Exhibit 10.1

EXECUTION COPY

LETTER OF CREDIT COMMITMENT AND REIMBURSEMENT AGREEMENT

                    THIS LETTER OF CREDIT COMMITMENT AND REIMBURSEMENT AGREEMENT
(this “Agreement”), dated as of June 11, 2009 (“Closing Date”), is entered into
by and among MTM TECHNOLOGIES, INC., a New York corporation (“MTM”), MTM
TECHNOLOGIES (US), INC., a Delaware corporation (“MTM-US”), MTM TECHNOLOGIES
(MASSACHUSETTS), LLC, a Delaware limited liability company (“MTM-MA”), and INFO
SYSTEMS, INC., a Delaware corporation (“ISI”; MTM, MTM-US, MTM-MA, and ISI are
collectively, the “Borrowers” and each a “Borrower”); NATIONAL ELECTRICAL
BENEFIT FUND (“NEBF”), FIRSTMARK III L.P. (f/k/a Pequot Private Equity Fund III,
L.P.) (“FMIII”), FIRSTMARK III OFFSHORE PARTNERS, L.P. (f/k/a Pequot Offshore
Private Equity Partners III, L.P.) (“FMIIIOP”), CONSTELLATION VENTURE CAPITAL
II, L.P. (“CVCII”), CONSTELLATION VENTURE CAPITAL OFFSHORE II, L.P. (“CVCOII”),
CVC II PARTNERS, LLC (“CVCIIP”), and THE BSC EMPLOYEE FUND VI, L.P. (“BSC”;
NEBF, FMIII, FMIIIOP, CVCII, CVCOII, CVCIIP, and BSC are collectively, the “L/C
Guarantors” and each a “L/C Guarantor”); and COLUMBIA PARTNERS, L.L.C.
INVESTMENT MANAGEMENT, as Investment Manager for the L/C Guarantors (“Investment
Manager”).

RECITALS

          A. The Borrowers, GE Commercial Distribution Finance Corporation, as
administrative agent to the lenders (“CDF”), certain lenders and other entities
are parties to that certain Credit Facilities Agreement (the “CDF Agreement”)
pursuant to which certain lenders have made and shall continue to make credit
available to the Borrowers.

          B. As a condition to CDF continuing to make advances under the CDF
Agreement, CDF requires that the L/C Guarantors provide letters of credit in the
aggregate amount of $8,500,000 to provide credit support and additional
collateral to secure the Borrowers’ obligations under the CDF Agreement.

          C. The L/C Guarantors are willing to cause to be issued for the
benefit of CDF certain letters of credit (the “Letters of Credit”) in an
aggregate amount of $8,500,000, and the Borrowers are willing to enter into this
Agreement with respect to the Borrowers’ payment and reimbursement obligations
in connection with the Letters of Credit.

          D. This Agreement sets forth the terms under which all Letters of
Credit are to be issued and reimbursed unless otherwise specified.

          E. All capitalized terms herein shall have the meanings ascribed
thereto in Annex A hereto which is incorporated herein by reference.

AGREEMENT

          NOW, THEREFORE, Investment Manager, the L/C Guarantors and the
Borrowers agree as follows:

1. LETTERS OF CREDIT COMMITMENT.

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          1.1 Letters of Credit Commitment. The L/C Guarantors agree, on the
terms and conditions hereinafter set forth, to cause to be issued Letters of
Credit, in form reasonably acceptable to CDF and the Borrowers for the benefit
of CDF, in the amounts as set forth opposite the names of each L/C Guarantor on
Schedule of L/Cs attached hereto, which equal an aggregate face amount of
$8,500,000 (the “Letters of Credit Limit”).

          1.2 Issuance of Letters of Credit. The L/C Guarantors will cause to be
issued the Letters of Credit, in the amounts set forth on the Schedule of L/Cs,
on the Closing Date (the “Closing”). The Letters of Credit shall not have expiry
dates later than May 31, 2010 and shall not have face amounts in aggregate no
more than or less than the Letters of Credit Limit. If the Borrowers satisfy all
of their Loan Obligations (as defined in the CDF Agreement) in respect of the
CDF Agreement, within three (3) Business Days of the termination of the CDF
Agreement the Borrowers will cause CDF to return the Letters of Credit to each
issuing bank for cancellation. Notwithstanding the foregoing, in the event the
Borrowers satisfy their Loan Obligations in respect of the CDF Agreement, the
Borrowers’ Obligations under this Agreement shall remain and survive the
cancellation of the Letters of Credit and shall terminate only on the
Termination Date, upon the indefeasible payment of all Fees and expenses due
hereunder. Notwithstanding any provision of this Agreement to the contrary, the
L/C Guarantors shall have no obligation to cause any additional Letters of
Credit to be issued after the Closing Date.

2. REIMBURSEMENT; OBLIGATIONS; AND SECURITY.

          2.1 Reimbursement Obligation. The Borrowers shall reimburse the L/C
Guarantors for any payment made on a Letter of Credit (a “Drawing”) by making
(or causing to be made) to the L/C Guarantors a payment in the amount of such
Drawing (the “Reimbursement Payment”) immediately following any payment made on
such Letter of Credit by the issuing bank of such Letter of Credit.

          2.2 Fees. In consideration of the L/C Guarantors entering into this
Agreement:

               (a) Facility Fee. The Borrowers shall pay the L/C Guarantors an
aggregate facility fee (the “Facility Fee”) in cash equal to $170,000.00 on the
Closing Date (for the purpose of reimbursing the L/C Guarantors for the fees
charged by the Letters of Credit issuing banks), such fee is to be paid to the
L/C Guarantors on a pro rata basis in accordance with each L/C Guarantor’s
commitment amount, as specified on the Schedule of L/Cs.

               (b) Success Fee. In consideration of the L/C Guarantors entering
into this Agreement, the Borrowers shall pay the L/C Guarantors a success fee
(the “Success Fee”) in cash equal to four times (4x) the Letters of Credit Limit
(or $34,000,000.00), such fee is to be paid to the L/C Guarantors on a pro rata
basis in accordance with each L/C Guarantor’s Letter of Credit amount, as
specified on the Schedule of L/Cs, and the Success Fee shall be immediately due
and payable upon the occurrence of a Change of Control, an Event of Default, or
a Liquidity Event.

               (c) Drawing Fee. The Borrowers shall also pay the L/C Guarantors,
in addition to all other amounts due hereunder, a drawing fee (the “Drawing
Fee”) equal to the amount required to provide the L/C Guarantors with an IRR on
any Drawing of fifteen percent (15%) per annum. Such drawing fee shall be due
within three (3) Business Days after the date of a Drawing and is to be paid to
the L/C Guarantors on a pro rata basis in accordance with each L/C Guarantor’s
commitment amount, as specified on the Schedule of L/Cs.

          2.3 Expenses; Other Fees; and Attorneys Fees. The Borrowers agree to
pay or reimburse

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Investment Manager and the L/C Guarantors for: (a) all costs, expenses and other
charges in respect of any lien, tax and judgment searches performed by a service
firm, to be chosen by Investment Manager in its sole discretion, in connection
with the transactions contemplated by the Loan Documents and other collateral
searches and filings; (b) all costs and expenses of Investment Manager and the
L/C Guarantors, including the legal fees and disbursements, incurred in
connection with the negotiation, preparation, execution and delivery of this
Agreement and the other Loan Documents and the other instruments and agreements
entered into pursuant hereto and thereto; (c) all reasonable out-of-pocket costs
and expenses of Investment Manager and the L/C Guarantors including the fees and
disbursements of counsel for Investment Manager and the L/C Guarantors, incurred
in connection with the negotiation, preparation, execution and delivery of any
modification, supplement or waiver of this Agreement and any other Loan
Documents (whether or not consummated); (d) all expenses of Investment Manager
and the L/C Guarantors including the fees and disbursements of counsel for
Investment Manager and the L/C Guarantors in connection with (1) any Default or
Event of Default and any enforcement or collection proceedings resulting
therefrom, including, without limitation, all manner of participation in or
other involvement with (A) bankruptcy, insolvency, receivership, foreclosure,
winding up or liquidation proceedings, (B) judicial or regulatory proceedings
and (C) workout, restructuring or other negotiations or proceedings (whether or
not the workout, restructuring or transaction contemplated thereby is
consummated) and (2) the enforcement of this Section 2.3; (e) all transfer,
stamp, documentary or other similar taxes, assessments or charges levied by any
governmental or revenue authority in respect of this Agreement or any of the
other Loan Documents or any other document referred to herein or therein and all
costs, expenses, taxes, assessments and other charges incurred in connection
with any filing, registration, recording or perfection of any security interest
contemplated by the Collateral Documents or any other document referred to
therein; and (f) all costs, fees, expenses and other charges in respect of any
Letters of Credit paid by Investment Manager or the L/C Guarantors to the
issuing banks of such Letters of Credit. Payments under this Section 2.3 shall
be made promptly and in any case no later than ten (10) days after written
demand therefor. Any payments under this Section 2.3 which remain outstanding
more than sixty (60) after written demand therefor shall accrue interest at a
per annum rate equal to (x) the “prime rate” as set forth in the Wall Street
Journal on the date of determination, plus (y) two percent (2.00%).

          2.4 Security Interest. The Obligations of the Borrowers hereunder
shall be secured in accordance with the terms of the Collateral Documents.

          2.5 Prepayment. The Borrowers may prepay, prior to the occurrence of
any Drawing, any Obligations outstanding under this Agreement and terminate this
Agreement after (i) three (3) Business Days notice, (ii) payment of the Success
Fee set forth in Section 2.2(b), (iii) payment of all amounts owed pursuant to
Section 2.3, and (iv) pledging cash to the L/C Guarantors on terms reasonably
acceptable to the L/C Guarantors in an amount equal to the aggregate face amount
of any outstanding Letters of Credit; provided that the Borrowers shall also be
required to obtain prior written consent from the Senior Lender, if the Senior
Indebtedness is outstanding at the time of such prepayment.

          2.6 Term. Following a prepayment pursuant to Section 2.5, this
Agreement may be terminated by either party after the Closing Date; provided
that the Borrowers shall also be required to obtain prior written consent from
the Senior Lender, if the Senior Indebtedness is outstanding at the time of such
termination. The Borrowers’ obligation to pay the fees specified in Section
2.2(c) for each Drawing and any interest accrued under Section 2.3 shall survive
the Termination Date.

3. CONDITIONS TO CLOSING

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          The obligations of Investment Manager and the L/C Guarantors
hereunder, shall be subject to the performance by the Borrowers of their
agreements to be performed hereunder and to the satisfaction, prior thereto or
concurrently therewith, of the following further conditions:

          3.1 Closing.

               (a) Representations and Warranties. The representations and
warranties of the Borrowers contained in Section 4 hereof shall be true and
correct in all material respects as of the Closing Date (as modified by the
Disclosure Schedules delivered as of the Closing Date) as though such warranties
and representations were made at and as of such date, except as otherwise
affected by the transactions contemplated hereby.

               (b) Compliance with Loan Documents, No Default or Event of
Default. The Borrowers shall have performed and complied with all agreements,
covenants and conditions contained in the Loan Documents which are required to
be performed or complied with by it prior to or on the Closing Date. No Default
or Event of Default shall exist prior to or after giving effect to the
transactions contemplated on the Closing Date.

               (c) Injunction. There shall be no effective injunction, writ,
preliminary restraining order or any order of any nature issued by a court of
competent jurisdiction directing that the transactions provided for herein or
any of them not be consummated as herein provided.

               (d) Counsel’s Opinion. Investment Manager shall have received
from the Borrowers’ counsel, an opinion, dated the Closing Date, substantially
in the form of Exhibit 3.1(d) hereto.

               (e) Approval of Proceedings. All proceedings to be taken in
connection with the transactions contemplated by this Agreement, and all
documents incident thereto, shall be satisfactory in form and substance to
Investment Manager or the L/C Guarantors and their counsels; and Investment
Manager shall have received copies of all documents or other evidence which they
and their counsel may request in connection with such transactions and of all
records of corporate proceedings in connection therewith in form and substance
satisfactory to Investment Manager or the L/C Guarantors and their counsels.

               (f) Other Fees and Expenses. The Borrowers shall have paid to
Investment Manager all other amounts payable hereunder, including the payment of
the fees and expenses of Cooley Godward Kronish LLP, counsel to Investment
Manager, invoiced prior to the Closing Date.

               (g) Secretary’s Certificate. Investment Manager shall have
received a certificate, dated the Closing Date, signed by the Secretary or
Assistant Secretary, as the case may be, of each Borrower certifying that (i)
its articles or certificate of incorporation, certificate of formation or
certificate of organization annexed thereto are in full force and effect without
any amendment, (ii) the by-laws or operating agreement annexed thereto are
correct and complete as in effect on the date thereof; and (iii) the resolutions
annexed thereto approving the transactions contemplated herein have been duly
approved by the Board of Directors and/or Managers of such Borrower and remain
in full force and effect.

               (h) Security Interests. All action necessary or determined by
Investment Manager to be desirable to create and perfect the security interests
purported to be created by the Collateral

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Documents shall have been taken or completed, including the execution and
delivery of the Collateral Documents and the filing of the Uniform Commercial
Code financing statements.

               (i) Insurance. Investment Manager shall have received evidence
that the insurance required to be maintained under this Agreement and the
Collateral Documents is in full force and effect and that Investment Manager or
the L/C Guarantors have been named as loss payee or additional insured, as
appropriate, under the applicable insurance policies.

               (j) Accounts Aging Report. The Borrowers shall have delivered to
Investment Manager, a report listing all accounts receivable (aged by invoice
date) and all accounts payable (aged by invoice date) for all accounts
outstanding for more than 90 days from its invoice date, or the most recent
comparable report delivered by the Borrowers to the Senior Lender.

               (k) Other Documents. The Borrowers shall have executed and
delivered to Investment Manager and the L/C Guarantors, the Loan Documents.

4. REPRESENTATIONS AND WARRANTIES

          To induce Investment Manager and the L/C Guarantors to enter into the
Loan Documents, the Borrowers, jointly and severally, represent and warrant to
Investment Manager and the L/C Guarantors that the following statements are
true, correct and complete as of the Closing Date. Such representations and
warranties are subject to the qualifications and exceptions set forth in the
Disclosure Schedules delivered to Investment Manager and the L/C Guarantors in
connection herewith. References to the knowledge or awareness of the Borrowers
are deemed to include the actual knowledge of any officer or director of any
Borrower or any of their respective Subsidiaries after due inquiry.

          4.1 Disclosure. No representation or warranty of any Borrower
contained in this Agreement, the Financial Statements, or any other document,
certificate or written statement furnished to Investment Manager or the L/C
Guarantors by the Borrowers or their auditors at Closing contains any untrue
statement of a material fact or omitted or omits to state a material fact
necessary in order to make the statements contained herein or therein not
misleading in light of the circumstances in which the same were made.

          4.2 No Conflict; Compliance. The consummation of the transactions
contemplated by this Agreement and the other Loan Documents does not and will
not violate or conflict with any laws, rules, regulations or orders of any
Governmental Authority or violate, conflict with, result in a breach of, or
constitute a default (with due notice or lapse of time or both) under any
Contractual Obligation or organizational documents of any Borrower or any of
their Subsidiaries except if such violations, conflicts, breaches or defaults
could not reasonably be expected to have, either individually or in the
aggregate, a Material Adverse Effect. The Borrowers (i) are in compliance and
each of their Subsidiaries is in compliance with the requirements of all
applicable laws, rules, regulations and orders of any Governmental Authority and
the obligations, conditions and covenants contained in all Contractual
Obligations other than those laws, rules, regulations, orders and provisions of
such Contractual Obligations the noncompliance with which could not be
reasonably expected to have a Material Adverse Effect, and (ii) maintains and
each of their Subsidiaries maintains all licenses, qualifications and permits
necessary for the conduct of their respective businesses as presently conducted
and expected to be conducted.

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          4.3 Organization, Powers, Capitalization and Good Standing.

               (a) Organization and Powers. Each Borrower and each of their
respective Subsidiaries is duly organized, validly existing and in good standing
under the laws of its jurisdiction of organization and qualified to do business
in all states where such qualification is required except where failure to be so
qualified could not reasonably be expected to have a Material Adverse Effect.
The jurisdiction of organization and all jurisdictions in which each Borrower is
qualified to do business are set forth on Schedule 4.3(a). Each Borrower and
each of their respective Subsidiaries has all requisite organizational power and
authority to own and operate its properties, to carry on its business as now
conducted and proposed to be conducted, to enter into each of the Loan Documents
to which it is a party and to incur the Obligations, grant liens and security
interests in the Collateral and carry out the transactions contemplated by this
Agreement and the other Loan Documents.

