EXECUTION COPY
CREDIT AGREEMENT
Dated as of July 27, 2001
Among
THE FINANCIAL INSTITUTIONS NAMED HEREIN,
AS THE LENDERS;
BANK OF AMERICA, N.A.,
AS THE ADMINISTRATIVE AGENT;
CITICORP USA, INC.,
AS THE DOCUMENTATION AGENT;
HELLER FINANCIAL, INC.,
AS THE SYNDICATION AGENT;
FLEETWOOD ENTERPRISES, INC.,
AS A GUARANTOR;
and
FLEETWOOD HOLDINGS INC., and certain of its Subsidiaries,
and
FLEETWOOD RETAIL CORP., and certain of its Subsidiaries,
AS THE BORROWERS.
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TABLE OF CONTENTS
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PAGE
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ARTICLE 1 LOANS AND LETTERS OF CREDIT..........................................................2
1.1 Total Facility...............................................................2
1.2 Revolving Loans..............................................................2
1.3 Term Loans...................................................................6
1.4 Letters of Credit............................................................6
1.5 Bank Products...............................................................10
1.6 Joint and Several Obligations; Contribution Rights..........................11
1.7 Borrowing Agency Provisions.................................................15
1.8 Senior Debt.................................................................17
ARTICLE 2 INTEREST AND FEES...................................................................17
2.1 Interest....................................................................17
2.2 Continuation and Conversion Elections.......................................17
2.3 Maximum Interest Rate.......................................................18
2.4 Closing Fee.................................................................19
2.5 Unused Line Fee.............................................................19
2.6 Letter of Credit Fee........................................................19
ARTICLE 3 PAYMENTS AND PREPAYMENTS............................................................20
3.1 Revolving Loans.............................................................20
3.2 Termination of Facility.....................................................20
3.3 Repayment of the Term Loans.................................................20
3.4 Prepayments of the Loans....................................................21
3.5 LIBOR Rate Loan Prepayments.................................................22
3.6 Payments by the Borrowers...................................................22
3.7 Payments as Revolving Loans.................................................22
3.8 Apportionment, Application and Reversal of Payments.........................23
3.9 Indemnity for Returned Payments.............................................23
3.10 The Agent's and Lenders' Books and Records; Monthly Statements..............24
3.11 Release of FRC Borrower.....................................................24
ARTICLE 4 TAXES, YIELD PROTECTION AND ILLEGALITY..............................................25
4.1 Taxes.......................................................................25
4.2 Illegality..................................................................26
4.3 Increased Costs and Reduction of Return.....................................27
4.4 Funding Losses..............................................................27
4.5 Inability to Determine Rates................................................28
4.6 Certificates of the Agent...................................................28
4.7 Survival....................................................................28
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ARTICLE 5 BOOKS AND RECORDS; FINANCIAL INFORMATION; NOTICES...................................28
5.1 Books and Records...........................................................28
5.2 Financial Information.......................................................28
5.3 Notices to the Lenders......................................................31
ARTICLE 6 GENERAL WARRANTIES AND REPRESENTATIONS..............................................33
6.1 Authorization, Validity, and Enforceability of this Agreement and the
Loan Documents..............................................................34
6.2 Validity and Priority of Security Interest..................................34
6.3 Organization and Qualification..............................................34
6.4 Corporate Name; Prior Transactions..........................................34
6.5 Subsidiaries and Affiliates.................................................35
6.6 Financial Statements and Projections........................................35
6.7 Capitalization..............................................................35
6.8 Solvency....................................................................36
6.9 Debt........................................................................36
6.10 Distributions...............................................................36
6.11 Real Estate; Leases.........................................................36
6.12 Proprietary Rights..........................................................36
6.13 Trade Names.................................................................36
6.14 Litigation..................................................................37
6.15 Labor Disputes..............................................................37
6.16 Environmental Laws..........................................................37
6.17 No Violation of Law.........................................................38
6.18 No Default..................................................................38
6.19 ERISA Compliance............................................................38
6.20 Taxes.......................................................................39
6.21 Regulated Entities..........................................................39
6.22 Use of Proceeds; Margin Regulations.........................................39
6.23 Copyrights, Patents, Trademarks and Licenses, etc...........................39
6.24 No Material Adverse Change..................................................40
6.25 Full Disclosure.............................................................40
6.26 Material Agreements.........................................................40
6.27 Bank Accounts...............................................................40
6.28 Governmental Authorization..................................................40
6.29 Senior Debt.................................................................40
ARTICLE 7 AFFIRMATIVE AND NEGATIVE COVENANTS..................................................40
7.1 Taxes and Other Obligations.................................................41
7.2 Legal Existence and Good Standing...........................................41
7.3 Compliance with Law and Agreements; Maintenance of Licenses.................41
7.4 Maintenance of Property; Inspection of Property.............................41
7.5 Insurance...................................................................42
7.6 Insurance and Condemnation Proceeds.........................................43
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7.7 Environmental Laws..........................................................43
7.8 Compliance with ERISA.......................................................44
7.9 Mergers, Consolidations or Sales............................................45
7.10 Distributions; Capital Change; Restricted Investments.......................46
7.11 Transactions Affecting Collateral or Obligations............................47
7.12 Guaranties..................................................................47
7.13 Debt........................................................................48
7.14 Prepayment..................................................................50
7.15 Transactions with Affiliates................................................50
7.16 Investment Banking and Finder's Fees........................................50
7.17 Business Conducted..........................................................51
7.18 Liens.......................................................................51
7.19 Sale and Leaseback Transactions.............................................51
7.20 New Subsidiaries............................................................51
7.21 Fiscal Year.................................................................51
7.22 Capital Expenditures........................................................51
7.23 Fixed Charge Coverage Ratio.................................................52
7.24 EBITDA......................................................................52
7.25 Minimum Aggregate Availability..............................................52
7.26 Contribution of Management Fees.............................................53
7.27 Use of Proceeds.............................................................53
7.28 Further Assurances; Additional Mortgages....................................53
7.29 Subordinated Debt; Trust Securities.........................................54
7.30 Advisors for Sale of Term Loan Collateral...................................54
ARTICLE 8 CONDITIONS OF LENDING...............................................................55
8.1 Conditions Precedent to Making of Loans on the Initial Funding Date.........55
8.2 Conditions Precedent to Each Loan...........................................58
ARTICLE 9 DEFAULT; REMEDIES...................................................................59
9.1 Events of Default...........................................................59
9.2 Remedies....................................................................62
ARTICLE 10 TERM AND TERMINATION...............................................................63
10.1 Term and Termination........................................................63
ARTICLE 11 AMENDMENTS; WAIVERs; PARTICIPATIONS; ASSIGNMENTS; SUCCESSORS.......................64
11.1 Amendments and Waivers......................................................64
11.2 Assignments; Participations.................................................66
ARTICLE 12 THE AGENT..........................................................................68
12.1 Appointment and Authorization...............................................68
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12.2 Delegation of Duties........................................................69
12.3 Liability of the Agent......................................................69
12.4 Reliance by the Agent.......................................................69
12.5 Notice of Default...........................................................69
12.6 Credit Decision.............................................................70
12.7 Indemnification.............................................................70
12.8 The Agent in Individual Capacity............................................70
12.9 Successor Agent.............................................................71
12.10 Withholding Tax.............................................................71
12.11 Collateral Matters..........................................................72
12.12 Restrictions on Actions by Lenders; Sharing of Payments.....................74
12.13 Agency for Perfection.......................................................74
12.14 Payments by the Agent to Lenders............................................75
12.15 Settlement..................................................................75
12.16 Letters of Credit; Intra-Lender Issues......................................78
12.17 Concerning the Collateral and the Related Loan Documents....................81
12.18 Field Audit and Examination Reports; Disclaimer by Lenders..................81
12.19 Relation Among Lenders......................................................82
12.20 Co-Agents...................................................................82
12.21 Collateral Priority.........................................................82
ARTICLE 13 MISCELLANEOUS......................................................................82
13.1 No Waivers; Cumulative Remedies.............................................82
13.2 Severability................................................................83
13.3 Governing Law; Choice of Forum; Service of Process..........................83
13.4 WAIVER OF JURY TRIAL........................................................84
13.5 Survival of Representations and Warranties..................................84
13.6 Other Security and Guaranties...............................................84
13.7 Fees and Expenses...........................................................84
13.8 Notices.....................................................................85
13.9 Waiver of Notices...........................................................86
13.10 Binding Effect..............................................................86
13.11 Indemnity of the Agent and the Lenders by the Borrower......................87
13.12 Limitation of Liability.....................................................87
13.13 Final Agreement.............................................................88
13.14 Counterparts................................................................88
13.15 Captions....................................................................88
13.16 Right of Setoff.............................................................88
13.17 Confidentiality.............................................................89
13.18 Conflicts with Other Loan Documents.........................................89
13.19 Increases in Total Revolving Credit Commitment..............................90
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ANNEXES, EXHIBITS AND SCHEDULES
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ANNEX A - DEFINED TERMS
EXHIBIT A-1 - FORM OF REVOLVING LOAN NOTE
EXHIBIT A-2 - FORM OF TERM LOAN NOTE
EXHIBIT B - FORM OF BORROWING BASE CERTIFICATE
EXHIBIT C - FINANCIAL STATEMENTS
EXHIBIT D - FORM OF NOTICE OF BORROWING
EXHIBIT E - FORM OF NOTICE OF CONTINUATION/CONVERSION
EXHIBIT F - FORM OF ASSIGNMENT AND ACCEPTANCE AGREEMENT
SCHEDULE 1.2 - LENDERS' COMMITMENTS (ANNEX A - DEFINED TERMS)
SCHEDULE 1.3 - EXCLUDED RETAIL SUBSIDIARIES
SCHEDULE 1.4 - TERM LOAN COLLATERAL
SCHEDULE 6.3 - ORGANIZATION AND QUALIFICATIONS
SCHEDULE 6.4 - CORPORATE NAMES; PRIOR TRANSACTIONS
SCHEDULE 6.5 - SUBSIDIARIES AND AFFILIATES
SCHEDULE 6.7 - CAPITALIZATION
SCHEDULE 6.9 - DEBT
SCHEDULE 6.11 - REAL ESTATE; LEASES
SCHEDULE 6.12 - PROPRIETARY RIGHTS
SCHEDULE 6.13 - TRADE NAMES
SCHEDULE 6.14 - LITIGATION
SCHEDULE 6.15 - UNION CONTRACTS; LABOR DISPUTES
SCHEDULE 6.16 - ENVIRONMENTAL LAW
SCHEDULE 6.19 - ERISA COMPLIANCE
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SCHEDULE 6.26 - MATERIAL AGREEMENTS
SCHEDULE 6.27 - BANK ACCOUNTS
SCHEDULE 7.5(a) - REAL PROPERTY EXCLUDED FROM FLOOD INSURANCE REQUIREMENT
SCHEDULE 7.9 - ASSETS HELD FOR SALE; ADI LOCATIONS
SCHEDULE 7.12 - GUARANTIES
SCHEDULE 7.28 - ADDITIONAL MORTGAGES
SCHEDULE A - COLI POLICIES
SCHEDULE B - ELIGIBLE REAL ESTATE
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CREDIT AGREEMENT
This CREDIT AGREEMENT, dated as of July 27, 2001 (this
"AGREEMENT"), among the financial institutions from time to time parties hereto
(such financial institutions, together with their respective successors and
assigns, are referred to hereinafter each individually as a "LENDER" and
collectively as the "LENDERS"); BANK OF AMERICA, N.A., with an office at 55
South Lake Avenue, Suite 900, Pasadena, California 91101, as the administrative
agent for the Lenders (in its capacity as administrative agent, the "AGENT");
Citicorp USA, Inc., as the documentation agent (in its capacity as documentation
agent, the "DOCUMENTATION AGENT"); Heller Financial, Inc., as the syndication
agent (in its capacity as syndication agent, the "SYNDICATION AGENT"); FLEETWOOD
ENTERPRISES, INC., a Delaware corporation ("FLEETWOOD"), as a Guarantor;
FLEETWOOD HOLDINGS INC., a Delaware corporation ("HOLDINGS"); FLEETWOOD RETAIL
CORP., a Delaware corporation ("RETAIL"); and those Subsidiaries of Holdings and
Retail set forth on the signature pages hereto or which become parties hereto
hereafter in accordance with the requirements of this Agreement (each of
Holdings, Retail and each such Subsidiary individually, a "BORROWER" and,
collectively, the "BORROWERS"). Capitalized terms used in this Agreement and not
otherwise defined herein shall have the meanings ascribed thereto in ANNEX A,
which is attached hereto and incorporated herein; the rules of construction
contained therein shall govern the interpretation of this Agreement, and all
Annexes, Exhibits and Schedules attached hereto are incorporated herein by
reference.
