DEBTOR-IN-POSSESSION CREDIT AGREEMENT

Loan Agreement

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FOAMEX INTERNATIONAL INC. | BANK OF AMERICA, N.A. | FMXI, LLC | FOAMEX ASIA, INC | FOAMEX CANADA INC | FOAMEX CARPET CUSHION LLC

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Title: DEBTOR-IN-POSSESSION CREDIT AGREEMENT
Date: 3/2/2009
Industry: Containers and Packaging Law Firm: Bracewell Giuliani Sector: Basic Materials

EXECUTION COPY

DEBTOR-IN-POSSESSION CREDIT AGREEMENT

Dated as of February 24, 2009

Among

FOAMEX L.P.,

as Borrower,

FOAMEX INTERNATIONAL INC.,

FMXI, LLC,

FOAMEX CANADA INC.,

FOAMEX LATIN AMERICA, INC.,

FOAMEX MEXICO, INC.,

FOAMEX ASIA, INC. AND

FOAMEX CARPET CUSHION LLC,

as Guarantors,

THE FINANCIAL INSTITUTIONS NAMED HEREIN,

as the Lenders,

and

BANK OF AMERICA, N.A.,

as the Administrative Agent,

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TABLE OF CONTENTS

Page

ARTICLE I

NEW TERM LOANS AND LETTERS OF CREDIT

SECTION 1.1

Total Facility

SECTION 1.2

New Term Loans

SECTION 1.3

Prepetition Revolving Loans and Swap Obligations

SECTION 1.4

Letters of Credit

ARTICLE II

INTEREST, MAKE-WHOLE AMOUNT AND FEES

SECTION 2.1

Interest

SECTION 2.2

Intentionally Omitted

SECTION 2.3

Maximum Interest Rate

SECTION 2.4

Facility Fee

SECTION 2.5

Make-Whole Amount

SECTION 2.6

Letter of Credit Fee

SECTION 2.7

Upfront Fee

ARTICLE III

PAYMENTS AND PREPAYMENTS

SECTION 3.1

New Term Loans

SECTION 3.2

Intentionally Omitted

SECTION 3.3

Intentionally Omitted

SECTION 3.4

Intentionally Omitted

SECTION 3.5

Intentionally Omitted

SECTION 3.6

Payments by Borrower

SECTION 3.7

Intentionally Omitted

SECTION 3.8

Apportionment, Application and Reversal of Payments

SECTION 3.9

Indemnity for Returned Payments

SECTION 3.10

Administrative Agent's and Lenders' Books and Records; Monthly

Statements

SECTION 3.11

Certain Bankruptcy Matters; Superpriority of Obligations; Priming

Liens

ARTICLE IV

TAXES, YIELD PROTECTION AND ILLEGALITY

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TABLE OF CONTENTS

(continued)

Page

SECTION 4.1

Taxes

SECTION 4.2

Intentionally Omitted

SECTION 4.3

Increased Costs and Reduction of Return

SECTION 4.4

Intentionally Omitted

SECTION 4.5

Intentionally Omitted

SECTION 4.6

Certificates of Administrative Agent and Lenders

SECTION 4.7

Survival

SECTION 4.8

Limitation on Claims

ARTICLE V

FINANCIAL INFORMATION; NOTICES

SECTION 5.1

Financial Statements; Projections

SECTION 5.2

Certificates; Other Information

SECTION 5.3

Notices

SECTION 5.4

E-Mail Deliveries

ARTICLE VI

GENERAL WARRANTIES AND REPRESENTATIONS

SECTION 6.1

Existence, Qualification and Power; Compliance with Laws

SECTION 6.2

Authorization; No Contravention

SECTION 6.3

Governmental Authorization; Other Consents

SECTION 6.4

Binding Effect

SECTION 6.5

Financial Statements; No Material Adverse Effect

SECTION 6.6

Litigation

SECTION 6.7

No Default

SECTION 6.8

Properties

SECTION 6.9

Environmental Matters

SECTION 6.10

Insurance

SECTION 6.11

Taxes

SECTION 6.12

ERISA Compliance

SECTION 6.13

Subsidiaries; Equity Interests

SECTION 6.14

Margin Regulations; Investment Company Act; Public Utility Holding

Company Act

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TABLE OF CONTENTS

(continued)

Page

SECTION 6.15

Disclosure

SECTION 6.16

Compliance with Laws

SECTION 6.17

Intentionally Omitted

SECTION 6.18

Intellectual Property Matters

SECTION 6.19

Security Interests

SECTION 6.20

Use of Proceeds

SECTION 6.21

FMXI

SECTION 6.22

Anti-Terrorism Law

SECTION 6.23

Intentionally Omitted

SECTION 6.24

Trade Names; Jurisdiction of Organization; Location of Chief

Executive Office; Organizational Identification Number

SECTION 6.25

Bank Accounts

SECTION 6.26

Reorganization Matters

SECTION 6.27

Transfers

ARTICLE VII

AFFIRMATIVE AND NEGATIVE COVENANTS

SECTION 7.1

Payment of Taxes

SECTION 7.2

Preservation of Existence, Etc

SECTION 7.3

Maintenance of Properties

SECTION 7.4

Maintenance of Insurance

SECTION 7.5

Compliance with Laws

SECTION 7.6

Books and Records

SECTION 7.7

Inspection Rights

SECTION 7.8

Use of Proceeds

SECTION 7.9

Compliance with Environmental Laws

SECTION 7.10

Additional Collateral; Additional Guarantors

SECTION 7.11

Intentionally Omitted

SECTION 7.12

Information Regarding Collateral

SECTION 7.13

Other Affirmative Covenants

SECTION 7.14

Liens

SECTION 7.15

Investments; Bank Accounts

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TABLE OF CONTENTS

(continued)

Page

SECTION 7.16

Indebtedness

SECTION 7.17

Fundamental Changes

SECTION 7.18

Disposal of Assets

SECTION 7.19

Restricted Payments

SECTION 7.20

Change in Nature of Business

SECTION 7.21

Transactions with Affiliates

SECTION 7.22

Intentionally Omitted

SECTION 7.23

Clauses Restricting Subsidiary Distributions

SECTION 7.24

Market Regulations

SECTION 7.25

Minimum EBITDA

SECTION 7.26

Maximum Capital Expenditures

SECTION 7.27

Modifications of Organization Documents and Other Documents,

Prepayment of Subordinated Indebtedness, Etc.

SECTION 7.28

Change in Fiscal Year; Recording of Accounts

SECTION 7.29

Anti-Terrorism Law; Anti-Money Laundering

SECTION 7.30

Embargoed Person

SECTION 7.31

Intentionally Omitted

SECTION 7.32

Acquisitions

SECTION 7.33

Minimum Net Availability

SECTION 7.34

Applications to Bankruptcy Court

ARTICLE VIII

CONDITIONS OF LENDING

SECTION 8.1

Conditions Precedent - Closing Date

SECTION 8.2

Conditions Precedent to Each New Term Loan

ARTICLE IX

DEFAULT; REMEDIES

SECTION 9.1

Events of Default

SECTION 9.2

Remedies

ARTICLE X

TERM AND TERMINATION

SECTION 10.1

Term and Termination

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TABLE OF CONTENTS

(continued)

Page

ARTICLE XI

AMENDMENTS; WAIVERS; PARTICIPATIONS; ASSIGNMENTS; SUCCESSORS

SECTION 11.1

Amendments and Waivers

SECTION 11.2

Assignments; Participations

ARTICLE XII

THE ADMINISTRATIVE AGENT

SECTION 12.1

Appointment and Authorization

SECTION 12.2

Delegation of Duties

SECTION 12.3

Liability of the Administrative Agent

SECTION 12.4

Reliance by the Administrative Agent

SECTION 12.5

Notice of Default

SECTION 12.6

Credit Decision

SECTION 12.7

Indemnification

SECTION 12.8

Administrative Agent in Individual Capacity

SECTION 12.9

Successor Administrative Agent

SECTION 12.10

Withholding Tax

SECTION 12.11

Collateral Matters

SECTION 12.12

Restrictions on Actions by Lenders; Sharing of Payments

SECTION 12.13

Agency for Perfection

SECTION 12.14

Payments by Administrative Agent to Lenders

SECTION 12.15

Settlement

SECTION 12.16

Letters of Credit; Intra-Lender Issues

SECTION 12.17

Concerning the Collateral and the Related Loan Documents

SECTION 12.18

Field Audit and Examination Reports; Disclaimer by Lenders

SECTION 12.19

Relation Among Lenders

ARTICLE XIII

GUARANTEES

ARTICLE XIV

MISCELLANEOUS

SECTION 14.1

No Waivers; Cumulative Remedies

SECTION 14.2

Severability

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TABLE OF CONTENTS

(continued)

Page

SECTION 14.3

Governing Law; Choice of Forum; Service of Process

SECTION 14.4

WAIVER OF JURY TRIAL

SECTION 14.5

Survival of Representations and Warranties

SECTION 14.6

Other Security and Guaranties

SECTION 14.7

Fees and Expenses

SECTION 14.8

Notices

SECTION 14.9

Waiver of Notices

SECTION 14.10

Binding Effect

SECTION 14.11

Indemnity of the Administrative Agent and the Lenders by the Loan

Parties

SECTION 14.12

Limitation of Liability

SECTION 14.13

Final Agreement

SECTION 14.14

Counterparts

SECTION 14.15

Captions

SECTION 14.16

Right of Setoff

SECTION 14.17

Confidentiality

SECTION 14.18

Conflicts with Other Loan Documents

SECTION 14.19

Intentionally Omitted

SECTION 14.20

Intentionally Omitted

SECTION 14.21

Press Releases and Related Matters

SECTION 14.22

USA PATRIOT Act Notice

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TABLE OF CONTENTS

(continued)

Page

ANNEXES, EXHIBITS AND SCHEDULES

ANNEX A

DEFINED TERMS

ANNEX B

FINANCIAL COVENANT RATIOS

EXHIBIT A

FORM OF BORROWING BASE CERTIFICATE

EXHIBIT B

FORM OF NOTICE OF BORROWING

EXHIBIT C

FORM OF ASSIGNMENT AND ACCEPTANCE AGREEMENT

EXHIBIT D

INTERIM ORDER

SCHEDULE 1.2

NEW TERM LOAN COMMITMENTS

SCHEDULE 6.6

LITIGATION

SCHEDULE 6.9

ENVIRONMENTAL MATTERS

SCHEDULE 6.12(b)

FOREIGN PLANS

SCHEDULE 6.13(a)

SUBSIDIARIES

SCHEDULE 6.13(b)

EQUITY INTERESTS

SCHEDULE 6.24

TRADE NAMES; CORPORATE INFORMATION

SCHEDULE 6.25

BANK ACCOUNTS

SCHEDULE 7.13

POST CLOSING

SCHEDULE 7.14

EXISTING LIENS

SCHEDULE 7.15

EXISTING INVESTMENTS

SCHEDULE 7.16

EXISTING INDEBTEDNESS

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DEBTOR-IN-POSSESSION CREDIT AGREEMENT

This Debtor-In-Possession Credit Agreement, dated as of February 20, 2009 (this " Agreement "), among the financial institutions listed on the signature pages hereof (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 335 Madison Avenue, New York, New York, as administrative agent for the Lenders (in its capacity as administrative agent, together with any successor administrative agent, the " Administrative Agent "), Foamex L.P., a Delaware limited partnership (" Borrower "), Foamex International Inc., a Delaware corporation (" Holdings "), FMXI, LLC, a Delaware limited liability company (" FMXI "), and the other Guarantors (as defined herein).

W I T N E S S E T H :

WHEREAS, Borrower, Holdings, FMXI, the U.S Guarantors, certain lenders (the " Prepetition Revolving Lenders "), Bank of America, N.A., as administrative agent for such lenders (the " Prepetition Revolving Administrative Agent "), and certain other Persons (as hereinafter defined) are parties to a Revolving Credit Agreement, dated as of February 12, 2007, as amended to date (as so amended, the " Prepetition Revolving Credit Agreement "), pursuant to which the Prepetition Revolving Lenders agreed, subject to the terms and conditions therein contained, to make available to Borrower a revolving line of credit for revolving loans (the " Prepetition Revolving Loans ") and letters of credit in an aggregate principal amount not to exceed $175,000,000;

WHEREAS, in connection with the Prepetition Revolving Credit Agreement, the Borrower entered into certain Swap Contracts with the Prepetition Swap Provider (the " Prepetition Swap Contracts ")and caused certain commercial/documentary and standby letters of credit to be issued for its account by the Prepetition Issuing Bank (the " Prepetition Letters of Credit ");

WHEREAS, Borrower, Holdings, FMXI and the U.S. Guarantors are also parties to (i) a senior secured first lien term loan facility dated as of February 12, 2007 in an aggregate principal amount of up to $425,000,000 (as amended to date, the " Prepetition First Lien Term Loan Facility ") and (ii) a senior secured second lien term loan facility dated as of February 12, 2007 in an aggregate principal amount of up to $175,000,000 (as amended to date, the " Prepetition Second Lien Term Loan Facility ");

WHEREAS, as of the Closing Date, (i) the outstanding principal amount of the Prepetition Revolving Loans is approximately $0.00; (ii) the swap termination value of the Prepetition Swap Contracts is approximately $13,400,000 and (iii) the aggregate undrawn amount of the Prepetition Letters of Credit is approximately $25,600,000;

WHEREAS, on February 18, 2009 (the " Filing Date "), each of Borrower, Holdings, FMXI and the U.S. Guarantors (collectively, the " Debtors ") filed in the United States Bankruptcy Court for the District of Delaware (the " Bankruptcy Court ") a voluntary petition for relief under Chapter 11 of the Bankruptcy Code and continued in the possession of its assets and

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in the management of its business pursuant to Sections 1107 and 1108 of the Bankruptcy Code (each, a " Chapter 11 Case " and, collectively, the " Chapter 11 Cases ");

WHEREAS, Borrower has requested that Lenders provide a senior secured superpriority (subject to the Other Prepetition Liens) term loan and letter of credit facility in an aggregate principal amount not to exceed $95,000,000 at any time outstanding and maturing on the Termination Date;

WHEREAS, Lenders are willing to extend their commitment to make term loans and letters of credit available to Borrower for the purposes specified herein only on the terms and subject to the conditions set forth herein; and

WHEREAS, 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.

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 parties hereto hereby agree as follows.

ARTICLE I

NEW TERM LOANS AND LETTERS OF CREDIT

SECTION 1.1 Total Facility . Subject to the terms and conditions set forth herein (including, without limitation, the satisfaction of the conditions precedent set forth in Article 8) and subject to the Financing Orders, the Lenders agree to make available a total debtor-in-possession credit facility in an aggregate principal amount of up to $95,000,000 (the " Total Facility ") to Borrower from time to time during the term of this Agreement. The Total Facility shall be composed of the New Term Loans, the Secured Swap Obligations and the Letters of Credit described herein.

SECTION 1.2

New Term Loans .

