SECOND AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT

TABLE OF CONTENTS

This Second Amended and Restated Loan and Security Agreement dated as of September 19, 2008 (this “ Agreement ”) is entered into by and among Jazz Semiconductor, Inc., a Delaware corporation (“ Jazz ” as hereinafter further defined), Newport Fab, LLC (d/b/a Jazz Semiconductor Operating Company), a Delaware limited liability company (“ Operating Company ” as hereinafter further defined, and Operating Company together with Jazz, collectively, the “ Borrowers ” and each of them individually, a “ Borrower ” as hereinafter further defined), Jazz Technologies, Inc., formerly known as Acquicor Technology Inc., a Delaware corporation (“ Parent Guarantor ” and together with its successors (whether by merger or operation of law) and any other Person that at any time after the Effective Date becomes a Guarantor, each individually a “ Guarantor ” and collectively, “ Guarantors ” as hereinafter further defined), the parties hereto from time to time as lenders, whether by execution of this Agreement or an Assignment and Acceptance (each individually, a “ Lender ” and collectively, “ Lenders ” as hereinafter further defined), Wachovia Capital Markets, LLC, as lead arranger, bookrunner and syndication agent (“ Syndication Agent ”), and Wachovia Capital Finance Corporation (Western), a California corporation (“ Agent ” as hereinafter further defined).

SECTION 1.   DEFINITIONS

1.1   “ Accounts ” shall mean, as to each Borrower and Guarantor, all present and future rights of such Borrower and Guarantor to payment of a monetary obligation, whether or not earned by performance, which is not evidenced by chattel paper or an instrument, (a) for property that has been or is to be sold, leased, licensed, assigned, or otherwise disposed of, (b) for services rendered or to be rendered, (c) for a secondary obligation incurred or to be incurred, or (d) arising out of the use of a credit, charge or debit card or information contained on or for use with such card.

1.2   “ Accounts Sublimit ” shall mean, at any time, the amount equal to $25,000,000, as reduced by any reduction thereof pursuant to Section 2.1(c) hereof.

1.3   “ Act ” shall have the meaning set forth in Section 13.9 hereof.

1.4   “ Adjusted Eurodollar Rate ” shall mean, with respect to each Interest Period for any Eurodollar Rate Loan comprising part of the same borrowing (including conversions, extensions and renewals), the rate per annum determined by dividing (a) the London Interbank Offered Rate for such Interest Period by (b) a percentage equal to: (i) one (1) minus (ii) the Reserve Percentage. For purposes hereof, “Reserve Percentage” shall mean for any day, that percentage (expressed as a decimal) which is in effect from time to time under Regulation D of the Board of Governors of the Federal Reserve System (or any successor), as such regulation may be amended from time to time or any successor regulation, as the maximum reserve requirement (including, without limitation, any basic, supplemental, emergency, special, or marginal reserves) applicable with respect to Eurocurrency liabilities as that term is defined in Regulation D (or against any other category of liabilities that includes deposits by reference to which the interest rate of Eurodollar Rate Loans is determined), whether or not any Lender has any Eurocurrency liabilities subject to such reserve requirement at that time. Eurodollar Rate Loans shall be deemed to constitute Eurocurrency liabilities and as such shall be deemed subject to reserve requirements without benefits of credits for proration, exceptions or offsets that may be available from time to time to a Lender. The Adjusted Eurodollar Rate shall be adjusted automatically on and as of the effective date of any change in the Reserve Percentage.

1.5   “ Affiliate ” shall mean, with respect to a specified Person, any other Person which directly or indirectly, through one or more intermediaries, controls or is controlled by or is under common control with such Person, and without limiting the generality of the foregoing, includes (a) any Person which beneficially owns or holds twenty percent (20%) or more of any class of Voting Stock of such Person or other equity interests in such Person, (b) any Person of which such Person beneficially owns or holds twenty percent (20%) or more of any class of Voting Stock or in which such Person beneficially owns or holds twenty percent (20%) or more of the equity interests and (c) any director or executive officer of such Person. For the purposes of this definition, the term “control” (including with correlative meanings, the terms “controlled by” and “under common control with”), as used with respect to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of Voting Stock, by agreement or otherwise.

1.6   “ Agent ” shall mean Wachovia Capital Finance Corporation (Western), in its capacity as agent on behalf of Lenders pursuant to the terms hereof and any replacement or successor agent hereunder.

1.7   “ Agent Payment Account ” shall mean account no. 5000000030321 of Agent at Wachovia Bank, National Association, or such other account of Agent as Agent may from time to time designate to Borrowers as the Agent Payment Account for purposes of this Agreement and the other Financing Agreements.

1.8   “ Agreement and Plan of Merger ” shall have the meaning set forth in Section 4.1(p) hereof.

1.9   “ Armstrong ” shall mean Armstrong Acquisition Corp., a Delaware corporation.

1.10   “ Applicable Margin ” shall mean, at any time, with respect to any Prime Rate Loan or Eurodollar Rate Loan, the applicable rate per annum set forth below under the caption “Prime Spread” or “Eurodollar Spread”, as the case may be, based upon the Consolidated Fixed Charge Coverage Ratio of Parent Guarantor and its Subsidiaries during the four (4) fiscal quarters ending on the most recent determination date, provided   that until the first day of the month immediately following the delivery to Agent, pursuant to Section 9.6(a) hereof, of the audited consolidated financial information for the fiscal year ending December 31, 2008, the “Applicable Margin” shall be the applicable rate per annum set forth below in Tier I:

1.11   “ Assignment and Acceptance ” shall mean an Assignment and Acceptance substantially in the form of Exhibit A attached hereto (with blanks appropriately completed) delivered to Agent in connection with an assignment of a Lender’s interest hereunder in accordance with the provisions of Section 13.7 hereof.

1.12   “ Bank Products ” shall mean any one or more of the following types of services or facilities provided to Borrowers, Guarantors, or any of their respective Subsidiaries upon Borrowers request by a Bank Product Provider, including but not limited to: (a) stored value cards, (b) cash management or related services, including (i) the automated clearinghouse transfer of funds for the account of Borrowers, Guarantors, or any of their respective Subsidiaries pursuant to agreement or overdraft for any accounts of Borrowers, Guarantors, or any of their respective Subsidiaries maintained at Wachovia Bank, National Association or any Bank Product Provider that are subject to the control of Agent pursuant to any Deposit Account Control Agreement to which Agent or such Bank Product Provider is a party, as applicable, and (ii) controlled disbursement services, (c) Hedge Agreements if and to the extent permitted hereunder, and (d) foreign exchange contracts.

1.13   “ Bank Product Providers ” shall mean Wachovia and any of its Affiliates.

1.14   “ Bank Product Reserve ” shall mean any and all reserves that Agent may establish from time to time with Borrowers’ consent for the Bank Products provided by any Bank Product Provider which are then outstanding.

1.15   “ Blocked Accounts ” shall have the meaning set forth in Section 6.3 hereof.

1.16   “ Borrowers ” shall mean, collectively, the following (together with their respective successors and assigns): (a) Jazz Semiconductor, Inc., a Delaware corporation; (b) Newport Fab, LLC (d/b/a Jazz Semiconductor Operating Company), a Delaware limited liability company; and (c) any other Person that at any time after the date hereof becomes a Borrower; each sometimes being referred to herein individually as a “ Borrower ”.

1.17   “ Borrowing Base ” shall mean, at any time, the sum of:

1.18   “ Borrowing Base Certificate ” shall have the meaning given to such term in Section 7.1(a)(ii) hereof.

1.19   “ Business Day ” shall mean any day other than a Saturday, Sunday, or other day on which commercial banks are authorized or required to close under the laws of the State of California, the State of New York or the State of North Carolina, and a day on which the Reference Bank and Agent are open for the transaction of business, except that if a determination of a Business Day shall relate to any Eurodollar Rate Loans, the term Business Day shall also exclude any day on which banks are closed for dealings in dollar deposits in the London interbank market or other applicable Eurodollar Rate market.

1.20   “ Capital Expenditures ” shall mean, for any period, any expenditure of money under a Capital Lease or for the lease, purchase, or other acquisition of any capital asset (excluding consumables and spares), for the lease of any other asset, whether payable currently or in the future, or for the purchase or construction of assets, or for improvements or additions thereto, which are capitalized on a Person’s balance sheet.

1.21   “ Capital Leases ” shall mean, as applied to any Person, any lease of (or any agreement conveying the right to use) any property (whether real, personal or mixed) by such Person as lessee which in accordance with GAAP, is required to be reflected as a capital lease on the balance sheet of such Person.

1.22   “ Capital Stock ” shall mean, with respect to any Person, any and all shares, interests, participations or other equivalents (however designated) of such Person's capital stock or partnership, limited liability company or other equity interests at any time outstanding, and any and all rights, warrants or options exchangeable for or convertible into such capital stock or other interests (but excluding any debt security that is exchangeable for or convertible into such capital stock).

1.23   “ Cash Equivalents ” shall mean, at any time, (a) any evidence of Indebtedness with a maturity date of ninety (90) days or less issued or directly and fully guaranteed or insured by the United States of America or any agency or instrumentality thereof; provided , that the full faith and credit of the United States of America is pledged in support thereof; (b) certificates of deposit or bankers' acceptances with a maturity of ninety (90) days or less of any financial institution that is a member of the Federal Reserve System having combined capital and surplus and undivided profits of not less than $1,000,000,000; (c) commercial paper (including variable rate demand notes) with a maturity of ninety (90) days or less issued by a corporation (except an Affiliate of any Borrower or Guarantor) organized under the laws of any State of the United States of America or the District of Columbia and rated at least A-1 by Standard & Poor's Ratings Service, a division of The McGraw-Hill Companies, Inc. or at least P-1 by Moody's Investors Service, Inc.; (d) repurchase obligations with a term of not more than thirty (30) days for underlying securities of the types described in clause (a) above entered into with any financial institution having combined capital and surplus and undivided profits of not less than $1,000,000,000; (e) repurchase agreements and reverse repurchase agreements relating to marketable direct obligations issued or unconditionally guaranteed by the United States of America or issued by any governmental agency thereof and backed by the full faith and credit of the United States of America, in each case maturing within ninety (90) days or less from the date of acquisition; provided , that the terms of such agreements comply with the guidelines set forth in the Federal Financial Agreements of Depository Institutions with Securities Dealers and Others, as adopted by the Comptroller of the Currency on October 31, 1985; (f) investments in money market funds and mutual funds which invest substantially all of their assets in securities of the types described in clauses (a) through (e) above; and (g) investments in any Borrower’s or Guarantor’s investment plan as in effect on the Effective Date or as previously disclosed to and approved by Agent.

1.24   “ Change of Control ” shall mean (a) the transfer (in one transaction or a series of transactions) of all or substantially all of the assets of any Borrower or Guarantor to any Person or group (as such term is used in Section 13(d)(3) of the Exchange Act), other than as permitted in Section 9.7 hereof; (b) the liquidation or dissolution of any Borrower or Guarantor or the adoption of a plan by the stockholders of any Borrower or Guarantor relating to the dissolution or liquidation of such Borrower or Guarantor, other than as permitted in Section 9.7 hereof; (c) the acquisition by any Person or group (as such term is used in Section 13(d)(3) of the Exchange Act), except for one or more Permitted Holders, of beneficial ownership, directly or indirectly, of thirty-five percent (35%) of the voting power of the total outstanding Voting Stock of any Borrower or Guarantor; (d) during any period of two (2) consecutive years, individuals who at the beginning of such period constituted the Board of Directors of any Borrower or Guarantor (together with any new directors who have been appointed by any Permitted Holder, or whose nomination for election by the stockholders of such Borrower or Guarantor, as the case may be, was approved by a vote of at least sixty-six and two-thirds (66 2/3%) percent of the directors then still in office who were either directors at the beginning of such period or whose election or nomination for election was previously so approved) cease for any reason to constitute a majority of the Board of Directors of any Borrower or Guarantor then still in office; or (e) the failure of Parent Guarantor to own directly or indirectly one hundred (100%) percent of the voting power of the total outstanding Voting Stock of any other Borrower or Guarantor.

1.25   “ Code ” shall mean the Internal Revenue Code of 1986, as the same now exists or may from time to time hereafter be amended, modified, recodified or supplemented, together with all rules, regulations and interpretations thereunder or related thereto.

1.26   “ Collateral ” shall have the meaning set forth in Section 5.1 hereof.

1.27   “ Collateral Access Agreement ” shall mean an agreement in writing, in form and substance reasonably satisfactory to Agent, from (a) any lessor of premises located in the United States to any Borrower or Guarantor where Collateral with a fair market value in excess of $2,500,000 in the aggregate is stored, or (b) any other person (i) to whom any Collateral with a fair market value in excess of $2,500,000 in the aggregate is consigned or (ii) who has custody, control or possession of any such Collateral in the United States with a fair market value in excess of $2,500,000 in the aggregate or (iii) is otherwise the owner or operator of any premises located in the United States on which (A) any financial books and records of any Borrower or Guarantor is located or (B) any Borrower or Guarantor stores, manufactures or fabricates any of such Collateral with a fair market value in excess of $2,000,000 in the aggregate (including, without limitation, as of the Effective Date, the following location: 4321 Jamboree Road, Newport Beach, California 92660), in favor of Agent with respect to such Collateral at such premises or otherwise in the custody, control or possession of such lessor, consignee or other person.

1.28   “ Commitment ” shall mean, at any time, as to each Lender, the principal amount set forth below such Lender’s signature on the signatures pages hereto designated as the Commitment or on Schedule 1 to the Assignment and Acceptance Agreement pursuant to which such Lender became a Lender hereunder in accordance with the provisions of Section 13.7 hereof, as the same may be adjusted from time to time in accordance with the terms hereof; sometimes being collectively referred to herein as “ Commitments ”.

1.29   “ Conexant ” shall mean Conexant Systems, Inc., a Delaware corporation.

1.30   “ Consolidated EBITDA ” shall mean, with respect to any Person for any period, Consolidated Net Income of such Person and its Subsidiaries for such period plus, without duplication and to the extent reflected as a charge in the statement of such Consolidated Net Income for such period, the sum of (a) income tax expense, (b) Consolidated Net Interest Expense of such Person and its Subsidiaries, amortization or write-off of debt discount and debt issuance costs and commissions, discounts and other fees and charges associated with Indebtedness (including unused line fees and administrative fees and charges with respect to the Credit Facility), (c) depreciation and amortization expense (excluding such expense (i) relating to consumables and spares, and (ii) to the extent that the properties or assets being depreciated primarily benefit Foreign Parent Nonguarantor), (d) amortization or impairment of intangibles (including, but not limited to, goodwill) and organization costs, (e) any extraordinary, unusual or non-recurring expenses or losses (including, whether or not otherwise includable as a separate item in the statement of such Consolidated Net Income for such period, losses on sales of assets outside of the ordinary course of business), (f) any other non-cash charges, expenses or losses, including in relation to earn-outs and similar obligations (except to the extent such charges, expenses or losses represent an accrual of or reserve for cash expenses in any future period or an amortization of a prepaid cash expense paid in a prior period), (g) to the extent incurred after the Effective Date, restructuring and integration costs related to any acquisition transaction or Joint Venture permitted hereby (except to the extent such costs relate to the acquisition of Parent Guarantor by Foreign Parent Nonguarantor), (h) stock-option based compensation expenses, (i) to the extent such costs, fees and expenses are incurred after the Effective Date, transaction costs, fees and expenses related to a completed acquisition transaction or a Joint Venture transaction permitted hereby (except to the extent such fees, costs or expenses relate to the acquisition of Parent Guarantor by Foreign Parent Nonguarantor), (j) the non-cash portion of straight-line rent expense, (k) proceeds from any business interruption insurance (in the case of this clause (k) to the extent not reflected as revenue or income in such statement of such Consolidated Net Income), (l) losses recognized and expenses incurred in connection with the effect of currency and exchange rate fluctuations on intercompany balances and other balance sheet items, (m) cash expenses relating to earn-outs and similar obligations, and (n) to the extent incurred prior to the Effective Date and paid, and to the extent reasonably approved of by Agent, costs and expenses incurred by Parent Guarantor and its Subsidiaries in connection with the acquisition by Foreign Parent Nonguarantor of Parent Guarantor in an aggregate amount not to exceed $2,500,000, and minus , to the extent included in the statement of such Consolidated Net Income for such period, the sum of (i) interest income (except to the extent deducted in determining Consolidated Net Interest Expense), (ii) any extraordinary, unusual or non-recurring income or gains (including, without limitation, whether or not otherwise includable as a separate item in the statement of such Consolidated Net Income for such period, (1) gains on the sales of assets outside of the ordinary course of business, (2) one-time settlement gains, and (3) gains on the sale of retired capital assets), (iii) any other non-cash income or gains (other than the accrual of revenue in the ordinary course), all as determined on a consolidated basis, (iv) cash payments in connection with “straight-line” rent expense which exceed the amount expensed in respect of such rent expense, (v) gains realized and income accrued in connection with the effect of currency and exchange rate fluctuations on intercompany balances and other balance sheet items and (vi) gains realized and income accrued in connection with the redemption of the Senior Notes (for the avoidance of doubt, any gains realized and income accrued in connection with the redemption of the Senior Notes incurred prior to the Effective Date shall be excluded from this calculation).

