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CREDIT AGREEMENT
THQ INC.
as Borrower,
THE LENDERS THAT ARE SIGNATORIES HERETO
as the Lenders,
and
WELLS FARGO CAPITAL FINANCE, LLC
as the Administrative Agent, Sole Lead Arranger and Collateral Agent
Dated as of September 23, 2011

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TABLE OF CONTENTS
 
 
 
 
Page
1.
DEFINITIONS AND CONSTRUCTION
1
 
1.1
Definitions
 
1
 
1.2
Accounting Terms
 
1
 
1.3
Code
 
1
 
1.4
Construction
 
1
 
1.5
Schedules and Exhibits
 
2
 
 
 
 
 
2.
LOANS AND TERMS OF PAYMENT
2
 
2.1
Revolver Advances
 
2
 
2.2
Reserved
 
3
 
2.3
Borrowing Procedures and Settlements
3
 
2.4
Payments; Reductions of Commitments; Prepayments
8
 
2.5
Overadvances
 
10
 
2.6
Interest Rates and Letter of Credit Fee: Rates, Payments, and Calculations
11
 
2.7
Crediting Payments
 
12
 
2.8
Designated Account
 
12
 
2.9
Maintenance of Loan Account; Statements of Obligations
12
 
2.10
Fees
 
13
 
2.11
Letters of Credit
 
14
 
2.12
LIBOR Option
 
17
 
2.13
Capital Requirements
 
19
 
 
 
 
 
3.
CONDITIONS; TERM OF AGREEMENT
21
 
3.1
Conditions Precedent to the Initial Extension of Credit
21
 
3.2
Conditions Precedent to all Extensions of Credit
21
 
3.3
Maturity
21
 
3.4
Effect of Maturity
22
 
3.5
Early Termination by Borrower
22
 
3.6
Conditions Subsequent
22
 
 
 
 
 
4.
REPRESENTATIONS AND WARRANTIES
22
 
4.1
Due Organization and Qualification; Subsidiaries
22
 
4.2
Due Authorization; No Conflict
23
 
4.3
Governmental Consents
23
 
4.4
Binding Obligations; Perfected Liens
23
 
4.5
Title to Assets; No Encumbrances
24
 
4.6
Jurisdiction of Organization; Location of Chief Executive Office; Organizational
Identification Number; Commercial Tort Claims
24
 
4.7
Litigation
24

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TABLE OF CONTENTS
(continued)
 
 
 
 
Page
 
4.8
Compliance with Laws
25
 
4.9
No Material Adverse Change
25
 
4.10
Fraudulent Transfer
25
 
4.11
Employee Benefits
25
 
4.12
Environmental Condition
25
 
4.13
Intellectual Property
26
 
4.14
Leases
26
 
4.15
Deposit Accounts and Securities Accounts
26
 
4.16
Complete Disclosure
26
 
4.17
Designated Contracts
 
26
 
4.18
Patriot Act
 
27
 
4.19
Indebtedness
 
27
 
4.20
Payment of Taxes
 
27
 
4.21
Margin Stock
 
27
 
4.22
Governmental Regulation
27
 
4.23
OFAC
 
27
 
4.24
Employee and Labor Matters
28
 
4.25
Eligible Accounts
 
28
 
4.26
Eligible Inventory
 
28
 
4.27
Locations of Inventory and Equipment
28
 
4.28
Inventory Records
 
28
 
4.29
Eligible Titles
 
28
 
4.30
Inactive Subsidiaries
 
29
 
4.31
JAKKS Agreements
 
29
 
4.32
Intellectual Property Claims
29
 
4.33
No Defaults
 
29
 
 
 
 
 
5.
AFFIRMATIVE COVENANTS
29
 
5.1
Financial Statements, Reports, Certificates
29
 
5.2
Collateral Reporting
29
 
5.3
Existence
29
 
5.4
Maintenance of Properties
30
 
5.5
Taxes
30
 
5.6
Insurance
30
 
5.7
Inspection
 
30
 
5.8
Compliance with Laws
 
31
 
5.9
Environmental
 
31
 
5.10
Disclosure Updates
 
31
 
5.11
Formation of Subsidiaries
31
 
5.12
Further Assurances
 
32
 
5.13
Lender Meetings
 
32

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TABLE OF CONTENTS
(continued)
 
 
 
 
Page
 
5.14
Designated Contracts
 
32
 
5.15
Location of Inventory and Equipment
33
 
5.16
Reserved
 
33
 
5.17
Reserved
 
33
 
5.18
Intellectual Property Licenses
33
 
 
 
 
 
6.
NEGATIVE COVENANTS
33
 
6.1
Indebtedness
 
33
 
6.2
Liens
 
33
 
6.3
Restrictions on Fundamental Changes
33
 
6.4
Disposal of Assets
 
34
 
6.5
Change Name
 
34
 
6.6
Nature of Business
 
34
 
6.7
Prepayments and Amendments.
34
 
6.8
Change of Control
 
35
 
6.9
Restricted Junior Payments
35
 
6.10
Accounting Methods
 
35
 
6.11
Investments; Controlled Investments
35
 
6.12
Transactions with Affiliates
36
 
6.13
Use of Proceeds
36
 
6.14
Limitation on Issuance of Stock
36
 
6.15
Consignments
37
 
6.16
Inventory and Equipment with Bailees
37
 
6.17
Inactive Subsidiaries
37
 
 
 
 
 
7.
FINANCIAL COVENANTS
37
 
 
 
8.
EVENTS OF DEFAULT
39
 
 
 
9.
RIGHTS AND REMEDIES
40
 
9.1
Rights and Remedies
 
40
 
9.2
Remedies Cumulative
 
41
 
 
 
 
 
10.
WAIVERS; INDEMNIFICATION
41
 
10.1
Demand; Protest; etc
41
 
10.2
The Lender Group's Liability for Collateral
41
 
10.3
Indemnification
41
 
 
 
 
 
11.
NOTICES
42

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TABLE OF CONTENTS
(continued)
 
 
 
 
Page
12.
CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER
43
 
 
 
13.
ASSIGNMENTS AND PARTICIPATIONS; SUCCESSORS
44
 
13.1
Assignments and Participations
44
 
13.2
Successors
 
46
 
 
 
 
 
14.
AMENDMENTS; WAIVERS
46
 
14.1
Amendments and Waivers
46
 
14.2
Replacement of Certain Lenders
48
 
14.3
No Waivers; Cumulative Remedies
48
 
 
 
 
 
15.
AGENT; THE LENDER GROUP
49
 
15.1
Appointment and Authorization of Agent
49
 
15.2
Delegation of Duties
 
49
 
15.3
Liability of Agent
 
50
 
15.4
Reliance by Agent
 
50
 
15.5
Notice of Default or Event of Default
50
 
15.6
Credit Decision
 
50
 
15.7
Costs and Expenses; Indemnification
51
 
15.8
Agent in Individual Capacity
52
 
15.9
Successor Agent
 
52
 
15.10
Lender in Individual Capacity
52
 
15.11
Collateral Matters
 
53
 
15.12
Restrictions on Actions by Lenders; Sharing of Payments
54
 
15.13
Agency for Perfection
 
54
 
15.14
Payments by Agent to the Lenders
54
 
15.15
Concerning the Collateral and Related Loan Documents
55
 
15.16
Audits and Examination Reports; Confidentiality; Disclaimers by Lenders; Other
Reports and Information
55
 
15.17
Several Obligations; No Liability
56
 
 
 
 
 
16.
WITHHOLDING TAXES
56
 
 
 
 
 
17.
GENERAL PROVISIONS
58
 
17.1
Effectiveness
 
58
 
17.2
Section Headings
 
58
 
17.3
Interpretation
 
58
 
17.4
Severability of Provisions
58

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TABLE OF CONTENTS
(continued)
 
 
 
 
Page
 
17.5
Bank Product Providers
 
59
 
17.6
Debtor-Creditor Relationship
59
 
17.7
Counterparts; Electronic Execution
59
 
17.8
Revival and Reinstatement of Obligations
59
 
17.9
Confidentiality
 
60
 
17.10
Lender Group Expenses
 
61
 
17.11
Survival
 
61
 
17.12
Patriot Act
 
61
 
17.13
Integration
 
61
 
 
 
 
 

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Table of Contents
(continued)
                                                
EXHIBITS AND SCHEDULES

Exhibit A-1        Form of Assignment and Acceptance
Exhibit B-1        Form of Borrowing Base Certificate
Exhibit B-2        Form of Bank Product Provider Letter Agreement
Exhibit C-1        Form of Compliance Certificate
Exhibit I-1        Form of IP Reporting Certificate
Exhibit L-1        Form of LIBOR Notice
Schedule A-1        Agent's Account
Schedule A-2        Authorized Persons
Schedule C-1        Revolver Commitments
Schedule D-1        Designated Account
Schedule E-1        Locations of Eligible Inventory
Schedule P-1        Permitted Investments
Schedule P-2        Permitted Liens
Schedule R-1        Real Property Collateral
Schedule 1.1        Definitions
Schedule 3.1        Conditions Precedent
Schedule 3.6        Conditions Subsequent
Schedule 4.1(b)        Capitalization of Borrower
Schedule 4.1(c)        Capitalization of Borrower's Subsidiaries
Schedule 4.5        Disposition of Assets
Schedule 4.6(a)        States of Organization
Schedule 4.6(b)        Chief Executive Offices
Schedule 4.6(c)        Organizational Identification Numbers
Schedule 4.6(d)        Commercial Tort Claims
Schedule 4.7(b)        Material Litigation
Schedule 4.9        Material Adverse Changes
Schedule 4.12        Environmental Matters
Schedule 4.15        Deposit Accounts and Securities Accounts
Schedule 4.17        Designated Contracts
Schedule 4.19        Permitted Indebtedness
Schedule 4.27        Locations of Inventory and Equipment
Schedule 4.32        Intellectual Property Claims
Schedule 4.33        Defaults
Schedule 5.1        Financial Statements, Reports, Certificates
Schedule 5.2        Collateral Reporting
Schedule 6.6        Nature of Business

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CREDIT AGREEMENT
THIS CREDIT AGREEMENT (this “Agreement”), is entered into as of September 23,
2011, by and among the lenders identified on the signature pages hereof (each of
such lenders, together with their respective successors and permitted assigns,
are referred to hereinafter as a “Lender”, as that term is hereinafter further
defined), WELLS FARGO CAPITAL FINANCE, LLC, a Delaware limited liability
company, as administrative agent for the Lenders (in such capacity, together
with its successors and assigns in such capacity, “Agent”) and collateral agent
and sole lead arranger for the Lenders, and THQ INC., a Delaware corporation
(“Borrower”).
The parties agree as follows:
1.
DEFINITIONS AND CONSTRUCTION.

1.1Definitions. Capitalized terms used in this Agreement shall have the meanings
specified therefor on Schedule 1.1.

1.2Accounting Terms. All accounting terms not specifically defined herein shall
be construed in accordance with GAAP; provided, however, that if Borrower
notifies Agent that Borrower requests an amendment to any provision hereof to
eliminate the effect of any Accounting Change occurring after the Closing Date
or in the application thereof on the operation of such provision (or if Agent
notifies Borrower that the Required Lenders request an amendment to any
provision hereof for such purpose), regardless of whether any such notice is
given before or after such Accounting Change or in the application thereof, then
Agent and Borrower agree that they will negotiate in good faith amendments to
the provisions of this Agreement that are directly affected by such Accounting
Change with the intent of having the respective positions of the Lenders and
Borrower after such Accounting Change conform as nearly as possible to their
respective positions as of the date of this Agreement and, until any such
amendments have been agreed upon and agreed to by the Required Lenders, the
provisions in this Agreement shall be calculated as if no such Accounting Change
had occurred. When used herein, the term “financial statements” shall include
the notes and schedules thereto, if applicable. Whenever the term “Borrower” is
used in respect of a financial covenant or a related definition, it shall be
understood to mean Borrower and its Subsidiaries on a consolidated basis, unless
the context clearly requires otherwise.

1.3Code. Any terms used in this Agreement that are defined in the Code shall be
construed and defined as set forth in the Code unless otherwise defined herein;
provided, however, that to the extent that the Code is used to define any term
herein and such term is defined differently in different Articles of the Code,
the definition of such term contained in Article 9 of the Code shall govern.

1.4Construction. Unless the context of this Agreement or any other Loan Document
clearly requires otherwise, references to the plural include the singular,
references to the singular include the plural, the terms “includes” and
“including” are not limiting, and the term “or” has, except where otherwise
indicated, the inclusive meaning represented by the phrase “and/or.” The words
“hereof,” “herein,” “hereby,” “hereunder,” and similar terms in this Agreement
or any other Loan Document refer to this Agreement or such other Loan Document,
as the case may be, as a whole and not to any particular provision of this
Agreement or such other Loan Document, as the case may be. Section, subsection,
clause, schedule, and exhibit references herein are to this Agreement unless
otherwise specified. Any reference in this Agreement or in any other Loan
Document to any agreement, instrument, or document shall include all
alterations, amendments, changes, extensions, modifications, renewals,
replacements, substitutions, joinders, and supplements, thereto and thereof, as
applicable (subject to any restrictions on such alterations, amendments,
changes, extensions, modifications, renewals, replacements, substitutions,
joinders, and supplements set forth herein). The words “asset” and “property”
shall be construed to have the same meaning and effect and to refer to any and
all tangible and intangible assets and properties. Any reference herein or in
any other Loan Document to the satisfaction, repayment, or payment in full of
the Obligations shall mean the repayment in full in cash or immediately
available funds (or, (a) in the case of contingent reimbursement obligations
with respect to Letters of Credit, providing Letter of Credit Collateralization,
and (b) in the case of obligations with respect to Bank Products (other than
Hedge Obligations), providing Bank Product Collateralization) of all of the
Obligations (including the payment of any Lender Group Expenses that have
accrued irrespective of whether demand has been made therefor and the payment of
any termination amount then applicable (or which would or could become
applicable as a result of the repayment of the other Obligations) under Hedge
Agreements provided by Hedge Providers) other than (i) unasserted contingent
indemnification Obligations, (ii) any Bank Product Obligations (other than Hedge
Obligations) that, at such time, are allowed by the applicable Bank Product

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Provider to remain outstanding without being required to be repaid or cash
collateralized, and (iii) any Hedge Obligations that, at such time, are allowed
by the applicable Hedge Provider to remain outstanding without being required to
be repaid. Any reference herein to any Person shall be construed to include such
Person's successors and assigns. Any requirement of a writing contained herein
or in any other Loan Document shall be satisfied by the transmission of a
Record.

1.5Schedules and Exhibits. All of the schedules and exhibits attached to this
Agreement shall be deemed incorporated herein by reference.

2.
LOANS AND TERMS OF PAYMENT.

2.1
Revolver Advances.

(a)Subject to the terms and conditions of this Agreement, and during the term of
this Agreement, each Lender with a Revolver Commitment agrees (severally, not
jointly or jointly and severally) to make revolving loans (“Advances”) to
Borrower in an amount at any one time outstanding not to exceed the lesser of:

(i)such Lender's Revolver Commitment, or

(ii)such Lender's Pro Rata Share of an amount equal to the lesser of:

1.the Maximum Revolver Amount less the sum of (1) the Letter of Credit Usage at
such time, plus (2) the principal amount of Swing Loans outstanding at such
time, and

2.the Borrowing Base at such time less the sum of (1) the Letter of Credit Usage
at such time, plus (2) the principal amount of Swing Loans outstanding at such
time.

(b)Amounts borrowed pursuant to this Section 2.1 may be repaid and, subject to
the terms and conditions of this Agreement, reborrowed at any time during the
term of this Agreement. The outstanding principal amount of the Advances,
together with interest accrued and unpaid thereon, shall be due and payable on
the Maturity Date or, if earlier, on the date on which they are declared due and
payable pursuant to the terms of this Agreement. Amounts borrowed pursuant to
this Section 2.1 and interest accruing thereon shall be evidenced by the records
of Agent and the applicable Lender. At the request of any Lender, Borrower shall
deliver a Revolver Note to such Lender.

(c)Anything to the contrary in this Section 2.1 notwithstanding, Agent shall
have the right (but not the obligation) to establish, increase, reduce,
eliminate, or otherwise adjust reserves from time to time against the Borrowing
Base or the Maximum Revolver Amount in such amounts, and with respect to such
matters, as Agent in its Permitted Discretion shall deem necessary or
appropriate, including (i) reserves in an amount equal to the Bank Product
Reserve Amount, (ii) reserves with respect to (A) sums that Borrower or its
Subsidiaries are required to pay under this Agreement or any other Loan Document
(such as taxes, assessments, or insurance premiums, or in the case of leased
assets, rents or other amounts payable under such leases) and has failed to pay
when due, and (B) amounts owing by Borrower or its Subsidiaries to any Person to
the extent secured by a Lien on, or trust over, any of the Collateral (other
than a Permitted Lien which is a permitted purchase money Lien or the interest
of a lessor under a Capital Lease), which Lien or trust, in the Permitted
Discretion of Agent likely would have a priority superior to Agent's Liens (such
as Liens or trusts in favor of landlords, warehousemen, carriers, mechanics,
materialmen, bailees, processors, laborers, or suppliers, or Liens or trusts for
ad valorem, excise, sales, or other taxes where given priority under applicable
law) in and to such item of the Collateral, (iii) reserves with respect to all
amounts owed or payable to Technicolor by Borrower or any other Loan Party, (iv)
reserves with respect to Royalties, and (v) reserves with respect to exposure to
fluctuations in the conversion rate between Canadian dollars and Dollars
relating to Accounts payable in Canadian dollars.
  
2.2Reserved.

2.3Borrowing Procedures and Settlements.

(a)Procedure for Borrowing. Each Borrowing shall be made by a written request by
an Authorized Person delivered to Agent. Unless Swing Lender is not obligated to
make a Swing Loan pursuant to Section 2.3(b) below, such notice must be received
by Agent no later than 10:00 a.m. (California time) on the Business Day that is
the requested Funding Date specifying (i) the amount of such Borrowing, and (ii)
the requested Funding Date, which shall be a Business Day; provided, however,
that if Swing Lender is not obligated to make a Swing Loan as to a requested
Borrowing, such notice must be received by Agent no later than 10:00 a.m.
(California time) on the Business Day prior to the date that is the requested
Funding Date. At Agent's election, in lieu of delivering the above-described
written request, any Authorized Person may give Agent telephonic

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notice of such request by the required time. In such circumstances, Borrower
agrees that any such telephonic notice will be confirmed in writing within 24
hours of the giving of such telephonic notice, but the failure to provide such
written confirmation shall not affect the validity of the request.

(b)Making of Swing Loans. In the case of a request for an Advance and so long as
either (i) the aggregate amount of Swing Loans made since the last Settlement
Date, minus the amount of Collections or payments applied to Swing Loans since
the last Settlement Date, plus the amount of the requested Advance does not
exceed $5,000,000, or (ii) Swing Lender, in its sole discretion, shall agree to
make a Swing Loan notwithstanding the foregoing limitation, Swing Lender shall
make an Advance in the amount of such requested Borrowing (any such Advance made
solely by Swing Lender pursuant to this Section 2.3(b) being referred to as a
“Swing Loan” and such Advances being referred to as “Swing Loans”) available to
Borrower on the Funding Date applicable thereto by transferring immediately
available funds to the Designated Account. Anything contained herein to the
contrary notwithstanding, the Swing Lender may, but shall not be obligated to,
make Swing Loans at any time that one or more of the Lenders is a Defaulting
Lender. Each Swing Loan shall be deemed to be an Advance hereunder and shall be
subject to all the terms and conditions (including Section 3) applicable to
other Advances, except that all payments on any Swing Loan shall be payable to
Swing Lender solely for its own account. Subject to the provisions of Section
2.3(d)(ii), Swing Lender shall not make and shall not be obligated to make any
Swing Loan if Swing Lender has actual knowledge that (i) one or more of the
applicable conditions precedent set forth in Section 3 will not be satisfied on
the requested Funding Date for the applicable Borrowing, or (ii) the requested
Borrowing would exceed the Availability on such Funding Date. Swing Lender shall
not otherwise be required to determine whether the applicable conditions
precedent set forth in Section 3 have been satisfied on the Funding Date
applicable thereto prior to making any Swing Loan. The Swing Loans shall be
secured by Agent's Liens, constitute Advances and Obligations hereunder, and
bear interest at the rate applicable from time to time to Advances that are Base
Rate Loans.

(c)Making of Loans.

(i)In the event that Swing Lender is not obligated to make a Swing Loan, then
promptly after receipt of a request for a Borrowing pursuant to Section 2.3(a),
Agent shall notify the Lenders, not later than 1:00 p.m. (California time) on
the Business Day immediately preceding the Funding Date applicable thereto, by
telecopy, telephone, or other similar form of transmission, of the requested
Borrowing. Each Lender shall make the amount of such Lender's Pro Rata Share of
the requested Borrowing available to Agent in immediately available funds, to
Agent's Account, not later than 10:00 a.m. (California time) on the Funding Date
applicable thereto. After Agent's receipt of the proceeds of such Advances,
Agent shall make the proceeds thereof available to Borrower on the applicable
Funding Date by transferring immediately available funds equal to such proceeds
received by Agent to the Designated Account; provided, however, that, subject to
the provisions of Section 2.3(d)(ii), Agent shall not request any Lender to make
any Advance if it has knowledge that, and no Lender shall have the obligation to
make any Advance, if (1) one or more of the applicable conditions precedent set
forth in Section 3 will not be satisfied on the requested Funding Date for the
applicable Borrowing unless such condition has been waived, or (2) the requested
Borrowing would exceed the Availability on such Funding Date.

(ii)Unless Agent receives notice from a Lender prior to 9:00 a.m. (California
time) on the date of a Borrowing, that such Lender will not make available as
and when required hereunder to Agent for the account of Borrower the amount of
that Lender's Pro Rata Share of the Borrowing, Agent may assume that each Lender
has made or will make such amount available to Agent in immediately available
funds on the Funding Date and Agent may (but shall not be so required), in
reliance upon such assumption, make available to Borrower on such date a
corresponding amount. If any Lender shall not have made its full amount
available to Agent in immediately available funds and if Agent in such
circumstances has made available to Borrower such amount, that Lender shall on
the Business Day following such Funding Date make such amount available to
Agent, together with interest at the Defaulting Lender Rate for each day during
such period. A notice submitted by Agent to any Lender with respect to amounts
owing under this Section 2.3(c)(ii) shall be conclusive, absent manifest error.
If such amount is so made available, such payment to Agent shall constitute such
Lender's Advance on the date of Borrowing for all purposes of this Agreement. If
such amount is not made available to Agent on the Business Day following the
Funding Date, Agent will notify Borrower of such failure to fund and, upon
demand by Agent, Borrower shall pay such amount to Agent for Agent's account,
together with interest thereon for each day elapsed since the date of such
Borrowing, at a rate per annum equal to the interest rate applicable at the time
to the Advances composing such Borrowing.

(d)Protective Advances and Optional Overadvances.

(i)Any contrary provision of this Agreement or any other Loan Document
notwithstanding, Agent hereby is authorized by Borrower and the Lenders, from
time to time in Agent's sole discretion, (A) after the occurrence and during the
continuance of a Default or an Event of Default, or (B) at any time that any of
the other applicable conditions precedent set forth in Section 3 are not
satisfied, to make Advances to, or for the benefit of, Borrower on behalf of the
Lenders (in an aggregate amount for all such Advances taken together not
exceeding $5,000,000 outstanding at any one time) that Agent, in its Permitted

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Discretion deems necessary or desirable (1) to preserve or protect the
Collateral, or any portion thereof, or (2) to enhance the likelihood of
repayment of the Obligations (other than the Bank Product Obligations) (any of
the Advances described in this Section 2.3(d)(i) shall be referred to as
“Protective Advances”).

(ii)Any contrary provision of this Agreement or any other Loan Document
notwithstanding, the Lenders hereby authorize Agent or Swing Lender, as
applicable, and either Agent or Swing Lender, as applicable, may, but is not
obligated to, knowingly and intentionally, continue to make Advances (including
Swing Loans) to Borrower notwithstanding that an Overadvance exists or would be
created thereby, so long as (A) after giving effect to such Advances, the
outstanding Revolver Usage does not exceed the Borrowing Base by more than
$5,000,000, and (B) after giving effect to such Advances, the outstanding
Revolver Usage (except for and excluding amounts charged to the Loan Account for
interest, fees, or Lender Group Expenses) does not exceed the Maximum Revolver
Amount. In the event Agent obtains actual knowledge that the Revolver Usage
exceeds the amounts permitted by the immediately foregoing provisions,
regardless of the amount of, or reason for, such excess, Agent shall notify the
Lenders as soon as practicable (and prior to making any (or any additional)
intentional Overadvances (except for and excluding amounts charged to the Loan
Account for interest, fees, or Lender Group Expenses) unless Agent determines
that prior notice would result in imminent harm to the Collateral or its value,
in which case Agent may make such Overadvances and provide notice as promptly as
practicable thereafter), and the Lenders with Revolver Commitments thereupon
shall, together with Agent, jointly determine the terms of arrangements that
shall be implemented with Borrower intended to reduce, within a reasonable time,
the outstanding principal amount of the Advances to Borrower to an amount
permitted by the preceding sentence. In such circumstances, if any Lender with a
Revolver Commitment objects to the proposed terms of reduction or repayment of
any Overadvance, the terms of reduction or repayment thereof shall be
implemented according to the determination of the Required Lenders. The
foregoing provisions are meant for the benefit of the Lenders and Agent and are
not meant for the benefit of Borrower, which shall continue to be bound by the
provisions of Section 2.5. Each Lender with a Revolver Commitment shall be
obligated to settle with Agent as provided in Section 2.3(e) (or Section 2.3(g),
as applicable) for the amount of such Lender's Pro Rata Share of any
unintentional Overadvances by Agent reported to such Lender, any intentional
Overadvances made as permitted under this Section 2.3(d)(ii), and any
Overadvances resulting from the charging to the Loan Account of interest, fees,
or Lender Group Expenses.

(iii)Each Protective Advance and each Overadvance shall be deemed to be an
Advance hereunder, except that no Protective Advance or Overadvance shall be
eligible to be a LIBOR Rate Loan and, prior to Settlement therefor, all payments
on the Protective Advances shall be payable to Agent solely for its own account.
The Protective Advances and Overadvances shall be repayable on demand, secured
by Agent's Liens, constitute Obligations hereunder, and bear interest at the
rate applicable from time to time to Advances that are Base Rate Loans. The
ability of Agent to make Protective Advances is separate and distinct from its
ability to make Overadvances and its ability to make Overadvances is separate
and distinct from its ability to make Protective Advances. For the avoidance of
doubt, the limitations on Agent's ability to make Protective Advances do not
apply to Overadvances and the limitations on Agent's ability to make
Overadvances do not apply to Protective Advances. The provisions of this Section
2.3(d) are for the exclusive benefit of Agent, Swing Lender, and the Lenders and
are not intended to benefit Borrower in any way.

(e)Settlement. It is agreed that each Lender's funded portion of the Advances is
intended by the Lenders to equal, at all times, such Lender's Pro Rata Share of
the outstanding Advances. Such agreement notwithstanding, Agent, Swing Lender,
and the other Lenders agree (which agreement shall not be for the benefit of
Borrower) that in order to facilitate the administration of this Agreement and
the other Loan Documents, settlement among the Lenders as to the Advances, the
Swing Loans, and the Protective Advances shall take place on a periodic basis in
accordance with the following provisions:

(i)Agent shall request settlement (“Settlement”) with the Lenders on a weekly
basis, or on a more frequent basis if so determined by Agent (1) on behalf of
Swing Lender, with respect to the outstanding Swing Loans, (2) for itself, with
respect to the outstanding Protective Advances or Overadvances, and (3) with
respect to Borrower's or its Subsidiaries' Collections or payments received, as
to each by notifying the Lenders by telecopy, telephone, or other similar form
of transmission, of such requested Settlement, no later than 2:00 p.m.
(California time) on the Business Day immediately prior to the date of such
requested Settlement (the date of such requested Settlement being the
“Settlement Date”). Such notice of a Settlement Date shall include a summary
statement of the amount of outstanding Advances, Swing Loans, Overadvances, and
Protective Advances for the period since the prior Settlement Date. Subject to
the terms and conditions contained herein (including Section 2.3(g)): (y) if the
amount of the Advances (including Swing Loans, Overadvances, and Protective
Advances) made by a Lender that is not a Defaulting Lender exceeds such Lender's
Pro Rata Share of the Advances (including Swing Loans, Overadvances, and
Protective Advances) as of a Settlement Date, then Agent shall, by no later than
12:00 p.m. (California time) on the Settlement Date, transfer in immediately
available funds to a Deposit Account of such Lender (as such Lender may
designate), an amount such that each such Lender shall, upon receipt of such
amount, have as of the Settlement Date, its Pro Rata Share of the Advances
(including Swing Loans, Overadvances, and Protective Advances), and (z) if the
amount of the Advances (including Swing Loans, Overadvances, and Protective
Advances) made by a Lender is less than such Lender's Pro Rata Share of the
Advances (including

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Swing Loans, Overadvances, and Protective Advances) as of a Settlement Date,
such Lender shall no later than 12:00 p.m. (California time) on the Settlement
Date transfer in immediately available funds to Agent's Account, an amount such
that each such Lender shall, upon transfer of such amount, have as of the
Settlement Date, its Pro Rata Share of the Advances (including Swing Loans,
Overadvances, and Protective Advances). Such amounts made available to Agent
under clause (z) of the immediately preceding sentence shall be applied against
the amounts of the applicable Swing Loans, Overadvances, or Protective Advances
and, together with the portion of such Swing Loans, Overadvances, or Protective
Advances representing Swing Lender's Pro Rata Share thereof, shall constitute
Advances of such Lenders. If any such amount is not made available to Agent by
any Lender on the Settlement Date applicable thereto to the extent required by
the terms hereof, Agent shall be entitled to recover for its account such amount
on demand from such Lender together with interest thereon at the Defaulting
Lender Rate.

(ii)In determining whether a Lender's balance of the Advances, Swing Loans,
Overadvances, and Protective Advances is less than, equal to, or greater than
such Lender's Pro Rata Share of the Advances, Swing Loans, Overadvances, and
Protective Advances as of a Settlement Date, Agent shall, as part of the
relevant Settlement, apply to such balance the portion of payments actually
received in good funds by Agent with respect to principal, interest, fees
payable by Borrower and allocable to the Lenders hereunder, and proceeds of
Collateral.

(iii)Between Settlement Dates, Agent, to the extent Protective Advances,
Overadvances, or Swing Loans are outstanding, may pay over to Agent or Swing
Lender, as applicable, any Collections or payments received by Agent, that in
accordance with the terms of this Agreement would be applied to the reduction of
the Advances, for application to the Protective Advances, Overadvances, or Swing
Loans. Between Settlement Dates, Agent, to the extent no Protective Advances,
Overadvances, or Swing Loans are outstanding, may pay over to Swing Lender any
Collections or payments received by Agent, that in accordance with the terms of
this Agreement would be applied to the reduction of the Advances, for
application to Swing Lender's Pro Rata Share of the Advances. If, as of any
Settlement Date, Collections or payments of Borrower or the other Loan Parties
received since the then immediately preceding Settlement Date have been applied
to Swing Lender's Pro Rata Share of the Advances other than to Swing Loans, as
provided for in the previous sentence, Swing Lender shall pay to Agent for the
accounts of the Lenders, and Agent shall pay to the Lenders (other than a
Defaulting Lender if Agent has implemented the provisions of Section 2.3(g)), to
be applied to the outstanding Advances of such Lenders, an amount such that each
such Lender shall, upon receipt of such amount, have, as of such Settlement
Date, its Pro Rata Share of the Advances. During the period between Settlement
Dates, Swing Lender with respect to Swing Loans, Agent with respect to
Protective Advances and Overadvances, and each Lender with respect to the
Advances other than Swing Loans, Overadvances, and Protective Advances, shall be
entitled to interest at the applicable rate or rates payable under this
Agreement on the daily amount of funds employed by Swing Lender, Agent, or the
Lenders, as applicable.

(iv)Anything in this Section 2.3(e) to the contrary notwithstanding, in the
event that a Lender is a Defaulting Lender, Agent shall be entitled to refrain
from remitting settlement amounts to the Defaulting Lender and, instead, shall
be entitled to elect to implement the provisions set forth in Section 2.3(g).

(f)Notation. Agent, as a non-fiduciary agent for Borrower, shall maintain a
register showing the principal amount of the Advances, owing to each Lender,
including the Swing Loans owing to Swing Lender, and Protective Advances and
Overadvances owing to Agent, and the interests therein of each Lender, from time
to time and such register shall, absent manifest error, conclusively be presumed
to be correct and accurate.

(g)Defaulting Lenders. Agent shall not be obligated to transfer to a Defaulting
Lender any payments made by Borrower to Agent for the Defaulting Lender's
benefit or any Collections or proceeds of Collateral that would otherwise be
remitted hereunder to the Defaulting Lender, and, in the absence of such
transfer to the Defaulting Lender, Agent shall transfer any such payments (A)
first, to Swing Lender to the extent of any Swing Loans that were made by Swing
Lender and that were required to be, but were not, paid by the Defaulting
Lender, (B) second, to the Issuing Lender, to the extent of the portion of a
Letter of Credit Disbursement that was required to be, but was not, paid by the
Defaulting Lender, (C) third, to each non-Defaulting Lender ratably in
accordance with their Commitments (but, in each case, only to the extent that
such Defaulting Lender's portion of an Advance (or other funding obligation) was
funded by such other non-Defaulting Lender), (D) to a suspense account
maintained by Agent, the proceeds of which shall be retained by Agent and may be
made available to be re-advanced to or for the benefit of Borrower as if such
Defaulting Lender had made its portion of Advances (or other funding
obligations) hereunder, and (E) from and after the date on which all other
Obligations have been paid in full, to such Defaulting Lender in accordance with
tier (L) of Section 2.4(b)(ii). Subject to the foregoing, Agent may hold and, in
its discretion, re-lend to Borrower for the account of such Defaulting Lender
the amount of all such payments received and retained by Agent for the account
of such Defaulting Lender. Solely for the purposes of voting or consenting to
matters with respect to the Loan Documents (including the calculation of Pro
Rata Share in connection therewith) and for the purpose of calculating the fee
payable under Section 2.10(b), such Defaulting Lender shall be deemed not to be
a “Lender” and such Lender's Commitment shall be deemed to be zero. The
provisions of this Section 2.3(g) shall remain effective with respect to such
Defaulting Lender until the earlier of (y) the date on which all of the

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non-Defaulting Lenders, Agent, Issuing Lender, and Borrower shall have waived,
in writing, the application of this Section 2.3(g) to such Defaulting Lender, or
(z) the date on which such Defaulting Lender makes payment of all amounts that
it was obligated to fund hereunder, pays to Agent all amounts owing by
Defaulting Lender in respect of the amounts that it was obligated to fund
hereunder, and, if requested by Agent, provides adequate assurance of its
ability to perform its future obligations hereunder. The operation of this
Section 2.3(g) shall not be construed to increase or otherwise affect the
Commitment of any Lender, to relieve or excuse the performance by such
Defaulting Lender or any other Lender of its duties and obligations hereunder,
or to relieve or excuse the performance by Borrower of its duties and
obligations hereunder to Agent, Issuing Lender, or to the Lenders other than
such Defaulting Lender. Any failure by a Defaulting Lender to fund amounts that
it was obligated to fund hereunder shall constitute a material breach by such
Defaulting Lender of this Agreement and shall entitle Borrower, at its option,
upon written notice to Agent, to arrange for a substitute Lender to assume the
Commitment of such Defaulting Lender, such substitute Lender to be reasonably
acceptable to Agent. In connection with the arrangement of such a substitute
Lender, the Defaulting Lender shall have no right to refuse to be replaced
hereunder, and agrees to execute and deliver a completed form of Assignment and
Acceptance in favor of the substitute Lender (and agrees that it shall be deemed
to have executed and delivered such document if it fails to do so) subject only
to being paid its share of the outstanding Obligations (other than Bank Product
Obligations, but including (1) all interest, fees, and other amounts that may be
due and payable in respect thereof, and (2) an assumption of its Pro Rata Share
of its participation in the Letters of Credit); provided, however, that any such
assumption of the Commitment of such Defaulting Lender shall not be deemed to
constitute a waiver of any of the Lender Groups' or Borrower's rights or
remedies against any such Defaulting Lender arising out of or in relation to
such failure to fund. In the event of a direct conflict between the priority
provisions of this Section 2.3(g) and any other provision contained in this
Agreement or any other Loan Document, it is the intention of the parties hereto
that such provisions be read together and construed, to the fullest extent
possible, to be in concert with each other. In the event of any actual,
irreconcilable conflict that cannot be resolved as aforesaid, the terms and
provisions of this Section 2.3(g) shall control and govern.

(h)Independent Obligations. All Advances (other than Swing Loans, Overadvances,
and Protective Advances) shall be made by the Lenders contemporaneously and in
accordance with their Pro Rata Shares. It is understood that (i) no Lender shall
be responsible for any failure by any other Lender to perform its obligation to
make any Advance (or other extension of credit) hereunder, nor shall any
Commitment of any Lender be increased or decreased as a result of any failure by
any other Lender to perform its obligations hereunder, and (ii) no failure by
any Lender to perform its obligations hereunder shall excuse any other Lender
from its obligations hereunder.

2.4Payments; Reductions of Commitments; Prepayments.

(a)Payments by Borrower.

(i)Except as otherwise expressly provided herein, all payments by Borrower shall
be made to Agent's Account for the account of the Lender Group and shall be made
in immediately available funds, no later than 11:00 a.m. (California time) on
the date specified herein. Any payment received by Agent later than 11:00 a.m.
(California time) shall be deemed to have been received on the following
Business Day and any applicable interest or fee shall continue to accrue until
such following Business Day.

(ii)Unless Agent receives notice from Borrower prior to the date on which any
payment is due to the Lenders that Borrower will not make such payment in full
as and when required, Agent may assume that Borrower has made (or will make)
such payment in full to Agent on such date in immediately available funds and
Agent may (but shall not be so required), in reliance upon such assumption,
distribute to each Lender on such due date an amount equal to the amount then
due such Lender. If and to the extent Borrower does not make such payment in
full to Agent on the date when due, each Lender severally shall repay to Agent
on demand such amount distributed to such Lender, together with interest thereon
at the Defaulting Lender Rate for each day from the date such amount is
distributed to such Lender until the date repaid.

(b)Apportionment and Application.

(i)So long as no Application Event has occurred and is continuing and except as
otherwise provided herein with respect to Defaulting Lenders, all principal and
interest payments received by Agent shall be apportioned ratably among the
Lenders (according to the unpaid principal balance of the Obligations to which
such payments relate held by each Lender) and all payments of fees and expenses
received by Agent (other than fees or expenses that are for Agent's separate
account or for the separate account of the Issuing Lender) shall be apportioned
ratably among the Lenders having a Pro Rata Share of the type of Commitment or
Obligation to which a particular fee or expense relates. All payments to be made
hereunder by Borrower shall be remitted to Agent and all (subject to Section
2.4(b)(iv), Section 2.4(d), and Section 2.4(e)) such payments, and all proceeds
of Collateral received by Agent, shall be applied, so long as no Application
Event has occurred and is continuing, to reduce the balance of the Advances
outstanding and, thereafter, to Borrower (to be wired to the Designated Account)
or such other

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Person entitled thereto under applicable law.

