent. 5.9.4. Survival. Each party’s obligations under this Section 5.9 shall survive the resignation or replacement of Agent or any assignment of rights by, or the replacement of, a Lender, and the repayment, satisfaction or discharge of all obligations under any Loan Document. 5.10.

Withholding Tax Exemption.

5.10.1. At least 5 Business Days prior to the first date on which interest or fees are payable hereunder for the account of any Lender, (A) in the case of a Lender that is a Foreign Lender, such Foreign Lender agrees that it will deliver to Borrowers and Agent two (2) duly completed original signed copies of United States Internal Revenue Service Form W-8BEN (and to the extent a W-8BEN is with respect to the portfolio interest exemption under Section 871(h) or 881(c) of the Code, a certificate substantially in the form of Exhibit K (any such certificate, a “Non-Bank Certificate”) shall be delivered to Borrowers and Agent along with such W-8BEN), W-8ECI or W-8IMY (or any subsequent replacement substitute or form therefor), certifying in either case that such Lender is entitled to receive payment under this Agreement without deduction or withholding of any United States federal income taxes, (B) in the case of any Lender that is a United States person (as defined under Section 7701(a)(30) of the Code), two (2) duly completed original signed copies of United States Internal Revenue Service Form W-9. 66

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Each Lender which so delivers a Form W-9, W-8BEN, W-8IMY or W-8ECI,as the case may be, further undertakes to deliver to Borrowers and Agent two (2) additional copies of such form (or a successor form) on or before the date that such form expires (currently, 3 successive calendar years for Form W-8BEN and one calendar year for Form W-8ECI) or becomes obsolete or after the occurrence of any event requiring a change in the most form so delivered by it, and such amendments thereto or extensions or renewals thereof as may be reasonably requested by Borrowers or Agent, in each case, certifying that such Lender is entitled to receive payments under this Agreement without deduction or withholding of any United States federal income taxes, unless a change in applicable law has occurred prior to the date on which any such delivery would otherwise be required that renders all such forms inapplicable or that would prevent such Lender from duly completing and delivering any such form with respect to it and such Lender advises Borrowers and Agent that it is not capable of receiving payments without any deduction or withholding of United States federal income taxes. 5.10.2. FATCA. If a payment made to a Foreign Lender under any Loan Document would be subject to U.S. federal withholding tax imposed by FATCA if such Foreign Lender were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Foreign Lender shall deliver to the Borrowers and Agent at the time or times prescribed by law and at such time or times reasonably requested by Borrowers or Agent such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by Borrowers or Agent as may be necessary for Borrower and Agent to comply with their obligations under FATCA and to determine that such Foreign Lender has complied with such Foreign Lender’s obligations under FATCA or to determine the amount to deduct and withhold from such payment. Solely for purposes of this Section 5.10.2, “FATCA” shall include any amendments made to FATCA after the date of this Agreement. 5.10.3. Refund. If any Lender or Agent determines, in its sole discretion, that it has received a refund in respect of any Taxes as to which indemnification or additional amounts have been paid to it by the Borrowers pursuant to Section 5.9, it shall promptly remit such refund to the applicable Borrower, net of all out-of-pocket expenses of the Lender or Agent (including Taxes), as the case may be and without interest (other than any interest paid by the relevant taxing authority with respect to such refund net of any Taxes payable by any Agent or Lender on such interest); provided that the Borrower, upon the request of the Lender or Agent, as the case may be, agrees promptly to return such refund (plus any penalties, interest or other charges imposed by the relevant taxing authority) to such party in the event such party is required to repay such refund to the relevant taxing authority. This section shall not be construed to require the Agent or any Lender to make available its tax returns (or any other information relating to taxes that it deems confidential) to the Borrower or any other person. 5.11.

Nature and Extent of Each Borrower’s Liability.

5.11.1. Joint and Several Liability. Each Borrower shall be liable for, on a joint and several basis, and hereby guarantees the timely payment by all other Borrowers of, all of the Loans and other Obligations, regardless of which Borrower actually may have received the 67

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proceeds of any Loans or other extensions of credit hereunder or the amount of such Loans received or the manner in which Agent or any Lender accounts for such Loans or other extensions of credit on its books and records, it being acknowledged and agreed that Loans to any Borrower inure to the mutual benefit of all Borrowers and that Agent and Lenders are relying on the joint and several liability of Borrowers in extending the Loans and other financial accommodations hereunder. Each Borrower hereby unconditionally and irrevocably agrees that upon default in the payment when due (whether at stated maturity, by acceleration or otherwise) of any principal of, or interest owed on, any of the Loans or other Obligations, such Borrower shall forthwith pay the same, without notice or demand. 5.11.2. Unconditional Nature of Liability. Each Borrower’s joint and several liability hereunder with respect to, and guaranty of, the Loans and other Obligations shall, to the fullest extent permitted by Applicable Law, be unconditional irrespective of (i) the validity, enforceability, avoidance or subordination of any of the Obligations or of any promissory note or other document evidencing all or any part of the Obligations, (ii) the absence of any attempt to collect any of the Obligations from any other Borrower or any Collateral or other security therefor, or the absence of any other action to enforce the same, (iii) the waiver, consent, extension, forbearance or granting of any indulgence by Agent or any Lender with respect to any provision of any instrument evidencing or securing the payment of any of the Obligations, or any other agreement now or hereafter executed by any other Borrower and delivered to Agent or any Lender, (iv) the failure by Agent to take any steps to perfect or maintain the perfected status of its security interest in or Lien upon, or to preserve its rights to, any of the Collateral or other security for the payment or performance of any of the Obligations or Agent’s release of any Collateral or of its Liens upon any Collateral, (v) Agent’s or Lenders’ election, in any proceeding instituted under the Bankruptcy Code, including, without limitation, any of the Chapter 11 Cases, for the application of Section 1111(b)(2) of the Bankruptcy Code, (vi) any borrowing or grant of a security interest by any other Borrower, as debtor-in-possession under Section 364 of the Bankruptcy Code, (vii) the release or compromise, in whole or in part, of the liability of any Borrower for the payment of any of the Obligations, (viii) any amendment or modification of any of the Loan Documents or any waiver of a Default or Event of Default, (ix) any increase in the amount of the Obligations beyond any limits imposed herein or in the amount of any interest, fees or other charges payable in connection therewith, or any decrease in the same, (x) the disallowance of all or any portion of Agent’s or any Lender’s claims against any other Borrower for the repayment of any of the Obligations under Section 502 of the Bankruptcy Code, or (xi) any other circumstance that might constitute a legal or equitable discharge or defense of any Borrower. After the occurrence and during the continuance of any Event of Default, Agent may proceed directly and at once, without notice to any Borrower against any or all Borrowers to collect and recover all or any part of the Obligations, without first proceeding against any other Borrower or against any Collateral or other security for the payment or performance of any the Obligations, and each Borrower waives any provision under Applicable Law that might otherwise require Agent to pursue or exhaust its remedies against any Collateral or Borrower before pursuing another Borrower. Each Borrower consents and agrees that Agent shall be under no obligation to marshal any assets in favor of any Borrower or against or in payment of any or all of the Obligations. 68

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5.11.3. No Reduction in Liability for Obligations. No payment or payments made by a Borrower or received or collected by Agent from a Borrower or any other Person by virtue of any action or proceeding or any setoff or appropriation or application at any time or from time to time in reduction of or in payment of the Obligations shall be deemed to modify, reduce, release or otherwise affect the liability of any Borrower under this Agreement, each of whom shall remain jointly and severally liable for the payment and performance of all Loans and other Obligations until Full Payment of the Obligations and termination of this Agreement. 5.11.4. Contribution. Each Borrower is unconditionally obligated to repay the Obligations as a joint and several obligor under this Agreement. If, as of any date, the aggregate amount of payments made by a Borrower on account of the Obligations and proceeds of such Borrower’s Collateral that are applied to the Obligations exceeds the aggregate amount of Loan proceeds actually used by such Borrower in its business (such excess amount being referred to as an “Accommodation Payment”), then each of the other Borrowers (each such Borrower being referred to as a “Contributing Borrower”) shall be obligated to make contribution to such Borrower (the “Paying Borrower”) in an amount equal to (A) the product derived by multiplying the sum of each Accommodation Payment of each Borrower by the Allocable Percentage of the Borrower from whom contribution is sought less (B) the amount, if any, of the then outstanding Accommodation Payment of such Contributing Borrower (such last mentioned amount which is to be subtracted from the aforesaid product to be increased by any amounts theretofore paid by such Contributing Borrower by way of contribution hereunder, and to be decreased by any amounts theretofore received by such Contributing Borrower by way of contribution hereunder); provided, however, that a Paying Borrower’s recovery of contribution hereunder from the other Borrowers shall be limited to that amount paid by the Paying Borrower in excess of its Allocable Percentage of all Accommodation Payments then outstanding of all Borrowers. As used herein, the term “Allocable Percentage” shall mean, on any date of determination thereof, a fraction the denominator of which shall be equal to the number of Borrowers who are parties to this Agreement on such date and the numerator of which shall be 1; provided, however, that such percentages shall be modified in the event that contribution from a Borrower is not possible by reason of insolvency, bankruptcy or otherwise by reducing such Borrower’s Allocable Percentage equitably and by adjusting the Allocable Percentage of the other Borrowers proportionately so that the Allocable Percentages of all Borrowers at all times equals 100%. 5.11.5. Subordination. Each Borrower hereby subordinates any claims, including any right of payment, subrogation, contribution and indemnity, that it may have from or against any other Borrower, and any successor or assign of any other Borrower, including any trustee, receiver or debtor-in-possession, howsoever arising, due or owing or whether heretofore, now or hereafter existing, to the Full Payment of all of the Obligations. SECTION 6.

TERM AND TERMINATION OF COMMITMENTS

6.1. Term of Commitments. Subject to each Lender’s right to cease making Loans and other extensions of credit to Borrowers when any Default or Event of Default exists or upon termination of the Revolver Commitments as provided in Section 6.2, the Revolver Commitments shall be in effect for a period (the “Term”) commencing on the Closing Date, through July 2, 2017; provided, however, to the extent that any extension is requested by the 69

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Borrowers, the Agent and Lenders may consult with Borrowers; provided, further, that nothing herein shall require the Agent or Lenders to agree to any extension or modification of the terms of this Agreement, and extension or modification must be in writing signed by all parties. 6.2.

Termination.

6.2.1. Termination by Agent. Agent may (and upon the direction of the Required Lenders, shall) terminate the Revolver Commitments without notice at any time that an Event of Default exists; provided, however, that the Revolver Commitments shall automatically terminate as provided in Section 12.2. 6.2.2. Termination by Borrowers. Upon at least three (3) Business Daysâ&#x20AC;&#x2122; prior written notice to Agent, Borrowers may, at their option, terminate the Revolver Commitments; provided, however, no such termination by Borrowers shall be effective until Full Payment of the Obligations and Full Payment (as defined in the Prepetition Senior Loan Agreement) of the Prepetition Senior Obligations. Any notice of termination given by Borrowers shall be irrevocable unless Agent otherwise agrees in writing under this Section 6.2.2. Borrowers may elect to terminate the Revolver Commitments in their entirety only. No section of this Agreement or any Loan available hereunder or Revolver Commitment may be terminated by Borrowers singly. 6.2.3.

Reserved.

6.2.4. Effect of Termination. On the effective date of termination of the Revolver Commitments by Agent or by Borrowers, all of the Obligations shall be immediately due and payable and Lenders shall have no obligation to make any Loans, Issuing Bank shall have no obligation to issue any Letters of Credit and Bank Product Providers may terminate any Bank Products (including any services or products under Cash Management Agreements). All undertakings, agreements, covenants, warranties and representations of Borrowers contained in the Loan Documents shall survive any such termination and Agent shall retain its Liens in the Collateral and all of its rights and remedies under the Loan Documents notwithstanding such termination until Full Payment of the Obligations and Full Payment (as defined in the Prepetition Senior Loan Agreement) of the Prepetition Senior Obligations. Notwithstanding the Full Payment of the Obligations and Full Payment (as defined in the Prepetition Senior Loan Agreement) of the Prepetition Senior Obligations, Agent shall not be required to terminate its Liens in any of the Collateral unless, with respect to any loss or damage Agent may incur as a result of the dishonor or return of any Payment Items applied to the Obligations, Agent shall have received either (i) a written agreement, executed by Borrowers and any Person deemed financially responsible by Agent whose loans or other advances to Borrowers are used in whole or in part to satisfy the Obligations, indemnifying Agent and Lenders from any such loss or damage; or (ii) such monetary reserves and Liens on the Collateral for such period of time as Agent, in its reasonable discretion, may deem necessary to protect Agent from any such loss or damage. The provisions of Sections 3.4, 3.7, 3.8, 3.10, 5.5, 5.9 and this Section 6.2.4 and all obligations of Borrowers to indemnify Agent or any Lender pursuant to this Agreement or any of the other Loan Documents, shall in all events survive any termination of the Revolver 70

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Commitments and Full Payment of the Obligations and Full Payment (as defined in the Prepetition Senior Loan Agreement) of the Prepetition Senior Obligations. SECTION 7.

COLLATERAL

7.1. Grant of Security Interest. To secure the prompt payment and performance of all of the Obligations, and, to the extent provided in the DIP Order, the Prepetition Senior Obligations, each Borrower hereby grants to Agent, for the benefit of the Secured Parties, a continuing security interest in and Lien upon all personal property of such Borrower, including, without limitation, all Postpetition Collateral (as defined in the DIP Order), and all of the following Property and interests in Property of such Borrower, whether now owned or existing or hereafter created, acquired or arising and wheresoever located: (i) all Accounts; (ii) all Supporting Obligations; (iii) all Goods, including all Inventory and Equipment (including Fixtures); (iv) all Instruments; (v) all Chattel Paper (including all Electronic Chattel Paper); (vi) all Documents; (vii) all General Intangibles (including Payment Intangibles and Software); (viii) all Deposit Accounts; (ix) all Investment Property (but excluding any portion thereof that constitutes Margin Stock unless otherwise expressly provided in any Security Documents); (x) all Letter-of-Credit Rights; (xi) all monies now or at any time or times hereafter in the possession or under the control of Agent or a Lender or a bailee or Affiliate of Agent or a Lender, including any Cash Collateral in the Cash Collateral Account; (xii) all Intellectual Property in which any Borrower has an interest, (xiii) all accessions to, substitutions for and all replacements, products and cash and non-cash proceeds of (i) through (xii) above, including proceeds of and unearned premiums with respect to insurance policies insuring any of the Collateral and claims against any Person for loss of, damage to or destruction of any of the Collateral; and (xiv) all books and records (including customer lists, files, correspondence, tapes, computer programs, print-outs, and other computer materials and records) of such Borrower pertaining to any of (i) through (xiii) above. 7.2. Real Estate Collateral. The due and punctual payment and performance of the Obligations shall also be secured by the Lien created by the DIP Order upon all Real Estate of each Borrower. 7.3.

Other Collateral.

7.3.1. Cash Collateral. In addition to the items of Property referred to in Section 7.1 above, the Obligations shall also be secured by the Cash Collateral to the extent provided herein and all of the other items of Property from time to time described in any of the Security Documents as security for any of the Obligations. 7.3.2. Commercial Tort Claims. Borrowers shall promptly notify Agent in writing upon any Borrowerâ&#x20AC;&#x2122;s obtaining a Commercial Tort Claim in an amount exceeding $500,000 after the Closing Date against any Person, but regardless of the dollar amount of such Commercial Tort Claim, at Agentâ&#x20AC;&#x2122;s written reasonable request, Borrowers shall promptly enter into an amendment to this Agreement (or any of the other Loan Documents) and do such other acts or things deemed appropriate by Agent to confer upon Agent a first priority perfected security interest in each such Commercial Tort Claim. 71

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7.3.3. Certain After-Acquired Collateral. Borrowers shall promptly notify Agent in writing upon any Borrower’s obtaining any Collateral after the Closing Date consisting of Deposit Accounts, Investment Property, Letter-of-Credit Rights or Electronic Chattel Paper and, upon Agent’s request, shall promptly execute such documents and do such other acts or things deemed appropriate by Agent to confer upon Agent control with respect to such Collateral; promptly notify Agent in writing upon any Borrower’s obtaining any Collateral after the Closing Date consisting of Documents or Instruments in an amount exceeding $500,000 but regardless of the dollar amount, upon Agent’s reasonable request, Borrowers shall promptly execute such documents and do such other acts or things deemed appropriate by Agent to deliver to it possession of such Documents as are negotiable and Instruments, and, with respect to nonnegotiable Documents, to have such non-negotiable Documents issued in the name of Agent; and if reasonably requested by Agent, with respect to Collateral in the possession of a third party, other than certificated securities, Excluded Deposit Accounts and Goods covered by a Document, such Borrower shall obtain an acknowledgment from the third party that is in possession of such Collateral that such third party holds the Collateral for the benefit of Agent and if such Borrower fails to obtain such acknowledgement, then any Collateral at such location shall be deemed ineligible for borrowing purposes under this Agreement or Agent may establish an Availability Reserve with respect thereto. 7.4. No Assumption of Liability. The security interests granted pursuant to this Agreement and the other Loan Documents are granted as security only and shall not subject Agent or any Lender to, or in any way alter or modify, any obligation or liability of Borrowers with respect to or arising out of the Collateral. 7.5. Lien Perfection; Further Assurances. The Liens granted to Agent pursuant to the provisions of this Agreement and the other Loan Documents shall be in addition to all Liens conferred upon Agent pursuant to the terms of the DIP Order. The Interim Order, and, if and when it becomes effective, the Final Order, shall be sufficient and conclusive evidence of the validity, perfection and priorities of Agent’s Liens upon the Collateral, without the necessity of filing or recording any financing statement, assignment, mortgage, deed of trust, preferred mortgages (formerly known as preferred ship mortgages) or other instrument or document which may otherwise be required under the law of any jurisdiction or the taking of any other action to validate or perfect the Liens of Agent in and to the Collateral or to entitle Agent to the priorities granted herein; provided, however, that each Borrower shall, promptly following the request of Agent, execute such instruments, assignments, mortgages, deeds of trust, ship mortgages, or documents as are necessary to perfect Agent’s liens upon any of the Collateral and shall take such other action as may be required to perfect or to continue the perfection of the Agent’s Liens upon the Collateral. Each Borrower hereby irrevocably authorizes Agent at any time and from time to time to file in any UCC jurisdiction any initial financing statements and amendments thereto that (a) indicate the Collateral (i) as “all assets” of such Borrower or words of similar effect, regardless of whether any particular asset comprised in the Collateral falls within the scope of Article 9 of the UCC of the State of New York or such jurisdiction, or (ii) as being of an equal or lesser scope or with greater detail, and (b) contain any other information required by part 5 of Article 9 of the UCC of the State of such Borrower’s location for the sufficiency or filing office acceptance of any financing statement or amendment, including (i) whether such Borrower is an organization, the type of organization and any organization identification number 72

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issued to such Borrower, and, (ii) in the case of a financing statement filed as a fixture filing or indicating Collateral as as-extracted collateral or timber to be cut, a sufficient description of real property to which the Collateral relates. Each Borrower agrees to furnish any such information to Agent promptly upon request. Each Borrower also ratifies its authorization for Agent to have filed in any UCC jurisdiction any like initial financing statements or amendments thereto if filed prior to the date hereof. No such filing or recordation shall be necessary or required in order to create or perfect any such Lien. The parties agree that a carbon, photographic or other reproduction of this Agreement shall be sufficient as a financing statement and may be filed in any appropriate office in lieu thereof. At the Agentâ&#x20AC;&#x2122;s request, each Borrower shall also promptly execute or cause to be executed and shall deliver to Agent any and all documents, instruments and agreements deemed necessary by Agent to give effect to or carry out the terms or intent of the Loan Documents. 7.6. SECTION 8. 8.1.

[Reserved]. COLLATERAL ADMINISTRATION General Provisions.

8.1.1. Location of Collateral. All tangible items of Collateral, other than Inventory in transit, shall at all times be kept by Borrowers at one or more of the business locations of Borrowers set forth in Schedule 8.1.1 hereto and shall not be moved therefrom (other than in the Ordinary Course of Business within the continental United States), without the prior written approval of Agent (such approval not to be unreasonably withheld or delayed), except that in the absence of an Event of Default and acceleration of the maturity of the Obligations in consequence thereof, Borrowers may (i) make sales or other dispositions of any Collateral to the extent authorized by Section 10.2.10 and (ii) move Equipment to a location in the United States other than those shown on Schedule 8.1.1 hereto so long as Borrowers have given Agent at least 30 days prior written notice of such new location. Notwithstanding anything to the contrary contained in this Agreement, Borrowers shall not be permitted to keep, store or otherwise maintain any Collateral at any location (including any location described in Section 8.1.1), unless (i) a Borrower is the owner of such location, or (ii) a Borrower leases such location and the landlord has executed in favor of Agent a Lien Waiver or if determined by Agent, Agent has established a Rent Reserve with respect thereto, or (iii) the Collateral consists of Inventory placed with a warehouseman, bailee or processor, Agent has received from such warehouseman, bailee or processor an acceptable Lien Waiver (or if determined by Agent, Agent has established a Rent Reserve with respect thereto or made such Collateral ineligible for borrowing purposes hereunder), or (iv) the Collateral is in transit in the Ordinary Course of Business in the continental United States or is at a customer location in the Ordinary Course of Business. 8.1.2. Insurance of Collateral; Condemnation Proceeds. Each Borrower shall maintain and pay for insurance upon all Collateral, wherever located, covering casualty, hazard, public liability, theft, malicious mischief, and such other risks in such amounts in accordance with Section 10.1.7. Schedule 8.1.2 describes all insurance of Borrowers in effect on the date hereof. All proceeds payable under each such policy shall be payable to Agent for application to the Obligations and the Prepetition Senior Obligations as provided in the DIP Order and Section 73

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5.2 of the Prepetition Intercreditor Agreement. Borrowers shall deliver the originals or certified copies of such policies to Agent with satisfactory lender’s loss payable endorsements reasonably satisfactory to Agent naming Agent as sole lender’s loss payee, assignee or additional insured, as appropriate (it being agreed that such copies of such policies and lender’s loss payable endorsements delivered to Prepetition Senior Agent pursuant to the Prepetition Senior Loan Agreement shall be deemed acceptable unless and until Agent, acting in its Permitted Discretion, notifies Borrower Agent that such copies of such policies and lender’s loss payable endorsements are no longer acceptable). Each policy of insurance or endorsement shall contain a clause requiring the insurer to give not less than 30 days prior written notice to Agent in the event of cancellation of the policy for any reason whatsoever and a clause specifying that the interest of Agent shall not be impaired or invalidated by any act or neglect of any Borrower or the owner of the Property or by the occupation of the premises for purposes more hazardous than are permitted by said policy. If any Borrower fails to provide and pay for such insurance, Agent may, at its option, but shall not be required to, procure the same and charge Borrowers therefor. At Agent’s request, each Borrower agrees to deliver to Agent, promptly as rendered, true copies of all reports made in any reporting forms to insurance companies. For so long as no Event of Default exists, each Borrower shall have the right to settle, adjust and compromise any claim with respect to any insurance maintained by such Borrower provided, that, all proceeds thereof are applied in the manner specified in this Agreement, and Agent agrees promptly to provide any necessary endorsement to any checks or drafts issued in payment of any such claim. At any time that an Event of Default exists, only Agent shall be authorized to settle, adjust and compromise such claims, and Agent will use reasonable efforts to notify Borrower Agent that Agent is asserting its right to settle, adjust or compromise such claims but Agent’s failure to do so shall not limit the authority of Agent only to undertake such settlement actions. Agent shall have all rights and remedies with respect to such policies of insurance as are provided for in this Agreement and the other Loan Documents. 8.1.3. Protection of Collateral. All expenses of protecting, storing, warehousing, insuring, handling, maintaining and shipping any Collateral, all Taxes imposed under any Applicable Law on any of the Collateral or in respect of the sale thereof, and all other payments required to be made by Agent to any Person to realize upon any Collateral shall be borne and paid by Borrowers. Agent shall not be liable or responsible in any way for the safekeeping of any of the Collateral or for any loss or damage thereto (except for reasonable care in the custody thereof while any Collateral is in Agent’s actual possession) or for any diminution in the value thereof, or for any act or default of any warehouseman, carrier, forwarding agency, or other Person whomsoever, but the same shall be at Borrowers’ sole risk. 8.2.

Administration of Accounts.

8.2.1. Records and Schedules of Accounts. Each Borrower shall keep accurate and complete records of its Accounts and all payments and collections thereon. Each Borrower shall provide to Agent (A) on Thursday of each week, (i) a detailed summary aging, by total, of all Accounts of Borrowers existing as of the last day of the preceding fiscal month, together with a reconciliation and supporting documentation for any reconciling items noted, (ii) a detailed summary aged trial balance of all Accounts of Borrowers existing as of the last day of the preceding fiscal month, specifying the names, face value and dates of invoices for each Account 74

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Debtor obligated on an Account so listed (“Schedule of Accounts”), (iii) a detailed calculation of those Accounts that are not eligible for the Borrowing Base, if Borrowers and their Subsidiaries have not implemented electronic collateral reporting, and (iv) a summary aging, by vendor, of Borrowers’ and their Subsidiaries accounts payable and any book overdraft and an aging, by vendor, of any held checks; (B) on or before the 15th Business Day of each fiscal month, (i) a monthly Account roll-forward, in a format acceptable to Agent in its sole discretion, tied to the beginning and ending account receivable balances of each Borrower’s general ledger, (ii) a reconciliation of Accounts and trade accounts payable of each Borrower’s general ledger accounts to its monthly financial statements, including any book reserves related to each category, (iii) an Account roll-forward with supporting details supplied from sales journals, collection journals, credit registers and any other records, (iv) notice of all claims, offsets or disputes asserted by Account Debtors with respect to each Borrower’s Accounts, (v) [reserved], and (vi) a listing of vendors providing extended terms of greater than 75 days together with a description of such extended terms; and (C) upon Agent’s reasonable request therefor, (i) copies of invoices and a copy of all documents, including repayment histories and present status reports relating to the Accounts so scheduled, (ii) copies of invoices together with corresponding shipping and delivery documents, and credit memos together with corresponding supporting documentation, with respect to invoices and credit memos in excess of an amount determined in the sole discretion of Agent, (iii) a detailed summary of all contracts of the Borrowers which are due to expire within the next four (4) months after the date of such summary, and (iv) such other matters and information relating to the status of then existing Accounts as Agent shall reasonably request. In addition, if Accounts in an aggregate face amount in excess of $1,000,000 from any single customer cease to be Eligible Accounts in whole or in part, Borrowers shall notify Agent of such occurrence promptly (and in any event within 5 Business Days) after any Borrower’s having obtained knowledge of such occurrence and the Borrowing Base shall thereupon be adjusted to reflect such occurrence. At Agent’s reasonable request, on an annual basis (or more frequently if requested by Agent), Borrowers shall provide to Agent a listing of all Account Debtors, including their addresses and the payment terms extended. 8.2.2. Discounts, Disputes and Returns. If any Borrower grants any discounts, allowances or credits that are not shown on the face of the invoice for the Account involved, such Borrower shall report such discounts, allowances or credits, as the case may be to Agent as part of the next required Schedule of Accounts. If any amounts due and owing in excess of $250,000 have become subject to any legal proceeding between any Borrower and any Account Debtor, or if any returns are made in excess of $250,000 with respect to any Accounts owing from an Account Debtor, such Borrower shall provide Agent with written notice thereof at the time of submission of the next Schedule of Accounts, explaining in detail the reason for the dispute or return, all claims related thereto and the amount in controversy. 8.2.3. Taxes. If an Account of any Borrower includes a charge for any Taxes payable to any Governmental Authority, Agent is authorized, in its sole discretion, to pay the amount thereof to the proper taxing authority for the account of such Borrower and to charge Borrowers therefor; provided, however, that neither Agent nor Lenders shall be liable for any Taxes that may be due by Borrowers. 75

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8.2.4. Account Verification. Whether or not a Default or an Event of Default exists, Agent shall have the right at any time, in the name of Agent, any designee of Agent or any Borrower to verify the validity, amount or any other matter relating to any Accounts of such Borrower by mail, telephone, telegraph or otherwise. Borrowers shall cooperate fully with Agent in an effort to facilitate and promptly conclude any such verification process. 8.2.5. Maintenance of Dominion Account. Borrowers shall maintain, and shall obtain Bankruptcy Court approval to maintain, a Dominion Account pursuant to a lockbox or other arrangement reasonably acceptable to Agent and, in the case of such Dominion Account and lockbox arrangement, with such bank as may be selected by Borrowers and be reasonably acceptable to Agent (it being understood and agreed that the Dominion Accounts and lockbox arrangements in place with respect to the Prepetition Senior Loan Agreement as of the Petition Date are acceptable). Borrowers shall enter into or, to the extent in effect as of the Petition Date, shall maintain agreements, in form reasonably satisfactory to Agent, with each bank at which a Dominion Account is maintained by which such bank shall, at all times immediately transfer to the Agent all monies deposited to the Dominion Account. All funds deposited in each Dominion Account shall be subject to Agent’s Lien. Borrowers shall obtain the agreement (in favor of and in form and content reasonably satisfactory to Agent and Lenders) by each bank at which a Dominion Account is maintained to waive any offset rights against the funds deposited into such Dominion Account, except offset rights in respect of charges incurred in the administration of such Dominion Account. Neither Agent nor Lenders assume any responsibility to Borrowers for such lockbox arrangement or Dominion Account, including any claim of accord and satisfaction or release with respect to deposits accepted by any bank thereunder. 8.2.6. Collection of Accounts and Collateral Proceeds. To expedite collection of Accounts, each Borrower shall endeavor in the first instance to make collection of such Borrower’s Accounts for Agent and Lenders. Borrowers shall deposit and cause its Subsidiaries to deposit or cause to be deposited promptly, and in any event no later than the first Business Day after the date of receipt thereof, all cash or Payment Items, in respect of any Collateral (whether or not otherwise delivered to a lockbox) into the Dominion Account. Borrowers shall issue to each such lockbox bank an irrevocable letter of instruction directing such bank to deposit all payments or other remittances received in the lockbox to the Dominion Account. All Payment Items received by a Borrower in respect of its Accounts, together with the proceeds of any other Collateral, shall be held by such Borrower as trustee of an express trust for Agent’s, each Lenders’, Prepetition Senior Agent’s, and each Prepetition Senior Lender’s benefit; such Borrower shall immediately deposit same in kind in the Dominion Account; and Agent may remit such proceeds to Prepetition Senior Agent, Prepetition Senior Secured Parties, and Lenders for application to the Obligations in the manner authorized by the DIP Order and this Agreement. Agent retains the right at all times that an Event of Default exists to notify Account Debtors of any Borrower that Accounts have been assigned to Agent and to collect Accounts directly in its own name and to charge to Borrowers the collection costs and expenses incurred by Agent, including reasonable attorneys’ fees. At any time an Event of Default exists, subject to the DIP Order, Agent shall have the right to settle or adjust all disputes as to Claims directly with the Account Debtor and to compromise the amount or extend the time for payment of any Account upon such terms and conditions as Agent may deem advisable, and to charge the deficiencies, costs and expenses thereof, including attorneys’ fees to Borrowers. 76

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Administration of Inventory.

8.3.1. Records and Reports of Inventory. Each Borrower shall keep accurate and complete records of its Inventory (including records showing the cost thereof and daily withdrawals therefrom and additions thereto) and shall furnish to Agent (A) on a monthly basis, no later than the 15th Business Day of each fiscal month, (i) Inventory system/perpetual reports specifying the cost and the wholesale market value of Borrowers’ and their Subsidiaries’ warehouse Inventory, by category, together with a summary of Inventory by location (including in-transit Inventory) with additional detail showing additions to and deletions therefrom, (ii) a linen detail report including such information as Agent reasonably requests, (iii) a detailed Inventory system/perpetual report together with a reconciliation to Borrowers’ general ledger accounts, (iv) a detailed calculation of Inventory categories that are not eligible for the Borrowing Base, if Borrowers have not implemented electronic reporting, and (v) a reconciliation of Inventory of each Borrowers’ general ledger accounts to its monthly financial statements including any book reserves related to each category, (B) on Thursday of each week, (i) a linen detail report including such information as Agent reasonably requests, (ii) Inventory system/perpetual reports specifying the cost and the wholesale market value of Borrowers’ and their Subsidiaries’ warehouse Inventory, by category, together with a summary of Inventory by location (including in-transit Inventory) with additional detail showing additions to and deletions therefrom and (iii) a detailed calculation of Inventory categories that are not eligible for the Borrowing Base, if Borrowers have not implemented electronic reporting, and (C) upon request by Agent, copies of purchase orders and invoices for Inventory acquired by Borrowers or their Subsidiaries. 8.3.2. Returns of Inventory. No Borrower shall return any of its Inventory to a supplier or vendor thereof, or any other Person, whether for cash, credit against future purchases or then existing payables, or otherwise, unless (i) such return is in the Ordinary Course of Business of such Borrower and such Person; (ii) the return of such Inventory will not result in an Out-of-Formula Condition; (iii) such Borrower promptly notifies Agent thereof if the aggregate Value of all Inventory returned in any month exceeds $250,000; and (iv) any payments received by such Borrower in connection with any such return are promptly deposited in the Dominion Account. 8.3.3. Acquisitions and Sale of Inventory. No Borrower shall acquire or accept any Inventory on consignment or approval and will use its commercially reasonable efforts to insure that all Inventory that is produced in the United States of America will be produced in accordance with the FLSA, provided, that, the Borrower may consign Inventory with a value not to exceed $100,000 at any one time. No Borrower shall sell any Inventory to any customer on approval or any other basis upon which the customer has a right to return or obligates any Borrower to repurchase such Inventory. 8.3.4. Maintenance of Inventory. Borrowers shall produce, use, store and maintain all Inventory with all reasonable care and caution in accordance with applicable standards of any insurance and in conformity with Applicable Law (including the requirements of the FLSA) and will maintain current rent payments (within applicable grace periods provided for in leases) at all locations at which any Inventory is maintained or stored. 77

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Administration of Equipment.

8.4.1. Records and Schedules of Equipment. Each Borrower shall keep accurate records itemizing and describing the kind, type, quality, quantity and cost of its Equipment and all dispositions made in accordance with Section 8.4.2, and shall furnish Agent with a current schedule containing the foregoing information upon Agentâ&#x20AC;&#x2122;s reasonable request. 8.4.2. Dispositions of Equipment. No Borrower shall sell, lease or otherwise dispose of or transfer any of the Equipment or any part thereof, whether in a single transaction or a series of related transactions, without the prior written consent of Agent (acting at the direction of the Required Lenders), other than a disposition of Equipment that qualifies as a Permitted Asset Disposition. 8.4.3. Condition of Equipment. The Equipment is in good operating condition and repair, and all necessary replacements of and repairs thereto shall be made so that the value and operating efficiency of the Equipment shall be maintained and preserved, reasonable wear and tear excepted. Each Borrower shall ensure that the Equipment shall be mechanically and structurally sound, capable of performing the functions for which the Equipment was originally designed, in accordance with the manufacturerâ&#x20AC;&#x2122;s published and recommended specifications. No Borrower will permit any of the Equipment to become affixed to any real Property leased to such Borrower so that an interest arises therein under Applicable Law unless the landlord of such real Property has executed a Lien Waiver in favor of and in form reasonably acceptable to Agent, and no Borrower will permit any of the Equipment to become an accession to any personal Property that is subject to a Lien unless the Lien is a Permitted Lien. 8.5. Borrowing Base Certificates. On or before Thursday of each week, and on or before the 15th Business Day after the end of each fiscal month after the Closing Date, Borrowers shall deliver to Agent (and Agent shall promptly deliver to Lenders) a Borrowing Base Certificate prepared as of the close of business of the previous month or week, as applicable. All calculations of Availability in connection with any Borrowing Base Certificate shall originally be made by Borrowers and certified by a Senior Officer to Agent, provided, that, Agent shall have the right to review and adjust, in the exercise of its Permitted Discretion, any such calculation to the extent that such calculation is not in accordance with this Agreement or does not accurately reflect the amount of the Availability Reserve. In no event shall the Borrowing Base on any date be deemed to exceed the amount of the Borrowing Base shown on the Borrowing Base Certificate last received by Agent prior to such date, as the calculation in such Borrowing Base Certificate may be adjusted from time to time by Agent as herein authorized. Notwithstanding anything contained herein, in connection with only such Borrowing Base Certificate delivered for the last fiscal month of each Fiscal Year, the information required pursuant to Section 8.2.1(iv) for inclusion in such Borrowing Base Certificate at the time of delivery thereof as required pursuant to this Section 8.5 may be in draft format in accordance with Section 8.2.1.