(a) Amounts . Subject to the terms herein including the satisfaction of the conditions precedent set forth in Article 8 and subject to the Financing Orders, each New Term Lender severally, but not jointly, upon Borrower's request from time to time on any Business Day during the period from the entry of the Interim Order to the Termination Date, agrees to make new term loans (the " New Term Loans ") in an aggregate principal amount not to exceed such New Term Lender's New Term Loan Commitment; provided , however , that (i) no more than $20,000,000 of New Term Loans (excluding Facility Fees that are deemed to be New Term Loans pursuant to Section 2.4 and paid-in-kind interest added to the principal balance of any New Term Loan pursuant to Section 2.1) shall be made during the period beginning on the Closing Date and ending on the entry of the Final Order and (ii) after giving effect to such New Term Loan, the Aggregate Outstandings shall not exceed the Adjusted Borrowing Base then in effect. Notwithstanding anything herein to the contrary, not greater than $56,000,000 of New

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Term Loans (excluding Facility Fees that are deemed to be New Term Loans pursuant to Section 2.4 and paid-in-kind interest added to the principal balance of any New Term Loan pursuant to Section 2.1) shall be made during the term of this Agreement. Amounts borrowed under this Section 1.2(a) and repaid or prepaid may not be reborrowed.

(b)

Procedure for Borrowing of New Term Loans .

(i) Except for Facility Fees that are deemed to be New Term Loans pursuant to Section 2.4, each New Term Loan shall be made upon Borrower's irrevocable written notice (" Notice of Borrowing ") delivered to the New Term Lenders with copies to the Administrative Agent in the form of a notice of borrowing in the form of Exhibit B attached hereto and made a part hereof, which Notice of Borrowing must be received by the New Term Lenders and the Administrative Agent prior to 11:00 a.m. (New York time) on the requested Funding Date, specifying:

(A) the amount of such New Term Loan, which must equal or exceed $1,000,000 (and increments of $100,000 in excess of such amount); and

(B)

the requested Funding Date, which must be a Business Day.

For purposes of any Notice of Borrowing delivered pursuant to Section 1.2(b) above, the New Term Lenders acknowledge and agree that Borrower will be deemed to have given notice to all of the New Term Lenders if such Notice of Borrowing has been given to MP in accordance with the terms thereof.

(ii) No more than four Borrowings of New Term Loans (excluding any Borrowing in respect of Facility Fees that are deemed to be New Term Loans pursuant to Section 2.4 and New Term Loans used to repay any Unreimbursed Amounts) may be requested in any calendar month.

(iii) In lieu of delivering a Notice of Borrowing, Borrower may give the New Term Lenders or MP and Administrative Agent telephonic notice of such request for advances to the Designated Account on or before the deadline set forth under Section 1.2(b)(i) above. The New Term Lenders and the Administrative Agent at all times shall be entitled to rely on such telephonic notice in making such New Term Loans, regardless of whether any written confirmation is received.

(c) Reliance upon Authority . Prior to the Closing Date, Borrower shall deliver to the Administrative Agent a notice setting forth the account of Borrower (such account of Borrower referred to herein as a " Designated Account ") to which the Administrative Agent is authorized to transfer the proceeds of the New Term Loans requested by Borrower hereunder. Borrower may designate a replacement Designated Account from time to time by written notice. All such Designated Accounts must be reasonably satisfactory to the Administrative Agent. The Administrative Agent is entitled to rely conclusively on any person's request for New Term Loans on behalf of Borrower, so long as the proceeds thereof are to be transferred to the Designated Account of Borrower. The Administrative Agent has no duty to verify the identity of any individual representing himself or herself as a person authorized by Borrower to make such requests on its behalf.

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(d) No Liability . The Administrative Agent shall not incur any liability to Borrower as a result of acting upon any notice referred to in Sections 1.2(b) and (c) which the Administrative Agent believes in good faith to have been given by an officer or other person duly authorized by Borrower to request New Term Loans on its behalf. The crediting of New Term Loans to Borrower's Designated Account conclusively establishes the obligation of Borrower to repay such New Term 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. Borrower shall be bound to borrow the funds requested therein in accordance therewith.

(f)

Intentionally Omitted .

(g) Making of New Term Loans . Promptly after receipt of a Notice of Borrowing or telephonic notice in lieu thereof, each New Term Lender shall transfer its Pro Rata Share of the requested Borrowing to the Administrative Agent in immediately available funds, to the account from time to time designated by the Administrative Agent, not later than 1:00 p.m. (New York time) on the applicable Funding Date. After the Administrative Agent's receipt of all proceeds of such New Term Loan, the Administrative Agent shall make the proceeds of such New Term Loan available to Borrower on the applicable Funding Date by transferring same day funds to the account designated by Borrower.

SECTION 1.3 Prepetition Revolving Loans and Swap Obligations . Subject to the satisfaction of the conditions precedent set forth in Article 8 and subject to the Financing Orders, (a) Borrower acknowledges and agrees that on the Closing Date the aggregate outstanding principal amount of all Prepetition Revolving Loans (if any) shall constitute "Obligations" for purposes hereunder (the " Rolled Revolving Loans ") and (b) Borrower and the Swap Provider agree that on the Closing Date: (i) all Prepetition Swap Contracts in effect at such time shall constitute Secured Swap Contracts hereunder and (ii) all Swap Obligations under the Prepetition Swap Contracts shall be deemed to be Secured Swap Obligations.

SECTION 1.4

Letters of Credit .

(a) Agreement to Issue or Cause to Issue . Subject to the terms and conditions set forth herein (including, without limitation, the satisfaction of the conditions precedent set forth in Article 8) and subject to the Financing Orders, the Administrative Agent agrees to cause the Letter of Credit Issuer to issue for the account of Borrower the standby Letter of Credit issued or to be issued for the account of Borrower in the face amount of up to $3,200,000 and naming Ace American Insurance Company as beneficiary (the " AAIC LC "). The Letter of Credit Issuer and each LC Lender agrees that, on the Closing Date, all Prepetition Letters of Credit outstanding at such time shall constitute Letters of Credit hereunder with the same effect and status as if such Letters of Credit were originally issued pursuant to this Agreement. All fees payable with respect to such Prepetition Letters of Credit accruing through the Closing Date shall be paid on the Closing Date. Until the Closing Date, the Letter of Credit fees with respect to all Prepetition Letters of Credit shall accrue and be payable at the rates set forth in the Prepetition Revolving Credit Agreement and on and after the Closing Date, the Letter of Credit fees shall be due and payable as set forth in Section 2.6.

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(b) Amounts; Renewals . The Administrative Agent shall not have any obligation to issue or cause the Letter of Credit Issuer to issue the AAIC LC at any time: (i) if the maximum face amount of the AAIC LC is greater than the Unused Letter of Credit Subfacility at such time, (ii) the maximum undrawn amount of the AAIC LC and all commissions, fees (other than Letter of Credit Fees) and charges due from the Borrower in connection with the opening thereof would exceed the Letter of Credit Availability at such time, (iii) after giving effect to the AAIC LC, the Aggregate Outstandings would exceed the Adjusted Borrowing Base then in effect or (iv) the AAIC LC has an expiration date later than one year after its date of issuance. With respect to any Letter of Credit which contains any "evergreen" or automatic renewal provision, each LC Lender consents to, and the Letter of Credit Issuer agrees to permit, any such extension or renewal if no Event of Default exists as of the last day on which the Letter of Credit Issuer has the right to give notice of non-extension or non-renewal. With respect to any Letter of Credit which contains an optional extension or renewal provision or expires during the term of this Agreement and so long as no Event of Default has occurred and is continuing, the Letter of Credit Issuer agrees to extend or renew the expiry date of such Letter of Credit if the Borrower requests and each LC Lender and agrees to consent to such extension or renewal.

(c) Other Conditions . In addition to conditions precedent contained in Article 8, the obligation of the Administrative Agent to cause to be issued any Letter of Credit is subject to the following conditions precedent having been satisfied in a manner reasonably satisfactory to the Administrative Agent:

(i) The 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 Administrative 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 Administrative 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.

(d)

Issuance of Letters of Credit .

(i) Request for Issuance . The Borrower must notify the Administrative Agent of a requested Letter of Credit at least three (3) Business Days prior to the proposed issuance date (or such later time as the Administrative Agent may agree). 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

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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 Administrative Agent; Issuance . As of the Business Day immediately preceding the requested issuance date of the Letter of Credit, the Administrative Agent shall determine the amount of the applicable Unused Letter of Credit Subfacility and Letter of Credit Availability of the Borrower as of such date. If (A) the face amount of the requested Letter of Credit is less than the Unused Letter of Credit Subfacility and (B) the amount of such requested Letter of Credit and all commissions, fees (other than Letter of Credit Fees) and charges due from the Borrower in connection with the opening thereof would not exceed the Letter of Credit Availability and (C) after giving effect to the Letter of Credit, the Aggregate Outstandings would not exceed the Adjusted Borrowing Base then in effect, the Administrative 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.

(e)

Payments Pursuant to Letters of Credit .

(i) Borrower agrees to reimburse immediately the Letter of Credit Issuer for any draw under any Letter of Credit issued for the account of Borrower, 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 issued for the account of Borrower immediately when due, irrespective of any claim, setoff, defense or other right which Borrower may have at any time against the Letter of Credit Issuer or any other Person. All Unreimbursed Amounts shall be due and payable on demand (together with interest) unless such demand shall have been made after 11:00 a.m. (New York time) on any Business Day, in which case, all Unreimbursed Amounts shall be due and payable on the immediately following Business Day. All past due Unreimbursed Amounts shall bear interest at the Default Rate.

(ii) Each LC Lender (including the LC Lender acting as Letter of Credit Issuer) shall upon any notice of any Unreimbursed Amounts make funds available to the Administrative Agent for the account of the Letter of Credit Issuer in an amount equal to its Pro Rata Share of the Unreimbursed Amount not later than 1:00 p.m. on the Business Day specified in such notice by the Administrative Agent. The Administrative Agent shall remit the funds so received to the Letter of Credit Issuer. Each LC Lender's payment to the Administrative Agent for the account of the Letter of Credit Issuer pursuant to this clause shall be deemed payment in respect of its participation in such LC Obligation in satisfaction of its participation obligation under Section 12.16.

(iii) Until each LC Lender funds its participation pursuant to this section for any amount drawn under any Letter of Credit, interest in respect of such LC Lender's Pro Rata Share of such amount shall be solely for the account of the Letter of Credit Issuer.

(iv) If any LC Lender fails to make available to the Administrative Agent for the account of the Letter of Credit Issuer any amount required to be paid by such LC Lender pursuant to the foregoing provisions of this Section by the time specified above, the Letter of Credit Issuer shall be entitled to recover from such LC Lender (acting through the

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Administrative Agent), on demand, such amount with interest thereon for the period from the date such payment is required to the date on which such payment is immediately available to the Letter of Credit Issuer at a rate per annum equal to the greater of the Federal Funds Rate and a rate determined by the Letter of Credit Issuer in accordance with banking industry rules on interbank compensation. A certificate of the Letter of Credit Issuer submitted to any LC Lender (through the Administrative Agent) with respect to any amounts owing under this clause (iv) shall be conclusive absent manifest error.

(f)

Indemnification; Exoneration; Power of Attorney .

(i) Indemnification . In addition to amounts payable as elsewhere provided in this Section 1.4, Borrower agrees to protect, indemnify, pay and save the LC Lenders and the Administrative Agent harmless from and against any and all claims, demands, liabilities, damages, losses, costs, charges and expenses (including reasonable attorneys' fees) which any LC Lender or the Administrative Agent (other than an LC 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 for the account of Borrower. Borrower's obligations under this Section shall survive payment of all other Obligations.

(ii) Assumption of Risk by Borrower . As among Borrower, the LC Lenders and the Administrative Agent, Borrower assumes 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, the LC Lenders and the Administrative 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 LC Lenders or the Administrative 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 Administrative Agent or any Lender under this Section 1.4(f).

(iii) Exoneration . Without limiting the foregoing, no action or omission whatsoever by the Administrative Agent or any LC Lender (excluding any LC Lender in its capacity as a Letter of Credit Issuer) shall result in any liability of the Administrative Agent or

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any LC Lender to Borrower, or relieve Borrower of any of its obligations hereunder to any such Person, under or with respect to any Letter of Credit issued or provided for the account of Borrower.

(iv) Rights Against Letter of Credit Issuer . Nothing contained in this Agreement is intended to limit Borrower's rights, if any, with respect to the Letter of Credit Issuer which arise as a result of the letter of credit application and related documents executed by and between Borrower and the Letter of Credit Issuer.

(v) Account Party . Borrower hereby authorizes and directs the Letter of Credit Issuer to deliver to the Administrative Agent all instruments, documents and other writings and property received by the Letter of Credit Issuer pursuant to the Letter of Credit issued for the account of Borrower, and to accept and rely upon the Administrative Agent's instructions and agreements with respect to all matters arising in connection with such Letter of Credit.

(g) Supporting Letter of Credit . If, notwithstanding the provisions of Section 1.4(b) and Section 10.1, any Letter of Credit (including the AAIC LC) is outstanding upon the termination of this Agreement, then upon such termination Borrower shall deposit with the Administrative Agent, for the ratable benefit of the Administrative Agent and the LC Lenders, with respect to each Letter of Credit issued for the account of Borrower, a standby letter of credit (a " Supporting Letter of Credit ") in form and substance satisfactory to the Administrative Agent, issued by an issuer satisfactory to the Administrative Agent in an amount equal to the greatest amount for which such Letter of Credit may be drawn plus any fees and expenses associated with such Letter of Credit, under which Supporting Letter of Credit the Administrative Agent is entitled to draw amounts necessary to reimburse the Administrative Agent and the LC Lenders for payments to be made by the Administrative Agent and the LC Lenders under such Letter of Credit and any fees and expenses associated with such Letter of Credit. Such Supporting Letter of Credit shall be held by the Administrative Agent, for the ratable benefit of the Administrative Agent and the LC Lenders, as security for, and to provide for the payment of, the aggregate undrawn amount of such Letters of Credit remaining outstanding.

(h) Letter of Credit Amounts . Unless otherwise specified herein, the amount of a Letter of Credit at any time shall be deemed to be the stated amount of such Letter of Credit in effect at such time; provided, however, that with respect to any Letter of Credit that, by its terms or the terms of any issuer document related thereto, provides for one or more automatic increases in the stated amount thereof, the amount of such Letter of Credit shall be deemed to be the maximum stated amount of such Letter of Credit after giving effect to all such increases, whether or not such maximum stated amount is in effect at such time.

ARTICLE II

INTEREST, MAKE-WHOLE AMOUNT AND FEES

SECTION 2.1

Interest .

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(a) Interest Rates . Except as otherwise provided in Section 2.1(c) below, all New Term Loans shall bear interest on the unpaid principal amount thereof from the date made or incurred until paid in full in cash at a rate equal to the lesser of (i) 14% per annum and (ii) the Maximum Rate. All interest charges shall be due and payable or paid-in-kind, as the case may be, as provided in Section 2.1(b) below and 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).

(b) Interest Payments . As of the last Business Day of each month, all accrued but unpaid interest on the New Term Loans for such month shall be "paid in kind" by being capitalized and added to the outstanding principal amount of the New Term Loans. Amounts representing accrued interest which are added to the outstanding principal of New Term Loans accruing such interest shall thereafter bear interest in accordance with Section 2.1(a) and shall otherwise be treated as part of the principal amount of the New Term Loans for purposes of this Agreement. All accrued but unpaid interest on the New Term Loans that has not been added to the principal amount of the New Term Loans as of the Termination Date shall be due and payable on the Termination Date.