               (b) Capitalization. As of the Closing Date: (i) the authorized
Stock of each Borrower and each of their respective Subsidiaries is as set forth
on Schedule 4.3(b); (ii) all issued and outstanding Stock of each Borrower and
each of their respective Subsidiaries is duly authorized and validly issued,
fully paid, nonassessable, free and clear of all Liens other than those in favor
of Senior Lenders, the holders of Subordinated Debt, and Investment Manager for
the benefit of Investment Manager and the L/C Guarantors, and such Stock was
issued in compliance with all applicable state, federal and foreign laws
concerning the issuance of securities; (iii) MTM is the sole holder of the Stock
of each Borrower (other than MTM); (iv) the capitalization of MTM is as set
forth on Schedule 4.3(b); and (v) no Stock of any Borrower or any of their
respective Subsidiaries, other than those described above, are issued and
outstanding. Except as provided in Schedule 4.3(b), as of the Closing Date,
there are no preemptive or other outstanding rights, options, warrants,
conversion rights or similar agreements or understandings for the purchase or
acquisition from any Borrower or any of their respective Subsidiaries of any
Stock of any such entity.

               (c) Binding Obligation. This Agreement is, and the other Loan
Documents when executed and delivered will be, the legally valid and binding
obligations of the applicable parties thereto, each enforceable against each of
such parties, as applicable, in accordance with their respective terms except as
enforceability may be limited by applicable bankruptcy, insolvency, moratorium
and laws affecting the rights of creditors generally and by general principles
of equity whether considered at law or in equity.

          4.4 Financial Statements. The Financial Statements of MTM and its
consolidated Subsidiaries that have been filed with the Securities and Exchange
Commission, have been prepared in accordance with GAAP consistently applied
(except as disclosed therein) and present fairly in all material respects the
financial condition of MTM and its consolidated subsidiaries as at the dates
thereof and the results of their operations for the periods then ended, subject
to, in the case of unaudited financial statements, the absence of footnotes and
normal year end adjustments.

          4.5 Intellectual Property. Each Borrower and each of their respective
Subsidiaries owns, is licensed to use or otherwise has the right to use, all
Intellectual Property used in or necessary for the conduct of its business as
currently conducted and all such Intellectual Property (other than off the shelf
software) is identified on the Perfection Certificate and fully protected and/or
duly and properly registered, filed or issued in the appropriate office and
jurisdictions for such registrations, filings or issuances. Except as disclosed
in the Perfection Certificate, the use of such Intellectual Property by the
Borrowers and their Subsidiaries and the conduct of their businesses do not,
and, to the knowledge of

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the Borrowers, have not been alleged in writing by any Person to infringe on the
rights of any Person.

          4.6 Investigations, Audits, Etc. As of the Closing Date, except as set
forth on Schedule 4.6, no Borrower nor any Subsidiary of any Borrower is the
subject of any review or audit by the IRS or any governmental investigation
concerning the violation or possible violation of any law.

          4.7 Litigation; Adverse Facts. Except as set forth on Schedule 4.7,
there are no judgments outstanding against any Borrower or any Subsidiary of any
Borrower or affecting any property of any Borrower or any Subsidiary of any
Borrower, nor is there any Litigation pending, or to the best knowledge of the
Borrowers threatened, against any Borrower or any Subsidiary of any Borrower
which could reasonably be expected to result in any Material Adverse Effect.

          4.8 Use of Proceeds; Margin Regulations.

               (a) No part of the proceeds of the loans secured by the Letters
of Credit will be used for “buying” or “carrying” “margin stock” within the
respective meanings of such terms under Regulation U of the Board of Governors
of the Federal Reserve System as now and from time to time hereafter in effect
or for any other purpose that violates the provisions of the regulations of the
Board of Governors of the Federal Reserve System. If requested by Investment
Manager, the Borrowers will furnish to Investment Manager and the L/C Guarantors
a statement to the foregoing effect in conformity with the requirements of FR
Form G 3 or FR Form 0 1, as applicable, referred to in Regulation U.

               (b) The Borrowers shall utilize the proceeds of the loans secured
by the Letters of Credit solely for the financing of the Borrowers’ general
corporate needs.

          4.9 Ownership of Property; Liens. Each Borrower and each Subsidiary of
the Borrowers owns good and marketable fee simple title to all of its owned real
estate (“Real Estate”), and valid and marketable leasehold interests in all of
its leased Real Estate, and copies of all such leases have been delivered to
Investment Manager. Each Borrower and each Subsidiary of the Borrowers also has
good and marketable title to, or valid leasehold interests in or licenses of,
all of its personal property and assets. As of the Closing Date, none of the
properties and assets of any Borrower or any Subsidiary of any Borrower are
subject to any Liens other than Permitted Encumbrances, and there are no facts,
circumstances or conditions known to the Borrowers that may result in any Liens
(including Liens arising under Environmental Laws) other than Permitted
Encumbrances against the properties or assets of any Borrower or any of their
Subsidiaries. As of the Closing Date, no portion of any Borrower’s or any
Subsidiary of any Borrower’s Real Estate has suffered any material damage by
fire or other casualty loss that has not heretofore been repaired and restored
in all material respects to its original condition or otherwise remedied. As of
the Closing Date, all permits required to have been issued to enable the Real
Estate to be lawfully occupied and used for all of the purposes for which it is
currently occupied and used have been lawfully issued and are in full force and
effect.

          4.10 Environmental Matters.

                 (a) None of the operations of any Borrower is the subject of
any federal, state or local investigation to determine whether any remedial
action is needed to address the presence or disposal of any environmental
pollution, hazardous material or environmental clean-up of the Real Estate or
any of such Borrower’s leased Real Estate. No enforcement proceeding, complaint,
summons, citation, notice, order, claim, litigation, investigation, letter or
other communication from a

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federal, state or local authority has been filed against or delivered to any
Borrower, regarding or involving any release of any environmental pollution or
hazardous material on any real property now or previously owned or operated by
any Borrower.

                  (b) No Borrower has any known contingent liability with
respect to any release of any environmental pollution or hazardous material on
any real property now or previously owned or operated by any Borrower.

                  (c) Each Borrower is in compliance with all environmental
statutes, acts, rules, regulations and orders applicable to the operation of
such Borrower’s business, except to the extent that the failure to so comply
would not be reasonably likely to have a Material Adverse Effect.

                  (d) The Borrowers hereby acknowledge and agree that neither
Investment Manager nor any L/C Guarantor (i) is now, or has ever been, in
control of any of the Real Estate or affairs of any Borrower or Subsidiary of
any Borrower, and (ii) has the capacity through the provisions of the Loan
Documents or otherwise to influence the Borrowers’ or their Subsidiaries’
conduct with respect to the ownership, operation or management of any of their
Real Estate or compliance with Environmental Laws or Environmental Permits.

          4.11 Brokers. No broker or finder acting on behalf of any Borrower or
Affiliate of any Borrower brought about the obtaining, making or closing of this
Agreement, and Borrower or Affiliate of any Borrower has any obligation to any
Person in respect of any finder’s or brokerage fees in connection therewith.

          4.12 Deposit and Disbursement Accounts. The Perfection Certificate
lists all banks and other financial institutions at which any Borrower maintains
deposit or other accounts as of the Closing Date, and such Perfection
Certificate correctly identifies the name, address and telephone number of each
depository, the name in which the account is held, a description of the purpose
of the account, and the complete account number therefor.

          4.13 Material Agreements; Customers and Suppliers.

                 (a) Each Material Agreement is valid and binding on the
Borrowers that are parties thereto, is in full force and effect and is
enforceable against the applicable Borrower and, to the Borrowers’ knowledge,
the other parties thereto, in accordance with its terms, except as limited by
(i) applicable bankruptcy, insolvency, reorganization, moratorium, and other
laws of general application affecting enforcement of creditors’ rights
generally, (ii) laws relating to the availability of specific performance,
injunctive relief or other equitable remedies and (iii) state and federal
securities laws with respect to rights to indemnification or contribution.
Except as set forth on Schedule 4.13, no Borrower is in default or breach under
any of the Material Agreements, nor, to the knowledge of the Borrowers, is any
other party thereto in default or breach thereunder, nor are there facts or
circumstances which have occurred which, with or without the giving of notice or
the passage of time or both, would constitute a material default or breach under
any of the Material Agreements.

                 (b) To the Borrowers’ knowledge, no material customer or
material supplier intends to cancel or materially curtail its relationship with
any Borrower in a way that could reasonably be expected to have a Material
Adverse Effect.

          4.14 Insurance. The Borrowers have general commercial, product
liability, fire and casualty

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insurance policies with coverage customary for companies similarly situated to
the Borrowers.

5. AFFIRMATIVE COVENANTS

          The Borrowers hereby, jointly and severally, agree that from and after
the date hereof and until the Termination Date:

          5.1 Maintenance of Financial Records; Inspections. The Borrowers agree
to maintain books and records pertaining to their financial matters in such
detail, form and scope, as Investment Manager reasonably may require. Each
Borrower agrees that Investment Manager, accompanied by any of the L/C
Guarantors, and/or any agent designated by Investment Manager, upon notice to
the Borrowers (provided that such notice shall not be required after any Default
or Event of Default shall have occurred), may enter upon such Borrower’s
premises at any time during normal business hours, and from time to time, in
order to (i) examine and inspect the books and records of such Borrower, and
make copies thereof and take extracts therefrom, and (ii) verify, inspect and
perform physical counts and other valuations of the Collateral and any and all
records pertaining thereto. Each Borrower irrevocably authorizes all accountants
and third parties to disclose and deliver directly to Investment Manager and the
L/C Guarantor, at such Borrower’s expense, all financial statements and
information, books, records, work papers and management reports generated by
them or in their possession regarding such Borrower or the Collateral. All
costs, fees and expenses incurred by Investment Manager in connection with such
examinations, inspections, physical counts and other valuations shall constitute
Fees reimbursable by the Borrowers pursuant to Section 2.3 for purposes of this
Agreement.

          5.2 Further Assurances. Each Borrower agrees to comply with the
requirements of all state and federal laws in order to grant to Investment
Manager, for the benefit of Investment Manager and the L/C Guarantors, valid and
perfected first priority security interests in the Collateral pursuant to the
Collateral Documents, subject only to the Permitted Encumbrances. Investment
Manager is hereby authorized by each Borrower to file any financing statements,
continuations and amendments covering the Collateral without such Borrower’s
signature in accordance with the provisions of the Code. Each Borrower hereby
consents to and ratifies the filing of any financing statements covering the
Collateral by Investment Manager on or prior to the Closing Date. Each Borrower
agrees to do whatever Investment Manager reasonably may request from time to
time, by way of (i) filing notices of liens, financing statements, amendments,
renewals and continuations thereof, (ii) cooperating with agents and employees
of Investment Manager, (iii) keeping Collateral records, (iv) transferring
proceeds of Collateral to Investment Manager’s possession in accordance with the
terms of this Agreement and the Collateral Documents and (v) performing such
further acts as Investment Manager reasonably may require in order to effect the
purposes of this Agreement and the Collateral Documents, including the execution
of control agreements with respect to deposit accounts and investment property.

          5.3 Insurance and Condemnation.

                (a) Required Insurance. Each Borrower agrees to maintain
insurance on the Real Estate, Equipment and Inventory under such policies of
insurance, with such insurance companies, in such reasonable amounts and
covering such insurable risks, as are at all times reasonably satisfactory to
Investment Manager (the “Required Insurance”). All policies covering the Real
Estate, Equipment and Inventory are, subject to the rights of any holder of a
Permitted Encumbrance having priority over the security interests of Investment
Manager, to be made payable solely to Investment Manager, for the benefit of
Investment Manager and the L/C Guarantors, in case of loss, under a standard non
contributory “mortgagee”, “secured party” or “lender’s loss payable” clause or
endorsement, and are to

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contain such other provisions as Investment Manager reasonably may require to
fully protect Investment Manager’s interest in the Real Estate, Inventory and
Equipment and to any payments to be made under such policies. Each loss payable
endorsement in favor of Investment Manager shall provide (x) for not less than
thirty (30) days prior written notice to Investment Manager of the exercise of
any right of cancellation and (y) that Investment Manager’s right to payment
under any property insurance policy will not be invalidated by any act or
neglect of, or any breach of warranty or condition by, any Borrower or any other
party. If an Event of Default shall have occurred and remain outstanding,
Investment Manager, subject to the rights of any holder of a Permitted
Encumbrance having priority over the security interests of Investment Manager,
shall have the sole right, in the name of Investment Manager or any Borrower, to
file claims under any insurance policies, 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.

                (b) Investment Manager’s Purchase of Insurance. Unless the
Borrowers provide Investment Manager with evidence of the Required Insurance in
the manner set forth in Section 5.3(a) above, Investment Manager may purchase
insurance at the Borrowers’ expense to protect Investment Manager’s interests in
the Collateral. The insurance purchased by Investment Manager may, but need not,
protect the Borrowers’ interests in the Collateral, and therefore such insurance
may not pay any claim which any Borrower makes or any claim which is made
against any Borrower in connection with the Collateral. The Borrowers may later
request that Investment Manager cancel any insurance purchased by Investment
Manager, but only after providing Investment Manager with satisfactory evidence
that the Borrowers have the Required Insurance. If Investment Manager purchases
insurance covering all or any portion of the Collateral, the Borrowers shall be
responsible for the costs of such insurance, including interest (at the
applicable rate set forth hereunder) and other charges accruing on the purchase
price therefor, until the effective date of the cancellation or the expiration
of the insurance. The costs of the premiums of any insurance purchased by
Investment Manager may exceed the costs of insurance which the Borrowers may be
able to purchase on their own. In the event that Investment Manager purchases
insurance, Investment Manager will notify the Borrowers of such purchase within
thirty (30) days after the date of such purchase. If, within thirty (30) days
after the date of receipt of such notice, the Borrowers provide Investment
Manager with proof that the Borrowers had the Required Insurance as of the date
on which Investment Manager purchased insurance and the Borrowers have continued
at all times thereafter to have the Required Insurance, then Investment Manager
agrees to cancel the insurance purchased by Investment Manager.

                 (c) Application of Insurance and Condemnation Proceeds. So long
as no Default or Event of Default shall have occurred and remain outstanding as
of the date of Investment Manager’s receipt of any Casualty Proceeds:

          (i) Except as may otherwise be provided in any intercreditor or
subordination agreement between Investment Manager and another creditor of the
Borrowers, in the event of any loss or damage to any item of Equipment by
condemnation, fire or other casualty, if the Casualty Proceeds relating to such
condemnation, fire or other casualty exceed $100,000, the applicable Borrower
may elect (by delivering written notice to Investment Manager within ten (10)
Business Days following Investment Manager’s receipt of such Casualty Proceeds)
to replace or repair such item of Equipment.

          (ii) In the event of any loss or damage to any Real Estate leased by a
Borrower by condemnation, fire or other casualty, such Borrower may use the
Casualty Proceeds in the manner

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required or permitted by the lease agreement relating thereto. In the event of
any loss or damage to any Real Estate owned by a Borrower by condemnation, fire
or other casualty, if the Casualty Proceeds relating to such condemnation, fire
or other casualty exceed $100,000, and so long as such Borrower has sufficient
business interruption insurance to replace the lost profits of the facilities
affected by the condemnation, fire or other casualty, such Borrower may elect to
repair or replace such Real Estate, subject to the following terms:

          (1) If such Borrower reasonably determines that the Real Estate may be
repaired to substantially the same condition of the Real Estate prior to the
condemnation, fire or other casualty, such Borrower may elect to repair the Real
Estate by delivering written notice to Investment Manager within thirty (30)
days following Investment Manager’s receipt of such Casualty Proceeds.

          (2) Such Borrower may elect to replace the Real Estate owned by such
Borrower only on terms and conditions satisfactory to Investment Manager in its
sole discretion.

          If a Default or an Event of Default shall have occurred and remain
outstanding as of the date of Investment Manager’s receipt of any Casualty
Proceeds, or if a Borrower does not or cannot elect to use the Casualty Proceeds
in the manner set forth in paragraphs (i) or (ii) above, Investment Manager may,
subject to the terms of any intercreditor or subordination agreement between
Investment Manager and another creditor of the Borrowers, and subject to the
rights of any holder of a Permitted Encumbrance having priority over the
security interests of Investment Manager, apply the Casualty Proceeds to the
payment of the Obligations in such manner and in such order as Investment
Manager may elect in its sole discretion.

          5.4 Payment of Taxes. Each Borrower agrees to pay when due all Taxes
lawfully levied, assessed or imposed upon such Borrower or the Collateral
(including all sales taxes collected by a Borrower on behalf of such Borrower’s
customers in connection with sales of Inventory and all payroll taxes collected
by such Borrower on behalf of such Borrower’s employees), unless such Borrower
is contesting such Taxes in good faith, by appropriate proceedings, and is
maintaining adequate reserves for such Taxes in accordance with GAAP.
Notwithstanding the foregoing, if a lien securing any Taxes is not a Permitted
Tax Lien, then the applicable Borrower shall pay all taxes secured by such lien
immediately and remove such lien of record promptly. Pending the payment of such
taxes and removal of such lien, Investment Manager may, at its election and
without curing or waiving any Event of Default which may have occurred as a
result thereof, pay such taxes on behalf of such Borrower, and the amount paid
by Investment Manager shall become an Obligation which is due and payable by
Borrower upon demand by Investment Manager.