W I T N E S S E T H:
WHEREAS, the Borrowers have requested the Lenders to make
available to the Borrowers a revolving line of credit for loans and letters of
credit in an aggregate amount not to exceed $230,000,000 and to make term loans
to FMC in the aggregate principal amount of $30,000,000, and which extensions of
credit the Borrowers will use for the purposes permitted hereunder;
WHEREAS, Holdings, Retail and their respective Subsidiaries
are wholly-owned Subsidiaries of Fleetwood and all Borrowers are engaged in an
inter-related business enterprise with an identity of interests, and accordingly
the financing provided hereunder will directly and indirectly benefit each of
the Borrowers;
WHEREAS, neither Holdings or its Subsidiaries nor Retail or
its Subsidiaries would be able to obtain sufficient working capital financing
for their respective businesses unless the individual FMC Borrowers and FRC
Borrowers were jointly and severally liable for the obligations of FMC or FRC,
as applicable, and unless Fleetwood guarantees the obligations of all Borrowers;
WHEREAS, FMC manufactures goods, a portion of which is sold to
FRC, and therefore the financing extended hereunder benefits both FMC and FRC;
WHEREAS, the Revolving Credit Lenders have agreed to make
available to the Borrowers a revolving credit facility and the Term Lenders have
agreed to make term loans to FMC upon the terms and conditions set forth in this
Agreement.
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NOW, THEREFORE, in consideration of the mutual conditions and
agreements set forth in this Agreement, and for good and valuable consideration,
the receipt of which is hereby acknowledged, the Lenders, the Agent, Fleetwood
and the Borrowers hereby agree as follows:
ARTICLE 1
LOANS AND LETTERS OF CREDIT
1.1 TOTAL FACILITY. Subject to all of the terms and conditions
of this Agreement, the Lenders agree to make available a total credit facility
of up to $260,000,000 (the "TOTAL FACILITY") to the Borrowers from time to time
during the term of this Agreement. The Total Facility shall be composed of a
revolving line of credit consisting of Revolving Loans and Letters of Credit and
the Term Loans described herein.
1.2 REVOLVING LOANS.
(a) (i) AMOUNTS. Subject to the satisfaction of the
conditions precedent set forth in ARTICLE 8, and except for
Non-Ratable Loans and Agent Advances, each Revolving Credit
Lender severally, but not jointly, agrees, upon a Borrower's
request from time to time on any Business Day during the
period from the Closing Date to the Termination Date, to make
revolving loans (the "REVOLVING LOANS") to the Borrowers in
aggregate amounts not to exceed such Lender's Pro Rata Share
of the Aggregate Availability, and, for Revolving Loans to
FMC, in an amount which does not exceed such Lender's Pro Rata
Share of FMC's Availability, or for Revolving Loans to FRC, in
an amount which does not exceed such Lender's Pro Rata Share
of FRC's Availability. The Revolving Credit Lenders, however,
in their unanimous discretion, may elect to make Revolving
Loans or issue or arrange to have issued Letters of Credit in
excess of the Aggregate Borrowing Bases or the Borrowing Base
of FMC or FRC, as applicable, on one or more occasions, but if
they do so, neither the Agent nor the Revolving Credit Lenders
shall be deemed thereby to have changed the limits of the
Borrowing Base of FMC or FRC, or the Aggregate Borrowing Bases
or to be obligated to exceed such limits on any other
occasion. If (x) the Aggregate Revolver Outstandings of FMC
would exceed its Availability after giving effect to any
Borrowing, or (y) the Aggregate Revolver Outstandings of FRC
would exceed its Availability after giving effect to any
Borrowing, the Revolving Credit Lenders may refuse to make or
may otherwise restrict the making of Revolving Loans to FMC or
FRC, as applicable, as the Revolving Credit Lenders determine
until such excess has been eliminated, subject to the Agent's
authority, in its sole discretion, to make Agent Advances
pursuant to the terms of SECTION 1.2(i).
(ii) At the request of any Revolving Credit
Lender, each of the FMC Borrowers and each of the FRC
Borrowers shall execute and deliver to such Lender a single
note to evidence the Revolving Loans of that Lender. Each note
shall be in the principal amount of the Revolving Credit
Lender's Pro Rata Share of the Revolving Loan Commitments,
dated the date hereof and substantially in the form of EXHIBIT
A-1 (each such note, together with any new note issued
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pursuant to SECTION 11.2 upon the assignment of any portion of
any Revolving Credit Lender's Revolving Loans and Revolving
Credit Commitment a "REVOLVING LOAN NOTE" and, collectively,
the "REVOLVING LOAN NOTES"). Each Revolving Loan Note shall
represent the obligation of each of FMC and FRC to pay the
amount of such Revolving Credit Lender's Pro Rata Share of the
Revolving Loan Commitments, or, if less, such Revolving Credit
Lender's Pro Rata Share of the aggregate unpaid principal
amount of all Revolving Loans to FMC or FRC, as applicable,
together with interest thereon as prescribed in SECTION 1.2.
The entire unpaid balance of the Revolving Loans and all other
non-contingent Obligations shall be immediately due and
payable in full in immediately available funds on the
Termination Date.
(b) PROCEDURE FOR BORROWING.
(i) Each Borrowing shall be made upon a
Borrower's irrevocable written notice delivered to the Agent
in the form of a notice of borrowing ("NOTICE OF BORROWING"),
which must be received by the Agent prior to (i) 10:00 a.m.
(Los Angeles time) three Business Days prior to the requested
Funding Date, in the case of LIBOR Rate Loans and (ii) 10:00
a.m. (Los Angeles time) on the requested Funding Date, in the
case of Base Rate Loans, specifying:
(1) the amount of the Borrowing,
which in the case of a LIBOR Rate Loan must equal or
exceed $1,000,000 (and increments of $500,000 in
excess of such amount);
(2) the requested Funding Date,
which must be a Business Day;
(3) whether the Revolving Loans
requested are to be Base Rate Revolving Loans or
LIBOR Rate Loans (and if not specified, it shall be
deemed a request for a Base Rate Revolving Loan); and
(4) the duration of the Interest
Period for LIBOR Rate Loans (and if not specified, it
shall be deemed a request for an Interest Period of
one month);
PROVIDED, HOWEVER, that with respect to the Borrowings to be
made on the Initial Funding Date, such Borrowings will consist
of Base Rate Revolving Loans only.
(ii) In lieu of delivering a Notice of Borrowing,
a Borrower may give the Agent telephonic notice of such
request for advances to its Designated Account on or before
the deadline set forth above. The Agent at all times shall be
entitled to rely on such telephonic notice in making such
Revolving Loans, regardless of whether any written
confirmation is received.
(iii) The Borrowers shall have no right to
request a LIBOR Rate Loan while a Default or Event of Default
has occurred and is continuing.
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(c) RELIANCE UPON AUTHORITY. Prior to the Closing
Date, the Borrowers shall deliver to the Agent a notice setting forth
the accounts of each of FMC and FRC (each, a "DESIGNATED ACCOUNT") to
which the Agent is authorized to transfer the proceeds of the Revolving
Loans requested hereunder by each of FMC and FRC. Any of FMC and FRC
may designate a replacement account from time to time by written
notice. All such Designated Accounts must be reasonably satisfactory to
the Agent. The Agent is entitled to rely conclusively on any person's
request for Revolving Loans on behalf of any Borrower, so long as the
proceeds thereof are to be transferred to the applicable Designated
Account. The Agent has no duty to verify the identity of any individual
representing himself or herself as a person authorized by any Borrower
to make such requests on its behalf.
(d) NO LIABILITY. The Agent shall not incur any
liability to the Borrowers as a result of acting upon any notice
referred to in SECTIONS 1.2(b) and (c), which the Agent believes in
good faith to have been given by an officer or other person duly
authorized by the applicable Borrower to request Revolving Loans on its
behalf. The crediting of Revolving Loans to the applicable Designated
Account conclusively establishes the obligation of the applicable
Borrowers to repay such Revolving Loans as provided herein.
(e) NOTICE IRREVOCABLE. Any Notice of Borrowing (or
telephonic notice in lieu thereof) made pursuant to SECTION 1.2(b)
shall be irrevocable. A Borrower shall be bound to borrow the funds
requested therein in accordance therewith.
(f) THE AGENT'S ELECTION. Promptly after receipt of a
Notice of Borrowing (or telephonic notice in lieu thereof), the Agent
shall elect to have the terms of SECTION 1.2(g) or the terms of SECTION
1.2(h) apply to such requested Borrowing. If the Bank declines in its
sole discretion to make a Non-Ratable Loan pursuant to SECTION 1.2(h),
the terms of SECTION 1.2(g) shall apply to the requested Borrowing.
(g) MAKING OF REVOLVING LOANS. If the Agent elects to
have the terms of this SECTION 1.2(g) apply to a requested Borrowing,
then promptly after receipt of a Notice of Borrowing or telephonic
notice in lieu thereof, the Agent shall notify the Revolving Credit
Lenders by telecopy, telephone or e-mail of the requested Borrowing.
Each Revolving Credit Lender shall transfer its Pro Rata Share of the
requested Borrowing to the Agent in immediately available funds, to the
account from time to time designated by the Agent, not later than 12:00
noon (Los Angeles time) on the applicable Funding Date. After the
Agent's receipt of all proceeds of such Revolving Loans, the Agent
shall make the proceeds of such Revolving Loans available to the
applicable Borrower on the applicable Funding Date by transferring same
day funds to the Designated Account of the applicable Borrower;
PROVIDED, HOWEVER, that the amount of Revolving Loans so made to FMC or
FRC on any date shall not exceed its Availability on such date, unless
all of the Revolving Credit Lenders otherwise agree.