(c) Default Rate . If any Event of Default occurs and is continuing and the Majority Lenders in their discretion so elect, then, while any such Event of Default is continuing, all of the applicable Obligations shall bear interest at the Default Rate applicable thereto.

SECTION 2.2

Intentionally Omitted .

SECTION 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 such Lender with respect to loans of the type provided for hereunder (the " Maximum Rate "). If, in any month, any interest rate for any Obligations, absent such limitation, would have exceeded the Maximum Rate, then the interest rate for such Obligations 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 for such Obligations shall remain at a Maximum Rate until such time as the amount of interest paid hereunder for such Obligations equals the amount of interest which would have been paid on such Obligations 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 for any Obligations is less than the total amount of interest which would, but for this Section 2.3, have been paid or accrued for such Obligations if the interest rate otherwise set forth in this Agreement for such Obligations had at all times been in effect, then Borrower shall, to the extent permitted by applicable law, pay the Administrative Agent, for the account of the applicable Lenders, an amount equal to the excess of (a) the lesser of (i) the amount of interest which would have been charged for such Obligations if the Maximum Rate had, at all times, been in effect or (ii) the amount of interest which would have accrued for such Obligations 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 for such Obligations. If a court of competent jurisdiction determines that the Administrative 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 applicable Obligations

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other than interest, in the inverse order of maturity, and if there are no applicable Obligations outstanding, the Administrative Agent and/or such Lender shall refund to Borrower such excess.

SECTION 2.4 Facility Fee . Borrower shall pay to the Administrative Agent, for the ratable account of each New Term Lender, fully earned, non refundable facility fees (the " Facility Fees ") equal to: (a) on the day of the entry of the Interim Order, $600,000 and (b) on the day of the entry of the Final Order, $1,080,000. Notwithstanding the foregoing, each Facility Fee shall be deemed to be a Borrowing of a New Term Loan and shall be added to the outstanding principal amount of the New Term Loans, as of the day such Facility Fee is due and payable. Amounts representing the Facility Fees which are added to the outstanding principal of New Term Loans accruing such interest shall thereafter bear interest in accordance with Section 2.1 and shall otherwise be treated as New Term Loans for purposes of this Agreement.

SECTION 2.5 Make-Whole Amount . If on or prior to the Stated Termination Date, Borrower repays or prepays in full, for any reason (including if such payment is made voluntarily, in accordance with Section 9.1(p), as a result of an acceleration following an Event of Default or otherwise), the principal balance of the New Term Loans outstanding hereunder (other than payments made pursuant to the consummation of the MP Sale), then Borrower shall pay to Administrative Agent, for the benefit of all New Term Lenders, the Make-Whole Amount (calculated as of such date of payment of such New Term Loans).

SECTION 2.6 Letter of Credit Fee . Borrower agrees to pay for each Letter of Credit (including Prepetition Letters of Credit rolled up into this Agreement in accordance with Section 1.4) issued for the account of Borrower: (a) to the Administrative Agent, for the account of the LC Lenders, in accordance with their respective Pro Rata Shares, a fee (the " Letter of Credit Fee ") at a per annum rate equal to the 4.00% on the undrawn amount of such Letter of Credit on or after the Closing Date, (b) to the Administrative Agent, for the benefit of the Letter of Credit Issuer, a fronting fee (the " Fronting Fee ") of one-quarter of one percent (0.250%) per annum on the undrawn amount of such Letter of Credit from time to time on or after the Closing Date and (c) to the Letter of Credit Issuer all costs, fees and expenses incurred or charged by the Letter of Credit Issuer in connection with the application for, processing of, issuance or extension of, drawing under or amendment to, any Letter of Credit. The Letter of Credit Fees and the Fronting Fee for any Letter of Credit shall be payable monthly in arrears on the first day of each calendar month (commencing with the first calendar month beginning after the Closing Date) and on the Termination Date. The Letter of Credit Fee and Fronting Fee shall be computed on the basis of a 360-day year for the actual number of days elapsed.

SECTION 2.7 Upfront Fee . Borrower agrees to pay to the Administrative Agent (for its own account) an upfront fee of $375,000 on the Closing Date.

ARTICLE III

PAYMENTS AND PREPAYMENTS

SECTION 3.1 New Term Loans . Borrower shall repay the outstanding principal balance of the New Term Loans, plus all accrued but unpaid interest thereon, on the Termination Date. Borrower may prepay the New Term Loans made to it at any time in whole without

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premium or penalty (except as provided in Section 2.5 above). Borrower may not make partial prepayments on the New Term Loans except as required by Section 9.1(p).

SECTION 3.2

Intentionally Omitted.

SECTION 3.3

Intentionally Omitted.

SECTION 3.4

Intentionally Omitted.

SECTION 3.5

Intentionally Omitted.

SECTION 3.6

Payments by Borrower .

(a) All payments to be made by Borrower shall be made without set-off, recoupment or counterclaim. Except as otherwise expressly provided herein, all payments hereunder shall be made to the Administrative Agent for the account of the applicable Lenders, at the account designated by the Administrative Agent and shall be made in Dollars and in immediately available funds, no later than 12:00 noon (New York time) on the date specified herein. Any payment received by the Administrative 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) 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.

SECTION 3.7

Intentionally Omitted .

SECTION 3.8

Apportionment, Application and Reversal of Payments .

(a) Payment of Letter of Credit fees shall, as applicable, be apportioned ratably among the LC Lenders and fees payable solely to the Administrative Agent.

(b) All payments hereunder (including principal and interest payments of New Term Loans) but excluding payments by the Borrower that are specified by the Borrower to be in respect of particular Obligations and that are made while no Event of Default has occurred and is continuing) and proceeds of Collateral received by the Administrative Agent, shall be applied, ratably, subject to the provisions of this Agreement:

(i) first , to pay any fees, indemnities or expense reimbursements then due to the Administrative Agent;

(ii) second , to pay any fees (including Letter of Credit fees) or expense reimbursements then due to the Swap Provider, the LC Lenders and Letter of Credit Issuer;

(iii) third , to pay all Unreimbursed Amounts and the Rolled Revolving Loans and, if there are no Unreimbursed Amounts, to cash collateralize the LC Obligations in an amount equal to 105% of all outstanding Letters of Credit;

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(iv) fourth , to cash collateralize the Secured Swap Obligations in an amount equal to 100% of such Secured Swap Obligations;

(v) fifth , to pay any fees (excluding the Make-Whole Amount) or expense reimbursements then due to the New Term Lenders;

(vi) sixth , upon payment in full of the obligations referenced in parts "first" through "fifth" above, to pay interest due in respect of the New Term Loans;

(vii) seventh , to pay or prepay principal of the New Term Loans and the Make-Whole Amount; and

(viii)

eighth , to the payment of any other Obligations.

The Administrative Agent and the Lenders shall have the continuing and exclusive right to apply and reverse and reapply, in each instance in accordance with this Section 3.8, any and all such proceeds and payments to any portion of the Obligations.

SECTION 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 Administrative 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 Administrative Agent, such Lender the Bank or such Affiliate of the Bank, as the case may be, and Borrower shall be liable to pay to the Administrative Agent, the Lenders, the Bank or any Affiliate of the Bank, and hereby does indemnify the Administrative Agent, the Lenders, the Bank and any Affiliate of the Bank and hold the Administrative Agent, the Lenders, the Bank and any Affiliate of the Bank 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 Administrative Agent, 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 Administrative Agent's, the Lenders', the Bank's and its Affiliates' 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.

SECTION 3.10 Administrative Agent's and Lenders' Books and Records; Monthly Statements . The Administrative Agent shall record the principal amount of the New Term Loans owing to each Lender, the undrawn 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 New Term Lender may note the date and amount of each payment or prepayment of principal of such New Term Lender's New Term Loans in its books and records. Failure by the Administrative Agent or any Lender to make such notation shall not affect the obligations of Borrower with respect to the New Term

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Loans or the Letters of Credit. Borrower agrees that the Administrative 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 Administrative Agent will provide to Borrower a monthly statement of New Term Loans, payments and other transactions pursuant to this Agreement. Such statement shall be deemed correct, accurate, and binding on Borrower 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 Administrative Agent), unless Borrower notifies the Administrative Agent in writing to the contrary within thirty (30) days after such statement is delivered. In the event a timely written notice of objections is given by Borrower, only the items to which exception is expressly made will be considered to be disputed by Borrower.

SECTION 3.11 Certain Bankruptcy Matters; Superpriority of Obligations; Priming Liens . Except to the extent otherwise provided in the Financing Orders, as the case may be, each Loan Party hereby agrees as follows:

(a) The Obligations shall be secured by Liens on the U.S. Collateral under Sections 364(c)(2), (c)(3) and (d)(1) of the Bankruptcy Code, senior to all other Liens (including, without limitation, those granted in connection with the Prepetition Credit Agreements) other than (i) Other Prepetition Liens and (ii) the Carve Out.

(b) The Obligations shall have the status in the Chapter 11 Cases of superpriority administrative expenses under Section 364(c)(1) of the Bankruptcy Code. Subject to the Carve Out and Other Prepetition Liens, such administrative claim shall have priority over all other claims, costs and expenses of the kinds specified in, or ordered pursuant to, Sections 105, 326, 328, 330, 331, 503(b), 506(c), 507(a), 507(b), 546(c), 726, 1114, or any other provision of the Bankruptcy Code and shall at all times be senior to the rights of any Loan Party, any Loan Party's estate, and any successor trustee or estate representative in the Chapter 11 Cases or any subsequent proceeding or case under the Bankruptcy Code.

(c) The Administrative Agent's Liens on the U.S. Collateral under Sections 364(c)(2), (c)(3) and (d)(1) of the Bankruptcy Code, for the benefit of the Lenders, and the superpriority administrative claim under Section 364(c)(1) of the Bankruptcy Code afforded the Obligations shall be subject only to the Carve Out and Other Prepetition Liens.

(d) Subject to the provisions of this Section 3.11, the Loan Parties shall be permitted to pay in accordance with the Cash Budget as the same may become due and payable (i) administrative expenses of the kind specified in Section 503(b) of the Bankruptcy Code incurred in the ordinary course of their businesses and (ii) compensation and reimbursement of expenses to professionals allowed or otherwise permitted to be paid by the Bankruptcy Court and payable under Sections 330 and 331 of the Bankruptcy Code. Except for the Carve Out, no costs or expenses of administration shall be imposed against the Administrative Agent, Lenders or any of the U.S. Collateral under Sections 105, 506(c) or 552 of the Bankruptcy Code, or otherwise, and, subject to entry of the Final Order, Borrower and each of the other Loan Parties hereby waives, for itself and on behalf of its estate in bankruptcy, any and all rights under Sections 105,

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506(c) or 552, or otherwise, to assert or impose or seek to assert or impose, any such costs or expenses of administration against Agent or the Lenders.

(e) Upon the Closing Date, and on behalf of themselves and their estates, and for so long as any Obligation shall be outstanding, each Loan Party hereby irrevocably waives any right, pursuant to Sections 364(c) and 364(d) of the Bankruptcy Code or otherwise, to grant any Lien of equal or greater priority than the Liens securing the Obligations or to approve a claim of equal or greater priority than the Obligations (other than Other Prepetition Liens and the Carve Out).

(f) Upon the maturity (whether by acceleration or otherwise) of any of the Obligations under this Agreement or any of the other Loan Documents, Lenders shall be entitled to immediate payment of such Obligations without further application to or order of the Bankruptcy Court.

(g) Upon entry by the Bankruptcy Court of the Interim Order, the Administrative Agent's Liens on the U.S. Collateral shall be deemed to be legal, valid and perfected Liens, subject to no other prior Liens other than Other Prepetition Liens and the Carve Out. Upon the entry by the Bankruptcy Court of the Interim Order, no additional filings or recordings shall be necessary to perfect the security interests created in the U.S. Collateral under the Security Agreement and the other Loan Documents and the Administrative Agent shall not be required to take possession of any U.S. Collateral or to take any other action in order to validate, render enforceable or perfect the Liens on the U.S. Collateral granted pursuant to the Security Agreement or any other Loan Document.

(h) Each of the Loan Parties agrees that unless the Obligations are paid and otherwise satisfied in full on for before confirmation of any Loan Party's Plan of Reorganization (i) the Obligations hereunder shall not be discharged by the entry of an order confirming a Plan of Reorganization in the Chapter 11 Cases (and each of the Loan Parties, pursuant to Section 1141(d)(4) of the Bankruptcy Code, hereby waives any such discharge) and (ii) the superpriority administrative claims granted to the Administrative Agent and Lenders pursuant to the Interim Order and Final Order and described in Section 3.11(b), and the Liens granted to the Administrative Agent pursuant to the Interim Order and the Final Order and the other Loan Documents and described in Section 3.11(a), shall not be affected in any manner by the entry of an order confirming a Plan of Reorganization in the Chapter 11 Cases.

ARTICLE IV

TAXES, YIELD PROTECTION AND ILLEGALITY

SECTION 4.1

Taxes . Subject to Sections 12.10(d) and (e):

(a) Except as required by applicable Law, any and all payments by Borrower and Guarantors, as applicable, or any of them to each Lender or the Administrative Agent under this Agreement or any other Loan Document shall be made free and clear of, and without deduction or withholding for any Indemnified Taxes. In addition, Borrower and Guarantors, as applicable, shall timely pay all Other Taxes.

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(b) Borrower and Guarantors, as applicable, agree, jointly and severally, to indemnify and hold harmless each Lender and the Administrative Agent for the full amount of Indemnified Taxes and Other Taxes (and any Taxes or Other Taxes imposed or asserted on or attributable to amounts payable under this Section) imposed on or paid by any Lender or the Administrative Agent and any penalties, interest, additions to tax and reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified 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 Administrative Agent makes demand therefor.

(c) If Borrower or a Guarantor, as applicable, shall be required by law to deduct or withhold any Indemnified Taxes or Other Taxes from or in respect of any sum payable hereunder or under any other Loan Document to any Lender or the Administrative Agent, then:

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

(ii) Borrower or such Guarantor, as applicable, shall make such deductions and withholdings; and

(iii) Borrower or such Guarantor, as applicable, shall pay the full amount deducted or withheld to the relevant authority in accordance with applicable law.

(d) Within 30 days after the date of any payment by Borrower or a Guarantor, as applicable, of Indemnified Taxes or Other Taxes, Borrower or such Guarantor, as applicable, shall furnish the Administrative Agent the original or a certified copy of a receipt evidencing payment thereof, or other evidence of payment reasonably satisfactory to the Administrative Agent or the Majority Lenders.

(e) Without limiting the provisions of subsections (b) and (c) above, each Borrower and such Guarantor shall, and does hereby, indemnify the Administrative Agent and each Lender, and shall make payment in respect thereof within 30 days after demand therefor, for the full amount of any Indemnified Taxes or Other Taxes (including Indemnified Taxes or Other Taxes imposed or asserted on or attributable to amounts payable under this Section) withheld or deducted by such Borrower or such Guarantor or the Administrative Agent or paid by the Administrative Agent or such Lender, as the case may be, and any penalties, interest and reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of any such payment or liability delivered to a Borrower or such Guarantor by a Lender or by the Administrative Agent on its own behalf or on behalf of a Lender, shall be conclusive absent manifest error. The agreements in this clause shall survive the resignation and/or replacement of the Administrative Agent, any assignment of rights by, or the replacement of, a Lender, the termination of the Total Facility and the repayment, satisfaction or discharge of all other Obligations.