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SECTION 9.

REPRESENTATIONS AND WARRANTIES

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9.1. General Representations and Warranties. To induce Agent and Lenders to enter into this Agreement and to make available the Revolver Commitments, each Borrower warrants and represents to Agent and Lenders that: 9.1.1. Organization and Qualification. Each Borrower and each of its Subsidiaries is an entity duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization. Each Borrower and each of its Subsidiaries is duly qualified and is authorized to do business and is in good standing as a foreign corporation in each state or jurisdiction listed on Schedule 9.1.1 hereto and in all other states and jurisdictions in which the failure of such Borrower or any of such Subsidiaries to be so qualified would have a Material Adverse Effect. 9.1.2. Power and Authority. Each Borrower and each of its Subsidiaries is duly authorized and empowered to enter into, execute, deliver and perform this Agreement and each of the other Loan Documents to which it is a party. Subject to entry of the DIP Order, the execution, delivery and performance of this Agreement and each of the other Loan Documents have been duly authorized by all necessary action and do not and will not (i) require any consent or approval of any of the holders of the Equity Interests of any Borrower or any of its Subsidiaries other than those obtained on or prior to the date hereof; (ii) contravene the Organic Documents of any Borrower or any of its Subsidiaries; (iii) violate, or cause any Borrower or any of its Subsidiaries to be in default under, any provision of any Applicable Law; (iv) result in a breach of or constitute a default under any Material Contract or under any indenture or loan or credit agreement for Money Borrowed; or (v) result in, or require, the creation or imposition of any Lien (other than Permitted Liens) upon or with respect to any of the Properties now owned or hereafter acquired by any Borrower or any of its Subsidiaries. 9.1.3. Legally Enforceable Agreement. Subject to entry of the DIP Order, this Agreement is, and each of the other Loan Documents when delivered under this Agreement will be, a legal, valid and binding obligation of each Borrower and each of its Subsidiaries signatories thereto enforceable against them in accordance with the respective terms of such Loan Documents, except as the enforceability thereof may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditorsâ&#x20AC;&#x2122; rights generally. 9.1.4. Capital Structure. As of the date hereof, Schedule 9.1.4 hereto states (i) the correct name of each Borrower, its jurisdiction of incorporation and the percentage of its Equity Interests having voting powers owned by each Person, (ii) the name of each Borrowerâ&#x20AC;&#x2122;s corporate Affiliates and the nature of the affiliation and (iii) the number of authorized and issued Equity Interests (and treasury shares) of each Borrower and its Subsidiaries. Each Borrower has good title to all of the shares it purports to own of the Equity Interests of each of its Subsidiaries, free and clear in each case of any Lien other than Permitted Liens. All such Equity Interests have been duly issued and are fully paid and non-assessable. Since the date of the financial statements of Borrowers referred to in Section 9.1.9, Borrowers have not made, or obligated itself to make, any Distribution other than Distributions permitted by Section 10.2.7. Except as set forth on Schedule 9.1.4 hereto, on the Closing Date there are no outstanding agreements or 79

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instruments binding upon the holders of any Borrowerâ&#x20AC;&#x2122;s Equity Interests relating to the ownership of its Equity Interests. 9.1.5. Corporate Names. During the 5-year period preceding the date of this Agreement, no Borrower nor any of its Subsidiaries has been known as or used any corporate, fictitious or trade names except those listed on Schedule 9.1.5 hereto. Except as otherwise set forth on Schedule 9.1.5, as of the Closing Date no Borrower nor any of its Subsidiaries has been the surviving corporation of a merger or consolidation or acquired all or substantially all of the assets of any Person. 9.1.6. Business Locations; Agent for Process. As of the date hereof, the chief executive office and other places of business of each Borrower and its Subsidiaries are as listed on Schedule 8.1.1 hereto. During the 5-year period preceding the date of this Agreement, no Borrower nor any of its Subsidiaries has had an office, place of business or agent for service of process other than as listed on Schedule 8.1.1. Except as shown on Schedule 8.1.1 on the date hereof, no Inventory of any Borrower or any of its Subsidiaries is stored with a bailee, warehouseman or similar Person, nor is any Inventory consigned to any Person. 9.1.7. Title to Properties; Priority of Liens. Each Borrower and each of its Subsidiaries has good and marketable title to and fee simple ownership of, or valid and subsisting leasehold interests in, all of its real Property, and good title to all of its personal Property, including all Property reflected in the financial statements referred to in Section 9.1.9 or delivered pursuant to Section 10.1.3, in each case free and clear of all Liens except Permitted Liens, other than Property disposed of in accordance with this Agreement after the Closing Date. Each Borrower has paid or discharged, and has caused each of its Subsidiaries to pay and discharge, all lawful claims which, if unpaid, might become a Lien against any Properties of such Borrower or any such Subsidiary that is not a Permitted Lien. As of the Petition Date by entry of the DIP Order, the Liens granted to Agent pursuant to this Agreement and the other Security Documents are validly created, duly perfected, first priority Liens, subject only to those Permitted Liens that are expressly permitted by the terms of this Agreement to have priority over the Liens of Agent. 9.1.8. Accounts. Agent may rely, in determining which Accounts are Eligible Accounts, on all statements and representations made by Borrowers with respect to any Account. Unless otherwise indicated in writing to Agent or excluded by Borrowers in their calculation of the Borrowing Base in any Borrowing Base Certificate, with respect to each Account, each Borrower warrants that: (i) it is genuine and in all respects what it purports to be, and it is not evidenced by a judgment; (ii) it arises out of a completed, bona fide sale and delivery of goods or rendition of services by a Borrower in the Ordinary Course of Business and substantially in accordance with the terms and conditions of all purchase orders, contracts or other documents relating thereto and forming a part of the contract between a Borrower and the Account Debtor; (iii) it is for a sum certain maturing as stated in the duplicate invoice covering such sale or rendition of services, a copy of which has been furnished or is available to Agent on request; (iv) such Account, and Agentâ&#x20AC;&#x2122;s security interest therein, is not, and will not (by voluntary act or omission of a Borrower) be in the future, subject to any offset, Lien (other than a Permitted Lien), deduction, defense, dispute, counterclaim or any other adverse condition except for 80

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disputes where the amount in controversy is reasonably deemed by Agent to be immaterial, and each such Account is absolutely owing to a Borrower and is not contingent in any respect or for any reason; (v) the contract under which such Account arose does not condition or restrict a Borrower’s right to assign to Agent the right to payment thereunder unless such Borrower has obtained the Account Debtor’s consent to such collateral assignment or complied with any conditions to such assignment (regardless of whether under the UCC or other Applicable Law any such restrictions are ineffective to prevent the grant of a Lien upon such Account in favor of Agent); (vi) such Borrower has not made any agreement with any Account Debtor thereunder for any extension, compromise, settlement or modification of any such Account or any deduction therefrom, except discounts or allowances which are granted by a Borrower in the Ordinary Course of Business for prompt payment and which are reflected in the calculation of the net amount of each respective invoice related thereto and are reflected in the Schedules of Accounts submitted to Agent pursuant to Section 8.2.1; (vii) to the best of such Borrower’s knowledge, there are no facts, events or occurrences which are reasonably likely to impair the validity or enforceability of such Account or reduce the amount payable thereunder from the face amount of the invoice and statements delivered to Agent with respect thereto; and (viii) to the best of such Borrower’s knowledge, the Account Debtor thereunder (1) had the capacity to contract at the time any contract or other document giving rise to the Account was executed and (2) is Solvent. 9.1.9. Financial Statements; Fiscal Year. The Consolidated balance sheets of Borrowers and such other Persons described therein (including the accounts of all Subsidiaries of Holdings for the respective periods during which a Subsidiary relationship existed) most recently provided to Prepetition Senior Agent under the Prepetition Senior Loan Agreement and the related statements of income, changes in stockholder’s equity, and changes in financial position for the periods ended on such dates, have been prepared in accordance with GAAP, and present fairly in all material respects the financial positions of Borrowers and such Persons at such dates and the results of Borrowers’ operations for such periods. Since the date of the Consolidated balance sheets of Borrowers and such other Persons described therein most recently provided to Prepetition Senior Agent under the Prepetition Senior Loan Agreement, there has been no event related to Holdings and its Subsidiaries that, taken as a whole, has had or would reasonably be expected to have a Material Adverse Effect. 9.1.10. Full Disclosure. The financial statements referred to in Section 9.1.9 do not contain any untrue statement of a material fact and neither this Agreement nor any other written statement taken as a whole contains or omits any material fact necessary to make the statements contained herein or therein not materially misleading. 9.1.11.

Administrative Priority; Lien Priority.

(i) Subject to entry of, and to the extent permitted in the DIP Orders, the Obligations will constitute an allowed administrative expense in the Chapter 11 Cases, having priority in payment over all other administrative expenses and claims against the Borrowers now existing or hereafter arising, of any kind or nature whatsoever, including without limitation all administrative expenses of the kind specified in, or arising or ordered under, Sections 105, 326, 81

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328, 503(b), 506(c), 507(a), 507(b), 546(c), 726 and 1114 of the Bankruptcy Code. (ii) Pursuant to Section 364(c)(2) of the Bankruptcy Code and subject to entry of, and to the extent provided in the DIP Order, all Obligations will be secured by a perfected Lien on the Collateral, subject to no other Lien (except as provided in the DIP Order) in any of the Collateral which is not encumbered by a Prior Lien (as defined in the DIP Order). (iii) Pursuant to Section 364(d)(1) of the Bankruptcy Code and the subject to entry of, and to the extent provided in the DIP Order, all of the Obligations will be secured by (1) a perfected Lien on the Collateral which came into existence or was acquired by any Borrower on or after the Petition Date, subject to no other Lien except as provided in the DIP Order, and (2) a perfected Lien on the Collateral which came into existence or was acquired by the Borrower prior to the Petition Date, subject to no other Lien except as provided in the DIP Order. (iv) On the Closing Date, the Interim Order is, and from and after the entry of the Final Order, the Final Order will be, in full force and effect, and neither the Interim Order nor the Final Order has been reversed, vacated, modified, amended or stayed, except for modifications and amendments that are reasonably acceptable to Agent and Lenders and are not stayed in any respect. 9.1.12. Surety Obligations. Except as set forth on Schedule 9.1.12 on the date hereof or in the Ordinary Course of Business of an Borrower or any of its Subsidiaries, no Borrower nor any of its Subsidiaries is obligated as surety or indemnitor under any surety or similar bond or other contract issued or has entered into any agreement to assure payment, performance or completion of performance of any undertaking or obligation of any Person, in each case, in an amount in excess of $2,000,000. 9.1.13. Taxes. The FEIN of each of each Borrower and each of its Subsidiaries is as shown on Schedule 9.1.13. Each Borrower and each of its Subsidiaries has filed all federal, state and local tax returns and other reports it is required by law to file and has paid, or made provision for the payment of, all Taxes upon it, its income and Properties as and when such Taxes are due and payable, except (i) to the extent being Properly Contested or (ii) Taxes which consist of interest or penalties on Pre-Petition Taxes. 9.1.14. Brokers. Except as set forth on Schedule 9.1.14 on the date hereof there are no claims against any Borrower for brokerage commissions, finderâ&#x20AC;&#x2122;s fees or investment banking fees in connection with the transactions contemplated by this Agreement or any of the other Loan Documents. 9.1.15. Intellectual Property. Each Borrower and each of its Subsidiaries each owns or has the lawful right to use all Intellectual Property necessary for the conduct of its business without resulting in any Intellectual Property Claims by others which could reasonably 82

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be expected to have a Material Adverse Effect; no Borrower has received written notice of any Intellectual Property Claims and there are no pending (or to any Borrowerâ&#x20AC;&#x2122;s knowledge, threatened) Intellectual Property Claims or any grounds for such Intellectual Property Claims which could reasonably be expected to have a Material Adverse Effect. 9.1.16. Governmental Approvals. Each Borrower and each of its Subsidiaries has, and is in good standing with respect to, all Governmental Approvals for the conduct its business as heretofore or proposed to be conducted by it and to own or lease and operate its Properties as now owned or leased by it, except to the extent any such failure to have or be in good standing could not reasonably be expected to have a Material Adverse Effect. 9.1.17. Compliance with Laws. Each Borrower and each of its Subsidiaries has duly complied with, and its Properties, business operations and leaseholds are in compliance in all material respects with, the provisions of all Applicable Law (except to the extent that any such noncompliance with Applicable Law could not reasonably be expected to have a Material Adverse Effect). 9.1.18. Burdensome Contracts. On the Closing Date, no Borrower nor any of its Subsidiaries is a party or subject to any contract, agreement, or charter or other corporate restriction, which has or could be reasonably expected to have a Material Adverse Effect. On the Closing Date, no Borrower nor any of its Subsidiaries is a party or subject to any Restrictive Agreements, except as set forth on Schedule 9.1.18, none of which prohibit the execution or delivery of any of the Loan Documents by any Borrower or the performance by any Borrower of its obligations under any of the Loan Documents to which it is a party, in accordance with the terms of such Loan Documents. 9.1.19. Litigation. Except as set forth on Schedule 9.1.19, and the filing of the Chapter 11 Cases, there are no actions, suits, proceedings or investigations pending or, to the knowledge of any Borrower, threatened in writing on the date hereof against or affecting any Borrower or any of its Subsidiaries, or the business, operations, Properties, prospects, profits or condition of any Borrower or any of its Subsidiaries (i) which relate to any of the Loan Documents, any of the transactions contemplated thereby, any of the Prepetition Senior Loan Documents, or any of the transactions contemplated thereby, or (ii) which are not subject to the Automatic Stay, (A) which, if determined adversely to any Borrower or any of its Subsidiaries, could reasonably be expected to cause a liability in excess of $500,000, or (B) which could reasonably be expected to have a Material Adverse Effect. 9.1.20. No Defaults. No event has occurred and no condition exists which would, upon or after the execution and delivery of this Agreement or any Borrowerâ&#x20AC;&#x2122;s performance hereunder, constitute a Default or an Event of Default. 9.1.21.

[Reserved].

9.1.22. ERISA. Except as disclosed on Schedule 9.1.22, no Borrower nor any of its Subsidiaries has any Plan on the date hereof. Each Borrower and each of its Subsidiaries is in full compliance with the requirements of ERISA and the regulations promulgated thereunder 83

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with respect to each Plan except to the extent that such non-compliance could not reasonably be expected to have a Material Adverse Effect. No fact or situation that is reasonably likely to result in a Material Adverse Effect exists in connection with any Plan. No Borrower nor any of its Subsidiaries has incurred any unsatisfied withdrawal liability in connection with a Multiemployer Plan that is reasonably likely to result in a Material Adverse Effect. 9.1.23. Trade Relations. Other than as disclosed to Agent in writing prior to the Closing Date, there exists no actual or threatened termination, cancellation or limitation of, or any materially adverse modification or change in, the business relationship between any Borrower and any customer or any group of customers whose purchases individually or in the aggregate are material to the business of such Borrower, or with any material supplier or group of suppliers, and there exists no condition or state of facts or circumstances which is reasonably likely to have a Material Adverse Effect or prevent any Borrower from conducting such business after the consummation of the transactions contemplated by this Agreement in substantially the same manner in which it has heretofore been conducted. 9.1.24.

Labor Relations. Except as described on Schedule 9.1.24:

(i) on the Closing Date no Borrower nor any of its Subsidiaries is on the date hereof a party to or bound by any collective bargaining agreement or management agreement. Other than as disclosed to Agent in writing prior to the Closing Date, there are no material grievances, disputes or controversies with any union or any other organization of any Borrower’s or any Subsidiary’s employees, or, to Holdings or any Borrower’s knowledge, any threats of strikes, work stoppages or any asserted pending demands for collective bargaining by any union or organization. (ii) the hours worked and payments made to employees of each Borrower or its Subsidiaries have not been in violation of the FLSA or any other applicable legal requirements, except to the extent such violations could not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Change. No Inventory has been produced in violation of the FLSA. 9.1.25. Not a Regulated Entity. No Borrower is (i) an “investment company” or a “person directly or indirectly controlled by or acting on behalf of an investment company” within the meaning of the Investment Company Act of 1940; or (ii) subject to regulation under the Federal Power Act, the Interstate Commerce Act, any public utilities code or any other Applicable Law regarding its authority to incur Debt. 9.1.26. Margin Stock. No Borrower nor any of its Subsidiaries is engaged, principally or as one of its important activities, in the business of extending credit for the purpose of purchasing or carrying any Margin Stock. 9.1.27.

Anti-Terrorism Laws.

(i) General. No Borrower nor any of its Subsidiaries or Affiliates is in violation of any Anti-Terrorism Law or engages in or conspires to engage in any

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transaction that evades or avoids, or has the purpose of evading or avoiding, or attempts to violate, any of the prohibitions set forth in any Anti-Terrorism Law. (ii)

Executive Order No. 13224.

(i) No Borrower nor any of its Subsidiaries or Affiliates is any of the following (each a “Blocked Person”): (1) a Person that is listed in the annex to, or is otherwise subject to the provisions of, Executive Order No. 13224; (2) a Person owned or controlled by, or acting for or on behalf of, any Person that is listed in the annex to, or is otherwise subject to the provisions of, Executive Order No. 13224; (3) a Person or entity with which any bank or other financial institution is prohibited from dealing or otherwise engaging in any transaction by any Anti-Terrorism Law; (4) a Person or entity that commits, threatens or conspires to commit or supports “terrorism” as defined in Executive Order No. 13224; (5) a Person or entity that is named as a “specially designated national” on the most current list published by the U.S. Treasury Department Office of Foreign Asset Control (“OFAC”) at its official website or any replacement website or other replacement official publication of such list; (6) a Person or entity who is affiliated with a Person or entity listed above; or (7) an agency of the government of, an organization directly or indirectly controlled by, or a Person resident in, a country on any official list maintained by OFAC. (ii) No Borrower nor any of its Subsidiaries or Affiliates (1) conducts any business or engages in making or receiving any contribution of funds, goods or services to or for the benefit of any Blocked Person, (2) has any of its assets in a Blocked Person, (3) deals in, or otherwise engages in any transaction relating to, any Property or interests in Property blocked pursuant to Executive Order No. 13224, or (4) derives any of its operating income from investments in or transactions with a Blocked Person. 9.1.28. Not the Holder of Plan Assets. No Borrower is an entity deemed to hold “plan assets” within the meaning of Section 3(42) of ERISA, 29 C.F.R. §2510.3-101, as modified by ERISA, of an “employee benefit plan” (as defined in Section 3(3) of ERISA) that is subject to Title I of ERISA or any “plan” (within the meaning of Section 4975 of the Internal Revenue Code), and neither the execution of this Agreement nor the funding of any Loans gives rise to a prohibited transaction within the meaning of Section 406 of ERISA or Section 4975 of the Code. 9.1.29. Deposit Accounts. Schedule 9.1.29 sets forth all Deposit Accounts of each Borrower on the Closing Date. 9.1.30. Environmental Matters. Except as set forth on Schedule 9.1.30 or as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, (a) to Borrowers’ knowledge, no Borrower’s nor any of its Subsidiaries’ properties or assets has ever been used by a Borrower, its Subsidiaries, or by previous owners or operators in the disposal of, or to produce, store, handle, treat, release, or transport, any Hazardous Materials, 85

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where such disposal, production, storage, handling, treatment, release or transport was in violation of any applicable Environmental Law and where the Borrower or any Subsidiary has an ongoing remedial obligation under Environmental Law, (b) to Borrowers’ knowledge, after due inquiry, no Borrower’s nor any of its Subsidiaries’ properties or assets has ever been designated or identified in any manner pursuant to any environmental protection statute as a Hazardous Materials disposal site, (c) no Borrower nor any of its Subsidiaries has received notice that a Lien arising under any Environmental Law has attached to any revenues or to any Real Estate owned or operated by a Loan Party or its Subsidiaries, and (d) no Borrower nor any of its Subsidiaries nor any of their respective facilities or operations is subject to any outstanding written order, consent decree, or settlement agreement with any Person relating to any Environmental Law or Environmental Liability that, individually or in the aggregate, could reasonably be expected to result in a Material Adverse Effect. 9.1.31. Holdings as Holding Company. Holdings does not have any consensually incurred material liabilities (other than liabilities arising under the Loan Documents), does not own any material assets (other than the stock of Borrowers) or itself engage in any operations or business, except in connection with its ownership of Borrowers and its rights and obligations under the Loan Documents or as otherwise required by law. 9.1.32. Eligible Inventory. As to each item of Inventory that is identified by any Borrower as Eligible Inventory in a Borrowing Base Certificate submitted to Agent, such Inventory is (a) of good and merchantable quality, free from material defects, and (b) not excluded as ineligible by virtue of one or more of the excluding criteria (other than Agentdiscretionary criteria) set forth in the definition of Eligible Inventory. 9.1.33. Compliance with Anti-Corruption Laws. Each Borrower acknowledges and agrees that such Borrower will not use, and will cause its Subsidiaries and Affiliates to not use, any part of the proceeds from any loan or investment, directly or indirectly: (i) to offer or make Payments to any Government Official or employee, political party, official of a political party, candidate for political office, official of any public international organization or anyone else acting in an official capacity, in order to obtain, retain or direct business or obtain any improper advantage, in violation of the United States Foreign Corrupt Practices Act of 1977 (15 USC. §§ 78dd 1 et seq.) (the “FCPA”); or (ii) to offer or make Payments or to take any other action that would constitute a violation, or implicate Agent or any Lender in a violation of, the U.K. Bribery Act 2010, and, where applicable, legislation enacted by member States and signatories implementing the OECD Convention Combating Bribery of Foreign Officials (collectively, with the FCPA and the UK Bribery Act 2010, the “Anti- Corruption Laws”). 9.1.34. Approved Budget. Borrowers have furnished the Approved Budget to Agent and Lenders. The Approved Budget is reasonable and was prepared on a reasonable basis and in good faith by Borrowers and is based on reasonable assumptions based on the best 86

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information available to Borrowers, and Borrowers are not aware of any facts or information that would lead any of them to believe that the Approved Budget is incorrect or misleading in any material respect. 9.1.35. Appointment of Trustee or Examiner; Liquidation. No order has been entered or is pending in any Chapter 11 Case (a) for the appointment of a Chapter 11 trustee, (b) for the appointment of an examiner with enlarged powers (beyond those set forth in Sections 1106(a)(3) and (4) of the Bankruptcy Code) under Sections 1104(d) and 1106(b) of the Bankruptcy Code or (c) to convert any Chapter 11 Case to a Chapter 7 case or to dismiss any Chapter 11 Case. 9.1.36. The Chapter 11 Cases. The Chapter 11 Cases were commenced by the filing of an voluntary petitions on the Petition Date. No Chapter 11 Case has been dismissed. The motion for approval of this Agreement was proper and sufficient pursuant to the Bankruptcy Code, the Bankruptcy Rules, and the Local Bankruptcy Rules of the Bankruptcy Court. 9.2. Reaffirmation and Survival of Representations and Warranties. Each representation and warranty by a Borrower contained in this Agreement and the other Loan Documents shall be deemed to be made on the Closing Date and reaffirmed by each Borrower on each day that Borrowers request or are deemed to have requested an extension of credit hereunder, except for changes in the nature of a Borrower’s or, if applicable, any Subsidiary’s business or operations that may occur after the date hereof in the Ordinary Course of Business so long as Agent has consented to such changes or such changes are not violative of any provision of this Agreement. Notwithstanding the foregoing, representations and warranties which by their terms are applicable only as of a specific date shall be deemed made only at and as of such date. All representations and warranties of Borrowers contained in this Agreement or any of the other Loan Documents shall survive the execution, delivery and acceptance thereof by Agent, Lenders and the parties thereto and the closing of the transactions described therein or related thereto. SECTION 10. COVENANTS AND CONTINUING AGREEMENTS 10.1. Affirmative Covenants. For so long as there are any Revolver Commitments outstanding and thereafter until Full Payment of the Obligations, each Borrower covenants that it shall and shall cause each Subsidiary to: 10.1.1. Visits and Inspections. Permit representatives of Agent, from time to time, as often as may be reasonably requested, but only during normal business hours and (except when an Event of Default exists) upon reasonable prior notice to a Borrower, to visit and inspect the Properties of such Borrower and each of its Subsidiaries, inspect, audit and make extracts from such Borrower’s and each Subsidiary’s books and records, and discuss with its officers, its employees and its independent accountants, such Borrower’s and each Subsidiary’s business, financial condition, business prospects and results of operations. Representatives of each Lender shall be authorized to accompany Agent on each such visit and inspection and to participate with Agent therein, but at their own expense, unless a Default or Event of Default exists. 87

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10.1.2. Notices. Notify Agent and Lenders in writing, promptly after a Borrower’s obtaining knowledge thereof, (i) of the commencement of any litigation affecting any Borrower, whether or not the claims asserted in such litigation are considered by Borrowers to be covered by insurance, and of the institution of any administrative proceeding, to the extent that such litigation or proceeding, if determined adversely to such Borrower, could reasonably be expected to cause a liability in excess of $500,000; (ii) of any material labor dispute to which any Borrower may become a party, any pending or threatened strikes or walkouts relating to any of its plants or other facilities, and the expiration of any labor contract to which it is a party or by which it is bound; (iii) of any material default by any Borrower under, or termination or nonrenewal of, any Material Contract if such default, termination or non-renewal could reasonably be expected to have a Material Adverse Effect (but nothing contained herein shall prohibit Agent from requesting information regarding any Material Contract); (iv) of the existence of any Default or Event of Default; (v) of any judgment against any Borrower in an amount exceeding $400,000; (vi) of the assertion by any Person of any Intellectual Property Claim, the adverse resolution of which could reasonably be expected to have a Material Adverse Effect; (vii) of any violation or asserted violation by any Borrower of any Applicable Law (including ERISA, OSHA, FLSA, or any Environmental Laws), the adverse resolution of which could reasonably be expected to have a Material Adverse Effect; (viii) of any Environmental Release by a Borrower or on any Property owned or occupied by a Borrower, in each case if the cost of any response, as required by applicable Environmental Law, to such release shall exceed $400,000; and (ix) of the discharge of Borrowers’ independent accountants or any withdrawal of resignation by such independent accountants from their acting in such capacity. Furthermore, Borrowers shall notify Agent promptly upon any Borrower (a) being required to file reports under Section 15(b) of the Securities Exchange Act of 1934, (b) registering securities under Section 12 of the Securities Exchange Act of 1934 or (c) filing a registration statement under the Securities Act of 1933. 10.1.3. Financial and Other Information. Keep adequate records and books of account with respect to its business activities in which proper entries are made in accordance with GAAP reflecting all its financial transactions; and cause to be prepared and furnished to Agent and Lenders the following (all to be prepared in accordance with GAAP applied on a consistent basis, unless Borrowers’ certified public accountants concur in any change therein, such change is disclosed to Agent and is consistent with GAAP: (i)

[reserved];

(ii) as soon as available, and in any event within 35 days after the end of each month hereafter (or, in the case of the last month of any Fiscal Quarter, within 45 days after the end of such month) unaudited balance sheets of Borrowers and their Subsidiaries as of the end of such month and the related unaudited Consolidated statements of income for such month and for the portion of Borrowers’ Fiscal Year then elapsed, on a Consolidated basis certified by the principal financial officer of Borrowers as prepared in accordance with GAAP and fairly presenting the Consolidated financial position and results of operations of Borrowers and their Subsidiaries for such month and period subject only to changes from audit and year-end adjustments and except that such statements need not contain notes; 88

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[reserved];

(iv) promptly after the sending or filing thereof, as the case may be, copies of any regular, periodic and special reports or registration statements or prospectuses which any Borrower files with the SEC or any Governmental Authority which may be substituted therefor, or any national securities exchange; and copies of any press releases or other statements made available by a Borrower to the public concerning material changes to or developments in the business of such Borrower; (v) upon Agent’s written request, promptly after the sending or filing thereof, copies of any annual report to be filed in accordance with ERISA in connection with each Plan (other than a Multiemployer Plan) and such other data and information (financial or otherwise) as Agent, from time to time, may reasonably request, bearing upon or related to the Collateral or any Borrower’s or Subsidiary’s financial condition or results of operations and on an annual basis or otherwise as reasonably requested by Agent potential withdrawal liability under any Plan (including any Multiemployer Plan); (vi) at Agent’s request, a list of all office locations or other places of business of any Borrower and other information relating to the Collateral or financial condition of Holdings and its Subsidiaries; (vii) concurrently with the delivery of each Borrowing Base Certificate, a report of all Accounts of Borrowers and their Subsidiaries that are past due by a period of more than 30 days with a past due balance of $100,000 or more; (viii) on or before Friday of each calendar week, a 13 week cash flow forecast in a form consistent with the 13 week cash flow forecast most recently delivered to Agent under the Prepetition Senior Loan Agreement or otherwise in a form reasonably acceptable to Agent and the Lenders; (ix) on the second Business Day of each week, a report in form and detail satisfactory to Agent and the Lenders showing (a) sales, actual cash collections and disbursements, in each case on a weekly, rolling four-week, and cumulative basis through the immediately preceding Friday, and (b) a comparison to the same periods in the Approved Budget; and (x) together with the delivery of each monthly Compliance Certificate, a schedule in form and detail as provided to Borrower’s management each month listing (a) new contracts with customers, (b) renewals of contracts with customers, and (c) nonrenewals and terminations or other losses of contracts with customers, which schedules shall provide detailed information as to any contract which provided for annual revenue in excess of $100,000. Concurrently with the delivery of the financial statements described in clause (ii) of this Section 10.1.3, or more frequently if requested by Agent during any period that an Event of Default exists, Borrowers shall cause to be prepared and furnished to Agent a Compliance Certificate executed by the chief financial officer of Borrowers. 89

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10.1.4.

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[Reserved.]

10.1.5. Taxes. Pay and discharge all Taxes in accordance with the requirements of the Bankruptcy Code to the extent permitted under the DIP Order. 10.1.6. Compliance with Laws. Comply with all Applicable Law, including ERISA, all Environmental Laws, FLSA, OSHA, Anti-Terrorism Laws and all laws, statutes, regulations and ordinances regarding the collection, payment and deposit of Taxes, and obtain and keep in force any and all Governmental Approvals necessary to the ownership of its Properties or to the conduct of its business, in each case to the extent that any such failure to comply, obtain or keep in force could be reasonably expected to have a Material Adverse Effect. Without limiting the generality of the foregoing, if any Environmental Release shall occur at or on any of the Properties of any Borrower or any of its Subsidiaries, Borrowers shall, or shall cause the applicable Borrower or Subsidiary to, act promptly and diligently to investigate and report to Agent and all appropriate Governmental Authorities the extent of, and to make appropriate remedial action to eliminate, such Environmental Release, whether or not ordered or otherwise directed to do so by any Governmental Authority. 10.1.7. Insurance. In addition to the insurance required herein with respect to the Collateral, maintain with its current insurers or with other financially sound and reputable insurers, (i) insurance with respect to its Properties and business against such casualties and contingencies of such type (including product liability, workers’ compensation, larceny, embezzlement, or other criminal misappropriation insurance) and in such amounts and with such coverages, limits and deductibles as is customary in the business of such Borrower or such Subsidiary and (ii) business interruption insurance in an amount not less than the amount of such insurance as in effect on the Closing Date. 10.1.8.

[Reserved].

10.1.9.

[Reserved].

10.1.10. [Reserved]. 10.1.11. [Reserved.] 10.1.12. [Reserved.] 10.1.13. [Reserved.] 10.1.14. Additional Information Relating to Prepetition Junior Loan Documents. Furnish Agent with such additional information as Agent shall reasonably request in order to enable Agent and Lenders to determine whether the terms, covenants, provisions and conditions of this Agreement have been complied with by Borrowers, including, without the necessity of any request by Agent, (a) as soon as practicable, and in any event at the same time as any such notice is given to Prepetition Junior Agent or Prepetition Junior Lenders, notice of any “default” or “event of default” under any Prepetition Junior Loan Document, and (b) as soon as practicable, and in any event no later than five Business Days after the date thereof, copies of all 90

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amendments, consent letters, waivers, forbearances or modifications to any Prepetition Junior Loan Document (other than any fee letter to the extent disclosure is restricted by the terms thereof), or by any Borrower or its Subsidiary to Prepetition Junior Agent or Prepetition Junior Lenders (without limiting the foregoing, Borrowers agree to notify Agent of the effective date and amount of any prepayment in connection with the Prepetition Junior Loan Documents (but in no event shall such prepayment be authorized unless otherwise expressly permitted by the Prepetition Junior Loan Documents)). 10.1.15. Use of Proceeds. Use the proceeds of this Transaction in a manner that ensures no violation of any Anti-Terrorism Law by any Person. 10.1.16. Sales Transaction Milestones. (i) Within the time periods set forth below, unless otherwise extended in the discretion of the Required Lenders, and subject to the DIP Order (including any modifications to the following schedule set forth therein), Borrowers shall achieve each of the following milestones with respect to a Sale Transaction: (a) On or before seven days after the Petition Date, Borrowers shall file an Approved Sale Motion with the Bankruptcy Court together with a committed asset purchase agreement, in form and substance acceptable to Agent and Lenders, to purchase substantially all of the assets of Borrowers from a purchaser satisfactory to Agent and Lenders (such purchaser, the “Stalking Horse Bidder”; such committed asset purchase agreement, the “Stalking Horse Bid”) in an amount at least sufficient to fully repay all obligations owed to Agent, Lenders, Prepetition Senior Agent, and Prepetition Senior Secured Parties, including, without limitation, all Prepetition Senior Obligations and all Obligations, in cash at closing, signed by the Stalking Horse Bidder and Borrowers, with no material conditions to close, except for an order of the Bankruptcy Court approving the sale and a financing contingency and a contingency related to the Borrowers’ collective bargaining agreements, in each case, acceptable to Agent and Lenders; (b) Borrowers shall have obtained the Bankruptcy Court’s approval of the Stalking Horse Bid and the bidding procedures set forth in the Approved Sale Motion no later than 25 days after the Petition Date, and such Stalking Horse Bid must provide for payment in full of Borrowers’ obligations owed to Agent, Lenders, Prepetition Senior Agent and Prepetition Senior Secured Parties, including, without limitation, all Prepetition Senior Obligations and all Obligations; (c) The final auction of the assets covered by the Stalking Horse Bid shall be held no later than the Auction Deadline; (d) The contingencies to the Stalking Horse Bid set forth in Section 10.1(e) and (f) thereof shall each have been waived by the Stalking Horse 91

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Bidder or otherwise satisfied on or before the date of the final hearing on the Approved Sale Motion; and (e) The Bankruptcy Court shall grant the Approved Sale Motion no later than 75 days after the Petition Date, and the closing and funding of the sale described therein (including the receipt by Agent, Lenders, Prepetition Senior Agent, and Prepetition Senior Lenders of full payment of Borrowers’ obligations owed to Postpetition Agent, Postpetition Lenders, Prepetition Senior Agent and Prepetition Senior Secured Parties, including, without limitation, all Prepetition Senior Obligations and all Obligations) must occur no later than 85 days after the Petition Date. (ii) Borrowers shall (a) promptly, and in any event no later than five Business Days after receipt or delivery thereof, as applicable, deliver to Agent copies of any and all initial indications of interest from prospective buyers, management presentations to prospective buyers, and bids from prospective buyers, and (b) promptly, and in any event no later than five Business Days after obtaining knowledge thereof, provide Agent with notice of the withdrawal of any bid from a prospective buyer and any other event that could reasonably be expected to have a materially adverse effect on any potential Sale Transaction or the timing thereof. (iii) Borrowers (a) shall cause the Advisor to be retained at all times until a Sale Transaction has occurred, (b) shall not reduce the scope of the Advisors’ primary duties without the prior written consent of Agent, (c) acknowledge and agree that Agent shall have access to the Advisor and (d) shall provide Agent with copies of materials related to any Sale Transaction that is provided to any Borrower’s Board of Directors. (iv) Nothing contained in this Section 10.1.16 shall constitute Agent’s or Lenders’ consent to the sale, transfer, or other disposition of any of the Collateral or any of the Borrowers’ other assets. 10.1.17. Chapter 11 Pleadings. Promptly (and in any event within two Business Days) after filing thereof, Borrowers will deliver, or cause to be delivered, to Agent copies of any pleadings, motions, applications, financial information and other papers and documents filed by any Borrower in any Chapter 11 Case, which papers and documents would not otherwise be served on Agent and Agent’s counsel pursuant to the Bankruptcy Court’s appropriate procedures. 10.1.18. Committee Reports. Promptly (and in any event within two Business Days) after sending thereof, Borrowers will deliver, or cause to be delivered, to Agent copies of all written reports given by any Borrower to any Committee. 10.2. Negative Covenants. For so long as there are any Revolver Commitments outstanding and thereafter until Full Payment of the Obligations, each Borrower covenants that it shall not and shall not permit any Subsidiary to: 92

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Fundamental Changes.