          5.5 Compliance With Laws.

                (a) Each Borrower agrees to comply with all federal, state and
local acts, rules and regulations, and all orders of any federal, state or local
legislative, administrative or judicial body or official, if the failure to so
comply would be reasonably likely to have a Material Adverse Effect, provided
that such Borrower may contest any acts, rules, regulations, orders and
directions of such bodies or officials in any reasonable manner which Investment
Manager determines, in the exercise of its reasonable business judgment, will
not materially and adversely effect Investment Manager’s or the L/C Guarantors’
rights or priorities in the Collateral.

                (b) Without limiting the generality of the foregoing, each
Borrower agrees to comply with all environmental statutes, acts, rules,
regulations or orders, as presently existing or as adopted or amended in the
future, applicable to the ownership and/or use of its real property and

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operation of its business, if the failure to so comply would be reasonably
likely to have a Material Adverse Effect. No Borrower shall be deemed to have
breached any provision of this Section 5.5(b) if (x) the failure to comply with
the requirements of this Section 5.5 resulted from good faith error or innocent
omission, (y) such Borrower promptly commences and diligently pursues a cure of
such breach and (z) such failure is cured within thirty (30) days following such
Borrower’s receipt of notice from Investment Manager of such failure, or if such
breach cannot in good faith be cured within thirty (30) days following such
Borrower’s receipt of such notice, then such breach is cured within a reasonable
time frame based on the extent and nature of the breach and the necessary
remediation, and in conformity with any applicable consent order, consensual
agreement and applicable law.

          5.6 Notices Concerning Environmental, Employee Benefit and Pension
Matters. The Borrowers agree to notify Investment Manager in writing of:

                (a) any expenditure (actual or anticipated) by any Borrower in
excess of $100,000 for environmental clean up, environmental compliance or
environmental testing and the impact of said expenses on such Borrower’s working
capital;

                (b) any Borrower’s receipt of notice from any local, state or
federal authority advising such Borrower of any environmental liability (real or
potential) arising from such Borrower’s operations, its premises, its waste
disposal practices, or waste disposal sites used by such Borrower; and

                (c) any Borrower’s receipt of notice from any governmental
agency or any sponsor of any “multiemployer plan” (as that term is defined in
ERISA) to which such Borrower has contributed, relating to any ERISA Event.

          Each Borrower agrees to provide Investment Manager promptly with
copies of all such notices and other information pertaining to any matter set
forth above if Investment Manager so requests.

          5.7 Business Qualification. Each Borrower agrees to qualify to do
business, and to remain qualified to do business and in good standing, in each
jurisdiction where the failure to so qualify, or to remain qualified or in good
standing, would have, or would be reasonably likely to have, a Material Adverse
Effect.

          5.8 Anti-Money Laundering and Terrorism Regulations. Each Borrower
agrees to comply with all applicable anti-money laundering and terrorism laws,
regulations and executive orders in effect from time to time (including, without
limitation, the USA Patriot Act (Pub. L. No. 107-56)). Each Borrower also agrees
to ensure that no person who owns a controlling interest in or otherwise
controls such Borrower is a person designated under Section 1(b), (c) or (d) of
Executive Order No. 13224 (issued September 23, 2001) or any other similar
Executive Order. Each Borrower acknowledges that Investment Manager’s and the
L/C Guarantors’ performance hereunder is subject to compliance with all such
laws, regulations and executive orders, and in furtherance of the foregoing,
each Borrower agrees to provide to Investment Manager and the L/C Guarantors all
information about such Borrower’s ownership, officers, directors, customers and
business structure as Investment Manager and the L/C Guarantors reasonably may
require to comply with, such laws, regulations and executive orders.

         5.9 Maintenance of Properties. Each Borrower will maintain or cause to
be maintained in good repair, working order and condition all material
properties used in the business of such Borrower

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and its Subsidiaries and will make or cause to be made all appropriate repairs,
renewals and replacements thereof, ordinary wear and tear excepted.

          5.10 L/C Guarantors Meeting. The Borrowers will participate and will
cause its key management personnel and those of its Subsidiaries to participate
in a meeting with Investment Manager and the L/C Guarantors at least once during
each year, which meeting shall be held at such time and such place as may be
reasonably requested by Investment Manager.

          5.11 Organizational Existence. Except as permitted by Section 6.4,
each Borrower will and will cause its Subsidiaries to at all times preserve and
keep in full force and effect its organizational existence and all rights and
franchises the absence of which could reasonably be expected to have a Material
Adverse Effect.

          5.12 Landlords’ Agreements, Mortgagee Agreements, Bailee Letters and
Real Estate Purchases. The Borrowers shall use reasonable efforts to obtain a
landlord’s agreement, mortgagee agreement or bailee letter, as applicable, from
each lessor of leased property, mortgagee of owned property or bailee with
respect to any warehouse, processor or converter facility or other location
where Collateral is stored or located, which agreement or letter shall contain a
waiver or subordination of all Liens or claims that the landlord, mortgagee or
bailee may assert against the Collateral at that location, and shall otherwise
be reasonably satisfactory in form and substance to Investment Manager. After
the Closing Date, no real property or warehouse space shall be leased by any
Borrower or any Subsidiary of any Borrower and no Inventory shall be shipped to
a processor or converter under arrangements established after the Closing Date
without the prior written consent of Investment Manager or, unless and until a
satisfactory landlord agreement or bailee letter, as appropriate, shall first
have been obtained with respect to such location. The Borrowers shall and shall
cause each of their Subsidiaries to timely and fully pay and perform their
obligations under all leases and other agreements with respect to each leased
location or public warehouse where any Collateral is or may be located. In the
event any Borrower acquires a fee interest in real property after the Closing
Date, the Borrowers shall deliver to Investment Manager a fully executed
mortgage or deed of trust over such real property in form and substance
satisfactory to Investment Manager, together with such title insurance policies,
surveys, appraisals, evidence of insurance, legal opinions, environmental
assessments and other documents and certificates as shall be reasonably
requested by Investment Manager.

          5.13 New Subsidiaries. The Borrowers shall (a) cause each Person, upon
its becoming a Subsidiary of any Borrower (provided that this shall not be
construed to constitute consent by the L/C Guarantors to any transaction not
expressly permitted by the terms of this Agreement), promptly to guaranty the
Obligations and to grant to Investment Manager, for the benefit of Investment
Manager and the L/C Guarantors, a security interest in the real, personal and
mixed property of such Person to secure the Obligations and (b) pledge, or cause
to be pledged, to Investment Manager, for the benefit of Investment Manager and
the L/C Guarantors, all of the Stock of such Subsidiary owned by any Borrower to
secure the Obligations. The documentation for such guaranty, security and pledge
shall be substantially similar to the Loan Documents executed concurrently
herewith with such modifications as are reasonably requested by Investment
Manager.

6. NEGATIVE COVENANTS

          The Borrowers hereby, jointly and severally, agree that from and after
the date hereof until the Termination Date that no Borrower shall, nor shall it
permit any Subsidiary to:

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          6.1 Liens and Encumbrances; No Negative Pledges. Mortgage, assign,
pledge, transfer or otherwise permit any lien, charge, security interest,
encumbrance or judgment (whether as a result of a purchase money or title
retention transaction, or other security interest, or otherwise) to exist on any
of the Collateral or its other assets, whether now owned or hereafter acquired,
except for the Permitted Encumbrances. No Borrower shall, or cause or permit its
Subsidiaries to, directly or indirectly, enter into or assume any agreement
(other than the Loan Documents, the Subordinated Debt and the Senior
Indebtedness) prohibiting the creation or assumption of any Lien upon its
properties or assets, whether now owned or hereafter acquired

          6.2 Indebtedness. Incur or create any Indebtedness other than the
Permitted Indebtedness.

          6.3 Sale of Assets. Sell, lease, assign, transfer or otherwise dispose
of (i) Collateral, except for the disposition of Inventory and Equipment in the
ordinary course of business or as otherwise specifically permitted by this
Agreement or the terms of any Senior Indebtedness, or (ii) all or any
substantial part of its assets, if any, which do not constitute Collateral. Each
Borrower may sell obsolete Equipment or surplus Equipment from time to time,
provided that in each such instance: (i) no Event of Default shall have occurred
and remain outstanding at the time of such sale; (ii) the aggregate book value
of all Equipment owned by all of the Borrowers subject to sale does not exceed
$100,000 in any fiscal year of MTM, and (iii) all net proceeds of such sales are
either (x) promptly used by such selling Borrower to repay Senior Indebtedness,
or (y) within 90 days of such sale, used to purchase replacement Equipment that
such selling Borrower determines in its reasonable business judgment to have a
value at least equal to the Equipment sold. Upon the sale, transfer, lease or
other disposition of Equipment, the security interest of Investment Manager and
the L/C Guarantors in the Equipment shall, without break in continuity and
without further formality or act, continue in, and attach to, all proceeds
thereof. As to any such sale, transfer, lease or other disposition, Investment
Manager shall have all of the rights of an unpaid seller, including stoppage in
transit, replevin, rescission and reclamation.

          6.4 Corporate Change. (i) Merge or consolidate with any other entity
except in connection with a Change of Control, (ii) change its name or principal
place of business, (iii) change its structure or organizational form, or
reincorporate or reorganize in a new jurisdiction, (iv) enter into or engage in
any operation or activity materially different from that presently being
conducted by such Borrower provided that such Borrower may (x) change its name
or its principal place of business or (y) change its structure or organizational
form, or reincorporate or reorganize in a new jurisdiction, so long as such
Borrower provides Investment Manager with thirty (30) days prior written notice
thereof and such Borrower executes and delivers to Investment Manager, prior to
making such change, all documents and agreements required by Investment Manager
in order to ensure that the liens and security interests granted to Investment
Manager, for the benefit of Investment Manager and the L/C Guarantors, hereunder
continue in effect without any break or lapse in perfection. For the purposes of
this Section, any operation or activity by a Borrower that materially involves
producing, manufacturing, designing, reselling, marketing, licensing or
providing products (including intellectual property and software) or services
relating to information technology shall be deemed not to be an operation or
activity materially different from that presently conducted by such Borrower.

          6.5 Guaranty Obligations. Assume, guarantee, endorse, or otherwise
become liable upon the obligations of any person, firm, entity or corporation,
except by the endorsement of negotiable instruments for deposit or collection or
similar transactions in the ordinary course of business and other than
guarantees permitted under the definition of Permitted Indebtedness herein.

          6.6 Dividends and Distributions. Declare or pay any dividend or
distribution of any kind

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on, or purchase, acquire, redeem or retire, any of its equity interests (of any
class or type whatsoever), whether now or hereafter issued and outstanding,
other than Permitted Distributions.

          6.7 Investments. (i) Create any new subsidiary, or (ii) make any
advance or loan to, or any investment in, any firm, entity, person or
corporation, or (iii) acquire all or substantially all of the assets of, or any
capital stock or any equity interests in, any firm, entity or corporation, other
than current investments of such Borrower in its existing subsidiaries,
provided, however that such Borrower may make loans and advances on an unsecured
basis, in the ordinary course of its business and on fair and reasonable terms,
to any other Borrower.

          6.8 Related Party Transactions. Enter into any transaction, including,
without limitation, any purchase, sale, lease, loan or exchange of property,
with any shareholder, officer, director, parent (direct or indirect), subsidiary
(direct or indirect) or other person or entity otherwise affiliated with such
Borrower unless (i) such transaction otherwise complies with the provisions of
this Agreement, (ii) such transaction is for the sale of goods or services
rendered in the ordinary course of business and pursuant to the reasonable
requirements of the Borrower or for the sale of Subordinated Debt or equity
interests of the Borrower and, in each case, and upon standard terms and
conditions and fair and reasonable terms, no less favorable to such entity than
such entity could obtain in a comparable arms length transaction with an
unrelated third party, and (iii) no Event of Default shall have occurred and
remain outstanding at the time such transaction occurs, or would occur after
giving effect to such transaction. For the avoidance of doubt, the parties
acknowledge and agree that any Borrower may, after the date hereof, enter into
one or more transactions with a portfolio company of any shareholder of MTM,
provided that each such transaction complies with this Section 6.8.

          6.9 Restricted Payments. (i) Make any payment of the principal of, or
interest on, any Subordinated Debt, or purchase, acquire or redeem any of the
Subordinated Debt, unless (x) such payment, purchase, acquisition or redemption
is expressly permitted by the terms of the applicable intercreditor or
subordination agreement and (y) no Default or Event of Default shall have
occurred and remain outstanding on the date on which such payment or transaction
occurs, or would occur as a result thereof; provided, that so long as such
payment, purchase, acquisition or redemption does not cause a Default or Event
of Default to occur, it may be paid in stock or other equity interests of any
Borrower or from the proceeds of Subordinated Debt; and (ii) pay any management,
consulting or other similar fees to any shareholder, director, parent (direct or
indirect), subsidiary (direct or indirect) or other person or entity otherwise
affiliated with such Borrower or any subsidiary of the Borrower, (other than the
current, customary or prevailing fees and expenses to members of such Borrower’s
Board of Directors, and fees and salaries of any shareholder or other person
paid to such person in their capacity as officer or employee of such Borrower,
including, without limitation, fees, salaries, bonuses and other forms of
compensation pursuant to employment or other agreements.

          6.10 Use of Proceeds. Use the proceeds of any loan secured by the
Letters of Credit, directly or indirectly, (i) in violation of any applicable
law or regulation, including without limitation Regulations T, U or X of the
Board of Governors of the Federal Reserve System as from time to time in effect
(and any successor regulation or official interpretation of such Board), (ii) to
purchase or carry any “margin stock”, as defined in Regulations U and X, or any
“margin security”, “marginable OTC stock” or “foreign margin stock” within the
meaning of Regulation T, U or X, (iii) for any purpose other than to fund the
working capital needs of the Borrowers.

          6.11 No Restrictions on Subsidiary Distributions to the Borrowers.
Except as provided herein, no Borrower shall, or cause or permit its
Subsidiaries to, directly or indirectly, create or

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otherwise cause or suffer to exist or become effective any consensual
encumbrance or restriction of any kind on the ability of any such Subsidiary to:
(1) pay dividends or make any other distribution on any of such Subsidiary’s
Stock owned by any Borrower or any other Subsidiary; (2) pay any Indebtedness
owed to any Borrower or any other Subsidiary; (3) make loans or advances to any
Borrower or any other Subsidiary; or (4) transfer any of its property or assets
to any Borrower or any other Subsidiary.

          6.12 Conduct of Business. No Borrower shall, or cause or permit its
Subsidiaries to, directly or indirectly, engage in any business other than
businesses of the type described on Schedule 6.12.

          6.13 Changes Relating to Subordinated Debt. No Borrower shall, or
cause or permit its Subsidiaries to, directly or indirectly, change or amend the
terms of any of its Subordinated Debt if the effect of such amendment is to: (a)
increase the interest rate on such Indebtedness; (b) accelerate the dates upon
which payments of principal or interest are due on such Indebtedness; (c) add or
make more likely any event of default or add or make more restrictive any
covenant with respect to such Indebtedness; (d) add or make more onerous on any
Borrower the redemption or prepayment provisions of such Indebtedness; (e)
change the subordination provisions thereof (or the subordination terms of any
guaranty thereof) in a manner adverse to any Borrower, Investment Manager or any
L/C Guarantor; (f) change or amend any other term if such change or amendment
would materially increase the obligations of the obligor or confer additional
material rights on the holder of such Indebtedness in a manner adverse to any
Borrower or any L/C Guarantor; or (g) increase the portion of interest payable
in cash with respect to any Indebtedness for which interest is payable by the
issuance of payment-in-kind notes or is permitted to accrue.

          6.14 Press Release; Public Offering Materials. Each Borrower agrees
that neither it nor its Affiliates will in the future issue any press releases,
using the name of Investment Manager or the L/C Guarantors or their respective
Affiliates or referring to this Agreement or the other Loan Documents without at
least two (2) Business Days’ prior notice to Investment Manager or the L/C
Guarantors unless (and only to the extent that) such Borrower or such Affiliate
is required to do so under law and then, in any event, the Borrowers or such
Affiliate will consult with Investment Manager before issuing such press
release. The Borrowers consent to the publication by Investment Manager or the
L/C Guarantors of a tombstone or similar advertising material relating to the
financing transactions contemplated by this Agreement; provided that such
tombstone or material complies with applicable law. Investment Manager or the
L/C Guarantors shall provide a draft of any such tombstone or similar
advertising material to the Borrowers for review and comment prior to the
publication thereof. Investment Manager and the L/C Guarantors reserve the right
to provide to industry trade organizations information necessary and customary
for inclusion in league table measurements.