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(f) If Borrower or a Guarantor, as applicable, shall notify, in writing, a Lender or the Administrative Agent that it is entitled to claim a refund from a Governmental Authority in respect of any Indemnified Taxes or Other Taxes as to which it has been indemnified by Borrower or such Guarantor, as applicable, or with respect to which Borrower or such Guarantor, as applicable, has paid additional amounts pursuant to this Section 4.1, it shall, at the expense of Borrower or such Guarantor, as the case may be, make a timely claim to such Governmental Authority for such refund. If a Lender or the Administrative Agent receives a refund (including pursuant to a claim for refund made pursuant to the preceding sentence) in respect of any Indemnified Taxes or Other Taxes as to which it has been indemnified by Borrower or such Guarantor or with respect to which Borrower or such Guarantor has paid additional amounts pursuant to this Section 4.1, it shall within 30 days from the date of such receipt pay over the amount of such refund to Borrower or such Guarantor, as the case may be, net of all reasonable out-of-pocket expenses of such Lender or Administrative Agent (to the extent not previously paid by Borrower or such Guarantor, as the case may be) and Taxes imposed upon the receipt of such refund, and without interest (other than interest paid by the relevant Governmental Authority with respect to such refund net of Taxes imposed upon the receipt of such interest). Such Lender or the Administrative Agent (as the case may be) may, in its reasonable discretion, determine the order of utilization of all charges, deductions, credits and expenses which reduce Taxes imposed on its net income. Nothing in this Section 4.1(f) shall be construed as requiring any Lender or the Administrative Agent (as the case may be) to conduct its business or to arrange or alter in any respect its Tax or financial affairs so that it is entitled to receive such refund, other than performing any ministerial acts necessary to be entitled to receive such refund.

(g) Notwithstanding anything contained herein to the contrary, the provisions of this Section 4.1 shall survive the expiration or termination of this Agreement and the other Loan Documents and the payment in full of all other Obligations

(h) In respect of amounts paid or credited by any Loan Party that is resident in Canada for purposes of the Income Tax Act (Canada) (the " ITA ") to or for the benefit of a particular Lender that is an "authorized foreign bank" for purposes of the ITA, the obligations under this Section 4.1 to pay an additional amount shall apply where the particular Lender is liable for Tax under Part XIII of the ITA in respect of such payment, even if the Loan Party is not required under the ITA to deduct or withhold an amount in respect of Indemnified Taxes on such payment and this Section 4.1 shall apply, mutatis mutandis, as if the Loan Party was required to withhold an amount in respect of such taxes.

SECTION 4.2

Intentionally Omitted .

SECTION 4.3

Increased Costs and Reduction of Return .

(a) 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 in which a change (or change in interpretation or administration) has occurred or which was enacted subsequent to the date hereof, affects or would affect the

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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 New Term Loan Commitments, New Term Loans, credits or obligations under this Agreement, then, upon demand of such Lender to Borrower through the Administrative Agent, Borrower shall pay to such Lender, from time to time as specified by such Lender, additional amounts sufficient to compensate such Lender for such increase.

(b) Each Lender agrees that, upon the occurrence of any event giving rise to the operation of this Section 4.3 with respect to such Lender, it will, if requested by Borrower, use reasonable efforts (subject to overall policy considerations of such Lender) to designate another lending office for any New Term Loans affected by such event with the object of avoiding the consequences of such event; provided that such designation is made on terms that, in the sole judgment of such Lender, cause such Lender and its lending office(s) to suffer no economic, legal or regulatory disadvantage, and provided, further, that nothing in this clause (c) shall affect or postpone any of the obligations of Borrower or the rights of any Lender pursuant to this Section 4.3.

SECTION 4.4

Intentionally Omitted .

SECTION 4.5

Intentionally Omitted .

SECTION 4.6 Certificates of Administrative Agent and Lenders . Any Lender (or the Administrative Agent, if applicable) claiming reimbursement or compensation under this Article 4 shall deliver to Borrower (with a copy to the Administrative Agent if delivered from a Lender) a certificate setting forth in reasonable detail the basis and calculation of the amount payable to such Lender (or the Administrative Agent, if applicable), and such certificate shall be conclusive and binding on Borrower in the absence of manifest error.

SECTION 4.7 Survival . The agreements and obligations of Borrower and each Guarantor in this Article 4 shall survive the payment of all other Obligations

SECTION 4.8 Limitation on Claims . Notwithstanding anything to the contrary contained herein, no Loan Party shall be required to make any payments to any Lender pursuant to any of Section 4.3 relating to any period of time which is greater than 180 days prior to the date such Lender demands payment of such amount, except to the extent that such Lender could not reasonably have been expected to discover such claim at the time of its incurrence, in which case, the 180-day period shall be tolled until such Lender discovers, or should reasonably have been expected to discover, such claim.

ARTICLE V

FINANCIAL INFORMATION; NOTICES

So long as any of the Obligations (other than Contingent Obligations at Termination) remain outstanding or this Agreement is in effect:

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SECTION 5.1 Financial Statements; Projections . Borrower shall deliver to the Administrative Agent for distribution to each Lender:

(a) as soon as available, but in any event within 180 days after the end of each Fiscal Year (commencing with the Fiscal Year ended December 28, 2008), a consolidated balance sheet of Holdings and its Subsidiaries as at the end of such Fiscal Year, and the related consolidated statements of operations, partners' equity and cash flows for such Fiscal Year, each setting forth in each case comparative form the figures for the previous Fiscal Year, all in reasonable detail and prepared in accordance with GAAP, audited and accompanied by a report and opinion of a nationally recognized independent registered public accounting firm reasonably acceptable to the Majority Lenders, which report and opinion shall be prepared in accordance with generally accepted auditing standards and shall not be subject to any "going concern" or like qualification or exception or any qualification or exception as to the scope of such audit (other than a going concern qualification as a result of the commencement of the Chapter 11 Cases);

(b) as soon as available, but in any event within 45 days after the end of each of the first three fiscal quarters of each Fiscal Year (commencing with the fiscal quarter ending March 31, 2009), (i) a consolidated balance sheet of Holdings and its Subsidiaries as at the end of such fiscal quarter, and (ii) the related consolidated statements of operations for such fiscal quarter and for the portion of the Fiscal Year then ended, each setting forth in each case in comparative form the figures for the corresponding fiscal quarter of the previous Fiscal Year and the corresponding portion of the previous Fiscal Year and the figures in the Closing Date Projections, all in reasonable detail, certified by a Responsible Officer of Holdings as fairly presenting in all material respects the financial condition and results of operations of Holdings and its consolidated Subsidiaries in accordance with GAAP, subject to normal year-end audit adjustments and the absence of footnotes;

(c) upon request of the Administrative Agent or the Majority Lenders, as soon as available, but in any event within 30 days after the end of each fiscal month of Holdings (or, in the case of the last fiscal month in a fiscal quarter of Holdings, within 45 days after the end of such fiscal month), (i) a consolidated balance sheet of Holdings and its Subsidiaries as at the end of such fiscal month, and (ii) the related consolidated statements of operations and cash flows for such fiscal month and for the portion of the Fiscal Year then ended, each setting forth in each case in comparative form the figures for the corresponding fiscal month of the previous Fiscal Year and the corresponding portion of the previous Fiscal Year and the figures in the Closing Date Projections, all in reasonable detail, certified by a Responsible Officer of Holdings as fairly presenting in all material respects the financial condition, results of operations and cash flows of Holdings and its consolidated Subsidiaries on a basis consistent with Holdings' prior internal reporting practices, subject to normal year-end audit adjustments and the absence of footnotes; and

(d) on the Closing Date, the Closing Date Projections which represent Holdings' good faith estimate of Holdings and its Subsidiaries future performance for the periods covered thereby based upon assumptions believed by Holdings to be reasonable at the time of the delivery thereof to the Administrative Agent (it being understood that such projections and forecasts are subject to uncertainties and contingencies, many of which are beyond the control of

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the Holdings and its Subsidiaries and no assurances can be given that such projections or forecasts will be realized).

As to any information contained in materials furnished pursuant to Section 5.2(d), Borrower shall not be separately required to furnish such information under clause (a) or (b) above, but the foregoing shall not be in derogation of the obligation of Borrower to furnish the information and materials described in clauses (a) and (b) above at the times specified therein.

SECTION 5.2 Certificates; Other Information . Borrower shall deliver to the Administrative Agent for distribution to each Lender:

(a) concurrently with the delivery of the audited financial statements referred to in Section 5.1(a), a certificate of its independent certified public accountants certifying such financial statements;

(b) concurrently with the delivery of the financial statements referred to in each of Sections 5.1(a) and (b) (commencing with the delivery of the financial statements for the fiscal quarter ending March 31, 2009), a duly completed Compliance Certificate signed by a Responsible Officer of Borrower detailing, among other things, the calculations used to determine compliance with Sections 7.25, 7.26 and 7.33;

(c) promptly after any request by the Administrative Agent or the Majority Lenders, copies of any detailed audit reports and management letters submitted to the board of directors (or the audit committee of the board of directors) of Holdings or Borrower by independent accountants in connection with the accounts or books of Holdings, Borrower or any of their Subsidiaries, or any audit of any of them;

(d) promptly after the same are available, copies of each annual report, proxy or financial statement or other report or communication sent generally to equityholders of Holdings or Borrower, and copies of all annual, regular, periodic and special reports and registration statements which Holdings or Borrower files with the SEC under Section 13 or 15(d) of the Exchange Act, and not otherwise required to be delivered to the Administrative Agent pursuant hereto;

(e) promptly after the furnishing thereof, copies of any statement or report furnished to any holder of material Indebtedness (or any agent or trustee for such holder) of any Loan Party pursuant to the terms of any indenture, loan or credit or similar agreement and not otherwise required to be furnished to the Administrative Agent pursuant to Section 5.1 or any other clause of this Section 5.2;

(f) promptly, and in any event within five Business Days after receipt thereof by any Loan Party, copies of each notice or other correspondence received from the SEC (or comparable agency in any applicable non-U.S. jurisdiction) concerning any material investigation or possible material investigation or other inquiry by such agency regarding financial or other operational results of any Loan Party;

(g)

Intentionally Omitted.

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(h) upon request by the Administrative Agent or the Majority Lenders, and in no event less frequently than once each month and not later than 15 days after the end of each month, a (i) monthly trial balance showing Accounts of Borrower and Foamex Canada outstanding aged based on original due date from statement date as follows: current, 6 to 30 days, 31 to 60 days, 61 to 90 days and 91 days or more, accompanied by such supporting detail and documentation as shall be requested by the Administrative Agent or the Majority Lenders in their reasonable discretion and (ii) a reconciliation of the Accounts of Borrower and Foamex Canada to the Borrowing Base Certificate;

(i) on the date the Borrowing Base Certificate is delivered pursuant to Section 5.2(j) or at such more frequent intervals as the Administrative Agent or the Majority Lenders may reasonably request from time to time, a collateral report with respect to Borrower and Foamex Canada, including all additions and reductions (cash and non-cash) with respect to Accounts accompanied by such supporting detail and documentation as shall be requested by the Administrative Agent or the Majority Lenders in their reasonable discretion;

(j) on a weekly basis (not later than 5:00 pm (New York time) on the fourth Business Day after the last Business Day of the previous week with the information thereon to be as of the last Business Day of such previous week), each of the following:

(i) a Borrowing Base Certificate;

(ii) the figures and calculations used to determine compliance with Sections 7.26 and 7.33 certified by a Responsible Officer of Borrower and otherwise in form and substance satisfactory to Administrative Agent and the Majority Lenders;

(iii) a written report from a Responsible Officer of Borrower in form and substance satisfactory to the Administrative Agent and Majority Lenders detailing :

(A) sales and volumes of each business unit of Borrower and its consolidated Subsidiaries for each of the immediately preceding five weeks and (2) projected sales and volumes of each business unit of Borrower for each of the immediately following five weeks;

(B) an aging of the accounts payable of Borrower and Foamex Canada;

(D) a variance report to the Cash Budget;

(E) a supplemental report to the Cash Budget reflecting a thirteen (13) week cash flow forecast as of the week just ended (it being understood that such supplemental report shall not be deemed to be an amendment or update to the Cash Budget); and

(F) a projected variance report to the Cash Budget and the supplemental report delivered pursuant to clause (F) above;

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(k) on a monthly basis (not later than the earlier of (i) 5:00 pm (New York time) on the fourteenth (14) Business Day after the last Business Day of the previous month and (ii) the Business Day on which Borrower's monthly EBITDA is communicated to the board of directors (or such other governing body) of Holdings or Borrower with the information thereon to be as of the last Business Day of such previous month)

(i) an inventory valuation report for the Borrower's and Foamex Canada's inventory reflecting value, weeks on hand and units; and

(ii) the figures and calculations used to determine compliance with Sections 7.25 certified by a Responsible Officer of Borrower and otherwise in form and substance satisfactory to Administrative Agent and the Majority Lenders;

(l) upon request by the Administrative Agent, an aging of the accounts payable of Borrower and Foamex Canada;

(m) as promptly as practicable with respect to the period commencing on and at all times after the Closing Date relating to any Loan Party or the Chapter 11 Cases (but only to the extent not available through the electronic filing system), copies of all filings with the Bankruptcy Court by any Person, all notices of hearings, all reports with respect to creditor's claims, copies of all written reports and other documents given by a Loan Party to any official or unofficial committee (including without limitation, the Creditors' Committee) in the Chapter 11 Cases and copies of all other materials relating to any matter over which the Bankruptcy Court has retained jurisdiction; provided, that any such filing, notice, report or other material need not be furnished to the Administrative Agent unless material; and

(n) promptly, such additional information regarding the business, financial or corporate affairs of any Loan Party, or compliance with the terms of the Loan Documents, as the Administrative Agent or any Lender may from time to time reasonably request.

Notwithstanding the foregoing, the Borrowing Base Certificate delivered pursuant to Section 5.2(j)(i) may be updated on a daily basis by Borrower in a manner reasonably satisfactory to the Administrative Agent with reports of new sales of Inventory resulting in Eligible Accounts; provided, that any such updates delivered hereunder shall be subject to any adjustments (including, without limitation, exclusion from the Base Borrowing Base of any new Accounts included in such update) that the Administrative Agent deems necessary in the exercise of its reasonable discretion. Documents required to be delivered pursuant to Section 5.1(a) or (b) or Section 5.2(d) (to the extent any such documents are included in materials otherwise filed with the SEC) may be delivered electronically and, if so delivered, shall be deemed to have been delivered on the date (i) on which Borrower posts such documents, or provides a link thereto, on Borrower's website on the Internet at its website address provided to the Administrative Agent and the Lenders; or (ii) on which such documents are posted on Borrower's behalf on an Internet or intranet website, if any, to which each Lender and the Administrative Agent have access (whether a commercial, third-party website or whether sponsored by the Administrative Agent); provided that (i) Borrower shall deliver paper copies of such documents to the Administrative Agent to fulfill the request of any Lender that requests Borrower to deliver such paper copies until a written request to cease delivering paper copies is given by the Administrative Agent or

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such Lender and (ii) Borrower shall notify the Administrative Agent (by facsimile or electronic mail) of the posting of any such documents and provide, if requested, to the Administrative Agent by electronic mail electronic versions (i.e., soft copies) of such documents. Notwithstanding anything contained herein, in every instance Borrower shall be required to promptly provide paper copies in addition to electronic mail copies of originally executed Compliance Certificates required by Section 5.2(b) to the Administrative Agent. Except for such Compliance Certificates, the Administrative Agent shall have no obligation to request the delivery or to maintain copies of the documents referred to above, and in any event shall have no responsibility to monitor compliance by Borrower with any such request for delivery, and each Lender shall be solely responsible for requesting delivery to it or maintaining its copies of such documents.