(i) Merge, reorganize, consolidate or amalgamate with any Person, or liquidate, wind up its affairs or dissolve itself, in each case whether in a single transaction or in a series of related transactions, except mergers or consolidations of any Borrower with another Borrower; (ii) change an Borrowerâ&#x20AC;&#x2122;s name or conduct business under any new fictitious name or change a Borrowerâ&#x20AC;&#x2122;s FEIN, organization identification number or state of organization unless (i) Borrower Agent has given Agent at least 30 days prior written notice of such change, (ii) Agent has confirmed that its Lien continues to constitute a first priority Lien in the Collateral after giving effect to such change and (iii) Borrowers execute and deliver to Agent any documents or agreements requested by Agent to give effect in the Loan Documents to such change and to ensure the first priority Lien of Agent in the Collateral. 10.2.2. Loans. Make any loans or other advances of money to any Person other than (i) to an officer or employee of a Borrower or a Subsidiary for salary, travel advances, advances against commissions and other similar advances in the Ordinary Course of Business, and (ii) to the extent permitted under Section 10.2.13. 10.2.3. Funded Debt, except:

Permitted Debt. Create, incur, assume, guarantee or suffer to exist any (i)

the Obligations;

(ii)

[reserved];

(iii) Debt for Money Borrowed by such Borrower (other than the Obligations, and Subordinated Debt permitted herein), but only to the extent that such Debt is outstanding on the date of this Agreement and listed on Schedule 10.2.3, and is not to be satisfied on or about the Closing Date from the proceeds of the Loans; (iv)

Permitted Contingent Obligations;

(v)

unsecured Debt pursuant to non-speculative Hedging Agreements;

(vi)

[reserved];

(vii)

[reserved];

(viii) unsecured intercompany Debt that is (i) Debt owing from a Borrower to another Borrower, (ii) [reserved], (iii) Debt owing by a non-Borrower to a Borrower in an aggregate principal amount not to exceed $2,000,000 at any one time outstanding, (iv) Debt owing by a Borrower to a non-Borrower, provided that any such 93

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Debt is Subordinated Debt, and (v) Debt owing by a non-Borrower to any other nonBorrower; (ix) unsecured Debt consisting of the financing of insurance premiums in the Ordinary Course of Business; (x) unsecured Debt relating to surety and appeal bonds incurred in the Ordinary Course of Business in an amount not to exceed $2,000,000; (xi)

[reserved];

(xii) unsecured Debt that is not included in any of the preceding paragraphs of this Section 10.2.3, is not secured by a Lien and does not exceed at any time, in the aggregate, the sum of $2,500,000 as to all Borrowers and all of their Subsidiaries; (xiii) Refinancing Debt so long as each of the Refinancing Conditions is met with respect thereto; (xiv)

Debt pursuant to the Prepetition Senior Loan Documents;

(xv) Debt pursuant to the Prepetition Junior Loan Documents, but only to the extent subject to the Prepetition Intercreditor Agreement; and (xvi)

Permitted Junior DIP Debt.

None of the provisions of this Section 10.2.3 that authorize any Borrower to incur any Debt shall be deemed to override, modify or waive any of the provisions of Section 10.3 or 10.4, which shall constitute independent and separate covenants and obligations of each Borrower. 10.2.4. Affiliate Transactions. Enter into, or be a party to any transaction with any Affiliate, except: (i) the transactions contemplated by the Loan Documents; (ii) payment of reasonable compensation to officers and employees for services actually rendered to Borrowers or their respective Subsidiaries; (iii) payment of customary directors’ fees and indemnities; (iv) transactions with Affiliates that were consummated prior to the date hereof and identified on Schedule 10.2.4; (v) accounts payable to Affiliates of Borrowers in the Ordinary Course of Business; and (vi) transactions with Affiliates upon fair and reasonable terms that are no less favorable to such Borrower or such Subsidiary than such Borrower or such Subsidiary would obtain in a comparable arm’s length transaction with a Person not an Affiliate or stockholder of such Borrower or such Subsidiary to the extent required to be so reflected in accordance with GAAP, or reflected in the Consolidated income statements of Borrowers and their Subsidiaries; (vii) Distributions to the extent permitted by Section 10.2.7, and (viii) management fees, licensing fees and similar fees payable by a Subsidiary of a Borrower to such Borrower. 10.2.5. Limitation on Liens. Create or suffer to exist any Lien upon any of its Property, income or profits, whether now owned or hereafter acquired, except the following (collectively, “Permitted Liens”): 94

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Liens at any time granted in favor of Agent;

(ii) Liens for Taxes (excluding any Lien imposed pursuant to any of the provisions of ERISA) not yet due or being Properly Contested; (iii) statutory Liens (excluding any Lien for Taxes, including any Lien imposed pursuant to any of the provisions of ERISA) arising in the Ordinary Course of Business of a Borrower or a Subsidiary, but only if and for so long as (x) payment in respect of any such Lien is not at the time required or the Debt secured by any such Liens is being Properly Contested and (y) such Liens do not materially detract from the value of the Property of such Borrower or such Subsidiary and do not materially impair the use thereof in the operation of such Borrower’s or such Subsidiary’s business; (iv)

[reserved];

(v)

[reserved];

(vi)

[reserved];

(vii) Liens securing Debt of a Subsidiary of a Borrower to such Borrower or Debt of a Borrower to another Borrower; (viii) Liens arising by virtue of the rendition, entry or issuance against such Borrower or any of its Subsidiaries, or any Property of such Borrower or any of its Subsidiaries, of any judgment, writ, order, or decree for so long as each such Lien (a) is in existence for less than 20 consecutive days after it first arises or is being Properly Contested and (b) is at all times junior in priority to any Liens in favor of Agent; (ix) Liens incurred or deposits made in the Ordinary Course of Business to secure the performance of tenders, bids, leases, contracts (other than for the repayment of Money Borrowed), statutory obligations and other similar obligations (including pledges and deposits made in the Ordinary Course of Business in compliance with the Federal Employers Liability Act or any other workers’ compensation, unemployment insurance and other social security laws or regulations) or arising as a result of progress payments under government contracts, provided that, to the extent any such Liens attach to any of the Collateral, such Liens are at all times subordinate and junior to the Liens upon the Collateral in favor of Agent; (x) zoning restrictions, building codes or land use laws, leases, easements, rights-of-way, restrictions, covenants or other agreements of record and other similar charges or encumbrances on real Property of such Borrower or any of its Subsidiaries that do not interfere with the ordinary conduct of the business of such Borrower or such Subsidiary; (xi) normal and customary rights of setoff upon deposits of cash in favor of banks and other depository institutions and Liens of a collecting bank arising under the UCC on checks and other items of payment in the course of collection; 95

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[reserved];

(xiii) such other Liens as appear on Schedule 10.2.5, to the extent provided therein; (xiv) Liens disclosed by the title insurance policies previously delivered pursuant to Prepetition Senior Loan Agreement and any replacement, extension or renewal of any such Lien; provided, that, such replacement, extension or renewal Lien shall not cover any Property other than the Property that was subject to such Lien prior to such replacement, extension or renewal; and provided, further, that the Debt and other obligations secured by such replacement, extension or renewal Lien are permitted by this Agreement; (xv) Liens on Equipment arising from precautionary UCC financing statements regarding operating leases of Equipment; (xvi) any rights of lessors of any real or personal Property arising from the granting of a leasehold interest to a Borrower in such Property but excluding any contractual security interest or Lien of such lessor in any Property of any Borrower which shall not constitute a Permitted Lien under this Section 10.2.5; (xvii) contractual rights of setoff of depository banks in the Ordinary Course of Business but only so long as such depository bank has executed a Deposit Account Control Agreement in favor of Agent in form and substance satisfactory to Agent in all respects to the extent required by this Agreement; (xviii) [reserved]; (xix) Liens in cash collateral pledged to secure obligations under hedging arrangements in the Ordinary Course of Business with a Person other than a Lender or an Affiliate of such Lender; (xx) Liens granted pursuant to that certain Personal Property Lease Agreement, dated as of December 31, 2012, between IDB and Services NY (the “PILOT Lease”) solely on personal property of Services NY located at the subject property of such PILOT Lease so long as such Liens are subordinated to Agent’s Liens on such property on terms and conditions reasonably acceptable to Agent; (xxi) such other Liens as Agent and the Required Lenders in their sole discretion may hereafter approve in writing; (xxii) Liens granted pursuant to the DIP Order; (xxiii) Liens granted to pursuant to the Prepetition Senior Loan Documents;

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(xxiv) Liens granted pursuant to the Prepetition Junior Loan Documents, but only to the extent subject to the Prepetition Intercreditor Agreement; (xxv) Prior Liens (as defined in the DIP Order); and (xxvi) Permitted Junior DIP Liens. The foregoing negative pledge shall not apply to any Margin Stock to the extent that the application of such negative pledge to such Margin Stock would require filings or other actions by any Lender under Regulation U or other regulations of the Board of Governors, or otherwise result in a violation of any such regulations. 10.2.6. Restrictions on Payment of Certain Debt. Make any payments with respect to any Subordinated Debt other than to the extent permitted by the DIP Order. 10.2.7.

Distributions. Declare or make any Distributions except for Upstream

Payments. 10.2.8. Upstream Payments. Create or suffer to exist any encumbrance or restriction on the ability of a Subsidiary to make any Upstream Payment, except for encumbrances or restrictions (i) pursuant to the Loan Documents, Prepetition Senior Loan Documents, or Prepetition Junior Loan Documents, (ii) existing under Applicable Law, (iii) customary provisions restricting subletting or assignment of any lease governing any leasehold interest of Borrowers or any of their Subsidiaries, (iv) customary provisions restricting assignment of any licensing agreement (in which Borrowers or any of their Subsidiaries is the licensee) or other contract entered into by the Borrowers or any of their Subsidiaries in the Ordinary Course of Business, (v) restrictions on the transfer of any asset pending the close of the sale of such asset, and (vi) restrictions on the transfer of any asset subject to a Lien permitted by Section 10.2.5. 10.2.9. Restrictions on Payment of Certain Debt. Make any payments with respect to any Prepetition Junior Obligations except to the extent permitted under the DIP Financing Order and the Prepetition Intercreditor Agreement. 10.2.10. Reserved. 10.2.11. Disposition of Assets. Permitted Asset Disposition.

Make any Asset Disposition other than a

10.2.12. Subsidiaries. Form or acquire any Subsidiary after the Closing Date. 10.2.13. Restricted Investments. Make or have any Restricted Investment. 10.2.14. Accounting Changes. Without the consent of Agent (such consent not to be unreasonably withheld or delayed) establish a fiscal year different from the Fiscal Year.

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10.2.15. Organic Documents. Amend, modify or otherwise change any of the terms or provisions in any of its Organic Documents as in effect on the date hereof, except for changes that do not affect in any way (i) such Borrower’s or any of its Subsidiaries’ right and authority to enter into and perform the Loan Documents to which it is a party, (ii) the perfection of Agent’s Liens or Prepetition Senior Agent’s Liens in any of the Collateral, or (iii) the authority or obligation of such Borrower to perform and pay the Obligations or Prepetition Senior Obligations. 10.2.16. Hedging Agreements. Enter into any Hedging Agreement, other than Hedging Agreements entered into to hedge or mitigate risks to which any Borrower or any Subsidiary is exposed in the conduct of its business or the management of its liabilities and not for any speculative purpose. 10.2.17. Anti-Terrorism Laws. Conduct any business or engage in any transaction or dealing with any Blocked Person, including the making or receiving any contribution of funds, goods or services to or for the benefit of any Blocked Person; deal in, or otherwise engage in any transaction relating to, any property or interests in property blocked pursuant to Executive Order No. 13224; or engage in on conspire to engage in any transaction that evades or avoids, or has the purpose of evading or avoiding, or attempts to violate, any of the prohibitions set forth in Executive Order No. 13224 or the USA PATRIOT Act. Borrowers shall deliver to Agent and Lenders any certification or other evidence requested from time to time by Agent or any Lender, in its sole discretion, confirming each Borrower’s compliance with this Section 10.2.17. 10.2.18. Conduct of Business. Engage in any business other than the business engaged in by it on the Closing Date and any business or activities which are substantially similar, related or incidental thereto. 10.2.19. Deposit and Securities Accounts. (i) Establish any new Deposit Account or Securities Account (other than with Wells Fargo or Regions) without Agent’s consent or (ii) allow any Deposit Account or Securities Account with a balance in excess of $250,000 either individually or in the aggregate to exist if Agent does not have a first priority Lien in such Deposit Account or Securities Account unless such Deposit Account under clause (ii) hereof is for payroll or payroll taxes. 10.2.20. [Reserved]. 10.2.21. [Reserved]. 10.2.22. [Reserved]. 10.3. Financial Covenant. For so long as there are any Revolver Commitments outstanding and thereafter until Full Payment of the Obligations, Borrowers covenant that they shall, commencing with the fourth week after the Petition Date and at all times thereafter, be in Substantial Compliance with the Approved Budget. 98

10.4.

[Reserved]

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SECTION 11. CONDITIONS PRECEDENT 11.1. Conditions Precedent to Initial Credit Extensions. Initial Lenders shall not be required to fund any requested Loan or otherwise extend credit to Borrowers, nor shall Issuing Bank be required to issue any Letter of Credit, unless each of the following conditions has been satisfied on the Closing Date: 11.1.1. Loan Documents. Each of the Loan Documents shall have been duly executed and delivered to Agent by each of the signatories thereto and accepted by Agent and Initial Lenders. 11.1.2.

[Reserved].

11.1.3. Evidence of Perfection and Priority of Liens. The DIP Order shall contain all findings of fact and conclusions of law necessary to perfect the Liens of Agent in the Collateral in form satisfactory to Agent and Initial Lenders that such Liens constitute valid and perfected Liens, and that there are no other Liens upon any Collateral except for Permitted Liens. 11.1.4. Organic Documents. Agent shall have received copies of and found acceptable the Organic Documents of each Borrower, and all amendments thereto, certified by the Secretary of State or other appropriate officials of the jurisdiction of each Borrowerâ&#x20AC;&#x2122;s and each other Borrowerâ&#x20AC;&#x2122;s states of organization. 11.1.5.

[Reserved].

11.1.6.

[Reserved.

11.1.7.

[Reserved.]

11.1.8. Borrowing Base Certificate. Agent shall have received a Borrowing Base Certificate prepared as of the Closing Date. 11.1.9.

[Reserved].

11.1.10. Payment of Fees. Borrowers shall have paid, or made provision for the payment on the Closing Date of, all fees and expenses to be paid to Agent and Lenders hereunder on or before the Closing Date and all fees and expenses to be paid to Agent on or before the Closing Date, in each case, to the extent due and invoiced. 11.1.11. LC Conditions. With respect to the issuance of any Letter of Credit on the Closing Date, each of the LC Conditions is satisfied. 11.1.12. [Reserved.] 11.1.13. [Reserved].

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11.1.14. Insurance. Borrowers shall have procured and have in effect insurance policies (property, casualty, liability and business interruption) in form and amount and covering such matters as are customary for companies in the business of Borrowers and issued by such insurance companies as are reasonably acceptable to Agent, with Agent shown as lenderâ&#x20AC;&#x2122;s loss payee and mortgage on all property and casualty and business interruption insurance policies and additional insured on all liability insurance policies. 11.1.15. [Reserved]. 11.1.16. [Reserved]. 11.1.17. [Reserved]. 11.1.18. [Reserved]. 11.1.19. [Reserved]. 11.1.20. Representations. All representations and warranties made by any Borrower shall be true and correct on the Closing Date. 11.1.21. Interim Order. The Interim Order shall have been entered by the Bankruptcy Court, and such order shall be in full force and effect and shall not have been reversed, modified, amended, subject to a pending appeal, stayed or vacated (other than by the Final Order) absent the prior written consent of the Agent and Lenders. 11.2. Conditions Precedent to All Credit Extensions. Lenders shall not be required to fund any Loans or otherwise extend any credit to or for the benefit of Borrowers, nor shall Issuing Bank be required to issue any Letter of Credit, unless and until each of the following conditions has been and continues to be satisfied: 11.2.1. No Defaults. No Default or Event of Default exists at the time, or would result from the funding, of any Loan or other extension of credit. 11.2.2. No Litigation. After the Closing Date, no action, proceeding, investigation, regulation or legislation shall have been instituted, threatened or proposed before any court, governmental agency or legislative body to enjoin, restrain or prohibit, or to obtain damages in respect of, this Agreement or any of the other Loan Documents. 11.2.3. No Material Adverse Effect. No event shall have occurred and no condition shall exist which has or could be reasonably expected to have a Material Adverse Effect. 11.2.4. Borrowing Base Certificate. Agent shall have received each Borrowing Base Certificate then required by the terms of this Agreement. 11.2.5. LC Conditions. With respect to the issuance of any Letter of Credit after the Closing Date, each of the LC Conditions is satisfied. 100

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11.2.6. Compliance with Approved Budget. Borrowers shall be in Substantial Compliance with the Approved Budget immediately before and immediately after (on a pro forma basis) giving effect to any request for a Revolver Loan or issuance of any Letter of Credit. 11.2.7. DIP Order. The DIP Order shall be in full force and effect and shall not have been reversed, modified, amended, subject to a pending appeal, stayed or vacated (other than, as to the Interim Order, by the Final Order) absent the prior written consent of Agent and the Lenders. provided, that at any time, to the extent Borrowers are not in compliance with the covenant in Section 10.3, Agent and Lenders shall have no obligation to Borrowers whatsoever to honor any request for a Revolver Loan. 11.3. Inapplicability of Conditions. None of the conditions precedent set forth in Sections 11.1 or 11.2 shall be conditions to the obligation of (i) each Participating Lender to make payments to WFCF pursuant to Section 2.4.2, (ii) each Lender to deposit with Agent such Lenderâ&#x20AC;&#x2122;s Pro Rata share of a Borrowing in accordance with Section 4.1.2, (iii) each Lender to fund its Pro Rata share of a Revolver Loan to repay outstanding Swingline Loans to WFCF as provided in Section 4.1.3(ii), (iv) each Lender to pay any amount payable to Agent or any other Lender pursuant to this Agreement or (v) Agent to pay any amount payable to any Lender pursuant to this Agreement. 11.4. Limited Waiver of Conditions Precedent. If Lenders shall make any Loan or otherwise extend any credit to Borrowers under this Agreement at a time when any of the foregoing conditions precedent are not satisfied (regardless of whether the failure of satisfaction of any such conditions precedent was known or unknown to Agent or Lenders), the funding of such Loan or other extension of credit shall not operate as a waiver of the right of Agent and Lenders to insist upon the satisfaction of all conditions precedent with respect to each subsequent Borrowing requested by Borrowers or a waiver of any Default or Event of Default as a consequence of the failure of any such conditions to be satisfied, unless Agent, with the prior written consent of the Required Lenders, in writing waives the satisfaction of any condition precedent, in which event such waiver shall only be applicable for the specific instance given and only to the extent and for the period of time expressly stated in such written waiver. 11.5. Conditions Subsequent. Lenders shall not be required to fund any Loans or otherwise extend any credit to or for the benefit of Borrowers, nor shall Issuing Bank be required to issue any Letter of Credit, unless and until the Borrowers have fulfilled, on or before the date applicable thereto (or such later date as may be agreed by the Agent in its discretion), the conditions subsequent set forth on Schedule 11.5 (the failure by Borrowers to so perform or cause to be performed such conditions subsequent as and when required by the terms thereof (or such later date as may be agreed by the Agent in its discretion), shall constitute an Event of Default. Notwithstanding the foregoing, if Lenders shall make any Loan or otherwise extend any credit to Borrowers under this Agreement at a time when any of the conditions subsequent set forth on Schedule 11.5 are not satisfied, the funding of such Loan or other extension of credit shall not operate as a waiver of the right of Agent and Lenders to insist upon the satisfaction of all conditions subsequent on or before the date applicable thereto with respect to each subsequent 101

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Borrowing requested by Borrowers or a waiver of any Default or Event of Default as a consequence of the failure of any such conditions to be satisfied. SECTION 12. EVENTS OF DEFAULT; RIGHTS AND REMEDIES ON DEFAULT 12.1. Events of Default. The occurrence or existence of any one or more of the following events or conditions shall constitute an â&#x20AC;&#x153;Event of Defaultâ&#x20AC;? (each of which Events of Default shall be deemed to exist unless and until waived by Agent and Lenders in accordance with the provisions of Section 13.9): 12.1.1. Payment of Obligations. Borrowers shall fail to pay any of the Obligations consisting of principal on the Loans on the due date thereof (whether due at stated maturity, on demand, upon acceleration or otherwise) or shall fail to pay any interest and other Obligations within five days after the due date thereof (whether due at stated maturity, on demand, upon acceleration or otherwise). 12.1.2. Misrepresentations. Any representation, warranty or other written statement to Agent or any Lender by or on behalf of any Borrower, whether made in or furnished in compliance with or in reference to any of the Loan Documents (including any representation made in any Borrowing Base Certificate), proves to have been false or misleading in any material respect when made or furnished or when reaffirmed pursuant to Section 9.2. 12.1.3. Breach of Specific Covenants. Any Borrower shall fail or neglect to perform, keep or observe (i) any covenant contained in Sections 8.1.1, 8.2.4, 8.2.5, 8.2.6, 10.1.1, 10.1.5, 10.1.7, 10.1.14, 10.1.15, 10.1.16, 10.1.17, 10.1.18, 10.2 or 10.3 on the date that such Borrower is required to perform, keep or observe such covenant, (ii) any covenant contained in Sections 8.2.1, 8.3.1 or 8.5 on the date that such Borrower is required to perform, keep or observe such covenant and the breach of such covenant under this clause (ii) is not cured within 1 Business Day after such date, provided, that in no event shall such 1 Business Day grace period under this clause (ii) be available to Borrowers more than twice during the Term or (iii) any covenant contained in Section 10.1.3 on the date that such Borrower is required to perform, keep or observe such covenant and the breach of such covenant under this clause (iii) is not cured within 5 days after such date, provided, (A) such cure period shall not apply to clauses (viii), (ix), and (xi) of Section 10.1.3, and (B) that in no event shall such 5 day grace period under this clause (iii) be available to Borrowers more than twice during the Term. 12.1.4. Breach of Other Covenants. Any Borrower shall fail or neglect to perform, keep or observe any covenant contained in this Agreement (other than a covenant which is dealt with specifically elsewhere in Section 12.1) and the breach of such other covenant is not cured within 30 days after the earlier of (i) notice of such breach from Agent and (ii) the date on which any Senior Officer of any Borrower or any Subsidiary thereof either knew or should have known about such breach. 12.1.5. Default Under Security Documents/Other Agreements. Any event of default (as defined therein) shall occur under any of the Other Agreements or Security Documents. 102

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12.1.6. Other Defaults. There shall occur any event of default on the part of any Borrower or any Subsidiary under any agreement, document or instrument to which such Borrower or such Subsidiary is a party or by which such Borrower or such Subsidiary or any of their respective Properties is bound, creating or relating to any Debt for Money Borrowed (other than the Obligations) in excess of $2,000,000, in each case incurred on or after the Petition Date, if the payment or maturity of such Debt may be accelerated in consequence of such event of default or demand for payment of such Debt may be made. 12.1.7.

[Reserved.]

12.1.8. Business Disruption. There shall occur a cessation of a substantial part of the business of Borrowers taken as whole (other than in connection with a consolidation or merger of a Borrower with another Borrower to the extent permitted by Section 10.2.1 hereof ). 12.1.9. ERISA. A Reportable Event (other than as a result of the filing of the Chapter 11 Cases) shall occur which Agent, in its reasonable discretion, shall determine constitutes grounds for the termination by the Pension Benefit Guaranty Corporation of any Plan (other than a Multiemployer Plan) or for the appointment by the appropriate United States district court of a trustee for any Plan (other than a Multiemployer Plan), or if any Plan (other than a Multiemployer Plan) shall be terminated or any such trustee shall be requested or appointed, or if any Borrower, any Subsidiary or any Borrower is in “default” (as defined in Section 4219(c)(5) of ERISA) with respect to payments to a Multiemployer Plan resulting from such Borrower’s, such Subsidiary’s or such Borrower’s complete or partial withdrawal from such Multiemployer Plan. 12.1.10. Challenge to Loan Documents. Any Borrower or any of its Affiliates shall challenge or contest (or support the challenge or contest of others) in any action, suit or proceeding the validity or enforceability of any of the Loan Documents, the legality or enforceability of any of the Obligations or the perfection or priority of any Lien granted to Agent, or any of the Loan Documents ceases to be in full force or effect for any reason other than a full or partial waiver or release by Agent and Lenders in accordance with the terms thereof. 12.1.11. Judgment. One or more judgments or orders for the payment of money in an amount that are unsatisfied that exceeds, individually or in the aggregate, $750,000 shall be entered against any Borrower and (i) enforcement proceedings shall have been commenced by an creditor upon such judgment or order, and (ii) such judgment or order, shall not be subject to the Automatic Stay. 12.1.12. [Reserved]. 12.1.13. Criminal Forfeiture. Any Borrower (or any of its Senior Officers) is criminally convicted for (i) a felony committed in the conducted of the business of such Borrower or (ii) any state or federal law (including the Controlled Substances Act, the Money Laundering Control Act of 1986, and the Illegal Exportation of War Materials Act) that is reasonably likely to lead to a forfeiture of any material Collateral. 103

12.1.14. Change of Control. A Change of Control shall occur.

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12.1.15. Additional Events of Default. The occurrence of any of the following in any Chapter 11 Case: (i) the bringing of a motion, taking of any action or the filing of any plan of reorganization or disclosure statement attendant thereto by any Borrower in any Chapter 11 Case: (w) to obtain additional financing under Section 364(c) or (d) of the Bankruptcy Code not otherwise permitted pursuant to this Agreement; (x) to grant any Lien other than Permitted Encumbrances upon or affecting any Collateral; (y) except as provided in the DIP Order, to use cash collateral of Agent under Section 363(c) of the Bankruptcy Code without the prior written consent of the Agent and the Lenders; or (z) any other action or actions adverse to either (i) the Agent and the Lenders or their rights and remedies hereunder or their interest in the Collateral or (ii) the Prepetition Senior Agent and the Prepetition Senior Secured Parties or their rights and remedies under the Prepetition Senior Loan Documents or their interest in their respective collateral; (ii) the filing of any plan of reorganization or disclosure statement attendant thereto, or any direct or indirect amendment to such plan or disclosure statement, by a Borrower, or the entry of an order in any of the Chapter 11 Cases confirming such plan or approving such disclosure statement, (i) to which the Agent, Lenders, the Prepetition Senior Agent, and Prepetition Senior Lenders do not consent in writing or otherwise agree to the treatment of their respective claims or (ii) that fails to provide for the payment in full in cash of all Obligations and Prepetition Senior Obligations (and the termination of all related lending commitments) on the effective date of such plan; (iii) the entry of an order in any of the Chapter 11 Cases confirming a plan or plans of reorganization that does not contain a provision for termination of the Commitments and repayment in full in cash of all of the Obligations under this Agreement and all of the Prepetition Senior Obligations on or before the effective date of such plan or plans; (iv) the entry of an order amending, supplementing, staying, vacating or otherwise modifying the Loan Documents or the DIP Order without the written consent of the Agent (or any Borrower applies for, consents to, or acquiesces in, any such relief) and the Lenders or the filing by the Borrowers of a motion for reconsideration with respect to the DIP Order; (v) the Final Order is not entered by the earlier to occur of (x) immediately following the expiration of the Interim Order and (y) the date that is thirty (30) days after the entry of the Interim Order; (vi) the payment of, or application for authority to pay, any Prepetition claim without the Agent's and Lendersâ&#x20AC;&#x2122; prior written consent unless otherwise expressly permitted under this Agreement or the DIP Order or the Approved Budget;

104

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(vii) the Bankruptcy Court or any other court of competent jurisdiction enters an order or judgment allowing, imposing, surcharging or assessing any claim, cost or expense against the Agent, any Lender, the Prepetition Senior Agent, or any of the Prepetition Senior Secured Parties or against any of their respective collateral (or any Borrower applies for, consents to, or acquiesces in, any such relief), whether pursuant to section 506(c) of the Bankruptcy Code or otherwise; (viii) the appointment of an interim or permanent trustee in any Chapter 11 Case or the appointment of a receiver or an examiner in any Chapter 11 Case with expanded powers to operate or manage the financial affairs, the business, or reorganization of any Borrower (or in each case any Borrower applies for, consents to, or acquiesces in, any such relief); (ix) the sale, without the Agent's, Lenders’, Prepetition Senior Agent's, and Prepetition Senior Lenders’ consent, of all or substantially all of any Borrower’s assets either through a sale under Section 363 of the Bankruptcy Code, whether through one transaction or a series of transactions, through a confirmed plan of reorganization in the Chapter 11 Cases, or otherwise that does not provide for payment in full in cash of the Obligations and the Prepetition Senior Obligations and termination of related lending commitments; (x) the dismissal of any Chapter 11 Case, or the conversion of any Chapter 11 Case from one under Chapter 11 to one under Chapter 7 of the Bankruptcy Code (or in each case, any Borrower applies for, consents to, or acquiesces in, any such relief); (xi) the entry of an order by the Bankruptcy Court granting relief from or modifying the Automatic Stay (x) to allow any creditor to execute upon or enforce a Lien on any Collateral, or (y) with respect to any Lien of or the granting of any Lien on any Collateral to any state or local environmental or regulatory agency or authority, which in either case is with respect to any portion of the Collateral having a value, individually or in the aggregate, in excess of $250,000 or which would otherwise have a Material Adverse Effect; (xii) the commencement of a suit or action against Agent, any Lender, Prepetition Senior Agent, or any of the Prepetition Senior Secured Parties, by or on behalf of a Borrower; (xiii) the entry of any order in any suit or action against Agent, any Lender, Prepetition Senior Agent, or any of the Prepetition Senior Secured Parties, that asserts or seeks by or on behalf of a Borrower, the Environmental Protection Agency, any state environmental protection or health and safety agency, any Committee or any other party in interest in any of the Chapter 11 Cases, (x) awarding any claim, stay, injunctive relief or other damages against Agent, any Lender, Prepetition Senior Agent, or any of the Prepetition Senior Secured Parties; or (y) granting or awarding any legal or equitable remedy that would have the effect of subordinating any or all of the Obligations or Liens 105

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of Agent or any Lender under the Loan Documents or DIP Order, or Prepetition Senior Agent or any of the Prepetition Senior Secured Parties under the Prepetition Senior Loan Documents or DIP Order, to any other claim; (xiv) the entry of an order in any Chapter 11 Case avoiding or requiring repayment of any portion of the payments made on account of the Obligations owing under this Agreement or the other Loan Documents or on account of the Prepetition Senior Obligations owing under the Prepetition Senior Loan Agreement or Prepetition Senior Loan Documents (or in each case any Borrower applies for, consents to, or acquiesces in, any such relief); (xv) the breach of and/or failure of any Borrower to perform any of its obligations under the DIP Order; (xvi) the Bankruptcy Court or any other court of competent jurisdiction enters an order or judgment, or any Borrower applies for, consents to, or acquiesces in, the entry of such order or judgment, in any Chapter 11 Case modifying, limiting, subordinating or avoiding (i) the priority of any Obligations or Prepetition Senior Obligations or (ii) the perfection, priority or validity of any Lien securing such Obligations or Prepetition Senior Obligations; (xvii) the entry of an order in any of the Chapter 11 Cases granting any other super priority administrative claim or Lien (other than the Carve-Out) equal or superior to that granted to Agent, on behalf of itself and Lenders, or Prepetition Senior Agent, on behalf of itself and Prepetition Senior Secured Parties, hereunder or under the DIP Order (or in each case any Borrower applies for, consents to, or acquiesces in, any such relief); or (xviii) the termination of the Stalking Horse Bid unless the Debtors have accepted a higher or better competing bid which provides for the permanent and indefeasible payment in full of the Postpetition Obligations and Prepetition Senior Obligations, as applicable, in cash, and provides for payment of expenses for the winddown of Debtorsâ&#x20AC;&#x2122; bankruptcy estates in an amount greater than that provided for by the Stalking Horse Bid. 12.2.

Remedies.