1.31   “ Consolidated Fixed Charge Coverage Ratio ” shall mean, as of the last day of each fiscal quarter of Parent Guarantor, and based on the financial statement furnished in accordance with Section 9.6(a), the quotient (expressed as a ratio) obtained by dividing (a) Consolidated EBITDA (computed for the trailing four quarters then ending) of Parent Guarantor by (b) Consolidated Fixed Charges (computed for the trailing four quarters then ending).

1.32   “ Consolidated Fixed Charges ” shall mean, with respect to any period, the sum of, without duplication, (a) all Consolidated Net Interest Expense paid or required to be paid in cash, plus (b) all regularly scheduled (as determined at the beginning of such period) principal payments of Indebtedness (for the avoidance of doubt, for purposes of this calculation only, any reductions in the Equipment Sublimit shall be excluded from the calculation of “Consolidated Fixed Charges”), plus (c) all scheduled fees payable to Agent or any Lender, plus (d) all unfinanced Capital Expenditures, plus (e) all taxes paid or required to be paid in cash, plus (f) cash dividends and other cash distributions (including stock repurchases) to Foreign Parent Nonguarantor, plus (g) management fees, plus (h) Senior Note repurchases made for cash (for the avoidance of doubt, excluding any Senior Note repurchases made for cash prior to the Effective Date).

1.33   “ Consolidated Net Income ” shall mean, with respect to any Person for any period, the consolidated net income (or loss) of such Person and its Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP; provided , however , with respect to Parent Guarantor, Consolidated Net Income shall not include the consolidated net income (or loss) of any Person in which any other Person (other than any Borrower, any Guarantor, or any of their respective wholly-owned Subsidiaries) has a joint interest, except to the extent of the amount of dividends or other distributions actually paid to a Borrower, Guarantor or any of their respective wholly-owned Subsidiaries by such Person during such period.

1.34   “ Consolidated Net Interest Expense ” shall mean, with respect to any Person for any period, (a) total cash interest expense (including that attributable to capital lease obligations) of such Person and its Subsidiaries for such period with respect to all outstanding Indebtedness of such Person and its Subsidiaries, minus (b) total cash interest income of such Person and its Subsidiaries for such period, in each case determined in accordance with GAAP.

1.35   “ Credit Facility ” shall mean the loans and letters of credit provided to or for the benefit of any Borrower pursuant to Sections 2.1 and 2.2 hereof.

1.36   “ Credit Parties Sales Percentage ” shall have the meaning given to such term in Section 9.24 hereof.

1.37   “ Credit Party ” shall mean, collectively, each Borrower, each Guarantor, and each Subsidiary of any Borrower or Guarantor (other than any Foreign Subsidiary of any Borrower or Guarantor, any Joint Venture, and Jazz WOFE). For the avoidance of doubt, Foreign Parent Nonguarantor shall not be a Credit Party.

1.38   “ Customer Concession Reserve ” shall mean a Reserve established for concessions made or reasonably expected to be made by any Borrower to its customers consisting of credits other than product returns, which Reserve shall be calculated quarterly based on sales made during the twelve-month period prior to, and ending on, any date of determination and the concessions actually made during such period and to the extent reflected on such Borrower's books and records consistent with its historical practices.

1.39   “ Default ” shall mean an act, condition or event which with notice or passage of time or both would constitute an Event of Default.

1.40   “ Defaulting Lender ” shall have the meaning set forth in Section 6.9 hereof.

1.41   “ Deposit Account Control Agreement ” shall mean an agreement in writing, in form and substance reasonably satisfactory to Agent, by and among Agent, the Borrower or Guarantor with a deposit account (other than any deposit account specifically and exclusively used for payroll, payroll taxes and other employee wage and benefit payments to or for the benefit of any Borrower’s or Guarantor’s salaried employees) at any bank and the bank at which such deposit account is at any time maintained, which provides that such bank will comply with instructions originated by Agent directing disposition of the funds in the deposit account without further consent by such Borrower or Guarantor and has such other terms and conditions as Agent may reasonably require.

1.42   “ Domestic Subsidiary ” shall mean, with respect to any Person, any Subsidiary of such Person incorporated or organized under the laws of any jurisdiction of any state or territory of the United States or the District of Columbia.

1.43   “ Effective Date ” shall mean the date hereof.

1.44   “ Eligible Accounts ” shall mean Accounts created by each Borrower that in each case satisfy the criteria set forth below as determined by Agent. Accounts shall be Eligible Accounts if:

Any new criteria for Eligible Accounts may only be established by Agent in good faith based on either: (i) an event, condition or other circumstance arising after the date hereof, or (ii) an event, condition or other circumstance existing on the date hereof to the extent Agent has no notice thereof prior to the date hereof, in either case under clause (i) or (ii) which materially adversely affects or could reasonably be expected to materially adversely affect the Eligible Accounts (for the avoidance of doubt, after the date hereof, Agent may revise the applicable percentages set forth in clause (m) of this definition based on any information it receives regarding the creditworthiness of any account debtor). Any Accounts that are not Eligible Accounts shall nevertheless be part of the Collateral. For the avoidance of doubt, any Accounts that arise from the sale and delivery of goods substantially manufactured by Foreign Parent Nonguarantor or any of its Affiliates (other than the Borrowers) or from services substantially rendered by Foreign Parent Nonguarantor or any of its Affiliates (other than the Borrowers) shall not be Eligible Accounts.

1.45   “ Eligible Equipment ” shall mean, as to each Borrower, Equipment of such Borrower used in the ordinary course of such Borrower’s business, that in each case satisfy the criteria set forth below as reasonably determined by Agent. Eligible Equipment shall not include: (a) Equipment located outside the United States; (b) items of Equipment that are or have become fixtures other than trade fixtures which are readily removable from the premises on which they are located; (c) leased Equipment; (d) Equipment subject to a lien or security interest of any Person other than Agent except for non-consensual liens or security interests that are permitted under Sections 9.8(b), (c) or (d) hereof; (e) worn-out, obsolete or out-of-service Equipment; (f) Equipment acquired by any Borrower after the date hereof located on or affixed to the Premises (as defined in that certain Landlord Agreement dated on or about the Original Closing Date, by and among Jazz, Conexant and Agent (the " Conexant Landlord Agreement ") with respect to which Equipment the parties to such Conexant Landlord Agreement shall not have agreed upon and delivered a revised Exhibit B to such Conexant Landlord Agreement pursuant to the terms thereof, which revised Exhibit B shall designate such Equipment as added to or included within the definition of "Personal Property" as set forth in the Conexant Landlord Agreement; and (g) any individual items of Equipment with an original cost or purchase price of less than $10,000. Any new criteria for Eligible Equipment may only be established by Agent in good faith based on either: (i) an event, condition or other circumstance arising after the date hereof, or (ii) an event, condition or other circumstance existing on the date hereof to the extent Agent has no notice thereof prior to the date hereof, in either case under clause (i) or (ii) which materially adversely affects or could reasonably be expected to materially adversely affect the Eligible Equipment in the good faith determination of Agent. Any Equipment that is not Eligible Equipment shall nevertheless be part of the Collateral.

1.46   “ Eligible Transferee ” shall mean (a) any Lender; (b) the parent company of any Lender and/or any Affiliate of such Lender which is at least fifty (50%) percent owned by such Lender or its parent company; (c) any person (whether a corporation, partnership, trust or otherwise) that is engaged in the business of making, purchasing, holding or otherwise investing in bank loans and similar extensions of credit in the ordinary course of its business and is administered or managed by a Lender or with respect to any Lender that is a fund which invests in bank loans and similar extensions of credit, any other fund that invests in bank loans and similar extensions of credit and is managed by the same investment advisor as such Lender or by an Affiliate of such investment advisor, and in each case is approved by Agent; and (d) any other commercial bank, financial institution or “accredited investor” (as defined in Regulation D under the Securities Act of 1933) approved by Agent and, absent an Event of Default, Borrowers (which approval by Borrowers shall not be unreasonably withheld), provided , that , (i) neither any Borrower nor any Guarantor or any Affiliate of any Borrower or Guarantor shall qualify as an Eligible Transferee and (ii) no Person to whom any Indebtedness which is in any way subordinated in right of payment to any other Indebtedness of any Borrower or Guarantor shall qualify as an Eligible Transferee, except as Agent may otherwise specifically agree.

1.47   “ Environmental Laws ” shall mean all foreign, Federal, State and local laws (including common law), legislation, rules, codes, licenses, permits (including any conditions imposed therein), authorizations, judicial or administrative decisions, injunctions or agreements between any Borrower or Guarantor and any Governmental Authority, (a) relating to pollution and the protection, preservation or restoration of the environment (including air, water vapor, surface water, ground water, drinking water, drinking water supply, surface land, subsurface land, plant and animal life or any other natural resource), or to human health or safety, (b) relating to the exposure to, or the use, storage, recycling, treatment, generation, manufacture, processing, distribution, transportation, handling, labeling, production, release or disposal, or threatened release, of Hazardous Materials, or (c) relating to all laws with regard to recordkeeping, notification, disclosure and reporting requirements respecting Hazardous Materials. The term “Environmental Laws” includes (i) the Federal Comprehensive Environmental Response, Compensation and Liability Act of 1980, the Federal Superfund Amendments and Reauthorization Act, the Federal Water Pollution Control Act of 1972, the Federal Clean Water Act, the Federal Clean Air Act, the Federal Resource Conservation and Recovery Act of 1976 (including the Hazardous and Solid Waste Amendments thereto), the Federal Solid Waste Disposal and the Federal Toxic Substances Control Act, the Federal Insecticide, Fungicide and Rodenticide Act, and the Federal Safe Drinking Water Act of 1974, (ii) applicable state counterparts to such laws and (iii) any common law or equitable doctrine that may impose liability or obligations for injuries or damages due to, or threatened as a result of, the presence of or exposure to any Hazardous Materials.

1.48   “ Equipment ” shall mean, as to each Borrower and Guarantor, all of such Borrower's and Guarantor’s now owned and hereafter acquired equipment, wherever located, including machinery, data processing and computer equipment, computer hardware, computer software (whether owned or licensed and including embedded software), vehicles, tools, furniture, fixtures, all attachments, accessions and property now or hereafter affixed thereto or used in connection therewith, and substitutions and replacements thereof, wherever located.

1.49   “ Equipment Sublimit ” shall mean the amount set forth on Schedule 1.49 with respect to the period set forth opposite such amount.

1.50   “ ERISA ” shall mean the Employee Retirement Income Security Act of 1974, together with all rules, regulations and interpretations thereunder or related thereto.

1.51   “ ERISA Affiliate ” shall mean any person required to be aggregated with any Borrower, any Guarantor or any of their respective Subsidiaries under Sections 414(b), 414(c), 414(m) or 414(o) of the Code.

1.52   “ ERISA Event ” shall mean (a) any “reportable event”, as defined in Section 4043(c) of ERISA or the regulations issued thereunder, with respect to a Pension Plan, other than events as to which the requirement of notice has been waived in regulations by the Pension Benefit Guaranty Corporation; (b) the adoption of any amendment to a Pension Plan that would require the provision of security pursuant to Section 401(a)(29) of the Code or Section 307 of ERISA; (c) a complete or partial withdrawal by any Borrower, Guarantor or any ERISA Affiliate from a Multiemployer Plan or a cessation of operations which is treated as such a withdrawal or notification that a Multiemployer Plan is in reorganization; (d) the filing of a notice of intent to terminate, the treatment of a Pension Plan amendment as a termination under Section 4041 or 4041A of ERISA, or the commencement of proceedings by the Pension Benefit Guaranty Corporation to terminate a Pension Plan; (e) an event or condition which might reasonably be expected to constitute grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Plan; (f) the imposition of any liability under Title IV of ERISA, other than the Pension Benefit Guaranty Corporation premiums due but not delinquent under Section 4007 of ERISA, upon any Borrower or any other Credit Party in excess of $1,000,000 and (g) any other event or condition with respect to a Plan including any Pension Plan subject to Title IV of ERISA maintained, or contributed to, by any ERISA Affiliate that could reasonably be expected to result in liability of any Borrower in excess of $1,000,000.

1.53   “ Eurodollar Rate Loans ” shall mean any Loans or portion thereof on which interest is payable based on the Adjusted Eurodollar Rate in accordance with the terms hereof.

1.54   “ Event of Default ” shall mean the occurrence or existence of any event or condition described in Section 10.1 hereof.

1.55   “ Excess Availability ” shall mean the amount calculated at any date, equal to: (a) the lesser of: (i) the Borrowing Base, (ii) the Maximum Credit minus $5,000,000 or (iii) the amount equal to (A) the Accounts Sublimit plus (B) the Equipment Sublimit minus (C) $5,000,000, minus (b) the sum of: (i) the amount of all then outstanding and unpaid Obligations of Borrowers plus (ii) the aggregate amount of all then outstanding and unpaid trade payables and other obligations of each Borrower which are outstanding more than sixty (60) days past due as of the end of the immediately preceding month (other than trade payables or other obligations being contested or disputed by such Borrower in good faith), plus (iii) without duplication, the amount of checks issued by each Borrower to pay trade payables and other obligations which are more than sixty (60) days past due as of the end of the immediately preceding month (other than trade payables or other obligations being contested or disputed by such Borrower in good faith), but not yet sent.

1.56   “ Exchange Act ” shall mean the Securities Exchange Act of 1934, together with all rules, regulations and interpretations thereunder or related thereto.

1.57   “ Excluded Subsidiaries ” shall mean a collective reference to any Subsidiary of Parent Guarantor that: (a) is acquired or formed by Parent Guarantor or any of Parent Guarantor’s Subsidiaries after the date hereof; and (b) is designated as an Excluded Subsidiary by Parent Guarantor by written notice to Agent prior to the date of such acquisition or formation. For the avoidance of doubt, any Subsidiary that was a Subsidiary of Foreign Parent Nonguarantor prior to the acquisition of Parent Guarantor by Foreign Parent Nonguarantor shall be an Excluded Subsidiary.

1.58   “ Executive Order ” shall have the meaning given to such term in Section 9.20 hereof.

1.59   “ Existing Letters of Credit ” shall mean, collectively, the letters of credit issued for the account of a Borrower or Guarantor or for which such Borrower or Guarantor is otherwise liable listed on Schedule 1.59 hereto, as the same now exist or may hereafter be amended, modified, supplemented, extended, renewed, restated or replaced.

1.60   “ Fee Letter ” shall mean the letter agreement, dated of even date herewith, by and among Borrowers and Agent, setting forth certain fees payable by Borrowers to Agent for the benefit of itself and Lenders, as the same now exists or may hereafter be amended, modified, supplemented, extended, renewed, restated or replaced.

1.61   “ Financing Agreements ” shall mean, collectively, this Agreement, the Fee Letter and all notes, guarantees, security agreements, deposit account control agreements, investment property control agreements, intercreditor agreements and all other agreements, documents and instruments now or at any time hereafter executed and/or delivered by any Borrower, any Guarantor or any Guarantor in connection with this Agreement.

1.62   “ Foreign Assets Control Regulations ” shall have the meaning given to such term in Section 9.20 hereof.

1.63   “ Foreign Parent Nonguarantor ” shall mean Tower Semiconductor Ltd., an Israel company, and its successors and assigns.