          6.15 Bank Accounts. No Borrower shall, or cause or permit its
Subsidiaries to, establish any new bank accounts without prior written notice to
Investment Manager and unless Investment Manager and the bank at which the
account is to be opened enter into a tri-party agreement regarding such bank
account pursuant to which such bank (i) acknowledges the security interest of
Investment Manager in such bank account, (ii) subject to the terms of the
Subordination Agreement, agrees to comply with instructions originated by
Investment Manager directing disposition of the funds in the bank account
without further consent from any Borrower or Subsidiary of any Borrower
following the occurrence and during the continuance of an Event of Default, and
(iii) agrees to subordinate and limit any security interest the bank may have in
the bank account on terms satisfactory to Investment Manager.

          6.16 ERISA. No Borrower shall, or cause or permit any ERISA Affiliate
to, cause or permit to occur an ERISA Event to the extent such ERISA Event could
reasonably be expected to have a

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Material Adverse Effect.

7. REPORTING

          The Borrowers hereby, jointly and severally, covenant and agree that
from and after the date hereof until the Termination Date, the Borrowers shall
perform and comply with all covenants in this Article 7.

          7.1 Reports. The Borrowers will deliver each of the reports described
below to Investment Manager:

                    (a) Appraisals. At the Borrowers’ expense, Investment
Manager may, from time to time, obtain appraisal reports in form and substance
and from appraisers satisfactory to Investment Manager, stating the then current
market values of all or any portion of the Real Estate and personal property
owned by any Borrower.

                    (b) Senior Indebtedness Reports. Upon the request of
Investment Manager or any L/C Guarantor, the Borrowers will promptly deliver to
Investment Manager any reports or other information delivered by the Borrowers
to any Senior Lender under any of the Senior Indebtedness.

                    (c) Events of Default, Etc. Promptly upon any officer of any
Borrower obtaining knowledge of any of the following events or conditions, the
Borrowers shall deliver copies of all written notices given or received by such
Borrower or any of their Subsidiaries with respect to any such event or
condition and a certificate of such Borrower’s chief executive officer
specifying the nature and period of existence of such event or condition and
what action such Borrower or its Subsidiary has taken, is taking and proposes to
take with respect thereto: (1) any condition or event that constitutes, or which
could reasonably be expected to result in the occurrence of, an Event of Default
or; (2) any notice that any Person has given to any Borrower or any of their
Subsidiaries or any other action taken with respect to a claimed default or
event or condition of the type referred to in Section 8.1(c); (3) any event or
condition that could reasonably be expected to result in any Material Adverse
Effect; or (4) any default or event of default with respect to any Indebtedness
of any Borrower or any of their Subsidiaries.

                     (d) Litigation. Promptly upon any officer of any Borrower
obtaining knowledge of (1) the institution of any action, charge, claim, demand,
suit, proceeding, petition, governmental investigation, tax audit or arbitration
now pending or, to the best knowledge of the Borrowers after due inquiry,
threatened in writing against any Borrower or any of their Subsidiaries or
affecting any property of Borrower or any of their Subsidiaries (“Litigation”)
not previously disclosed by the Borrowers to Investment Manager or (2) any
material development in any action, suit, proceeding, governmental investigation
or arbitration at any time pending against any Borrower or affecting any
property of any Borrower which, in each case, could reasonably be expected to
have a Material Adverse Effect, the Borrowers will promptly give notice thereof
to Investment Manager and provide such other information as may be reasonably
available to them to enable Investment Manager and its counsel to evaluate such
matter.

                    (e) Notice of Corporate and other Changes. The Borrowers
shall provide prompt written notice of (1) all jurisdictions in which any
Borrower becomes qualified after the Closing Date to transact business, (2) any
change after the Closing Date in the authorized and issued Stock of any Borrower
or any Subsidiary of any Borrower or any amendment to their articles or
certificate of

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incorporation, by-laws, partnership agreement or other organizational documents,
(3) any Subsidiary created or acquired by any Borrower or any of their
Subsidiaries after the Closing Date, such notice, in each case, to identify the
applicable jurisdictions, capital structures or Subsidiaries, as applicable, and
(4) any other event that occurs after the Closing Date which would cause any of
the representations and warranties in Section 4 of this Agreement or in any
other Loan Document to be untrue or misleading in any material respect. The
foregoing notice requirement shall not be construed to constitute consent by the
L/C Guarantors to any transaction referred to above which is not expressly
permitted by the terms of this Agreement.

                    (f) Other Information. With reasonable promptness, the
Borrowers will deliver such other information, reports and data with respect to
the Borrowers or any Subsidiary as from time to time may be reasonably requested
by Investment Manager.

                    (g) Taxes. The Borrowers shall provide prompt written notice
of (i) the execution or filing with the IRS or any other Governmental Authority
of any agreement or other document extending, or having the effect of extending,
the period for assessment or collection of any Charges by any Borrower or any of
their Subsidiaries and (ii) any agreement by any Borrower or any of their
Subsidiaries or request directed to any Borrower or any of their Subsidiaries to
make any adjustment under IRC Section 481(a), by reason of a change in
accounting method or otherwise, which could reasonably be expected to have a
Material Adverse Effect.

          7.2 Accounting Terms; Utilization of GAAP for Purposes of Calculations
Under Agreement. For purposes of this Agreement, all accounting terms not
otherwise defined herein shall have the meanings assigned to such terms in
conformity with GAAP. Financial Statements and other information furnished to
Investment Manager pursuant to this Agreement (unless specifically indicated
otherwise) shall be prepared in accordance with GAAP as in effect at the time of
such preparation; provided that no Accounting Change shall affect financial
covenants, standards or terms in this Agreement; provided further that the
Borrowers shall prepare footnotes to the Financial Statements required to be
delivered hereunder that show the differences between the Financial Statements
delivered (which reflect such Accounting Changes) and the basis for calculating
financial covenant compliance (without reflecting such Accounting Changes).

8. DEFAULT.

          8.1 Events of Default. The occurrence or existence of any one or more
of the following shall constitute an “Event of Default” hereunder:

                    (a) Payment. The Borrowers fails to pay when due any
Reimbursement Payment, Fees (including, without limitation, the Facility Fee,
Success Fee and Drawing Fee) or other monetary obligation provided for herein;
or

                    (b) Change of Control. The occurrence of a Change of
Control; or

                    (c) Default in Other Agreements. Any Borrower or any of
their Subsidiaries fails to pay when due or within any applicable grace period
any principal or interest on Indebtedness (other than with respect to the
Obligations hereunder) or breaches or defaults under the terms of any
Indebtedness (other than with respect to the Obligations hereunder), or any
condition or event occurs with respect to any Indebtedness (other than with
respect to the Obligations hereunder), if the effect of such failure to pay,
breach, default or occurrence is to cause the holder or holders of Indebtedness

18

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having an aggregate principal amount in excess of $250,000 to declare such
Indebtedness due and payable prior to its stated maturity; or

                    (d) Involuntary Bankruptcy; Appointment of Receiver, Etc.
(1) A court enters a decree or order for relief with respect to any Borrower in
an involuntary case under the Bankruptcy Code, which decree or order is not
stayed or other similar relief is not granted under any applicable federal or
state law; or (2) the continuance of any of the following events for sixty (60)
days unless dismissed, bonded or discharged: (a) an involuntary case is
commenced against any Borrower, under any applicable bankruptcy, insolvency or
other similar law now or hereafter in effect; or (b) a decree or order of a
court for the appointment of a receiver, liquidator, sequestrator, trustee,
custodian or other officer having similar powers over any Borrower, or over all
or a substantial part of its property, is entered; or (c) a receiver, trustee or
other custodian is appointed without the consent of any Borrower, for all or a
substantial part of the property of such Borrower; or

                    (e) Voluntary Bankruptcy; Appointment of Receiver, Etc. (1)
Any Borrower commences a voluntary case under the Bankruptcy Code, or consents
to the entry of an order for relief in an involuntary case or to the conversion
of an involuntary case to a voluntary case under any such law or consents to the
appointment of or taking possession by a receiver, trustee or other custodian
for all or a substantial part of its property; or (2) any Borrower makes any
assignment for the benefit of creditors; or (3) the Board of Directors of any
Borrower adopts any resolution or otherwise authorizes action to approve any of
the actions referred to in this Section 8.1(e); or

                    (f) Dissolution. Any Borrower files a certificate of
dissolution under applicable state law, or is liquidated or dissolved (except in
connection with the consolidation of such Borrower with another Borrower), or
any order, judgment or decree is entered against any Borrower decreeing the
dissolution or split up of such Borrower and such order remains undischarged or
unstayed for a period in excess of fifteen (15) days.

          8.2 Remedies. Upon the occurrence of any Event of Default, (i) the
outstanding Reimbursement Payment and all Fees hereunder shall become
immediately due and payable, and shall bear interest at the lesser of (a) the
interest rate applicable to such amount immediately preceding such Event of
Default, plus an additional two percent (2%) per annum, or (b) the maximum
amount permitted by law, and (ii) Investment Manager and the L/C Guarantors may
exercise any right, power or remedy permitted to it under the Uniform Commercial
Code and applicable law. Subject to the Subordination Agreement, without
limiting the generality of the foregoing, Investment Manager and the L/C
Guarantors may hold any cash, and dispose of any other property and hold the
proceeds thereof, as collateral to secure payment obligations under this
Agreement.

9. PROVISIONS RELATED TO INVESTMENT MANAGER

          9.1 Appointment. The L/C Guarantors hereby designate and appoint
Investment Manager as its agent under this Agreement and the other Loan
Documents, and the L/C Guarantors hereby irrevocably authorize Investment
Manager to execute and deliver the Collateral Documents and to take such action
or to refrain from taking such action on its behalf under the provisions of this
Agreement and the other Loan Documents and to exercise such powers as are set
forth herein or therein, together with such other powers as are reasonably
incidental thereto. Investment Manager is authorized and empowered to amend,
modify, or waive any provisions of this Agreement or the other Loan Documents on
behalf of the L/C Guarantors subject to the requirement that the L/C Guarantors’
consent be obtained in certain instances as provided in this Article 9 and
Section 10.2. The provisions of this

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Article 9 are solely for the benefit of Investment Manager and the L/C
Guarantors and no Borrower nor any other Person shall have any rights as a third
party beneficiary of any of the provisions hereof. In performing its functions
and duties under this Agreement, Investment Manager shall act solely as agent of
the L/C Guarantors and does not assume and shall not be deemed to have assumed
any obligation toward or relationship of agency or trust with or for any
Borrower. Investment Manager may perform any of its duties hereunder, or under
the Loan Documents, by or through its agents or employees.

          9.2 Reliance. Investment Manager shall be entitled to rely, and shall
be fully protected in relying, upon any written or oral notices, statements,
certificates, orders or other documents or any telephone message or other
communication (including any writing, telex, fax or telegram) believed by it in
good faith to be genuine and correct and to have been signed, sent or made by
the proper Person, and with respect to all matters pertaining to this Agreement
or any of the Loan Documents and its duties hereunder or thereunder. Investment
Manager shall be entitled to rely upon the advice of legal counsel, independent
accountants, and other experts selected by Investment Manager in its sole
discretion.

          9.3 Successor Investment Manager.

                    (a) Resignation. Investment Manager may resign from the
performance of all its agency functions and duties hereunder at any time by
giving at least thirty (30) Business Days’ prior written notice to the Borrowers
and the L/C Guarantors. Such resignation shall take effect upon the acceptance
by a successor Investment Manager of appointment pursuant to clause (b) below or
as otherwise provided in clause (b) below.

                    (b) Appointment of Successor. Upon any such notice of
resignation pursuant to clause (a) above, the L/C Guarantors shall appoint a
successor Investment Manager which, unless an Event of Default has occurred and
is continuing, shall be acceptable to the Borrowers (the Borrowers’ approval not
to be unreasonably conditioned, delayed or withheld). If a successor Investment
Manager shall not have been so appointed within the thirty (30) Business Day
period referred to in clause (a) above, the retiring Investment Manager, upon
notice to the Borrowers and the L/C Guarantors, shall then appoint a successor
Investment Manager who shall serve as Investment Manager until such time, if
any, as the L/C Guarantors appoint a successor Investment Manager as provided
above.

                    (c) Successor Investment Manager. Upon the acceptance of any
appointment as Investment Manager under the Loan Documents by a successor
Investment Manager, such successor Investment Manager shall thereupon succeed to
and become vested with all the rights, powers, privileges and duties of the
retiring Investment Manager, and the retiring Investment Manager shall be
discharged from its duties and obligations under the Loan Documents. After any
retiring Investment Manager’s resignation as Investment Manager, the provisions
of this Article 9 shall continue to inure to its benefit as to any actions taken
or omitted to be taken by it in its capacity as Investment Manager.

          9.4 Collateral Matters.

                    (a) Release of Collateral. The L/C Guarantors hereby
irrevocably authorize Investment Manager, at its option and in its discretion,
to release any Lien granted to or held by Investment Manager upon any Collateral
(x) upon payment and satisfaction of all Obligations (other than contingent
indemnification obligations to the extent no claims giving rise thereto have
been asserted) or (y) constituting property being sold or disposed of if the
Borrowers certify to Investment Manager that the sale or disposition is made in
compliance with the provisions of this Agreement (and

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Investment Manager may rely in good faith conclusively on any such certificate,
without further inquiry).

                    (b) Confirmation of Authority; Execution of Releases.
Without in any manner limiting Investment Manager’s authority to act without any
specific or further authorization or consent by the L/C Guarantors (as set forth
in Section 9.4(a)), the L/C Guarantors agree to confirm in writing, upon request
by Investment Manager or the Borrowers, the authority to release any Collateral
conferred upon Investment Manager under clauses (x) and (y) of Section 9.4(a).
Upon receipt by Investment Manager of any required confirmation from the L/C
Guarantors of their authority to release any particular item or types of
Collateral, and upon at least ten (10) Business Days’ prior written request by
the Borrowers, Investment Manager shall (and is hereby irrevocably authorized by
the L/C Guarantors to) execute such documents as may be necessary to evidence
the release of the Liens granted to Investment Manager upon such Collateral;
provided, however, that (x) Investment Manager shall not be required to execute
any such document on terms which, in Investment Manager’s opinion, would expose
Investment Manager to liability or create any obligation or entail any
consequence other than the release of such Liens without recourse or warranty,
and (y) such release shall not in any manner discharge, affect or impair the
Obligations or any Liens upon, all interests retained by the Borrowers,
including the proceeds of any sale, all of which shall continue to constitute
part of the Collateral.

                    (c) Absence of Duty. Investment Manager shall have no
obligation whatsoever to the L/C Guarantors or any other Person to assure that
the property covered by the Collateral Documents exists or is owned by any
Borrower or is cared for, protected or insured or has been encumbered or that
the Liens granted to Investment Manager have been properly or sufficiently or
lawfully created, perfected, protected or enforced or are entitled to any
particular priority, 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 Investment Manager in
this Section 9.4 or in any of the Loan Documents, it being understood and agreed
that in respect of the property covered by the Collateral Documents or any act,
omission or event related thereto, Investment Manager may act in any manner it
may deem appropriate, in its discretion, given Investment Manager’s own interest
in property covered by the Collateral Documents and that Investment Manager
shall have no duty or liability whatsoever to the L/C Guarantors, provided that
Investment Manager shall exercise the same care which it would in dealing with
loans for its own account.

          9.5 Agency for Perfection. Investment Manager and the L/C Guarantors
hereby appoint each other L/C Guarantor as agent for the purpose of perfecting
Investment Manager’s security interest in assets which, in accordance with the
Code in any applicable jurisdiction, can be perfected by possession or control.
Should an L/C Guarantor obtain possession or control of any such assets, such
L/C Guarantor shall notify Investment Manager thereof, and, promptly upon
Investment Manager’s request therefor, shall deliver such assets to Investment
Manager or in accordance with Investment Manager’s instructions or transfer
control to Investment Manager in accordance with Investment Manager’s
instructions. The L/C Guarantors agree that they will not have any right
individually to enforce or seek to enforce any Collateral Document or to realize
upon any collateral security for the Obligations unless instructed to do so by
Investment Manager in writing, it being understood and agreed that such rights
and remedies may be exercised only by Investment Manager.

          9.6 Notice of Default. Investment Manager shall not be deemed to have
knowledge or notice of the occurrence of any Default or Event of Default unless
Investment Manager shall have received written notice from the L/C Guarantors or
the Borrowers referring to this Agreement,

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describing such Default or Event of Default and stating that such notice is a
“notice of default”. Investment Manager will use reasonable efforts to notify
the L/C Guarantors of its receipt of any such notice, unless such notice is with
respect to defaults in the payment of principal, interest and Fees, in which
case Investment Manager will notify the L/C Guarantors of its receipt of such
notice. Investment Manager shall take such action with respect to such Default
or Event of Default as may be requested by the L/C Guarantors. Unless and until
Investment Manager has received any such request, Investment Manager 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 or
in the best interests of the L/C Guarantors.