12.2.1. Subject to the applicable DIP Orders, if any Event of Default has occurred and is continuing, Agent may (and at the written request of the Required Lenders shall), notwithstanding the provisions of Section 362 of the Bankruptcy Code, without any application, motion or notice to, hearing before, or order from, the Bankruptcy Court, suspend the Revolver Commitments with respect to additional Revolver Loans and/or the issuance of additional Letters of Credit, whereupon any additional Revolver Loans and additional Letters of Credit shall be made or incurred in Agentâ&#x20AC;&#x2122;s sole discretion (or in the sole discretion of the Required Lenders, if such suspension occurred at their direction) so long as such Default or Event of Default is continuing. Subject to the applicable DIP Orders, if any Default or Event of Default has 106

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occurred and is continuing, Agent may (and at the written request of Required Lenders shall), notwithstanding the provisions of Section 362 of the Bankruptcy Code, without any application, motion or notice to, hearing before, or order from, the Bankruptcy Court, except as otherwise expressly provided herein, increase the rate of interest applicable to the Revolver Loans and the Letter of Credit fees to the Default Rate. 12.2.2. Subject to the terms of the DIP Order, including any notice periods set forth therein, and without limiting the Borrowers’ rights thereunder, if any Event of Default has occurred and is continuing, Agent may (and at the written request of the Required Lenders shall), notwithstanding the provisions of Section 362 of the Bankruptcy Code, without any application, motion or notice to, hearing before, or order from, the Bankruptcy Court: (i) terminate the Revolver Commitments with respect to further Revolver Loans or the issuance of further Letters of Credit; (ii) reduce the Revolver Commitment from time to time, (iii) declare all or any portion of the Obligations, including all or any portion of any Loan to be forthwith due and payable, and require that the LC Obligations be Cash Collateralized, all without presentment, demand, protest or further notice of any kind, all of which are expressly waived by Borrowers, (iv) direct any or all of the Borrowers to sell or otherwise dispose of any or all of the Collateral on terms and conditions acceptable to the Agent and Lenders pursuant to Sections 363, 365 and other applicable provisions of the Bankruptcy Code (and, without limiting the foregoing, direct any Borrower to assume and assign any lease or executory contract included in the Collateral to Agent’s designees in accordance with and subject to Section 365 of the Bankruptcy Code), (v) enter onto the premises of any Borrower in connection with an orderly liquidation of the Collateral, or (vi) exercise any rights and remedies provided to Prepetition Senior Agent under the Prepetition Senior Loan Documents or at law or equity, including all remedies provided under the UCC. Pursuant to the terms of the DIP Order, and subject to any notice periods set forth therein, the Automatic Stay shall be modified and vacated to permit Agent and Lenders to exercise their remedies under this Agreement and the Loan Documents, without further notice, application or motion to, hearing before, or order from, the Bankruptcy Court, provided, however, notwithstanding anything to the contrary contained herein, the Agent shall be permitted to exercise any remedy in the nature of a liquidation of, or foreclosure on, any interest of any Borrower in the Collateral only upon (x) the prior written notice required under the DIP Order to such Borrower and counsel approved by the Bankruptcy Court for any Committee and hearing by the Bankruptcy Court, and (y) the Bankruptcy Court’s approval of such liquidation of, or foreclosure on, any interest of any Borrower in the Collateral, in each case, to the extent and as set forth in the DIP Order. Upon the occurrence of an Event of Default and the exercise by Agent or Lenders of their rights and remedies under this Agreement, the other Loan Documents, and the DIP Order, Borrowers shall use commercially reasonable efforts to assist Agent and Lenders in effecting a sale or other disposition of the Collateral upon such terms as are reasonably acceptable to the Agent and Required Lenders. 12.3. Other Remedies. Subject to the terms of the DIP Order, including, without limitation, any required notices to the Borrowers upon and after the occurrence of an Event of Default and for so long as such Event of Default shall exist, Agent may in its discretion (and, upon receipt of written direction of the Required Lenders, shall) exercise from time to time the following rights and remedies: 107

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12.3.1. All of the rights and remedies of a secured party under the UCC or under other Applicable Law, and all other legal and equitable rights to which Agent may be entitled under any of the Loan Documents, all of which rights and remedies shall be cumulative and shall be in addition to any other rights or remedies contained in this Agreement or any of the other Loan Documents, and none of which shall be exclusive. 12.3.2. The right to collect all amounts at any time payable to a Borrower from any Account Debtor or other Person at any time indebted to such Borrower. 12.3.3. The right to take immediate possession of any of the Collateral, and to (i) require Borrowers to assemble the Collateral, at Borrowers’ expense, and make it available to Agent at a place designated by Agent which is reasonably convenient to both parties, and (ii) enter any premises where any of the Collateral shall be located and to keep and store the Collateral on said premises until sold (and if said premises be owned or leased by a Borrower, then such Borrower agrees not to charge Agent for storage of any Collateral thereon). 12.3.4. The right to sell or otherwise dispose of all or any Collateral in its then condition, or after any further manufacturing or processing thereof, at public or private sale or sales, with such notice as may be required by Applicable Law, in lots or in bulk, for cash or on credit, all as Agent, in its sole discretion, may deem advisable. Each Borrower agrees that any requirement of notice to any Borrower of any proposed public or private sale or other disposition of Collateral by Agent shall be deemed reasonable notice thereof if given at least 10 days prior thereto, and such sale may be at such locations as Agent may designate in said notice. Agent shall have the right to conduct such sales on any Borrower’s premises, without charge therefor, and such sales may be adjourned from time to time in accordance with Applicable Law. Agent shall have the right to sell, lease or otherwise dispose of the Collateral, or any part thereof, for cash, credit or any combination thereof, and Agent may purchase all or any part of the Collateral at public or, if permitted by law, private sale and, in lieu of actual payment of such purchase price, may set off the amount of such price against the Obligations. The proceeds realized from the sale or other disposition of any Collateral may be applied, after allowing 2 Business Days for collection, first to any Extraordinary Expenses incurred by Agent and then to the remainder of the Obligations as specified in Section 5.6.1. 12.3.5. The right to obtain the appointment of a receiver, without notice of any kind whatsoever, to take possession of the Collateral and to exercise such rights and powers as the court appointing such receiver shall confer upon such receiver. 12.3.6. The right to exercise all of Agent’s remedies under any Mortgages with respect to any Real Estate. 12.3.7. The right to require Borrowers to Cash Collateralize outstanding Letters of Credit, and, if Borrowers fail promptly to make such deposit, Lenders may (and shall upon the direction of the Required Lenders) advance such amount as a Revolver Loan (whether or not an Out-of-Formula Condition exists or is created thereby or the Revolver Commitments have been terminated). Any such deposit or advance shall be held by Agent in the Cash Collateral Account to fund future payments with respect to outstanding Letters of Credit. At such time as all Letters 108

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of Credit have been drawn upon or expired, any amounts remaining in the Cash Collateral Account shall be applied against any outstanding Obligations, or, after Full Payment of all Obligations, returned to Borrowers. 12.3.8. Agent is hereby granted an irrevocable, non-exclusive license or other right to use, license or sub-license any or all Intellectual Property owned or leased by each Borrower and all of each Borrowerâ&#x20AC;&#x2122;s computer hardware and software trade secrets, brochures, customer lists, promotional and advertising materials, labels, and packaging materials, and any Property of a similar nature, in advertising for sale, marketing, selling and collecting and in completing the manufacturing of any Collateral. 12.4. Setoff. In addition to any Liens granted under any of the Loan Documents and any rights now or hereafter available under Applicable Law, Agent and each Lender (and each of their respective Affiliates) is hereby authorized by Borrowers at any time that an Event of Default exists, without notice to Borrowers or 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 (including Debt evidenced by certificates of deposit whether matured or unmatured (but not including trust accounts)) and any other Debt at any time held or owing by such Lender or any of their Affiliates to or for the credit or the account of any Borrower against and on account of the Obligations of Borrowers arising under the Loan Documents to Agent, such Lender or any of their Affiliates, including all Loans and LC Obligations and all claims of any nature or description arising out of or in connection with this Agreement, irrespective of whether or not (i) Agent or such Lender shall have made any demand hereunder, (ii) Agent, at the request or with the consent of the Required Lenders, shall have declared the principal of and interest on the Loans and other amounts due hereunder to be due and payable as permitted by this Agreement and even though such Obligations may be contingent or unmatured or (iii) the Collateral for the Obligations is adequate. Notwithstanding the foregoing, each of Agent and Lenders agree with each other that it shall not, without the express consent of the Required Lenders, and that it shall (to the extent that it is lawfully entitled to do so) upon the request of the Required Lenders, exercise its setoff rights hereunder against any accounts of any Borrower now or hereafter maintained with Agent, such Lender or any Affiliate of any of them, but no Borrower shall have any claim or cause of action against Agent or any Lender for any setoff made without the consent of the Required Lenders and the validity of any such setoff shall not be impaired by the absence of such consent. If any party (or its Affiliate) exercises the right of setoff provided for hereunder, such party shall be obligated to share any such setoff in the manner and to the extent required by Section 13.5. 12.5.

Remedies Cumulative; No Waiver.

12.5.1. All covenants, conditions, provisions, warranties, guaranties, indemnities, and other undertakings of Borrowers contained in this Agreement, the other Loan Documents, or any other agreement between Agent or any Lender and any Borrower, heretofore, concurrently, or hereafter entered into, shall be deemed cumulative to and not in derogation or substitution of any of the terms, covenants, conditions, or agreements of Borrowers herein contained. The rights and remedies of Agent and Lenders under this Agreement and the other 109

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Loan Documents shall be cumulative and not exclusive of any rights or remedies that Agent or any Lender would otherwise have. 12.5.2. The failure or delay of Agent or any Lender to require strict performance by Borrowers of any provision of any of the Loan Documents or to exercise or enforce any rights, Liens, powers or remedies under any of the Loan Documents or with respect to any Collateral shall not operate as a waiver of such performance, Liens, rights, powers and remedies, but all such requirements, Liens, rights, powers, and remedies shall continue in full force and effect until all Loans and all other Obligations owing or to become owing from Borrowers to Agent and Lenders shall have been fully satisfied. None of the undertakings, agreements, warranties, covenants and representations of Borrowers contained in this Agreement or any of the other Loan Documents and no Event of Default by any Borrower under this Agreement or any other Loan Documents shall be deemed to have been suspended or waived by Agent or any Lender, unless such suspension or waiver is by an instrument in writing specifying such suspension or waiver and is signed by a duly authorized representative of Agent or such Lender and directed to Borrowers. 12.5.3. If Agent or any Lender shall accept performance by a Borrower, in whole or in part, of any obligation that such Borrower is required by any of the Loan Documents to perform only when a Default or Event of Default exists, or if Agent or any Lender shall exercise any right or remedy under any of the Loan Documents that may not be exercised other than when a Default or Event of Default exists, Agent’s or Lender’s acceptance of such performance by a Borrower or Agent’s or Lender’s exercise of any such right or remedy shall not operate to waive any such Event of Default or to preclude the exercise by Agent or any Lender of any other right or remedy, unless otherwise expressly agreed in writing by Agent or such Lender, as the case may be. SECTION 13. AGENT 13.1.

Appointment, Authority and Duties of Agent.

13.1.1. Each Lender hereby irrevocably appoints and designates WFCF as Agent to act as herein specified. Agent may, and each Lender by its becoming a party to this Agreement shall be deemed irrevocably to have authorized Agent to, enter into all Loan Documents to which Agent is or is intended to be a party and all amendments hereto and all Security Documents at any time executed by any Borrower, for its benefit and the Pro Rata benefit of Lenders and, except as otherwise provided in this Section 13, to exercise such rights and powers under this Agreement and the other Loan Documents as are specifically delegated to Agent by the terms hereof and thereof, together with such other rights and powers as are reasonably incidental thereto. Each Lender agrees that any action taken by Agent or the Required Lenders in accordance with the provisions of this Agreement or the other Loan Documents, and the exercise by Agent or the Required Lenders of any of the powers set forth herein or therein, together with such other powers as are reasonably incidental thereto, shall be authorized and binding upon all Lenders. Without limiting the generality of the foregoing, Agent shall have the sole and exclusive right and authority to (a) act as the disbursing and collecting agent for Lenders with respect to all payments and collections arising in connection with this 110

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Agreement and the other Loan Documents; (b) execute and deliver as Agent each Loan Document (including each Lien Waiver) and accept delivery of each such agreement by any Borrower or any other Person; (c) act as collateral agent for Secured Parties for purposes of the perfection of all security interests and Liens created by this Agreement or the Security Documents and, subject to the direction of the Required Lenders, for all other purposes stated therein, provided, that, Agent hereby appoints, authorizes and directs each Lender to act as a collateral sub-agent for Agent and the other Lenders for purposes of the perfection of all security interests and Liens with respect to a Borrower’s Deposit Accounts or Securities Accounts maintained with, and all cash and Cash Equivalents held by, such Lender; (d) subject to the direction of the Required Lenders, manage, supervise or otherwise deal with the Collateral; and (e) except as may be otherwise specifically restricted by the terms of this Agreement and subject to the direction of the Required Lenders, exercise all remedies given to Agent with respect to any of the Collateral under the Loan Documents relating thereto, Applicable Law or otherwise. The duties of Agent shall be ministerial and administrative in nature, and Agent shall not have by reason of this Agreement or any other Loan Document a fiduciary relationship with any Lender (or any Lender’s participants). Unless and until its authority to do so is revoked in writing by Required Lenders, Agent alone shall be authorized to determine whether any Accounts or Inventory constitute Eligible Accounts or Eligible Inventory (basing such determination in each case upon the meanings given to such term in Section 1), or whether to impose or release any reserve, and to exercise its own Permitted Discretion in connection therewith, which determinations and judgments, if exercised in good faith, shall exonerate Agent from any liability to Lenders or any other Person for any errors in judgment. 13.1.2. Agent (which term, as used in this sentence, shall include references to Agent’s officers, directors, employees, attorneys, agents and Affiliates and to the officers, directors, employees, attorneys and agents of Agent’s Affiliates) shall not: (a) have any duties or responsibilities except those expressly set forth in this Agreement and the other Loan Documents or (b) be required to take, initiate or conduct any Enforcement Action (including any litigation, foreclosure or collection proceedings hereunder or under any of the other Loan Documents) except to the extent directed to do so by the Required Lenders during the continuance of any Event of Default. The conferral upon Agent of any right hereunder shall not imply a duty on Agent’s part to exercise any such right unless instructed to do so by the Required Lenders in accordance with this Agreement. 13.1.3. Agent may perform any of its duties by or through its agents and employees and may employ one or more Agent Professionals and shall not be responsible for the negligence or misconduct of any such Agent Professionals selected by it with reasonable care. Borrowers shall promptly (and in any event, on demand) reimburse Agent for all reasonable expenses (including all Extraordinary Expenses) incurred by Agent pursuant to any of the provisions hereof or of any of the other Loan Documents or in the execution of any of Agent’s duties hereby or thereby created or in the exercise of any right or power herein or therein imposed or conferred upon it or Lenders (excluding, however, general overhead expenses), and each Lender agrees promptly to pay to Agent, on demand, such Lender’s Pro Rata share of any such reimbursement for expenses (including Extraordinary Expenses) that is not timely made by Borrowers to Agent. 111

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13.1.4. The rights, remedies, powers and privileges conferred upon Agent hereunder and under the other Loan Documents may be exercised by Agent without the necessity of the joinder of any other parties unless otherwise required by Applicable Law. If Agent shall request instructions from the Required Lenders with respect to any act or action (including the failure to act) in connection with this Agreement or any of the other Loan Documents, Agent shall be entitled to refrain from such act or taking such action unless and until Agent shall have received instructions from the Required Lenders; and Agent shall not incur liability to any Person by reason of so refraining. Without limiting the foregoing, no Lender shall have any right of action whatsoever against Agent as a result of Agent acting or refraining from acting hereunder or under any of the Loan Documents pursuant to or in accordance with the instructions of the Required Lenders except for Agent’s own gross negligence or willful misconduct in connection with any action taken by it. Notwithstanding anything to the contrary contained in this Agreement, Agent shall not be required to take any action that is in its opinion contrary to Applicable Law or the terms of any of the Loan Documents or that would in its reasonable opinion subject it or any of its officers, employees or directors to personal liability. 13.1.5. Agent shall promptly, upon receipt thereof, forward to each Lender (i) copies of any significant written notices, reports, certificates and other information received by Agent from any Borrower (but only if and to the extent such Borrower is not required by the terms of the Loan Documents to supply such information directly to Lenders) and (ii) copies of the results of any field audits by Agent with respect to Borrowers. Agent shall have no liability to any Lender for any errors in or omissions from any field audit or other examination of Borrowers or the Collateral, unless such error or omission was the direct result of Agent’s willful misconduct. 13.1.6. In the event that Agent and Co-Collateral Agent do not agree on a course of action or determination to be made "by Agent and Co-Collateral Agent collectively," "with the consent of Agent and Co-Collateral Agent collectively" and words of similar import in the Agreement, the determination shall be made by the individual Agent or Co-Collateral Agent that is either asserting the more conservative discretion or declining to permit the requested action for which consent is being sought by the Borrowers, as applicable. 13.2.

Agreements Regarding Collateral and Examination Reports.

13.2.1. Lenders hereby irrevocably authorize Agent to release any Lien with respect to any Collateral (i) upon the termination of the Revolver Commitments and Full Payment of the Obligations, (ii) that is the subject of an Asset Disposition which Borrowers certify in writing to Agent is a Permitted Asset Disposition (and Agent may rely conclusively on any such certificate without further inquiry), or (iii) with the written consent of all Lenders. Agent shall have no obligation whatsoever to any of the Lenders to assure that any of the Collateral exists or is owned by a Borrower or is cared for, protected or insured or has been encumbered, or that Agent’s Liens have been properly, sufficiently or lawfully created, perfected, protected or enforced or are entitled to any particular priority or to exercise any duty of care with respect to any of the Collateral.

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13.2.2. Agent and Lenders each hereby appoints each other Lender as agent for the purpose of perfecting Liens (for the benefit of Secured Parties) in any Collateral that, in accordance with the UCC or any other Applicable Law, can be perfected only by possession. Should any Lender obtain possession of any such Collateral, such Lender shall notify Agent thereof, and, promptly upon Agent’s request therefor, shall deliver such Collateral to Agent or otherwise deal with such Collateral in accordance with Agent’s instructions. 13.2.3. Each Lender agrees that neither Wells Fargo nor Agent makes any representation or warranty as to the accuracy or completeness of any Report and shall not be liable for any information contained in or omitted from any such Report; agrees that the Reports are not intended to be comprehensive audits or examinations and that Wells Fargo or Agent or any other Person performing any audit or examination will inspect only specific information regarding Obligations or the Collateral and will rely significantly upon Borrowers’ books and records as well as upon representations of Borrowers’ officers and employees; agrees to keep all Reports confidential and strictly for its internal use and not to distribute the Reports (or the contents thereof) to any Person (except to its Participants, attorneys, accountants and other Persons with whom such Lender has a confidential relationship) or use any Report in any other manner; and, without limiting the generality of any other indemnification contained herein, agrees to hold Agent and any other Person preparing a Report harmless from any action that the indemnifying Lender may take or conclusion the indemnifying Lender may reach or draw from any Report in connection with any Loans or other credit accommodations that the indemnifying Lender has made or may make to Borrowers, or the indemnifying Lender’s participation in, or its purchase of, a loan or loans of any Borrower, and to pay and protect, and indemnify, defend and hold Agent and each other such Person preparing a Report harmless from and against all claims, actions, proceedings, damages, costs, expenses and other amounts (including attorneys’ fees incurred by Agent and any such other Person preparing a Report as the direct or indirect result of any third parties who might obtain all or any part of any Report through the indemnifying Lender. 13.3. Reliance By Agent. Agent shall be entitled to rely, and shall be fully protected in so relying, upon any certification, notice or other communication (including any thereof by telephone, telex, telegram, telecopier message or cable) believed by it to be genuine and correct and to have been signed, sent or made by or on behalf of the proper Person or Persons, and upon advice and statements of Agent Professionals selected by Agent. Without limiting the generality of the foregoing, Agent may rely upon any Notice of Borrowing, LC Request, Notice of Conversion/Continuance or any similar notice or request believed by Agent to be genuine. As to any matters not expressly provided for by this Agreement or any of the other Loan Documents, Agent shall in all cases be fully protected in acting or refraining from acting hereunder and thereunder in accordance with the instructions of the Required Lenders, and such instructions of the Required Lenders and any action taken or failure to act pursuant thereto shall be binding upon Lenders. 13.4. Action Upon Default. Agent shall not be deemed to have knowledge of the occurrence of a Default or an Event of Default unless it has received written notice from a Lender or any or all Borrowers specifying the occurrence and nature of such Default or Event of Default. If Agent shall receive such a notice of a Default or an Event of Default or shall 113

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otherwise acquire actual knowledge of any Default or Event of Default, Agent shall promptly notify Lenders in writing and Agent shall take such action and assert such rights under this Agreement and the other Loan Documents, or shall refrain from taking such action and asserting such rights, as the Required Lenders shall direct from time to time. If any Lender shall receive a notice of a Default or an Event of Default or shall otherwise acquire actual knowledge of any Default or Event of Default, such Lender shall promptly notify Agent and the other Lenders in writing. As provided in Section 13.3, Agent shall not be subject to any liability by reason of acting or refraining to act pursuant to any request of the Required Lenders except for its own willful misconduct or gross negligence in connection with any action taken by it. Before directing Agent to take or refrain from taking any action or asserting any rights or remedies under this Agreement and the other Loan Documents on account of any Event of Default, the Required Lenders shall consult with and seek the advice of (but without having to obtain the consent of) each other Lender, and promptly after directing Agent to take or refrain from taking any such action or asserting any such rights, the Required Lenders will so advise each other Lender of the action taken or refrained from being taken and, upon request of any Lender, will supply information concerning actions taken or not taken. In no event shall the Required Lenders, without the prior written consent of each Lender, direct Agent to accelerate and demand payment of the Loans held by one Lender without accelerating and demanding payment of all other Loans or to terminate the Revolver Commitments of one or more Lenders without terminating the Revolver Commitments of all Lenders. Each Lender agrees that, except as otherwise provided in any of the Loan Documents or with the written consent of Agent and the Required Lenders, it will not take any legal action or institute any action or proceeding against any Borrower with respect to any of the Obligations or Collateral or accelerate or otherwise enforce its portion of the Obligations. Without limiting the generality of the foregoing, none of Lenders may exercise any right that it might otherwise have under Applicable Law to credit bid at foreclosure sales, UCC sales or other similar sales or dispositions of any of the Collateral except as authorized by Agent and the Required Lenders. Notwithstanding anything to the contrary set forth in this Section 13.4 or elsewhere in this Agreement, each Lender shall be authorized to take such action to preserve or enforce its rights against any Borrower where a deadline or limitation period is otherwise applicable and would, absent the taken of specified action, bar the enforcement of Obligations held by such Lender against such Borrower, including the filing of proofs of claim in any Insolvency Proceeding. 13.5. Ratable Sharing. If any Lender shall obtain any payment or reduction (including any amounts received as adequate protection of a bank account deposit treated as cash collateral under the Bankruptcy Code) of any Obligation of Borrowers (whether voluntary, involuntary, through the exercise of any right of set-off or otherwise) in excess of its Pro Rata share of payments or reductions on account of such Obligations obtained by all of the Lenders, such Lender shall forthwith (i) notify the other Lenders and Agent of such receipt and (ii) purchase from the other Lenders such participations in the affected Obligations as shall be necessary to cause such purchasing Lender to share the excess payment or reduction, net of costs incurred in connection therewith, on a Pro Rata basis, provided, that, if all or any portion of such excess payment or reduction is thereafter recovered from such purchasing Lender or additional costs are incurred, the purchase shall be rescinded and the purchase price restored to the extent of such recovery or such additional costs, but without interest. Each Borrower agrees that any Lender so purchasing a participation from another Lender pursuant to this Section 13.5 may, to the fullest 114

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extent permitted by Applicable Law, exercise all of its rights of payment (including the right of set-off) with respect to such participation as fully as if such Lender were the direct creditor of Borrowers in the amount of such participation. 13.6.

Indemnification of Agent Indemnitees.

13.6.1. Each Lender agrees to indemnify and defend the Agent Indemnitees (to the extent not reimbursed by Borrowers, but without limiting the indemnification obligations of Borrowers under any of the Loan Documents), on a Pro Rata basis, and to hold each of the Agent Indemnitees harmless from and against, any and all Claims which may be imposed on, incurred by or asserted against any of the Agent Indemnitees in any way related to or arising out of any of the Loan Documents or referred to herein or therein or the transactions contemplated thereby (including the costs and expenses which Borrowers are obligated to pay under Section 15.2 or amounts Agent may be called upon to pay in connection with any lockbox or Dominion Account arrangement contemplated hereby or under any indemnity, guaranty or other assurance of payment or performance given by Agent pursuant to Section 3.4.2 or the enforcement of any of the terms of any Loan Documents). 13.6.2. Without limiting the generality of the foregoing provisions of this Section 13.6, if Agent should be sued by any receiver, trustee in bankruptcy, debtor-inpossession or other Person on account of any alleged preference or fraudulent transfer received or alleged to have been received from any Borrower as the result of any transaction under the Loan Documents, then in such event any monies paid by Agent in settlement or satisfaction of such suit, together with all Extraordinary Expenses incurred by Agent in the defense of same, shall be promptly reimbursed to Agent by Lenders to the extent of each Lender’s Pro Rata share. 13.6.3. Without limiting the generality of the foregoing provisions of this Section 13.6, if at any time (whether prior to or after the Commitment Termination Date) any action or proceeding shall be brought against any of the Agent Indemnitees by a Borrower or by any other Person claiming by, through or under a Borrower, to recover damages for any act taken or omitted by Agent under any of the Loan Documents or in the performance of any rights, powers or remedies of Agent against any Borrower, any Account Debtor, the Collateral or with respect to any Loans, or to obtain any other relief of any kind on account of any transaction involving any Agent Indemnitees under or in relation to any of the Loan Documents, each Lender agrees to indemnify, defend and hold the Agent Indemnitees harmless with respect thereto and to pay to the Agent Indemnitees such Lender’s Pro Rata share of such amount as any of the Agent Indemnitees shall be required to pay by reason of a judgment, decree, or other order entered in such action or proceeding or by reason of any compromise or settlement agreed to by the Agent Indemnitees, including all interest and costs assessed against any of the Agent Indemnitees in defending or compromising such action, together with attorneys’ fees and other legal expenses paid or incurred by the Agent Indemnitees in connection therewith; provided, however, that no Lender shall be liable to any Agent Indemnitee for any of the foregoing to the extent that they arise solely from the willful misconduct or gross negligence of such Agent Indemnitee. In Agent’s discretion, Agent may also reserve for or satisfy any such judgment, decree or order from proceeds of Collateral prior to any distributions therefrom to or for the account of Lenders. 115

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13.7. Limitation on Responsibilities of Agent. Agent shall in all cases be fully justified in failing or refusing to act hereunder unless it shall have received further assurances to its satisfaction from Lenders of their indemnification obligations under Section 13.6 against any and all Claims which may be incurred by Agent by reason of taking or continuing to take any such action. Agent shall not be liable to Lenders for any action taken or omitted to be taken under or in connection with this Agreement or the other Loan Documents except as a result and to the extent of losses caused by the Agentâ&#x20AC;&#x2122;s actual gross negligence or willful misconduct. Agent does not assume any responsibility for any failure or delay in performance or breach by any Borrower or any Lender of its obligations under this Agreement or any of the other Loan Documents. Agent does not make to Lenders, and no Lender makes to Agent or the other Lenders, any express or implied warranty, representation or guarantee with respect to the Obligations, the Collateral, the Loan Documents or any Borrower. Neither Agent nor any of its officers, directors, employees, attorneys or agents shall be responsible to Lenders, and no Lender nor any of its agents, attorneys or employees shall be responsible to Agent or the other Lenders, for: (i) any recitals, statements, information, representations or warranties contained in any of the Loan Documents or in any certificate or other document furnished pursuant to the terms hereof; (ii) the execution, validity, genuineness, effectiveness or enforceability of any of the Loan Documents; (iii) the genuineness, enforceability, collectibility, value, sufficiency, location or existence of any Collateral, or the validity, extent, perfection or priority of any Lien therein; (iv) the validity, enforceability or collectibility of any the Obligations; or (v) the assets, liabilities, financial condition, results of operations, business, creditworthiness or legal status of any Borrower or any Account Debtor. Neither Agent nor any of its officers, directors, employees, attorneys or agents shall have any obligation to any Lender to ascertain or inquire into the existence of any Default or Event of Default, the observance or performance by any Borrower of any of the duties or agreements of such Borrower under any of the Loan Documents or the satisfaction of any conditions precedent contained in any of the Loan Documents. Agent may consult with and employ legal counsel, accountants and other experts and shall be entitled to act upon, and shall be fully protected in any action taken in good faith reliance upon, any advice given by such experts. 13.8.

Successor Agent and Co-Agents.

13.8.1. Subject to the appointment and acceptance of a successor Agent as provided below, Agent may resign at any time by giving at least 30 days written notice thereof to each Lender and Borrowers. Upon receipt of any notice of such resignation, the Required Lenders, after prior consultation with (but without having to obtain consent of) each Lender, shall have the right to appoint a successor Agent which shall be (i) a Lender, (ii) a United States based affiliate of a Lender, or (iii) a commercial bank that is organized under the laws of the United States or of any State thereof and has a combined capital surplus of at least $200,000,000 and, provided no Default or Event of Default then exists, is reasonably acceptable to Borrowers (and for purposes hereof, any successor to WFCF shall be deemed acceptable to Borrowers). If no successor agent is appointed prior to the effective date of the resignation of Agent, then Agent may appoint, after consultation with Lenders and Borrower Agent, a successor agent from among Lenders. Upon the acceptance by a successor Agent of an appointment to serve as an Agent hereunder, such successor Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring Agent without further act, deed or 116

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conveyance, and the retiring Agent shall be discharged from its duties and obligations hereunder but shall continue to enjoy the benefits of the indemnification set forth in Sections 13.6 and 15.2. If, at the time that Agent’s resignation is effective, it is acting as the Issuing Lender or the Swingline Lender, such resignation shall also operate to effectuate its resignation as the Issuing Lender or the Swingline Lender, as applicable, and it shall automatically be relieved of any further obligation to issue Letters of Credit, to cause the Underlying Issuer to issue Letters of Credit, or to make Swingline Loans. After any retiring Agent’s resignation hereunder as Agent, the provisions of this Section 13 (including the provisions of Section 13.6) shall continue in effect for its benefit in respect of any actions taken or omitted to be taken by it while it was acting as Agent. Notwithstanding anything to the contrary contained in this Agreement, any successor by merger or acquisition of the stock or assets of WFCF shall continue to be Agent hereunder without further act on the part of the parties hereto unless such successor shall resign in accordance with the provisions hereof. 13.8.2. In case of litigation under any of the Loan Documents, or in case Agent deems that by reason of present or future laws of any jurisdiction Agent might be prohibited from exercising any of the powers, rights or remedies granted to Agent or Lenders hereunder or under any of the Loan Documents or from holding title to or a Lien upon any Collateral or from taking any other action which may be necessary hereunder or under any of the Loan Documents, Agent may appoint an additional Person as a separate collateral agent or co-collateral agent which is not so prohibited from taking any of such actions or exercising any of such powers, rights or remedies. If Agent shall appoint an additional Person as a separate collateral agent or co-collateral agent as provided above, each and every remedy, power, right, claim, demand or cause of action intended by any of the Loan Documents to be exercised by or vested in or conveyed to Agent with respect thereto shall be exercisable by and vested in such separate collateral agent or co-collateral agent, but only to the extent necessary to enable such separate collateral agent or co-collateral agent to exercise such powers, rights and remedies, and every covenant and obligation necessary to the exercise thereof by such separate collateral agent or cocollateral agent shall run to and be enforceable by either of them. 13.9.

Consents, Amendments and Waivers.