SECTION 5.3 Notices . Each of Holdings and Borrower shall, and shall cause each other Loan Party to, notify the Administrative Agent for communication to each Lender:

(a) promptly (but in no event later than one (1) Business Day) after the occurrence of any Default;

(b) promptly (but in no event later than two (2) Business Days) of any matter that has resulted or could reasonably be expected to result in a Material Adverse Effect, including to the extent the following meets the foregoing standard, (i) breach or non-performance of, or any default under, a Contractual Obligation of Holdings or any of its Subsidiaries; (ii) any dispute, litigation, investigation, proceeding or suspension between Holdings or any of its Subsidiaries and any Governmental Authority; or (iii) the commencement of, or any material development in, any litigation or proceeding affecting Holdings or any of its Subsidiaries, including pursuant to any applicable Environmental Laws;

(c) promptly (but in no event later than two (2) Business Days) of Holdings or Borrower or such other Loan Party becoming aware of the occurrence of any ERISA Event (or similar event with respect to a Foreign Plan) that, alone or together with any other ERISA Events (or similar events with respect to a Foreign Plan) that have occurred, would reasonably be expected to result in liability of Holdings, any of its Subsidiaries or any ERISA Affiliate in an aggregate amount exceeding $5,000,000, a written notice specifying the nature thereof, what action Holdings, such Subsidiary or ERISA Affiliate has taken, is taking or proposes to take with respect thereto, and, when known, any action taken or threatened by the IRS, United States Department of Labor, PBGC, Multiemployer Plan sponsor or other applicable Governmental Authority with respect thereto;

(d) promptly (but in no event later than one (1) Business Day) of any material change in accounting policies or financial reporting practices by any of the Loan Parties; and

(e) promptly (but in no event later than tow (2) Business Days) of any failure of Foamex Canada to pay or remit when due any amount for which it is liable in respect of any Pension Plan of Foamex Canada or of any Lien arising with respect to any Pension Plan of Foamex Canada (save for any Lien with respect to contribution amounts not yet due or delinquent that arise under the PBA or other applicable Canadian legislation).

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Each notice pursuant to this Section 5.3 shall be accompanied by a statement of a Responsible Officer of Borrower setting forth details of the occurrence referred to therein and stating what action the applicable Loan Party or ERISA Affiliate, as the case may be, has taken and proposes to take with respect thereto.

SECTION 5.4 E-Mail Deliveries . Each of the parties hereto hereby agrees that Borrower may, in lieu of delivering paper copies, transmit any Financial Statements or any of the items specified in Section 5.2 to the Administrative Agent by electronic mail; provided, that (i) each electronic mail transmission shall be (A) formatted as the Administrative Agent may designate from time to time and shall be digitally signed and (B) sent to the Administrative Agent at one or more electronic mail addresses designated by the Administrative Agent from time to time and (ii) the Administrative Agent (A) shall be authorized to rely upon any such electronic mail transmission for purposes of this Agreement to the same extent as if the contents thereof had been otherwise delivered to the Administrative Agent in accordance with the terms of this Agreement and (B) may, upon notice in writing to Borrower, terminate the right of Borrower to transmit such items via electronic mail.

ARTICLE VI

GENERAL WARRANTIES AND REPRESENTATIONS

Each Loan Party jointly and severally warrants and represents to the Administrative Agent and the Lenders that except as hereafter disclosed to and accepted by the Administrative Agent and the Majority Lenders in writing:

SECTION 6.1 Existence, Qualification and Power; Compliance with Laws . Each Loan Party and each Subsidiary thereof (a) is duly organized or formed, validly existing and in good standing under the Laws of the jurisdiction of its incorporation or organization, (b) subject to the entry and terms of the Interim Order has the organizational power and authority and all requisite governmental licenses, authorizations, consents and approvals to (i) own its assets and carry on its business and (ii) execute, deliver and perform its obligations under the Loan Documents to which it is a party, (c) is duly qualified and is licensed and in good standing under the Laws of each jurisdiction where its ownership, lease or operation of properties or the conduct of its business requires such qualification or license, and (d) is in compliance with all Laws, except in each case referred to in clauses (b)(i), (c) and (d), to the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect.

SECTION 6.2 Authorization; No Contravention . The execution, delivery and performance by each Loan Party of each Loan Document to which such Person is party have been duly authorized by all necessary corporate or other organizational action, and, upon entry by the Bankruptcy Court of the Interim Order, do not and will not (a) contravene the terms of any of such Person's Organization Documents; (b) conflict with or result in any breach or contravention of, or the creation of any Lien under (i) any post-petition Contractual Obligation to which such Person is a party or affecting such Person or the properties of such Person or any of its Subsidiaries or (ii) any post-petition order, injunction, writ or decree of any Governmental Authority or any arbitral award to which such Person or its property is subject; or (c) violate any Law. Each Loan Party and each Subsidiary thereof is in compliance with all Contractual

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Obligations referred to in clause (b)(i), except to the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect.

SECTION 6.3 Governmental Authorization; Other Consents . No approval, consent, exemption, authorization, or other action by, or notice to, or filing with, any Governmental Authority or any other Person is necessary or required in connection with (a) the execution, delivery or performance by any Loan Party of this Agreement or any other Loan Document, (b) the grant by any Loan Party of the Liens granted by it pursuant to the Loan Documents, (c) the perfection or maintenance of the Liens created under the Loan Documents (including the priority thereof) or (d) the exercise by the Administrative Agent or any Lender of its rights under the Loan Documents or the remedies in respect of the Collateral, except for (i) the entry of the Financing Orders and such other approvals, consents, exemptions, authorizations, actions, notices and filings which have been duly obtained, taken, given or made and are in full force and (ii) those approvals, consents, exemptions, authorizations, actions, notices or filings, the failure of which to obtain or make could not reasonably be expected to have a Material Adverse Effect.

SECTION 6.4 Binding Effect . Subject to the entry and the terms of the Financing Orders, this Agreement has been, and each other Loan Document, when delivered hereunder, will have been, duly executed and delivered by each Loan Party that is party thereto. This Agreement constitutes, and each other Loan Document when so delivered will constitute, a legal, valid and binding obligation of such Loan Party, enforceable against each Loan Party that is party thereto in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors' rights generally, and by general equitable principles (whether enforcement is sought by proceedings in equity or at law).

SECTION 6.5

Financial Statements; No Material Adverse Effect.

(a) Intentionally Omitted.

(b) The financial statements delivered from time to time pursuant to each of Sections 5.1(a), (b) and (c) (i) were prepared in accordance with GAAP consistently applied throughout the periods covered thereby, except as otherwise expressly noted therein, and (ii) fairly present in all material respects the financial condition of Holdings and its consolidated Subsidiaries as of the date thereof and their results of operations for the periods covered thereby, subject, in the case of clauses (i) and (ii) with respect to interim financial statements, to the absence of footnotes and to normal year-end audit adjustments.

(c) Since the date of the last audited financial statements of Holdings, there has been no event or circumstance, either individually or in the aggregate, that has had or could reasonably be expected to have a Material Adverse Effect other than those events which customarily occur as a result of events leading up to the commencement of a proceeding under Chapter 11 of the Bankruptcy Code.

(d) Intentionally Omitted.

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(e) The consolidated forecasted balance sheets and statements of income and cash flows of Borrower and its Subsidiaries delivered to the Administrative Agent from time to time pursuant to Section 5.1(d) were prepared in good faith on the basis of estimates, information and assumptions believed by management of Holdings to be reasonable at the time made, it being recognized by the Administrative Agent and the Lenders that such financial information as it relates to future events is not to be viewed as fact and that actual results during the period or periods covered by such financial information may differ from the projected results set forth therein by a material amount.

SECTION 6.6 Litigation . There are no actions, suits, proceedings, claims or disputes pending or, to the knowledge of any of Holdings or any of its Subsidiaries, threatened or contemplated, at law, in equity, in arbitration or before any Governmental Authority, by or against Holdings or any of its Subsidiaries or against any of their properties or revenues that (a) purport to affect or pertain to this Agreement or any other Loan Document, or any of the transactions contemplated hereby or (b) except as set forth on Schedule 6.6, either individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect. All of the actions, suits and proceedings set forth on Schedule 6.6 are stayed by virtue of the application of Section 362 of the Bankruptcy Code.

SECTION 6.7 No Default . Except for defaults relating solely from the filing of the Chapter 11 Cases and payment defaults under the Prepetition Credit Agreements, neither Holdings nor any of its Subsidiaries is in default under or with respect to any Contractual Obligation that would, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. No Default has occurred and is continuing or would result from the consummation of the transactions contemplated by this Agreement or any other Loan Document.

SECTION 6.8

Properties .

(a) Generally . Holdings and each of its Subsidiaries has good title to, or valid leasehold interests in, all its tangible property material to its business (except for minor irregularities or deficiencies in title to Real Property that in the aggregate do not materially interfere with its ability to conduct its business as currently conducted or to utilize such property for its intended purpose), free and clear of all Liens except for Permitted Liens. The tangible property of Holdings and its Subsidiaries, taken as a whole, (i) is in good operating order, condition and repair (ordinary wear and tear excepted) and (ii) constitutes all the tangible property which is required for the business and operations of Holdings and its Subsidiaries as presently conducted.

(b)

Intentionally Omitted.

(c) No Extraordinary Receipts . As of the date hereof, none of Holdings or any of its Subsidiaries has received any notice of, nor has any knowledge of, the occurrence or pendency or contemplation of any Extraordinary Receipts affecting all or any material portion of its property. No Mortgage encumbers improved Real Property that is located in an area that has been identified by the Secretary of Housing and Urban Development as an area having special flood hazards within the meaning of the National Flood Insurance Act of 1968 unless flood insurance has been obtained to the extent required by Section 7.4(c).

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(d) Collateral . The use by each of Holdings and each of the other Loan Parties of the Collateral does not infringe on the rights of any Person other than such infringement which could not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect.

SECTION 6.9

Environmental Matters .

(a) Except as set forth in Schedule 6.9 and except as, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect:

(i) Each Loan Party and each Subsidiary and their respective businesses, operations and Real Property are in compliance with, and the Loan Parties and their Subsidiaries have no liability under, Environmental Law;

(ii) The Loan Parties and their Subsidiaries have obtained all Environmental Permits required for the conduct of their respective businesses and operations, and the ownership, operation and use of their respective property, under Environmental Law, and all such Environmental Permits are valid and in good standing;

(iii) There has been no Release or threatened Release of Hazardous Material on, at, under or from any Real Property or facility presently or formerly owned, leased or operated by any Loan Party or any Subsidiary thereof or any of their respective predecessors in interest that could reasonably be expected to result in liability of any Loan Party or any Subsidiary thereof under Environmental Law;

(iv) There is no Environmental Claim pending or, to the knowledge of any of Holdings and its Subsidiaries, threatened against any Loan Party or any Subsidiary thereof, or relating to any Real Property currently or formerly owned, leased or operated by any Loan Party or any Subsidiary thereof or relating to the respective operations of any Loan Party or any Subsidiary thereof, and there are no actions, activities, circumstances, conditions, events or incidents that could reasonably be expected to form the basis of such an Environmental Claim; and

(v) No Person with an indemnity or contribution obligation to any Loan Party or any Subsidiary thereof relating to compliance with or liability under Environmental Law is in default with respect to such obligation.

(b)

Except as set forth in Schedule 6.9:

(i) None of the Loan Parties or any of their Subsidiaries is obligated to perform any action or otherwise incur any expense under Environmental Law pursuant to any order, decree, judgment or agreement by which it is bound or has assumed by contract or agreement, and no such entity is conducting or financing any Response pursuant to any Environmental Law with respect to any Real Property or any other location, except as, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect;

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(ii) As of the date hereof, no Real Property or facility owned, operated or leased by any Loan Party or any Subsidiary thereof and, to the knowledge of any of Holdings and its Subsidiaries, no Real Property or facility formerly owned, operated or leased by any Loan Party or any Subsidiary thereof or any of their respective predecessors in interest is (i) listed or formally proposed for listing on the National Priorities List promulgated pursuant to CERCLA, or (ii) listed on the Comprehensive Environmental Response, Compensation and Liability Information System promulgated pursuant to CERCLA or (iii) included on any similar list maintained by any Governmental Authority including any such list relating to petroleum;

(iii) As of the date hereof, no Lien has been recorded or, to the knowledge of any of Holdings and its Subsidiaries, threatened under any Environmental Law with respect to any owned real property or other assets of any Loan Party or any Subsidiary thereof;

(iv) The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby will not require any notification, registration, filing, reporting, disclosure, investigation, remediation or cleanup pursuant to any Governmental Real Property Disclosure Requirements or any other Environmental Law, except for those matters that, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect; and

(v) Holdings and its Subsidiaries have made available to the Lenders all material records and files in the possession, custody or control of, or otherwise reasonably available to, any of Holdings and its Subsidiaries concerning compliance with or liability under Environmental Law, including without limitation those concerning the Release or threatened Release of Hazardous Material at Real Property or facilities currently or formerly owned, operated, leased or used by any Loan Party or any Subsidiary thereof.

SECTION 6.10

Insurance .

(a) Each of Holdings and its Subsidiaries has insurance in such amounts and covering such risks and liabilities as are customary for companies of a similar size engaged in similar businesses in similar locations and as otherwise required by Section 7.4.

(b) All insurance maintained by Holdings and its Subsidiaries is in full force and effect, all premiums have been duly paid and none of Holdings or any of its Subsidiaries has received notice of violation or cancellation thereof.

SECTION 6.11

Taxes .