(ii)At any time that an Application Event has occurred and is continuing and
except as otherwise provided herein with respect to Defaulting Lenders, all
payments remitted to Agent and all proceeds of Collateral received by Agent
shall be applied as follows:

1.first, to pay any Lender Group Expenses (including cost or expense
reimbursements) or indemnities then due to Agent under the Loan Documents, until
paid in full,

2.second, to pay any fees or premiums then due to Agent under the Loan Documents
until paid in full,

3.third, to pay interest due in respect of all Protective Advances until paid in
full,

4.fourth, to pay the principal of all Protective Advances until paid in full,

5.fifth, ratably, to pay any Lender Group Expenses (including cost or expense
reimbursements) or indemnities then due to any of the Lenders under the Loan
Documents, until paid in full,

6.sixth, ratably, to pay any fees or premiums then due to any of the Lenders
under the Loan Documents until paid in full,

7.seventh, to pay interest accrued in respect of the Swing Loans until paid in
full,

8.eighth, to pay the principal of all Swing Loans until paid in full,

9.ninth, ratably, to pay interest accrued in respect of the Advances (other than
Protective Advances) until paid in full,

10.tenth, ratably (i) to pay the principal of all Advances until paid in full,
(ii) to Agent, to be held by Agent, for the benefit of Issuing Lender (and for
the ratable benefit of each of the Lenders that have an obligation to pay to
Agent, for the account of the Issuing Lender, a share of each Letter of Credit
Disbursement), as cash collateral in an amount up to 105% of the Letter of
Credit Usage (to the extent permitted by applicable law, such cash collateral
shall be applied to the reimbursement of any Letter of Credit Disbursement as
and when such disbursement occurs and, if a Letter of Credit expires undrawn,
the cash collateral held by Agent in respect of such Letter of Credit shall, to
the extent permitted by applicable law, be reapplied pursuant to this Section
2.4(b)(ii), beginning with tier (A) hereof), and (iii) ratably, to the Bank
Product Providers based upon amounts then certified by the applicable Bank
Product Provider to Agent (in form and substance satisfactory to Agent) to be
due and payable to such Bank Product Providers on account of Bank Product
Obligations,

11.eleventh, to pay any other Obligations other than Obligations owed to
Defaulting Lenders,
12.twelfth, ratably to pay any Obligations owed to Defaulting Lenders; and

13.thirteenth, to Borrower (to be wired to the Designated Account) or such other
Person entitled thereto under applicable law.

(iii)Agent promptly shall distribute to each Lender, pursuant to the applicable
wire instructions received from each Lender in writing, such funds as it may be
entitled to receive, subject to a Settlement delay as provided in Section
2.3(e).

(iv)In each instance, so long as no Application Event has occurred and is
continuing, Section 2.4(b)(i) shall not apply to any payment made by Borrower to
Agent and specified by Borrower to be for the payment of specific Obligations
then due and payable (or prepayable) under any provision of this Agreement or
any other Loan Document.

(v)For purposes of Section 2.4(b)(ii), “paid in full” of a type of Obligation
means payment in cash or immediately available funds of all amounts owing on
account of such type of Obligation, including interest accrued after the
commencement of any Insolvency Proceeding, default interest, interest on
interest, and expense reimbursements, irrespective of whether any of the
foregoing would be or is allowed or disallowed in whole or in part in any
Insolvency Proceeding.

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(vi)In the event of a direct conflict between the priority provisions of this
Section 2.4 and any other provision contained in this Agreement or any other
Loan Document, it is the intention of the parties hereto that such provisions be
read together and construed, to the fullest extent possible, to be in concert
with each other. In the event of any actual, irreconcilable conflict that cannot
be resolved as aforesaid, if the conflict relates to the provisions of Section
2.3(g) and this Section 2.4, then the provisions of Section 2.3(g) shall control
and govern, and if otherwise, then the terms and provisions of this Section 2.4
shall control and govern.

(c)Reduction of Commitments. The Revolver Commitments shall terminate on the
Maturity Date. Borrower may reduce the Revolver Commitments to an amount not
less than the greater of (x) the sum of (A) the Revolver Usage as of such date,
plus (B) the principal amount of all Advances not yet made as to which a request
has been given by Borrower under Section 2.3(a), plus (C) the amount of all
Letters of Credit not yet issued as to which a request has been given by
Borrower pursuant to Section 2.11(a) and (y) $25,000,000. Each such reduction
shall be in an amount which is not less than $5,000,000 (unless the Revolver
Commitments are being reduced to $25,000,000 and the amount of the Revolver
Commitments in effect immediately prior to such reduction are less than
$30,000,000), shall be made by providing not less than 10 Business Days prior
written notice to Agent, and shall be irrevocable. Once reduced, the Revolver
Commitments may not be increased. Each such reduction of the Revolver
Commitments shall reduce the Revolver Commitments of each Lender proportionately
in accordance with its ratable share thereof.

(d)Optional Prepayments. Borrower may prepay the principal of any Advance at any
time in whole or in part.

(e)Mandatory Prepayment. If, at any time, the Revolver Usage on such date
exceeds (A) the Borrowing Base (such excess being referred to as the “Borrowing
Base Excess”) or (B) the Maximum Revolver Amount (such excess being referred to
as the “Maximum Revolver Amount Excess”), then Borrower shall immediately prepay
the Obligations in accordance with Section 2.4(f) in an aggregate amount equal
to the Borrowing Base Excess or Maximum Revolver Amount Excess, as applicable.

(f)Application of Payments. Each prepayment pursuant to Section 2.4(e) shall,
(A) so long as no Application Event shall have occurred and be continuing, be
applied, first, to the outstanding principal amount of the Advances until paid
in full, and second, to cash collateralize the Letters of Credit in an amount
equal to 105% of the then extant Letter of Credit Usage, and (B) if an
Application Event shall have occurred and be continuing, be applied in the
manner set forth in Section 2.4(b)(ii).

2.5Overadvances. If, at any time or for any reason, the amount of Obligations
owed by Borrower to the Lender Group pursuant to Section 2.1 or Section 2.11 is
greater than any of the limitations set forth in Section 2.1 or Section 2.11, as
applicable (an “Overadvance”), Borrower shall immediately pay to Agent, in cash,
the amount of such excess, which amount shall be used by Agent to reduce the
Obligations in accordance with the priorities set forth in Section 2.4(b).
Borrower promises to pay the Obligations (including principal, interest, fees,
costs, and expenses) in full on the Maturity Date or, if earlier, on the date on
which the Obligations (other than the Bank Product Obligations) become due and
payable pursuant to the terms of this Agreement.

2.6Interest Rates and Letter of Credit Fee: Rates, Payments, and Calculations.

(a)Interest Rates. Except as provided in Section 2.6(c), all Obligations (except
for undrawn Letters of Credit) that have been charged to the Loan Account
pursuant to the terms hereof shall bear interest on the Daily Balance thereof as
follows:

(i)if the relevant Obligation is a LIBOR Rate Loan, at a per annum rate equal to
the LIBOR Rate plus the LIBOR Rate Margin, and

(ii)otherwise, at a per annum rate equal to the Base Rate plus the Base Rate
Margin.

(b)Letter of Credit Fee. Borrower shall pay Agent (for the ratable benefit of
the Lenders with a Revolver Commitment), a Letter of Credit fee (in addition to
the charges, commissions, fees, and costs set forth in Section 2.11(f)) which
shall accrue at a per annum rate equal to the LIBOR Rate Margin times the Daily
Balance of the undrawn amount of all outstanding Letters of Credit.

(c)Default Rate. Upon the occurrence and during the continuation of an Event of
Default and at the election of the Required Lenders,

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(i)all Obligations (except for undrawn Letters of Credit) that have been charged
to the Loan Account pursuant to the terms hereof shall bear interest on the
Daily Balance thereof at a per annum rate equal to 2 percentage points above the
per annum rate otherwise applicable thereunder, and

(ii)the Letter of Credit fee provided for in Section 2.6(b) shall be increased
to 2 percentage points above the per annum rate otherwise applicable hereunder.

(d)Payment. Except to the extent provided to the contrary in Section 2.10 or
Section 2.12(a), all interest, all Letter of Credit fees, all other fees payable
hereunder or under any of the other Loan Documents, all costs and expenses
payable hereunder or under any of the other Loan Documents, and all Lender Group
Expenses shall be due and payable, in arrears, on the first day of each month at
any time that Obligations or Commitments are outstanding; provided, however,
such costs and expenses shall be payable, in arrears, within 5 Business Days
after Borrower receives an invoice for such costs and expenses if Revolver Usage
is $0 and no Event of Default shall have occurred and be continuing on the day
such costs and expenses would have been due but for this proviso. Borrower
hereby authorizes Agent, from time to time without prior notice to Borrower, to
charge all interest, Letter of Credit fees, and all other fees payable hereunder
or under any of the other Loan Documents (in each case, as and when due and
payable), all costs and expenses payable hereunder or under any of the other
Loan Documents (in each case, as and when accrued or incurred), and all Lender
Group Expenses (as and when accrued or incurred), all charges, commissions,
fees, and costs provided for in Section 2.11(f) (as and when accrued or
incurred), all fees and costs provided for in Section 2.10 (as and when accrued
or incurred), and all other payment obligations as and when due and payable
under any Loan Document or any Bank Product Agreement (including any amounts due
and payable to the Bank Product Providers in respect of Bank Products) to the
Loan Account, which amounts thereafter shall constitute Advances hereunder and,
initially, shall accrue interest at the rate then applicable to Advances that
are Base Rate Loans. Any interest, fees, costs, expenses, Lender Group Expenses,
or other amounts payable hereunder or under any other Loan Document or under any
Bank Product Agreement that are charged to the Loan Account shall thereupon
constitute Advances hereunder and shall initially accrue interest at the rate
then applicable to Advances that are Base Rate Loans (unless and until converted
into LIBOR Rate Loans in accordance with the terms of this Agreement).
Notwithstanding the foregoing, so long as Revolver Usage is $0 and no Event of
Default has occurred and is continuing, no costs and expenses shall be charged
against the Loan Account or constitute Advances without Borrower's consent
unless such costs and expenses remain unpaid 5 Business Days after Borrower
receives an invoice for such costs and expenses.

(e)Computation. All interest and fees chargeable under the Loan Documents shall
be computed on the basis of a 360 day year, in each case, for the actual number
of days elapsed in the period during which the interest or fees accrue. In the
event the Base Rate is changed from time to time hereafter, the rates of
interest hereunder based upon the Base Rate automatically and immediately shall
be increased or decreased by an amount equal to such change in the Base Rate.

(f)Intent to Limit Charges to Maximum Lawful Rate. In no event shall the
interest rate or rates payable under this Agreement, plus any other amounts paid
in connection herewith, exceed the highest rate permissible under any law that a
court of competent jurisdiction shall, in a final determination, deem
applicable. Borrower and the Lender Group, in executing and delivering this
Agreement, intend legally to agree upon the rate or rates of interest and manner
of payment stated within it; provided, however, that, anything contained herein
to the contrary notwithstanding, if such rate or rates of interest or manner of
payment exceeds the maximum allowable under applicable law, then, ipso facto, as
of the date of this Agreement, Borrower is and shall be liable only for the
payment of such maximum amount as is allowed by law, and payment received from
Borrower in excess of such legal maximum, whenever received, shall be applied to
reduce the principal balance of the Obligations to the extent of such excess.

2.7Crediting Payments. The receipt of any payment item by Agent shall not be
considered a payment on account unless such payment item is a wire transfer of
immediately available federal funds made to Agent's Account or unless and until
such payment item is honored when presented for payment. Should any payment item
not be honored when presented for payment, then Borrower shall be deemed not to
have made such payment and interest shall be calculated accordingly. Anything to
the contrary contained herein notwithstanding, any payment item shall be deemed
received by Agent only if it is received into Agent's Account on a Business Day
on or before 11:00 a.m. (California time). If any payment item is received into
Agent's Account on a non-Business Day or after 11:00 a.m. (California time) on a
Business Day, it shall be deemed to have been received by Agent as of the
opening of business on the immediately following Business Day.

2.8Designated Account. Agent is authorized to make the Advances, and Issuing
Lender is authorized to issue the Letters of Credit, under this Agreement based
upon telephonic or other instructions received from anyone purporting to be an
Authorized Person or, without instructions, if pursuant to Section 2.6(d).
Borrower agrees to establish and maintain the Designated Account with the
Designated Account Bank for the purpose of receiving the proceeds of the
Advances requested by Borrower and made by Agent or the Lenders hereunder.
Unless otherwise agreed by Agent and Borrower, any Advance or Swing Loan
requested by Borrower and made by Agent or the Lenders hereunder shall be made
to the Designated Account.

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2.9Maintenance of Loan Account; Statements of Obligations. Agent shall maintain
an account on its books in the name of Borrower (the “Loan Account”) on which
Borrower will be charged with all Advances (including Protective Advances and
Swing Loans) made by Agent, Swing Lender, or the Lenders to Borrower or for
Borrower's account, the Letters of Credit issued or arranged by Issuing Lender
for Borrower's account, and with all other payment Obligations hereunder or
under the other Loan Documents, including, accrued interest, fees and expenses,
and Lender Group Expenses. In accordance with Section 2.7, the Loan Account will
be credited with all payments received by Agent from Borrower or for Borrower's
account. Agent shall render monthly statements regarding the Loan Account to
Borrower, including principal, interest, fees, and including an itemization of
all charges and expenses constituting Lender Group Expenses owing, and such
statements, absent manifest error, shall be conclusively presumed to be correct
and accurate and constitute an account stated between Borrower and the Lender
Group unless, within 30 days after receipt thereof by Borrower, Borrower shall
deliver to Agent written objection thereto describing the error or errors
contained in any such statements.

2.10Fees. Borrower shall pay to Agent,

(a)for the account of Agent, as and when due and payable under the terms of the
Fee Letter, the fees set forth in the Fee Letter.

(b)for the ratable account of those Lenders with Revolver Commitments, on the
first day of each month from and after the Closing Date up to the first day of
the month prior to the Payoff Date and on the Payoff Date, an unused line fee in
an amount equal to (i) if the average Daily Balance of the Revolver Usage during
the immediately preceding month (or portion thereof in the case of the month in
which the Closing Date occurs) is less than 50% of the Maximum Revolver Amount,
0.50% per annum times the result of (x) the aggregate amount of the Revolver
Commitments, less (y) the average Daily Balance of the Revolver Usage during the
immediately preceding month (or portion thereof), and (ii) if the average Daily
Balance of the Revolver Usage during the immediately preceding month (or portion
thereof in the case of the month in which the Closing Date occurs) is greater
than or equal to 50% of the Maximum Revolver Amount, 0.375% per annum times the
result of (x) the aggregate amount of the Revolver Commitments, less (y) the
average Daily Balance of the Revolver Usage during the immediately preceding
month (or portion thereof).

(c)for the account of Agent, audit, appraisal, and valuation fees and charges,
as and when incurred or chargeable, as follows (i) a fee of $1,000 per day, per
auditor, plus out-of-pocket expenses for each audit of Borrower performed by
personnel employed by Agent, (ii) if implemented, a fee of $1,000 per day, per
applicable individual, plus out of pocket expenses for the establishment of
electronic collateral reporting systems, and (iii) the actual charges paid or
incurred by Agent if it elects to employ the services of one or more third
Persons to perform audits of Borrower or its Subsidiaries, to establish
electronic collateral reporting systems, to appraise the Collateral, or any
portion thereof, or to assess Borrower's or its Subsidiaries' business
valuation; provided, however, that so long as no Event of Default shall have
occurred and be continuing and Excess Availability has not at any time been less
than 12.5% of the Maximum Revolver Amount, Borrower shall not be obligated to
reimburse Agent for more than 2 audits during any calendar year; provided,
further, however, that so long as no Event of Default shall have occurred and be
continuing, Borrower shall not be obligated to reimburse Agent for more than 2
appraisals of Inventory during any calendar year, or more than 1 appraisal of
Intellectual Property during any calendar year.

(d)if Borrower has sent a notice of termination pursuant to the provisions of
Section 3.5, then on the date set forth as the date of termination of this
Agreement in such notice, for the ratable account of those Lenders with Revolver
Commitments, the Applicable Prepayment Premium. In the event of a Prepayment for
any other reason, including (i) acceleration of the Obligations as a result of
the occurrence of an Event of Default, (ii) foreclosure and sale of, or
collection of, the Collateral, (iii) sale of the Collateral in any Insolvency
Proceeding, or (iv) the restructure, reorganization, or compromise of the
Obligations by the confirmation of a plan of reorganization or any other plan of
compromise, restructure, or arrangement in any Insolvency Proceeding, then, in
view of the impracticability and extreme difficulty of ascertaining the actual
amount of damages to the Lender Group or profits lost by the Lender Group as a
result of such Prepayment, and by mutual agreement of the parties as to a
reasonable estimation and calculation of the lost profits or damages of the
Lender Group, Borrower shall pay to Agent, in cash, the Applicable Prepayment
Premium, measured as of the date of such Prepayment. For purposes of this
section, “Applicable Prepayment Premium” means, as of any date of determination,
an amount equal to (A) during the period from and after the Closing Date up to
(but not including) the date that is the first anniversary of the Closing Date
(the “First Period”), 0.50% times the Maximum Revolver Amount on the date
immediately prior to the date of determination, and (B) $0 thereafter, and
“Prepayment” means the obligation of Borrower to make payment in full of the
Obligations at any time prior to the Maturity Date.

2.11Letters of Credit.

(a)Subject to the terms and conditions of this Agreement, upon the request of
Borrower made in accordance

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herewith, the Issuing Lender agrees to issue, or to cause an Underlying Issuer
(including, as Issuing Lender's agent) to issue, a requested Letter of Credit.
If Issuing Lender, at its option, elects to cause an Underlying Issuer to issue
a requested Letter of Credit, then Issuing Lender agrees that it will enter into
arrangements relative to the reimbursement of such Underlying Issuer (which may
include, among, other means, by becoming an applicant with respect to such
Letter of Credit or entering into undertakings which provide for reimbursements
of such Underlying Issuer with respect to such Letter of Credit; each such
obligation or undertaking, irrespective of whether in writing, a “Reimbursement
Undertaking”) with respect to Letters of Credit issued by such Underlying
Issuer. By submitting a request to Issuing Lender for the issuance of a Letter
of Credit, Borrower shall be deemed to have requested that Issuing Lender issue
or that an Underlying Issuer issue the requested Letter of Credit and to have
requested Issuing Lender to issue a Reimbursement Undertaking with respect to
such requested Letter of Credit if it is to be issued by an Underlying Issuer
(it being expressly acknowledged and agreed by Borrower that Borrower is and
shall be deemed to be an applicant (within the meaning of Section 5-102(a)(2) of
the Code) with respect to each Underlying Letter of Credit). Each request for
the issuance of a Letter of Credit, or the amendment, renewal, or extension of
any outstanding Letter of Credit, shall be made in writing by an Authorized
Person and delivered to the Issuing Lender via hand delivery, telefacsimile, or
other electronic method of transmission reasonably in advance of the requested
date of issuance, amendment, renewal, or extension. Each such request shall be
in form and substance reasonably satisfactory to the Issuing Lender and shall
specify (i) the amount of such Letter of Credit, (ii) the date of issuance,
amendment, renewal, or extension of such Letter of Credit, (iii) the proposed
expiration date of such Letter of Credit, (iv) the name and address of the
beneficiary of the Letter of Credit, and (v) such other information (including,
the conditions of drawing, and, in the case of an amendment, renewal, or
extension, identification of the Letter of Credit to be so amended, renewed, or
extended) as shall be necessary to prepare, amend, renew, or extend such Letter
of Credit. Anything contained herein to the contrary notwithstanding, the
Issuing Lender may, but shall not be obligated to, issue or cause the issuance
of a Letter of Credit or to issue a Reimbursement Undertaking in respect of an
Underlying Letter of Credit, in either case, that supports the obligations of
Borrower or its Subsidiaries (1) in respect of (A) a lease of real property, or
(B) an employment contract, or (2) at any time that one or more of the Lenders
is a Defaulting Lender. The Issuing Lender shall have no obligation to issue a
Letter of Credit or a Reimbursement Undertaking in respect of an Underlying
Letter of Credit, in either case, if any of the following would result after
giving effect to the requested issuance:

(i)the Letter of Credit Usage would exceed the Borrowing Base less the
outstanding amount of Advances (inclusive of Swing Loans) at such time, or

(ii)the Letter of Credit Usage would exceed $10,000,000, or

(iii)the Letter of Credit Usage would exceed the Maximum Revolver Amount less
the outstanding amount of Advances (including Swing Loans).

Each Letter of Credit shall be in form and substance reasonably acceptable to
the Issuing Lender, including the requirement that the amounts payable
thereunder must be payable in Dollars. If Issuing Lender makes a payment under a
Letter of Credit or an Underlying Issuer makes a payment under an Underlying
Letter of Credit, Borrower shall pay to Agent an amount equal to the applicable
Letter of Credit Disbursement on the date such Letter of Credit Disbursement is
made and, in the absence of such payment, the amount of the Letter of Credit
Disbursement immediately and automatically shall be deemed to be an Advance
hereunder and, initially, shall bear interest at the rate then applicable to
Advances that are Base Rate Loans. If a Letter of Credit Disbursement is deemed
to be an Advance hereunder (notwithstanding any failure to satisfy any condition
precedent set forth in Section 3), Borrower's obligation to pay the amount of
such Letter of Credit Disbursement to Issuing Lender shall be automatically
converted into an obligation to pay the resulting Advance. Promptly following
receipt by Agent of any payment from Borrower pursuant to this paragraph, Agent
shall distribute such payment to the Issuing Lender or, to the extent that
Lenders have made payments pursuant to Section 2.11(b) to reimburse the Issuing
Lender, then to such Lenders and the Issuing Lender as their interests may
appear.
(b)Promptly following receipt of a notice of a Letter of Credit Disbursement
pursuant to Section 2.11(a), each Lender with a Revolver Commitment agrees to
fund its Pro Rata Share of any Advance deemed made pursuant to Section 2.11(a)
on the same terms and conditions as if Borrower had requested the amount thereof
as an Advance and Agent shall promptly pay to Issuing Lender the amounts so
received by it from the Lenders. By the issuance of a Letter of Credit or a
Reimbursement Undertaking (or an amendment, renewal, or extension of a Letter of
Credit or a Reimbursement Undertaking) and without any further action on the
part of the Issuing Lender or the Lenders with Revolver Commitments, the Issuing
Lender shall be deemed to have granted to each Lender with a Revolver
Commitment, and each Lender with a Revolver Commitment shall be deemed to have
purchased, a participation in each Letter of Credit issued by Issuing Lender and
each Reimbursement Undertaking, in an amount equal to its Pro Rata Share of such
Letter of Credit or Reimbursement Undertaking, and each such Lender agrees to
pay to Agent, for the account of the Issuing Lender, such Lender's Pro Rata
Share of any Letter of Credit Disbursement made by Issuing Lender or an
Underlying Issuer under the applicable Letter of Credit. In consideration and in
furtherance of the foregoing, each Lender with a Revolver Commitment hereby
absolutely and unconditionally agrees to pay to Agent, for the account of the
Issuing

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Lender, such Lender's Pro Rata Share of each Letter of Credit Disbursement made
by Issuing Lender or an Underlying Issuer and not reimbursed by Borrower on the
date due as provided in Section 2.11(a), or of any reimbursement payment
required to be refunded (or that Agent or Issuing Lender elects, based upon the
advice of counsel, to refund) to Borrower for any reason. Each Lender with a
Revolver Commitment acknowledges and agrees that its obligation to deliver to
Agent, for the account of the Issuing Lender, an amount equal to its respective
Pro Rata Share of each Letter of Credit Disbursement pursuant to this Section
2.11(b) shall be absolute and unconditional and such remittance shall be made
notwithstanding the occurrence or continuation of an Event of Default or Default
or the failure to satisfy any condition set forth in Section 3. If any such
Lender fails to make available to Agent the amount of such Lender's Pro Rata
Share of a Letter of Credit Disbursement as provided in this Section, such
Lender shall be deemed to be a Defaulting Lender and Agent (for the account of
the Issuing Lender) shall be entitled to recover such amount on demand from such
Lender together with interest thereon at the Defaulting Lender Rate until paid
in full.

(c)Borrower hereby agrees to indemnify, save, defend, and hold the Lender Group
and each Underlying Issuer harmless from any damage, loss, cost, expense, or
liability (other than Taxes, which shall be governed by Section 16), and
reasonable attorneys fees incurred by Issuing Lender, any other member of the
Lender Group, or any Underlying Issuer arising out of or in connection with any
Reimbursement Undertaking or any Letter of Credit; provided, however, that
Borrower shall not be obligated hereunder to indemnify for any loss, cost,
expense, or liability that a court of competent jurisdiction finally determines
to have resulted from the gross negligence or willful misconduct of the Issuing
Lender, any other member of the Lender Group, or any Underlying Issuer. Borrower
agrees to be bound by the Underlying Issuer's regulations and interpretations of
any Letter of Credit or by Issuing Lender's interpretations of any Reimbursement
Undertaking even though this interpretation may be different from Borrower's
own, and Borrower understands and agrees that none of the Issuing Lender, any
other member of the Lender Group, or any Underlying Issuer shall be liable for
any error, negligence, or mistake, whether of omission or commission, in
following Borrower's instructions or those contained in the Letter of Credit or
any modifications, amendments, or supplements thereto. Borrower understands that
the Reimbursement Undertakings may require Issuing Lender to indemnify the
Underlying Issuer for certain costs or liabilities arising out of claims by
Borrower against such Underlying Issuer. Borrower hereby agrees to indemnify,
save, defend, and hold Issuing Lender and the other members of the Lender Group
harmless with respect to any loss, cost, expense (including reasonable attorneys
fees), or liability (other than Taxes, which shall be governed by Section 16)
incurred by them as a result of the Issuing Lender's indemnification of an
Underlying Issuer; provided, however, that Borrower shall not be obligated
hereunder to indemnify for any such loss, cost, expense, or liability to the
extent that it is caused by the gross negligence or willful misconduct of the
Issuing Lender or any other member of the Lender Group. Borrower hereby
acknowledges and agrees that none of the Issuing Lender, any other member of the
Lender Group, or any Underlying Issuer shall be responsible for delays, errors,
or omissions resulting from the malfunction of equipment in connection with any
Letter of Credit.

(d)The obligation of Borrower to reimburse the Issuing Lender for each drawing
under each Letter of Credit shall be absolute, unconditional and irrevocable,
and shall be paid strictly in accordance with the terms of this Agreement under
all circumstances, including the following:

(i)any lack of validity or enforceability of such Letter of Credit, this
Agreement, or another Loan Document,

(ii)the existence of any claim, counterclaim, setoff, defense or other right
that Borrower or any of its Subsidiaries may have at any time against any
beneficiary or any transferee of such Letter of Credit (or any Person for whom
any such beneficiary or any such transferee maybe acting), the Issuing Lender or
any other Person, whether in connection with this Agreement, the transactions
contemplated hereby or such Letter of Credit or any agreement or instrument
relating thereto, or any unrelated transaction,

(iii)any draft, demand, certificate or other document presented under such
Letter of Credit proving to be forged, fraudulent, invalid or insufficient in
any respect or any statement therein being untrue or inaccurate in any respect,
or any loss or delay in the transmission or otherwise of any document required
in order to make a drawing under such Letter of Credit,

(iv)any payment by the Issuing Lender under such Letter of Credit against
presentation of a draft or certificate that does not substantially or strictly
comply with the terms of such Letter of Credit (including, without limitation,
any requirement that presentation be made at a particular place or by a
particular time of day), or any payment made by the Issuing Lender under such
Letter of Credit to any Person purporting to be a trustee in bankruptcy,
debtor-in-possession, assignee for the benefit of creditors, liquidator,
receiver or other representative of or successor to any beneficiary or any
transferee of such Letter of Credit,

(v)any other circumstance or happening whatsoever, whether or not similar to any
of the foregoing, including any other circumstance that might otherwise
constitute a defense available to, or discharge of, Borrower or

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any of its Subsidiaries, or

(vi)the fact that any Event of Default shall have occurred and be continuing.

(e)Borrower hereby authorizes and directs any Underlying Issuer to deliver to
the Issuing Lender all instruments, documents, and other writings and property
received by such Underlying Issuer pursuant to such Underlying Letter of Credit
and to accept and rely upon the Issuing Lender's instructions with respect to
all matters arising in connection with such Underlying Letter of Credit and the
related application.

(f)Borrower acknowledges and agrees that any and all issuance charges, usage
charges, commissions, fees, and costs incurred by the Issuing Lender relating to
Underlying Letters of Credit shall be Lender Group Expenses for purposes of this
Agreement and shall be reimbursable immediately by Borrower to Agent for the
account of the Issuing Lender; it being acknowledged and agreed by Borrower
that, as of the Closing Date, the usage charge imposed by the Underlying Issuer
is .825% per annum times the undrawn amount of each Underlying Letter of Credit,
that such usage charge may be changed from time to time, and that the Underlying
Issuer also imposes a schedule of charges for amendments, extensions, drawings,
and renewals.

(g)If by reason of (i) any change after the Closing Date in any applicable law,
treaty, rule, or regulation or any change in the interpretation or application
thereof by any Governmental Authority, or (ii) compliance by the Issuing Lender,
any other member of the Lender Group, or Underlying Issuer with any direction,
request, or requirement (irrespective of whether having the force of law) of any
Governmental Authority or monetary authority including, Regulation D of the
Federal Reserve Board as from time to time in effect (and any successor
thereto):

(i)any reserve, deposit, or similar requirement is or shall be imposed or
modified in respect of any Letter of Credit issued or caused to be issued
hereunder or hereby, or

(ii)there shall be imposed on the Issuing Lender, any other member of the Lender
Group, or Underlying Issuer any other condition regarding any Letter of Credit
or Reimbursement Undertaking,

and the result of the foregoing is to increase, directly or indirectly, the cost
to the Issuing Lender, any other member of the Lender Group, or an Underlying
Issuer of issuing, making, participating in, or maintaining any Reimbursement
Undertaking or Letter of Credit or to reduce the amount receivable in respect
thereof, then, and in any such case, Agent may, at any time within a reasonable
period after the additional cost is incurred or the amount received is reduced,
notify Borrower, and Borrower shall pay within 30 days after demand therefor,
such amounts as Agent may specify to be necessary to compensate the Issuing
Lender, any other member of the Lender Group, or an Underlying Issuer for such
additional cost or reduced receipt, together with interest on such amount from
the date of such demand until payment in full thereof at the rate then
applicable to Base Rate Loans hereunder; provided, however, that Borrower shall
not be required to provide any compensation pursuant to this Section 2.11(g) for
any such amounts incurred more than 180 days prior to the date on which the
demand for payment of such amounts is first made to Borrower; provided further,
however, that if an event or circumstance giving rise to such amounts is
retroactive, then the 180-day period referred to above shall be extended to
include the period of retroactive effect thereof. The determination by Agent of
any amount due pursuant to this Section 2.11(g), as set forth in a certificate
setting forth the calculation thereof in reasonable detail, shall, in the
absence of manifest or demonstrable error, be final and conclusive and binding
on all of the parties hereto.
2.12LIBOR Option.

(a)Interest and Interest Payment Dates. In lieu of having interest charged at
the rate based upon the Base Rate, Borrower shall have the option, subject to
Section 2.12(b) below (the “LIBOR Option”) to have interest on all or a portion
of the Advances be charged (whether at the time when made (unless otherwise
provided herein), upon conversion from a Base Rate Loan to a LIBOR Rate Loan, or
upon continuation of a LIBOR Rate Loan as a LIBOR Rate Loan) at a rate of
interest based upon the LIBOR Rate. Interest on LIBOR Rate Loans shall be
payable on the earliest of (i) the last day of the Interest Period applicable
thereto; (ii) the date on which all or any portion of the Obligations are
accelerated pursuant to the terms hereof, or (iii) the date on which this
Agreement is terminated pursuant to the terms hereof. On the last day of each
applicable Interest Period, unless Borrower properly has exercised the LIBOR
Option with respect thereto, the interest rate applicable to such LIBOR Rate
Loan automatically shall convert to the rate of interest then applicable to Base
Rate Loans of the same type hereunder. At any time that an Event of Default has
occurred and is continuing, at the written election of the Required Lenders,
Borrower no longer shall have the option to request that Advances bear interest
at a rate based upon the LIBOR Rate.

(b)LIBOR Election.

(i)Borrower may, at any time and from time to time, so long as Borrower has not
received a

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notice from Agent, after the occurrence and during the continuance of an Event
of Default, of the election of the Required Lenders to terminate the right of
Borrower to exercise the LIBOR Option during the continuance of such Event of
Default, elect to exercise the LIBOR Option by notifying Agent prior to 11:00
a.m. (California time) at least 3 Business Days prior to the commencement of the
proposed Interest Period (the “LIBOR Deadline”). Notice of Borrower's election
of the LIBOR Option for a permitted portion of the Advances and an Interest
Period pursuant to this Section shall be made by delivery to Agent of a LIBOR
Notice received by Agent before the LIBOR Deadline, or by telephonic notice
received by Agent before the LIBOR Deadline (to be confirmed by delivery to
Agent of a LIBOR Notice received by Agent prior to 5:00 p.m. (California time)
on the same day). Promptly upon its receipt of each such LIBOR Notice, Agent
shall provide a copy thereof to each of the affected Lenders.

(ii)Each LIBOR Notice shall be irrevocable and binding on Borrower. In
connection with each LIBOR Rate Loan, Borrower shall indemnify, defend, and hold
Agent and the Lenders harmless against any loss, cost, or expense actually
incurred by Agent or any Lender as a result of (A) the payment of any principal
of any LIBOR Rate Loan other than on the last day of an Interest Period
applicable thereto (including as a result of an Event of Default), (B) the
conversion of any LIBOR Rate Loan other than on the last day of the Interest
Period applicable thereto, or (C) the failure to borrow, convert, continue or
prepay any LIBOR Rate Loan on the date specified in any LIBOR Notice delivered
pursuant hereto (such losses, costs, or expenses, “Funding Losses”). A
certificate of Agent or a Lender delivered to Borrower setting forth in
reasonable detail any amount or amounts that Agent or such Lender is entitled to
receive pursuant to this Section 2.12 shall be conclusive absent manifest error.
Borrower shall pay such amount to Agent or the Lender, as applicable, within 30
days of the date of its receipt of such certificate. If a payment of a LIBOR
Rate Loan on a day other than the last day of the applicable Interest Period
would result in a Funding Loss, Agent may, in its sole discretion at the request
of Borrower, hold the amount of such payment as cash collateral in support of
the Obligations until the last day of such Interest Period and apply such
amounts to the payment of the applicable LIBOR Rate Loan on such last day, it
being agreed that Agent has no obligation to so defer the application of
payments to any LIBOR Rate Loan and that, in the event that Agent does not defer
such application, Borrower shall be obligated to pay any resulting Funding
Losses.

(iii)Borrower shall have not more than 5 LIBOR Rate Loans in effect at any given
time. Borrower only may exercise the LIBOR Option for proposed LIBOR Rate Loans
of at least $1,000,000.

(c)Conversion. Borrower may convert LIBOR Rate Loans to Base Rate Loans at any
time; provided, however, that in the event that LIBOR Rate Loans are converted
or prepaid on any date that is not the last day of the Interest Period
applicable thereto, including as a result of any automatic prepayment through
the required application by Agent of proceeds of Borrower's and its
Subsidiaries' Collections in accordance with Section 2.4(b) or for any other
reason, including early termination of the term of this Agreement or
acceleration of all or any portion of the Obligations pursuant to the terms
hereof, Borrower shall indemnify, defend, and hold Agent and the Lenders and
their Participants harmless against any and all Funding Losses in accordance
with Section 2.12 (b)(ii).

(d)Special Provisions Applicable to LIBOR Rate.

(i)The LIBOR Rate may be adjusted by Agent with respect to any Lender on a
prospective basis to take into account any additional or increased costs to such
Lender of maintaining or obtaining any eurodollar deposits or increased costs,
in each case, due to changes in applicable law (other than changes in laws
relative to Taxes, which shall be governed by Section 16) occurring subsequent
to the commencement of the then applicable Interest Period, including changes in
tax laws (except changes of general applicability in corporate income tax laws)
and changes in the reserve requirements imposed by the Board of Governors of the
Federal Reserve System (or any successor), which additional or increased costs
would increase the cost of funding or maintaining loans bearing interest at the
LIBOR Rate. In any such event, the affected Lender shall give Borrower and Agent
notice of such a determination and adjustment and Agent promptly shall transmit
the notice to each other Lender and, upon its receipt of the notice from the
affected Lender, Borrower may, by notice to such affected Lender (y) require
such Lender to furnish to Borrower a statement setting forth the basis for
adjusting such LIBOR Rate and the method for determining the amount of such
adjustment, or (z) repay the LIBOR Rate Loans with respect to which such
adjustment is made (together with any amounts due under Section 2.12(b)(ii)).

(ii)In the event that any change in market conditions or any law, regulation,
treaty, or directive, or any change therein or in the interpretation or
application thereof, shall at any time after the date hereof, in the reasonable
opinion of any Lender, make it unlawful or impractical for such Lender to fund
or maintain LIBOR Rate Loans or to continue such funding or maintaining, or to
determine or charge interest rates at the LIBOR Rate, such Lender shall give
notice of such changed circumstances to Agent and Borrower and Agent promptly
shall transmit the notice to each other Lender and (y) in the case of any LIBOR
Rate Loans of such Lender that are outstanding, the date specified in such
Lender's notice shall be deemed to be the last day of the Interest Period of
such LIBOR Rate Loans, and interest upon the LIBOR Rate Loans of such Lender
thereafter shall accrue interest at the rate then applicable to Base Rate Loans,
and (z) Borrower shall not be entitled to elect the LIBOR Option

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until such Lender determines that it would no longer be unlawful or impractical
to do so.

(e)No Requirement of Matched Funding. Anything to the contrary contained herein
notwithstanding, neither Agent, nor any Lender, nor any of their Participants,
is required actually to acquire eurodollar deposits to fund or otherwise match
fund any Obligation as to which interest accrues at the LIBOR Rate.

2.13Capital Requirements.

(a)If, after the date hereof, any Lender determines that (i) the adoption of or
change in any law, rule, regulation or guideline regarding capital or reserve
requirements for banks or bank holding companies, or any change in the
interpretation, implementation, or application thereof by any Governmental
Authority charged with the administration thereof, or (ii) compliance by such
Lender or its parent bank holding company with any guideline, request or
directive of any such entity regarding capital adequacy (whether or not having
the force of law), has the effect of reducing the return on such Lender's or
such holding company's capital as a consequence of such Lender's Commitments
hereunder to a level below that which such Lender or such holding company could
have achieved but for such adoption, change, or compliance (taking into
consideration such Lender's or such holding company's then existing policies
with respect to capital adequacy and assuming the full utilization of such
entity's capital) by any amount deemed by such Lender to be material, then such
Lender may notify Borrower and Agent thereof. Following receipt of such notice,
Borrower agrees to pay such Lender on demand the amount of such reduction of
return of capital as and when such reduction is determined, payable within 30
days after presentation by such Lender of a statement in the amount and setting
forth in reasonable detail such Lender's calculation thereof and the assumptions
upon which such calculation was based (which statement shall be deemed true and
correct absent manifest error). In determining such amount, such Lender may use
any reasonable averaging and attribution methods. Failure or delay on the part
of any Lender to demand compensation pursuant to this Section shall not
constitute a waiver of such Lender's right to demand such compensation; provided
that Borrower shall not be required to compensate a Lender pursuant to this
Section for any reductions in return incurred more than 180 days prior to the
date that such Lender notifies Borrower of such law, rule, regulation or
guideline giving rise to such reductions and of such Lender's intention to claim
compensation therefor; provided further that if such claim arises by reason of
the adoption of or change in any law, rule, regulation or guideline that is
retroactive, then the 180-day period referred to above shall be extended to
include the period of retroactive effect thereof.