13.9.1. No amendment or modification of any provision of this Agreement or any of the other Loan Documents, nor any waiver of any Default or Event of Default, shall be effective without the prior written agreement or consent of the Required Lenders; provided, however, that (i) without the prior written consent of Agent, no amendment or waiver shall be effective with respect to any provision in any of the Loan Documents (including Section 3.4 and this Section 13) to the extent such provision relates to the rights, duties, immunities, exculpation, indemnification or discretion of Agent; (ii) without the prior written consent of Issuing Bank or Agent, no amendment or waiver with respect to any of the LC Obligations or the provisions of Sections 2.4, 4.1.3 or 11.2.5 shall be effective; (iii) without the prior written consent of each affected Lender, no amendment or waiver shall be effective that would (1) increase or otherwise modify any Revolver Commitment of such Lender (other than to reduce such Lender’s Revolver Commitment on a proportionate basis with the same Revolver Commitments of other Lenders); (2) alter (other than to increase) the rate of interest payable in respect of any Obligations owed to such Lender; (3) waive or defer collection of any principal on the Loans or waive or defer 117

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collection of any interest or fee payable to such Lender pursuant to Section 3; or (4) subordinate the payment of any Obligations owed to such Lender to the payment of any Debt (except as expressly provided in Section 5.6.1); and (iv) without the prior written consent of all Lenders (except a defaulting Lender as provided in Section 4.2 ), no amendment or waiver shall be effective that would (1) waive any Default or Event of Default if the Default or Event of Default relates to any Borrower’s failure to observe or perform any covenant that may not be amended without the unanimous written consent of Lenders (and, where so provided hereinafter, the written consent of Agent) as hereinafter set forth; (2) alter the provisions of Sections 2.1, 3.6, 3.7, 3.8, 3.10, 5.6, 5.7, 7.1 (except to add to the categories of Property of Borrowers constituting Collateral), 13.9, 15.2, 15.3, 15.4 or 15.16; (3) amend the definitions of “Borrowing Base,” “Pro Rata” or “Required Lenders” (and the other defined terms used in such definitions), or any provision of this Agreement obligating Agent to take certain actions at the direction of the Required Lenders, or any provision of any of the Loan Documents regarding the Pro Rata treatment or obligations of Lenders; (4) subordinate the priority of any Liens granted to Agent under any of the Loan Documents to consensual, non-statutory Liens granted after the Closing Date to any other Person, except as currently provided in or contemplated by the Loan Documents (including a subordination in favor of the holders of Permitted Liens that are permitted to have priority over Agent’s Liens) and except for Liens granted by a Borrower to financial institutions with respect to amounts on deposit with such financial institutions to cover returned items, processing and analysis charges and other charges in the Ordinary Course of Business that relate to deposit accounts with such financial institutions; or (5) release any Borrower that is Solvent from liability for any of the Obligations. 13.9.2. No Borrower will, directly or indirectly, pay or cause to be paid any remuneration or other thing of value, whether by way of supplemental or additional interest, fee or otherwise, to any Lender (in its capacity as a Lender hereunder) as consideration for or as an inducement to the consent to or agreement by such Lender with any waiver or amendment of any of the terms and provisions of this Agreement or any of the other Loan Documents to the extent that the agreement of all Lenders to any such waiver or amendment is required, unless such remuneration or thing of value is concurrently paid, on the same terms, on a Pro Rata or other mutually agreed upon basis to all Lenders; provided, however, that Borrowers may contract to pay a fee only to those Lenders who actually vote in writing to approve any waiver or amendment of the terms and provisions of this Agreement or any of the other Loan Documents to the extent that such waiver or amendment may be implemented by vote of the Required Lenders and such waiver or amendment is in fact approved. 13.9.3. Any request, authority or consent of any Person who, at the time of making such request or giving such an authority or consent, is a Lender, shall be conclusive and binding upon any Transferee of such Lender. 13.9.4. Unless otherwise directed in writing by the Required Lenders, Agent may require Lenders to honor requests by Borrowers for Out-of-Formula Loans (in which event, and notwithstanding anything to the contrary set forth in Section 2.2.1 or elsewhere in this Agreement, Lenders shall continue to make Revolver Loans up to their Pro Rata share of the Revolver Commitments) and to forbear from requiring Borrowers to cure an Out-of-Formula Condition, regardless of whether an Event of Default exists, if and for so long as (i) such Out-of118

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Formula Condition does not continue for a period of more than 15 consecutive days, following which no Out-of-Formula Condition exists for at least 15 consecutive days before another Outof-Formula Condition exists, (ii) the amount of the Revolver Loans outstanding at any time does not exceed the aggregate of the Revolver Commitments at such time, and (iii) the aggregate amount of outstanding Out-of-Formula Loans does not exceed $4,500,000. In no event shall any Borrower be deemed to be a beneficiary of this Section 13.9.4 or authorized to enforce any of the provisions of this Section 13.9.4. 13.10. Due Diligence and Non-Reliance. Each Lender hereby acknowledges and represents that it has, independently and without reliance upon Agent or the other Lenders, and based upon such documents, information and analyses as it has deemed appropriate, made its own credit analysis of each Borrower and its own decision to enter into this Agreement and to fund the Loans to be made by it hereunder and to purchase participations in the LC Obligations pursuant to Section 2.4.2, and each Lender has made such inquiries concerning the Loan Documents, the Collateral and each Borrower as such Lender feels necessary and appropriate, and has taken such care on its own behalf as would have been the case had it entered into the other Loan Documents without the intervention or participation of the other Lenders or Agent. Each Lender hereby further acknowledges and represents that the other Lenders and Agent have not made any representations or warranties to it concerning any Borrower, any of the Collateral or the legality, validity, sufficiency or enforceability of any of the Loan Documents. Each Lender also hereby acknowledges that it will, independently and without reliance upon the other Lenders or Agent, and based upon such financial statements, documents and information as it deems appropriate at the time, continue to make and rely upon its own credit decisions in making Loans and in taking or refraining to take any other action under this Agreement or any of the other Loan Documents. Except for notices, reports and other information expressly required to be furnished to Lenders by Agent hereunder, Agent shall not have any duty or responsibility to provide any Lender with any notices, reports or certificates furnished to Agent by any Borrower or any credit or other information concerning the affairs, financial condition, business or Properties of any Borrower (or any of its Affiliates) which may come into possession of Agent or any of Agentâ&#x20AC;&#x2122;s Affiliates. 13.11. Representations and Warranties of Lenders. Each Lender represents and warrants to each Borrower, Agent and the other Lenders that it has the power to enter into and perform its obligations under the Loan Documents; has taken all necessary action to authorize its execution and performance of the Loan Documents to which it is a party; and none of the consideration used by it to make or fund its Loans or to participate in any other transactions under this Agreement constitutes for any purpose of ERISA or Section 4975 of the Internal Revenue Code assets of any â&#x20AC;&#x153;planâ&#x20AC;? as defined in Section 3(3) of ERISA or Section 4975 of the Internal Revenue Code and the rights and interests of such Lender in and under the Loan Documents shall not constitute plan assets under ERISA. 13.12. The Required Lenders. As to any provisions of this Agreement or the other Loan Documents under which action may or is required to be taken upon direction or approval of the Required Lenders, the direction or approval of the Required Lenders shall be binding upon each Lender to the same extent and with the same effect as if each Lender joined therein. Notwithstanding anything to the contrary contained in this Agreement, Borrowers shall not be 119

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deemed to be a beneficiary of, or be entitled to enforce, sue upon or assert as a defense to any of the Obligations, any provisions of this Agreement that requires Agent or any Lender to act, or conditions their authority to act, upon the direction or consent of the Required Lenders; and any action taken by Agent or any Lender that requires the consent or direction of the Required Lenders as a condition to taking such action shall, insofar as Borrowers are concerned, be presumed to have been taken with the requisite consent or direction of the Required Lenders. 13.13. Several Obligations. The obligations and commitments of each Lender under this Agreement and the other Loan Documents are several and neither Agent nor any Lender shall be responsible for the performance by the other Lenders of its obligations or commitments hereunder or thereunder. Notwithstanding any liability of Lenders stated to be joint and several to third Persons under any of the Loan Documents, such liability shall be shared, as among Lenders, Pro Rata. 13.14. Agent in its Individual Capacity. With respect to its obligation to lend under this Agreement, the Loans made by it, Agent shall have the same rights and powers hereunder and under the other Loan Documents as any other Lender and may exercise the same as though it were not performing the duties specified herein; and the terms “Lenders,” “Required Lenders,” or any similar term shall, unless the context clearly otherwise indicates, include Agent in its capacity as a Lender. Agent and its Affiliates may each accept deposits from, maintain deposits or credit balances for, invest in, lend money to, act as trustee under indentures of, serve as financial advisor to, and generally engage in any kind of business with any Borrower, or any affiliate of any Borrower, as if it were any other bank and without any duty to account therefor (or for any fees or other consideration received in connection therewith) to the other Lenders. WFCF, Wells Fargo or its affiliates may receive information regarding any Borrower or any of such Borrower’s Affiliates and Account Debtors (including information that may be subject to confidentiality obligations in favor of Borrowers or any of their Affiliates) and Lenders acknowledge that neither Agent nor Wells Fargo shall be under any obligation to provide such information to Lenders to the extent acquired by WFCF in its individual capacity and not as Agent hereunder. 13.15. No Third Party Beneficiaries. This Section 13 is not intended to confer any rights or benefits upon Borrowers or any other Person except Lenders and Agent, and no Person (including any or all Borrowers) other than Lenders and Agent shall have any right to enforce any of the provisions of this Section 13 except as expressly provided in Section 13.17. 13.16. Notice of Transfer. Agent may deem and treat a Lender party to this Agreement as the owner of such Lender’s portion of the Loans for all purposes, unless and until a written notice of the assignment or transfer thereof executed by such Lender has been received by Agent. 13.17. Replacement of Certain Lenders. If a Lender (“Affected Lender”) shall have (i) failed to fund its Pro Rata share of any Loan requested (or deemed requested) by Borrowers which such Lender is obligated to fund under the terms of this Agreement and which such failure has not been cured, (ii) requested compensation from Borrowers under Section 3.7 to recover increased costs incurred by such Lender (or its parent or holding company) which are not being incurred generally by the other Lenders (or their respective parents or holding companies), (iii) 120

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defaulted in paying or performing any of its obligations to Agent, or (iv) failed or refused to give its consent to any amendment, waiver or action for which consent of all of the Lenders is required and in respect of which the Required Lenders have consented, then, in any such case and in addition to any other rights and remedies that Agent, any other Lender or any Borrower may have against such Affected Lender, any Borrower or Agent may make written demand on such Affected Lender (with a copy to Agent in the case of a demand by Borrowers and a copy to Borrowers in the case of a demand by Agent) for the Affected Lender to assign, and such Affected Lender shall assign pursuant to one or more duly executed Assignment and Acceptances within 5 Business Days after the date of such demand, to one or more Lenders willing to accept such assignment or assignments, or to one or more Eligible Assignees designated by Agent, all of such Affected Lender’s rights and obligations under this Agreement (including its Revolver Commitment and all Loans owing to it) in accordance with Section 14. Agent is hereby irrevocably authorized to execute one or more Assignment and Acceptances as attorney-in-fact for any Affected Lender which fails or refuses to execute and deliver the same within 5 Business Days after the date of such demand. The Affected Lender shall be entitled to receive, in cash and concurrently with execution and delivery of each such Assignment and Acceptance, all amounts owed to the Affected Lender hereunder or under any other Loan Document, including the aggregate outstanding principal amount of the Loans owed to such Lender, together with accrued interest thereon through the date of such assignment (but excluding any prepayment penalty or termination charge). Upon the replacement of any Affected Lender pursuant to this Section 13.17, such Affected Lender shall cease to have any participation in, entitlement to, or other right to share in the Liens of Agent in any Collateral and such Affected Lender shall have no further liability to Agent, any Lender or any other Person under any of the Loan Documents (except as provided in Section 13.6 as to events or transactions which occur prior to the replacement of such Affected Lender), including any Revolver Commitment to make Loans or purchase participations in LC Obligations. Agent shall have the right at any time, but shall not be obligated to, upon written notice to any Lender and with the consent of such Lender (which may be granted or withheld in such Lender’s discretion), to purchase for Agent’s own account all of such Lender’s right, title and interest in and to this Agreement, the other Loan Documents and the Obligations (together with such Lender’s interest in the Revolver Commitments), for the face amount of the Obligations owed to such Lender (or such greater or lesser amount as Agent and Lender may mutually agree upon). 13.18. Remittance of Payments and Collections. 13.18.1. All payments by any Lender to Agent shall be made not later than the time set forth elsewhere in this Agreement on the Business Day such payment is due. Payment by Agent to any Lender shall be made by wire transfer, promptly following Agent’s receipt of funds for the account of such Lender and in the type of funds received by Agent. 13.18.2. With respect to the payment of any funds from Agent to a Lender or from a Lender to Agent, the party failing to make full payment when due pursuant to the terms hereof shall, on demand by the other party, pay such amount together with interest thereon at the Federal Funds Rate. In no event shall Borrowers be entitled to receive any credit for any interest paid by Agent to any Lender, or by any Lender to Agent, at the Federal Funds Rate as provided herein. 121

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13.18.3. If Agent pays any amount to a Lender in the belief that a related payment has been or will be received by Agent from a Borrower and such related payment is not received by Agent, then Agent shall be entitled to recover such amount from each Lender that receives such amount. If Agent determines at any time that any amount received by it under this Agreement or any of the other Loan Documents must be returned to a Borrower or paid to any other Person pursuant to any Applicable Law, court order or otherwise, then, notwithstanding any other term or condition of this Agreement or any of the other Loan Documents, Agent shall not be required to distribute such amount to any Lender. 13.19. [Reserved] SECTION 14. BENEFIT OF AGREEMENT; ASSIGNMENTS AND PARTICIPATIONS 14.1. Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of Borrowers, Agent and Lenders and their respective successors and assigns (which, in the case of Agent, shall include any successor Agent appointed pursuant to Section 13.8), except that (i) no Borrower shall have the right to assign its rights or delegate performance of any of its obligations under any of the Loan Documents and (ii) any assignment by any Lender must be made in compliance with Section 14.3. Agent may treat the Person which made any Loan as the owner thereof for all purposes hereof unless and until such Person complies with Section 14.3 in the case of an assignment thereof or, in the case of any other transfer, a written notice of the transfer is filed with Agent. Any assignee or transferee of any rights with respect to any Loan agrees by acceptance thereof to be bound by all the terms and provisions of the Loan Documents. Any request, authority or consent of any Person, who at the time of making such request or giving such authority or consent is the holder of a Note, shall be conclusive and binding on any subsequent holder, transferee or assignee of such Note or of any Note or Notes issued in exchange therefor. 14.2.

Participations.

14.2.1. Permitted Participants; Effect. Any Lender may, in the ordinary course of its business and in accordance with Applicable Law, at any time sell to one or more banks or other financial institutions (each a “Participant”) a participating interest in any of the Obligations owing to such Lender, any Revolver Commitment of such Lender or any other interest of such Lender under any of the Loan Documents. In the event of any such sale by a Lender of participating interests to a Participant, such Lender’s obligations under the Loan Documents shall remain unchanged, such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations, such Lender shall remain the holder of its Loans and Revolver Commitments for all purposes under the Loan Documents, all amounts payable by Borrowers under this Agreement shall be determined as if such Lender had not sold such participating interests, and Borrowers and Agent shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under the Loan Documents. If a Lender sells a participation to a Person other than an Affiliate of such Lender, then such Lender shall give prompt written notice thereof to Borrowers and the other Lenders. A Participant that would be a Foreign Lender if it were a Lender shall not be entitled to the benefits 122

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of Section 5.9 unless Borrowers are notified of the participation sold to Participant and such Participant agrees to comply with Section 5.10 as though such Participant were a Lender. 14.2.2. Voting Rights. Each Lender shall retain the sole right to approve, without the consent of any Participant, any amendment, modification or waiver of any provision of the Loan Documents other than an amendment, modification or waiver with respect to any Loans or Revolver Commitment in which such Participant has an interest which forgives principal, interest or fees or reduces the stated interest rate or the stated rates at which fees are payable with respect to any such Loan or Revolver Commitment, postpones the Commitment Termination Date, or any date fixed for any regularly scheduled payment of interest or fees on such Loan or Revolver Commitment, or releases from liability any Borrower or releases any substantial portion of any of the Collateral. 14.2.3. Benefit of Set-Off. Each Borrower agrees that each Participant shall be deemed to have the right of set-off provided in Section 12.4 in respect of its participating interest in amounts owing under the Loan Documents to the same extent and subject to the same requirements under this Agreement (including Section 13.5) as if the amount of its participating interest were owing directly to it as a Lender under the Loan Documents, provided, that, each Lender shall retain the right of set-off provided in Section 12.4 with respect to the amount of participating interests sold to each Participant. Lenders agree to share with each Participant, and each Participant by exercising the right of set-off provided in Section 12.4 agrees to share with each Lender, any amount received pursuant to the exercise of its right of set-off, such amounts to be shared in accordance with Section 13.5 as if each Participant were a Lender. 14.3.

Assignments.

14.3.1. Permitted Assignments. Subject to its compliance with Section 14.3.2, a Lender may, in accordance with Applicable Law, at any time assign to any Eligible Assignee all or any part of its rights and obligations under the Loan Documents, so long as (i) each assignment is of a constant, and not a varying, ratable percentage of all of the transferor Lenderâ&#x20AC;&#x2122;s rights and obligations under the Loan Documents with respect to the Loans and the LC Obligations and, in the case of a partial assignment, is in a minimum principal amount of $5,000,000 (unless otherwise agreed by Agent in its sole discretion) and integral multiples of $1,000,000 in excess of that amount; (ii) except in the case of an assignment in whole of a Lenderâ&#x20AC;&#x2122;s rights and obligations under the Loan Documents or an assignment by one original signatory to this Agreement to another such signatory, immediately after giving effect to any assignment, the aggregate amount of the Revolver Commitments retained by the transferor Lender shall in no event be less than $10,000,000 (unless otherwise agreed by Agent in its sole discretion); and (iii) the parties to each such assignment shall execute and deliver to Agent, for its acceptance and recording, an Assignment and Acceptance. 14.3.2. Effect; Effective Date. Upon (i) delivery to Agent of a notice of assignment substantially in the form attached as Exhibit H hereto, together with any consents required by Section 14.3.1, and (ii) payment of a $4,000 fee to the Agent for processing any assignment to an Eligible Assignee that is not an Affiliate of the transferor Lender, such assignment shall become effective on the effective date specified in such notice of assignment. 123

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The Assignment and Acceptance shall contain a representation and warranty by the Eligible Assignee that the assignment evidenced thereby will not result in a non-exempt “prohibited transaction” under Section 406 of ERISA. On and after the effective date of such assignment, such Eligible Assignee shall for all purposes be a Lender party to this Agreement and any other Loan Document executed by the Lenders and shall have all the rights and obligations of the Lender under the Loan Documents to the same extent as if it were an original party thereto, and no further consent or action by Borrowers, Lenders or Agent shall be required to release the transferor Lender with respect to the Revolver Commitment (or portion thereof) of such Lender and Obligations assigned to such Eligible Assignee. Upon the consummation of any assignment to an Eligible Assignee pursuant to this Section 14.3, the transferor Lender, Agent and Borrowers shall make appropriate arrangements so that replacement Notes are issued to such transferor Lender and new Notes are issued to such Eligible Assignee, in each case in principal amounts reflecting their respective Commitments, as adjusted pursuant to such assignment, to the extent, in each case, that the transferor Lender is the holder of a Note prior to the assignment or requests issuance of a Note in connection with such assignment, and the Eligible Assignee requests a Note, as applicable. If the transferor Lender shall have assigned all of its interests, rights and obligations under this Agreement pursuant to Section 14.3.1, then (i) such transferor Lender shall no longer have any obligation to indemnify Agent with respect to any transactions, events or occurrences that transpire after the effective date of such assignment, (ii) each Eligible Assignee to which such transferor Lender shall make an assignment shall be responsible to Agent to indemnify Agent in accordance with this Agreement with respect to transactions, events and occurrences transpiring on and after the effective date of such assignment to it, and (iii) the transferor Lender shall continue to be entitled to the benefits of those provisions of the Loan Documents (including indemnities from Borrowers) that survive Full Payment of the Obligations. 14.3.3. Dissemination of Information. Each Borrower authorizes each Lender and Agent to disclose to any Participant, any Eligible Assignee or any other Person acquiring an interest in the Loan Documents by operation of law (each a “Transferee”), and any prospective Transferee, any and all information in Agent’s or such Lender’s possession concerning each Borrower, the Subsidiaries of each Borrower or the Collateral, subject to appropriate confidentiality undertakings on the part of such Transferee. SECTION 15. MISCELLANEOUS 15.1. Power of Attorney. Each Borrower hereby irrevocably designates, makes, constitutes and appoints Agent (and all Persons designated by Agent) as such Borrower’s true and lawful attorney (and agent-in-fact) and Agent, or Agent’s designee, may, without notice to such Borrower and in either such Borrower’s or Agent’s name, but at the cost and expense of Borrowers: 15.1.1. At such time or times as Agent or said designee, in its sole discretion, may determine, endorse such Borrower’s name on any Payment Item or other proceeds of the Collateral which come into the possession of Agent or under Agent’s control.

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15.1.2. At any time that an Event of Default exists: (i) demand payment of the Accounts from the Account Debtors, enforce payment of the Accounts by legal proceedings or otherwise, and generally exercise all of such Borrower’s rights and remedies with respect to the collection of the Accounts; (ii) settle, adjust, compromise, discharge or release any of the Accounts or other Collateral or any legal proceedings brought to collect any of the Accounts or other Collateral; (iii) sell or assign any of the Accounts and other Collateral upon such terms, for such amounts and at such time or times as Agent deems advisable; (iv) take control, in any manner, of any item of payment or proceeds relating to any Collateral; (v) prepare, file and sign such Borrower’s name to a proof of claim in bankruptcy or similar document against any Account Debtor or to any notice of Lien, assignment or satisfaction of Lien or similar document in connection with any of the Collateral; (vi) receive, open and dispose of all mail addressed to such Borrower and to notify postal authorities to change the address for delivery thereof to such address as Agent may designate; (vii) endorse the name of such Borrower upon any Payment Item relating to any Collateral and deposit the same to the account of Agent for application to the Obligations; (viii) endorse the name of such Borrower upon any Chattel Paper, Document, Instrument, invoice, freight bill, bill of lading or similar document or agreement relating to any Accounts or Inventory of any Borrower and any other Collateral; (ix) use such Borrower’s stationery and sign the name of such Borrower to verifications of the Accounts and notices thereof to Account Debtors; (x) use the information recorded on or contained in any data processing equipment and computer hardware and software relating to any Collateral; (xi) make and adjust claims under policies of insurance; (xii) sign the name of such Borrower to and file any proof of claim in an Insolvency Proceeding of any Account Debtor and on notices of Liens, claims of mechanic’s Liens or assignments or releases of mechanic’s Liens securing any Accounts; (xiii) take all action as may be necessary to obtain the payment of any letter of credit or banker’s acceptance of which such Borrower is a beneficiary; and (xiv) do all other acts and things necessary, in Agent’s determination, to fulfill such Borrower’s obligations under any of the Loan Documents. 15.2. General Indemnity. Whether or not any of the transactions contemplated by any of the Loan Documents are consummated, each Borrower agrees to indemnify and defend the Indemnities and hold the Indemnities harmless from and against any Claims that may be instituted or asserted against or are incurred by any of the Indemnitees. Without limiting the generality of the foregoing, this indemnity shall extend to any Claims instituted or asserted against or incurred by any of the Indemnitees (x) under any Environmental Laws or (other similar laws by reason of a Borrower’s or any other Person’s failure to comply with laws applicable to solid or hazardous waste materials or other toxic substances) or (y) under any AntiTerrorism Laws, including any fines assessed against Agent or any Lender by any Governmental Authority as a result of conduct of a Borrower. Additionally, if any Taxes (including any intangibles tax, stamp tax, recording tax or franchise tax, but excluding any Taxes that are indemnified pursuant Section 5.9 or would have been indemnified pursuant to Section 5.9 but for an applicable exemption or exclusion) shall be payable by any party on account of the execution or delivery of this Agreement, or the execution, delivery, issuance or recording of any of the other Loan Documents, or the creation or repayment of any of the Obligations hereunder, by reason of any Applicable Law now or hereafter in effect, Borrowers shall pay (and shall promptly reimburse Agent and Lenders for their payment of) all such Taxes, including any interest and penalties thereon, and will indemnify and hold Indemnitees harmless from and 125

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against all liability in connection therewith. No Indemnitee shall have any right to indemnification for any of the foregoing to the extent determined by a final and nonappealable judgment of a court of competent jurisdiction to have resulted from (A) the gross negligence or willful misconduct (including fraud) of such Indemnitee, or (B) any dispute solely among Indemnitees other than claims against any Indemnitee in its capacity or in fulfilling its role as an Agent under this Agreement and other than any claims arising out of any act or omission on the part of any Borrower or its Affiliates. For purposes of this Section 15.2, “Indemnitees” shall not include the Co-Collateral Agent. 15.3. Survival of and Limitations Upon Indemnities. Notwithstanding anything to the contrary in this Agreement or any of the other Loan Documents, the obligation of each Borrower and each Lender with respect to each indemnity given by it in this Agreement shall survive the Full Payment of the Obligations, the termination of any of the Revolver Commitments and the resignation of Agent. Notwithstanding anything to the contrary contained in this Agreement, no party shall have any obligation under this Agreement to indemnify an Indemnitee with respect to any Claim to the extent that it is determined in a final, non-appealable judgment by a court of competent jurisdiction that such Claim resulted from the gross negligence or willful misconduct of such Indemnitee or the material breach of such Indemnitee’s obligations under the Loan Documents. 15.4. Modification of Agreement. This Agreement may not be modified, altered or amended, except to the extent permitted by the DIP Order, and then, only by an agreement in writing signed by Borrowers, Agent and Lenders (or, where otherwise expressly allowed by Section 13, the Required Lenders in lieu of Agent and Lenders); provided, however, that no consent, written or otherwise, of Borrowers shall be necessary or required in connection with any amendment of any of the provisions of Sections 2.4.2, 4.1.3, 5.6, or 13 (other than Section 13.17), or any other provision of this Agreement that affects only the rights, duties and responsibilities of Lenders and Agent as among themselves so long as no such amendment imposes any additional obligations on Borrowers. 15.5. Severability. Wherever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under Applicable Law, but if any provision of this Agreement shall be prohibited by or invalid under Applicable Law, such provision shall be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Agreement. 15.6. Cumulative Effect; Conflict of Terms. The provisions of the Other Agreements and the Security Documents are hereby made cumulative with the provisions of this Agreement. Without limiting the generality of the foregoing, the parties acknowledge that this Agreement and the other Loan Documents may use several different limitations, tests or measurements to regulate the same or similar matters and that such limitations, tests and measures are cumulative and each must be performed, except as may be expressly stated to the contrary in this Agreement. Except as otherwise provided in any of the other Loan Documents by specific reference to the applicable provision of this Agreement, if any provision contained in this Agreement is in direct conflict with, or inconsistent with, any provision in any of the other Loan Documents, the provision contained in this Agreement shall govern and control. 126

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15.7. Counterparts; Facsimile Signatures. This Agreement and any amendments hereto may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed and delivered shall be deemed to be an original and all of which counterparts taken together shall constitute but one and the same instrument. Loan Documents may be executed by facsimile or electronic mail and the effectiveness of any such Loan Documents and signatures thereon shall, subject to Applicable Law, have the same force and effect as manually signed originals and shall be binding on all parties thereto. Agent may require that any such documents and signatures be confirmed by a manually-signed original thereof, provided, that, the failure to request or deliver the same shall not limit the effectiveness of any facsimile or electronic signature. 15.8. Consent. Whenever the consent of Agent or Lenders (or any combination of Lenders) is required to be obtained under this Agreement or any of the other Loan Documents as a condition to any action, inaction, condition or event, each party whose consent is required shall be authorized to give or withhold its consent in its sole and absolute discretion and to condition its consent upon the giving of additional collateral security for the Obligations, the payment of money or any other matter. 15.9.

Notices and Communications.

15.9.1. Except as otherwise provided in Section 4.15, all notices, requests and other communications to or upon a party hereto shall be in writing (including facsimile transmission or similar writing) and shall be given to such party at the address or facsimile number for such party on the signature pages hereof (or, in the case of a Person who becomes a Lender after the date hereof, at the address shown on the applicable Assignment and Acceptance by which such Person became a Lender) or at such other address or facsimile number as such party may hereafter specify for the purpose by notice to Agent and Borrowers in accordance with the provisions of this Section 15.9. 15.9.2. Except as otherwise provide in Section 4.1.5, each such notice, request or other communication shall be effective (i) if given by facsimile transmission, when transmitted to the facsimile number specified herein for the noticed party and confirmation of receipt is received, (ii) if by certified mail, upon receipt by Agent, or (iii) if given by personal delivery, when duly delivered with receipt acknowledged in writing by the noticed party. In no event shall a voicemail message be effective as a notice, communication or confirmation under any of the Loan Documents. Notwithstanding the foregoing, no notice to or upon Agent or WFCF pursuant to Sections 2.4, 3.1.2, 4.1 or 6.2.2 shall be effective until after actually received by the individual to whose attention at Agent such notice is required to be sent. Any written notice, request or demand that is not sent in conformity with the provisions hereof shall nevertheless be effective on the date that such notice, request or demand is actually received by the individual to whose attention at the noticed party such notice, request or demand is required to be sent. Any notice received by Borrower Agent shall be deemed to have been received by all Borrowers. 15.9.3. Electronic mail and intranet websites may be used only to distribute routine communications, such as financial statements, Borrowing Base Certificates and other 127

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information required by Section 10.1.3, and to distribute Loan Documents for execution by the parties thereto and acceptance thereof, and may not be used for any other purpose as effective notice under this Agreement or any of the other Loan Documents. Agent and Lenders shall be authorized to rely and act upon any notices (including telephonic communications) purportedly given by or on behalf of any Borrower even if such notices were made in a manner other than as specified herein, were incomplete or were not preceded or followed by any other form of notice specified or required herein, or the terms thereof, as understood by the recipient, varied from any confirmation thereof. Borrowers agree to indemnify and defend each Indemnitee from all losses, costs, expenses and liabilities resulting from the reliance by any such Indemnitee on each telephone communication purportedly given by or on behalf of any Borrower. 15.10. Performance of Borrowers’ Obligations. If any Borrower shall fail to discharge any covenant, duty or obligation hereunder or under any of the other Loan Documents, Agent may, in its sole discretion at any time or from time to time, for such Borrower’s account and at Borrowers’ expense, pay any amount or do any act required of Borrowers hereunder or under any of the other Loan Documents or otherwise lawfully requested by Agent to (i) enforce any of the Loan Documents or collect any of the Obligations, (ii) preserve, protect, insure or maintain or realize upon any of the Collateral, or (iii) preserve, defend, protect or maintain the validity or priority of Agent’s Liens in any of the Collateral, including the payment of any judgment against any Borrower, any insurance premium, any warehouse charge, any finishing or processing charge, any landlord claim, any other Lien upon or with respect to any of the Collateral (whether or not a Permitted Lien). All payments that Agent may make under this Section and all out-ofpocket costs and expenses (including Extraordinary Expenses) that Agent pays or incurs in connection with any action taken by it hereunder shall be reimbursed to Agent by Borrowers on demand with interest from the date such payment is made or such costs or expenses are incurred to the date of payment thereof at the Default Rate applicable for Revolver Loans that are Base Rate Loans. Any payment made or other action taken by Agent under this Section shall be without prejudice to any right to assert, and without waiver of, an Event of Default hereunder and to without prejudice to Agent’s right proceed thereafter as provided herein or in any of the other Loan Documents. 15.11. Indulgences Not Waivers. Agent’s or any Lender’s failure at any time or times hereafter, to require strict performance by Borrowers of any provision of this Agreement shall not waive, affect or diminish any right of Agent or any Lender thereafter to demand strict compliance and performance therewith. 15.12. Entire Agreement; Exhibits and Schedules. This Agreement (including all Exhibits and Schedules hereto) and the other Loan Documents, together with all other instruments, agreements and certificates executed by the parties pursuant to any Loan Document, embody the entire understanding and agreement between the parties hereto and thereto with respect to the subject matter hereof and thereof and supersede all prior agreements, understandings and inducements, whether express or implied, oral or written, regarding the same subject matter. 128

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15.13. Interpretation. No provision of this Agreement or any of the other Loan Documents shall be construed against or interpreted to the disadvantage of any party hereto by any court or other governmental or judicial authority by reason of such party having, or being deemed to have, structured, drafted or dictated such provision. The paragraph and section headings are for convenience of reference only and shall not affect the substantive meaning of any provision of this Agreement. 15.14. Time of Essence. Time is of the essence of this Agreement and the other Loan Documents. 15.15. Obligations of Lenders Several. The obligations of each Lender hereunder are several, and no Lender shall be responsible for the obligations or Revolver Commitment of any other Lender. Nothing contained in this Agreement and no action taken by Lenders pursuant hereto shall be deemed to constitute the Lenders to be a partnership, association, joint venture or any other kind of entity. 15.16. Confidentiality. Agent and Lenders each agrees to take normal and reasonable precautions to maintain the confidentiality of any confidential information that is delivered or made available by Borrowers to it, (including information made available to Agent or any Lender in connection with a visit or investigation by any Person contemplated in Section 10.1.1), for a period of 24 months following the Commitment Termination Date, except that Agent and any Lender may disclose such information (i) to their respective Affiliates and individuals employed or retained by Agent or such Lender who are or are expected to become engaged in evaluating, approving, structuring, administering or otherwise giving professional advice with respect to any of the Loans or Collateral, including any of their respective legal counsel, auditors or other professional advisors so long as such Person has agreed to be bound by the provisions of this Section, (ii) to any party to this Agreement from time to time or any Participant, (iii) pursuant the order of any court or administrative agency, (iv) upon the request or demand of any regulatory agency or other Governmental Authority having jurisdiction over Agent or such Lender or in accordance with Agent’s or Lender’s regulatory compliance policies, (v) which has ceased to be confidential other than by an act or omission of Agent or any Lender except as permitted herein or which becomes available to Agent or any Lender on a nonconfidential basis from a source other than Borrowers, (vi) to the extent reasonably required in connection with any litigation (with respect to any of the Loan Documents or any of the transactions contemplated thereby) to which Agent, any Lender or their respective Affiliates may be a party, (vii) to the extent reasonably required in connection with the exercise of any remedies hereunder, (viii) to any actual or proposed Participant, Assignee, counterparty or advisors to any swap or derivative transactions relating to Borrowers and the Obligations, or any other Transferee of all or part of a Lender’s rights hereunder so long as such Person has agreed in writing to be bound by the provisions of this Section, (ix) to the National Association of Insurance Commissioners or any similar organization or to any nationally recognized rating agency that requires access to information about a Lender’s portfolio in connection with ratings issued with respect to such Lender, (x) to the extent required (on the advice of Agent’s or such Lender’s counsel) by Applicable Law, including, without limitation, the Bankruptcy Code or Bankruptcy Rules, or (xi) with the consent of Borrowers. 129

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15.17. Governing Law. This Agreement shall be governed by and construed in accordance with the internal laws (but without regard to conflict of law provisions) of the State of New York. 15.18. Credit Inquiries. Each Borrower hereby authorizes Agent and Lenders (but they shall have no obligation) to respond to usual and customary credit inquiries from third parties concerning any Borrower or any Subsidiary. 15.19. Consent to Forum. Each Borrower hereby consents to the exclusive jurisdiction of the Bankruptcy Court in any action, suit or other proceeding arising out of or relating to this Agreement or any of the other Loan Documents and each Borrower irrevocably agrees that all claims and demands in respect of any such action, suit or proceeding may be heard and determined in any such court and irrevocably waives any objection it may now or hereafter have as to the venue of any such action, suit or proceeding brought in any such court or that such court is an inconvenient forum. Nothing herein shall limit the right of Agent or any Lender to bring proceedings against any Borrower in the courts of any other jurisdiction. Any judicial proceeding commenced by any Borrower against Agent, WFCF, any Lender or any holder of any of the Obligations, or any Affiliate of Agent, WFCF, any Lender or any holder of any Obligations, involving, directly or indirectly, any matter in any way arising out of, related to or connected with any Loan Document shall be brought only in the Bankruptcy Court. Nothing in this Agreement shall be deemed or operate to affect the right of Agent to serve legal process in any other manner permitted by law or to preclude the enforcement by Agent of any judgment or order obtained in such forum or the taking of any action under this Agreement to enforce same in any other appropriate forum or jurisdiction. 15.20. Waivers by Borrowers. To the fullest extent permitted by Applicable Law, and subject to the terms of the DIP Order, each Borrower waives (i) the right to trial by jury (which Agent and each Lender hereby also waives) in any action, suit, proceeding or counterclaim of any kind arising out of or related to any of the Loan Documents, the Obligations or the Collateral; (ii) presentment, demand and protest and notice of presentment, protest, default, non-payment, maturity, release, compromise, settlement, extension or renewal of any or all commercial paper, accounts, contract rights, documents, instruments, chattel paper and guaranties at any time held by Agent on which such Borrower may in any way be liable and hereby ratifies and confirms whatever Agent may do in this regard; (iii) notice prior to taking possession or control of the Collateral or any bond or security which might be required by any court prior to allowing Agent to exercise any of Agent’s remedies; (iv) the benefit of all valuation, appraisement and exemption laws; (v) any claim against Agent or any Lender, on any theory of liability, for special, indirect, consequential, exemplary or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, any of the Loan Documents, any transaction thereunder or the use of the proceeds of any Loans; and (vi) notice of acceptance hereof. Each Borrower acknowledges that the foregoing waivers are a material inducement to Agent’s and Lender’s entering into this Agreement and that Agent and Lenders are relying upon the foregoing waivers in its future dealings with Borrowers. Each Borrower warrants and represents that it has reviewed the foregoing waivers with its legal counsel and has knowingly and voluntarily waived its jury trial rights following 130

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consultation with legal counsel. In the event of litigation, this Agreement may be filed as a written consent to a trial by the Bankruptcy Court. 15.21. [Reserved] 15.22. Keepwell. Each Borrower hereby jointly and severally absolutely, unconditionally and irrevocably undertakes to provide such funds or other support as may be needed from time to time by each other Borrower to honor all of its obligations under this Agreement in respect of Swap Obligations (provided, however, that, each Borrower shall only be liable under this Section 15.22 for the maximum amount of such liability that can be hereby incurred without rendering its obligations under this Section 15.22, or otherwise under this Agreement or the Loan Documents, voidable under applicable law relating to fraudulent conveyance or fraudulent transfer, and not for any greater amount). The obligations of each Borrower under this Section 15.22 shall remain in full force and effect until the Full Payment of the Obligations. Each Borrower intends that this Section 15.22 constitute, and this Section 15.22 shall be deemed to constitute, a “keepwell, support, or other agreement” for the benefit of each other Borrower for all purposes of Section 1a(18)(A)(v)(II) of the Commodity Exchange Act. 15.23. Agent and Lenders as Parties-in-Interest. Each Borrower hereby stipulates and agrees that Agent and each Lender is and shall remain a party in interest in the Chapter 11 Cases and shall have the right to participate, object and be heard in any motion or proceeding in connection therewith. Nothing in this Agreement or any other Loan Document shall be deemed to be a waiver of any of Agent’s or any Lender’s rights or remedies under applicable law or documentation. Without limitation of the foregoing, Agent and each Lender shall have the right to make any motion or raise any objection it deems to be in its interest (specifically including but not limited to objections to use of proceeds of the Revolver Loans, to payment of professional fees and expenses or the amount thereof, to sales or other transactions outside the ordinary course of business or to assumption or rejection of any executory contract or lease), provided that neither Agent nor any Lender will exercise such right if the action or inaction by Borrowers (or any of them) which is the subject of such motion or objection is expressly permitted by any covenant or provision of this Agreement. 15.24. Waiver of Right to Obtain Alternative Financing. In consideration of the Revolver Loans to be made to Borrowers by Agent and the Lenders, each Borrower hereby waives any right it may have to obtain an order by the Bankruptcy Court (other than the Permitted Junior DIP Order) authorizing such Borrower to obtain financing pursuant to Section 364 of the Bankruptcy Code from any Person other than Agent and Lenders, unless such financing would result in Full Payment of all of the Obligations and the Prepetition Senior Obligations. 15.25. Credit Bids. Agent and each Lender shall maintain its right to credit bid their respective claims under the this Agreement or the DIP Order pursuant to Section 363(k) of the Bankruptcy Code, and each Borrower agrees that it shall not object to Agent’s or any Lender’s right to credit bid.