1.64   “ Foreign Subsidiary ” shall mean, with respect to any Person, any Subsidiary of such Person incorporated or organized under the laws of any jurisdiction other than a state or territory of the United States or the District of Columbia.

1.65   “ Funding Bank ” shall have the meaning given to such term in Section 3.3(a) hereof.

1.66   “ GAAP ” shall mean generally accepted accounting principles in the United States of America as in effect from time to time as set forth in the opinions and pronouncements of the Accounting Principles Board and the American Institute of Certified Public Accountants and the statements and pronouncements of the Financial Accounting Standards Board which are applicable to the circumstances as of the date of determination consistently applied, except that, for purposes of Section 9.18 hereof, GAAP shall be determined on the basis of such principles in effect on the date hereof and consistent with those used in the preparation of the most recent audited financial statements delivered to Agent prior to the date hereof.

1.67   “ Guarantors ” shall mean, collectively, the following (together with their respective successors and assigns): (a) Parent Guarantor; and (b) any other Person that at any time after the date hereof becomes a Guarantor; each sometimes being referred to herein individually as a “ Guarantor ”. For the avoidance of doubt, Foreign Parent Nonguarantor shall not be a Guarantor.

1.68   “ Guaranty ” shall mean a Guaranty executed by Parent Guarantor or a Subsidiary (other than a Foreign Subsidiary)   of any Borrower or Guarantor in favor of Agent.

1.69   “ Governmental Authority ” shall mean any nation or government, any state, province, or other political subdivision thereof, any central bank (or similar monetary or regulatory authority) thereof, and any public entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government.

1.70   “ Hazardous Materials ” shall mean any hazardous, toxic or dangerous substances, materials and wastes, including hydrocarbons (including naturally occurring or man-made petroleum and hydrocarbons), flammable explosives, asbestos, urea formaldehyde insulation, radioactive materials, biological substances, polychlorinated biphenyls, pesticides, herbicides and any other kind and/or type of pollutants or contaminants (including materials which include hazardous constituents), sewage, sludge, industrial slag, solvents and/or any other similar substances, materials, or wastes and including any other substances, materials or wastes that are or become regulated under any Environmental Law (including any that are or become classified as hazardous or toxic under any Environmental Law).

1.71   “ Hedging Transactions ” shall mean (a) any and all rate swap transactions, basis swaps, forward rate transactions, commodity swaps, commodity options, forward commodity contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or options, forward bond or forward bond price or forward bond index transactions, interest rate options, forward foreign exchange transactions, cap transactions, floor transactions, collar transactions, currency swap transactions, cross-currency rate swap transaction, currency options or any other similar transactions or any combination of any of the foregoing (including any options to enter into any of the foregoing), whether or not any such transaction is governed by or subject to any master agreement, or (b) any and all transactions of any kind, and the related confirmations, that are subject to the terms or conditions of, or governed by, any form of master agreement published by the International Swaps and Derivatives Association, Inc., or any other master agreement, as amended, restated, extended, supplemented or otherwise modified in writing from time to time, including but not limited to, any such obligations or liabilities under any such agreement.

1.72   “ Indebtedness ” shall mean, with respect to any Person, any liability, whether or not contingent, (a) in respect of borrowed money (whether or not the recourse of the lender is to the whole of the assets of such Person or only to a portion thereof) or evidenced by bonds, notes, debentures or similar instruments; (b) representing the balance deferred and unpaid of the purchase price of any property or services (other than an account payable to a trade creditor (whether or not an Affiliate) incurred in the ordinary course of business of such Person and payable in accordance with customary trade practices); (c) all obligations as lessee under leases which have been, or should be, in accordance with GAAP recorded as Capital Leases; (d) any contractual obligation, contingent or otherwise, of such Person to pay or be liable for the payment of any indebtedness described in this definition of another Person, including, without limitation, any such indebtedness, directly or indirectly guaranteed, or any agreement to purchase, repurchase, or otherwise acquire such indebtedness, obligation or liability or any security therefor, or to provide funds for the payment or discharge thereof, or to maintain solvency, assets, level of income, or other financial condition; (e) all obligations with respect to redeemable stock and redemption or repurchase obligations under any Capital Stock or other equity securities issued by such Person which obligations become due prior to the maturity date hereof; (f) all reimbursement obligations and other liabilities of such Person with respect to surety bonds (whether bid, performance or otherwise), letters of credit, banker's acceptances, drafts or similar documents or instruments issued for such Person's account; (g) all indebtedness of such Person in respect of indebtedness of another Person for borrowed money or indebtedness of another Person otherwise described in this definition which is secured by any consensual lien, security interest, collateral assignment, conditional sale, mortgage, deed of trust, or other encumbrance on any asset of such Person, whether or not such obligations, liabilities or indebtedness are assumed by or are a personal liability of such Person, all as of such time, provided that if such indebtedness is not assumed by such Person, the amount of such indebtedness shall be the lesser of the fair market value of the property subject to such lien or encumbrance and the amount of such indebtedness; (h) all obligations, liabilities and indebtedness of such Person (marked to market) arising under swap agreements, cap agreements and collar agreements and other agreements or arrangements designed to protect such person against fluctuations in interest rates or currency or commodity values; (i) indebtedness of any partnership or joint venture in which such Person is a general partner or a joint venturer to the extent such Person is liable therefor as a result of such Person’s ownership interest in such entity, except to the extent that the terms of such indebtedness expressly provide that such Person is not liable therefor or such Person has no liability therefor as a matter of law and (j) the principal and interest portions of all rental obligations of such Person under any synthetic lease or similar off-balance sheet financing where such transaction is considered to be borrowed money for tax purposes but is classified as an operating lease in accordance with GAAP.

1.73   “ Indemnitee ” shall have the meaning given to such term in Section 11.4 hereof.

1.74   “ Information Certificate ” shall mean, collectively, the Information Certificates of Borrowers and Guarantors constituting Exhibit B hereto containing material information with respect to Borrowers and Guarantors, their respective businesses and assets provided by or on behalf of Borrowers and Guarantors to Agent in connection with the preparation of this Agreement and the other Financing Agreements and the financing arrangements provided for herein.

1.75   “ Intellectual Property ” shall mean, as to each Borrower and Guarantor, all of such Borrower's or Guarantor’s now owned and hereafter arising or acquired: patents, patent rights, patent applications, copyrights, works which are the subject matter of copyrights, copyright applications, copyright registrations, trademarks, servicemarks, trade names, trade styles, trademark and service mark applications, and licenses and rights to use any of the foregoing and all applications, registrations and recordings relating to any of the foregoing as may be filed in the United States Copyright Office, the United States Patent and Trademark Office or in any similar office or agency of the United States, any State thereof, any political subdivision thereof or in any other country or jurisdiction, together with all rights and privileges arising under applicable law with respect to any Borrower’s or Guarantor’s use of any of the foregoing; all extensions, renewals, reissues, divisions, continuations, and continuations-in-part of any of the foregoing; all rights to sue for past, present and future infringement of any of the foregoing; inventions, trade secrets, formulae, processes, compounds, drawings, designs, blueprints, surveys, reports, manuals, and operating standards; goodwill (including any goodwill associated with any trademark or servicemark, or the license of any trademark or servicemark); customer and other lists in whatever form maintained; trade secret rights, copyright rights, rights in works of authorship, domain names and domain name registrations; software and contract rights relating to computer software programs, in whatever form created or maintained.

1.76   “ Interest Period ” shall mean for any Eurodollar Rate Loan, a period of approximately one (1), two (2), three (3), or six (6) months duration as Borrowers may elect, the exact duration to be determined in accordance with the customary practice in the applicable Eurodollar Rate market; provided ,   that, Borrowers may not elect an Interest Period which will end after the last day of the then-current term of this Agreement.

1.77   “ Interest Rate ” shall mean,

1.78   “ Inventory ” shall mean, as to each Borrower and Guarantor, all of such Borrower's and Guarantor’s now owned and hereafter existing or acquired goods, wherever located, which (a) are leased by such Borrower or Guarantor as lessor; (b) are held by such Borrower or Guarantor for sale or lease or to be furnished under a contract of service; (c) are furnished by such Borrower or Guarantor under a contract of service; or (d) consist of raw materials, work in process, finished goods or materials used or consumed in its business.

1.79   “ Investment Property Control Agreement ” shall mean an agreement in writing, in form and substance reasonably satisfactory to Agent, by and among Agent, any Borrower or Guarantor (as the case may be) and any securities intermediary, commodity intermediary or other person who has custody, control or possession of any investment property of such Borrower or Guarantor, acknowledging that such securities intermediary, commodity intermediary or other person has custody, control or possession of such investment property on behalf of Agent, that it will comply with entitlement orders originated by Agent with respect to such investment property, or other instructions of Agent, and has such other terms and conditions as Agent may reasonably require.

1.80   “ Jazz ” shall mean Jazz Semiconductor, Inc., a Delaware corporation, and its successors and assigns.

1.81   “ Jazz WOFE ” shall mean Jazz Semiconductor (Shanghai) Co., Ltd., a China Wholly Owned Foreign Entity, organized and existing under the laws of China.

1.82   “ Joint Venture ” shall mean (a) Operating Company’s partnerships with Advanced Semiconductor Manufacturing Corporation, a company organized and existing under the laws of Shanghai PRC, and Hua Hong NEC Electronics Co., Ltd., a company organized and existing under the laws of Shanghai PRC, and (b) following the date hereof, Operating Company’s other partnerships or joint ventures with any Person that is not a wholly owned Subsidiary of any Borrower or any Guarantor.

1.83   “ Lenders ” shall mean, collectively, the financial institutions who are signatories hereto as Lenders and other Persons made a party to this Agreement as a lender in accordance with Section 13.7 hereof, and their respective successors and permitted assigns; each sometimes being referred to herein individually as a “ Lender ”.

1.84   “ Letter of Credit Documents ” shall mean, with respect to any Letter of Credit, such Letter of Credit, any amendments thereto, any documents delivered in connection therewith, any application therefor, and any agreements, instruments, guarantees or other documents (whether general in application or applicable only to such Letter of Credit) governing or providing for (a) the rights and obligations of the parties concerned or at risk or (b) any collateral security for such obligations.

1.85   “ Letter of Credit Limit ” shall mean $10,000,000.

1.86   “ Letter of Credit Obligations ” shall mean, at any time, the sum of (a) the aggregate undrawn amount of all Letters of Credit outstanding at such time, plus (b) the aggregate amount of all drawings under Letters of Credit for which the issuer thereof has not at such time been reimbursed, plus (c) without duplication, the aggregate amount of all payments made by each Lender to the issuer with respect to such Lender’s participation in Letters of Credit as provided in Section 2.2 for which Borrowers have not at such time reimbursed the Lenders, whether by way of a Loan or otherwise.

1.87   “ Letters of Credit ” shall mean all letters of credit (whether documentary or stand-by and whether for the purchase of inventory, equipment or otherwise) issued by an issuer for the account of Borrowers pursuant to this Agreement, and all amendments, renewals, extensions or replacements thereof. The issuer of the Letters of Credit shall be, and all references to such issuer herein shall mean, Wachovia Bank, National Association and its successors and assigns or such other bank as Agent may from time to time designate.

1.88   “ License Agreement ” and “ License Agreements ” shall have the meanings set forth in Section 8.11 hereof.

1.89   “ Loans ” shall mean the loans now or hereafter made by or on behalf of Agent and the Lenders on a revolving basis pursuant to the Credit Facility (involving advances, repayments and readvances) as set forth in Section 2.1 hereof.

1.90   “ London Interbank Offered Rate ” shall mean, with respect to any Eurodollar Rate Loan for the Interest Period applicable thereto, the rate of interest per annum (rounded upwards, if necessary, to the nearest 1/100 of 1%) appearing on Telerate Page 3750 (or any successor page) as the London interbank offered rate for deposits in U.S. Dollars at approximately 11:00 A.M. (London time) two (2) Business Days prior to the first day of such Interest Period for a period of one, two, three or six months, as selected by Borrowers; provided , that, if more than one rate is specified on Telerate Page 3750, the applicable rate shall be the arithmetic mean of all such rates. If, for any reason, such rate is not available, the term “London Interbank Offered Rate” shall mean, with respect to any Eurodollar Rate Loan for the Interest Period applicable thereto, the rate of interest per annum (rounded upwards, if necessary, to the nearest 1/100 of 1%) appearing on Reuters Screen LIBO Page as the London interbank offered rate for deposits in Dollars at approximately 11:00 A.M. (London time) two (2) Business Days prior to the first day of such Interest Period for a term comparable to such Interest Period; provided , however , if more than one rate is specified on Reuters Screen LIBO Page, the applicable rate shall be the arithmetic mean of all such rates. For the avoidance of doubt, the Euro London interbank offered rate or EURO LIBOR shall not be applicable to any interest rate in this Agreement.

1.91   “ Material Adverse Effect ” shall mean a material adverse effect on (a) the financial condition, business, performance or results of operations of Borrowers taken as a whole; (b) the legality, validity or enforceability of this Agreement or any of the other Financing Agreements; (c) the legality, validity, enforceability, perfection or priority of the security interests and liens of Agent upon the Collateral; (d) the Collateral or its value; (e) the ability of any Borrower to perform its obligations under this Agreement or any of the other Financing Agreements as and when to be performed; or (f) the ability of Agent or any Lender to enforce the Obligations or realize upon the Collateral or otherwise with respect to the rights and remedies of Agent and Lenders under this Agreement or any of the other Financing Agreements.

1.92   “ Material Contract ” shall mean any contract or other agreement (other than the Financing Agreements), whether written or oral, to which any Borrower or Guarantor is a party as to which the breach, nonperformance, cancellation or failure to renew by any party thereto would have a Material Adverse Effect.

1.93   “ Maturity Date ” shall have the meaning set forth in Section 13.1 hereof.

1.94   “ Maximum Credit ” shall mean the amount equal to $55,000,000, as reduced by any reduction thereof pursuant to Section 2.1(c) hereof.

1.95   “ Multiemployer Plan ” shall mean a “multi-employer plan” as defined in Section 4001(a)(3) of ERISA which is or was at any time during the current year or the immediately preceding six (6) years contributed to by any Borrower, Guarantor or any ERISA Affiliate and with respect to which any Borrower, Guarantor or any other Credit Party is reasonably expected to incur any material liability.

1.96   “ New Subsidiary ” shall have the meaning given to such term in Section 9.10(i) hereof.

1.97   “ Non-Excluded Taxes ” shall have the meaning given to such term in Section 6.4(c) hereof.

1.98   “ Non-U.S. Lender ” shall have the meaning given to such term in Section 6.4(e) hereof.

1.99   “ Obligations ” shall mean any and all Loans, Letter of Credit Obligations and all other obligations, liabilities and indebtedness of every kind, nature and description owing by any or all of the Borrowers to Agent or any Lender and/or any of their Affiliates, including all obligations arising under or in connection with Bank Products, in each case including principal, interest, charges, fees, costs and expenses, however evidenced, whether as principal, surety, endorser, guarantor or otherwise, in each case, arising under this Agreement or any of the other Financing Agreements or on account of any Letter of Credit and all other Letter of Credit Obligations, whether now existing or hereafter arising, whether arising before, during or after the initial or any renewal term of this Agreement or after the commencement of any case with respect to any Borrower under the United States Bankruptcy Code or any similar statute (including the payment of interest and other amounts which would accrue and become due but for the commencement of such case, whether or not such amounts are allowed or allowable in whole or in part in such case), whether direct or indirect, absolute or contingent, joint or several, due or not due, primary or secondary, liquidated or unliquidated, or secured or unsecured.

1.100   “ Operating Company ” shall mean Newport Fab, LLC (doing business as Jazz Semiconductor Operating Company), a Delaware limited liability company, and its successors and assigns.

1.101   “ Original Closing Date ” shall mean January 6, 2006.

1.102   “ Other Taxes ” shall mean any and all present or future stamp or documentary taxes or any other excise or property taxes, charges or similar levies arising from any payment made hereunder or from the execution, delivery or enforcement of, or otherwise with respect to, this Agreement.

1.103   “ Parent Guarantor ” shall mean Jazz Technologies, Inc., a Delaware corporation, and its successors and assigns.

1.104   “ Participant ” shall mean any financial institution that acquires and holds a participation in the interest of any Lender in any of the Loans and Letters of Credit in conformity with the provisions of Section 13.7 of this Agreement governing participations.