          9.7 The L/C Guarantor Actions Against Collateral. With respect to any
action by Investment Manager to enforce the rights and remedies of Investment
Manager and the L/C Guarantors under this Agreement and the other Loan
Documents, the L/C Guarantors hereby consent to the jurisdiction of the court in
which such action is maintained, and agrees to deliver any requested
documentation (with respect to the Loan Documents) to Investment Manager to the
extent necessary to enforce the rights and remedies of Investment Manager for
the benefit of Investment Manager and the L/C Guarantors under the mortgages or
similar Liens or encumbrances in accordance with the provisions hereof.

          9.8 Payment; Information; Actions in Concert.

                    (a) Return of Payments.

                              (i) If Investment Manager pays an amount to any
L/C Guarantor under this Agreement in the belief or expectation that a related
payment has been or will be received by Investment Manager from any Borrower and
such related payment is not received by Investment Manager, then Investment
Manager will be entitled to recover such amount from such L/C Guarantor on
demand without setoff, counterclaim or deduction of any kind.

                               (ii) If Investment Manager determines at any time
that any amount received by Investment Manager under this Agreement must be
returned to the Borrowers or paid to any other Person pursuant to any insolvency
law or otherwise, then, notwithstanding any other term or condition of this
Agreement or any other Loan Document, Investment Manager will not be required to
distribute any portion thereof to the L/C Guarantors. In addition, the L/C
Guarantors will repay to Investment Manager on demand any portion of such amount
that Investment Manager has distributed to the L/C Guarantors, together with
interest at such rate, if any, as Investment Manager is required to pay to the
Borrowers or such other Person, without setoff, counterclaim or deduction of any
kind.

                    (b) Dissemination of Information. Investment Manager shall
use reasonable efforts to provide the L/C Guarantors with any notice of Default
or Event of Default received by Investment Manager from, or delivered by
Investment Manager to, the Borrowers, with notice of any Event of Default of
which Investment Manager has actually become aware and with notice of any action
taken by Investment Manager following any Event of Default; provided, that
Investment Manager shall not be liable to the L/C Guarantors for any failure to
do so.

          9.9 Exculpatory Provisions. Neither Investment Manager nor any of its
directors, officers, agents or employees shall be (i) liable for any action
lawfully taken or omitted to be taken by it or them under or in connection with
this Agreement (except for its, their or such Person’s own gross negligence or
willful misconduct or, in the case of Investment Manager, the breach of its
obligations expressly set

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forth in this Agreement, unless such action was taken or omitted to be taken by
Investment Manager at the direction of the L/C Guarantors), or (ii) responsible
in any manner to the L/C Guarantors for any recitals, statements,
representations or warranties made by the Borrowers contained in this Agreement
or in any certificate, report, statement or other document referred to or
provided for in, or received under or in connection with, this Agreement for the
value, validity, effectiveness, genuineness, enforceability or sufficiency of
this Agreement or any other document furnished in connection herewith, or for
any failure of Borrower to perform its obligations hereunder, or for the
satisfaction of any condition specified in Article 3. Investment Manager shall
not be under any obligation to any L/C Guarantor to ascertain or to inquire as
to the observance or performance of any of the agreements or covenants contained
in, or conditions of, this Agreement, or to inspect the properties, books or
records of the Borrowers.

10. MISCELLANEOUS.

          10.1 Indemnities. The Borrowers agree, jointly and severally, to
indemnify, pay, and hold Investment Manager, the L/C Guarantors and their
respective officers, directors, employees, agents, and attorneys (the
“Indemnitees”) harmless from and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, claims, costs and
expenses (including all reasonable fees and expenses of counsel to such
Indemnitees) of any kind or nature whatsoever that may be imposed on, incurred
by, or asserted against an Indemnitee as a result of such Indemnitee being a
party to this Agreement or the transactions consummated pursuant to this
Agreement; provided, that the Borrowers shall have no obligation to an
Indemnitee hereunder with respect to liabilities to the extent resulting from
the gross negligence or willful misconduct of that Indemnitee as determined by a
court of competent jurisdiction. If and to the extent that the foregoing
undertaking may be unenforceable for any reason, the Borrowers agree to make the
maximum contribution to the payment and satisfaction thereof which is
permissible under applicable law.

          10.2 Amendments and Waivers. Except for actions expressly permitted to
be taken by Investment Manager, no amendment, modification, termination or
waiver of any provision of this Agreement or any other Loan Document, or any
consent to any departure by any Borrower therefrom, shall in any event be
effective unless the same shall be in writing and signed by the Borrowers,
Investment Manager and the L/C Guarantors providing a majority of the principal
amount of Letters of Credit.

          10.3 Notices. Any notice or other communication required shall be in
writing addressed to the respective party as set forth below and may be
personally served, telecopied, sent by overnight courier service or U.S. mail
and shall be deemed to have been given: (a) if delivered in person, when
delivered; (b) if delivered by fax, on the date of transmission if transmitted
on a Business Day before 4:00 p.m. Eastern Time; (c) if delivered by overnight
courier, one (1) Business Day after delivery to the courier properly addressed;
or (d) if delivered by U.S. mail, four (4) Business Days after deposit with
postage prepaid and properly addressed.

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Notices shall be addressed as follows:

 

 

 

 

If to the Borrowers:

 

 

 

 

MTM Technologies, Inc.

 

 

MTM Technologies (US), Inc.

 

 

MTM Technologies (Massachusetts), LLC

 

 

Info Systems, Inc.

 

 

1200 High Ridge Road

 

 

Stamford, Connecticut 06905

 

 

ATTN: General Counsel

 

 

Fax: (281) 668-0154

 

 

 

 

With a copy to:

 

 

 

 

Ballard Spahr Andrews & Ingersoll, LLP

 

 

1225 17th Street, Suite 2300

 

 

Denver, CO 80202

 

 

ATTN: John L. Ruppert, Esq.

 

 

Fax: (303) 382-4604

 

 

 

 

If to Investment Manager:

 

 

 

 

Columbia Partners, L.L.C. Investment Management

 

 

5425 Wisconsin Avenue

 

 

Suite 700

 

 

Chevy Chase, MD 20815

 

 

ATTN: Jason Crist

 

 

Fax: (240) 482-0401

 

 

 

 

With a copy to:

 

 

 

 

 

Cooley Godward Kronish LLP

 

 

777 6th Street, N.W., Suite 1100

 

 

Washington, DC 20001

 

 

ATTN: Aaron J. Velli, Esq.

 

 

Fax: (202) 842-7899

 

 

 

The L/C Guarantors:

 

 

 

 

 

National Electrical Benefit Fund

 

 

c/o Columbia Partners, L.L.C. Investment Management

 

 

5425 Wisconsin Avenue

 

 

Suite 700

 

 

Chevy Chase, MD 20815

 

 

ATTN: Jason Crist

 

 

Fax: (240) 482-0401

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FirstMark III L.P.

 

 

FirstMark III Offshore Partners, L.P.

 

 

c/o FirstMark Capital

 

 

1221 Avenue of the Americas, 26th Floor

 

 

New York, NY 10020

 

 

ATTN: Brian Kempner, COO & General Counsel

 

 

Fax: (212) 278-0146

 

 

 

 

 

Constellation Venture Capital II, L.P.

 

 

Constellation Venture Capital Offshore II, L.P.

 

 

CVC II Partners, LLC

 

 

The BSC Employee Fund VI, L.P.

 

 

C/o Constellation Growth Capital

 

 

40 West 57th Street, 30th Floor

 

 

New York, NY 10019

 

 

ATTN: Thomas Wasserman

 

 

Phone: 212-287-6792

 

 

 

 

With a copy to:

 

 

 

 

 

Cooley Godward Kronish LLP

 

 

777 6th Street, N.W., Suite 1100

 

 

Washington, DC 20001

 

 

ATTN: Aaron J. Velli, Esq.

 

 

Fax: (202) 842-7899

 

 

 

 

 

Edwards Angell Palmer & Dodge LLP

 

 

One Financial Plaza

 

 

Providence, RI 02903

 

 

ATTN: Thomas Jefferson IV, Esq.

 

 

Fax: (888) 325-9628

          10.4 Obligations Absolute; Failure or Indulgence Not Waiver; Remedies
Cumulative. The payment and performance by the Borrowers of all of the
Obligations shall be absolute and unconditional, irrespective of any defense or
rights of set-off, recoupment or counterclaim the Borrowers might otherwise have
against Investment Manager or the L/C Guarantors, and the Borrowers shall pay
and perform all of the Obligations, free of any deductions and without
abatement, diminution, recoupment, counterclaim or set-off. Until payment in
full of all of the Obligations, (a) no Borrower shall suspend or discontinue any
payments required pursuant to this Agreement or any other Loan Document; and (b)
each Borrower shall perform and observe all of the other terms and provisions of
this Agreement or any other Loan Documents. No failure or delay on the part of
Investment Manager or the L/C Guarantors to exercise, nor any partial exercise
of, any power, right or privilege hereunder or under any other Loan Documents
shall impair such power, right, or privilege or be construed to be a waiver of
any Default or Event of Default. All rights and remedies existing hereunder or
under any other Loan Document are cumulative to and not exclusive of any rights
or remedies otherwise available.

          10.5 Marshaling; Payments Set Aside. Neither Investment Manager nor
any L/C Guarantor

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shall be under any obligation to marshal any assets in payment of any or all of
the Obligations. To the extent that any Borrower makes payment(s) or Investment
Manager enforces its Liens or Investment Manager or any L/C Guarantor exercises
its right of set-off, and such payment(s) or the proceeds of such enforcement or
set-off is subsequently invalidated, declared to be fraudulent or preferential,
set aside, or required to be repaid by anyone, then to the extent of such
recovery, the Obligations or part thereof originally intended to be satisfied,
and all Liens, rights and remedies therefor, shall be revived and continued in
full force and effect as if such payment had not been made or such enforcement
or set off had not occurred.

          10.6 Severability. The invalidity, illegality, or unenforceability in
any jurisdiction of any provision under the Loan Documents shall not affect or
impair the remaining provisions in the Loan Documents. Furthermore, in lieu of
any such provision, there shall be added automatically as part of the applicable
agreement a legal and enforceable provision as similar in terms to such
provision as may be possible.

          10.7 Headings. Section and subsection headings are included herein for
convenience of reference only and shall not constitute a part of this Agreement
for any other purposes or be given substantive effect.

          10.8 Applicable Law. THIS AGREEMENT AND EACH OF THE OTHER LOAN
DOCUMENTS WHICH DOES NOT EXPRESSLY SET FORTH APPLICABLE LAW SHALL BE GOVERNED BY
AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE
STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES.

          10.9 Successors and Assigns. This Agreement and the other Loan
Documents shall be binding on and shall inure to the benefit of the Borrowers,
Investment Manager, the L/C Guarantors and their respective successors and
assigns (including, in the case of the Borrowers, a debtor-in-possession on
behalf of any Borrower), except as otherwise provided herein or therein. No
Borrower may assign, transfer, hypothecate or otherwise convey its rights,
benefits, obligations or duties hereunder or under any of the other Loan
Documents without the prior express written consent of Investment Manager and
the L/C Guarantors providing a majority in principal amount of the Letters of
Credit. Any such purported assignment, transfer, hypothecation or other
conveyance by any Borrower without the prior express written consent of
Investment Manager and the L/C Guarantors providing a majority in principal
amount of the Letters of Credit shall be void. The terms and provisions of this
Agreement are for the purpose of defining the relative rights and obligations of
the Borrowers, Investment Manager and the L/C Guarantors with respect to the
transactions contemplated hereby and no Person shall be a third party
beneficiary of any of the terms and provisions of this Agreement or any of the
other Loan Documents.

          10.10 No Fiduciary Relationship; Limited Liability. No provision in
the Loan Documents and no course of dealing between the parties shall be deemed
to create any fiduciary duty owing to any Borrower by Investment Manager or the
L/C Guarantors. Each Borrower agrees that neither Investment Manager nor any L/C
Guarantor shall have liability to such Borrower (whether sounding in tort,
contract or otherwise) for losses suffered by such Borrower in connection with,
arising out of, or in any way related to the transactions contemplated and the
relationship established by the Loan Documents, or any act, omission or event
occurring in connection therewith, unless and to the extent that it is
determined that such losses resulted from the gross negligence or willful
misconduct of the party from which recovery is sought as determined by a final
non-appealable order by a court of

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competent jurisdiction. Neither Investment Manager nor any L/C Guarantor shall
have any liability with respect to, and each Borrower hereby waives, releases
and agrees not to sue for, any special, indirect or consequential damages
suffered by Borrower in connection with, arising out of, or in any way related
to the Loan Documents or the transactions contemplated thereby.

          10.11 Construction. Investment Manager, the L/C Guarantors and the
Borrowers acknowledge that each of them has had the benefit of legal counsel of
its own choice and has been afforded an opportunity to review the Loan Documents
with its legal counsel and that the Loan Documents shall be construed as if
jointly drafted by Investment Manager, the L/C Guarantors and the Borrowers.

          10.12 Confidentiality. Investment Manager and the L/C Guarantors agree
to exercise reasonable efforts to keep confidential any non-public information
delivered pursuant to the Loan Documents and not to disclose such information to
Persons other than to potential assignees or participants or to Persons employed
by or engaged by Investment Manager or the L/C Guarantors or the L/C Guarantors’
assignees or participants including attorneys, auditors, professional
consultants, rating agencies, provided that each of the foregoing has agreed to
comply with confidentiality provisions substantially similar to those contained
herein. The confidentiality provisions contained in this Section 10.12 shall not
apply to disclosures (i) required to be made by Investment Manager or the L/C
Guarantors to any regulatory or governmental agency or pursuant to legal process
or (ii) consisting of general portfolio information that does not identify the
Borrowers or separately state information regarding the Borrowers. The
obligations of Investment Manager and the L/C Guarantors under this Section
10.12 shall supersede and replace the obligations of Investment Manager and the
L/C Guarantors under any confidentiality agreement in respect of this financing
executed and delivered by Investment Manager or the L/C Guarantors prior to the
date hereof.

          10.13 CONSENT TO JURISDICTION. EACH BORROWER HEREBY CONSENTS TO THE
JURISDICTION OF ANY STATE OR FEDERAL COURT LOCATED WITHIN THE STATE OF NEW YORK
AND IRREVOCABLY AGREE THAT, SUBJECT TO INVESTMENT MANAGER’S ELECTION, ALL
ACTIONS OR PROCEEDINGS ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE OTHER
LOAN DOCUMENTS SHALL BE LITIGATED IN SUCH COURTS. EACH BORROWER EXPRESSLY
SUBMITS AND CONSENTS TO THE JURISDICTION OF THE AFORESAID COURTS AND WAIVES ANY
DEFENSE OF FORUM NON CONVENIENS. EACH BORROWER HEREBY WAIVES PERSONAL SERVICE OF
ANY AND ALL PROCESS AND AGREES THAT ALL SUCH SERVICE OF PROCESS MAY BE MADE UPON
SUCH BORROWER BY CERTIFIED OR REGISTERED MAIL, RETURN RECEIPT REQUESTED,
ADDRESSED TO SUCH BORROWER, AT THE ADDRESS SET FORTH IN THIS AGREEMENT AND
SERVICE SO MADE SHALL BE COMPLETE TEN (10) DAYS AFTER THE SAME HAS BEEN POSTED.
IN ANY LITIGATION, TRIAL, ARBITRATION OR OTHER DISPUTE RESOLUTION PROCEEDING
RELATING TO THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS, ALL DIRECTORS,
OFFICERS, EMPLOYEES AND AGENTS OF EACH BORROWER SHALL BE DEEMED TO BE EMPLOYEES
OR MANAGING AGENTS OF SUCH BORROWER FOR PURPOSES OF ALL APPLICABLE LAW OR COURT
RULES REGARDING THE PRODUCTION OF WITNESSES BY NOTICE FOR TESTIMONY (WHETHER IN
A DEPOSITION, AT TRIAL OR OTHERWISE). EACH BORROWER AGREES THAT INVESTMENT
MANAGER’S OR THE L/C GUARANTORS’ COUNSELS IN ANY SUCH DISPUTE RESOLUTION
PROCEEDING MAY EXAMINE ANY OF THESE INDIVIDUALS AS IF UNDER CROSS-EXAMINATION
AND THAT ANY DISCOVERY DEPOSITION OF ANY OF

27

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

THEM MAY BE USED IN THAT PROCEEDING AS IF IT WERE AN EVIDENCE DEPOSITION. EACH
BORROWER IN ANY EVENT WILL USE ALL COMMERCIALLY REASONABLE EFFORTS TO PRODUCE IN
ANY SUCH DISPUTE RESOLUTION PROCEEDING, AT THE TIME AND IN THE MANNER REQUESTED
BY INVESTMENT MANAGER OR THE L/C GUARANTORS, ALL PERSONS, DOCUMENTS (WHETHER IN
TANGIBLE, ELECTRONIC OR OTHER FORM) OR OTHER THINGS UNDER THEIR CONTROL AND
RELATING TO THE DISPUTE.