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(h) MAKING OF NON-RATABLE LOANS.
(i) If the Agent elects, with the consent of the
Bank, to have the terms of this SECTION 1.2(h) apply to a
requested Borrowing, the Bank shall make a Revolving Loan in
the amount of that Borrowing available to the applicable
Borrower on the applicable Funding Date by transferring same
day funds to such Borrower's Designated Account. Each
Revolving Loan made solely by the Bank pursuant to this
Section is herein referred to as a "NON-RATABLE LOAN", and
such Revolving Loans are collectively referred to as the
"NON-RATABLE LOANS." Each Non-Ratable Loan shall be subject to
all the terms and conditions applicable to other Revolving
Loans except that all payments thereon shall be payable to the
Bank solely for its own account. The aggregate amount of
Non-Ratable Loans outstanding at any time shall not exceed
$10,000,000. The Agent shall not request the Bank to make any
Non-Ratable Loan if (1) the Agent has received written notice
from any Revolving Credit Lender that one or more of the
applicable conditions precedent set forth in ARTICLE 8 will
not be satisfied on the requested Funding Date for the
applicable Borrowing, and such conditions have not been waived
in accordance with this Agreement or (2) the requested
Borrowing by FMC or FRC would exceed its Availability on that
Funding Date.
(ii) The Non-Ratable Loans shall be secured by
the Agent's Liens in and to the Collateral and shall
constitute Base Rate Revolving Loans and Obligations
hereunder.
(i) THE AGENT ADVANCES.
(i) Subject to the limitations set forth
below, the Agent is authorized by the Borrowers and the
Revolving Credit Lenders, from time to time in the Agent's
sole discretion, (A) after the occurrence of a Default or an
Event of Default, or (B) at any time that any of the other
conditions precedent set forth in ARTICLE 8 have not been
satisfied, to make Base Rate Revolving Loans to the Borrowers
on behalf of the Revolving Credit Lenders in an aggregate
amount outstanding at any time not to exceed $10,000,000 which
the Agent, in its reasonable business judgment, deems
necessary or desirable (1) to preserve or protect the
Collateral, or any portion thereof, (2) to enhance the
likelihood of, or maximize the amount of, repayment of the
Loans and other Obligations, or (3) to pay any other amount
chargeable to the Borrowers pursuant to the terms of this
Agreement, including costs, fees and expenses as described in
SECTION 13.7 (any of such advances are herein referred to as
"AGENT ADVANCES"); PROVIDED, that (x) in no event shall the
Aggregate Revolver Outstandings at any time exceed the
aggregate Revolving Credit Commitments and (y) the Majority
Lenders may at any time revoke the Agent's authorization to
make Agent Advances. Any such revocation must be in writing
and shall become effective prospectively upon the Agent's
receipt thereof.
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(ii) Agent Advances shall be secured by the
Agent's Liens in and to the Collateral and shall constitute
Base Rate Revolving Loans and Obligations hereunder.
1.3 TERM LOANS.
(a) AMOUNTS OF TERM LOANS. Each Term Lender severally
agrees to make a term loan (any such term loan being referred to as a
"TERM LOAN" and such term loans being referred to collectively as the
"TERM LOANS") to FMC on the Initial Funding Date, upon the satisfaction
of the conditions precedent set forth in ARTICLE 8, in an amount equal
to such Lender's Pro Rata Share of $30,000,000. The Term Loans shall be
Base Rate Loans.
(b) MAKING OF TERM LOANS. Each Term Lender shall make
the amount of such Lender's Term Loan available to the Agent in same
day funds, to the Agent's designated account, not later than 12:00 noon
(Los Angeles time) on the Initial Funding Date. After the Agent's
receipt of the proceeds of such Term Loans, upon satisfaction of the
conditions precedent set forth in ARTICLE 8, the Agent shall make the
proceeds of such Term Loans available to FMC on such Funding Date by
transferring same day funds equal to the proceeds of such Term Loans
received by the Agent to FMC's Designated Account or as FMC shall
otherwise instruct in writing.
(c) TERM LOAN NOTES. FMC shall execute and deliver to
the Agent on behalf of each Term Lender, on the Closing Date, a
promissory note, substantially in the form of EXHIBIT A-2 attached
hereto and made a part hereof (such promissory notes, together with any
new notes issued pursuant to SECTION 11.2 upon the assignment of any
portion of any Term Lender's Term Loan, being hereinafter referred to
collectively as the "TERM LOAN NOTES" and each of such promissory notes
being hereinafter referred to individually as a "TERM LOAN NOTE"). The
Term Loan Notes shall evidence each Term Lender's Term Loan, in an
original principal amount equal to that Lender's Pro Rata Share of
$30,000,000 and with other appropriate insertions. Each Term Loan Note
shall be dated the Closing Date and shall mature on the second
Anniversary Date. Each payment shall be payable to the Agent for the
account of the applicable Term Lender. The Term Loans shall be payable
in full on the date on which this Agreement is terminated for any
reason. Payments or prepayments of the Term Loans may not be
reborrowed.
1.4 LETTERS OF CREDIT.
(a) AGREEMENT TO ISSUE OR CAUSE TO ISSUE. Subject to
the terms and conditions of this Agreement, the Agent agrees (i) to
cause the Letter of Credit Issuer to issue for the account of a
Borrower one or more commercial/documentary and standby letters of
credit ("LETTER OF CREDIT") and/or (ii) to provide credit support or
other enhancement to a Letter of Credit Issuer acceptable to the Agent,
which issues a Letter of Credit for the account of a Borrower (any such
credit support or enhancement being herein referred to as a "CREDIT
SUPPORT") from time to time during the term of this Agreement.
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(b) AMOUNTS; OUTSIDE EXPIRATION DATE. The Agent shall
not have any obligation to issue or cause to be issued any Letter of
Credit or to provide Credit Support for any Letter of Credit at any
time if: (i) the maximum face amount of the requested Letter of Credit
is greater than the Unused Letter of Credit Subfacility at such time;
(ii) the maximum undrawn amount of the requested Letter of Credit and
all commissions, fees, and charges due from the Borrowers in connection
with the opening thereof would exceed the Aggregate Availability at
such time; or, as to any Letter of Credit issued for the account of
FMC, would exceed the Availability of FMC at that time or, as to any
Letter of Credit issued for the account of FRC, would exceed the
Availability of FRC at that time, or (iii) such Letter of Credit has an
expiration date less than 30 days prior to the Stated Termination Date
or more than 12 months from the date of issuance for standby letters of
credit and 180 days for documentary letters of credit. With respect to
any Letter of Credit which contains any "evergreen" or automatic
renewal provision, each Lender shall be deemed to have consented to any
such extension or renewal unless any Revolving Credit Lender shall have
provided to the Agent written notice that it declines to consent to any
such extension or renewal at least thirty (30) days prior to the date
on which the Letter of Credit Issuer is entitled to decline to extend
or renew the Letter of Credit. If all of the requirements of this
SECTION 1.4 are met and no Default or Event of Default has occurred and
is continuing, no Lender shall decline to consent to any such extension
or renewal.
(c) OTHER CONDITIONS. In addition to conditions
precedent contained in ARTICLE 8, the obligation of the Agent to cause
to be issued any Letter of Credit or to provide Credit Support for any
Letter of Credit is subject to the following conditions precedent
having been satisfied in a manner reasonably satisfactory to the Agent:
(i) The applicable Borrower shall have
delivered to the Letter of Credit Issuer, at such times and in
such manner as such Letter of Credit Issuer may prescribe, an
application in form and substance satisfactory to such Letter
of Credit Issuer and reasonably satisfactory to the Agent for
the issuance of the Letter of Credit and such other documents
as may be required pursuant to the terms thereof, and the
form, terms and purpose of the proposed Letter of Credit shall
be reasonably satisfactory to the Agent and the Letter of
Credit Issuer; and
(ii) As of the date of issuance, no order of
any court, arbitrator or Governmental Authority shall purport
by its terms to enjoin or restrain money center banks
generally from issuing letters of credit of the type and in
the amount of the proposed Letter of Credit, and no law, rule
or regulation applicable to money center banks generally and
no request or directive (whether or not having the force of
law) from any Governmental Authority with jurisdiction over
money center banks generally shall prohibit, or request that
the proposed Letter of Credit Issuer refrain from, the
issuance of letters of credit generally or the issuance of
such Letters of Credit.
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(d) ISSUANCE OF LETTERS OF CREDIT.
(i) REQUEST FOR ISSUANCE. A Borrower must
notify the Agent of a requested Letter of Credit at least
three (3) Business Days prior to the proposed issuance date.
Such notice shall be irrevocable and must specify the original
face amount of the Letter of Credit requested, the Business
Day of issuance of such requested Letter of Credit, whether
such Letter of Credit may be drawn in a single or in partial
draws, the Business Day on which the requested Letter of
Credit is to expire, the purpose for which such Letter of
Credit is to be issued, and the beneficiary of the requested
Letter of Credit. The Borrower shall attach to such notice the
proposed form of the Letter of Credit.
(ii) RESPONSIBILITIES OF THE AGENT; ISSUANCE. As
of the Business Day immediately preceding the requested
issuance date of the Letter of Credit, the Agent shall
determine the amount of the applicable Unused Letter of Credit
Subfacility, the Availability of FMC or FRC, as applicable and
the Aggregate Availability. If (i) the face amount of the
requested Letter of Credit is less than the Unused Letter of
Credit Subfacility and (ii) the amount of such requested
Letter of Credit and all commissions, fees, and charges due
from the Borrower in connection with the opening thereof would
not exceed the Availability of FMC or FRC, as applicable, the
Agent shall cause the Letter of Credit Issuer to issue the
requested Letter of Credit on the requested issuance date so
long as the other conditions hereof are met.
(iii) NO EXTENSIONS OR AMENDMENT. The Agent
shall not be obligated to cause the Letter of Credit Issuer to
extend or amend any Letter of Credit issued pursuant hereto
unless the requirements of this SECTION 1.4 are met as though
a new Letter of Credit were being requested and issued.
(e) PAYMENTS PURSUANT TO LETTERS OF CREDIT. Each of
FMC or FRC, as applicable, agrees to reimburse immediately the Letter
of Credit Issuer for any draw under any Letter of Credit issued for its
benefit and the Agent for the account of the Revolving Credit Lenders
upon any payment pursuant to any Credit Support, and to pay the Letter
of Credit Issuer the amount of all other charges and fees payable to
the Letter of Credit Issuer in connection with any Letter of Credit
immediately when due, irrespective of any claim, setoff, defense or
other right which any Borrower may have at any time against the Letter
of Credit Issuer or any other Person. Each drawing under any Letter of
Credit shall constitute a request by the applicable Borrower to the
Agent for a Borrowing of a Base Rate Revolving Loan in the amount of
such drawing. The Funding Date with respect to such borrowing shall be
the date of such drawing.