1.105   “ Pension Plan ” shall mean a pension plan (as defined in Section 3(2) of ERISA) subject to Title IV of ERISA which any Borrower or Guarantor sponsors, maintains, or to which any Borrower, Guarantor or any ERISA Affiliate makes, is making, or is obligated to make contributions, other than a Multiemployer Plan and with respect to which any Borrower, any Guarantor or any other Credit Party is reasonably expected to incur any material liability.

1.106   “ Permits ” shall have the meaning given to such term in Section 8.7(b) hereof.

1.107   “ Permitted Holders ” shall mean the persons listed on Schedule 1.107 hereto, Affiliates thereof and their respective successors and assigns.

1.108   “ Person ” or “ person ” shall mean any individual, sole proprietorship, partnership, corporation (including any corporation which elects subchapter S status under the Code), limited liability company, limited liability partnership, business trust, unincorporated association, joint stock corporation, trust, joint venture or other entity or any government or any agency or instrumentality or political subdivision thereof.

1.109   “ Plan ” shall mean an employee benefit plan (as defined in Section 3(3) of ERISA) which any Borrower or Guarantor sponsors, maintains, or to which it makes, is making, or is obligated to make contributions, or in the case of a Multiemployer Plan has made contributions at any time during the immediately preceding six (6) plan years and with respect to which any Borrower, any Guarantor or any other Credit Party is reasonably expected to incur any material liability.

1.110   “ Prime Rate ” shall mean the rate from time to time publicly announced by Wachovia Bank, National Association, or its successors, as its prime rate, whether or not such announced rate is the best rate available at such bank.

1.111   “ Prime Rate Loans ” shall mean any Loans or portion thereof on which interest is payable based on the Prime Rate in accordance with the terms thereof.

1.112   “ Pro Rata Share ” shall mean as to any Lender, the fraction (expressed as a percentage) the numerator of which is such Lender's Commitment and the denominator of which is the aggregate amount of all of the Commitments of Lenders, as adjusted from time to time in accordance with the provisions of Section 13.7 hereof; provided , that , if the Commitments have been terminated, the numerator shall be the unpaid amount of such Lender's Loans and its interest in the Letters of Credit and the denominator shall be the aggregate amount of all unpaid Loans and Letters of Credit.

1.113   “ Qualified Cash ” shall mean, as of any date of determination, the amount of unrestricted cash and Cash Equivalents of Borrowers, Guarantors and their respective Subsidiaries that is in deposit accounts or in securities accounts or investment property accounts, or any combination thereof, and each of which deposit accounts or securities accounts or investment property accounts is subject to the first priority lien of Agent pursuant to a Deposit Account Control Agreement or Investment Property Control Agreement, as applicable, and not otherwise encumbered other than by the banker's lien or right of offset of the bank or securities intermediary or commodity intermediary at which such account is located, and is maintained by a branch office of the bank or securities intermediary or commodity intermediary located within the United States, and is set forth on Schedule 1.113 (as such Schedule may be updated from time to time upon the opening of any such account in accordance with Section 5.2(d) or Section 5.2(e), as applicable); provided , that "Qualified Cash" shall not include any such amount of unrestricted cash and Cash Equivalents that is (a) in any such accounts or combination thereof (i) specifically and exclusively used for payroll, payroll taxes and other employee wage and benefit payments to or for the benefit of any Borrower’s, any Guarantor’s or any such Subsidiary's salaried employees, or (ii) that are operating, overnight or other accounts, the amounts in which are subject to being debited in order to honor or otherwise satisfy checks written or issued thereon, but only to the extent checks actually have been written in respect of such amounts, and (b) in any Blocked Account to the extent such amounts have been applied against the Loans pursuant to Section 6.3(b) hereof; and further   provided , that "Qualified Cash" shall only include such amounts of unrestricted cash and Cash Equivalents for which Borrowers or Guarantors have provided evidence thereof with respect to such accounts to Agent, which evidence shall be reasonably satisfactory to Agent.

1.114   “ Real Property ” shall mean, as to any Borrower or Guarantor, all now owned and hereafter acquired real property of such Borrower or such Guarantor, including leasehold interests, together with all buildings, structures, and other improvements located thereon and all licenses, easements and appurtenances relating thereto, wherever located.

1.115   “ Receivables ” shall mean all of the following now owned or hereafter arising or acquired property of each Borrower and Guarantor: (a) all Accounts; (b) all interest, fees, late charges, penalties, collection fees and other amounts due or to become due or otherwise payable in connection with any Account; (c) all payment intangibles of such Borrower or Guarantor; (d) letters of credit, indemnities, guarantees, security or other deposits and proceeds thereof issued payable to any Borrower or Guarantor or otherwise in favor of or delivered to any Borrower or Guarantor in connection with any Account; or (e) all other accounts, contract rights, chattel paper, instruments, notes, general intangibles and other forms of obligations owing to any Borrower or Guarantor, whether from the sale and lease of goods or other property, licensing of any property (including Intellectual Property or other general intangibles), rendition of services or from loans or advances by any Borrower or Guarantor or to or for the benefit of any third person (including loans or advances to any Affiliates or Subsidiaries of any Borrower or Guarantor) or otherwise associated with any Accounts, Inventory or general intangibles of any Borrower or Guarantor (including, without limitation, choses in action, causes of action, tax refunds, tax refund claims, any funds which may become payable to any Borrower or Guarantor in connection with the termination of any Plan or other employee benefit plan and any other amounts payable to any Borrower or Guarantor from any Plan or other employee benefit plan, rights and claims against carriers and shippers, rights to indemnification, business interruption insurance and proceeds thereof, casualty or any similar types of insurance and any proceeds thereof and proceeds of insurance covering the lives of employees on which any Borrower or Guarantor is a beneficiary).

1.116   “ Records ” shall mean, as to each Borrower and Guarantor, all of such Borrower's and Guarantor’s present and future books of account of every kind or nature, purchase and sale agreements, invoices, ledger cards, bills of lading and other shipping evidence, statements, correspondence, memoranda, credit files and other data relating to the Collateral or any account debtor, together with the tapes, disks, diskettes and other data and software storage media and devices, file cabinets or containers in or on which the foregoing are stored (including any rights of any Borrower or Guarantor with respect to the foregoing maintained with or by any other person).

1.117   “ Reference Bank ” shall mean Wachovia Bank, National Association, or such other bank as Agent may from time to time designate.

1.118   “ Register ” shall have the meaning set forth in Section 13.7 hereof.

1.119   “ Required Lenders ” shall mean, at any time, those Lenders whose pro rata share of the obligations to make Loans and/or issue Letters of Credit, as the case may be, pursuant to Section 2 hereof aggregate at least fifty and one tenth of one percent (50.1%) of all such obligations, or if such obligations shall have been terminated or have otherwise expired, Lenders to whom at least fifty and one tenth of one percent (50.1%) of the then outstanding Obligations are owing.

1.120   “ Reserves ” shall mean as of any date of determination, such amounts as Agent may from time to time establish and revise in good faith reducing the amount of Loans and Letters of Credit which would otherwise be available to Borrowers under the lending formula(s) provided for herein: (a) to reflect events, conditions, contingencies or risks which, as determined by Agent in good faith, materially adversely affect, or would have a reasonable likelihood of materially adversely affecting, (i) the Collateral constituting Accounts or Equipment, its value or the amount that would reasonably be likely to be received by Agent from the sale or other disposition or realization upon such Collateral, or (ii) the security interests and other rights of Agent in the Collateral constituting Accounts or Equipment (including the enforceability, perfection and priority thereof) or (b) to reflect Agent's good faith belief that any collateral report relating to Accounts or Equipment furnished by or on behalf of any Borrower or any Guarantor to Agent is or may have been incomplete, inaccurate or misleading in any material respect or (c) to reflect outstanding Letters of Credit as provided in Section 2.2 hereof or (d) in respect of any state of facts which Agent determines in good faith constitutes a Default or an Event of Default. Without limiting the generality of the foregoing, Reserves may, at Agent’s option, be established to reflect: (A) dilution with respect to the Accounts (based on the ratio of the aggregate amount of non-cash reductions in Accounts, other than reductions specifically reserved in Customer Concession Reserves, for any period to the aggregate dollar amount of the sales of such Borrower for such period) as calculated by Agent for any period is or is reasonably anticipated to be greater than five percent (5%); (B) except as provided in the Customer Concession Reserve, returns, discounts, claims, credits and allowances of any nature that are not paid pursuant to the reduction of Accounts; (C) amounts past due to owners and lessors of premises where any Collateral is located, other than for those locations where Agent has received a Collateral Access Agreement that Agent has accepted in writing; (D) the Customer Concession Reserve; (E) the Sales Return Reserve; (F) the Bank Products Reserve; and (G) any other Reserve, including without limitation any Reserve for deferred revenue to the extent reserved by any Borrower on its books and records consistent with its historical practices. The amount of any Reserve established by Agent shall have a reasonable relationship to the event, condition, Event of Default or other matter which is the basis for such reserve as determined by Agent in good faith. To the extent Agent may revise the lending formulas used to determine the Borrowing Base or establish new criteria (with respect to new information, circumstances or facts) or revise existing criteria for Eligible Accounts or Eligible Equipment so as to address any circumstances, condition, event or contingency in a manner satisfactory to Agent, Agent shall not establish a Reserve for the same purpose or a Reserve that is otherwise duplicative of any other Reserve or change in criteria.

1.121   “ Responsible Officer ” shall mean, with respect to any Person, the chief executive officer, president, chief financial officer, treasurer, or any equivalent senior officer of such Person having the duties of any such officer.

1.122   “ Sales Return Reserve ” shall mean a Reserve established for potential future returned sale items to any Borrower, which Reserve shall be calculated quarterly based on returns made during the twelve-month period prior to, and ending on, any date of determination and to the extent reflected on such Borrower's books and records consistent with its historical practices.

1.123   “ Secured Parties ” shall mean, collectively, (a) Agent, (b) Wachovia Bank, National Association, (c) Lenders, and (d) Bank Product Providers (to the extent approved by Agent).

1.124   “ Senior Notes ” shall mean the 8% Convertible Senior Notes due 2011, or “Securities” as defined in the Senior Note Indenture.

1.125   “ Senior Note Indenture ” shall mean that certain Indenture, dated as of December 19, 2006, by and among Parent Guarantor, certain Affiliates of Parent Guarantor, and U.S. Bank National Association, as trustee.

1.126   “ Skyworks ” shall mean Skyworks Solutions, Inc., a Delaware corporation.

1.127   “ Solvent ” shall mean, at any time with respect to any Person, that at such time such Person (a) is able to pay its debts as they mature and has (and has a reasonable basis to believe it will continue to have) sufficient capital (and not unreasonably small capital) to carry on its business consistent with its practices as of the date hereof, and (b) the assets and properties of such Person at a fair valuation (and including as assets for this purpose at a fair valuation all rights of subrogation, contribution or indemnification arising pursuant to any guarantees given by such Person) are greater than the Indebtedness of such Person, and including subordinated and contingent liabilities computed at the amount which, such person has a reasonable basis to believe, represents an amount which can reasonably be expected to become an actual or matured liability (and including as to contingent liabilities arising pursuant to any guarantee the face amount of such liability as reduced to reflect the probability of it becoming a matured liability).

1.128   “ Special Agent Advances ” shall have the meaning set forth in Section 12.21(a) hereof.

1.129   “ Specialtysemi ” shall mean Specialtysemi, Inc., a Delaware corporation (now named "Jazz Semiconductor, Inc.").

1.130   “ Subsidiary ” or “ subsidiary ” shall mean, with respect to any Person, any corporation, limited liability company, limited liability partnership or other limited or general partnership, trust, association or other business entity of which an aggregate of at least a majority of the outstanding Capital Stock or other interests entitled to vote in the election of the board of directors of such corporation (irrespective of whether, at the time, Capital Stock of any other class or classes of such corporation shall have or might have voting power by reason of the happening of any contingency), managers, trustees or other controlling persons, or an equivalent controlling interest therein, of such Person is, at the time, directly or indirectly, owned by such Person and/or one or more subsidiaries of such Person.

1.131   “ Subsidiary Investment ” shall have the meaning given to such term in Section 9.10(i) hereof.

1.132   “ Target ” shall have the meaning given to such term in Section 9.10(i) hereof.

1.133   “ Trading With the Enemy Act ” shall have the meaning given to such term in Section 9.20 hereof.

1.134   “ UCC ” shall mean the Uniform Commercial Code as in effect in the State of California, and any successor statute, as in effect from time to time (except that terms used herein which are defined in the Uniform Commercial Code as in effect in the State of California on the date hereof shall continue to have the same meaning notwithstanding any replacement or amendment of such statute except as Agent may otherwise determine).

1.135   “ U.S. ” or “ United States ” shall mean the United States of America.

1.136   “ voidable transfers ” shall have the meaning set forth in Section 12.9.

1.137   “ Voting Stock ” shall mean with respect to any Person, (a) one (1) or more classes of Capital Stock of such Person having general voting powers to elect at least a majority of the board of directors, managers or trustees of such Person, irrespective of whether at the time Capital Stock of any other class or classes have or might have voting power by reason of the happening of any contingency, and (b) any Capital Stock of such Person convertible or exchangeable without restriction at the option of the holder thereof into Capital Stock of such Person described in clause (a) of this definition.

1.138   “ Wachovia ” shall mean Wachovia Capital Finance Corporation (Western), a California corporation, in its individual capacity, and its successors and assigns.

SECTION 2.   CREDIT FACILITIES

2.1   Loans .

(a)   Subject to and upon the terms and conditions contained herein, each Lender severally (and not jointly) agrees to make its Pro Rata Share of revolving loans to Borrowers from time to time on any Business Day on or after the Effective Date in amounts requested by Borrowers up to the aggregate amount outstanding for all Lenders at any time equal to the lesser of: (i) the Borrowing Base, (ii) an amount equal to the Maximum Credit minus $5,000,000, or (iii) an amount equal to (A) the Accounts Sublimit plus (B) the Equipment Sublimit minus (C) $5,000,000.

(b)   Except in Agent's discretion, at no time shall, the aggregate amount of the outstanding Loans and the Letter of Credit Obligations exceed an amount equal to the lesser of: (i) the Borrowing Base, (ii) an amount equal to the Maximum Credit minus $5,000,000, or (iii) an amount equal to (A) the Accounts Sublimit plus (B) the Equipment Sublimit minus (C) $5,000,000. If the event set forth in the preceding sentence of this Section 2.1(b) shall have occurred, such event shall not limit, waive or otherwise affect any rights of Agent or Lenders in such circumstances or on any future occasions, and Borrowers shall, upon demand by Agent, which may be made at any time or from time to time, promptly repay to Agent the entire amount of any such excess that results from the occurrence of any such event for which payment is demanded.

(c)   By providing ten (10) Business Days' written notice to Agent, Borrowers may request that the amount set forth in the definition of "Maximum Credit" hereof be reduced in an amount or amounts which shall not cause such amount set forth in such definition to be less than $30,000,000, which reduction shall be in increments of no less than $5,000,000; provided , that no Default or Event of Default shall have occurred and be continuing prior to or after giving effect to any such reduction; and further   provided , that Borrowers may not make any such request more than two (2) times per year. Upon giving effect to such reduction, the amounts set forth in the definitions of “Accounts Sublimit” and “Equipment Sublimit” shall be reduced pro rata with such reduction.

2.2   Letters of Credit .

(a)   Subject to and upon the terms and conditions contained herein and in the Letter of Credit Documents, at the request of Borrowers, Agent agrees to provide or arrange for the account of Borrowers one or more Letters of Credit, for the ratable risk of each Lender according to its Pro Rata Share, containing terms and conditions acceptable to Agent and the issuer thereof.

(b)   Borrowers shall give Agent three (3) Business Days’ prior written notice of its request for the issuance of a Letter of Credit. Such notice shall be irrevocable and shall specify the original face amount of the Letter of Credit requested, the effective date (which date shall be a Business Day and in no event shall be a date less than ten (10) days prior to the end of the then current term of this Agreement) of issuance of such requested Letter of Credit, whether such Letter of Credit may be drawn in a single or in partial draws, the date on which such requested Letter of Credit is to expire (which date shall be a Business Day and shall not be more than one year from the date of issuance), the purpose for which such Letter of Credit is to be issued, and the beneficiary of the requested Letter of Credit. Borrowers shall attach to such notice the proposed terms of the Letter of Credit. The renewal or extension of any Letter of Credit shall, for purposes hereof, be treated in all respects the same as the issuance of a new Letter of Credit hereunder.