          10.14 WAIVER OF JURY TRIAL. THE BORROWERS, INVESTMENT MANAGER OR THE
L/C GUARANTORS EACH HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY
CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT AND THE
OTHER LOAN DOCUMENTS. THE BORROWERS, INVESTMENT MANAGER AND THE L/C GUARANTORS
EACH ACKNOWLEDGE THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO ENTER INTO A
BUSINESS RELATIONSHIP, THAT EACH HAS RELIED ON THE WAIVER IN ENTERING INTO THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS AND THAT EACH WILL CONTINUE TO RELY ON
THE WAIVER IN THEIR RELATED FUTURE DEALINGS. THE BORROWERS, INVESTMENT MANAGER
AND THE L/C GUARANTORS EACH WARRANT AND REPRESENT THAT EACH HAS HAD THE
OPPORTUNITY OF REVIEWING THIS JURY WAIVER WITH LEGAL COUNSEL, AND THAT EACH
KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS.

          10.15 Survival of Warranties and Certain Agreements. All agreements,
representations and warranties made herein shall survive the execution and
delivery of this Agreement. Notwithstanding anything in this Agreement or
implied by law to the contrary, the agreements of Borrowers set forth in
Sections 2.3 and 10.1 shall survive the repayment of the Obligations and the
termination of this Agreement.

          10.16 Entire Agreement. This Agreement and the other Loan Documents
embody the entire agreement among the parties hereto and supersede all prior
commitments, agreements, representations, and understandings, whether oral or
written, relating to the subject matter hereof, and may not be contradicted or
varied by evidence of prior, contemporaneous, or subsequent oral agreements or
discussions of the parties hereto. All Exhibits, Schedules and Annexes referred
to herein are incorporated in this Agreement by reference and constitute a part
of this Agreement.

          10.17 Counterparts; Effectiveness. This Agreement and any amendments,
waivers, consents or supplements may be executed in any number of counterparts
and by different parties hereto in separate counterparts, each of which when so
executed and delivered shall be deemed an original, but all of which
counterparts together shall constitute but one in the same instrument. This
Agreement shall become effective upon the execution of a counterpart hereof by
each of the parties hereto.

          10.18 Delivery of Termination Statements and Mortgage Releases. Upon
payment in full in cash and performance of all of the Obligations (other than
indemnification Obligations), and a release of all claims against Investment
Manager and the L/C Guarantors, and so long as no suits, actions proceedings, or
claims are pending or threatened against any Indemnitee asserting any damages,
losses or liabilities that are indemnified liabilities hereunder, Investment
Manager shall deliver to the Borrowers termination statements, mortgage releases
and other documents necessary or appropriate to evidence the termination of the
Liens securing payment of the Obligations.

          10.19 Suretyship Waivers. The Borrowers shall be jointly and severally
liable for all

28

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

obligations hereunder. Each Borrower hereby expressly waives (a) diligence,
presentment, demand for payment, protest, benefit of any statute of limitations
affecting such Borrower’s liability under the Loan Documents; (b) discharge due
to any disability of any Borrower; (c) any defenses of any Borrower to
obligations under the Loan Documents not arising under the express terms of the
Loan Documents or from a material breach thereof by the L/C Guarantors which
under applicable law has the effect of discharging any Borrower from the
Obligations as to which this Agreement or any other Loan Document is sought to
be enforced; (d) the benefit of any act or omission by the L/C Guarantors which
directly or indirectly results in or aids the discharge of any Borrower from any
of the Obligations by operation of law or otherwise; (e) except as expressly
provided herein, all notices whatsoever, including notice of acceptance of the
incurring of the Obligations; (f) any right it may have to require the L/C
Guarantors to disclose to it any information that the L/C Guarantors may now or
hereafter acquire concerning the financial condition or any circumstances that
bears on the risk of nonpayment by any other Borrower, including the release of
such other Borrower from its Obligations hereunder; and (g) any requirement that
the L/C Guarantors exhaust any right, power or remedy or proceed against any
other Borrower or any other security for, or any guarantor of, or any other
party liable for, any of the Obligations, or any portion thereof. Each Borrower
specifically agrees that it shall not be necessary or required, and Borrowers
shall not be entitled to require, that the L/C Guarantors (i) file suit or
proceed to assert or obtain a claim for personal judgment against any other
Borrower for all or any part of the Obligations; (ii) make any effort at
collection or enforcement of all or any part of the Obligations from any
Borrower; (iii) foreclose against or seek to realize upon the Collateral or any
other security now or hereafter existing for all or any part of the Obligations;
(iv) file suit or proceed to obtain or assert a claim for personal judgment
against any Borrower or any guarantor or other party liable for all or any part
of the Obligations; (v) exercise or assert any other right or remedy to which
the L/C Guarantors are or may be entitled in connection with the Obligations or
any security or guaranty relating thereto to assert; or (vi) file any claim
against assets of one Borrower before or as a condition of enforcing the
liability of any other Borrower under this Agreement. WITHOUT LIMITING THE
FOREGOING IN ANY WAY, EACH BORROWER HEREBY IRREVOCABLY WAIVES AND RELEASES:

                              (i) Any and all rights it may have at any time
(whether arising directly or indirectly, by operation of law, contract or
otherwise) to require the marshaling of any assets of any Borrower, which right
of marshaling might otherwise arise from any such payments made or obligations
performed;

                               (ii) Any and all rights that would result in such
Borrower being deemed a “creditor” under the United States Code of any other
Borrower or any other Person, on account of payments made or obligations
performed by such Borrower; and

          Until such time as the Obligations have been satisfied in full, any
claim, right or remedy which it may now have or hereafter acquire against any
other Borrower that arises hereunder and/or from the performance by it hereunder
including any claim, remedy or right of subrogation, reimbursement, exoneration,
contribution, indemnification, or participation in any claim, right or remedy of
the L/C Guarantors against any other Borrower or any collateral security which
the L/C Guarantors now have or may hereafter acquire, whether or not such claim,
right or remedy arises in equity, under contract, by statute, under common law
or otherwise.

          10.20 Subordination to Senior Indebtedness. This Agreement is subject
to the terms of the Subordination Agreement, which agreement is incorporated
herein by reference. Notwithstanding any

29

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

statement to the contrary contained in this Agreement, no remedies shall be
pursued, except in accordance with the terms of such agreement. Notwithstanding
the incorporation by reference of the Subordination Agreement, the Borrowers
acknowledge that no other parties, including any Borrower or any of their
successors or assigns, are intended to be benefited, in any way, by the
Subordination Agreement. If MTM refinances or renegotiates the Senior
Indebtedness or replaces it with other Senior Indebtedness, Investment Manager
and the L/C Guarantors hereby agree to enter into any subordination agreement
requested by any Person or Persons who are MTM’s Senior Lenders or agents
therefor, pursuant to which Investment Manager and the L/C Guarantors agree to
subordinate their respective rights and interests hereunder and the liens
securing same to such Person, on terms consistent with or no less favorable to
Investment Manager and the L/C Guarantors than those contained in the
Subordination Agreement and the subordination agreement of even date herewith by
and between Investment Manager and the holders of Subordinated Debt.

[Signature Pages to Follow]

30

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

          IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed as of the day and year first above written.

The Borrowers:

 

 

 

 

 

MTM TECHNOLOGIES, INC.,

 

 

 

 

 

a New York corporation

 

 

 

 

 

By:

 

/s/ Steven Stringer

 

 

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

 

Name:

Steven Stringer

 

 

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

 

 

 

 

Title:

President and Chief Executive Officer

 

 

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

 

 

 

 

 

MTM TECHNOLOGIES (US), INC.,

 

 

 

 

 

a Delaware corporation

 

 

 

By:

 

/s/ Steven Stringer

 

 

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

 

Name:

Steven Stringer

 

 

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

 

 

 

 

Title:

President and Chief Executive Officer

 

 

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

 

 

 

 

 

INFO SYSTEMS, INC.,

 

 

 

 

 

a Delaware corporation

 

 

 

By:

 

/s/ Steven Stringer

 

 

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

 

Name:

Steven Stringer

 

 

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

 

 

 

 

Title:

President and Chief Executive Officer

 

 

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

 

 

 

 

 

MTM TECHNOLOGIES (MASSACHUSETTS), LLC,

 

 

 

 

 

a Delaware limited liability company

 

 

 

By:

 

/s/ Steven Stringer

 

 

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

 

Name:

Steven Stringer

 

 

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

 

 

 

 

Title:

President and Chief Executive Officer

 

 

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

1

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

 

 

 

 

Investment Manager:

 

 

 

COLUMBIA PARTNERS, L.L.C. INVESTMENT
MANAGEMENT

 

 

 

By:

 

/s/ Jason Crist

 

 

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

 

Name:

Jason Crist

 

 

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

 

 

 

 

Title:

Managing Director

 

 

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

 

 

 

 

The L/C Guarantors:

 

 

NATIONAL ELECTRICAL BENEFIT FUND

 

 

 

By: Columbia Partners, L.L.C. Investment Management,
its Authorized Signatory

 

 

 

By:

 

/s/ Jason Crist

 

 

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

 

Name:

Jason Crist

 

 

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

 

 

 

 

Title:

Managing Director

 

 

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

 

 

 

 

 

FIRSTMARK III L.P.

 

 

 

By: FirstMark Capital LLC, its Investment Manager

 

 

 

By:

 

/s/ Gerald A. Poch

 

 

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

 

Name:

Gerald A. Poch

 

 

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

 

 

 

 

Title:

Chairman and Managing Director

 

 

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

 

 

 

 

 

FIRSTMARK III OFFSHORE PARTNERS, L.P.

 

 

 

By: FirstMark Capital LLC, its Investment Manager

 

 

 

 

 

By:

 

/s/ Gerald A. Poch

 

 

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

 

Name:

Gerald A. Poch

 

 

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

 

 

 

 

Title:

Chairman and Managing Director

 

 

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

2

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

 

 

 

 

 

CONSTELLATION VENTURE CAPITAL II, L.P.

 

 

 

By: Constellation Ventures Management II, LLC, its
General Partner

 

 

 

 

 

By:

 

/s/ Tom Wasserman

 

 

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

 

Name:

Tom Wasserman

 

 

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

 

 

 

 

Title:

Chairman and Managing Director

 

 

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

 

 

 

 

 

CONSTELLATION VENTURE CAPITAL OFFSHORE II, L.P.

 

 

 

By: Constellation Ventures Management II, LLC, its
General Partner

 

 

 

 

 

By:

 

/s/ Tom Wasserman

 

 

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

 

Name:

Tom Wasserman

 

 

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

 

 

 

 

Title:

Chairman and Managing Director

 

 

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

 

 

 

 

 

CVC II PARTNERS, LLC

 

 

 

By: The Bear Stearns Companies Inc., its Managing Member

 

 

 

 

 

By:

 

/s/ Tom Wasserman

 

 

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

 

Name:

Tom Wasserman

 

 

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

 

 

 

 

Title:

Chairman and Managing Director

 

 

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

 

 

 

 

 

THE BSC EMPLOYEE FUND VI, L.P.

 

 

 

By: Constellation Ventures Management II, LLC, its
General Partner

 

 

 

 

 

By:

 

/s/ Tom Wasserman

 

 

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

 

Name:

Tom Wasserman

 

 

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

 

 

 

 

Title:

Chairman and Managing Director

 

 

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

3

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

Schedule of L/Cs

 

 

 

 

 

 

 

 

L/C GUARANTORS

 

Letter of Credit
Amounts

 

Percentage of
Total Letter of
Credit
Amounts

 

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

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

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

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

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

 

NATIONAL ELECTRICAL BENEFIT FUND

 

$

7,000,000.00

 

82.35

%

 

FIRSTMARK III L.P.

 

$

876,450.00

 

10.32

%

 

FIRSTMARK III OFFSHORE PARTNERS, L.P.

 

$

123,550.00

 

1.45

%

 

CONSTELLATION VENTURE CAPITAL II, L.P.

 

$

23,360.41

 

0.28

%

 

CONSTELLATION VENTURE CAPITAL OFFSHORE II, L.P.

 

$

123,549.13

 

1.45

%

 

CVC II PARTNERS, LLC

 

$

11,162.42

 

0.13

%

 

THE BSC EMPLOYEE FUND VI, L.P.

 

$

341,928.04

 

4.02

%

 

 

 

 

 

 

 

 

 

 

 

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

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

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

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

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

 

Total:

 

$

8,500,000.00

 

100

%

 

 

 

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

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

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

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

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

 

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

ANNEX A
to
LETTER OF CREDIT COMMITMENT AND REIMBURSEMENT AGREEMENT

DEFINITIONS

          Capitalized terms used in the Loan Documents shall have (unless
otherwise provided elsewhere in the Loan Documents) the following respective
meanings and all references to Sections, Exhibits, Schedules or Annexes in the
following definitions shall refer to Sections, Exhibits, Schedules or Annexes of
or to the Agreement:

          “Accounting Changes” means: (a) changes in accounting principles
required by GAAP and implemented by any Borrower; and (b) changes in accounting
principles recommended by the Borrowers’ certified public accountants and
implemented by any Borrower.

          “Affiliate” means, with respect to any Person, (a) each Person that,
directly or indirectly, owns or controls, whether beneficially, or as a trustee,
guardian or other fiduciary, 5% or more of the Stock having ordinary voting
power in the election of directors of such Person, (b) each Person that
controls, is controlled by or is under common control with such Person, (c) each
of such Person’s officers, directors, joint venturers and partners and (d) in
the case of Borrower, the immediate family members, spouses and lineal
descendants of individuals who are Affiliates of Borrower. For the purposes of
this definition, “control” of a Person shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of its management or
policies, whether through the ownership of voting securities, by contract or
otherwise; provided, however, that the term “Affiliate” shall specifically
exclude Investment Manager and the L/C Guarantors.

          “Agreement” means this Letter of Credit Commitment and Reimbursement
Agreement (including all schedules, subschedules, annexes and exhibits hereto),
as the same may be amended, supplemented, restated or otherwise modified from
time to time.

          “Bankruptcy Code” means the provisions of Title 11 of the United
States Code, 11 U.S.C. §§ 101 et seq. or any other applicable bankruptcy,
insolvency or similar laws.

          “Borrowers” has the meaning ascribed to it in the Preamble.

          “Business Day” means any day that is not a Saturday, a Sunday or a day
on which banks are required or permitted to be closed in the State of New York.

          “Capital Lease” means, with respect to any Borrower, any lease of any
property (whether real, personal or mixed) by such Borrower as lessee that, in
accordance with GAAP, would be required to be classified and accounted for as a
capital lease on a balance sheet of MTM.

          “Capital Lease Obligation” means, with respect to any Capital Lease of
any Person, the amount of the obligation of the lessee thereunder that, in
accordance with GAAP, would appear on a balance sheet of such lessee in respect
of such Capital Lease.

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

          “Casualty Proceeds” means (a) payments or other proceeds from an
insurance carrier with respect to any loss, casualty or damage to Collateral,
and (b) payments received on account of any condemnation or other governmental
taking of any of the Collateral.

          “CDF” means GE Commercial Distribution Finance Corporation, as
administrative agent for itself and the other lenders under the CDF Agreement.

          “CDF Agreement” means that certain Credit Facilities Agreement dated
August 21, 2007, by and among CDF, the Borrowers and the other parties thereto,
as amended, modified, restated or replaced from time to time.

          “Change of Control” means (i) a sale, lease, license or other
disposition of all or substantially all of the assets of MTM, (ii) the
acquisition by any person or group (as such term is used in Section 13(d) or
14(d) of the Securities Exchange Act of 1934, as amended), other than one or
more of the institutional investors that are the L/C Guarantors and that own
voting stock of MTM on the Closing Date, of beneficial ownership of more than
50% of the voting power of the total issued and outstanding shares of voting
stock of MTM, or (iii) MTM shall cease to own directly, or indirectly through
one or more of the other Borrowers, 100% of the total issued and outstanding
capital stock of each of the other Borrowers; provided, however, that, nothing
herein shall be construed as a waiver of MTM’s or any other Borrower’s
obligations under Sections 6.4, 6.6 or 6.7 in connection with the transfer of
the capital stock of any Borrower to another Borrower or any other corporate
restructuring.

          “Charges” means all federal, state, county, city, municipal, local,
foreign or other governmental taxes (including premiums and other amounts owed
to the PBGC at the time due and payable), levies, assessments, charges, liens,
claims or encumbrances upon or relating to (a) the Collateral, (b) the
Obligations, (c) the employees, payroll, income or gross receipts of the
Borrowers, (d) the Borrowers’ ownership or use of any properties or other
assets, or (e) any other aspect of the Borrowers’ businesses.