(b)If any Lender requests additional or increased costs referred to in Section
2.12(d)(i) or amounts under Section 2.13(a) or sends a notice under Section
2.12(d)(ii) relative to changed circumstances (any such Lender, an “Affected
Lender”), then such Affected Lender shall use reasonable efforts to promptly
designate a different one of its lending offices or to assign its rights and
obligations hereunder to another of its offices or branches, if (i) in the
reasonable judgment of such Affected Lender, such designation or assignment
would eliminate or reduce amounts payable pursuant to Section 2.12(d)(i) or
Section 2.13(a), as applicable, or would eliminate the illegality or
impracticality of funding or maintaining LIBOR Rate Loans and (ii) in the
reasonable judgment of such Affected Lender, such designation or assignment
would not subject it to any material unreimbursed cost or expense and would not
otherwise be materially disadvantageous to it. Borrower agrees to pay all
reasonable out-of-pocket costs and expenses incurred by such Affected Lender in
connection with any such designation or assignment. If, after such reasonable
efforts, such Affected Lender does not so designate a different one of its
lending offices or assign its rights to another of its offices or branches so as
to eliminate Borrower's obligation to pay any future amounts to such Affected
Lender pursuant to Section 2.12(d)(i) or Section 2.13(a), as applicable, or to
enable Borrower to Obtain LIBOR Rate Loans, then Borrower (without prejudice to
any amounts then due to such Affected Lender under Section 2.12(d)(i) or Section
2.13(a), as applicable) may, unless prior to the effective date of any such
assignment the Affected Lender withdraws its request for such additional amounts
under Section 2.12(d)(i) or Section 2.13(a), as applicable, or indicates that it
is no longer unlawful or impractical to fund or maintain LIBOR Rate Loans, may
seek a substitute Lender reasonably acceptable to Agent to purchase the
Obligations owed to such Affected Lender and such Affected Lender's Commitments
hereunder (a “Replacement Lender”), and if such Replacement Lender agrees to
such purchase, such Affected Lender shall assign to the Replacement Lender its
Obligations and Commitments, pursuant to an Assignment and Acceptance Agreement,
and upon such purchase by the Replacement Lender, such Replacement Lender shall
be deemed to be a “Lender” for purposes of this Agreement and such Affected
Lender shall cease to be a “Lender” for purposes of this Agreement.

3.
CONDITIONS; TERM OF AGREEMENT.

3.1Conditions Precedent to the Initial Extension of Credit. The obligation of
each Lender to make its initial extension of credit provided for hereunder is
subject to the fulfillment, to the satisfaction of Agent and each Lender, of
each of the conditions precedent set forth on Schedule 3.1 (the making of such
initial extension of credit by a Lender being conclusively deemed to be its
satisfaction or waiver of the conditions precedent ).
3.2Conditions Precedent to all Extensions of Credit. The obligation of the
Lender Group (or any member thereof)

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to make any Advances hereunder (or to extend any other credit hereunder) at any
time shall be subject to the following conditions precedent:

(a)the representations and warranties of Borrower or its Subsidiaries contained
in this Agreement or in the other Loan Documents shall be true and correct in
all material respects (except that such materiality qualifier shall not be
applicable to any representations and warranties that already are qualified or
modified by materiality in the text thereof) on and as of the date of such
extension of credit, as though made on and as of such date (except to the extent
that such representations and warranties relate solely to an earlier date); and
(b)no Default or Event of Default shall have occurred and be continuing on the
date of such extension of credit, nor shall either result from the making
thereof.

3.3Maturity. This Agreement shall continue in full force and effect for a term
ending on the date (the “Maturity Date”) that is the earlier of (a) September
23, 2015 and (b) if on June 16, 2014 any obligations under the Convertible
Senior Notes remain outstanding, the date that is 60 days prior to the maturity
date of the Convertible Senior Notes. The foregoing notwithstanding, the Lender
Group, upon the election of the Required Lenders, shall have the right to
terminate its obligations under this Agreement immediately and without notice
upon the occurrence and during the continuation of an Event of Default.

3.4Effect of Maturity. On the Maturity Date, all commitments of the Lender Group
to provide additional credit hereunder shall automatically be terminated and all
of the Obligations immediately shall become due and payable without notice or
demand and Borrower shall be required to repay all of the Obligations in full.
No termination of the obligations of the Lender Group (other than payment in
full of the Obligations and termination of the Commitments) shall relieve or
discharge any Loan Party of its duties, obligations, or covenants hereunder or
under any other Loan Document and Agent's Liens in the Collateral shall continue
to secure the Obligations and shall remain in effect until all Obligations have
been paid in full and the Commitments have been terminated. When all of the
Obligations have been paid in full and the Lender Group's obligations to provide
additional credit under the Loan Documents have been terminated irrevocably,
Agent will, at Borrower's sole expense, execute and deliver any termination
statements, lien releases, discharges of security interests, and other similar
discharge or release documents (and, if applicable, in recordable form) as are
reasonably necessary to release, as of record, Agent's Liens and all notices of
security interests and liens previously filed by Agent.

3.5Early Termination by Borrower. Borrower has the option, at any time upon 10
days prior written notice to Agent, to terminate this Agreement and terminate
the Commitments hereunder by repaying to Agent all of the Obligations in full.

3.6Conditions Subsequent. The obligation of the Lender Group (or any member
thereof) to continue to make Advances (or otherwise extend credit hereunder) is
subject to the fulfillment, on or before the date applicable thereto, of the
conditions subsequent set forth on Schedule 3.6 (the failure by Borrower to so
perform or cause to be performed such conditions subsequent as and when required
by the terms thereof, shall constitute an Event of Default).

4.
REPRESENTATIONS AND WARRANTIES.

In order to induce the Lender Group to enter into this Agreement, Borrower makes
the following representations and warranties to the Lender Group which shall be
true, correct, and complete, in all material respects (except that such
materiality qualifier shall not be applicable to any representations and
warranties that already are qualified or modified by materiality in the text
thereof), as of the Closing Date, and shall be true, correct, and complete, in
all material respects (except that such materiality qualifier shall not be
applicable to any representations and warranties that already are qualified or
modified by materiality in the text thereof), as of the date of the making of
each Advance (or other extension of credit) made thereafter, as though made on
and as of the date of such Advance (or other extension of credit) (except to the
extent that such representations and warranties relate solely to an earlier
date) and such representations and warranties shall survive the execution and
delivery of this Agreement:
4.1Due Organization and Qualification; Subsidiaries.

(a)Each Loan Party (i) is duly organized and existing and in good standing under
the laws of the jurisdiction of its organization, (ii) is qualified to do
business in any state where the failure to be so qualified could reasonably be
expected to result in a Material Adverse Change, and (iii) has all requisite
power and authority to own and operate its properties, to carry on its business
as now conducted and as proposed to be conducted, to enter into the Loan
Documents to which it is a party and to carry out the transactions contemplated
thereby.

(b)Set forth on Schedule 4.1(b) is a complete and accurate description of the
authorized capital Stock of Borrower, by class, and, as of the Closing Date, a
description of the number of shares of each such class that are issued and

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outstanding. Other than as described on Schedule 4.1(b), there are no
subscriptions, options, warrants, or calls relating to any shares of Borrower's
capital Stock, including any right of conversion or exchange under any
outstanding security or other instrument. Other than as described on Schedule
4.1(b), Borrower is not subject to any obligation (contingent or otherwise) to
repurchase or otherwise acquire or retire any shares of its capital Stock or any
security convertible into or exchangeable for any of its capital Stock.

(c)Set forth on Schedule 4.1(c) (as such Schedule may be updated from time to
time to reflect changes resulting from transactions permitted under this
Agreement), is a complete and accurate list of the Loan Parties' direct and
indirect Subsidiaries, showing: (i) the number of shares of each class of common
and preferred Stock authorized for each of such Subsidiaries, and (ii) the
number and the percentage of the outstanding shares of each such class owned
directly or indirectly by Borrower. All of the outstanding capital Stock of each
such Subsidiary has been validly issued and is fully paid and non-assessable.

(d)Except as set forth on Schedule 4.1(c), there are no subscriptions, options,
warrants, or calls relating to any shares of Borrower's Subsidiaries' capital
Stock, including any right of conversion or exchange under any outstanding
security or other instrument. Neither Borrower nor any of its Subsidiaries is
subject to any obligation (contingent or otherwise) to repurchase or otherwise
acquire or retire any shares of Borrower's Subsidiaries' capital Stock or any
security convertible into or exchangeable for any such capital Stock.

4.2Due Authorization; No Conflict.
(a)As to each Loan Party, the execution, delivery, and performance by such Loan
Party of the Loan Documents to which it is a party have been duly authorized by
all necessary action on the part of such Loan Party.

(b)As to each Loan Party, the execution, delivery, and performance by such Loan
Party of the Loan Documents to which it is a party do not and will not (i)
violate any material provision of federal, state, or local law or regulation
applicable to any Loan Party or its Subsidiaries, the Governing Documents of any
Loan Party or its Subsidiaries, or any order, judgment, or decree of any court
or other Governmental Authority binding on any Loan Party or its Subsidiaries,
(ii) conflict with, result in a breach of, or constitute (with due notice or
lapse of time or both) a default under any Designated Contract of any Loan Party
except to the extent that any such conflict, breach or default could not
individually or in the aggregate reasonably be expected to have a Material
Adverse Change, (iii) result in or require the creation or imposition of any
Lien of any nature whatsoever upon any assets of any Loan Party, other than
Permitted Liens, or (iv) require any approval of any Loan Party's
interestholders or any approval or consent of any Person under any Designated
Contract of any Loan Party, other than consents or approvals that have been
obtained and that are still in force and effect and except, in the case of
Designated Contracts, for consents or approvals, the failure to obtain could not
individually or in the aggregate reasonably be expected to cause a Material
Adverse Change.

4.3Governmental Consents. The execution, delivery, and performance by each Loan
Party of the Loan Documents to which such Loan Party is a party and the
consummation of the transactions contemplated by the Loan Documents do not and
will not require any registration with, consent, or approval of, or notice to,
or other action with or by, any Governmental Authority, other than
registrations, consents, approvals, notices, or other actions that have been
obtained and that are still in force and effect and except for filings and
recordings with respect to the Collateral to be made, or otherwise delivered to
Agent for filing or recordation, as of the Closing Date.

4.4Binding Obligations; Perfected Liens.

(a)Each Loan Document has been duly executed and delivered by each Loan Party
that is a party thereto and is the legally valid and binding obligation of such
Loan Party, enforceable against such Loan Party in accordance with its
respective terms, except as enforcement may be limited by equitable principles
or by bankruptcy, insolvency, reorganization, moratorium, or similar laws
relating to or limiting creditors' rights generally.

(b)Agent's Liens are validly created, perfected (other than (i) in respect of
motor vehicles that are subject to a certificate of title and as to which Agent
has not caused its Lien to be noted on the applicable certificate of title, and
(ii) any Deposit Accounts and Securities Accounts not subject to a Control
Agreement as permitted by Section 6.11, and subject only to the filing of
financing statements, the recordation of the Copyright Security Agreement, and
the recordation of the Mortgages, in each case, in the appropriate filing
offices), and first priority Liens, subject only to Permitted Liens which are
either permitted purchase money Liens or the interests of lessors under Capital
Leases.

4.5Title to Assets; No Encumbrances. Each of the Loan Parties has in all
material respects (a) good, sufficient and legal title to (in the case of fee
interests in Real Property), (b) valid leasehold interests in (in the case of
leasehold interests in real or personal property), and (c) good and marketable
title to (in the case of all other personal property), all of their respective

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assets reflected in their most recent GAAP financial statements delivered
pursuant to Section 5.1, in each case except for assets disposed of since the
date of such financial statements (i) as set forth on Schedule 4.5, or (ii) to
the extent permitted hereby. All of such assets are free and clear of Liens
except for Permitted Liens.

4.6Jurisdiction of Organization; Location of Chief Executive Office;
Organizational Identification Number; Commercial Tort Claims.

(a)The name of (within the meaning of Section 9-503 of the Code) and
jurisdiction of organization of each Loan Party and each of its Subsidiaries is
set forth on Schedule 4.6(a) (as such Schedule may be updated from time to time
to reflect changes resulting from transactions permitted under this Agreement).

(b)The chief executive office of each Loan Party and each of its Subsidiaries is
located at the address indicated on Schedule 4.6(b) (as such Schedule may be
updated from time to time to reflect changes resulting from transactions
permitted under this Agreement).

(c)Each Loan Party's and each of its Subsidiaries' tax identification numbers
and organizational identification numbers, if any, are identified on Schedule
4.6(c) (as such Schedule may be updated from time to time to reflect changes
resulting from transactions permitted under this Agreement).

(d)As of the Closing Date, no Loan Party and no Subsidiary of a Loan Party holds
any commercial tort claims that exceed $250,000 in amount, except as set forth
on Schedule 4.6(d).

4.7Litigation.

(a)There are no actions, suits, or proceedings pending or, to the knowledge of
Borrower, after due inquiry, threatened in writing against a Loan Party or any
of its Subsidiaries that either individually or in the aggregate could
reasonably be expected to result in a Material Adverse Change.

(b)Schedule 4.7(b) sets forth a complete and accurate description, with respect
to each of the actions, suits, or proceedings with asserted liabilities in
excess of, or that could reasonably be expected to result in liabilities in
excess of, $1,000,000 that, as of the Closing Date, is pending or, to the
knowledge of Borrower, after due inquiry, threatened against a Loan Party or any
of its Subsidiaries, of (i) the parties to such actions, suits, or proceedings,
(ii) the nature of the dispute that is the subject of such actions, suits, or
proceedings, (iii) the status, as of the Closing Date, with respect to such
actions, suits, or proceedings, and (iv) whether any liability of the Loan
Parties' and their Subsidiaries in connection with such actions, suits, or
proceedings is covered by insurance.

4.8Compliance with Laws. No Loan Party nor any of its Subsidiaries (a) is in
violation of any applicable laws, rules, regulations, executive orders, or codes
(including Environmental Laws) that, individually or in the aggregate, could
reasonably be expected to result in a Material Adverse Change, or (b) is subject
to or in default with respect to any final judgments, writs, injunctions,
decrees, rules or regulations of any court or any federal, state, municipal or
other governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign, that, individually or in the aggregate,
could reasonably be expected to result in a Material Adverse Change.

4.9No Material Adverse Change. All quarterly historical GAAP financial
statements relating to Borrower, on a consolidated basis, that have been
delivered by Borrower to Agent have been prepared in accordance with GAAP
(except, in the case of unaudited financial statements, for the lack of
footnotes and being subject to year-end audit adjustments) and present fairly in
all material respects, the Loan Parties' and their Subsidiaries' consolidated
financial condition as of the date thereof and results of operations for the
period then ended. Except as set forth on Schedule 4.9, since June 30, 2011, no
event, circumstance, or change has occurred that has or could reasonably be
expected to result in a Material Adverse Change with respect to the Loan Parties
and their Subsidiaries.

4.10Fraudulent Transfer.

(a)(i) The Loan Parties, on a consolidated basis, are Solvent and (ii) Borrower,
on an individual basis, is Solvent.

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

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4.11Employee Benefits. No Loan Party, none of their Subsidiaries, nor any of
their ERISA Affiliates maintains or contributes to any Benefit Plan.

4.12Environmental Condition. Except as set forth on Schedule 4.12, (a) to
Borrower's knowledge, no Loan Party's nor any of its Subsidiaries' properties or
assets has ever been used by a Loan Party, its Subsidiaries, or by previous
owners or operators in the disposal of, or to produce, store, handle, treat,
release, or transport, any Hazardous Materials, where such disposal, production,
storage, handling, treatment, release or transport was in violation, in any
material respect, of any applicable Environmental Law, (b) to Borrower's
knowledge, after due inquiry, no Loan Party's nor any of its Subsidiaries'
properties or assets has ever been designated or identified in any manner
pursuant to any environmental protection statute as a Hazardous Materials
disposal site, (c) no Loan Party nor any of its Subsidiaries has received notice
that a Lien (other than a Permitted Lien) arising under any Environmental Law
has attached to any revenues or to any Real Property owned or operated by a Loan
Party or its Subsidiaries, and (d) no Loan Party nor any of its Subsidiaries nor
any of their respective facilities or operations is subject to any outstanding
written order, consent decree, or settlement agreement with any Person relating
to any Environmental Law or Environmental Liability that, individually or in the
aggregate, could reasonably be expected to result in a Material Adverse Change.

4.13Reserved.

4.14Leases. Each Loan Party enjoys peaceful and undisturbed possession under all
leases material to their business and to which they are parties or under which
they are operating, and, subject to Permitted Protests, all of such material
leases are valid and subsisting and no material default by the applicable Loan
Party or its Subsidiaries exists under any of them that could reasonably be
expected to result in the termination thereof.

4.15Deposit Accounts and Securities Accounts. Set forth on Schedule 4.15 (as
updated pursuant to the provisions of the Security Agreement from time to time)
is a listing of all of the Loan Parties' Deposit Accounts and Securities
Accounts, including, with respect to each bank or securities intermediary (a)
the name and address of such Person, and (b) the account numbers of the Deposit
Accounts or Securities Accounts maintained with such Person.

4.16Complete Disclosure. All factual information taken as a whole (other than
forward-looking information and projections and information of a general
economic nature and general information about Borrower's industry) furnished by
or on behalf of a Loan Party or its Subsidiaries in writing to Agent or any
Lender (including all information contained in the Schedules hereto or in the
other Loan Documents) for purposes of or in connection with this Agreement or
the other Loan Documents, and all other such factual information taken as a
whole (other than forward-looking information and projections and information of
a general economic nature and general information about Borrower's industry)
hereafter furnished by or on behalf of a Loan Party or its Subsidiaries in
writing to Agent or any Lender will be, true and accurate, in all material
respects, on the date as of which such information is dated or certified and not
incomplete by omitting to state any fact necessary to make such information
(taken as a whole) not misleading in any material respect at such time in light
of the circumstances under which such information was provided. The Projections
delivered to Agent on September 2, 2011 represent, and as of the date on which
any other Projections are delivered to Agent, such additional Projections
represent, Borrower's good faith estimate, on the date such Projections are
delivered, of the Loan Parties' and their Subsidiaries' future performance for
the periods covered thereby based upon assumptions believed by Borrower to be
reasonable at the time of the delivery thereof to Agent (it being understood
that such Projections are subject to uncertainties and contingencies, many of
which are beyond the control of the Loan Parties and their Subsidiaries, that no
assurances can be given that such Projections will be realized, and that actual
results may differ in a material manner from such Projections).

4.17Designated Contracts. Set forth on Schedule 4.17 (as such Schedule may be
updated from time to time in accordance herewith) is a reasonably detailed
description of the Designated Contracts of each Loan Party as of the most recent
date on which Borrower provided its Compliance Certificate pursuant to Section
5.1; provided, however, that Borrower may amend Schedule 4.17 to add additional
Designated Contracts so long as such amendment occurs by written notice to Agent
on the date that Borrower provides its Compliance Certificate. Except for
matters which, either individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Change, each Designated Contract (other
than those that have expired at the end of their normal terms) (a) is in full
force and effect and is binding upon and enforceable against the applicable Loan
Party and, to Borrower's knowledge, each other Person that is a party thereto in
accordance with its terms, (b) has not been otherwise amended or modified (other
than amendments or modifications permitted by Section 6.7(b)), and (c) is not in
default due to the action or inaction of the applicable Loan Party.

4.18Patriot Act. To the extent applicable, each Loan Party is in compliance, in
all material respects, with the (a) Trading with the Enemy Act, as amended, and
each of the foreign assets control regulations of the United States Treasury
Department (31 CFR, Subtitle B, Chapter V, as amended) and any other enabling
legislation or executive order relating thereto,

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and (b) Uniting and Strengthening America by Providing Appropriate Tools
Required to Intercept and Obstruct Terrorism (USA Patriot Act of 2001) (the
“Patriot Act”). No part of the proceeds of the loans made hereunder will be used
by any Loan Party or any of their Affiliates, directly or indirectly, for any
payments to any governmental official or employee, political party, official of
a political party, candidate for political office, or anyone else acting in an
official capacity, in order to obtain, retain or direct business or obtain any
improper advantage, in violation of the United States Foreign Corrupt Practices
Act of 1977, as amended.

4.19Indebtedness. Set forth on Schedule 4.19 is a true and complete list of all
Indebtedness of each Loan Party outstanding immediately prior to the Closing
Date that is to remain outstanding immediately after giving effect to the
closing hereunder on the Closing Date and such Schedule accurately sets forth
the aggregate principal amount of such Indebtedness as of the Closing Date.

4.20Payment of Taxes. Except as otherwise permitted under Section 5.5, all
federal, foreign, state, local and other material tax returns and reports of
each Loan Party required to be filed by any of them have been timely filed, and
all taxes shown on such tax returns to be due and payable and all assessments,
fees and other governmental charges upon a Loan Party and upon their respective
assets, income, businesses and franchises that are due and payable have been
paid when due and payable. Borrower has made adequate provision in accordance
with GAAP for all taxes not yet due and payable. Borrower knows of no proposed
tax assessment against a Loan Party that is material to the business of Borrower
and the other Loan Parties (taken as a whole) and that is not being actively
contested by such Loan Party diligently, in good faith, and by appropriate
proceedings; provided such reserves or other appropriate provisions, if any, as
shall be required in conformity with GAAP shall have been made or provided
therefor.

4.21Margin Stock. No Loan Party nor any of its Subsidiaries is engaged
principally, or as one of its important activities, in the business of extending
credit for the purpose of purchasing or carrying any Margin Stock. No part of
the proceeds of the loans made to Borrower will be used to purchase or carry any
such Margin Stock or to extend credit to others for the purpose of purchasing or
carrying any such margin stock or for any purpose that violates the provisions
of Regulation T, U or X of the Board of Governors of the United States Federal
Reserve.

4.22Governmental Regulation. No Loan Party nor any of its Subsidiaries is
subject to regulation under the Federal Power Act or the Investment Company Act
of 1940 or under any other federal or state statute or regulation which may
limit its ability to incur Indebtedness or which may otherwise render all or any
portion of the Obligations unenforceable. No Loan Party nor any of its
Subsidiaries is a “registered investment company” or a company “controlled” by a
“registered investment company” or a “principal underwriter” of a “registered
investment company” as such terms are defined in the Investment Company Act of
1940.

4.23OFAC. No Loan Party nor any of its Subsidiaries is in violation of any of
the country or list based economic and trade sanctions administered and enforced
by OFAC. No Loan Party nor any of its Subsidiaries (a) is a Sanctioned Person or
a Sanctioned Entity, (b) has its assets located in Sanctioned Entities, or (c)
derives revenues from investments in, or transactions with Sanctioned Persons or
Sanctioned Entities. No proceeds of any loan made hereunder will be used to fund
any operations in, finance any investments or activities in, or make any
payments to, a Sanctioned Person or a Sanctioned Entity.

4.24Employee and Labor Matters. There is (i) no unfair labor practice complaint
pending or, to the knowledge of Borrower, threatened against Borrower or its
Subsidiaries before any Governmental Authority and no grievance or arbitration
proceeding pending or threatened against Borrower or its Subsidiaries which
arises out of or under any collective bargaining agreement and that could
reasonably be expected to result in a Material Adverse Change, (ii) no strike,
labor dispute, slowdown, stoppage or similar action or grievance pending or
threatened in writing against Borrower or its Subsidiaries that could reasonably
be expected to result in a Material Adverse Change, or (iii) to the knowledge of
Borrower, after due inquiry, no union representation question existing with
respect to the employees of Borrower or its Subsidiaries and no union organizing
activity taking place with respect to any of the employees of Borrower or its
Subsidiaries. None of Borrower or its Subsidiaries has incurred any liability or
obligation under the Worker Adjustment and Retraining Notification Act or
similar state law, which remains unpaid or unsatisfied and that could reasonably
be expected to result in a Material Adverse Change. The hours worked and
payments made to employees of Borrower or its Subsidiaries have not been in
violation of the Fair Labor Standards Act or any other applicable legal
requirements, except to the extent such violations could not, individually or in
the aggregate, reasonably be expected to result in a Material Adverse Change.
All material payments due from Borrower or its Subsidiaries on account of wages
and employee health and welfare insurance and other benefits have been paid or
accrued as a liability on the books of Borrower, except where the failure to do
so could not, individually or in the aggregate, reasonably be expected to result
in a Material Adverse Change.

4.25Eligible Accounts. As to each Account that is identified by Borrower as an
Eligible Account in a Borrowing Base Certificate submitted to Agent, such
Account is (a) a bona fide existing payment obligation of the applicable Account
Debtor created by the sale and delivery of Inventory or the rendition of
services to such Account Debtor in the ordinary course of Borrower's

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business, (b) owed to Borrower, and (c) not excluded as ineligible by virtue of
one or more of the excluding criteria (other than Agent-discretionary criteria)
set forth in the definition of Eligible Accounts.

4.26Eligible Inventory. As to each item of Inventory that is identified by
Borrower as Eligible Inventory in a Borrowing Base Certificate submitted to
Agent, such Inventory is (a) of good and merchantable quality, free from known
defects (other than defects that do not prevent satisfaction of the standard
requirements for delivery and acceptance of such Inventory), and (b) not
excluded as ineligible by virtue of one or more of the excluding criteria (other
than Agent-discretionary criteria) set forth in the definition of Eligible
Inventory.

4.27Locations of Inventory and Equipment. The Inventory and material Equipment
(other than vehicles or Equipment out for repair) of the Loan Parties and their
Subsidiaries are not stored with a bailee, warehouseman, or similar party
(unless such bailee, warehouseman, or similar party is identified on Schedule
4.27) and are located only at, or in-transit between or to, the locations
identified on Schedule 4.27 (as such Schedule may be updated pursuant to Section
5.15).

4.28Inventory Records. Borrower keeps correct and accurate records itemizing and
describing the type, initial release date, and quantity of its and its
Subsidiaries' Inventory and the book value thereof.

4.29Eligible Titles. As to each video game title that is identified by Borrower
as part of the Eligible Titles in a Borrowing Base Certificate submitted to
Agent, such video game title, and the Intellectual Property associated
therewith, is (a) owned by Borrower and not subject to a license from any Person
other than middleware licenses and immaterial licenses for music or other
content utilized in such video game title, and not subject to a license to any
Person other than as set forth in clause (d) of the definition of “Permitted IP
Disposition”, and (b) not excluded as ineligible by virtue of one or more of the
excluding criteria (other than Agent-discretionary criteria) set forth in the
definition of Eligible Titles.

4.30Inactive Subsidiaries. The Inactive Subsidiaries conduct no business and
have no material assets or liabilities.

4.31JAKKS Agreements. There is no default or breach under any of the JAKKS
Agreements and the only remaining payments owed by Borrower or any Loan Party
under the JAKKS Agreements are: (a) a $4,000,000 payment due on June 30, 2012
and (b) a $4,000,000 payment due on June 30, 2013.

4.32Intellectual Property Claims. Except as disclosed on Schedule 4.32, there is
no pending or, to any Borrower's knowledge, threatened Intellectual Property
Claim with respect to Borrower, any Loan Party or any of their property
(including any Intellectual Property) that, if upheld, could reasonably be
expected to result in a Material Adverse Change. Except as disclosed on Schedule
4.32, neither Borrower nor any Loan Party pays or owes any Royalty or other
compensation to any Person with respect to any Material Intellectual Property
License.

4.33No Defaults. Neither Borrower nor any Loan Party is in material default, and
no event or circumstance has occurred or exists that with the passage of time or
giving of notice would constitute a default, under any Material IP, Designated
Contract or in the payment of any borrowed money. Except as shown on Schedule
4.33, there is no basis upon which any party (other than Borrower or a Loan
Party) could terminate any Material IP or a Designated Contract prior to its
scheduled termination date.

5.
AFFIRMATIVE COVENANTS.

Borrower covenants and agrees that, until termination of all of the Commitments
and payment in full of the Obligations, the Loan Parties shall comply with each
of the following:
5.1Financial Statements, Reports, Certificates. Deliver to Agent, with copies to
each Lender, each of the financial statements, reports, and other items set
forth on Schedule 5.1 no later than the times specified therein. In addition,
Borrower agrees to maintain a system of accounting that enables Borrower to
produce financial statements in accordance with GAAP. Borrower shall also (a)
keep a reporting system that shows all additions, sales, claims, returns, and
allowances with respect to its and the other Loan Parties' sales, and (b)
maintain its billing systems/practices substantially as in effect as of the
Closing Date and shall only make material modifications thereto with notice to
Agent.

5.2Collateral Reporting. Provide Agent (and if so requested by Agent, with
copies for each Lender) with each of the reports set forth on Schedule 5.2 at
the times specified therein. In addition, Borrower agrees to use commercially
reasonable efforts in cooperation with Agent to facilitate and implement a
system of electronic collateral reporting in order to provide electronic
reporting of each of the items set forth on such Schedule.

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5.3Existence. Except as otherwise permitted under Section 6.3 or Section 6.4, at
all times maintain and preserve in full force and effect its existence
(including being in good standing in its jurisdiction of organization) and all
rights and franchises, licenses and permits material to its business; provided,
however, that no Loan Party shall be required to preserve any such right or
franchise, licenses or permits if (A) it expires by its terms, or (B) the
preservation thereof, in the reasonable business and commercial judgment of the
officers of such Loan Party, is no longer desirable in the conduct of the
business of such Loan Party.

5.4Maintenance of Properties. Unless a Loan Party other than Borrower is merged
into Borrower pursuant to Section 6.3 or discontinued pursuant to Section 6.6,
maintain and preserve all of its assets that are necessary or useful in the
proper conduct of its business in good working order and condition, ordinary
wear, tear, and casualty excepted and Permitted Dispositions excepted, and
comply with the material provisions of all material leases to which it is a
party as lessee, so as to prevent the loss or forfeiture thereof, unless such
provisions are the subject of a Permitted Protest.

5.5Taxes. Cause all material assessments and taxes imposed, levied, or assessed
against any Loan Party, or any of their respective assets or in respect of any
of its income, businesses, or franchises to be paid in full, before delinquency
or before the expiration of any extension period, except to the extent that the
validity of such assessment or tax shall be the subject of a Permitted Protest
and so long as, in the case of an assessment or tax that has or may become a
Lien against any of the Collateral, such contest proceedings conclusively
operate to stay the sale of any portion of the Collateral to satisfy such
assessment or tax. Borrower will and will cause each of the other Loan Parties
to make timely payment or deposit of all material tax payments and withholding
taxes required of it and them by applicable laws, including those laws
concerning F.I.C.A., F.U.T.A., state disability, and local, state, and federal
income taxes, and will, upon request, furnish Agent with proof reasonably
satisfactory to Agent indicating that Borrower and the Loan Parties have made
such payments or deposits.

5.6Insurance. At Borrower's expense, maintain insurance respecting each of the
Loan Parties' and their Subsidiaries' assets wherever located, covering loss or
damage by fire, theft, explosion, and all other hazards and risks as ordinarily
are insured against by other Persons engaged in the same or similar businesses.
Borrower also shall maintain (with respect to each of the Loan Parties) general
liability, product liability insurance, director's and officer's liability
insurance, and fiduciary liability insurance, as well as insurance against
larceny, embezzlement, and criminal misappropriation. All such policies of
insurance shall be with responsible and reputable insurance companies acceptable
to Agent and in such amounts as is carried generally in accordance with sound
business practice by companies in similar businesses similarly situated and
located and in any event in amount, adequacy and scope reasonably satisfactory
to Agent. All property insurance policies covering the Collateral are to be made
payable to Agent for the benefit of Agent and the Lenders, as their interests
may appear, in case of loss, pursuant to a standard loss payable endorsement
with a standard non contributory “lender” or “secured party” clause and are to
contain such other provisions as Agent may reasonably require to fully protect
the Lenders' interest in the Collateral and to any payments to be made under
such policies. All certificates of property and general liability insurance are
to be delivered to Agent, with the loss payable (but only in respect of
Collateral) and additional insured endorsements in favor of Agent and shall
provide for not less than 30 days (10 days in the case of non-payment), or, in
either case, such other period as Agent may consent to, prior written notice to
Agent of the exercise of any right of cancellation. If Borrower fails to
maintain such insurance, Agent may arrange for such insurance, but at Borrower's
expense and without any responsibility on Agent's part for obtaining the
insurance, the solvency of the insurance companies, the adequacy of the
coverage, or the collection of claims. Borrower shall give Agent prompt notice
of any loss exceeding $1,000,000 covered by its casualty insurance. Upon the
occurrence and during the continuance of an Event of Default, Agent shall have
the sole right to file claims under any property and general liability insurance
policies in respect of the Collateral, to receive, receipt and give acquittance
for any payments that may be payable thereunder, and to execute any and all
endorsements, receipts, releases, assignments, reassignments or other documents
that may be necessary to effect the collection, compromise or settlement of any
claims under any such insurance policies.

5.7Inspection. Permit Agent and each of its duly authorized representatives or
agents to visit any of its properties and inspect any of its assets or books and
records, to conduct appraisals and valuations, to examine and make copies of its
books and records, and to discuss its affairs, finances, and accounts with, and
to be advised as to the same by, its officers and employees at such reasonable
times during normal business hours and intervals as Agent may designate and, so
long as no Default or Event of Default exists, with reasonable prior notice to
Borrower. It is understood that Agent intends to conduct at least 2 audits
and/or field examinations, 2 appraisals of Inventory, and 1 appraisal of
Intellectual Property each Fiscal Year.

5.8Compliance with Laws. Comply with the requirements of all applicable laws,
rules, regulations, and orders of any Governmental Authority, other than laws,
rules, regulations, and orders the non-compliance with which, individually or in
the aggregate, could not reasonably be expected to result in a Material Adverse
Change.

5.9Environmental.

(a)Keep any property either owned or operated by Borrower or the other Loan
Parties free of any

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Environmental Liens or post bonds or other financial assurances sufficient to
satisfy the obligations or liability evidenced by such Environmental Liens,

(b)Comply, in all material respects, with Environmental Laws and provide to
Agent documentation of such compliance which Agent reasonably requests,

(c)Promptly notify Agent of any release of which Borrower has knowledge of a
Hazardous Material in any reportable quantity from or onto property owned or
operated by Borrower or its Subsidiaries and take any Remedial Actions required
to abate said release or otherwise to come into compliance, in all material
respects, with applicable Environmental Law, and

(d)Promptly, but in any event within 5 Business Days of its receipt thereof,
provide Agent with written notice of any of the following: (i) notice that an
Environmental Lien has been filed against any of the real or personal property
of Borrower or its Subsidiaries, (ii) commencement of any Environmental Action
or written notice that an Environmental Action will be filed against Borrower or
its Subsidiaries, and (iii) written notice of a material violation, citation, or
other administrative order from a Governmental Authority.

5.10Disclosure Updates. Promptly and in no event later than 5 Business Days
after obtaining knowledge thereof, notify Agent if any written information,
exhibit, or report furnished to Agent or the Lenders contained, at the time it
was furnished, any untrue statement of a material fact or omitted to state any
material fact necessary to make the statements contained therein not misleading
in light of the circumstances in which made. The foregoing to the contrary
notwithstanding, any notification pursuant to the foregoing provision will not
cure or remedy the effect of the prior untrue statement of a material fact or
omission of any material fact nor shall any such notification have the effect of
amending or modifying this Agreement or any of the Schedules hereto.

5.11Formation of Subsidiaries. At the time that any Loan Party forms any direct
or indirect Subsidiary or acquires any direct or indirect Subsidiary after the
Closing Date, such Loan Party shall (a) within 10 Business Days of such
formation or acquisition (or such later date as permitted by Agent in its sole
discretion) cause any such new Subsidiary to provide to Agent a joinder to the
Guaranty and the Security Agreement, together with such other security documents
(including mortgages with respect to any Real Property owned in fee of such new
Subsidiary with a fair market value of at least $500,000), as well as
appropriate financing statements (and with respect to all property subject to a
mortgage, fixture filings), all in form and substance reasonably satisfactory to
Agent (including being sufficient to grant Agent a first priority Lien (subject
to Permitted Liens) in and to the assets of such newly formed or acquired
Subsidiary); provided that the Guaranty, the Security Agreement, and such other
security documents shall not be required to be provided to Agent with respect to
any Subsidiary of Borrower that is a CFC if providing such documents would
result in adverse tax consequences or the costs to the Loan Parties of providing
such Guaranty, executing any security documents or perfecting the security
interests created thereby are unreasonably excessive (as determined by Agent in
consultation with Borrower) in relation to the benefits of Agent and the Lenders
of the security or guarantee afforded thereby, (b) within 30 days of such
formation or acquisition (or such later date as permitted by Agent in its sole
discretion) provide to Agent a pledge agreement (or an addendum to the Security
Agreement) and appropriate certificates and powers or financing statements,
pledging all of the direct or beneficial ownership interest in such new
Subsidiary reasonably satisfactory to Agent; provided that only 65% of the total
outstanding voting Stock of any first tier Subsidiary of Borrower that is a CFC
(and none of the Stock of any Subsidiary of such CFC) shall be required to be
pledged if pledging a greater amount would result in adverse tax consequences or
the costs to the Loan Parties of providing such pledge or perfecting the
security interests created thereby are unreasonably excessive (as determined by
Agent in consultation with Borrower) in relation to the benefits of Agent and
the Lenders of the security or guarantee afforded thereby (which pledge, if
reasonably requested by Agent, shall be governed by the laws of the jurisdiction
of such Subsidiary), and (c) within 30 days of such formation or acquisition (or
such later date as permitted by Agent in its sole discretion) provide to Agent
all other documentation, including one or more opinions of counsel reasonably
satisfactory to Agent, which in its opinion is appropriate with respect to the
execution and delivery of the applicable documentation referred to above
(including policies of title insurance or other documentation with respect to
all Real Property owned in fee and subject to a mortgage). Any document,
agreement, or instrument executed or issued pursuant to this Section 5.11 shall
be a Loan Document.