(c)   In addition to being subject to the satisfaction of the applicable conditions precedent contained in Section 4 hereof and the other terms and conditions contained herein, no Letter of Credit shall be available unless each of the following conditions precedent have been satisfied in a manner reasonably satisfactory to Agent: (i) Borrowers shall have delivered to the proposed issuer of such Letter of Credit at such times and in such manner as such proposed issuer may require, an application, in form and substance reasonably satisfactory to such proposed issuer and Agent, for the issuance of the Letter of Credit and such other Letter of Credit Documents as may be required pursuant to the terms thereof, and the form and terms of the proposed Letter of Credit shall be reasonably satisfactory to Agent and such proposed issuer; (ii) as of the date of issuance, no order of any court, arbitrator or other 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 issuer of such Letter of Credit refrain from, the issuance of letters of credit generally or the issuance of such Letters of Credit; (iii) after giving effect to the issuance of such Letter of Credit, the Letter of Credit Obligations shall not exceed the Letter of Credit Limit; and (iv) the Excess Availability, prior to giving effect to any Reserves with respect to such Letter of Credit, on the date of the proposed issuance of any Letter of Credit, shall be equal to or greater than an amount equal to one hundred percent (100%) of the Letter of Credit Obligations with respect thereto. Effective on the issuance of each Letter of Credit, a Reserve shall be established in the amount set forth in Section 2.2(c)(iv).

(d)   Except in Agent's discretion, the amount of all outstanding Letter of Credit Obligations shall not at any time exceed the Letter of Credit Limit.

(e)   Borrowers shall reimburse immediately the issuer of a Letter of Credit for any draw under any Letter of Credit issued for the account of Borrowers by such issuer and pay such issuer the amount of all other charges and fees payable to such issuer in connection with any Letter of Credit issued for the account of Borrowers immediately when due, irrespective of any claim, setoff, defense or other right which Borrowers, or any of them, may have at any time against such issuer or any other Person. Each drawing under any Letter of Credit or other amount payable in connection therewith when due shall constitute a request by Borrowers to Agent for a Prime Rate Loan in the amount of such drawing or other amount then due and shall be made by Agent on behalf of Lenders as a Loan. The date of such Loan shall be the date of the drawing or as to other amounts, the due date therefor. Any payments made by or on behalf of Agent or any Lender to an issuer and/or related parties in connection with any Letter of Credit shall constitute additional Loans to Borrowers pursuant to this Section 2.

(f)   Borrowers and Guarantors shall indemnify and hold Agent and Lenders harmless from and against any and all losses, claims, damages, liabilities, costs and expenses which Agent or any Lender may suffer or incur in connection with any Letter of Credit and any documents, drafts or acceptances relating thereto, including any losses, claims, damages, liabilities, costs and expenses due to any action taken by any issuer or correspondent with respect to any Letter of Credit, except for such losses, claims, damages, liabilities, costs or expenses that are a direct result of the gross negligence or willful misconduct of Agent or any Lender. Each Borrower and Guarantor assumes all risks with respect to the acts or omissions of the drawer under or beneficiary of any Letter of Credit and for such purposes the drawer or beneficiary shall be deemed such Borrower's agent. Each Borrower and Guarantor assumes all risks for, and agrees to pay, all foreign, Federal, State and local taxes, duties and levies relating to any goods subject to any Letter of Credit or any documents, drafts or acceptances thereunder. Each Borrower and Guarantor hereby releases and holds Agent and Lenders harmless from and against any acts, waivers, errors, delays or omissions, with respect to or relating to any Letter of Credit, except for the gross negligence or willful misconduct of Agent or any Lender. The provisions of this Section 2.2(f) shall survive the payment of Obligations and the termination of this Agreement.

(g)   In connection with Inventory purchased pursuant to any Letter of Credit, Borrowers and Guarantors shall, at Agent’s request, instruct all suppliers, carriers, forwarders, customs brokers, warehouses or others receiving or holding cash, checks, Inventory, documents or instruments in which Agent holds a security interest that upon Agent’s request, such items are to be delivered to Agent and/or subject to Agent’s order, and if they shall come into any Borrower’s or Guarantor’s possession, to deliver them, upon Agent's request, to Agent in their original form. Except as otherwise provided herein, Agent shall not exercise such right to request such items so long as no Event of Default shall exist or have occurred and be continuing. Except as Agent may otherwise specify, Borrowers shall designate Agent or the issuer of the Letter of Credit related thereto, as the consignee on all bills of lading and other negotiable and non-negotiable documents.

(h)   Each Borrower and Guarantor hereby irrevocably authorizes and directs any issuer of a Letter of Credit to name such Borrower or Guarantor as the account party therein and to deliver to Agent all instruments, documents and other writings and property received by issuer pursuant to the Letter of Credit and to accept and rely upon Agent’s instructions and agreements with respect to all matters arising in connection with the Letter of Credit or the Letter of Credit Documents with respect thereto. Nothing contained herein shall be deemed or construed to grant any Borrower or Guarantor any right or authority to pledge the credit of Agent or any Lender in any manner. Agent and Lenders shall have no liability of any kind with respect to any Letter of Credit provided by an issuer other than Agent unless Agent has duly executed and delivered to such issuer the application or a guarantee or indemnification in writing with respect to such Letter of Credit. Borrowers and Guarantors shall be bound by any reasonable interpretation made in good faith by Agent, or any other issuer or correspondent under or in connection with any Letter of Credit or any documents, drafts or acceptances thereunder, notwithstanding that such interpretation may be inconsistent with any instructions of any Borrower or Guarantor.

(i)   Immediately upon the issuance or amendment of any Letter of Credit, each Lender shall be deemed to have irrevocably and unconditionally purchased and received, without recourse or warranty, an undivided interest and participation to the extent of such Lender’s Pro Rata Share of the liability with respect to such Letter of Credit and the obligations of Borrowers with respect thereto (including all Letter of Credit Obligations with respect thereto). Each Lender shall absolutely, unconditionally and irrevocably assume, as primary obligor and not as surety, and be obligated to pay to the issuer of any such Letter of Credit therefor and discharge when due, its Pro Rata Share of all of such obligations arising under such Letter of Credit. Without limiting the scope and nature of each Lender’s participation in any Letter of Credit, to the extent that the issuer has not been reimbursed or otherwise paid as required hereunder or under any such Letter of Credit, each such Lender shall pay to the issuer its Pro Rata Share of such unreimbursed drawing or other amounts then due to issuer in connection therewith.

(j)   The obligations of Borrowers to pay each Letter of Credit Obligations and the obligations of Lenders to make payments to Agent for the account of any issuer with respect to Letters of Credit shall be absolute, unconditional and irrevocable and shall be performed strictly in accordance with the terms of this Agreement under any and all circumstances, whatsoever, notwithstanding the occurrence or continuance of any Default, Event of Default, the failure to satisfy any other condition set forth in Section 4 or any other event or circumstance. If such amount is not made available by a Lender when due, Agent shall be entitled to recover such amount on demand from such Lender with interest thereon, for each day from the date such amount was due until the date such amount is paid to Agent at the interest rate then payable by any Borrower in respect of Loans that are Prime Rate Loans. Any such reimbursement shall not relieve or otherwise impair the obligation of Borrowers to reimburse the issuer under any Letter of Credit or make any other payment in connection therewith.

(k)   So long as no Event of Default exists or has occurred and is continuing, any Borrower may, after notice to Agent, (i) approve or resolve any questions of non-compliance of documents, (ii) give any instructions as to acceptance or rejection of any documents or goods, (iii) execute any and all applications for steamship or airway guaranties, indemnities or delivery orders, and (iv) with Agent's consent, grant any extensions of the maturity of, time of payment for, or time of presentation of, any drafts, acceptances, or documents, and agree to any amendments, renewals, extensions, modifications, changes or cancellations of any of the terms or conditions of any of the Letter of Credit Documents.

(l)   At any time an Event of Default exists or has occurred and is continuing, Agent shall have the right and authority to, and none of the Borrowers shall, without the prior written consent of Agent, (i) approve or resolve any questions of non-compliance of documents, (ii) give any instructions as to acceptance or rejection of any documents or goods, (iii) execute any and all applications for steamship or airway guaranties, indemnities or delivery orders, (iv) grant any extensions of the maturity of, time of payments for, or time of presentation of, any drafts, acceptances, or documents, and (v) agree to any amendments, renewals, extensions, modifications, changes or cancellations of any of the terms or conditions of any of the Letter of Credit Documents. Agent may take such actions either in its own name or in any Borrower's name.

(m)   Any rights, remedies, duties or obligations granted or undertaken by any Borrower to any issuer or correspondent in any application for any Letter of Credit, or any other agreement in favor of any issuer or correspondent relating to any Letter of Credit, shall be deemed to have been granted or undertaken by such Borrower to Agent. Any duties or obligations undertaken by Agent to any issuer or correspondent in any application for any Letter of Credit, or any other agreement by Agent in favor of any issuer or correspondent relating to any Letter of Credit, shall be deemed to have been undertaken by Borrowers to Agent and to apply in all respects to Borrowers.

2.3   Commitments . The aggregate amount of each Lender’s Pro Rata Share of the Loans and Letter of Credit Obligations shall not exceed the amount of such Lender’s Commitment, as the same may from time to time be amended in accordance with the provisions hereof.

SECTION 3.   INTEREST AND FEES

3.1   Interest .

(a)   Borrowers shall pay to Agent, for the benefit of Lenders, interest on the outstanding principal amount of the Loans at the Interest Rate. All interest accruing hereunder on and after the date of any Event of Default and during the continuation thereof or termination hereof shall be payable on demand.

(b)   Borrowers may from time to time request Eurodollar Rate Loans or may request that Prime Rate Loans be converted to Eurodollar Rate Loans or that any existing Eurodollar Rate Loans continue for an additional Interest Period. Such request from Borrowers shall be received at least three (3) Business Days prior to the end of the applicable Interest Period and shall specify the amount of the Eurodollar Rate Loans or the amount of the Prime Rate Loans to be converted to Eurodollar Rate Loans or the amount of the Eurodollar Rate Loans to be continued (subject to the limits set forth below) and the Interest Period to be applicable to such Eurodollar Rate Loans. Subject to the terms and conditions contained herein, after receipt by Agent of such a request from Borrowers and after the end of the applicable Interest Period, such Eurodollar Rate Loans shall be made or Prime Rate Loans shall be converted to Eurodollar Rate Loans or such Eurodollar Rate Loans shall continue, as the case may be, provided , that , (i) no Default or Event of Default shall exist or have occurred and be continuing, (ii) no party hereto shall have sent any notice of termination of this Agreement, (iii) Borrowers shall have complied with such customary procedures as are established by Agent and specified by Agent to Borrowers from time to time for requests by Borrowers for Eurodollar Rate Loans, (iv) no more than four (4) Interest Periods may be in effect at any one time, (v) the aggregate amount of the Eurodollar Rate Loans must be in an amount not less than $3,000,000 or an integral multiple of $250,000 in excess thereof, (vi) the maximum amount of the Eurodollar Rate Loans in the aggregate at any time requested by Borrowers shall not exceed the amount equal to the lowest principal amount of the Loans which it is anticipated will be outstanding during the applicable Interest Period, in each case as determined by Borrower in good faith, and (vii) Agent and each Lender shall have determined that the Interest Period or Adjusted Eurodollar Rate is available to Agent and such Lender through the Reference Bank and can be readily determined as of the date of the request for such Eurodollar Rate Loan by Borrowers. Any request by Borrowers for Eurodollar Rate Loans or to convert Prime Rate Loans to Eurodollar Rate Loans or to continue any existing Eurodollar Rate Loans shall be irrevocable. Notwithstanding anything to the contrary contained herein, Agent, Lenders and Reference Bank shall not be required to purchase United States Dollar deposits in the London interbank market or other applicable Eurodollar Rate market to fund any Eurodollar Rate Loans, but the provisions hereof shall be deemed to apply as if Agent, Lenders and Reference Bank had purchased such deposits to fund the Eurodollar Rate Loans.

(c)   Any Eurodollar Rate Loans shall automatically convert to Prime Rate Loans upon the last day of the applicable Interest Period, unless Agent has received and approved a request to continue such Eurodollar Rate Loan at least three (3) Business Days prior to such last day in accordance with the terms hereof. Any Eurodollar Rate Loans shall, at Agent's option, upon notice by Agent to Borrowers, be subsequently converted to Prime Rate Loans upon termination of this Agreement. Borrowers shall pay to Agent, for the benefit of Lenders, upon demand by Agent (or Agent may, at its option, charge any loan account of any Borrower) any amounts required to compensate any Lender, the Reference Bank or any Participant for any loss (including loss of anticipated profits), cost or expense incurred by such person, as a result of the conversion of Eurodollar Rate Loans to Prime Rate Loans pursuant to any of the foregoing other than any such conversion as set forth in the first sentence of this subsection (c).

(d)   Interest shall be payable by Borrowers to Agent, for the account of Lenders, monthly in arrears not later than the first day of each calendar month commencing on October 1, 2008 and shall be calculated on the basis of a three hundred sixty (360) day year and actual days elapsed. The interest rate on non-contingent Obligations (other than Eurodollar Rate Loans) shall increase or decrease by an amount equal to each increase or decrease in the Prime Rate effective on the day any change in such Prime Rate is announced. In no event shall charges constituting interest payable by Borrowers to Agent and Lenders exceed the maximum amount or the rate permitted under any applicable law or regulation, and if any such part or provision of this Agreement is in contravention of any such law or regulation, such part or provision shall be deemed amended to conform thereto.

3.2   Fees .

(a)   Borrowers shall pay to Agent, for the account of Lenders, monthly, an unused line fee at a rate per annum determined in accordance with the table in the definition of “Applicable Margin”, calculated upon the amount by which (i) the lesser of (A) the Maximum Credit minus $5,000,000, or (B) the sum of the Accounts Sublimit plus the Equipment Sublimit minus $5,000,000, exceeds (ii) the average daily principal balance of the outstanding Loans and Letters of Credit during the immediately preceding month (or part thereof) while this Agreement is in effect and for so long thereafter as any of the Obligations are outstanding, which fee shall be payable on the first day of each month in arrears.

(b)   In the case of letters of credit, Borrowers shall pay to Agent, for the account of Lenders, a fee at a rate equal to one and one-quarter percent (1.25%) per annum on the average daily maximum amount available to be drawn under all of such Letters of Credit for the immediately preceding month (or part thereof), payable in arrears as of the first day of each succeeding month, computed for each day from the date of issuance to the date of expiration; except that Borrowers shall pay, at Agent’s option, without notice, such fee at a rate two percent (2%) greater than the otherwise applicable rate on such average daily maximum amount for: (i) the period from and after the date of termination hereof until Lenders have received full and final payment of all Obligations (notwithstanding entry of a judgment against any Borrower or Guarantor) and (ii) the period from and after the date of the occurrence of an Event of Default for so long as such Event of Default is continuing as determined by Agent. Such letter of credit fees shall be calculated on the basis of a three hundred sixty (360) day year and actual days elapsed and the obligations of Borrowers to pay such fee shall survive the termination of this Agreement. In addition to the letter of credit fees provided above, Borrowers shall pay to the issuer of any Letter of Credit a fronting fee at a rate equal to one-eighth of one percent (0.125%) per annum on the undrawn face amount of such Letter of Credit, as well as the customary charges from time to time of such issuer with respect to the issuance, amendment, transfer, administration, cancellation and conversion of, and drawings under, such Letters of Credit..

(c)   Borrowers shall pay to Agent the other fees and amounts set forth in the Fee Letter in the amounts and at the times specified therein. To the extent payment in full of the applicable fee is received by Agent from Borrowers on or about the date hereof, Agent shall pay to each Lender its share of such fees in accordance with the terms of the arrangements of Agent with such Lender.