          “Closing” has the meaning ascribed to it in Section 1.2.

          “Closing Date” has the meaning ascribed to it in the Preamble.

          “Code” means the Uniform Commercial Code as the same may, from time to
time, be enacted and in effect in the State of New York; provided, that to the
extent that the Code is used to define any term herein or in any Loan Document
and such term is defined differently in different Articles or Divisions of the
Code, the definition of such term contained in Article or Division 9 shall
govern; provided further, that in the event that, by reason of mandatory
provisions of law, any or all of the attachment, perfection or priority of, or
remedies with respect to, Investment Manager’s or the L/C Guarantors’ Lien on
any Collateral is governed by the Uniform Commercial Code as enacted and in
effect in a jurisdiction other than the State of New York, the term “Code” shall
mean the Uniform Commercial Code as enacted and in effect in such other
jurisdiction solely for purposes of the provisions thereof relating to such
attachment, perfection, priority or remedies and for purposes of definitions
related to such provisions.

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

          “Collateral” means the “Collateral” as defined in the Security
Agreement and the other Collateral Documents and any other property, real or
personal, tangible or intangible, now existing or hereafter acquired, that may
at any time be or become subject to a security interest or Lien in favor of, or
for the benefit of, Investment Manager or the L/C Guarantors, to secure the
Obligations or any portion thereof.

          “Collateral Documents” means the Security Agreement, the Pledge
Agreements, the Intellectual Property Security Agreement and all similar
agreements entered into guaranteeing payment of, or granting a Lien upon
property as security for payment of, the Obligations or any portion thereof.

          “Contingent Obligation” means, as applied to any Person, means any
direct or indirect liability of that Person: (i) with respect to Guaranteed
Indebtedness and with respect to any Indebtedness, lease, dividend or other
obligation of another Person if the purpose or intent of the Person incurring
such liability, or the effect thereof, is to provide assurance to the obligee of
such liability that such liability will be paid or discharged, or that any
agreements relating thereto will be complied with, or that the holders of such
liability will be protected (in whole or in part) against loss with respect
thereto; (ii) any agreement, contract or transaction involving commodity options
or future contracts, (iii) to make take-or-pay or similar payments if required
regardless of nonperformance by any other party or parties to an agreement, or
(iv) pursuant to any agreement to purchase, repurchase or otherwise acquire any
obligation or any property constituting security therefor, to provide funds for
the payment or discharge of such obligation or to maintain the solvency,
financial condition or any balance sheet item or level of income of another. The
amount of any Contingent Obligation shall be equal to the amount of the
obligation so guaranteed or otherwise supported or, if not a fixed and
determined amount, the maximum amount so guaranteed.

          “Contractual Obligations” means, as applied to any Person, any
indenture, mortgage, deed of trust, contract, undertaking, agreement or other
instrument to which that Person is a party or by which it or any of its
properties is bound or to which it or any of its properties is subject.

          “Copyright License” means any and all rights now owned or hereafter
acquired by any Borrower under any written agreement granting any right to use
any Copyright or Copyright registration.

          “Copyrights” means all of the following now owned or hereafter adopted
or acquired by any Borrower: (a) all copyrights and General Intangibles of like
nature (whether registered or unregistered), all registrations and recordings
thereof, and all applications in connection therewith, including all
registrations, recordings and applications in the United States Copyright Office
or in any similar office or agency of the United States, any state or territory
thereof, or any other country or any political subdivision thereof; and (b) all
reissues, extensions or renewals thereof.

          “Default” means any event that, with the passage of time or notice or
both, would, unless cured or waived, become an Event of Default.

          “Disclosure Schedules” means the Schedules prepared by Borrowers and
denominated as Schedules 4.3(a) through 6.12 in the index to the Agreement.

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

          “Dollars” or “$” means lawful currency of the United States of
America.

          “Drawing Fee” has the meaning ascribed to it in Section 2.2(c).

          “Environmental Laws” means all applicable federal, state, local and
foreign laws, statutes, ordinances, codes, rules, standards and regulations, now
or hereafter in effect, and any applicable judicial or administrative
interpretation thereof, including any applicable judicial or administrative
order, consent decree, order or judgment, imposing liability or standards of
conduct for or relating to the regulation and protection of human health,
safety, the environment and natural resources (including ambient air, surface
water, groundwater, wetlands, land surface or subsurface strata, wildlife,
aquatic species and vegetation). Environmental Laws include the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980 (42 U.S.C. §§
9601 et seq.) (“CERCLA”); the Hazardous Materials Transportation Authorization
Act of 1994 (49 U.S.C. §§ 5101 et seq.); the Federal Insecticide, Fungicide, and
Rodenticide Act (7 U.S.C. §§ 136 et seq.); the Solid Waste Disposal Act (42
U.S.C. §§ 6901 et seq.); the Toxic Substance Control Act (15 U.S.C. §§ 2601 et
seq.); the Clean Air Act (42 U.S.C. §§ 7401 et seq.); the Federal Water
Pollution Control Act (33 U.S.C. §§ 1251 et seq.); the Occupational Safety and
Health Act (29 U.S.C. §§ 651 et seq.); and the Safe Drinking Water Act (42
U.S.C. §§ 300(f) et seq.), and any and all regulations promulgated thereunder,
and all analogous state, local and foreign counterparts or equivalents and any
transfer of ownership notification or approval statutes.

          “Environmental Permits” means all permits, licenses, authorizations,
certificates, approvals or registrations required by any Governmental Authority
under any Environmental Laws.

          “Equipment” means all “equipment,” as such term is defined in the
Code, now owned or hereafter acquired by any Borrower, wherever located and, in
any event, including all of the Borrowers’ machinery and equipment, including
processing equipment, conveyors, machine tools, data processing and computer
equipment, including embedded software and peripheral equipment and all
engineering, processing and manufacturing equipment, office machinery,
furniture, materials handling equipment, tools, attachments, accessories,
automotive equipment, trailers, trucks, forklifts, molds, dies, stamps, motor
vehicles, rolling stock and other equipment of every kind and nature, trade
fixtures and fixtures not forming a part of real property, together with all
additions and accessions thereto, replacements therefor, all parts therefor, all
substitutes for any of the foregoing, fuel therefor, and all manuals, drawings,
instructions, warranties and rights with respect thereto, and all products and
proceeds thereof and condemnation awards and insurance proceeds with respect
thereto.

          “ERISA” means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any regulations promulgated thereunder.

          “ERISA Affiliate” means, with respect to any Borrower, any trade or
business (whether or not incorporated) that, together with such Borrower, are
treated as a single employer within the meaning of Sections 414(b), (c) or (m)
of the IRC.

          “ERISA Event” means, with respect to any Borrower or any ERISA
Affiliate, (a) any event described in Section 4043(c) of ERISA with respect to a
Title IV Plan; (b) the withdrawal

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

of any Borrower or ERISA Affiliate from a Title IV Plan subject to Section 4063
of ERISA during a plan year in which it was a substantial employer, as defined
in Section 4001(a)(2) of ERISA; (c) the complete or partial withdrawal of any
Borrower or any ERISA Affiliate from any Multiemployer Plan; (d) the filing of a
notice of intent to terminate a Title IV Plan or the treatment of a plan
amendment as a termination under Section 4041 of ERISA; (e) the institution of
proceedings to terminate a Title IV Plan or Multiemployer Plan by the PBGC; (f)
the failure by any Borrower or ERISA Affiliate to make when due required
contributions to a Multiemployer Plan or Title IV Plan unless such failure is
cured within 30 days; (g) any other event or condition that might reasonably be
expected to constitute grounds under Section 4042 of ERISA for the termination
of, or the appointment of a trustee to administer, any Title IV Plan or
Multiemployer Plan or for the imposition of liability under Section 4069 or
4212(c) of ERISA; (h) the termination of a Multiemployer Plan under Section
4041A of ERISA or the reorganization or insolvency of a Multiemployer Plan under
Section 4241 or 4245 of ERISA; or (i) the final determination that a Qualified
Plan’s qualification or tax exempt status should be revoked; or (j) the
termination of a Plan described in Section 4064 of ERISA.

          “Event of Default” has the meaning ascribed to it in Section 8.1.

          “Facility Fee” has the meaning ascribed to it in Section 2.2(a).

          “Fees” means any and all fees payable to Investment Manager or the L/C
Guarantors pursuant to the Agreement or any of the other Loan Documents,
including without limitation, the Facility Fees, Success Fee and Drawing Fee.

          “Financial Statements” means the consolidated and consolidating income
statements, statements of cash flows and balance sheets of the Borrowers and
their Subsidiaries.

          “Fixtures” means all “fixtures” as such term is defined in the Code,
now owned or hereafter acquired by any Borrower.

          “GAAP” means generally accepted accounting principles in the United
States of America, consistently applied.

          “General Intangibles” means “general intangibles,” as such term is
defined in the Code, now owned or hereafter acquired by any Borrower, including
all right, title and interest that any Borrower may now or hereafter have in or
under any Contractual Obligation, all payment intangibles, customer lists,
Licenses, Copyrights, Trademarks, Patents, and all applications therefor and
reissues, extensions or renewals thereof, rights in Intellectual Property,
interests in partnerships, joint ventures and other business associations,
licenses, permits, copyrights, trade secrets, proprietary or confidential
information, inventions (whether or not patented or patentable), technical
information, procedures, designs, knowledge, know how, software, data bases,
data, skill, expertise, experience, processes, models, drawings, materials and
records, goodwill (including the goodwill associated with any Trademark or
Trademark License), all rights and claims in or under insurance policies
(including insurance for fire, damage, loss and casualty, whether covering
personal property, real property, tangible rights or intangible rights, all
liability, life, key man and business interruption insurance, and all unearned
premiums), uncertificated securities, chooses in action, deposit, checking and
other bank accounts, rights to receive tax refunds and other payments, rights to
receive dividends, distributions, cash,

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instruments and other property in respect of or in exchange for pledged Stock
and Investment Property, rights of indemnification, all books and records,
correspondence, credit files, invoices and other papers, including all tapes,
cards, computer runs and other papers and documents in the possession or under
the control of any Borrower or any computer bureau or service company from time
to time acting for any Borrower.

          “Governmental Authority” means any nation or government, any state or
other political subdivision thereof, and any agency, department or other entity
exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government.

          “Guaranteed Indebtedness” means, as to any Person, any obligation of
such Person guaranteeing, providing comfort or otherwise supporting any
Indebtedness, lease, dividend, or other obligation (“primary obligation”) of any
other Person (the “primary obligor”) in any manner, including any obligation or
arrangement of such Person to (a) purchase or repurchase any such primary
obligation, (b) advance or supply funds (i) for the purchase or payment of any
such primary obligation or (ii) to maintain working capital or equity capital of
the primary obligor or otherwise to maintain the net worth or solvency or any
balance sheet condition of the primary obligor, (c) purchase property,
securities or services primarily for the purpose of assuring the owner of any
such primary obligation of the ability of the primary obligor to make payment of
such primary obligation, (d) protect the beneficiary of such arrangement from
loss (other than product warranties given in the ordinary course of business) or
(e) indemnify the owner of such primary obligation against loss in respect
thereof. The amount of any Guaranteed Indebtedness at any time shall be deemed
to be an amount equal to the lesser at such time of (x) the stated or
determinable amount of the primary obligation in respect of which such
Guaranteed Indebtedness is incurred and (y) the maximum amount for which such
Person may be liable pursuant to the terms of the instrument embodying such
Guaranteed Indebtedness, or, if not stated or determinable, the maximum
reasonably anticipated liability (assuming full performance) in respect thereof.

          “Hazardous Material” means any substance, material or waste that is
regulated by, or forms the basis of liability now or hereafter under, any
Environmental Laws, including any material or substance that is (a) defined as a
“solid waste,” “hazardous waste,” “hazardous material,” “hazardous substance,”
“extremely hazardous waste,” “restricted hazardous waste,” “pollutant,”
“contaminant,” “hazardous constituent,” “special waste,” “toxic substance” or
other similar term or phrase under any Environmental Laws, or (b) petroleum or
any fraction or by product thereof, asbestos, polychlorinated biphenyls (PCB’s),
or any radioactive substance.

          “Indebtedness” means, with respect to any Person, without duplication
(a) all indebtedness of such Person for borrowed money or for the deferred
purchase price of property payment for which is deferred six (6) months or more,
but excluding obligations to trade creditors incurred in the ordinary course of
business that are unsecured and not overdue by more than six (6) months unless
being contested in good faith, (b) all reimbursement and other obligations with
respect to letters of credit, bankers’ acceptances and surety bonds, whether or
not matured, (c) all obligations evidenced by notes, bonds, debentures or
similar instruments, (d) all indebtedness created or arising under any
conditional sale or other title retention agreement with respect to property
acquired by such Person (even though the rights and remedies of the seller or
lender under such agreement in the event of default are limited to repossession
or sale of

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such property), (e) all Capital Lease Obligations, (f) all obligations of such
Person under commodity purchase or option agreements or other commodity price
hedging arrangements, in each case whether contingent or matured, (g) all
obligations of such Person under any foreign exchange contract, currency swap
agreement, interest rate swap, cap or collar agreement or other similar
agreement or arrangement designed to alter the risks of that Person arising from
fluctuations in currency values or interest rates, in each case whether
contingent or matured, (h) all Indebtedness referred to above secured by (or for
which the holder of such Indebtedness has an existing right, contingent or
otherwise, to be secured by) any Lien upon or in property or other assets
(including accounts and contract rights) owned by such Person, even though such
Person has not assumed or become liable for the payment of such Indebtedness,
(i) “earnouts” and similar payment obligations, except for such obligations
which are payable solely in Stock, (j) Contingent Obligations, and (k) the
Obligations.

          “Indemnitees” has the meaning ascribed to it in Section 10.1.

          “Intellectual Property” means any and all Licenses, Patents,
Copyrights, Trademarks, and the goodwill associated with such Trademarks.

          “Intellectual Property Security Agreement” means the Intellectual
Property Security Agreement made in favor of Investment Manager, for the benefit
of itself and the L/C Guarantors, by the Borrowers.

          “Inventory” means any “inventory,” as such term is defined in the
Code, now owned or hereafter acquired by any Borrower, wherever located,
including inventory, merchandise, goods and other personal property that are
held by or on behalf of any Borrower for sale or lease or are furnished or are
to be furnished under a contract of service, or that constitute raw materials,
work in process, finished goods, returned goods, supplies or materials of any
kind, nature or description used or consumed or to be used or consumed in
Borrower’s business or in the processing, production, packaging, promotion,
delivery or shipping of the same, including all supplies and embedded software.

          “Investment Manager” means Columbia Partners, L.L.C. Investment
Management in its capacity as Investment Manager for the L/C Guarantors or its
successor appointed pursuant to Section 9.3.

          “Investment Property” means all “investment property,” as such term is
defined in the Code, now owned or hereafter acquired by any Borrower, wherever
located, including: (i) all securities, whether certificated or uncertificated,
including stocks, bonds, interests in limited liability companies, partnership
interests, treasuries, certificates of deposit, and mutual fund shares; (ii) all
securities entitlements of any Borrower, including the rights of any Borrower to
any securities account and the financial assets held by a securities
intermediary in such securities account and any free credit balance or other
money owing by any securities intermediary with respect to that account; (iii)
all securities accounts of any Borrower; (iv) all commodity contracts of any
Borrower; and (v) all commodity accounts held by any Borrower.

          “IRC” means the Internal Revenue Code of 1986, as amended, and all
regulations promulgated thereunder.

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          “IRR” means, with respect to the calculation of a Drawing Fee then due
or owing pursuant to the terms of this Agreement, a referenced interest rate
that, when used as a discount rate, causes (a) the net present value (as of the
date of a Drawing) of the aggregate payments made by the Borrowers of principal,
any accrued interest and the applicable Drawing Fee from the date of such
Drawing through the payment date to which the applicable Drawing Fee relates
(excluding, for avoidance of doubt, all others payments, including the Facility
Fee, Success Fee and other fees and expenses), to equal (b) the net present
value (as of the date of such Drawing) of principal of the Letter(s) of Credit
provided by the L/C Guarantor from the date of such Drawing through the payment
date to which the applicable Drawing Fee relates.

          “IRS” means the Internal Revenue Service.

          “L/C Guarantor(s)” has the meaning set forth in the Preamble.

          “Letters of Credit” has the meaning ascribed to it in the Recitals.

          “License” means any Copyright License, Patent License, Trademark
License or other license of rights or interests now held or hereafter acquired
by any Borrower.

          “Lien” means any mortgage or deed of trust, pledge, hypothecation,
assignment, deposit arrangement, lien, charge, claim, security interest,
easement or encumbrance, or preference, priority or other security agreement or
preferential arrangement of any kind or nature whatsoever (including any lease
or title retention agreement, any financing lease having substantially the same
economic effect as any of the foregoing, and the filing of, or agreement to
give, any financing statement perfecting a security interest under the Code or
comparable law of any jurisdiction).