5.12Further Assurances. At any time upon the reasonable request of Agent,
execute or deliver to Agent any and all financing statements, fixture filings,
security agreements, pledges, assignments, endorsements of certificates of
title, mortgages, deeds of trust, opinions of counsel, and all other documents
(the “Additional Documents”) that Agent may reasonably request in form and
substance reasonably satisfactory to Agent, to create, perfect, and continue
perfected or to better perfect Agent's Liens in all of the assets of Borrower
and the Loan Parties (whether now owned or hereafter arising or acquired,
tangible or intangible, real or personal), to create and perfect Liens in favor
of Agent in any Real Property acquired by Borrower or the Loan Parties after the
Closing Date with a fair market value in excess of $500,000, and in order to
fully consummate all of the transactions contemplated hereby and under the other
Loan Documents; provided that the foregoing shall not apply to any Subsidiary of
Borrower that is a

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CFC if providing such documents would result in adverse tax consequences or the
costs to the Loan Parties of providing such documents are unreasonably excessive
(as determined by Agent in consultation with Borrower) in relation to the
benefits of Agent and the Lenders of the benefits afforded thereby. To the
maximum extent permitted by applicable law, if Borrower refuses or fails to
execute or deliver any reasonably requested Additional Documents within a
reasonable period of time following the request to do so, Borrower hereby
authorizes Agent to execute any such Additional Documents in the applicable Loan
Party's or its Subsidiary's name, as applicable, and authorizes Agent to file
such executed Additional Documents in any appropriate filing office. In
furtherance and not in limitation of the foregoing, each Loan Party shall take
such actions as Agent may reasonably request from time to time to ensure that
the Obligations are guarantied by the Guarantors and are secured by
substantially all of the assets of Borrower and the other Loan Parties and all
of the outstanding capital Stock of Borrower's Subsidiaries (subject to
exceptions and limitations contained in the Loan Documents with respect to
CFCs).

5.13Lender Meetings. Within 90 days after the close of each fiscal year of
Borrower, at the request of Agent or of the Required Lenders and upon reasonable
prior notice, hold a meeting (at a mutually agreeable location and time or, at
the option of Agent, by conference call) with all Lenders who choose to attend
such meeting (the non-attendance of any Lender at such meeting shall not
constitute a failure of the Loan Parties to comply with this Section 5.13) at
which meeting shall be reviewed the financial results of the previous fiscal
year and the financial condition of Borrower and its Subsidiaries and the
projections presented for the current fiscal year of Borrower.

5.14Designated Contracts. Contemporaneously with the delivery of each Compliance
Certificate pursuant to Section 5.1, provide Agent with copies of (a) each
Designated Contract entered into since the delivery of the previous Compliance
Certificate, (b) each contract that has become a Designated Contract since the
delivery of the previous Compliance Certificate, and (c) each material amendment
or modification of any Designated Contract entered into since the delivery of
the previous Compliance Certificate.

5.15Location of Inventory and Equipment. Keep each Loan Parties' Inventory and
material Equipment (other than vehicles and Equipment out for repair) only at
the locations identified on Schedule 4.27 and their chief executive offices only
at the locations identified on Schedule 4.6(b); provided, however, that Borrower
may amend Schedule 4.27 or Schedule 4.6(b) so long as such amendment occurs by
written notice to Agent not less than 10 days prior to the date on which such
Inventory or Equipment is moved to such new location or such chief executive
office is relocated and so long as such new location is within the continental
United States, and so long as, at the time of such written notification,
Borrower provides Agent a Collateral Access Agreement with respect thereto.

5.16Reserved.

5.17Reserved.

5.18Intellectual Property Licenses.

(a)Pay or set-off all Royalties when due, except to the extent the same are
being actively contested by the applicable Loan Party diligently, in good faith,
and by appropriate proceedings, or as permitted under the applicable agreement.

(b)Notify Agent of any default or breach asserted in writing by any Person to
have occurred under any Intellectual Property License.

6.
NEGATIVE COVENANTS.

Borrower covenants and agrees that, until termination of all of the Commitments
and payment in full of the Obligations, the Loan Parties will not do any of the
following:
6.1Indebtedness. Create, incur, assume, suffer to exist, guarantee, or otherwise
become or remain, directly or indirectly, liable with respect to any
Indebtedness, except for Permitted Indebtedness.

6.2Liens. Create, incur, assume, or suffer to exist, directly or indirectly, any
Lien on or with respect to any of its assets, of any kind, whether now owned or
hereafter acquired, or any income or profits therefrom, except for Permitted
Liens.

6.3Restrictions on Fundamental Changes.

(a)Other than in order to consummate a Permitted Acquisition, enter into any
merger, consolidation, reorganization, or recapitalization, or reclassify its
Stock, except for (i) any merger between Loan Parties, provided that Borrower

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must be the surviving entity of any such merger to which it is a party (ii) any
merger between a Loan Party and Subsidiaries of such Loan Party that are not
Loan Parties so long as such Loan Party is the surviving entity of any such
merger, and (iii) any merger between Subsidiaries of Borrower that are not Loan
Parties,

(b)Liquidate, wind up, or dissolve itself (or suffer any liquidation or
dissolution), except for (i) the liquidation or dissolution of non-operating
Subsidiaries of Borrower with nominal assets and nominal liabilities, (ii) the
liquidation or dissolution of a Loan Party (other than Borrower) or any of its
wholly-owned Subsidiaries so long as all of the assets (including any interest
in any Stock) of such liquidating or dissolving Loan Party or Subsidiary are
transferred to a Loan Party that is not liquidating or dissolving, or (iii) the
liquidation or dissolution of a Subsidiary of Borrower that is not a Loan Party
(other than any such Subsidiary the Stock of which (or any portion thereof) is
subject to a Lien in favor of Agent) so long as all of the assets of such
liquidating or dissolving Subsidiary are transferred to a Subsidiary of Borrower
that is not liquidating or dissolving, or

(c)Suspend or go out of a substantial portion of its or their business, except
as permitted pursuant to clauses (a) or (b) above or in connection with the
transactions permitted pursuant to Section 6.4.

6.4Disposal of Assets. Other than Permitted Dispositions or transactions
expressly permitted by Sections 6.3 or 6.11, convey, sell, lease, license,
assign, transfer, or otherwise dispose of (or enter into an agreement to convey,
sell, lease, license, assign, transfer, or otherwise dispose of) any of
Borrower's or a Loan Party's assets.

6.5Change Name. Change Borrower's or any of the Loan Parties' names,
organizational identification numbers, states of organization or organizational
identities; provided, however, that Borrower or any of the Loan Parties may
change its name upon at least 10 days prior written notice to Agent of such
change.

6.6Nature of Business. Make any change in the nature of its or their business as
described in Schedule 6.6 or acquire any properties or assets that are not
reasonably related to the conduct of such business activities; provided,
however, that the foregoing shall not prevent Borrower and its Subsidiaries from
(a) engaging in any business that is reasonably related or ancillary to its or
their business or (b) discontinuing any line of business if in the reasonable
business and commercial judgment of the officers of Borrower, it is no longer
desirable to be engaged in such business.

6.7Prepayments and Amendments.

(a)Except in connection with Refinancing Indebtedness permitted by Section 6.1,

(i)optionally or mandatorily prepay, redeem, defease, purchase, or otherwise
acquire any Indebtedness of Borrower or its Subsidiaries, other than (A) the
Obligations in accordance with this Agreement, and (B) Permitted Intercompany
Advances (but only to the extent permitted by the terms of the Intercompany
Subordination Agreement and Section 6.12(e)); provided, however, Borrower may
(x) optionally prepay, redeem, defease, or purchase the Convertible Senior Notes
(an “Optional Prepayment”) so long as (1) it is permitted by law, (2) no Default
or Event of Default shall have occurred and be continuing or would result
therefrom, (3) after giving effect to such Optional Prepayment, Borrower is in
compliance with the financial covenants in Section 7 (regardless of whether a
Trigger Period is in effect) for the 4 fiscal quarter period ended immediately
prior to such Optional Prepayment, (4) the sum of (aa) Availability plus (bb)
Borrower's Qualified Cash is at least $50,000,000 immediately after giving
effect to such Optional Prepayment, and (5) Borrower has provided Agent with
written confirmation, supported by reasonably detailed calculations, that
Borrower would meet the test in the preceding clause (4) on the last day of each
of the 12 months following such Optional Prepayment and (y) mandatorily purchase
the Convertible Senior Notes in accordance with Article 7 of the Indenture as in
effect on the Closing Date, or

(ii)make any payment on account of Indebtedness that has been contractually
subordinated in right of payment to the Obligations if such payment is not
permitted at such time under the subordination terms and conditions, or

(b)Directly or indirectly, amend, modify, or change any of the terms or
provisions of

(i)any agreement, instrument, document, indenture, or other writing evidencing
or concerning Permitted Indebtedness other than (A) the Obligations in
accordance with this Agreement, (B) Permitted Intercompany Advances, and (C)
Indebtedness permitted under clauses (c), (h), (j) and (k) of the definition of
Permitted Indebtedness,

(ii)any Designated Contract except to the extent that such amendment,
modification, or change could not, individually or in the aggregate, reasonably
be expected to result in a Material Adverse Change, or

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(iii)the Governing Documents of any Loan Party if the effect thereof, either
individually or in the aggregate, could reasonably be expected to be materially
adverse to the interests of the Lenders.

6.8Change of Control. Cause, permit, or suffer, directly or indirectly, any
Change of Control.

6.9Restricted Junior Payments. Make any Restricted Junior Payment; provided,
however, that,

(a)Borrower may make a Restricted Junior Payment so long as (i) it is permitted
by law, (ii) no Default or Event of Default shall have occurred and be
continuing or would result therefrom, (iii) after giving effect to such
Restricted Junior Payment, Borrower is in compliance with the financial
covenants in Section 7 (regardless of whether a Trigger Period is in effect) for
the 4 fiscal quarter period ended immediately prior to such Restricted Junior
Payment, (iv) the sum of (A) Availability plus (B) Borrower's Qualified Cash is
at least $50,000,000 immediately after giving effect to such Restricted Junior
Payment, and (v) Borrower has provided Agent with written confirmation,
supported by reasonably detailed calculations, that Borrower would meet the test
in the preceding clause (iv) on the last day of each of the 12 months following
such Restricted Junior Payment,

(b)So long as no Default or Event of Default shall have occurred and be
continuing or would result therefrom, Borrower may make distributions to former
employees, officers, or directors of Borrower (or any spouses, ex-spouses, or
estates of any of the foregoing) on account of redemptions of Stock of Borrower
held by such Persons, provided further, however, that the aggregate amount of
such redemptions made by Borrower during the term of this Agreement plus the
amount of Indebtedness outstanding under clause (l) of the definition of
Permitted Indebtedness, does not exceed $2,000,000 in the aggregate, and

(c)So long as no Default or Event of Default shall have occurred and be
continuing or would result therefrom, Borrower may make distributions to former
employees, officers, or directors of Borrower (or any spouses, ex-spouses, or
estates of any of the foregoing), solely in the form of forgiveness of
Indebtedness of such Persons owing to Borrower on account of repurchases of the
Stock of Borrower held by such Persons; provided further that such Indebtedness
was incurred by such Persons solely to acquire Stock of Borrower.

6.10Accounting Methods. Modify or change its fiscal year or its method of
accounting (other than as may be required to conform to, or be permitted by,
GAAP).

6.11Investments; Controlled Investments.

(a)Except for Permitted Investments, directly or indirectly, make or acquire any
Investment or incur any liabilities (including contingent obligations) for or in
connection with any Investment.

(b)Other than (i) an aggregate amount of not more than $50,000 at any one time,
in the case of Borrower and its Subsidiaries (other than those Subsidiaries that
are CFCs), (ii) amounts deposited into Deposit Accounts specially and
exclusively used for payroll, payroll taxes and other employee wage and benefit
payments to or for Borrower's or its Subsidiaries' employees, and (iii) at any
time a Trigger Period is in effect, an aggregate amount of not more than
$100,000 (calculated at current exchange rates) at any one time, in the case of
Subsidiaries of Borrower that are CFCs), make, acquire, or permit to exist
Permitted Investments consisting of cash, Cash Equivalents, or amounts credited
to Deposit Accounts or Securities Accounts unless Borrower or its Subsidiary, as
applicable, and the applicable bank or securities intermediary have entered into
Control Agreements with Agent governing such Permitted Investments in order to
perfect (and further establish) Agent's Liens in such Permitted Investments.
Except as provided in Section 6.11(b)(i), (ii), and (iii), Borrower shall not
and shall not permit its Subsidiaries to establish or maintain any Deposit
Account or Securities Account unless Agent shall have received a Control
Agreement in respect of such Deposit Account or Securities Account.

6.12Transactions with Affiliates. Directly or indirectly enter into or permit to
exist any transaction with any Affiliate of Borrower or any of its Subsidiaries
except for:

(a)transactions between Borrower or its Subsidiaries, on the one hand, and any
Affiliate of Borrower or its Subsidiaries, on the other hand, so long as such
transactions (i) are fully disclosed to Agent prior to the consummation thereof,
if they involve one or more payments by Borrower or its Subsidiaries in excess
of $1,000,000 for any single transaction or series of related transactions
(other than arms-length, routine transfer pricing transactions made in the
ordinary course of business), and (ii) are no less favorable, taken as a whole,
to Borrower or its Subsidiaries, as applicable, than would be obtained in an
arm's length transaction with a non-Affiliate,

(b)so long as it has been approved by Borrower's or its applicable Subsidiary's
board of directors (or comparable governing body) in accordance with applicable
law, any indemnity provided for the benefit of directors (or comparable

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managers) of Borrower or its applicable Subsidiary,

(c)so long as it has been approved by Borrower's or its applicable Subsidiary's
board of directors (or comparable governing body) in accordance with applicable
law, the payment of reasonable compensation, severance, or employee benefit
arrangements to employees, officers, and outside directors of Borrower and its
Subsidiaries in the ordinary course of business and consistent with industry
practice,

(d)transactions permitted by Section 6.3 or Section 6.9, or clauses (e), (g),
(j) and (l) of the definition of “Permitted Investment”; and

(e)in the case of a Permitted Intercompany Advance from a non-Loan Party to a
Loan Party, the repayment of such Permitted Intercompany Advance so long as (i)
it is permitted by law, (ii) no Default or Event of Default shall have occurred
and be continuing or would result therefrom, and (iii) the sum of (A)
Availability plus (B) Borrower's Qualified Cash is at least $7,500,000
immediately after giving effect to such repayment.

6.13Use of Proceeds. Use the proceeds of any loan made hereunder for any purpose
other than (a) on the Closing Date, (i) to repay, in full, the outstanding
principal, accrued interest, and accrued fees and expenses owing under or in
connection with the Existing Credit Facility, and (ii) to pay transactional
fees, costs, and expenses incurred in connection with this Agreement, the other
Loan Documents, and the transactions contemplated hereby and thereby, and (b)
thereafter, consistent with the terms and conditions hereof, for their lawful
and permitted purposes (including that no part of the proceeds of the loans made
to Borrower will be used to purchase or carry any such Margin Stock or to extend
credit to others for the purpose of purchasing or carrying any such margin stock
or for any purpose that violates the provisions of Regulation T, U or X of the
Board of Governors of the United States Federal Reserve).

6.14Limitation on Issuance of Stock. Except for the issuance or sale of common
stock or Permitted Preferred Stock by Borrower, issue or sell or enter into any
agreement or arrangement for the issuance and sale of any of its Stock.

6.15Consignments. Consign any of its or their Inventory or sell any of its or
their Inventory on bill and hold, sale or return, sale on approval, or other
conditional terms of sale, except for such consignments or such other
conditional sales in an aggregate amount not exceeding $2,000,000 at any one
time.

6.16Inventory and Equipment with Bailees. Store the Inventory or Equipment of
Borrower or the other Loan Parties, in an amount exceeding $1,500,000 in the
aggregate. at any time now or hereafter with a bailee, warehouseman, or similar
party unless with respect to such storage (a) Borrower has provided written
notice to Agent and (b) a Collateral Access Agreement in form reasonably
acceptable to Agent has been provided to Agent.

6.17Inactive Subsidiaries. Allow the Inactive Subsidiaries to conduct business
or have any material assets or liabilities, unless it shall become a Guarantor
and Pledgor pursuant to the provisions of Section 5.11 herein.

7.
FINANCIAL COVENANTS.

Borrower covenants and agrees that, until termination of all of the Commitments
and payment in full of the Obligations, Borrower will:
(a)Minimum EBITDA. Achieve EBITDA of at least the amount set forth below for the
applicable period set forth below, measured for any fiscal quarter-end ending
during or immediately before a Trigger Period:

Applicable Amount
Applicable Period
-$90,700,000
For the 1 fiscal quarter
ending September 30, 2011
$73,300,000
For the 2 fiscal quarters
ending December 31, 2011
$63,300,000
For the 3 fiscal quarters
ending March 31, 2012
$9,800,000
For the 4 fiscal quarters
ending June 30, 2012

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(b)Fixed Charge Coverage Ratio. Have a Fixed Charge Coverage Ratio, measured on
a fiscal quarter-end basis, of at least the required amount set forth in the
following table for the applicable period set forth opposite thereto, measured
for any fiscal quarter-end ending during or immediately before a Trigger Period:
Applicable Ratio
Applicable Period
1.1:1.0
For the 12 month period
ending September 30, 2012
1.1:1.0
For the 12 month period ending
each fiscal quarter thereafter

For purposes of determining whether Borrower has failed to comply with the
requirements of Section 7(a) or this Section 7(b), Borrower shall have the right
(the “Cure Right”) to increase EBITDA for any month by the amount of cash
proceeds (the “Cure Amount”) actually received by Borrower in return for the
issuance of its Stock (other than Prohibited Preferred Stock) after the first
day of such fiscal quarter and on or prior to the date that is 10 days after the
date on which financial statements with respect to such fiscal quarter are
required to be delivered pursuant to Section 5.1 (the “Cure Date”) (it being
understood and agreed that a given Cure Amount shall only increase EBITDA as
provided herein for a single fiscal quarter (and any period which includes such
fiscal quarter) and that, on or prior to the Cure Date, Borrower shall inform
Agent of the Cure Amount and the respective fiscal quarter for which the same
shall be deemed to increase EBITDA as provided herein), whereupon the financial
covenant set forth in Section 7(a) or this Section 7(b), as applicable, shall be
recalculated giving effect to the following pro forma adjustments:

(i)EBITDA shall be increased, solely for the purpose of determining the
existence of a Default or Event of Default under the financial covenants set
forth in Section 7(a) or this Section 7(b) with respect to any period of 4
fiscal quarters that includes the fiscal quarter for which the Cure Right was
exercised and not for any other purpose under this Agreement, by an amount equal
to the Cure Amount; and

(ii)if, after giving effect to the foregoing recalculations, Borrower shall then
be in compliance with the requirements of Section 7(a) or this Section 7(b), as
applicable, Borrower shall be deemed to have satisfied the requirements of
Section 7(a) or this Section 7(b), as applicable, as of the relevant date of
determination with the same effect as though there had been no failure to comply
therewith at such date, and the applicable breach or default of Section 7(a) or
this Section 7(b), as applicable, that had occurred shall be deemed cured for
the purposes of this Agreement.

Notwithstanding anything herein to the contrary, (i) in each rolling 4 fiscal
quarter period there shall be a period of at least 2 fiscal quarters in which no
Cure Right is made, (ii) the Cure Right may not be used for 2 consecutive
quarters, (iii) during the term of this Agreement there shall be no more than 4
fiscal quarters in which a Cure Right is made, (iv) any Cure Amount shall be no
greater than the amount required to cause the Borrower to be in compliance with
Section 7(a) or this Section 7(b), as applicable, (v) the Cure Amount shall not
to exceed $15,000,000 in the aggregate during the term of this Agreement, and
(vi) 100% of each Cure Amount shall be paid to Agent to be applied first to the
payment of then outstanding principal with respect to Advances (without a
corresponding reduction of the Commitments), second to provide Letter of Credit
Collateralization with respect to all outstanding Letters of Credit and third to
Borrower by transfer to the Designated Account.

(c)Capital Expenditures. Make Capital Expenditures in any fiscal year that would
result in the aggregate amount of Capital Expenditures made in such fiscal year,
measured quarterly as of any fiscal quarter-end ending during or immediately
before a Trigger Period, to exceed the amount set forth in the following table
for the applicable period:
Fiscal Year 2012
Each Fiscal Year thereafter
$17,000,000
$17,000,000

provided, however, that if the amount of Capital Expenditures permitted to be
made in any fiscal year as set forth in the above table is greater than the
actual amount of the Capital Expenditures actually made in such fiscal year (the
amount by which such permitted Capital Expenditures for such fiscal year exceeds
the actual amount of Capital Expenditures for such fiscal year, the “Excess
Amount”), then the lesser of (i) such Excess Amount and (ii) 50% of the amount
set forth in the above table for the next succeeding fiscal year (such lesser
amount referred to as the “Carry-Over Amount”) may be carried forward to the
next

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succeeding fiscal year (the “Succeeding Fiscal Year”); provided further,
however, that the Carry-Over Amount applicable to a particular Succeeding Fiscal
Year may not be used in that fiscal year until the amount permitted above to be
expended in such fiscal year has first been used in full and the Carry-Over
Amount applicable to a particular Succeeding Fiscal Year may not be carried
forward to another fiscal year.

8.
EVENTS OF DEFAULT.

Any one or more of the following events shall constitute an event of default
(each, an “Event of Default”) under this Agreement:
8.1If Borrower fails to pay when due and payable, or when declared due and
payable, (a) all or any portion of the Obligations consisting of interest, fees,
or charges due the Lender Group, reimbursement of Lender Group Expenses, or
other amounts (other than any portion thereof constituting principal)
constituting Obligations (including any portion thereof that accrues after the
commencement of an Insolvency Proceeding, regardless of whether allowed or
allowable in whole or in part as a claim in any such Insolvency Proceeding), and
such failure continues for a period of 3 Business Days, or (b) all or any
portion of the principal of the Obligations;

8.2If any Loan Party:

(a)fails to perform or observe any covenant or other agreement contained in any
of (i) Sections 3.6, 5.1, 5.2, 5.3 (solely if Borrower is not in good standing
in its jurisdiction of organization), 5.6, 5.7 (solely if Borrower refuses to
allow Agent or its representatives or agents to visit Borrower's properties,
inspect its assets or books or records, examine and make copies of its books and
records, or discuss Borrower's affairs, finances, and accounts with officers and
employees of Borrower), 5.10, 5.11, 5.13, or 5.15 of this Agreement, (ii)
Sections 6.1 through 6.16 of this Agreement, (iii) Section 7 of this Agreement,
or (iv) Section 6 of the Security Agreement (taking into account any applicable
cure periods set forth therein);

(b)fails to perform or observe any covenant or other agreement contained in any
of Sections 5.3 (other than if Borrower is not in good standing in its
jurisdiction of organization), 5.5, 5.8, 5.12, and 5.14 of this Agreement and
such failure continues for a period of 10 days after the earlier of (i) the date
on which such failure shall first become known to any executive, legal or
finance officer of Borrower or (ii) the date on which written notice thereof is
given to Borrower by Agent; or

(c)fails to perform or observe any covenant or other agreement contained in this
Agreement, or in any of the other Loan Documents, in each case, other than any
such covenant or agreement that is the subject of another provision of this
Section 8 (in which event such other provision of this Section 8 shall govern),
and such failure continues for a period of 30 days after the earlier of (i) the
date on which such failure shall first become known to any officer of Borrower
or (ii) the date on which written notice thereof is given to Borrower by Agent;

8.3If one or more judgments, orders, or awards for the payment of money
involving an aggregate amount of $1,000,000, or more (except to the extent fully
covered (other than to the extent of customary deductibles) by insurance
pursuant to which the insurer has not denied coverage) is entered or filed
against a Loan Party or any of its Subsidiaries, or with respect to any of their
respective assets, and either (a) there is a period of 30 consecutive days at
any time after the entry of any such judgment, order, or award during which (1)
the same is not discharged, satisfied, vacated, or bonded pending appeal, or (2)
a stay of enforcement thereof is not in effect, or (b) enforcement proceedings
are commenced upon such judgment, order, or award;

8.4If an Insolvency Proceeding is commenced by a Loan Party;

8.5If an Insolvency Proceeding is commenced against a Loan Party or any of its
Subsidiaries and any of the following events occur: (a) such Loan Party or such
Subsidiary consents to the institution of such Insolvency Proceeding against it,
(b) the petition commencing the Insolvency Proceeding is not timely
controverted, (c) the petition commencing the Insolvency Proceeding is not
dismissed within 60 calendar days of the date of the filing thereof, (d) an
interim trustee is appointed to take possession of all or any substantial
portion of the properties or assets of, or to operate all or any substantial
portion of the business of, such Loan Party or its Subsidiary, or (e) an order
for relief shall have been issued or entered therein;

8.6If a Loan Party or any of its Subsidiaries is enjoined, restrained, or in any
way prevented by court order from continuing to conduct all or any material part
of the business affairs of Borrower and its Subsidiaries, taken as a whole;

8.7If there is (a) a default in one or more agreements to which a Loan Party or
any of its Subsidiaries is a party with one or more third Persons relative to a
Loan Party's or any of its Subsidiaries' Indebtedness involving an aggregate
amount of $1,000,000 or more, and such default (i) occurs at the final maturity
of the obligations thereunder, or (ii) results in a right by

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such third Person, irrespective of whether exercised, to accelerate the maturity
of such Loan Party's or its Subsidiary's obligations thereunder, (b) a default
in or an involuntary early termination of one or more Hedge Agreements to which
a Loan Party or any of its Subsidiaries is a party, or (c) an “Event of Default”
as defined under the Indenture;

8.8If any warranty, representation, certificate, statement, or Record made
herein or in any other Loan Document or delivered in writing to Agent or any
Lender in connection with this Agreement or any other Loan Document proves to be
untrue in any material respect (except that such materiality qualifier shall not
be applicable to any representations and warranties that already are qualified
or modified by materiality in the text thereof) as of the date of issuance or
making or deemed making thereof;

8.9If the obligation of any Guarantor under the Guaranty is limited or
terminated by operation of law or by such Guarantor (other than in accordance
with the terms of this Agreement);

8.10If the Security Agreement or any other Loan Document that purports to create
a Lien, shall, for any reason, fail or cease to create a valid and perfected
and, except to the extent of Permitted Liens which are permitted purchase money
Liens or the interests of lessors under Capital Leases, first priority Lien on
the Collateral covered thereby, except (a) as a result of a disposition of the
applicable Collateral in a transaction permitted under this Agreement, or (b) as
the result of an action or failure to act on the part of Agent; or

8.11The validity or enforceability of any Loan Document shall at any time for
any reason (other than solely as the result of an action or failure to act on
the part of Agent) be declared to be null and void, or a proceeding shall be
commenced by a Loan Party or its Subsidiaries, or by any Governmental Authority
having jurisdiction over a Loan Party or its Subsidiaries, seeking to establish
the invalidity or unenforceability thereof, or a Loan Party or its Subsidiaries
shall deny that such Loan Party or its Subsidiaries has any liability or
obligation purported to be created under any Loan Document.

9.
RIGHTS AND REMEDIES.

9.1Rights and Remedies. Upon the occurrence and during the continuation of an
Event of Default, Agent may, and, at the instruction of the Required Lenders,
shall (in each case under clauses (a) or (b) by written notice to Borrower), in
addition to any other rights or remedies provided for hereunder or under any
other Loan Document or by applicable law, do any one or more of the following:

(a)declare the Obligations (other than the Bank Product Obligations), whether
evidenced by this Agreement or by any of the other Loan Documents immediately
due and payable, whereupon the same shall become and be immediately due and
payable and Borrower shall be obligated to repay all of such Obligations in
full, without presentment, demand, protest, or further notice or other
requirements of any kind, all of which are hereby expressly waived by Borrower;

(b)declare the Commitments terminated, whereupon the Commitments shall
immediately be terminated together with (i) any obligation of any Lender
hereunder to make Advances, (ii) the obligation of the Swing Lender to make
Swing Loans, and (iii) the obligation of the Issuing Lender to issue Letters of
Credit; and

(c)exercise all other rights and remedies available to Agent or the Lenders
under the Loan Documents or applicable law.

The foregoing to the contrary notwithstanding, upon the occurrence of any Event
of Default described in Section 8.4 or Section 8.5, in addition to the remedies
set forth above, without any notice to Borrower or any other Person or any act
by the Lender Group, the Commitments shall automatically terminate and the
Obligations (other than the Bank Product Obligations), inclusive of all accrued
and unpaid interest thereon and all fees and all other amounts owing under this
Agreement or under any of the other Loan Documents, shall automatically and
immediately become due and payable and Borrower shall be obligated to repay all
of such Obligations in full, without presentment, demand, protest, or notice of
any kind, all of which are expressly waived by Borrower.
9.2Remedies Cumulative. The rights and remedies of the Lender Group under this
Agreement, the other Loan Documents, and all other agreements shall be
cumulative. The Lender Group shall have all other rights and remedies not
inconsistent herewith as provided under the Code, by law, or in equity. No
exercise by the Lender Group of one right or remedy shall be deemed an election,
and no waiver by the Lender Group of any Event of Default shall be deemed a
continuing waiver. No delay by the Lender Group shall constitute a waiver,
election, or acquiescence by it.

10.WAIVERS; INDEMNIFICATION.

10.1Demand; Protest; etc. Borrower waives demand, protest, notice of protest,
notice of default or dishonor, notice

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of payment and nonpayment, nonpayment at maturity, release, compromise,
settlement, extension, or renewal of documents, instruments, chattel paper, and
guarantees at any time held by the Lender Group on which Borrower may in any way
be liable.

10.2The Lender Group's Liability for Collateral. Borrower hereby agrees that:
(a) so long as Agent complies with its obligations, if any, under the Code, the
Lender Group shall not in any way or manner be liable or responsible for: (i)
the safekeeping of the Collateral, (ii) any loss or damage thereto occurring or
arising in any manner or fashion from any cause, (iii) any diminution in the
value thereof, or (iv) any act or default of any carrier, warehouseman, bailee,
forwarding agency, or other Person, and (b) all risk of loss, damage, or
destruction of the Collateral shall be borne by Borrower.

10.3Indemnification. Borrower shall pay, indemnify, defend, and hold the
Agent-Related Persons, the Lender-Related Persons, and each Participant (each,
an “Indemnified Person”) harmless (to the fullest extent permitted by law) from
and against any and all claims, demands, suits, actions, investigations,
proceedings, liabilities, fines, costs, penalties, and damages, and all
reasonable fees and disbursements of attorneys, experts, or consultants and all
other costs and expenses actually incurred in connection therewith or in
connection with the enforcement of this indemnification (as and when they are
incurred and irrespective of whether suit is brought), at any time asserted
against, imposed upon, or incurred by any of them (a) in connection with or as a
result of or related to the execution and delivery (provided that Borrower shall
not be liable for costs and expenses (including attorneys fees) of any Lender
(other than WFCF) incurred in advising, structuring, drafting, reviewing,
administering or syndicating the Loan Documents), enforcement, performance, or
administration (including any restructuring or workout with respect hereto) of
this Agreement, any of the other Loan Documents, or the transactions
contemplated hereby or thereby or the monitoring of Borrower's and its
Subsidiaries' compliance with the terms of the Loan Documents (provided,
however, that the indemnification in this clause (a) shall not extend to (i)
disputes solely between or among the Lenders, (ii) disputes solely between or
among the Lenders and their respective Affiliates; it being understood and
agreed that the indemnification in this clause (a) shall extend to Agent (but
not the Lenders) relative to disputes between or among Agent on the one hand,
and one or more Lenders, or one or more of their Affiliates, on the other hand,
or (iii) any Taxes or any costs attributable to Taxes, which shall be governed
by Section 16), (b) with respect to any investigation, litigation, or proceeding
related to this Agreement, any other Loan Document, or the use of the proceeds
of the credit provided hereunder (irrespective of whether any Indemnified Person
is a party thereto), or any act, omission, event, or circumstance in any manner
related thereto, and (c) in connection with or arising out of any presence or
release of Hazardous Materials at, on, under, to or from any assets or
properties owned, leased or operated by Borrower or any of its Subsidiaries or
any Environmental Actions, Environmental Liabilities or Remedial Actions related
in any way to any such assets or properties of Borrower or any of its
Subsidiaries (each and all of the foregoing, the “Indemnified Liabilities”). The
foregoing to the contrary notwithstanding, Borrower shall have no obligation to
any Indemnified Person under this Section 10.3 with respect to any Indemnified
Liability that a court of competent jurisdiction finally determines to have
resulted from the gross negligence or willful misconduct of such Indemnified
Person or its officers, directors, employees, attorneys, or agents. This
provision shall survive the termination of this Agreement and the repayment of
the Obligations. If any Indemnified Person makes any payment to any other
Indemnified Person with respect to an Indemnified Liability as to which Borrower
was required to indemnify the Indemnified Person receiving such payment, the
Indemnified Person making such payment is entitled to be indemnified and
reimbursed by Borrower with respect thereto. WITHOUT LIMITATION, THE FOREGOING
INDEMNITY SHALL APPLY TO EACH INDEMNIFIED PERSON WITH RESPECT TO INDEMNIFIED
LIABILITIES WHICH IN WHOLE OR IN PART ARE CAUSED BY OR ARISE OUT OF ANY
NEGLIGENT ACT OR OMISSION OF SUCH INDEMNIFIED PERSON OR OF ANY OTHER PERSON.

11.
NOTICES.

Unless otherwise provided in this Agreement, all notices or demands relating to
this Agreement or any other Loan Document shall be in writing and (except for
financial statements and other informational documents which may be sent by
first-class mail, postage prepaid) shall be personally delivered or sent by
registered or certified mail (postage prepaid, return receipt requested),
overnight courier, electronic mail (at such email addresses as a party may
designate in accordance herewith), or telefacsimile. In the case of notices or
demands to Borrower or Agent, as the case may be, they shall be sent to the
respective address set forth below:

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If to Borrower:
THQ INC.
 
29903 Agoura Road
 
Agoura Hills, CA 91301
 
Attn: Paul Pucino, Executive Vice President and Chief Financial Officer
 
Fax No. 818-871-8755
 
Attn: Edward L. Kaufman, Executive Vice President of Business and Legal Affairs
 
Fax No. (818) 871-8755
 
 
If to Agent:
WELLS FARGO CAPITAL FINANCE, LLC
 
2450 Colorado Avenue, Suite 3000 West
 
Santa Monica, CA 90404
 
Attn: Business Finance Division Manager
 
Fax No.: (310) 453-7413
 
 
with copies to:
BUCHALTER NEMER
 
1000 Wilshire Boulevard, Suite 1500
 
Los Angeles, CA 90017
 
Attn: Robert J. Davidson, Esq.
 
Fax No.: (213) 891-0700
 
 

Any party hereto may change the address at which they are to receive notices
hereunder, by notice in writing in the foregoing manner given to the other
party. All notices or demands sent in accordance with this Section 11, shall be
deemed received on the earlier of the date of actual receipt or 3 Business Days
after the deposit thereof in the mail; provided, that (a) notices sent by
overnight courier service shall be deemed to have been given when received, (b)
notices by facsimile shall be deemed to have been given when sent (except that,
if not given during normal business hours for the recipient, shall be deemed to
have been given at the opening of business on the next Business Day for the
recipient) and (c) notices by electronic mail shall be deemed received upon the
sender's receipt of an acknowledgment from the intended recipient (such as by
the “return receipt requested” function, as available, return email or other
written acknowledgment).
12.
CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER.

(a)THE VALIDITY OF THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS (UNLESS EXPRESSLY
PROVIDED TO THE CONTRARY IN ANOTHER LOAN DOCUMENT IN RESPECT OF SUCH OTHER LOAN
DOCUMENT), THE CONSTRUCTION, INTERPRETATION, AND ENFORCEMENT HEREOF AND THEREOF,
AND THE RIGHTS OF THE PARTIES HERETO AND THERETO WITH RESPECT TO ALL MATTERS
ARISING HEREUNDER OR THEREUNDER OR RELATED HERETO OR THERETO SHALL BE DETERMINED
UNDER, GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
CALIFORNIA.

(b)THE PARTIES AGREE THAT ALL ACTIONS OR PROCEEDINGS ARISING IN CONNECTION WITH
THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS SHALL BE TRIED AND LITIGATED ONLY IN
THE STATE AND, TO THE EXTENT PERMITTED BY APPLICABLE LAW, FEDERAL COURTS LOCATED
IN THE COUNTY OF LOS ANGELES, STATE OF CALIFORNIA; PROVIDED, HOWEVER, THAT ANY
SUIT SEEKING ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY BE
BROUGHT, AT AGENT'S OPTION, IN THE COURTS OF ANY JURISDICTION WHERE AGENT ELECTS
TO BRING SUCH ACTION OR WHERE SUCH COLLATERAL OR OTHER PROPERTY MAY BE FOUND.
BORROWER AND EACH MEMBER OF THE LENDER GROUP WAIVE, TO THE EXTENT PERMITTED
UNDER APPLICABLE LAW,

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ANY RIGHT EACH MAY HAVE TO ASSERT THE DOCTRINE OF FORUM NON CONVENIENS OR TO
OBJECT TO VENUE TO THE EXTENT ANY PROCEEDING IS BROUGHT IN ACCORDANCE WITH THIS
SECTION 12(b).

(c)TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, BORROWER AND EACH MEMBER
OF THE LENDER GROUP HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY
CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF ANY OF THE LOAN DOCUMENTS
OR ANY OF THE TRANSACTIONS CONTEMPLATED THEREIN, INCLUDING CONTRACT CLAIMS, TORT
CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR STATUTORY CLAIMS.
BORROWER AND EACH MEMBER OF THE LENDER GROUP REPRESENT THAT EACH HAS REVIEWED
THIS WAIVER AND EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS
FOLLOWING CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT OF LITIGATION, A COPY OF
THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.

(d)BORROWER HEREBY IRREVOCABLY AND UNCONDITIONALLY SUBMITS TO THE EXCLUSIVE
JURISDICTION OF THE STATE AND FEDERAL COURTS LOCATED IN THE COUNTY OF LOS
ANGELES AND THE STATE OF CALIFORNIA, IN ANY ACTION OR PROCEEDING ARISING OUT OF
OR RELATING TO ANY LOAN DOCUMENTS, OR FOR RECOGNITION OR ENFORCEMENT OF ANY
JUDGMENT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH
ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER
JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW.
NOTHING IN THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT
AGENT MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT AGAINST ANY LOAN PARTY OR ITS PROPERTIES IN
THE COURTS OF ANY JURISDICTION.

13.ASSIGNMENTS AND PARTICIPATIONS; SUCCESSORS.

13.1Assignments and Participations.

(a)With the prior written consent of Borrower, which consent of Borrower shall
not be unreasonably withheld, delayed or conditioned, and shall not be required
(1) if an Event of Default has occurred and is continuing, or (2) in connection
with an assignment to a Person that is a Lender or an Affiliate (other than
individuals) of a Lender; provided that Borrower shall be deemed to have
consented to a proposed assignment unless it objects thereto by written notice
to Agent within 5 Business Days after having received notice thereof, and with
the prior written consent of Agent, which consent of Agent shall not be
unreasonably withheld, delayed or conditioned, and shall not be required in
connection with an assignment to a Person that is a Lender or an Affiliate
(other than individuals) of a Lender, any Lender may assign and delegate to one
or more assignees so long as such prospective assignee is an Eligible Transferee
(each, an “Assignee”; provided, however, that no Loan Party, Affiliate of a Loan
Party, Equity Sponsor, or Affiliate of Equity Sponsor shall be permitted to
become an Assignee) all or any portion of the Obligations, the Commitments and
the other rights and obligations of such Lender hereunder and under the other
Loan Documents, in a minimum amount (unless waived by Agent) of $5,000,000
(except such minimum amount shall not apply to (x) an assignment or delegation
by any Lender to any other Lender or an Affiliate of any Lender or (y) a group
of new Lenders, each of which is an Affiliate of each other or a Related Fund of
such new Lender to the extent that the aggregate amount to be assigned to all
such new Lenders is at least $5,000,000); provided, however, that Borrower and
Agent may continue to deal solely and directly with such Lender in connection
with the interest so assigned to an Assignee until (i) written notice of such
assignment, together with payment instructions, addresses, and related
information with respect to the Assignee, have been given to Borrower and Agent
by such Lender and the Assignee, (ii) such Lender and its Assignee have
delivered to Borrower and Agent an Assignment and Acceptance and Agent has
notified the assigning Lender of its receipt thereof in accordance with Section
13.1(b), and (iii) unless waived by Agent, the assigning Lender or Assignee has
paid to Agent for Agent's separate account a processing fee in the amount of
$3,500.