3.3   Changes in Laws and Increased Costs of Loans .

(a)   If after the date hereof, either (i) any change in, or in the interpretation of, any law or regulation is introduced, including, without limitation, with respect to reserve requirements, applicable to any Lender or any banking or financial institution from whom any Lender borrows funds or obtains credit (a “ Funding Bank ”), or (ii) a Funding Bank or any Lender complies with any future guideline or request from any central bank or other Governmental Authority in effect after the date hereof or (iii) a Funding Bank or any Lender determines that the adoption of any applicable law, rule or regulation regarding capital adequacy, or any change therein, or any change in the interpretation or administration thereof by any Governmental Authority, central bank or comparable agency charged with the interpretation or administration thereof, in each case, as in effect after the date hereof, has or would have the effect described below, or a Funding Bank or any Lender complies with any request or directive regarding capital adequacy (whether or not having the force of law) of any such authority, central bank or comparable agency, in each case, as in effect after the date hereof, and in the case of any event set forth in this clause (iii), such adoption, change or compliance has or would have the direct or indirect effect of reducing the rate of return on any Lender’s capital as a consequence of its obligations hereunder to a level below that which such Lender could have achieved but for such adoption, change or compliance (taking into consideration the Funding Bank’s or Lender’s policies with respect to capital adequacy) by an amount deemed by such Lender to be material, and the result of any of the foregoing events described in clauses (i), (ii) or (iii) is or results in an increase in the cost to any Lender of funding or maintaining the Loans, the Letters of Credit or its Commitment, then Borrowers and Guarantors shall from time to time within 30 days of receipt of a reasonably detailed written invoice therefor pay to Agent additional amounts sufficient to indemnify such Lender against such increased cost on an after-tax basis (after taking into account applicable deductions and credits in respect of the amount indemnified). A certificate as to the amount of such increased cost shall be submitted to Borrowers by Agent and shall be presumptively correct, absent manifest error.

(b)   If prior to the first day of any Interest Period, (i) Agent shall have determined in good faith (which determination shall be presumptively correct) that, by reason of circumstances affecting the relevant market, adequate and reasonable means do not exist for ascertaining the Adjusted Eurodollar Rate for such Interest Period, (ii) Agent determines that the Adjusted Eurodollar Rate determined or to be determined for such Interest Period will not adequately and fairly reflect the cost to Lenders of making or maintaining Eurodollar Rate Loans during such Interest Period, or (iii) Dollar deposits in the principal amounts of the Eurodollar Rate Loans to which such Interest Period is to be applicable are not generally available in the London interbank market, Agent shall give telecopy or telephonic notice thereof to Borrowers as soon as practicable thereafter, and will also give prompt written notice to Borrowers when such conditions no longer exist. If such notice is given (A) any Eurodollar Rate Loans requested to be made on the first day of such Interest Period shall be made as Prime Rate Loans, (B) any Loans that were to have been converted on the first day of such Interest Period to or continued as Eurodollar Rate Loans shall be converted to or continued as Prime Rate Loans and (C) each outstanding Eurodollar Rate Loan shall be converted, on the last day of the then-current Interest Period thereof, to Prime Rate Loans. Until such notice has been withdrawn by Agent, no further Eurodollar Rate Loans shall be made or continued as such, nor shall Borrowers have the right to convert Prime Rate Loans to Eurodollar Rate Loans.

(c)   Notwithstanding any other provision herein, if the adoption of or any change in any law, treaty, rule or regulation or final, non-appealable determination of an arbitrator or a court or other Governmental Authority or in the interpretation or application thereof, in each case, occurring after the date hereof shall make it unlawful for Agent or any Lender to make or maintain Eurodollar Rate Loans as contemplated by this Agreement, (i) Agent or such Lender shall promptly give written notice of such circumstances to Borrowers (which notice shall be withdrawn whenever such circumstances no longer exist), (ii) the commitment of such Lender hereunder to make Eurodollar Rate Loans, continue Eurodollar Rate Loans as such and convert Prime Rate Loans to Eurodollar Rate Loans shall forthwith be canceled and, until such time as it shall no longer be unlawful for such Lender to make or maintain Eurodollar Rate Loans, such Lender shall then have a commitment only to make a Prime Rate Loan when a Eurodollar Rate Loan is requested and (iii) such Lender’s Loans then outstanding as Eurodollar Rate Loans, if any, shall be converted automatically to Prime Rate Loans on the respective last days of the then current Interest Periods with respect to such Loans or within such earlier period as required by law. If any such conversion of a Eurodollar Rate Loan occurs on a day which is not the last day of the then current Interest Period with respect thereto, Borrowers and Guarantors shall pay to such Lender such amounts, if any, as may be required pursuant to Section 3.3(d) below.

(d)   Borrowers and Guarantors shall indemnify Agent and each Lender and to hold Agent and each Lender harmless from any loss or expense which Agent or such Lender may sustain or incur as a consequence of (i) default by Borrowers in making a borrowing of, conversion into or extension of Eurodollar Rate Loans after Borrowers have given a notice requesting the same in accordance with the provisions of this Agreement, (ii) default by Borrowers in making any prepayment of a Eurodollar Rate Loan after Borrowers have given a notice thereof in accordance with the provisions of this Agreement, and (iii) the making of a prepayment of Eurodollar Rate Loans on a day which is not the last day of an Interest Period with respect thereto. With respect to Eurodollar Rate Loans, such indemnification may include an amount equal to the excess, if any, of (A) the amount of interest which would have accrued on the amount so prepaid, or not so borrowed, converted or extended, for the period from the date of such prepayment or of such failure to borrow, convert or extend to the last day of the applicable Interest Period (or, in the case of a failure to borrow, convert or extend, the Interest Period that would have commenced on the date of such failure) in each case at the applicable rate of interest for such Eurodollar Rate Loans provided for herein over (B) the amount of interest (as determined by Agent or such Lender) which would have accrued to Agent or such Lender on such amount by placing such amount on deposit for a comparable period with leading banks in the interbank Eurodollar market. This covenant shall survive the termination of this Agreement and the payment of the Obligations.

SECTION 4.   CONDITIONS PRECEDENT

4.1   Conditions Precedent to Effectiveness of this Agreement . Each of the following is a condition precedent to the effectiveness of this Agreement and to this Agreement amending and restating the Existing Loan Agreement in its entirety:

(a)   all requisite corporate or limited liability company action and proceedings in connection with this Agreement and the other Financing Agreements shall be reasonably satisfactory in form and substance to Agent, and Agent shall have received records of requisite corporate or limited liability company action and proceedings which Agent may have requested in connection therewith, such documents where requested by Agent or its counsel to be certified by appropriate corporate or limited liability company officers or Governmental Authority (and including a copy of the certificate of incorporation or certificate of formation, as the case may be, of each Borrower and Guarantor certified by the Secretary of State (or equivalent Governmental Authority) which shall set forth the same complete corporate or limited liability company name of such Borrower or Guarantor as is set forth herein and such document as shall set forth the organizational identification number of such Borrower or Guarantor, if one is issued in its jurisdiction of incorporation or formation);

(b)   Agent shall have received each of the following: (i) within thirty (30) days of the date hereof, a written update to the March 2008 inventory appraisal by Emerald Technology Valuations, LLC, satisfactory to Agent, which confirms there is not a decline of more than ten percent (10%) in the balanced market values since the March 2008 appraisal, and (ii) an updated field examination of the business and collateral of Borrowers and Guarantors satisfactory to Agent and in accordance with Agent’s customary procedures and practices and as otherwise required by the nature of the businesses of Borrowers and Guarantors;

(c)   to the extent not previously provided, Agent shall have received the Collateral Access Agreements, duly executed and delivered by the parties thereto;

(d)   the sum of the Excess Availability as determined by Agent, as of the date hereof, plus Qualified Cash shall be not less than $20,000,000 after giving effect to (i) the initial Loans made or to be made and Letters of Credit issued or to be issued in connection with the initial transactions hereunder and the payment of all fees and expenses with respect thereto, and (ii) the payment of the acquisition costs and all fees and expenses associated with the acquisition of Parent Guarantor by Foreign Parent Nonguarantor, provided   that , for purposes of this Section 4.1(d) only, any severance payments, in a maximum aggregate amount not to exceed $2,000,000, associated with such acquisition and made sixty (60) or more days after the Effective Date shall not be included in this calculation;

(e)   to the extent not previously provided, Agent shall have received, in form and substance satisfactory to Agent, Deposit Account Control Agreements by and among Agent, each Borrower and Guarantor, as the case may be, and each bank where such Borrower (or Guarantor) has a deposit account (other than any deposit account specifically and exclusively used for payroll, payroll taxes and other employee wage and benefit payments to or for the benefit of any Borrower’s or Guarantor’s salaried employees), in each case, duly authorized, executed and delivered by such bank and Borrower or Guarantor, as the case may be;

(f)   Agent shall have received evidence, in form and substance satisfactory to Agent, that Agent has a valid perfected first priority security interest in all of the Collateral;

(g)   (i)   Agent shall have received and reviewed lien and judgment search results for the jurisdiction of organization of each Borrower and Guarantor, the jurisdiction of the chief executive office of each Borrower and Guarantor and all jurisdictions in which assets of each Borrower and Guarantor are located, which search results shall be in form and substance satisfactory to Agent; and (ii) Agent shall have received, in form and substance reasonably satisfactory to Agent, all releases, terminations and such other documents as Agent may request to evidence and effectuate the termination by all secured parties, with a lien or security interest on any Collateral with priority over the security interest of Agent granted hereby, of their respective financing arrangements with Borrowers or any Borrower, as the case may be, and the termination and release by it or them, as the case may be, of any interest in and to any assets and properties of Borrowers or such Borrower and each Guarantor, duly authorized, executed and delivered by it or each of them, including, but not limited to, (A) UCC termination statements for all UCC financing statements previously filed by it or any of them or their predecessors, as secured party and Borrowers, any Borrower or any Guarantor, as the case may be, as debtor; and (B) satisfactions and discharges of any mortgages, deeds of trust or deeds to secure debt by Borrowers, any Borrower or any Guarantor, as the case may be, in favor of it or any of them, in form acceptable for recording with the appropriate Governmental Authority;

(h)   to the extent not previously provided, Agent shall have received completed background checks with respect to Borrowers’ and Guarantors’ prospective senior management, the results of which are satisfactory to Agent;

(i)   for verification purposes as part of the measures required by Agent pursuant to the US Patriot Act, Agent shall have received all information that Agent requests concerning each Borrower’s and each Guarantor’s identity, the results of which are satisfactory to Agent;

(j)   Agent shall have received all financial information, projections, budgets, business plans, cash flows and such other information as Agent shall request from time to time, including (i) projected quarterly balance sheets, income statements, statements of cash flows and availability of Borrowers for the period through the end of the 2009 fiscal year, (ii) projected annual balance sheets, income statements, statements of cash flows and availability of Borrowers and Guarantors through the end of the 2011 fiscal year, in each case as to the projections described in clauses (i) and (ii), with the results and assumptions set forth in all of such projections in form and substance satisfactory to Agent, and an opening pro forma balance sheet for Borrowers and Guarantors in form and substance reasonably satisfactory to Agent, (iii) consolidating projected quarterly income statements and statements of cash flows for Foreign Parent Nonguarantor and its Subsidiaries for the period through the end of the 2009 fiscal year, (iv) consolidating projected annual income statements and statement of cash flows for Foreign Parent Nonguarantor and its Subsidiaries through the end of the 2011 fiscal year, (v) any updates or modifications to the projected financial statements of Jazz and its subsidiaries previously received by Agent, in each case in form and substance reasonably satisfactory to Agent and (vi) current agings of receivables, current perpetual inventory records and/or rollforwards of accounts and inventory through the Effective Date, together with supporting documentation;

(k)   Agent shall have received evidence of insurance and loss payee endorsements required hereunder, in form and substance reasonably satisfactory to Agent, and certificates of insurance policies and/or endorsements naming Agent as loss payee;

(l)   Agent shall have received, in form and substance reasonably satisfactory to Agent, such opinion letters of counsel to Borrowers and Guarantors with respect to the Financing Agreements and such other matters as Agent may reasonably request;

(m)   Agent shall have received payment of the fees and commissions due under this Agreement through the date of the initial Loans or Letters of Credit and, to the extent invoiced, expenses incurred by Agent through such date and required to be paid by the Borrowers under Section 9.22 hereof, including all legal expenses, to the extent invoiced, incurred through the date of this Agreement;

(n)   Agent shall have received an Investment Property Control Agreement with respect to any investment account, securities account, commodity account or other similar account existing on the date hereof held by or in the name of any Borrower or Guarantor, duly executed and delivered by the parties thereto;

(o)   Agent shall have received evidence, in form and substance satisfactory to Agent, that Borrowers have obtained all necessary corporate governance, regulatory and SEC approval in connection with the acquisition of Borrowers which will be consummated substantially concurrently with the closing of the Credit Facility;

(p)   Agent shall have received and reviewed any amendments or modifications to the Agreement and Plan of Merger and Reorganization, dated May 19, 2008 (the “ Agreement and Plan of Merger ”), by and among Foreign Parent Nonguarantor, Armstrong and Parent Guarantor, made after the date of execution of such agreement, and such amendments or modifications shall be in form and substance satisfactory to Agent;

(q)   Agent shall have received evidence, in form and substance satisfactory to Agent, that Armstrong has merged with and into Parent Guarantor;

(r)   no Material Adverse Effect, and no material pending or threatened, litigation, proceeding, bankruptcy or insolvency, injunction, order or unpaid judgments with respect to Borrowers and Guarantors shall exist on the Effective Date which would constitute a default or event of default, which has not been cured or waived, under the Existing Loan Agreement; and

(s)   this Agreement and the other Financing Agreements and all instruments and documents hereunder and thereunder shall have been duly executed and delivered to Agent and shall be effective on or before October 31, 2008.

4.2   Conditions Precedent to All Loans and Letters of Credit . The obligation of Lenders to make any of the Loans, including the initial Loans, or of Agent and Lenders to arrange or provide for any Letter of Credit, including the initial Letters of Credit, is subject to the further satisfaction of, or waiver of, immediately prior to or concurrently with the making of each such Loan or the issuance of such Letter of Credit of each of the following conditions precedent:

(a)   all representations and warranties contained herein and in the other Financing Agreements shall be true and correct, in all material respects, with the same effect as though such representations and warranties had been made on and as of the date of the making of each such Loan or providing each such Letter of Credit and after giving effect thereto, except to the extent that such representations and warranties expressly relate solely to an earlier date (in which case such representations and warranties shall have been true and accurate, in all material respects, on and as of such earlier date);

(b)   no law, regulation, order, judgment or decree of any Governmental Authority shall exist, and no action, suit, investigation, litigation or proceeding shall be pending or threatened in any court or before any arbitrator or Governmental Authority, which (i) purports to enjoin, prohibit or restrain the making of the Loans or providing the Letters of Credit;

(c)   no event or condition shall exist or have occurred and be continuing since March 14, 2008 that has a reasonable likelihood of creating or resulting in a Material Adverse Effect; and

(d)   no Default or Event of Default shall exist or have occurred and be continuing since the Effective Date and on and as of the date of the making of such Loan or providing each such Letter of Credit and after giving effect thereto.