(a) The Loan Parties and their Subsidiaries have timely filed all material federal, state, provincial, foreign and other Tax returns and reports required to be filed, and have timely paid all material federal, state, provincial, foreign and other Taxes, assessments, fees and other governmental charges levied or imposed upon them or their properties, income or assets otherwise due and payable (whether or not shown on any Tax return), except those which are subject to Permitted Protests and for which no Lien has arisen as a result of the failure to pay same (other than a Permitted Lien). There is no proposed Tax assessment against any Loan Party or any Subsidiary thereof that, if made, could reasonably be expected to result in a Material

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Adverse Effect. With the exception of the Tax Sharing Agreement and the gross-up provisions applicable to employee payments in the ordinary course of business or contained in employment agreements, neither any Loan Party nor any Subsidiary thereof is party to any tax sharing agreement. Each Loan Party and each Subsidiary has made adequate provision in accordance with GAAP for all material Taxes not yet due and payable. Neither any Loan Party nor any Subsidiary has ever been a party to any understanding or arrangement constituting a "tax shelter" within the meaning of Section 6662(d)(2)(C)(iii) of the Code or within the meaning of Section 6111(c) or Section 6111(d) of the Code as in effect immediately prior to the enactment of the American Jobs Creation of 2004, or has ever "participated" in a "reportable transaction" within the meaning of Treas. Reg. Section 1.6011-4, except as could not be reasonably expected to, individually or in the aggregate, result in a Material Adverse Effect. Except any liabilities for Taxes of any consolidated, combined or unitary tax group of which Holdings is the common parent, neither any Loan Party nor any Subsidiary thereof has any liabilities for the Taxes of any Person under Treas. Reg. Section 1.1502-6 or any similar provision of state, local or foreign law, as a transferee or successor, by contract or otherwise, except as could not reasonably be expected to result in a Material Adverse Effect.

(b) Borrower, since its organization through calendar year 2006, was treated as a partnership within the meaning of Section 761(a) of the Code for Federal income tax purposes and was not an entity subject to Federal or state income tax (other than state income taxes generally imposed on partnerships). Neither such Loan Party nor any of its Subsidiaries has any knowledge of any inquiry or investigation by any Person (including, without limitation, the IRS) as to whether or not Borrower was, or any claim or assertion by any Person (including, without limitation, the IRS) that Borrower was not, a partnership for Federal or state income tax purposes or an entity subject to Federal or state income taxes (other than state income taxes generally imposed on partnerships). Subsequent to calendar year 2006, Borrower has been treated as a disregarded entity for Federal and state income tax purposes.

SECTION 6.12

ERISA Compliance .

(a) No ERISA Event has occurred or is reasonably expected to occur that, when taken together with all other such ERISA Events for which liability is reasonably expected to occur, could reasonably be expected to result in a Material Adverse Effect. Each of the Loan Parties and its Subsidiaries is in compliance in all material respects with the presently applicable provisions of ERISA, the Code and any other applicable Law with respect to each Employee Benefit Plan. The present value of all accumulated benefit obligations of all underfunded Pension Plans (based on the assumptions used for purposes of Statement of Financial Accounting Standards No. 87) did not, as of the date of the most recent audited financial statements of Holdings (the " Financial Statements Date "), exceed by more than $55,000,000 the fair market value of the assets of all such underfunded Pension Plans. Using actuarial assumptions and computation methods consistent with subpart 1 of subtitle E of Title IV of ERISA, the aggregate liabilities of the Loan Parties and the ERISA Affiliates to all Multiemployer Plans in the event of a complete withdrawal therefrom, as of the close of the most recent fiscal year of each such Multiemployer Plan, could not reasonably be expected to result in a Material Adverse Effect.

(b) Each Foreign Plan has been maintained in compliance with its terms and with the requirements of any and all applicable Laws and has been maintained, where required,

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in good standing with applicable regulatory authorities, in each case, except as could not reasonably be expected to result in material liability to a Loan Party or any of its Subsidiaries. Except as disclosed on Schedule 6.12(b), neither Holdings nor any of its Subsidiaries has incurred any material obligation in connection with the termination or withdrawal from any Foreign Plan. As of the most recent Financial Statements Date, the present value of the aggregate unfunded liability in respect of all Foreign Plans that are funded retirement plans did not exceed $5,000,000.

SECTION 6.13 Subsidiaries; Equity Interests . Except as disclosed to the Administrative Agent by Borrower in writing from time to time after the Closing Date, Holdings does not have any Subsidiaries other than those specifically disclosed in Schedule 6.13(a), and all of the outstanding Equity Interests in such Subsidiaries have been validly issued, are fully paid and nonassessable and are owned by a Loan Party in the amounts specified on Schedule 6.13(a) free and clear of all Liens, except the security interest created by the Security Agreement, the Prepetition Revolving Liens and the Prepetition Term Loan Liens and, after the Closing Date, Liens arising by operation of law constituting Permitted Liens. Except as disclosed to the Administrative Agent by Borrower in writing from time to time after the Closing Date, neither Holdings nor any of its Subsidiaries has any equity investments in any other corporation or entity other than those specifically disclosed in Schedule 6.13(b) or permitted under Section 7.15. All of the outstanding Equity Interests of Holdings have been validly issued. All Equity Interests of Borrower are owned directly or indirectly by Holdings and, as of the Closing Date, such Equity Interests are owned by Holdings and FMXI as set forth on Schedule 6.13(a). Each Loan Party is the record and beneficial owner of, and has good and defensible title to, the Equity Interests pledged by it under the Security Agreement, free of any and all Liens, rights or claims of other Persons, except the security interest created by the Security Agreement, the Prepetition Revolving Liens, the Prepetition Term Loan Liens and, after the Closing Date, Liens arising by operation of law constituting Permitted Liens, and as of the date hereof, there are no outstanding warrants, options or other rights to purchase, or shareholder, voting trust or similar agreements outstanding with respect to, or property that is convertible into, or that requires the issuance or sale of, any such Equity Interests. All Subsidiaries of Borrower existing on the Closing Date, other than the Foreign Subsidiaries, are Guarantors. All Subsidiaries of each Parent Company existing on the Closing Date, other than the Foreign Subsidiaries and Borrower, are Guarantors.

SECTION 6.14 Margin Regulations; Investment Company Act; Public Utility Holding Company Act .

(a) Neither Holdings nor any of its Subsidiaries is engaged or will engage, principally or as one of its important activities, in the business of purchasing or carrying Margin Stock, or extending credit for the purpose of purchasing or carrying Margin Stock. Following the application of the proceeds of the New Term Loans, not more than 25% of the value of the assets (either of Holdings only or of Holdings and its Subsidiaries on a consolidated basis) subject to the provisions of Section 7.14 or Section 7.18 or subject to any restriction contained in any agreement or instrument between Holdings or any of its Subsidiaries and any Lender or any Affiliate of any Lender relating to Indebtedness and within the scope of Section 9.1(e) will be Margin Stock.

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(b) No Loan Party (i) is a "holding company" or an "affiliate" of a "holding company" or a "subsidiary company" of a "holding company," as each such term is defined and used in the Public Utility Holding Company Act of 2005, enacted as part of the Energy Policy Act of 2005, Pub. L. No. 109-58 as codified at §§ 1261 et seq., and the regulations adopted thereunder, as amended, or (ii) is or is required to be registered as an "investment company" under the Investment Company Act of 1940.

SECTION 6.15 Disclosure . Each Loan Party has disclosed to the Administrative Agent and the Lenders all matters known to it that, individually or in the aggregate, could reasonably be expected to result in a Material Adverse Effect. No report, financial statement, certificate or other information furnished in writing by or on behalf of any Loan Party to the Administrative Agent or any Lender in connection with the transactions contemplated hereby and the negotiation of this Agreement or delivered hereunder or under any other Loan Document, as of the date such report, financial statement, certificate or other information was furnished, contained any material misstatement of fact or omitted to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading when taken as a whole; provided that, with respect to projected financial information, the Loan Parties represent only that such information was prepared in good faith based upon assumptions believed to be reasonable at the time.

SECTION 6.16 Compliance with Laws . Holdings and each of its Subsidiaries is in compliance with the requirements of all Laws and all orders, writs, injunctions and decrees applicable to it or to any of its properties, except in such instances in which (a) such applicable Law or order, writ, injunction or decree is being contested in good faith by appropriate proceedings diligently conducted or (b) the failure to comply therewith, either individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect.

SECTION 6.17

Intentionally Omitted .

SECTION 6.18 Intellectual Property Matters . Each Loan Party owns, or is licensed to use, all patents, patent applications, trademarks, trade names, service marks, copyrights, technology, trade secrets, proprietary information, domain names, know-how and processes necessary for the conduct of its business as currently conducted (the " Intellectual Property "), except for those the failure to own or license which, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect. To the knowledge of each Loan Party, no claim has been asserted and is pending by any Person challenging or questioning the use of any such Intellectual Property or the validity or effectiveness of any such Intellectual Property, nor to the knowledge of each Loan Party does the use of such Intellectual Property by each Loan Party infringe the rights of any Person, except for such claims and infringements that, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect.

SECTION 6.19 Security Interests . The Security Agreement is effective to create in favor of the Administrative Agent for the benefit of the Secured Parties, legal and valid Liens on, and security interests in, the U.S. Collateral and upon the entry of the Interim Order, the Liens created by each of the Security Agreement shall (to the extent provided therein) constitute

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perfected First Priority Liens (subject to Other Prepetition Liens and the Carve Out) on, and security interests in, all right, title and interest of the grantors in the U.S. Collateral.

SECTION 6.20 Use of Proceeds . Upon entry of the Interim Order, all proceeds of New Term Loans shall be used by Borrower for payment of such transaction costs and expenses related to the Chapter 11 Cases as permitted hereunder, for the ongoing working capital needs, general expenditures (including capital expenditures) and for general corporate purposes of Borrower and the Loan Parties as and to the extent permitted in the Cash Budget (subject to the variance permitted by Section 7.26). All proceeds of the Loans shall only be used in accordance with the Cash Budget, and for other expenditures set forth in the Cash Budget (subject to the variance permitted by Section 7.26). Notwithstanding anything herein to the contrary, no part of the proceeds of any New Term Loan will be used, directly or indirectly (A) to pay any fees or similar amounts to any Person who has proposed or may propose to purchase assets of or interests in Borrower or any other Loan Party or who otherwise has proposed or may propose to invest in Borrower or any Loan Party (including so-called "topping fees," "exit fees," and similar amounts); (B) except for up to $15,000 of proceeds of New Term Loans permitted to be used to investigate the Liens of or any claims by the "Lender" under the Prepetition First Lien Term Loan Facility, to finance in any way any action, suit, arbitration, proceeding, application, motion or other litigation of any type adverse to the interests of the Administrative Agent and the Lenders or their rights and remedies under this Agreement, the Loan Documents or the Financing Orders (including any claim under Chapter 5 of the Bankruptcy Code); (C) to make any payment of any claim, action or proceeding, before any court, arbitrator or other government body; (D) to pay any liabilities arising from the termination of any Plan, or (E) to reduce, terminate, or otherwise be applied to any Indebtedness of Borrower or any other Loan Party under the Prepetition Credit Agreements.

SECTION 6.21 FMXI . FMXI does not conduct any business other than the business of acting as the managing general partner of Borrower and owning its general partnership interest in Borrower. None of the Domestic Subsidiaries of Borrower conducts any business other than owning equity interests in other Domestic Subsidiaries or Foreign Subsidiaries as set forth on Schedule 6.13.

SECTION 6.22 Anti-Terrorism Law . No Loan Party and, to the knowledge of each of the Loan Parties, none of its Affiliates is in violation of any applicable law relating to terrorism or money laundering (" Anti-Terrorism Laws "), including Executive Order No. 13224 on Terrorist Financing, effective September 24, 2001 (the " Executive Order "), and the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, Public Law 107-56.

No Loan Party and, to the knowledge of each of the Loan Parties, no Affiliate or broker or other agent of any Loan Party acting or benefiting in any capacity in connection with any of the Loans is any of the following:

(i) a Person that is listed in the annex to, or is otherwise subject to the provisions of, the Executive Order;

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(ii) a Person owned or controlled by, or acting for or on behalf of, any person that is listed in the annex to, or is otherwise subject to the provisions of, the Executive Order;

(iii) a Person with which any Lender is prohibited from dealing or otherwise engaging in any transaction by any Anti-Terrorism Law;

(iv) a Person that commits, threatens or conspires to commit or supports "terrorism" as defined in the Executive Order; or

(v) a Person that is named as a "specially designated national and blocked person" on the most current list published by the U.S. Treasury Department Office of Foreign Assets Control (" OFAC ") at its official website or any replacement website or other replacement official publication of such list.

No Loan Party and, to the knowledge of each of the Loan Parties, no broker or other agent of any Loan Party acting in any capacity in connection with any of the Loans (i) conducts any business or engages in making or receiving any contribution of funds, goods or services to or for the benefit of any Person described in the immediately preceding paragraph, (ii) deals in, or otherwise engages in any transaction relating to, any property or interests in property blocked pursuant to the Executive Order, or (iii) engages in or conspires to engage in any transaction that evades or avoids, or has the purpose of evading or avoiding, or attempts to violate, any of the prohibitions set forth in any Anti-Terrorism Law.

SECTION 6.23

Intentionally Omitted .

SECTION 6.24 Trade Names; Jurisdiction of Organization; Location of Chief Executive Office; Organizational Identification Number . As of the Closing Date:

(a) all trade names or styles under which any Loan Party sells or expects to sell Inventory or create Accounts, or to which instruments in payment of Accounts are expected to be made payable, are listed on Schedule 6.24;

(b) the name of (within the meaning of Section 9-503 of the Code) and jurisdiction of organization of each Loan Party is set forth on Schedule 6.24; and

SECTION 6.25 Bank Accounts . Schedule 6.25 contains as of the Closing Date a complete and accurate list of all bank accounts maintained by any Loan Party with any bank or other financial institution including, with respect to such bank or financial institution (a) the name and address of such Person, and (b) the account numbers of the bank accounts maintained with such Person.

SECTION 6.26

Reorganization Matters .

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(a) Borrower shall give, on a timely basis as specified in the Interim Order and the Final Order, as the case may be, all notices required to be given to all parties specified in the Interim Order and the Final Order, as the case may be.

(b) After the entry of the Interim Order, and pursuant to and to the extent permitted in the Interim Order, the Obligations will constitute allowed administrative expense claims in the Chapter 11 Cases having priority over all administrative expense claims, secured, and unsecured claims against Borrower and each of the other Loan Parties now existing or hereafter arising, of any kind whatsoever, including, without limitation, all administrative expense claims of the kind specified in Sections 105, 326, 328, 330, 331, 503(b), 506(c), 507(a), 507(b), 546(c), 726, 1114 or any other provision of the Bankruptcy Code, as provided under the Section 364(c)(1) of the Bankruptcy Code, subject as to priority only to the Carve Out and Other Prepetition Liens.

(c) After the entry of the Interim Order and pursuant to, and to the extent provided in, the Interim Order, the Obligations will be secured by a valid and perfected First Priority Lien on the U.S. Collateral, subject to no prior Liens other than Other Prepetition Liens and the Carve Out.

(d) The Interim Order (with respect to the period prior to the entry of the Final Order) is in full force and effect and has not been reversed, stayed, vacated, modified or amended.

(e) Notwithstanding the provisions of Section 362 of the Bankruptcy Code, upon the maturity (whether by acceleration or otherwise) of any of the Obligations, the Administrative Agent and Lenders shall be entitled to immediate payment of such Obligations and to enforce the remedies provided for hereunder, without further application to or order by the Bankruptcy Court.

SECTION 6.27 Transfers . No transfer of property is being made by any Loan Party and no obligation is being incurred by any Loan Party in connection with the transactions contemplated by this Agreement or the other Loan Documents with the intent to hinder, delay, or defraud either present or future creditors of such Loan Party.