(b)From and after the date that Agent notifies the assigning Lender (with a copy
to Borrower) that it has received an executed Assignment and Acceptance and, if
applicable, payment of the required processing fee, (i) the Assignee thereunder
shall be a party hereto and, to the extent that rights and obligations hereunder
have been assigned to it pursuant to such Assignment and Acceptance, shall be a
“Lender” and shall have the rights and obligations of a Lender under the Loan
Documents, and (ii) the assigning Lender shall, to the extent that rights and
obligations hereunder and under the other Loan Documents have been assigned by
it pursuant to such Assignment and Acceptance, relinquish its rights (except
with respect to Section 10.3) and be released from any future obligations under
this Agreement (and in the case of an Assignment and Acceptance covering all or
the remaining portion of an assigning Lender's rights and obligations under this
Agreement and the other Loan Documents, such Lender shall cease to be a party
hereto and thereto); provided, however, that nothing contained herein shall
release any assigning Lender from obligations that survive the termination of
this Agreement, including such assigning Lender's obligations under

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Section 15 and Section 17.9(a).

(c)By executing and delivering an Assignment and Acceptance, the assigning
Lender thereunder and the Assignee thereunder confirm to and agree with each
other and the other parties hereto as follows: (i) other than as provided in
such Assignment and Acceptance, such assigning Lender makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with this Agreement or
the execution, legality, validity, enforceability, genuineness, sufficiency or
value of this Agreement or any other Loan Document furnished pursuant hereto,
(ii) such assigning Lender makes no representation or warranty and assumes no
responsibility with respect to the financial condition of Borrower or the
performance or observance by Borrower of any of its obligations under this
Agreement or any other Loan Document furnished pursuant hereto, (iii) such
Assignee confirms that it has received a copy of this Agreement, together with
such other documents and information as it has deemed appropriate to make its
own credit analysis and decision to enter into such Assignment and Acceptance,
(iv) such Assignee will, independently and without reliance upon Agent, such
assigning Lender or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under this Agreement, (v) such
Assignee appoints and authorizes Agent to take such actions and to exercise such
powers under this Agreement and the other Loan Documents as are delegated to
Agent, by the terms hereof and thereof, together with such powers as are
reasonably incidental thereto, and (vi) such Assignee agrees that it will
perform all of the obligations which by the terms of this Agreement are required
to be performed by it as a Lender.

(d)Immediately upon Agent's receipt of the required processing fee, if
applicable, and delivery of notice to the assigning Lender pursuant to Section
13.1(b), this Agreement shall be deemed to be amended to the extent, but only to
the extent, necessary to reflect the addition of the Assignee and the resulting
adjustment of the Commitments arising therefrom. The Commitment allocated to
each Assignee shall reduce such Commitments of the assigning Lender pro tanto.

(e)Any Lender may at any time sell to one or more commercial banks, financial
institutions, or other Persons (a “Participant”) participating interests in all
or any portion of its Obligations, its Commitment, and the other rights and
interests of that Lender (the “Originating Lender”) hereunder and under the
other Loan Documents; provided, however, that (i) the Originating Lender shall
remain a “Lender” for all purposes of this Agreement and the other Loan
Documents and the Participant receiving the participating interest in the
Obligations, the Commitments, and the other rights and interests of the
Originating Lender hereunder shall not constitute a “Lender” hereunder or under
the other Loan Documents and the Originating Lender's obligations under this
Agreement shall remain unchanged, (ii) the Originating Lender shall remain
solely responsible for the performance of such obligations, (iii) Borrower,
Agent, and the Lenders shall continue to deal solely and directly with the
Originating Lender in connection with the Originating Lender's rights and
obligations under this Agreement and the other Loan Documents, (iv) no Lender
shall transfer or grant any participating interest under which the Participant
has the right to approve any amendment to, or any consent or waiver with respect
to, this Agreement or any other Loan Document, except to the extent such
amendment to, or consent or waiver with respect to this Agreement or of any
other Loan Document would (A) extend the final maturity date of the Obligations
hereunder in which such Participant is participating, (B) reduce the interest
rate applicable to the Obligations hereunder in which such Participant is
participating, (C) release all or substantially all of the Collateral or
guaranties (except to the extent expressly provided herein or in any of the Loan
Documents) supporting the Obligations hereunder in which such Participant is
participating, (D) postpone the payment of, or reduce the amount of, the
interest or fees payable to such Participant through such Lender (other than a
waiver of default interest), or (E) decreases the amount or postpones the due
dates of scheduled principal repayments or prepayments or premiums payable to
such Participant through such Lender, and (v) all amounts payable by Borrower
hereunder shall be determined as if such Lender had not sold such participation,
except that, if amounts outstanding under this Agreement are due and unpaid, or
shall have been declared or shall have become due and payable upon the
occurrence of an Event of Default, each Participant shall be deemed to have the
right of set off in respect of its participating interest in amounts owing under
this Agreement to the same extent as if the amount of its participating interest
were owing directly to it as a Lender under this Agreement. The rights of any
Participant only shall be derivative through the Originating Lender with whom
such Participant participates and no Participant shall have any rights under
this Agreement or the other Loan Documents or any direct rights as to the other
Lenders, Agent, Borrower, the Collections of Borrower or its Subsidiaries, the
Collateral, or otherwise in respect of the Obligations. No Participant shall
have the right to participate directly in the making of decisions by the Lenders
among themselves.

(f)In connection with any such assignment or participation or proposed
assignment or participation or any grant of a security interest in, or pledge
of, its rights under and interest in this Agreement, a Lender may, subject to
the provisions of Section 17.9, disclose all documents and information which it
now or hereafter may have relating to Borrower and its Subsidiaries and their
respective businesses.

(g)Any other provision in this Agreement notwithstanding, any Lender may at any
time create a security interest in, or pledge, all or any portion of its rights
under and interest in this Agreement in favor of any Federal Reserve Bank in
accordance with Regulation A of the Federal Reserve Bank or U.S. Treasury
Regulation 31 CFR §203.24, and such Federal Reserve

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Bank may enforce such pledge or security interest in any manner permitted under
applicable law.

(h)Reserved

(i)In the event that a Lender sells participations in the Registered Loan, such
Lender, as a non-fiduciary agent on behalf of Borrower, shall maintain (or cause
to be maintained) a register on which it enters the name of all participants in
the Registered Loans held by it (and the principal amount (and stated interest
thereon) of the portion of such Registered Loans that is subject to such
participations) (the “Participant Register”). A Registered Loan (and the
registered note, if any, evidencing the same) may be participated in whole or in
part only by registration of such participation on the Participant Register (and
each registered note shall expressly so provide). Any participation of such
Registered Loan (and the registered note, if any, evidencing the same) may be
effected only by the registration of such participation on the Participant
Register.

(j)Agent shall make a copy of the Register (and each Lender shall make a copy of
its Participant Register in the extent it has one) available for review by
Borrower from time to time as Borrower may reasonably request.

(i)Upon consummation of an assignment, the assigning Lender, Agent and Borrower
shall make appropriate arrangements for issuance of replacement and/or new
Revolver Notes, as applicable.

13.2Successors. This Agreement shall bind and inure to the benefit of the
respective successors and assigns of each of the parties; provided, however,
that Borrower may not assign this Agreement or any rights or duties hereunder
without the Lenders' prior written consent and any prohibited assignment shall
be absolutely void ab initio. No consent to assignment by the Lenders shall
release Borrower from its Obligations. A Lender may assign this Agreement and
the other Loan Documents and its rights and duties hereunder and thereunder
pursuant to Section 13.1 and, except as expressly required pursuant to Section
13.1, no consent or approval by Borrower is required in connection with any such
assignment.

14.AMENDMENTS; WAIVERS.

14.1Amendments and Waivers.

(a)No amendment, waiver or other modification of any provision of this Agreement
or any other Loan Document (other than Bank Product Agreements or the Fee
Letter), and no consent with respect to any departure by Borrower therefrom,
shall be effective unless the same shall be in writing and signed by the
Required Lenders (or by Agent at the written request of the Required Lenders)
and the Loan Parties that are party thereto and then any such waiver or consent
shall be effective, but only in the specific instance and for the specific
purpose for which given; provided, however, that no such waiver, amendment, or
consent shall, unless in writing and signed by all of the Lenders directly
affected thereby and all of the Loan Parties that are party thereto, do any of
the following:

(i)increase the amount of or extend the expiration date of any Commitment of any
Lender or amend, modify, or eliminate the last sentence of Section 2.4(c),

(ii)postpone or delay any date fixed by this Agreement or any other Loan
Document for any payment of principal, interest, fees, or other amounts due
hereunder or under any other Loan Document,

(iii)reduce the principal of, or the rate of interest on, any loan or other
extension of credit hereunder, or reduce any fees or other amounts payable
hereunder or under any other Loan Document (except (y) in connection with the
waiver of applicability of Section 2.6(c) (which waiver shall be effective with
the written consent of the Required Lenders),

(iv)amend, modify, or eliminate this Section or any provision of this Agreement
providing for consent or other action by all Lenders,

(v)amend, modify, or eliminate Section 15.11,

(vi)other than as permitted by Section 15.11, release Agent's Lien in and to any
of the Collateral,

(vii)amend, modify, or eliminate the definition of “EBITDA”, “Excess
Availability”, “Required Lenders” or “Pro Rata Share”,

(viii)contractually subordinate any of Agent's Liens,

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(ix)other than in connection with a merger, liquidation, dissolution or sale of
such Person expressly permitted by the terms hereof or the other Loan Documents,
release Borrower or any Guarantor from any obligation for the payment of money
or consent to the assignment or transfer by Borrower or any Guarantor of any of
its rights or duties under this Agreement or the other Loan Documents,

(x)amend, modify, or eliminate any of the provisions of Section 2.4(b)(i) or
(ii) or Section 2.4(e) or (f),

(xi)amend, modify, or eliminate any of the provisions of Section 13.1(a) to
permit a Loan Party, an Affiliate of a Loan Party, Equity Sponsor, or an
Affiliate of Equity Sponsor to be permitted to become an Assignee, or

(xii)amend, modify, or eliminate the definition of Borrowing Base or any of the
defined terms (including the definitions of Eligible Accounts, Eligible
Inventory, and Eligible Titles) that are used in such definition to the extent
that any such change results in more credit being made available to Borrower
based upon the Borrowing Base, but not otherwise, or the definitions of Maximum
Revolver Amount, or change Section 2.1(c).

(b)No amendment, waiver, modification, elimination, or consent shall amend,
modify, or waive (i) the definition of, or any of the terms or provisions of,
the Fee Letter, without the written consent of Agent and Borrower (and shall not
require the written consent of any of the Lenders), and (ii) any provision of
Section 15 pertaining to Agent, or any other rights or duties of Agent under
this Agreement or the other Loan Documents, without the written consent of
Agent, Borrower, and the Required Lenders,

(c)No amendment, waiver, modification, elimination, or consent shall amend,
modify, or waive any provision of this Agreement or the other Loan Documents
pertaining to Issuing Lender, or any other rights or duties of Issuing Lender
under this Agreement or the other Loan Documents, without the written consent of
Issuing Lender, Agent, Borrower, and the Required Lenders,

(d)No amendment, waiver, modification, elimination, or consent shall amend,
modify, or waive any provision of this Agreement or the other Loan Documents
pertaining to Swing Lender, or any other rights or duties of Swing Lender under
this Agreement or the other Loan Documents, without the written consent of Swing
Lender, Agent, Borrower, and the Required Lenders,

(e)Anything in this Section 14.1 to the contrary notwithstanding, (i) any
amendment, modification, elimination, waiver, consent, termination, or release
of, or with respect to, any provision of this Agreement or any other Loan
Document that relates only to the relationship of the Lender Group among
themselves, and that does not affect the rights or obligations of Borrower,
shall not require consent by or the agreement of any Loan Party, and (ii) any
amendment, waiver, modification, elimination, or consent of or with respect to
any provision of this Agreement or any other Loan Document may be entered into
without the consent of, or over the objection of, any Defaulting Lender.

14.2Replacement of Certain Lenders.

(a)If (i) any action to be taken by the Lender Group or Agent hereunder requires
the consent, authorization, or agreement of all Lenders or all Lenders affected
thereby and if such action has received the consent, authorization, or agreement
of the Required Lenders but not of all Lenders or all Lenders affected thereby,
or (ii) any Lender makes a claim for compensation under Section 16, then
Borrower or Agent, upon at least 5 Business Days prior irrevocable notice, may
permanently replace any Lender that failed to give its consent, authorization,
or agreement (a “Holdout Lender”) or any Lender that made a claim for
compensation (a “Tax Lender”) with one or more Replacement Lenders, and the
Holdout Lender or Tax Lender, as applicable, shall have no right to refuse to be
replaced hereunder. Such notice to replace the Holdout Lender or Tax Lender, as
applicable, shall specify an effective date for such replacement, which date
shall not be later than 15 Business Days after the date such notice is given.

(b)Prior to the effective date of such replacement, the Holdout Lender or Tax
Lender, as applicable, and each Replacement Lender shall execute and deliver an
Assignment and Acceptance, subject only to the Holdout Lender or Tax Lender, as
applicable, being repaid in full its share of the outstanding Obligations
(without any premium or penalty of any kind whatsoever, but including (i) all
interest, fees and other amounts that may be due in payable in respect thereof,
and (ii) an assumption of its Pro Rata Share of participations in the Letters of
Credit). If the Holdout Lender or Tax Lender, as applicable, shall refuse or
fail to execute and deliver any such Assignment and Acceptance prior to the
effective date of such replacement, Agent may, but shall not be required to,
execute and deliver such Assignment and Acceptance in the name or and on behalf
of the Holdout Lender or Tax Lender, as applicable, and irrespective of whether
Agent executes and delivers such Assignment and Acceptance, the Holdout

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Lender or Tax Lender, as applicable, shall be deemed to have executed and
delivered such Assignment and Acceptance. The replacement of any Holdout Lender
or Tax Lender, as applicable, shall be made in accordance with the terms of
Section 13.1. Until such time as one or more Replacement Lenders shall have
acquired all of the Obligations, the Commitments, and the other rights and
obligations of the Holdout Lender or Tax Lender, as applicable, hereunder and
under the other Loan Documents, the Holdout Lender or Tax Lender, as applicable,
shall remain obligated to make the Holdout Lender's or Tax Lender's, as
applicable, Pro Rata Share of Advances and to purchase a participation in each
Letter of Credit, in an amount equal to its Pro Rata Share of such Letters of
Credit.

14.3No Waivers; Cumulative Remedies. No failure by Agent or any Lender to
exercise any right, remedy, or option under this Agreement or any other Loan
Document, or delay by Agent or any Lender in exercising the same, will operate
as a waiver thereof. No waiver by Agent or any Lender will be effective unless
it is in writing, and then only to the extent specifically stated. No waiver by
Agent or any Lender on any occasion shall affect or diminish Agent's and each
Lender's rights thereafter to require strict performance by Borrower of any
provision of this Agreement. Agent's and each Lender's rights under this
Agreement and the other Loan Documents will be cumulative and not exclusive of
any other right or remedy that Agent or any Lender may have.

15.AGENT; THE LENDER GROUP.

15.1Appointment and Authorization of Agent. Each Lender hereby designates and
appoints WFCF as its agent under this Agreement and the other Loan Documents and
each Lender hereby irrevocably authorizes (and by entering into a Bank Product
Agreement, each Bank Product Provider shall be deemed to designate, appoint, and
authorize) Agent to execute and deliver each of the other Loan Documents on its
behalf and to take such other action on its behalf under the provisions of this
Agreement and each other Loan Document and to exercise such powers and perform
such duties as are expressly delegated to Agent by the terms of this Agreement
or any other Loan Document, together with such powers as are reasonably
incidental thereto. Agent agrees to act as agent for and on behalf of the
Lenders (and the Bank Product Providers) on the conditions contained in this
Section 15. Any provision to the contrary contained elsewhere in this Agreement
or in any other Loan Document notwithstanding, Agent shall not have any duties
or responsibilities, except those expressly set forth herein or in the other
Loan Documents, nor shall Agent have or be deemed to have any fiduciary
relationship with any Lender (or Bank Product Provider), and no implied
covenants, functions, responsibilities, duties, obligations or liabilities shall
be read into this Agreement or any other Loan Document or otherwise exist
against Agent. Without limiting the generality of the foregoing, the use of the
term “agent” in this Agreement or the other Loan Documents with reference to
Agent is not intended to connote any fiduciary or other implied (or express)
obligations arising under agency doctrine of any applicable law. Instead, such
term is used merely as a matter of market custom, and is intended to create or
reflect only a representative relationship between independent contracting
parties. Each Lender hereby further authorizes (and by entering into a Bank
Product Agreement, each Bank Product Provider shall be deemed to authorize)
Agent to act as the secured party under each of the Loan Documents that create a
Lien on any item of Collateral. Except as expressly otherwise provided in this
Agreement, Agent shall have and may use its sole discretion with respect to
exercising or refraining from exercising any discretionary rights or taking or
refraining from taking any actions that Agent expressly is entitled to take or
assert under or pursuant to this Agreement and the other Loan Documents. Without
limiting the generality of the foregoing, or of any other provision of the Loan
Documents that provides rights or powers to Agent, Lenders agree that Agent
shall have the right to exercise the following powers as long as this Agreement
remains in effect: (a) maintain, in accordance with its customary business
practices, ledgers and records reflecting the status of the Obligations, the
Collateral, the Collections of Borrower and its Subsidiaries, and related
matters, (b) execute or file any and all financing or similar statements or
notices, amendments, renewals, supplements, documents, instruments, proofs of
claim, notices and other written agreements with respect to the Loan Documents,
(c) make Advances, for itself or on behalf of Lenders, as provided in the Loan
Documents, (d) exclusively receive, apply, and distribute the Collections of
Borrower and its Subsidiaries as provided in the Loan Documents, (e) open and
maintain such bank accounts and cash management arrangements as Agent deems
necessary and appropriate in accordance with the Loan Documents for the
foregoing purposes with respect to the Collateral and the Collections of
Borrower and its Subsidiaries, (f) perform, exercise, and enforce any and all
other rights and remedies of the Lender Group with respect to Borrower or its
Subsidiaries, the Obligations, the Collateral, the Collections of Borrower and
its Subsidiaries, or otherwise related to any of same as provided in the Loan
Documents, and (g) incur and pay such Lender Group Expenses as Agent may deem
necessary or appropriate for the performance and fulfillment of its functions
and powers pursuant to the Loan Documents.

15.2Delegation of Duties. Agent may execute any of its duties under this
Agreement or any other Loan Document by or through agents, employees or
attorneys in fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. Agent shall not be responsible for the
negligence or misconduct of any agent or attorney in fact that it selects as
long as such selection was made without gross negligence or willful misconduct.

15.3Liability of Agent. None of the Agent-Related Persons shall (a) be liable
for any action taken or omitted to be taken by any of them under or in
connection with this Agreement or any other Loan Document or the transactions
contemplated

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hereby (except for its own gross negligence or willful misconduct), or (b) be
responsible in any manner to any of the Lenders (or Bank Product Providers) for
any recital, statement, representation or warranty made by Borrower or any of
its Subsidiaries or Affiliates, or any officer or director thereof, contained in
this Agreement or in any other Loan Document, or in any certificate, report,
statement or other document referred to or provided for in, or received by Agent
under or in connection with, this Agreement or any other Loan Document, or the
validity, effectiveness, genuineness, enforceability or sufficiency of this
Agreement or any other Loan Document, or for any failure of Borrower or its
Subsidiaries or any other party to any Loan Document to perform its obligations
hereunder or thereunder. No Agent-Related Person shall be under any obligation
to any Lenders (or Bank Product Providers) to ascertain or to inquire as to the
observance or performance of any of the agreements contained in, or conditions
of, this Agreement or any other Loan Document, or to inspect the books and
records or properties of Borrower or its Subsidiaries.

15.4Reliance by Agent. Agent shall be entitled to rely, and shall be fully
protected in relying, upon any writing, resolution, notice, consent,
certificate, affidavit, letter, telegram, telefacsimile or other electronic
method of transmission, telex or telephone message, statement or other document
or conversation believed by it to be genuine and correct and to have been
signed, sent, or made by the proper Person or Persons, and upon advice and
statements of legal counsel (including counsel to Borrower or counsel to any
Lender), independent accountants and other experts selected by Agent. Agent
shall be fully justified in failing or refusing to take any action under this
Agreement or any other Loan Document unless Agent shall first receive such
advice or concurrence of the Lenders as it deems appropriate and until such
instructions are received, Agent shall act, or refrain from acting, as it deems
advisable. If Agent so requests, it shall first be indemnified to its reasonable
satisfaction by the Lenders (and, if it so elects, the Bank Product Providers)
against any and all liability and expense that may be incurred by it by reason
of taking or continuing to take any such action. Agent shall in all cases be
fully protected in acting, or in refraining from acting, under this Agreement or
any other Loan Document in accordance with a request or consent of the Required
Lenders and such request and any action taken or failure to act pursuant thereto
shall be binding upon all of the Lenders (and Bank Product Providers).

15.5Notice of Default or Event of Default. Agent shall not be deemed to have
knowledge or notice of the occurrence of any Default or Event of Default, except
with respect to defaults in the payment of principal, interest, fees, and
expenses required to be paid to Agent for the account of the Lenders and, except
with respect to Events of Default of which Agent has actual knowledge, unless
Agent shall have received written notice from a Lender or Borrower referring to
this Agreement, describing such Default or Event of Default, and stating that
such notice is a “notice of default.” Agent promptly will notify the Lenders of
its receipt of any such notice or of any Event of Default of which Agent has
actual knowledge. If any Lender obtains actual knowledge of any Event of
Default, such Lender promptly shall notify the other Lenders and Agent of such
Event of Default. Each Lender shall be solely responsible for giving any notices
to its Participants, if any. Subject to Section 15.4, Agent shall take such
action with respect to such Default or Event of Default as may be requested by
the Required Lenders in accordance with Section 9; provided, however, that
unless and until Agent has received any such request, Agent may (but shall not
be obligated to) take such action, or refrain from taking such action, with
respect to such Default or Event of Default as it shall deem advisable.

15.6Credit Decision. Each Lender (and Bank Product Provider) acknowledges that
none of the Agent-Related Persons has made any representation or warranty to it,
and that no act by Agent hereinafter taken, including any review of the affairs
of Borrower and its Subsidiaries or Affiliates, shall be deemed to constitute
any representation or warranty by any Agent-Related Person to any Lender (or
Bank Product Provider). Each Lender represents (and by entering into a Bank
Product Agreement, each Bank Product Provider shall be deemed to represent) to
Agent that it has, independently and without reliance upon any Agent-Related
Person and based on such due diligence, documents and information as it has
deemed appropriate, made its own appraisal of and investigation into the
business, prospects, operations, property, financial and other condition and
creditworthiness of Borrower or any other Person party to a Loan Document, and
all applicable bank regulatory laws relating to the transactions contemplated
hereby, and made its own decision to enter into this Agreement and to extend
credit to Borrower. Each Lender also represents (and by entering into a Bank
Product Agreement, each Bank Product Provider shall be deemed to represent) that
it will, independently and without reliance upon any Agent-Related Person and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit analysis, appraisals and decisions in
taking or not taking action under this Agreement and the other Loan Documents,
and to make such investigations as it deems necessary to inform itself as to the
business, prospects, operations, property, financial and other condition and
creditworthiness of Borrower or any other Person party to a Loan Document.
Except for notices, reports, and other documents expressly herein required to be
furnished to the Lenders by Agent, Agent shall not have any duty or
responsibility to provide any Lender (or Bank Product Provider) with any credit
or other information concerning the business, prospects, operations, property,
financial and other condition or creditworthiness of Borrower or any other
Person party to a Loan Document that may come into the possession of any of the
Agent-Related Persons. Each Lender acknowledges (and by entering into a Bank
Product Agreement, each Bank Product Provider shall be deemed to acknowledge)
that Agent does not have any duty or responsibility, either initially or on a
continuing basis (except to the extent, if any, that is expressly specified
herein) to provide such Lender (or Bank Product Provider) with any credit or
other information with respect to Borrower, its Affiliates or any of their
respective business, legal, financial or other affairs, and irrespective of
whether such information came into Agent's or its Affiliates' or
representatives' possession before or after the date on which such Lender became
a party to this Agreement (or such Bank Product Provider entered into a Bank
Product Agreement).

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15.7Costs and Expenses; Indemnification. Agent may incur and pay Lender Group
Expenses to the extent Agent reasonably deems necessary or appropriate for the
performance and fulfillment of its functions, powers, and obligations pursuant
to the Loan Documents, including court costs, attorneys fees and expenses, fees
and expenses of financial accountants, advisors, consultants, and appraisers,
costs of collection by outside collection agencies, auctioneer fees and
expenses, and costs of security guards or insurance premiums paid to maintain
the Collateral, whether or not Borrower is obligated to reimburse Agent or
Lenders for such expenses pursuant to this Agreement or otherwise. Agent is
authorized and directed to deduct and retain sufficient amounts from the
Collections of Borrower and its Subsidiaries received by Agent to reimburse
Agent for such out-of-pocket costs and expenses prior to the distribution of any
amounts to Lenders (or Bank Product Providers). In the event Agent is not
reimbursed for such costs and expenses by Borrower or its Subsidiaries, each
Lender hereby agrees that it is and shall be obligated to pay to Agent such
Lender's ratable thereof. Whether or not the transactions contemplated hereby
are consummated, each of the Lenders, on a ratable basis, shall indemnify and
defend the Agent-Related Persons (to the extent not reimbursed by or on behalf
of Borrower and without limiting the obligation of Borrower to do so) from and
against any and all Indemnified Liabilities; provided, however, that no Lender
shall be liable for the payment to any Agent-Related Person of any portion of
such Indemnified Liabilities resulting solely from such Person's gross
negligence or willful misconduct nor shall any Lender be liable for the
obligations of any Defaulting Lender in failing to make an Advance or other
extension of credit hereunder. Without limitation of the foregoing, each Lender
shall reimburse Agent upon demand for such Lender's ratable share of any costs
or out of pocket expenses (including attorneys, accountants, advisors, and
consultants fees and expenses) incurred by Agent in connection with the
preparation, execution, delivery, administration, modification, amendment, or
enforcement (whether through negotiations, legal proceedings or otherwise) of,
or legal advice in respect of rights or responsibilities under, this Agreement
or any other Loan Document to the extent that Agent is not reimbursed for such
expenses by or on behalf of Borrower. The undertaking in this Section shall
survive the payment of all Obligations hereunder and the resignation or
replacement of Agent.

15.8Agent in Individual Capacity. WFCF and its Affiliates may make loans to,
issue letters of credit for the account of, accept deposits from, provide Bank
Products to, acquire equity interests in, and generally engage in any kind of
banking, trust, financial advisory, underwriting, or other business with
Borrower and its Subsidiaries and Affiliates and any other Person party to any
Loan Document as though WFCF were not Agent hereunder, and, in each case,
without notice to or consent of the other members of the Lender Group. The other
members of the Lender Group acknowledge (and by entering into a Bank Product
Agreement, each Bank Product Provider shall be deemed to acknowledge) that,
pursuant to such activities, WFCF or its Affiliates may receive information
regarding Borrower or its Affiliates or any other Person party to any Loan
Documents that is subject to confidentiality obligations in favor of Borrower or
such other Person and that prohibit the disclosure of such information to the
Lenders (or Bank Product Providers), and the Lenders acknowledge (and by
entering into a Bank Product Agreement, each Bank Product Provider shall be
deemed to acknowledge) that, in such circumstances (and in the absence of a
waiver of such confidentiality obligations, which waiver Agent will use its
reasonable best efforts to obtain), Agent shall not be under any obligation to
provide such information to them. The terms “Lender” and “Lenders” include WFCF
in its individual capacity.

15.9Successor Agent. Agent may resign as Agent upon 30 days prior written notice
to the Lenders (unless such notice is waived by the Required Lenders) and
Borrower (unless such notice is waived by Borrower) and without any notice to
the Bank Product Providers. If Agent resigns under this Agreement, the Required
Lenders shall be entitled, with (so long as no Event of Default has occurred and
is continuing) the consent of Borrower (such consent not to be unreasonably
withheld, delayed, or conditioned), appoint a successor Agent for the Lenders
(and the Bank Product Providers). If, at the time that Agent's resignation is
effective, it is acting as the Issuing Lender or the Swing Lender, such
resignation shall also operate to effectuate its resignation as the Issuing
Lender or the Swing Lender, as applicable, and it shall automatically be
relieved of any further obligation to issue Letters of Credit, to cause the
Underlying Issuer to issue Letters of Credit, or to make Swing Loans. If no
successor Agent is appointed prior to the effective date of the resignation of
Agent, Agent may appoint, after consulting with the Lenders and Borrower, a
successor Agent. If Agent has materially breached or failed to perform any
material provision of this Agreement or of applicable law, the Required Lenders
may agree in writing to remove and replace Agent with a successor Agent from
among the Lenders with (so long as no Event of Default has occurred and is
continuing) the consent of Borrower (such consent not to be unreasonably
withheld, delayed, or conditioned). In any such event, upon the acceptance of
its appointment as successor Agent hereunder, such successor Agent shall succeed
to all the rights, powers, and duties of the retiring Agent and the term “Agent”
shall mean such successor Agent and the retiring Agent's appointment, powers,
and duties as Agent shall be terminated. After any retiring Agent's resignation
hereunder as Agent, the provisions of this Section 15 shall inure to its benefit
as to any actions taken or omitted to be taken by it while it was Agent under
this Agreement. If no successor Agent has accepted appointment as Agent by the
date which is 30 days following a retiring Agent's notice of resignation, the
retiring Agent's resignation shall nevertheless thereupon become effective and
the Lenders shall perform all of the duties of Agent hereunder until such time,
if any, as the Lenders appoint a successor Agent as provided for above.

15.10Lender in Individual Capacity. Any Lender and its respective Affiliates may
make loans to, issue letters of credit for the account of, accept deposits from,
provide Bank Products to, acquire equity interests in and generally engage in
any

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kind of banking, trust, financial advisory, underwriting, or other business with
Borrower and its Subsidiaries and Affiliates and any other Person party to any
Loan Documents as though such Lender were not a Lender hereunder without notice
to or consent of the other members of the Lender Group (or the Bank Product
Providers). The other members of the Lender Group acknowledge (and by entering
into a Bank Product Agreement, each Bank Product Provider shall be deemed to
acknowledge) that, pursuant to such activities, such Lender and its respective
Affiliates may receive information regarding Borrower or its Affiliates or any
other Person party to any Loan Documents that is subject to confidentiality
obligations in favor of Borrower or such other Person and that prohibit the
disclosure of such information to the Lenders, and the Lenders acknowledge (and
by entering into a Bank Product Agreement, each Bank Product Provider shall be
deemed to acknowledge) that, in such circumstances (and in the absence of a
waiver of such confidentiality obligations, which waiver such Lender will use
its reasonable best efforts to obtain), such Lender shall not be under any
obligation to provide such information to them.

15.11Collateral Matters.

(a)The Lenders hereby irrevocably authorize (and by entering into a Bank Product
Agreement, each Bank Product Provider shall be deemed to authorize) Agent to
release any Lien on any Collateral (i) upon the termination of the Commitments
and payment and satisfaction in full by Borrower of all of the Obligations, (ii)
constituting property being sold or disposed of if a release is required or
desirable in connection therewith and if Borrower certifies to Agent that the
sale or disposition is permitted under Section 6.4 (and Agent may rely
conclusively on any such certificate, without further inquiry), (iii)
constituting property in which Borrower or its Subsidiaries owned no interest at
the time Agent's Lien was granted nor at any time thereafter, or
(iv) constituting property leased to Borrower or its Subsidiaries under a lease
that has expired or is terminated in a transaction permitted under this
Agreement. The Loan Parties and the Lenders hereby irrevocably authorize (and by
entering into a Bank Product Agreement, each Bank Product Provider shall be
deemed to authorize) Agent, based upon the instruction of the Required Lenders,
to (a) consent to, credit bid or purchase (either directly or through one or
more acquisition vehicles) all or any portion of the Collateral at any sale
thereof conducted under the provisions of the Bankruptcy Code, including under
Section 363 of the Bankruptcy Code, (b) credit bid or purchase (either directly
or through one or more acquisition vehicles) all or any portion of the
Collateral at any sale or other disposition thereof conducted under the
provisions of the Code, including pursuant to Sections 9-610 or 9-620 of the
Code, or (c) credit bid or purchase (either directly or through one or more
acquisition vehicles) all or any portion of the Collateral at any other sale or
foreclosure conducted by Agent (whether by judicial action or otherwise) in
accordance with applicable law. In connection with any such credit bid or
purchase, the Obligations owed to the Lenders and the Bank Product Providers
shall be entitled to be, and shall be, credit bid on a ratable basis (with
Obligations with respect to contingent or unliquidated claims being estimated
for such purpose if the fixing or liquidation thereof would not unduly delay the
ability of Agent to credit bid or purchase at such sale or other disposition of
the Collateral and, if such claims cannot be estimated without unduly delaying
the ability of Agent to credit bid, then such claims shall be disregarded, not
credit bid, and not entitled to any interest in the asset or assets purchased by
means of such credit bid) and the Lenders and the Bank Product Providers whose
Obligations are credit bid shall be entitled to receive interests (ratably based
upon the proportion of their Obligations credit bid in relation to the aggregate
amount of Obligations so credit bid) in the asset or assets so purchased (or in
the Stock of the acquisition vehicle or vehicles that are used to consummate
such purchase). Except as provided above, Agent will not execute and deliver a
release of any Lien on any Collateral without the prior written authorization of
(y) if the release is of all or substantially all of the Collateral, all of the
Lenders (without requiring the authorization of the Bank Product Providers), or
(z) otherwise, the Required Lenders (without requiring the authorization of the
Bank Product Providers). Upon request by Agent or Borrower at any time, the
Lenders will (and if so requested, the Bank Product Providers will) confirm in
writing Agent's authority to release any such Liens on particular types or items
of Collateral pursuant to this Section 15.11; provided, however, that (1) Agent
shall not be required to execute any document necessary to evidence such release
on terms that, in Agent's opinion, would expose Agent to liability or create any
obligation or entail any consequence other than the release of such Lien without
recourse, representation, or warranty, and (2) such release shall not in any
manner discharge, affect, or impair the Obligations or any Liens (other than
those expressly being released) upon (or obligations of Borrower in respect of)
all interests retained by Borrower, including, the proceeds of any sale, all of
which shall continue to constitute part of the Collateral. The Lenders further
hereby irrevocably authorize (and by entering into a Bank Product Agreement,
each Bank Product Provider shall be deemed to authorize) Agent, at its option
and in its sole discretion, to subordinate any Lien granted to or held by Agent
under any Loan Document to the holder of any Permitted Lien on such property if
such Permitted Lien secures Permitted Purchase Money Indebtedness.

(b)Agent shall have no obligation whatsoever to any of the Lenders (or the Bank
Product Providers) to assure that the Collateral exists or is owned by Borrower
or its Subsidiaries or is cared for, protected, or insured or has been
encumbered, or that Agent's Liens have been properly or sufficiently or lawfully
created, perfected, protected, or enforced or are entitled to any particular
priority, or that any particular items of Collateral meet the eligibility
criteria applicable in respect thereof or whether to impose, maintain, reduce,
or eliminate any particular reserve hereunder or whether the amount of any such
reserve is appropriate or not, or to exercise at all or in any particular manner
or under any duty of care, disclosure or fidelity, or to continue exercising,
any of the rights, authorities and powers granted or available to Agent pursuant
to any of the Loan Documents, it being understood and agreed that in respect of
the Collateral, or any act, omission, or event related thereto, subject to the
terms and

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conditions contained herein, Agent may act in any manner it may deem
appropriate, in its sole discretion given Agent's own interest in the Collateral
in its capacity as one of the Lenders and that Agent shall have no other duty or
liability whatsoever to any Lender (or Bank Product Provider) as to any of the
foregoing, except as otherwise provided herein.

15.12Restrictions on Actions by Lenders; Sharing of Payments.

(a)Each of the Lenders agrees that it shall not, without the express written
consent of Agent, and that it shall, to the extent it is lawfully entitled to do
so, upon the written request of Agent, set off against the Obligations, any
amounts owing by such Lender to Borrower or its Subsidiaries or any deposit
accounts of Borrower or its Subsidiaries now or hereafter maintained with such
Lender. Each of the Lenders further agrees that it shall not, unless
specifically requested to do so in writing by Agent, take or cause to be taken
any action, including, the commencement of any legal or equitable proceedings to
enforce any Loan Document against Borrower or any Guarantor or to foreclose any
Lien on, or otherwise enforce any security interest in, any of the Collateral.

(b)If, at any time or times any Lender shall receive (i) by payment,
foreclosure, setoff, or otherwise, any proceeds of Collateral or any payments
with respect to the Obligations, except for any such proceeds or payments
received by such Lender from Agent pursuant to the terms of this Agreement, or
(ii) payments from Agent in excess of such Lender's Pro Rata Share of all such
distributions by Agent, such Lender promptly shall (A) turn the same over to
Agent, in kind, and with such endorsements as may be required to negotiate the
same to Agent, or in immediately available funds, as applicable, for the account
of all of the Lenders and for application to the Obligations in accordance with
the applicable provisions of this Agreement, or (B) purchase, without recourse
or warranty, an undivided interest and participation in the Obligations owed to
the other Lenders so that such excess payment received shall be applied ratably
as among the Lenders in accordance with their Pro Rata Shares; provided,
however, that to the extent that such excess payment received by the purchasing
party is thereafter recovered from it, those purchases of participations shall
be rescinded in whole or in part, as applicable, and the applicable portion of
the purchase price paid therefor shall be returned to such purchasing party, but
without interest except to the extent that such purchasing party is required to
pay interest in connection with the recovery of the excess payment.

15.13Agency for Perfection. Agent hereby appoints each other Lender (and each
Bank Product Provider) as its agent (and each Lender hereby accepts (and by
entering into a Bank Product Agreement, each Bank Product Provider shall be
deemed to accept) such appointment) for the purpose of perfecting Agent's Liens
in assets which, in accordance with Article 8 or Article 9, as applicable, of
the Code can be perfected by possession or control. Should any Lender obtain
possession or control of any such Collateral, such Lender shall notify Agent
thereof, and, promptly upon Agent's request therefor shall deliver possession or
control of such Collateral to Agent or in accordance with Agent's instructions.