(f) INDEMNIFICATION; EXONERATION; POWER OF ATTORNEY.
(i) INDEMNIFICATION. In addition to amounts
payable as elsewhere provided in this SECTION 1.4, each of
FMC, FRC and Fleetwood agrees to protect, indemnify, pay and
save the Lenders and the Agent harmless from and against any
and all claims, demands, liabilities, damages, losses, costs,
charges
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and expenses (including reasonable attorneys' fees) which any
Lender or the Agent (other than a Lender in its capacity as
Letter of Credit Issuer) may incur or be subject to as a
consequence, direct or indirect, of the issuance of any Letter
of Credit or the provision of any Credit Support or
enhancement in connection therewith. The Borrowers'
obligations under this Section shall survive payment of all
other Obligations.
(ii) ASSUMPTION OF RISK BY THE BORROWERS. As
among the Borrowers, the Lenders, and the Agent but subject to
subsection (iv) below, the Borrowers assume all risks of the
acts and omissions of, or misuse of any of the Letters of
Credit by, the respective beneficiaries of such Letters of
Credit. In furtherance and not in limitation of the foregoing,
subject to SUBSECTION (iv) below, the Lenders and the Agent
shall not be responsible for: (A) the form, validity,
sufficiency, accuracy, genuineness or legal effect of any
document submitted by any Person in connection with the
application for and issuance of and presentation of drafts
with respect to any of the Letters of Credit, even if it
should prove to be in any or all respects invalid,
insufficient, inaccurate, fraudulent or forged; (B) the
validity or sufficiency of any instrument transferring or
assigning or purporting to transfer or assign any Letter of
Credit or the rights or benefits thereunder or proceeds
thereof, in whole or in part, which may prove to be invalid or
ineffective for any reason; (C) the failure of the beneficiary
of any Letter of Credit to comply duly with conditions
required in order to draw upon such Letter of Credit; (D)
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; (E) errors in
interpretation of technical terms; (F) any loss or delay in
the transmission or otherwise of any document required in
order to make a drawing under any Letter of Credit or of the
proceeds thereof; (G) the misapplication by the beneficiary of
any Letter of Credit of the proceeds of any drawing under such
Letter of Credit; (H) any consequences arising from causes
beyond the control of the Lenders or the Agent, including any
act or omission, whether rightful or wrongful, of any present
or future DE JURE or DE FACTO Governmental Authority; or (I)
the Letter of Credit Issuer's honor of a draw for which the
draw or any certificate fails to comply in any respect with
the terms of the Letter of Credit. None of the foregoing shall
affect, impair or prevent the vesting of any rights or powers
of the Agent or any Lender under this SECTION 1.4(f).
(iii) EXONERATION. Without limiting the
foregoing, no action or omission whatsoever by the Agent or
any Lender with respect to any Letter of Credit issued
hereunder (excluding any Lender in its capacity as a Letter of
Credit Issuer) shall result in any liability of the Agent
and/or Lender to any Borrower, or relieve any Borrower of any
of its obligations hereunder to any such Person.
(iv) RIGHTS AGAINST LETTER OF CREDIT ISSUER.
Nothing contained in this Agreement is intended to limit a
Borrower's rights, if any, with respect to the Letter of
Credit Issuer which arise as a result of the letter of credit
application
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and related documents executed by and between such Borrower
and the Letter of Credit.
(v) ACCOUNT PARTY. Each Borrower hereby
authorizes and directs any Letter of Credit Issuer to name
such Borrower as the "Account Party" therein and to deliver to
the Agent all instruments, documents and other writings and
property received by the Letter of Credit Issuer pursuant to
the Letter of Credit, and to accept and rely upon the Agent's
instructions and agreements with respect to all matters
arising in connection with the Letter of Credit or the
application therefor.
(g) SUPPORTING LETTER OF CREDIT; CASH COLLATERAL. If,
notwithstanding the provisions of SECTION 1.4(b) and SECTION 10.1, any
Letter of Credit or Credit Support is outstanding upon the termination
of this Agreement, then upon such termination FMC or FRC as applicable,
shall deposit with the Agent, for the ratable benefit of the Agent and
the Revolving Credit Lenders, with respect to each Letter of Credit or
Credit Support then outstanding, cash ("CASH COLLATERAL") or a standby
letter of credit (a "SUPPORTING LETTER OF CREDIT") in form and
substance satisfactory to the Agent, issued by an issuer satisfactory
to the Agent, in each case in an amount equal to the greatest amount
for which such Letter of Credit or such Credit Support may be drawn
plus any fees and expenses associated with such Letter of Credit or
such Credit Support, under which Supporting Letter of Credit the Agent
is entitled to draw amounts necessary to reimburse the Agent and the
Revolving Credit Lenders for payments to be made by the Agent and the
Revolving Credit Lenders under such Letter of Credit or Credit Support
and any fees and expenses associated with such Letter of Credit or
Credit Support. Such Supporting Letter of Credit and/or Cash Collateral
shall be held by the Agent, for the ratable benefit of the Agent and
the Revolving Credit Lenders, as security for, and to provide for the
payment of, the aggregate undrawn amount of such Letters of Credit or
such Credit Support remaining outstanding.
1.5 BANK PRODUCTS. A Borrower may request and the Agent may,
in its sole and absolute discretion, arrange for a Borrower to obtain from the
Bank or the Bank's Affiliates Bank Products although no Borrower is required to
do so. If Bank Products so requested by a Borrower are provided by an Affiliate
of the Bank, each Borrower agrees to indemnify and hold the Agent, the Bank and
the Lenders harmless from any and all costs and obligations now or hereafter
incurred by the Agent, the Bank or any of the Lenders which arise from any
indemnity given by the Agent to its Affiliates related to such Bank Products;
PROVIDED, HOWEVER, nothing contained herein is intended to limit the Borrower's
rights, with respect to the Bank or its Affiliates, if any, which arise as a
result of the execution of documents by and between such Borrower and the Bank
which relate to Bank Products. The agreement contained in this Section shall
survive termination of this Agreement. Each Borrower acknowledges and agrees
that the obtaining of Bank Products from the Bank or the Bank's Affiliates (a)
is in the sole and absolute discretion of the Bank or the Bank's Affiliates,
and (b) is subject to all rules and regulations of the Bank or the Bank's
Affiliates.
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1.6 JOINT AND SEVERAL OBLIGATIONS; CONTRIBUTION RIGHTS.
(a) All Obligations of FMC shall be the joint and
several Obligations of the FMC Borrowers and all Obligations of FRC
shall be the joint and several Obligations of the FRC Borrowers,
regardless of which Borrower actually receives any Loans or other
extensions of credit under the Loan Documents, the amount received by
any Borrower or the manner in which any Borrower, the Agent or any
Lender accounts for such Loans and other extensions of credit.
(b) To the extent that any Borrower is a guarantor or
a surety as a result of the joint and several obligations hereunder,
such Obligations and the Liens securing such Obligations shall not be
released or impaired by any action or inaction on the part of the Agent
or any Lender which would otherwise constitute the release of a surety.
Without limiting the generality of the foregoing, the liability of any
Borrower under this Agreement shall not be affected or impaired in any
manner by, (i) the failure of any Person to become or remain a Borrower
or guarantor or the failure of the Agent or any Lender to preserve,
protect or enforce any right to require any Person to become or remain
a Borrower or guarantor, (ii) any taking, failure to take, failure to
create, perfect or ensure the priority of, or exchange, release or
termination or lapse of any Lien securing any Obligations, or any
taking, failure to take, release or amendment or waiver of or consent
to departure from any other guaranty of, any of the Obligations, (iii)
any manner or order of sale or other enforcement of any Lien securing
any of the Obligations or any manner or order of application of the
proceeds of any such Lien to the payment of the Obligations or any
failure to enforce any Lien or to apply any proceeds thereof, (iv) any
furnishing, exchange, substitution or release of any collateral
securing the Obligations, or any failure to perfect any Lien in any of
the collateral securing the Obligations, or (v) any other circumstance
which might otherwise constitute a defense (except the indefeasible
final payment in full) available to, or a discharge of, a surety or
guarantor.
(c) To the extent that any Borrower is a guarantor or
a surety as a result of the joint and several obligations hereunder,
the liability of each such Borrower under this Agreement shall remain
valid and enforceable and shall not be subject to any reduction,
limitation, impairment, discharge or termination for any reason (other
than indefeasible final payment in full of the Obligations), including
the occurrence of any of the following, whether or not such Borrower
shall have had notice or knowledge of any of them: (i) any failure or
omission to assert or enforce or agreement or election not to assert or
enforce, or the stay or enjoining, by order of court, by operation of
law or otherwise, of the exercise or enforcement of, any claim or
demand or any right, power or remedy (whether arising under the Loan
Documents, at law, in equity or otherwise) with respect to the
Obligations or any agreement relating thereto, or with respect to any
other guaranty of or security for the payment of the Obligations; (ii)
any rescission, waiver, amendment or modification of, or any consent to
departure from, any of the terms or provisions (including provisions
relating to Events of Default) of the Credit Agreement, any of the
other Loan Documents or any agreement or instrument executed pursuant
thereto, or of any other guaranty or security for the Obligations, in
each case whether or not in accordance with the terms of this
Agreement, such Loan Document or any agreement relating to such other
guaranty or security; (iii) the Obligations, or any
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agreement relating thereto, at any time being found to be illegal,
invalid or unenforceable in any respect; (iv) the application of
payments received from any source to the payment of any liability other
than the Obligations, even though the Lenders might have elected to
apply such payment to any part or all of the Obligations; (v) any
consent by any Lender or the Agent to the change, reorganization or
termination of the corporate structure or existence of any other
Borrower, or any other Person and to any corresponding restructuring of
the Obligations; (vi) any failure to perfect or continue perfection of
a security interest in any collateral which secures any of the
Obligations; (vii) any defenses (except the defense of indefeasible
final payment in full), set-offs or counterclaims which any Borrower,
any guarantor or any other Person may allege or assert against the
Agent or any Lender in respect of the Obligations, including, for
example, failure of consideration, breach of warranty, statute of
frauds, statute of limitations, accord and satisfaction and usury; and
(viii) any other act or thing or omission, or delay to do any other act
or thing, which may or might in any manner or to any extent vary the
risk of any Borrower as an obligor in respect of the Obligations.