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15.26. Conflict of Terms. If any provision in this Agreement or any other Loan Document conflicts with any provision in the DIP Order, the provision in the DIP Order shall govern and control. [Remainder of page intentionally left blank; signatures begin on following page]

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IN WITNESS WHEREOF, this Agreement has been duly executed and delivered as of the date first above written. CLOTHESLINE HOLDINGS, INC. a Delaware corporation, as Holdings and as a Borrower

By: Name: Title:

____________________________ John Makuch Authorized Signatory

Address: 1105 Lakewood Parkway, Suite 210 Alpharetta, GA 30009 Attention: John Makuch

ANGELICA CORPORATION a Missouri corporation, as a Borrower

By: Name: Title:

____________________________ David A. Van Vliet President

Address: 1105 Lakewood Parkway, Suite 210 Alpharetta, GA 30009 Attention: John Makuch

ANGELICA TEXTILE SERVICES, INC. a California corporation, as a Borrower

By: Name: Title:

____________________________ David A. Van Vliet President

Address: 1105 Lakewood Parkway, Suite 210 Alpharetta, GA 30009 Attention: John Makuch

[Signature page to Credit Agreement]

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ANGELICA TEXTILE SERVICES, INC. a New York corporation, as a Borrower

By: Name: Title:

____________________________ David A. Van Vliet President

Address: 1105 Lakewood Parkway, Suite 210 Alpharetta, GA 30009 Attention: John Makuch

ROYAL INSTITUTIONAL SERVICES, INC. a Massachusetts corporation, as a Borrower

By: Name: Title:

____________________________ David A. Van Vliet President

Address: 1105 Lakewood Parkway, Suite 210 Alpharetta, GA 30009 Attention: John Makuch

[Signature page to Credit Agreement]

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Exhibit B Interim Order

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UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK

In re:

Chapter 11

ANGELICA CORPORATION, et. al.1

Case No. 17-10870 (JLH)

Debtors.

(Joint Administration Pending)

INTERIM ORDER (I) AUTHORIZING THE DEBTORS TO OBTAIN POST-PETITION SECURED FINANCING PURSUANT TO 11 U.S.C. § 364, (II) AUTHORIZING THE DEBTORS’ LIMITED USE OF CASH COLLATERAL PURSUANT TO 11 U.S.C. § 363, (III) GRANTING ADEQUATE PROTECTION TO PREPETITION SECURED LENDERS PURSUANT TO 11 U.S.C. §§ 361, 362, 363 AND 364, AND (IV) SCHEDULING FINAL HEARING PURSUANT TO BANKRUPTCY RULE 4001 Upon the motion of the debtors and debtors-in-possession (collectively, the “Debtors”) in the above-captioned chapter 11 cases (the “Chapter 11 Cases”), dated April 3, 2017 (the “Motion”), (a) seeking the entry of this interim order (this “Order”) and a final order (the “Final Order”): (i) authorizing Angelica Corporation (a Missouri corporation) (“Angelica” or “Borrower Representative”), Clothesline Holdings, Inc. (a Delaware corporation) (“Holdings”), Angelica Textile Services, Inc. (a California corporation) (“Services CA”), Angelica Textile Services, Inc. (a New York corporation) (“Services NY”), and Royal Institutional Services, Inc. (a Massachusetts corporation) (“RIS” and together with Angelica, Holdings, Services CA, Services NY, and RIS, in such capacity as postpetition borrowers, collectively, the “Borrowers” and individually, a “Borrower”) to obtain senior secured postpetition financing in an aggregate principal amount not to exceed $65,000,000 (the “Postpetition Facility”), pursuant to section 364 of title 11 of the United States Code, 11 U.S.C. §§ 101, et seq. 1 The Debtors in these chapter 11 cases, along with the last four digits of each Debtor’s federal tax identification number, are as follows: Angelica Corporation (5260); Clothesline Holdings, Inc. (1081); Angelica Textile Services, Inc.–NY (6508); Royal Institutional Services, Inc. (8906); and Angelica Textile Services, Inc.–CA (5010). The location of the Debtors’ corporate headquarters is 1105 Lakewood Parkway, Suite 210, Alpharetta, Georgia 30009. WEIL:\96084664\2\15465.0003

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(the “Bankruptcy Code”), from Wells Fargo Capital Finance, LLC (in its individual capacity, “Wells Fargo”), as administrative agent and collateral agent (in such capacity, the “Postpetition Agent”) for itself and Regions Bank (collectively with Wells Fargo, the “Postpetition Lenders”), pursuant to the terms of this Order and that certain Senior Secured, Super-Priority Debtor-In-Possession Loan and Security Agreement, dated as of April 3, 2017, by and among each Borrower, the Postpetition Agent, and the Postpetition Lenders, in substantially the form attached to the Motion as Exhibit A (as the same may be amended, restated, supplemented or otherwise modified from time to time, the "Postpetition Loan Agreement”);2 (ii) authorizing the Debtors to execute, deliver and enter into the Postpetition Loan Agreement and other Postpetition Loan Documents (as defined in paragraph 2 below) and to perform such other and further acts as may be required in connection with the Postpetition Loan Documents; (iii) granting security interests, liens, and superpriority claims (including a superpriority administrative claim pursuant to section 364(c)(1) of the Bankruptcy Code, liens pursuant to sections 364(c)(2) and 364(c)(3) of the Bankruptcy Code, and priming liens pursuant to section 364(d) of the Bankruptcy Code) to the Postpetition Agent, for the benefit of itself and the Postpetition Lenders, to secure all obligations of the Debtors under and with respect to the Postpetition Facility; (iv) authorizing the Debtors’ limited use of Cash Collateral (as defined in paragraph E below), solely on the terms and conditions set forth in this Order and in the Postpetition Loan Documents; (v) granting adequate protection to the Prepetition Senior Lenders and Prepetition Junior Lenders (as defined in paragraph D3 below), whose liens and security interests are being primed by the Postpetition Facility, as more fully set forth in this Order; and (vi) modifying the automatic stay imposed under section 362 of the Bankruptcy Code; (b)

Capitalized terms used but not defined herein shall have the meaning assigned to such terms in the Postpetition Loan Agreement. References to paragraphs of this Order and to sections and paragraphs of any other document are for convenience only and for compliance with any applicable Local Bankruptcy Rules of this Court, and are in no way a waiver of any other applicable provisions of this Order or such document. Such references are also deemed to include and incorporate all subparts of any referenced section or paragraph.

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requesting, pursuant to Rule 4001 of the Federal Rules of Bankruptcy Procedure (the “Bankruptcy Rules”) and the applicable Local Bankruptcy Rules of this Court, that an emergency interim hearing (the “Interim Hearing”) on the Motion be held before this Court to consider entry of this Order, which authorizes the Debtors to borrow under the Postpetition Loan Documents, on an interim basis, up to an aggregate principal amount not to exceed $37,625,000; and (c) requesting, pursuant to Bankruptcy Rules 4001(b)(2) and 4001(c)(2) and the applicable Local Bankruptcy Rules of this Court, that this Court (i) schedule a final hearing (the “Final Hearing”) on the Motion as set forth in paragraph 37 below to consider entry of the Final Order authorizing the balance of the borrowings and letter of credit issuances under the Postpetition Loan Documents on a final basis, and (ii) approve notice procedures with respect thereto; and the Interim Hearing having been held before this Court; and this Court having considered the Motion and all pleadings related thereto, including the record made by the Debtors at the Interim Hearing; and after due deliberation and consideration, and good and sufficient cause appearing therefor: THIS COURT HEREBY FINDS AND CONCLUDES AS FOLLOWS:4 A.

Commencement of Cases. On April 3, 2017 (the “Petition Date”), each

Debtor filed with this Court a voluntary petition for relief under chapter 11 of the Bankruptcy Code.

The Debtors are continuing to operate their business and manage their respective

properties as debtors-in-possession pursuant to sections 1107(a) and 1108 of the Bankruptcy Code. No request has been made for the appointment of a trustee or examiner, and no creditors’ committee (the “Creditors’ Committee”) has yet been appointed in the Chapter 11 Cases. B.

Jurisdiction; Venue. This Court has jurisdiction over the Chapter 11 Cases

and the Motion pursuant to 28 U.S.C. §§ 157(b) and 1334. Consideration of the Motion constitutes a core proceeding pursuant to 28 U.S.C. § 157(b)(2). The statutory predicates for the

4 Pursuant to Bankruptcy Rule 7052, any findings of fact contained herein that may be construed as matters of law shall be treated as conclusions of law as if set forth below, and vice versa.

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relief sought herein are sections 105, 361, 362, 363, and 364 of the Bankruptcy Code and Rules 2002, 4001 and 9014 of the Federal Rules of Bankruptcy Procedure. Venue of the Chapter 11 Cases in this District is proper pursuant to 28 U.S.C. §§ 1408 and 1409. C.

Adequate Notice. On the Petition Date, the Debtors filed the Motion with

this Court and pursuant to Bankruptcy Rules 2002, 4001 and 9014, and the Local Bankruptcy Rules of this Court, the Debtors have provided notice of the Motion and the Interim Hearing as set forth in the Motion. Given the nature of the relief sought in the Motion, this Court concludes that the notice was sufficient and adequate under the circumstances and complies with the Bankruptcy Code, the Bankruptcy Rules, and any other applicable law, and no further notice relating to this proceeding is necessary or required. D. (a)

Prepetition Loan Documents, Liens and Claims.

Without prejudice to the rights of any other party, but subject to the time

limitations specified in paragraph 30 of this Order, the Debtors admit, stipulate and agree that, on and as of the Petition Date, the Debtors were indebted and bound as described below: Prepetition Senior Agent and Prepetition Senior Lenders 1. Pursuant to that certain Loan and Security Agreement, dated as of July15, 2011 (as amended, restated, supplemented or otherwise modified from time to time, the “Prepetition Senior Loan Agreement”), among each Borrower (with Holdings party thereto as a guarantor), Wells Fargo, as administrative agent and collateral agent for itself and the Prepetition Senior Lenders (as defined below) (in such capacity, the “Prepetition Senior Agent”), and the other lenders party thereto (collectively, together with the Secured Parties (as defined in the Prepetition Senior Loan Agreement), the “Prepetition Senior Lenders”), the Prepetition Senior Agent and Prepetition Senior Lenders agreed to extend loans to, issue letters of credit for, and provide services and other credit accommodations to, the Borrowers. The Prepetition Senior Loan Agreement, along with any other agreements and documents executed or delivered in connection therewith, including, without limitation, the “Loan Documents” as defined therein, are collectively referred to herein as the “Prepetition Senior Loan Documents” (as the same may be amended, restated, supplemented or otherwise modified from time to time). 2. All obligations of the Debtors arising under, or in connection with, the Prepetition Senior Loan Agreement (including, without limitation, the “Obligations” and “Banking Relationship Debt”, each as defined therein), any other Prepetition Senior Loan

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Document, and/or any document executed in connection with any Banking Relationship Debt shall collectively be referred to herein as the “Prepetition Senior Obligations.” 3. Pursuant to the Security Documents (as defined in the Prepetition Senior Loan Agreement) (as such documents are amended, restated, supplemented or otherwise modified from time to time, the “Prepetition Senior Security Documents”), by and between each of the Debtors and the Prepetition Senior Agent, each Debtor granted to the Prepetition Senior Agent, for the benefit of itself and the Prepetition Senior Lenders, to secure the Prepetition Senior Obligations, a first priority security interest in and continuing lien (the “Prepetition Senior Liens”) on substantially all of such Debtor’s assets and property, and all proceeds, products, accessions, rents and profits thereof, in each case whether then owned or existing or thereafter acquired or arising. All collateral granted or pledged by the Debtors pursuant to any Prepetition Senior Security Document or any other Prepetition Senior Loan Document, including, without limitation, the “Collateral” as defined in the Prepetition Senior Loan Agreement, and all pre-petition and post-petition proceeds thereof shall collectively be referred to herein as the “Prepetition Senior Collateral”. 4. (i) All Prepetition Senior Loan Documents executed and delivered by the Debtors to the Prepetition Senior Agent or any Prepetition Senior Lender are valid and enforceable by the Prepetition Senior Agent and the Prepetition Senior Lenders against each of the Debtors; (ii) the Prepetition Senior Liens constitute valid, binding, enforceable and perfected first priority liens and security interests in and on the Prepetition Senior Collateral, subject only to the Prior Liens (as defined below) and are not subject to avoidance, reduction, disallowance or subordination pursuant to the Bankruptcy Code or applicable non-bankruptcy law (except insofar as such liens are subordinated to the Postpetition Liens and the Carve-Out (each term as hereinafter defined) in accordance with the provisions of this Order); (iii) the Prepetition Senior Obligations constitute legal, valid and binding obligations of each of the Debtors, (iv) no offsets, defenses or counterclaims to the Prepetition Senior Obligations exist, (v) no portion of the Prepetition Senior Obligations, or any amounts previously paid to, or on behalf of, Prepetition Senior Agent or any Prepetition Senior Lender on account of or with respect the Prepetition Senior Obligations, are subject to avoidance, reduction, disgorgement, disallowance, impairment or subordination pursuant to the Bankruptcy Code or applicable non-bankruptcy law, and (vi) each Guaranty (as defined in the Prepetition Senior Loan Agreement) continues in full force and effect notwithstanding any use of Cash Collateral permitted hereunder or any financing and financial accommodations extended by the Postpetition Agent or Postpetition Lenders to the Debtors pursuant to the terms of this Order or Postpetition Loan Documents. 5. The Debtors have no valid claims (as such term is defined in section 101(5) of the Bankruptcy Code) or causes of action against the Prepetition Senior Agent or any Prepetition Senior Lender with respect to the Prepetition Senior Loan Agreement or any other Prepetition Senior Loan Documents, whether arising at law or at equity, including, without limitation, any re-characterization, subordination, avoidance or other debtor claims arising under or pursuant to sections 105, 510 or 542 through 553, inclusive, of the Bankruptcy Code. 6. As of the Petition Date, the Debtors were truly and justly indebted to the Prepetition Senior Agent and Prepetition Senior Lenders pursuant to the Prepetition Senior Loan -5WEIL:\96084664\2\15465.0003

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Documents, without defense, counterclaim or offset of any kind, in the aggregate principal amount of not less than $53.7 million in respect of loans made and letters of credit issued by the Prepetition Senior Agent and Prepetition Senior Lenders, plus all accrued and hereafter accruing and unpaid interest thereon and any additional fees and expenses (including any attorneys’, accountants’, appraisers’ and financial advisors’ fees and expenses that are chargeable or reimbursable under the Prepetition Senior Loan Documents) now or hereafter due under the Prepetition Senior Loan Agreement and the other Prepetition Senior Loan Documents. Prepetition Junior Agent and Prepetition Junior Lenders 7. Pursuant to that certain Amended and Restated Loan Agreement, dated as of July 12, 2016 (as amended, restated, supplemented or otherwise modified from time to time, the “Prepetition Junior Credit Agreement”), among each Borrower (with Holdings, Services CA, Services NY, and RIS as guarantors), and Cortland Capital Market Services LLC, as administrative agent and collateral agent for itself and the Prepetition Junior Lenders (as defined below) (in such capacity, the “Prepetition Junior Agent” and, together with the Prepetition Senior Agent, the “Prepetition Agents”), and the other lenders party thereto (collectively, the “Prepetition Junior Lenders” and, together with the Prepetition Senior Lenders, the “Prepetition Secured Lenders”), the Prepetition Junior Lenders agreed to extend term loans to the Debtors in an aggregate principal amount of $80,500,000. The Prepetition Junior Credit Agreement, along with any other agreements and documents executed or delivered in connection therewith, including, without limitation, the “Loan Documents” as defined therein, are collectively referred to herein as the “Prepetition Junior Loan Documents” (as the same may be amended, restated, supplemented or otherwise modified from time to time). 8. All obligations of the Debtors arising under the Prepetition Junior Credit Agreement (including, without limitation, the “Obligations” as defined therein) or any other Prepetition Junior Loan Document shall collectively be referred to herein as the “Prepetition Junior Obligations.” 9. Pursuant to the Security Documents (as defined in the Prepetition Junior Credit Agreement) (as such documents are amended, restated, supplemented or otherwise modified from time to time, the “Prepetition Junior Security Documents”), by and between each of the Debtors and the Prepetition Junior Agent, each Debtor granted to the Prepetition Junior Agent, for the benefit of itself and the Prepetition Junior Lenders, to secure the Prepetition Junior Obligations, a second priority security interest in and continuing lien (the “Prepetition Junior Liens”) in the Prepetition Senior Collateral. 10. (i) All Prepetition Junior Loan Documents executed and delivered by the Debtors to the Prepetition Junior Agent or any Prepetition Junior Lender are valid and enforceable by the Prepetition Junior Agent and the Prepetition Junior Lenders against each of the Debtors; (ii) the Prepetition Junior Liens constitute valid, binding, enforceable and perfected second priority liens and security interests in and on the Prepetition Senior Collateral, subject only to the Prior Liens (as defined below) and the Prepetition Senior Liens, and are not subject to avoidance, reduction, disallowance or subordination pursuant to the Bankruptcy Code or applicable non-bankruptcy law (except insofar as such liens are subordinated to the Postpetition -6WEIL:\96084664\2\15465.0003

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Liens and the Carve-Out (each term as hereinafter defined) in accordance with the provisions of this Order); (iii) the Prepetition Junior Obligations constitute legal, valid and binding obligations of each of the Debtors, (iv) no offsets, defenses or counterclaims to the Prepetition Junior Obligations exist, (v) no portion of the Prepetition Junior Obligations, or any amounts previously paid to Prepetition Junior Agent or any Prepetition Junior Lender on account of or with respect the Prepetition Junior Obligations, are subject to avoidance, reduction, disgorgement, disallowance, impairment or subordination pursuant to the Bankruptcy Code or applicable nonbankruptcy law, and (vi) each Guaranty (as defined in the Prepetition Junior Loan Agreement) continues in full force and effect notwithstanding any use of Cash Collateral permitted hereunder or any financing and financial accommodations extended by the Postpetition Agent or Postpetition Lenders to the Debtors pursuant to the terms of this Order or Postpetition Loan Documents. 11. The Debtors have no valid claims (as such term is defined in section 101(5) of the Bankruptcy Code) or causes of action against the Prepetition Junior Agent or any Prepetition Junior Lender with respect to the Prepetition Junior Loan Agreement or any other Prepetition Junior Loan Documents, whether arising at law or at equity, including, without limitation, any re-characterization, subordination, avoidance or other debtor claims arising under or pursuant to sections 105, 510 or 542 through 553, inclusive, of the Bankruptcy Code. 12. As of the Petition Date, the Debtors were truly and justly indebted to the Prepetition Junior Agent and Prepetition Junior Lenders pursuant to the Prepetition Junior Loan Documents, without defense, counterclaim or offset of any kind, in the aggregate principal amount of not less than $86.5 million in respect of loans made by the Prepetition Junior Agent and/or Prepetition Junior Lenders, plus all accrued and hereafter accruing and unpaid interest thereon and any additional fees and expenses (including any attorneys’, accountants’, appraisers’ and financial advisors’ fees and expenses that are chargeable or reimbursable under the Prepetition Junior Loan Documents) now or hereafter due under the Prepetition Junior Loan Agreement and the other Prepetition Junior Loan Documents. (b)

The Debtors irrevocably waive any right to challenge or contest the

Prepetition Senior Liens and/or the Prepetition Junior Liens and the validity of the Prepetition Senior Obligations and/or the Prepetition Junior Obligations; provided that, subject to paragraph 29 of this Order and the time limitations specified in paragraph 30 of this Order, none of the foregoing acknowledgments or agreements by the Debtors contained in this paragraph D shall be binding on any other party and shall not affect the rights of any committee, Person or entity (other than the Debtors with respect to the acknowledgements and agreements set forth in paragraph D) with respect to their rights to assert, pursue or otherwise allege any of the claims and actions described in paragraph 30 of this Order.

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As used herein, the term “Prior Liens” means only valid, enforceable, and

non-avoidable liens and security interests in the Prepetition Senior Collateral that were perfected prior to the Petition Date (or perfected on or after the Petition Date to the extent permitted by Section 546(b) of the Bankruptcy Code), which are not subject to avoidance, reduction, disallowance, impairment or subordination pursuant to the Bankruptcy Code or applicable nonbankruptcy law and which are senior in priority to the Prepetition Senior Liens under applicable law and after giving effect to any subordination or intercreditor agreements. For the avoidance of doubt, the Prior Liens shall not include, or be deemed to include, any or all of the Prepetition Senior Liens, Adequate Protection Senior Liens (as defined in paragraph 17(a) below), Prepetition Junior Liens and/or Adequate Protection Junior Liens (as defined in paragraph 18(a) below), all of which liens are being primed by the Postpetition Liens as set forth herein. E.

Cash Collateral. For purposes of this Order, the term “Cash Collateral”

shall mean and include all “cash collateral” as defined by section 363(a) of the Bankruptcy Code and shall include and consist of, without limitation, all of the respective cash proceeds of the Postpetition Collateral (as defined in paragraph 9 below) and Prepetition Senior Collateral in which any of the Prepetition Agents or Prepetition Secured Lenders has an interest (including, without limitation, any adequate protection lien or security interest), whether such interest existed as of the Petition Date or arises thereafter pursuant to this Order, any other order of this Court, applicable law or otherwise. F.

Exigent Circumstances. The Debtors have an immediate and critical need

to obtain post-petition financing under the Postpetition Facility and to use Cash Collateral in order to, among other things, finance the ordinary costs of their operations, maintain business relationships with vendors, suppliers and customers, make payroll, make capital expenditures, and satisfy other working capital and operational needs throughout the sale process.

The

Debtors’ access to sufficient working capital and liquidity through the incurrence of post-petition financing under the Postpetition Facility and the use of Cash Collateral under the terms of this -8WEIL:\96084664\2\15465.0003

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Order is vital to the preservation and maintenance of the going concern value of the Debtors’ estates throughout the sale process. Consequently, without access to the Postpetition Facility and the use of Cash Collateral, to the extent authorized pursuant to this Order, the Debtors and their estates would suffer immediate and irreparable harm. G.

No Alternative Sources of Funding. The use of Cash Collateral alone

would be insufficient to meet the Debtors’ post-petition liquidity needs. Given the Debtors’ current financial condition and capital structure, the Debtors have attempted but are unable to obtain (i) adequate unsecured credit allowable either (a) under sections 364(b) and 503(b)(1) of the Bankruptcy Code or (b) under section 364(c)(1) of the Bankruptcy Code, (ii) adequate credit secured by (x) a senior lien on unencumbered assets of their estates under section 364(c)(2) of the Bankruptcy Code and (y) a junior lien on encumbered assets under section 364(c)(3) of the Bankruptcy Code, or (iii) secured credit under section 364(d)(1) of the Bankruptcy Code, from sources other than the Postpetition Agent and the Postpetition Lenders on terms more favorable than the terms of the Postpetition Facility. The only source of secured credit available to the Debtors, other than the use of Cash Collateral, is the Postpetition Facility. The Debtors require both additional financing under the Postpetition Facility and the use of Cash Collateral under the terms of this Order for their post-petition liquidity needs.

After considering all of their

alternatives, the Debtors have concluded, in an exercise of their sound business judgment, that the financing to be provided by the Postpetition Agent and the Postpetition Lenders pursuant to the terms of this Order and the Postpetition Loan Documents represents the best financing presently available to the Debtors. H.

Willingness of Postpetition Lenders.

The Postpetition Agent and the

Postpetition Lenders have indicated a willingness to provide the Debtors with certain financing commitments, but solely on the terms and conditions set forth in this Order and in the Postpetition Loan Documents.

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Limited Consent. The consent of the Prepetition Senior Agent and the

Prepetition Senior Lenders to the priming of their liens by the Postpetition Liens is limited to the Postpetition Facility presently before this Court, with Wells Fargo as Postpetition Agent and a subset of the Prepetition Senior Lenders as Postpetition Lenders, and shall not, and shall not be deemed to, extend to any other post-petition financing or to any modified version of this Postpetition Facility with any party other than Wells Fargo as Postpetition Agent. Furthermore, the consent of the Prepetition Senior Agent and the Prepetition Senior Lenders to the Debtorsâ&#x20AC;&#x2122; use of Cash Collateral and the priming of their liens by the Postpetition Liens as provided in this Order does not constitute, and shall not be construed as constituting, an acknowledgment or stipulation by the Prepetition Senior Agent and the Prepetition Senior Lenders that their interests in the Prepetition Senior Collateral are adequately protected pursuant to this Order or otherwise. Nothing in this Order, including, without limitation, any of the provisions herein with respect to adequate protection, shall constitute, or be deemed to constitute, a finding that the interests of the Prepetition Agents or any Prepetition Secured Lender are or will be adequately protected with respect to any non-consensual use of Cash Collateral or non-consensual priming of the Prepetition Senior Liens or Prepetition Junior Liens. J.

Section 364(d) Finding. The security interests and liens granted pursuant

to this Order to the Postpetition Agent, for the benefit of itself and the Postpetition Lenders, are appropriate under section 364(d) of the Bankruptcy Code because, among other things: (i) such security interests and liens do not impair the interests of any holder of a valid, perfected, prepetition security interest or lien in any property of the Debtorsâ&#x20AC;&#x2122; estates, and/or (ii) the holders of such security interests and liens have consented (or are deemed to have consented) to the security interests and priming liens granted pursuant to this Order to the Postpetition Agent for the benefit of itself and the Postpetition Lenders. K.

Prepetition Intercreditor Agreement. Pursuant and subject to that certain

Intercreditor Agreement, dated as of August 20, 2013 (as amended, restated, supplemented or -10WEIL:\96084664\2\15465.0003

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otherwise modified from time to time, the “Prepetition Intercreditor Agreement”), by and between the Prepetition Senior Agent, on behalf of itself and the Prepetition Senior Lenders, and the Prepetition Junior Agent, on behalf of itself and the Prepetition Junior Lenders (and acknowledged by the Debtors), the Prepetition Junior Agent has agreed: (i) to subordinate its liens in the Prepetition Senior Collateral to the Postpetition Liens and the Carve-Out to the extent that the Prepetition Senior Liens are subordinated to the Postpetition Liens and the Carve-Out, and (ii) that it will not request adequate protection or any other relief in connection with the Debtors’ entry into the Postpetition Facility or their use of Cash Collateral, except to the extent permitted under Section 6 of the Prepetition Intercreditor Agreement. L.

Good Cause Shown. Good cause has been shown for immediate entry of

this Order pursuant to Bankruptcy Rules 4001(b)(2) and (c)(2) and such relief is in the best interest of the Debtors, their estates and creditors. In particular, the authorizations granted herein for the Debtors to execute the Postpetition Loan Documents, to use the Cash Collateral, and to obtain interim financing, including on a priming lien basis, are necessary to avoid immediate and irreparable harm to the Debtors and their estates, are fair and reasonable, reflect the Debtors’ exercise of prudent business judgment consistent with their fiduciary duties, and are supported by reasonably equivalent value and fair consideration. M.

Section 364(e); Good Faith. The Postpetition Facility, Postpetition Loan

Documents, use of Cash Collateral and provision of adequate protection contained herein have been negotiated in good faith and at arm’s-length among the Debtors, the Prepetition Senior Agent and Postpetition Agent. Accordingly, any credit extended and loans made to, Cash Collateral used by, and adequate protection provided by the Debtors pursuant to this Order shall be, and hereby are, deemed to have been extended, issued, made, used or provided, as the case may be, in “good faith” as required by, and within the meaning of, section 364(e) of the Bankruptcy Code.

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Based upon the foregoing findings, stipulations, and conclusions, and upon the record made before this Court at the Interim Hearing, and good and sufficient cause appearing therefor, IT IS HEREBY ORDERED, ADJUDGED AND DECREED THAT: 1.

Motion Granted. The Motion is approved on an interim basis on the terms

and conditions set forth in this Order. This Order shall become effective immediately upon its entry. To the extent any provisions in this Order conflict with any provisions of the Postpetition Loan Documents, the provisions of this Order shall control and govern to the extent of such conflict. All objections to the entry of this Order have been withdrawn or overruled. 2.

Postpetition Loan Documents.

The terms and conditions of the

Postpetition Loan Agreement are hereby approved. The Debtors are hereby authorized to enter into and deliver the Postpetition Loan Agreement and such additional documents, instruments, notes and agreements as may be reasonably required by the Postpetition Agent to implement the terms or effectuate the purposes of this Order (as such additional documents, instruments, notes and agreements may be amended, restated, supplemented or otherwise modified from time to time in accordance with their terms, together with the Postpetition Loan Agreement, the â&#x20AC;&#x153;Postpetition Loan Documentsâ&#x20AC;?). Each Borrower is hereby authorized to borrow money and obtain letters of credit under the Postpetition Loan Agreement, in accordance with the terms of this Order and the Postpetition Loan Documents. Upon execution and delivery thereof by any Borrower or any other applicable Debtor, the Postpetition Loan Documents shall be incorporated by reference as part of this Order and shall constitute valid and binding obligations of the Debtors, enforceable against each Debtor party thereto (and its respective estate, successor and assigns) in accordance with the terms thereof. The Postpetition Agent may from time to time impose reserves against Borrowing Availability as Postpetition Agent deems necessary or appropriate in accordance with the Postpetition Loan Agreement (or, if not specified therein, in the Permitted Discretion (as defined in the Postpetition Loan Agreement) of the Postpetition -12WEIL:\96084664\2\15465.0003

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Agent), including, without limitation, a reserve for the Carve-Out (as defined in paragraph 13 below). 3.

Amendments. The Debtors are hereby authorized, without further notice,

motion or application to, order of, or hearing before, this Court, to enter into agreements with the Postpetition Agent providing for any non-material modifications to the Approved Budget (as defined in paragraph 8 below) or the Postpetition Loan Agreement, or of any other modifications to the Postpetition Loan Agreement necessary to conform the Postpetition Loan Agreement to this Order; provided, however, that notice of any material modification or amendment to the Approved Budget or the Postpetition Loan Agreement shall be provided to counsel to the Creditors’ Committee (if one is appointed) and counsel to the U.S. Trustee, each of whom shall have three (3) days from the date of such notice within which to object in writing to such modification or amendment. If the Creditors’ Committee or the U.S. Trustee timely objects in writing served on counsel for the Agent and the Debtors to any material modification or amendment to the Approved Budget or the Postpetition Loan Agreement, then such modification or amendment shall only be permitted pursuant to an order of this Court. 4.

Permitted Use. a.

Generally. Notwithstanding anything in this Order to the contrary,

the Debtors may use the Cash Collateral and proceeds of the Postpetition Facility, obtain and maintain Letters of Credit and pay Postpetition Obligations solely in accordance with and pursuant to the financial covenants, availability formulae, and other terms and conditions set forth in the Postpetition Loan Documents and this Order, including, without limitation, pursuant to the Approved Budget, but in all events only until the earliest of (i) July 2, 2017, (ii) the closing of a sale of substantially all of the Debtors’ assets pursuant to an Approved Sale Motion (as defined in the Postpetition Loan Agreement) and indefeasible payment in full of all Postpetition Obligations and Prepetition Senior Obligations, (iii) the closing of any refinancing of the Prepetition Senior Obligations and Postpetition Obligations, (iv) the effective date of a plan of -13WEIL:\96084664\2\15465.0003

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reorganization in the Chapter 11 Cases, (v) the conversion or dismissal of any of the Chapter 11 Cases, (vi) the appointment of a trustee or examiner in any of the Chapter 11 Cases, and (vii) at the option of the Postpetition Agent in its sole discretion, the occurrence of any Event of Default under this Order and/or the Postpetition Loan Agreement (the date of the earliest such occurrence, the “Commitment Termination Date”).

Notwithstanding the foregoing, but

subject to the Maximum Amount (as defined in paragraph 7 below), if the Postpetition Agent or the Postpetition Lenders in their respective sole discretion advance funds or provide other extensions of credit to the Debtors in excess of any financial covenants, availability formulae, or other terms and conditions (or any other limitations in the Postpetition Loan Documents, including, without limitation, the Approved Budget), such advances (and any other indebtedness in excess of such amount) shall constitute Postpetition Obligations entitled to the rights, priorities, benefits and protections of the Postpetition Loan Documents and this Order. b.

No Duty to Monitor Compliance. The Postpetition Agent, the

Prepetition Agents, the Postpetition Lenders and the Prepetition Secured Lenders may assume the Debtors will comply with this Order, the Approved Budget and the Postpetition Loan Documents and shall not (i) have any obligation with respect to the Debtors’ use of Cash Collateral or the use of proceeds of the Postpetition Facility; (ii) be obligated to ensure or monitor the Debtors’ compliance with any financial covenants, formulae, or other terms and conditions of any Postpetition Loan Document or (iii) be obligated to pay (directly or indirectly from the Prepetition Senior Collateral or Postpetition Collateral) any expenses incurred or authorized to be incurred pursuant to the Postpetition Loan Documents. 5.

Postpetition Obligations.

For purposes of this Order, the term

“Postpetition Obligations” shall mean all amounts owing under the Postpetition Loan Agreement and other Postpetition Loan Documents (including, without limitation, all “Obligations” as defined in the Postpetition Loan Agreement) and shall include the principal of, interest on, fees, costs, expenses and other charges owing in respect of, such amounts (including, -14WEIL:\96084664\2\15465.0003

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without limitation, any reasonable attorneys’, accountants’, financial advisors’ and other fees, costs and expenses that are chargeable or reimbursable under the Postpetition Loan Documents), and any obligations in respect of letters of credit or indemnity claims, in each case whether contingent or otherwise. 6.

Interest, Fees, Costs and Expenses. The Postpetition Obligations shall

bear interest at the rates, and be due and payable (and paid), as set forth in, and in accordance with the terms and conditions of, this Order and the Postpetition Loan Documents, in each case without further notice, motion or application to, order of, or hearing before, this Court. The Debtors shall pay on demand all fees, costs, expenses and other charges payable under the terms of the Postpetition Loan Documents, including, without limitation, all fees, costs and expenses described in the Postpetition Loan Agreement, in each case whether or not the Postpetition Loan Agreement and transactions contemplated therein are consummated. None of such fees, costs and expenses shall be subject to Court approval or U.S. Trustee guidelines, and no recipient of any such payment shall be required to file with respect thereto any interim or final fee application with this Court; provided, that the Postpetition Agent shall submit invoices for its professional services to the Debtors, the U.S. Trustee, and counsel for the Creditors’ Committee (if one is appointed). Such invoices may be redacted to the extent necessary to delete any information subject to the attorney-client privilege, any information constituting attorney work product, or any other confidential information, and the provision of such invoices shall not constitute any waiver of the attorney-client privilege or of any benefits of the attorney work product doctrine. The Debtors, the U.S. Trustee, and the Creditors’ Committee may object to the reasonableness of the fees, costs and expenses included in any professional fee invoice submitted by the Postpetition Agent; provided that, any such objection shall be forever waived and barred unless (i) it is filed with this Court and served on counsel to the Postpetition Agent no later than 14 days after the objecting party’s receipt of the applicable professional fee invoice, and (ii) it describes with particularity the items or categories of fees, costs and expenses that are the subject -15WEIL:\96084664\2\15465.0003

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of the objection and provides the specific basis for the objection to each such item or category of fees, costs and expenses. Any hearing on an objection to payment of any fees, costs and expenses of the Postpetition Agent set forth in a professional fee invoice shall be limited to the reasonableness or necessity of the particular items of categories of the fees, costs and expenses which are the subject of such objection. The Debtors shall indemnify the Postpetition Agent and the Postpetition Lenders (and other applicable parties) to the extent set forth in the Postpetition Loan Documents, including, without limitation, as provided in Section 3.4 the Postpetition Loan Agreement. All such unpaid fees, costs, expenses, and charges that have not been disallowed by this Court on the basis of an objection filed in accordance with this Order hereof shall constitute Postpetition Obligations and shall be secured by the Postpetition Collateral as specified in this Order. Any and all fees, commissions, costs and expenses paid prior to the Petition Date by any Debtor to the Postpetition Agent or Postpetition Lenders in connection with or with respect to the Postpetition Facility, Postpetition Loan Agreement or other Postpetition Loan Documents are hereby approved in full. 7.