15.14Payments by Agent to the Lenders. All payments to be made by Agent to the
Lenders (or Bank Product Providers) shall be made by bank wire transfer of
immediately available funds pursuant to such wire transfer instructions as each
party may designate for itself by written notice to Agent. Concurrently with
each such payment, Agent shall identify whether such payment (or any portion
thereof) represents principal, premium, fees, or interest of the Obligations.

15.15Concerning the Collateral and Related Loan Documents. Each member of the
Lender Group authorizes and directs Agent to enter into this Agreement and the
other Loan Documents. Each member of the Lender Group agrees (and by entering
into a Bank Product Agreement, each Bank Product Provider shall be deemed to
agree) that any action taken by Agent in accordance with the terms of this
Agreement or the other Loan Documents relating to the Collateral and the
exercise by Agent of its powers set forth therein or herein, together with such
other powers that are reasonably incidental thereto, shall be binding upon all
of the Lenders (and such Bank Product Provider).

15.16Audits and Examination Reports; Confidentiality; Disclaimers by Lenders;
Other Reports and Information. By becoming a party to this Agreement, each
Lender:

(a)is deemed to have requested that Agent furnish such Lender, promptly after it
becomes available, a copy of each field audit or examination report respecting
Borrower or its Subsidiaries (each, a “Report”) prepared by or at the request of
Agent, and Agent shall so furnish each Lender with such Reports,

(b)expressly agrees and acknowledges that Agent does not (i) make any
representation or warranty as to the accuracy of any Report, and (ii) shall not
be liable for any information contained in any Report,

(c)expressly agrees and acknowledges that the Reports are not comprehensive
audits or examinations, that Agent or other party performing any audit or
examination will inspect only specific information regarding Borrower and its
Subsidiaries and will rely significantly upon Borrower's and its Subsidiaries'
books and records, as well as on representations of

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Borrower's personnel,

(d)agrees to keep all Reports and other material, non-public information
regarding Borrower and its Subsidiaries and their operations, assets, and
existing and contemplated business plans in a confidential manner in accordance
with Section 17.9, and

(e)without limiting the generality of any other indemnification provision
contained in this Agreement, agrees: (i) to hold Agent and any other Lender
preparing a Report harmless from any action the indemnifying Lender may take or
fail to take or any conclusion the indemnifying Lender may reach or draw from
any Report in connection with any loans or other credit accommodations that the
indemnifying Lender has made or may make to Borrower, or the indemnifying
Lender's participation in, or the indemnifying Lender's purchase of, a loan or
loans of Borrower, and (ii) to pay and protect, and indemnify, defend and hold
Agent, and any such other Lender preparing a Report harmless from and against,
the claims, actions, proceedings, damages, costs, expenses, and other amounts
(including, attorneys fees and costs) incurred by Agent and any such other
Lender preparing a Report as the direct or indirect result of any third parties
who might obtain all or part of any Report through the indemnifying Lender.

In addition to the foregoing: (x) any Lender may from time to time request of
Agent in writing that Agent provide to such Lender a copy of any report or
document provided by Borrower or its Subsidiaries to Agent that has not been
contemporaneously provided by Borrower or such Subsidiary to such Lender, and,
upon receipt of such request, Agent promptly shall provide a copy of same to
such Lender, (y) to the extent that Agent is entitled, under any provision of
the Loan Documents, to request additional reports or information from Borrower
or its Subsidiaries, any Lender may, from time to time, reasonably request Agent
to exercise such right as specified in such Lender's notice to Agent, whereupon
Agent promptly shall request of Borrower the additional reports or information
reasonably specified by such Lender, and, upon receipt thereof from Borrower or
such Subsidiary, Agent promptly shall provide a copy of same to such Lender, and
(z) any time that Agent renders to Borrower a statement regarding the Loan
Account, Agent shall send a copy of such statement to each Lender.
15.17Several Obligations; No Liability. Notwithstanding that certain of the Loan
Documents now or hereafter may have been or will be executed only by or in favor
of Agent in its capacity as such, and not by or in favor of the Lenders, any and
all obligations on the part of Agent (if any) to make any credit available
hereunder shall constitute the several (and not joint) obligations of the
respective Lenders on a ratable basis, according to their respective
Commitments, to make an amount of such credit not to exceed, in principal
amount, at any one time outstanding, the amount of their respective Commitments.
Nothing contained herein shall confer upon any Lender any interest in, or
subject any Lender to any liability for, or in respect of, the business, assets,
profits, losses, or liabilities of any other Lender. Each Lender shall be solely
responsible for notifying its Participants of any matters relating to the Loan
Documents to the extent any such notice may be required, and no Lender shall
have any obligation, duty, or liability to any Participant of any other Lender.
Except as provided in Section 15.7, no member of the Lender Group shall have any
liability for the acts of any other member of the Lender Group. No Lender shall
be responsible to Borrower or any other Person for any failure by any other
Lender (or Bank Product Provider) to fulfill its obligations to make credit
available hereunder, nor to advance for such Lender (or Bank Product Provider)
or on its behalf, nor to take any other action on behalf of such Lender (or Bank
Product Provider) hereunder or in connection with the financing contemplated
herein.

16.
WITHHOLDING TAXES.

(a)All payments made by Borrower hereunder or under any note or other Loan
Document will be made without setoff, counterclaim, or other defense. In
addition, all such payments will be made free and clear of, and without
deduction or withholding for, any present or future Taxes, and in the event any
deduction or withholding of Taxes is required, Borrower shall comply with the
next sentence of this Section 16(a). If any Taxes are so levied or imposed,
Borrower agrees to pay the full amount of such Taxes and such additional amounts
as may be necessary so that every payment of all amounts due under this
Agreement, any note, or Loan Document, including any amount paid pursuant to
this Section 16(a) after withholding or deduction for or on account of any
Taxes, will not be less than the amount provided for herein; provided, however,
that Borrower shall not be required to increase any such amounts if the increase
in such amount payable results from Agent's or such Lender's own willful
misconduct or gross negligence (as finally determined by a court of competent
jurisdiction). Borrower will furnish to Agent as promptly as possible after the
date the payment of any Tax is due pursuant to applicable law, certified copies
of tax receipts evidencing such payment by Borrower.

(b)Borrower agrees to pay any present or future stamp, value added or
documentary taxes or any other excise or property taxes, charges, or similar
levies that arise from any payment made hereunder or from the execution,
delivery, performance, recordation, or filing of, or otherwise with respect to
this Agreement or any other Loan Document.

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(c)If a Lender or Participant is entitled to claim an exemption or reduction
from United States withholding tax, such Lender or Participant agrees with and
in favor of Agent, to deliver to Agent (or, in the case of a Participant, to the
Lender granting the participation only) one of the following before receiving
its first payment under this Agreement:

(i)if such Lender or Participant is entitled to claim an exemption from United
States withholding tax pursuant to the portfolio interest exception, (A) a
statement of the Lender or Participant, signed under penalty of perjury, that it
is not a (I) a “bank” as described in Section 881(c)(3)(A) of the IRC, (II) a
10% shareholder of Borrower (within the meaning of Section 871(h)(3)(B) of the
IRC), or (III) a controlled foreign corporation related to Borrower within the
meaning of Section 864(d)(4) of the IRC, and (B) a properly completed and
executed IRS Form W-8BEN or Form W-8IMY (with proper attachments);

(ii)if such Lender or Participant is entitled to claim an exemption from, or a
reduction of, withholding tax under a United States tax treaty, a properly
completed and executed copy of IRS Form W-8BEN;

(iii)if such Lender or Participant is entitled to claim that interest paid under
this Agreement is exempt from United States withholding tax because it is
effectively connected with a United States trade or business of such Lender, a
properly completed and executed copy of IRS Form W-8ECI;

(iv)if such Lender or Participant is entitled to claim that interest paid under
this Agreement is exempt from United States withholding tax because such Lender
or Participant serves as an intermediary, a properly completed and executed copy
of IRS Form W-8IMY (with proper attachments); or

(v)a properly completed and executed copy of any other form or forms, including
IRS Form W-9, as may be required under the IRC or other laws of the United
States as a condition to exemption from, or reduction of, United States
withholding or backup withholding tax.

Each Lender or Participant shall provide new forms (or successor forms) upon the
expiration or obsolescence of any previously delivered forms and to promptly
notify Agent (or, in the case of a Participant, to the Lender granting the
participation only) of any change in circumstances which would modify or render
invalid any claimed exemption or reduction.
(d)If a Lender or Participant claims an exemption from withholding tax in a
jurisdiction other than the United States, such Lender or such Participant
agrees with and in favor of Agent, to deliver to Agent (or, in the case of a
Participant, to the Lender granting the participation only) any such form or
forms, as may be required under the laws of such jurisdiction as a condition to
exemption from, or reduction of, foreign withholding or backup withholding tax
before receiving its first payment under this Agreement, but only if such Lender
or such Participant is legally able to deliver such forms, provided, however,
that nothing in this Section 16(d) shall require a Lender or Participant to
disclose any information that it deems to be confidential (including without
limitation, its tax returns). Each Lender and each Participant shall provide new
forms (or successor forms) upon the expiration or obsolescence of any previously
delivered forms and to promptly notify Agent (or, in the case of a Participant,
to the Lender granting the participation only) of any change in circumstances
which would modify or render invalid any claimed exemption or reduction.

(e)If a Lender or Participant claims exemption from, or reduction of,
withholding tax and such Lender or Participant sells, assigns, grants a
participation in, or otherwise transfers all or part of the Obligations of
Borrower to such Lender or Participant, such Lender or Participant agrees to
notify Agent (or, in the case of a sale of a participation interest, to the
Lender granting the participation only) of the percentage amount in which it is
no longer the beneficial owner of Obligations of Borrower to such Lender or
Participant. To the extent of such percentage amount, Agent will treat such
Lender's or such Participant's documentation provided pursuant to Section 16(c)
or 16(d) as no longer valid. With respect to such percentage amount, such
Participant or Assignee may provide new documentation, pursuant to Section 16(c)
or 16(d), if applicable. Borrower agrees that each Participant shall be entitled
to the benefits of this Section 16 with respect to its participation in any
portion of the Commitments and the Obligations so long as such Participant
complies with the obligations set forth in this Section 16 with respect thereto.

(f)If a Lender or a Participant is entitled to a reduction in the applicable
withholding tax, Agent (or, in the case of a Participant, to the Lender granting
the participation) may withhold from any interest payment to such Lender or such
Participant an amount equivalent to the applicable withholding tax after taking
into account such reduction. If the forms or other documentation required by
Section 16(c) or 16(d) are not delivered to Agent (or, in the case of a
Participant, to the Lender granting the participation), then Agent (or, in the
case of a Participant, to the Lender granting the participation) may withhold
from any interest payment to such Lender or such Participant not providing such
forms or other documentation an amount equivalent to the applicable withholding
tax.

(g)If the IRS or any other Governmental Authority of the United States or other
jurisdiction asserts a claim

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that Agent (or, in the case of a Participant, to the Lender granting the
participation) did not properly withhold tax from amounts paid to or for the
account of any Lender or any Participant due to a failure on the part of the
Lender or any Participant (because the appropriate form was not delivered, was
not properly executed, or because such Lender failed to notify Agent (or such
Participant failed to notify the Lender granting the participation) of a change
in circumstances which rendered the exemption from, or reduction of, withholding
tax ineffective, or for any other reason) such Lender shall indemnify and hold
Agent harmless (or, in the case of a Participant, such Participant shall
indemnify and hold the Lender granting the participation harmless) for all
amounts paid, directly or indirectly, by Agent (or, in the case of a
Participant, to the Lender granting the participation), as tax or otherwise,
including penalties and interest, and including any taxes imposed by any
jurisdiction on the amounts payable to Agent (or, in the case of a Participant,
to the Lender granting the participation only) under this Section 16, together
with all costs and expenses (including attorneys fees and expenses). The
obligation of the Lenders and the Participants under this subsection shall
survive the payment of all Obligations and the resignation or replacement of
Agent.

(h)If Agent or a Lender determines, in its sole discretion, that it has received
a refund of any Taxes as to which it has been indemnified by Borrower or with
respect to which Borrower has paid additional amounts pursuant to this Section
16, so long as no Default or Event of Default has occurred and is continuing, it
shall pay over such refund to Borrower (but only to the extent of payments made,
or additional amounts paid, by Borrower under this Section 16 with respect to
Taxes giving rise to such a refund), net of all out-of-pocket expenses of Agent
or such Lender and without interest (other than any interest paid by the
relevant Governmental Authority with respect to such a refund); provided, that
Borrower, upon the request of Agent or such Lender, agrees to repay the amount
paid over to Borrower (plus any penalties, interest or other charges, imposed by
the relevant Governmental Authority, other than such penalties, interest or
other charges imposed as a result of the willful misconduct or gross negligence
of Agent hereunder) to Agent or such Lender in the event Agent or such Lender is
required to repay such refund to such Governmental Authority. Notwithstanding
anything in this Agreement to the contrary, this Section 16 shall not be
construed to require Agent or any Lender to make available its tax returns (or
any other information which it deems confidential) to Borrower or any other
Person.

17.GENERAL PROVISIONS.

17.1Effectiveness. This Agreement shall be binding and deemed effective when
executed by Borrower, Agent, and each Lender whose signature is provided for on
the signature pages hereof.

17.2Section Headings. Headings and numbers have been set forth herein for
convenience only. Unless the contrary is compelled by the context, everything
contained in each Section applies equally to this entire Agreement.

17.3Interpretation. Neither this Agreement nor any uncertainty or ambiguity
herein shall be construed against the Lender Group or Borrower, whether under
any rule of construction or otherwise. On the contrary, this Agreement has been
reviewed by all parties and shall be construed and interpreted according to the
ordinary meaning of the words used so as to accomplish fairly the purposes and
intentions of all parties hereto.

17.4Severability of Provisions. Each provision of this Agreement shall be
severable from every other provision of this Agreement for the purpose of
determining the legal enforceability of any specific provision.

17.5Bank Product Providers. Each Bank Product Provider shall be deemed a third
party beneficiary hereof and of the provisions of the other Loan Documents for
purposes of any reference in a Loan Document to the parties for whom Agent is
acting. Agent hereby agrees to act as agent for such Bank Product Providers and,
by virtue of entering into a Bank Product Agreement, the applicable Bank Product
Provider shall be automatically deemed to have appointed Agent as its agent and
to have accepted the benefits of the Loan Documents; it being understood and
agreed that the rights and benefits of each Bank Product Provider under the Loan
Documents consist exclusively of such Bank Product Provider's being a
beneficiary of the Liens and security interests (and, if applicable, guarantees)
granted to Agent and the right to share in payments and collections out of the
Collateral as more fully set forth herein. In addition, each Bank Product
Provider, by virtue of entering into a Bank Product Agreement, shall be
automatically deemed to have agreed that Agent shall have the right, but shall
have no obligation, to establish, maintain, relax, or release reserves in
respect of the Bank Product Obligations and that if reserves are established
there is no obligation on the part of Agent to determine or insure whether the
amount of any such reserve is appropriate or not. In connection with any such
distribution of payments or proceeds of Collateral, Agent shall be entitled to
assume no amounts are due or owing to any Bank Product Provider unless such Bank
Product Provider has provided a written certification (setting forth a
reasonably detailed calculation) to Agent as to the amounts that are due and
owing to it and such written certification is received by Agent a reasonable
period of time prior to the making of such distribution. Agent shall have no
obligation to calculate the amount due and payable with respect to any Bank
Products, but may rely upon the written certification of the amount due and
payable from the relevant Bank Product Provider. In the absence of an updated
certification, Agent shall be entitled to assume that the amount due and payable
to the relevant Bank Product Provider is the amount last certified to Agent by
such Bank Product Provider as

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being due and payable (less any distributions made to such Bank Product Provider
on account thereof). Borrower may obtain Bank Products from any Bank Product
Provider, although Borrower is not required to do so. Borrower acknowledges and
agrees that no Bank Product Provider has committed to provide any Bank Products
and that the providing of Bank Products by any Bank Product Provider is in the
sole and absolute discretion of such Bank Product Provider. Notwithstanding
anything to the contrary in this Agreement or any other Loan Document, no
provider or holder of any Bank Product shall have any voting or approval rights
hereunder (or be deemed a Lender) solely by virtue of its status as the provider
or holder of such agreements or products or the Obligations owing thereunder,
nor shall the consent of any such provider or holder be required (other than in
their capacities as Lenders, to the extent applicable) for any matter hereunder
or under any of the other Loan Documents, including as to any matter relating to
the Collateral or the release of Collateral or Guarantors.

17.6Debtor-Creditor Relationship. The relationship between the Lenders and
Agent, on the one hand, and the Loan Parties, on the other hand, is solely that
of creditor and debtor. No member of the Lender Group has (or shall be deemed to
have) any fiduciary relationship or duty to any Loan Party arising out of or in
connection with the Loan Documents or the transactions contemplated thereby, and
there is no agency or joint venture relationship between the members of the
Lender Group, on the one hand, and the Loan Parties, on the other hand, by
virtue of any Loan Document or any transaction contemplated therein.

17.7Counterparts; Electronic Execution. This Agreement may be executed in any
number of counterparts and by different parties on separate counterparts, each
of which, when executed and delivered, shall be deemed to be an original, and
all of which, when taken together, shall constitute but one and the same
Agreement. Delivery of an executed counterpart of this Agreement by
telefacsimile or other electronic method of transmission shall be equally as
effective as delivery of an original executed counterpart of this Agreement. Any
party delivering an executed counterpart of this Agreement by telefacsimile or
other electronic method of transmission also shall deliver an original executed
counterpart of this Agreement but the failure to deliver an original executed
counterpart shall not affect the validity, enforceability, and binding effect of
this Agreement. The foregoing shall apply to each other Loan Document mutatis
mutandis.

17.8Revival and Reinstatement of Obligations. If the incurrence or payment of
the Obligations by Borrower or Guarantor or the transfer to the Lender Group of
any property should for any reason subsequently be asserted, or declared, to be
void or voidable under any state or federal law relating to creditors' rights,
including provisions of the Bankruptcy Code relating to fraudulent conveyances,
preferences, or other voidable or recoverable payments of money or transfers of
property (each, a “Voidable Transfer”), and if the Lender Group is required to
repay or restore, in whole or in part, any such Voidable Transfer, or elects to
do so upon the advice of counsel, then, as to any such Voidable Transfer, or the
amount thereof that the Lender Group is required or elects to repay or restore,
and as to all reasonable costs, expenses, and attorneys fees of the Lender Group
related thereto, the liability of Borrower or Guarantor automatically shall be
revived, reinstated, and restored and shall exist as though such Voidable
Transfer had never been made.

17.9Confidentiality.

(a)Agent and Lenders each individually (and not jointly or jointly and
severally) agree that material, non-public information regarding Borrower and
its Subsidiaries, their operations, assets, and existing and contemplated
business plans (“Confidential Information”) shall be treated by Agent and the
Lenders in a confidential manner, and shall not be disclosed by Agent and the
Lenders to Persons who are not parties to this Agreement, except: (i) to
attorneys for and other advisors, accountants, auditors, and consultants to any
member of the Lender Group and to employees, directors and officers of any
member of the Lender Group (the Persons in this clause (i), “Lender Group
Representatives”) on a “need to know” basis in connection with this Agreement
and the transactions contemplated hereby and on a confidential basis, (ii) to
Subsidiaries and Affiliates of any member of the Lender Group (including the
Bank Product Providers), provided that any such Subsidiary or Affiliate shall
have agreed to receive such information hereunder subject to the terms of this
Section 17.9, (iii) as may be required by regulatory authorities so long as such
authorities are informed of the confidential nature of such information, (iv) as
may be required by statute, decision, or judicial or administrative order, rule,
or regulation; provided that (x) prior to any disclosure under this clause (iv),
the disclosing party agrees to provide Borrower with prior notice thereof, to
the extent that it is practicable to do so and to the extent that the disclosing
party is permitted to provide such prior notice to Borrower pursuant to the
terms of the applicable statute, decision, or judicial or administrative order,
rule, or regulation and (y) any disclosure under this clause (iv) shall be
limited to the portion of the Confidential Information as may be required by
such statute, decision, or judicial or administrative order, rule, or
regulation, (v) as may be agreed to in advance in writing by Borrower, (vi) as
requested or required by any Governmental Authority pursuant to any subpoena or
other legal process, provided, that, (x) prior to any disclosure under this
clause (vi) the disclosing party agrees to provide Borrower with prior written
notice thereof, to the extent that it is practicable to do so and to the extent
that the disclosing party is permitted to provide such prior written notice to
Borrower pursuant to the terms of the subpoena or other legal process and (y)
any disclosure under this clause (vi) shall be limited to the portion of the
Confidential Information as may be required by such Governmental Authority
pursuant to such subpoena or other legal process, (vii) as to any such
information that is or becomes generally available to the public (other than as
a result of prohibited disclosure by Agent or the Lenders or the Lender Group

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Representatives), (viii) in connection with any assignment, participation or
pledge of any Lender's interest under this Agreement, provided that prior to
receipt of Confidential Information any such assignee, participant, or pledgee
shall have agreed in writing to receive such Confidential Information hereunder
subject to the terms of this Section, (ix) in connection with any litigation or
other adversary proceeding involving parties hereto which such litigation or
adversary proceeding involves claims related to the rights or duties of such
parties under this Agreement or the other Loan Documents; provided, that, prior
to any disclosure to any Person (other than any Loan Party, Agent, any Lender,
any of their respective Affiliates, or their respective counsel) under this
clause (ix) with respect to litigation involving any Person (other than
Borrower, Agent, any Lender, any of their respective Affiliates, or their
respective counsel), the disclosing party agrees to provide Borrower with prior
written notice thereof, and (x) in connection with, and to the extent reasonably
necessary for, the exercise of any secured creditor remedy under this Agreement
or under any other Loan Document.

(b)Anything in this Agreement to the contrary notwithstanding, Agent may (i)
provide customary information concerning the terms and conditions of this
Agreement and the other Loan Documents to loan syndication and pricing reporting
services, and (ii) use the name, logos, and other insignia of Borrower and the
Loan Parties and the Total Commitments provided hereunder in any “tombstone” or
comparable advertising, on its website or in other marketing materials of Agent.

17.10Lender Group Expenses. Borrower agrees to pay the Lender Group Expenses on
the earlier of (a) the first day of the month following the date on which such
Lender Group Expenses were first incurred or (b) the date on which demand
therefor is made by Agent. Borrower agrees that its obligations contained in
this Section 17.10 shall survive payment or satisfaction in full of all other
Obligations.

17.11Survival. All representations and warranties made by the Loan Parties in
the Loan Documents and in the certificates or other instru-ments delivered in
connection with or pursuant to this Agreement or any other Loan Document shall
be considered to have been relied upon by the other parties hereto and shall
survive the execution and delivery of the Loan Documents and the making of any
loans and issuance of any Letters of Credit, regardless of any investigation
made by any such other party or on its behalf and notwithstanding that Agent,
the Issuing Lender, or any Lender may have had notice or knowledge of any
Default or Event of Default or incorrect representation or warranty at the time
any credit is extended hereunder, and shall continue in full force and effect as
long as the principal of or any accrued interest on any loan or any fee or any
other amount payable under this Agreement is outstand-ing and unpaid or any
Letter of Credit is outstanding and so long as the Commitments have not expired
or terminated.

17.12Patriot Act. Each Lender that is subject to the requirements of the Patriot
Act hereby notifies Borrower that pursuant to the requirements of the Act, it is
required to obtain, verify and record information that identifies Borrower,
which information includes the name and address of Borrower and other
information that will allow such Lender to identify Borrower in accordance with
the Patriot Act. In addition, if Agent is required by law or regulation or
internal policies to do so, it shall have the right to periodically conduct (a)
Patriot Act searches, OFAC/PEP searches, and customary individual background
checks for the Loan Parties and (b) OFAC/PEP searches and customary individual
background checks for the Loan Parties' senior management and key principals,
and Borrower agrees to cooperate in respect of the conduct of such searches and
further agrees that the reasonable costs and charges for such searches shall
constitute Lender Expenses hereunder and be for the account of Borrower.

17.13Integration. This Agreement, together with the other Loan Documents,
reflects the entire understanding of the parties with respect to the
transactions contemplated hereby and shall not be contradicted or qualified by
any other agreement, oral or written, before the date hereof. The foregoing to
the contrary notwithstanding, all Bank Product Agreements, if any, are
independent agreements governed by the written provisions of such Bank Product
Agreements, which will remain in full force and effect, unaffected by any
repayment, prepayments, acceleration, reduction, increase, or change in the
terms of any credit extended hereunder, except as otherwise expressly provided
in such Bank Product Agreement.

[Signature pages to follow.]

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

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
and delivered as of the date first above written.
 
THQ INC.,
a Delaware corporation
 
 
 
 
 
By:
/s/ Paul J. Pucino
 
Name:
Paul J. Pucino
 
Title:
EVP and CFO
 
 

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

 
WELLS FARGO CAPITAL FINANCE, LLC,
a Delaware limited liability company, as Agent and as a Lender
 
 
 
By:
/s/ Justin Button
 
Name:
Justin Button
 
Title:
Vice President
 
 

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Schedule 1.1
As used in the Agreement, the following terms shall have the following
definitions:
“Account” means an account (as that term is defined in the Code).
“Account Debtor” means any Person who is obligated on an Account, chattel paper,
or a general intangible.
“Accounting Changes” means changes in accounting principles required by the
promulgation of any rule, regulation, pronouncement or opinion by the Financial
Accounting Standards Board of the American Institute of Certified Public
Accountants (or successor thereto or any agency with similar functions).
“Acquired Indebtedness” means Indebtedness of a Person whose assets or Stock is
acquired by Borrower or a Loan Party in a Permitted Acquisition; provided,
however, that such Indebtedness (a) is either Purchase Money Indebtedness or a
Capital Lease with respect to Equipment or mortgage financing with respect to
Real Property, (b) was in existence prior to the date of such Permitted
Acquisition, and (c) was not incurred in connection with, or in contemplation
of, such Permitted Acquisition.
“Acquisition” means (a) the purchase or other acquisition by a Person or its
Subsidiaries of all or substantially all of the assets of (or any division or
business line of) any other Person, or (b) the purchase or other acquisition
(whether by means of a merger, consolidation, or otherwise) by a Person or its
Subsidiaries of all or substantially all of the Stock of any other Person.
“Additional Documents” has the meaning specified therefor in Section 5.12 of the
Agreement.
“Advances” has the meaning specified therefor in Section 2.1(a) of the
Agreement.
“Affected Lender” has the meaning specified therefor in Section 2.13(b) of the
Agreement.
“Affiliate” means, as applied to any Person, any other Person who controls, is
controlled by, or is under common control with, such Person. For purposes of
this definition, “control” means the possession, directly or indirectly through
one or more intermediaries, of the power to direct the management and policies
of a Person, whether through the ownership of Stock, by contract, or otherwise;
provided, however, that, for purposes of the definition of Eligible Accounts and
Section 6.12 of the Agreement: (a) any Person which owns directly or indirectly
15% or more of the Stock having ordinary voting power for the election of
directors or other members of the governing body of a Person or 10% or more of
the partnership or other ownership interests of a Person (other than as a
limited partner of such Person) shall be deemed an Affiliate of such Person, (b)
each director (or comparable manager) of a Person shall be deemed to be an
Affiliate of such Person, and (c) each partnership in which a Person is a
general partner shall be deemed an Affiliate of such Person.
“Agent” has the meaning specified therefor in the preamble to the Agreement.
“Agent-Related Persons” means Agent, together with its Affiliates, officers,
directors, employees, attorneys, and agents.
“Agent's Account” means the Deposit Account of Agent identified on Schedule A-1.
“Agent's Liens” means the Liens granted by Borrower or its Subsidiaries to Agent
under the Loan Documents.
“Agreement” means the Credit Agreement to which this Schedule 1.1 is attached.
“Applicable Prepayment Premium” has the meaning set forth in Section 2.10(d) of
the Agreement.
“Application Event” means the occurrence of (a) a failure by Borrower to repay
all of the Obligations in full on the Maturity Date, or (b) an Event of Default
and the election by Agent or the Required Lenders to require that payments and
proceeds of Collateral be applied pursuant to Section 2.4(b)(ii) of the
Agreement.
“Assignee” has the meaning specified therefor in Section 13.1(a) of the
Agreement.
“Assignment and Acceptance” means an Assignment and Acceptance Agreement
substantially in the form of Exhibit A-1.

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“Authorized Person” means any one of the individuals identified on Schedule A-2,
as such schedule is updated from time to time by written notice from Borrower to
Agent.
“Availability” means, as of any date of determination, the amount that Borrower
is entitled to borrow as Advances under Section 2.1 of the Agreement (after
giving effect to all then outstanding Obligations (other than Bank Product
Obligations)).
“Bank Product” means any one or more of the following financial products or
accommodations extended to Borrower or its Subsidiaries by a Bank Product
Provider: (a) credit cards, (b) credit card processing services, (c) debit
cards, (d) stored value cards, (e) purchase cards (including so-called
“procurement cards” or “P-cards”), (f) Cash Management Services, or (g)
transactions under Hedge Agreements.
“Bank Product Agreements” means those agreements entered into from time to time
by Borrower or its Subsidiaries with a Bank Product Provider in connection with
the obtaining of any of the Bank Products.
“Bank Product Collateralization” means providing cash collateral (pursuant to
documentation reasonably satisfactory to Agent) to be held by Agent for the
benefit of the Bank Product Providers (other than the Hedge Providers) in an
amount determined by Agent as sufficient to satisfy the reasonably estimated
credit exposure with respect to the then existing Bank Product Obligations
(other than Hedge Obligations).
“Bank Product Obligations” means (a) all obligations, liabilities, reimbursement
obligations, fees, or expenses owing by Borrower or its Subsidiaries to any Bank
Product Provider pursuant to or evidenced by a Bank Product Agreement and
irrespective of whether for the payment of money, whether direct or indirect,
absolute or contingent, due or to become due, now existing or hereafter arising,
(b) all Hedge Obligations, and (c) all amounts that Agent or any Lender is
obligated to pay to a Bank Product Provider as a result of Agent or such Lender
purchasing participations from, or executing guarantees or indemnities or
reimbursement obligations to, a Bank Product Provider with respect to the Bank
Products provided by such Bank Product Provider to Borrower or its Subsidiaries;
provided, however, in order for any item described in clauses (a), (b), or (c)
above, as applicable, to constitute “Bank Product Obligations”, (i) if the
applicable Bank Product Provider is Wells Fargo or its Affiliates, then, if
requested by Agent, Agent shall have received a Bank Product Provider Letter
Agreement within 10 days after the date of such request, or (ii) if the
applicable Bank Product Provider is any other Person, the applicable Bank
Product must have been provided on or after the Closing Date and Agent shall
have received a Bank Product Provider Letter Agreement within 10 days after the
date of the provision of the applicable Bank Product to Borrower or its
Subsidiaries.
“Bank Product Provider” means any Lender or any of its Affiliates; provided,
however, that no such Person (other than Wells Fargo or its Affiliates) shall
constitute a Bank Product Provider with respect to a Bank Product unless and
until Agent shall have received a Bank Product Provider Letter Agreement from
such Person and with respect to the applicable Bank Product within 10 days after
the provision of such Bank Product to Borrower or its Subsidiaries; provided
further, however, that if, at any time, a Lender ceases to be a Lender under the
Agreement, then, from and after the date on which it ceases to be a Lender
thereunder, neither it nor any of its Affiliates shall constitute Bank Product
Providers and the obligations with respect to Bank Products provided by such
former Lender or any of its Affiliates shall no longer constitute Bank Product
Obligations.
“Bank Product Provider Letter Agreement” means a letter agreement in
substantially the form attached hereto as Exhibit B-2, in form and substance
satisfactory to Agent, duly executed by the applicable Bank Product Provider,
Borrower, and Agent.
“Bank Product Reserve Amount” means, as of any date of determination, the Dollar
amount of reserves that Agent has determined it is necessary or appropriate to
establish (based upon the Bank Product Providers' reasonable determination of
their credit exposure to Borrower and its Subsidiaries in respect of Bank
Product Obligations) in respect of Bank Products then provided or outstanding.
“Bankruptcy Code” means title 11 of the United States Code, as in effect from
time to time.
“Base Rate” means the greatest of (a) the Federal Funds Rate plus ½%, (b) the
LIBOR Rate (which rate shall be calculated based upon an Interest Period of 3
months and shall be determined on a daily basis), plus 1 percentage point, and
(c) the rate of interest announced, from time to time, within Wells Fargo at its
principal office in San Francisco as its “prime rate”, with the understanding
that the “prime rate” is one of Wells Fargo's base rates (not necessarily the
lowest of such rates) and serves as the basis upon which effective rates of
interest are calculated for those loans making reference thereto and is
evidenced by the recording thereof after its announcement in such internal
publications as Wells Fargo may designate.
“Base Rate Loan” means each portion of the Advances that bears interest at a
rate determined by reference to the Base Rate.

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“Base Rate Margin” means, as of any date of determination (with respect to any
portion of the outstanding Advances on such date that is a Base Rate Loan), the
applicable margin set forth in the following table that corresponds to the
Revolver Usage:
Level
Revolver Usage
Base Rate Margin
I
< $42,500,000
2.25%
II
> $42,500,000
2.5%

The Base Rate Margin shall be based upon the Revolver Usage calculated as of the
end of each fiscal quarter; provided, that the Base Rate Margin on the Closing
Date shall be based upon the Revolver Usage after giving effect to the initial
Advances and issuance of Letters of Credit. Except as set forth in the foregoing
proviso, the Base Rate Margin shall be re-determined quarterly on the first day
of the month following such date of determination.
“Benefit Plan” means a “defined benefit plan” (as defined in Section 3(35) of
ERISA) for which Borrower or any of its Subsidiaries or ERISA Affiliates has
been an “employer” (as defined in Section 3(5) of ERISA) within the past six
years.
“Board of Directors” means the board of directors (or comparable managers) of
Borrower.
“Borrower” has the meaning specified therefor in the preamble to the Agreement.
“Borrowing” means a borrowing consisting of Advances made on the same day by the
Lenders (or Agent on behalf thereof), or by Swing Lender in the case of a Swing
Loan, or by Agent in the case of a Protective Advance.
“Borrowing Base” means, as of any date of determination, the result of:
(a)    85% of the amount of Eligible Accounts, less the amount, if any, of the
Dilution Reserve, plus
(b)    the lesser of
(iii)    the Inventory Sublimit, and

(iv)    85% times the most recently determined Net Liquidation Percentage times
the value of Borrower's Eligible Inventory, plus

(c)    the lesser of
(v)    the IP Sublimit, and

(vi)    the IP Advance Rate times the value (as set forth on the most recent
appraisal prepared by an appraiser and in form and substance satisfactory to
Agent) of Eligible Titles, minus

(d)    the aggregate amount of reserves, if any, that are not duplicative of
reserves included in the amounts above and established by Agent under Section
2.1(c) of the Agreement.
“Borrowing Base Certificate” means a certificate in the form of Exhibit B-1.
“Borrowing Base Excess” has the meaning set forth in Section 2.4(e).
“Business Day” means any day that is not a Saturday, Sunday, or other day on
which banks are authorized or required to close in the state of California,
except that, if a determination of a Business Day shall relate to a LIBOR Rate
Loan, the term “Business Day” also shall exclude any day on which banks are
closed for dealings in Dollar deposits in the London interbank market.
“Capital Expenditures” means, with respect to any Person for any period, the
aggregate of all expenditures by such Person and its Subsidiaries during such
period that are capital expenditures as determined in accordance with GAAP,
whether such expenditures are paid in cash or financed.
“Capitalized Lease Obligation” means that portion of the obligations under a
Capital Lease that is required to be capitalized

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in accordance with GAAP.
“Capital Lease” means a lease that is required to be capitalized for financial
reporting purposes in accordance with GAAP.
“Cash Equivalents” means (a) marketable direct obligations issued by, or
unconditionally guaranteed by, the United States or issued by any agency thereof
and backed by the full faith and credit of the United States, in each case
maturing within 1 year from the date of acquisition thereof, (b) marketable
direct obligations issued or fully guaranteed by any state of the United States
or any political subdivision of any such state or any public instrumentality
thereof maturing within 1 year from the date of acquisition thereof and, at the
time of acquisition, having one of the two highest ratings obtainable from
either Standard & Poor's Rating Group (“S&P”) or Moody's Investors Service, Inc.
(“Moody's”), (c) commercial paper maturing no more than 270 days from the date
of creation thereof and, at the time of acquisition, having a rating of at least
A-1 from S&P or at least P-1 from Moody's, (d) certificates of deposit, time
deposits, overnight bank deposits or bankers' acceptances maturing within 1 year
from the date of acquisition thereof issued by any bank organized under the laws
of the United States or any state thereof or the District of Columbia or any
United States branch of a foreign bank having at the date of acquisition thereof
combined capital and surplus of not less than $250,000,000, (e) Deposit Accounts
maintained with (i) any bank that satisfies the criteria described in clause (d)
above, or (ii) any other bank organized under the laws of the United States or
any state thereof so long as the full amount maintained with any such other bank
is insured by the Federal Deposit Insurance Corporation, (f) repurchase
obligations of any commercial bank satisfying the requirements of clause (d) of
this definition or recognized securities dealer having combined capital and
surplus of not less than $250,000,000, having a term of not more than seven
days, with respect to securities satisfying the criteria in clauses (a) or (d)
above, (g) debt securities with maturities of six months or less from the date
of acquisition backed by standby letters of credit issued by any commercial bank
satisfying the criteria described in clause (d) above, and (h) Investments in
money market funds substantially all of whose assets are invested in the types
of assets described in clauses (a) through (g) above and (i) in the case of any
foreign Subsidiary that is not a Loan Party, (i) investments of the type and (to
the extent applicable) maturity described in clauses (a) through (g) above of
(or maintained with) a comparable foreign obligor, which investments or obligors
(or the parent thereof) have ratings or capital, as the case may be, described
in clauses (b), (c) or (d) above, or equivalent ratings from comparable foreign
rating agencies or (ii) investments of the type and maturity (to the extent
applicable) described in clauses (a) through (g) above of (or maintained with) a
foreign obligors (or the parent thereof), which investments or obligors (or the
parents thereof) are not rated as provided in such clauses or in subclause (i)
of this paragraph (i) but which are, in the reasonable judgment of Borrower,
comparable in investment quality to such investments and obligors (or the
parents of such obligors).
“Cash Management Services” means any cash management or related services
including treasury, depository, return items, overdraft, controlled
disbursement, merchant store value cards, e-payables services, electronic funds
transfer, interstate depository network, automatic clearing house transfer
(including the Automated Clearing House processing of electronic funds transfers
through the direct Federal Reserve Fedline system) and other cash management
arrangements.
“CFC” means a controlled foreign corporation (as that term is defined in the
IRC).
“Change of Control” means that (a) any “person” or “group” (within the meaning
of Sections 13(d) and 14(d) of the Exchange Act) becomes the beneficial owner
(as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of
35%, or more, of the Stock of Borrower having the right to vote for the election
of members of the Board of Directors, (b) Borrower fails to own and control,
directly or indirectly, 100% of the Stock of each other Loan Party, or (c) a
“Fundamental Change” as defined in the Indenture has occurred.
“Closing Date” means the date of the making of the initial Advance (or other
extension of credit) under the Agreement or the date on which Agent sends
Borrower a written notice that each of the conditions precedent set forth on
Schedule 3.1 either have been satisfied or have been waived.
“Code” means the California Uniform Commercial Code, as in effect from time to
time.
“Collateral” means all assets and interests in assets and proceeds thereof now
owned or hereafter acquired by Borrower or its Subsidiaries in or upon which a
Lien is granted by such Person in favor of Agent or the Lenders under any of the
Loan Documents.
“Collateral Access Agreement” means a landlord waiver, bailee letter, or
acknowledgement agreement of any lessor, warehouseman, processor, consignee, or
other Person in possession of, having a Lien upon, or having rights or interests
in Borrower's or its Subsidiaries' books and records, Equipment, or Inventory,
in each case, in form and substance reasonably satisfactory to Agent.
“Collections” means all cash, checks, notes, instruments, and other items of
payment (including insurance proceeds, cash

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

proceeds of asset sales, rental proceeds, and tax refunds).
“Commitment” means, with respect to each Lender, its Revolver Commitment or its
Total Commitment, as the context requires, and, with respect to all Lenders,
their Revolver Commitments, or their Total Commitments, as the context requires,
in each case as such Dollar amounts are set forth beside such Lender's name
under the applicable heading on Schedule C-1 or in the Assignment and Acceptance
pursuant to which such Lender became a Lender under the Agreement, as such
amounts may be reduced or increased from time to time pursuant to assignments
made in accordance with the provisions of Section 13.1 of the Agreement.
“Compliance Certificate” means a certificate substantially in the form of
Exhibit C-1 delivered by the chief financial officer, vice president of finance,
or treasurer of Borrower to Agent.
“Confidential Information” has the meaning specified therefor in Section 17.9(a)
of the Agreement.
“Control Agreement” means a control agreement, in form and substance reasonably
satisfactory to Agent, executed and delivered by Borrower or one of its
Subsidiaries, Agent, and the applicable securities intermediary (with respect to
a Securities Account) or bank (with respect to a Deposit Account).
“Controlled Account Agreement” has the meaning specified therefor in the
Security Agreement.
“Convertible Senior Notes” means the notes issued by Borrower pursuant to the
Indenture, in the aggregate amount of $100,000,000 as of the Closing Date, as
the same may be retired, redeemed, or exchanged from time to time.
“Copyright” has the meaning specified therefor in the Security Agreement.
“Copyright Security Agreement” has the meaning specified therefor in the
Security Agreement.
“Daily Balance” means, as of any date of determination and with respect to any
Obligation, the amount of such Obligation owed at the end of such day.
“Default” means an event, condition, or default that, with the giving of notice,
the passage of time, or both, would be an Event of Default.
“Defaulting Lender” means any Lender that (a) has failed to fund any amounts
required to be funded by it under the Agreement within 1 Business Day of the
date that it is required to do so under the Agreement (including the failure to
make available to Agent amounts required pursuant to a Settlement or to make a
required payment in connection with a Letter of Credit Disbursement), (b)
notified Borrower, Agent, or any Lender in writing that it does not intend to
comply with all or any portion of its funding obligations under the Agreement,
(c) has made a public statement to the effect that it does not intend to comply
with its funding obligations under the Agreement or under other agreements
generally (as reasonably determined by Agent) under which it has committed to
extend credit, (d) failed, within 1 Business Day after written request by Agent,
to confirm that it will comply with the terms of the Agreement relating to its
obligations to fund any amounts required to be funded by it under the Agreement,
(e) otherwise failed to pay over to Agent or any other Lender any other amount
required to be paid by it under the Agreement within 1 Business Day of the date
that it is required to do so under the Agreement, unless the subject of a good
faith dispute, or (f) (i) becomes or is insolvent or has a parent company that
has become or is insolvent or (ii) becomes the subject of a bankruptcy or
Insolvency Proceeding, or has had a receiver, conservator, trustee, or custodian
or appointed for it, or has taken any action in furtherance of, or indicating
its consent to, approval of or acquiescence in any such proceeding or
appointment or has a parent company that has become the subject of a bankruptcy
or Insolvency Proceeding, or has had a receiver, conservator, trustee, or
custodian appointed for it, or has taken any action in furtherance of, or
indicating its consent to, approval of or acquiescence in any such proceeding or
appointment.
“Defaulting Lender Rate” means (a) for the first 3 days from and after the date
the relevant payment is due, the Base Rate, and (b) thereafter, the interest
rate then applicable to Advances that are Base Rate Loans (inclusive of the Base
Rate Margin applicable thereto).
“Deposit Account” means any deposit account (as that term is defined in the
Code).
“Designated Account” means the Deposit Account of Borrower identified on
Schedule D-1.
“Designated Account Bank” has the meaning specified therefor in Schedule D-1.