(d) To the extent that any Borrower is a guarantor or
a surety as a result of the joint and several obligations hereunder, to
the maximum extent permitted by law, each such Borrower hereby waives
and agrees not to assert or take advantage of: (i) any defense now
existing or hereafter arising based upon any legal disability or other
defense of any other Borrower or any guarantor or other Person, or by
reason of the cessation or limitation of the liability of any other
Borrower or any guarantor or other Person from any cause other than
full payment and performance of all obligations due under this
Agreement or any of the other Loan Documents; (ii) any defense based
upon any lack of authority of the officers, directors, partners or
agents acting or purporting to act on behalf of any other Borrower or
any guarantor or other Person, or any defect in the formation of any
other Borrower or any guarantor or other Person; (iii) the
unenforceability or invalidity of any security or guaranty or the lack
of perfection or continuing perfection, or failure of priority of any
security for the Obligations; (iv) any and all rights and defenses
arising out of an election of remedies by the Agent or any Lender, even
though that election of remedies, such as a nonjudicial foreclosure
with respect to security for an Obligation, has destroyed such
Borrower's rights of subrogation and reimbursement against the
principal by the operation of Section 580d of the California Code of
Civil Procedure or otherwise; (v) any defense based upon any failure to
disclose to such Borrower any information concerning the financial
condition of any other Borrower or any guarantor or other Person or any
other circumstances bearing on the ability of any other Borrower or any
guarantor or other Person to pay and perform all obligations due under
this Agreement or any of the other Loan Documents; (vi) any failure by
the Agent or any Lender to give notice to any Borrower or any guarantor
or other Person of the sale or other disposition of security, and any
defect in notice given by the Agent or any Lender in connection with
any such sale or disposition of security; (vii) any failure of the
Agent or any Lender to comply with applicable laws in connection with
the sale or disposition of security, including, without limitation, any
failure by the Lender to conduct a commercially reasonable sale or
other disposition of such security; (viii) any defense based upon any
statute or rule of law which provides that the obligation of a surety
must be neither larger in amount nor in any other respects more
burdensome than that of a principal, or that reduces a surety's or
guarantor's obligations in proportion
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to the principal's obligation; (ix) any use of cash collateral under
Section 363 of the Bankruptcy Code; (x) any defense based upon an
election by the Agent or any Lender, in any proceeding instituted under
the Bankruptcy Code, of the application of Section 1111(b)(2) of the
Bankruptcy Code or any successor statute; (xi) any defense based upon
any borrowing or any grant of a security interest under Section 364 of
the Bankruptcy Code; (xii) any right of subrogation, any right to
enforce any remedy which the Agent or any Lender may have against any
other Borrower or any guarantor or other Person and any right to
participate in, or benefit from, any security now or hereafter held by
the Agent or any Lender for the Obligations; (xiii) presentment,
demand, protest and notice of any kind, including notice of acceptance
of this Agreement and of the existence, creation or incurring of new or
additional Obligations; (xiv) the benefit of any statute of limitations
affecting the liability of any other Borrower or any guarantor or other
Person, enforcement of this Agreement or any other Loan Documents, the
liability of any Borrower hereunder or the enforcement hereof; (xv) all
notices of intention to accelerate and/or notice of acceleration of the
Obligations; (xvi) relief from any applicable valuation or appraisement
laws; (xvii) any other action by the Agent or any Lender, whether
authorized by this Agreement or otherwise, or any omission by the Agent
or any Lender or other failure of the Agent or any Lender to pursue, or
delay in pursuing, any other remedy in its power; (xviii) any and all
claims and/or rights of counterclaim, recoupment, setoff or offset; and
(xix) any defense based upon the application of the proceeds of a Loan
for purposes other than the purposes represented by the Borrowers or
intended or understood by the Agent or any Lender or any Borrower. Each
Borrower agrees that the payment and performance of all Obligations or
any part thereof or other act which tolls any statute of limitations
applicable to this Agreement or the other Loan Documents shall
similarly operate to toll the statute of limitations applicable to such
Borrower's liability hereunder. Without limiting the generality of the
foregoing or any other provision hereof, each Borrower further waives
any and all rights and defenses that such Borrower may have because the
debt of the Borrowers is secured by real property of other Borrowers;
this means, among other things, that: (1) the Lenders may collect from
such Borrower without first foreclosing on any real or personal
property collateral pledged by any other Borrower, (2) if the Agent or
any Lender forecloses on any real property collateral pledged by any
other Borrower, then (A) the amount of the debt may be reduced only by
the price for which that collateral is sold at the foreclosure sale,
even if the collateral is worth more than the sale price, and (B) the
Agent or any Lender may collect from such Borrower even if the Agent or
any Lender, by foreclosing on the real property collateral, has
destroyed any right such Borrower may have to collect from any other
Borrower. The foregoing sentence is an unconditional and irrevocable
waiver of any rights and defenses each Borrower may have because the
Obligations are secured by real property of any other Borrower. Each
Borrower acknowledges and agrees that California Civil Code Section
2856 authorizes and validates waivers of a guarantor's rights of
subrogation and reimbursement and waivers of certain other rights and
defenses available to a guarantor under California law. Based on the
preceding sentence and without limiting the generality of the foregoing
waivers contained in this subparagraph or any other provision hereof,
each Borrower expressly waives to the extent permitted by law any and
all rights and defenses (except the defense of indefeasible final
payment in full), including without limitation any rights of
subrogation, reimbursement,
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indemnification and contribution (except contribution pursuant to this
Agreement), which might otherwise be available to such Borrower under
California Civil Code Sections 2787 to 2855, inclusive, 2899 and 3433
and under California Code of Civil Procedure Sections 580a, 580b, 580d
and 726 (or any of such sections), or any other jurisdiction to the
extent the same are applicable to this Agreement or the agreements,
covenants or obligations of any Borrower hereunder.
(e) Each Borrower is fully aware of the financial
condition of the FRC Borrowers or the FMC Borrowers, as applicable, and
is executing and delivering this Agreement based solely upon such
Borrower's own independent investigation of all matters pertinent
hereto and is not relying in any manner upon any representation or
statement by the Agent or any Lender. Each Borrower hereby assumes full
responsibility for obtaining any additional information concerning the
financial condition of the FRC Borrowers, the FMC Borrowers or any
other guarantor or their respective properties, financial condition and
prospects and any other matter pertinent hereto as such Borrower may
desire, and such Borrower is not relying upon or expecting the Agent or
any Lender to furnish to such Borrower any information now or hereafter
in the possession of the Agent or any Lender concerning the same or any
other matter. By executing this Agreement, each Borrower knowingly
accepts the full range of risks encompassed within a contract of this
type, which risks such Borrower acknowledges. No Borrower shall have
the right to require the Agent or any Lender to obtain or disclose any
information with respect to the Obligations, the financial condition or
prospects of any Borrower, the ability of any Borrower to pay or
perform the Obligations, the existence, perfection, priority or
enforceability of any collateral security for any or all of the
Obligations, the existence or enforceability of any other guaranties of
all or any part of the Obligations, any action or non-action on the
part of the Agent or any Lender, any Borrower or any other Person, or
any other event, occurrence, condition or circumstance whatsoever.
(f) To the extent that any Borrower is a guarantor or
a surety as a result of the joint and several obligations hereunder,
the Obligations of each such FMC Borrower and each such FRC Borrower
shall be limited in amount to an amount not to exceed the maximum
amount of such obligations and liabilities that can be made or assumed
by such Borrower without rendering such obligation or liability void or
voidable under applicable laws relating to fraudulent conveyance,
fraudulent transfer or similar laws affecting the rights of creditors
generally, in each case giving effect to all liabilities of such
Borrower other than any liabilities in respect of intercompany
indebtedness to the extent that it would be discharged in the amount
paid by such Borrower hereunder and giving effect to all rights of
subrogation, contribution, reimbursement, indemnity or similar rights
pursuant to applicable law or any agreement (the "MAXIMUM LIABILITY").
(g) (i) Each FMC Borrower hereby agrees that to the
extent that an FMC Borrower makes any payment on behalf of
FMC, such FMC Borrower shall be entitled to seek and receive
contribution and indemnification from and to be reimbursed by
each other FMC Borrower in an amount equal to a fraction of
such payment, the numerator of which is the Maximum Liability
of the FMC Borrower making the payment and the denominator of
which is the Maximum Liability of all FMC Borrowers as of the
date of determination. Each FMC
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Borrower's right of contribution shall be subject to the terms
and conditions of SECTION 1.6(h). The provisions of this
SECTION 1.6(g)(i) shall in no respect limit the obligations
and liabilities of any FMC Borrower to the Lenders and each
FMC Borrower shall remain liable to the Lenders for the full
amount of its liabilities hereunder.
(ii) Each FRC Borrower hereby agrees that to
the extent that an FRC Borrower makes any payment on behalf of
FRC, such FRC Borrower shall be entitled to seek and receive
contribution and indemnification from and to be reimbursed by
each other FRC Borrower in an amount equal to a fraction of
such payment, the numerator of which is the Maximum Liability
of the FRC Borrower making the payment and the denominator of
which is the Maximum Liability of all FRC Borrowers as of the
date of determination. Each FRC Borrower's right of
contribution shall be subject to the terms and conditions of
SECTION 1.6(h). The provisions of this SECTION 1.6(g)(ii)
shall in no respect limit the obligations and liabilities of
any FRC Borrower to the Lenders and each FRC Borrower shall
remain liable to the Lenders for the full amount of its
liabilities hereunder.
(h) No FMC Borrower or FRC Borrower shall be entitled
to be subrogated to any of the rights of the Agent or any Lender
against or any other FMC Borrower or FRC Borrower or any collateral
security or guarantee or right to offset held by the Agent or any
Lender for the payment of the Obligations of FMC or FRC, as the case
may be, nor shall any FMC Borrower or FRC Borrower seek or be entitled
to seek any contribution or reimbursement from or any other FMC
Borrower or FRC Borrower in respect of payments made by such Borrower
hereunder, until all amounts owing to the Agent or any Lender on
account of the Obligations of FMC or FRC, as the case may be, are paid
in full, no Letter of Credit shall be outstanding and the Commitments
are terminated or have expired. If any amount shall be paid to any FMC
Borrower or FRC Borrower on account of such subrogation rights at any
time not permitted hereunder, such amount shall be held by such
Borrower in trust for the Agent and the Lenders, segregated from other
funds of such Borrower, and shall, forthwith upon receipt, be turned
over to the Agent in the exact form received (duly endorsed to the
Agent, if required), to be applied against the Obligations, whether
matured or unmatured, in such order as the Agent may determine.
1.7 BORROWING AGENCY PROVISIONS.
(a) At the request of, and solely as an accommodation
to, Borrowers, the Lenders have agreed to make the Loans to, and to
issue Letters of Credit for the FMC Borrowers and the FRC Borrowers on
a joint and several basis as co-borrowers. In order to facilitate the
co-borrowing arrangement, each FMC Borrower hereby irrevocably
designates Holdings to be its agent and attorney-in-fact for purposes
of the Loan Documents, and each FRC Borrower hereby irrevocably
designates Retail to be its agent and attorney-in-fact for purposes of
the Loan Documents, and each of them hereby irrevocably authorizes such
agent in such capacity to take such actions on behalf of the applicable
FMC Borrower or FRC Borrower, as the case may be, and to exercise such
powers under this Agreement and the other Loan Documents on such
Borrower's behalf
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as may otherwise be exercised by such Borrower, together with such
powers as are incidental thereto, including without limitation to
borrow Loans, to execute and deliver Notices of Borrowing, Notices of
Conversion/Continuation, requests for Letters of Credit, Borrowing Base
Certificates and such other documents, instruments and certificates
required by the Loan Documents in connection with any Borrowing or
repayment of the Loans, to borrow, repay, reborrow, convert and
continue Loans and to receive proceeds of Loans and to give all other
notices and consents hereunder. Each Borrower further irrevocably
authorizes the Agent to act on all such documents, instruments and
certificates delivered by such agents and attorneys-in-fact, and to
pay over and credit the proceeds of any Loans so requested to the
Designated Account of FMC or FRC, as applicable. Each of Holdings and
Retail hereby accepts the appointment to act as agent and attorney in
fact for the FMC Borrowers and the FRC Borrowers, as the case may be.