Maximum Amount. Subject to the terms and conditions set forth in this

Order and in the Postpetition Loan Documents, the Debtors may use the proceeds of the Postpetition Facility and the Cash Collateral solely to: (i) pay outstanding Postpetition Obligations as provided in the Postpetition Loan Documents and this Order, (ii) make the adequate protection payments required under this Order, and (iii) fund general corporate and working capital requirements of the Debtors constituting administrative expenses in the Chapter 11 Cases, in each case in accordance with the Approved Budget and the terms of the Postpetition Loan Documents. The aggregate principal amount of Revolving Loans available under the Postpetition Loan Agreement shall not at any time exceed $65,000,000 (less the outstanding Net Prepetition Senior Obligations (as defined in the Postpetition Loan Agreement)) without further order of this Court (the â&#x20AC;&#x153;Maximum Amountâ&#x20AC;?), provided, however, that from and after the entry

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of this Order and prior to the entry of the Final Order, the maximum aggregate amount of Revolving Loans and Letters of Credit shall be limited to $37,625,000. 8.

Approved Budget. a.

Generally. Attached hereto as Exhibit A is a 13-week budget (the

“Initial Approved Budget”) which reflects on a line-item basis the Debtors’ anticipated cumulative cash receipts and expenditures on a weekly basis and all necessary and required cumulative expenses which the Debtors expect to incur during each week of the Initial Approved Budget. The Initial Approved Budget may be modified or supplemented from time to time by additional budgets (covering any time period covered by a prior budget or covering additional time periods) prepared by Debtors and approved by the Postpetition Agent in writing (each such additional budget, a “Supplemental Approved Budget”), in each case without further notice, motion or application to, order of, or hearing before, this Court (except as required by paragraph 3 above). The aggregate, without duplication, of all items in the Initial Approved Budget and any Supplemental Approved Budgets shall constitute an “Approved Budget.” b.

Budget Covenants. On a weekly basis for the period from the

Petition Date through the last day of the week of determination, actual receipts of and disbursements by the Debtors shall comply with Section 10.3 of the Postpetition Loan Agreement. The Debtors shall provide to the Postpetition Agent, so as actually to be received on the second Business Day of each week, line-by-line certified variance reports for the preceding weekly period and on a cumulative basis from the Petition Date to the report date, comparing actual cash receipts and disbursements to amounts projected in the Approved Budget, in form and scope reasonably acceptable to the Postpetition Agent. The Debtors shall, on Friday of each week from the Closing Date until the Commitment Termination Date, deliver to the Postpetition Agent an updated, “rolling” 13-week budget which sets forth by line item updated projected receipts and disbursements for the Debtors during the period commencing from the end of the previous week through and including thirteen weeks thereafter; provided that the Debtors shall -17WEIL:\96084664\2\15465.0003

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still be subject to and be governed by the terms of the Approved Budget then in effect and the Postpetition Agent, Prepetition Senior Agent, Postpetition Lenders and Prepetition Senior Lenders shall, as applicable, have no obligation to fund to such updated “rolling budget” or permit the use of Cash Collateral with respect thereto. The Debtors shall, by no later than five (5) Business Days prior to the end of the period covered by the then applicable Approved Budget, deliver to the Postpetition Agent a Supplemental Approved Budget.

The Debtors

acknowledge and agree that (i) the incurrence or payment by the Debtors of expenses (x) other than the itemized amounts set forth in the Approved Budget or (y) in excess of the variances permitted by Section 10.3 of the Postpetition Loan Agreement, or (ii) other violation of the terms and condition of this sub-paragraph (b) (each a “Budget Default”), shall constitute an Event of Default (as defined in Section 12 of the Postpetition Loan Agreement). 9.

Postpetition Liens. As security for the full and timely payment of the

Postpetition Obligations, the Postpetition Agent, for the benefit of the Postpetition Agent and the Postpetition Lenders, is hereby granted, pursuant to sections 364(c)(2), 364(c)(3) and 364(d)(1) of the Bankruptcy Code, valid, binding, enforceable, unavoidable and fully perfected security interests, liens and mortgages (collectively, the “Postpetition Liens”) in and upon all prepetition and post-petition real and personal, tangible and intangible property and assets of each of the Debtors of any kind or nature whatsoever, wherever located, whether now existing or hereafter acquired or arising, including, without limitation, all cash (including all Cash Collateral wherever held), cash equivalents, bank accounts, accounts, other receivables, chattel paper, contract rights, inventory, instruments, documents, securities (whether or not marketable), equipment, goods, fixtures, real property interests, intellectual property, general intangibles, investment property, supporting obligations, letter of credit rights, commercial tort claims, one hundred percent (100%) of the capital stock of each Debtor’s direct and indirect subsidiaries, all inter-company notes held by the Debtors, copyrights, trademarks, trade names, licenses, rights to payment including tax refund claims, and causes of action (exclusive of actions for preferences, -18WEIL:\96084664\2\15465.0003

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fraudulent conveyances, and other avoidance power claims under sections 544, 545, 547, 548, 549 and 550 of the Bankruptcy Code (the “Avoidance Actions”), but, only after entry of the Final Order, inclusive of the proceeds and recoveries from the Avoidance Actions (the “Avoidance Action Proceeds”)), and the Prepetition Senior Collateral, and the proceeds, products, offspring, rents and profits of all of the foregoing, including insurance proceeds (all of the foregoing, the “Postpetition Collateral”). Such Postpetition Liens shall not be released except to the extent that the liens securing the Postpetition Obligations and Prepetition Senior Obligations (in their respective priority) are transferred to the proceeds of a sale of substantially all of the Borrowers’ assets under section 363 of the Bankruptcy Code, such proceeds are an amount sufficient to pay or Cash Collateralize (as defined in the Prepetition Senior Loan Agreement) (as applicable) the Postpetition Obligations and Prepetition Senior Obligations in full, and such proceeds are applied to permanently and indefeasibly repay the Postpetition Obligations and Prepetition Senior Obligations, in full, in cash; provided, that such Postpetition Liens on any such proceeds and any assets that were not sold as part of such sale shall not be released until the expiration of the Complaint Filing Deadline (or resolution of any complaint or adversary proceeding described in paragraph 30 of this Order). 10.

Other Priority Matters. Subject to the Carve-Out, the Postpetition Liens:

(a) shall, pursuant to section 364(c)(2) of the Bankruptcy Code, constitute first priority security interests in and liens on all Postpetition Collateral that is not otherwise subject to any Prior Lien; (b) shall, pursuant to section 364(d)(1) of the Bankruptcy Code, be senior to and prime (i) the Prepetition Senior Liens and any Prepetition Junior Liens, and (ii) the Adequate Protection Senior Liens and Adequate Protection Junior Liens (the liens described in clauses (i) and (ii) above, collectively, the “Primed Liens”); and (c) shall, pursuant to section 364(c)(3) of the Bankruptcy Code, be immediately junior in priority to any and all Prior Liens (other than the Primed Liens) on or in the Postpetition Collateral. Other than the Carve-Out and Prior Liens, the Postpetition Liens shall at all times be senior to the following (collectively, the “Subordinate -19WEIL:\96084664\2\15465.0003

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Liens and Related Rights”): (i) the rights of any Debtor and any successor trustee or estate representative in the Chapter 11 Cases or any other subsequent proceedings under the Bankruptcy Code, including, without limitation, any chapter 7 proceeding if any of the Chapter 11 Cases are converted to a case under chapter 7 of the Bankruptcy Code (collectively, the “Successor Case”); (ii) any inter-company claim of any Debtor or any subsidiary or affiliate of any Debtor, and (iii) any security interest or lien which is either (x) avoided or otherwise preserved for the benefit of any Debtor’s estate under section 551 or any other provision of the Bankruptcy Code, or (y) junior or otherwise subordinate to the Prepetition Senior Liens. The Postpetition Liens shall be deemed legal, valid, binding, enforceable, and perfected liens, not subject to subordination, impairment or avoidance, for all purposes in the Chapter 11 Cases and any Successor Case. Other than the Carve-Out and Prior Liens, no other liens or security interests, whether for adequate protection or otherwise, shall be senior or equal to or pari passu with the Postpetition Liens in these Chapter 11 Cases or any Successor Case without the express written consent of the Postpetition Agent given in accordance with the Postpetition Loan Agreement (which consent may be withheld in its sole discretion). Notwithstanding anything herein to the contrary, all parties retain and reserve all their rights to dispute the validity, priority, enforceability and perfection of the Prior Liens. 11.

Super-Priority Claim.

In addition to the Postpetition Liens, the

Postpetition Agent and Postpetition Lenders are hereby granted, for all Postpetition Obligations, an allowed super-priority administrative expense claim pursuant to Section 364(c)(1) of the Bankruptcy Code (the “Super-Priority Claim”) against each Debtor and its respective estate. Except for the Carve-Out, the Super-Priority Claim shall have priority over all other costs and expenses of administration of any kind (and no cost or expense of administration shall be senior to, equal to, or pari passu with, the Super-Priority Claim), including those specified in, or ordered pursuant to, sections 105, 326, 328, 330, 331, 363, 364, 503, 506, 507, 546, 726, 1113 or 1114 or any other provision of the Bankruptcy Code or otherwise (whether incurred in these Chapter 11 -20WEIL:\96084664\2\15465.0003

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Cases or any Successor Case, whether for adequate protection, the lack of, or failure to provide, adequate protection, or otherwise, including, without limitation, the Adequate Protection Senior Claims and Adequate Protection Junior Claims). The Super-Priority Claim shall at all times be senior to the following (collectively, the â&#x20AC;&#x153;Subordinate Claims and Related Rightsâ&#x20AC;?): (i) the rights of any Debtor or any subsidiary or affiliate of any Debtor, (ii) any successor trustee or estate representative in the Chapter 11 Cases or any Successor Case, or (iii) except for the CarveOut, any other creditor or party in interest in the Chapter 11 Cases or any Successor Case. Only after entry of the Final Order, the Super-Priority Claim, the Adequate Protection Senior Claim (as defined below) and the Adequate Protection Junior Claim (as defined below) shall be payable from, and have recourse to, the Avoidance Actions and Avoidance Action Proceeds. 12.

No Reduction or Impairment. No obligation or liability owed, or payment,

transfer or grant of security, to Postpetition Agent or any Postpetition Lender under this Order or any other Postpetition Loan Document shall be stayed, restrained, voidable, impaired, or recoverable under the Bankruptcy Code or under any applicable law (including, without limitation, under section 502(d) or 548 of the Bankruptcy Code or under any applicable state Uniform Fraudulent Transfer Act, Uniform Fraudulent Conveyance Act or similar statute or common law), or be subject to any defense, reduction, setoff, recoupment or counterclaim, whether in the Chapter 11 Cases or any Successor Case. Subject to paragraph 30 below, the release of claims by the Debtors against the Postpetition Agent and the Postpetition Lenders (and other applicable parties) set forth in Section 1.5 of the Postpetition Loan Agreement is hereby approved. The Postpetition Obligations, once paid by any Debtor, shall be non-refundable. 13.

Carve-Out. a.

Generally. Notwithstanding anything to the contrary contained in

this Order, the liens and claims granted to any of the Postpetition Agent, Postpetition Lenders, Prepetition Agents, or Prepetition Secured Lenders in this Order, the Postpetition Loan Documents, the Prepetition Senior Loan Documents and/or any Prepetition Junior Loan -21WEIL:\96084664\2\15465.0003

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Documents shall be subject to the payment, without duplication, of the following fees and claims (collectively, the “Carve-Out”), but only to the extent that there are not sufficient, unencumbered funds in the Debtors’ estates to pay such amounts at the time payment is required to be made: (i) all fees required to be paid to the Clerk of the Court and to the Office of the United States Trustee under section 1930(a) of title 28 of the United States Code plus interest at the statutory rate (without regard to the notice set forth in (iii) below); (ii) all reasonable fees and expenses up to $50,000 incurred by a trustee under section 726(b) of the Bankruptcy Code (without regard to the notice set forth in (iii) below); (iii) to the extent allowed at any time, whether by interim order, procedural order, or otherwise, all unpaid fees and expenses (the “Allowed Professional Fees”) that are not excluded from the Carve-Out pursuant to paragraph 29 of this Order, and incurred by persons or firms retained by the Debtors pursuant to section 327, 328, or 363 of the Bankruptcy Code (the “Debtor Professionals”) and professionals of any statutory committees appointed in the Chapter 11 Cases whose retention is approved by this Court during the Chapter 11 Cases pursuant to section 328 or 1103 of the Bankruptcy Code (the “Committee Professionals” and, together with the Debtor Professionals, the “Retained Professionals”) at any time before or on the first day following delivery by the Postpetition Agent of a Carve Out Trigger Notice (as defined below), whether allowed by this Court prior to or after delivery of a Carve Out Trigger Notice; and (iv) Allowed Professional Fees of Retained Professionals that are not excluded from the Carve-Out pursuant to paragraph 29 of this Order in an aggregate amount not to exceed $250,000 incurred after the first day following delivery by the Postpetition Agent of the Carve Out Trigger Notice, to the extent allowed at any time, whether by interim order, procedural order, or otherwise (the amounts set forth in this clause (iv) being the “PostCarve Out Trigger Notice Cap”). b.

Carve-Out Trigger Date. For purposes of the foregoing, “Carve

Out Trigger Notice” shall mean a written notice delivered by email (or other electronic means) by the Postpetition Agent to the Debtors, their counsel, the U.S. Trustee, and counsel to the Creditors’ Committee (if any), which notice may be delivered only on or after (i) the occurrence and continuation of an Event of Default under the Postpetition Loan Agreement or the Commitment Termination Date and (ii) the termination of the Postpetition Agent’s or -22WEIL:\96084664\2\15465.0003

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Postpetition Lendersâ&#x20AC;&#x2122; obligations to make loans or provide other extensions of credit under the Postpetition Loan Agreement. c.

Reservation of Rights. Payment of any fees and expenses of the

Retained Professionals pursuant to the Carve-Out shall not, and shall not be deemed to, (i) reduce any Debtorâ&#x20AC;&#x2122;s obligations owed to any of the Postpetition Agent, Postpetition Lenders, Prepetition Agents, and/or Prepetition Secured Lenders, or (ii) subordinate, modify, alter or otherwise affect any of the liens and security interests of such parties in the Postpetition Collateral or Prepetition Senior Collateral (or their respective claims against the Debtors). The Postpetition Agent, Postpetition Lenders, Prepetition Agents, and Prepetition Secured Lenders shall not be responsible for the direct payment or reimbursement of any fees or disbursements of any Retained Professionals (or of any other Person) incurred in connection with the Chapter 11 Cases or any Successor Case, and nothing in this Order or otherwise shall be construed to obligate such parties in any way to pay compensation to or to reimburse expenses of any Retained Professional or any other Person, or to ensure that any Debtor has sufficient funds to pay such compensation or reimbursement. Nothing herein shall impair, or be construed to impair, the ability of any party to object to any of the fees, expenses, reimbursement or compensation of the Retained Professionals. 14.

Cash Collection Procedures. a.

Generally. From and after the date of the entry of this Order, all

collections and proceeds of any Postpetition Collateral or Prepetition Senior Collateral or services provided by any Debtor and all Cash Collateral which shall at any time come into the possession, custody or control of any Debtor, or to which any Debtor is now or shall become entitled at any time, shall be promptly deposited in the same bank accounts into which the collections and proceeds of the Prepetition Senior Collateral were deposited under the Prepetition Senior Loan Agreement (or in such other accounts as are designated by Postpetition Agent from time to time), and such collections and proceeds upon such deposit shall be applied, subject to -23WEIL:\96084664\2\15465.0003

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the Carve-Out and any Prior Liens, against the Postpetition Obligations and Prepetition Senior Obligations as provided in the Postpetition Loan Documents and this Order. The Debtors shall promptly enter into any additional agreements providing for the establishment of lock boxes, blocked accounts, or similar arrangements in favor of the Postpetition Agent for purposes of facilitating cash collections from the Debtors in accordance with the terms of the Postpetition Loan Agreement and this Order. b.

Existing Accounts. The Prepetition Agents and the Prepetition

Secured Lenders shall immediately share dominion and control with the Postpetition Agent with respect to each depository account of the Debtors or other third party that was subject to a deposit account control agreement or similar agreement with or in favor of any of the Prepetition Agents or the Prepetition Secured Lenders as of the Petition Date, and such agreements shall hereafter be additionally enforceable by the Postpetition Agent against, and binding upon, each depository institution party thereto until the Postpetition Obligations have been paid in full in cash and the Postpetition Loan Agreement shall have been terminated, after which such agreements shall again be solely enforceable by the Prepetition Agents and the Prepetition Secured Lenders, as applicable. c.

Cash Collateral Account; Application of Cash Collateral.

All

funds received by Prepetition Senior Agent or Postpetition Senior Agent to Cash Collateralize any of the Letters of Credit issued under (and as defined in) the Prepetition Senior Loan Agreement (each such Letter of Credit, a “Prepetition Senior Letter of Credit”; such funds, “Prepetition Senior LC Cash Collateral”), shall be deposited into a bank account in the name of Prepetition Senior Agent and maintained by Wells Fargo (the “Prepetition Senior LC Cash Collateral Account”). Following the expiration or termination of any Prepetition Senior Letter of Credit and the payment and satisfaction of all LC Obligations (as defined in the Prepetition Senior Loan Agreement) with respect to such Prepetition Senior Letter of Credit, the portion (if any) of Prepetition Senior LC Cash Collateral then held in the Prepetition Senior LC Cash -24WEIL:\96084664\2\15465.0003

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Collateral Account based on such expired or terminated Prepetition Senior Letter of Credit (the amount of such portion to be determined in accordance with the definition of Cash Collateralize set forth in the Prepetition Senior Loan Agreement) shall be applied by Postpetition Agent in accordance with the terms of the Postpetition Loan Agreement and this Order. 15.

Non-Ordinary Course Dispositions. a.

The Debtors shall comply in all respects with the sale process

covenants and deadlines set forth the Postpetition Loan Agreement, for which time is of the essence, including, without limitation, the following: (i) On or before seven days after the Petition Date, Borrowers must file a motion to approve sale and bidding procedures with this Court to sell substantially all of Borrowers’ assets together with a committed asset purchase agreement, in form and substance acceptable to Postpetition Agent and Postpetition Lenders (any such motion, a “Sale Motion”), to purchase substantially all of the assets of Borrowers from a purchaser satisfactory to Postpetition Agent and Postpetition Lenders (such purchaser, the “Stalking Horse Bidder”; such committed asset purchase agreement, the “Stalking Horse Bid”) in an amount at least sufficient to fully repay all obligations owed to Postpetition Agent, Postpetition Lenders, Prepetition Senior Agent, and Prepetition Senior Lenders, including, without limitation, all Prepetition Senior Obligations and all Postpetition Obligations, in cash at closing, signed by the purchaser and Borrowers, with no material conditions to close, except for an order of the Bankruptcy Court approving the sale and a financing contingency and a contingency related to the Borrowers’ collective bargaining agreements, in each case, acceptable to Agent and Lenders. (ii) Borrowers shall have obtained this Court’s approval of the Stalking Horse Bid and the bidding procedures set forth in the Sale Motion no later than 25 days after the Petition Date, and such Stalking Horse Bid must provide for payment in full of Borrowers’ obligations owed to Agent, Lenders, Prepetition Senior Agent and Prepetition Senior Secured Parties, including, without limitation, all Prepetition Senior Obligations and all Obligations. (iii) The final auction of the assets covered by the Stalking Horse Bid must be held no later than 70 days after the Petition Date. (iv) The contingencies to the Stalking Horse Bid set forth in Section 10.1(e) and (f) shall each have been waived by the Stalking Horse Bidder or otherwise satisfied on or before the date of the final hearing on the Sale Motion. (v) This Court must grant Borrowers’ Sale Motion no later than 75 days after the Petition Date, and the closing and funding of the sale described therein (including the receipt by Agent, Lenders, Prepetition Senior Agent and Prepetition Senior Lenders of full payment of Borrowers’ obligations owed to Postpetition Agent, Postpetition -25WEIL:\96084664\2\15465.0003

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Lenders, Prepetition Senior Agent and Prepetition Senior Lenders, including, without limitation, all Prepetition Senior Obligations and all Postpetition Obligations) must occur no later than 85 days after the Petition Date. b.

Subject to the terms and conditions of the Prepetition Intercreditor

Agreement, the respective rights of the Postpetition Agent, Postpetition Lenders, Prepetition Senior Agent, and Prepetition Senior Lenders to credit bid all or any portion of the Postpetition Obligations and Prepetition Senior Obligations (as applicable) and the respective rights of the Prepetition Junior Agent and Prepetition Junior Lenders to credit bid all or any portion of the Prepetition Junior Obligations, in each case, under section 363(k) of the Bankruptcy Code and other applicable law in connection with any proposed sale of Prepetition Senior Collateral or Postpetition Collateral (other than the sale of Inventory in the ordinary course of any Debtorâ&#x20AC;&#x2122;s business), or to object to such proposed sale or other Asset Disposition, shall be preserved through the closing of such sale or other Asset Disposition. Any and all proceeds arising from or in connection with any sale or lease of Postpetition Collateral or Prepetition Senior Collateral, or other Asset Disposition, including proceeds arising from or in connection with any Asset Disposition described in the Postpetition Loan Agreement, shall, subject to the terms of the Postpetition Loan Documents, be immediately transferred to Postpetition Agent or Prepetition Senior Agent (as applicable) for application to, or cash collateralization of, the Postpetition Obligations or Prepetition Senior Obligations in accordance with the terms and conditions of the Postpetition Loan Documents and Prepetition Senior Loan Documents (in each case, as applicable). 16.

Landlord Agreements.

Upon entry of the Final Order, all landlord

agreements to which either Prepetition Agent is a party shall be deemed amended to include the Postpetition Agent as a beneficiary thereunder, and such agreements shall thereafter be additionally enforceable by the Postpetition Agent against, and binding upon, each landlord party -26WEIL:\96084664\2\15465.0003

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thereto in accordance with, and subject to, its respective terms and conditions until the Postpetition Obligations shall have been paid in full in cash and the Postpetition Loan Agreement shall have been terminated, after which such agreements shall again be solely enforceable by the applicable Prepetition Agent. 17.

Adequate Protection Senior Obligations. Until the indefeasible repayment

in full in cash of the Prepetition Senior Obligations and the expiration of the Complaint Filing Deadline (or resolution of any complaint or adversary proceeding described in paragraph 30 of this Order), as adequate protection for the Prepetition Senior Agent’s interest in the Prepetition Senior Collateral, the Prepetition Senior Agent and Prepetition Senior Lenders are hereby granted the following: a.

Replacement Liens. Pursuant to sections 361(2), 362, 363(c)(2),

and 363(e) of the Bankruptcy Code, the Prepetition Senior Agent, for its benefit and the benefit of the Prepetition Senior Lenders, is hereby granted by each Debtor continuing valid, binding, enforceable and perfected, liens and security interests in and on all of the Postpetition Collateral (the “Adequate Protection Senior Liens”). The Adequate Protection Senior Liens shall (i) be subordinate only to: (A) the Carve-Out, (B) the Postpetition Liens, and (C) the Prior Liens; and (ii) be senior and superior to the Subordinate Liens and Related Rights and, pursuant to the Prepetition Intercreditor Agreement, the Prepetition Junior Liens. The Adequate Protection Senior Liens shall be deemed legal, valid, binding, enforceable, and perfected liens, not subject to subordination, impairment or avoidance, for all purposes in the Chapter 11 Cases and any Successor Case. Except as described in clause (i) above, no other liens or security interests, whether for adequate protection or otherwise, shall be senior or equal to or pari passu with the Adequate Protection Senior Liens in these Chapter 11 Cases or any Successor Case without the prior written consent of the Prepetition Senior Agent given in accordance with the Prepetition Senior Loan Agreement (which consent may be withheld in its sole discretion).

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Adequate Protection Senior Claim. Pursuant to section 507(b) of

the Bankruptcy Code, the Prepetition Senior Agent and the Prepetition Senior Lenders shall have an allowed super-priority administrative expense claim (the “Adequate Protection Senior Claim”) against each Debtor and its respective estate. The Adequate Protection Senior Claim shall: (i) be subordinate only to: (A) the Carve-Out, and (B) the Super-Priority Claim; and (ii) be senior and superior to the Subordinate Claims and Related Rights. Except as described in clause (i) above, no cost or expense of administration under any provision of the Bankruptcy Code (whether incurred in these Chapter 11 Cases or any Successor Case, whether for adequate protection, the lack of, or failure to provide, adequate protection, or otherwise), shall be senior to, equal to, or pari passu with, the Adequate Protection Senior Claim. c.

Adequate Protection Payments. As further adequate protection,

subject to the rights set forth in paragraph 30 hereof, and without limiting any rights of the Prepetition Senior Agent and the Prepetition Senior Lenders under section 506(b) of the Bankruptcy Code which are hereby preserved, and in consideration, and as a requirement, for obtaining the consent of the Prepetition Senior Agent and Prepetition Senior Lenders to the entry of this Order and the Debtors’ consensual use of Cash Collateral as provided herein, (i) the proceeds of any Prepetition Senior Collateral and any Postpetition Collateral shall be paid to Prepetition Senior Agent and Prepetition Senior Lenders for application to the Prepetition Senior Obligations until such Prepetition Senior Obligations are paid in full or Cash Collateralized (as defined in the Prepetition Senior Loan Agreement), (ii) Debtors shall make all payments of interest as and when due under the Prepetition Senior Loan Agreement, and (iii) the Debtors shall, on the Closing Date and on a monthly basis thereafter, pay or reimburse the Prepetition Senior Agent and Prepetition Senior Lenders for any and all of its accrued and past-due fees, costs, expenses and charges payable under the Prepetition Senior Loan Documents, including without limitation, the reasonable attorneys’ and other fees and expenses of the Prepetition Senior Agent and Prepetition Senior Lenders as provided in the Prepetition Senior Loan -28WEIL:\96084664\2\15465.0003

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Agreement, whether accrued prepetition or postpetition, all without further notice, motion or application to, order of, or hearing before, this Court. d.

Adequate Protection Senior Obligations. The Adequate Protection

Senior Liens and Adequate Protection Senior Claim shall secure the payment of the Prepetition Senior Obligations in an amount equal to any diminution in the value of the Prepetition Senior Agent’s interests in the Prepetition Senior Collateral from and after the Petition Date (the amount of such diminution, the “Adequate Protection Senior Obligations”) including, without limitation, any such diminution resulting from the following: (i) the use by the Debtors of the Prepetition Senior Collateral, including, without limitation, the Cash Collateral, (ii) the imposition of the Postpetition Liens, which will prime the Primed Liens, (iii) the imposition of the automatic stay pursuant to section 362(a) of the Bankruptcy Code, (iv) the physical deterioration, consumption, use, sale, lease, disposition, shrinkage, or decline in market value of the Prepetition Senior Collateral or otherwise, or (v) costs and fees incurred in connection with the Prepetition Senior Loan Documents. 18.

Adequate Protection Junior Obligations. As adequate protection for any

claim of the Prepetition Junior Agent and Prepetition Junior Lenders for diminution in the value of the Prepetition Junior Agent’s interests in the Prepetition Senior Collateral from and after the Petition Date (the amount of such diminution, the “Adequate Protection Junior Obligations”) including, without limitation, any such diminution resulting from the following: (i) the use by the Debtors of the Prepetition Senior Collateral, including, without limitation, the Cash Collateral, (ii) the imposition of the Postpetition Liens, which will prime the Primed Liens, (iii) the imposition of the automatic stay pursuant to section 362(a) of the Bankruptcy Code or (iv) the physical deterioration, consumption, use, sale, lease, disposition, shrinkage, or decline in market value of the Prepetition Senior Collateral or otherwise, the Prepetition Junior Agent and Prepetition Junior Lenders are hereby granted the following:

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Subject to the foregoing requirements set

forth in this paragraph 18, pursuant to sections 361(2), 362, 363(c)(2), and 363(e) of the Bankruptcy Code, the Prepetition Junior Agent, for its benefit and the benefit of the Prepetition Junior Lenders, is hereby granted by each Debtor continuing valid, binding, enforceable and perfected, liens and security interests in and on all of the Postpetition Collateral (the “Adequate Protection Junior Liens”). The Adequate Protection Junior Liens shall be entitled to the same rights, priorities, benefits and protections granted to or conferred upon the Adequate Protection Senior Liens under this Order, except that such Adequate Protection Junior Liens shall be junior and subordinate to the Prepetition Senior Liens and the Adequate Protection Senior Liens. b.

Adequate Protection Junior Claim.

Subject to the foregoing

requirements set forth in this paragraph 18, pursuant to section 507(b) of the Bankruptcy Code, the Prepetition Junior Agent and the Prepetition Junior Lenders shall have an allowed superpriority administrative expense claim (the “Adequate Protection Junior Claim”) against each Debtor and its respective estate. The Adequate Protection Junior Claim shall be entitled to the same rights, priorities, benefits and protections granted to or conferred upon the Adequate Protection Senior Claim under this Order, except that such Adequate Protection Junior Claim shall be junior and subordinate to the Adequate Protection Senior Claim. c.

Adequate Protection Payments. As further adequate protection,

subject to the rights set forth in paragraph 30 hereof, and without limiting any rights of the Prepetition Junior Agent and the Prepetition Junior Lenders under section 506(b) of the Bankruptcy Code which are hereby preserved, and in consideration, and as a requirement, for obtaining the consent of the Prepetition Junior Agent and Prepetition Junior Lenders to the entry of this Order and the Debtors’ consensual use of Cash Collateral as provided herein, the Debtors shall, on a monthly basis, pay or reimburse the Prepetition Junior Agent and Prepetition Junior Lenders for any and all reasonable attorneys’ fees and expenses of the Prepetition Junior Agent and Prepetition Junior Lenders as provided in the Prepetition Junior Loan Agreement, whether -30WEIL:\96084664\2\15465.0003

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accrued prepetition or postpetition, in an amount not to exceed the amounts set forth in the Approved Budget for Prepetition Junior Agent and Prepetition Junior Lenders’ professional fees and expenses, all without further notice, motion or application to, order of, or hearing before, this Court. 19.

Collections. Notwithstanding anything in this Order to the contrary, any

and all claims and liens of the Prepetition Senior Agent and Prepetition Senior Lenders arising with respect to or in connection with this Order or the Prepetition Senior Loan Documents (the “Superior Senior Obligations”), including, without limitation, the Prepetition Senior Obligations, Prepetition Senior Liens, Adequate Protection Senior Obligations, and Adequate Protection Senior Claim, must and shall be indefeasibly paid and satisfied in full in cash or Cash Collateralized (as applicable), before any payment or distribution, whether pursuant to a plan of reorganization, setoff or otherwise, may or can be made to or retained by the Postpetition Agent or any of the Postpetition Lenders (in their respective capacities as such) arising with respect to or in connection with this Order and/or the Postpetition Loan Documents (collectively, the “Subordinate Senior Obligations”). Any payment or distribution, whether in cash, securities or other property, which would otherwise, but for the terms hereof, be payable or deliverable to Postpetition Agent or any Postpetition Lender in respect of or in connection with any Subordinate Senior Obligations shall be paid or delivered directly to the Prepetition Senior Agent (to be held and/or applied by Prepetition Senior Agent in accordance with the terms of this Order and the Prepetition Senior Loan Agreement) until all Superior Senior Obligations are indefeasibly paid and satisfied in full in cash or Cash Collateralized (as applicable). 20.

Waiver of Section 506(c) Claims. Only after entry of the Final Order, no

costs or expenses of administration or other charge, lien, assessment or claim incurred on or after the Petition Date of any Person or entity shall be imposed against the Postpetition Agent, Postpetition Lenders, Prepetition Agents, or Prepetition Secured Lenders, their respective claims or the Prepetition Senior Collateral or Postpetition Collateral under section 506(c) of the -31WEIL:\96084664\2\15465.0003

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Bankruptcy Code or otherwise, and the Debtors hereby irrevocably waive any and all such rights, remedies and benefits under section 506(c) of the Bankruptcy Code. 21.

Other Waivers. Except for the Carve-Out and Prior Liens or as otherwise

permitted by the Prepetition Intercreditor Agreement, no claim or lien having a priority superior to or pari passu with those granted pursuant to this Order to the Postpetition Agent, the Postpetition Lenders, the Prepetition Agents and the Prepetition Secured Lenders, respectively, shall be granted or allowed while any portion of the Postpetition Facility (or any refinancing thereof), the Commitments (as defined in the Postpetition Loan Agreement) thereunder, the Postpetition Obligations, the Adequate Protection Senior Obligations or the Adequate Protection Junior Obligations remain outstanding. Except as expressly permitted by the Postpetition Loan Agreement, but subject to the terms and conditions of the Prepetition Intercreditor Agreement, unless consented to in writing by the Postpetition Agent, no Debtor shall seek entry of any further orders in its Chapter 11 Case which authorize (a) under Bankruptcy Code section 363, the use of Cash Collateral; (b) the obtaining of credit or the incurring of indebtedness pursuant to Bankruptcy Code sections 364(c) or 364(d), (c) the return of goods pursuant to Bankruptcy Code section 546(h) to any creditor of the Debtors or to consent to any creditor taking any setoff against any of such creditorâ&#x20AC;&#x2122;s prepetition indebtedness based upon any such return pursuant to Bankruptcy Code section 553 or otherwise, or (d) the granting mortgages, security interests, or liens in the Postpetition Collateral to any parties other than the Postpetition Agent and Postpetition Lenders pursuant to section 364(d) of the Bankruptcy Code or otherwise. 22.

Automatic Perfection. a.