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“Designated Contract” means, with respect to any Person, (i) each contract or
agreement to which such Person is a party involving aggregate consideration
payable to or by such Person of $15,000,000 or more (other than purchase orders
in the ordinary course of the business of such Person and other than contracts
that by their terms may be terminated by such Person in the ordinary course of
its business upon less than 60 days notice without penalty or premium), (ii)
each in-bound license relating to a game title accounting for more than 10% of
net sales during the immediately preceding fiscal year, (iii) each agreement
respecting the development of one or more game titles which involves payment in
excess of $30,000,000 in aggregate by a Loan Party to any Person other than
another Loan Party, (iv) each contract or agreement which is identified as a
material contract under any filing made within the last 4 fiscal quarters by a
Loan Party with the SEC, and (v) all other contracts or agreements, the loss of
which could reasonably be expected to result in a Material Adverse Change.
“Dilution” means, as of any date of determination, a percentage, based upon the
experience of the immediately prior 12 fiscal months, that is the result of
dividing the Dollar amount of (a) bad debt write-downs, discounts, advertising
allowances, credits, or other dilutive items with respect to Borrower's Accounts
during such period, by (b) Borrower's billings with respect to Accounts during
such period.
“Dilution Reserve” means, as of any date of determination, an amount sufficient
to reduce the advance rate against Eligible Accounts by 1 percentage point for
each percentage point by which Dilution is in excess of 5%.
“Dollars” or “$” means United States dollars.
“Earn-Outs” shall mean unsecured liabilities of a Loan Party arising under an
agreement to make any deferred payment as a part of the Purchase Price for a
Permitted Acquisition, including performance bonuses or consulting payments in
any related services, employment or similar agreement, in an amount that is
subject to or contingent upon the revenues, income, cash flow or profits (or the
like) of the underlying target.
“EBITDA” means, with respect to any fiscal period:
(a)    Borrower's consolidated net earnings (or loss),
minus
(b)    without duplication, the sum of the following amounts of Borrower for
such period to the extent included in determining consolidated net earnings (or
loss) for such period:
(i)    any extraordinary, unusual, or non-recurring gains,
(ii)    interest income,
(iii)    exchange, translation or performance gains relating to any hedging
transactions or foreign currency fluctuations,
(iv)     cash paid for net lease costs,
(v)    cash paid for severance costs, and
(vi)    realized cash losses related to investments,
plus
(c)    Without duplication, the sum of the following amounts of Borrower for
such period to the extent included in determining consolidated net earnings (or
loss) for such period:
(i)    any extraordinary, unusual, or non-recurring non-cash losses,
(ii)    interest expense,
(iii)    tax expense based on income, profits or capital, including federal,
foreign, state, franchise and similar taxes (and for the avoidance of doubt,
specifically excluding any sales taxes or any other taxes held in trust for a
Governmental Authority),

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(iv)    depreciation and amortization for such period,
(v)    non-cash compensation expense (including deferred non-cash compensation
expense), or other non-cash expenses or charges, arising from the sale or
issuance of stock, the granting of stock options, and the granting of stock
appreciation rights and similar arrangements (including any repricing,
amendment, modification, substitution, or change of any such stock, stock
option, stock appreciation rights, or similar arrangements) minus the amount of
any such expenses or charges when paid in cash to the extent not deducted in the
computation of net earnings (or loss),
(vi)    one time non-cash business alignment or non-cash restructuring charges,
(vii)    non-cash exchange, translation, or performance losses relating to any
hedging transactions or foreign currency fluctuations, and
(viii)    non-cash losses on sales of fixed assets or write-downs of fixed or
intangible assets, or non-cash studio closure-related write-downs.
plus
(d)    any applicable Cure Amount for such period,
plus
(e)    software amortization expense,
plus
(f)    product development expense,
minus
(g)    cash paid for capitalized software,
plus
(h)    license amortization expense,
minus
(i)    cash paid for capitalized licenses.
“Eligible Accounts” means those Accounts created by Borrower in the ordinary
course of its business, that arise out of Borrower's sale of goods or rendition
of services, that comply with each of the representations and warranties
respecting Eligible Accounts made in the Loan Documents, and that are not
excluded as ineligible by virtue of one or more of the excluding criteria set
forth below; provided, however, that such criteria may be revised from time to
time by Agent in Agent's Permitted Discretion to address the results of any
audit performed by Agent from time to time after the Closing Date. In
determining the amount to be included, Eligible Accounts shall be calculated net
of customer deposits and unapplied cash and where applicable, at the current
exchange rate. Eligible Accounts shall not include the following:
(a)Accounts that the Account Debtor has failed to pay within 90 days of original
invoice date or within 60 days of the original due date or Accounts with selling
terms of more than 90 days,

(b)Accounts owed by an Account Debtor (or its Affiliates) where 50% or more of
all Accounts owed by that Account Debtor (or its Affiliates) are deemed
ineligible under clause (a) above,

(c)Accounts with respect to which the Account Debtor is an Affiliate of Borrower
or an employee or agent of Borrower or any Affiliate of Borrower,

(d)Accounts arising in a transaction wherein goods are sold pursuant to a
guaranteed sale, a sale or return, a sale on approval, a bill and hold, or any
other terms by reason of which the payment by the Account Debtor may be
conditional,

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(e)Accounts that are not payable in Dollars or in Canadian dollars,

(f)Accounts payable in Canadian dollars in excess of $7,500,000 in the
aggregate,

(g)Accounts with respect to which the Account Debtor either (i) does not
maintain its chief executive office in the United States or Canada, or (ii) is
not organized under the laws of the United States, Canada or any state or
province thereof, or (iii) is the government of any foreign country or sovereign
state, or of any state, province, municipality, or other political subdivision
thereof, or of any department, agency, public corporation, or other
instrumentality thereof, unless (y) the Account is supported by an irrevocable
letter of credit reasonably satisfactory to Agent (as to form, substance, and
issuer or domestic confirming bank) that has been delivered to Agent and is
directly drawable by Agent, or (z) the Account is covered by credit insurance in
form, substance, and amount, and by an insurer, reasonably satisfactory to
Agent,

(h)Accounts with respect to which the Account Debtor is either (i) the United
States or any department, agency, or instrumentality of the United States
(exclusive, however, of Accounts with respect to which Borrower has complied, to
the reasonable satisfaction of Agent, with the Assignment of Claims Act, 31 USC
§3727), or (ii) any state of the United States,

(i)Accounts with respect to which the Account Debtor is a creditor of Borrower,
has or has asserted a right of setoff, or has disputed its obligation to pay all
or any portion of the Account, to the extent of such claim, right of setoff, or
dispute,

(j)Accounts with respect to an Account Debtor whose total obligations owing to
Borrower exceed (i) 50% with respect to GameStop Corporation and its Affiliates;
(ii) 25% with respect to Best Buy Co., Inc. and its Affiliates; (iii) 25% with
respect to Target Corporation and its Affiliates; (iv) 15% with respect to Toys
“R” Us, Inc. and its Affiliates; (v) 15% with respect to COKeM International
Ltd. and its Affiliates; or (vi) 10% for any other Account Debtor (such
percentages, as applied to any particular Account Debtor, being subject to
reduction by Agent in its Permitted Discretion if the creditworthiness of such
Account Debtor deteriorates) of all Eligible Accounts, to the extent of the
obligations owing by such Account Debtor in excess of such percentage; provided,
however, that, in each case, the amount of Eligible Accounts that are excluded
because they exceed the foregoing percentage shall be determined by Agent based
on all of the otherwise Eligible Accounts prior to giving effect to any
eliminations based upon the foregoing concentration limit,

(k)Accounts with respect to which the Account Debtor is subject to an Insolvency
Proceeding, is not Solvent, has gone out of business, or as to which Borrower
has received notice of an imminent Insolvency Proceeding or a material
impairment of the financial condition of such Account Debtor,

(l)Accounts, the collection of which, Agent, in its Permitted Discretion,
reasonably believes to be doubtful by reason of the Account Debtor's financial
condition,

(m)Accounts that are not subject to a valid and perfected first priority Agent's
Lien,

(n)Accounts with respect to which (i) the goods giving rise to such Account have
not been shipped and billed to the Account Debtor, or (ii) the services giving
rise to such Account have not been performed and billed to the Account Debtor,

(o)Accounts with respect to which the Account Debtor is a Sanctioned Person or
Sanctioned Entity,

(p)Accounts that represent the right to receive progress payments or other
advance billings that are due prior to the completion of performance by Borrower
of the subject contract for goods or services, or

(q)Accounts where the Account Debtor with respect to such Accounts is Walmart
Stores, Inc. or any of its domestic Subsidiaries or Affiliates for as long as
the Walmart Receivables Purchase Agreement is in effect and thereafter until
Agent has completed a field examination to its satisfaction with respect to such
Accounts.

“Eligible Inventory” means Inventory consisting of first quality finished goods
held for sale in the ordinary course of Borrower's business, that complies with
each of the representations and warranties respecting Eligible Inventory made in
the Loan Documents, and that is not excluded as ineligible by virtue of one or
more of the excluding criteria set forth below; provided, however, that such
criteria may be revised from time to time by Agent in Agent's Permitted
Discretion to address the results of any audit or appraisal performed by Agent
from time to time after the Closing Date. In determining the amount to be so
included, Inventory shall be valued on a basis consistent with Borrower's
historical accounting practices. An item of Inventory shall not be included in
Eligible Inventory if:
a.Borrower does not have good, valid, and marketable title thereto,

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b.Borrower does not have actual and exclusive possession thereof (either
directly or through a bailee or agent of Borrower),

c.it is not located at one of the locations in the continental United States set
forth on Schedule E-1 (or in-transit from one such location to another such
location),

d.it is in-transit to or from a location of Borrower (other than (i) in-transit
from one location set forth on Schedule E-1 to another location set forth on
Schedule E-1 or (ii) up to $5,000,000 in the aggregate at any one time of goods
in-transit from a location of Borrower set forth on Schedule E-1 to a retailer,

e.it is located on real property leased by Borrower or in a contract warehouse,
in each case, unless it is subject to a Collateral Access Agreement executed by
the lessor or warehouseman, as the case may be, and unless it is segregated or
otherwise separately identifiable from goods of others, if any, stored on the
premises,

f.it is the subject of a bill of lading or other document of title,

g.it is not subject to a valid and perfected first priority Agent's Lien,

h.it consists of goods returned or rejected by Borrower's customers,

i.it consists of goods that are obsolete or slow moving, restrictive or custom
items, work-in-process, raw materials, or goods that constitute spare parts,
packaging and shipping materials, supplies used or consumed in Borrower's
business, bill and hold goods, defective goods, “seconds,” or Inventory acquired
on consignment,

j.it is sold under the “ValuSoft” brand, or

k.it was acquired in connection with a Permitted Acquisition, until the
completion of an appraisal and field examination of such Inventory, in each
case, reasonably satisfactory to Agent (which appraisal and field examination
may be conducted prior to the closing of such Permitted Acquisition).

“Eligible Titles” means Borrower's owned catalog of video game titles (for the
avoidance of doubt, Eligible Titles shall not include licensed video game
titles) that complies with each of the representations and warranties respecting
Eligible Titles made in the Loan Documents, and that is not excluded as
ineligible by virtue of one or more of the excluding criteria set forth herein;
provided, however, that such criteria may be revised from time to time by Agent
in Agent's Permitted Discretion to address the results of any audit or appraisal
performed by Agent from time to time after the Closing Date. A video game title
shall not be included in Eligible Titles if its fair market value has not been
appraised by a recent appraisal (not older than 1 calendar year in any event)
prepared by an appraiser and in form and substance satisfactory to Agent.
“Eligible Transferee” means (a) a commercial bank organized under the laws of
the United States, or any state thereof, and having total assets in excess of
$250,000,000, (b) a commercial bank organized under the laws of any other
country which is a member of the Organization for Economic Cooperation and
Development or a political subdivision of any such country and which has total
assets in excess of $250,000,000, provided that such bank is acting through a
branch or agency located in the United States, (c) a finance company, insurance
company, or other financial institution or fund that is engaged in making,
purchasing, or otherwise investing in commercial loans in the ordinary course of
its business and having (together with its Affiliates) total assets in excess of
$250,000,000, (d) any Affiliate (other than individuals) of a pre-existing
Lender, (e) so long as no Event of Default has occurred and is continuing, any
other Person approved by Agent and Borrower (such approval by Borrower not to be
unreasonably withheld, conditioned or delayed), and (f) during the continuation
of an Event of Default, any other Person approved by Agent.
“Environmental Action” means any written complaint, summons, citation, notice,
directive, order, claim, litigation, investigation, judicial or administrative
proceeding, judgment, letter, or other written communication from any
Governmental Authority, or any third party involving violations of Environmental
Laws or releases of Hazardous Materials (a) from any assets, properties, or
businesses of Borrower, any Subsidiary of Borrower, or any of their predecessors
in interest, (b) from adjoining properties or businesses, or (c) from or onto
any facilities which received Hazardous Materials generated by Borrower, any
Subsidiary of Borrower, or any of their predecessors in interest.
“Environmental Law” means any applicable federal, state, provincial, foreign or
local statute, law, rule, regulation, ordinance, code, binding and enforceable
guideline, binding and enforceable written policy, or rule of common law now or
hereafter in effect and in each case as amended, or any judicial or
administrative interpretation thereof, including any judicial or administrative

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order, consent decree or judgment, in each case, to the extent binding on
Borrower or its Subsidiaries, relating to the environment, the effect of the
environment on employee health, or Hazardous Materials, in each case as amended
from time to time.
“Environmental Liabilities” means all liabilities, monetary obligations, losses,
damages, costs and expenses (including all reasonable fees, disbursements and
expenses of counsel, experts, or consultants, and costs of investigation and
feasibility studies), fines, penalties, sanctions, and interest incurred as a
result of any claim or demand, or Remedial Action required, by any Governmental
Authority or any third party, and which relate to any Environmental Action.
“Environmental Lien” means any Lien in favor of any Governmental Authority for
Environmental Liabilities.
“Equipment” means equipment (as that term is defined in the Code).
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended,
and any successor statute thereto.
“ERISA Affiliate” means (a) any Person subject to ERISA whose employees are
treated as employed by the same employer as the employees of Borrower or its
Subsidiaries under IRC Section 414(b), (b) any trade or business subject to
ERISA whose employees are treated as employed by the same employer as the
employees of Borrower or its Subsidiaries under IRC Section 414(c), (c) solely
for purposes of Section 302 of ERISA and Section 412 of the IRC, any
organization subject to ERISA that is a member of an affiliated service group of
which Borrower or any of its Subsidiaries is a member under IRC Section 414(m),
or (d) solely for purposes of Section 302 of ERISA and Section 412 of the IRC,
any Person subject to ERISA that is a party to an arrangement with Borrower or
its Subsidiaries and whose employees are aggregated with the employees of
Borrower or its Subsidiaries under IRC Section 414(o).
“Event of Default” has the meaning specified therefor in Section 8 of the
Agreement.
“Excess Availability” means, as of any date of determination, the amount equal
to Availability minus the aggregate amount, if any, of all trade payables of
Borrower and its Subsidiaries aged in excess of historical levels with respect
thereto and all book overdrafts of Borrower and its Subsidiaries in excess of
historical practices with respect thereto, in each case as determined by Agent
in its Permitted Discretion.
“Exchange Act” means the Securities Exchange Act of 1934, as in effect from time
to time.
“Existing Credit Facility” means, the existing credit facility provided to
Borrower and its Subsidiaries by Bank of America, N.A. pursuant to that certain
Loan and Security Agreement dated as of June 30, 2009 by and between Bank of
America, N.A. and Borrower.
“Federal Funds Rate” means, for any period, a fluctuating interest rate per
annum equal to, for each day during such period, the weighted average of the
rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers, as published on the next
succeeding Business Day by the Federal Reserve Bank of New York, or, if such
rate is not so published for any day which is a Business Day, the average of the
quotations for such day on such transactions received by Agent from three
Federal funds brokers of recognized standing selected by it.
“Fee Letter” means that certain fee letter, dated as of even date with the
Agreement, among Borrower and Agent, in form and substance reasonably
satisfactory to Agent.
“Fixed Charges” means, with respect to any fiscal period and with respect to
Borrower determined on a consolidated basis in accordance with GAAP, the sum,
without duplication, of (a) Interest Expense accrued (other than interest
paid-in-kind, amortization of financing fees, and other non-cash Interest
Expense) during such period, (b) principal payments in respect of Indebtedness
that are required to be paid during such period, (c) all federal, state, and
local income taxes paid in cash during such period, net of cash tax refunds not
to exceed the amount of such cash tax payments, (d) all Restricted Junior
Payments paid (whether in cash or other property, other than common Stock)
during such period, and (e) any JAKKS Payments paid during such period.
“Fixed Charge Coverage Ratio” means, with respect to Borrower and its
Subsidiaries for any period, the ratio of (i) EBITDA for such period minus
non-financed Capital Expenditures made (to the extent not already incurred in a
prior period) or incurred during such period, to (ii) Fixed Charges for such
period.
“Foreign Lender” means any Lender or Participant that is not a United States
person within the meaning of IRC section 7701(a)(30).
“Funding Date” means the date on which a Borrowing occurs.

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“Funding Losses” has the meaning specified therefor in Section 2.12(b)(ii) of
the Agreement.
“GAAP” means generally accepted accounting principles as in effect from time to
time in the United States, consistently applied; provided, however, that all
calculations relative to liabilities shall be made without giving effect to
Statement of Financial Accounting Standards No. 159.
“Governing Documents” means, with respect to any Person, the certificate or
articles of incorporation, by-laws, or other organizational documents of such
Person.
“Governmental Authority” means any federal, state, local, or other governmental
or administrative body, instrumentality, board, department, or agency or any
court, tribunal, administrative hearing body, arbitration panel, commission, or
other similar dispute-resolving panel or body.
“Guarantors” means (a) each Subsidiary of Borrower (other than any Subsidiary
that is not required to become a Guarantor pursuant to Section 5.11), and (b)
each other Person that becomes a guarantor after the Closing Date pursuant to
Section 5.11 of the Agreement, and “Guarantor” means any one of them.
“Guaranty” means that certain general continuing guaranty, dated as of even date
with the Agreement, executed and delivered by each extant Guarantor in favor of
Agent, for the benefit of the Lender Group and the Bank Product Providers, in
form and substance reasonably satisfactory to Agent.
“Hazardous Materials” means (a) substances that are defined or listed in, or
otherwise classified pursuant to, any applicable laws or regulations as
“hazardous substances,” “hazardous materials,” “hazardous wastes,” “toxic
substances,” or any other formulation intended to define, list, or classify
substances by reason of deleterious properties such as ignitability,
corrosivity, reactivity, carcinogenicity, reproductive toxicity, or “EP
toxicity”, (b) oil, petroleum, or petroleum derived substances, natural gas,
natural gas liquids, synthetic gas, drilling fluids, produced waters, and other
wastes associated with the exploration, development, or production of crude oil,
natural gas, or geothermal resources, (c) any flammable substances or explosives
or any radioactive materials, and (d) asbestos in any form or electrical
equipment that contains any oil or dielectric fluid containing levels of
polychlorinated biphenyls in excess of 50 parts per million.
“Hedge Agreement” means a “swap agreement” as that term is defined in Section
101(53B)(A) of the Bankruptcy Code.
“Hedge Obligations” means any and all obligations or liabilities, whether
absolute or contingent, due or to become due, now existing or hereafter arising,
of Borrower or its Subsidiaries arising under, owing pursuant to, or existing in
respect of Hedge Agreements entered into with one or more of the Bank Product
Providers.
“Hedge Provider” means any Lender or any of its Affiliates; provided, however,
that no such Person (other than Wells Fargo or its Affiliates) shall constitute
a Hedge Provider unless and until Agent shall have received a Bank Product
Provider Letter Agreement from such Person and with respect to the applicable
Hedge Agreement within 10 days after the execution and delivery of such Hedge
Agreement with Borrower or its Subsidiaries; provided further, however, that if,
at any time, a Lender ceases to be a Lender under the Agreement, then, from and
after the date on which it ceases to be a Lender thereunder, neither it nor any
of its Affiliates shall constitute Hedge Providers and the obligations with
respect to Hedge Agreements entered into with such former Lender or any of its
Affiliates shall no longer constitute Hedge Obligations.
“Holdout Lender” has the meaning specified therefor in Section 14.2(a) of the
Agreement.
“Inactive Subsidiaries” means THQ Digital Studios Phoenix, Inc., an Arizona
corporation.
“Indebtedness” as to any Person means (a) all obligations of such Person for
borrowed money, (b) all obligations of such Person evidenced by bonds,
debentures, notes, or other similar instruments and all reimbursement or other
obligations in respect of letters of credit, bankers acceptances, or other
financial products, (c) all obligations of such Person as a lessee under Capital
Leases, (d) all obligations or liabilities of others secured by a Lien on any
asset of such Person, irrespective of whether such obligation or liability is
assumed, (e) all obligations of such Person to pay the deferred purchase price
of assets (other than trade payables incurred in the ordinary course of business
and repayable in accordance with customary trade practices), (f) all obligations
of such Person owing under Hedge Agreements (which amount shall be calculated
based on the amount that would be payable by such Person if the Hedge Agreement
were terminated on the date of determination), (g) any Prohibited Preferred
Stock of such Person, and (h) any obligation of such Person guaranteeing or
intended to guarantee (whether directly or indirectly guaranteed, endorsed,
co-made, discounted, or sold with recourse) any obligation of any other Person
that constitutes Indebtedness under any of clauses (a) through (g) above. For
purposes of this definition, (i) the amount of any Indebtedness represented by a
guaranty or

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other similar instrument shall be the lesser of the principal amount of the
obligations guaranteed and still outstanding and the maximum amount for which
the guaranteeing Person may be liable pursuant to the terms of the instrument
embodying such Indebtedness, and (ii) the amount of any Indebtedness described
in clause (d) above shall be the lower of the amount of the obligation and the
fair market value of the assets of such Person securing such obligation.
“Indemnified Liabilities” has the meaning specified therefor in Section 10.3 of
the Agreement.
“Indemnified Person” has the meaning specified therefor in Section 10.3 of the
Agreement.
“Indenture” means that certain Indenture between Borrower, as issuer, and Union
Bank, N.A, as trustee, dated August 4, 2009.
“Insolvency Proceeding” means any proceeding commenced by or against any Person
under any provision of the Bankruptcy Code or under any other state or federal
bankruptcy or insolvency law, assignments for the benefit of creditors, formal
or informal moratoria, compositions, extensions generally with creditors, or
proceedings seeking reorganization, arrangement, or other similar relief.
“Intellectual Property” has the meaning specified therefor in the Security
Agreement.
“Intellectual Property Claim” means any claim or assertion (whether in writing,
by suit or otherwise) that Borrower's or any Loan Party's ownership, use,
marketing, sale or distribution of any Inventory, Equipment, Intellectual
Property or other property violates another Person's Intellectual Property.
“Intellectual Property License” has the meaning set forth in the Security
Agreement.
“Intercompany Subordination Agreement” means an intercompany subordination
agreement, dated as of even date with the Agreement, executed and delivered by
Borrower, the Loan Parties, THQ (UK) Ltd., a company organized under the laws of
England and Wales, and Agent, the form and substance of which is reasonably
satisfactory to Agent.
“Interest Expense” means, for any period, the aggregate of the cash interest
expense paid by Borrower for such period, determined on a consolidated basis in
accordance with GAAP.
“Interest Period” means, with respect to each LIBOR Rate Loan, a period
commencing on the date of the making of such LIBOR Rate Loan (or the
continuation of a LIBOR Rate Loan or the conversion of a Base Rate Loan to a
LIBOR Rate Loan) and ending 1, 2, or 3 months thereafter; provided, however,
that (a) interest shall accrue at the applicable rate based upon the LIBOR Rate
from and including the first day of each Interest Period to, but excluding, the
day on which any Interest Period expires, (b) any Interest Period that would end
on a day that is not a Business Day shall be extended to the next succeeding
Business Day unless such Business Day falls in another calendar month, in which
case such Interest Period shall end on the next preceding Business Day, (c) with
respect to an Interest Period that begins on the last Business Day of a calendar
month (or on a day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period), the Interest Period shall
end on the last Business Day of the calendar month that is 1, 2, or 3 months
after the date on which the Interest Period began, as applicable, and (d)
Borrower may not elect an Interest Period which will end after the Maturity
Date.
“Inventory” means inventory (as that term is defined in the Code).
“Inventory Sublimit” means (a) $12,500,000 from the Closing Date through
September 30, 2011; (b) $25,000,000 from October 1, 2011 through December 14,
2011; and (c) $12,500,000 thereafter.
“Investment” means, with respect to any Person, any investment by such Person in
any other Person (including Affiliates) in the form of loans, guarantees,
advances, capital contributions (excluding (a) commission, travel, and similar
advances to officers and employees of such Person made in the ordinary course of
business, and (b) bona fide Accounts arising in the ordinary course of
business), or acquisitions of Indebtedness, Stock, or all or substantially all
of the assets of such other Person (or of any division or business line of such
other Person), and any other items that are or would be classified as
investments on a balance sheet prepared in accordance with GAAP.
“IP Advance Rate” means, 35%; provided, that commencing on September 1 of each
year and continuing until and including November 30 of the same year, such
percentage shall be increased to 75%.
“IP Reporting Certificate” means an IP Reporting Certificate substantially in
the form of Exhibit I-1.

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“IP Sublimit” means, $7,500,000; provided, that commencing on September 1 of
each year and continuing until and including November 30 of the same year, such
amount shall be increased to $15,000,000.
“IRC” means the Internal Revenue Code of 1986, as in effect from time to time.
“Issuing Lender” means WFCF or any other Lender that, at the request of Borrower
and with the consent of Agent, agrees, in such Lender's sole discretion, to
become an Issuing Lender for the purpose of issuing Letters of Credit or
Reimbursement Undertakings pursuant to Section 2.11 of the Agreement and the
Issuing Lender shall be a Lender.
“JAKKS” means JAKKS Pacific, Inc.
“JAKKS Agreements” means (a) that certain Settlement Agreement and Mutual
Release among Borrower, JAKKS, and THQ/JAKKS Pacific, LLC dated December 22,
2009 and (b) that certain Agreement between JAKKS and Borrower dated December
22, 2009.
“JAKKS Payments” distributions and payments by Borrower to JAKKS, pursuant to
that certain Settlement Agreement and Mutual Release among Borrower, JAKKS, and
THQ/JAKKS Pacific, LLC dated December 22, 2009.
“Lender” has the meaning set forth in the preamble to the Agreement, shall
include the Issuing Lender and the Swing Lender, and shall also include any
other Person made a party to the Agreement pursuant to the provisions of Section
13.1 of the Agreement and “Lenders” means each of the Lenders or any one or more
of them.
“Lender Group” means each of the Lenders (including the Issuing Lender and the
Swing Lender) and Agent, or any one or more of them.
“Lender Group Expenses” means all (a) costs or expenses (including taxes, and
insurance premiums) required to be paid by Borrower or its Subsidiaries under
any of the Loan Documents that are paid, advanced, or incurred by the Lender
Group, (b) reasonable and documented out-of-pocket fees or charges paid or
incurred by Agent in connection with the Lender Group's transactions with
Borrower or its Subsidiaries under any of the Loan Documents, including, fees or
charges for photocopying, notarization, couriers and messengers,
telecommunication, public record searches (including tax lien, litigation, and
UCC searches and including searches with the patent and trademark office, the
copyright office, or the department of motor vehicles), filing, recording,
publication, appraisal (including periodic collateral appraisals or business
valuations to the extent of the fees and charges (and up to the amount of any
limitation) contained in the Agreement), real estate surveys, real estate title
policies and endorsements, and environmental audits, (c) Agent's customary fees
and charges (as adjusted from time to time) with respect to the disbursement of
funds (or the receipt of funds) to or for the account of Borrower (whether by
wire transfer or otherwise), together with any out-of-pocket costs and expenses
incurred in connection therewith, (d) out-of-pocket charges paid or incurred by
Agent resulting from the dishonor of checks payable by or to any Loan Party, (e)
reasonable out-of-pocket costs and expenses paid or incurred by the Lender Group
to correct any default or enforce any provision of the Loan Documents, or during
the continuance of an Event of Default, in gaining possession of, maintaining,
handling, preserving, storing, shipping, selling, preparing for sale, or
advertising to sell the Collateral, or any portion thereof, irrespective of
whether a sale is consummated, (f) reasonable out-of-pocket audit fees and
expenses (including travel, meals, and lodging) of Agent related to any
inspections or audits to the extent of the fees and charges (and up to the
amount of any limitation) contained in the Agreement or the Fee Letter, (g)
reasonable out-of-pocket costs and expenses of third party claims or any other
suit paid or incurred by the Lender Group in enforcing or defending the Loan
Documents or in connection with the transactions contemplated by the Loan
Documents or the Lender Group's relationship with Borrower or any of its
Subsidiaries, (h) Agent's reasonable costs and expenses (including reasonable
attorneys fees) incurred in advising, structuring, drafting, reviewing,
administering (including travel, meals, and lodging), syndicating, or amending
the Loan Documents, (i) Agent's and each Lender's reasonable costs and expenses
(including reasonable attorneys, accountants, consultants, and other advisors
fees and expenses) incurred in terminating, enforcing (including attorneys,
accountants, consultants, and other advisors fees and expenses incurred in
connection with a “workout,” a “restructuring,” or an Insolvency Proceeding
concerning Borrower or any of its Subsidiaries or in exercising rights or
remedies under the Loan Documents), or defending the Loan Documents,
irrespective of whether suit is brought, or in taking any Remedial Action
concerning the Collateral, and (j) usage charges, charges, fees, costs and
expenses for amendments, renewals, extensions, transfers, or drawings from time
to time imposed by the Underlying Issuer or incurred by the Issuing Lender in
respect of Letters of Credit and out-of-pocket charges, fees, costs and expenses
paid or incurred by the Underlying Issuer or Issuing Lender in connection with
the issuance, amendment, renewal, extension, or transfer of, or drawing under,
any Letter of Credit or any demand for payment thereunder.
“Lender Group Representatives” has the meaning specified therefor in Section
17.9 of the Agreement.
“Lender-Related Person” means, with respect to any Lender, such Lender, together
with such Lender's Affiliates, officers,

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directors, employees, attorneys, and agents.
“Letter of Credit” means a letter of credit (as that term is defined in the
Code) issued by Issuing Lender or a letter of credit (as that term is defined in
the Code) issued by Underlying Issuer, as the context requires.
“Letter of Credit Collateralization” means either (a) providing cash collateral
(pursuant to documentation reasonably satisfactory to Agent, including
provisions that specify that the Letter of Credit fee and all usage charges set
forth in the Agreement will continue to accrue while the Letters of Credit are
outstanding) to be held by Agent for the benefit of those Lenders with a
Revolver Commitment in an amount equal to 105% of the then existing Letter of
Credit Usage, (b) delivering to Agent documentation executed by all
beneficiaries under the Letters of Credit, in form and substance reasonably
satisfactory to Agent and the Issuing Lender, terminating all of such
beneficiaries' rights under the Letters of Credit, or (c) providing Agent with a
standby letter of credit, in form and substance reasonably satisfactory to
Agent, from a commercial bank acceptable to Agent (in its sole discretion) in an
amount equal to 105% of the then existing Letter of Credit Usage (it being
understood that the Letter of Credit fee and all usage charges set forth in the
Agreement will continue to accrue while the Letters of Credit are outstanding
and that any such fees that accrue must be an amount that can be drawn under any
such standby letter of credit).
“Letter of Credit Disbursement” means a payment made by Issuing Lender or
Underlying Issuer pursuant to a Letter of Credit.
“Letter of Credit Usage” means, as of any date of determination, the aggregate
undrawn amount of all outstanding Letters of Credit.
“LIBOR Deadline” has the meaning specified therefor in Section 2.12(b)(i) of the
Agreement.
“LIBOR Notice” means a written notice in the form of Exhibit L-1.
“LIBOR Option” has the meaning specified therefor in Section 2.12(a) of the
Agreement.
“LIBOR Rate” means the rate per annum rate appearing on Bloomberg L.P.'s (the
“Service”) Page BBAM1/(Official BBA USD Dollar Libor Fixings) (or on any
successor or substitute page of such Service, or any successor to or substitute
for such Service) 2 Business Days prior to the commencement of the requested
Interest Period, for a term and in an amount comparable to the Interest Period
and the amount of the LIBOR Rate Loan requested (whether as an initial LIBOR
Rate Loan or as a continuation of a LIBOR Rate Loan or as a conversion of a Base
Rate Loan to a LIBOR Rate Loan) by Borrower in accordance with the Agreement,
which determination shall be conclusive in the absence of manifest error.
“LIBOR Rate Loan” means each portion of an Advance that bears interest at a rate
determined by reference to the LIBOR Rate.
“LIBOR Rate Margin” means, as of any date of determination (with respect to any
portion of the outstanding Advances on such date that is a LIBOR Rate Loan), the
applicable margin set forth in the following table that correspond to the
Revolver Usage:
Level
Revolver Usage
LIBOR Rate Margin
I
< $42,500,000
3.75%
II
> $42,500,000
4%

The LIBOR Rate Margin shall be based upon the Revolver Usage calculated as of
the end of each fiscal quarter; provided, that the LIBOR Rate Margin on the
Closing Date shall be based upon the Revolver Usage after giving effect to the
initial Advances and issuance of Letters of Credit. Except as set forth in the
foregoing proviso, the LIBOR Rate Margin shall be re-determined quarterly on the
first day of the month following such date of determination.
“Lien” means any mortgage, deed of trust, pledge, hypothecation, assignment,
charge, deposit arrangement, encumbrance, easement, lien (statutory or other),
security interest, or other security arrangement and any other preference,
priority, or preferential arrangement of any kind or nature whatsoever,
including any conditional sale contract or other title retention agreement, the
interest of a lessor under a Capital Lease and any synthetic or other financing
lease having substantially the same economic effect as any of the foregoing.
“Loan Account” has the meaning specified therefor in Section 2.9 of the
Agreement.