ARTICLE VII

AFFIRMATIVE AND NEGATIVE COVENANTS

So long as any of the Obligations (other than Contingent Obligations at Termination) remain outstanding or this Agreement is in effect:

SECTION 7.1 Payment of Taxes . Each Loan Party shall, and shall cause each of its Subsidiaries to, pay in full, all Taxes when due except to the extent the validity of such Tax shall be the subject of a Permitted Protest and each Loan Party will, and will cause each of its Subsidiaries, to timely and correctly file all Tax returns required by Law. Borrower will and will cause each of its Subsidiaries to make timely payment or deposit of all tax payments and withholding taxes required of it and them by applicable Laws, including those laws concerning F.I.C.A., F.U.T.A., state disability, and local, state, and federal income taxes, and will, upon

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request, furnish the Administrative Agent with proof reasonably satisfactory to the Administrative Agent and the Majority Lenders indicating that Borrower and its Subsidiaries have made such payments or deposits.

SECTION 7.2 Preservation of Existence, Etc . Except as otherwise expressly permitted under Section 7.17 or Section 7.18, each Loan Party shall, and shall cause each of its Subsidiaries to, do or cause to be done all things necessary to preserve, renew and maintain in full force and effect its (a) legal existence and (b) qualification and good standing in all jurisdictions in which the failure to maintain such qualification or good standing could reasonably be expected to result in a Material Adverse Effect. Borrower shall not change its partnership status to a corporate status.

SECTION 7.3 Maintenance of Properties . Each Loan Party shall, and shall cause each of its Subsidiaries to, do or cause to be done all things reasonably necessary to obtain, preserve, renew, extend and keep in full force and effect the rights, licenses, permits, privileges, franchises, authorizations, patents, copyrights, trademarks and trade names necessary to the conduct of its business and at all times maintain, preserve and protect all tangible property necessary to the conduct of such business and keep such property in good repair, working order and condition (other than wear and tear occurring in the ordinary course of business); provided that nothing in this Section 7.3 shall prevent the consummation of any Permitted Disposition.

SECTION 7.4

Maintenance of Insurance .

(a) Generally . Each Loan Party shall, and shall cause each of its Subsidiaries to, maintain insurance by financially sound and reputable insurers to such extent and against such risks as is customary with companies in the same or similar businesses operating in the same or similar locations, including insurance with respect to Mortgaged Properties and other properties material to the business of such Loan Party or any Subsidiary against such casualties and contingencies and of such types and in such amounts with such deductibles as is customary in the case of similar businesses operating in the same or similar locations.

(b) Requirements of Insurance . All such insurance shall (i) provide that no cancellation, material reduction in amount or material change in coverage thereof shall be effective until at least 30 days (or 10 days for nonpayment of premiums) after receipt by the Administrative Agent of written notice thereof, (ii) name the Administrative Agent as additional insured on behalf of the Secured Parties (in the case of liability insurance) and loss payee (in the case of property insurance), as applicable, and (iii) be reasonably satisfactory in all other respects to the Administrative Agent and the Majority Lenders.

(c) Flood Insurance . Each Loan Party shall, with respect to each Mortgaged Property, obtain flood insurance in such total amount as the Administrative Agent or the Majority Lenders may from time to time reasonably require, except that such total amount shall not exceed the principal amount of outstanding Indebtedness from time to time secured by such Mortgaged Property, if at any time the area in which any improvements are located on any Mortgaged Property is designated a "flood hazard area" in any Flood Insurance Rate Map published by the Federal Emergency Management Agency, and otherwise comply with the

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National Flood Insurance Program as set forth in the Flood Disaster Protection Act of 1973, as amended from time to time.

(d) Broker's Report . Borrower shall deliver to the Administrative Agent and the Lenders a summary report of a reputable insurance broker with respect to such insurance and such supplemental reports with respect thereto as the Administrative Agent or the Majority Lenders may from time to time reasonably request.

(e) Mortgaged Properties . No Loan Party that is an owner of Mortgaged Property shall take any action that is reasonably likely to be the basis for termination, revocation or denial of any insurance coverage required to be maintained under such Loan Party's respective Mortgage or that could be the basis for a defense to any material claim under any Insurance Policy maintained in respect of the Premises, and each Loan Party shall otherwise comply in all material respects with all Insurance Requirements in respect of the Premises; provided that each Loan Party may, at its own expense and after written notice to the Administrative Agent, (i) contest the applicability or enforceability of any such Insurance Requirements by appropriate legal proceedings, the prosecution of which does not constitute a basis for cancellation or revocation of any insurance coverage required under this Section 7.4 or (ii) cause the Insurance Policy containing any such Insurance Requirement to be replaced by a new policy complying with the provisions of this Section 7.4.

SECTION 7.5 Compliance with Laws . Each Loan Party shall, and shall cause each of its Subsidiaries to, comply with the requirements of all Laws and all orders, writs, injunctions and decrees applicable to it or to its business or property, except in such instances in which (a) such applicable Law or order, writ, injunction or decree is being contested in good faith by appropriate proceedings diligently conducted or is stayed as a result of the Chapter 11 Cases; or (b) the failure to comply therewith could not reasonably be expected to have a Material Adverse Effect.

SECTION 7.6 Books and Records . Each Loan Party shall (a) maintain proper books of record and account, in which full, true and correct entries in conformity with GAAP consistently applied shall be made of all financial transactions and matters involving the assets and business of such Loan Party; and (b) maintain such books of record and account in material conformity with all applicable requirements of any Governmental Authority having regulatory jurisdiction over such Loan Party. Each Loan Party shall maintain at all times books and records pertaining to the Collateral in which it has an interest in such detail, form and scope as the Administrative Agent or the Majority Lenders shall reasonably require, including, but not limited to, records of (a) all payments received and all credits and extensions granted with respect to Accounts and (b) all other dealings affecting the Collateral in which it has an interest; provided, that if a Loan Party is required by GAAP or by the Administrative Agent or the Majority Lenders pursuant to this sentence to make a change to its books and records pertaining to its Collateral, such Loan Party shall have a reasonable amount of time to implement such change.

SECTION 7.7 Inspection Rights . Each Loan Party shall (i) permit representatives and independent contractors of the Administrative Agent or any Lender to visit and inspect any of its properties, to examine its corporate, financial and operating records, and make copies thereof or abstracts therefrom, and to discuss its affairs, finances and accounts with

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its directors (or Persons serving a similar function), officers and independent public accountants and in each case at such reasonable times during normal business hours and, subject to the limitations above, as often as may be reasonably desired, upon reasonable advance notice to Borrower (provided, however, when an Event of Default exists, the Administrative Agent and any Lender may do any of the foregoing at the expense of the Loan Parties at any time during normal business hours and without advance notice) and (ii) conduct a conference call with the Lenders, at the request of the Administrative Agent or the Majority Lenders, at least once per week during normal business hours upon reasonable advance notice to Borrower. Any amounts payable by the Loan Parties to the Administrative Agent or any Lender pursuant to this Section 7.7 shall be the joint and several obligations of each of the Loan Parties.

SECTION 7.8 Use of Proceeds . Upon entry of the Interim Order, all proceeds of New Term Loans shall be used by Borrower as provided in Section 6.20.

SECTION 7.9 Compliance with Environmental Laws . Each Loan Party shall, and shall cause each Subsidiary to:

(a) Comply, and cause all lessees and other Persons occupying Real Property of any Loan Party to comply, in all material respects with all Environmental Laws and Environmental Permits applicable to its operations and Real Property; obtain and renew all material Environmental Permits applicable to its operations and Real Property; and conduct all Responses required by, and in accordance in all material respects with, Environmental Laws; provided that no Loan Party shall be required to undertake any Response to the extent that its obligation to do so is being contested in good faith and by proper proceedings diligently conducted and appropriate reserves are being maintained with respect to such circumstances in accordance with GAAP.

(b) If a Default caused by reason of a breach of Section 6.9 or Section 7.9(a) shall have occurred and be continuing for more than 30 days, at the written request of the Administrative Agent or the Majority Lenders through the Administrative Agent, provide to the Administrative Agent and the Lenders within 45 days after such request, at the expense of the Loan Parties, an environmental assessment report regarding the matters which are the subject of such Default, including, where appropriate, soil and/or groundwater sampling, prepared by an environmental consulting firm, and in a form and substance, reasonably acceptable to the Majority Lenders and indicating the presence or absence of Hazardous Materials and the estimated cost of any compliance or Response required by Environmental Laws to address them.

SECTION 7.10 Additional Collateral; Additional Guarantors . At any time upon the reasonable request of the Administrative Agent or the Majority Lenders, each Loan Party shall execute or deliver to the Administrative Agent any and all financing statements, fixture filings, security agreements, pledges, assignments, endorsements of certificates of title, mortgages, deeds of trust, opinions of counsel, and all other documents (collectively, the " Additional Documents ") that the Majority Lenders may reasonably request in form and substance satisfactory to the Majority Lenders, to create, perfect, and continue perfected or to better perfect the Administrative Agent's Liens in the Collateral of the Loan Parties (whether now owned or hereafter arising or acquired, tangible or intangible, real or personal), to create and perfect Liens in favor of the Administrative in any Real Property, and in order to fully

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consummate all of the transactions contemplated hereby and under the other Loan Documents; provided that the foregoing shall not apply to any Subsidiary of Borrower if providing such documents would result in adverse tax consequences as determined by the Majority Lenders in their reasonable discretion. To the maximum extent permitted by applicable law, Borrower authorizes the Administrative Agent to file such executed Additional Documents in any appropriate filing office. In furtherance and not in limitation of the foregoing, each Loan Party shall take such actions as the Administrative Agent or the Majority Lenders may reasonably request from time to time to ensure that the Obligations are guarantied by the Guarantors and are secured by the Collateral.

SECTION 7.11

Intentionally Omitted .

SECTION 7.12

Information Regarding Collateral .

(a) No Loan Party shall effect any change (i) in such Loan Party's legal name, (ii) in the location of such Loan Party's chief executive office or legal domicile, (iii) in such Loan Party's identity or organizational structure, (iv) in such Loan Party's organizational identification number, if any, or (v) in such Loan Party's jurisdiction of organization (in each case, including by merging or amalgamating with or into any other entity, reorganizing, dissolving, liquidating, reorganizing or organizing in any other jurisdiction). Each Loan Party also agrees to promptly notify the Administrative Agent of any change in the location of any office in which it maintains books or records relating to Collateral owned by it or any office or facility at which Collateral in excess of $1,000,000 in value is located (including the establishment of any such new office or facility), other than changes in location to a Mortgaged Property or a leased property subject to a Landlord Access Agreement.

(b) Each Loan Party shall deliver to the Administrative Agent, upon reasonable request, such information reasonably deemed by the Majority Lenders necessary to obtain or maintain (to the extent provided in the applicable Loan Document) a valid, perfected First Priority Lien (subject to Other Prepetition Liens and the Carve Out) on any Collateral acquired after the Closing Date.

SECTION 7.13

Other Affirmative Covenants .

(a) With respect to each Lease for which any Loan Party holds the lessor's or sublessor's interest (other than Leases rejected by the Loan Parties during the Chapter 11 Cases with the approval of the Majority Lenders), such Loan Party shall perform all the obligations imposed upon the lessor or sublessor, as the case may be, under such Lease and enforce all of the lessee's or sublessee's, as the case may be, obligations thereunder, except where the failure to so perform or enforce could not reasonably be expected to result in a Material Adverse Effect.

(b) Promptly and in no event later than 5 Business Days after obtaining knowledge thereof, notify the Administrative Agent if any written information, exhibit, or report furnished to the Lenders contained, at the time it was furnished, any untrue statement of a material fact or omitted to state any material fact necessary to make the statements contained therein not misleading in light of the circumstances in which made when taken as a whole with all other information so furnished. The foregoing to the contrary notwithstanding, any

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notification pursuant to the foregoing provision will not cure or remedy the effect of the prior untrue statement of a material fact or omission of any material fact nor shall any such notification have the effect of amending or modifying this Agreement or any of the Schedules hereto.

(c) Each Loan Party will comply with the Financing Orders and each of the other orders entered into by the Bankruptcy Court.

(d) Borrower will complete the actions set forth on Schedule 7.13 within the time periods set forth therein.

(e) Borrower agrees to use all reasonable efforts to assist MP in the preparation and negotiation of the APA including providing MP timely access to facilities, timely delivery of requested due diligence items and making available requested members of senior management, advisors and other personnel of Borrower or Holdings

(f) No Loan Party shall create or acquire, or permit any of its Subsidiaries to create or acquire, any new Subsidiaries.

SECTION 7.14 Liens . Each of the Loan Parties shall not, and shall not permit any Subsidiary to, create, incur, assume or suffer to exist any Lien upon any of its assets (other than Unencumbered Property), whether now owned or hereafter acquired, other than Permitted Liens. Permitted Liens, other than Other Prepetition Liens and the Carve Out, shall at all times be junior and subordinate to the security interests and liens under the Loan Documents, the Interim Order and the Final Order. None of the Loan Parties shall, or permit any Subsidiary to, create, incur, assume or suffer to exist any Lien upon any Unencumbered Property, whether now owned or hereafter acquired, other than Liens arising in the ordinary course of business and by operation of law which secure amounts (other than amounts for borrowed money) which are not delinquent or are subject to Permitted Protests.

SECTION 7.15 Investments; Bank Accounts . No Loan Party shall make any Investments except Permitted Investments. No Loan Party shall have Permitted Investments consisting of cash, Cash Equivalents, or amounts credited to deposit accounts or securities accounts unless Borrower or its Subsidiary, as applicable, and the applicable securities intermediary or bank have entered into control agreements with the Administrative Agent governing such Permitted Investments in order to perfect (and further establish) the Administrative Agent's Liens in such Permitted Investments in accordance with the timelines set forth on Schedule 7.13. Borrower and, upon becoming a Loan Party hereunder, Foamex Canada, shall not and shall not permit its Subsidiaries to establish or maintain any deposit account (excluding payroll accounts) or securities account unless the Administrative Agent shall have received a control agreement in respect of such deposit account or securities account in accordance with the timelines set forth on Schedule 7.13.

SECTION 7.16 Indebtedness . Each of the Loan Parties shall not, and shall not permit any of its Subsidiaries to, create, incur, assume or suffer to exist any Indebtedness except Permitted Indebtedness. Notwithstanding the foregoing, no Permitted Indebtedness (other than clause (a) of the definition of Permitted Indebtedness) shall be permitted to have an

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administrative expense claim under the Bankruptcy Code senior to or pari passu with the superpriority administrative expense claims of the Administrative Agent and the Lenders as set forth herein and in the Interim Order and the Final Order.

SECTION 7.17 Fundamental Changes . Each of the Loan Parties shall not, and shall not permit any Subsidiary to, merge, amalgamate, dissolve, liquidate or consolidate with or into another Person, or dispose of (whether in one transaction or in a series of transactions) all or substantially all of its assets (whether now owned or hereafter acquired) to or in favor of any Person, except that, so long as no Event of Default exists or would result therefrom:

(a) any Subsidiary of Borrower may merge, amalgamate or consolidate with (i) Borrower so long as Borrower shall be the continuing or surviving Person and (ii) any other Subsidiary of Borrower that is also a Debtor (a " Subsidiary Debtor ") so long as a Subsidiary Debtor shall be the continuing or surviving Person;

(b) any Subsidiary may consummate a merger, amalgamation, consolidation or disposition, the purpose of which is to effect the MP Sale; and

(c) any Subsidiary may dispose of all or substantially all of its assets (upon voluntary liquidation, dissolution or otherwise) in one or a series of transactions to Borrower.