The Agent and each Lender shall be entitled to rely absolutely on the
appointment and authorization of Holdings to act on behalf of the FMC
Borrowers and of Retail to act on behalf of the FRC Borrowers with
respect to all matters relating to this Agreement and the other Loan
Documents, whether or not any provision of this Agreement or any other
Loan Documents specifically provides that action may or shall be taken
by Holdings or Retail on behalf of the FMC Borrowers or the FRC
Borrowers. The Agent and the Lenders may give all notices to any FMC
Borrower to Holdings and to any FRC Borrower to Retail. Each Borrower
agrees that each notice, election, representation and warranty,
covenant, agreement and undertaking made on its behalf by Holdings or
Retail, as the case may be, shall be deemed for all purposes to have
been made by such Borrower and shall be binding upon and enforceable
against such Borrower to the same extent as if the same had been made
directly by such Borrower.
(b) All Borrowers acknowledge and agree that the
Borrowers are engaged in an integrated operation that requires
financing on the basis of credit availability to each Borrower, that
the co-borrowing arrangement has been established at the request of the
Borrowers, and that each Borrower expects to derive, directly or
indirectly, benefit from such credit availability to the other
Borrowers. Neither the Agent nor the Letter of Credit Issuer nor any
Lender shall incur any liability to Borrowers or any other Loan Party
as a result of the co-borrowing arrangement established by this
Agreement and shall not have any liability or responsibility to the
Borrowers to inquire into the allocation, apportionment or use of the
proceeds of any Loans or extensions of credit hereunder. To induce the
Agent, the Letter of Credit Issuer and the Lenders to establish this
co-borrowing arrangement and in consideration thereof, each Borrower
hereby indemnifies the Agent, the Letter of Credit Issuer and the
Lenders, and their respective successors and assigns, and agrees to
hold each of them harmless from any and all liabilities, expenses,
losses, damages and claims asserted against them by any Person arising
from or incurred by reason of the handling of the financing
arrangements of the Borrowers as provided in this Agreement, any
reliance by the Agent, the Letter of Credit Issuer or any Lender on any
document, request or instruction given by the agents designated by the
FMC Borrowers and the FRC Borrowers herein to act on their behalf or
any other action taken by the Agent, the Letter of Credit Issuer or the
Lenders with respect to the co-borrowing arrangement; PROVIDED,
HOWEVER, that no Borrower shall have an obligation to indemnify any of
the Agent, the Letter of Credit Issuer or any Lender under this SECTION
1.7 with respect to any liabilities finally determined by a court of
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competent jurisdiction to have resulted primarily from the gross
negligence or willful misconduct of such indemnified party. The
agreements of the Borrowers contained in this SECTION 1.7 shall survive
payment of all other Obligations.
1.8 SENIOR DEBT. All Obligations of Fleetwood under this
Agreement and the other Loan Documents, and all rights of contribution,
indemnity, subrogation and reimbursement relating to the Obligations of any Loan
Party with respect to Fleetwood, are "Senior Debt" under the Subordinated
Debentures and Fleetwood's guaranty of the Trust Securities.
ARTICLE 2
INTEREST AND FEES
2.1 INTEREST.
(a) INTEREST RATES. All outstanding Obligations shall
bear interest on the unpaid principal amount thereof (including, to the
extent permitted by law, on interest thereon not paid when due) from
the date made until paid in full in cash at a rate determined by
reference to the Base Rate or the LIBOR Rate plus the Applicable
Margin, but not to exceed the Maximum Rate. The Term Loans shall be
Base Rate Loans. If at any time Loans are outstanding with respect to
which a Borrower has not delivered to the Agent a notice specifying the
basis for determining the interest rate applicable thereto in
accordance herewith, those Loans shall bear interest at a rate
determined by reference to the Base Rate until notice to the contrary
has been given to the Agent in accordance with this Agreement and such
notice has become effective.
Each change in the Base Rate shall be reflected in the interest rate
applicable to Base Rate Loans as of the effective date of such change.
All interest charges shall be computed on the basis of a year of 360
days and actual days elapsed (which results in more interest being paid
than if computed on the basis of a 365-day year). The applicable
Borrowers shall pay to the Agent, for the ratable benefit of the
Revolving Credit Lenders or the Term Lenders, as the case may be,
interest accrued on all Loans in arrears on the first day of each month
hereafter and on the Termination Date.
(b) DEFAULT RATE. If any Default or Event of Default
occurs and is continuing and the Agent or the Majority Lenders in their
discretion so elect, then, from the date of the occurrence of any such
Default or Event of Default and so long as such Default or Event of
Default is continuing, all of the Obligations shall bear interest at
the Default Rate applicable thereto; provided that from the date of the
occurrence of an Event of Default under SECTION 9.1(a) with respect to
any Term Loan Obligation, the Term Loan Obligations shall automatically
bear interest at the Default Rate applicable thereto.
2.2 CONTINUATION AND CONVERSION ELECTIONS.
(a) FMC or FRC may:
(i) elect, as of any Business Day, in the
case of Base Rate Revolving Loans to convert any such Base
Rate Revolving Loans (or any part
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thereof in an amount not less than $1,000,000, or that is in
an integral multiple of $500,000 in excess thereof) into LIBOR
Rate Loans; or
(ii) elect, as of the last day of the
applicable Interest Period, to continue any LIBOR Rate Loans
having Interest Periods expiring on such day (or any part
thereof in an amount not less than $1,000,000, or that is in
an integral multiple of $500,000 in excess thereof);
PROVIDED, that if at any time the aggregate amount of LIBOR Rate Loans
in respect of any Borrowing is reduced, by payment, prepayment, or
conversion of part thereof to be less than $1,000,000, such LIBOR Rate
Loans shall automatically convert into Base Rate Loans; PROVIDED
FURTHER that if the notice shall fail to specify the duration of the
Interest Period, such Interest Period shall be one month.
(b) FMC or FRC shall deliver a notice of
continuation/conversion ("NOTICE OF CONTINUATION/CONVERSION") to the
Agent not later than 10:00 a.m. (Los Angeles time) at least three (3)
Business Days in advance of the Continuation/Conversion Date, if the
Loans are to be converted into or continued as LIBOR Rate Loans and
specifying:
(i) the proposed Continuation/Conversion Date;
(ii) the aggregate amount of Loans to be converted
or renewed;
(iii) the type of Loans resulting from the proposed
conversion or continuation; and
(iv) the duration of the requested Interest
Period, PROVIDED, HOWEVER, the Borrowers may not select an
Interest Period that ends after the Stated Termination Date.
(c) If upon the expiration of any Interest Period
applicable to LIBOR Rate Loans, FMC or FRC, as the case may be, has
failed to select timely a new Interest Period to be applicable to LIBOR
Rate Loans or if any Default or Event of Default then exists, the
applicable Borrower(s) shall be deemed to have elected to convert such
LIBOR Rate Loans into Base Rate Loans effective as of the expiration
date of such Interest Period.
(d) The Agent will promptly notify each Lender of its
receipt of a Notice of Continuation/Conversion. All conversions and
continuations shall be made ratably according to the respective
outstanding principal amounts of the Loans with respect to which the
notice was given held by each Lender.
(e) There may not be more than seven (7) different
LIBOR Rate Loans in effect hereunder at any time.
2.3 MAXIMUM INTEREST RATE. In no event shall any interest
rate provided for hereunder exceed the maximum rate legally chargeable by any
Lender under applicable law for
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such Lender with respect to loans of the type provided for hereunder (the
"MAXIMUM RATE"). If, in any month, any interest rate, absent such limitation,
would have exceeded the Maximum Rate, then the interest rate for that month
shall be the Maximum Rate, and, if in future months, that interest rate would
otherwise be less than the Maximum Rate, then that interest rate shall remain at
the Maximum Rate until such time as the amount of interest paid hereunder equals
the amount of interest which would have been paid if the same had not been
limited by the Maximum Rate. In the event that, upon payment in full of the
Obligations, the total amount of interest paid or accrued under the terms of
this Agreement is less than the total amount of interest which would, but for
this SECTION 2.3, have been paid or accrued if the interest rate otherwise set
forth in this Agreement had at all times been in effect, then the Borrowers
shall, to the extent permitted by applicable law, pay the Agent, for the account
of the Lenders, an amount equal to the excess of (a) the lesser of (i) the
amount of interest which would have been charged if the Maximum Rate had, at all
times, been in effect or (ii) the amount of interest which would have accrued
had the interest rate otherwise set forth in this Agreement, at all times, been
in effect over (b) the amount of interest actually paid or accrued under this
Agreement. If a court of competent jurisdiction determines that the Agent and/or
any Lender has received interest and other charges hereunder in excess of the
Maximum Rate, such excess shall be deemed received on account of, and shall
automatically be applied to reduce, the Obligations other than interest, in the
inverse order of maturity, and if there are no Obligations outstanding, the
Agent and/or such Lender shall refund to the applicable Borrower(s) such excess.
2.4 CLOSING FEE. The Borrowers, jointly and severally, agree
to pay the Agent on the Closing Date a closing fee (the "CLOSING FEE") as set
forth in the Fee Letter.
2.5 UNUSED LINE FEE. On the first day of each month and on the
Termination Date the Borrowers, jointly and severally, agree to pay to the
Agent, for the account of the Revolving Credit Lenders, in accordance with their
respective Pro Rata Shares, an unused line fee (the "UNUSED LINE FEE") equal to
percentage per annum set forth in the definition of Applicable Margin times the
amount by which the Maximum Revolver Amount exceeded the sum of the average
daily outstanding amount of Revolving Loans and the average daily undrawn face
amount of outstanding Letters of Credit, during the immediately preceding month
or shorter period if calculated for the first month hereafter or on the
Termination Date. The Unused Line Fee shall be computed on the basis of a
360-day year for the actual number of days elapsed. All principal payments
received by the Agent shall be deemed to be credited to the applicable
Borrowers' Loan Account immediately upon receipt for purposes of calculating the
Unused Line Fee pursuant to this SECTION 2.5.
2.6 LETTER OF CREDIT FEE. FMC or FRC, as applicable, agree to
pay to the Agent, for the account of the Revolving Credit Lenders, in accordance
with their respective Pro Rata Shares, for each Letter of Credit, a fee (the
"LETTER OF CREDIT FEE") equal to the percentage per annum set forth in the
definition of Applicable Margin times the undrawn face amount of each Letter of
Credit and to the Agent for the benefit of the Letter of Credit Issuer a
fronting fee of one-eighth of one percent (0.125%) per annum of the undrawn face
amount of each Letter of Credit, and to the Letter of Credit Issuer, all
out-of-pocket costs, fees and expenses incurred by the Letter of Credit Issuer
in connection with the application for, processing of, issuance of, or amendment
to any Letter of Credit. The Letter of Credit Fee shall be payable monthly in
arrears on the first day of each month following any month in which a Letter of
Credit is outstanding
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and on the Termination Date. The Letter of Credit Fee shall be computed on the
basis of a 360-day year for the actual number of days elapsed.