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“Loan Documents” means the Agreement, any Borrowing Base Certificate, the
Controlled Account Agreements, the Control Agreements, the Copyright Security
Agreement, the Fee Letter, the Guaranty, the Intercompany Subordination
Agreement, the Letters of Credit, the Mortgages, the Patent Security Agreement,
the Security Agreement, the Trademark Security Agreement, any note or notes
executed by Borrower in connection with the Agreement and payable to any member
of the Lender Group, any letter of credit application or letter of credit
agreement entered into by Borrower in connection with the Agreement, and any
other instrument or agreement entered into, now or in the future, by Borrower or
any of the Loan Parties and any member of the Lender Group in connection with
the Agreement.
“Loan Party” means Borrower or any Guarantor.
“Margin Stock” as defined in Regulation U of the Board of Governors of the
Federal Reserve System as in effect from time to time.
“Material Adverse Change” means (a) a material adverse change in the business,
prospects, operations, results of operations, assets, liabilities or condition
(financial or otherwise) of Borrower and its Subsidiaries, taken as a whole, (b)
a material impairment of Borrower's and its Subsidiaries ability to perform
their obligations under the Loan Documents to which they are parties or of the
Lender Group's ability to enforce the Obligations or realize upon the
Collateral, or (c) a material impairment of the enforceability or priority of
Agent's Liens with respect to the Collateral as a result of an action or failure
to act on the part of Borrower or its Subsidiaries.
“Material Intellectual Property License” has the meaning specified therefore in
the Security Agreement.
“Material IP” means any Intellectual Property or license the unavailability of
which (regardless of cause, including by reason of breach by a third party, or
scheduled expiration or termination) could reasonably be expected to (i)
materially impair the value or merchantability in the ordinary course of
business of products representing Inventory that (x) accounted for not less than
10% of the total net sales of Borrower and its Subsidiaries on a consolidated
basis for the most recently-completed fiscal year in respect of which Borrower
has provided Agent with financial statements, or (y) is projected to account for
more than 10% of the total net sales of Borrower and its Subsidiaries on a
consolidated basis for the current fiscal year (such projections to be utilized
for any prior fiscal year in respect of which Borrower shall not have provided
Agent with financial statements), or (ii) result in a Material Adverse Change.
“Maturity Date” has the meaning specified therefor in Section 3.3 of the
Agreement.
“Maximum Revolver Amount” means (a) $50,000,000 from the Closing Date through
September 30, 2011; (b) $75,000,000 from October 1, 2011 through December 14,
2011; and (c) $50,000,000 thereafter, decreased by the amount of reductions in
the Revolver Commitments made in accordance with Section 2.4(c) of the
Agreement.
“Maximum Revolver Amount Excess” has the meaning set forth in Section 2.4(e).
“Moody's” has the meaning specified therefor in the definition of Cash
Equivalents.
“Mortgages” means, individually and collectively, one or more mortgages, deeds
of trust, or deeds to secure debt, executed and delivered by Borrower or its
Subsidiaries in favor of Agent, in form and substance reasonably satisfactory to
Agent, that encumber the Real Property Collateral.
“Net Liquidation Percentage” means the percentage of Borrower's Inventory that
is estimated to be recoverable in an orderly liquidation of such Inventory net
of all associated costs and expenses of such liquidation, such percentage to be
as determined from time to time by an appraisal company selected by Agent.
“Obligations” means (a) all loans (including the Advances (inclusive of
Protective Advances and Swing Loans)), debts, principal, interest (including any
interest that accrues after the commencement of an Insolvency Proceeding,
regardless of whether allowed or allowable in whole or in part as a claim in any
such Insolvency Proceeding), reimbursement or indemnification obligations with
respect to Reimbursement Undertakings or with respect to Letters of Credit
(irrespective of whether contingent), premiums, liabilities (including all
amounts charged to the Loan Account pursuant to the Agreement), obligations
(including indemnification obligations), fees (including the fees provided for
in the Fee Letter), Lender Group Expenses (including any fees or expenses that
accrue after the commencement of an Insolvency Proceeding, regardless of whether
allowed or allowable in whole or in part as a claim in any such Insolvency
Proceeding), guaranties, and all covenants and duties of any other kind and
description owing by any Loan Party pursuant to or evidenced by the Agreement or
any of the other Loan Documents and irrespective of whether for the payment of
money, whether direct or indirect, absolute or contingent, due or to become due,
now existing or

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hereafter arising, and including all interest not paid when due and all other
expenses or other amounts that Borrower is required to pay or reimburse by the
Loan Documents or by law or otherwise in connection with the Loan Documents, (b)
all debts, liabilities, or obligations (including reimbursement obligations,
irrespective of whether contingent) owing by Borrower or any other Loan Party to
an Underlying Issuer now or hereafter arising from or in respect of Underlying
Letters of Credit, and (c) all Bank Product Obligations. Any reference in the
Agreement or in the Loan Documents to the Obligations shall include all or any
portion thereof and any extensions, modifications, renewals, or alterations
thereof, both prior and subsequent to any Insolvency Proceeding.
“OFAC” means The Office of Foreign Assets Control of the U.S. Department of the
Treasury.
“Originating Lender” has the meaning specified therefor in Section 13.1(e) of
the Agreement.
“Overadvance” has the meaning specified therefor in Section 2.5 of the
Agreement.
“Participant” has the meaning specified therefor in Section 13.1(e) of the
Agreement.
“Participant Register” has the meaning set forth in Section 13.1(i) of the
Agreement.
“Patent” has the meaning specified therefor in the Security Agreement.
“Patent Security Agreement” has the meaning specified therefor in the Security
Agreement.
“Patriot Act” has the meaning specified therefor in Section 4.18 of the
Agreement.
“Payoff Date” means the first date on which all of the Obligations are paid in
full and the Commitments of the Lenders are terminated.
“Permitted Acquisition” means any Acquisition so long as:
a.no Default or Event of Default shall have occurred and be continuing or would
result from the consummation of the proposed Acquisition and the proposed
Acquisition is consensual,

b.no Indebtedness will be incurred, assumed, or would exist with respect to
Borrower or a Loan Party as a result of such Acquisition, other than
Indebtedness permitted under clauses (f) or (g) of the definition of Permitted
Indebtedness and no Liens will be incurred, assumed, or would exist with respect
to the assets of Borrower or a Loan Party as a result or such Acquisition other
than Permitted Liens,

c.Borrower has provided Agent with written confirmation, supported by reasonably
detailed calculations, that on a pro forma basis (including pro forma
adjustments arising out of events which are directly attributable to such
proposed Acquisition, are factually supportable, and are expected to have a
continuing impact, in each case, determined as if the combination had been
accomplished at the beginning of the relevant period; such eliminations and
inclusions to be mutually and reasonably agreed upon by Borrower and Agent)
created by adding the historical combined financial statements of Borrower
(including the combined financial statements of any other Person or assets that
were the subject of a prior Permitted Acquisition during the relevant period) to
the historical consolidated financial statements of the Person to be acquired
(or the historical financial statements related to the assets to be acquired)
pursuant to the proposed Acquisition, Borrower and the Loan Parties (i) would
have been in compliance with the financial covenants in Section 7 of the
Agreement for the 4 fiscal quarter period ended immediately prior to the
proposed date of consummation of such proposed Acquisition (regardless of
whether a Trigger Period is in effect), and (ii) are projected to be in
compliance with (x) the financial covenants in Section 7 for the 4 fiscal
quarter period ended one year after the proposed date of consummation of such
proposed Acquisition (regardless of whether a Trigger Period is in effect) and
(y) the requirement set forth in clause (e) below on the last day of each of the
12 months following the proposed date of consummation of such proposed
Acquisition,

d.Borrower has provided Agent with its due diligence package relative to the
proposed Acquisition, including forecasted balance sheets, profit and loss
statements, and cash flow statements of the Person or assets to be acquired, all
prepared on a basis consistent with such Person's (or assets') historical
financial statements, together with appropriate supporting details and a
statement of underlying assumptions for the 1 year period following the date of
the proposed Acquisition, on a quarter by quarter basis), in form and substance
(including as to scope and underlying assumptions) reasonably satisfactory to
Agent,

e.The sum of (i) Availability plus (ii) Qualified Cash shall be at least
$50,000,000 immediately after giving effect to the consummation of the proposed
Acquisition,

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f.the assets being acquired or the Person whose Stock is being acquired did not
have negative EBITDA during the 12 consecutive month period most recently
concluded prior to the date of the proposed Acquisition,

g.Borrower has provided Agent with written notice of the proposed Acquisition at
least 15 Business Days prior to the anticipated closing date of the proposed
Acquisition and, not later than 5 Business Days prior to the anticipated closing
date of the proposed Acquisition, copies of the acquisition agreement and other
material documents relative to the proposed Acquisition, which agreement and
documents must be reasonably acceptable to Agent,

h.the assets being acquired (other than a de minimis amount of assets in
relation to Borrower's and its Subsidiaries' total assets), or the Person whose
Stock is being acquired, are useful in or engaged in, as applicable, the
business of Borrower and its Subsidiaries or a business reasonably related
thereto,

i.the assets being acquired (other than a de minimis amount of assets in
relation to the assets being acquired) are located within the United States or
the Person whose Stock is being acquired is organized in a jurisdiction located
within the United States,

j.the subject assets or Stock, as applicable, are being acquired directly by
Borrower or a Loan Party, and, in connection therewith, Borrower or the
applicable Loan Party shall have complied with Section 5.11 or 5.12, as
applicable, of the Agreement and, in the case of an acquisition of Stock,
Borrower or the applicable Loan Party shall have demonstrated to Agent that the
new Loan Parties have received consideration sufficient to make the joinder
documents binding and enforceable against such new Loan Parties, and

k.the purchase consideration payable in respect of all Permitted Acquisitions
(including the proposed Acquisition and including deferred payment obligations)
shall not exceed $15,000,000 in the aggregate; provided, however, that the
purchase consideration payable in respect of any single Acquisition or series of
related Acquisitions shall not exceed $5,000,000 in the aggregate.

“Permitted Discretion” means a determination made in the exercise of reasonable
(from the perspective of a secured lender) business judgment.
“Permitted Dispositions” means:
a.sales, abandonment, or other dispositions of Equipment that is substantially
worn, damaged, no longer useful, or obsolete in the ordinary course of business,

b.sales of Inventory to buyers in the ordinary course of business,

c.the use or transfer of money or Cash Equivalents in a manner that is not
prohibited by the terms of the Agreement or the other Loan Documents,

d.termination of a lease of real or personal property that is not necessary for
the ordinary course of business and does not result from a Loan Party's default,

e.the granting of Permitted Liens,

f.the sale or discount, in each case without recourse, of Accounts arising in
the ordinary course of business, but only in connection with the compromise or
collection thereof,

g.any involuntary loss, damage or destruction of property,

h.any involuntary condemnation, seizure or taking, by exercise of the power of
eminent domain or otherwise, or confiscation or requisition of use of property,

i.the leasing or subleasing of assets of Borrower or its Subsidiaries in the
ordinary course of business,

j.the sale or issuance of Stock (other than Prohibited Preferred Stock) of
Borrower,

k.[reserved],

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l.the making of a Restricted Junior Payment that is expressly permitted to be
made pursuant to the Agreement,

m.the making of a Permitted Investment,

n.dispositions of assets acquired by Borrower and its Subsidiaries pursuant to a
Permitted Acquisition consummated within 12 months of the date of the proposed
Disposition (the “Subject Permitted Acquisition”) so long as (i) the
consideration received for the assets to be so disposed is at least equal to the
fair market value thereof, (ii) the assets to be so disposed are not necessary
or economically desirable in connection with the business of Borrower and its
Subsidiaries, and (iii) the assets to be so disposed are readily identifiable as
assets acquired pursuant to the Subject Permitted Acquisition,

o.a Permitted IP Disposition,

p.the sale of any Purchased Assets or Purchased Receivables pursuant to the
Walmart Receivables Purchase Agreement, and

q.dispositions of assets (other than Accounts, Intellectual Property, licenses,
Stock of Subsidiaries of Borrower, or Designated Contracts) not otherwise
permitted in clauses (a) through (p) above so long as made at fair market value
and the aggregate fair market value of all assets disposed of in all such
dispositions since the Closing Date (including the proposed disposition) would
not exceed $5,000,000 per fiscal year.

“Permitted Indebtedness” means:
a.Indebtedness evidenced by the Agreement or the other Loan Documents, as well
as Indebtedness owed to Underlying Issuers with respect to Underlying Letters of
Credit,

b.Indebtedness set forth on Schedule 4.19 and any Refinancing Indebtedness in
respect of such Indebtedness,

c.Permitted Purchase Money Indebtedness and any Refinancing Indebtedness in
respect of such Indebtedness,

d.endorsement of instruments or other payment items for deposit,

e.Indebtedness consisting of (i) unsecured guarantees incurred in the ordinary
course of business with respect to surety and appeal bonds, performance bonds,
bid bonds, appeal bonds, completion guarantee and similar obligations; (ii)
unsecured guarantees arising with respect to customary indemnification
obligations to purchasers in connection with Permitted Dispositions; and (iii)
unsecured guarantees with respect to Indebtedness of Borrower or one of its
Subsidiaries, to the extent that the Person that is obligated under such
guaranty could have incurred such underlying Indebtedness,

f.unsecured Indebtedness of Borrower that is incurred on the date of the
consummation of a Permitted Acquisition solely for the purpose of consummating
such Permitted Acquisition so long as (i) no Event of Default has occurred and
is continuing or would result therefrom, (ii) such unsecured Indebtedness is not
incurred for working capital purposes, (iii) such unsecured Indebtedness does
not mature prior to the date that is 12 months after the Maturity Date, (iv)
such Indebtedness is subordinated in right of payment to the Obligations on
terms and conditions reasonably satisfactory to Agent, and (v) the only interest
that accrues with respect to such Indebtedness is payable in kind,

g.Acquired Indebtedness in an amount not to exceed $1,000,000 outstanding at any
one time,

h.Indebtedness (including unsecured guarantees) incurred in the ordinary course
of business under performance, surety, statutory, and appeal bonds,

i.Indebtedness owed to any Person providing property, casualty, liability, or
other insurance to Borrower or any of its Subsidiaries, so long as the amount of
such Indebtedness is not in excess of the amount of the unpaid cost of, and
shall be incurred only to defer the cost of, such insurance for the year in
which such Indebtedness is incurred and such Indebtedness is outstanding only
during such year,

j.the incurrence by Borrower or its Subsidiaries of Indebtedness under Hedge
Agreements that are incurred for the bona fide purpose of hedging the interest
rate, commodity, or foreign currency risks associated with Borrower's and its
Subsidiaries' operations and not for speculative purposes,

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k.Indebtedness incurred in respect of credit cards, credit card processing
services, debit cards, stored value cards, purchase cards (including so-called
“procurement cards” or “P-cards”), or Cash Management Services, in each case,
incurred in the ordinary course of business,

l.unsecured Indebtedness of Borrower owing to former employees, officers, or
directors (or any spouses, ex-spouses, or estates of any of the foregoing)
incurred in connection with the repurchase by Borrower of the Stock of Borrower
that has been issued to such Persons, so long as (i) no Default or Event of
Default has occurred and is continuing or would result from the incurrence of
such Indebtedness, (ii) the aggregate amount of all such Indebtedness
outstanding at any one time does not exceed $500,000, and (iii) such
Indebtedness is subordinated to the Obligations on terms and conditions
reasonably acceptable to Agent,

m.unsecured Indebtedness owing to sellers of assets or Stock to a Loan Party
that is incurred by the applicable Loan Party in connection with the
consummation of one or more Permitted Acquisitions so long as (i) the aggregate
principal amount for all such unsecured Indebtedness does not exceed $500,000 at
any one time outstanding, (ii) is subordinated to the Obligations on terms and
conditions reasonably acceptable to Agent, and (iii) is otherwise on terms and
conditions (including all economic terms and the absence of covenants)
reasonably acceptable to Agent,

n.contingent liabilities in respect of any indemnification obligation,
adjustment of purchase price, non-compete, or similar obligation of Borrower or
the applicable Loan Party incurred in connection with the consummation of one or
more Permitted Acquisitions,

o.Indebtedness composing Permitted Investments, and

p.unsecured Indebtedness of Borrower owing under the Convertible Senior Notes.
“Permitted Intercompany Advances” means loans made by (a) a Loan Party to
another Loan Party, (b) a non-Loan Party to another non-Loan Party, and (c) a
non-Loan Party to a Loan Party, so long as the parties thereto are party to the
Intercompany Subordination Agreement.
“Permitted Investments” means:
a.Investments in cash and Cash Equivalents,

b.Investments in negotiable instruments deposited or to be deposited for
collection in the ordinary course of business,

c.advances in the ordinary course of business (i) made to publishers of
Intellectual Property utilized or developed by or on behalf of, or at the
direction of, Borrower or the Loan Parties in an amount not to exceed
$10,000,000 for any single advance or $20,000,000 in the aggregate at any time,
(ii) made to licensors of Intellectual Property utilized by or on behalf of, or
at the direction of, Borrower or the Loan Parties in an amount not to exceed
$25,000,000 for any single advance or $150,000,000 in the aggregate at any time,
(iii) made to developers of Intellectual Property developed by or on behalf of,
or at the direction of Borrower or the Loan Parties in an amount not to exceed
$35,000,000 in the aggregate, and (iv) to the extent not constituting an advance
to publishers, licensors, or developers of Intellectual Property, made in
connection with purchases of goods or services,

d.Investments received in settlement of amounts due to any Loan Party or any of
its Subsidiaries effected in the ordinary course of business or owing to any
Loan Party or any of its Subsidiaries as a result of Insolvency Proceedings
involving an Account Debtor or upon the foreclosure or enforcement of any Lien
in favor of a Loan Party or its Subsidiaries,

e.Investments owned by any Loan Party or any of its Subsidiaries on the Closing
Date and set forth on Schedule P-1,

f.guarantees permitted under the definition of Permitted Indebtedness,

g.Permitted Intercompany Advances,

h.Stock or other securities acquired in connection with the satisfaction or
enforcement of Indebtedness or claims due or owing to a Loan Party or its
Subsidiaries (in bankruptcy of customers or suppliers or otherwise outside the
ordinary course of business) or as security for any such Indebtedness or claims,

i.deposits of cash made in the ordinary course of business to secure performance
of operating leases,

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j.non-cash loans to employees, officers, and directors of Borrower or any of its
Subsidiaries for the purpose of purchasing Stock in Borrower so long as the
proceeds of such loans are used in their entirety to purchase such stock in
Borrower,

k.Permitted Acquisitions,

l.Investments in the form of capital contributions and the acquisition of Stock
made by any Loan Party in any other Loan Party (other than capital contributions
to or the acquisition of Stock of Borrower),

m.Investments resulting from entering into (i) Bank Product Agreements, or (ii)
agreements relative to Indebtedness that is permitted under clause (j) of the
definition of Permitted Indebtedness,

n.Investments held by a Person acquired in a Permitted Acquisition to the extent
that such Investments were not made in contemplation of or in connection with
such Permitted Acquisition and were in existence on the date of such Permitted
Acquisition, and

o.so long as no Event of Default has occurred and is continuing or would result
therefrom, any other Investments in an aggregate amount not to exceed $500,000
during the term of the Agreement.

p.“Permitted IP Disposition” means a sale, assignment, transfer, abandonment,
termination, relinquishment, non-renewal or other disposition of any
Intellectual Property owned or used in the conduct of Borrower's or a Loan
Party's business, (a) that is “shrink wrap” or similar widely distributed
commercially licensed software or other Intellectual Property available at a
cost of less than $50,000; (b) that is not Material IP; (c) up to $10,000,000 of
Intellectual Property in the aggregate that, in the reasonable business judgment
of the officers of such Borrower or Loan Party, is no longer desirable in the
conduct of the business of such Borrower or Loan Party; (d) that is
non-exclusive (or exclusive in the case of non-video game media platforms)
licensing or sublicensing of Intellectual Property of Borrower or its
Subsidiaries in the ordinary course of business consistent with past practices,
or (e) that is approved in writing by Agent and Required Lenders.

“Permitted Liens” means
a.Liens granted to, or for the benefit of, Agent to secure the Obligations,

b.Liens for unpaid taxes, assessments, or other governmental charges or levies
that either (i) are not yet delinquent, or (ii) do not have priority over
Agent's Liens and the underlying taxes, assessments, or charges or levies are
the subject of Permitted Protests,

c.judgment Liens arising solely as a result of the existence of judgments,
orders, or awards that do not constitute an Event of Default under Section 8.3
of the Agreement,

d.Liens set forth on Schedule P-2; provided, however, that to qualify as a
Permitted Lien, any such Lien described on Schedule P-2 shall only secure the
Indebtedness that it secures on the Closing Date and any Refinancing
Indebtedness in respect thereof,

e.the interests of lessors under operating leases and licensors under license
agreements,

f.purchase money Liens or the interests of lessors under Capital Leases to the
extent that such Liens or interests secure Permitted Purchase Money Indebtedness
and so long as (i) such Lien attaches only to the asset purchased or acquired
and the proceeds thereof, and (ii) such Lien only secures the Indebtedness that
was incurred to acquire the asset purchased or acquired or any Refinancing
Indebtedness in respect thereof,

g.Liens arising by operation of law in favor of warehousemen, landlords,
carriers, mechanics, materialmen, laborers, or suppliers, incurred in the
ordinary course of business and not in connection with the borrowing of money,
and which Liens either (i) are for sums not yet delinquent, or (ii) are the
subject of Permitted Protests,

h.Liens on amounts deposited to secure Borrower's and its Subsidiaries'
obligations in connection with worker's compensation or other unemployment
insurance,

i.Liens on amounts deposited to secure Borrower's and its Subsidiaries'
obligations in connection with the making or entering into of bids, tenders, or
leases in the ordinary course of business and not in connection with the
borrowing of money,

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j.Liens on amounts deposited to secure Borrower's and its Subsidiaries'
reimbursement obligations with respect to surety or appeal bonds obtained in the
ordinary course of business,

k.with respect to any Real Property, easements, rights of way, and zoning
restrictions that do not materially interfere with or impair the use or
operation thereof,

l.non-exclusive licenses of patents, trademarks, copyrights, and other
intellectual property rights in the ordinary course of business,

m.Liens that are replacements of Permitted Liens to the extent that the original
Indebtedness is the subject of permitted Refinancing Indebtedness and so long as
the replacement Liens only encumber those assets that secured the original
Indebtedness,

n.rights of setoff or bankers' liens upon deposits of cash in favor of banks or
other depository institutions, solely to the extent incurred in connection with
the maintenance of such deposit accounts in the ordinary course of business,

o.Liens granted in the ordinary course of business on the unearned portion of
insurance premiums securing the financing of insurance premiums to the extent
the financing is permitted under the definition of Permitted Indebtedness,

p.Liens in favor of customs and revenue authorities arising as a matter of law
to secure payment of customs duties in connection with the importation of goods,

q.Liens solely on any cash earnest money deposits made by Borrower or any of its
Subsidiaries in connection with any letter of intent or purchase agreement with
respect to a Permitted Acquisition,

r.Liens assumed by Borrower or its Subsidiaries in connection with a Permitted
Acquisition that secure Acquired Indebtedness, and

s.other Liens which do not secure Indebtedness for borrowed money or letters of
credit and as to which the aggregate amount of the obligations secured thereby
does not exceed $500,000.

“Permitted Preferred Stock” means and refers to any Preferred Stock issued by
Borrower (and not by one or more of its Subsidiaries) that is not Prohibited
Preferred Stock.
“Permitted Protest” means the right of Borrower or any of its Subsidiaries to
protest any Lien (other than any Lien that secures the Obligations), taxes
(other than payroll taxes or taxes that are the subject of a United States
federal tax lien), or rental payment, provided that (a) a reserve with respect
to such obligation is established on Borrower's or its Subsidiaries' books and
records in such amount as is required under GAAP, (b) any such protest is
instituted promptly and prosecuted diligently by Borrower or its Subsidiary, as
applicable, in good faith, and (c) Agent is satisfied that, while any such
protest is pending, there will be no impairment of the enforceability, validity,
or priority of any of Agent's Liens.
“Permitted Purchase Money Indebtedness” means, as of any date of determination,
Purchase Money Indebtedness incurred after the Closing Date in an aggregate
principal amount outstanding at any one time not in excess of $1,000,000.
“Person” means natural persons, corporations, limited liability companies,
limited partnerships, general partnerships, limited liability partnerships,
joint ventures, trusts, land trusts, business trusts, or other organizations,
irrespective of whether they are legal entities, and governments and agencies
and political subdivisions thereof.
“Preferred Stock” means, as applied to the Stock of any Person, the Stock of any
class or classes (however designated) that is preferred with respect to the
payment of dividends, or as to the distribution of assets upon any voluntary or
involuntary liquidation or dissolution of such Person, over shares of Stock of
any other class of such Person.
“Prepayment” has the meaning set forth in Section 2.10(d) of the Agreement.
“Prohibited Preferred Stock” means any Preferred Stock that by its terms is
mandatorily redeemable or subject to any other payment obligation (including any
obligation to pay dividends, other than dividends of shares of Preferred Stock
of the same class and series payable in kind or dividends of shares of common
stock) on or before a date that is less than 1 year after the Maturity Date, or,
on or before the date that is less than 1 year after the Maturity Date, is
redeemable at the option of the holder thereof for cash or assets or securities
(other than distributions in kind of shares of Preferred Stock of the same class
and series or

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of shares of common stock).
“Projections” means Borrower's forecasted (a) balance sheets, (b) profit and
loss statements, and (c) cash flow statements, all prepared on a basis
consistent with Borrower's historical financial statements, together with
appropriate supporting details and a statement of underlying assumptions.
“Pro Rata Share” means, as of any date of determination:
a.with respect to a Lender's obligation to make Advances and right to receive
payments of principal, interest, fees, costs, and expenses with respect thereto,
(i) prior to the Revolver Commitments being terminated or reduced to zero, the
percentage obtained by dividing (y) such Lender's Revolver Commitment, by (z)
the aggregate Revolver Commitments of all Lenders, and (ii) from and after the
time that the Revolver Commitments have been terminated or reduced to zero, the
percentage obtained by dividing (y) the outstanding principal amount of such
Lender's Advances by (z) the outstanding principal amount of all Advances,

b.with respect to a Lender's obligation to participate in Letters of Credit and
Reimbursement Undertakings, to reimburse the Issuing Lender, and right to
receive payments of fees with respect thereto, (i) prior to the Revolver
Commitments being terminated or reduced to zero, the percentage obtained by
dividing (y) such Lender's Revolver Commitment, by (z) the aggregate Revolver
Commitments of all Lenders, and (ii) from and after the time that the Revolver
Commitments have been terminated or reduced to zero, the percentage obtained by
dividing (y) the outstanding principal amount of such Lender's Advances by (z)
the outstanding principal amount of all Advances; provided, however, that if all
of the Advances have been repaid in full and Letters of Credit remain
outstanding, Pro Rata Share under this clause shall be determined based upon
subclause (i) of this clause as if the Revolver Commitments had not been
terminated or reduced to zero and based upon the Revolver Commitments as they
existed immediately prior to their termination or reduction to zero,

c.[reserved], and

d.with respect to all other matters as to a particular Lender (including the
indemnification obligations arising under Section 15.7 of the Agreement), (i)
prior to the Revolver Commitments being terminated or reduced to zero, the
percentage obtained by dividing (y) such Lender's Revolver Commitment, by (z)
the aggregate amount of Revolver Commitments of all Lenders, and (ii) from and
after the time that the Revolver Commitments have been terminated or reduced to
zero, the percentage obtained by dividing (y) the outstanding principal amount
of such Lender's Advances, by (z) the outstanding principal amount of all
Advances; provided, however, that if all of the Advances have been repaid in
full and Letters of Credit remain outstanding, Pro Rata Share under this clause
shall be determined based upon subclause (i) of this clause as if the Revolver
Commitments had not been terminated or reduced to zero and based upon the
Revolver Commitments as they existed immediately prior to their termination or
reduction to zero.

“Protective Advances” has the meaning specified therefor in Section 2.3(d)(i) of
the Agreement.
“PTO” has the meaning specified therefor in the Security Agreement.
“Purchase Money Indebtedness” means Indebtedness (other than the Obligations,
but including Capitalized Lease Obligations), incurred at the time of, or within
20 days after, the acquisition of any fixed assets for the purpose of financing
all or any part of the acquisition cost thereof.
“Purchase Price” means, with respect to any Acquisition, an amount equal to the
aggregate consideration, whether cash, property or securities (including the
fair market value of any Stock of Borrower issued in connection with such
Acquisition and including the maximum amount of Earn-Outs), paid or delivered by
Borrower or one of its Subsidiaries in connection with such Acquisition (whether
paid at the closing thereof or payable thereafter and whether fixed or
contingent), but excluding therefrom (a) any cash of the seller and its
Affiliates used to fund any portion of such consideration and (b) any cash or
Cash Equivalents acquired in connection with such Acquisition.
“Purchased Assets” has the meaning ascribed to that term in the Walmart
Receivables Purchase Agreement as in effect on November 3, 2010.
“Purchased Receivables” has the meaning ascribed to that term in the Walmart
Receivables Purchase Agreement as in effect on November 3, 2010.
“Qualified Cash” means, as of any date of determination, the amount of
unrestricted cash and Cash Equivalents of Borrower and the other Loan Parties
that is in Deposit Accounts or in Securities Accounts, or any combination
thereof, and which

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such Deposit Account or Securities Account is the subject of a Control Agreement
and is maintained by a branch office of the bank or securities intermediary
located within the United States.
“Real Property” means any estates or interests in real property now owned or
hereafter acquired by Borrower or a Loan Party and the improvements thereto.
“Real Property Collateral” means the Real Property identified on Schedule R-1
and any Real Property hereafter acquired by Borrower or its Subsidiaries.
“Record” means information that is inscribed on a tangible medium or that is
stored in an electronic or other medium and is retrievable in perceivable form.
“Refinancing Indebtedness” means refinancings, renewals, or extensions of
Indebtedness so long as:
a.such refinancings, renewals, or extensions do not result in an increase in the
principal amount of the Indebtedness so refinanced, renewed, or extended, other
than by the amount of premiums paid thereon and the fees and expenses incurred
in connection therewith and by the amount of unfunded commitments with respect
thereto,

b.such refinancings, renewals, or extensions do not result in a shortening of
the average weighted maturity (measured as of the refinancing, renewal, or
extension) of the Indebtedness so refinanced, renewed, or extended, nor are they
on terms or conditions that, taken as a whole, are or could reasonably be
expected to be materially adverse to the interests of the Lenders,

c.if the Indebtedness that is refinanced, renewed, or extended was subordinated
in right of payment to the Obligations, then the terms and conditions of the
refinancing, renewal, or extension must include subordination terms and
conditions that are at least as favorable to the Lender Group as those that were
applicable to the refinanced, renewed, or extended Indebtedness, and

d.the Indebtedness that is refinanced, renewed, or extended is not recourse to
any Person that is liable on account of the Obligations other than those Persons
which were obligated with respect to the Indebtedness that was refinanced,
renewed, or extended.

“Register” has the meaning set forth in Section 13.1(h) of the Agreement.
“Registered Loan” has the meaning set forth in Section 13.1(h) of the Agreement.
“Reimbursement Undertaking” has the meaning specified therefor in Section
2.11(a) of the Agreement.
“Related Fund” means, with respect to any Lender that is an investment fund, any
other investment fund that invests in commercial loans and that is managed or
advised by the same investment advisor as such Lender or by an Affiliate of such
investment advisor.
“Remedial Action” means all actions taken to (a) clean up, remove, remediate,
contain, treat, monitor, assess, evaluate, or in any way address Hazardous
Materials in the indoor or outdoor environment, (b) prevent or minimize a
release or threatened release of Hazardous Materials so they do not migrate or
endanger or threaten to endanger public health or welfare or the indoor or
outdoor environment, (c) restore or reclaim natural resources or the
environment, (d) perform any pre-remedial studies, investigations, or
post-remedial operation and maintenance activities, or (e) conduct any other
actions with respect to Hazardous Materials required by Environmental Laws.
“Replacement Lender” has the meaning specified therefor in Section 2.13(b) of
the Agreement.
“Report” has the meaning specified therefor in Section 15.16 of the Agreement.
“Required Availability” means that the sum of (a) Excess Availability, plus (b)
Qualified Cash exceeds $15,000,000.
“Required Lenders” means, at any time, Lenders whose aggregate Pro Rata Shares
(calculated under clause (d) of the definition of Pro Rata Shares) exceed 50%;
provided, however, that at any time there are 2 or more Lenders, “Required
Lenders” must include at least 2 Lenders.
“Required Library” has the meaning specified therefor in the Security Agreement.

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“Restricted Junior Payment” means to (a) declare or pay any dividend or make any
other payment or distribution on account of Stock issued by Borrower (including
any payment in connection with any merger or consolidation involving Borrower)
or to the direct or indirect holders of Stock issued by Borrower in their
capacity as such (other than dividends or distributions payable in Stock (other
than Prohibited Preferred Stock) issued by Borrower, or (b) purchase, redeem, or
otherwise acquire or retire for value (including in connection with any merger
or consolidation involving Borrower) any Stock issued by Borrower.
“Revolver Commitment” means, with respect to each Lender, its Revolver
Commitment, and, with respect to all Lenders, their Revolver Commitments, in
each case as such Dollar amounts are set forth beside such Lender's name under
the applicable heading on Schedule C-1 or in the Assignment and Acceptance
pursuant to which such Lender became a Lender under the Agreement, as such
amounts may be reduced or increased from time to time pursuant to assignments
made in accordance with the provisions of Section 13.1 of the Agreement.
“Revolver Note” means any promissory note executed by Borrower in favor of a
Lender, which shall be in the amount of such Lender's Revolver Commitment and
shall evidence loans made by such Lender.
“Revolver Usage” means, as of any date of determination, the sum of (a) the
amount of outstanding Advances, plus (b) the amount of the Letter of Credit
Usage.
“Royalties” means all royalties, fees, expense reimbursement and other amounts
payable by Borrower or any Loan Party under an Intellectual Property License.
“Sanctioned Entity” means (a) a country or a government of a country, (b) an
agency of the government of a country, (c) an organization directly or
indirectly controlled by a country or its government, (d) a Person resident in
or determined to be resident in a country, in each case, that is subject to a
country sanctions program administered and enforced by OFAC.
“Sanctioned Person” means a person named on the list of Specially Designated
Nationals maintained by OFAC.
“S&P” has the meaning specified therefor in the definition of Cash Equivalents.
“SEC” means the United States Securities and Exchange Commission and any
successor thereto.
“Securities Account” means a securities account (as that term is defined in the
Code).
“Securities Act” means the Securities Act of 1933, as amended from time to time,
and any successor statute.
“Security Agreement” means a security agreement, dated as of even date with the
Agreement, in form and substance reasonably satisfactory to Agent, executed and
delivered by Borrower and Guarantors to Agent.
“Settlement” has the meaning specified therefor in Section 2.3(e)(i) of the
Agreement.
“Settlement Date” has the meaning specified therefor in Section 2.3(e)(i) of the
Agreement.
“Solvent” means, with respect to any Person on a particular date, that, at fair
valuations, the sum of such Person's assets is greater than all of such Person's
debts.
“Stock” means all shares, options, warrants, interests, participations, or other
equivalents (regardless of how designated) of or in a Person, whether voting or
nonvoting, including common stock, preferred stock, or any other “equity
security” (as such term is defined in Rule 3a11-1 of the General Rules and
Regulations promulgated by the SEC under the Exchange Act).
“Subsidiary” of a Person means a corporation, partnership, limited liability
company, or other entity in which that Person directly or indirectly owns or
controls the shares of Stock having ordinary voting power to elect a majority of
the board of directors (or appoint other comparable managers) of such
corporation, partnership, limited liability company, or other entity.
“Swing Lender” means WFCF or any other Lender that, at the request of Borrower
and with the consent of Agent agrees, in such Lender's sole discretion, to
become the Swing Lender under Section 2.3(b) of the Agreement.
“Swing Loan” has the meaning specified therefor in Section 2.3(b) of the
Agreement.
“Taxes” means any taxes, levies, imposts, duties, fees, assessments or other
charges of whatever nature now or hereafter

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imposed by any jurisdiction or by any political subdivision or taxing authority
thereof or therein with respect to such payments and all interest, penalties or
similar liabilities with respect thereto; provided, however, that Taxes shall
exclude (i) any tax imposed on the net income or net profits of any Lender or
any Participant (including any branch profits taxes), in each case imposed by
the jurisdiction (or by any political subdivision or taxing authority thereof)
in which such Lender or such Participant is organized or the jurisdiction (or by
any political subdivision or taxing authority thereof) in which such Lender's or
such Participant's principal office is located in each case as a result of a
present or former connection between such Lender or such Participant and the
jurisdiction or taxing authority imposing the tax (other than any such
connection arising solely from such Lender or such Participant having executed,
delivered or performed its obligations or received payment under, or enforced
its rights or remedies under the Agreement or any other Loan Document); (ii)
taxes resulting from a Lender's or a Participant's failure to comply with the
requirements of Section 16(c) or (d) of the Agreement, and (iii) any United
States federal withholding taxes that would be imposed on amounts payable to a
Foreign Lender based upon the applicable withholding rate in effect at the time
such Foreign Lender becomes a party to the Agreement (or designates a new
lending office), except that Taxes shall include (A) any amount that such
Foreign Lender (or its assignor, if any) was previously entitled to receive
pursuant to Section 16(a) of the Agreement, if any, with respect to such
withholding tax at the time such Foreign Lender becomes a party to the Agreement
(or designates a new lending office), and (B) additional United States federal
withholding taxes that may be imposed after the time such Foreign Lender becomes
a party to the Agreement (or designates a new lending office), as a result of a
change in law, rule, regulation, order or other decision with respect to any of
the foregoing by any Governmental Authority.
“Tax Lender” has the meaning specified therefor in Section 14.2(a) of the
Agreement.
“Technicolor” means collectively, Technicolor Home Entertainment Services, Inc.,
a Delaware corporation, Technicolor Videocassette of Michigan, Inc., a Delaware
corporation, and Technicolor Disc Services International Limited, a company
organized under the laws of England and Wales and any of their Affiliates.
“Total Commitment” means, with respect to each Lender, its Total Commitment,
and, with respect to all Lenders, their Total Commitments, in each case as such
Dollar amounts are set forth beside such Lender's name under the applicable
heading on Schedule C-1 attached hereto or on the signature page of the
Assignment and Acceptance pursuant to which such Lender became a Lender under
the Agreement, as such amounts may be reduced or increased from time to time
pursuant to assignments made in accordance with the provisions of Section 13.1
of the Agreement.
“Trademark” has the meaning specified therefor in the Security Agreement.
“Trademark Security Agreement” has the meaning specified therefor in the
Security Agreement.
“Trigger Event” means, as of any date, that (a) an Event of Default has occurred
and is continuing as of such date or (b) Excess Availability on such date is
below 12.5% of the Maximum Revolver Amount.
“Trigger Period” means a period which shall (a) commence on a Trigger Event and
continue until the date on which (1) if the relevant Trigger Event is caused by
an Event of Default, such Event of Default no longer exists, or (2) Excess
Availability has been greater than or equal to 12.5% of the Maximum Revolver
Amount for a period of 90 consecutive days following the date of the Trigger
Event and no Event of Default is then continuing.
“Underlying Issuer” means Wells Fargo or one of its Affiliates.
“Underlying Letter of Credit” means a Letter of Credit that has been issued by
an Underlying Issuer.
“United States” means the United States of America.
“USCO” has the meaning specified therefor in the Security Agreement.
“Voidable Transfer” has the meaning specified therefor in Section 17.8 of the
Agreement.
“Walmart Receivables Purchase Agreement” means that certain Receivables Purchase
Agreement dated November 3, 2010 between Borrower and Wells Fargo.
“Wells Fargo” means Wells Fargo Bank, National Association, a national banking
association.
“WFCF” means Wells Fargo Capital Finance, LLC, a Delaware limited liability
company.