SECTION 7.18 Disposal of Assets . Other than Permitted Dispositions, Permitted Investments, or transactions expressly permitted under the Loan Documents, no Loan Party shall, or permit any of its Subsidiaries to, convey, sell, lease, license, assign, transfer, issue or otherwise dispose of (or enter into an agreement to convey, sell, lease, license, assign, transfer, issue or otherwise dispose of) any of its assets without the prior written consent of the Majority Lenders. Notwithstanding the foregoing, in the case of the MP Sale or any 363 Sale consented to by the Majority Lenders, the consent of the Administrative Agent shall also be required prior to the consummation of such sale if (a) the proceeds of such sale are insufficient to satisfy in full the LC Obligations and the Secured Swap Obligations then outstanding and (b) the proceeds of such sale are not used to pay or otherwise satisfy in full the LC Obligations and the Secured Swap Obligations then outstanding, in each case, upon the consummation of such sale.

SECTION 7.19 Restricted Payments . Each of the Loan Parties shall not, and shall not permit any Subsidiary to, declare or make, directly or indirectly, any Restricted Payment, except each Subsidiary of Borrower may make Restricted Payments to Borrower or any Subsidiary Guarantor.

SECTION 7.20

Change in Nature of Business.

(a) Holdings shall not, and shall not permit any other Parent Company to, (i) own any properties, other than its direct or indirect ownership of the Equity Interests of its Subsidiaries or (ii) engage in any business or operations other than those incidental to its direct or indirect ownership of the Equity Interests of its Subsidiaries, provided that, subject to the Interim Order and the Final Order, a Parent Company may engage in those activities that are incidental to (A) the maintenance of its corporate existence in compliance with applicable law, (B) legal, tax and accounting matters in connection with any of the foregoing or following activities, (C) the filing of registration statements, and compliance with applicable reporting and

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other obligations, under federal, state or other securities laws, (D) the retention of (and the entry into, and exercise of rights and performance of obligations in respect of, contracts and agreements with) counsel, accountants and other advisors and consultants in connection with the Chapter 11 Cases, (E) the performance of obligations under and compliance with its Organization Documents or any applicable law, ordinance, regulation, rule, order, judgment, decree or permit, including as a result of or in connection with the activities of its Subsidiaries or any other transaction or activity expressly permitted under the Loan Documents or (F) the incurrence and payment of its operating and business expenses and any Taxes for which it may be liable in accordance with the Cash Budget. Holdings shall not permit the existence of any Parent Company other than Holdings and FMXI without the prior written consent of the Majority Lenders.

(b) Borrower shall not, and shall not permit any of its Subsidiaries to, engage (directly or indirectly) in any business other than those businesses in which it is engaged on the Closing Date (or which are reasonably related thereto or are reasonable extensions thereof).

SECTION 7.21 Transactions with Affiliates . Each of the Loan Parties shall not, and shall not permit any Subsidiary to, enter into, directly or indirectly, any transaction or series of related transactions, whether or not in the ordinary course of business, with or for the benefit of any Affiliate, other than on terms and conditions not materially less favorable to such Loan Party or Subsidiary as would reasonably be obtained by such Loan Party or Subsidiary at that time in an arm's-length transaction with a Person other than an Affiliate or as listed on Schedule 7.21.

SECTION 7.22

Intentionally Omitted .

SECTION 7.23 Clauses Restricting Subsidiary Distributions . No Loan Party shall enter into or suffer to exist or become effective any consensual encumbrance or restriction on the ability of any Subsidiary of Borrower to (a) make Restricted Payments in respect of any Capital Stock of such Subsidiary held by, or pay any Indebtedness owed to, Borrower or any Subsidiary Guarantor or (b) make Permitted Investments in, Borrower or any Subsidiary Guarantor, except for such encumbrances or restrictions existing under or by reason of the Loan Documents or existing prior to the Closing Date.

SECTION 7.24 Market Regulations . No Loan Party shall use the proceeds of any Loans, whether directly or indirectly, and whether immediately, incidentally or ultimately, to purchase or carry Margin Stock or to extend credit to others for the purpose of purchasing or carrying Margin Stock or to refinance indebtedness originally incurred for such purpose.

SECTION 7.25 Minimum EBITDA . As at the end of any fiscal month, beginning with the fiscal month ending March 31, 2009, the Borrower shall not, without the prior written consent of the Majority Lenders in their sole discretion in each instance, permit Consolidated EBITDA for the three fiscal month period then ended to be less than the correlative amount indicated on Annex B attached hereto.

SECTION 7.26 Maximum Capital Expenditures . As at the end of any week and subject to the following sentence, the Borrower shall not, without the prior written consent of the

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Majority Lenders in their sole discretion in each instance, permit the aggregate amount of Capital Expenditures of the Debtors made during such weekly period to the product of (x) the amount set forth in the Cash Budget (after taking into account approved updates) for such weekly period multiplied by (y) 110% (the " Weekly Capital Expenditure Allowance "). Notwithstanding the foregoing, if any amount of the Weekly Capital Expenditure Allowance is not used in any week, such unused amount may be used in any subsequent week.

SECTION 7.27 Modifications of Organization Documents and Other Documents, Prepayment of Subordinated Indebtedness, Etc . No Loan Party shall directly or indirectly:

(a) amend or modify, or permit the amendment or modification of, any provision of any Indebtedness of any Loan Party or the Tax Sharing Agreement, in each case in any manner that is adverse in any material respect to the interests of the Lenders;

(b) terminate, amend, modify or change any of its Organization Documents (including (x) by the filing or modification of any certificate of designation or (y) any election (to treat any Pledged Interests (as defined in the Security Agreement) as a "security" under Section 8-103 of the UCC other than concurrently with the delivery of certificates representing such Pledged Interests or a control agreement to the Administrative Agent) or any agreement to which it is a party with respect to its Equity Interests (including any stockholders' agreement), other than any amendments, modification or changes which are not adverse in any respect to the interest of the Swap Provider, LC Lenders or New Term Lenders;

(c) make any voluntary or optional payment or prepayment on or redemption or acquisition for value of, or any prepayment or redemption as a result of any asset sale, change of control or similar event of, any Subordinated Indebtedness or any Prepetition Indebtedness; or

(d) amend, modify, supplement, waive compliance with or consent to any departure from any provision of any Prepetition Revolving Loan Document, Prepetition First Lien Term Loan Document or Prepetition Second Lien Term Loan Document.

SECTION 7.28 Change in Fiscal Year; Recording of Accounts . No Loan Party shall make any change in its fiscal year or any material change in the manner in which it records any Accounts on its books and records (including as to when a sale of Inventory or rendition of services on credit becomes an Account).

SECTION 7.29

Anti-Terrorism Law; Anti-Money Laundering .

(a) No Loan Party shall, or shall permit any of its Subsidiaries to, directly or indirectly (i) knowingly conduct any business or engage in making or receiving any contribution of funds, goods or services to or for the benefit of any Person described in Section 6.22, (ii) knowingly deal in, or otherwise engage in any transaction relating to, any property or interests in property blocked pursuant to the Executive Order or any other Anti-Terrorism Law, or (iii) knowingly engage in or conspire to engage in any transaction that evades or avoids, or has the purpose of evading or avoiding, or attempts to violate, any of the prohibitions set forth in any Anti-Terrorism Law (and the Loan Parties shall deliver to the Lenders any certification or other

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evidence requested from time to time by any Lender in its reasonable discretion, confirming the Loan Parties' compliance with this Section 7.29).

(b) No Loan Party shall knowingly cause or permit any of the funds of such Loan Party that are used to repay any Loans to be derived from any unlawful activity with the result that the making of any Loans would be in violation of any applicable law.

SECTION 7.30 Embargoed Person . No Loan Party shall knowingly cause or permit (a) any of the funds or properties of any of the Loan Parties that are used to repay any Loans to constitute property of, or be beneficially owned directly or indirectly by, any Person subject to sanctions or trade restrictions under United States law (" Embargoed Person " or " Embargoed Persons ") that is identified on (1) the "List of Specially Designated Nationals and Blocked Persons" maintained by OFAC and/or on any other similar list maintained by OFAC pursuant to any authorizing statute including, but not limited to, the International Emergency Economic Powers Act, 50 U.S.C. §§ 1701 et seq., The Trading with the Enemy Act, 50 U.S.C. App. 1 et seq., and any Executive Order or applicable law promulgated thereunder, with the result that the investment in any Loan Parties (whether directly or indirectly) is prohibited by applicable law, or any Loans made by the Lenders would be in violation of applicable law, or (2) the Executive Order, any related enabling legislation or any other similar Executive Orders or (b) any Embargoed Person to have any direct or indirect interest, of any nature whatsoever in any of the Loan Parties, with the result that any investment in any of the Loan Parties (whether directly or indirectly) is prohibited by applicable law or any of the Loans are in violation of applicable law.

SECTION 7.31

Intentionally Omitted .

SECTION 7.32 Acquisitions . No Loan Party shall purchase or otherwise acquire (in one or a series of related transactions) any assets constituting a business unit or division or line of business of, or Equity Interests representing a majority of the outstanding Equity Interests or voting power of the Voting Stock of, any Person (or agree to do any of the foregoing at any future time).

SECTION 7.33 Minimum Net Availability . As at the end of any week, beginning on the week ended February 27, 2009 the Borrower shall not, without the prior written consent of the Majority Lenders in their sole discretion in each instance, permit the Net Availability for the week then ended to be less than the correlative amount indicated on Annex B attached hereto.

SECTION 7.34 Applications to Bankruptcy Court . No Loan Party shall apply to the Bankruptcy Court for authority to take any action prohibited by this Article VII (except to the extent such application and the taking of such action is conditioned upon the receiving the written consent of the Administrative Agent and the Majority Lenders).

ARTICLE VIII

CONDITIONS OF LENDING

SECTION 8.1 Conditions Precedent - Closing Date . The obligation of the Lenders to make the New Term Loans on the Closing Date, the obligation of the Administrative

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Agent to cause the Letter of Credit Issuer to issue any Letter of Credit on the Closing Date and the rollover of the Prepetition Swap Contracts to Secured Swap Obligations, are, in each case, subject to the following conditions precedent having been satisfied in a manner satisfactory to the Administrative Agent and each Lender:

(a) Loan and Corporate Documents; Certificates . The Administrative Agent's receipt of the following, each of which shall be originals or facsimiles (followed promptly by originals) unless otherwise specified, each, if applicable, properly executed by a duly authorized officer of the signing Loan Party, each dated the Closing Date (or, in the case of certificates of governmental officials, a recent date before the Closing Date) and each in form and substance reasonably satisfactory to the Administrative Agent and the Majority Lenders:

(i) executed counterparts of this Agreement and each other Loan Document (other than Loan Documents listed on Schedule 7.13 and the Final Order);

(ii) such certificates of resolutions or other action, incumbency certificates and/or other certificates of duly authorized officers of each Loan Party as the Administrative Agent or the Majority Lenders may reasonably require evidencing the identity, authority and capacity of each duly authorized officer thereof authorized to act in connection with this Agreement and the other Loan Documents to which such Loan Party is a party;

(iii) such documents and certifications as the Administrative Agent or the Majority Lenders may reasonably require to evidence that each Loan Party is duly organized or formed, is validly existing, in good standing and qualified to engage in business in each jurisdiction where its ownership, lease or operation of properties or the conduct of its business requires such qualification; provided that the failure to deliver evidence of foreign qualification shall not limit each Lender from making its Loans on the Closing Date;

(iv) a certificate signed by a Responsible Officer of Borrower certifying (A) that the conditions specified in Sections 8.1(d) and (e) have been satisfied and (B) that there has been no event or circumstance since the date of the Holdings' most recent audited financial statements that has had or could be reasonably expected to have, either individually or in the aggregate, a Material Adverse Effect other than those events which customarily occur as a result of events leading up to the commencement of a proceeding under Chapter 11 of the Bankruptcy Code;

(v) the receipt by the Administrative Agent and the Lenders of the Cash Budget;

(vi) the receipt by the Administrative Agent and the Lenders of the Closing Date Projections;

(vii) the receipt by the Administrative Agent and the Lenders of a report in form reasonably satisfactory to the Majority Lenders and the Administrative Agent reflecting the historical total weekly sales and volumes of each business unit of Borrower and its consolidated Subsidiaries, for the period from the week ending October 2, 2008 through week ending immediately prior to the Closing Date; and

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(viii) a Notice of Borrowing relating to the New Term Loans to be made on the Closing Date.

(b) Litigation . No litigation shall be pending or threatened against any Loan Party with respect to the Loan Documents or the definitive documentation in respect of the Loan Documents or which could reasonably be expected to have a Material Adverse Effect. There shall not exist any judgment, order, injunction or other restraint prohibiting the execution and delivery of the Loan Documents or which could reasonably be expected to have a Material Adverse Effect.

(c) Fees and Expenses . All accrued fees and expenses of the Administrative Agent and the Lenders (including the fees and expenses of Bracewell & Giuliani LLP and of local Delaware counsel for the Lenders) shall have been paid.

(d) Representations . The representations and warranties of Borrower and each other Loan Party contained in Article 6 or in any other Loan Document, or which are contained in any document furnished at any time under or in connection herewith or therewith, shall be true and correct in all material respects on and as of the Closing Date, except to the extent that any such representations and warranties specifically refer to an earlier date, in which case they shall be true and correct in all material aspects as of such earlier date.

(e) No Default . No Default or Event of Default shall have occurred and be continuing, or would result from the proposed borrowing of the New Term Loans or issuance of Letters of Credit on the Closing Date or from the application of the proceeds thereof.

(f) Interim Order . The Interim Order shall have been entered by the Bankruptcy Court, which Interim Order shall have been entered on such prior notice to such parties in accordance with Bankruptcy Rule 4001 (as determined by the Administrative Agent and the Majority Lenders), and the Administrative Agent shall have received a copy of same, and such order shall be in full force and effect and shall not have been (i) stayed, vacated, revised or rescinded or (ii) without the prior written consent of the Administrative Agent and the Majority Lenders, in their sole discretion, amended or modified.

(g) First Day Orders . All "First Day Orders" or other orders entered or to be entered at the time of the Filing Date shall be satisfactory in form and substance to the Administrative Agent and the Majority Lenders in all respects.

The acceptance by Borrower of any New Term Loans made or any Letters of Credit issued on or after the Closing Date shall be deemed to be a representation and warranty made by Borrower to the effect that all of the conditions precedent to the making of such New Term Loans or the issuance of such Letters of Credit have been satisfied, with the same effect as delivery to the Administrative Agent and the Lenders of a certificate signed by a Responsible Officer of Borrower, dated the Closing Date, to such effect.

Execution and delivery to the Administrative Agent by a Lender of a counterpart of this Agreement shall be deemed confirmation by such Lender that (i) all conditions precedent in this Section 8.1 have been fulfilled to the satisfaction of such Lender, (ii) the decision of such Lender to execute and deliver to the

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