ARTICLE 3
PAYMENTS AND PREPAYMENTS
3.1 REVOLVING LOANS. FMC or FRC shall repay the outstanding
principal balance of the Revolving Loans made to it, plus all accrued but unpaid
interest thereon, on the Termination Date. A Borrower may prepay Revolving Loans
at any time, and reborrow subject to the terms of this Agreement. In addition,
and without limiting the generality of the foregoing, upon demand FMC or FRC, as
applicable, shall pay to the Agent, for account of the Revolving Credit Lenders,
the amount, without duplication, by which its Aggregate Revolver Outstandings
exceeds the lesser of its Borrowing Base or the Maximum Revolver Amount.
3.2 TERMINATION OF FACILITY. The Borrowers may terminate this
Agreement upon at least thirty days' notice to the Agent and the Lenders, upon
(a) the payment in full of all outstanding Revolving Loans, together with
accrued interest thereon, and the cancellation and return of all outstanding
Letters of Credit (or the provision of Cash Collateral or a Supporting Letter of
Credit in accordance with SECTION 1.4(g) above), (b) the prepayment in full of
the Term Loans, together with accrued and unpaid interest thereon, (c) the
payment of the early termination fee set forth below, (d) the payment in full in
cash of all reimbursable expenses and other Obligations, and (e) with respect to
any LIBOR Rate Loans prepaid, payment of the amounts due under SECTION 4.4, if
any. If this Agreement is terminated prior to the first anniversary of the
Closing Date, whether pursuant to this SECTION 3.2 or pursuant to SECTION 9.2,
Borrowers shall pay to the Agent, for the accounts of the Lenders, in proportion
to their respective Pro Rata Shares, an early termination fee equal to two
percent (2%) of the Total Facility. No early termination fee shall be payable if
this Agreement is terminated after the first anniversary of the Closing Date.
3.3 REPAYMENT OF THE TERM LOANS.
(a) AMORTIZATION OF TERM LOAN.
(i) On the first day of each calendar month,
commencing with the first day of the first calendar month
after the first Anniversary Date, FMC agrees to repay the
principal amount of Term Loans in an amount equal to
$1,000,000.
(ii) On the second Anniversary Date, FMC
agrees to repay the outstanding principal amount of and all
accrued and unpaid interest on the Term Loans.
(b) TERM LENDERS. FMC agrees to repay the principal
of the Term Loans to the Agent, for the account of the Lenders as set
forth in SECTION 1.3.
(c) APPLICATION OF PREPAYMENTS. Any prepayments to
Term Loan hereunder shall be applied FIRST, to the repayments of Term
Loans required pursuant to
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SECTION 3.3(a)(ii), and SECOND, to the repayments of Term Loans
required pursuant to SECTION 3.3(a)(i) in inverse order of maturity.
3.4 PREPAYMENTS OF THE LOANS.
(a) FMC may prepay the principal of the Term Loans in
whole or in part, at any time and from time to time upon at least 5
Business Days' prior written notice to the Agent and the Term Lenders.
All voluntary prepayments of the principal of the Term Loans shall be
accompanied by the payment of all accrued but unpaid interest on the
Term Loans to the date of prepayment. Amounts prepaid in respect of the
Term Loans may not be reborrowed.
(b) Immediately upon receipt by any Loan Party of
proceeds of any disposition of Eligible Equipment or Eligible Real
Estate, FMC shall repay the Revolving Loans in an amount equal to the
amount advanced against the applicable asset in calculation of the
Borrowing Base, and the Maximum PP&E Loan Amount shall be permanently
reduced by such amount.
(c) Subject to the terms of SECTION 7.9 permitting
certain reinvestment of asset disposition proceeds, immediately upon
any receipt by any Loan Party of proceeds of any disposition of any
Term Loan Collateral, FMC shall repay the Term Loans in an amount equal
to all such proceeds, net of (A) commissions and other customary
transaction costs, fees and expenses properly attributable to such
transaction and payable by a Loan Party in connection therewith (other
than any amounts payable to any Affiliate), (B) transfer taxes, (C)
amounts payable to holders of senior Liens (to the extent that such
Liens are Permitted Liens), if any, (D) an appropriate reserve for
income taxes in accordance with GAAP in connection therewith; and (E)
with respect to any sale of all of the Capital Stock of the Identified
Subsidiary an amount equal the amount advanced against the Eligible
Accounts and Eligible Inventory of the Identified Subsidiary (the "NET
PROCEEDS"). After the Term Loans have been repaid in full, any
remaining Net Proceeds shall be applied to the Revolving Loans, but
without reduction of the Revolving Credit Commitments.
(d) Immediately upon any receipt by any Loan Party of
proceeds of any assets (other than (i) Inventory sold in the ordinary
course of business and (ii) assets described in SUBSECTIONS (b) or (c)
above), the Borrowers shall repay the Revolving Loans in an amount
equal to the Net Proceeds, but without reduction of the Revolving
Credit Commitments.
(e) Concurrently with an FRC Borrower Release, the
Borrowers shall repay the Revolving Loans in an amount equal the amount
advanced against the Eligible Accounts, Eligible Inventory and Eligible
Equipment of the FRC Borrower being released in such FRC Borrower
Release, but without reduction of the Revolving Credit Commitments.
(f) Concurrently with the sale of the Capital Stock
of the Identified Subsidiary, the Borrowers shall repay the Revolving
Loans in an amount equal to the
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amount advanced against the Eligible Accounts and Eligible Inventory of
the Identified Subsidiary, but without reduction of the Revolving
Credit Commitments.
(g) No provision contained in this SECTION 3.4 shall
constitute a consent to an asset disposition that is otherwise not
permitted by the terms of this Agreement.
3.5 LIBOR RATE LOAN PREPAYMENTS. In connection with any
prepayment, if any LIBOR Rate Loans are prepaid prior to the expiration date of
the Interest Period applicable thereto, the applicable Borrower shall pay to the
Revolving Credit Lenders the amounts described in SECTION 4.4.
3.6 PAYMENTS BY THE BORROWERS.
(a) All payments to be made by the Borrowers shall be
made without set-off, recoupment or counterclaim. Except as otherwise
expressly provided herein, all payments by the Borrowers shall be made
to the Agent for the account of the Revolving Credit Lenders or Term
Lenders, as applicable, at the account designated by the Agent and
shall be made in Dollars and in immediately available funds, no later
than 12:00 noon (Los Angeles time) on the date specified herein. Any
payment received by the Agent after such time shall be deemed (for
purposes of calculating interest only) to have been received on the
following Business Day and any applicable interest shall continue to
accrue.
(b) Subject to the provisions set forth in the
definition of "INTEREST PERIOD", whenever any payment is due on a day
other than a Business Day, such payment shall be due on the following
Business Day, and such extension of time shall in such case be included
in the computation of interest or fees, as the case may be.
3.7 PAYMENTS AS REVOLVING LOANS. At the election of the Agent,
all payments of principal of or interest on the Revolving Loans, reimbursement
obligations in connection with Letters of Credit and Credit Support for Letters
of Credit, fees, premiums, reimbursable expenses and other sums payable
hereunder (other than the Term Loans), may be paid from the proceeds of
Revolving Loans made hereunder. Proceeds of Revolving Loans may be used to make
payments of the Term Loan Obligations only if: (a) for payments of the Term Loan
Obligations under SECTION 3.3(a)(i), no Event of Default has occurred and is
continuing, and (b) for payments of Term Loan Obligations under SECTION
3.3(a)(ii), (x) no Event of Default has occurred and is continuing, (y) the
amount of the average of the Liquidity for each of the most recent three
calendar months is at least $60,000,000 and (z) on the date of any such payment
of the Term Loan Obligations, after giving effect to any Borrowing, the
Aggregate Availability PLUS the Qualified Cash Equivalents is equal to or
greater than $10,000,000 plus the amount, on such date, of the required minimum
Aggregate Availability under SECTION 7.25. Each Borrower hereby irrevocably
authorizes the Agent to charge the applicable Loan Account for the purpose of
paying all amounts from time to time due from FMC and FRC or any FMC Borrower or
FRC Borrower and agrees that all such amounts charged shall constitute Revolving
Loans (including Non-Ratable Loans and Agent Advances).
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3.8 APPORTIONMENT, APPLICATION AND REVERSAL OF PAYMENTS.
Principal and interest payments shall be apportioned ratably among the Lenders
(according to the unpaid principal balance of the Loans to which such payments
relate held by each Lender). All payments shall be remitted to the Agent and all
such payments not relating to principal or interest of specific Loans, or not
constituting payment of specific fees, and all proceeds of Accounts, or, except
as set forth below with respect to Term Loan Collateral, other Collateral
received by the Agent, shall be applied, ratably, subject to the provisions of
this Agreement, FIRST, to pay any fees, indemnities, or expense reimbursements
(other than amounts related to Bank Products) then due to the Agent or the
Lenders from the applicable Borrower; SECOND, to pay interest due from such
Borrower in respect of all Loans, including Non-Ratable Loans and Agent
Advances; THIRD, to pay or prepay principal of the Non-Ratable Loans and Agent
Advances owed by such Borrower; FOURTH, to pay or prepay principal of the
Revolving Loans (other than Non-Ratable Loans and Agent Advances) and unpaid
reimbursement obligations in respect of Letters of Credit; FIFTH, to pay an
amount to the Agent equal to all outstanding Letter of Credit Obligations of
such Borrower to be held as cash collateral for such Obligations; SIXTH, to pay
or prepay principal of the Term Loans owed by such Borrower; SEVENTH, to the
payment of any other Obligation (other than amounts related to Bank Products)
due to the Agent or any Lender by such Borrower and EIGHTH, to pay any fees,
indemnities or expense reimbursements related to Bank Products due to the Agent
from the applicable Borrower. Notwithstanding the foregoing, until the Term
Loans have been paid in full, proceeds of the Term Loan Collateral shall be
applied FIRST to pay any fees, indemnities or expense reimbursements relating to
the Term Loans or the Term Loan Collateral then due to the Agent or the Lenders
from FMC; SECOND, to pay interest due from FMC in respect to the Term Loans;
THIRD, to pay or prepay principal of the Term Loans; and FOURTH, to all other
Obligations in accordance with the preceding sentence. Notwithstanding anything
to the contrary contained in this Agreement, unless so directed by the
applicable Borrower, or unless an Event of Default has occurred and is
continuing, neither the Agent nor any Lender shall apply any payments which it
receives to any LIBOR Rate Loan, except (a) on the expiration date of the
Interest Period applicable to any such LIBOR Rate Loan, or (b) in the event, and
only to the extent, that there are no outstanding Base Rate Loans and, in any
event, the applicable Borrower shall pay LIBOR breakage losses in accordance
with SECTION 4.4. The Agent and the Lenders shall have the continuing and
exclusive right to apply and reverse and reapply any and all such proceeds and
payments to any portion of the Obligations.