SECTION 5.   GRANT AND PERFECTION OF SECURITY INTEREST

5.1   Grant of Security Interest . To secure payment and performance of all Obligations, each Borrower and Guarantor hereby grants to Agent, for itself and the benefit of the Secured Parties, a continuing security interest in, and a lien upon, all personal property and fixtures, and interests in personal property and fixtures, of such Borrower or Guarantor, whether now owned or hereafter acquired or existing, and wherever located (together with all other collateral security for the Obligations at any time granted to or held or acquired by Agent or any Lender, collectively, the “ Collateral ”), including:

(a)   all Accounts;

(b)   all general intangibles, including, without limitation, all Intellectual Property;

(c)   all goods, including, without limitation, Inventory and Equipment;

(d)   all fixtures;

(e)   all chattel paper, including, without limitation, all tangible and electronic chattel paper;

(f)   all instruments, including, without limitation, all promissory notes;

(g)   all documents;

(h)   all deposit accounts (other than deposit accounts specifically and exclusively used for payroll, payroll taxes and other employee wage and benefit payments to or for the benefit of any Borrower’s or Guarantor’s salaried employees);

(i)   all letters of credit, banker’s acceptances and similar instruments and including all letter-of-credit rights;

(j)   all supporting obligations and all present and future liens, security interests, rights, remedies, title and interest in, to and in respect of Receivables and other Collateral, including (i) rights and remedies under or relating to guaranties, contracts of suretyship, letters of credit and credit and other insurance related to the Collateral, (ii) rights of stoppage in transit, replevin, repossession, reclamation and other rights and remedies of an unpaid vendor, lienor or secured party, (iii) goods described in invoices, documents, contracts or instruments with respect to, or otherwise representing or evidencing, Receivables or other Collateral, including returned, repossessed and reclaimed goods, and (iv) deposits by and property of account debtors or other persons securing the obligations of account debtors;

(k)   all (i) investment property (including securities, whether certificated or uncertificated, securities accounts, security entitlements, commodity contracts or commodity accounts); provided , that with respect to the Capital Stock of any Foreign Subsidiary of such Borrower or such Guarantor, the amount of such Capital Stock of such Foreign Subsidiary included as Collateral hereunder shall be limited to 65% of the Capital Stock of such Subsidiary; and (ii) monies, credit balances, deposits and other property of such Borrower or Guarantor now or hereafter held or received by or in transit to Agent, any Lender or its Affiliates or at any other depository or other institution from or for the account of any Borrower or Guarantor, whether for safekeeping, pledge, custody, transmission, collection or otherwise;

(l)   all commercial tort claims, including, without limitation, those identified in the Information Certificate;

(m)   to the extent not otherwise described above, all Receivables;

(n)   all Records; and

(o)   all products and proceeds of the foregoing, in any form, including insurance proceeds and all claims against third parties for loss or damage to or destruction of or other involuntary conversion of any kind or nature of any or all of the other Collateral.

Notwithstanding the foregoing, "Collateral" shall not include: (a) any lease, license, permit, contract, property right or agreement to which any Borrower or Guarantor is a party or under which any Borrower or Guarantor has any right or interest (including any Intellectual Property or Equipment of such Borrower or Guarantor that is the subject of such lease, license, permit, contract, property right or agreement) if and only for so long as the grant of a security interest hereunder shall constitute or result in a breach, termination or default under any such lease, license, permit, contract, property right or agreement (other than to the extent that any such term would be rendered ineffective under Sections 9406, 9407, 9408 or 9409 of the UCC or any other applicable law or principle of equity); provided , however , that such security interest shall attach immediately to any portion of such lease, license, permit, contract, property right or agreement that does not result in any of the consequences specified above in this paragraph; and (b) any Capital Stock of any Excluded Subsidiary.

5.2   Perfection of Security Interests .

(a)   Each Borrower and Guarantor irrevocably and unconditionally authorizes Agent (or its agent) to file at any time and from time to time such financing statements with respect to the Collateral naming Agent or its designee as the secured party and such Borrower or Guarantor as debtor, as Agent may require, and including any other information with respect to such Borrower or Guarantor or otherwise required by part 5 of Article 9 of the Uniform Commercial Code of such jurisdiction as may be necessary to perfect the security interest granted herein, together with any amendment and continuations with respect thereto, which authorization shall apply to all financing statements filed on, prior to or after the date hereof. Each Borrower and Guarantor hereby ratifies and approves all financing statements naming Agent or its designee as secured party and such Borrower or Guarantor, as the case may be, as debtor with respect to the Collateral (and any amendments with respect to such financing statements) filed by or on behalf of Agent prior to the date hereof and ratifies and confirms the authorization of Agent to file such financing statements (and amendments, if any). Each Borrower and Guarantor hereby authorizes Agent to adopt on behalf of such Borrower and Guarantor any symbol required for authenticating any electronic filing. In the event that the description of the collateral in any financing statement naming Agent or its designee as the secured party and any Borrower or Guarantor as debtor includes assets and properties of such Borrower or Guarantor that do not at any time constitute Collateral, whether hereunder, under any of the other Financing Agreements or otherwise, the filing of such financing statement shall nonetheless be deemed authorized by such Borrower or Guarantor to the extent of the Collateral included in such description and it shall not render the financing statement ineffective as to any of the Collateral or otherwise affect the financing statement as it applies to any of the Collateral, and each Borrower and Guarantor authorizes Agent to file a financing statement with a collateral description of "all assets" or "all personal property". Except as otherwise provided in this Agreement with respect to Agent's obligations to provide releases of Collateral or termination statements, in no event shall any Borrower or Guarantor at any time file, or permit or cause to be filed, any correction statement or termination statement with respect to any financing statement (or amendment or continuation with respect thereto) naming Agent or its designee as secured party and such Borrower or Guarantor as debtor.

(b)   None of the Borrowers or Guarantors has any chattel paper (whether tangible or electronic) or instruments as of the date hereof, except as set forth in the Information Certificate. In the event that any Borrower or Guarantor shall be entitled to or shall receive any chattel paper or instrument after the date hereof, Borrowers and Guarantors shall promptly notify Agent thereof in writing. Promptly upon the receipt thereof by or on behalf of any Borrower or Guarantor (including by any agent or representative), such Borrower or Guarantor shall deliver, or cause to be delivered to Agent, all tangible chattel paper and instruments that such Borrower or Guarantor has or may at any time acquire, accompanied by such instruments of transfer or assignment duly executed in blank as Agent may from time to time specify, in each case except as Agent may otherwise agree; provided , that, so long as no Event of Default has occurred and is continuing, Borrowers and Guarantors shall not be required to deliver to Agent up to $1,000,000 in the aggregate of any such chattel paper or instruments and instruments of transfer or assignment. At Agent’s option, each Borrower and Guarantor shall, or Agent may at any time on behalf of any Borrower or Guarantor, cause the original of any such instrument or chattel paper to be conspicuously marked in a form and manner acceptable to Agent with the following legend referring to chattel paper or instruments as applicable: “This [chattel paper][instrument] is subject to the security interest of Wachovia Capital Finance Corporation (Western) and any sale, transfer, assignment or encumbrance of this [chattel paper][instrument] violates the rights of such secured party.”; provided , that, so long as no Event of Default has occurred and is continuing, Borrowers and Guarantors shall not be required to mark up to $1,000,000 in the aggregate of any such chattel paper and instruments.

(c)   In the event that any Borrower or Guarantor shall at any time hold or acquire an interest in any electronic chattel paper or any “transferable record” (as such term is defined in Section 201 of the Federal Electronic Signatures in Global and National Commerce Act or in Section 16 of the Uniform Electronic Transactions Act as in effect in any relevant jurisdiction), such Borrower or Guarantor shall promptly notify Agent thereof in writing. Promptly upon Agent’s request, such Borrower or Guarantor shall take, or cause to be taken, such actions as Agent may request to give Agent control of such electronic chattel paper under Section 9105 of the UCC and control of such transferable record under Section 201 of the Federal Electronic Signatures in Global and National Commerce Act or, as the case may be, Section 16 of the Uniform Electronic Transactions Act, as in effect in such jurisdiction.

(d)   None of the Borrowers or Guarantors has any deposit accounts as of the date hereof, except as set forth in the Information Certificate. No Borrower or Guarantor shall, directly or indirectly, after the date hereof open, establish or maintain any deposit account unless each of the following conditions is satisfied: (i) Agent shall have received not less than five (5) Business Days prior written notice of the intention of such Borrower or Guarantor to open or establish such account which notice shall specify in reasonable detail and specificity reasonably acceptable to Agent the name of the account, the owner of the account, the name and address of the bank at which such account is to be opened or established, the individual at such bank with whom such Borrower or Guarantor is dealing and the purpose of the account, (ii) the bank where such account is opened or maintained shall be reasonably acceptable to Agent, and (iii) on or before the opening of such deposit account, such Borrower or Guarantor shall deliver to Agent a Deposit Account Control Agreement with respect to such deposit account duly authorized, executed and delivered by such Borrower or Guarantor and the bank at which such deposit account is opened and maintained. The terms of this subsection (d) shall not apply to deposit accounts specifically and exclusively used for payroll, payroll taxes and other employee wage and benefit payments to or for the benefit of any Borrower’s or Guarantor’s salaried employees. Borrowers and Guarantors shall not maintain at any one time an aggregate amount of more than One Million Dollars ($1,000,000) in deposit accounts maintained at any location outside the United States, and Agent and Lenders shall not require Borrowers and Guarantors to deliver to Agent any Deposit Account Control Agreements otherwise required under the terms of this subsection (d) with respect to such deposit accounts located outside of the United States so long as Borrowers and Guarantors are in compliance with the terms of this sentence.

(e)   None of the Borrowers or Guarantors owns or holds, directly or indirectly, beneficially or as record owner or both, any investment property, as of the date hereof, or have any investment account, securities account, commodity account or other similar account with any bank or other financial institution or other securities intermediary or commodity intermediary as of the date hereof, in each case except as set forth in the Information Certificate.

(i)   In the event that any Borrower or Guarantor shall be entitled to or shall at any time after the date hereof hold or acquire any certificated securities, such Borrower or Guarantor shall promptly endorse, assign and deliver the same to Agent, accompanied by such instruments of transfer or assignment duly executed in blank as Agent may from time to time specify. If any securities, now or hereafter acquired by such Borrower or Guarantor are uncertificated and are issued to such Borrower or Guarantor or its nominee directly by the issuer thereof, such Borrower or Guarantor shall immediately notify Agent thereof and shall (A) cause the issuer to agree to comply with instructions from Agent as to such securities, without further consent of any Borrower or Guarantor or such nominee, and (B) upon the occurrence and continuation of an Event of Default, arrange for Lender to become the registered owner of the securities.

(ii)   No Borrower or Guarantor shall, directly or indirectly, after the date hereof open, establish or maintain any investment account, securities account, commodity account or any other similar account (other than a deposit account) with any securities intermediary or commodity intermediary unless each of the following conditions is satisfied: (A) Agent shall have received not less than five (5) Business Days prior written notice of the intention of such Borrower or Guarantor to open or establish such account which notice shall specify in reasonable detail and specificity acceptable to Agent the name of the account, the owner of the account, the name and address of the securities intermediary or commodity intermediary at which such account is to be opened or established, the individual at such intermediary with whom such Borrower or Guarantor is dealing and the purpose of the account, (B) the securities intermediary or commodity intermediary (as the case may be) where such account is opened or maintained shall be acceptable to Agent, and (C) on or before the opening of such investment account, securities account or other similar account with a securities intermediary or commodity intermediary, such Borrower or Guarantor shall (i) execute and deliver, and cause to be executed and delivered to Agent, an Investment Property Control Agreement with respect thereto duly authorized, executed and delivered by such Borrower or Guarantor and such securities intermediary or commodity intermediary, and (ii) upon the occurrence and continuation of an Event of Default, arrange for Agent to become the entitlement holder with respect to such investment property on terms and conditions acceptable to Agent. The terms of this subsection (e)(ii) shall not apply to deposit accounts specifically and exclusively used for payroll, payroll taxes and other employee wage and benefit payments to or for the benefit of any Borrower’s or Guarantor’s salaried employees.

(f)   None of the Borrowers or Guarantors is the beneficiary or otherwise entitled to any right to payment under any letter of credit, banker’s acceptance or similar instrument as of the date hereof, except as set forth in the Information Certificate or on Schedule 1.59 hereof. In the event that any Borrower or Guarantor shall be entitled to or shall receive any right to payment under any letter of credit, banker’s acceptance or any similar instrument, whether as beneficiary thereof or otherwise after the date hereof, such Borrower or Guarantor shall promptly give written notice to Agent thereof; provided , that so long as no Event of Default has occurred and is continuing, Borrowers and Guarantors shall not be required to notify Agent in writing of up to $1,000,000 in the aggregate of all such letters of credit, banker’s acceptances or similar instruments. Such Borrower or Guarantor shall immediately, as Agent may specify, either: (i) prior to the occurrence of an Event of Default, use all commercially reasonable efforts to deliver, or cause to be delivered to Agent, with respect to any such letter of credit, banker’s acceptance or similar instrument with a face value in excess of $1,000,000 in the aggregate for all such letters of credit, banker’s acceptances or similar instruments, the written agreement of the issuer and any other nominated person obligated to make any payment in respect thereof (including any confirming or negotiating bank), in form and substance reasonably satisfactory to Agent, consenting to the assignment of the proceeds of the letter of credit to Agent by such Borrower or Guarantor and agreeing to make all payments thereon directly to Agent or as Agent may otherwise direct, provided , that , upon the occurrence and continuation of an Event of Default, without regard to the face value of such letters of credit, banker’s acceptances or instruments, all such written agreements of such issuer and such other nominated person obligated to make any payment in respect thereof shall be so delivered to Agent; or (ii) after an Event of Default has occurred and is continuing, cause Agent to become, at Borrowers’ expense, the transferee beneficiary of the letter of credit, banker’s acceptance or similar instrument (as the case may be).

(g)   None of the Borrowers or Guarantors has any commercial tort claims in excess of $1,000,000 as of the date hereof, except as set forth in the Information Certificate. In the event that any Borrower or Guarantor shall at any time after the date hereof have any commercial tort claims in excess of $1,000,000, such Borrower or Guarantor shall promptly notify Agent thereof in writing, which notice shall (i) set forth in reasonable detail the basis for and nature of such commercial tort claim and (ii) include the express grant by such Borrower or Guarantor to Agent of a security interest in such commercial tort claim (and the proceeds thereof). In the event that such notice does not include such grant of a security interest, the sending thereof by such Borrower or Guarantor to Agent shall be deemed to constitute such grant to Agent. Upon the sending of such notice, any commercial tort claim described therein shall constitute part of the Collateral and shall be deemed included therein. Without limiting the authorization of Agent provided in Section 5.2(a) hereof or otherwise arising by the execution by such Borrower or Guarantor of this Agreement or any of the other Financing Agreements, Agent is hereby irrevocably authorized from time to time and at any time to file such financing statements naming Agent or its designee as secured party and such Borrower or Guarantor as debtor, or any amendments to any financing statements, covering any such commercial tort claim as Collateral. In addition, each Borrower and Guarantor shall promptly upon Agent’s request, execute and deliver, or cause to be executed and delivered, to Agent such other agreements, documents and instruments as Agent may require in connection with such commercial tort claim.

(h)   None of the Borrowers or Guarantors has any goods, documents of title or other Collateral in the custody, control or possession of a third party as of the date hereof, except as set forth in the Information Certificate and except for goods located in the United States in transit to a location of a Borrower or Guarantor permitted herein in the ordinary course of business of such Borrower or Guarantor in the possession of the carrier transporting such goods. In the event that any goods, documents of title or other Collateral in excess of $1,000,000 are at any time after the date hereof in the custody, control or possession of any other person not referred to in the Information Certificate or such carriers, Borrowers and Guarantors shall promptly notify Agent thereof in writing. Promptly upon Agent’s request, Borrowers and Guarantors shall use commercially reasonably efforts deliver to Agent a Collateral Access Agreement duly authorized, executed and delivered by such person and the Borrower or Guarantor that is the owner of such Collateral; provided , that in the absence of such executed Collateral Access Agreement, Agent shall establish a Reserve in an amount equal to two (2) months of monthly bailment, carrier or other similar fees with respect to such location.

(i)   Each Borrower and Guarantor shall take any other actions reasonably requested by Agent from time to time to cause the attachment, perfection and first priority of, and the ability of Agent to enforce, the security interest of Agent in any and all of the Collateral, including, without limitation, (i) executing, delivering and, where appropriate, filing financing statements and amendments relating thereto under the UCC or other applicable law, to the extent, if any, that any Borrower's or Guarantor’s signature thereon is required therefor, (ii) causing Agent’s name to be noted as secured party on any certificate of title for a titled good if such notation is a condition to attachment, perfection or priority of, or ability of Agent to enforce, the security interest of Agent in such Collateral, (iii) complying with any provision of any statute, regulation or treaty of the United States as to any Collateral if compliance with such provision is a condition to attachment, perfection or priority of, or ability of Agent to enforce, the security interest of Agent in such Collateral, (iv) obtaining the consents and approvals of any Governmental Authority or third party, including, without limitation, any consent of any licensor, lessor or other person obligated on Collateral, upon the occurrence and continuation of an Event of Default or to the extent necessary to avoid the occurrence of a Material Adverse Effect, and taking all actions required by any earlier versions of the UCC or by other law, as applicable in any relevant jurisdiction.