          “Liquidity Event” means the issuance after the Closing Date by any
Borrower of indebtedness for borrowed money or the sale by any Borrower of
equity securities in a public offering or in a private sale to a Person that is
not a Borrower for cash in which such Borrower receives aggregate net proceeds
in excess of Twenty-Five Million Dollars ($25,000,000); provided none of the
following events shall constitute a Liquidity Event: (i) the issuance of equity
securities in connection with MTM’s Series A Preferred Stock (including upon
conversion of such stock, the payment of “in kind” dividends, the issuance of
shares upon the exercise of warrants or the operation of anti-dilution
provisions), (ii) the issuance, vesting or exercise of board, employee,
management and consultant equity incentives, (iii) the incurrence by Borrowers
of Senior Indebtedness, the Obligations, or short term inventory, receivables or
vendor financing, (iv) the issuance of acquisition consideration and related
earn-outs, notes and similar payments, or (v) the issuance of securities upon
the exercise of any warrant issued by MTM on or prior to the Closing Date.

          “Litigation” has the meaning ascribed to it in Section 7.1(d).

          “Loan Documents” means the Agreement, the Collateral Documents and all
other agreements, instruments, documents and certificates executed and delivered
to, or in favor of, Investment Manager or the L/C Guarantors and including all
other pledges, powers of attorney, consents, assignments, contracts, notices,
and all other written matter whether now or hereafter executed by or on behalf
of any Borrower and delivered to Investment Manager or the L/C

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Guarantors in connection with the Agreement or the transactions contemplated
hereby. Any reference in the Agreement or any other Loan Document to a Loan
Document shall include all appendices, exhibits or schedules thereto, and all
amendments, restatements, supplements or other modifications thereto, and shall
refer to the Agreement or such Loan Document as the same may be in effect at any
and all times such reference becomes operative.

          “Material Adverse Effect” means a material adverse effect on (a) the
business, assets, operations, prospects or financial or other condition of
Borrowers taken as a whole, (b) the Borrowers’ ability to pay any of the
Reimbursement Payments or pay, or perform any of the other Obligations in
accordance with the terms of the Agreement and the other Loan Documents, (c) the
Collateral or Investment Manager’s Liens, on behalf of itself and the L/C
Guarantors, on the Collateral or the priority of such Liens, or (d) Investment
Manager’s or the L/C Guarantors’ rights and remedies under the Agreement and the
other Loan Documents.

          “Material Agreement” means any written contract, agreement,
instrument, commitment or other written arrangement to which any Borrower is a
party, the absence of which would reasonably be expected to have a Material
Adverse Effect (other than the Loan Documents).

          “Multiemployer Plan” means a “multiemployer plan” as defined in
Section 4001(a)(3) of ERISA, and to which the Borrowers or any ERISA Affiliate
is making, is obligated to make or has made or been obligated to make,
contributions on behalf of participants who are or were employed by any of them.

          “Obligations” means all loans, advances, debts, liabilities and
obligations, for the performance of covenants, tasks or duties or for payment of
monetary amounts (whether or not such performance is then required or
contingent, or such amounts are liquidated or determinable), owing by any
Borrower to Investment Manager or the L/C Guarantors, and all covenants and
duties regarding such amounts, of any kind or nature, present or future, whether
or not evidenced by any note, agreement or other instrument, in each case,
arising under the Agreement or any of the other Loan Documents. This term
includes all principal, interest (including all interest that accrues after the
commencement of any case or proceeding by or against any Borrower in bankruptcy,
whether or not allowed in such case or proceeding), Fees, Charges, expenses,
attorneys’ fees and any other sum chargeable to any Borrower under the Agreement
or any of the other Loan Documents.

          “Patent License” means rights under any written agreement now owned or
hereafter acquired by any Borrower granting any right with respect to any
invention on which a Patent is in existence.

          “Patents” means all of the following in which any Borrower now holds
or hereafter acquires any interest: (a) all letters patent of the United States
or any other country, all registrations and recordings thereof, and all
applications for letters patent of the United States or of any other country,
including registrations, recordings and applications in the United States Patent
and Trademark Office or in any similar office or agency of the United States,
any State or any other country, and (b) all reissues, continuations,
continuations in part or extensions thereof.

          “PBGC” means the Pension Benefit Guaranty Corporation.

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          “Pension Plan” means a Plan described in Section 3(2) of ERISA.

          “Perfection Certificate” shall have the meaning ascribed to it in the
Security Agreement.

          “Permitted Distributions” shall mean (a) dividends declared and paid
in cash by any subsidiary of MTM to MTM, and by any subsidiary of a Borrower
(other than MTM) to such Borrower; (b) purchases, acquisitions, redemptions,
retirements and dividends payable solely in stock or other equity interests of
any Borrower and (c) cash dividends payable with respect to MTM’s Series A
Preferred Stock.

          “Permitted Encumbrances” means the following encumbrances: (a) all
Liens existing on the Closing Date on Equipment and Real Estate; (b) Purchase
Money Liens; (c) statutory Liens of landlords and Liens of carriers,
warehousemen, bailees, mechanics, materialmen and other like Liens imposed by
law, created in the ordinary course of business and securing amounts not yet due
(or which are being contested in good faith, by appropriate proceedings or other
appropriate actions which are sufficient to prevent imminent foreclosure of such
Liens), and with respect to which adequate reserves or other appropriate
provisions are being maintained by the applicable Borrower in accordance with
GAAP; (d) deposits made (and the Liens thereon) in the ordinary course of
business of the applicable Borrower (including, without limitation, security
deposits for leases, indemnity bonds, surety bonds and appeal bonds) in
connection with workers’ compensation, unemployment insurance and other types of
social security benefits or to secure the performance of tenders, bids,
contracts (other than for the repayment or guarantee of borrowed money or
purchase money obligations), statutory obligations and other similar obligations
arising as a result of progress payments under government contracts; (e) Liens
granted to Investment Manager, for the benefit of Investment Manager and the L/C
Guarantors, by each Borrower; (f) Liens of judgment creditors, provided that
such Liens do not exceed $100,000 in the aggregate at any time (other than Liens
bonded or insured to the reasonable satisfaction of Investment Manager); (g)
Permitted Tax Liens; (h) easements (including, without limitation, reciprocal
easement agreements and utility agreements), encroachments, minor defects or
irregularities in title, variation and other restrictions, charges or
encumbrances (whether or not recorded) affecting the Real Estate, if applicable,
and which in the aggregate (i) do not materially interfere with the occupation,
use or enjoyment by any Borrower of its business or property so encumbered and
(ii) in the reasonable business judgment of Investment Manager, do not
materially and adversely affect the value of such Real Estate; (i) Liens granted
by one or more of the Borrowers on personal and/or real property to secure the
payment and performance of Senior Indebtedness; (j) Liens granted by one or more
of the Borrowers on personal and/or real property to secure the payment and
performance of Subordinated Debt; and (k) bid and performance bonds and Liens in
respect thereof in the ordinary course of business and in an aggregate amount
not to exceed $5,000,000 outstanding at any time, on reasonable and customary
terms.

          “Permitted Indebtedness” means (a) current Indebtedness maturing in
less than one year and incurred in the ordinary course of business for raw
materials, supplies, equipment, services, Taxes or labor; (b) Indebtedness
secured by Purchase Money Liens; (c) Indebtedness arising under this Agreement;
(d) deferred Taxes and other expenses incurred in the ordinary course of
business; (e) Subordinated Debt; (f) Senior Indebtedness; (g) other Indebtedness
existing on the Closing Date and listed on Schedule 6.2 attached hereto;
(h) guarantees of Capital Leases; and (i) unsecured guarantees by any Borrower
of any Indebtedness or other obligation of any other

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Borrower permitted hereunder or of obligations under any real property lease for
premises occupied by any Borrower; (j) bid and performance bonds in the ordinary
course of business and in an aggregate amount not to exceed $5,000,000
outstanding at any time, on reasonable and customary terms; and (k) all
reimbursement and other obligations with respect to letters of credit, bankers’
acceptances and surety bonds, whether or not matured.

          “Permitted Tax Liens” means liens for Taxes not due and payable and
liens for Taxes that the applicable Borrower is contesting in good faith, by
appropriate proceedings which are sufficient to prevent imminent foreclosure of
such liens, and with respect to which adequate reserves are being maintained by
such Borrower in accordance with GAAP; provided that in either case, such liens
(a) are not filed of record in any public office, (b) other than with respect to
Real Estate, are not senior in priority to the liens granted by such Borrower to
Investment Manager, for the benefit of Investment Manager and the L/C
Guarantors, or (c) do not secure taxes owed to the United States of America (or
any department or agency thereof) or any State or State authority, if applicable
State law provides for the priority of tax liens in a manner similar to the laws
of the United States of America.

          “Person” means any individual, sole proprietorship, partnership, joint
venture, trust, unincorporated organization, association, corporation, limited
liability company, institution, public benefit corporation, other entity or
government (whether federal, state, county, city, municipal, local, foreign, or
otherwise, including any instrumentality, division, agency, body or department
thereof).

          “Plan” means, at any time, an “employee benefit plan,” as defined in
Section 3(3) of ERISA (other than a Title IV Plan), that any Borrower or any
ERISA Affiliate maintains, contributes to or has an obligation to contribute to
on behalf of participants who are or were employed by such Borrower.

          “Pledge Agreements” means any pledge agreement in favor of Investment
Manager or the L/C Guarantors, including without limitation, the Stock Pledge
Agreement.

          “Purchase Money Liens” shall mean (i) liens on any item of Equipment
acquired by the applicable Borrower after the date of this Agreement, provided
that (a) each such lien shall attach only to the Equipment acquired, (b) a
description of the Equipment so acquired is furnished by such Borrower to
Investment Manager, (ii) liens on any item of Equipment acquired by the
applicable Borrower after the date of this Agreement arising in connection with
a Capital Lease of such Equipment, provided, that each such lien shall attach
only to the Equipment leased and (iii) any other liens incurred to secure the
unpaid purchase price of assets and which the applicable Borrower is permitted
to incur pursuant to the terms of its Senior Indebtedness.

          “Qualified Plan” means a Pension Plan that is intended to be
tax-qualified under Section 401(a) of the IRC.

          “Real Estate” has the meaning ascribed to it in Section 4.9.

          “Release” means any release, threatened release, spill, emission,
leaking, pumping, pouring, emitting, emptying, escape, injection, deposit,
disposal, discharge, dispersal, dumping, leaching or migration of Hazardous
Material in the indoor or outdoor environment, including the

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movement of Hazardous Material through or in the air, soil, surface water,
ground water or property.

          “Required Insurance” has the meaning ascribed to it in Section 5.3.

          “Securities Act” means the Securities Act of 1933, as amended.

          “Security Agreement” means the Security Agreement of even date
herewith entered into by and among Investment Manager, on behalf of itself and
the L/C Guarantors, and the Borrowers.

          “Senior Indebtedness” means, collectively, Indebtedness to CDF and the
other lenders named in the CDF Agreement and any renewals, refinancings or
replacements of such Indebtedness so long as the aggregate principal amount of
such Indebtedness does not at any time exceed $37,000,000.

          “Senior Lenders” means each lender with respect to any Senior
Indebtedness.

          “Stock” means all shares, options, warrants, general or limited
partnership interests, membership interests or other equivalents (regardless of
how designated) of or in a corporation, partnership, limited liability company
or equivalent entity 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 Securities and
Exchange Commission under the Securities Exchange Act of 1934).

          “Stockholder” means, with respect to any Person, each holder of Stock
of such Person.

          “Stock Pledge Agreement” means that certain Stock Pledge Agreement
dated of even date herewith, executed by MTM in favor of Investment Manager.

          “Subordinated Debt” means any Indebtedness of any Borrower
subordinated to the Obligations in a manner and form reasonably satisfactory to
Investment Manager and the L/C Guarantors in their sole discretion, as to right
and time of payment and as to any other rights and remedies thereunder.

          “Subordination Agreement” means that certain Subordination Agreement
dated as of the date hereof, executed by Investment Manager in favor of CDF, as
administrative agent for certain lenders, as the same may be amended, modified,
supplemented or restated from time to time, or any other subordination or
intercreditor agreement entered into between Investment Manager and any holder
of Senior Indebtedness in replacement thereof.

          “Subsidiary” means, with respect to any Person, (a) any corporation of
which an aggregate of more than 50% of the outstanding Stock having ordinary
voting power to elect a majority of the board of directors of such corporation
(irrespective of whether, at the time, Stock of any other class or classes of
such corporation shall have or might have voting power by reason of the
happening of any contingency) is at the time, directly or indirectly, owned
legally or beneficially by such Person or one or more Subsidiaries of such
Person, or with respect to which any such Person has the right to vote or
designate the vote of more than 50% of such Stock whether by proxy, agreement,
operation of law or otherwise, and (b) any partnership or limited

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liability company in which such Person and/or one or more Subsidiaries of such
Person shall have an interest (whether in the form of voting or participation in
profits or capital contribution) of more than 50% or of which any such Person is
a general partner or may exercise the powers of a general partner. Unless the
context otherwise requires, each reference to a Subsidiary shall be a reference
to a Subsidiary of a Borrower.

          “Taxes” shall mean all federal, state, municipal and other
governmental taxes, levies, charges, claims and assessments which are or may be
owed or collected by each Borrower with respect to its business, operations,
Collateral or otherwise.

          “Termination Date” means the date on which both (a) the Reimbursement
Payment and all Fees under this Agreement have been indefeasibly repaid in full,
and (b) all other Obligations under this Agreement and the other Loan Documents
have been completely discharged.

          “Title IV Plan” means a Pension Plan including a Multiemployer Plan,
that is covered by Title IV of ERISA.

          “Trademark License” means rights under any written agreement now owned
or hereafter acquired by any Borrower granting any right to use any Trademark.

          “Trademarks” means all of the following now owned or hereafter adopted
or acquired by any Borrower: (a) all trademarks, trade names, corporate names,
business names, trade styles, service marks, logos, internet domain names, other
source or business identifiers, prints and labels on which any of the foregoing
have appeared or appear, designs and general intangibles of like nature (whether
registered or unregistered), all registrations and recordings thereof, and all
applications in connection therewith, including registrations, recordings and
applications in the United States Patent and Trademark Office or in any similar
office or agency of the United States, any state or territory thereof, or any
other country or any political subdivision thereof; (b) all reissues, extensions
or renewals thereof; and (c) all goodwill associated with or symbolized by any
of the foregoing.

          “Welfare Plan” means a Plan described in Section 3(1) of ERISA.

          Rules of construction with respect to accounting terms used in the
Agreement or the other Loan Documents shall be as set forth or referred to in
this Annex A. All other undefined terms contained in any of the Loan Documents
which are defined in Article 9 of the Code shall, unless the context indicates
otherwise, have the meanings provided in Article 9 of the Code. Unless otherwise
specified, references in the Agreement or any of the Appendices to a Section,
subsection or clause refer to such Section, subsection or clause as contained in
the Agreement. The words “herein,” “hereof” and “hereunder” and other words of
similar import refer to the Agreement as a whole, including all Annexes,
Exhibits and Schedules, as the same may from time to time be amended, restated,
modified or supplemented, and not to any particular section, subsection or
clause contained in the Agreement or any such Annex, Exhibit or Schedule.

          Wherever from the context it appears appropriate, each term stated in
either the singular or plural shall include the singular and the plural, and
pronouns stated in the masculine, feminine or neuter gender shall include the
masculine, feminine and neuter genders. The words “including”, “includes” and
“include” shall be deemed to be followed by the words “without

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limitation”; the word “or” is not exclusive; references to Persons include their
respective successors and assigns (to the extent and only to the extent
permitted by the Loan Documents) or, in the case of governmental Persons,
Persons succeeding to the relevant functions of such Persons; and all references
to statutes and related regulations shall include any amendments of the same and
any successor statutes and regulations. Whenever any provision in any Loan
Document refers to the knowledge (or an analogous phrase) of any Borrower or
Borrowers, such words are intended to signify that any Borrower has actual
knowledge or awareness of a particular fact or circumstance or that any
Borrower, if it had exercised reasonable diligence, would have known or been
aware of such fact or circumstance.

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INDEX OF APPENDICES

 

 

 

Annexes

 

 

 

 

 

Annex A

-

Definitions

 

 

 

Exhibits

 

 

 

 

 

Exhibit 3.1(d)

-

Opinion

 

 

 

Schedules

 

 

 

 

 

Schedule of L/Cs

 

 

Schedule 4.3(a)

-

Jurisdictions of Organization and Qualifications

Schedule 4.3(b)

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Capitalization

Schedule 4.6

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Investigations and Audits

Schedule 4.7

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Litigation

Schedule 4.13

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Material Agreements Defaults/Breaches

Schedule 6.2

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Indebtedness

Schedule 6.12

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Business Description

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