3.9 INDEMNITY FOR RETURNED PAYMENTS. If after receipt of any
payment which is applied to the payment of all or any part of the Obligations,
the Agent, any Lender, the Bank or any Affiliate of the Bank is for any reason
compelled to surrender such payment or proceeds to any Person because such
payment or application of proceeds is invalidated, declared fraudulent, set
aside, determined to be void or voidable as a preference, impermissible setoff,
or a diversion of trust funds, or for any other reason, then the Obligations or
part thereof intended to be satisfied shall be revived and continued and this
Agreement shall continue in full force as if such payment or proceeds had not
been received by the Agent, such Lender, the Bank or any Affiliate of the Bank
and the Borrowers shall be liable to pay to the Agent and the Lenders, and
hereby indemnify the Agent and the Lenders and hold the Agent and the Lenders
harmless for the amount of such payment or proceeds surrendered. The provisions
of this SECTION 3.9 shall be and remain effective notwithstanding any contrary
action which may have been taken by the Agent or any Lender, the Bank or any
Affiliate of the Bank in reliance upon such payment or application of proceeds,
and any such contrary action so taken shall be without prejudice to the
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Agent's and the Lenders' rights under this Agreement and shall be deemed to have
been conditioned upon such payment or application of proceeds having become
final and irrevocable. The provisions of this SECTION 3.9 shall survive the
termination of this Agreement.
3.10 THE AGENT'S AND LENDERS' BOOKS AND RECORDS; MONTHLY
STATEMENTS. The Agent shall record the principal amount of the Loans owing to
each Lender, the undrawn face amount of all outstanding Letters of Credit and
the aggregate amount of unpaid reimbursement obligations outstanding with
respect to the Letters of Credit from time to time on its books. In addition,
each Lender may note the date and amount of each payment or prepayment of
principal of such Lender's Loans in its books and records. Failure by the Agent
or any Lender to make such notation shall not affect the obligations of the
applicable Borrower with respect to the Loans or the Letters of Credit. Each
Borrower agrees that the Agent's and each Lender's books and records showing the
Obligations and the transactions pursuant to this Agreement and the other Loan
Documents shall be admissible in any action or proceeding arising therefrom, and
shall constitute rebuttably presumptive proof thereof, irrespective of whether
any Obligation is also evidenced by a promissory note or other instrument. The
Agent will provide to the Borrowers a monthly statement of Loans, payments, and
other transactions pursuant to this Agreement. Such statement shall be deemed
correct, accurate, and binding on the Borrowers and an account stated (except
for reversals and reapplications of payments made as provided in SECTION 3.8 and
corrections of errors discovered by the Agent), unless the Borrowers notify the
Agent in writing to the contrary within thirty (30) days after such statement is
rendered. In the event a timely written notice of objections is given by the
Borrowers, only the items to which exception is expressly made will be
considered to be disputed by the Borrowers.
3.11 RELEASE OF FRC BORROWER. Provided that no Default or Event of
Default has occurred and is continuing (or would occur or exist as a result of
or following the release of an FRC Borrower pursuant to this SECTION 3.11),
Fleetwood shall have the right, subject to the provisions of this SECTION 3.11,
to obtain a release of an FRC Borrower (each, an "FRC BORROWER RELEASE") from
its Obligations under this Agreement and the other Loan Documents. In the event
Fleetwood seeks to obtain an FRC Borrower Release, the Agent shall release such
FRC Borrower (each a "RELEASED FRC BORROWER") from this Agreement and the other
Loan Documents, but only upon satisfaction of all of the following conditions:
(a) Any request for an FRC Borrower Release shall be
made in writing to the Agent no less than five (5) Business Days prior
to the date of the requested FRC Borrower Release;
(b) the FRC Borrowers make any payment required
pursuant to SECTION 3.4(e) in connection with such FRC Borrower
Release;
(c) the FRC Borrowers shall pay all of the Agent's
reasonable costs and expenses, including counsel fees and
disbursements, incurred in connection with the FRC Borrower Release and
the review and approval of the documents and information required to be
delivered in connection therewith; and
(d) the FRC Borrowers shall deliver to the Agent
simultaneously with the request referred to in clause (a) above, an FRC
Borrowing Base Certificate signed by
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an Authorized Officer of FRC, representing and certifying the pro
forma calculations after giving effect to the proposed FRC Borrower
Release.
ARTICLE 4
TAXES, YIELD PROTECTION AND ILLEGALITY
4.1 TAXES.
(a) Any and all payments by the Borrowers to each
Lender or the Agent under this Agreement and any other Loan Document
shall be made free and clear of, and without deduction or withholding
for any Taxes. In addition, the Borrowers shall pay all Other Taxes.
(b) Each Borrower agrees to indemnify and hold
harmless each Lender and the Agent for the full amount of Taxes or
Other Taxes (including any Taxes or Other Taxes imposed by any
jurisdiction on amounts payable under this Section) paid by any Lender
or the Agent and any liability (including penalties, interest,
additions to tax and expenses) arising therefrom or with respect
thereto, whether or not such Taxes or Other Taxes were correctly or
legally asserted. Payment under this indemnification shall be made
within 30 days after the date such Lender or the Agent makes written
demand therefor.
(c) If a Borrower shall be required by law to deduct
or withhold any Taxes or Other Taxes from or in respect of any sum
payable hereunder to any Lender or the Agent, then:
(i) the sum payable shall be increased as
necessary so that after making all required deductions and
withholdings (including deductions and withholdings applicable
to additional sums payable under this Section) such Lender or
the Agent, as the case may be, receives an amount equal to the
sum it would have received had no such deductions or
withholdings been made;
(ii) such Borrower shall make such
deductions and withholdings;
(iii) such Borrower shall pay the full
amount deducted or withheld to the relevant taxing authority
or other authority in accordance with applicable law; and
(iv) such Borrower shall also pay to each
Lender or the Agent for the account of such Lender, at the
time interest is paid, all additional amounts which the
respective Lender specifies as necessary to preserve the
after-tax yield such Lender would have received if such Taxes
or Other Taxes had not been imposed.
(d) At the Agent's request, within 30 days after the
date of any payment by a Borrower of Taxes or Other Taxes, such
Borrower shall furnish the Agent the original or a certified copy of a
receipt evidencing payment thereof, or other evidence
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of payment satisfactory to the Agent. If any Borrower determines in
good faith that a reasonable basis exists for contesting any Taxes or
Other Taxes, at the request of such Borrower, the relevant Lender shall
cooperate with such Borrower in challenging such Tax or Other Tax at
such Borrower's expense (but shall have no obligation to disclose any
confidential information with respect to such Lender). No Lender shall
have any obligation to contest any Tax or Other Tax, except to
cooperate with the Borrowers in any contest requested by a Borrower as
provided herein. If any Lender becomes aware that it has received a
refund for any Tax or Other Tax for which a payment has been made to it
by the Borrowers under this Section, which in the good faith judgment
of such Lender is allocable to such payment, the amount of such refund
shall be paid to the applicable Borrower(s) to the extent that such
Borrower(s) have paid in full the payments required by this SECTION 4.1
(e) If a Borrower is required to pay additional
amounts to any Lender or the Agent pursuant to SUBSECTION (c) of this
Section, then such Lender shall use reasonable efforts (consistent with
legal and regulatory restrictions) to change the jurisdiction of its
lending office so as to eliminate any such additional payment by such
Borrower which may thereafter accrue, if such change in the judgment of
such Lender is not otherwise disadvantageous to such Lender.
4.2 ILLEGALITY.
(a) If any Revolving Credit Lender determines that
the introduction of any Requirement of Law, or any change in any
Requirement of Law, or in the interpretation or administration of any
Requirement of Law, has made it unlawful, or that any central bank or
other Governmental Authority has asserted that it is unlawful, for any
Revolving Credit Lender or its applicable lending office to make LIBOR
Rate Loans, then, on notice thereof by that Revolving Credit Lender to
the Borrowers through the Agent, any obligation of that Revolving
Credit Lender to make LIBOR Rate Loans shall be suspended until that
Revolving Credit Lender notifies the Agent and the Borrowers that the
circumstances giving rise to such determination no longer exist.
(b) If a Revolving Credit Lender determines that it
is unlawful to maintain any LIBOR Rate Loan, the Borrowers shall, upon
receipt of notice of such fact and demand from such Revolving Credit
Lender (with a copy to the Agent), prepay in full such LIBOR Rate Loans
of that Revolving Credit Lender then outstanding, together with
interest accrued thereon and amounts required under SECTION 4.4, either
on the last day of the Interest Period thereof, if that Revolving
Credit Lender may lawfully continue to maintain such LIBOR Rate Loans
to such day, or immediately, if that Revolving Credit Lender may not
lawfully continue to maintain such LIBOR Rate Loans. If the Borrowers
are required to so prepay any LIBOR Rate Loans, then concurrently with
such prepayment, the applicable Borrower shall borrow from the affected
Revolving Credit Lender, in the amount of such repayment, a Base Rate
Loan.
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4.3 INCREASED COSTS AND REDUCTION OF RETURN.
(a) If any Lender determines that due to either (i)
the introduction of any Requirement of Law, or any change in any
Requirement of Law, or any change in the interpretation of any
Requirement of Law or (ii) the compliance by that Lender with any
guideline or request from any central bank or other Governmental
Authority (whether or not having the force of law), there shall be any
increase in the cost to such Lender of agreeing to make or making,
funding or maintaining any LIBOR Rate Loans, then the Borrowers shall
be liable for, and shall from time to time, upon demand (with a copy of
such demand to be sent to the Agent), pay to the Agent for the account
of such Lender, additional amounts as are sufficient to compensate such
Lender for such increased costs.
(b) If any Lender shall have determined that (i) the
introduction of any Capital Adequacy Regulation, (ii) any change in any
Capital Adequacy Regulation, (iii) any change in the interpretation or
administration of any Capital Adequacy Regulation by any central bank
or other Governmental Authority charged with the interpretation or
administration thereof, or (iv) compliance by such Lender or any
corporation or other entity controlling such Lender with any Capital
Adequacy Regulation, affects or would affect the amount of capital
required or expected to be maintained by such Lender or any corporation
or other entity controlling such Lender and (taking into consideration
such Lender's or such corporation's or other entity's policies with
respect to capital adequacy and such Lender's desired return on
capital) determines that the amount of such capital is increased as a
consequence of its Commitments, Loans, credits or obligations under
this Agreement, then, upon demand of such Lender to the Borrowers
through the Agent, the Borrowers shall pay to such Lender, from time to
time as specified by such Lender, additional amounts sufficient to
compensate such Lender for such increase.
4.4 FUNDING LOSSES. FMC or FRC, as the case may be, shall reimburse
each Revolving Credit Lender and hold each Revolving Credit Lender harmless from
any loss or expense which such Lender may sustain or incur as a consequence of:
(a) the failure of the applicable Borrower(s) to make
on a timely basis any payment of principal of any LIBOR Rate Loan;
(b) the failure of the applicable Borrower(s) to
borrow, continue or convert a Loan after such Borrower has given (or is
deemed to have given) a Notice of Borrowing or a Notice of
Continua