SECTION 6.   COLLECTION AND ADMINISTRATION

6.1   Borrowers’ Loan Accounts . Agent shall maintain one or more loan account(s) on its books in which shall be recorded (a) all Loans, Letters of Credit and other Obligations and the Collateral, (b) all payments made by or on behalf of any Borrower or Guarantor and (c) all other appropriate debits and credits as provided in this Agreement, including fees, charges, costs, expenses and interest. All entries in the loan account(s) shall be made in accordance with Agent's customary practices as in effect from time to time.

6.2   Statements . Agent shall render to Borrowers each month a statement setting forth the balance in Borrowers’ loan account(s) maintained by Agent for Borrowers pursuant to the provisions of this Agreement, including principal, interest, fees, costs and expenses. Each such statement shall be subject to subsequent adjustment by Agent but shall, absent manifest errors or omissions, be considered presumptively correct and, absent manifest errors or omissions, deemed accepted by Borrowers and Guarantors and conclusively binding upon Borrowers and Guarantors as an account stated except to the extent that Agent receives a written notice from Borrowers of any specific exceptions of Borrowers thereto within thirty (30) days after the date such statement has been mailed by Agent. Until such time as Agent shall have rendered to Borrowers a written statement as provided above, the balance in any Borrower's loan account(s) shall be presumptive evidence of the amounts due and owing to Agent and Lenders by Borrowers and Guarantors.

6.3   Collection of Accounts .

(a)   Subject to Section 6.3(d) below, Borrowers shall establish and maintain, at their expense, blocked accounts or lockboxes and related blocked accounts (in either case, “ Blocked Accounts ”), as Agent may specify, with such banks as are reasonably acceptable to Agent into which Borrowers shall promptly deposit and direct its account debtors to directly remit all payments on Receivables and all payments constituting proceeds of Inventory or other Collateral in the identical form in which such payments are made, whether by cash, check or other manner. Borrowers shall deliver, or cause to be delivered to Agent a Deposit Account Control Agreement duly authorized, executed and delivered by each bank where a Blocked Account is maintained as provided in Section 5.2 hereof (which agreement shall provide that upon notice from Agent (which shall be given upon the occurrence of any event set forth in Sections 6.3(d)(i) or 6.3(d)(ii) below, as applicable), such bank will send funds on a daily basis to the Agent Payment Account and otherwise take instructions with respect to such Blocked Account only from Agent), or at any time following the occurrence of any event set forth in Sections 6.3(d)(i) or 6.3(d)(ii) below, Agent may become the bank’s customer with respect to any of the Blocked Accounts and promptly upon Agent’s request, Borrowers shall execute and deliver such agreements and documents as Agent may require in connection therewith. Upon the occurrence of any event set forth in Section 6.3(d) below, each Borrower and Guarantor agrees that all payments made to such Blocked Accounts or other funds received and collected by Agent or any Lender, whether in respect of the Receivables, as proceeds of Inventory or other Collateral or otherwise shall be treated as payments to Agent and Lenders in respect of the Obligations and therefore shall constitute the property of Agent and Lenders to the extent of the then outstanding Obligations.

(b)   Upon the occurrence of any event set forth in Section 6.3(d) below, for purposes of calculating the amount of the Loans available to each Borrower, such payments will be applied (conditional upon final collection) to the Obligations on the Business Day of receipt by Agent of immediately available funds in the Agent Payment Account provided such payments and notice thereof are received in accordance with Agent’s usual and customary practices as in effect from time to time and within sufficient time to credit such Borrower's loan account on such day, and if not, then on the next Business Day.

(c)   Upon the occurrence of any event set forth in Section 6.3(d) below, each Borrower and Guarantor and their respective employees, agents and Subsidiaries shall, acting as trustee for Agent, receive, as the property of Agent, any monies, checks, notes, drafts or any other payment relating to and/or proceeds of Accounts or other Collateral which come into their possession or under their control and immediately upon receipt thereof, shall deposit or cause the same to be deposited in the Blocked Accounts, or remit the same or cause the same to be remitted, in kind, to Agent. In no event shall the same be commingled with any Borrower's or Guarantor’s own funds. Borrowers agree, upon the occurrence of any event set forth in Section 6.3(d) below, to reimburse Agent on demand for any amounts owed or paid to any bank or other financial institution at which a Blocked Account or any other deposit account or investment account is established or any other bank, financial institution or other person involved in the transfer of funds to or from the Blocked Accounts arising out of Agent 's payments to or indemnification of such bank, financial institution or other person. The obligation of Borrowers to reimburse Agent for such amounts pursuant to this Section 6.3 shall survive the termination of this Agreement.

(d)   Notwithstanding the foregoing in this Section 6.3, Agent shall exercise control over the Blocked Accounts and shall be entitled to receive payments on and/or proceeds of Accounts only in the event that (i) the aggregate outstanding amount of Loans and Letter of Credit Obligations shall be equal to or greater than $30,000,000 for any period of three (3) consecutive Business Days, or (ii) an Event of Default has occurred and is continuing. Following any exercise of control by Agent over the Blocked Accounts pursuant to clause (i) of this Section 6.3(d), Agent shall relinquish such control over the Blocked Accounts if at all times during a period thereafter of ninety (90) calendar days, the aggregate outstanding amount of Loans and Letter of Credit Obligations is less than $30,000,000.

6.4   Payments .

(a)   All Obligations shall be payable to the Agent Payment Account as provided in Section 6.3 or such other place as Agent may designate from time to time. Subject to the other terms and conditions contained herein, Agent shall apply payments received or collected from any Borrower or Guarantor or for the account of any Borrower or Guarantor (including the monetary proceeds of collections or of realization upon any Collateral) as follows: first , to pay any fees, indemnities or expense reimbursements then due to Agent and Lenders from any Borrower or Guarantor and any Obligations due with respect to Bank Products to the extent reserved from the Borrowing Base; second , to pay interest due in respect of any Loans or Letter of Credit Obligations; third , to pay principal due in respect of any Loans and Letter of Credit Obligations; fourth , to pay or prepay any other Obligations whether or not then due, in such order and manner as Agent determines and at any time an Event of Default exists or has occurred and is continuing, to provide cash collateral for any Letter of Credit Obligations; fifth , to pay any Obligations due with respect to Bank Products to the extent not reserved from the Borrowing Base. Notwithstanding anything to the contrary contained in this Agreement, unless so directed by Borrowers, or unless a Default or an Event of Default shall exist or have occurred and be continuing, Agent shall not apply any payments which it receives to any Eurodollar Rate Loans, except (A) on the expiration date of the Interest Period applicable to any such Eurodollar Rate Loans or (B) in the event that there are no outstanding Prime Rate Loans.

(b)   At Agent 's option, all principal, interest, fees (except for payments of fees and disbursements of counsel as may be limited by Section 9.22(g)), costs, expenses and other charges provided for in this Agreement and then due and payable or the other Financing Agreements may be charged directly to the loan account(s) of any Borrower maintained by Agent. Borrowers shall make all payments to Agent on the Obligations free and clear of, and without deduction or withholding for or on account of, any setoff, counterclaim or defense of any kind. If after receipt of any payment of, or proceeds of Collateral applied to the payment of, any of the Obligations, Agent or any Lender is required to surrender or return such payment or proceeds to any Person for any reason, then the Obligations intended to be satisfied by such payment or proceeds shall be reinstated and continue and this Agreement shall continue in full force and effect as if such payment or proceeds had not been received by Agent or such Lender. Borrowers and Guarantors shall be liable to pay to Agent, and do hereby indemnify and hold Agent and Lenders harmless for the amount of any payments or proceeds surrendered or returned. This Section 6.4 shall remain effective notwithstanding any contrary action which may be taken by Agent or any Lender in reliance upon such payment or proceeds. This Section 6.4 shall survive the payment of the Obligations and the termination of this Agreement.

(c)   Except as otherwise required by applicable law or as provided in this Agreement, each Borrower and Guarantor shall make all payments to each Lender on the Obligations free and clear of, and without deduction or withholding for, any present or future taxes, levies, imposts, duties, charges, fees deductions withholdings now or hereafter imposed, levied, collected, withheld or assessed by any Governmental Authority, excluding net income taxes, net profits, capital taxes and franchise taxes (imposed in lieu of income taxes) and any branch profits taxes imposed by the United States or any similar tax imposed on any Lender as a result of a present or former connection between such Lender and the Governmental Authority imposing such tax or any political subdivision or taxing authority thereof (other than any such connection arising solely from such Lender having executed, delivered and performed its obligations or received a payment under, or enforced, this Agreement). If any such non-excluded taxes, levies, imposts, duties, charges, fees, deductions or withholdings (“ Non-Excluded Taxes ”) are required to be withheld from any amounts payable by the relevant Borrower or Guarantor to a Lender hereunder, (i) the amounts so payable to such Lender shall be increased to the extent necessary to yield to such Lender (after payment of all Non-Excluded Taxes and Other Taxes) interest or any such other amounts payable hereunder at the rates or in the amounts specified in this Agreement, (ii) the Borrowers and Guarantors shall make such deductions and (iii) the Borrowers and Guarantors shall pay the full amount deducted to the relevant Governmental Authority in accordance with applicable law, provided , however , that no Borrower or Guarantor shall be required to increase any amounts payable to a Lender with respect to any Non-Excluded Taxes, and each Borrower and Guarantor shall be permitted to withhold any Non-Excluded Taxes, (A) that are attributable to such Lender’s failure to comply with the requirements of paragraphs (e) or (f) of this Section or (B) that are United States withholding taxes that are in effect and apply to amounts payable to a Lender at the time such Lender becomes a party to this Agreement. The Borrowers and Guarantors shall pay any Other Taxes to the relevant Governmental Authority in accordance with applicable law.

(d)   Whenever any Non-Excluded Taxes or Other Taxes are payable by a Borrower or Guarantor to a Governmental Authority, as promptly as possible thereafter the relevant Borrower or Guarantor shall send to each Lender a copy of an original official receipt received by the Borrower or Guarantor showing payment thereof. If such Borrower or Guarantor fails to pay any Non-Excluded Taxes or Other Taxes when due to the appropriate taxing authority or fails to remit to each Lender the required receipts or other required documentary evidence, the Borrowers and Guarantors shall indemnify each Lender for any incremental taxes, interest or penalties that become payable by the Lender as a result of such failure. The determination of whether any Non-Excluded Taxes are due to be paid by a Borrower or Guarantor shall be based on the forms that are provided to the Borrowers and Guarantors pursuant to Sections 6.4(e) and (f) hereof and the Borrowers and Guarantors shall not be obligated to indemnify any Lender for any amounts under this Section if such forms are not properly completed and duly executed.

(e)   Each Lender (including an assignee of a Lender) that is not a United States person (as such term is defined in Section 7701(a)(3) of the Code (a “ Non-U.S. Lender ”) shall deliver to the Borrowers, as provided below, (i) two accurate and complete copies of IRS Form W-8ECI or W-8BEN, or, (ii) in the case of a Non-U.S. Lender claiming exemption from United States federal withholding tax under Sections 871(h) or 881(c) of the Code with respect to payments of “portfolio interest”, a statement substantially in the form of Exhibit E hereof and two accurate and complete copies of IRS Form W-8BEN, or any subsequent versions or successors to such forms, in each case properly completed and duly executed by such Non-U.S. Lender claiming complete exemption from, or a reduced rate of, United States federal withholding tax on all Obligations. Such forms shall be delivered by each Non-U.S. Lender on or before the date it becomes a party to this Agreement. In addition, each Non-U.S. Lender shall deliver such forms promptly upon the obsolescence or invalidity of any form previously delivered by such Non-U.S. Lender. In addition, each Non-U.S. Lender agrees that it will deliver to the Borrowers, within a reasonable time after a request therefor, updated versions of the foregoing documentation and such other forms as may be required to confirm or establish the entitlement of a Non-U.S. Lender to a continued exemption from, or reduction in withholding tax. Each Non-U.S. Lender shall promptly notify the Borrowers at any time it determines that it is no longer in a position to provide any previously delivered certificate to the Borrowers (or any other form of certification adopted by the United States taxing authority for such purpose). Notwithstanding any other provision of this paragraph, a Non-U.S. Lender shall not be required to deliver any form pursuant to this paragraph that such Non-U.S. Lender is not legally available to deliver.

(f)   Each Lender (including an assignee of a Lender) that is a United States person as defined in Section 7701(a)(30) of the Code shall deliver to the Borrowers, on or before such Lender becomes a party to this Agreement, two accurate and complete copies of IRS Form W-9 (or successor form) establishing that the Lender is a United States person and is not subject to backup withholding. In addition, each Lender that is a United States person shall deliver such forms promptly upon the obsolescence or invalidity of any form previously delivered by such Lender. In addition, each Lender that is a United States person agrees that it will deliver to the Borrowers, within a reasonable time after a request therefor, updated versions of the foregoing documentation and such other forms as may be required to confirm or establish the entitlement of a Lender to a continued exemption from withholding tax.

(g)   If a Lender determines in its reasonable judgment that it has received a refund of any Non-Excluded Taxes, Other Taxes or other amounts as to which it has been indemnified by the Borrowers or with respect to which the Borrowers have paid additional amounts pursuant to this Section 6.4, it shall pay over such refund to the relevant Borrower (but only to the extent of indemnity payments made, or additional amounts paid, by the Borrower under this Section 6.4 with respect to Non-Excluded Taxes or Other Taxes giving rise to such refund) net of all out-of-pocket expenses of the Lender and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund), provided , that the Borrowers, upon the request of such Lender, agree to repay the amount paid over the Borrowers to such Lender in the event such Lender is required to repay such refund to such Governmental Authority. This paragraph shall not be construed to require any Lender to make available its tax return (or any other information relating to its taxes which it considers confidential) to the Borrowers.

6.5   Authorization to Make Loans . Agent and Lenders are authorized to make the Loans based upon telephonic or other instructions received from anyone purporting to be an officer of any Borrower or other authorized person or, at the discretion of Agent, if such Loans are necessary to satisfy any Obligations then due and payable (except for payments of fees and disbursements of counsel as may be limited by Section 9.22(g)). All requests for Loans or Letters of Credit hereunder shall specify the date on which the requested advance is to be made (which day shall be a Business Day) and the amount of the requested Loan. Requests received after 11:00 a.m. Pasadena, California time on any day shall be deemed to have been made as of the opening of business on the immediately following Business Day. All Loans and Letters of Credit under this Agreement shall be conclusively presumed to have been made to, and at the request of and for the benefit of, any Borrower or Guarantor when deposited to the credit of any Borrower or Guarantor or otherwise disbursed or established in accordance with the instructions of any Borrower or Guarantor or in accordance with the terms and conditions of this Agreement.

6.6   Use of Proceeds . Borrowers shall use the initial proceeds of the Loans and Letters of Credit hereunder only for: (a) payments to each of the persons listed in the disbursement direction letter furnished by Borrowers to Agent on or about the date hereof, (b) costs, expenses and fees in connection with the preparation, negotiation, execution and delivery of this Agreement and the other Financing Agreements, and (c) costs, expenses and fees in connection with the acquisition of Parent Guarantor by Foreign Parent Nonguarantor. All other Loans made or Letters of Credit provided by Agent and Lenders to or for the benefit of any Borrower pursuant to the provisions hereof shall be used by such Borrower only for general operating, working capital, capital expenditure and other proper corporate purposes of Borrower not otherwise prohibited by the terms hereof, including, without limitation, permitted investments and permitted acquisitions. None of the proceeds will be used, directly or indirectly, for the purpose of purchasing or carrying any margin security or for the purposes of reducing or retiring any indebtedness which was originally incurred to purchase or carry any margin security or for any other purpose which might cause any of the Loans to be considered a “purpose credit” within the meaning of Regulation U of the Board of Governors of the Federal Reserve System, as amended.

6.7   Pro Rata Treatment . Except to the extent otherwise provided in this Agreement or as otherwise agreed by Lenders: (a) the making and conversion of Loans shall be made among the Lenders based on their respective Pro Rata Shares as to the Loans and (b) each payment on account of any Obligations to or for the account of one or more of Lenders in respect of any Obligations due on a particular day shall be allocated among the Lenders entitled to such payments based on their respective Pro Rata Shares and shall be distributed accordingly.

6.8   Sharing of Payments, Etc .

(a)   Each Borrower and Guarantor agrees that, in addition to (and without limitation of) any right of setoff, banker's lien or counterclaim Agent or any Lender may otherwise have, each Lender shall be entitled, at its option (but subject, as among Agent and Lenders, to the provisions o