The Postpetition Liens, the Adequate Protection Senior Liens and

the Adequate Protection Junior Liens shall not be subject to challenge and shall attach and become valid, perfected, enforceable, non-avoidable and effective by operation of law as of the Petition Date without any further notice, act or action of or by any Person or entity, and without the necessity of execution by the Debtors, or the filing or recordation, of any financing -32WEIL:\96084664\2\15465.0003

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statements, security agreements, vehicle lien applications, mortgages, filings with the U.S. Patent and Trademark Office, or other documents. If the Postpetition Agent or either Prepetition Agent hereafter requests that the Debtors execute and deliver to it any financing statements, security agreements, collateral assignments, mortgages, or other instruments and documents considered by such party to be reasonably necessary or desirable to further evidence the perfection of the liens and security interests provided under this Order, then the Debtors are hereby authorized and directed, at their sole cost and expense, to as promptly as practicable execute and deliver such financing statements, security agreements, mortgages, collateral assignments, instruments, and documents, and the Postpetition Agent and Prepetition Agents (as applicable) are hereby authorized to file or record such documents in their respective discretion, in which event all such documents shall be deemed to have been filed or recorded at the time and on the date of entry of this Order, but with the priorities as set forth herein. The Postpetition Agent and Prepetition Agents may (in their respective sole discretion), but shall not be required to, file a certified copy of this Order in any filing or recording office in any state, county or other jurisdiction in which any Debtor has real or personal property and such filing or recording shall be accepted and shall constitute sufficient evidence of perfection of such applicable partiesâ&#x20AC;&#x2122; interests in the Postpetition Collateral at the time and on the date of entry of this Order, but with the priorities as set forth herein. b.

Notwithstanding anything in this Order to the contrary, the

Prepetition Agents and Prepetition Secured Lenders shall not request or file such financing statements, mortgages, notices of lien or similar instruments, or otherwise confirm the perfection of such security interests and liens granted in this Order, unless the Postpetition Agent shall theretofore have done so or consented thereto. c.

To the extent that any applicable non-bankruptcy law would

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Postpetition Loan Documents, or otherwise would impose filing or registration requirements or fees and charges with respect thereto, such law is hereby pre-empted to the maximum extent permitted by the United States Constitution, the Bankruptcy Code, applicable federal law, and the judicial power of the United States Bankruptcy Court; provided that the Postpetition Agent and Prepetition Agents may still take such steps as they wish to perfect their respective security interests and liens under otherwise applicable state law without waiving the benefits of this provision of this Order. 23.

Default Under Other Documents. The Postpetition Agent, the Prepetition

Agents, the Postpetition Lenders and the Prepetition Secured Lenders shall have all rights and remedies with respect to the Debtors and any other rights, remedies, benefits and privileges as are set forth in this Order and the Postpetition Loan Documents (as applicable). Except as otherwise expressly provided herein, notwithstanding anything to the contrary contained in any prepetition or postpetition agreement, contract, document, note or instrument to which any Debtor is a party or under which any Debtor is obligated or bound, any provision that restricts, conditions, prohibits, limits or impairs in any way any Debtor from granting the Postpetition Agent, the Prepetition Agents, the Postpetition Lenders and the Prepetition Secured Lenders the postpetition security interests or liens upon any of its assets, properties or other Postpetition Collateral or otherwise entering into and complying with all of the terms, conditions and provisions of this Order and Postpetition Loan Documents shall be unenforceable against such Debtor, and therefore, shall not adversely affect the validity, priority, perfection or enforceability of the liens, security interests, claims, rights, priorities and/or protections granted to the Postpetition Agent, the Prepetition Agents, the Postpetition Lenders and the Prepetition Secured Lenders pursuant to this Order and/or the Postpetition Loan Documents. 24.

Successors and Assigns. The provisions of this Order and the Postpetition

Loan Documents shall, as applicable, be binding upon and inure to the benefit of the Postpetition Agent, the Prepetition Agents, the Postpetition Lenders, the Prepetition Secured Lenders, and the -34WEIL:\96084664\2\15465.0003

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Debtors and their respective estates, and their respective successors and assigns, including, without limitation, any trustee or other fiduciary hereafter appointed as a legal representative of any of the Debtors or their estates, whether in these Chapter 11 Cases or any Successor Case. 25.

Survival. The provisions of this Order and any actions taken pursuant

thereto: (a) shall survive the entry of any order: (i) converting any of the Chapter 11 Cases to a case under chapter 7 of the Bankruptcy Code; (ii) substantively consolidating any of the Debtors or their respective estates; or (iii) dismissing or closing any of the Chapter 11 Cases; and (b) shall continue in full force and effect notwithstanding the entry of any such order. 26.

Section 364(e); Effect of Modification or Appeal. Based on the findings

set forth in this Order, in consideration for the financing provided under Postpetition Facility, the Postpetition Agent and the Postpetition Lenders are entitled to, and hereby are granted, the full rights, benefits, privileges and protections of, and provided by, section 364(e) of the Bankruptcy Code with respect to the Postpetition Obligations (and related liens, claims, rights, remedies and benefits) created or authorized by this Order in the event that this Order or any authorization or approval contained herein is subsequently stayed, vacated, reversed, amended or modified on appeal. Any subsequent stay, modification, reversal, amendment or vacation of this Order shall not alter, modify or affect the validity, priority, perfection or enforceability of any claim, lien, or security interest of the Postpetition Agent, the Prepetition Agents, the Postpetition Lenders, or the Prepetition Secured Lenders authorized, created or granted pursuant to this Order and outstanding immediately prior to the actual receipt of written notice by the Postpetition Agent and Prepetition Agents of the effective date of such stay, modification, reversal, amendment or vacation. Notwithstanding any such stay, modification, reversal, amendment or vacation, all obligations and other financial accommodations made pursuant to this Order, all Postpetition Obligations incurred and uses of Cash Collateral permitted by the Debtors pursuant hereto prior to the actual receipt of written notice by the Postpetition Agent and Prepetition Agents of the effective date of such stay, modification, reversal, amendment or vacation, shall be governed in -35WEIL:\96084664\2\15465.0003

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all respects by the original provisions of this Order and the Postpetition Agent, the Prepetition Agents, the Postpetition Lenders, and the Prepetition Secured Lenders shall be entitled to all of the rights, privileges, remedies, protections and benefits contained or granted in section 364(e) of the Bankruptcy Code, the Postpetition Loan Documents and this Order (as applicable), including, without limitation, the Postpetition Liens, Super-Priority Claims, Adequate Protection Senior Liens, Adequate Protection Senior Claims, Adequate Protection Junior Liens and Adequate Protection Senior Claims. 27.

Modification of Automatic Stay; Other Remedies. a.

Subject to sub-paragraph (c) below, the automatic stay pursuant to

section 362 of the Bankruptcy Code is hereby modified as to the Postpetition Agent and Postpetition Lenders to the extent necessary to permit them to perform in accordance with, provide any notice under, and exercise, enjoy and enforce their respective rights, benefits, privileges and remedies pursuant to this Order and the other Postpetition Loan Documents, in each case without further notice, motion or application to, order of, or hearing before, this Court. Subject to sub-paragraph (c) below, regardless of any change in circumstances (whether or not foreseeable), neither section 105 of the Bankruptcy Code nor any other provision of the Bankruptcy Code or applicable law shall be utilized to prohibit the Postpetition Agentâ&#x20AC;&#x2122;s or Postpetition Lendersâ&#x20AC;&#x2122; exercise, enjoyment and enforcement of any of such rights, benefits, privileges and remedies as and to the extent provided in this Order. b.

Subject to sub-paragraph (c) below, the Postpetition Agent and

Postpetition Lenders are hereby authorized and granted leave from the automatic stay under section 362 of the Bankruptcy Code to do the following on and after the occurrence and continuation of an Event of Default under the Postpetition Loan Agreement (or otherwise on and after the Commitment Termination Date), in each case without further notice, motion or application to, order of, or hearing before, this Court:

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(i)

terminate any obligation of Postpetition Agent or Postpetition Lenders to make loans or other extensions of credit under the Postpetition Loan Documents or this Order;

(ii)

declare all Postpetition Obligations immediately due and payable in full in cash, and require that all letters of credit and other contingent obligations related thereto, if any, to be cash collateralized or terminated without liability to Postpetition Agent or Postpetition Lenders;

(iii)

revoke the Debtorsâ&#x20AC;&#x2122; right, if any, under this Order and/or the other Postpetition Loan Documents to use Cash Collateral; and

(iv)

receive and apply proceeds of Postpetition Collateral to the Postpetition Obligations and Prepetition Senior Obligations in accordance with the terms and conditions of this Order and the Postpetition Loan Documents.

On and after the occurrence and continuation of an Event of

Default under the Postpetition Loan Agreement (or otherwise on and after the Commitment Termination Date), and after obtaining Court approval upon notice and hearing, the Postpetition Agent and the Postpetition Lenders shall be entitled to foreclose or otherwise enforce their respective liens on any or all of the Postpetition Collateral and/or to exercise any other defaultrelated rights and remedies under the Postpetition Loan Documents, this Order and applicable law to the extent not already permitted pursuant to sub-paragraph (b) above. The parties shall use their best efforts to schedule and attend an expedited Court hearing within seven days of notice of the Event of Default or Commitment Termination Date being given to the Debtors, the United States Trustee, and the Creditorsâ&#x20AC;&#x2122; Committee. The Debtors acknowledge and agree, and this Court hereby orders, that the only issue to be determined and decided at any Court hearing regarding such matters is whether an Event of Default has occurred and is continuing under the Postpetition Loan Agreement or whether the Commitment Termination Date has occurred and notice of such hearing need only be given to the Debtors, counsel to the Prepetition Junior Agent, any statutory committee of unsecured creditors and the U.S. Trustee. -37WEIL:\96084664\2\15465.0003

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No Waiver of Rights. a.

Generally.

Without limiting the terms and conditions of

paragraphs 9 through 12 and 19 of this Order, none of the Postpetition Agent, Postpetition Lenders, Prepetition Agents, or Prepetition Secured Lenders waives, and each expressly reserves, any and all claims, causes of action, defenses, rights and remedies it has or may have pursuant to any or all of the Prepetition Senior Loan Documents, the Prepetition Junior Loan Documents, the Postpetition Loan Documents, the Prepetition Intercreditor Agreement, any other inter-creditor or subordination agreement, the Bankruptcy Code and/or under applicable law against or with respect to any Debtor and any other Person or entity. b.

Relative Priorities; Prepetition Intercreditor Agreement.

determining the relative priorities, rights and remedies of the Prepetition Agents and Prepetition Secured Parties (including, without limitation, the relative priorities and rights of such parties with respect to the replacement liens and administrative expense claims granted, or amounts payable, by the Debtors under this Order and the modification of the automatic stay), such priorities, rights and remedies shall, pursuant to section 510 of the Bankruptcy Code, continue to be governed by the Prepetition Intercreditor Agreement, and, without limiting the terms and conditions of paragraphs 9 through 12 and 19 of this Order, nothing in this Order or the Postpetition Loan Documents shall, or shall be deemed to, alter, amend, modify, impair, diminish or otherwise affect the terms and conditions of the Prepetition Intercreditor Agreement, which terms and conditions remain in full force and effect as between or among such parties. Furthermore, pursuant to section 510 of the Bankruptcy Code, any other inter-creditor or subordination agreement between and/or among the Prepetition Agents, any Prepetition Secured Lender, any Debtor and any other non-Debtor party thereto, and any other applicable intercreditor or subordination provisions contained in any credit agreement, security agreement, indenture or related document, remain in full force and effect and are not amended, altered or modified by the terms of this Order or the Postpetition Loan Documents. -38WEIL:\96084664\2\15465.0003

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Additional Rights Preserved. Without limiting the generality of

this paragraph 28, but subject to the Prepetition Intercreditor Agreement, the Postpetition Agent, Postpetition Lenders, Prepetition Agents and Prepetition Secured Lenders may, as applicable, petition this Court for any such additional protection they may reasonably require with respect to the Prepetition Senior Obligations, the Prepetition Junior Obligations, the Postpetition Obligations, or otherwise, including, without limitation, their rights to request additional adequate protection of their interests in the Prepetition Senior Collateral. Except as otherwise set forth herein, but subject to the Prepetition Intercreditor Agreement, entry of this Order shall not in any way constitute agreement, consent, or acquiescence by the Postpetition Agent, Postpetition Lenders, Prepetition Agents or Prepetition Secured Lenders to the terms of any plan of reorganization filed in the Chapter 11 Cases. 29.

Restriction on Use of Lendersâ&#x20AC;&#x2122; Funds. No portion of the Postpetition

Facility, the Postpetition Collateral, the Prepetition Senior Collateral, the Cash Collateral, or the Carve-Out, and no disbursements set forth in the Approved Budget, shall be used for the payment of professional fees, disbursements, costs or expenses incurred in connection with asserting any claims, actions or causes of action against or adverse to the interests of any of the Postpetition Agent, Postpetition Lenders, Prepetition Senior Agent, Prepetition Junior Agent, Prepetition Senior Lenders, or Prepetition Junior Lenders, including, without limitation, any action challenging or raising any defenses to the Postpetition Obligations, the Prepetition Senior Obligations, the Prepetition Junior Obligations, the Postpetition Liens, the Prepetition Senior Liens, or the Prepetition Junior Liens; provided, that no more than $25,000 in the aggregate of the proceeds of the Postpetition Facility or the Postpetition Collateral (including Cash Collateral) may be used by the Creditorsâ&#x20AC;&#x2122; Committee (if one is formed) to investigate the Prepetition Senior Obligations, Prepetition Junior Obligations, the Prepetition Senior Liens, and the Prepetition Junior Liens.

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Release of Claims Against Prepetition Agents and Prepetition Secured

Lenders. The stipulations and admissions contained in Paragraph D of this Order, shall be binding on all parties in interest, including, without limitation, the Creditors’ Committee, unless, and solely to the extent that, (a) the Creditors’ Committee, or another party in interest, to the extent each has obtained Court approved standing and requisite authority, and has timely filed a complaint and commenced an adversary proceeding (subject to the limitations set forth in paragraph 29 of this Order) challenging the amount, extent, validity, or enforceability of the Prepetition Senior Obligations and/or the Prepetition Junior Obligations, or the perfection or priority of the Prepetition Senior Liens and/or the Prepetition Junior Liens, or otherwise asserting any claims or causes of action on behalf of the Debtors’ estates against the Prepetition Senior Agent or the Prepetition Senior Lenders relating to the Prepetition Senior Obligations, or the Prepetition Junior Agent or Prepetition Junior Lenders relating to the Prepetition Junior Obligations, in each case no later than the earlier of (x) sixty (60) days after the date of appointment of the Creditors’ Committee or (y) seventy-five (75) days after the Petition Date (such earlier date, the “Complaint Filing Deadline”), and (b) this Court rules in favor of the plaintiff in any such timely and properly commenced adversary proceeding. If no such adversary proceeding is timely and properly commenced by the Complaint Filing Deadline, or to the extent such adversary proceeding does not result in a final and non-appealable order of this Court that is inconsistent with the acknowledgments of the Debtors contained in paragraph D of this Order, then, without the requirement or need to file any proof of claim with respect thereto and without further notice, motion or application to, order of, or hearing before, this Court, but in all cases subject to the Prepetition Intercreditor Agreement and paragraph 28 of this Order, the acknowledgments of the Debtors contained in paragraph D of this Order with respect to the Prepetition Agents, Prepetition Secured Lenders, Prepetition Senior Loan Documents, Prepetition Junior Loan Documents, Prepetition Senior Liens, Prepetition Junior Liens, Prepetition Senior Obligations, Prepetition Junior Obligations, and Prepetition Senior Collateral -40WEIL:\96084664\2\15465.0003

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shall be binding, conclusive and final on the Creditors’ Committee and any other Person, entity or party-in-interest in the Chapter 11 Cases and any Successor Case and (i) the claims, liens and security interests of the Prepetition Senior Agent, Prepetition Junior Agent, the Prepetition Senior Lenders, and the Prepetition Junior Lenders shall be deemed to be finally allowed for all purposes in these Chapter 11 Cases and any Successor Case and shall not be subject to challenge by any party in interest as to validity, priority or otherwise, and (ii) the Debtors and their estates shall be deemed to have forever released any and all claims or causes of action against the Prepetition Senior Agent and the Prepetition Senior Lenders with respect to the Prepetition Senior Loan Documents, or any related transactions, and the Prepetition Junior Agent and the Prepetition Junior Lenders with respect to the Prepetition Junior Loan Documents, or any related transactions. Notwithstanding anything to the contrary herein, if any such adversary proceeding is timely commenced, the stipulations contained in paragraph D hereof shall nonetheless remain binding on all parties in interest and preclusive (as provided in the second sentence of this paragraph 30) except to the extent that such stipulations are expressly challenged in such adversary proceeding. 31.

No Marshaling. Only after entry of the Final Order, the Postpetition

Agent, the Prepetition Agents, the Postpetition Lenders, and the Prepetition Secured Lenders shall not be subject to the equitable doctrine of “marshaling”, “election of remedies” or any other similar doctrine, or an “equities of the case” claim under section 552(b) of the Bankruptcy Code, in each case with respect to any of its respective interests in the Postpetition Collateral and Prepetition Senior Collateral. 32.

No Vicarious Liability. In making decisions to advance loans to the

Debtors, in administering any loans, in permitting the Debtors to use Cash Collateral, in approving any budget or in taking any actions permitted by this Order or the Postpetition Loan Documents, as applicable, the Postpetition Agent, the Prepetition Senior Agent, the Postpetition Lenders and the Prepetition Senior Lenders shall not (i) be deemed to be in control of the -41WEIL:\96084664\2\15465.0003

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operations of any Debtor or to be acting as a “controlling person,” “responsible person” or “owner or operator” with respect to the operation or management of any Debtor, and/or (ii) owe any fiduciary duty to any Debtor, its respective creditors or its respective estate, and their relationship with each Debtor shall not constitute or be deemed to constitute a joint venture or partnership with such Debtor. 33.

Insurance. To the extent that Wells Fargo, in its role as Prepetition Senior

Agent, is listed as loss payee under the Debtors’ insurance policies, Wells Fargo, in its role as Postpetition Agent, is also deemed to be the loss payee under the Debtors’ insurance policies and shall act in that capacity and distribute any proceeds recovered or received in respect of any such insurance policies in accordance with the terms and conditions of this Order and the Postpetition Loan Documents. 34.

Payments Held in Trust. Except as expressly permitted in this Order or

the Postpetition Loan Documents, in the event that any person or entity receives any payment on account of a security interest in Collateral, receives any Collateral or any proceeds of Collateral or receives any other payment with respect thereto from any source prior to the indefeasible payment in full in cash of all Prepetition Senior Obligations and Postpetition Obligations, and termination of the Postpetition Facility in accordance with the Postpetition Loan Documents, such person or entity shall be deemed to have received, and shall hold, any such payment or proceeds of Collateral in trust for the benefit of the Postpetition Agent, Postpetition Lenders, Prepetition Senior Agent, and Prepetition Senior Lenders and shall immediately turn over such proceeds to the Postpetition Agent for application to the Postpetition Obligations or the Prepetition Senior Agent for application to the Prepetition Senior Obligations, or as otherwise instructed by this Court, for application in accordance with the Postpetition Loan Documents and this Order. 35.

Additional Defaults. In addition and without limitation of the Events of

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Order, it shall be a default hereunder (and constitute an â&#x20AC;&#x153;Event of Defaultâ&#x20AC;? under the Postpetition Loan Agreement and this Order) if (a) an order is entered dismissing or converting any of the Chapter 11 Cases under section 1112 of the Bankruptcy Code or appointing a Chapter 11 trustee or an examiner with expanded powers, (b) a sale of substantially all assets is proposed by the Debtors without the written consent of the Postpetition Agent, Prepetition Senior Agent, Postpetition Lenders, and Prepetition Senior Lenders that would not indefeasibly pay the DIP Obligations in full in cash, (c) any other motion is filed by the Debtors for any relief directly or indirectly negatively affecting the Postpetition Collateral in a material manner unless all Prepetition Senior Obligations and Postpetition Obligations have been indefeasibly paid in final, in full, in cash, and completely satisfied upon consummation of the transaction contemplated thereby and such motion is otherwise approved of in writing by Postpetition Agent and Postpetition Lenders, (d) the Debtors fail to comply with any of the terms of, or its covenants under, this Order, the Approved Budget (subject to all applicable variances), or any stipulation or representation by the Debtors stated herein is false or misleading, (e) the entry of any order providing for the sale of substantially all of the assets of the Debtors under section 363 of the Bankruptcy Code shall be entered by this Court unless, upon the closing of such transaction, all liens securing the Postpetition Obligations and Prepetition Senior Obligations (in their respective priority) are transferred to the proceeds of such sale and such proceeds or are applied to permanently and indefeasibly repay the Postpetition Obligations and Prepetition Senior Obligations, as applicable, in full, in cash, or (f) the termination of the Stalking Horse Bid unless the Debtors have accepted a higher or better competing bid which provides for the permanent and indefeasible payment in full of the Postpetition Obligations and Prepetition Senior Obligations, as applicable, in cash, and provides for payment of expenses for the wind-down of

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Debtors’ bankruptcy estates in an amount greater than that provided for by the Stalking Horse Bid. Any order for dismissal or conversion shall be automatically deemed to preserve the rights of the Postpetition Agent, Prepetition Senior Agent, Prepetition Junior Agent, Postpetition Lenders, Prepetition Senior Lenders, and Prepetition Junior Lenders under this Order. If an order dismissing any of these Chapter 11 Cases under section 305 or 1112 of the Bankruptcy Code or otherwise is at any time entered, (i) the claims, security interests, liens and claims granted to or for the benefit of the Postpetition Agent, Postpetition Lenders, Prepetition Senior Agent, and Prepetition Senior Lenders pursuant to this Order shall continue in full force and effect and shall maintain their priorities as provided in this Order, as applicable, until all Postpetition Obligations and Prepetition Senior Obligations shall have been paid and satisfied in full (and that such claims and liens, shall, notwithstanding such dismissal, remain binding on all parties in interest), (ii) the claims, security interests, liens and claims granted to or for the benefit of the Prepetition Junior Agent and Prepetition Junior Lenders pursuant to this Order shall continue in full force and effect and shall maintain their priorities as provided in this Order, as applicable, until all Prepetition Junior Obligations shall have been paid and satisfied in full (and that such claims and liens, shall, notwithstanding such dismissal, remain binding on all parties in interest), and (iii) this Court shall retain jurisdiction, notwithstanding such dismissal, for the purposes of enforcing such claims and liens. 36.

Master Proof of Claim. The Prepetition Senior Agent shall be authorized

(but not required) to file a master proof of claim against the Debtors (the “Master Proof of Claim”) on behalf of itself and the Prepetition Senior Lenders on account of their prepetition claims arising under the Prepetition Senior Loan Documents, and the Prepetition Senior Agent shall not be required to file a verified statement pursuant to Bankruptcy Rule 2019. If the Prepetition Senior Agent so files a Master Proof of Claim against the Debtors, the Prepetition -44WEIL:\96084664\2\15465.0003

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Senior Agent (on its behalf and on behalf of each Prepetition Senior Lender), and each of its successors and assigns, shall be deemed to have filed a proof of claim in the aggregate amount set forth therein in each of the Chapter 11 Cases and any Successor Case, and the claims of the Prepetition Senior Agent and each Prepetition Senior Lender (and its successors and assigns) contained in the Master Proof of Claim shall be allowed or disallowed as if each such entity had filed a separate proof of claim in each Chapter 11 Case in the aggregate amount set forth therein. The Prepetition Senior Agent shall further be authorized to amend its respective Master Proof of Claim from time to time to, among other things, reflect a change in the holders of the claims set forth therein or a reallocation among such holders of the claims asserted therein resulting from any transfer of such claims. The provisions set forth in this Paragraph and any Master Proof of Claim filed pursuant to the terms hereof are intended solely for the purpose of administrative convenience and shall not affect the substantive rights of any party in interest or their respective successors in interest, including, without limitation, the rights of the Prepetition Senior Agent and the Prepetition Senior Lenders as the holder of a claim against the Debtors under applicable law, and the numerosity requirements set forth in section 1126 of the Bankruptcy Code. 37.

Final Hearing; Procedure for Objections to and Entry of Final Order. The

Motion is set for a Final Hearing before this Court at [___] [A.M./P.M.] Eastern time on [_______], 2017, at which time any party in interest may present any timely filed objections to the entry of the Final Order, which order shall be in form and substance acceptable to the Postpetition Agent in its sole discretion. The Debtors shall, in accordance with the Bankruptcy Code, Bankruptcy Rules and Local Bankruptcy Rules of this Court, promptly serve a notice of the Final Hearing and entry of this Order, together with a copy of this Order, by electronic mail, facsimile, hand delivery or overnight delivery to the Notice Parties and Creditorsâ&#x20AC;&#x2122; Committee (once appointed) or its counsel. Such notice shall state that objections to the entry of the Final Order shall be in writing and shall be filed with the United States Bankruptcy Court for the Southern District of New York by no later than 4:00 P.M. (Prevailing Eastern time) on [___], -45WEIL:\96084664\2\15465.0003

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2017 (the â&#x20AC;&#x153;Objection Deadlineâ&#x20AC;?), which objections shall be served so that the same are actually received by the Objection Deadline by: (i) Matthew S. Barr, Esq. and Jill Frizzley, Esq., Weil, Gotshal & Manges LLP, New York, 767 Fifth Avenue, New York, New York 10153, fax (212310-8007), matt.barr@weil.com and jill.frizzley@weil.com (counsel to the Debtors), (ii) David B. Kurzweil, Esq. and John Dyer, Esq., Greenberg Traurig, LLP, Terminus 200, 3333 Piedmont Road, N.E., Suite 2500, Atlanta, Georgia 30305, fax (678-553-2681 and 679-553-2236), kurzweild@gtlaw.com and dyerj@gtlaw.com (counsel to the Postpetition Agent & Prepetition Senior Agent); (iii) Brian S. Hermann, Esq. and Lauren Shemejda, Esq., Paul, Weiss, Rifkind, Wharton & Garrison LLP, 1285 Avenue of the Americas, New York, NY 10019, fax (212-3733545 and 212-492-0559), bhermann@paulweiss.com and lshumejda@paulweiss.com and Renee P. Lewis, Esq., Holland and Knight, LLP, 131 South Dearborn Street, 30th Floor, Chicago, IL 60603 fax (312-578-6666), renee.lewis@hklaw.com (counsel to Prepetition Junior Agent), (iv) Richard Morrissey, Esq, 201 Varick Street, Suite 1006, New York, New York, 10014, richased.morrissey@usdoj.com (the office of the United States Trustee). Any objections by creditors or other parties-in-interest to any of the provisions of the Final Order shall be deemed forever waived and barred unless timely filed and served in accordance with this paragraph.

Dated: ______________, 2017. ___________________________________ UNITED STATES BANKRUPTCY JUDGE

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EXHIBIT A

Initial Approved Budget

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Doc 21 1 4/8

Week Ending:

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2 4/15

3 4/22

4 4/29

5 5/6

6 5/13

7 5/20

8 5/27

9 6/3

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10 6/10

11 6/17

12 6/24

13 7/1

13 Week Total

CASH FLOW Receipts Operating Receipts (incl. sales tax collections)$ Other Receipts Total Receipts $ Operating Disbursements Linen Purchases - Medline Linen Purchases - All Other Vendors Employee Costs Rent and Capital Leases Equipment Lease Payments Utilities Repairs & Maintenance Operating Supplies Fuel Insurance and WC Claims Taxes Other OPEX and SG&A Total Operating Disbursements Operating Cash Flow

6,431 6,431

$ $

6,621 6,621

$ $

(645) $ (788) (3,670) (483) (569) (383) (355) (422) (67) (153) (90) (289) (7,915) $

(645) $ (788) (2,824) (383) (863) (237) (326) (68) (220) (466) (472) (7,294) $

(1,483) $

(673) $

Non-Operating Disbursements Environmental CAPEX

6,868 6,868

$ $

- $ (789) (3,731) (82) (850) (226) (373) (67) (182) (276) (6,576) $ 292

(50)

(250) (50)

(1,500) (375) -

(1,500) (25) -

(500) -

(48) (1,623) $

(48) (848) $

(48) (1,973) $

Total Disbursements

(9,888) $

(8,917) $

(7,424) $

Net Cash Flow

(3,456) $

(2,296) $

(556) $

- $ 6,431 (6,431) (9,888) 9,888 - $

- $ 6,621 (6,621) (8,917) 8,917 - $

- $ 6,868 (6,868) (7,424) 7,424 - $

LIQUIDITY Availability Cash Liquidity Borrowing Base (+) A/R (+) Inventory (+) Fixed Assets (-) Reserves (+ / -) Timing Adjustment Total Borrowing Base Prepetition Revolver Beginning Revolver and LC Balance (+/-) Revolver Borrowings / (Repayments) (+) Revolver Interest and Fees Ending Revolver and LC Balance DIP Revolver Beginning Revolver Balance (+/-) Revolver Borrowings / (Repayments) Ending Revolver Balance (+) Professional Fee Carve Out (+) Reserve for Taxes CUMULATIVE ADJUSTED DIP NEED Secured Debt Outstanding Balances DIP 1st Lien 2nd Lien (GA) 2nd Lien (KKR) Total Secured Debt Post-Petition Linen Trade A/P

$ $ $ $

$ $

9,027 9,027

$ $

7,072 7,072

$ $

7,047 7,047

$ $

- $ (788) (2,424) (109) (278) (319) (372) (67) (151) (6) (99) (4,613) $ 2,102

(50)

Bankruptcy Impact Critical Vendor Payments Utilities Restricted Cash Adequate Protection (1st Lien) DIP Fee [1] BOD Fees Professional Fees US Trustee Fees Interest on DIP Balance Wind-Down Costs Employees Other Taxes Total Non-Operating Disbursements

Book Cash Roll Forward Beginning Balance (+) Cash Receipts (-) Pay Down of Prepetition Revolver (-) Cash Disbursements (+/-) DIP Borrowings / (Repayments) Ending Balance

6,715 6,715

$ $

(646) $ (72) (3,872) (483) (371) (463) (267) (372) (67) (389) (1) (412) (7,414) $ (554) $

7,131 7,131

$ $

(644) $ (71) (2,709) (86) (851) (206) (321) (67) (151) (223) (235) (5,565) $ 1,567

7,039 7,039

$ $

(644) $ (357) (3,834) (167) (535) (240) (321) (67) (191) (558) (464) (7,376) $ (337) $

(50)

(250) (50)

(201) (96)

(480) -

(25) -

(296) (346) $

(48) (395) $

(48) (578) $

(48) (373) $

(4,959) $

(7,810) $

(6,143) $

(7,749) $

6,822 38 6,860

1,756

(949) $

- $ 6,715 (6,715) (4,959) 4,959 - $

- $ 6,860 (6,860) (7,810) 7,810 - $

9,147 9,147

$ $

8,339 8,339

$ $

989

- $ 7,131 (7,131) (6,143) 6,143 - $

- $ 7,039 (7,039) (7,749) 7,749 - $

9,028 9,028

- $ (357) (2,560) (69) (266) (172) (320) (67) (162) (0) (115) (4,088) $ 2,934

$ $

(48) (392) $

(48) (2,667) $

(4,750) $

(7,449) $

$ $

(644) $ (355) (2,544) (91) (261) (172) (313) (67) (171) (10) (115) (4,744) $ 2,240

(640) (355) (3,935) (1,931) (415) (446) (235) (319) (67) (151) (12) (259) (8,764)

(6,432) (5,790) (43,014) (3,380) (3,101) (6,761) (3,144) (4,423) (871) (2,415) (1,840) (3,767) (84,937)

(1,754)

4,982

89,806 113 89,920

(147) (197) $

(48) (113)

(259) (2,220) (198) (11,665)

(8,728) $

(8,969) $

(4,941) $

(8,877)

(96,602)

(201) $

(1,728) $

(1,979) $

(1,867)

(6,682)

- $ 7,022 (2,852) (4,750) 579 - $

- $ 7,248 (7,449) 201 - $

- $ 7,000 (8,728) 1,728 - $

- $ 6,990 (8,969) 1,979 - $

- $ 6,984 (4,941) (2,043) - $

7,010 (8,877) 1,867 -

89,920 (50,517) (96,602) 57,199 -

11,176 11,176

10,910 10,910

7,150 7,150

2,272

$ $

23,882 $ (6,860) 17,022 $

17,022 $ (7,131) 9,890 $

9,890 $ (7,039) 2,852 $

2,852 $ (2,852) - $

9,888 8,917 18,805

18,805 7,424 26,229

26,229 4,959 31,188

31,188 7,810 38,997

38,997 6,143 45,140

45,140 7,749 52,889

52,889 579 53,469

6,600 1,000 26,405

6,600 1,000 33,829

6,600 1,000 38,788

6,600 1,000 46,597

6,600 1,000 52,740

6,600 1,000 60,489

6,600 1,000 61,069

$ $

29,774 $ 33,430 9,273 (503) 206 72,179 $

53,469 201 53,669

6,600 1,000 61,269

9,242 9,242

$ $

29,668 $ 33,584 9,211 (503) 279 72,239 $

53,669 1,728 55,397

6,600 1,000 62,997

6,997 6,997

(50)

6,972 38 7,010

(222) (848) (120) (1,498) $

30,597 $ (6,715) 23,882 $

(481) $

(37) (497) (78) (661) $

37,465 $ (6,868) 30,597 $

6,600 1,000 17,488

(641) $ (357) (3,832) (254) (706) (240) (325) (66) (191) (462) (397) (7,471) $

6,984 6,984

(2,000) (1,500) (218) (375) (58) (3,033) (405)

44,086 $ (6,621) 37,465 $

940

(15)

50,517 $ (6,431) 44,086 $

191

30,160 $ 33,248 9,334 (503) 6 72,244 $

(641) $ (356) (3,143) (412) (542) (206) (320) (68) (151) (1) (221) (6,060) $

(8) -

30,192 $ 33,094 9,395 (503) 190 72,369 $

(642) $ (357) (3,936) (483) (93) (317) (267) (320) (67) (153) (10) (412) (7,057) $

6,990 6,990

(17) (2,553) -

30,129 $ 33,162 9,457 (503) (25) 72,219 $

(294)

30,349 $ 33,005 9,518 (503) (411) 71,958 $

(750) (650)

30,296 $ 32,846 9,580 (503) (402) 71,817 $

7,000 7,000

(50)

30,148 $ 32,684 9,629 (503) (485) 71,473 $

(250) (50)

30,120 $ 32,522 9,678 (503) (876) 70,941 $

9,888 9,888

(50)

29,704 $ 32,545 9,727 (503) (873) 70,600 $

7,210 38 7,248

(50)

(710) $

(50)

9,589 9,589

7,022 7,022

$ $

29,739 $ 33,564 9,150 (503) 23 71,973 $

55,397 1,979 57,376

6,600 1,000 64,976

2,043

9,028 9,028

$ $

29,644 $ 33,716 9,088 (503) 15 71,960 $

$ $

57,376 $ (2,043) 55,332 $

55,332 1,867 57,199

6,600 1,000 62,932

6,600 1,000 64,799

29,672 33,854 9,039 (503) (113) 71,950

7,150 7,150 29,672 33,854 9,039 (503) (113) 71,950

50,517 (50,517) (0)

57,199 57,199

6,600 1,000 64,799

17,488 44,086 24,525 61,002 $ 147,100

26,405 37,465 24,525 61,002 $ 149,397

33,829 30,597 24,525 61,002 $ 149,953

38,788 23,882 24,525 61,002 $ 148,197

46,597 17,022 24,525 61,002 $ 149,146

52,740 9,890 24,525 61,002 $ 148,158

60,489 2,852 24,525 61,002 $ 148,868

61,069 24,525 61,002 $ 146,596

61,269 24,525 61,002 $ 146,796

62,997 24,525 61,002 $ 148,524

64,976 24,525 61,002 $ 150,503

62,932 24,525 61,002 $ 148,459

64,799 24,525 61,002 $ 150,326

64,799 24,525 61,002 150,326

6,324

[1] DIP arrangement fee of $50k and facility fee of 50bps on the $65M.

646

1,290

2,003

2,715

3,140

4,207

4,639

5,063

5,486

5,899

6,324